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 (Do not check if a smaller reporting company) | Smaller reporting company o |
Emerging growth company o |
Page | ||
Item 1. | Financial Statements (Unaudited) | |
(dollars in thousands) | June 30, 2018 | December 31, 2017 | |||||
Assets | |||||||
Cash and due from banks | $ | 75,547 | $ | 75,318 | |||
Interest-bearing deposits in other banks | 13,948 | 6,975 | |||||
Investment securities: | |||||||
Available-for-sale debt securities, at fair value | 1,279,969 | 1,304,066 | |||||
Held-to-maturity debt securities, at amortized cost; fair value of: $152,330 at June 30, 2018 and $189,201 at December 31, 2017 | 158,156 | 191,753 | |||||
Equity securities, at fair value | 844 | 825 | |||||
Total investment securities | 1,438,969 | 1,496,644 | |||||
Loans held for sale | 9,096 | 16,336 | |||||
Loans and leases | 3,881,581 | 3,770,615 | |||||
Allowance for loan and lease losses | (48,181 | ) | (50,001 | ) | |||
Net loans and leases | 3,833,400 | 3,720,614 | |||||
Premises and equipment, net | 47,004 | 48,348 | |||||
Accrued interest receivable | 16,606 | 16,581 | |||||
Investment in unconsolidated subsidiaries | 9,362 | 7,088 | |||||
Other real estate owned | 595 | 851 | |||||
Mortgage servicing rights | 15,756 | 15,843 | |||||
Core deposit premium | 669 | 2,006 | |||||
Bank-owned life insurance | 156,945 | 156,293 | |||||
Federal Home Loan Bank stock | 10,246 | 7,761 | |||||
Other assets | 53,376 | 53,050 | |||||
Total assets | $ | 5,681,519 | $ | 5,623,708 | |||
Liabilities | |||||||
Deposits: | |||||||
Noninterest-bearing demand | $ | 1,365,010 | $ | 1,395,556 | |||
Interest-bearing demand | 952,991 | 933,054 | |||||
Savings and money market | 1,502,284 | 1,481,876 | |||||
Time | 1,158,814 | 1,145,868 | |||||
Total deposits | 4,979,099 | 4,956,354 | |||||
Short-term borrowings | 87,000 | 32,000 | |||||
Long-term debt | 92,785 | 92,785 | |||||
Other liabilities | 41,967 | 42,534 | |||||
Total liabilities | 5,200,851 | 5,123,673 | |||||
Equity | |||||||
Preferred stock, no par value, authorized 1,000,000 shares; issued and outstanding: none at June 30, 2018 and December 31, 2017 | — | — | |||||
Common stock, no par value, authorized 185,000,000 shares; issued and outstanding: 29,489,954 at June 30, 2018 and 30,024,222 at December 31, 2017 | 485,402 | 503,988 | |||||
Surplus | 86,949 | 86,098 | |||||
Accumulated deficit | (70,435 | ) | (89,036 | ) | |||
Accumulated other comprehensive income (loss) | (21,248 | ) | (1,039 | ) | |||
Total shareholders' equity | 480,668 | 500,011 | |||||
Non-controlling interest | — | 24 | |||||
Total equity | 480,668 | 500,035 | |||||
Total liabilities and equity | $ | 5,681,519 | $ | 5,623,708 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
(dollars in thousands, except per share data) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Interest income: | |||||||||||||||
Interest and fees on loans and leases | $ | 38,699 | $ | 35,531 | $ | 76,089 | $ | 70,488 | |||||||
Interest and dividends on investment securities: | |||||||||||||||
Taxable interest | 8,717 | 8,481 | 17,560 | 16,616 | |||||||||||
Tax-exempt interest | 933 | 974 | 1,866 | 1,953 | |||||||||||
Dividends | 3 | 12 | 18 | 24 | |||||||||||
Interest on deposits in other banks | 117 | 61 | 201 | 135 | |||||||||||
Dividends on Federal Home Loan Bank stock | 40 | 21 | 85 | 77 | |||||||||||
Total interest income | 48,509 | 45,080 | 95,819 | 89,293 | |||||||||||
Interest expense: | |||||||||||||||
Interest on deposits: | |||||||||||||||
Demand | 193 | 154 | 373 | 294 | |||||||||||
Savings and money market | 459 | 259 | 828 | 516 | |||||||||||
Time | 4,034 | 2,136 | 7,459 | 3,853 | |||||||||||
Interest on short-term borrowings | 48 | 46 | 91 | 77 | |||||||||||
Interest on long-term debt | 1,103 | 856 | 2,074 | 1,669 | |||||||||||
Total interest expense | 5,837 | 3,451 | 10,825 | 6,409 | |||||||||||
Net interest income | 42,672 | 41,629 | 84,994 | 82,884 | |||||||||||
Provision (credit) for loan and lease losses | 532 | (2,282 | ) | 321 | (2,362 | ) | |||||||||
Net interest income after provision (credit) for loan and lease losses | 42,140 | 43,911 | 84,673 | 85,246 | |||||||||||
Other operating income: | |||||||||||||||
Mortgage banking income | 1,775 | 1,957 | 3,622 | 3,900 | |||||||||||
Service charges on deposit accounts | 1,977 | 2,120 | 3,980 | 4,156 | |||||||||||
Other service charges and fees | 3,377 | 3,053 | 6,411 | 5,801 | |||||||||||
Income from fiduciary activities | 1,017 | 964 | 1,973 | 1,828 | |||||||||||
Equity in earnings of unconsolidated subsidiaries | 37 | 151 | 80 | 212 | |||||||||||
Fees on foreign exchange | 277 | 130 | 488 | 293 | |||||||||||
Investment securities gains (losses) | — | (1,640 | ) | — | (1,640 | ) | |||||||||
Income from bank-owned life insurance | 501 | 583 | 819 | 1,700 | |||||||||||
Loan placement fees | 220 | 146 | 417 | 280 | |||||||||||
Net gain on sales of foreclosed assets | — | 84 | — | 186 | |||||||||||
Other | 449 | 322 | 794 | 1,168 | |||||||||||
Total other operating income | 9,630 | 7,870 | 18,584 | 17,884 | |||||||||||
Other operating expense: | |||||||||||||||
Salaries and employee benefits | 18,783 | 17,983 | 37,288 | 35,370 | |||||||||||
Net occupancy | 3,360 | 3,335 | 6,626 | 6,749 | |||||||||||
Equipment | 1,044 | 967 | 2,112 | 1,809 | |||||||||||
Amortization of core deposit premium | 668 | 669 | 1,337 | 1,337 | |||||||||||
Communication expense | 746 | 891 | 1,644 | 1,791 | |||||||||||
Legal and professional services | 1,769 | 1,987 | 3,590 | 3,779 | |||||||||||
Computer software expense | 2,305 | 2,190 | 4,572 | 4,442 | |||||||||||
Advertising expense | 617 | 390 | 1,229 | 782 | |||||||||||
Foreclosed asset expense | 31 | 63 | 325 | 99 | |||||||||||
Other | 4,401 | 3,860 | 8,519 | 7,637 | |||||||||||
Total other operating expense | 33,724 | 32,335 | 67,242 | 63,795 | |||||||||||
Income before income taxes | 18,046 | 19,446 | 36,015 | 39,335 | |||||||||||
Income tax expense | 3,822 | 7,421 | 7,514 | 14,231 | |||||||||||
Net income | $ | 14,224 | $ | 12,025 | $ | 28,501 | $ | 25,104 | |||||||
Per common share data: | |||||||||||||||
Basic earnings per common share | $ | 0.48 | $ | 0.39 | $ | 0.96 | $ | 0.82 | |||||||
Diluted earnings per common share | $ | 0.48 | $ | 0.39 | $ | 0.95 | $ | 0.81 | |||||||
Cash dividends declared | $ | 0.21 | $ | 0.18 | $ | 0.40 | $ | 0.34 | |||||||
Weighted average common shares outstanding used in computation: | |||||||||||||||
Basic shares | 29,510,175 | 30,568,247 | 29,658,051 | 30,641,165 | |||||||||||
Diluted shares | 29,714,942 | 30,803,725 | 29,881,534 | 30,879,923 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
(dollars in thousands) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Net income | $ | 14,224 | $ | 12,025 | $ | 28,501 | $ | 25,104 | ||||||||
Other comprehensive income (loss), net of tax: | ||||||||||||||||
Net change in unrealized gain (loss) on investment securities | (3,669 | ) | 2,795 | (18,640 | ) | 4,919 | ||||||||||
Defined benefit plans | 150 | 190 | 406 | (174 | ) | |||||||||||
Total other comprehensive income (loss), net of tax | (3,519 | ) | 2,985 | (18,234 | ) | 4,745 | ||||||||||
Comprehensive income | $ | 10,705 | $ | 15,010 | $ | 10,267 | $ | 29,849 |
Common Shares Outstanding | Preferred Stock | Common Stock | Surplus | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Non- Controlling Interest | Total | |||||||||||||||||||||||
(dollars in thousands, except per share data) | ||||||||||||||||||||||||||||||
Balance at December 31, 2017 | 30,024,222 | $ | — | $ | 503,988 | $ | 86,098 | $ | (89,036 | ) | $ | (1,039 | ) | $ | 24 | $ | 500,035 | |||||||||||||
Impact of the adoption of new accounting standards (1) | — | — | — | — | 139 | (139 | ) | — | — | |||||||||||||||||||||
Adjusted balance at January 1, 2018 | 30,024,222 | — | 503,988 | 86,098 | (88,897 | ) | (1,178 | ) | 24 | 500,035 | ||||||||||||||||||||
Impact of the adoption of new accounting standards (2) | — | — | — | — | 1,836 | (1,836 | ) | — | — | |||||||||||||||||||||
Net income | — | — | — | — | 28,501 | — | — | 28,501 | ||||||||||||||||||||||
Other comprehensive loss | — | — | — | — | — | (18,234 | ) | — | (18,234 | ) | ||||||||||||||||||||
Cash dividends ($0.40 per share) | — | — | — | — | (11,875 | ) | — | — | (11,875 | ) | ||||||||||||||||||||
16,950 net shares of common stock purchased by directors' deferred compensation plan | — | — | (504 | ) | — | — | — | — | (504 | ) | ||||||||||||||||||||
614,247 shares of common stock repurchased and retired and other related costs | (614,247 | ) | — | (18,082 | ) | — | — | — | (18,082 | ) | ||||||||||||||||||||
Share-based compensation | 79,979 | — | — | 851 | — | — | — | 851 | ||||||||||||||||||||||
Distribution from variable interest entity | — | — | — | — | — | — | (24 | ) | (24 | ) | ||||||||||||||||||||
Balance at June 30, 2018 | 29,489,954 | $ | — | $ | 485,402 | $ | 86,949 | $ | (70,435 | ) | $ | (21,248 | ) | $ | — | $ | 480,668 | |||||||||||||
Balance at December 31, 2016 | 30,796,243 | $ | — | $ | 530,932 | $ | 84,180 | $ | (108,941 | ) | $ | (1,521 | ) | $ | 25 | $ | 504,675 | |||||||||||||
Net income | — | — | — | — | 25,104 | — | — | 25,104 | ||||||||||||||||||||||
Other comprehensive income | — | — | — | — | — | 4,745 | — | 4,745 | ||||||||||||||||||||||
Cash dividends ($0.34 per share) | — | — | — | — | (10,432 | ) | — | — | (10,432 | ) | ||||||||||||||||||||
10,620 net shares of common stock purchased by directors' deferred compensation plan | — | — | (341 | ) | — | — | — | — | (341 | ) | ||||||||||||||||||||
362,371 shares of common stock repurchased and retired and other related costs | (362,371 | ) | — | (11,208 | ) | — | — | — | — | (11,208 | ) | |||||||||||||||||||
Share-based compensation | 80,927 | — | — | 412 | — | — | — | 412 | ||||||||||||||||||||||
Balance at June 30, 2017 | 30,514,799 | $ | — | $ | 519,383 | $ | 84,592 | $ | (94,269 | ) | $ | 3,224 | $ | 25 | $ | 512,955 | ||||||||||||||
(1) Represents the impact of the adoption of Accounting Standards Update ("ASU") ASU 2016-01. See Notes 1 and 2 to the consolidated financial statements for additional information. | ||||||||||||||||||||||||||||||
(2) Represents the impact of the adoption of ASU 2018-02. See Note 2 to the consolidated financial statements for additional information. | ||||||||||||||||||||||||||||||
Six Months Ended June 30, | |||||||
(dollars in thousands) | 2018 | 2017 | |||||
Cash flows from operating activities: | |||||||
Net income | $ | 28,501 | $ | 25,104 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Provision (credit) for loan and lease losses | 321 | (2,362 | ) | ||||
Depreciation and amortization | 3,177 | 3,150 | |||||
Write down of other real estate, net of gain on sale | 250 | (165 | ) | ||||
Amortization of core deposit premium and mortgage servicing rights | 2,231 | 2,404 | |||||
Net amortization and accretion of premium/discounts on investment securities | 5,769 | 5,826 | |||||
Share-based compensation | 851 | 412 | |||||
Net loss on sales of investment securities | — | 1,640 | |||||
Net gain on sales of residential mortgage loans | (1,931 | ) | (2,396 | ) | |||
Proceeds from sales of loans held for sale | 118,294 | 168,624 | |||||
Originations of loans held for sale | (109,123 | ) | (147,635 | ) | |||
Equity in earnings of unconsolidated subsidiaries | (80 | ) | (212 | ) | |||
Net increase in cash surrender value of bank-owned life insurance | (819 | ) | (2,170 | ) | |||
Deferred income taxes | 7,348 | 13,648 | |||||
Net tax benefits from share-based compensation | 166 | 583 | |||||
Net change in other assets and liabilities | (5,274 | ) | (8,279 | ) | |||
Net cash provided by operating activities | 49,681 | 58,172 | |||||
Cash flows from investing activities: | |||||||
Proceeds from maturities of and calls on investment securities available-for-sale | 78,401 | 86,372 | |||||
Proceeds from sales of investment securities available-for-sale | — | 96,019 | |||||
Purchases of investment securities available-for-sale | (85,313 | ) | (253,372 | ) | |||
Proceeds from maturities of and calls on investment securities held-to-maturity | 33,319 | 12,715 | |||||
Net loan proceeds (originations) | (92,539 | ) | (17,715 | ) | |||
Purchases of loan portfolios | (20,608 | ) | (50,725 | ) | |||
Proceeds from sale of foreclosed loans/other real estate owned | 46 | 102 | |||||
Proceeds from bank-owned life insurance | 167 | 1,710 | |||||
Net purchases of premises and equipment | (1,833 | ) | (4,144 | ) | |||
Net return of capital from unconsolidated subsidiaries | 578 | 455 | |||||
Net (purchases of) proceeds from redemption of FHLB stock | (2,485 | ) | 5,080 | ||||
Net cash used in investing activities | (90,267 | ) | (123,503 | ) | |||
Cash flows from financing activities: | |||||||
Net increase in deposits | 22,745 | 278,181 | |||||
Net (decrease) increase in short-term borrowings | 55,000 | (135,000 | ) | ||||
Cash dividends paid on common stock | (11,875 | ) | (10,432 | ) | |||
Repurchases of common stock and other related costs | (18,082 | ) | (11,208 | ) | |||
Net cash provided by financing activities | 47,788 | 121,541 | |||||
Net increase (decrease) in cash and cash equivalents | 7,202 | 56,210 | |||||
Cash and cash equivalents at beginning of period | 82,293 | 84,341 | |||||
Cash and cash equivalents at end of period | $ | 89,495 | $ | 140,551 | |||
Supplemental disclosure of cash flow information: | |||||||
Cash paid during the period for: | |||||||
Interest | $ | 10,552 | $ | 5,461 | |||
Income taxes | 22 | 4,000 | |||||
Supplemental disclosure of non-cash investing and financing activities: | |||||||
Net reclassification of loans to foreclosed loans/other real estate owned | 40 | 154 |
(dollars in thousands) | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||
June 30, 2018 | |||||||||||||||
Held-to-maturity: | |||||||||||||||
Mortgage-backed securities: | |||||||||||||||
Residential - U.S. Government-sponsored entities | $ | 92,247 | $ | 3 | $ | (3,916 | ) | $ | 88,334 | ||||||
Commercial - U.S. Government-sponsored entities | 65,909 | — | (1,913 | ) | 63,996 | ||||||||||
Total | $ | 158,156 | $ | 3 | $ | (5,829 | ) | $ | 152,330 | ||||||
Available-for-sale: | |||||||||||||||
Debt securities: | |||||||||||||||
States and political subdivisions | $ | 176,640 | $ | 1,258 | $ | (1,980 | ) | $ | 175,918 | ||||||
Corporate securities | 65,908 | 28 | (504 | ) | 65,432 | ||||||||||
U.S. Treasury obligations and direct obligations of U.S Government agencies | 35,746 | 23 | (266 | ) | 35,503 | ||||||||||
Mortgage-backed securities: | |||||||||||||||
Residential - U.S. Government-sponsored entities | 797,679 | 389 | (24,343 | ) | 773,725 | ||||||||||
Commercial - U.S. Government agencies and sponsored entities | 54,429 | — | (2,006 | ) | 52,423 | ||||||||||
Residential - Non-government agencies | 43,150 | 316 | (620 | ) | 42,846 | ||||||||||
Commercial - Non-government agencies | 134,962 | 877 | (1,717 | ) | 134,122 | ||||||||||
Total | $ | 1,308,514 | $ | 2,891 | $ | (31,436 | ) | $ | 1,279,969 | ||||||
Equity securities | $ | 692 | $ | 152 | $ | — | $ | 844 |
(dollars in thousands) | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||
December 31, 2017 | |||||||||||||||
Held-to-maturity: | |||||||||||||||
Mortgage-backed securities: | |||||||||||||||
Residential - U.S. Government-sponsored entities | $ | 100,279 | $ | 106 | $ | (2,222 | ) | $ | 98,163 | ||||||
Commercial - U.S. Government-sponsored entities | 91,474 | — | (436 | ) | 91,038 | ||||||||||
Total | $ | 191,753 | $ | 106 | $ | (2,658 | ) | $ | 189,201 | ||||||
Available-for-sale: | |||||||||||||||
Debt securities: | |||||||||||||||
States and political subdivisions | $ | 178,459 | $ | 2,041 | $ | (719 | ) | $ | 179,781 | ||||||
Corporate securities | 73,772 | 582 | (76 | ) | 74,278 | ||||||||||
U.S. Treasury obligations and direct obligations of U.S Government agencies | 25,519 | 60 | (69 | ) | 25,510 | ||||||||||
Mortgage-backed securities: | |||||||||||||||
Residential - U.S. Government-sponsored entities | 808,242 | 2,230 | (9,789 | ) | 800,683 | ||||||||||
Commercial - U.S. Government agencies and sponsored entities | 40,012 | — | (287 | ) | 39,725 | ||||||||||
Residential - Non-government agencies | 45,679 | 1,084 | — | 46,763 | |||||||||||
Commercial - Non-government agencies | 135,058 | 2,461 | (193 | ) | 137,326 | ||||||||||
Total | $ | 1,306,741 | $ | 8,458 | $ | (11,133 | ) | $ | 1,304,066 | ||||||
Equity securities | $ | 686 | $ | 139 | $ | — | $ | 825 |
June 30, 2018 | |||||||
(dollars in thousands) | Amortized Cost | Fair Value | |||||
Held-to-maturity: | |||||||
Mortgage-backed securities: | |||||||
Residential - U.S. Government-sponsored entities | $ | 92,247 | $ | 88,334 | |||
Commercial - U.S. Government-sponsored entities | 65,909 | 63,996 | |||||
Total | $ | 158,156 | $ | 152,330 | |||
Available-for-sale: | |||||||
Due in one year or less | $ | 35,234 | $ | 35,259 | |||
Due after one year through five years | 132,627 | 132,431 | |||||
Due after five years through ten years | 50,044 | 49,512 | |||||
Due after ten years | 60,389 | 59,651 | |||||
Mortgage-backed securities: | |||||||
Residential - U.S. Government-sponsored entities | 797,679 | 773,725 | |||||
Commercial - U.S. Government agencies and sponsored entities | 54,429 | 52,423 | |||||
Residential - Non-government agencies | 43,150 | 42,846 | |||||
Commercial - Non-government agencies | 134,962 | 134,122 | |||||
Total | $ | 1,308,514 | $ | 1,279,969 | |||
Equity securities | $ | 692 | $ | 844 |
Less Than 12 Months | 12 Months or Longer | Total | |||||||||||||||||||||
(dollars in thousands) | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | |||||||||||||||||
June 30, 2018 | |||||||||||||||||||||||
Debt securities: | |||||||||||||||||||||||
States and political subdivisions | $ | 72,466 | $ | (1,052 | ) | $ | 15,114 | $ | (928 | ) | $ | 87,580 | $ | (1,980 | ) | ||||||||
Corporate securities | 47,624 | (316 | ) | 5,144 | (188 | ) | 52,768 | (504 | ) | ||||||||||||||
U.S. Treasury obligations and direct obligations of U.S Government agencies | 28,864 | (266 | ) | — | — | 28,864 | (266 | ) | |||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||
Residential - U.S. Government-sponsored entities | 499,759 | (11,959 | ) | 339,024 | (16,300 | ) | 838,783 | (28,259 | ) | ||||||||||||||
Residential - Non-government agencies | 25,590 | (620 | ) | — | — | 25,590 | (620 | ) | |||||||||||||||
Commercial - U.S. Government agencies and sponsored entities | 116,420 | (3,919 | ) | — | — | 116,420 | (3,919 | ) | |||||||||||||||
Commercial - Non-government agencies | 85,063 | (1,717 | ) | — | — | 85,063 | (1,717 | ) | |||||||||||||||
Total temporarily impaired securities | $ | 875,786 | $ | (19,849 | ) | $ | 359,282 | $ | (17,416 | ) | $ | 1,235,068 | $ | (37,265 | ) |
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, 2017 | |||||||||||||||||||||||
Debt securities: | |||||||||||||||||||||||
States and political subdivisions | $ | 53,811 | $ | (305 | ) | $ | 15,403 | $ | (414 | ) | $ | 69,214 | $ | (719 | ) | ||||||||
Corporate securities | — | — | 5,307 | (76 | ) | 5,307 | (76 | ) | |||||||||||||||
U.S. Treasury obligations and direct obligations of U.S Government agencies | 10,740 | (69 | ) | — | — | 10,740 | (69 | ) | |||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||
Residential - U.S. Government-sponsored entities | 335,883 | (3,372 | ) | 340,219 | (8,639 | ) | 676,102 | (12,011 | ) | ||||||||||||||
Residential - Non-government agencies | — | — | — | — | — | — | |||||||||||||||||
Commercial - U.S. Government-sponsored entities | 130,763 | (723 | ) | — | — | 130,763 | (723 | ) | |||||||||||||||
Commercial - Non-government agencies | 28,490 | (193 | ) | — | — | 28,490 | (193 | ) | |||||||||||||||
Total temporarily impaired securities | $ | 559,687 | $ | (4,662 | ) | $ | 360,929 | $ | (9,129 | ) | $ | 920,616 | $ | (13,791 | ) |
• | 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) | June 30, 2018 | December 31, 2017 | |||||
Commercial, financial and agricultural | $ | 522,903 | $ | 503,738 | |||
Real estate: | |||||||
Construction | 67,289 | 64,525 | |||||
Residential mortgage | 1,373,345 | 1,337,193 | |||||
Home equity | 430,871 | 412,230 | |||||
Commercial mortgage | 1,019,629 | 979,239 | |||||
Consumer | 464,950 | 470,819 | |||||
Leases | 223 | 362 | |||||
Gross loans and leases | 3,879,210 | 3,768,106 | |||||
Net deferred costs | 2,371 | 2,509 | |||||
Total loans and leases, net of deferred costs | $ | 3,881,581 | $ | 3,770,615 | |||
Real Estate | |||||||||||||||||||||||||||||||
(dollars in thousands) | Comml, Fin & Ag | Constr | Resi Mortgage | Home Equity | Comml Mortgage | Consumer | Leases | Total | |||||||||||||||||||||||
June 30, 2018 | |||||||||||||||||||||||||||||||
Allowance: | |||||||||||||||||||||||||||||||
Individually evaluated for impairment | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||
Collectively evaluated for impairment | 7,525 | 1,811 | 14,252 | 3,168 | 15,094 | 6,331 | — | 48,181 | |||||||||||||||||||||||
Total ending balance | $ | 7,525 | $ | 1,811 | $ | 14,252 | $ | 3,168 | $ | 15,094 | $ | 6,331 | $ | — | $ | 48,181 | |||||||||||||||
Loans and leases: | |||||||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 423 | $ | 2,437 | $ | 12,888 | $ | 514 | $ | 3,572 | $ | — | $ | — | $ | 19,834 | |||||||||||||||
Collectively evaluated for impairment | 522,480 | 64,852 | 1,360,457 | 430,357 | 1,016,057 | 464,950 | 223 | 3,859,376 | |||||||||||||||||||||||
Subtotal | 522,903 | 67,289 | 1,373,345 | 430,871 | 1,019,629 | 464,950 | 223 | 3,879,210 | |||||||||||||||||||||||
Net deferred costs (income) | 392 | (395 | ) | 3,874 | (1 | ) | (1,439 | ) | (60 | ) | — | 2,371 | |||||||||||||||||||
Total loans and leases, net of deferred costs (income) | $ | 523,295 | $ | 66,894 | $ | 1,377,219 | $ | 430,870 | $ | 1,018,190 | $ | 464,890 | $ | 223 | $ | 3,881,581 |
Real Estate | |||||||||||||||||||||||||||||||
(dollars in thousands) | Comml, Fin & Ag | Constr | Resi Mortgage | Home Equity | Comml Mortgage | Consumer | Leases | Total | |||||||||||||||||||||||
December 31, 2017 | |||||||||||||||||||||||||||||||
Allowance: | |||||||||||||||||||||||||||||||
Individually evaluated for impairment | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||
Collectively evaluated for impairment | 7,594 | 1,835 | 14,328 | 3,317 | 16,801 | 6,126 | — | 50,001 | |||||||||||||||||||||||
Total ending balance | $ | 7,594 | $ | 1,835 | $ | 14,328 | $ | 3,317 | $ | 16,801 | 6,126 | $ | — | $ | 50,001 | ||||||||||||||||
Loans and leases: | |||||||||||||||||||||||||||||||
Individually evaluated for impairment | $ | 491 | $ | 2,597 | $ | 13,862 | $ | 416 | $ | 3,914 | $ | — | $ | — | $ | 21,280 | |||||||||||||||
Collectively evaluated for impairment | 503,247 | 61,928 | 1,323,331 | 411,814 | 975,325 | 470,819 | 362 | 3,746,826 | |||||||||||||||||||||||
Subtotal | 503,738 | 64,525 | 1,337,193 | 412,230 | 979,239 | 470,819 | 362 | 3,768,106 | |||||||||||||||||||||||
Net deferred costs (income) | 281 | (285 | ) | 4,028 | — | (1,442 | ) | (73 | ) | — | 2,509 | ||||||||||||||||||||
Total loans and leases, net of deferred costs (income) | $ | 504,019 | $ | 64,240 | $ | 1,341,221 | $ | 412,230 | $ | 977,797 | $ | 470,746 | $ | 362 | $ | 3,770,615 |
June 30, 2018 | December 31, 2017 | ||||||||||||||||||||||
Unpaid Principal Balance | Recorded Investment | Allowance Allocated | Unpaid Principal Balance | Recorded Investment | Allowance Allocated | ||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||
Impaired loans with no related Allowance recorded: | |||||||||||||||||||||||
Commercial, financial & agricultural | $ | 533 | $ | 423 | $ | — | $ | 602 | $ | 491 | $ | — | |||||||||||
Real estate: | |||||||||||||||||||||||
Construction | 7,787 | 2,437 | — | 7,947 | 2,597 | — | |||||||||||||||||
Residential mortgage | 13,947 | 12,888 | — | 14,920 | 13,862 | — | |||||||||||||||||
Home equity | 514 | 514 | — | 416 | 416 | — | |||||||||||||||||
Commercial mortgage | 3,572 | 3,572 | — | 3,914 | 3,914 | — | |||||||||||||||||
Total impaired loans | $ | 26,353 | $ | 19,834 | $ | — | $ | 27,799 | $ | 21,280 | $ | — |
Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||||||
June 30, 2018 | June 30, 2017 | June 30, 2018 | June 30, 2017 | ||||||||||||||||||||||||||||
(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 | $ | 628 | $ | 3 | $ | 1,291 | $ | 4 | $ | 540 | $ | 5 | $ | 1,624 | $ | 4 | |||||||||||||||
Real estate: | |||||||||||||||||||||||||||||||
Construction | 2,464 | 28 | 2,783 | 24 | 2,517 | 54 | 2,841 | 48 | |||||||||||||||||||||||
Residential mortgage | 12,832 | 159 | 17,658 | 1,070 | 13,358 | 296 | 18,597 | 1,167 | |||||||||||||||||||||||
Home equity | 518 | — | 1,482 | 1 | 546 | — | 1,310 | 1 | |||||||||||||||||||||||
Commercial mortgage | 3,616 | 36 | 5,346 | 46 | 3,726 | 74 | 5,445 | 93 | |||||||||||||||||||||||
Total | $ | 20,058 | $ | 226 | $ | 28,560 | $ | 1,145 | $ | 20,687 | $ | 429 | $ | 29,817 | $ | 1,313 |
(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 | ||||||||||||||||||||
June 30, 2018 | |||||||||||||||||||||||||||
Commercial, financial & agricultural | $ | 10,622 | $ | 283 | $ | — | $ | — | $ | 10,905 | $ | 512,390 | $ | 523,295 | |||||||||||||
Real estate: | |||||||||||||||||||||||||||
Construction | — | — | — | — | — | 66,894 | 66,894 | ||||||||||||||||||||
Residential mortgage | — | 2,069 | 279 | 2,400 | 4,748 | 1,372,471 | 1,377,219 | ||||||||||||||||||||
Home equity | 48 | 105 | — | 514 | 667 | 430,203 | 430,870 | ||||||||||||||||||||
Commercial mortgage | — | — | — | — | — | 1,018,190 | 1,018,190 | ||||||||||||||||||||
Consumer | 1,512 | 860 | 362 | — | 2,734 | 462,156 | 464,890 | ||||||||||||||||||||
Leases | — | — | — | — | — | 223 | 223 | ||||||||||||||||||||
Total | $ | 12,182 | $ | 3,317 | $ | 641 | $ | 2,914 | $ | 19,054 | $ | 3,862,527 | $ | 3,881,581 |
(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, 2017 | |||||||||||||||||||||||||||
Commercial, financial & agricultural | $ | 410 | $ | 355 | $ | — | $ | — | $ | 765 | $ | 503,254 | $ | 504,019 | |||||||||||||
Real estate: | |||||||||||||||||||||||||||
Construction | — | — | — | — | — | 64,240 | 64,240 | ||||||||||||||||||||
Residential mortgage | 4,037 | 2,127 | 49 | 2,280 | 8,493 | 1,332,728 | 1,341,221 | ||||||||||||||||||||
Home equity | 105 | 264 | — | 416 | 785 | 411,445 | 412,230 | ||||||||||||||||||||
Commercial mortgage | — | — | — | 79 | 79 | 977,718 | 977,797 | ||||||||||||||||||||
Consumer | 2,126 | 1,056 | 515 | — | 3,697 | 467,049 | 470,746 | ||||||||||||||||||||
Leases | — | — | — | — | — | 362 | 362 | ||||||||||||||||||||
Total | $ | 6,678 | $ | 3,802 | $ | 564 | $ | 2,775 | $ | 13,819 | $ | 3,756,796 | $ | 3,770,615 |
(dollars in thousands) | Number of Contracts | Recorded Investment (as of Period End) | Increase in the Allowance | |||||||
Six Months Ended June 30, 2017 | ||||||||||
Commercial, financial & agricultural | 1 | $ | 653 | $ | — | |||||
Total | 1 | $ | 653 | $ | — |
(dollars in thousands) | Pass | Special Mention | Substandard | Loss | Subtotal | Net Deferred Costs (Income) | Total | ||||||||||||||||||||
June 30, 2018 | |||||||||||||||||||||||||||
Commercial, financial & agricultural | $ | 496,758 | $ | 8,390 | $ | 17,755 | $ | — | $ | 522,903 | $ | 392 | $ | 523,295 | |||||||||||||
Real estate: | |||||||||||||||||||||||||||
Construction | 58,410 | 8,879 | — | — | 67,289 | (395 | ) | 66,894 | |||||||||||||||||||
Residential mortgage | 1,370,568 | — | 2,777 | — | 1,373,345 | 3,874 | 1,377,219 | ||||||||||||||||||||
Home equity | 430,357 | — | 514 | — | 430,871 | (1 | ) | 430,870 | |||||||||||||||||||
Commercial mortgage | 1,007,316 | 10,613 | 1,700 | — | 1,019,629 | (1,439 | ) | 1,018,190 | |||||||||||||||||||
Consumer | 464,588 | — | 158 | 204 | 464,950 | (60 | ) | 464,890 | |||||||||||||||||||
Leases | 223 | — | — | — | 223 | — | 223 | ||||||||||||||||||||
Total | $ | 3,828,220 | $ | 27,882 | $ | 22,904 | $ | 204 | $ | 3,879,210 | $ | 2,371 | $ | 3,881,581 |
(dollars in thousands) | Pass | Special Mention | Substandard | Loss | Subtotal | Net Deferred Costs (Income) | Total | ||||||||||||||||||||
December 31, 2017 | |||||||||||||||||||||||||||
Commercial, financial & agricultural | $ | 474,995 | $ | 7,543 | $ | 21,200 | $ | — | $ | 503,738 | $ | 281 | $ | 504,019 | |||||||||||||
Real estate: | |||||||||||||||||||||||||||
Construction | 55,646 | 8,879 | — | — | 64,525 | (285 | ) | 64,240 | |||||||||||||||||||
Residential mortgage | 1,334,760 | — | 2,433 | — | 1,337,193 | 4,028 | 1,341,221 | ||||||||||||||||||||
Home equity | 411,814 | — | 416 | — | 412,230 | — | 412,230 | ||||||||||||||||||||
Commercial mortgage | 955,865 | 12,735 | 10,639 | — | 979,239 | (1,442 | ) | 977,797 | |||||||||||||||||||
Consumer | 470,243 | — | 305 | 271 | 470,819 | (73 | ) | 470,746 | |||||||||||||||||||
Leases | 362 | — | — | — | 362 | — | 362 | ||||||||||||||||||||
Total | $ | 3,703,685 | $ | 29,157 | $ | 34,993 | $ | 271 | $ | 3,768,106 | $ | 2,509 | $ | 3,770,615 |
Real Estate | |||||||||||||||||||||||||||||||
Commercial, Financial & Agricultural | Construction | Residential Mortgage | Home Equity | Commercial Mortgage | Consumer | Leases | Total | ||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||
Three Months Ended June 30, 2018 | |||||||||||||||||||||||||||||||
Beginning balance | $ | 7,476 | $ | 1,714 | $ | 14,207 | $ | 3,328 | $ | 16,186 | $ | 6,306 | $ | — | $ | 49,217 | |||||||||||||||
Provision (credit) for loan and lease losses | 496 | 91 | 24 | (169 | ) | (1,121 | ) | 1,211 | — | 532 | |||||||||||||||||||||
7,972 | 1,805 | 14,231 | 3,159 | 15,065 | 7,517 | — | 49,749 | ||||||||||||||||||||||||
Charge-offs | 742 | — | — | — | — | 1,729 | — | 2,471 | |||||||||||||||||||||||
Recoveries | 295 | 6 | 21 | 9 | 29 | 543 | — | 903 | |||||||||||||||||||||||
Net charge-offs (recoveries) | 447 | (6 | ) | (21 | ) | (9 | ) | (29 | ) | 1,186 | — | 1,568 | |||||||||||||||||||
Ending balance | $ | 7,525 | $ | 1,811 | $ | 14,252 | $ | 3,168 | $ | 15,094 | $ | 6,331 | $ | — | $ | 48,181 | |||||||||||||||
Three Months Ended June 30, 2017 | |||||||||||||||||||||||||||||||
Beginning balance | $ | 8,346 | $ | 3,718 | $ | 14,892 | $ | 3,425 | $ | 19,187 | $ | 5,801 | $ | — | $ | 55,369 | |||||||||||||||
Provision (credit) for loan and lease losses | 353 | (562 | ) | (1,495 | ) | (82 | ) | (1,131 | ) | 635 | — | (2,282 | ) | ||||||||||||||||||
8,699 | 3,156 | 13,397 | 3,343 | 18,056 | 6,436 | — | 53,087 | ||||||||||||||||||||||||
Charge-offs | 337 | — | — | — | — | 1,470 | — | 1,807 | |||||||||||||||||||||||
Recoveries | 236 | 56 | 637 | 27 | 128 | 464 | — | 1,548 | |||||||||||||||||||||||
Net charge-offs (recoveries) | 101 | (56 | ) | (637 | ) | (27 | ) | (128 | ) | 1,006 | — | 259 | |||||||||||||||||||
Ending balance | $ | 8,598 | $ | 3,212 | $ | 14,034 | $ | 3,370 | $ | 18,184 | $ | 5,430 | $ | — | $ | 52,828 | |||||||||||||||
Real Estate | |||||||||||||||||||||||||||||||
Commercial, Financial & Agricultural | Construction | Residential Mortgage | Home Equity | Commercial Mortgage | Consumer | Leases | Total | ||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||
Six Months Ended June 30, 2018 | |||||||||||||||||||||||||||||||
Beginning balance | $ | 7,594 | $ | 1,835 | $ | 14,328 | $ | 3,317 | $ | 16,801 | $ | 6,126 | $ | — | $ | 50,001 | |||||||||||||||
Provision (credit) for loan and lease losses | 732 | (1,223 | ) | (123 | ) | (161 | ) | (1,751 | ) | 2,847 | — | 321 | |||||||||||||||||||
8,326 | 612 | 14,205 | 3,156 | 15,050 | 8,973 | — | 50,322 | ||||||||||||||||||||||||
Charge-offs | 1,240 | — | — | — | — | 3,662 | — | 4,902 | |||||||||||||||||||||||
Recoveries | 439 | 1,199 | 47 | 12 | 44 | 1,020 | — | 2,761 | |||||||||||||||||||||||
Net charge-offs (recoveries) | 801 | (1,199 | ) | (47 | ) | (12 | ) | (44 | ) | 2,642 | — | 2,141 | |||||||||||||||||||
Ending balance | $ | 7,525 | $ | 1,811 | $ | 14,252 | $ | 3,168 | $ | 15,094 | $ | 6,331 | $ | — | $ | 48,181 | |||||||||||||||
Six Months Ended June 30, 2017 | |||||||||||||||||||||||||||||||
Beginning balance | $ | 8,637 | $ | 4,224 | $ | 15,055 | $ | 3,502 | $ | 19,104 | $ | 6,109 | $ | — | $ | 56,631 | |||||||||||||||
Provision (credit) for loan and lease losses | 287 | (1,089 | ) | (1,754 | ) | (161 | ) | (1,059 | ) | 1,414 | — | (2,362 | ) | ||||||||||||||||||
8,924 | 3,135 | 13,301 | 3,341 | 18,045 | 7,523 | — | 54,269 | ||||||||||||||||||||||||
Charge-offs | 837 | — | — | — | — | 2,967 | — | 3,804 | |||||||||||||||||||||||
Recoveries | 511 | 77 | 733 | 29 | 139 | 874 | — | 2,363 | |||||||||||||||||||||||
Net charge-offs (recoveries) | 326 | (77 | ) | (733 | ) | (29 | ) | (139 | ) | 2,093 | — | 1,441 | |||||||||||||||||||
Ending balance | $ | 8,598 | $ | 3,212 | $ | 14,034 | $ | 3,370 | $ | 18,184 | $ | 5,430 | $ | — | $ | 52,828 | |||||||||||||||
(dollars in thousands) | June 30, 2018 | December 31, 2017 | |||||
Investments in low income housing tax credit partnerships | $ | 6,380 | $ | 3,608 | |||
Trust preferred investments | 2,792 | 2,792 | |||||
Investments in affiliates | 136 | 634 | |||||
Other | 54 | 54 | |||||
Total | $ | 9,362 | $ | 7,088 |
(dollars in thousands) | Three Months Ended June 30, 2018 | Three Months Ended June 30, 2017 | Six Months Ended June 30, 2018 | Six Months Ended June 30, 2017 | |||||||||||
Cost method: | |||||||||||||||
Amortization expense recognized in other operating expense | $ | 113 | $ | 223 | $ | 227 | $ | 456 | |||||||
Tax credits recognized in income tax expense | 153 | 260 | 305 | 526 |
(dollars in thousands) | Core Deposit Premium | Mortgage Servicing Rights | Total | ||||||||
Balance, beginning of period | $ | 2,006 | $ | 15,843 | $ | 17,849 | |||||
Additions | — | 807 | 807 | ||||||||
Amortization | (1,337 | ) | (894 | ) | (2,231 | ) | |||||
Balance, end of period | $ | 669 | $ | 15,756 | $ | 16,425 |
Six Months Ended | Six Months Ended | ||||||
(dollars in thousands) | June 30, 2018 | June 30, 2017 | |||||
Fair market value, beginning of period | $ | 17,161 | $ | 18,087 | |||
Fair market value, end of period | 18,560 | 17,024 | |||||
Weighted average discount rate | 9.5 | % | 9.5 | % | |||
Forecasted constant prepayment rate assumption | 13.9 | 16.1 |
June 30, 2018 | December 31, 2017 | ||||||||||||||||||||||
(dollars in thousands) | Gross Carrying Value | Accumulated Amortization | Net Carrying Value | Gross Carrying Value | Accumulated Amortization | Net Carrying Value | |||||||||||||||||
Core deposit premium | $ | 44,642 | $ | (43,973 | ) | $ | 669 | $ | 44,642 | $ | (42,636 | ) | $ | 2,006 | |||||||||
Mortgage servicing rights | 65,208 | (49,452 | ) | 15,756 | 64,401 | (48,558 | ) | 15,843 | |||||||||||||||
Total | $ | 109,850 | $ | (93,425 | ) | $ | 16,425 | $ | 109,043 | $ | (91,194 | ) | $ | 17,849 |
Estimated Amortization Expense | |||||||||||
(dollars in thousands) | Core Deposit Premium | Mortgage Servicing Rights | Total | ||||||||
2018 (remainder) | $ | 669 | $ | 770 | $ | 1,439 | |||||
2019 | — | 1,323 | 1,323 | ||||||||
2020 | — | 1,113 | 1,113 | ||||||||
2021 | — | 934 | 934 | ||||||||
2022 | — | 793 | 793 | ||||||||
2023 | — | 698 | 698 | ||||||||
Thereafter | — | 10,125 | 10,125 | ||||||||
$ | 669 | $ | 15,756 | $ | 16,425 |
Derivatives Financial Instruments Not Designated as Hedging Instruments | Asset Derivatives | Liability Derivatives | ||||||||||||||||
Fair Value at | Fair Value at | |||||||||||||||||
(dollars in thousands) | Balance Sheet Location | June 30, 2018 | December 31, 2017 | June 30, 2018 | December 31, 2017 | |||||||||||||
Interest rate lock and forward sale commitments | Other assets / other liabilities | $ | 22 | $ | 35 | $ | 51 | $ | 49 |
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 June 30, 2018 | ||||||
Interest rate lock and forward sale commitments | Mortgage banking income | $ | (36 | ) | ||
Loans held for sale | Other income | 7 | ||||
Three Months Ended June 30, 2017 | ||||||
Interest rate lock and forward sale commitments | Mortgage banking income | 80 | ||||
Loans held for sale | Other income | (3 | ) | |||
Six Months Ended June 30, 2018 | ||||||
Interest rate lock and forward sale commitments | Mortgage banking income | (15 | ) | |||
Loans held for sale | Other income | — | ||||
Six Months Ended June 30, 2017 | ||||||
Interest rate lock and forward sale commitments | Mortgage banking income | (127 | ) | |||
Loans held for sale | Other income | (3 | ) |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
(dollars in thousands) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Other operating income: | |||||||||||||||
In-scope of ASC 606 | |||||||||||||||
Service charges on deposit accounts | $ | 1,977 | $ | 2,120 | $ | 3,980 | $ | 4,156 | |||||||
Other service charges on deposit accounts | 2,835 | 2,513 | 5,391 | 4,724 | |||||||||||
Income on fiduciary activities | 1,017 | 964 | 1,973 | 1,828 | |||||||||||
Fees on foreign exchange | 28 | 44 | 60 | 83 | |||||||||||
Loan placement fees | 220 | 146 | 417 | 280 | |||||||||||
Net gain on sales of foreclosed assets | — | 84 | — | 186 | |||||||||||
In-scope other operating income | 6,077 | 5,871 | 11,821 | 11,257 | |||||||||||
Out-of-scope other operating income | 3,553 | 1,999 | 6,763 | 6,627 | |||||||||||
Total other operating income | $ | 9,630 | $ | 7,870 | $ | 18,584 | $ | 17,884 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
(dollars in thousands) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Mortgage banking income: | |||||||||||||||
Loan servicing fees | $ | 1,289 | $ | 1,340 | $ | 2,600 | $ | 2,698 | |||||||
Amortization of mortgage servicing rights | (437 | ) | (547 | ) | (894 | ) | (1,067 | ) | |||||||
Gain on sale of residential mortgage loans | 959 | 1,084 | 1,931 | 2,396 | |||||||||||
Unrealized gain (loss) on interest rate locks | (36 | ) | 80 | (15 | ) | (127 | ) | ||||||||
Total mortgage banking income | $ | 1,775 | $ | 1,957 | $ | 3,622 | $ | 3,900 |
Shares | Weighted Average Grant Date Fair Value | |||||
Non-vested restricted stock awards and units, beginning of period | 397,551 | $ | 25.49 | |||
Changes during the period: | ||||||
Granted | 112,794 | 29.55 | ||||
Vested | (110,336 | ) | 24.36 | |||
Forfeited | (18,977 | ) | 27.47 | |||
Non-vested restricted stock awards and units, end of period | 381,032 | 26.93 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
(dollars in thousands) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Interest cost | $ | 167 | $ | 233 | $ | 398 | $ | 462 | |||||||
Expected return on plan assets | (345 | ) | (264 | ) | (604 | ) | (528 | ) | |||||||
Amortization of net actuarial loss | 192 | 300 | 490 | 596 | |||||||||||
Net periodic cost | $ | 14 | $ | 269 | $ | 284 | $ | 530 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
(dollars in thousands) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Interest cost | $ | 98 | $ | 100 | $ | 195 | $ | 215 | |||||||
Amortization of net actuarial loss | 43 | 25 | 86 | 51 | |||||||||||
Amortization of net transition obligation | 4 | 5 | 9 | 9 | |||||||||||
Amortization of prior service cost | 4 | 4 | 9 | 8 | |||||||||||
Settlement | — | 138 | — | 138 | |||||||||||
Net periodic cost | $ | 149 | $ | 272 | $ | 299 | $ | 421 |
(dollars in thousands) | Before Tax | Tax Effect | Net of Tax | ||||||||
Three Months Ended June 30, 2018 | |||||||||||
Net unrealized losses on investment securities: | |||||||||||
Net unrealized losses arising during the period | $ | (5,057 | ) | $ | (1,388 | ) | $ | (3,669 | ) | ||
Less: Reclassification adjustments from AOCI realized in net income | — | — | — | ||||||||
Net unrealized losses on investment securities | (5,057 | ) | (1,388 | ) | (3,669 | ) | |||||
Defined benefit plans: | |||||||||||
Amortization of net actuarial loss | 235 | 91 | 144 | ||||||||
Amortization of net transition obligation | 4 | 1 | 3 | ||||||||
Amortization of prior service cost | 4 | 1 | 3 | ||||||||
Defined benefit plans, net | 243 | 93 | 150 | ||||||||
Other comprehensive loss | $ | (4,814 | ) | $ | (1,295 | ) | $ | (3,519 | ) |
(dollars in thousands) | Before Tax | Tax Effect | Net of Tax | ||||||||
Three Months Ended June 30, 2017 | |||||||||||
Net unrealized gains on investment securities: | |||||||||||
Net unrealized gains arising during the period | $ | 3,001 | $ | 1,193 | $ | 1,808 | |||||
Less: Reclassification adjustments from AOCI realized in net income | 1,640 | 653 | 987 | ||||||||
Net unrealized gains on investment securities | 4,641 | 1,846 | 2,795 | ||||||||
Defined benefit plans: | |||||||||||
Amortization of net actuarial loss | 325 | 222 | 103 | ||||||||
Amortization of net transition obligation | 5 | 2 | 3 | ||||||||
Amortization of prior service cost | 4 | 2 | 2 | ||||||||
Settlement | 138 | 56 | 82 | ||||||||
Defined benefit plans, net | 472 | 282 | 190 | ||||||||
Other comprehensive income | $ | 5,113 | $ | 2,128 | $ | 2,985 |
(dollars in thousands) | Before Tax | Tax Effect | Net of Tax | ||||||||
Six Months Ended June 30, 2018 | |||||||||||
Net unrealized losses on investment securities: | |||||||||||
Net unrealized losses arising during the period | $ | (25,512 | ) | $ | (6,872 | ) | $ | (18,640 | ) | ||
Less: Reclassification adjustments from AOCI realized in net income | — | — | — | ||||||||
Net unrealized losses on investment securities | (25,512 | ) | (6,872 | ) | (18,640 | ) | |||||
Defined benefit plans: | |||||||||||
Amortization of net actuarial loss | 576 | 184 | 392 | ||||||||
Amortization of net transition obligation | 9 | 2 | 7 | ||||||||
Amortization of prior service cost | 9 | 2 | 7 | ||||||||
Defined benefit plans, net | 594 | 188 | 406 | ||||||||
Other comprehensive loss | $ | (24,918 | ) | $ | (6,684 | ) | $ | (18,234 | ) | ||
(dollars in thousands) | Before Tax | Tax Effect | Net of Tax | ||||||||
Six Months Ended June 30, 2017 | |||||||||||
Net unrealized gains on investment securities: | |||||||||||
Net unrealized gains arising during the period | $ | 6,528 | $ | 2,596 | $ | 3,932 | |||||
Less: Reclassification adjustments from AOCI realized in net income | 1,640 | 653 | 987 | ||||||||
Net unrealized gains on investment securities | 8,168 | 3,249 | 4,919 | ||||||||
Defined benefit plans: | |||||||||||
Net actuarial losses arising during the period | (1,042 | ) | (415 | ) | (627 | ) | |||||
Amortization of net actuarial loss | 647 | 287 | 360 | ||||||||
Amortization of net transition obligation | 9 | 3 | 6 | ||||||||
Amortization of prior service cost | 8 | 3 | 5 | ||||||||
Settlement | 138 | 56 | 82 | ||||||||
Defined benefit plans, net | (240 | ) | (66 | ) | (174 | ) | |||||
Other comprehensive income | $ | 7,928 | $ | 3,183 | $ | 4,745 | |||||
(dollars in thousands) | Investment Securities | Defined Benefit Plans | AOCI | ||||||||
Three Months Ended June 30, 2018 | |||||||||||
Balance at beginning of period | $ | (10,492 | ) | $ | (7,237 | ) | $ | (17,729 | ) | ||
Other comprehensive income (loss) before reclassifications | (3,669 | ) | — | (3,669 | ) | ||||||
Reclassification adjustments from AOCI | — | 150 | 150 | ||||||||
Total other comprehensive income (loss) | (3,669 | ) | 150 | (3,519 | ) | ||||||
Balance at end of period | $ | (14,161 | ) | $ | (7,087 | ) | $ | (21,248 | ) |
(dollars in thousands) | Investment Securities | Defined Benefit Plans | AOCI | ||||||||
Three Months Ended June 30, 2017 | |||||||||||
Balance at beginning of period | $ | 6,853 | $ | (6,614 | ) | $ | 239 | ||||
Other comprehensive income before reclassifications | 1,808 | — | 1,808 | ||||||||
Reclassification adjustments from AOCI | 987 | 190 | 1,177 | ||||||||
Total other comprehensive income | 2,795 | 190 | 2,985 | ||||||||
Balance at end of period | $ | 9,648 | $ | (6,424 | ) | $ | 3,224 |
(dollars in thousands) | Investment Securities | Defined Benefit Plans | AOCI | ||||||||
Six Months Ended June 30, 2018 | |||||||||||
Balance at beginning of period | $ | 5,073 | $ | (6,112 | ) | $ | (1,039 | ) | |||
Impact of the adoption of new accounting standards | (139 | ) | — | (139 | ) | ||||||
Adjusted balance at beginning of period | 4,934 | (6,112 | ) | (1,178 | ) | ||||||
Impact of the adoption of new accounting standards | (455 | ) | (1,381 | ) | (1,836 | ) | |||||
Other comprehensive income (loss) before reclassifications | (18,640 | ) | — | (18,640 | ) | ||||||
Reclassification adjustments from AOCI | — | 406 | 406 | ||||||||
Total other comprehensive income (loss) | (18,640 | ) | 406 | (18,234 | ) | ||||||
Balance at end of period | $ | (14,161 | ) | $ | (7,087 | ) | $ | (21,248 | ) | ||
(dollars in thousands) | Investment Securities | Defined Benefit Plans | AOCI | ||||||||
Six Months Ended June 30, 2017 | |||||||||||
Balance at beginning of period | $ | 4,729 | $ | (6,250 | ) | $ | (1,521 | ) | |||
Other comprehensive income (loss) before reclassifications | 3,932 | (627 | ) | 3,305 | |||||||
Reclassification adjustments from AOCI | 987 | 453 | 1,440 | ||||||||
Total other comprehensive income (loss) | 4,919 | (174 | ) | 4,745 | |||||||
Balance at end of period | $ | 9,648 | $ | (6,424 | ) | $ | 3,224 | ||||
Amount Reclassified from AOCI | Affected Line Item in the Statement Where Net Income is Presented | ||||||||
Details about AOCI Components | Three months ended June 30, | ||||||||
(dollars in thousands) | 2018 | 2017 | |||||||
Sale of investment securities available-for-sale | $ | — | $ | (1,640 | ) | Investment securities gains (losses) | |||
— | 653 | Income tax benefit (expense) | |||||||
$ | — | $ | (987 | ) | Net of tax | ||||
Amortization of defined benefit retirement and supplemental executive retirement plan items | |||||||||
Net actuarial loss | $ | (235 | ) | $ | (325 | ) | (1) | ||
Net transition obligation | (4 | ) | (5 | ) | (1) | ||||
Prior service cost | (4 | ) | (4 | ) | (1) | ||||
Settlement | — | (138 | ) | (1) | |||||
(243 | ) | (472 | ) | Total before tax | |||||
93 | 282 | Income tax benefit (expense) | |||||||
$ | (150 | ) | $ | (190 | ) | Net of tax | |||
Total reclassification adjustments from AOCI for the period | $ | (150 | ) | $ | (1,177 | ) | Net of tax |
Amount Reclassified from AOCI | Affected Line Item in the Statement Where Net Income is Presented | ||||||||
Details about AOCI Components | Six months ended June 30, | ||||||||
(dollars in thousands) | 2018 | 2017 | |||||||
Sale of investment securities available-for-sale | $ | — | $ | (1,640 | ) | Investment securities gains (losses) | |||
— | 653 | Income tax benefit (expense) | |||||||
$ | — | $ | (987 | ) | Net of tax | ||||
Amortization of defined benefit retirement and supplemental executive retirement plan items | |||||||||
Net actuarial loss | $ | (576 | ) | $ | (647 | ) | (1) | ||
Net transition obligation | (9 | ) | (9 | ) | (1) | ||||
Prior service cost | (9 | ) | (8 | ) | (1) | ||||
Settlement | — | (138 | ) | (1) | |||||
(594 | ) | (802 | ) | Total before tax | |||||
188 | 349 | Income tax benefit (expense) | |||||||
$ | (406 | ) | $ | (453 | ) | Net of tax | |||
Total reclassification adjustments from AOCI for the period | $ | (406 | ) | $ | (1,440 | ) | Net of tax | ||
(1) | These AOCI components are included in the computation of net periodic pension cost (see Note 15 - Pension and Supplemental Executive Retirement Plans for additional details). |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
(dollars in thousands, except per share data) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Net income | $ | 14,224 | $ | 12,025 | $ | 28,501 | $ | 25,104 | |||||||
Weighted average common shares outstanding - basic | 29,510,175 | 30,568,247 | 29,658,051 | 30,641,165 | |||||||||||
Dilutive effect of employee stock options and awards | 204,767 | 235,478 | 223,483 | 238,758 | |||||||||||
Weighted average common shares outstanding - diluted | 29,714,942 | 30,803,725 | 29,881,534 | 30,879,923 | |||||||||||
Basic earnings per common share | $ | 0.48 | $ | 0.39 | $ | 0.96 | $ | 0.82 | |||||||
Diluted earnings per common share | $ | 0.48 | $ | 0.39 | $ | 0.95 | $ | 0.81 | |||||||
Anti-dilutive employee stock options and awards outstanding | — | 33 | — | 25 |
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) | ||||||||||||||
June 30, 2018 | |||||||||||||||||||
Financial assets | |||||||||||||||||||
Cash and due from banks | $ | 75,547 | $ | 75,547 | $ | 75,547 | $ | — | $ | — | |||||||||
Interest-bearing deposits in other banks | 13,948 | 13,948 | 13,948 | — | — | ||||||||||||||
Investment securities | 1,438,969 | 1,433,143 | 844 | 1,420,965 | 11,334 | ||||||||||||||
Loans held for sale | 9,096 | 9,096 | — | 9,096 | — | ||||||||||||||
Net loans and leases | 3,833,400 | 3,730,643 | — | 19,834 | 3,710,809 | ||||||||||||||
Mortgage servicing rights | 15,756 | 18,560 | — | — | 18,560 | ||||||||||||||
Federal Home Loan Bank stock | 10,246 | N/A | N/A | N/A | N/A | ||||||||||||||
Financial liabilities | |||||||||||||||||||
Deposits: | |||||||||||||||||||
Noninterest-bearing demand | 1,365,010 | 1,365,010 | 1,365,010 | — | — | ||||||||||||||
Interest-bearing demand and savings and money market | 2,455,275 | 2,455,275 | 2,455,275 | — | — | ||||||||||||||
Time | 1,158,814 | 1,151,237 | — | — | 1,151,237 | ||||||||||||||
Short-term borrowings | 87,000 | 87,000 | — | 87,000 | — | ||||||||||||||
Long-term debt | 92,785 | 88,407 | — | 88,407 | — | ||||||||||||||
Off-balance sheet financial instruments | |||||||||||||||||||
Commitments to extend credit | 1,039,452 | 1,302 | — | 1,302 | — | ||||||||||||||
Standby letters of credit and financial guarantees written | 13,049 | 196 | — | 196 | — | ||||||||||||||
Derivatives: | |||||||||||||||||||
Interest rate lock commitments | 3,686 | 14 | — | 14 | — | ||||||||||||||
Forward sale commitments | 12,740 | (43 | ) | — | (43 | ) | — |
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, 2017 | |||||||||||||||||||
Financial assets | |||||||||||||||||||
Cash and due from banks | $ | 75,318 | $ | 75,318 | $ | 75,318 | $ | — | $ | — | |||||||||
Interest-bearing deposits in other banks | 6,975 | 6,975 | 6,975 | — | — | ||||||||||||||
Investment securities | 1,496,644 | 1,494,092 | 825 | 1,481,473 | 11,794 | ||||||||||||||
Loans held for sale | 16,336 | 16,336 | — | 16,336 | — | ||||||||||||||
Net loans and leases | 3,720,614 | 3,684,834 | — | 21,280 | 3,663,554 | ||||||||||||||
Mortgage servicing rights | 15,843 | 17,161 | — | — | 17,161 | ||||||||||||||
Federal Home Loan Bank stock | 7,761 | N/A | N/A | N/A | N/A | ||||||||||||||
Financial liabilities | |||||||||||||||||||
Deposits: | |||||||||||||||||||
Noninterest-bearing demand | 1,395,556 | 1,395,556 | 1,395,556 | — | — | ||||||||||||||
Interest-bearing demand and savings and money market | 2,414,930 | 2,414,930 | 2,414,930 | — | — | ||||||||||||||
Time | 1,145,868 | 1,140,064 | — | — | 1,140,064 | ||||||||||||||
Short-term borrowings | 32,000 | 32,000 | — | 32,000 | — | ||||||||||||||
Long-term debt | 92,785 | 70,139 | — | 70,139 | — | ||||||||||||||
Off-balance sheet financial instruments | |||||||||||||||||||
Commitments to extend credit | 917,405 | 1,140 | — | 1,140 | — | ||||||||||||||
Standby letters of credit and financial guarantees written | 13,551 | 203 | — | 203 | — | ||||||||||||||
Derivatives: | |||||||||||||||||||
Interest rate lock commitments | 2,494 | 12 | — | 12 | — | ||||||||||||||
Forward sale commitments | 18,748 | (26 | ) | — | (26 | ) | — |
• | 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) | |||||||||||
June 30, 2018 | |||||||||||||||
Available-for-sale securities: | |||||||||||||||
Debt securities: | |||||||||||||||
States and political subdivisions | $ | 175,918 | $ | — | $ | 164,584 | $ | 11,334 | |||||||
Corporate securities | 65,432 | — | 65,432 | — | |||||||||||
U.S. Treasury obligations and direct obligations of U.S Government agencies | 35,503 | — | 35,503 | — | |||||||||||
Mortgage-backed securities: | |||||||||||||||
Residential - U.S. Government sponsored entities | 773,725 | — | 773,725 | — | |||||||||||
Commercial - U.S. Government agencies and sponsored entities | 52,423 | — | 52,423 | — | |||||||||||
Residential - Non-government agencies | 42,846 | — | 42,846 | — | |||||||||||
Commercial - Non-government agencies | 134,122 | — | 134,122 | — | |||||||||||
Total available-for-sale securities | 1,279,969 | — | 1,268,635 | 11,334 | |||||||||||
Equity securities | 844 | 844 | — | — | |||||||||||
Derivatives: Interest rate lock and forward sale commitments | (29 | ) | — | (29 | ) | — | |||||||||
Total | $ | 1,280,784 | $ | 844 | $ | 1,268,606 | $ | 11,334 |
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, 2017 | |||||||||||||||
Available-for-sale securities: | |||||||||||||||
Debt securities: | |||||||||||||||
States and political subdivisions | $ | 179,781 | $ | — | $ | 167,987 | $ | 11,794 | |||||||
Corporate securities | 74,278 | — | 74,278 | — | |||||||||||
U.S. Treasury obligations and direct obligations of U.S Government agencies | 25,510 | — | 25,510 | — | |||||||||||
Mortgage-backed securities: | |||||||||||||||
Residential - U.S. Government sponsored entities | 800,683 | — | 800,683 | — | |||||||||||
Commercial - U.S. Government agencies and sponsored entities | 39,725 | — | 39,725 | — | |||||||||||
Residential - Non-government agencies | 46,763 | — | 46,763 | — | |||||||||||
Commercial - Non-government agencies | 137,326 | — | 137,326 | — | |||||||||||
Total available-for-sale securities | 1,304,066 | — | 1,292,272 | 11,794 | |||||||||||
Equity securities | 825 | 825 | — | — | |||||||||||
Derivatives: Interest rate lock and forward sale commitments | (14 | ) | — | (14 | ) | — | |||||||||
Total | $ | 1,304,877 | $ | 825 | $ | 1,292,258 | $ | 11,794 |
(dollars in thousands) | Available for Sale Debt Securities: States and Political Subdivisions | ||
Balance at December 31, 2017 | $ | 11,794 | |
Principal payments received | (189 | ) | |
Unrealized net gain (loss) included in other comprehensive income | (271 | ) | |
Balance at June 30, 2018 | $ | 11,334 | |
Balance at December 31, 2016 | $ | 12,196 | |
Principal payments received | (183 | ) | |
Unrealized net gain (loss) included in other comprehensive income | 176 | ||
Balance at June 30, 2017 | $ | 12,189 |
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) | |||||||||||
June 30, 2018 | |||||||||||||||
Impaired loans (1) | $ | 19,834 | $ | — | $ | 19,834 | $ | — | |||||||
Mortgage servicing rights | 18,560 | — | — | 18,560 | |||||||||||
Other real estate (2) | 595 | — | 595 | — | |||||||||||
December 31, 2017 | |||||||||||||||
Impaired loans (1) | $ | 21,280 | $ | — | $ | 21,280 | $ | — | |||||||
Mortgage servicing rights | 17,161 | — | — | 17,161 | |||||||||||
Other real estate (2) | 851 | — | 851 | — |
(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 June 30, 2018 | |||||||||||||||
Net interest income | $ | 37,281 | $ | 5,391 | $ | — | $ | 42,672 | |||||||
Inter-segment net interest income (expense) | 6,915 | (4,941 | ) | (1,974 | ) | — | |||||||||
Credit (provision) for loan and lease losses | (532 | ) | — | — | (532 | ) | |||||||||
Other operating income: | |||||||||||||||
Mortgage banking income | 923 | — | 852 | 1,775 | |||||||||||
Service charges on deposit accounts | 1,977 | — | — | 1,977 | |||||||||||
Other service charges and fees | 1,287 | 8 | 2,082 | 3,377 | |||||||||||
Income from fiduciary activities | 1,017 | — | — | 1,017 | |||||||||||
Equity in earnings of unconsolidated subsidiaries | 37 | — | — | 37 | |||||||||||
Fees on foreign exchange | 29 | 248 | — | 277 | |||||||||||
Income from bank-owned life insurance | — | 501 | — | 501 | |||||||||||
Loan placement fees | 220 | — | — | 220 | |||||||||||
Other | 200 | 2 | 247 | 449 | |||||||||||
Other operating income | 5,690 | 759 | 3,181 | 9,630 | |||||||||||
Other operating expense | (15,777 | ) | (358 | ) | (17,589 | ) | (33,724 | ) | |||||||
Administrative and overhead expense allocation | (15,167 | ) | (223 | ) | 15,390 | — | |||||||||
Income before taxes | 18,410 | 628 | (992 | ) | 18,046 | ||||||||||
Income tax (expense) benefit | (3,898 | ) | (133 | ) | 209 | (3,822 | ) | ||||||||
Net income (loss) | $ | 14,512 | $ | 495 | $ | (783 | ) | $ | 14,224 |
(dollars in thousands) | Banking Operations | Treasury | All Others | Total | |||||||||||
Three Months Ended June 30, 2017 | |||||||||||||||
Net interest income | $ | 34,558 | $ | 7,071 | $ | — | $ | 41,629 | |||||||
Inter-segment net interest income (expense) | 8,161 | (6,339 | ) | (1,822 | ) | — | |||||||||
Credit (provision) for loan and lease losses | 2,282 | — | — | 2,282 | |||||||||||
Other operating income: | |||||||||||||||
Mortgage banking income | 1,149 | — | 808 | 1,957 | |||||||||||
Service charges on deposit accounts | 2,121 | (1 | ) | — | 2,120 | ||||||||||
Other service charges and fees | 1,147 | — | 1,906 | 3,053 | |||||||||||
Income from fiduciary activities | 964 | — | — | 964 | |||||||||||
Equity in earnings of unconsolidated subsidiaries | 151 | — | — | 151 | |||||||||||
Fees on foreign exchange | 24 | 122 | (16 | ) | 130 | ||||||||||
Investments securities gains (losses) | — | (1,640 | ) | — | (1,640 | ) | |||||||||
Income from bank-owned life insurance | — | 583 | — | 583 | |||||||||||
Loan placement fees | 146 | — | — | 146 | |||||||||||
Net gain (loss) sale of foreclosed assets | — | — | 84 | 84 | |||||||||||
Other | 142 | 3 | 177 | 322 | |||||||||||
Other operating income | 5,844 | (933 | ) | 2,959 | 7,870 | ||||||||||
Other operating expense | (14,835 | ) | (322 | ) | (17,178 | ) | (32,335 | ) | |||||||
Administrative and overhead expense allocation | (15,021 | ) | (228 | ) | 15,249 | — | |||||||||
Income before taxes | 20,989 | (751 | ) | (792 | ) | 19,446 | |||||||||
Income tax (expense) benefit | (7,964 | ) | 240 | 303 | (7,421 | ) | |||||||||
Net income (loss) | $ | 13,025 | $ | (511 | ) | $ | (489 | ) | $ | 12,025 |
(dollars in thousands) | Banking Operations | Treasury | All Others | Total | |||||||||||
Six Months Ended June 30, 2018 | |||||||||||||||
Net interest income | $ | 73,423 | $ | 11,571 | $ | — | $ | 84,994 | |||||||
Inter-segment net interest income (expense) | 13,836 | (10,390 | ) | (3,446 | ) | — | |||||||||
Credit (provision) for loan and lease losses | (321 | ) | — | — | (321 | ) | |||||||||
Other operating income: | |||||||||||||||
Mortgage banking income | 1,916 | — | 1,706 | 3,622 | |||||||||||
Service charges on deposit accounts | 3,980 | — | — | 3,980 | |||||||||||
Other service charges and fees | 2,430 | 14 | 3,967 | 6,411 | |||||||||||
Income from fiduciary activities | 1,973 | — | — | 1,973 | |||||||||||
Equity in earnings of unconsolidated subsidiaries | 80 | — | — | 80 | |||||||||||
Fees on foreign exchange | 53 | 435 | — | 488 | |||||||||||
Investments securities gains (losses) | — | — | — | — | |||||||||||
Income from bank-owned life insurance | — | 819 | — | 819 | |||||||||||
Loan placement fees | 417 | — | — | 417 | |||||||||||
Net gain (loss) sale of foreclosed assets | — | — | — | — | |||||||||||
Other | 355 | 2 | 437 | 794 | |||||||||||
Other operating income | 11,204 | 1,270 | 6,110 | 18,584 | |||||||||||
Other operating expense | (31,702 | ) | (743 | ) | (34,797 | ) | (67,242 | ) | |||||||
Administrative and overhead expense allocation | (30,113 | ) | (446 | ) | 30,559 | — | |||||||||
Income before taxes | 36,327 | 1,262 | (1,574 | ) | 36,015 | ||||||||||
Income tax (expense) benefit | (7,579 | ) | (263 | ) | 328 | (7,514 | ) | ||||||||
Net income (loss) | $ | 28,748 | $ | 999 | $ | (1,246 | ) | $ | 28,501 | ||||||
(dollars in thousands) | Banking Operations | Treasury | All Others | Total | |||||||||||
Six Months Ended June 30, 2017 | |||||||||||||||
Net interest income | $ | 68,648 | $ | 14,236 | $ | — | $ | 82,884 | |||||||
Inter-segment net interest income (expense) | 16,088 | (12,529 | ) | (3,559 | ) | — | |||||||||
Credit (provision) for loan and lease losses | 2,362 | — | — | 2,362 | |||||||||||
Other operating income: | |||||||||||||||
Mortgage banking income | 2,269 | — | 1,631 | 3,900 | |||||||||||
Service charges on deposit accounts | 4,156 | — | — | 4,156 | |||||||||||
Other service charges and fees | 1,985 | — | 3,816 | 5,801 | |||||||||||
Income from fiduciary activities | 1,828 | — | — | 1,828 | |||||||||||
Equity in earnings of unconsolidated subsidiaries | 212 | — | — | 212 | |||||||||||
Fees on foreign exchange | 42 | 251 | — | 293 | |||||||||||
Investments securities gains (losses) | — | (1,640 | ) | — | (1,640 | ) | |||||||||
Income from bank-owned life insurance | — | 1,700 | — | 1,700 | |||||||||||
Loan placement fees | 280 | — | — | 280 | |||||||||||
Net gain (loss) sale of foreclosed assets | — | — | 186 | 186 | |||||||||||
Other | 796 | 17 | 355 | 1,168 | |||||||||||
Other operating income | 11,568 | 328 | 5,988 | 17,884 | |||||||||||
Other operating expense | (29,853 | ) | (710 | ) | (33,232 | ) | (63,795 | ) | |||||||
Administrative and overhead expense allocation | (28,725 | ) | (430 | ) | 29,155 | — | |||||||||
Income before taxes | 40,088 | 895 | (1,648 | ) | 39,335 | ||||||||||
Income tax (expense) benefit | (14,504 | ) | (324 | ) | 597 | (14,231 | ) | ||||||||
Net income | $ | 25,584 | $ | 571 | $ | (1,051 | ) | $ | 25,104 | ||||||
(dollars in thousands) | Banking Operations | Treasury | All Others | Total | |||||||||||
June 30, 2018 | |||||||||||||||
Investment securities | $ | — | $ | 1,438,969 | $ | — | $ | 1,438,969 | |||||||
Loans and leases (including loans held for sale) | 3,890,677 | — | — | 3,890,677 | |||||||||||
Other | 41,612 | 238,123 | 72,138 | 351,873 | |||||||||||
Total assets | $ | 3,932,289 | $ | 1,677,092 | $ | 72,138 | $ | 5,681,519 |
(dollars in thousands) | Banking Operations | Treasury | All Others | Total | |||||||||||
December 31, 2017 | |||||||||||||||
Investment securities | $ | — | $ | 1,496,644 | $ | — | $ | 1,496,644 | |||||||
Loans and leases (including loans held for sale) | 3,786,951 | — | — | 3,786,951 | |||||||||||
Other | 42,243 | 228,608 | 69,262 | 340,113 | |||||||||||
Total assets | $ | 3,829,194 | $ | 1,725,252 | $ | 69,262 | $ | 5,623,708 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Return on average assets | 1.00 | % | 0.88 | % | 1.01 | % | 0.92 | % | |||||||
Return on average shareholders’ equity | 11.83 | 9.32 | 11.72 | 9.78 | |||||||||||
Basic earnings per common share | $ | 0.48 | $ | 0.39 | $ | 0.96 | $ | 0.82 | |||||||
Diluted earnings per common share | 0.48 | 0.39 | 0.95 | 0.81 |
(dollars in thousands) | Three Months Ended June 30, | |||||||||||||||||||||||||||||||
2018 | 2017 | 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 | $ | 26,300 | 1.78 | % | 117 | $ | 22,840 | 1.07 | % | 61 | $ | 3,460 | 0.71 | % | 56 | |||||||||||||||||
Investment securities, excluding valuation allowance: | ||||||||||||||||||||||||||||||||
Taxable (1) | 1,341,717 | 2.60 | 8,720 | 1,344,467 | 2.53 | 8,493 | (2,750 | ) | 0.07 | 227 | ||||||||||||||||||||||
Tax-exempt (1) | 164,196 | 2.87 | 1,181 | 170,168 | 3.52 | 1,499 | (5,972 | ) | (0.65 | ) | (318 | ) | ||||||||||||||||||||
Total investment securities | 1,505,913 | 2.63 | 9,901 | 1,514,635 | 2.64 | 9,992 | (8,722 | ) | (0.01 | ) | (91 | ) | ||||||||||||||||||||
Loans and leases, including loans held for sale (2) | 3,836,739 | 4.04 | 38,699 | 3,593,347 | 3.96 | 35,531 | 243,392 | 0.08 | 3,168 | |||||||||||||||||||||||
Federal Home Loan Bank stock | 7,163 | 2.24 | 40 | 7,216 | 1.17 | 21 | (53 | ) | 1.07 | 19 | ||||||||||||||||||||||
Total interest earning assets | 5,376,115 | 3.63 | 48,757 | 5,138,038 | 3.55 | 45,605 | 238,077 | 0.08 | 3,152 | |||||||||||||||||||||||
Noninterest-earning assets | 287,582 | 329,423 | (41,841 | ) | ||||||||||||||||||||||||||||
Total assets | $ | 5,663,697 | $ | 5,467,461 | $ | 196,236 | ||||||||||||||||||||||||||
Liabilities and Equity | ||||||||||||||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||||||||||
Interest-bearing demand deposits | $ | 951,597 | 0.08 | % | 193 | $ | 890,827 | 0.07 | % | 154 | $ | 60,770 | 0.01 | % | 39 | |||||||||||||||||
Savings and money market deposits | 1,495,884 | 0.12 | 459 | 1,426,092 | 0.07 | 259 | 69,792 | 0.05 | 200 | |||||||||||||||||||||||
Time deposits under $100,000 | 178,459 | 0.48 | 214 | 191,833 | 0.39 | 188 | (13,374 | ) | 0.09 | 26 | ||||||||||||||||||||||
Time deposits $100,000 and over | 1,047,428 | 1.46 | 3,820 | 981,174 | 0.80 | 1,948 | 66,254 | 0.66 | 1,872 | |||||||||||||||||||||||
Total interest-bearing deposits | 3,673,368 | 0.51 | 4,686 | 3,489,926 | 0.29 | 2,549 | 183,442 | 0.22 | 2,137 | |||||||||||||||||||||||
Short-term borrowings | 9,900 | 1.96 | 48 | 18,050 | 1.03 | 46 | (8,150 | ) | 0.93 | 2 | ||||||||||||||||||||||
Long-term debt | 92,785 | 4.77 | 1,103 | 92,785 | 3.70 | 856 | — | 1.07 | 247 | |||||||||||||||||||||||
Total interest-bearing liabilities | 3,776,053 | 0.62 | 5,837 | 3,600,761 | 0.38 | 3,451 | 175,292 | 0.24 | 2,386 | |||||||||||||||||||||||
Noninterest-bearing deposits | 1,367,796 | 1,310,889 | 56,907 | |||||||||||||||||||||||||||||
Other liabilities | 38,863 | 39,812 | (949 | ) | ||||||||||||||||||||||||||||
Total liabilities | 5,182,712 | 4,951,462 | 231,250 | |||||||||||||||||||||||||||||
Shareholders’ equity | 480,985 | 515,974 | (34,989 | ) | ||||||||||||||||||||||||||||
Non-controlling interest | — | 25 | (25 | ) | ||||||||||||||||||||||||||||
Total equity | 480,985 | 515,999 | (35,014 | ) | ||||||||||||||||||||||||||||
Total liabilities and equity | $ | 5,663,697 | $ | 5,467,461 | $ | 196,236 | ||||||||||||||||||||||||||
Net interest income | $ | 42,920 | $ | 42,154 | $ | 766 | ||||||||||||||||||||||||||
Interest rate spread | 3.01 | % | 3.17 | % | (0.16 | )% | ||||||||||||||||||||||||||
Net interest margin | 3.20 | % | 3.29 | % | (0.09 | )% | ||||||||||||||||||||||||||
(1) At amortized cost. | ||||||||||||||||||||||||||||||||
(2) Includes nonaccrual loans. |
Six Months Ended June 30, | ||||||||||||||||||||||||||||||||
2018 | 2017 | 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 | $ | 24,555 | 1.65 | % | 201 | $ | 31,328 | 0.87 | % | 135 | $ | (6,773 | ) | 0.78 | % | 66 | ||||||||||||||||
Investment securities, excluding valuation allowance: | ||||||||||||||||||||||||||||||||
Taxable investment securities (1) | 1,345,902 | 2.61 | 17,578 | 1,337,232 | 2.49 | 16,640 | 8,670 | 0.12 | 938 | |||||||||||||||||||||||
Tax-exempt investment securities (1) | 164,684 | 2.87 | 2,362 | 170,651 | 3.52 | 3,005 | (5,967 | ) | (0.65 | ) | (643 | ) | ||||||||||||||||||||
Total investment securities | 1,510,586 | 2.64 | 19,940 | 1,507,883 | 2.61 | 19,645 | 2,703 | 0.03 | 295 | |||||||||||||||||||||||
Loans and leases, including loans held for sale (2) | 3,813,169 | 4.01 | 76,089 | 3,570,658 | 3.97 | 70,488 | 242,511 | 0.04 | 5,601 | |||||||||||||||||||||||
Federal Home Loan Bank stock | 7,001 | 2.42 | 85 | 6,995 | 2.20 | 77 | 6 | 0.22 | 8 | |||||||||||||||||||||||
Total interest earning assets | 5,355,311 | 3.61 | 96,315 | 5,116,864 | 3.55 | 90,345 | 238,447 | 0.06 | 5,970 | |||||||||||||||||||||||
Noninterest-earning assets | 295,710 | 328,255 | (32,545 | ) | ||||||||||||||||||||||||||||
Total assets | $ | 5,651,021 | $ | 5,445,119 | $ | 205,902 | ||||||||||||||||||||||||||
Liabilities and Equity | ||||||||||||||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||||||||||
Interest-bearing demand deposits | $ | 943,584 | 0.08 | % | 373 | $ | 885,158 | 0.07 | % | 294 | $ | 58,426 | 0.01 | % | 79 | |||||||||||||||||
Savings and money market deposits | 1,497,642 | 0.11 | 828 | 1,422,775 | 0.07 | 516 | 74,867 | 0.04 | 312 | |||||||||||||||||||||||
Time deposits under $100,000 | 179,000 | 0.46 | 409 | 192,731 | 0.39 | 368 | (13,731 | ) | 0.07 | 41 | ||||||||||||||||||||||
Time deposits $100,000 and over | 1,038,748 | 1.37 | 7,050 | 1,003,553 | 0.70 | 3,485 | 35,195 | 0.67 | 3,565 | |||||||||||||||||||||||
Total interest-bearing deposits | 3,658,974 | 0.48 | 8,660 | 3,504,217 | 0.27 | 4,663 | 154,757 | 0.21 | 3,997 | |||||||||||||||||||||||
Short-term borrowings | 9,356 | 1.97 | 91 | 16,423 | 0.94 | 77 | (7,067 | ) | 1.03 | 14 | ||||||||||||||||||||||
Long-term debt | 92,785 | 4.51 | 2,074 | 92,785 | 3.63 | 1,669 | — | 0.88 | 405 | |||||||||||||||||||||||
Total interest-bearing liabilities | 3,761,115 | 0.58 | 10,825 | 3,613,425 | 0.36 | 6,409 | 147,690 | 0.22 | 4,416 | |||||||||||||||||||||||
Noninterest-bearing deposits | 1,361,776 | 1,277,733 | 84,043 | |||||||||||||||||||||||||||||
Other liabilities | 41,568 | 40,534 | 1,034 | |||||||||||||||||||||||||||||
Total liabilities | 5,164,459 | 4,931,692 | 232,767 | |||||||||||||||||||||||||||||
Shareholders’ equity | 486,554 | 513,403 | (26,849 | ) | ||||||||||||||||||||||||||||
Non-controlling interest | 8 | 24 | (16 | ) | ||||||||||||||||||||||||||||
Total equity | 486,562 | 513,427 | (26,865 | ) | ||||||||||||||||||||||||||||
Total liabilities and equity | $ | 5,651,021 | $ | 5,445,119 | $ | 205,902 | ||||||||||||||||||||||||||
Net interest income | $ | 85,490 | $ | 83,936 | $ | 1,554 | ||||||||||||||||||||||||||
Interest rate spread | 3.03 | % | 3.19 | % | (0.16 | )% | ||||||||||||||||||||||||||
Net interest margin | 3.20 | % | 3.29 | % | (0.09 | )% | ||||||||||||||||||||||||||
(1) At amortized cost. | ||||||||||||||||||||||||||||||||
(2) Includes nonaccrual loans. | ||||||||||||||||||||||||||||||||
Three Months Ended | ||||||||||||||
(dollars in thousands) | June 30, 2018 | June 30, 2017 | $ Change | % Change | ||||||||||
Other operating income: | ||||||||||||||
Mortgage banking income | $ | 1,775 | $ | 1,957 | $ | (182 | ) | -9.3 | % | |||||
Service charges on deposit accounts | 1,977 | 2,120 | (143 | ) | -6.7 | % | ||||||||
Other service charges and fees | 3,377 | 3,053 | 324 | 10.6 | % | |||||||||
Income from fiduciary activities | 1,017 | 964 | 53 | 5.5 | % | |||||||||
Equity in earnings of unconsolidated subsidiaries | 37 | 151 | (114 | ) | -75.5 | % | ||||||||
Fees on foreign exchange | 277 | 130 | 147 | 113.1 | % | |||||||||
Investment securities gains (losses) | — | (1,640 | ) | 1,640 | -100.0 | % | ||||||||
Income from bank-owned life insurance | 501 | 583 | (82 | ) | -14.1 | % | ||||||||
Loan placement fees | 220 | 146 | 74 | 50.7 | % | |||||||||
Net gain on sales of foreclosed assets | — | 84 | (84 | ) | -100.0 | % | ||||||||
Other: | ||||||||||||||
Income recovered on nonaccrual loans previously charged-off | 130 | 25 | 105 | 420.0 | % | |||||||||
Other recoveries | 49 | 54 | (5 | ) | -9.3 | % | ||||||||
Commissions on sale of checks | 84 | 85 | (1 | ) | -1.2 | % | ||||||||
Other | 186 | 158 | 28 | 17.7 | % | |||||||||
Total other operating income | $ | 9,630 | $ | 7,870 | $ | 1,760 | 22.4 | % | ||||||
Six Months Ended | ||||||||||||||
(dollars in thousands) | June 30, 2018 | June 30, 2017 | $ Change | % Change | ||||||||||
Other operating income: | ||||||||||||||
Mortgage banking income | $ | 3,622 | $ | 3,900 | $ | (278 | ) | -7.1 | % | |||||
Service charges on deposit accounts | 3,980 | 4,156 | (176 | ) | -4.2 | % | ||||||||
Other service charges and fees | 6,411 | 5,801 | 610 | 10.5 | % | |||||||||
Income from fiduciary activities | 1,973 | 1,828 | 145 | 7.9 | % | |||||||||
Equity in earnings of unconsolidated subsidiaries | 80 | 212 | (132 | ) | -62.3 | % | ||||||||
Fees on foreign exchange | 488 | 293 | 195 | 66.6 | % | |||||||||
Investment securities gains (losses) | — | (1,640 | ) | 1,640 | -100.0 | % | ||||||||
Income from bank-owned life insurance | 819 | 1,700 | (881 | ) | -51.8 | % | ||||||||
Loan placement fees | 417 | 280 | 137 | 48.9 | % | |||||||||
Net gain on sales of foreclosed assets | — | 186 | (186 | ) | -100.0 | % | ||||||||
Other: | ||||||||||||||
Income recovered on nonaccrual loans previously charged-off | 226 | 586 | (360 | ) | -61.4 | % | ||||||||
Other recoveries | 95 | 91 | 4 | 4.4 | % | |||||||||
Commissions on sale of checks | 170 | 172 | (2 | ) | -1.2 | % | ||||||||
Other | 303 | 319 | (16 | ) | -5.0 | % | ||||||||
Total other operating income | $ | 18,584 | $ | 17,884 | $ | 700 | 3.9 | % | ||||||
Three Months Ended | ||||||||||||||
(dollars in thousands) | June 30, 2018 | June 30, 2017 | $ Change | % Change | ||||||||||
Other operating expense: | ||||||||||||||
Salaries and employee benefits | $ | 18,783 | $ | 17,983 | $ | 800 | 4.4 | % | ||||||
Net occupancy | 3,360 | 3,335 | 25 | 0.7 | % | |||||||||
Equipment | 1,044 | 967 | 77 | 8.0 | % | |||||||||
Amortization of core deposit premium | 668 | 669 | (1 | ) | -0.1 | % | ||||||||
Communication expense | 746 | 891 | (145 | ) | -16.3 | % | ||||||||
Legal and professional services | 1,769 | 1,987 | (218 | ) | -11.0 | % | ||||||||
Computer software expense | 2,305 | 2,190 | 115 | 5.3 | % | |||||||||
Advertising expense | 617 | 390 | 227 | 58.2 | % | |||||||||
Foreclosed asset expense | 31 | 63 | (32 | ) | -50.8 | % | ||||||||
Other: | ||||||||||||||
Charitable contributions | 131 | 136 | (5 | ) | -3.7 | % | ||||||||
FDIC insurance assessment | 434 | 429 | 5 | 1.2 | % | |||||||||
Miscellaneous loan expenses | 324 | 293 | 31 | 10.6 | % | |||||||||
ATM and debit card expenses | 698 | 468 | 230 | 49.1 | % | |||||||||
Amortization of investments in low-income housing tax credit partnerships | 113 | 223 | (110 | ) | -49.3 | % | ||||||||
Armored car expenses | 233 | 198 | 35 | 17.7 | % | |||||||||
Entertainment and promotions | 273 | 246 | 27 | 11.0 | % | |||||||||
Stationery and supplies | 236 | 230 | 6 | 2.6 | % | |||||||||
Directors’ fees and expenses | 283 | 250 | 33 | 13.2 | % | |||||||||
Increase (decrease) to the reserve for unfunded commitments | 66 | 53 | 13 | 24.5 | % | |||||||||
Other | 1,610 | 1,334 | 276 | 20.7 | % | |||||||||
Total other operating expense | $ | 33,724 | $ | 32,335 | $ | 1,389 | 4.3 | % | ||||||
Six Months Ended | ||||||||||||||
(dollars in thousands) | June 30, 2018 | June 30, 2017 | $ Change | % Change | ||||||||||
Other operating expense: | ||||||||||||||
Salaries and employee benefits | $ | 37,288 | $ | 35,370 | $ | 1,918 | 5.4 | % | ||||||
Net occupancy | 6,626 | 6,749 | (123 | ) | -1.8 | % | ||||||||
Equipment | 2,112 | 1,809 | 303 | 16.7 | % | |||||||||
Amortization of core deposit premium | 1,337 | 1,337 | — | — | % | |||||||||
Communication expense | 1,644 | 1,791 | (147 | ) | -8.2 | % | ||||||||
Legal and professional services | 3,590 | 3,779 | (189 | ) | -5.0 | % | ||||||||
Computer software expense | 4,572 | 4,442 | 130 | 2.9 | % | |||||||||
Advertising expense | 1,229 | 782 | 447 | 57.2 | % | |||||||||
Foreclosed asset expense | 325 | 99 | 226 | 228.3 | % | |||||||||
Other: | ||||||||||||||
Charitable contributions | 331 | 287 | 44 | 15.3 | % | |||||||||
FDIC insurance assessment | 868 | 853 | 15 | 1.8 | % | |||||||||
Miscellaneous loan expenses | 623 | 554 | 69 | 12.5 | % | |||||||||
ATM and debit card expenses | 1,346 | 918 | 428 | 46.6 | % | |||||||||
Amortization of investments in low-income housing tax credit partnerships | 227 | 456 | (229 | ) | -50.2 | % | ||||||||
Armored car expenses | 399 | 456 | (57 | ) | -12.5 | % | ||||||||
Entertainment and promotions | 432 | 404 | 28 | 6.9 | % | |||||||||
Stationery and supplies | 437 | 408 | 29 | 7.1 | % | |||||||||
Directors’ fees and expenses | 514 | 457 | 57 | 12.5 | % | |||||||||
Increase (decrease) to the reserve for unfunded commitments | 107 | 123 | (16 | ) | -13.0 | % | ||||||||
Other | 3,235 | 2,721 | 514 | 18.9 | % | |||||||||
Total other operating expense | $ | 67,242 | $ | 63,795 | $ | 3,447 | 5.4 | % | ||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
(dollars in thousands) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Total other operating expense | $ | 33,724 | $ | 32,335 | $ | 67,242 | $ | 63,795 | |||||||
Net interest income | $ | 42,672 | $ | 41,629 | $ | 84,994 | $ | 82,884 | |||||||
Total other operating income | 9,630 | 7,870 | 18,584 | 17,884 | |||||||||||
Total revenue | $ | 52,302 | $ | 49,499 | $ | 103,578 | $ | 100,768 | |||||||
Efficiency ratio | 64.48 | % | 65.32 | % | 64.92 | % | 63.31 | % |
(Dollars in thousands) | June 30, 2018 | December 31, 2017 | $ Change | % Change | |||||||||||
Hawaii: | |||||||||||||||
Commercial, financial and agricultural | $ | 411,687 | $ | 400,529 | $ | 11,158 | 2.8 | % | |||||||
Real estate: | |||||||||||||||
Construction | 64,457 | 61,643 | 2,814 | 4.6 | |||||||||||
Residential mortgage | 1,377,219 | 1,341,221 | 35,998 | 2.7 | |||||||||||
Home equity | 430,870 | 412,230 | 18,640 | 4.5 | |||||||||||
Commercial mortgage | 829,647 | 807,009 | 22,638 | 2.8 | |||||||||||
Consumer | 332,040 | 322,713 | 9,327 | 2.9 | |||||||||||
Leases | 223 | 362 | (139 | ) | (38.4 | ) | |||||||||
Total loans and leases | 3,446,143 | 3,345,707 | 100,436 | 3.0 | |||||||||||
Allowance for loan and lease losses | (43,212 | ) | (44,779 | ) | 1,567 | (3.5 | ) | ||||||||
Net loans and leases | $ | 3,402,931 | $ | 3,300,928 | $ | 102,003 | 3.1 | ||||||||
U.S. Mainland: | |||||||||||||||
Commercial, financial and agricultural | $ | 111,608 | $ | 103,490 | $ | 8,118 | 7.8 | ||||||||
Real estate: | |||||||||||||||
Construction | 2,437 | 2,597 | (160 | ) | (6.2 | ) | |||||||||
Residential mortgage | — | — | — | — | |||||||||||
Home equity | — | — | — | — | |||||||||||
Commercial mortgage | 188,543 | 170,788 | 17,755 | 10.4 | |||||||||||
Consumer | 132,850 | 148,033 | (15,183 | ) | (10.3 | ) | |||||||||
Leases | — | — | — | — | |||||||||||
Total loans and leases | 435,438 | 424,908 | 10,530 | 2.5 | |||||||||||
Allowance for loan and lease losses | (4,969 | ) | (5,222 | ) | 253 | (4.8 | ) | ||||||||
Net loans and leases | $ | 430,469 | $ | 419,686 | $ | 10,783 | 2.6 | ||||||||
Total: | |||||||||||||||
Commercial, financial and agricultural | $ | 523,295 | $ | 504,019 | $ | 19,276 | 3.8 | ||||||||
Real estate: | |||||||||||||||
Construction | 66,894 | 64,240 | 2,654 | 4.1 | |||||||||||
Residential mortgage | 1,377,219 | 1,341,221 | 35,998 | 2.7 | |||||||||||
Home equity | 430,870 | 412,230 | 18,640 | 4.5 | |||||||||||
Commercial mortgage | 1,018,190 | 977,797 | 40,393 | 4.1 | |||||||||||
Consumer | 464,890 | 470,746 | (5,856 | ) | (1.2 | ) | |||||||||
Leases | 223 | 362 | (139 | ) | (38.4 | ) | |||||||||
Total loans and leases | 3,881,581 | 3,770,615 | 110,966 | 2.9 | |||||||||||
Allowance for loan and lease losses | (48,181 | ) | (50,001 | ) | 1,820 | (3.6 | ) | ||||||||
Net loans and leases | $ | 3,833,400 | $ | 3,720,614 | $ | 112,786 | 3.0 |
(dollars in thousands) | June 30, 2018 | December 31, 2017 | $ Change | % Change | ||||||||||
Nonperforming Assets | ||||||||||||||
Nonaccrual loans (including loans held for sale): | ||||||||||||||
Real estate: | ||||||||||||||
Residential mortgage | $ | 2,400 | $ | 2,280 | $ | 120 | 5.3 | |||||||
Home equity | 514 | 416 | 98 | 23.6 | ||||||||||
Commercial mortgage | — | 79 | (79 | ) | (100.0 | ) | ||||||||
Total nonaccrual loans | 2,914 | 2,775 | 139 | 5.0 | ||||||||||
Other real estate owned ("OREO"): | ||||||||||||||
Real estate: | ||||||||||||||
Residential mortgage | 595 | 851 | (256 | ) | (30.1 | ) | ||||||||
Total OREO | 595 | 851 | (256 | ) | (30.1 | ) | ||||||||
Total nonperforming assets | 3,509 | 3,626 | (117 | ) | (3.2 | ) | ||||||||
Accruing Loans Delinquent for 90 Days or More | ||||||||||||||
Real estate: | ||||||||||||||
Residential mortgage | 279 | 49 | 230 | 469.4 | ||||||||||
Consumer | 362 | 515 | (153 | ) | (29.7 | ) | ||||||||
Total accruing loans delinquent for 90 days or more | 641 | 564 | 77 | 13.7 | ||||||||||
Restructured Loans Still Accruing Interest | ||||||||||||||
Commercial, financial and agricultural | 423 | 491 | (68 | ) | (13.8 | ) | ||||||||
Real estate: | ||||||||||||||
Residential mortgage | 9,621 | 10,677 | (1,056 | ) | (9.9 | ) | ||||||||
Commercial mortgage | 1,253 | 1,466 | (213 | ) | (14.5 | ) | ||||||||
Total restructured loans still accruing interest | 11,297 | 12,634 | (1,337 | ) | (10.6 | ) | ||||||||
Total nonperforming assets, accruing loans delinquent for 90 days or more and restructured loans still accruing interest | $ | 15,447 | $ | 16,824 | $ | (1,377 | ) | (8.2 | ) | |||||
Ratio of nonaccrual loans to total loans and leases | 0.08 | % | 0.07 | % | 0.01 | % | ||||||||
Ratio of nonperforming assets to total loans and leases and OREO | 0.09 | % | 0.10 | % | (0.01 | )% | ||||||||
Ratio of nonperforming assets and accruing loans delinquent for 90 days or more to total loans and leases and OREO | 0.11 | % | 0.11 | % | — | % | ||||||||
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 | 0.40 | % | 0.45 | % | (0.05 | )% |
Year-to-Date Changes in Nonperforming Assets: | |||
(dollars in thousands) | |||
Balance at December 31, 2017 | $ | 3,626 | |
Additions | 593 | ||
Reductions: | |||
Payments | (192 | ) | |
Return to accrual status | (222 | ) | |
Sales of nonperforming assets | (40 | ) | |
Charge-offs and/or valuation adjustments | (256 | ) | |
Total reductions | (710 | ) | |
Net decrease | (117 | ) | |
Balance at June 30, 2018 | $ | 3,509 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
(dollars in thousands) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Allowance for Loan and Lease Losses: | |||||||||||||||
Balance at beginning of period | $ | 49,217 | $ | 55,369 | $ | 50,001 | $ | 56,631 | |||||||
Provision (credit) for loan and lease losses | 532 | (2,282 | ) | 321 | (2,362 | ) | |||||||||
Charge-offs: | |||||||||||||||
Commercial, financial and agricultural | 742 | 337 | 1,240 | 837 | |||||||||||
Consumer | 1,729 | 1,470 | 3,662 | 2,967 | |||||||||||
Total charge-offs | 2,471 | 1,807 | 4,902 | 3,804 | |||||||||||
Recoveries: | |||||||||||||||
Commercial, financial and agricultural | 295 | 236 | 439 | 511 | |||||||||||
Real estate: | |||||||||||||||
Construction | 6 | 56 | 1,199 | 77 | |||||||||||
Residential mortgage | 21 | 637 | 47 | 733 | |||||||||||
Home equity | 9 | 27 | 12 | 29 | |||||||||||
Commercial mortgage | 29 | 128 | 44 | 139 | |||||||||||
Consumer | 543 | 464 | 1,020 | 874 | |||||||||||
Total recoveries | 903 | 1,548 | 2,761 | 2,363 | |||||||||||
Net charge-offs | 1,568 | 259 | 2,141 | 1,441 | |||||||||||
Balance at end of period | $ | 48,181 | $ | 52,828 | $ | 48,181 | $ | 52,828 | |||||||
Allowance as a percentage of total loans and leases | 1.24 | % | 1.47 | % | 1.24 | % | 1.47 | % | |||||||
Annualized ratio of net charge-offs to average loans and leases | 0.16 | % | 0.03 | % | 0.11 | % | 0.08 | % |
(dollars in thousands) | June 30, 2018 | December 31, 2017 | $ Change | % Change | ||||||||||
Noninterest-bearing demand deposits | $ | 1,365,010 | $ | 1,395,556 | $ | (30,546 | ) | (2.2 | )% | |||||
Interest-bearing demand deposits | 952,991 | 933,054 | 19,937 | 2.1 | ||||||||||
Savings and money market deposits | 1,502,284 | 1,481,876 | 20,408 | 1.4 | ||||||||||
Time deposits less than $100,000 | 175,695 | 180,748 | (5,053 | ) | (2.8 | ) | ||||||||
Core deposits | 3,995,980 | 3,991,234 | 4,746 | 0.1 | ||||||||||
Government time deposits | 727,087 | 687,052 | 40,035 | 5.8 | ||||||||||
Other time deposits $100,000 to $250,000 | 100,971 | 101,560 | (589 | ) | (0.6 | ) | ||||||||
Other time deposits greater than $250,000 | 155,061 | 176,508 | (21,447 | ) | (12.2 | ) | ||||||||
Total time deposits $100,000 and greater | 983,119 | 965,120 | 17,999 | 1.9 | ||||||||||
Total deposits | $ | 4,979,099 | $ | 4,956,354 | $ | 22,745 | 0.5 |
(dollars in thousands) | June 30, 2018 | December 31, 2017 | |||||
Total shareholders' equity | $ | 480,668 | $ | 500,011 | |||
Total common equity | 480,668 | 500,011 | |||||
Less: other intangible assets (core deposit premium) | (669 | ) | (2,006 | ) | |||
Tangible common equity | $ | 479,999 | $ | 498,005 | |||
Total assets | $ | 5,681,519 | $ | 5,623,708 | |||
Less: other intangible assets (core deposit premium) | (669 | ) | (2,006 | ) | |||
Tangible assets | $ | 5,680,850 | $ | 5,621,702 | |||
Tangible common equity ratio | 8.45 | % | 8.86 | % |
Actual | Minimum Required for Capital Adequacy Purposes | Minimum Required to be Well Capitalized | |||||||||||||||||||
(dollars in thousands) | Amount | Ratio | Amount | Ratio | Amount | Ratio | |||||||||||||||
Company | |||||||||||||||||||||
At June 30, 2018: | |||||||||||||||||||||
Leverage capital | $ | 586,799 | 10.3 | % | $ | 227,575 | 4.0 | % | $ | 284,468 | 5.0 | % | |||||||||
Tier 1 risk-based capital | 586,799 | 14.4 | 244,099 | 6.0 | 325,465 | 8.0 | |||||||||||||||
Total risk-based capital | 636,755 | 15.7 | 325,465 | 8.0 | 406,832 | 10.0 | |||||||||||||||
CET1 risk-based capital | 496,799 | 12.2 | 183,074 | 4.5 | 264,441 | 6.5 | |||||||||||||||
At December 31, 2017: | |||||||||||||||||||||
Leverage capital | $ | 578,607 | 10.4 | % | $ | 223,646 | 4.0 | % | $ | 279,557 | 5.0 | % | |||||||||
Tier 1 risk-based capital | 578,607 | 14.7 | 236,721 | 6.0 | 315,628 | 8.0 | |||||||||||||||
Total risk-based capital | 628,068 | 15.9 | 315,628 | 8.0 | 394,535 | 10.0 | |||||||||||||||
CET1 risk-based capital | 490,861 | 12.4 | 177,541 | 4.5 | 256,448 | 6.5 | |||||||||||||||
Central Pacific Bank | |||||||||||||||||||||
At June 30, 2018: | |||||||||||||||||||||
Leverage capital | $ | 569,128 | 10.0 | % | $ | 227,107 | 4.0 | % | $ | 283,884 | 5.0 | % | |||||||||
Tier 1 risk-based capital | 569,128 | 14.0 | 243,400 | 6.0 | 324,534 | 8.0 | |||||||||||||||
Total risk-based capital | 619,084 | 15.3 | 324,534 | 8.0 | 405,667 | 10.0 | |||||||||||||||
CET1 risk-based capital | 569,128 | 14.0 | 182,550 | 4.5 | 263,684 | 6.5 | |||||||||||||||
At December 31, 2017: | |||||||||||||||||||||
Leverage capital | $ | 565,412 | 10.1 | % | $ | 223,431 | 4.0 | % | $ | 279,289 | 5.0 | % | |||||||||
Tier 1 risk-based capital | 565,412 | 14.4 | 236,401 | 6.0 | 315,201 | 8.0 | |||||||||||||||
Total risk-based capital | 614,732 | 15.6 | 315,201 | 8.0 | 394,002 | 10.0 | |||||||||||||||
CET1 risk-based capital | 565,412 | 14.4 | 177,301 | 4.5 | 256,101 | 6.5 |
Rate Change | Estimated Net Interest Income Sensitivity | ||
+100bp | 0.95 | % | |
-100bp | (2.61 | )% |
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 | ||||||||||
April 1-30, 2018 | 121,885 | $ | 29.32 | 121,885 | $ | 39,808,142 | ||||||||
May 1-31, 2018 | 77,500 | 29.76 | 77,500 | 37,501,568 | ||||||||||
June 1-30, 2018 | 70,500 | 29.65 | 70,500 | 35,410,954 | ||||||||||
Total | 269,885 | $ | 29.54 | 269,885 | $ | 35,410,954 |
Exhibit No. | Document | |
31.1 | ||
31.2 | ||
32.1 | ||
32.2 | ||
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* | |
* | Filed herewith. | |
** | Furnished herewith. | |
CENTRAL PACIFIC FINANCIAL CORP. | ||
(Registrant) | ||
Date: | August 7, 2018 | /s/ A. Catherine Ngo |
A. Catherine Ngo | ||
President and Chief Executive Officer | ||
Date: | August 7, 2018 | /s/ David S. Morimoto |
David S. Morimoto | ||
Executive Vice President and Chief Financial Officer |
Exhibit No. | Document | |
31.1 | ||
31.2 | ||
32.1 | ||
32.2 | ||
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* | |
* | Filed herewith. | |
** | Furnished herewith. | |
(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: | August 7, 2018 | /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: | August 7, 2018 | /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: | August 7, 2018 | /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: | August 7, 2018 | /s/ David S. Morimoto |
David S. Morimoto | ||
Executive Vice President and Chief Financial Officer | ||
(Principal Financial and Accounting Officer) |
Document and Entity Information - shares |
6 Months Ended | |
---|---|---|
Jun. 30, 2018 |
Jul. 27, 2018 |
|
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 | Jun. 30, 2018 | |
Document Fiscal Year Focus | 2018 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 29,423,454 |
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Held to maturity, fair value (in dollars) | $ 152,330 | $ 189,201 |
Preferred stock, par value (in dollars per share) | $ 0 | $ 0 |
Preferred stock, authorized shares | 1,000,000 | 1,000,000 |
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 | 29,489,954 | 30,024,222 |
Common stock, outstanding shares | 29,489,954 | 30,024,222 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 14,224 | $ 12,025 | $ 28,501 | $ 25,104 |
Other comprehensive income (loss), net of tax: | ||||
Net change in unrealized gain (loss) on investment securities | (3,669) | 2,795 | (18,640) | 4,919 |
Defined benefit plans | 150 | 190 | 406 | (174) |
Total other comprehensive income (loss), net of tax | (3,519) | 2,985 | (18,234) | 4,745 |
Comprehensive income | $ 10,705 | $ 15,010 | $ 10,267 | $ 29,849 |
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Parenthetical) - $ / shares |
6 Months Ended | |
---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Statement of Stockholders' Equity [Abstract] | ||
Cash dividends (in dollars per share) | $ 0.40 | $ 0.34 |
Common stock (purchased) sold by directors' deferred compensation plan (in net shares) | 16,950 | 10,620 |
Shares of common stock repurchased | 614,247 | 362,371 |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
6 Months Ended |
---|---|
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 1. 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, as amended by our Form 10-K/A for the fiscal year ended December 31, 2017. 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 was consolidated into our financial statements. One Hawaii HomeLoans, LLC was terminated in 2017, and final payment of taxes and distributions to members were made in March 2018. We have 50% ownership interests in three other mortgage loan origination and brokerage companies which are accounted for using the equity method and are included in investment in unconsolidated subsidiaries: Gentry HomeLoans, LLC, Haseko HomeLoans, LLC and Island Pacific HomeLoans, LLC. We also had 50% ownership interest in one additional mortgage loan origination and brokerage company, Pacific Access Mortgage, LLC, which was also accounted for using the equity method and was included in investment in unconsolidated subsidiaries. Pacific Access Mortgage, LLC was terminated in 2017, and final payment of taxes and distributions to members were made in March 2018. We also have non-controlling equity investments in affiliates that are accounted for under the cost method and are included in investment in unconsolidated subsidiaries. Our investments in unconsolidated subsidiaries accounted for under the equity and cost methods were $0.1 million and $9.2 million, respectively, at June 30, 2018 and $0.6 million and $6.5 million, respectively, at December 31, 2017. Our policy for determining impairment of these investments includes an evaluation of whether a loss in value of an investment is other than temporary. Evidence of a loss in value includes absence of an ability to recover the carrying amount of the investment or the inability of the investee to sustain an earnings capacity which would justify the carrying amount of the investment. We perform impairment tests whenever indicators of impairment are present. If the value of an investment declines and it is considered other than temporary, the investment is written down to its respective fair value in the period in which this determination is made. The Company sponsors the Central Pacific Bank Foundation, which is not consolidated in the Company's financial statements. Reclassifications The Company's equity investment securities in the prior year have been reclassified from available-for-sale debt securities to conform to the current year's presentation in accordance with Accounting Standards Update ("ASU") 2016-01, "Financial Instruments (Topic 825): Recognition and Measurement of Financial Assets and Liabilities." The reclassification had no impact on the Company's reported net income or shareholders' equity. |
RECENT ACCOUNTING PRONOUNCEMENTS |
6 Months Ended |
---|---|
Jun. 30, 2018 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
RECENT ACCOUNTING PRONOUNCEMENTS | RECENT ACCOUNTING PRONOUNCEMENTS Accounting Standards Adopted in 2018 In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers (Topic 606)." ASU 2014-09 requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. This ASU replaces most existing revenue recognition guidance in GAAP. ASU 2014-09 was initially effective for the Company's reporting period beginning on January 1, 2017. However, in August 2015, the FASB issued ASU 2015-14, "Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date" which deferred the effective date by one year. For financial reporting purposes, the standard allows for either a full retrospective or modified retrospective adoption. The FASB has also issued additional updates to provide further clarification to specific implementation issues associated with ASU 2014-09. These updates include ASU 2016-08, "Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations," ASU 2016-10, "Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing," ASU 2016-12, "Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients," and ASU 2016-20 "Technical Corrections and Improvements to Topic 606." Our revenue is comprised of net interest income on financial assets and financial liabilities, which is our main source of income, and other operating income. The scope of ASU 2014-09 explicitly excludes net interest income, as well as other revenues associated with financial assets and liabilities, including loans, leases, securities and derivatives. With respect to other operating income, the Company conducted a comprehensive scoping exercise to determine the revenue streams that are in scope of the guidance. This included reviewing the contracts potentially impacted by the standard in revenue streams such as deposit-related fees, merchant fees, bank card fees, interchange fees, commissions income, trust and asset management fees, foreign exchange fees, and loan placement fees. We adopted ASU 2014-09 and all subsequent amendments to the standard beginning January 1, 2018 under the modified retrospective approach. Based on our analysis, the standard required us to change how we recognize certain recurring revenue streams on a gross versus net basis. This resulted in an increase in other service charges and fees totaling $0.2 million and $0.3 million during the three and six months ended June 30, 2018, respectively, and the resultant increase in other operating expense-other for the same amount. These changes did not have an impact to our net income; as such a cumulative effect adjustment to opening accumulated deficit was not deemed necessary. Results for reporting periods beginning after January 1, 2018 are presented under ASC 606 while prior period amounts continue to be recorded in accordance with legacy GAAP. Refer to Note 12 - Revenue from Contracts with Customers for further discussion on the Company's accounting policies for revenue sources within the scope of Accounting Standards Codification ("ASC") 606. In January 2016, the FASB issued ASU 2016-01, "Financial Instruments (Topic 825): Recognition and Measurement of Financial Assets and Liabilities." The amendments in ASU 2016-01 made targeted improvements to GAAP as follows: 1) required equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income, 2) simplified the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment, 3) eliminated the requirement to disclose the fair value of financial instruments measured at amortized cost for entities that are not public business entities, 4) eliminated the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet, 5) required public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes, 6) required an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments, 7) required separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (that is, securities or loans and receivables) on the balance sheet or the accompanying notes to the financial statements, and 8) clarified that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets. The Company adopted ASU 2016-01 beginning January 1, 2018, which resulted in a reclassification of the Company's equity investment securities portfolio of $0.8 million and $0.8 million as of June 30, 2018 and December 31, 2017, respectively, from available-for-sale debt securities to equity securities on the Company's consolidated balance sheets. Changes in fair value are recognized in net income. In addition, during the first quarter of 2018, the Company recorded a cumulative effect adjustment which increased opening retained earnings (or reduced opening accumulated deficit) and decreased accumulated other comprehensive income (loss) ("AOCI") by $0.1 million related to the unrealized gains on the equity investment securities portfolio and changes in the fair value of the equity investment securities portfolio were recognized in net income. The Company also engaged a third-party consultant, who used a refined calculation to determine the fair value of our loans held for investment portfolio using the exit price notion, which is included in our fair value disclosures in Note 18 - Fair Value of Financial Assets and Liabilities. The refined calculation did not have a material impact on our fair value disclosures. In August 2016, the FASB issued ASU 2016-15, "Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments." ASU 2016-15 provided guidance on eight statement of cash flow classification issues and was 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. The Company adopted ASU 2016-15 effective January 1, 2018. The amendments in ASU 2016-15 did not impact the Company's financial statements as our current practice was consistent with the update. In March 2017, the FASB issued ASU 2017-07, "Compensation—Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Post-retirement Benefit Cost." ASU 2017-07 requires an entity to present the service cost component of the net periodic benefit cost in the same line item or items in the statement of income as other employee compensation costs arising from services rendered by the pertinent employees during the period. In addition, only the service cost component is eligible for capitalization. The other components of net benefit costs should be presented in the statement of income separately from the service cost component and outside a subtotal of income from operations, if one is presented. If a separate line item is used to present the other components, that line item shall be described appropriately. The line items used in the income statement to present the components other than the service cost component shall be disclosed if a Company elects to not present them in a separate line item. The Company adopted ASU 2017-07 effective January 1, 2018. The amendments in ASU 2017-07 did not impact the Company's financial statements. In March 2017, the FASB issued ASU 2017-08, "Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities." ASU 2017-08 shortens the amortization period for certain callable debt securities held at a premium to the earliest call date. ASU 2017-08 does not require an accounting change for securities held at a discount; the discount continues to be amortized to maturity. The Company adopted ASU 2017-08 effective January 1, 2018. The amendments in ASU 2017-08 did not have a material impact to the Company's financial statements. In May 2017, the FASB issued ASU 2017-09, "Compensation-Stock Compensation (Topic 718): Scope of Modification." ASU 2017-09 was issued to provide clarity and reduce both (1) diversity in practice and (2) cost and complexity when applying the guidance in Topic 718, Compensation - Stock Compensation, to a change to the terms or conditions of a share-based payment award. Diversity in practice has arisen in part because some entities apply modification accounting under Topic 718 for modifications to terms and conditions that they consider substantive, but do not when they conclude that particular modifications are not substantive. Others apply modification accounting for any change to an award, except for changes that they consider purely administrative in nature. Still others apply modification accounting when a change to an award changes the fair value, the vesting, or the classification of the award. In practice, it appears that the evaluation of a change in fair value, vesting, or classification may be used to evaluate whether a change is substantive. ASU 2017-09 includes guidance on determining which changes to the terms and conditions of share-based payment awards require an entity to apply modification accounting under Topic 718. The Company adopted ASU 2017-09 effective January 1, 2018. The amendments in ASU 2017-09 did not impact the Company's financial statements as the Company has not historically had any scope modifications and has no plans to do so in the near future. In February 2018, the FASB issued ASU 2018-02, "Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income." ASU 2018-02 was issued to address certain stranded tax effects in AOCI as a result of H.R.1., commonly referred to as the Tax Cuts and Jobs Act ("Tax Reform"). ASU 2018-02 provides companies the option to reclassify stranded tax effects within AOCI to retained earnings (or accumulated deficit) in each period in which the effect of the change from the newly enacted corporate tax rate is recorded. The amount of the reclassification is calculated on the basis of the difference between the historical and newly enacted tax rates for deferred tax assets and liabilities related to items within AOCI. ASU 2018-02 requires companies to disclose its accounting policy related to releasing income tax effects from accumulated other comprehensive income, whether it has elected to reclassify the stranded tax effects, and information about the other income tax effects that are reclassified. Although ASU 2018-02 is effective for the Company's reporting period beginning on January 1, 2019, the Company elected to early adopt the standard effective January 1, 2018. As a result, the Company recorded cumulative effect adjustments which increased opening retained earnings (or reduced opening accumulated deficit) and decreased AOCI for the stranded tax effects related to the Company's defined benefit pension and supplemental retirement plan obligations and the unrealized loss on the Company's investment securities portfolio by $1.4 million and $0.5 million, respectively. Impact of Other Recently Issued Accounting Pronouncements on Future Filings In February 2016, the FASB issued ASU 2016-02, "Leases (Topic 842)." ASU 2016-02 increases transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The ASU establishes a right-of-use ("ROU") model that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term of longer than 12 months. The ASU is effective for the Company's reporting period beginning January 1, 2019 and must be applied using the modified retrospective approach. Based on preliminary evaluation, the ASU will not have a material impact on our consolidated financial statements as the projected minimum lease payments under existing leases subject to the ASU are less than one percent of our total assets as of June 30, 2018. In June 2016, the FASB issued ASU 2016-13, "Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments," which significantly changes how entities will measure credit losses for most financial assets and certain other instruments that aren’t measured at fair value through net income. In issuing the standard, the FASB is responding to criticism that today’s “incurred loss” guidance delays the recognition of credit losses on loans, leases, held-to-maturity debt securities, loan commitments, and financial guarantees, providing for a current expected credit loss (“CECL”) approach to determine the allowance for credit losses. CECL requires an organization to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. In addition, this guidance modifies the accounting treatment for other-than-temporary impairment for available-for-sale debt securities. Organizations will continue to use judgment to determine which loss estimation methods are appropriate for their circumstances. This guidance requires entities to record a cumulative effect adjustment to the consolidated balance sheet as of the beginning of the first reporting period in which the guidance is effective. This update is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019, with earlier adoption permitted. As such, the Company will implement CECL for the reporting period beginning January 1, 2020. The new guidance will require significant operational changes, particularly in data collection and analysis. The Company has formed a steering committee that is responsible for oversight of the Company’s implementation strategy for compliance with provisions of the new standard. The Company has also established a project management governance process to manage the implementation across affected disciplines. An external provider specializing in community bank loss driver and CECL reserving model design as well as other related consulting services has been retained, and we have begun to evaluate potential CECL modeling alternatives. The Company presently plans to generate and evaluate model scenarios under CECL in tandem with its current reserving processes for interim and annual reporting periods in 2019. While the Company is currently unable to reasonably estimate the impact of adopting this new guidance, management expects the impact of adoption will be significantly influenced by the composition and quality of the Company’s loans and investment securities as well as the economic conditions as of the date of adoption. The Company also anticipates significant changes to the processes and procedures for calculating the reserve for credit losses and continues to evaluate the potential impact on our consolidated financial statements. |
INVESTMENT SECURITIES |
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INVESTMENT SECURITIES | 3. INVESTMENT SECURITIES A summary of our investment portfolio is as follows:
The amortized cost and estimated fair value of investment securities at June 30, 2018 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 three and six months ended June 30, 2018. In the second quarter of 2017, we completed an investment portfolio repositioning strategy designed to enhance potential prospective earnings and improve net interest margin. In connection with the repositioning, we sold $97.7 million in lower-yielding available-for-sale securities, and purchased $97.4 million in higher yielding, longer duration investment securities. The investment securities sold had a duration of 3.3 years and an average yield of 1.91%. Gross proceeds of the sale of $96.0 million were immediately reinvested back into investment securities with a duration of 4.6 years and an average yield of 2.57%. The new securities were classified in the available-for-sale portfolio. There were no gross realized gains on the sale of the investment securities. Gross realized losses on the sale of the investment securities were $1.6 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 three months ended March 31, 2017. Investment securities of $1.03 billion and $1.08 billion at June 30, 2018 and December 31, 2017, 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 345 and 223 investment securities which were in an unrealized or unrecognized loss position at June 30, 2018 and December 31, 2017, respectively, aggregated by major security type and length of time in a continuous unrealized or unrecognized loss position.
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 | 4. LOANS AND LEASES Loans and leases, excluding loans held for sale, consisted of the following:
During the six months ended June 30, 2018, we foreclosed on one loan totaling $40 thousand, which was sold at a small premium to book value. During the six months ended June 30, 2017, we foreclosed on one loan totaling $0.1 million. During the six months ended June 30, 2018 and 2017, we did not transfer any loans to the held-for-sale category. We did not sell any portfolio loans during the six months ended June 30, 2018 and 2017. In May 2018, we purchased an auto loan portfolio totaling $20.6 million which included a $0.1 million premium over the $20.5 million outstanding balance. At the time of purchase, the auto loans had a weighted average remaining term of 63 months and a weighted average yield, net of the premium paid and servicing costs, of 3.89%. In November 2017, we purchased an auto loan portfolio totaling $33.1 million which included a $1.1 million premium over the $31.9 million outstanding balance. At the time of purchase, the auto loans had a weighted average remaining term of 76 months and a weighted average yield, net of the premium paid and servicing costs, of 3.04%. In May 2017, we purchased an auto loan portfolio totaling $26.6 million which included a $0.9 million premium over the $25.7 million outstanding balance. At the time of purchase, the auto loans had a weighted average remaining term of 77 months and a weighted average yield, net of the premium paid and servicing costs, of 2.67%. In March 2017, we purchased an auto loan portfolio totaling $24.1 million which included a $0.4 million premium over the $23.8 million outstanding balance. At the time of purchase, the auto loans had a weighted average remaining term of 55 months and a weighted average yield, net of the premium paid and servicing costs, of 2.60%. 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 June 30, 2018 and December 31, 2017:
There were no impaired loans with an allowance recorded as of June 30, 2018 and December 31, 2017. The following table presents by class, information related to impaired loans as of June 30, 2018 and December 31, 2017:
The following table presents by class, the average recorded investment and interest income recognized on impaired loans for the three and six months ended June 30, 2018 and 2017:
Foreclosure Proceedings The Company did not have any residential mortgage loans collateralized by residential real estate property that were in the process of foreclosure at June 30, 2018. The Company had $40 thousand of residential mortgage loans collateralized by residential real estate property that were in the process of foreclosure at December 31, 2017. 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 June 30, 2018 and December 31, 2017:
Modifications Troubled debt restructurings ("TDRs") included in nonperforming assets at June 30, 2018 consisted of four Hawaii residential mortgage loans with a combined principal balance of $0.5 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 $11.3 million of TDRs still accruing interest at June 30, 2018, none of which were more than 90 days delinquent. At December 31, 2017, there were $12.6 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 six months ended June 30, 2018. The following table presents by class, information related to loans modified in a TDR during the period presented. There were no loans modified in a TDR during the three and six months ended June 30, 2018 or the three months ended June 30, 2017.
No loans were modified as a TDR within the previous twelve months that subsequently defaulted during the three and six months ended June 30, 2018 and 2017. 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 by 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 June 30, 2018 and December 31, 2017:
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ALLOWANCE FOR LOAN AND LEASE LOSSES |
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ALLOWANCE FOR LOAN AND LEASE LOSSES | 5. 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 debit of $0.5 million and $0.3 million in the three and six months ended June 30, 2018, respectively, compared to a credit of $2.3 million and $2.4 million in the three and six months ended June 30, 2017, respectively. |
SECURITIZATIONS |
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Jun. 30, 2018 | |
Transfers and Servicing [Abstract] | |
SECURITIZATIONS | 6. 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 $1.2 million and $1.5 million at June 30, 2018 and December 31, 2017, respectively. The fair values of these mortgage-backed securities were based on quoted prices of similar instruments in active markets. Unrealized gains of $41 thousand and $0.1 million on unsold mortgage-backed securities were recorded in AOCI at June 30, 2018 and December 31, 2017, 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 | 7. INVESTMENTS IN UNCONSOLIDATED SUBSIDIARIES The components of the Company's investments in unconsolidated subsidiaries were as follows:
The Company had $5.6 million in unfunded low income housing commitments as of June 30, 2018 compared to $2.6 million at December 31, 2017. The Company expects to fund $1.9 million in 2018 and $3.7 million in 2019. 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 six months ended June 30, 2018 and June 30, 2017:
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CORE DEPOSIT PREMIUM AND MORTGAGE SERVICING RIGHTS |
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CORE DEPOSIT PREMIUM AND MORTGAGE SERVICING RIGHTS | 8. CORE DEPOSIT PREMIUM AND MORTGAGE SERVICING RIGHTS The following table presents changes in core deposit premium and mortgage servicing rights for the six months ended June 30, 2018:
Income generated as the result of new mortgage servicing rights is reported as gains on sales of loans and totaled $0.4 million and $0.8 million for the three and six months ended June 30, 2018, respectively, compared to $0.6 million and $1.2 million for the three and six months ended June 30, 2017, respectively. Amortization of mortgage servicing rights was $0.4 million and $0.9 million, respectively, for the three and six months ended June 30, 2018, compared to $0.5 million and $1.1 million for the three and six months ended June 30, 2017, respectively. 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 core deposit premium and mortgage servicing rights are presented below:
Based on the core deposit premium and mortgage servicing rights held as of June 30, 2018, estimated amortization expense for the remainder of fiscal year 2018, the next five succeeding fiscal years and all years thereafter are as follows:
We perform an impairment assessment of our core deposit premium and mortgage servicing rights whenever events or changes in circumstance indicate that the carrying value of those assets may not be recoverable. |
DERIVATIVES |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DERIVATIVES | 9. 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 June 30, 2018, we were not party to any derivatives designated as part of a fair value or cash flow hedge. 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 June 30, 2018, we were a party to interest rate lock and forward sale commitments on $3.7 million and $12.7 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 |
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Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
SHORT-TERM BORROWINGS AND LONG-TERM DEBT | 10. SHORT-TERM BORROWINGS AND LONG-TERM DEBT Federal Home Loan Bank Advances and Other Borrowings The bank is a member of the Federal Home Loan Bank of Des Moines (the "FHLB") and maintained a $1.62 billion line of credit as of June 30, 2018, compared to $1.50 billion at December 31, 2017. At June 30, 2018, $1.53 billion was undrawn under this arrangement, compared to $1.47 billion at December 31, 2017. Short-term borrowings under this arrangement totaled $87.0 million at June 30, 2018, compared to $32.0 million at December 31, 2017. There were no long-term borrowings under this arrangement at June 30, 2018 and December 31, 2017. FHLB advances available at June 30, 2018 were secured by certain real estate loans with a carrying value of $2.18 billion in accordance with the collateral provisions of the Advances, Security and Deposit Agreement with the FHLB. At June 30, 2018 and December 31, 2017, our bank had additional unused borrowings available at the Federal Reserve discount window of $71.5 million and $73.0 million, respectively. As of June 30, 2018 and December 31, 2017, certain commercial and commercial real estate loans with a carrying value totaling $125.8 million and $129.2 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. Subordinated Debentures In October 2003, we created two wholly-owned statutory trusts, CPB Capital Trust II ("Trust II") and CPB Statutory Trust III ("Trust III"). Trust II issued $20.0 million in trust preferred securities bearing an interest rate of three-month LIBOR plus 2.85% and maturing on October 7, 2033. The principal assets of Trust II are $20.6 million of the Company's subordinated debentures with an identical interest rate and maturity as the Trust II trust preferred securities. Trust II issued $0.6 million of common securities to the Company. Trust III issued $20.0 million in trust preferred securities bearing an interest rate of three-month LIBOR plus 2.85% and maturing on December 17, 2033. The principal assets of Trust III are $20.6 million of the Company's subordinated debentures with an identical interest rate and maturity as the Trust III trust preferred securities. Trust III issued $0.6 million of common securities to the Company. In September 2004, we created a wholly-owned statutory trust, CPB Capital Trust IV ("Trust IV"). Trust IV issued $30.0 million in trust preferred securities bearing an interest rate of three-month LIBOR plus 2.45% and maturing on December 15, 2034. The principal assets of Trust IV are $30.9 million of the Company's subordinated debentures with an identical interest rate and maturity as the Trust IV trust preferred securities. Trust IV issued $0.9 million of common securities to the Company. In December 2004, we created a wholly-owned statutory trust, CPB Statutory Trust V ("Trust V"). Trust V issued $20.0 million in trust preferred securities bearing an interest rate of three-month LIBOR plus 1.87% and maturing on December 15, 2034. The principal assets of Trust V are $20.6 million of the Company's subordinated debentures with an identical interest rate and maturity as the Trust V trust preferred securities. Trust V issued $0.6 million of common securities to the Company. The trust preferred securities, the subordinated debentures that are the assets of Trusts II, III, IV and V and the common securities issued by Trusts II, III, IV and V are redeemable in whole or in part on any interest payment date on or after October 7, 2008 for Trusts II and III, and on or after December 15, 2009 for Trust IV and V, or at any time in whole but not in part within 90 days following the occurrence of certain events. Our obligations with respect to the issuance of the trust preferred securities constitute a full and unconditional guarantee by the Company of each trust's obligations with respect to its trust preferred securities. Subject to certain exceptions and limitations, we may elect from time to time to defer interest payments on the subordinated debentures, which would result in a deferral of distribution payments on the related trust preferred securities, for up to 20 consecutive quarterly periods without default or penalty. |
REVENUE FROM CONTRACTS WITH CUSTOMERS |
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
REVENUE FROM CONTRACTS WITH CUSTOMERS | 12. REVENUE FROM CONTRACTS WITH CUSTOMERS Revenue Recognition Accounting Standards Codification ("ASC") 606, "Revenue from Contracts with Customers", establishes principles for reporting information about the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity's contracts to provide goods or services to its customers. The core principle requires an entity to recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration that it expects to be entitled to receive in exchange for those goods or services. Revenue is recognized as performance obligations are satisfied. The Company recognizes revenues as they are earned based on contractual terms, as transactions occur, or as services are provided and collectability is reasonably assured. Our principal source of revenue is derived from interest income on financial instruments, such as our loan and investment securities portfolios, as well as revenue related to our mortgage banking activities. These revenue-generating transactions are out of scope of ASC 606, but are subject to other GAAP and discussed elsewhere within our disclosures. We also generate other revenue in connection with our broad range of banking products and financial services. Descriptions of our other revenue-generating activities that are within the scope of ASC 606, which are presented in our consolidated statements of income as components of other operating income are as follows: Service charges on deposit accounts Revenue from service charges on deposit accounts includes general service fees for monthly account maintenance and activity- or transaction-based fees and consist of transaction-based revenue, time-based revenue (service period), item-based revenue or some other individual attribute-based revenue. Revenue is recognized when our performance obligation is completed which is generally monthly for account maintenance services or when a transaction has been completed (such as stop payment fees). Payment for such performance obligations are generally received at the time the performance obligations are satisfied. Other Service Charges and Fees Revenue from other service charges and fees includes cards and payments income, safe deposit rental income and other service charges, commissions and fees. Cards and payments income includes interchange fees from debit cards processed through card association networks, merchant services, and other card related services. Interchange rates are generally set by the credit card associations and based on purchase volumes and other factors. Interchange fees are recognized as transactions occur. Interchange expenses related to cards and payments income are presented gross in other operating expense. Merchant services income represents account management fees and transaction fees charged to merchants for the processing of card association network transactions. Merchant services revenue is recognized as transactions occur, or as services are performed. Other service charges, commissions and fees include automated teller machines ("ATM") surcharge and interchange fees, bill payment fees, cashier’s check and money order fees, wire transfer fees, loan brokerage fees, and commissions on sales of insurance, broker-dealer products, letters of credit, and travelers’ checks. Revenue from these fees and commissions is recorded in a manner that reflects the timing of when transactions occur, and as services are provided. Based on the nature of the commission agreement with the broker-dealer and each insurance provider, we may recognize revenue from broker-dealer and insurance commissions over time or at a point-in-time as our performance obligation is satisfied. Income from Fiduciary Activities Income from fiduciary activities includes fees from wealth management, trust, custodial and escrow services provided to individual and institutional customers. Revenue is generally recognized monthly based on a minimum annual fee and/or the market value of assets in custody. Additional fees are recognized for transactional activity. Revenue from trade execution and brokerage services is earned through commissions from trade execution on behalf of clients. Revenue from these transactions is recognized at the trade date. Any ongoing service fees are recognized on a monthly basis as services are performed. Fees on Foreign Exchange The Company provides foreign currency exchange services to customers, whereby cash can be converted to different foreign currencies, and vice versa. As a result of the services, a gain or loss is recognized on foreign currency transactions, as well as income related to commissions and fees earned on each transaction. Revenue from the commissions and fees earned on the transactions fall within the scope of ASC 606, and is recorded in a manner that reflects the timing of when transactions occur, and as services are provided. Realized and unrealized gains or losses related to foreign currency are out of scope of ASC 606. Loan Placement Fees Loan placement fees primarily represent revenues earned by the Company for loan placement and underwriting. Revenues for these services are recorded at a point-in-time, upon completion of a contractually identified transaction, or when an advisory opinion is provided. Gain on Sales of Foreclosed Assets The Company records a gain or loss on the sale of a foreclosed property when control of the property transfers to the Company, which typically occurs at the time the deed is executed. The Company does not finance the sale of the foreclosed property. The following presents the Company's other operating income, segregated by revenue streams that are in-scope and out-of-scope of ASC 606 for the six months ended June 30, 2018 and 2017.
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EQUITY |
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Jun. 30, 2018 | |
Equity [Abstract] | |
EQUITY | 11. EQUITY 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 June 30, 2018, the bank had Statutory Retained Earnings of $86.3 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"), which superseded in its entirety the repurchase plan that was previously approved by the Board of Directors. In January 2017, 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 "2017 Repurchase Plan"). The 2017 Repurchase Plan replaced and superseded in its entirety the 2016 Repurchase Plan. In January 2017, prior to the 2017 Repurchase Plan being approved, 1,750 shares of common stock, at a cost of $0.1 million, were repurchased under the 2016 Repurchase Plan. In November 2017, the Board of Directors authorized an increase in the share repurchase program authority by an additional $50.0 million (known henceforth as the "Repurchase Plan"). This amount is in addition to the $30.0 million in planned repurchases authorized in January 2017. There is no expiration date on the Repurchase Plan. In the year ended December 31, 2017, 864,483 shares of common stock, at a cost of $26.6 million, were repurchased under the 2016 Repurchase Plan and the Repurchase Plan combined. In the six months ended June 30, 2018, a total of 614,247 shares of common stock, at a cost of $18.1 million, were repurchased under the Repurchase Plan. A total of $35.4 million remained available for repurchase under the Repurchase Plan as of June 30, 2018. |
MORTGAGE BANKING INCOME |
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MORTGAGE BANKING INCOME | 13. MORTGAGE BANKING INCOME Noninterest income from the Company's mortgage banking activities include the following components for the periods indicated:
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SHARE-BASED COMPENSATION |
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SHARE-BASED COMPENSATION | 14. SHARE-BASED COMPENSATION Restricted Stock Awards and Units The table below presents the activity of restricted stock awards and units for the six months ended June 30, 2018:
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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) |
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Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | 16. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The following tables present the components of other comprehensive income for the three and six months ended June 30, 2018 and 2017, by component:
The following tables present the changes in each component of AOCI, net of tax, for the three and six months ended June 30, 2018 and 2017:
The following table presents the amounts reclassified out of each component of AOCI for the three and six months ended June 30, 2018 and 2017:
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PENSION AND SUPPLEMENTAL EXECUTIVE RETIREMENT PLANS |
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Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PENSION AND SUPPLEMENTAL EXECUTIVE RETIREMENT PLANS | 15. 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 for the periods indicated:
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. In the second quarter of 2017, the Company settled a portion of the SERP obligation of a former executive. As a result of the settlement, the Company remeasured the related SERP obligation and net periodic benefit cost and recognized a pro-rata net actuarial loss of $0.1 million in SERP expense and other comprehensive income. The following table sets forth the components of net periodic benefit cost for the SERPs for the periods indicated:
All components of net periodic benefit cost are included in salaries and employee benefits in the Company's consolidated statements of income. |
EARNINGS PER SHARE |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
EARNINGS PER SHARE | 17. 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 |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES | 18. 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. In accordance with ASU 2016-01, the fair value of loans as of June 30, 2018 are based on the notion of exit price. The fair value of loans as of December 31, 2017 was measured using an entry price notion. 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, if any, net of applicable selling costs on our consolidated balance sheets. Mortgage Servicing Rights The initial fair value of the servicing right is calculated by a discounted cash flow model prepared by a third-party service provider based on market value assumptions at the time of origination. We assess the servicing right for impairment using current market value assumptions at each reporting period. Critical assumptions used in the discounted cash flow model include mortgage prepayment speeds, discount rates, costs to service, and ancillary income. Variations in our assumptions could materially affect the estimated fair values. Changes to our assumptions are made when current trends and market data indicate that new trends have developed. Current market value assumptions based on loan product types (fixed rate, adjustable rate and balloon loans) include average discount rates and prepayment speeds. Many of these assumptions are subjective and require a high level of management judgment. Our mortgage servicing rights portfolio and valuation assumptions are periodically reviewed by management. Federal Home Loan Bank Stock It is not practical to determine the fair value of FHLB stock due to the restrictions placed on its transferability. 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.
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 and equity 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, mortgage servicing rights, and other real estate owned. These nonrecurring fair value adjustments typically involve application of the lower of cost or fair value accounting or write-downs of individual assets. The Company's policy is to recognize transfers into or out of a level as of the end of the reporting period. There were no transfers of financial assets and liabilities between Level 1 and Level 2 of the fair value hierarchy during the three and six months ended June 30, 2018. Also, there were no transfers of financial assets and liabilities into or out of Level 3 of the fair value hierarchy during the three and six months ended June 30, 2018. The following tables present the fair value of assets and liabilities measured on a recurring basis as of June 30, 2018 and December 31, 2017:
For the six months ended June 30, 2018 and 2017, the changes in Level 3 assets and liabilities measured at fair value on a recurring basis are summarized as follows:
Within the states and political subdivisions available-for-sale debt securities category, the Company holds four mortgage revenue bonds issued by the City & County of Honolulu with an aggregate fair value of $11.3 million and $12.2 million at June 30, 2018 and June 30, 2017, 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 June 30, 2018, the weighted average discount rate utilized was 5.16%, compared to 4.54% at June 30, 2017 and 4.81% at December 31, 2017, 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. The following table presents the fair value of assets measured on a nonrecurring basis and the level of valuation assumptions used to determine the respective fair values as of June 30, 2018 and December 31, 2017:
The significant unobservable inputs used in the fair value measurement of the Company's mortgage servicing rights are the weighted average discount rate and the forecasted constant prepayment rate. As of June 30, 2018, the weighted average discount rate and the forecasted constant prepayment rate utilized were 9.5% and 13.9%, respectively, compared to 9.5% and 16.1%, respectively, as of June 30, 2017 and 9.5% and 16.0%, respectively, as of December 31, 2017. Significant increases (decreases) in the weighted average discount rate and/or the forecasted constant prepayment rate could result in a significantly lower (higher) fair value measurement. |
SEGMENT INFORMATION |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEGMENT INFORMATION | 19. 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, 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 - Summary of Significant Accounting Policies to the consolidated financial statements in the Annual Report on Form 10-K, as amended by our Form 10-K/A for the year ended December 31, 2017 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 |
6 Months Ended |
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Jun. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
LEGAL PROCEEDINGS | 20. 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. |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) |
6 Months Ended |
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Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Accounting, Policy [Policy Text Block] | 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, as amended by our Form 10-K/A for the fiscal year ended December 31, 2017. 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. |
Consolidation, Policy [Policy Text Block] | 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 was consolidated into our financial statements. One Hawaii HomeLoans, LLC was terminated in 2017, and final payment of taxes and distributions to members were made in March 2018. We have 50% ownership interests in three other mortgage loan origination and brokerage companies which are accounted for using the equity method and are included in investment in unconsolidated subsidiaries: Gentry HomeLoans, LLC, Haseko HomeLoans, LLC and Island Pacific HomeLoans, LLC. We also had 50% ownership interest in one additional mortgage loan origination and brokerage company, Pacific Access Mortgage, LLC, which was also accounted for using the equity method and was included in investment in unconsolidated subsidiaries. Pacific Access Mortgage, LLC was terminated in 2017, and final payment of taxes and distributions to members were made in March 2018. We also have non-controlling equity investments in affiliates that are accounted for under the cost method and are included in investment in unconsolidated subsidiaries. Our investments in unconsolidated subsidiaries accounted for under the equity and cost methods were $0.1 million and $9.2 million, respectively, at June 30, 2018 and $0.6 million and $6.5 million, respectively, at December 31, 2017. Our policy for determining impairment of these investments includes an evaluation of whether a loss in value of an investment is other than temporary. Evidence of a loss in value includes absence of an ability to recover the carrying amount of the investment or the inability of the investee to sustain an earnings capacity which would justify the carrying amount of the investment. We perform impairment tests whenever indicators of impairment are present. If the value of an investment declines and it is considered other than temporary, the investment is written down to its respective fair value in the period in which this determination is made. The Company sponsors the Central Pacific Bank Foundation, which is not consolidated in the Company's financial statements. |
Reclassification, Policy [Policy Text Block] | Reclassifications The Company's equity investment securities in the prior year have been reclassified from available-for-sale debt securities to conform to the current year's presentation in accordance with Accounting Standards Update ("ASU") 2016-01, "Financial Instruments (Topic 825): Recognition and Measurement of Financial Assets and Liabilities." The reclassification had no impact on the Company's reported net income or shareholders' equity. |
RECENT ACCOUNTING PRONOUNCEMENTS (Policies) |
6 Months Ended |
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Jun. 30, 2018 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Recent Accounting Pronouncements | RECENT ACCOUNTING PRONOUNCEMENTS Accounting Standards Adopted in 2018 In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers (Topic 606)." ASU 2014-09 requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. This ASU replaces most existing revenue recognition guidance in GAAP. ASU 2014-09 was initially effective for the Company's reporting period beginning on January 1, 2017. However, in August 2015, the FASB issued ASU 2015-14, "Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date" which deferred the effective date by one year. For financial reporting purposes, the standard allows for either a full retrospective or modified retrospective adoption. The FASB has also issued additional updates to provide further clarification to specific implementation issues associated with ASU 2014-09. These updates include ASU 2016-08, "Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations," ASU 2016-10, "Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing," ASU 2016-12, "Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients," and ASU 2016-20 "Technical Corrections and Improvements to Topic 606." Our revenue is comprised of net interest income on financial assets and financial liabilities, which is our main source of income, and other operating income. The scope of ASU 2014-09 explicitly excludes net interest income, as well as other revenues associated with financial assets and liabilities, including loans, leases, securities and derivatives. With respect to other operating income, the Company conducted a comprehensive scoping exercise to determine the revenue streams that are in scope of the guidance. This included reviewing the contracts potentially impacted by the standard in revenue streams such as deposit-related fees, merchant fees, bank card fees, interchange fees, commissions income, trust and asset management fees, foreign exchange fees, and loan placement fees. We adopted ASU 2014-09 and all subsequent amendments to the standard beginning January 1, 2018 under the modified retrospective approach. Based on our analysis, the standard required us to change how we recognize certain recurring revenue streams on a gross versus net basis. This resulted in an increase in other service charges and fees totaling $0.2 million and $0.3 million during the three and six months ended June 30, 2018, respectively, and the resultant increase in other operating expense-other for the same amount. These changes did not have an impact to our net income; as such a cumulative effect adjustment to opening accumulated deficit was not deemed necessary. Results for reporting periods beginning after January 1, 2018 are presented under ASC 606 while prior period amounts continue to be recorded in accordance with legacy GAAP. Refer to Note 12 - Revenue from Contracts with Customers for further discussion on the Company's accounting policies for revenue sources within the scope of Accounting Standards Codification ("ASC") 606. In January 2016, the FASB issued ASU 2016-01, "Financial Instruments (Topic 825): Recognition and Measurement of Financial Assets and Liabilities." The amendments in ASU 2016-01 made targeted improvements to GAAP as follows: 1) required equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income, 2) simplified the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment, 3) eliminated the requirement to disclose the fair value of financial instruments measured at amortized cost for entities that are not public business entities, 4) eliminated the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet, 5) required public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes, 6) required an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments, 7) required separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (that is, securities or loans and receivables) on the balance sheet or the accompanying notes to the financial statements, and 8) clarified that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets. The Company adopted ASU 2016-01 beginning January 1, 2018, which resulted in a reclassification of the Company's equity investment securities portfolio of $0.8 million and $0.8 million as of June 30, 2018 and December 31, 2017, respectively, from available-for-sale debt securities to equity securities on the Company's consolidated balance sheets. Changes in fair value are recognized in net income. In addition, during the first quarter of 2018, the Company recorded a cumulative effect adjustment which increased opening retained earnings (or reduced opening accumulated deficit) and decreased accumulated other comprehensive income (loss) ("AOCI") by $0.1 million related to the unrealized gains on the equity investment securities portfolio and changes in the fair value of the equity investment securities portfolio were recognized in net income. The Company also engaged a third-party consultant, who used a refined calculation to determine the fair value of our loans held for investment portfolio using the exit price notion, which is included in our fair value disclosures in Note 18 - Fair Value of Financial Assets and Liabilities. The refined calculation did not have a material impact on our fair value disclosures. In August 2016, the FASB issued ASU 2016-15, "Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments." ASU 2016-15 provided guidance on eight statement of cash flow classification issues and was 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. The Company adopted ASU 2016-15 effective January 1, 2018. The amendments in ASU 2016-15 did not impact the Company's financial statements as our current practice was consistent with the update. In March 2017, the FASB issued ASU 2017-07, "Compensation—Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Post-retirement Benefit Cost." ASU 2017-07 requires an entity to present the service cost component of the net periodic benefit cost in the same line item or items in the statement of income as other employee compensation costs arising from services rendered by the pertinent employees during the period. In addition, only the service cost component is eligible for capitalization. The other components of net benefit costs should be presented in the statement of income separately from the service cost component and outside a subtotal of income from operations, if one is presented. If a separate line item is used to present the other components, that line item shall be described appropriately. The line items used in the income statement to present the components other than the service cost component shall be disclosed if a Company elects to not present them in a separate line item. The Company adopted ASU 2017-07 effective January 1, 2018. The amendments in ASU 2017-07 did not impact the Company's financial statements. In March 2017, the FASB issued ASU 2017-08, "Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities." ASU 2017-08 shortens the amortization period for certain callable debt securities held at a premium to the earliest call date. ASU 2017-08 does not require an accounting change for securities held at a discount; the discount continues to be amortized to maturity. The Company adopted ASU 2017-08 effective January 1, 2018. The amendments in ASU 2017-08 did not have a material impact to the Company's financial statements. In May 2017, the FASB issued ASU 2017-09, "Compensation-Stock Compensation (Topic 718): Scope of Modification." ASU 2017-09 was issued to provide clarity and reduce both (1) diversity in practice and (2) cost and complexity when applying the guidance in Topic 718, Compensation - Stock Compensation, to a change to the terms or conditions of a share-based payment award. Diversity in practice has arisen in part because some entities apply modification accounting under Topic 718 for modifications to terms and conditions that they consider substantive, but do not when they conclude that particular modifications are not substantive. Others apply modification accounting for any change to an award, except for changes that they consider purely administrative in nature. Still others apply modification accounting when a change to an award changes the fair value, the vesting, or the classification of the award. In practice, it appears that the evaluation of a change in fair value, vesting, or classification may be used to evaluate whether a change is substantive. ASU 2017-09 includes guidance on determining which changes to the terms and conditions of share-based payment awards require an entity to apply modification accounting under Topic 718. The Company adopted ASU 2017-09 effective January 1, 2018. The amendments in ASU 2017-09 did not impact the Company's financial statements as the Company has not historically had any scope modifications and has no plans to do so in the near future. In February 2018, the FASB issued ASU 2018-02, "Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income." ASU 2018-02 was issued to address certain stranded tax effects in AOCI as a result of H.R.1., commonly referred to as the Tax Cuts and Jobs Act ("Tax Reform"). ASU 2018-02 provides companies the option to reclassify stranded tax effects within AOCI to retained earnings (or accumulated deficit) in each period in which the effect of the change from the newly enacted corporate tax rate is recorded. The amount of the reclassification is calculated on the basis of the difference between the historical and newly enacted tax rates for deferred tax assets and liabilities related to items within AOCI. ASU 2018-02 requires companies to disclose its accounting policy related to releasing income tax effects from accumulated other comprehensive income, whether it has elected to reclassify the stranded tax effects, and information about the other income tax effects that are reclassified. Although ASU 2018-02 is effective for the Company's reporting period beginning on January 1, 2019, the Company elected to early adopt the standard effective January 1, 2018. As a result, the Company recorded cumulative effect adjustments which increased opening retained earnings (or reduced opening accumulated deficit) and decreased AOCI for the stranded tax effects related to the Company's defined benefit pension and supplemental retirement plan obligations and the unrealized loss on the Company's investment securities portfolio by $1.4 million and $0.5 million, respectively. Impact of Other Recently Issued Accounting Pronouncements on Future Filings In February 2016, the FASB issued ASU 2016-02, "Leases (Topic 842)." ASU 2016-02 increases transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The ASU establishes a right-of-use ("ROU") model that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term of longer than 12 months. The ASU is effective for the Company's reporting period beginning January 1, 2019 and must be applied using the modified retrospective approach. Based on preliminary evaluation, the ASU will not have a material impact on our consolidated financial statements as the projected minimum lease payments under existing leases subject to the ASU are less than one percent of our total assets as of June 30, 2018. In June 2016, the FASB issued ASU 2016-13, "Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments," which significantly changes how entities will measure credit losses for most financial assets and certain other instruments that aren’t measured at fair value through net income. In issuing the standard, the FASB is responding to criticism that today’s “incurred loss” guidance delays the recognition of credit losses on loans, leases, held-to-maturity debt securities, loan commitments, and financial guarantees, providing for a current expected credit loss (“CECL”) approach to determine the allowance for credit losses. CECL requires an organization to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. In addition, this guidance modifies the accounting treatment for other-than-temporary impairment for available-for-sale debt securities. Organizations will continue to use judgment to determine which loss estimation methods are appropriate for their circumstances. This guidance requires entities to record a cumulative effect adjustment to the consolidated balance sheet as of the beginning of the first reporting period in which the guidance is effective. This update is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019, with earlier adoption permitted. As such, the Company will implement CECL for the reporting period beginning January 1, 2020. The new guidance will require significant operational changes, particularly in data collection and analysis. The Company has formed a steering committee that is responsible for oversight of the Company’s implementation strategy for compliance with provisions of the new standard. The Company has also established a project management governance process to manage the implementation across affected disciplines. An external provider specializing in community bank loss driver and CECL reserving model design as well as other related consulting services has been retained, and we have begun to evaluate potential CECL modeling alternatives. The Company presently plans to generate and evaluate model scenarios under CECL in tandem with its current reserving processes for interim and annual reporting periods in 2019. While the Company is currently unable to reasonably estimate the impact of adopting this new guidance, management expects the impact of adoption will be significantly influenced by the composition and quality of the Company’s loans and investment securities as well as the economic conditions as of the date of adoption. The Company also anticipates significant changes to the processes and procedures for calculating the reserve for credit losses and continues to evaluate the potential impact on our consolidated financial statements. |
REVENUE FROM CONTRACTS WITH CUSTOMERS (Policies) |
6 Months Ended |
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Jun. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition Accounting Standards Codification ("ASC") 606, "Revenue from Contracts with Customers", establishes principles for reporting information about the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity's contracts to provide goods or services to its customers. The core principle requires an entity to recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration that it expects to be entitled to receive in exchange for those goods or services. Revenue is recognized as performance obligations are satisfied. The Company recognizes revenues as they are earned based on contractual terms, as transactions occur, or as services are provided and collectability is reasonably assured. Our principal source of revenue is derived from interest income on financial instruments, such as our loan and investment securities portfolios, as well as revenue related to our mortgage banking activities. These revenue-generating transactions are out of scope of ASC 606, but are subject to other GAAP and discussed elsewhere within our disclosures. We also generate other revenue in connection with our broad range of banking products and financial services. Descriptions of our other revenue-generating activities that are within the scope of ASC 606, which are presented in our consolidated statements of income as components of other operating income are as follows: Service charges on deposit accounts Revenue from service charges on deposit accounts includes general service fees for monthly account maintenance and activity- or transaction-based fees and consist of transaction-based revenue, time-based revenue (service period), item-based revenue or some other individual attribute-based revenue. Revenue is recognized when our performance obligation is completed which is generally monthly for account maintenance services or when a transaction has been completed (such as stop payment fees). Payment for such performance obligations are generally received at the time the performance obligations are satisfied. Other Service Charges and Fees Revenue from other service charges and fees includes cards and payments income, safe deposit rental income and other service charges, commissions and fees. Cards and payments income includes interchange fees from debit cards processed through card association networks, merchant services, and other card related services. Interchange rates are generally set by the credit card associations and based on purchase volumes and other factors. Interchange fees are recognized as transactions occur. Interchange expenses related to cards and payments income are presented gross in other operating expense. Merchant services income represents account management fees and transaction fees charged to merchants for the processing of card association network transactions. Merchant services revenue is recognized as transactions occur, or as services are performed. Other service charges, commissions and fees include automated teller machines ("ATM") surcharge and interchange fees, bill payment fees, cashier’s check and money order fees, wire transfer fees, loan brokerage fees, and commissions on sales of insurance, broker-dealer products, letters of credit, and travelers’ checks. Revenue from these fees and commissions is recorded in a manner that reflects the timing of when transactions occur, and as services are provided. Based on the nature of the commission agreement with the broker-dealer and each insurance provider, we may recognize revenue from broker-dealer and insurance commissions over time or at a point-in-time as our performance obligation is satisfied. Income from Fiduciary Activities Income from fiduciary activities includes fees from wealth management, trust, custodial and escrow services provided to individual and institutional customers. Revenue is generally recognized monthly based on a minimum annual fee and/or the market value of assets in custody. Additional fees are recognized for transactional activity. Revenue from trade execution and brokerage services is earned through commissions from trade execution on behalf of clients. Revenue from these transactions is recognized at the trade date. Any ongoing service fees are recognized on a monthly basis as services are performed. Fees on Foreign Exchange The Company provides foreign currency exchange services to customers, whereby cash can be converted to different foreign currencies, and vice versa. As a result of the services, a gain or loss is recognized on foreign currency transactions, as well as income related to commissions and fees earned on each transaction. Revenue from the commissions and fees earned on the transactions fall within the scope of ASC 606, and is recorded in a manner that reflects the timing of when transactions occur, and as services are provided. Realized and unrealized gains or losses related to foreign currency are out of scope of ASC 606. Loan Placement Fees Loan placement fees primarily represent revenues earned by the Company for loan placement and underwriting. Revenues for these services are recorded at a point-in-time, upon completion of a contractually identified transaction, or when an advisory opinion is provided. |
INVESTMENT SECURITIES (Tables) |
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of available for sale and held to maturity investment securities | A summary of our investment portfolio is 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 June 30, 2018 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 345 and 223 investment securities which were in an unrealized or unrecognized loss position at June 30, 2018 and December 31, 2017, respectively, aggregated by major security type and length of time in a continuous unrealized or unrecognized loss position.
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LOANS AND LEASES (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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 June 30, 2018 and December 31, 2017:
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Schedule of impaired loans, by class | The following table presents by class, information related to impaired loans as of June 30, 2018 and December 31, 2017:
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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 six months ended June 30, 2018 and 2017:
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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 June 30, 2018 and December 31, 2017:
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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 period presented. There were no loans modified in a TDR during the three and six months ended June 30, 2018 or the three months ended June 30, 2017.
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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 June 30, 2018 and December 31, 2017:
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ALLOWANCE FOR LOAN AND LEASE LOSSES (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of investment in unconsolidated subsidiaries | The following table presents amortization and tax credits recognized associated with our investments in LIHTC partnerships for the three and six months ended June 30, 2018 and June 30, 2017:
The components of the Company's investments in unconsolidated subsidiaries were as follows:
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CORE DEPOSIT PREMIUM AND MORTGAGE SERVICING RIGHTS (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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 core deposit premium and mortgage servicing rights are presented below:
The following table presents changes in core deposit premium and mortgage servicing rights for the six months ended June 30, 2018:
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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 June 30, 2018, estimated amortization expense for the remainder of fiscal year 2018, the next five succeeding fiscal years and all years thereafter are as follows:
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DERIVATIVES (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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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REVENUE FROM CONTRACTS WITH CUSTOMERS (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other operating income segregated by revenue streams | The following presents the Company's other operating income, segregated by revenue streams that are in-scope and out-of-scope of ASC 606 for the six months ended June 30, 2018 and 2017.
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MORTGAGE BANKING INCOME (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Income and Expenses [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Operating Cost and Expense, by Component | Noninterest income from the Company's mortgage banking activities include the following components for the periods indicated:
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SHARE-BASED COMPENSATION (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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 six months ended June 30, 2018:
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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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 six months ended June 30, 2018 and 2017, 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 six months ended June 30, 2018 and 2017:
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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 six months ended June 30, 2018 and 2017:
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PENSION AND SUPPLEMENTAL EXECUTIVE RETIREMENT PLANS (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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 for the periods indicated:
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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 for the periods indicated:
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EARNINGS PER SHARE (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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 fair value of assets and liabilities measured on a recurring basis as of June 30, 2018 and December 31, 2017:
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Schedule of changes in Level 3 assets and liabilities measured at fair value on a recurring basis | For the six months ended June 30, 2018 and 2017, 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 | the level of valuation assumptions used to determine the respective fair values as of June 30, 2018 and December 31, 2017:
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SEGMENT INFORMATION (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of segment profits (losses) and assets | Segment profits and assets are provided in the following table for the periods indicated.
|
INVESTMENT SECURITIES (Narrative) (Details) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2017
USD ($)
|
Jun. 30, 2018
USD ($)
security
|
Jun. 30, 2017
USD ($)
|
Dec. 31, 2017
USD ($)
security
|
|
Investments, Debt and Equity Securities [Abstract] | ||||
Available-for-sale securities, sold at par | $ 97,700 | |||
Number of investment securities in an unrealized loss position | security | 345 | 223 | ||
Investment securities pledged as collateral | $ 1,030,000 | $ 1,080,000 | ||
Payments to acquire available-for-sale securities | $ 97,400 | $ 85,313 | $ 253,372 | |
Available-for-sale securities, average term of securities sold | 3 years 4 months | |||
Available-for-sale securities, average yield of securities sold | 1.91% | |||
Available-for-sale securities, gross realized gains (losses), sale proceeds | $ 96,000 | |||
Available-for-sale securities, average term of securities acquired | 4 years 7 months | |||
Available-for-sale securities, average yield of securities acquired | 2.57% | |||
Available-for-sale securities, gross realized losses | $ 1,600 |
SECURITIZATIONS (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
SECURITIZATIONS | ||
Mortgage servicing rights | $ 15,756 | $ 15,843 |
Significant Other Observable Inputs (Level 2) | ||
SECURITIZATIONS | ||
Mortgage servicing rights | 0 | 0 |
Real estate, Mortgage - residential | Significant Other Observable Inputs (Level 2) | ||
SECURITIZATIONS | ||
Mortgage servicing rights | 1,200 | 1,500 |
Unrealized gains recorded in AOCI | $ 41 | $ 100 |
INVESTMENTS IN UNCONSOLIDATED SUBSIDIARIES (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
---|---|---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Dec. 31, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
|
Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures [Abstract] | |||||||
Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures, Investments in Low Income Housing Tax Credit Partnerships | $ 6,380 | $ 6,380 | $ 3,608 | ||||
Trust preferred investments | 2,792 | 2,792 | 2,792 | ||||
Investments in affiliates | 136 | 136 | 634 | ||||
Other | 54 | 54 | 54 | ||||
Investment in unconsolidated subsidiaries | 9,362 | 9,362 | 7,088 | ||||
Other Commitment | 5,600 | 5,600 | $ 2,600 | ||||
Estimated Affordable Housing Program Expense [Line Items] | |||||||
Amortization expense in pretax income | 113 | $ 223 | 227 | $ 456 | |||
Income tax credits and adjustments | $ 153 | $ 260 | $ 305 | $ 526 | |||
Scenario, Forecast [Member] | |||||||
Estimated Affordable Housing Program Expense [Line Items] | |||||||
Expected to be paid | $ 3,700 | $ 1,900 |
DERIVATIVES (Details) - Derivatives Not Designated as Hedging Instruments $ in Millions |
Jun. 30, 2018
USD ($)
|
---|---|
Interest rate lock commitments | |
DERIVATIVES | |
Mortgage loans hedged | $ 3.7 |
Forward sale commitments | |
DERIVATIVES | |
Mortgage loans hedged | $ 12.7 |
DERIVATIVES (Balance Sheet) (Details) - Derivatives Not Designated as Hedging Instruments - Interest rate lock and forward sale commitments - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Asset Derivatives | ||
Fair Value | $ 22 | $ 35 |
Liability Derivatives | ||
Fair Value | $ 51 | $ 49 |
DERIVATIVES (Income Statement) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
DERIVATIVES | ||||
Unrealized gain (loss) on interest rate locks | $ (36) | $ 80 | $ (15) | $ (127) |
Mortgage banking income | Derivatives Not Designated as Hedging Instruments | Derivatives Not in Cash Flow Hedging Relationship | Interest rate lock and forward sale commitments | ||||
DERIVATIVES | ||||
Unrealized gain (loss) on interest rate locks | (36) | 80 | (15) | (127) |
Other income | Derivatives Not Designated as Hedging Instruments | Derivatives Not in Cash Flow Hedging Relationship | Loans held-for-sale | ||||
DERIVATIVES | ||||
Unrealized gain (loss) on interest rate locks | $ 0 | $ (3) | $ 0 | $ (3) |
EQUITY (Details) - USD ($) |
1 Months Ended | 6 Months Ended | 12 Months Ended | |||
---|---|---|---|---|---|---|
Jan. 31, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Dec. 31, 2017 |
Nov. 30, 2017 |
Jan. 31, 2016 |
|
EQUITY | ||||||
Shares of common stock repurchased | 614,247 | 362,371 | ||||
Central Pacific Bank | ||||||
EQUITY | ||||||
Statutory retained earnings | $ 86,300,000 | |||||
Common Stock | ||||||
EQUITY | ||||||
Up to value of shares repurchased | $ 18,100,000 | $ 26,600,000 | ||||
Shares of common stock repurchased | 614,247 | 864,483 | ||||
Common Stock | 2016 Repurchase Plan | ||||||
EQUITY | ||||||
Up to value of shares repurchased | $ 100,000 | |||||
Shares of common stock repurchased | 1,750 | |||||
Amount authorized under the Repurchase Plan | $ 30,000,000.0 | $ 30,000,000.0 | ||||
Common Stock | 2017 Repurchase Plan | ||||||
EQUITY | ||||||
Amount authorized under the Repurchase Plan | $ 50,000,000.0 | |||||
Stock repurchase program, remaining authorized repurchase amount | $ 35,400,000 |
MORTGAGE BANKING INCOME (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Other Income and Expenses [Abstract] | ||||
Loan servicing fees | $ 1,289 | $ 1,340 | $ 2,600 | $ 2,698 |
Amortization of mortgage servicing rights | (437) | (547) | (894) | (1,067) |
Gain on sale of residential mortgage loans | 959 | 1,084 | 1,931 | 2,396 |
Unrealized gain (loss) on interest rate locks | (36) | 80 | (15) | (127) |
Total mortgage banking income | $ 1,775 | $ 1,957 | $ 3,622 | $ 3,900 |
SHARE-BASED COMPENSATION (Details) - Restricted Stock Awards and Units |
6 Months Ended |
---|---|
Jun. 30, 2018
$ / shares
shares
| |
Activity of nonvested shares | |
Nonvested restricted stock awards and units, beginning of period (in shares) | shares | 397,551 |
Changes during the period: | |
Granted (in shares) | shares | 112,794 |
Vested (in shares) | shares | (110,336) |
Forfeited (in shares) | shares | (18,977) |
Nonvested restricted stock awards and units, end of period (in shares) | shares | 381,032 |
Weighted Average Grant Date Fair Value | |
Nonvested restricted stock awards and units, beginning of period (in dollars per share) | $ / shares | $ 25.49 |
Changes during the period: | |
Granted (in dollars per share) | $ / shares | 29.55 |
Vested (in dollars per share) | $ / shares | 24.36 |
Forfeited (in dollars per share) | $ / shares | 27.47 |
Nonvested restricted stock awards and units, end of period (in dollars per share) | $ / shares | $ 26.93 |
PENSION AND SUPPLEMENTAL EXECUTIVE RETIREMENT PLANS (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Pension Plan | ||||
Components of net periodic benefit cost | ||||
Interest cost | $ 167 | $ 233 | $ 398 | $ 462 |
Expected return on plan assets | (345) | (264) | (604) | (528) |
Amortization of net actuarial loss | 192 | 300 | 490 | 596 |
Net periodic cost | 14 | 269 | 284 | 530 |
SERPs | ||||
PENSION AND SUPPLEMENTAL EXECUTIVE RETIREMENT PLANS | ||||
Defined Benefit Plan, Net Periodic Benefit Cost (Credit), Gain (Loss) Due to Settlement | 0 | (138) | 0 | (138) |
Components of net periodic benefit cost | ||||
Interest cost | 98 | 100 | 195 | 215 |
Amortization of net actuarial loss | 43 | 25 | 86 | 51 |
Amortization of net transition obligation | 4 | 5 | 9 | 9 |
Amortization of prior service cost | 4 | 4 | 9 | 8 |
Net periodic cost | $ 149 | $ 272 | $ 299 | $ 421 |
EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
SHARE-BASED COMPENSATION | ||||
Net income | $ 14,224 | $ 12,025 | $ 28,501 | $ 25,104 |
Weighted average shares outstanding - basic | 29,510,175 | 30,568,247 | 29,658,051 | 30,641,165 |
Weighted average shares outstanding - diluted | 29,714,942 | 30,803,725 | 29,881,534 | 30,879,923 |
Basic earnings per common share (in dollars per share) | $ 0.48 | $ 0.39 | $ 0.96 | $ 0.82 |
Diluted earnings per common share (in dollars per share) | $ 0.48 | $ 0.39 | $ 0.95 | $ 0.81 |
Antidilutive securities excluded from the dilutive share calculation (in shares) | 0 | 33 | 0 | 25 |
Stock Option | ||||
SHARE-BASED COMPENSATION | ||||
Dilutive effect of share-based compensation arrangements | 204,767 | 235,478 | 223,483 | 238,758 |
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