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☒ |
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the fiscal year ended December 31, 2016
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☐ |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from to .
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Delaware
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16‑1213679 |
(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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5790 Widewaters Parkway, DeWitt, New York
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13214-1883 |
(Address of principal executive offices)
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(Zip Code)
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(315) 445‑2282
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(Registrant's telephone number, including area code)
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Title of each class
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Name of each exchange on which registered
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Common Stock, Par Value $1.00 per share
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New York Stock Exchange
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Large accelerated filer ☒ |
Accelerated filer ☐
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Non-accelerated filer ☐
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Smaller reporting company ☐ .
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(Do not check if a smaller reporting company)
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PART I
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Page
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Item 1
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Business__________________________________________________________________________________________________________________
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3
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Item 1A
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Risk Factors _______________________________________________________________________________________________________________
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13
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Item 1B
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Unresolved Staff Comments ___________________________________________________________________________________________________
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19
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Item 2
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Properties_________________________________________________________________________________________________________________
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19
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Item 3
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Legal Proceedings___________________________________________________________________________________________________________
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20
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Item 4
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Mine Safety Disclosures______________________________________________________________________________________________________
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20
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Item 4A.
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Executive Officers of the Registrant______________________________________________________________________________________________
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20
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PART II
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Item 5
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Market for Registrant's Common Equity, Related Stockholders Matters and Issuer Purchases of Equity Securities___________________________________
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21
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Item 6
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Selected Financial Data_______________________________________________________________________________________________________
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23
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Item 7
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Management's Discussion and Analysis of Financial Condition and Results of Operations____________________________________________________
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25
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Item 7A
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Quantitative and Qualitative Disclosures about Market Risk___________________________________________________________________________
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51
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Item 8
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Financial Statements and Supplementary Data:
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Consolidated Statements of Condition_________________________________________________________________________________________
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54
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Consolidated Statements of Income___________________________________________________________________________________________
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55
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Consolidated Statements of Comprehensive Income_______________________________________________________________________________
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56
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Consolidated Statements of Changes in Shareholders' Equity________________________________________________________________________
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57
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Consolidated Statements of Cash Flows________________________________________________________________________________________
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58
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Notes to Consolidated Financial Statements_____________________________________________________________________________________
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59
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Report on Internal Control over Financial Reporting_______________________________________________________________________________
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98
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Report of Independent Registered Public Accounting Firm__________________________________________________________________________
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99
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Two Year Selected Quarterly Data______________________________________________________________________________________________
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100
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Item 9
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Changes in and Disagreements with Accountants on Accounting and Financial Disclosure___________________________________________________
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100
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Item 9A.
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Controls and Procedures_____________________________________________________________________________________________________
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100
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Item 9B.
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Other Information___________________________________________________________________________________________________________
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101
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PART III
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Item 10
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Directors, Executive Officers and Corporate Governance______________________________________________________________________________
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101
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Item 11
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Executive Compensation_____________________________________________________________________________________________________
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101
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Item 12
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Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters____________________________________________
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101
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Item 13
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Certain Relationships and Related Transactions, and Director Independence______________________________________________________________
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101
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Item 14
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Principal Accounting Fees and Services__________________________________________________________________________________________
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101
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PART IV
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Item 15
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Exhibits, Financial Statement Schedules__________________________________________________________________________________________
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102
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Item 16
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Form 10-K Summary_________________________________________________________________________________________________________
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105
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Signatures
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________________________________________________________________________________________________________________________
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106
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Number of
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|||||||||||||||||||||||||
County
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State
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Deposits as of 6/30/2016(1)
(000's omitted)
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Market
Share (1)
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Branches
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ATM's
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Towns/ Cities
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Towns Where Company
Has 1st or 2nd Market Position
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||||||||||||||||||
Lewis
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NY
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$
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198,077
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75.70
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%
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4
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4
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3
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3
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||||||||||||||||
Franklin
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NY
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322,707
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63.30
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%
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6
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6
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5
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5
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|||||||||||||||||
Hamilton
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NY
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54,393
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54.98
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%
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2
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2
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2
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2
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|||||||||||||||||
Madison
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NY
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465,922
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53.33
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%
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8
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8
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5
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5
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|||||||||||||||||
Allegany
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NY
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254,923
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48.16
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%
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9
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10
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8
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8
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|||||||||||||||||
Cattaraugus
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NY
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405,535
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42.84
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%
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10
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11
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7
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6
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|||||||||||||||||
Saint Lawrence
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NY
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430,746
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37.27
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%
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13
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11
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11
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10
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|||||||||||||||||
Otsego
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NY
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355,965
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34.69
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%
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10
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9
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6
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5
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|||||||||||||||||
Jefferson
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NY
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436,631
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28.15
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%
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7
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9
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6
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6
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Seneca
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NY
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131,020
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27.80
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%
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4
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3
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4
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4
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|||||||||||||||||
Clinton
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NY
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354,656
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26.80
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%
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4
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7
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2
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2
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|||||||||||||||||
Yates
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NY
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95,300
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25.70
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%
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3
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2
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2
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1
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|||||||||||||||||
Wyoming
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PA
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121,488
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24.65
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%
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4
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4
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4
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4
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|||||||||||||||||
Schuyler
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NY
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48,371
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24.43
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%
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1
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1
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1
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1
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Chautauqua
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NY
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349,177
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22.87
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%
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12
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12
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10
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7
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Livingston
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NY
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176,354
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22.51
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%
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5
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6
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5
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4
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Steuben
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NY
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187,672
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18.31
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%
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8
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8
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7
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4
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Essex
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NY
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120,533
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18.03
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%
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5
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5
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4
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4
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Wayne
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NY
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131,884
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15.62
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%
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3
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3
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2
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2
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Delaware
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NY
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144,681
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14.88
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%
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5
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5
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5
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5
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Ontario
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NY
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241,814
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12.07
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%
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8
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14
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5
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3
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Oswego
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NY
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169,822
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9.63
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%
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4
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5
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4
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2
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Tioga
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NY
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37,835
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8.62
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%
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2
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2
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2
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1
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Oneida
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NY
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273,502
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7.94
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%
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7
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7
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6
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5
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Lackawanna
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PA
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398,822
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7.66
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%
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11
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11
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8
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4
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Herkimer
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NY
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46,717
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7.55
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%
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1
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1
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1
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1
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Luzerne
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PA
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451,924
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7.44
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%
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10
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14
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8
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3
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Chemung
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NY
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74,589
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7.29
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%
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2
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2
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1
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0
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|||||||||||||||||
Susquehanna
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PA
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52,519
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6.41
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%
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3
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1
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3
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2
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|||||||||||||||||
Schoharie
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NY
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23,327
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5.38
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%
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1
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1
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1
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0
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Bradford
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PA
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46,941
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4.19
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%
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2
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2
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2
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1
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Carbon
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PA
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40,002
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4.07
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%
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2
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2
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2
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1
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Cayuga
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NY
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43,470
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4.03
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%
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2
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2
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2
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1
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Washington
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NY
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19,194
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2.67
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%
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1
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0
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1
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1
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Chenango
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NY
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22,852
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2.38
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%
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2
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2
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1
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0
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|||||||||||||||||
Warren
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NY
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32,543
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1.92
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%
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1
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1
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1
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1
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|||||||||||||||||
Onondaga
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NY
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151,245
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1.55
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%
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4
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4
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4
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1
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|||||||||||||||||
Broome
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NY
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32,133
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1.22
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%
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1
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1
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1
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0
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|||||||||||||||||
Ulster
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NY
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29,496
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0.97
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%
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1
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1
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1
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1
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|||||||||||||||||
Erie
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NY
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117,828
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0.29
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%
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4
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4
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3
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2
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|||||||||||||||||
Tompkins
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NY
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4,150
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0.22
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%
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1
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0
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1
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0
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|||||||||||||||||
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$
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7,096,760
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6.95
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%
|
193
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203
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157
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118
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||||||||||||||||
(1) Deposits and Market Share data as of June 30, 2016, the most recent information available from SNL Financial LLC. Deposit amounts include $138.9 million of intercompany balances that are eliminated upon consolidation. |
·
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4.5% CET1 to total risk-weighted assets;
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·
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6.0% Tier 1 capital (CET1 plus Additional Tier 1 capital) to total risk-weighted assets;
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·
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8.0% Total capital (Tier 1 Capital plus Tier 2 capital) to total risk-weighted assets;
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·
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4.0% Tier 1 capital to total adjusted quarterly average assets (known as "leverage ratio")
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·
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Changes in securities analysts' expectations of financial performance;
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·
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Volatility of stock market prices and volumes;
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·
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Incorrect information or speculation;
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·
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Changes in industry valuations;
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·
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Variations in operating results from general expectations;
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·
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Actions taken against the Company by various regulatory agencies;
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·
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Changes in authoritative accounting guidance by the Financial Accounting Standards Board or other regulatory agencies;
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·
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Changes in general domestic economic conditions such as inflation rates, tax rates, unemployment rates, oil prices, labor and healthcare cost trend rates, recessions, and changing government policies, laws and regulations; and
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·
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Severe weather, natural disasters, acts of war or terrorism and other external events.
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Name
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Age
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Position
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Mark E. Tryniski
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56
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Director, President and Chief Executive Officer. Mr. Tryniski assumed his current position in August 2006. He served as Executive Vice President and Chief Operating Officer from March 2004 to July 2006 and as the Treasurer and Chief Financial Officer from June 2003 to March 2004. He previously served as a partner in the Syracuse office of PricewaterhouseCoopers LLP.
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Scott Kingsley
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52
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Executive Vice President and Chief Financial Officer. Mr. Kingsley joined the Company in August 2004 in his current position. He served as Vice President and Chief Financial Officer of Carlisle Engineered Products, Inc., a subsidiary of the Carlisle Companies, Inc., from 1997 until joining the Company.
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Brian D. Donahue
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60
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Executive Vice President and Chief Banking Officer. Mr. Donahue assumed his current position in August 2004. He served as the Bank's Chief Credit Officer from February 2000 to July 2004 and as the Senior Lending Officer for the Southern Region of the Bank from 1992 until June 2004.
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George J. Getman
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60
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Executive Vice President and General Counsel. Mr. Getman assumed his current position in January 2008. Prior to joining the Company, he was a partner with Bond, Schoeneck & King, PLLC and served as corporate counsel to the Company.
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Year / Qtr
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High Price
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Low Price
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Quarterly Dividend
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|||||||||
2016
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||||||||||||
4th
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$
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62.24
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$
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46.07
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$
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0.32
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||||||
3rd
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$
|
48.11
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$
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39.96
|
$
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0.32
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||||||
2nd
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$
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42.18
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$
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36.78
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$
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0.31
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||||||
1st
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$
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39.23
|
$
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34.47
|
$
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0.31
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||||||
2015
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||||||||||||
4th
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$
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43.13
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$
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36.70
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$
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0.31
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||||||
3rd
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$
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39.80
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$
|
34.21
|
$
|
0.31
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||||||
2nd
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$
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38.52
|
$
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34.58
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$
|
0.30
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||||||
1st
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$
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37.71
|
$
|
33.60
|
$
|
0.30
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Plan Category
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Number of Securities to be Issued upon Exercise of Outstanding Options, Warrants and Rights (1)
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Weighted-average Exercise Price
of Outstanding Options, Warrants and Rights
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Number of Securities Remaining Available For Future Issuance Under Equity Compensation Plans (excluding securities reflected in the first column)
|
|||||||||
Equity compensation plans approved by security holders:
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||||||||||||
1994 Long-term Incentive Plan
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12,883
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$
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17.41
|
5,701
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||||||||
2004 Long-term Incentive Plan
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1,215,998
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26.51
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48,830
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|||||||||
2014 Long-term Incentive Plan
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780,941
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27.80
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889,482
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|||||||||
Equity compensation plans not approved by security holders
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0
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0
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0
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|||||||||
Total
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2,009,822
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$
|
26.95
|
944,013
|
||||||||
(1) The number of securities includes 253,830 shares of unvested restricted stock. |
Issuer Purchases of Equity Securities
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||||||||||||||||
Period
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Total
Number of Shares Purchased
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Average
Price Paid
Per share
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Total Number of Shares Purchased as Part of
Publicly Announced
Plans or Programs
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Maximum Number of Shares That May Yet be Purchased Under the Plans or Programs
|
||||||||||||
October 1-31, 2016
|
0
|
$
|
0
|
0
|
2,200,000
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|||||||||||
November 1-30, 2016(1)
|
50,952
|
54.14
|
0
|
2,200,000
|
||||||||||||
December 1-31, 2016
|
0
|
0
|
0
|
2,200,000
|
||||||||||||
Total
|
50,952
|
$
|
54.14
|
|||||||||||||
(1) Included in the common shares repurchased were 91 shares acquired by the Company in connection with satisfaction of tax withholding obligations on vested restricted stock issued pursuant to the employee benefit plan and 50,861 shares acquired by the Company in connection with the administration of the Company's retirement plan. These shares were not repurchased as part of the publicly announced repurchase plan described above.
|
Years Ended December 31,
|
||||||||||||||||||||
(In thousands except per share data and ratios)
|
2016
|
2015
|
2014
|
2013
|
2012
|
|||||||||||||||
Income Statement Data:
|
||||||||||||||||||||
Loan interest income
|
$
|
211,467
|
$
|
187,743
|
$
|
185,527
|
$
|
188,197
|
$
|
192,710
|
||||||||||
Investment interest income
|
73,720
|
71,879
|
70,693
|
75,962
|
88,690
|
|||||||||||||||
Interest expense
|
11,291
|
11,202
|
11,792
|
26,065
|
50,976
|
|||||||||||||||
Net interest income
|
273,896
|
248,420
|
244,428
|
238,094
|
230,424
|
|||||||||||||||
Provision for loan losses
|
8,076
|
6,447
|
7,178
|
7,992
|
9,108
|
|||||||||||||||
Noninterest income
|
155,625
|
123,303
|
119,020
|
108,748
|
98,955
|
|||||||||||||||
Gain (loss) on investment securities & early
retirement of long-term borrowings, net
|
0
|
(4
|
)
|
0
|
(6,568
|
)
|
291
|
|||||||||||||
Acquisition expenses and litigation settlement
|
1,706
|
7,037
|
2,923
|
2,181
|
8,247
|
|||||||||||||||
Other noninterest expenses
|
265,142
|
226,018
|
223,657
|
219,074
|
203,510
|
|||||||||||||||
Income before income taxes
|
154,597
|
132,217
|
129,690
|
111,027
|
108,805
|
|||||||||||||||
Net income
|
103,812
|
91,230
|
91,353
|
78,829
|
77,068
|
|||||||||||||||
Diluted earnings per share
|
2.32
|
2.19
|
2.22
|
1.94
|
1.93
|
|||||||||||||||
Balance Sheet Data:
|
||||||||||||||||||||
Cash equivalents
|
$
|
24,243
|
$
|
21,931
|
$
|
12,870
|
$
|
11,288
|
$
|
84,415
|
||||||||||
Investment securities
|
2,784,392
|
2,847,940
|
2,512,974
|
2,218,725
|
2,818,527
|
|||||||||||||||
Loans
|
4,948,562
|
4,801,375
|
4,236,206
|
4,109,083
|
3,865,576
|
|||||||||||||||
Allowance for loan losses
|
(47,233
|
)
|
(45,401
|
)
|
(45,341
|
)
|
(44,319
|
)
|
(42,888
|
)
|
||||||||||
Intangible assets
|
480,844
|
484,146
|
386,973
|
390,499
|
387,134
|
|||||||||||||||
Total assets
|
8,666,437
|
8,552,669
|
7,489,440
|
7,095,864
|
7,496,800
|
|||||||||||||||
Deposits
|
7,075,954
|
6,873,474
|
5,935,264
|
5,896,044
|
5,628,039
|
|||||||||||||||
Borrowings
|
248,370
|
403,446
|
440,122
|
244,010
|
830,134
|
|||||||||||||||
Shareholders' equity
|
1,198,100
|
1,140,647
|
987,904
|
875,812
|
902,778
|
|||||||||||||||
Capital and Related Ratios:
|
||||||||||||||||||||
Cash dividends declared per share
|
$
|
1.26
|
$
|
1.22
|
$
|
1.16
|
$
|
1.10
|
$
|
1.06
|
||||||||||
Book value per share
|
26.96
|
26.06
|
24.24
|
21.66
|
22.78
|
|||||||||||||||
Tangible book value per share (1)
|
17.12
|
15.90
|
15.63
|
12.80
|
13.72
|
|||||||||||||||
Market capitalization (in millions)
|
2,746
|
1,748
|
1,554
|
1,604
|
1,084
|
|||||||||||||||
Tier 1 leverage ratio
|
10.55
|
%
|
10.32
|
%
|
9.96
|
%
|
9.29
|
%
|
8.40
|
%
|
||||||||||
Total risk-based capital to risk-adjusted assets
|
19.10
|
%
|
18.08
|
%
|
18.75
|
%
|
17.57
|
%
|
16.20
|
%
|
||||||||||
Tangible equity to tangible assets (1)
|
9.24
|
%
|
8.59
|
%
|
8.92
|
%
|
7.68
|
%
|
7.62
|
%
|
||||||||||
Dividend payout ratio
|
53.7
|
%
|
55.5
|
%
|
51.6
|
%
|
56.0
|
%
|
54.3
|
%
|
||||||||||
Period end common shares outstanding
|
44,437
|
43,775
|
40,748
|
40,431
|
39,626
|
|||||||||||||||
Diluted weighted-average shares outstanding
|
44,720
|
41,605
|
41,232
|
40,726
|
39,927
|
|||||||||||||||
Selected Performance Ratios:
|
||||||||||||||||||||
Return on average assets
|
1.20
|
%
|
1.17
|
%
|
1.23
|
%
|
1.09
|
%
|
1.08
|
%
|
||||||||||
Return on average equity
|
8.57
|
%
|
8.87
|
%
|
9.65
|
%
|
9.04
|
%
|
8.82
|
%
|
||||||||||
Net interest margin
|
3.71
|
%
|
3.73
|
%
|
3.91
|
%
|
3.91
|
%
|
3.88
|
%
|
||||||||||
Noninterest income/operating income (FTE)
|
35.4
|
%
|
32.1
|
%
|
31.4
|
%
|
30.0
|
%
|
28.6
|
%
|
||||||||||
Efficiency ratio (2)
|
59.2
|
%
|
57.9
|
%
|
57.9
|
%
|
59.3
|
%
|
57.4
|
%
|
||||||||||
Asset Quality Ratios:
|
||||||||||||||||||||
Allowance for loan losses/total loans
|
0.95
|
%
|
0.95
|
%
|
1.07
|
%
|
1.08
|
%
|
1.11
|
%
|
||||||||||
Nonperforming loans/total loans
|
0.48
|
%
|
0.50
|
%
|
0.56
|
%
|
0.54
|
%
|
0.75
|
%
|
||||||||||
Allowance for loan losses/nonperforming loans
|
199
|
%
|
190
|
%
|
190
|
%
|
201
|
%
|
147
|
%
|
||||||||||
Loan loss provision/net charge-offs
|
129
|
%
|
101
|
%
|
117
|
%
|
122
|
%
|
108
|
%
|
||||||||||
Net charge-offs/average loans
|
0.13
|
%
|
0.15
|
%
|
0.15
|
%
|
0.17
|
%
|
0.23
|
%
|
(1) The tangible book value per share and the tangible equity to tangible asset ratio excludes goodwill and identifiable intangible assets, adjusted for deferred tax liabilities generated from tax deductible goodwill. The ratio is not a financial measurement required by accounting principles generally accepted in the United States of America. However, management believes such information is useful to analyze the relative strength of the Company's capital position and is useful to investors in evaluating Company performance (See Table 20 for Reconciliation of GAAP to Non-GAAP Measures).
|
(2) Efficiency ratio provides a ratio of operating expenses to operating income. It excludes intangible amortization, acquisition expenses, and litigation settlement from expenses and gains and losses on investment securities & early retirement of long-term borrowings from income while adding a fully-taxable equivalent adjustment. The efficiency ratio is not a financial measurement required by accounting principles generally accepted in the United States of America. However, the efficiency ratio is used by management in its assessment of financial performance specifically as it relates to noninterest expense control. Management also believes such information is useful to investors in evaluating Company performance. |
·
|
Acquired loans – Acquired loans are initially recorded at their acquisition date fair values based on a discounted cash flow methodology that involves assumptions and judgments as to credit risk, prepayment risk, liquidity risk, default rates, loss severity, payment speeds, collateral values and discount rate.
|
·
|
Allowance for loan losses – The allowance for loan losses reflects management's best estimate of probable loan losses in the Company's loan portfolio. Determination of the allowance for loan losses is inherently subjective. It requires significant estimates, including the amounts and timing of expected future cash flows on impaired loans, appraisal values of underlying collateral for collateralized loans, and the amount of estimated losses on pools of homogeneous loans which is based on historical loss experience and consideration of current economic trends, all of which may be susceptible to significant change.
|
·
|
Investment securities – Investment securities can be classified as held-to-maturity, available-for-sale or trading. The appropriate classification is based partially on the Company's ability to hold the securities to maturity and largely on management's intentions with respect to either holding or selling the securities. The classification of investment securities is significant since it directly impacts the accounting for unrealized gains and losses on securities. Unrealized gains and losses on available-for-sale securities are recorded in accumulated other comprehensive income or loss, as a separate component of shareholders' equity, and do not affect earnings until realized. The fair values of investment securities are generally determined by reference to quoted market prices, where available. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments, or a discounted cash flow model using market estimates of interest rates and volatility. Investment securities with significant declines in fair value are evaluated to determine whether they should be considered other-than-temporarily impaired ("OTTI"). An unrealized loss is generally deemed to be other-than-temporary and a credit loss is deemed to exist if the present value of the expected future cash flows is less than the amortized cost basis of the debt security. The credit loss component of an other-than-temporary impairment write-down is recorded in current earnings, while the remaining portion of the impairment loss is recognized in other comprehensive income (loss), provided the Company does not intend to sell the underlying debt security, and it is not likely that the Company will be required to sell the debt security prior to recovery of the full value of its amortized cost basis. During 2013, the Company sold certain held-to-maturity securities and consequently did not use the held-to-maturity classification in 2014, 2015 or 2016.
|
·
|
Retirement benefits - The Company provides defined benefit pension benefits to eligible employees and retirees and post-retirement health and life insurance benefits to certain eligible retirees. The Company also provides deferred compensation and supplemental executive retirement plans for selected current and former employees. Expense under these plans is charged to current operations and consists of several components of net periodic (benefit) cost based on various actuarial assumptions regarding future experience under the plans, including, but not limited to, discount rate, rate of future compensation increases, mortality rates, future health care costs and the expected return on plan assets.
|
·
|
Provision for income taxes – The Company is subject to examinations from various taxing authorities. Such examinations may result in challenges to the tax return treatment applied by the Company to specific transactions. Management believes that the assumptions and judgments used to record tax-related assets or liabilities have been appropriate. Should tax laws change or the taxing authorities determine that management's assumptions were inappropriate, an adjustment may be required which could have a material effect on the Company's results of operations.
|
·
|
Intangible assets – As a result of acquisitions, the Company carries goodwill and identifiable intangible assets. Goodwill represents the cost of acquired companies in excess of the fair value of net assets at the acquisition date. Goodwill is evaluated at least annually, or when business conditions suggest impairment may have occurred. Should impairment occur, goodwill will be reduced to its carrying value through a charge to earnings. Core deposits and other identifiable intangible assets are amortized to expense over their estimated useful lives. The determination of whether or not impairment exists is based upon discounted cash flow modeling techniques that require management to make estimates regarding the amount and timing of expected future cash flows. It also requires them to select a discount rate that reflects the current return requirements of the market in relation to present risk-free interest rates, required equity market premiums, and company-specific performance and risk metrics, all of which are susceptible to change based on changes in economic and market conditions and other factors. Future events or changes in the estimates used to determine the carrying value of goodwill and identifiable intangible assets could have a material impact on the Company's results of operations.
|
|
Years Ended December 31,
|
|||||||||||||||||||
(000's omitted, except per share data)
|
2016
|
2015
|
2014
|
2013
|
2012
|
|||||||||||||||
Net interest income
|
$
|
273,896
|
$
|
248,420
|
$
|
244,428
|
$
|
238,094
|
$
|
230,424
|
||||||||||
Provision for loan losses
|
8,076
|
6,447
|
7,178
|
7,992
|
9,108
|
|||||||||||||||
(Loss)/Gain on sales of investment securities, net
|
0
|
(4
|
)
|
0
|
80,768
|
291
|
||||||||||||||
Loss on debt extinguishments
|
0
|
0
|
0
|
87,336
|
0
|
|||||||||||||||
Noninterest income
|
155,625
|
123,303
|
119,020
|
108,748
|
98,955
|
|||||||||||||||
Acquisition expenses and litigation settlement
|
1,706
|
7,037
|
2,923
|
2,181
|
8,247
|
|||||||||||||||
Other noninterest expenses
|
265,142
|
226,018
|
223,657
|
219,074
|
203,510
|
|||||||||||||||
Income before taxes
|
154,597
|
132,217
|
129,690
|
111,027
|
108,805
|
|||||||||||||||
Income taxes
|
50,785
|
40,987
|
38,337
|
32,198
|
31,737
|
|||||||||||||||
Net income
|
$
|
103,812
|
$
|
91,230
|
$
|
91,353
|
$
|
78,829
|
$
|
77,068
|
||||||||||
|
||||||||||||||||||||
Diluted weighted average common shares outstanding
|
44,720
|
41,605
|
41,232
|
40,726
|
39,927
|
|||||||||||||||
Diluted earnings per share
|
$
|
2.32
|
$
|
2.19
|
$
|
2.22
|
$
|
1.94
|
$
|
1.93
|
·
|
Net interest income increased $25.4 million, or 10.2%. This was the result of a $668.4 million increase in average earning assets, partially offset by a two basis point decrease in the net interest margin. Average loans grew $593.8 million related to both the Oneida acquisition and organic growth. Also contributing to the growth in interest-earning assets was a $74.6 million increase in the average book value of investments, including cash equivalents, partially offset by a six basis-point decrease in the average yield on investments. Average interest-bearing deposits increased $671.7 million due to the Oneida acquisition and organic core deposit growth, partially offset by the continued trend of declining time deposit balances. Borrowing interest expense decreased as a result of a decrease in average balances of $241.9 million, or 47.1%, compared to the prior year, partially offset by a blended rate that was 64 basis points higher than the prior year.
|
·
|
The loan loss provision of $8.1 million increased $1.6 million, or 25.3%, from the prior year level. Net charge‑offs of $6.2 million were $0.1 million less than 2015. This resulted in an annual net charge-off ratio (net charge-offs / total average loans) of 0.13%, which was two basis points lower than the prior year. Nonperforming loans as a percentage of total loans and nonperforming assets as a percentage of loans and other real estate owned, each decreased two basis points compared to December 31, 2015 levels, and remain better than levels for the Company's peers. Additional information on trends and policy related to asset quality is provided in the asset quality section on pages 41 through 45.
|
·
|
Banking noninterest income for 2016 of $66.1 million increased by $8.4 million from 2015's level, primarily due to new deposit relationships from both acquired and organic sources, increased debit card-related revenues and $1.6 million in nonrecurring insurance-related gains, partially offset by the continuing trend of lower utilization of overdraft protection programs and other deposit-related services.
|
·
|
Total banking noninterest expenses, including acquisition expenses, increased $9.3 million, or 5.0%, in 2016 to $194.0 million, primarily reflective of a full year of expenses related to an expanded branch network and other acquired activities from the Oneida acquisition, and continued investment in risk management capabilities and technology and data processing costs. Excluding acquisition expenses, banking noninterest expenses increased $15.2 million, or 8.6%, again reflective of expanded operations resulting from the Oneida acquisition.
|
·
|
Employee benefit services noninterest income for 2016 of $48.3 million increased $1.5 million, or 3.2%, from the prior year level, benefiting from a combination of new client generation, activities acquired with the Oneida transaction and expanded service offerings.
|
·
|
Employee benefit services noninterest expenses for 2016 totaled $37.8 million. This represented an increase from 2015 of $2.0 million, or 5.7%, and was attributable to the continued buildout of resources to support an expanding revenue base.
|
·
|
Wealth management and insurance services noninterest income for 2016 was $43.7 million; an increase of $22.8 million from the prior year level. The increase was primarily due to the addition of the OneGroup and OWM businesses in conjunction with the Oneida acquisition.
|
·
|
Wealth management and insurance services noninterest expenses of $37.6 million increased $22.8 million from 2015 primarily due to the acquisition of OneGroup and OWM, and increased personnel costs associated with growth initiatives.
|
|
2016
|
2015
|
2014
|
|||||||||
Return on average assets
|
1.20
|
%
|
1.17
|
%
|
1.23
|
%
|
||||||
Return on average equity
|
8.57
|
%
|
8.87
|
%
|
9.65
|
%
|
||||||
Dividend payout ratio
|
53.7
|
%
|
55.5
|
%
|
51.6
|
%
|
||||||
Average equity to average assets
|
13.99
|
%
|
13.16
|
%
|
12.75
|
%
|
Year Ended December 31, 2016
|
Year Ended December 31, 2015
|
Year Ended December 31, 2014
|
||||||||||||||||||||||||||||||||||
(000's omitted except yields and rates)
|
Average Balance
|
Interest
|
Avg. Yield/Rate Paid
|
Average Balance
|
Interest
|
Avg. Yield/Rate Paid
|
Average Balance
|
Interest
|
Avg. Yield/Rate Paid
|
|||||||||||||||||||||||||||
Interest-earning assets:
|
||||||||||||||||||||||||||||||||||||
Cash equivalents
|
$
|
19,062
|
$
|
89
|
0.47
|
%
|
$
|
13,543
|
$
|
32
|
0.23
|
%
|
$
|
9,701
|
$
|
21
|
0.21
|
%
|
||||||||||||||||||
Taxable investment securities (1)
|
2,177,589
|
56,113
|
2.58
|
%
|
2,071,095
|
53,282
|
2.57
|
%
|
1,834,430
|
52,268
|
2.85
|
%
|
||||||||||||||||||||||||
Nontaxable investment securities (1)
|
579,986
|
26,924
|
4.64
|
%
|
617,418
|
29,205
|
4.73
|
%
|
640,737
|
32,737
|
5.11
|
%
|
||||||||||||||||||||||||
Loans (net of unearned discount)(2)
|
4,881,905
|
212,022
|
4.34
|
%
|
4,288,091
|
189,507
|
4.42
|
%
|
4,156,840
|
186,727
|
4.49
|
%
|
||||||||||||||||||||||||
Total interest-earning assets
|
7,658,542
|
295,148
|
3.85
|
%
|
6,990,147
|
272,026
|
3.89
|
%
|
6,641,708
|
271,753
|
4.09
|
%
|
||||||||||||||||||||||||
Noninterest-earning assets
|
1,001,525
|
824,417
|
782,195
|
|||||||||||||||||||||||||||||||||
Total assets
|
$
|
8,660,067
|
$
|
7,814,564
|
$
|
7,423,903
|
||||||||||||||||||||||||||||||
Interest-bearing liabilities:
|
||||||||||||||||||||||||||||||||||||
Interest checking, savings and money
market deposits
|
$
|
4,712,212
|
4,121
|
0.09
|
%
|
$
|
4,053,761
|
3,598
|
0.09
|
%
|
$
|
3,867,818
|
3,614
|
0.09
|
%
|
|||||||||||||||||||||
Time deposits
|
750,944
|
3,204
|
0.43
|
%
|
737,734
|
3,373
|
0.46
|
%
|
845,035
|
4,576
|
0.54
|
%
|
||||||||||||||||||||||||
FHLB borrowings
|
169,769
|
1,017
|
0.60
|
%
|
411,694
|
1,694
|
0.41
|
%
|
303,295
|
1,125
|
0.37
|
%
|
||||||||||||||||||||||||
Subordinated debt held by unconsolidated
subsidiary trusts
|
102,158
|
2,949
|
2.89
|
%
|
102,133
|
2,537
|
2.48
|
%
|
102,116
|
2,477
|
2.43
|
%
|
||||||||||||||||||||||||
Total interest-bearing liabilities
|
5,735,083
|
11,291
|
0.20
|
%
|
5,305,322
|
11,202
|
0.21
|
%
|
5,118,264
|
11,792
|
0.23
|
%
|
||||||||||||||||||||||||
Noninterest-bearing liabilities:
|
||||||||||||||||||||||||||||||||||||
Noninterest checking deposits
|
1,558,548
|
1,352,683
|
1,249,807
|
|||||||||||||||||||||||||||||||||
Other liabilities
|
154,916
|
128,521
|
109,206
|
|||||||||||||||||||||||||||||||||
Shareholders' equity
|
1,211,520
|
1,028,038
|
946,626
|
|||||||||||||||||||||||||||||||||
Total liabilities and shareholders' equity
|
$
|
8,660,067
|
$
|
7,814,564
|
$
|
7,423,903
|
||||||||||||||||||||||||||||||
Net interest earnings
|
$
|
283,857
|
$
|
260,824
|
$
|
259,961
|
||||||||||||||||||||||||||||||
Net interest spread
|
3.65
|
%
|
3.68
|
%
|
3.86
|
%
|
||||||||||||||||||||||||||||||
Net interest margin on interest-earning
assets
|
3.71
|
%
|
3.73
|
%
|
3.91
|
%
|
||||||||||||||||||||||||||||||
Fully tax-equivalent adjustment
|
$
|
9,961
|
$
|
12,404
|
$
|
15,533
|
(1) Averages for investment securities are based on historical cost and the yields do not give effect to changes in fair value that is reflected as a component of shareholders' equity and deferred taxes.
|
(2) Includes nonaccrual loans. The impact of interest and fees not recognized on nonaccrual loans was immaterial.
|
2016 Compared to 2015
|
2015 Compared to 2014
|
|||||||||||||||||||||||
Increase (Decrease) Due to Change in (1)
|
Increase (Decrease) Due to Change in (1)
|
|||||||||||||||||||||||
(000's omitted)
|
Volume
|
Rate
|
Net Change
|
Volume
|
Rate
|
Net Change
|
||||||||||||||||||
Interest earned on:
|
||||||||||||||||||||||||
Cash equivalents
|
$
|
17
|
$
|
40
|
$
|
57
|
$
|
9
|
$
|
2
|
$
|
11
|
||||||||||||
Taxable investment securities
|
2,745
|
86
|
2,831
|
6,369
|
(5,355
|
)
|
1,014
|
|||||||||||||||||
Nontaxable investment securities
|
(1,746
|
)
|
(535
|
)
|
(2,281
|
)
|
(1,162
|
)
|
(2,370
|
)
|
(3,532
|
)
|
||||||||||||
Loans (net of unearned discount)
|
25,840
|
(3,325
|
)
|
22,515
|
5,833
|
(3,053
|
)
|
2,780
|
||||||||||||||||
Total interest-earning assets (2)
|
25,782
|
(2,660
|
)
|
23,122
|
13,897
|
(13,624
|
)
|
273
|
||||||||||||||||
Interest paid on:
|
||||||||||||||||||||||||
Interest checking, savings and money market deposits
|
577
|
(54
|
)
|
523
|
170
|
(186
|
)
|
(16
|
)
|
|||||||||||||||
Time deposits
|
59
|
(228
|
)
|
(169
|
)
|
(540
|
)
|
(663
|
)
|
(1,203
|
)
|
|||||||||||||
Short-term borrowings
|
(1,250
|
)
|
573
|
(677
|
)
|
436
|
133
|
569
|
||||||||||||||||
Long-term borrowings
|
1
|
411
|
412
|
0
|
60
|
60
|
||||||||||||||||||
Total interest-bearing liabilities (2)
|
874
|
(785
|
)
|
89
|
420
|
(1,010
|
)
|
(590
|
)
|
|||||||||||||||
Net interest earnings (2)
|
$
|
24,784
|
$
|
(1,751
|
)
|
$
|
23,033
|
$
|
13,302
|
$
|
(12,439
|
)
|
$
|
863
|
(1) The change in interest due to both rate and volume has been allocated to volume and rate changes in proportion to the relationship of the absolute dollar amounts of change in each.
|
(2) Changes due to volume and rate are computed from the respective changes in average balances and rates of the totals; they are not a summation of the changes of the components.
|
|
Years Ended December 31,
|
|||||||||||
(000's omitted except ratios)
|
2016
|
2015
|
2014
|
|||||||||
Employee benefit services
|
$
|
46,628
|
$
|
45,388
|
$
|
42,580
|
||||||
Deposit service charges and fees
|
29,061
|
28,087
|
29,379
|
|||||||||
Electronic banking
|
25,781
|
22,263
|
21,156
|
|||||||||
Insurance services
|
23,149
|
3,352
|
1,450
|
|||||||||
Wealth management services
|
19,776
|
16,856
|
16,420
|
|||||||||
Other banking revenues
|
9,140
|
5,656
|
6,576
|
|||||||||
Mortgage banking
|
2,090
|
1,701
|
1,459
|
|||||||||
Subtotal
|
155,625
|
123,303
|
119,020
|
|||||||||
Loss on sales of investment securities, net
|
0
|
(4
|
)
|
0
|
||||||||
Total noninterest income
|
$
|
155,625
|
$
|
123,299
|
$
|
119,020
|
||||||
|
||||||||||||
Noninterest income/operating income (FTE basis) (1)
|
35.4
|
%
|
32.1
|
%
|
31.4
|
%
|
(1) For purposes of this ratio noninterest income excludes gains (losses) on sales of investment securities. Operating income is defined as net interest income on a fully-tax equivalent basis, plus noninterest income, excluding gains (losses) on sales of investment securities.
|
|
Years Ended December 31,
|
|||||||||||
(000's omitted)
|
2016
|
2015
|
2014
|
|||||||||
Salaries and employee benefits
|
$
|
151,647
|
$
|
126,356
|
$
|
123,077
|
||||||
Occupancy and equipment
|
30,078
|
27,593
|
27,948
|
|||||||||
Data processing and communications
|
34,501
|
30,430
|
29,294
|
|||||||||
Amortization of intangible assets
|
5,479
|
3,663
|
4,287
|
|||||||||
Legal and professional fees
|
8,455
|
6,813
|
7,247
|
|||||||||
Office supplies and postage
|
7,274
|
6,476
|
6,270
|
|||||||||
Business development and marketing
|
7,484
|
7,204
|
7,125
|
|||||||||
FDIC insurance premiums
|
3,671
|
3,962
|
3,899
|
|||||||||
Acquisition expenses and litigation settlement
|
1,706
|
7,037
|
2,923
|
|||||||||
Other
|
16,553
|
13,521
|
14,510
|
|||||||||
Total noninterest expenses
|
$
|
266,848
|
$
|
233,055
|
$
|
226,580
|
||||||
|
||||||||||||
Operating expenses(1) /average assets
|
3.00
|
%
|
2.85
|
%
|
2.95
|
%
|
||||||
Efficiency ratio
|
59.2
|
%
|
57.9
|
%
|
57.9
|
%
|
||||||
(1)Operating expenses are total noninterest expenses excluding acquisition expenses, litigation settlement charges and amortization of intangible assets. See Table 20 for Reconciliation of GAAP to Non-GAAP Measures.
|
(000's omitted)
|
Balance at December 31, 2015
|
Additions
|
Amortization
|
Impairment
|
Balance at December 31, 2016
|
|||||||||||||||
Banking Segment
|
||||||||||||||||||||
Goodwill
|
$
|
439,052
|
$
|
1,818
|
$
|
0
|
$
|
0
|
$
|
440,870
|
||||||||||
Core deposit intangibles
|
9,789
|
0
|
2,682
|
0
|
7,107
|
|||||||||||||||
Total Banking Segment
|
448,841
|
1,818
|
2,682
|
0
|
447,977
|
|||||||||||||||
Employee Benefit Services Segment
|
||||||||||||||||||||
Goodwill
|
8,019
|
0
|
0
|
0
|
8,019
|
|||||||||||||||
Other intangibles
|
1,086
|
0
|
420
|
0
|
666
|
|||||||||||||||
Total Employee Benefit Services Segment
|
9,105
|
0
|
420
|
0
|
8,685
|
|||||||||||||||
All Other Segment
|
||||||||||||||||||||
Goodwill
|
16,181
|
72
|
0
|
0
|
16,253
|
|||||||||||||||
Other intangibles
|
10,019
|
287
|
2,377
|
0
|
7,929
|
|||||||||||||||
Total All Other Segment
|
26,200
|
359
|
2,377
|
0
|
24,182
|
|||||||||||||||
Total
|
$
|
484,146
|
$
|
2,177
|
$
|
5,479
|
$
|
0
|
$
|
480,844
|
(000's omitted)
|
2016
|
2015
|
2014
|
2013
|
2012
|
|||||||||||||||
Consumer mortgage
|
$
|
1,819,701
|
$
|
1,769,754
|
$
|
1,613,384
|
$
|
1,582,058
|
$
|
1,448,415
|
||||||||||
Business lending
|
1,490,076
|
1,497,271
|
1,262,484
|
1,260,364
|
1,233,944
|
|||||||||||||||
Consumer indirect
|
1,044,972
|
935,760
|
833,968
|
740,002
|
647,518
|
|||||||||||||||
Consumer direct
|
191,815
|
195,076
|
184,028
|
180,139
|
171,474
|
|||||||||||||||
Home equity
|
401,998
|
403,514
|
342,342
|
346,520
|
364,225
|
|||||||||||||||
Gross loans
|
4,948,562
|
4,801,375
|
4,236,206
|
4,109,083
|
3,865,576
|
|||||||||||||||
Allowance for loan losses
|
(47,233
|
)
|
(45,401
|
)
|
(45,341
|
)
|
(44,319
|
)
|
(42,888
|
)
|
||||||||||
Loans, net of allowance for loan losses
|
$
|
4,901,329
|
$
|
4,755,974
|
$
|
4,190,865
|
$
|
4,064,764
|
$
|
3,822,688
|
||||||||||
Daily average of total gross loans
|
$
|
4,881,905
|
$
|
4,288,091
|
$
|
4,156,840
|
$
|
3,954,515
|
$
|
3,628,006
|
(000's omitted)
|
Maturing in One Year or Less
|
Maturing After One but Within Five Years
|
Maturing After Five Years
|
Total
|
||||||||||||
Commercial, financial and agricultural
|
$
|
202,930
|
$
|
430,374
|
$
|
825,332
|
$
|
1,458,636
|
||||||||
Real estate – construction
|
36,556
|
0
|
0
|
36,556
|
||||||||||||
Total
|
$
|
239,486
|
$
|
430,374
|
$
|
825,332
|
$
|
1,495,192
|
||||||||
Fixed interest rates
|
$
|
47,637
|
$
|
194,156
|
$
|
138,455
|
$
|
380,248
|
||||||||
Floating or adjustable interest rates
|
191,849
|
236,218
|
686,877
|
1,114,944
|
||||||||||||
Total
|
$
|
239,486
|
$
|
430,374
|
$
|
825,332
|
$
|
1,495,192
|
(1) Scheduled repayments are reported in the maturity category in which the payment is due. |
(000's omitted)
|
2016
|
2015
|
2014
|
2013
|
2012
|
|||||||||||||||
Nonaccrual loans
|
||||||||||||||||||||
Consumer mortgage
|
$
|
13,684
|
$
|
12,790
|
$
|
15,323
|
$
|
12,560
|
$
|
11,286
|
||||||||||
Business lending
|
5,063
|
6,567
|
2,780
|
4,555
|
13,691
|
|||||||||||||||
Consumer indirect
|
0
|
0
|
10
|
14
|
0
|
|||||||||||||||
Consumer direct
|
0
|
15
|
20
|
4
|
8
|
|||||||||||||||
Home equity
|
1,872
|
2,356
|
2,598
|
2,340
|
1,375
|
|||||||||||||||
Total nonaccrual loans
|
20,619
|
21,728
|
20,731
|
19,473
|
26,360
|
|||||||||||||||
Accruing loans 90+ days delinquent
|
||||||||||||||||||||
Consumer mortgage
|
1,385
|
1,805
|
2,397
|
1,338
|
1,818
|
|||||||||||||||
Business lending
|
145
|
126
|
350
|
164
|
247
|
|||||||||||||||
Consumer indirect
|
169
|
102
|
82
|
755
|
73
|
|||||||||||||||
Consumer direct
|
58
|
51
|
36
|
117
|
71
|
|||||||||||||||
Home equity
|
1,319
|
111
|
241
|
181
|
539
|
|||||||||||||||
Total accruing loans 90+ days delinquent
|
3,076
|
2,195
|
3,106
|
2,555
|
2,748
|
|||||||||||||||
Nonperforming loans
|
||||||||||||||||||||
Consumer mortgage
|
15,069
|
14,595
|
17,720
|
13,898
|
13,104
|
|||||||||||||||
Business lending
|
5,208
|
6,693
|
3,130
|
4,719
|
13,938
|
|||||||||||||||
Consumer indirect
|
169
|
102
|
92
|
769
|
73
|
|||||||||||||||
Consumer direct
|
58
|
66
|
56
|
121
|
79
|
|||||||||||||||
Home equity
|
3,191
|
2,467
|
2,839
|
2,521
|
1,914
|
|||||||||||||||
Total nonperforming loans
|
23,695
|
23,923
|
23,837
|
22,028
|
29,108
|
|||||||||||||||
Other real estate (OREO)
|
1,966
|
2,088
|
1,855
|
5,060
|
4,788
|
|||||||||||||||
Total nonperforming assets
|
$
|
25,661
|
$
|
26,011
|
$
|
25,692
|
$
|
27,088
|
$
|
33,896
|
||||||||||
|
||||||||||||||||||||
Nonperforming loans / total loans
|
0.48
|
%
|
0.50
|
%
|
0.56
|
%
|
0.54
|
%
|
0.75
|
%
|
||||||||||
Legacy nonperforming loans / legacy total loans (1)
|
0.42
|
%
|
0.49
|
%
|
0.52
|
%
|
0.49
|
%
|
0.71
|
%
|
||||||||||
Nonperforming assets / total loans and other real estate
|
0.52
|
%
|
0.54
|
%
|
0.61
|
%
|
0.66
|
%
|
0.88
|
%
|
||||||||||
Delinquent loans (30 days old to nonaccruing) to total loans
|
1.19
|
%
|
1.16
|
%
|
1.46
|
%
|
1.49
|
%
|
1.92
|
%
|
||||||||||
Loan loss provision to net charge-offs
|
129
|
%
|
101
|
%
|
117
|
%
|
122
|
%
|
108
|
%
|
||||||||||
Legacy loan loss provision to net charge-offs (1)
|
130
|
%
|
86
|
%
|
125
|
%
|
134
|
%
|
116
|
%
|
||||||||||
(1)Legacy loans exclude loans acquired after January 1, 2009.
|
Years Ended December 31,
|
||||||||||||||||||||
(000's omitted except for ratios)
|
2016
|
2015
|
2014
|
2013
|
2012
|
|||||||||||||||
|
||||||||||||||||||||
Allowance for loan losses at beginning of period
|
$
|
45,401
|
$
|
45,341
|
$
|
44,319
|
$
|
42,888
|
$
|
42,213
|
||||||||||
Charge-offs:
|
||||||||||||||||||||
Consumer mortgage
|
647
|
1,374
|
1,075
|
1,012
|
1,004
|
|||||||||||||||
Business lending
|
1,969
|
2,249
|
1,596
|
3,671
|
5,654
|
|||||||||||||||
Consumer indirect
|
7,643
|
6,714
|
6,784
|
4,544
|
5,407
|
|||||||||||||||
Consumer direct
|
1,706
|
1,490
|
1,595
|
1,954
|
1,694
|
|||||||||||||||
Home equity
|
218
|
244
|
765
|
650
|
423
|
|||||||||||||||
Total charge-offs
|
12,183
|
12,071
|
11,815
|
11,831
|
14,182
|
|||||||||||||||
Recoveries:
|
||||||||||||||||||||
Consumer mortgage
|
115
|
80
|
205
|
36
|
59
|
|||||||||||||||
Business lending
|
616
|
877
|
750
|
692
|
1,295
|
|||||||||||||||
Consumer indirect
|
4,168
|
3,943
|
3,773
|
3,488
|
3,551
|
|||||||||||||||
Consumer direct
|
901
|
722
|
846
|
1,034
|
821
|
|||||||||||||||
Home equity
|
139
|
62
|
85
|
20
|
23
|
|||||||||||||||
Total recoveries
|
5,939
|
5,684
|
5,659
|
5,270
|
5,749
|
|||||||||||||||
Net charge-offs
|
6,244
|
6,387
|
6,156
|
6,561
|
8,433
|
|||||||||||||||
Provision for loan losses
|
8,039
|
6,349
|
7,497
|
7,358
|
8,715
|
|||||||||||||||
Provision for acquired impaired loans
|
37
|
98
|
(319
|
)
|
634
|
393
|
||||||||||||||
Allowance for loan losses at end of period
|
$
|
47,233
|
$
|
45,401
|
$
|
45,341
|
$
|
44,319
|
$
|
42,888
|
||||||||||
Allowance for loan losses / total loans
|
0.95
|
%
|
0.95
|
%
|
1.07
|
%
|
1.08
|
%
|
1.11
|
%
|
||||||||||
Allowance for legacy loan losses / total legacy loans (1)
|
1.02
|
%
|
1.05
|
%
|
1.14
|
%
|
1.15
|
%
|
1.21
|
%
|
||||||||||
Allowance for loan losses / nonperforming loans
|
199
|
%
|
190
|
%
|
190
|
%
|
201
|
%
|
147
|
%
|
||||||||||
Allowance for legacy loans / nonperforming legacy loans (1)
|
245
|
%
|
212
|
%
|
221
|
%
|
234
|
%
|
171
|
%
|
||||||||||
Net charge-offs to average loans outstanding:
|
||||||||||||||||||||
Consumer mortgage
|
0.03
|
%
|
0.08
|
%
|
0.05
|
%
|
0.06
|
%
|
0.07
|
%
|
||||||||||
Business lending
|
0.09
|
%
|
0.11
|
%
|
0.07
|
%
|
0.24
|
%
|
0.36
|
%
|
||||||||||
Consumer indirect
|
0.35
|
%
|
0.33
|
%
|
0.38
|
%
|
0.16
|
%
|
0.31
|
%
|
||||||||||
Consumer direct
|
0.40
|
%
|
0.41
|
%
|
0.40
|
%
|
0.52
|
%
|
0.54
|
%
|
||||||||||
Home equity
|
0.02
|
%
|
0.05
|
%
|
0.20
|
%
|
0.18
|
%
|
0.12
|
%
|
||||||||||
Total loans
|
0.13
|
%
|
0.15
|
%
|
0.15
|
%
|
0.17
|
%
|
0.23
|
%
|
||||||||||
(1)Legacy loans exclude loans acquired after January 1, 2009.
|
2016
|
2015
|
2014
|
2013
|
2012
|
||||||||||||||||||||||||||||||||||||
(000's omitted except for ratios)
|
Allowance
|
Loan Mix
|
Allowance
|
Loan Mix
|
Allowance
|
Loan Mix
|
Allowance
|
Loan Mix
|
Allowance
|
Loan Mix
|
||||||||||||||||||||||||||||||
Consumer mortgage
|
$
|
10,094
|
36.8
|
%
|
$
|
10,198
|
36.8
|
%
|
$
|
10,286
|
38.1
|
%
|
$
|
8,994
|
38.5
|
%
|
$
|
7,070
|
37.5
|
%
|
||||||||||||||||||||
Business lending
|
17,220
|
30.0
|
%
|
15,749
|
31.0
|
%
|
15,787
|
29.7
|
%
|
17,507
|
30.5
|
%
|
18,013
|
31.6
|
%
|
|||||||||||||||||||||||||
Consumer indirect
|
13,782
|
21.1
|
%
|
12,422
|
19.5
|
%
|
11,544
|
19.7
|
%
|
10,248
|
18.0
|
%
|
9,606
|
16.7
|
%
|
|||||||||||||||||||||||||
Consumer direct
|
2,979
|
3.9
|
%
|
2,997
|
4.1
|
%
|
3,083
|
4.3
|
%
|
3,181
|
4.4
|
%
|
3,303
|
4.4
|
%
|
|||||||||||||||||||||||||
Home equity
|
2,399
|
8.1
|
%
|
2,666
|
8.4
|
%
|
2,701
|
8.1
|
%
|
1,830
|
8.4
|
%
|
1,451
|
9.4
|
%
|
|||||||||||||||||||||||||
Acquired impaired loans
|
108
|
0.1
|
%
|
168
|
0.2
|
%
|
173
|
0.1
|
%
|
530
|
0.2
|
%
|
779
|
0.4
|
%
|
|||||||||||||||||||||||||
Unallocated
|
651
|
1,201
|
1,767
|
2,029
|
2,666
|
|||||||||||||||||||||||||||||||||||
Total
|
$
|
47,233
|
100.0
|
%
|
$
|
45,401
|
100.0
|
%
|
$
|
45,341
|
100.0
|
%
|
$
|
44,319
|
100.0
|
%
|
$
|
42,888
|
100.0
|
%
|
2016
|
2015
|
2014
|
||||||||||||||||||||||
(000's omitted, except rates)
|
Average Balance
|
Average Rate Paid
|
Average Balance
|
Average Rate Paid
|
Average Balance
|
Average Rate Paid
|
||||||||||||||||||
Noninterest checking deposits
|
$
|
1,558,548
|
0.00
|
%
|
$
|
1,352,683
|
0.00
|
%
|
$
|
1,249,807
|
0.00
|
%
|
||||||||||||
Interest checking deposits
|
1,631,560
|
0.03
|
%
|
1,429,450
|
0.03
|
%
|
1,334,745
|
0.03
|
%
|
|||||||||||||||
Regular savings deposits
|
1,303,814
|
0.07
|
%
|
1,106,127
|
0.08
|
%
|
1,039,173
|
0.08
|
%
|
|||||||||||||||
Money market deposits
|
1,776,838
|
0.16
|
%
|
1,518,184
|
0.15
|
%
|
1,493,900
|
0.16
|
%
|
|||||||||||||||
Time deposits
|
750,944
|
0.43
|
%
|
737,734
|
0.46
|
%
|
845,035
|
0.54
|
%
|
|||||||||||||||
Total deposits
|
$
|
7,021,704
|
0.10
|
%
|
$
|
6,144,178
|
0.11
|
%
|
$
|
5,962,660
|
0.14
|
%
|
(000's omitted)
|
2016
|
2015
|
||||||
Less than three months
|
$
|
14,221
|
$
|
18,970
|
||||
Three months to six months
|
10,832
|
11,147
|
||||||
Six months to one year
|
17,089
|
17,212
|
||||||
Over one year
|
9,082
|
8,101
|
||||||
Total
|
$
|
51,224
|
$
|
55,430
|
(000's omitted, except rates)
|
2016
|
2015
|
2014
|
|||||||||
FHLB overnight advance
|
$
|
146,200
|
$
|
301,300
|
$
|
338,000
|
||||||
Subordinated debt held by unconsolidated subsidiary trusts
|
102,170
|
102,146
|
102,122
|
|||||||||
Balance at end of period
|
$
|
248,370
|
$
|
403,446
|
$
|
440,122
|
||||||
Daily average during the year
|
$
|
271,927
|
$
|
513,827
|
$
|
405,411
|
||||||
Maximum month-end balance
|
$
|
414,648
|
$
|
701,338
|
$
|
521,211
|
||||||
Weighted-average rate during the year
|
1.46
|
%
|
0.82
|
%
|
0.89
|
%
|
||||||
Weighted-average year-end rate
|
1.70
|
%
|
1.05
|
%
|
0.79
|
%
|
(000's omitted)
|
Maturing Within One Year or Less
|
Maturing After One Year but Within Three Years
|
Maturing After Three Years but Within Five Years
|
Maturing After Five Years
|
Total
|
|||||||||||||||
FHLB overnight advance
|
$
|
146,200
|
$
|
0
|
$
|
0
|
$
|
0
|
$
|
146,200
|
||||||||||
Subordinated debt held by unconsolidated subsidiary trusts
|
0
|
0
|
0
|
102,527
|
102,527
|
|||||||||||||||
Interest on borrowings
|
3,159
|
6,294
|
6,294
|
44,159
|
59,906
|
|||||||||||||||
Operating leases
|
6,078
|
10,614
|
6,955
|
7,297
|
30,944
|
|||||||||||||||
Total
|
$
|
155,437
|
$
|
16,908
|
$
|
13,249
|
$
|
153,983
|
$
|
339,577
|
(000's omitted)
|
2016
|
2015
|
||||||
Commitments to extend credit
|
$
|
773,442
|
$
|
811,442
|
||||
Standby letters of credit
|
22,656
|
19,053
|
||||||
Total
|
$
|
796,098
|
$
|
830,495
|
2016
|
2015
|
2014
|
||||||||||||||||||||||
(000's omitted)
|
Amortized Cost/Book Value
|
Fair Value
|
Amortized Cost/Book Value
|
Fair Value
|
Amortized Cost/Book Value
|
Fair Value
|
||||||||||||||||||
Available-for-Sale Portfolio:
|
||||||||||||||||||||||||
U.S. Treasury and agency securities
|
$
|
1,876,358
|
$
|
1,902,762
|
$
|
1,866,819
|
$
|
1,899,978
|
$
|
1,479,134
|
$
|
1,517,733
|
||||||||||||
Obligations of state and political subdivisions
|
582,655
|
594,990
|
640,455
|
666,883
|
645,398
|
671,903
|
||||||||||||||||||
Government agency mortgage-backed securities
|
232,657
|
235,230
|
205,220
|
210,865
|
228,971
|
237,728
|
||||||||||||||||||
Corporate debt securities
|
5,716
|
5,687
|
16,672
|
16,680
|
26,803
|
27,091
|
||||||||||||||||||
Government agency collateralized mortgage obligations
|
9,225
|
9,535
|
12,862
|
13,308
|
17,330
|
18,025
|
||||||||||||||||||
Marketable equity securities
|
252
|
452
|
250
|
399
|
250
|
445
|
||||||||||||||||||
Total available-for-sale portfolio
|
2,706,863
|
2,748,656
|
2,742,278
|
2,808,113
|
2,397,886
|
2,472,925
|
||||||||||||||||||
Other Securities:
|
||||||||||||||||||||||||
FHLB common stock
|
12,191
|
12,191
|
19,317
|
19,317
|
19,553
|
19,553
|
||||||||||||||||||
Federal Reserve Bank common stock
|
19,781
|
19,781
|
16,050
|
16,050
|
16,050
|
16,050
|
||||||||||||||||||
Other equity securities
|
3,764
|
3,764
|
4,460
|
4,460
|
4,446
|
4,446
|
||||||||||||||||||
Total other securities
|
35,736
|
35,736
|
39,827
|
39,827
|
40,049
|
40,049
|
||||||||||||||||||
Total
|
$
|
2,742,599
|
$
|
2,784,392
|
$
|
2,782,105
|
$
|
2,847,940
|
$
|
2,437,935
|
$
|
2,512,974
|
(000's omitted, except rates)
|
Maturing Within One Year or Less
|
Maturing After One Year But Within Five Years
|
Maturing After Five Years But Within Ten Years
|
Maturing After Ten Years
|
Total Amortized Cost/Book Value
|
|||||||||||||||
Available-for-Sale Portfolio:
|
||||||||||||||||||||
U.S. Treasury and agency securities
|
$
|
0
|
$
|
768,791
|
$
|
1,107,567
|
$
|
0
|
$
|
1,876,358
|
||||||||||
Obligations of state and political subdivisions
|
34,986
|
151,935
|
194,589
|
201,145
|
582,655
|
|||||||||||||||
Government agency mortgage-backed securities (2)
|
4
|
842
|
27,744
|
204,067
|
232,657
|
|||||||||||||||
Corporate debt securities
|
3,008
|
2,708
|
0
|
0
|
5,716
|
|||||||||||||||
Government agency collateralized mortgage obligations (2)
|
0
|
17
|
986
|
8,222
|
9,225
|
|||||||||||||||
Available-for-sale portfolio
|
$
|
37,998
|
$
|
924,293
|
$
|
1,330,886
|
$
|
413,434
|
$
|
2,706,611
|
||||||||||
Weighted-average yield (1)
|
2.42
|
%
|
2.27
|
%
|
2.51
|
%
|
3.34
|
%
|
2.55
|
%
|
(1) Weighted-average yields are an arithmetic computation of income (not fully tax-equivalent adjusted) divided by book balance; they may differ from the yield to maturity, which considers the time value of money.
|
(2) Mortgage-backed securities and collateralized mortgage obligations are listed based on the contractual maturity. Actual maturities will differ from contractual maturities because borrowers may have the right to call or prepay certain obligations with or without penalties |
(000's omitted)
|
2016
|
2015
|
2014
|
2013
|
2012
|
|||||||||||||||
Income statement data
|
||||||||||||||||||||
Core operating expenses, revenues & Efficiency Ratio
|
||||||||||||||||||||
Noninterest expenses (GAAP)
|
$
|
266,848
|
$
|
233,055
|
$
|
226,580
|
$
|
221,255
|
$
|
211,757
|
||||||||||
Acquisition expenses
|
(1,706
|
)
|
(7,037
|
)
|
(123
|
)
|
(2,181
|
)
|
(5,747
|
)
|
||||||||||
Amortization of intangibles
|
(5,479
|
)
|
(3,663
|
)
|
(4,287
|
)
|
(4,469
|
)
|
(4,607
|
)
|
||||||||||
Litigation settlement
|
0
|
0
|
(2,800
|
)
|
0
|
(2,500
|
)
|
|||||||||||||
Core operating expenses (non-GAAP) - numerator
|
$
|
259,663
|
$
|
222,355
|
$
|
219,370
|
$
|
214,605
|
$
|
198,903
|
||||||||||
Tax-equivalent net interest income
|
283,857
|
260,824
|
259,961
|
253,154
|
247,330
|
|||||||||||||||
Noninterest revenues
|
155,625
|
123,299
|
119,020
|
102,180
|
99,246
|
|||||||||||||||
Insurance-related recovery
|
(950
|
)
|
0
|
0
|
0
|
0
|
||||||||||||||
Loss (Gain) on sale of investments & early retirement
of long-term borrowings, net
|
0
|
4
|
0
|
6,568
|
(291
|
)
|
||||||||||||||
Core operating revenues (non-GAAP) - denominator
|
$
|
438,532
|
$
|
384,127
|
$
|
378,981
|
$
|
361,902
|
$
|
346,285
|
||||||||||
Efficiency ratio (non-GAAP)
|
59.2
|
%
|
57.9
|
%
|
57.9
|
%
|
59.3
|
%
|
57.4
|
%
|
(000's omitted)
|
2016
|
2015
|
2014
|
2013
|
2012
|
|||||||||||||||
Balance sheet data
|
||||||||||||||||||||
Net tangible equity-to-assets ratio at period end
|
||||||||||||||||||||
Shareholders' equity (GAAP)
|
$
|
1,198,100
|
$
|
1,140,647
|
$
|
987,904
|
$
|
875,812
|
$
|
902,778
|
||||||||||
Intangible assets
|
(480,844
|
)
|
(484,146
|
)
|
(386,973
|
)
|
(390,499
|
)
|
(387,134
|
)
|
||||||||||
Deferred taxes on goodwill
|
43,504
|
39,724
|
35,842
|
32,339
|
27,947
|
|||||||||||||||
Tangible common equity (non-GAAP) - numerator
|
$
|
760,760
|
$
|
696,225
|
$
|
636,773
|
$
|
517,652
|
$
|
543,591
|
||||||||||
Total assets (GAAP)
|
$
|
8,666,437
|
$
|
8,552,669
|
$
|
7,489,440
|
$
|
7,095,864
|
$
|
7,496,800
|
||||||||||
Intangible assets
|
(480,844
|
)
|
(484,146
|
)
|
(386,973
|
)
|
(390,499
|
)
|
(387,134
|
)
|
||||||||||
Deferred taxes on goodwill
|
43,504
|
39,724
|
35,842
|
32,339
|
27,947
|
|||||||||||||||
Tangible assets (non-GAAP) - denominator
|
$
|
8,229,097
|
$
|
8,108,247
|
$
|
7,138,309
|
$
|
6,737,704
|
$
|
7,137,613
|
||||||||||
Net tangible equity-to-assets ratio at period end (non-GAAP)
|
9.24
|
%
|
8.59
|
%
|
8.92
|
%
|
7.68
|
%
|
7.62
|
%
|
||||||||||
·
|
Asset and liability levels using December 31, 2016 as a starting point.
|
·
|
There are assumed to be conservative levels of balance sheet growth, low-to-mid single digit growth in loans and deposits, while using the cash flows from investment contractual maturities and prepayments to repay short-term capital market borrowings or reinvest into securities or cash equivalents.
|
·
|
The prime rate and federal funds rates are assumed to move up over a 12-month period while moving the long end of the treasury curve to spreads over the three month treasury that are more consistent with historical norms (normalized yield curve). In the -50 basis point model, the prime and federal funds rates move lower in the first quarter of year one while moving the long end of the curve to levels over the three month treasury using spreads at a time when the yield curve was flat. Deposit rates are assumed to move in a manner that reflects the historical relationship between deposit rate movement and changes in the federal funds rate.
|
·
|
Cash flows are based on contractual maturity, optionality, and amortization schedules along with applicable prepayments derived from internal historical data and external sources.
|
Change in interest rates
|
Calculated annualized increase
(decrease) in projected net interest
income at December 31, 2016
|
||
+200 basis points
|
($3,294,000)
|
|
|
+100 basis points
|
($1,538,000)
|
|
|
-50 basis points
|
($2,699,000)
|
|
·
|
Consolidated Statements of Condition,
|
·
|
Consolidated Statements of Income,
|
·
|
Consolidated Statements of Comprehensive Income,
|
·
|
Consolidated Statements of Changes in Shareholders' Equity,
|
·
|
Consolidated Statements of Cash Flows,
|
·
|
Notes to Consolidated Financial Statements,
|
·
|
Management's Report on Internal Control Over Financial Reporting
|
·
|
Report of Independent Registered Public Accounting Firm
|
COMMUNITY BANK SYSTEM, INC.
|
||||||||
CONSOLIDATED STATEMENTS OF CONDITION
|
||||||||
(In Thousands, Except Share Data)
|
||||||||
December 31,
|
||||||||
|
2016
|
2015
|
||||||
Assets:
|
||||||||
Cash and cash equivalents
|
$
|
173,857
|
$
|
153,210
|
||||
Available-for-sale investment securities (cost of $2,706,863 and $2,742,278, respectively)
|
2,748,656
|
2,808,113
|
||||||
Other securities, at cost
|
35,736
|
39,827
|
||||||
Loans held for sale, at fair value
|
2,416
|
932
|
||||||
Loans
|
4,948,562
|
4,801,375
|
||||||
Allowance for loan losses
|
(47,233
|
)
|
(45,401
|
)
|
||||
Net loans
|
4,901,329
|
4,755,974
|
||||||
Goodwill
|
465,142
|
463,252
|
||||||
Core deposit intangibles, net
|
7,107
|
9,789
|
||||||
Other intangibles, net
|
8,595
|
11,105
|
||||||
Intangible assets, net
|
480,844
|
484,146
|
||||||
Premises and equipment, net
|
112,318
|
114,434
|
||||||
Accrued interest and fees receivable
|
31,093
|
25,904
|
||||||
Other assets
|
180,188
|
170,129
|
||||||
Total assets
|
$
|
8,666,437
|
$
|
8,552,669
|
||||
Liabilities:
|
||||||||
Noninterest-bearing deposits
|
$
|
1,646,039
|
$
|
1,499,616
|
||||
Interest-bearing deposits
|
5,429,915
|
5,373,858
|
||||||
Total deposits
|
7,075,954
|
6,873,474
|
||||||
Borrowings
|
146,200
|
301,300
|
||||||
Subordinated debt held by unconsolidated subsidiary trusts
|
102,170
|
102,146
|
||||||
Accrued interest and other liabilities
|
144,013
|
135,102
|
||||||
Total liabilities
|
7,468,337
|
7,412,022
|
||||||
Commitments and contingencies (See Note N)
|
||||||||
Shareholders' equity:
|
||||||||
Preferred stock, $1.00 par value, 500,000 shares authorized, 0 shares issued
|
0
|
0
|
||||||
Common stock, $1.00 par value, 75,000,000 shares authorized; 44,950,352 and
|
||||||||
44,442,568 shares issued, respectively
|
44,950
|
44,443
|
||||||
Additional paid-in capital
|
545,775
|
528,015
|
||||||
Retained earnings
|
614,692
|
566,591
|
||||||
Accumulated other comprehensive income
|
7,843
|
19,235
|
||||||
Treasury stock, at cost (512,937 and 667,708 shares, respectively)
|
(15,160
|
)
|
(17,637
|
)
|
||||
Total shareholders' equity
|
1,198,100
|
1,140,647
|
||||||
Total liabilities and shareholders' equity
|
$
|
8,666,437
|
$
|
8,552,669
|
CONSOLIDATED STATEMENTS OF INCOME
|
||||||||||||
(In Thousands, Except Per-Share Data)
|
||||||||||||
Years Ended December 31,
|
||||||||||||
|
2016
|
2015
|
2014
|
|||||||||
Interest income:
|
||||||||||||
Interest and fees on loans
|
$
|
211,467
|
$
|
187,743
|
$
|
185,527
|
||||||
Interest and dividends on taxable investments
|
56,201
|
52,871
|
50,247
|
|||||||||
Interest and dividends on nontaxable investments
|
17,519
|
19,008
|
20,446
|
|||||||||
Total interest income
|
285,187
|
259,622
|
256,220
|
|||||||||
Interest expense:
|
||||||||||||
Interest on deposits
|
7,325
|
6,971
|
8,191
|
|||||||||
Interest on borrowings
|
1,017
|
1,694
|
1,124
|
|||||||||
Interest on subordinated debt held by unconsolidated subsidiary trusts
|
2,949
|
2,537
|
2,477
|
|||||||||
Total interest expense
|
11,291
|
11,202
|
11,792
|
|||||||||
Net interest income
|
273,896
|
248,420
|
244,428
|
|||||||||
Provision for loan losses
|
8,076
|
6,447
|
7,178
|
|||||||||
Net interest income after provision for loan losses
|
265,820
|
241,973
|
237,250
|
|||||||||
Noninterest income:
|
||||||||||||
Deposit service fees
|
58,595
|
52,747
|
52,756
|
|||||||||
Other banking revenues
|
7,477
|
4,960
|
5,814
|
|||||||||
Employee benefit services
|
46,628
|
45,388
|
42,580
|
|||||||||
Insurance services
|
23,149
|
3,352
|
1,450
|
|||||||||
Wealth management services
|
19,776
|
16,856
|
16,420
|
|||||||||
Loss on sales of investment securities, net
|
0
|
(4
|
)
|
0
|
||||||||
Total noninterest income
|
155,625
|
123,299
|
119,020
|
|||||||||
Noninterest expenses:
|
||||||||||||
Salaries and employee benefits
|
151,647
|
126,356
|
123,077
|
|||||||||
Occupancy and equipment
|
30,078
|
27,593
|
27,948
|
|||||||||
Data processing and communications
|
34,501
|
30,430
|
29,294
|
|||||||||
Amortization of intangible assets
|
5,479
|
3,663
|
4,287
|
|||||||||
Legal and professional fees
|
8,455
|
6,813
|
7,247
|
|||||||||
Office supplies and postage
|
7,274
|
6,476
|
6,270
|
|||||||||
Business development and marketing
|
7,484
|
7,204
|
7,125
|
|||||||||
FDIC insurance premiums
|
3,671
|
3,962
|
3,899
|
|||||||||
Acquisition expenses
|
1,706
|
7,037
|
123
|
|||||||||
Other expenses
|
16,553
|
13,521
|
17,310
|
|||||||||
Total noninterest expenses
|
266,848
|
233,055
|
226,580
|
|||||||||
Income before income taxes
|
154,597
|
132,217
|
129,690
|
|||||||||
Income taxes
|
50,785
|
40,987
|
38,337
|
|||||||||
Net income
|
$
|
103,812
|
$
|
91,230
|
$
|
91,353
|
||||||
Basic earnings per share
|
$
|
2.34
|
$
|
2.21
|
$
|
2.24
|
||||||
Diluted earnings per share
|
$
|
2.32
|
$
|
2.19
|
$
|
2.22
|
||||||
Cash dividends declared per share
|
$
|
1.26
|
$
|
1.22
|
$
|
1.16
|
COMMUNITY BANK SYSTEM, INC.
|
||||||||||||
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
|
||||||||||||
(In Thousands)
|
||||||||||||
Years Ended December 31,
|
||||||||||||
|
2016
|
2015
|
2014
|
|||||||||
Pension and other post retirement obligations:
|
||||||||||||
Amortization of actuarial losses/(gains) included in net periodic pension cost, gross
|
$
|
5,514
|
$
|
(7,236
|
)
|
$
|
(13,904
|
)
|
||||
Tax effect
|
(2,108
|
)
|
2,774
|
5,374
|
||||||||
Amortization of actuarial losses/(gains) included in net periodic pension cost, net
|
3,406
|
(4,462
|
)
|
(8,530
|
)
|
|||||||
Amortization of prior service cost included in net periodic pension cost, gross
|
(136
|
)
|
(170
|
)
|
(1,698
|
)
|
||||||
Tax effect
|
52
|
65
|
657
|
|||||||||
Amortization of prior service cost included in net periodic pension cost, net
|
(84
|
)
|
(105
|
)
|
(1,041
|
)
|
||||||
Other comprehensive income/(loss) related to pension and other post retirement obligations, net of taxes
|
3,322
|
(4,567
|
)
|
(9,571
|
)
|
|||||||
Unrealized (losses)gains on securities:
|
||||||||||||
Net unrealized holding (losses)/gains arising during period, gross
|
(24,042
|
)
|
(9,209
|
)
|
106,040
|
|||||||
Tax effect
|
9,328
|
2,289
|
(39,203
|
)
|
||||||||
Net unrealized holding (losses)/gains arising during period, net
|
(14,714
|
)
|
(6,920
|
)
|
66,837
|
|||||||
Reclassification adjustment for net losses included in net income, gross
|
0
|
4
|
0
|
|||||||||
Tax effect
|
0
|
(2
|
)
|
0
|
||||||||
Reclassification adjustment for net losses included in net income, net
|
0
|
2
|
0
|
|||||||||
Other comprehensive (loss)/income related to unrealized (losses)/gains on
available-for-sale securities, net of taxes
|
(14,714
|
)
|
(6,918
|
)
|
66,837
|
|||||||
Other comprehensive (loss)/income, net of tax
|
(11,392
|
)
|
(11,485
|
)
|
57,266
|
|||||||
Net income
|
103,812
|
91,230
|
91,353
|
|||||||||
Comprehensive income
|
$
|
92,420
|
$
|
79,745
|
$
|
148,619
|
||||||
As of December 31,
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
Accumulated Other Comprehensive Income By Component:
|
||||||||||||
Unrealized loss for pension and other postretirement obligations
|
$
|
(28,969
|
)
|
$
|
(34,347
|
)
|
$
|
(26,941
|
)
|
|||
Tax effect
|
11,008
|
13,064
|
10,225
|
|||||||||
Net unrealized loss for pension and other postretirement obligations
|
(17,961
|
)
|
(21,283
|
)
|
(16,716
|
)
|
||||||
Unrealized gain on available-for-sale securities
|
41,793
|
65,835
|
75,039
|
|||||||||
Tax effect
|
(15,989
|
)
|
(25,317
|
)
|
(27,603
|
)
|
||||||
Net unrealized gain on available-for-sale securities
|
25,804
|
40,518
|
47,436
|
|||||||||
Accumulated other comprehensive income
|
$
|
7,843
|
$
|
19,235
|
$
|
30,720
|
COMMUNITY BANK SYSTEM, INC. | ||||||||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY | ||||||||||||||||||||||||||||
Years ended December 31, 2014, 2015 and 2016 | ||||||||||||||||||||||||||||
(In Thousands, Except Share Data) | ||||||||||||||||||||||||||||
Common Stock
|
Additional Paid-in Capital
|
Accumulated | ||||||||||||||||||||||||||
Shares Outstanding
|
Amount Issued
|
Retained Earnings
|
Other Comprehensive (Loss)/Income
|
Treasury Stock
|
Total
|
|||||||||||||||||||||||
Balance at December 31, 2013
|
40,431,318
|
$
|
41,213
|
$
|
396,528
|
$
|
481,732
|
$
|
(26,546
|
)
|
$
|
(17,115
|
)
|
$
|
875,812
|
|||||||||||||
Net income
|
91,353
|
91,353
|
||||||||||||||||||||||||||
Other comprehensive income, net of tax
|
57,266
|
57,266
|
||||||||||||||||||||||||||
Dividends declared:
|
||||||||||||||||||||||||||||
Common, $1.16 per share
|
(47,100
|
)
|
(47,100
|
)
|
||||||||||||||||||||||||
Common stock issued under
employee stock plan,
including tax benefits of $2,068
|
399,013
|
393
|
8,891
|
133
|
9,417
|
|||||||||||||||||||||||
Stock-based compensation
|
3,993
|
3,993
|
||||||||||||||||||||||||||
Treasury stock purchased
|
(123,000
|
)
|
(4,368
|
)
|
(4,368
|
)
|
||||||||||||||||||||||
Treasury stock issued to benefit plan
|
40,390
|
572
|
959
|
1,531
|
||||||||||||||||||||||||
Balance at December 31, 2014
|
40,747,721
|
41,606
|
409,984
|
525,985
|
30,720
|
(20,391
|
)
|
987,904
|
||||||||||||||||||||
Net income
|
91,230
|
91,230
|
||||||||||||||||||||||||||
Other comprehensive loss, net of tax
|
(11,485
|
)
|
(11,485
|
)
|
||||||||||||||||||||||||
Dividends declared:
|
||||||||||||||||||||||||||||
Common, $1.22 per share
|
(50,624
|
)
|
(50,624
|
)
|
||||||||||||||||||||||||
Common stock issued under
employee stock plan,
including tax benefits of $2,297
|
458,817
|
459
|
9,315
|
9,774
|
||||||||||||||||||||||||
Stock-based compensation
|
4,201
|
4,201
|
||||||||||||||||||||||||||
Stock issued for acquisition
|
2,377,329
|
2,378
|
99,824
|
102,202
|
||||||||||||||||||||||||
Treasury stock purchased
|
(265,230
|
)
|
(9,126
|
)
|
(9,126
|
)
|
||||||||||||||||||||||
Treasury stock issued to benefit plan
|
456,223
|
4,691
|
11,880
|
16,571
|
||||||||||||||||||||||||
Balance at December 31, 2015
|
43,774,860
|
44,443
|
528,015
|
566,591
|
19,235
|
(17,637
|
)
|
1,140,647
|
||||||||||||||||||||
Net income
|
103,812
|
103,812
|
||||||||||||||||||||||||||
Other comprehensive loss, net of tax
|
(11,392
|
)
|
(11,392
|
)
|
||||||||||||||||||||||||
Dividends declared:
|
||||||||||||||||||||||||||||
Common, $1.26 per share
|
(55,711
|
)
|
(55,711
|
)
|
||||||||||||||||||||||||
Common stock issued under
employee stock plan,
including tax benefits of $3,091
|
507,784
|
507
|
10,036
|
10,543
|
||||||||||||||||||||||||
Stock-based compensation
|
4,783
|
4,783
|
||||||||||||||||||||||||||
Treasury stock purchased
|
(67,826
|
)
|
(3,470
|
)
|
(3,470
|
)
|
||||||||||||||||||||||
Treasury stock issued to benefit plan
|
222,597
|
2,941
|
5,947
|
8,888
|
||||||||||||||||||||||||
Balance at December 31, 2016
|
44,437,415
|
$
|
44,950
|
$
|
545,775
|
$
|
614,692
|
$
|
7,843
|
$
|
(15,160
|
)
|
$
|
1,198,100
|
COMMUNITY BANK SYSTEM, INC.
|
||||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
||||||||||||
(In Thousands of Dollars)
|
Years Ended December 31,
|
|||||||||||
|
2016
|
2015
|
2014
|
|||||||||
Operating activities:
|
||||||||||||
Net income
|
$
|
103,812
|
$
|
91,230
|
$
|
91,353
|
||||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||||||
Depreciation
|
14,398
|
13,132
|
13,082
|
|||||||||
Amortization of intangible assets
|
5,479
|
3,663
|
4,287
|
|||||||||
Net (accretion)/amortization on securities, loans and borrowings
|
(4,405
|
)
|
(3,289
|
)
|
(3,533
|
)
|
||||||
Stock-based compensation
|
4,783
|
4,201
|
3,993
|
|||||||||
Provision for loan losses
|
8,076
|
6,447
|
7,178
|
|||||||||
Provision for deferred income taxes
|
13,066
|
10,716
|
7,461
|
|||||||||
Amortization of mortgage servicing rights
|
518
|
409
|
444
|
|||||||||
Income from bank-owned life insurance policies
|
(1,505
|
)
|
(1,086
|
)
|
(1,037
|
)
|
||||||
Loss on sales of investment securities, net
|
0
|
4
|
0
|
|||||||||
Net gain on sale of loans and other assets
|
(837
|
)
|
(180
|
)
|
(154
|
)
|
||||||
Change in other assets and liabilities
|
(12,124
|
)
|
(8,784
|
)
|
(970
|
)
|
||||||
Net cash provided by operating activities
|
131,261
|
116,463
|
122,104
|
|||||||||
Investing activities:
|
||||||||||||
Proceeds from sales of available-for-sale investment securities
|
0
|
221,136
|
0
|
|||||||||
Proceeds from maturities of available-for-sale investment securities
|
109,638
|
169,562
|
137,282
|
|||||||||
Proceeds from maturities of other securities
|
8,703
|
1,790
|
13
|
|||||||||
Purchases of available-for-sale investment securities
|
(65,966
|
)
|
(503,000
|
)
|
(310,517
|
)
|
||||||
Purchases of other securities
|
(4,612
|
)
|
0
|
(7,500
|
)
|
|||||||
Net change in loans
|
(159,871
|
)
|
(176,754
|
)
|
(137,207
|
)
|
||||||
Cash received/(paid) for acquisitions, net of cash acquired of $0, $81,772, and $0, respectively
|
(575
|
)
|
25,505
|
(924
|
)
|
|||||||
Settlement of bank owned life insurance policies
|
3,127
|
0
|
1,097
|
|||||||||
Purchases of premises and equipment, net
|
(12,442
|
)
|
(12,400
|
)
|
(13,376
|
)
|
||||||
Net cash used in investing activities
|
(121,998
|
)
|
(274,161
|
)
|
(331,132
|
)
|
||||||
Financing activities:
|
||||||||||||
Net change in deposits
|
202,480
|
238,969
|
39,220
|
|||||||||
Net change in borrowings, net of payments of $0, $0 and $13
|
(155,100
|
)
|
(36,700
|
)
|
196,087
|
|||||||
Issuance of common stock
|
10,543
|
9,774
|
9,417
|
|||||||||
Purchase of treasury stock
|
(3,470
|
)
|
(9,126
|
)
|
(4,368
|
)
|
||||||
Sale of treasury stock
|
8,888
|
16,571
|
1,531
|
|||||||||
Cash dividends paid
|
(55,048
|
)
|
(49,273
|
)
|
(46,178
|
)
|
||||||
Tax benefits from share-based payment arrangements
|
3,091
|
2,297
|
2,068
|
|||||||||
Net cash provided by financing activities
|
11,384
|
172,512
|
197,777
|
|||||||||
Change in cash and cash equivalents
|
20,647
|
14,814
|
(11,251
|
)
|
||||||||
Cash and cash equivalents at beginning of year
|
153,210
|
138,396
|
149,647
|
|||||||||
Cash and cash equivalents at end of year
|
$
|
173,857
|
$
|
153,210
|
$
|
138,396
|
||||||
Supplemental disclosures of cash flow information:
|
||||||||||||
Cash paid for interest
|
$
|
11,268
|
$
|
11,252
|
$
|
11,937
|
||||||
Cash paid for income taxes
|
32,239
|
28,891
|
29,457
|
|||||||||
Supplemental disclosures of noncash financing and investing activities:
|
||||||||||||
Dividends declared and unpaid
|
14,268
|
13,605
|
12,254
|
|||||||||
Transfers from loans to other real estate
|
2,612
|
3,943
|
2,546
|
|||||||||
Acquisitions:
|
||||||||||||
Common stock issued
|
0
|
102,202
|
0
|
|||||||||
Fair value of assets acquired, excluding acquired cash and intangibles
|
0
|
675,025
|
64
|
|||||||||
Fair value of liabilities assumed
|
0
|
700,574
|
0
|
·
|
Business lending loans are generally charged-off to the extent outstanding principal exceeds the fair value of estimated proceeds from collection efforts, including liquidation of collateral. The charge-off is recognized when the loss becomes reasonably quantifiable.
|
·
|
Consumer installment loans are generally charged-off to the extent outstanding principal balance exceeds the fair value of collateral, and are recognized by the end of the month in which the loan becomes 90 days past due.
|
·
|
Consumer mortgage and home equity loans are generally charged-off to the extent outstanding principal exceeds the fair value of the property, less estimated costs to sell, and are recognized when the loan becomes 180 days past due.
|
(000s omitted)
|
2016
|
2015
|
2014
|
|||||||||
Consideration paid:
|
||||||||||||
Cash
|
$
|
575
|
$
|
56,266
|
$
|
924
|
||||||
Community Bank System, Inc. common stock
|
0
|
102,202
|
0
|
|||||||||
Total net consideration paid
|
575
|
158,468
|
924
|
|||||||||
Recognized amounts of identifiable assets
acquired and liabilities assumed:
|
||||||||||||
Cash and cash equivalents
|
0
|
81,772
|
0
|
|||||||||
Investment securities
|
0
|
225,729
|
0
|
|||||||||
Loans
|
0
|
399,422
|
0
|
|||||||||
Premises and equipment
|
0
|
22,212
|
0
|
|||||||||
Accrued interest receivable
|
0
|
1,133
|
0
|
|||||||||
Other assets
|
0
|
26,529
|
163
|
|||||||||
Core deposit intangibles
|
0
|
2,570
|
0
|
|||||||||
Other intangibles
|
288
|
9,994
|
578
|
|||||||||
Deposits
|
0
|
(699,241
|
)
|
0
|
||||||||
Other liabilities
|
0
|
(1,333
|
)
|
0
|
||||||||
Total identifiable assets (liabilities), net
|
288
|
68,787
|
741
|
|||||||||
Goodwill
|
$
|
287
|
$
|
89,681
|
$
|
183
|
(000's omitted)
|
Acquired Impaired Loans
|
Acquired
Non-Impaired Loans
|
Total
Acquired
Loans
|
|||||||||
Contractually required principal and interest at acquisition
|
$
|
5,138
|
$
|
484,937
|
$
|
490,075
|
||||||
Contractual cash flows not expected to be collected
|
(1,977
|
)
|
(4,833
|
)
|
(6,810
|
)
|
||||||
Expected cash flows at acquisition
|
3,161
|
480,104
|
483,265
|
|||||||||
Interest component of expected cash flows
|
(341
|
)
|
(83,502
|
)
|
(83,843
|
)
|
||||||
Fair value of acquired loans
|
$
|
2,820
|
$
|
396,602
|
$
|
399,422
|
Actual since Acquisition Through
|
Pro Forma (Unaudited)
Year Ended December 31,
|
|||||||||||
(000's omitted)
|
December 31, 2015
|
2015
|
2014
|
|||||||||
Total revenue, net of interest expense
|
$
|
3,667
|
$
|
426,541
|
$
|
416,713
|
||||||
Net income (loss)
|
(3,905
|
)
|
96,894
|
85,665
|
2016
|
2015
|
|||||||||||||||||||||||||||||||
(000's omitted)
|
Amortized Cost
|
Gross Unrealized Gains
|
Gross Unrealized Losses
|
Estimated Fair Value
|
Amortized Cost
|
Gross Unrealized Gains
|
Gross Unrealized Losses
|
Estimated Fair Value
|
||||||||||||||||||||||||
Available-for-Sale Portfolio:
|
||||||||||||||||||||||||||||||||
U.S. Treasury and agency securities
|
$
|
1,876,358
|
$
|
28,522
|
$
|
2,118
|
$
|
1,902,762
|
$
|
1,866,819
|
$
|
35,186
|
$
|
2,027
|
$
|
1,899,978
|
||||||||||||||||
Obligations of state and political subdivisions
|
582,655
|
13,389
|
1,054
|
594,990
|
640,455
|
26,487
|
59
|
666,883
|
||||||||||||||||||||||||
Government agency mortgage-backed securities
|
232,657
|
5,040
|
2,467
|
235,230
|
205,220
|
6,906
|
1,261
|
210,865
|
||||||||||||||||||||||||
Corporate debt securities
|
5,716
|
2
|
31
|
5,687
|
16,672
|
66
|
58
|
16,680
|
||||||||||||||||||||||||
Government agency collateralized mortgage obligations
|
9,225
|
310
|
0
|
9,535
|
12,862
|
446
|
0
|
13,308
|
||||||||||||||||||||||||
Marketable equity securities
|
252
|
200
|
0
|
452
|
250
|
163
|
14
|
399
|
||||||||||||||||||||||||
Total available-for-sale portfolio
|
$
|
2,706,863
|
$
|
47,463
|
$
|
5,670
|
$
|
2,748,656
|
$
|
2,742,278
|
$
|
69,254
|
$
|
3,419
|
$
|
2,808,113
|
||||||||||||||||
Other Securities:
|
||||||||||||||||||||||||||||||||
Federal Home Loan Bank common stock
|
$
|
12,191
|
$
|
12,191
|
$
|
19,317
|
$
|
19,317
|
||||||||||||||||||||||||
Federal Reserve Bank common stock
|
19,781
|
19,781
|
16,050
|
16,050
|
||||||||||||||||||||||||||||
Other equity securities
|
3,764
|
3,764
|
4,460
|
4,460
|
||||||||||||||||||||||||||||
Total other securities
|
$
|
35,736
|
$
|
35,736
|
$
|
39,827
|
$
|
39,827
|
Less than 12 Months
|
12 Months or Longer
|
Total
|
||||||||||||||||||||||||||||||||||
(000's omitted)
|
#
|
Fair Value
|
Gross Unrealized Losses
|
#
|
Fair Value
|
Gross Unrealized Losses
|
#
|
Fair Value
|
Gross Unrealized Losses
|
|||||||||||||||||||||||||||
Available-for-Sale Portfolio:
|
||||||||||||||||||||||||||||||||||||
U.S. Treasury and agency securities
|
13
|
$
|
449,242
|
$
|
2,118
|
0
|
$
|
0
|
$
|
0
|
13
|
$
|
449,242
|
$
|
2,118
|
|||||||||||||||||||||
Obligations of state and political subdivisions
|
197
|
102,106
|
1,054
|
0
|
0
|
0
|
197
|
102,106
|
1,054
|
|||||||||||||||||||||||||||
Government agency mortgage-backed securities
|
57
|
83,862
|
1,637
|
15
|
21,788
|
830
|
72
|
105,650
|
2,467
|
|||||||||||||||||||||||||||
Corporate debt securities
|
1
|
2,677
|
31
|
0
|
0
|
0
|
1
|
2,677
|
31
|
|||||||||||||||||||||||||||
Government agency collateralized mortgage obligations
|
0
|
0
|
0
|
2
|
2
|
0
|
2
|
2
|
0
|
|||||||||||||||||||||||||||
Total available-for-sale investment portfolio
|
268
|
$
|
637,887
|
$
|
4,840
|
17
|
$
|
21,790
|
$
|
830
|
285
|
$
|
659,677
|
$
|
5,670
|
Less than 12 Months
|
12 Months or Longer
|
Total
|
||||||||||||||||||||||||||||||||||
(000's omitted)
|
#
|
Fair Value
|
Gross Unrealized Losses
|
#
|
Fair Value
|
Gross Unrealized Losses
|
#
|
Fair Value
|
Gross Unrealized Losses
|
|||||||||||||||||||||||||||
Available-for-Sale Portfolio:
|
||||||||||||||||||||||||||||||||||||
U.S. Treasury and agency securities
|
9
|
$
|
353,844
|
$
|
2,027
|
0
|
$
|
0
|
$
|
0
|
9
|
$
|
353,844
|
$
|
2,027
|
|||||||||||||||||||||
Obligations of state and political subdivisions
|
18
|
8,804
|
34
|
2
|
735
|
25
|
20
|
9,539
|
59
|
|||||||||||||||||||||||||||
Government agency mortgage-backed securities
|
17
|
24,178
|
161
|
19
|
30,103
|
1,100
|
36
|
54,281
|
1,261
|
|||||||||||||||||||||||||||
Corporate debt securities
|
1
|
3,024
|
0
|
1
|
2,710
|
58
|
2
|
5,734
|
58
|
|||||||||||||||||||||||||||
Government agency collateralized mortgage obligations
|
0
|
0
|
0
|
2
|
3
|
0
|
2
|
3
|
0
|
|||||||||||||||||||||||||||
Marketable equity securities
|
1
|
87
|
14
|
0
|
0
|
0
|
1
|
87
|
14
|
|||||||||||||||||||||||||||
Total available-for-sale investment portfolio
|
46
|
$
|
389,937
|
$
|
2,236
|
24
|
$
|
33,551
|
$
|
1,183
|
70
|
$
|
423,488
|
$
|
3,419
|
Available-for-Sale
|
||||||||
(000's omitted)
|
Amortized Cost
|
Fair Value
|
||||||
Due in one year or less
|
$
|
37,994
|
$
|
38,212
|
||||
Due after one through five years
|
923,434
|
939,357
|
||||||
Due after five years through ten years
|
1,302,156
|
1,319,913
|
||||||
Due after ten years
|
201,145
|
205,957
|
||||||
Subtotal
|
2,464,729
|
2,503,439
|
||||||
Government agency mortgage-backed securities
|
232,657
|
235,230
|
||||||
Government agency collateralized mortgage obligations
|
9,225
|
9,535
|
||||||
Total
|
$
|
2,706,611
|
$
|
2,748,204
|
(000's omitted)
|
2016
|
2015
|
2014
|
|||||||||
Gross gains on sales of investment securities
|
$
|
0
|
$
|
3
|
$
|
0
|
||||||
Gross losses on sales of investment securities
|
0
|
7
|
0
|
·
|
Consumer mortgages consist primarily of fixed rate residential instruments, typically 10 – 30 years in contractual term, secured by first liens on real property.
|
·
|
Business lending is comprised of general purpose commercial and industrial loans including, but not limited to agricultural-related and dealer floor plans, as well as mortgages on commercial property.
|
·
|
Consumer indirect consists primarily of installment loans originated through selected dealerships and are secured by automobiles, marine and other recreational vehicles.
|
·
|
Consumer direct consists of all other loans to consumers such as personal installment loans and lines of credit.
|
·
|
Home equity products are consumer purpose installment loans or lines of credit most often secured by a first or second lien position on residential real estate with terms up to 30 years.
|
(000's omitted)
|
2016
|
2015
|
||||||
Consumer mortgage
|
$
|
1,819,701
|
$
|
1,769,754
|
||||
Business lending
|
1,490,076
|
1,497,271
|
||||||
Consumer indirect
|
1,044,972
|
935,760
|
||||||
Consumer direct
|
191,815
|
195,076
|
||||||
Home equity
|
401,998
|
403,514
|
||||||
Gross loans, including deferred origination costs
|
4,948,562
|
4,801,375
|
||||||
Allowance for loan losses
|
(47,233
|
)
|
(45,401
|
)
|
||||
Loans, net of allowance for loan losses
|
$
|
4,901,329
|
$
|
4,755,974
|
(000's omitted)
|
2016
|
2015
|
||||||
Balance at beginning of year
|
$
|
11,337
|
$
|
8,928
|
||||
New loans
|
4,959
|
5,138
|
||||||
Payments
|
(5,346
|
)
|
(2,729
|
)
|
||||
Balance at end of year
|
$
|
10,950
|
$
|
11,337
|
(000's omitted)
|
2016
|
2015
|
||||||
Credit impaired acquired loans:
|
||||||||
Outstanding principal balance
|
$
|
6,354
|
$
|
8,339
|
||||
Carrying amount
|
5,553
|
7,299
|
||||||
Non-impaired acquired loans:
|
||||||||
Outstanding principal balance
|
497,308
|
620,942
|
||||||
Carrying amount
|
489,807
|
610,355
|
||||||
Total acquired loans:
|
||||||||
Outstanding principal balance
|
503,662
|
629,281
|
||||||
Carrying amount
|
495,360
|
617,654
|
(000's omitted)
|
2016
|
2015
|
||||||
Balance at beginning of year
|
$
|
810
|
$
|
705
|
||||
Oneida acquisition
|
0
|
341
|
||||||
Accretion recognized
|
(455
|
)
|
(552
|
)
|
||||
Net reclassification to accretable from nonaccretable
|
143
|
316
|
||||||
Balance at end of year
|
$
|
498
|
$
|
810
|
(000's omitted)
|
Past Due
30 - 89
days
|
90+ Days Past Due and
Still Accruing
|
Nonaccrual
|
Total
Past Due
|
Current
|
Total Loans
|
||||||||||||||||||
Consumer mortgage
|
$
|
11,379
|
$
|
1,180
|
$
|
11,352
|
$
|
23,911
|
$
|
1,635,849
|
$
|
1,659,760
|
||||||||||||
Business lending
|
3,921
|
145
|
3,811
|
7,877
|
1,269,789
|
1,277,666
|
||||||||||||||||||
Consumer indirect
|
13,883
|
166
|
0
|
14,049
|
1,000,776
|
1,014,825
|
||||||||||||||||||
Consumer direct
|
1,549
|
58
|
0
|
1,607
|
180,315
|
181,922
|
||||||||||||||||||
Home equity
|
1,250
|
414
|
1,437
|
3,101
|
315,928
|
319,029
|
||||||||||||||||||
Total
|
$
|
31,982
|
$
|
1,963
|
$
|
16,600
|
$
|
50,545
|
$
|
4,402,657
|
$
|
4,453,202
|
(000's omitted)
|
Past Due
30 - 89
days
|
90+ Days Past Due and
Still Accruing
|
Nonaccrual
|
Total
Past Due
|
Acquired Impaired(1)
|
Current
|
Total Loans
|
|||||||||||||||||||||
Consumer mortgage
|
$
|
1,539
|
$
|
205
|
$
|
2,332
|
$
|
4,076
|
$
|
0
|
$
|
155,865
|
$
|
159,941
|
||||||||||||||
Business lending
|
528
|
0
|
1,252
|
1,780
|
5,553
|
205,077
|
212,410
|
|||||||||||||||||||||
Consumer indirect
|
231
|
3
|
0
|
234
|
0
|
29,913
|
30,147
|
|||||||||||||||||||||
Consumer direct
|
231
|
0
|
0
|
231
|
0
|
9,662
|
9,893
|
|||||||||||||||||||||
Home equity
|
778
|
905
|
435
|
2,118
|
0
|
80,851
|
82,969
|
|||||||||||||||||||||
Total
|
$
|
3,307
|
$
|
1,113
|
$
|
4,019
|
$
|
8,439
|
$
|
5,553
|
$
|
481,368
|
$
|
495,360
|
(1) Acquired impaired loans were not classified as nonperforming assets as the loans are considered to be performing under ASC 310-30. As a result interest income, through the accretion of the difference between the carrying amount of the loans and the expected cashflows, is being recognized on all acquired impaired loans.
|
(000's omitted)
|
Past Due
30 - 89
days
|
90+ Days Past Due and
Still Accruing
|
Nonaccrual
|
Total
Past Due
|
Current
|
Total Loans
|
||||||||||||||||||
Consumer mortgage
|
$
|
10,482
|
$
|
1,411
|
$
|
11,394
|
$
|
23,287
|
$
|
1,558,171
|
$
|
1,581,458
|
||||||||||||
Business lending
|
4,442
|
126
|
5,381
|
9,949
|
1,223,679
|
1,233,628
|
||||||||||||||||||
Consumer indirect
|
11,575
|
102
|
0
|
11,677
|
878,662
|
890,339
|
||||||||||||||||||
Consumer direct
|
1,414
|
51
|
1
|
1,466
|
176,585
|
178,051
|
||||||||||||||||||
Home equity
|
1,093
|
111
|
2,029
|
3,233
|
297,012
|
300,245
|
||||||||||||||||||
Total
|
$
|
29,006
|
$
|
1,801
|
$
|
18,805
|
$
|
49,612
|
$
|
4,134,109
|
$
|
4,183,721
|
(000's omitted)
|
Past Due
30 - 89
days
|
90+ Days Past Due and
Still Accruing
|
Nonaccrual
|
Total
Past Due
|
Acquired Impaired(1)
|
Current
|
Total Loans
|
|||||||||||||||||||||
Consumer mortgage
|
$
|
1,373
|
$
|
394
|
$
|
1,396
|
$
|
3,163
|
$
|
0
|
$
|
185,133
|
$
|
188,296
|
||||||||||||||
Business lending
|
535
|
0
|
1,186
|
1,721
|
7,299
|
254,623
|
263,643
|
|||||||||||||||||||||
Consumer indirect
|
245
|
0
|
0
|
245
|
0
|
45,176
|
45,421
|
|||||||||||||||||||||
Consumer direct
|
140
|
0
|
14
|
154
|
0
|
16,871
|
17,025
|
|||||||||||||||||||||
Home equity
|
636
|
0
|
327
|
963
|
0
|
102,306
|
103,269
|
|||||||||||||||||||||
Total
|
$
|
2,929
|
$
|
394
|
$
|
2,923
|
$
|
6,246
|
$
|
7,299
|
$
|
604,109
|
$
|
617,654
|
(1) Acquired impaired loans were not classified as nonperforming assets as the loans are considered to be performing under ASC 310-30. As a result interest income, through the accretion of the difference between the carrying amount of the loans and the expected cashflows, is being recognized on all acquired impaired loans.
|
Pass
|
The condition of the borrower and the performance of the loans are satisfactory or better.
|
Special Mention | The condition of the borrower has deteriorated although the loan performs as agreed. |
Classified | The condition of the borrower has significantly deteriorated and the performance of the loan could further deteriorate if deficiencies are not corrected. |
Doubtful |
The condition of the borrower has deteriorated to the point that collection of the balance is improbable based on current facts and conditions.
|
December 31, 2016
|
December 31, 2015
|
|||||||||||||||||||||||
(000's omitted)
|
Legacy
|
Acquired
|
Total
|
Legacy
|
Acquired
|
Total
|
||||||||||||||||||
Pass
|
$
|
1,051,005
|
$
|
162,165
|
$
|
1,213,170
|
$
|
1,048,364
|
$
|
219,374
|
$
|
1,267,738
|
||||||||||||
Special mention
|
135,602
|
29,690
|
165,292
|
124,768
|
20,007
|
144,775
|
||||||||||||||||||
Classified
|
90,585
|
15,002
|
105,587
|
60,181
|
16,963
|
77,144
|
||||||||||||||||||
Doubtful
|
474
|
0
|
474
|
315
|
0
|
315
|
||||||||||||||||||
Acquired impaired
|
0
|
5,553
|
5,553
|
0
|
7,299
|
7,299
|
||||||||||||||||||
Total
|
$
|
1,277,666
|
$
|
212,410
|
$
|
1,490,076
|
$
|
1,233,628
|
$
|
263,643
|
$
|
1,497,271
|
(000's omitted)
|
Consumer
Mortgage
|
Consumer Indirect
|
Consumer Direct
|
Home Equity
|
Total
|
|||||||||||||||
Performing
|
$
|
1,647,228
|
$
|
1,014,659
|
$
|
181,864
|
$
|
317,178
|
$
|
3,160,929
|
||||||||||
Nonperforming
|
12,532
|
166
|
58
|
1,851
|
14,607
|
|||||||||||||||
Total
|
$
|
1,659,760
|
$
|
1,014,825
|
$
|
181,922
|
$
|
319,029
|
$
|
3,175,536
|
(000's omitted)
|
Consumer
Mortgage
|
Consumer Indirect
|
Consumer Direct
|
Home Equity
|
Total
|
|||||||||||||||
Performing
|
$
|
157,404
|
$
|
30,144
|
$
|
9,893
|
$
|
81,629
|
$
|
279,070
|
||||||||||
Nonperforming
|
2,537
|
3
|
0
|
1,340
|
3,880
|
|||||||||||||||
Total
|
$
|
159,941
|
$
|
30,147
|
$
|
9,893
|
$
|
82,969
|
$
|
282,950
|
(000's omitted)
|
Consumer
Mortgage
|
Consumer Indirect
|
Consumer Direct
|
Home Equity
|
Total
|
|||||||||||||||
Performing
|
$
|
1,568,653
|
$
|
890,237
|
$
|
177,999
|
$
|
298,105
|
$
|
2,934,994
|
||||||||||
Nonperforming
|
12,805
|
102
|
52
|
2,140
|
15,099
|
|||||||||||||||
Total
|
$
|
1,581,458
|
$
|
890,339
|
$
|
178,051
|
$
|
300,245
|
$
|
2,950,093
|
(000's omitted)
|
Consumer
Mortgage
|
Consumer Indirect
|
Consumer Direct
|
Home Equity
|
Total
|
|||||||||||||||
Performing
|
$
|
186,506
|
$
|
45,421
|
$
|
17,011
|
$
|
102,942
|
$
|
351,880
|
||||||||||
Nonperforming
|
1,790
|
0
|
14
|
327
|
2,131
|
|||||||||||||||
Total
|
$
|
188,296
|
$
|
45,421
|
$
|
17,025
|
$
|
103,269
|
$
|
354,011
|
(000's omitted)
|
2016
|
2015
|
||||||
Loans with allowance allocation
|
$
|
1,109
|
$
|
0
|
||||
Loans without allowance allocation
|
556
|
2,376
|
||||||
Carrying balance
|
1,665
|
2,376
|
||||||
Contractual balance
|
3,340
|
3,419
|
||||||
Specifically allocated allowance
|
477
|
0
|
||||||
Average impaired loans
|
4,683
|
2,922
|
||||||
Interest income recognized
|
0
|
0
|
December 31, 2016
|
December 31, 2015
|
|||||||||||||||||||||||||||||||||||||||||||||||
(000's omitted)
|
Nonaccrual
|
Accruing
|
Total
|
Nonaccrual
|
Accruing
|
Total
|
||||||||||||||||||||||||||||||||||||||||||
#
|
Amount
|
#
|
Amount
|
#
|
Amount
|
#
|
Amount
|
#
|
Amount
|
#
|
Amount
|
|||||||||||||||||||||||||||||||||||||
Consumer mortgage
|
36
|
$
|
1,520
|
45
|
$
|
1,956
|
81
|
$
|
3,476
|
37
|
$
|
1,472
|
54
|
$
|
2,486
|
91
|
$
|
3,958
|
||||||||||||||||||||||||||||||
Business lending
|
6
|
91
|
5
|
690
|
11
|
781
|
8
|
217
|
6
|
737
|
14
|
954
|
||||||||||||||||||||||||||||||||||||
Consumer indirect
|
0
|
0
|
78
|
771
|
78
|
771
|
0
|
0
|
77
|
691
|
77
|
691
|
||||||||||||||||||||||||||||||||||||
Consumer direct
|
0
|
0
|
23
|
65
|
23
|
65
|
0
|
0
|
32
|
37
|
32
|
37
|
||||||||||||||||||||||||||||||||||||
Home equity
|
14
|
221
|
7
|
216
|
21
|
437
|
10
|
203
|
14
|
301
|
24
|
504
|
||||||||||||||||||||||||||||||||||||
Total
|
56
|
$
|
1,832
|
158
|
$
|
3,698
|
214
|
$
|
5,530
|
55
|
$
|
1,892
|
183
|
$
|
4,252
|
238
|
$
|
6,144
|
December 31, 2016
|
December 31, 2015
|
|||||||||||||||
(000's omitted)
|
#
|
Amount
|
#
|
Amount
|
||||||||||||
Consumer mortgage
|
9
|
$
|
597
|
21
|
$
|
1,374
|
||||||||||
Business lending
|
0
|
0
|
3
|
67
|
||||||||||||
Consumer indirect
|
33
|
459
|
35
|
349
|
||||||||||||
Consumer direct
|
3
|
51
|
6
|
11
|
||||||||||||
Home equity
|
3
|
50
|
6
|
63
|
||||||||||||
Total
|
48
|
$
|
1,157
|
71
|
$
|
1,864
|
(000's omitted)
|
Consumer Mortgage
|
Business Lending
|
Consumer Indirect
|
Consumer Direct
|
Home Equity
|
Unallocated
|
Acquired Impaired
|
Total
|
||||||||||||||||||||||||
Balance at
December 31, 2014
|
$
|
10,286
|
$
|
15,787
|
$
|
11,544
|
$
|
3,083
|
$
|
2,701
|
$
|
1,767
|
$
|
173
|
$
|
45,341
|
||||||||||||||||
Charge-offs
|
(1,374
|
)
|
(2,146
|
)
|
(6,714
|
)
|
(1,490
|
)
|
(244
|
)
|
0
|
(103
|
)
|
(12,071
|
)
|
|||||||||||||||||
Recoveries
|
80
|
877
|
3,943
|
722
|
62
|
0
|
0
|
5,684
|
||||||||||||||||||||||||
Provision
|
1,206
|
1,231
|
3,649
|
682
|
147
|
(566
|
)
|
98
|
6,447
|
|||||||||||||||||||||||
Balance at
December 31, 2015
|
10,198
|
15,749
|
12,422
|
2,997
|
2,666
|
1,201
|
168
|
45,401
|
||||||||||||||||||||||||
Charge-offs
|
(647
|
)
|
(1,872
|
)
|
(7,643
|
)
|
(1,706
|
)
|
(218
|
)
|
0
|
(97
|
)
|
(12,183
|
)
|
|||||||||||||||||
Recoveries
|
115
|
616
|
4,168
|
901
|
139
|
0
|
0
|
5,939
|
||||||||||||||||||||||||
Provision
|
428
|
2,727
|
4,835
|
787
|
(188
|
)
|
(550
|
)
|
37
|
8,076
|
||||||||||||||||||||||
Balance at
December 31, 2016
|
$
|
10,094
|
$
|
17,220
|
$
|
13,782
|
$
|
2,979
|
$
|
2,399
|
$
|
651
|
$
|
108
|
$
|
47,233
|
(000's omitted)
|
2016
|
2015
|
||||||
Land and land improvements
|
$
|
22,585
|
$
|
22,191
|
||||
Bank premises
|
116,663
|
112,011
|
||||||
Equipment and construction in progress
|
80,527
|
80,684
|
||||||
Premises and equipment, gross
|
219,775
|
214,886
|
||||||
Accumulated depreciation
|
(107,457
|
)
|
(100,452
|
)
|
||||
Premises and equipment, net
|
$
|
112,318
|
$
|
114,434
|
December 31, 2016
|
December 31, 2015
|
|||||||||||||||||||||||
(000's omitted)
|
Gross Carrying Amount
|
Accumulated Amortization
|
Net Carrying Amount
|
Gross Carrying Amount
|
Accumulated Amortization
|
Net Carrying Amount
|
||||||||||||||||||
Amortizing intangible assets:
|
||||||||||||||||||||||||
Core deposit intangibles
|
$
|
39,688
|
$
|
(32,581
|
)
|
$
|
7,107
|
$
|
39,688
|
$
|
(29,899
|
)
|
$
|
9,789
|
||||||||||
Other intangibles
|
17,853
|
(9,258
|
)
|
8,595
|
17,565
|
(6,460
|
)
|
11,105
|
||||||||||||||||
Total amortizing intangibles
|
$
|
57,541
|
$
|
(41,839
|
)
|
$
|
15,702
|
$
|
57,253
|
$
|
(36,359
|
)
|
$
|
20,894
|
2017
|
$
|
4,413
|
||
2018
|
3,566
|
|||
2019
|
2,782
|
|||
2020
|
2,119
|
|||
2021
|
1,531
|
|||
Thereafter
|
1,291
|
|||
Total
|
$
|
15,702
|
(000's omitted)
|
Year Ended December 31, 2014
|
Activity
|
Year Ended December 31, 2015
|
Activity
|
Year Ended December 31, 2016
|
|||||||||||||||
Goodwill
|
$
|
379,998
|
$
|
88,078
|
$
|
468,076
|
$
|
1,890
|
$
|
469,966
|
||||||||||
Accumulated impairment
|
(4,824
|
)
|
0
|
(4,824
|
)
|
0
|
(4,824
|
)
|
||||||||||||
Goodwill, net
|
$
|
375,174
|
$
|
88,078
|
$
|
463,252
|
$
|
1,890
|
$
|
465,142
|
(000's omitted)
|
2016
|
2015
|
||||||
Carrying value before valuation allowance at beginning of period
|
$
|
1,472
|
$
|
1,089
|
||||
Additions
|
481
|
403
|
||||||
Oneida acquisition
|
0
|
389
|
||||||
Amortization
|
(518
|
)
|
(409
|
)
|
||||
Carrying value before valuation allowance at end of period
|
1,435
|
1,472
|
||||||
Valuation allowance balance at beginning of period
|
0
|
0
|
||||||
Impairment charges
|
(226
|
)
|
(133
|
)
|
||||
Impairment recoveries
|
226
|
133
|
||||||
Valuation allowance balance at end of period
|
0
|
0
|
||||||
Net carrying value at end of period
|
$
|
1,435
|
$
|
1,472
|
||||
Fair value of MSRs at end of period
|
$
|
1,928
|
$
|
1,962
|
||||
Principal balance of loans sold during the year
|
$
|
45,852
|
$
|
35,491
|
||||
Principal balance of loans serviced for others
|
$
|
365,374
|
$
|
377,909
|
||||
Custodial escrow balances maintained in connection with loans serviced for others
|
$
|
5,603
|
$
|
5,700
|
2016
|
2015
|
|
Weighted-average contractual life (in years)
|
20.8
|
19.9
|
Weighted-average constant prepayment rate (CPR)
|
15.1%
|
14.9%
|
Weighted-average discount rate
|
3.5%
|
3.3%
|
(000's omitted)
|
2016
|
2015
|
||||||
Noninterest checking
|
$
|
1,646,039
|
$
|
1,499,616
|
||||
Interest checking
|
1,644,029
|
1,575,379
|
||||||
Savings
|
1,303,851
|
1,255,027
|
||||||
Money market
|
1,778,907
|
1,738,904
|
||||||
Time
|
703,128
|
804,548
|
||||||
Total deposits
|
$
|
7,075,954
|
$
|
6,873,474
|
(000's omitted)
|
All Accounts
|
Accounts $250,000
or Greater
|
||||||
2017
|
$
|
492,000
|
$
|
42,142
|
||||
2018
|
103,698
|
1,713
|
||||||
2019
|
48,096
|
2,337
|
||||||
2020
|
32,774
|
2,717
|
||||||
2021
|
26,208
|
2,315
|
||||||
Thereafter
|
352
|
0
|
||||||
Total
|
$
|
703,128
|
$
|
51,224
|
(000's omitted)
|
2016
|
2015
|
||||||
FHLB overnight advance
|
$
|
146,200
|
$
|
301,300
|
||||
Subordinated debt held by unconsolidated subsidiary trusts,
|
||||||||
net of discount of $357 and $381, respectively
|
102,170
|
102,146
|
||||||
Total borrowings
|
$
|
248,370
|
$
|
403,446
|
(000's omitted, except rate)
|
Carrying Value
|
Weighted-average Rate at
December 31, 2016
|
||||||
January 3, 2017
|
$
|
146,200
|
0.74
|
%
|
||||
July 31, 2031
|
24,850
|
4.47
|
%
|
|||||
December 15, 2036
|
77,320
|
2.61
|
%
|
|||||
Total
|
$
|
248,370
|
1.70
|
%
|
Trust
|
Issuance Date
|
Par Amount
|
Interest Rate
|
Maturity Date
|
Call Price
|
III
|
7/31/2001
|
$24.5 million
|
3 month LIBOR plus 3.58% (4.47%)
|
7/31/2031
|
Par
|
IV
|
12/8/2006
|
$75 million
|
3 month LIBOR plus 1.65% (2.61%)
|
12/15/2036
|
Par
|
(000's omitted)
|
2016
|
2015
|
2014
|
|||||||||
Current:
|
||||||||||||
Federal
|
$
|
32,829
|
$
|
27,663
|
$
|
30,006
|
||||||
State and other
|
4,890
|
2,608
|
870
|
|||||||||
Deferred:
|
||||||||||||
Federal
|
11,444
|
9,604
|
6,867
|
|||||||||
State and other
|
1,622
|
1,112
|
594
|
|||||||||
Provision for income taxes
|
$
|
50,785
|
$
|
40,987
|
$
|
38,337
|
(000's omitted)
|
2016
|
2015
|
||||||
Allowance for loan losses
|
$
|
18,366
|
$
|
17,791
|
||||
Employee benefits
|
6,311
|
6,633
|
||||||
Debt extinguishment
|
299
|
613
|
||||||
Other, net
|
5,202
|
9,704
|
||||||
Deferred tax asset
|
30,178
|
34,741
|
||||||
Investment securities
|
32,839
|
38,314
|
||||||
Tax-deductible goodwill
|
43,504
|
39,724
|
||||||
Loan origination costs
|
8,228
|
7,295
|
||||||
Depreciation
|
71
|
886
|
||||||
Mortgage servicing rights
|
548
|
565
|
||||||
Pension
|
18,194
|
14,807
|
||||||
Deferred tax liability
|
103,384
|
101,591
|
||||||
Net deferred tax liability
|
$
|
(73,206
|
)
|
$
|
(66,850
|
)
|
|
2016
|
2015
|
2014
|
Federal statutory income tax rate
|
35.0%
|
35.0%
|
35.0%
|
Increase (reduction) in taxes resulting from:
|
|||
Tax-exempt interest
|
(4.0)
|
(5.0)
|
(5.4)
|
State income taxes, net of federal benefit
|
2.7
|
1.8
|
0.7
|
Other
|
(0.9)
|
(0.8)
|
(0.7)
|
Effective income tax rate
|
32.8%
|
31.0%
|
29.6%
|
(000's omitted)
|
2016
|
2015
|
2014
|
|||||||||
Unrecognized tax benefits at beginning of year
|
$
|
127
|
$
|
162
|
$
|
138
|
||||||
Changes related to:
|
||||||||||||
Positions taken during the current year
|
0
|
0
|
24
|
|||||||||
Lapse of statutes of limitations
|
(35
|
)
|
(35
|
)
|
0
|
|||||||
Unrecognized tax benefits at end of year
|
$
|
92
|
$
|
127
|
$
|
162
|
Pension Benefits
|
Post-retirement Benefits
|
|||||||||||||||
(000's omitted)
|
2016
|
2015
|
2016
|
2015
|
||||||||||||
Change in benefit obligation:
|
||||||||||||||||
Benefit obligation at the beginning of year
|
$
|
127,134
|
$
|
127,513
|
$
|
1,918
|
$
|
2,256
|
||||||||
Service cost
|
4,106
|
3,324
|
0
|
0
|
||||||||||||
Interest cost
|
5,624
|
5,506
|
82
|
87
|
||||||||||||
Plan amendment / acquisition
|
22
|
2,395
|
0
|
0
|
||||||||||||
Participant contributions
|
0
|
0
|
516
|
509
|
||||||||||||
Deferred actuarial (gain)/loss
|
(1,628
|
)
|
(2,091
|
)
|
174
|
(45
|
)
|
|||||||||
Benefits paid
|
(8,174
|
)
|
(9,513
|
)
|
(884
|
)
|
(889
|
)
|
||||||||
Benefit obligation at end of year
|
127,084
|
127,134
|
1,806
|
1,918
|
||||||||||||
Change in plan assets:
|
||||||||||||||||
Fair value of plan assets at beginning of year
|
172,026
|
177,865
|
0
|
0
|
||||||||||||
Actual return of plan assets
|
14,402
|
1,125
|
0
|
0
|
||||||||||||
Participant contributions
|
0
|
0
|
516
|
509
|
||||||||||||
Employer contributions
|
2,146
|
616
|
368
|
380
|
||||||||||||
Plan acquisition
|
0
|
1,933
|
0
|
0
|
||||||||||||
Benefits paid
|
(8,174
|
)
|
(9,513
|
)
|
(884
|
)
|
(889
|
)
|
||||||||
Fair value of plan assets at end of year
|
180,400
|
172,026
|
0
|
0
|
||||||||||||
Over/(Under) funded status at year end
|
$
|
53,316
|
$
|
44,892
|
$
|
(1,806
|
)
|
$
|
(1,918
|
)
|
||||||
Amounts recognized in the consolidated statement of condition were:
|
||||||||||||||||
Other assets
|
$
|
64,709
|
$
|
56,361
|
$
|
0
|
$
|
0
|
||||||||
Other liabilities
|
(11,393
|
)
|
(11,469
|
)
|
(1,806
|
)
|
(1,918
|
)
|
||||||||
Amounts recognized in accumulated other comprehensive income (loss) ("AOCI") were:
|
||||||||||||||||
Net loss
|
$
|
28,323
|
$
|
34,016
|
$
|
183
|
$
|
4
|
||||||||
Net prior service cost (credit)
|
2,264
|
2,307
|
(1,801
|
)
|
(1,980
|
)
|
||||||||||
Pre-tax AOCI
|
30,587
|
36,323
|
(1,618
|
)
|
(1,976
|
)
|
||||||||||
Taxes
|
(11,622
|
)
|
(13,815
|
)
|
614
|
751
|
||||||||||
AOCI at year end
|
$
|
18,965
|
$
|
22,508
|
$
|
(1,004
|
)
|
$
|
(1,225
|
)
|
Pension Benefits
|
Post-retirement Benefits
|
|||||||||||||||
(000's omitted)
|
2016
|
2015
|
2016
|
2015
|
||||||||||||
Prior service (credit)/cost
|
$
|
(26
|
)
|
$
|
(5
|
)
|
$
|
110
|
$
|
110
|
||||||
Net (gain) loss
|
(3,517
|
)
|
4,482
|
111
|
(20
|
)
|
||||||||||
Total
|
$
|
(3,543
|
)
|
$
|
4,477
|
$
|
221
|
$
|
90
|
(000's omitted)
|
Pension Benefits
|
Post-retirement Benefits
|
||||||
Prior service cost/(credit)
|
$
|
55
|
$
|
(179
|
)
|
|||
Net loss
|
1,010
|
6
|
||||||
Total
|
$
|
1,065
|
$
|
(173
|
)
|
Pension Benefits
|
Post-retirement Benefits
|
|||||
2016
|
2015
|
2016
|
2015
|
|||
Discount rate
|
4.50%
|
4.70%
|
4.40%
|
4.70%
|
||
Expected return on plan assets
|
7.00%
|
7.00%
|
N/A
|
N/A
|
||
Rate of compensation increase
|
3.50%
|
3.50%
|
N/A
|
N/A
|
Pension Benefits
|
Post-retirement Benefits
|
|||||||||||||||||||||||
(000's omitted)
|
2016
|
2015
|
2014
|
2016
|
2015
|
2014
|
||||||||||||||||||
Service cost
|
$
|
4,106
|
$
|
3,324
|
$
|
3,530
|
$
|
0
|
$
|
0
|
$
|
0
|
||||||||||||
Interest cost
|
5,624
|
5,506
|
5,271
|
82
|
87
|
102
|
||||||||||||||||||
Expected return on plan assets
|
(11,842
|
)
|
(12,169
|
)
|
(11,922
|
)
|
0
|
0
|
0
|
|||||||||||||||
Plan amendment
|
20
|
0
|
0
|
0
|
0
|
0
|
||||||||||||||||||
Amortization of unrecognized net loss/(gain)
|
1,508
|
1,466
|
(307
|
)
|
(5
|
)
|
(13
|
)
|
(7
|
)
|
||||||||||||||
Amortization of prior service cost
|
43
|
8
|
5
|
(179
|
)
|
(179
|
)
|
(179
|
)
|
|||||||||||||||
Net periodic (benefit)
|
$
|
(541
|
)
|
$
|
(1,865
|
)
|
$
|
(3,423
|
)
|
$
|
(102
|
)
|
$
|
(105
|
)
|
$
|
(84
|
)
|
Pension Benefits
|
Post-retirement Benefits
|
|||||||
2016
|
2015
|
2014
|
2016
|
2015
|
2014
|
|||
Discount rate
|
4.70%
|
4.50%
|
5.00%
|
4.70%
|
4.50%
|
4.80%
|
||
Expected return on plan assets
|
7.00%
|
7.00%
|
7.00%
|
N/A
|
N/A
|
N/A
|
||
Rate of compensation increase
|
3.50%
|
3.50%
|
3.50%
|
N/A
|
N/A
|
N/A
|
(000's omitted)
|
Pension Benefits
|
Post-retirement Benefits
|
||||||
2017
|
$
|
7,225
|
$
|
145
|
||||
2018
|
7,320
|
143
|
||||||
2019
|
7,504
|
141
|
||||||
2020
|
7,752
|
138
|
||||||
2021
|
7,914
|
136
|
||||||
2022-2026
|
41,823
|
636
|
Asset category (000's omitted)
|
Quoted Prices
in Active
Markets for Identical Assets
Level 1
|
Significant Observable Inputs
Level 2
|
Significant Unobservable Inputs
Level 3
|
Total
|
||||||||||||
Money Market Accounts
|
$
|
103
|
$
|
8,048
|
$
|
0
|
$
|
8,151
|
||||||||
Equity securities:
|
||||||||||||||||
U.S. large-cap
|
43,235
|
0
|
0
|
43,235
|
||||||||||||
U.S mid/small cap
|
19,032
|
0
|
0
|
19,032
|
||||||||||||
CBSI stock
|
7,417
|
0
|
0
|
7,417
|
||||||||||||
International
|
27,064
|
0
|
0
|
27,064
|
||||||||||||
96,748
|
0
|
0
|
96,748
|
|||||||||||||
Fixed income securities:
|
||||||||||||||||
Government securities
|
25,375
|
5,863
|
0
|
31,238
|
||||||||||||
Investment grade bonds
|
15,253
|
0
|
0
|
15,253
|
||||||||||||
High yield(a)
|
16,615
|
0
|
0
|
16,615
|
||||||||||||
57,243
|
5,863
|
0
|
63,106
|
|||||||||||||
Other investments (b)
|
12,023
|
58
|
0
|
12,081
|
||||||||||||
Total (c)
|
$
|
166,117
|
$
|
13,969
|
$
|
0
|
$
|
180,086
|
Asset category (000's omitted)
|
Quoted Prices
in Active
Markets for Identical Assets
Level 1
|
Significant Observable Inputs
Level 2
|
Significant Unobservable Inputs
Level 3
|
Total
|
||||||||||||
Money Market Accounts
|
$
|
2,240
|
$
|
5,750
|
$
|
0
|
$
|
7,990
|
||||||||
Equity securities:
|
||||||||||||||||
U.S. large-cap
|
34,985
|
0
|
0
|
34,985
|
||||||||||||
U.S mid/small cap
|
12,354
|
0
|
0
|
12,354
|
||||||||||||
CBSI stock
|
8,393
|
0
|
0
|
8,393
|
||||||||||||
International
|
28,136
|
0
|
0
|
28,136
|
||||||||||||
83,868
|
0
|
0
|
83,868
|
|||||||||||||
Fixed income securities:
|
||||||||||||||||
Government securities
|
31,397
|
6,488
|
0
|
37,885
|
||||||||||||
Investment grade bonds
|
14,517
|
0
|
0
|
14,517
|
||||||||||||
High yield(a)
|
17,365
|
0
|
0
|
17,365
|
||||||||||||
63,279
|
6,488
|
0
|
69,767
|
|||||||||||||
Other investments (b)
|
9,937
|
63
|
0
|
10,000
|
||||||||||||
Total (c)
|
$
|
159,324
|
$
|
12,301
|
$
|
0
|
$
|
171,625
|
(a) This category is exchange-traded funds representing a diversified index of high yield corporate bonds.
|
(b) This category is comprised of exchange-traded funds and mutual funds holding non-traditional investment classes including private equity funds
and alternative exchange funds.
|
(c) Excludes dividends and interest receivable totaling $0.3 million and $0.4 million at December 31, 2016 and 2015, respectively.
|
·
|
Money market funds - Managed portfolios, including commercial paper and other fixed income securities issued by U.S. and foreign corporations, asset-backed commercial paper, U.S. government securities, obligations of foreign governments and U.S. and foreign banks, which are valued at the closing price reported on the market on which the underlying securities are traded.
|
·
|
Equity securities and other investments – Mutual funds, equity securities and common stock of the Company which are valued at the quoted market price of shares held at year-end.
|
·
|
Fixed income securities - U.S. Treasuries, municipal bonds and notes, government sponsored entities, and corporate debt valued at the closing price reported on the active market on which the individual securities are traded or for municipal bonds and notes based on quoted prices for similar assets in the active market.
|
Stock Options
|
||||||||
|
Outstanding
|
Weighted-average Exercise Price of Shares
|
||||||
Outstanding at December 31, 2014
|
2,151,776
|
$
|
25.92
|
|||||
Granted
|
293,242
|
35.36
|
||||||
Exercised
|
(469,730
|
)
|
22.42
|
|||||
Forfeited
|
(5,987
|
)
|
30.21
|
|||||
Outstanding at December 31, 2015
|
1,969,301
|
28.15
|
||||||
Granted
|
330,383
|
38.02
|
||||||
Exercised
|
(525,298
|
)
|
25.12
|
|||||
Forfeited
|
(18,394
|
)
|
34.47
|
|||||
Outstanding at December 31, 2016
|
1,755,992
|
30.85
|
||||||
Exercisable at December 31, 2016
|
959,638
|
$
|
26.94
|
Options outstanding
|
Options exercisable
|
|||||||||||||||||||||
Range of Exercise Price
|
Shares
|
Weighted-average
Exercise
Price
|
Weighted- average
Remaining
Life (years)
|
Shares
|
Weighted-average
Exercise
Price
|
|||||||||||||||||
$
|
0.00 – $18.00
|
44,436
|
$
|
17.70
|
2.22
|
44,436
|
$
|
17.70
|
||||||||||||||
$
|
18.001 – $23.00
|
267,307
|
19.06
|
1.97
|
267,307
|
19.06
|
||||||||||||||||
$
|
23.001 – $28.00
|
159,662
|
26.28
|
5.54
|
159,536
|
26.28
|
||||||||||||||||
$
|
28.001 – $29.00
|
203,365
|
28.78
|
5.22
|
153,369
|
28.78
|
||||||||||||||||
$
|
29.001 – $30.00
|
254,826
|
29.79
|
6.21
|
144,226
|
29.79
|
||||||||||||||||
$
|
30.001 – $40.00
|
826,396
|
37.08
|
8.31
|
190,764
|
37.06
|
||||||||||||||||
TOTAL
|
1,755,992
|
$
|
30.85
|
6.28
|
959,638
|
$
|
26.94
|
2016
|
2015
|
2014
|
||||||||||
Weighted-average Fair Value of Options Granted
|
$
|
7.90
|
$
|
7.48
|
$
|
8.38
|
||||||
Assumptions:
|
||||||||||||
Weighted-average expected life (in years)
|
6.50
|
6.50
|
6.50
|
|||||||||
Future dividend yield
|
3.43
|
%
|
3.40
|
%
|
3.70
|
%
|
||||||
Share price volatility
|
30.00
|
%
|
30.34
|
%
|
30.71
|
%
|
||||||
Weighted-average risk-free interest rate
|
1.72
|
%
|
1.73
|
%
|
2.69
|
%
|
Restricted
Shares
|
Weighted-average
grant date fair value
|
|||||||
Unvested at December 31, 2014
|
245,721
|
$
|
26.13
|
|||||
Awards
|
60,519
|
35.39
|
||||||
Forfeitures
|
(874
|
)
|
32.43
|
|||||
Vestings
|
(59,055
|
)
|
28.35
|
|||||
Unvested at December 31, 2015
|
246,311
|
27.85
|
||||||
Awards
|
148,240
|
27.04
|
||||||
Forfeitures
|
(42,394
|
)
|
17.49
|
|||||
Vestings
|
(98,327
|
)
|
25.64
|
|||||
Unvested at December 31, 2016
|
253,830
|
$
|
29.98
|
(000's omitted, except per share data)
|
2016
|
2015
|
2014
|
|||||||||
Net income
|
$
|
103,812
|
$
|
91,230
|
$
|
91,353
|
||||||
Income attributable to unvested stock-based compensation awards
|
(550
|
)
|
(453
|
)
|
(456
|
)
|
||||||
Income available to common shareholders
|
$
|
103,262
|
$
|
90,777
|
$
|
90,897
|
||||||
Weighted-average common shares outstanding - basic
|
44,091
|
40,996
|
40,548
|
|||||||||
Basic earnings per share
|
$
|
2.34
|
$
|
2.21
|
$
|
2.24
|
||||||
Net income
|
$
|
103,812
|
$
|
91,230
|
$
|
91,353
|
||||||
Income attributable to unvested stock-based compensation awards
|
(550
|
)
|
(453
|
)
|
(456
|
)
|
||||||
Income available to common shareholders
|
$
|
103,262
|
$
|
90,777
|
$
|
90,897
|
||||||
Weighted-average common shares outstanding
|
44,091
|
40,996
|
40,548
|
|||||||||
Assumed exercise of stock options
|
394
|
405
|
481
|
|||||||||
Weighted-average common shares outstanding – diluted
|
44,485
|
41,401
|
41,029
|
|||||||||
Diluted earnings per share
|
$
|
2.32
|
$
|
2.19
|
$
|
2.22
|
||||||
Cash dividends declared per share
|
$
|
1.26
|
$
|
1.22
|
$
|
1.16
|
(000's omitted)
|
2016
|
2015
|
||||||
Commitments to extend credit
|
$
|
773,442
|
$
|
811,442
|
||||
Standby letters of credit
|
22,656
|
19,053
|
||||||
Total
|
$
|
796,098
|
$
|
830,495
|
2017
|
$
|
6,078
|
||
2018
|
5,574
|
|||
2019
|
5,040
|
|||
2020
|
3,857
|
|||
2021
|
3,098
|
|||
Thereafter
|
7,297
|
|||
Total
|
$
|
30,944
|
For capital adequacy
|
To be well-capitalized
|
|||||||||||||||||||||||||||||||
For capital adequacy
|
purposes plus Capital
|
under prompt
|
||||||||||||||||||||||||||||||
Actual
|
purposes
|
Conservation Buffer
|
corrective action
|
|||||||||||||||||||||||||||||
(000's omitted)
|
Amount
|
Ratio
|
Amount
|
Ratio
|
Amount
|
Ratio
|
Amount
|
Ratio
|
||||||||||||||||||||||||
Community Bank System, Inc.:
|
||||||||||||||||||||||||||||||||
2016
|
||||||||||||||||||||||||||||||||
Tier 1 Leverage ratio
|
$
|
858,347
|
10.55
|
%
|
$
|
325,438
|
4.00
|
%
|
$
|
406,798
|
5.00
|
%
|
||||||||||||||||||||
Tier 1 risk-based capital
|
858,347
|
18.10
|
%
|
284,583
|
6.00
|
%
|
$
|
314,228
|
6.625
|
%
|
379,445
|
8.00
|
%
|
|||||||||||||||||||
Total risk-based capital
|
905,996
|
19.10
|
%
|
379,445
|
8.00
|
%
|
409,089
|
8.625
|
%
|
474,306
|
10.00
|
%
|
||||||||||||||||||||
Common equity tier 1 capital
|
759,199
|
16.01
|
%
|
213,438
|
4.50
|
%
|
243,082
|
5.125
|
%
|
308,299
|
6.50
|
%
|
||||||||||||||||||||
2015
|
||||||||||||||||||||||||||||||||
Tier 1 Leverage ratio
|
$
|
788,717
|
10.32
|
%
|
$
|
305,761
|
4.00
|
%
|
$
|
382,201
|
5.00
|
%
|
||||||||||||||||||||
Tier 1 risk-based capital
|
788,717
|
17.09
|
%
|
276,886
|
6.00
|
%
|
369,181
|
8.00
|
%
|
|||||||||||||||||||||||
Total risk-based capital
|
834,539
|
18.08
|
%
|
369,181
|
8.00
|
%
|
461,477
|
10.00
|
%
|
|||||||||||||||||||||||
Common equity tier 1 capital
|
689,528
|
14.94
|
%
|
207,664
|
4.50
|
%
|
299,960
|
6.50
|
%
|
|||||||||||||||||||||||
Community Bank, N.A.:
|
||||||||||||||||||||||||||||||||
2016
|
||||||||||||||||||||||||||||||||
Tier 1 Leverage ratio
|
$
|
672,633
|
8.30
|
%
|
$
|
324,080
|
4.00
|
%
|
$
|
405,099
|
5.00
|
%
|
||||||||||||||||||||
Tier 1 risk-based capital
|
672,633
|
14.28
|
%
|
282,662
|
6.00
|
%
|
$
|
312,106
|
6.625
|
%
|
376,883
|
8.00
|
%
|
|||||||||||||||||||
Total risk-based capital
|
720,282
|
15.29
|
%
|
376,883
|
8.00
|
%
|
406,327
|
8.625
|
%
|
471,104
|
10.00
|
%
|
||||||||||||||||||||
Common equity tier 1 capital
|
672,578
|
14.28
|
%
|
211,997
|
4.50
|
%
|
241,441
|
5.125
|
%
|
306,217
|
6.50
|
%
|
||||||||||||||||||||
2015
|
||||||||||||||||||||||||||||||||
Tier 1 Leverage ratio
|
$
|
673,443
|
8.88
|
%
|
$
|
303,256
|
4.00
|
%
|
$
|
379,070
|
5.00
|
%
|
||||||||||||||||||||
Tier 1 risk-based capital
|
673,443
|
14.65
|
%
|
275,739
|
6.00
|
%
|
367,652
|
8.00
|
%
|
|||||||||||||||||||||||
Total risk-based capital
|
719,265
|
15.65
|
%
|
367,652
|
8.00
|
%
|
459,565
|
10.00
|
%
|
|||||||||||||||||||||||
Common equity tier 1 capital
|
673,326
|
14.65
|
%
|
206,804
|
4.50
|
%
|
298,717
|
6.50
|
%
|
(000's omitted)
|
2016
|
2015
|
||||||
Assets:
|
||||||||
Cash and cash equivalents
|
$
|
151,127
|
$
|
97,317
|
||||
Investment securities
|
3,628
|
3,576
|
||||||
Investment in and advances to:
|
||||||||
Bank subsidiary
|
1,116,554
|
1,117,419
|
||||||
Non-bank subsidiaries
|
35,566
|
30,643
|
||||||
Other assets
|
10,345
|
9,996
|
||||||
Total assets
|
$
|
1,317,220
|
$
|
1,258,951
|
||||
Liabilities and shareholders' equity:
|
||||||||
Accrued interest and other liabilities
|
$
|
16,950
|
$
|
16,158
|
||||
Borrowings
|
102,170
|
102,146
|
||||||
Shareholders' equity
|
1,198,100
|
1,140,647
|
||||||
Total liabilities and shareholders' equity
|
$
|
1,317,220
|
$
|
1,258,951
|
(000's omitted)
|
2016
|
2015
|
2014
|
|||||||||
Revenues:
|
||||||||||||
Dividends from subsidiaries:
|
||||||||||||
Bank subsidiary
|
$
|
89,000
|
$
|
70,000
|
$
|
57,200
|
||||||
Non-bank subsidiaries
|
1,750
|
6,000
|
3,900
|
|||||||||
Interest and dividends on investments
|
102
|
94
|
88
|
|||||||||
Total revenues
|
90,852
|
76,094
|
61,188
|
|||||||||
Expenses:
|
||||||||||||
Interest on borrowings
|
2,949
|
2,537
|
2,477
|
|||||||||
Acquisition expenses
|
429
|
0
|
0
|
|||||||||
Other expenses
|
11
|
19
|
37
|
|||||||||
Total expenses
|
3,389
|
2,556
|
2,514
|
|||||||||
Income before tax benefit and equity in undistributed net income of subsidiaries
|
87,463
|
73,538
|
58,674
|
|||||||||
Income tax benefit/(expense)
|
866
|
(572
|
)
|
581
|
||||||||
Income before equity in undistributed net income of subsidiaries
|
88,329
|
72,966
|
59,255
|
|||||||||
Equity in undistributed net income of subsidiaries
|
15,483
|
18,264
|
32,098
|
|||||||||
Net income
|
$
|
103,812
|
$
|
91,230
|
$
|
91,353
|
||||||
Other comprehensive (loss)/income, net of tax:
|
||||||||||||
Other comprehensive income/(loss) related to pension and
other post retirement obligations
|
3,322
|
(4,567
|
)
|
(9,571
|
)
|
|||||||
Other comprehensive (loss)/income related to unrealized
(losses)/gains on available-for-sale securities
|
(14,714
|
)
|
(6,918
|
)
|
66,837
|
|||||||
Other comprehensive (loss)/income
|
(11,392
|
)
|
(11,485
|
)
|
57,266
|
|||||||
Comprehensive income
|
$
|
92,420
|
$
|
79,745
|
$
|
148,619
|
(000's omitted)
|
2016
|
2015
|
2014
|
|||||||||
Operating activities:
|
||||||||||||
Net income
|
$
|
103,812
|
$
|
91,230
|
$
|
91,353
|
||||||
Adjustments to reconcile net income to net cash provided by operating activities
|
||||||||||||
Equity in undistributed net income of subsidiaries
|
(15,483
|
)
|
(18,264
|
)
|
(32,098
|
)
|
||||||
Net change in other assets and other liabilities
|
(215
|
)
|
(27
|
)
|
(479
|
)
|
||||||
Net cash provided by operating activities
|
88,114
|
72,939
|
58,776
|
|||||||||
Investing activities:
|
||||||||||||
Proceeds from sale of investment securities
|
0
|
0
|
3
|
|||||||||
Cash received for acquisitions, net of cash acquired of $0, $81,772, and $0,
respectively
|
0
|
25,505
|
0
|
|||||||||
Capital contributions to subsidiaries
|
0
|
(80,231
|
)
|
0
|
||||||||
Net cash (used in) provided by investing activities
|
0
|
(54,726
|
)
|
3
|
||||||||
Financing activities:
|
||||||||||||
Issuance of common stock
|
15,326
|
13,975
|
13,410
|
|||||||||
Purchase of treasury stock
|
(3,470
|
)
|
(9,126
|
)
|
(4,368
|
)
|
||||||
Sale of treasury stock
|
8,888
|
16,571
|
1,531
|
|||||||||
Cash dividends paid
|
(55,048
|
)
|
(49,273
|
)
|
(46,178
|
)
|
||||||
Net cash used in financing activities
|
(34,304
|
)
|
(27,853
|
)
|
(35,605
|
)
|
||||||
Change in cash and cash equivalents
|
53,810
|
(9,640
|
)
|
23,174
|
||||||||
Cash and cash equivalents at beginning of year
|
97,317
|
106,957
|
83,783
|
|||||||||
Cash and cash equivalents at end of year
|
$
|
151,127
|
$
|
97,317
|
$
|
106,957
|
||||||
Supplemental disclosures of cash flow information:
|
||||||||||||
Cash paid for interest
|
$
|
2,909
|
$
|
2,523
|
$
|
2,473
|
||||||
Supplemental disclosures of noncash financing activities
|
||||||||||||
Dividends declared and unpaid
|
$
|
14,268
|
$
|
13,605
|
$
|
12,254
|
||||||
Capital contributions to subsidiaries
|
0
|
76,461
|
0
|
|||||||||
0
|
102,202
|
0
|
·
|
Level 1 – Quoted prices in active markets for identical assets or liabilities.
|
·
|
Level 2 – Quoted prices in active markets for similar assets or liabilities, or quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability.
|
·
|
Level 3 – Significant valuation assumptions not readily observable in a market.
|
December 31, 2016
|
||||||||||||||||
(000's omitted)
|
Level 1
|
Level 2
|
Level 3
|
Total Fair Value
|
||||||||||||
Available-for-sale investment securities:
|
||||||||||||||||
U.S. Treasury and agency securities
|
$
|
1,902,762
|
$
|
0
|
$
|
0
|
$
|
1,902,762
|
||||||||
Obligations of state and political subdivisions
|
0
|
594,990
|
0
|
594,990
|
||||||||||||
Government agency mortgage-backed securities
|
0
|
235,230
|
0
|
235,230
|
||||||||||||
Corporate debt securities
|
0
|
5,687
|
0
|
5,687
|
||||||||||||
Government agency collateralized mortgage obligations
|
0
|
9,535
|
0
|
9,535
|
||||||||||||
Marketable equity securities
|
452
|
0
|
0
|
452
|
||||||||||||
Total available-for-sale investment securities
|
1,903,214
|
845,442
|
0
|
2,748,656
|
||||||||||||
Mortgage loans held for sale
|
0
|
2,416
|
0
|
2,416
|
||||||||||||
Commitments to originate real estate loans for sale
|
0
|
0
|
54
|
54
|
||||||||||||
Forward sales commitments
|
0
|
3
|
0
|
3
|
||||||||||||
Total
|
$
|
1,903,214
|
$
|
847,861
|
$
|
54
|
$
|
2,751,129
|
||||||||
December 31, 2015
|
||||||||||||||||
(000's omitted)
|
Level 1
|
Level 2
|
Level 3
|
Total Fair Value
|
||||||||||||
Available-for-sale investment securities:
|
||||||||||||||||
U.S. Treasury and agency securities
|
$
|
1,899,978
|
$
|
0
|
$
|
0
|
$
|
1,899,978
|
||||||||
Obligations of state and political subdivisions
|
0
|
666,883
|
0
|
666,883
|
||||||||||||
Government agency mortgage-backed securities
|
0
|
210,865
|
0
|
210,865
|
||||||||||||
Corporate debt securities
|
0
|
16,680
|
0
|
16,680
|
||||||||||||
Government agency collateralized mortgage obligations
|
0
|
13,308
|
0
|
13,308
|
||||||||||||
Marketable equity securities
|
399
|
0
|
0
|
399
|
||||||||||||
Total available-for-sale investment securities
|
1,900,377
|
907,736
|
0
|
2,808,113
|
||||||||||||
Mortgage loans held for sale
|
0
|
932
|
0
|
932
|
||||||||||||
Commitments to originate real estate loans for sale
|
0
|
0
|
117
|
117
|
||||||||||||
Forward sales commitments
|
0
|
(37
|
)
|
0
|
(37
|
)
|
||||||||||
Total
|
$
|
1,900,377
|
$
|
908,631
|
$
|
117
|
$
|
2,809,125
|
||||||||
·
|
Available for sale investment securities – The fair value of available-for-sale investment securities is based upon quoted prices, if available. If quoted prices are not available, fair values are measured using quoted market prices for similar securities or model-based valuation techniques. Level 1 securities include U.S. Treasury obligations and marketable equity securities that are traded by dealers or brokers in active over-the-counter markets. Level 2 securities include U.S. agency securities, mortgage-backed securities issued by government-sponsored entities, municipal securities and corporate debt securities that are valued by reference to prices for similar securities or through model-based techniques in which all significant inputs, such as reported trades, trade execution data, LIBOR swap yield curve, market prepayment speeds, credit information, market spreads, and security's terms and conditions, are observable. See Note C for further disclosure of the fair value of investment securities.
|
·
|
Mortgage loans held for sale – Mortgage loans held for sale are carried at fair value, which is determined using quoted secondary-market prices of loans with similar characteristics and, as such, have been classified as a Level 2 valuation. The unpaid principal value of mortgage loans held for sale at December 31, 2016 is approximately $2.4 million. The unrealized gain on mortgage loans held for sale of approximately $2,000 was recognized in other banking services in the Consolidated Statement of Income for the year ended December 31, 2016.
|
·
|
Forward sales commitments – The Company enters into forward sales commitments to sell certain residential real estate loans. Such commitments are considered to be derivative financial instruments and, therefore, are carried at estimated fair value in the other asset or other liability section of the consolidated balance sheet. The fair value of these forward sales commitments is primarily measured by obtaining pricing from certain government-sponsored entities and reflects the underlying price the entity would pay the Company for an immediate sale on these mortgages. As such, these instruments are classified as Level 2 in the fair value hierarchy.
|
·
|
Commitments to originate real estate loans for sale – The Company enters into various commitments to originate residential real estate loans for sale. Such commitments are considered to be derivative financial instruments and, therefore, are carried at estimated fair value in the other asset or other liability section of the consolidated balance sheet. The estimated fair value of these commitments is determined using quoted secondary market prices obtained from certain government-sponsored entities. Additionally, accounting guidance requires the expected net future cash flows related to the associated servicing of the loan to be included in the fair value measurement of the derivative. The expected net future cash flows are based on a valuation model that calculates the present value of estimated net servicing income. The valuation model incorporates assumptions that market participants would use in estimating future net servicing income. Such assumptions include estimates of the cost of servicing loans, appropriate discount rate and prepayment speeds. The determination of expected net cash flows is considered a significant unobservable input contributing to the Level 3 classification of commitments to originate real estate loans for sale.
|
For the Year Ending December 31,
|
||||||||
2016
|
2015
|
|||||||
(000's omitted)
|
Commitments
to Originate
Real Estate
Loans for Sale
|
Commitments
to Originate
Real Estate
Loans for Sale
|
||||||
Beginning balance
|
$
|
117
|
$
|
185
|
||||
Total (losses)/gains included in earnings (1)
|
(1,234
|
)
|
(808
|
)
|
||||
Commitments to originate real estate loans held for sale, net
|
1,171
|
740
|
||||||
Ending balance
|
$
|
54
|
$
|
117
|
||||
(1) Amounts included in earnings associated with the commitments to originate real estate loans for sale are reported as a component of other banking services in the Consolidated Statement of Income.
|
December 31, 2016
|
December 31, 2015
|
|||||||||||||||||||||||||||||||
(000's omitted)
|
Level 1
|
Level 2
|
Level 3
|
Total Fair Value
|
Level 1
|
Level 2
|
Level 3
|
Total Fair Value
|
||||||||||||||||||||||||
Impaired loans
|
$
|
0
|
$
|
0
|
$
|
633
|
$
|
633
|
$
|
0
|
$
|
0
|
$
|
1,765
|
$
|
1,765
|
||||||||||||||||
Other real estate owned
|
0
|
0
|
1,966
|
1,966
|
0
|
0
|
2,088
|
2,088
|
||||||||||||||||||||||||
Total
|
$
|
0
|
$
|
0
|
$
|
2,599
|
$
|
2,599
|
$
|
0
|
$
|
0
|
$
|
3,853
|
$
|
3,853
|
(000's omitted)
|
Fair Value
|
Valuation Technique
|
Significant Unobservable Inputs
|
Significant Unobservable Input Range
(Weighted Average)
|
||||||
Other real estate owned
|
$
|
1,966
|
Fair value of collateral
|
Estimated cost of disposal/market adjustment
|
9.0% - 97.0% (29.6
|
%)
|
||||
Impaired loans
|
633
|
Fair value of collateral
|
Estimated cost of disposal/market adjustment
|
15.0% - 50.0% (36.5
|
%)
|
|||||
Commitments to originate
real estate loans for sale
|
54
|
Discounted cash flow
|
Embedded servicing value
|
1
|
%
|
(000's omitted)
|
Fair Value
|
Valuation Technique
|
Significant Unobservable Inputs
|
Significant Unobservable Input Range
(Weighted Average)
|
||||||
Other real estate owned
|
$
|
2,088
|
Fair value of collateral
|
Estimated cost of disposal/market adjustment
|
5.3% - 74.0% (27.7
|
%)
|
||||
Impaired loans
|
1,765
|
Fair value of collateral
|
Estimated cost of disposal/market adjustment
|
9.0% - 20.0% (17.9
|
%)
|
|||||
Commitments to originate
real estate loans for sale
|
117
|
Discounted cash flow
|
Embedded servicing value
|
1
|
%
|
December 31, 2016
|
December 31, 2015
|
|||||||||||||||
(000's omitted)
|
Carrying Value
|
Fair Value
|
Carrying Value
|
Fair Value
|
||||||||||||
Financial assets:
|
||||||||||||||||
Net loans
|
$
|
4,901,329
|
4,935,140
|
$
|
4,755,974
|
$
|
4,808,856
|
|||||||||
Financial liabilities:
|
||||||||||||||||
Deposits
|
7,075,954
|
7,071,191
|
6,873,474
|
6,871,098
|
||||||||||||
Borrowings
|
146,200
|
146,200
|
301,300
|
301,300
|
||||||||||||
Subordinated debt held by unconsolidated subsidiary trusts
|
102,170
|
90,144
|
102,146
|
84,680
|
(000's omitted)
|
2016
|
2015
|
||||||
Cash and cash equivalents
|
$
|
30
|
$
|
42
|
||||
Premises and equipment, net
|
6,429
|
6,592
|
||||||
Other assets
|
0
|
9
|
||||||
Total assets
|
$
|
6,459
|
$
|
6,643
|
||||
Accrued interest and other liabilities / Total liabilities
|
$
|
1
|
$
|
5
|
(000's omitted)
|
Banking
|
Employee Benefit Services
|
All Other
|
Eliminations
|
Consolidated
Total
|
|||||||||||||||
2016
|
||||||||||||||||||||
Net interest income
|
$
|
273,542
|
$
|
162
|
$
|
192
|
$
|
0
|
$
|
273,896
|
||||||||||
Provision for loan losses
|
8,076
|
0
|
0
|
0
|
8,076
|
|||||||||||||||
Noninterest income
|
66,059
|
48,261
|
43,747
|
(2,442
|
)
|
155,625
|
||||||||||||||
Amortization of intangible assets
|
2,682
|
420
|
2,377
|
0
|
5,479
|
|||||||||||||||
Other operating expenses
|
191,268
|
37,337
|
35,206
|
(2,442
|
)
|
261,369
|
||||||||||||||
Income before income taxes
|
$
|
137,575
|
$
|
10,666
|
$
|
6,356
|
$
|
0
|
$
|
154,597
|
||||||||||
Assets
|
$
|
8,598,057
|
$
|
38,742
|
$
|
71,428
|
$
|
(41,790
|
)
|
$
|
8,666,437
|
|||||||||
Goodwill
|
$
|
440,870
|
$
|
8,019
|
$
|
16,253
|
$
|
0
|
$
|
465,142
|
||||||||||
2015
|
||||||||||||||||||||
Net interest income
|
$
|
248,167
|
$
|
132
|
$
|
121
|
$
|
0
|
$
|
248,420
|
||||||||||
Provision for loan losses
|
6,447
|
0
|
0
|
0
|
6,447
|
|||||||||||||||
Noninterest income
|
57,704
|
46,784
|
20,967
|
(2,156
|
)
|
123,299
|
||||||||||||||
Amortization of intangible assets
|
2,803
|
515
|
345
|
0
|
3,663
|
|||||||||||||||
Other operating expenses
|
181,865
|
35,218
|
14,465
|
(2,156
|
)
|
229,392
|
||||||||||||||
Income before income taxes
|
$
|
114,756
|
$
|
11,183
|
$
|
6,278
|
$
|
0
|
$
|
132,217
|
||||||||||
Assets
|
$
|
8,513,228
|
$
|
35,011
|
$
|
70,067
|
$
|
(65,637
|
)
|
$
|
8,552,669
|
|||||||||
Goodwill
|
$
|
439,052
|
$
|
8,019
|
$
|
16,181
|
$
|
0
|
$
|
463,252
|
||||||||||
2014
|
||||||||||||||||||||
Net interest income
|
$
|
244,243
|
$
|
92
|
$
|
93
|
$
|
0
|
$
|
244,428
|
||||||||||
Provision for loan losses
|
7,178
|
0
|
0
|
0
|
7,178
|
|||||||||||||||
Noninterest income
|
58,565
|
43,701
|
18,634
|
(1,880
|
)
|
119,020
|
||||||||||||||
Amortization of intangible assets
|
3,438
|
647
|
202
|
0
|
4,287
|
|||||||||||||||
Other operating expenses
|
178,472
|
32,846
|
12,855
|
(1,880
|
)
|
222,293
|
||||||||||||||
Income before income taxes
|
$
|
113,720
|
$
|
10,300
|
$
|
5,670
|
$
|
0
|
$
|
129,690
|
||||||||||
Assets
|
$
|
7,463,379
|
$
|
31,513
|
$
|
15,635
|
$
|
(21,087
|
)
|
$
|
7,489,440
|
|||||||||
Goodwill
|
$
|
364,495
|
$
|
8,019
|
$
|
2,660
|
$
|
0
|
$
|
375,174
|
2016 Results
|
4th
|
3rd
|
2nd
|
1st
|
||||||||||||||||
(000's omitted, except per share data)
|
Quarter
|
Quarter
|
Quarter
|
Quarter
|
Total
|
|||||||||||||||
Net interest income
|
$
|
70,246
|
$
|
68,463
|
$
|
68,306
|
$
|
66,881
|
$
|
273,896
|
||||||||||
Provision for loan losses
|
2,640
|
1,790
|
2,305
|
1,341
|
8,076
|
|||||||||||||||
Net interest income after provision for loan losses
|
67,606
|
66,673
|
66,001
|
65,540
|
265,820
|
|||||||||||||||
Noninterest income
|
38,620
|
39,952
|
38,772
|
38,281
|
155,625
|
|||||||||||||||
Noninterest expenses
|
66,597
|
66,226
|
66,356
|
67,669
|
266,848
|
|||||||||||||||
Income before income taxes
|
39,629
|
40,399
|
38,417
|
36,152
|
154,597
|
|||||||||||||||
Income taxes
|
13,237
|
13,239
|
12,560
|
11,749
|
50,785
|
|||||||||||||||
Net income
|
$
|
26,392
|
$
|
27,160
|
$
|
25,857
|
$
|
24,403
|
$
|
103,812
|
||||||||||
Basic earnings per share
|
$
|
0.59
|
$
|
0.61
|
$
|
0.58
|
$
|
0.55
|
$
|
2.34
|
||||||||||
Diluted earnings per share
|
$
|
0.59
|
$
|
0.61
|
$
|
0.58
|
$
|
0.55
|
$
|
2.32
|
||||||||||
2015 Results
|
4th
|
3rd
|
2nd
|
1st
|
||||||||||||||||
(000's omitted, except per share data)
|
Quarter
|
Quarter
|
Quarter
|
Quarter
|
Total
|
|||||||||||||||
Net interest income
|
$
|
64,989
|
$
|
62,363
|
$
|
61,228
|
$
|
59,840
|
$
|
248,420
|
||||||||||
Provision for loan losses
|
3,327
|
1,906
|
591
|
623
|
6,447
|
|||||||||||||||
Net interest income after provision for loan losses
|
61,662
|
60,457
|
60,637
|
59,217
|
241,973
|
|||||||||||||||
Noninterest income
|
33,148
|
31,386
|
29,719
|
29,046
|
123,299
|
|||||||||||||||
Noninterest expenses
|
64,980
|
56,079
|
56,048
|
55,948
|
233,055
|
|||||||||||||||
Income before income taxes
|
29,830
|
35,764
|
34,308
|
32,315
|
132,217
|
|||||||||||||||
Income taxes
|
9,759
|
10,742
|
10,468
|
10,018
|
40,987
|
|||||||||||||||
Net income
|
$
|
20,071
|
$
|
25,022
|
$
|
23,840
|
$
|
22,297
|
$
|
91,230
|
||||||||||
Basic earnings per share
|
$
|
0.48
|
$
|
0.61
|
$
|
0.58
|
$
|
0.55
|
$
|
2.21
|
||||||||||
Diluted earnings per share
|
$
|
0.47
|
$
|
0.60
|
$
|
0.58
|
$
|
0.54
|
$
|
2.19
|
-
|
Consolidated Statements of Condition,
|
December 31, 2016 and 2015 | |
- | Consolidated Statements of Income, |
Years ended December 31, 2016, 2015, and 2014 | |
- |
Consolidated Statements of Comprehensive Income,
|
Years ended December 31, 2016, 2015, and 2014 | |
- | Consolidated Statements of Changes in Shareholders' Equity, |
Years ended December 31, 2016, 2015, and 2014 | |
- | Consolidated Statement of Cash Flows, |
Years ended December 31, 2016, 2015, and 2014 | |
- | Notes to Consolidated Financial Statements, |
December 31, 2016 | |
- | Report of Independent Registered Public Accounting Firm |
- | Quarterly selected data, |
Years ended December 31, 2016 and 2015 (unaudited) |
2.1
|
Assignment, Purchase and Assumption Agreement, dated as of January 19, 2012, by and among Community Bank, N.A. and First Niagara Bank, N.A. Incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K filed on January 20, 2012 (Registration No. 001-13695).
|
2.2
|
Purchase and Assumption Agreement, dated as of January 19, 2012, by and among Community Bank, N.A. and First Niagara Bank, N.A. Incorporated by reference to Exhibit 2.2 to the Current Report on Form 8-K filed on January 20, 2012 (Registration No. 001-13695).
|
2.3
|
Assignment, Purchase and Assumption Agreement, dated as of January 19, 2012, by and between Community Bank, N.A. and First Niagara Bank, N.A., as amended as restated as of July 19, 2012. Incorporated by reference to Exhibit No. 99.1 to the Current Report on Form 8-K filed on July 24, 2012 (Registration No. 001-13695).
|
2.4
|
Amendment No. 1 to Purchase and Assumption Agreement, dated as of September 6, 2012, by and among Community Bank, N.A. and First Niagara Bank, N.A. Incorporated by reference to Exhibit 99.1 to the Current Report on Form 8-K filed on September 13, 2012 (Registration No. 001-13695).
|
2.5
|
Purchase and Assumption Agreement, dated as of July 23, 2013, by and between Community Bank, N.A. and Bank of America, N.A. Incorporated by reference to Exhibit No. 2.1 to the Current Report on Form 8-K filed on July 26, 2013 (Registration No. 001-13695).
|
2.6
|
Agreement and Plan of Merger, dated as of February 24, 2015, by and between Community Bank System, Inc. and Oneida Financial Corp. Incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K filed on February 25, 2015 (Registration No. 001-13695).
|
2.7
|
Agreement and Plan of Merger, dated as of October 22, 2016, by and between Community Bank System, Inc. and Merchants Bancshares, Inc. Incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K filed on October 27, 2016 (Registration No. 001-13695).
|
|
2.8
|
Agreement and Plan of Merger, dated as of December 2, 2016, by and among Community Bank System, Inc., Northeast Retirement Services, Inc., Cohiba Merger Sub, LLC and Shareholder Representative Services LLC. Incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K filed on December 8, 2016 (Registration No. 001-13695).
|
|
3.1
|
Certificate of Incorporation of Community Bank System, Inc., as amended. Incorporated by reference to Exhibit No. 3.1 to the Registration Statement on Form S-4 filed on October 20, 2000 (Registration No. 333-48374).
|
|
3.2
|
Certificate of Amendment of Certificate of Incorporation of Community Bank System, Inc. Incorporated by reference to Exhibit No. 3.1 to the Quarterly Report on Form 10-Q filed on May 7, 2004 (Registration No. 001-13695).
|
|
3.3
|
Certificate of Amendment of Certificate of Incorporation of Community Bank System, Inc. Incorporated by reference to Exhibit No. 3.1 to the Quarterly Report on Form 10-Q filed on August 9, 2013 (Registration No. 001-13695).
|
|
3.4
|
Bylaws of Community Bank System, Inc., amended July 18, 2007. Incorporated by reference to Exhibit 3.2 to the Current Report on Form 8-K filed on July 24, 2007 (Registration No. 001-13695).
|
|
4.1
|
Form of Common Stock Certificate. Incorporated by reference to Exhibit No. 4.1 to the Amendment No. 1 to the Registration Statement on Form S-3 filed on September 29, 2008 (Registration No. 333-153403).
|
|
10.1 | Indenture, dated as of December 8, 2006, between Community Bank System, Inc. and Wilmington Trust Company, as trustee. Incorporated by reference to Exhibit No. 4.1 to the Current Report on Form 8-K filed on December 12, 2006 (Registration No. 001-13695). | |
10.2 | Amended and Restated Declaration of Trust, dated as of December 8, 2006, among Community Bank System, Inc., as sponsor, Wilmington Trust Company, as Delaware trustee, Wilmington Trust Company, as institutional trustee, and Mark E. Tryniski, Scott A. Kingsley, and Joseph J. Lemchak as administrators. Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on December 12, 2006 (Registration No. 001-13695). | |
10.3 | Guarantee Agreement, dated as of December 8, 2006, between Community Bank System, Inc., as guarantor, and Wilmington Trust Company, as guarantee trustee. Incorporated by reference to Exhibit 10.1 to the Form 8-K filed on December 12, 2006 (Registration No. 001-13695). | |
10.4 | Employment Agreement, effective January 1, 2015, by and between Community Bank System, Inc., Community Bank, N.A., and Mark E. Tryniski. Incorporated by reference to Exhibit No. 10.1 to the Current Report on Form 8-K filed on January 2, 2015 (Registration No. 001-13695).(2) | |
10.5 | Supplemental Retirement Plan Agreement, effective as of December 31, 2008, by and among Community Bank, N.A., Community Bank System, Inc., and Mark E. Tryniski. Incorporated by reference to Exhibit No. 10.2 to the Current Report on Form 8-K filed on March 19, 2009 (Registration No. 001-13695).(2) |
10.6
|
Employment Agreement, dated as of January1, 2017, by and among Community Bank System, Inc., Community Bank N.A., and Scott Kingsley. Incorporated by reference to Exhibit No. 10.1 to the Current Report on Form 8-K filed on January 6, 2017 (Registration No. 001-13695).(2)
|
10.7
|
Supplemental Retirement Plan Agreement, effective September 29, 2009, by and between Community Bank System Inc., Community Bank, N.A., and Scott Kingsley. Incorporated by reference to Exhibit No. 10.1 to the Current Report on Form 8-K filed on October 1, 2009 (Registration No. 001-13695).(2)
|
10.8
|
Employment Agreement, dated as of March 11, 2016, by and between Community Bank System, Inc., Community Bank N.A., and Brian D. Donahue. Incorporated by reference to Exhibit No. 10.1 to the Current Report on Form 8-K filed on March 16, 2016 (Registration No. 001-13695).(2)
|
10.9
|
Supplemental Retirement Plan Agreement, dated as of October 18, 2013, by and between Community Bank System Inc., Community Bank, N.A., and Brian D. Donahue. Incorporated by reference to Exhibit No. 10.2 to the Current Report on Form 8-K filed on October 23, 2013 (Registration No. 001-13695).(2)
|
10.10
|
Employment Agreement, dated as of January1, 2017, by and among Community Bank System, Inc., Community Bank N.A., and George J. Getman. Incorporated by reference to Exhibit No. 10.2 to the Current Report on Form 8-K filed on January 6, 2017 (Registration No. 001-13695).(2)
|
10.11
|
Supplemental Retirement Plan Agreement, dated as of October 18, 2013, by and among Community Bank System, Inc., Community Bank, N.A., and George J. Getman. Incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K filed on October 23, 2013 (Registration No. 001-13695).(2)
|
10.12
|
Employment Agreement, dated as of March 11, 2016, by and among Community Bank System, Inc., Community Bank N.A., and Joseph F. Serbun. Incorporated by reference to Exhibit No. 10.2 to the Current Report on Form 8-K filed on March 16, 2016 (Registration No. 001-13695).(2)
|
10.13
|
Pre-2005 Supplemental Retirement Agreement, effective December 31, 2004, by and between Community Bank System, Inc., Community Bank, N.A., and Sanford Belden. Incorporated by reference to Exhibit No. 10.3 to the Annual Report on Form 10-K filed on March 15, 2005 (Registration No. 001-13695).(2)
|
10.14
|
Post-2004 Supplemental Retirement Agreement, effective January 1, 2005, by and between Community Bank System, Inc., Community Bank, N.A., and Sanford Belden. Incorporated by reference to Exhibit No. 10.2 to the Annual Report on Form 10-K filed on March 15, 2005 (Registration No. 001-13695).(2)
|
10.15
|
Supplemental Retirement Plan Agreement, effective March 26, 2003, by and between Community Bank System Inc. and Thomas McCullough. Incorporated by reference to Exhibit No. 10.11 to the Annual Report on Form 10-K filed on March 12, 2004 (Registration No. 001-13695).(2)
|
10.16
|
2004 Long-Term Incentive Compensation Program, as to be amended. Incorporated by reference to Exhibit No. 99.1 to the Registration Statement on Form S-8 filed on December 19, 2012 (Registration No. 001-13695).(2)
|
10.17
|
2014 Long-Term Incentive Plan. Incorporated by reference to Appendix A to the Definitive Proxy Statement on Schedule 14A filed on April 4, 2014 (Registration No. 001-13695).(2)
|
10.18
|
Stock Balance Plan for Directors, as amended. Incorporated by reference to Annex I to the Definitive Proxy Statement on Schedule 14A filed on March 31, 1998 (Registration No. 001-13695).(2)
|
10.19
|
Deferred Compensation Plan for Directors, as amended. Incorporated by reference to Annex I to the Definitive Proxy Statement on Schedule 14A filed on March 31, 1998 (Registration No. 001-13695).(2)
|
10.20
|
Community Bank System, Inc. Pension Plan Amended and Restated as of January 1, 2004. Incorporated by reference to Exhibit No. 10.27 to the Annual Report on Form 10-K filed on March 15, 2005 (Registration No. 001-13695).(2)
|
10.21
|
Amendment #1 to the Community Bank System, Inc. Pension Plan, as amended and restated as of January 1, 2004 ("Plan"). Incorporated by reference to Exhibit No. 10.27 to the Annual Report on Form 10-K filed on March 15, 2005 (Registration No. 001-13695).(2)
|
10.22
|
Amendment #1 to the Deferred Compensation Plan For Certain Executive Employees of Community Bank System, Inc., as amended and restated as of January 1, 2002. Incorporated by reference to Exhibit No. 10.33 to the Annual Report on Form 10-K filed on March 15, 2005 (Registration No. 001-13695).(2)
|
10.23
|
Community Bank System, Inc. 401(k) Employee Stock Ownership Plan, dated as of December 20, 2011. Incorporated by reference to Exhibit 4.5 to the Registration Statement on Form S-8 filed on December 20, 2013 (Registration No. 001-13695).(2)
|
14.1
|
Community Bank System, Inc., Code of Ethics. Incorporated by reference to Exhibit No. 1 to the Annual Report on Form 10-K filed on March 15, 2005 (Registration No. 001-13695).
|
21.1
|
Subsidiaries of Registrant.(1)
|
23.1
|
Consent of PricewaterhouseCoopers LLP.(1)
|
31.1
|
Certification of Mark E. Tryniski, President and Chief Executive Officer of the Registrant, pursuant to Rule 13a-15(e) or Rule 15d-15(e) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.(1)
|
31.2
|
Certification of Scott Kingsley, Treasurer and Chief Financial Officer of the Registrant, pursuant to Rule 13a-15(e) or Rule 15d-15(e) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.(1)
|
32.1
|
Certification of Mark E. Tryniski, President and Chief Executive Officer of the Registrant, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.(3)
|
32.2
|
Certification of Scott Kingsley, Treasurer and Chief Financial Officer of the Registrant, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.(3)
|
101
|
Interactive data files pursuant to Rule 405 of Regulation S-T: (i) the Consolidated Statements of Condition, (ii) the Consolidated Statements of Income, (iii) the Consolidated Statements of Comprehensive Income, (iv) the Consolidated Statements of Changes in Stockholders' Equity, (v) the Consolidated Statements of Cash Flows, and (vi) the Notes to Consolidated Financial Statements tagged as blocks of text and in detail.(4)
|
/s/ Brian R. Ace
|
/s/ John Parente
|
Brian R. Ace, Director
|
John Parente, Director
|
/s/ Mark J. Bolus
|
/s/ Sally A. Steele
|
Mark J. Bolus, Director
|
Sally A. Steele, Director and Chair of the
Board of Directors
|
/s/ Nicholas A. DiCerbo
|
/s/ John F. Whipple, Jr.
|
Nicholas A. DiCerbo, Director
|
John F. Whipple Jr., Director
|
/s/ Neil E. Fesette
|
/s/ Michael R. Kallet
|
Neil E. Fesette, Director
|
Michael R. Kallet, Director
|
/s/ James A. Gabriel
|
/s/ Eric E. Stickels
|
James A. Gabriel, Director
|
Eric E. Stickels, Director
|
/s/ Edward S. Mucenski
|
|
Edward S. Mucenski, Director
|
|
Name
|
Jurisdiction of Incorporation
|
Community Bank, N.A.
|
Federally Chartered
|
Community Statutory Trust III
|
Connecticut
|
Community Capital Trust IV
|
Delaware
|
Benefit Plans Administrative Services, Inc.
|
New York
|
Benefit Plans Administrative Services, LLC
|
New York
|
BPAS Actuarial and Pension Services, LLC
|
New York
|
CBNA Treasury Management Corporation
|
New York
|
Community Investment Services, Inc.
|
New York
|
CBNA Preferred Funding Corp.
|
Delaware
|
CFSI Close-Out Corp.
|
New York
|
Nottingham Advisors, Inc.
|
Delaware
|
First of Jermyn Realty Company, Inc.
|
Pennsylvania
|
Brilie Corporation
|
New York
|
Town & Country Agency LLC
|
New York
|
Hand Benefits & Trust Company
|
Texas
|
Hand Securities, Inc.
|
Texas
|
Western Catskill Realty, LLC
|
New York
|
BPAS Trust Company of Puerto Rico
|
Puerto Rico
|
OneGroup NY, Inc.
|
New York
|
Workplace Health Solutions Inc.
|
New York
|
Oneida Wealth Management, Inc.
|
New York
|
McMahon, Fenaroli & White, Inc.
|
New York
|
Oneida Preferred Funding II, LLC
|
New York
|
The Carta Group, Inc.
|
New York
|
Cohiba Merger Sub, LLC (Northeast Retirement
Services, LLC as of February 3, 2017)
|
Delaware
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
(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 respects, the financial condition and results of operations of the Company. |
(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 respects, the financial condition and results of operations of the Company. |
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Document and Entity Information - USD ($) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Jan. 31, 2017 |
Jun. 30, 2016 |
|
Document and Entity Information [Abstract] | |||
Entity Registrant Name | COMMUNITY BANK SYSTEM, INC. | ||
Entity Central Index Key | 0000723188 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $ 1,765,509,358 | ||
Entity Common Stock, Shares Outstanding | 44,541,700 | ||
Document Fiscal Year Focus | 2016 | ||
Document Fiscal Period Focus | FY | ||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2016 |
CONSOLIDATED STATEMENTS OF CONDITION (Parenthetical) - USD ($) $ in Thousands |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|
Assets: | ||
Available-for-sale investment securities, cost | $ 2,706,863 | $ 2,742,278 |
Shareholders' equity: | ||
Preferred stock, par value (in dollars per share) | $ 1.00 | $ 1.00 |
Preferred stock, shares authorized (in shares) | 500,000 | 500,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 1.00 | $ 1.00 |
Common stock, shares authorized (in shares) | 75,000,000 | 75,000,000 |
Common stock, shares issued (in shares) | 44,950,352 | 44,442,568 |
Treasury stock, at cost (in shares) | 512,937 | 667,708 |
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Cash dividends declared: | |||
Dividends declared per common share (in dollars per share) | $ 1.26 | $ 1.22 | $ 1.16 |
Common stock issued under employee stock plan, tax benefits | $ 3,091 | $ 2,297 | $ 2,068 |
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Investing activities: | |||
Cash acquired related to acquisition | $ 0 | $ 81,772 | $ 0 |
Financing activities: | |||
Payment made on borrowings | $ 0 | $ 0 | $ 13 |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
12 Months Ended | ||||||
---|---|---|---|---|---|---|---|
Dec. 31, 2016 | |||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE A: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Operations Community Bank System, Inc. (the “Company”) is a registered financial holding company which wholly-owns two significant consolidated subsidiaries: Community Bank, N.A. (the “Bank” or “CBNA”), and Benefit Plans Administrative Services, Inc. (“BPAS”). As of December 31, 2016, BPAS owns four subsidiaries: Benefit Plans Administrative Services, LLC (“BPA”), a provider of defined benefit contribution plan administration services; BPAS Actuarial & Pension Services, LLC (“BPAS-APS”) (formally known as Harbridge Consulting Group, LLC), a provider of actuarial and benefit consulting services; BPAS Trust Company of Puerto Rico, a Puerto Rican trust company; and Hand Benefits & Trust Company (“HB&T”), a provider of collective investment fund administration and institutional trust services. HB&T owns one subsidiary, Hand Securities Inc. (“HSI”), an introducing broker-dealer. The Company also wholly-owns two unconsolidated subsidiary business trusts formed for the purpose of issuing mandatorily-redeemable preferred securities which are considered Tier I capital under regulatory capital adequacy guidelines (see Note P). As of December 31, 2016, the Bank operated 193 full service branches under the Community Bank, N.A. name throughout 35 counties of Upstate New York and six counties of Northeastern Pennsylvania offering a range of commercial and retail banking services. The Bank owns the following operating subsidiaries: The Carta Group, Inc. (“Carta Group”), CBNA Preferred Funding Corporation (“PFC”), CBNA Treasury Management Corporation (“TMC”), Community Investment Services, Inc. (“CISI”), Nottingham Advisors, Inc. (“Nottingham”), OneGroup NY, Inc. (“OneGroup”), Oneida Wealth Management, Inc. (“OWM”), and Oneida Preferred Funding II LLC (“OPFC II”). OneGroup is a full-service insurance agency offering personal and commercial property insurance and other risk management products and services. On August 19, 2016, the Company merged its insurance subsidiary CBNA Insurance Agency, Inc. (“CBNA Insurance”) into OneGroup. PFC and OPFC II primarily act as investors in residential real estate loans and properties. TMC provides cash management, investment, and treasury services to the Bank. CISI, The Carta Group and OWM provide broker-dealer and investment advisory services. On April 22, 2016, the Company merged the activities of OWM into CISI. Nottingham provides asset management services to individuals, corporations, corporate pension and profit sharing plans, and foundations. Principles of Consolidation The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Variable Interest Entities (“VIE”) are legal entities in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the legal entities to finance its activities without additional subordinated financial support. VIEs may be required to be consolidated by a company if it is determined the company is the primary beneficiary of a VIE. The primary beneficiary of a VIE is the enterprise that has: (1) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance, and (2) the obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits of the VIE that could potentially be significant to the VIE. The Company’s VIE’s are described in more detail in Note T to the consolidated financial statements. Critical Accounting Estimates in the Preparation of Financial Statements The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Critical accounting estimates include the allowance for loan losses, actuarial assumptions associated with the pension, post-retirement and other employee benefit plans, the provision for income taxes, investment valuation and other-than-temporary impairment, the carrying value of goodwill and other intangible assets, and acquired loan valuations. Risk and Uncertainties In the normal course of its business, the Company encounters economic and regulatory risks. There are three main components of economic risk: interest rate risk, credit risk and market risk. The Company is subject to interest rate risk to the degree that its interest-bearing liabilities mature or reprice at different speeds, or on different basis, from its interest-earning assets. The Company’s primary credit risk is the risk of default on the Company’s loan portfolio that results from the borrowers’ inability or unwillingness to make contractually required payments. Market risk reflects potential changes in the value of collateral underlying loans, the fair value of investment securities, and loans held for sale. The Company is subject to regulations of various governmental agencies. These regulations can change significantly from period to period. The Company also undergoes periodic examinations by the regulatory agencies which may subject it to further changes with respect to asset valuations, amounts of required loan loss allowances, and operating restrictions resulting from the regulators’ judgments based on information available to them at the time of their examinations. Revenue Recognition The Company recognizes income on an accrual basis. CISI, OWM and Carta Group recognize fee income when investment and insurance products are sold to customers. Nottingham provides asset management services to brokerage firms and clients and recognizes income ratably over the contract period during which service is performed. Revenue from BPA’s administration and recordkeeping services is recognized ratably over the service contract period. Revenue from consulting and actuarial services is recognized when services are rendered. OneGroup recognizes commission revenue at the later of the effective date of the insurance policy, or the date on which the policy premium is billed to the customer. At that date, the earnings process has been completed and the impact of refunds for policy cancellations can be reasonably estimated to establish reserves. The reserve for policy cancellations is based upon historical cancellation experience adjusted for known circumstances. All intercompany revenue and expense among related entities are eliminated in consolidation. Cash and Cash Equivalents For purposes of reporting cash flows, cash and cash equivalents include cash on hand, amounts due from banks, and highly liquid investments with original maturities of less than 90 days. The carrying amounts reported in the balance sheet for cash and cash equivalents approximate those assets’ fair values. Investment Securities The Company can classify its investments in debt and equity securities as trading, held-to-maturity, or available-for-sale. Held-to-maturity securities are those for which the Company has the positive intent and ability to hold until maturity, and are reported at amortized cost. The Company did not use the held-to-maturity classification in 2015 or 2016. Securities classified as available-for-sale are reported at fair value with net unrealized gains and losses reflected as a separate component of shareholders' equity, net of applicable income taxes. None of the Company's investment securities have been classified as trading securities at December 31, 2016. Certain equity securities are stated at cost and include restricted stock of the Federal Reserve Bank of New York (“Federal Reserve”) and Federal Home Loan Bank of New York (“FHLB”). Fair values for investment securities are based upon quoted market prices, where available. If quoted market prices are not available, fair values are based upon quoted market prices of comparable instruments, or a discounted cash flow model using market estimates of interest rates and volatility. The Company conducts an assessment of all securities in an unrealized loss position to determine if other-than-temporary impairment (“OTTI”) exists on a quarterly basis. An unrealized loss exists when the current fair value of an individual security is less than its amortized cost basis. The OTTI assessment considers the security structure, recent security collateral performance metrics, if applicable, external credit ratings, failure of the issuer to make scheduled interest or principal payments, judgment about and expectations of future performance, and relevant independent industry research, analysis, and forecasts. The severity of the impairment and the length of time the security has been impaired is also considered in the assessment. The assessment of whether an OTTI decline exists is performed on each security, regardless of the classification of the security as available-for-sale or held-to-maturity, and involves a high degree of subjectivity and judgment that is based on the information available to management at a point in time. An OTTI loss must be recognized for a debt security in an unrealized loss position if there is intent to sell the security or it is more likely than not the Company will be required to sell the security prior to recovery of its amortized cost basis. In this situation, the amount of loss recognized in income is equal to the difference between the fair value and the amortized cost basis of the security. Even if management does not have the intent, and it is not more likely than not that the Company will be required to sell the securities, an evaluation of the expected cash flows to be received is performed to determine if a credit loss has occurred. For debt securities, a critical component of the evaluation for OTTI is the identification of credit-impaired securities, where the Company does not expect to receive cash flows sufficient to recover the entire amortized cost basis of the security. In the event of a credit loss, only the amount of impairment associated with the credit loss would be recognized in income. The portion of the unrealized loss relating to other factors, such as liquidity conditions in the market or changes in market interest rates, is recorded in accumulated other comprehensive loss. Equity securities are also evaluated to determine whether the unrealized loss is expected to be recoverable based on whether evidence exists to support a realizable value equal to or greater than the amortized cost basis. If it is probable that the amortized cost basis will not be recovered, taking into consideration the estimated recovery period and the ability to hold the equity security until recovery, OTTI is recognized in earnings equal to the difference between the fair value and the amortized cost basis of the security. The specific identification method is used in determining the realized gains and losses on sales of investment securities and OTTI charges. Premiums and discounts on securities are amortized and accreted, respectively, on the interest method basis over the period to maturity or estimated life of the related security. Purchases and sales of securities are recognized on a trade date basis. Loans Loans are stated at unpaid principal balances, net of unearned income. Mortgage loans held for sale are carried at fair value and are included in loans held for sale on the balance sheet. Fair values for variable rate loans that reprice frequently are based on carrying values. Fair values for fixed rate loans are estimated using discounted cash flows and interest rates currently being offered for loans with similar terms to borrowers of similar credit quality. The carrying amount of accrued interest approximates its fair value. Interest on loans is accrued and credited to operations based upon the principal amount outstanding. Nonrefundable loan fees and related direct costs are deferred and included in the loan balances where they are amortized over the life of the loan as an adjustment to loan yield using the effective yield method. Premiums and discounts on purchased loans are amortized using the effective yield method over the life of the loans. Acquired loans Acquired loans are initially recorded at their acquisition date fair values. The carryover of allowance for loan losses is prohibited as any credit losses in the loans are included in the determination of the fair value of the loans at the acquisition date. Fair values for acquired loans are based on a discounted cash flow methodology that involves assumptions and judgments as to credit risk, prepayment risk, liquidity risk, default rates, loss severity, payment speeds, collateral values and discount rate. Acquired impaired loans Acquired loans that have evidence of deterioration in credit quality since origination and for which it is probable, at acquisition, that the Company will be unable to collect all contractually required payments are accounted for as impaired loans under ASC 310-30. The excess of undiscounted cash flows expected at acquisition over the estimated fair value is referred to as the accretable discount and is recognized into interest income over the remaining life of the loans using the interest method. The difference between contractually required payments at acquisition and the undiscounted cash flows expected to be collected at acquisition is referred to as the non-accretable discount. The non-accretable discount represents estimated future credit losses and other contractually required payments that the Company does not expect to collect. Subsequent decreases in expected cash flows are recognized as impairments through a charge to the provision for credit losses resulting in an increase in the allowance for loan losses. Subsequent improvements in expected cash flows result in a recovery of previously recorded allowance for loan losses or a reversal of a corresponding amount of the non-accretable discount, which the Company then reclassifies as an accretable discount that is recognized into interest income over the remaining life of the loans using the interest method. Acquired loans that met the criteria for non-accrual of interest prior to acquisition may be considered performing upon acquisition, regardless of whether the customer is contractually delinquent, if the Company can reasonably estimate the timing and amount of the expected cash flows on such loans and if the Company expects to fully collect the new carrying value of the loans. As such, the Company may no longer consider the loan to be non-accrual or non-performing and may accrue interest on these loans, including the impact of any accretable discount. Acquired non-impaired loans Acquired loans that do not meet the requirements under ASC 310-30 are considered acquired non-impaired loans. The difference between the acquisition date fair value and the outstanding balance represents the fair value adjustment for a loan and includes both credit and interest rate considerations. Fair value adjustments may be discounts (or premiums) to a loan’s cost basis and are accreted (or amortized) to net interest income (or expense) over the loan’s remaining life in accordance with ASC 310-20. Fair value adjustments for revolving loans are accreted (or amortized) using a straight line method. Term loans are accreted (or amortized) using the constant effective yield method. Subsequent to the purchase date, the methods used to estimate the allowance for loan losses for the acquired non-impaired loans is consistent with the policy described below. However, the Company compares the net realizable value of the loans to the carrying value, for loans collectively evaluated for impairment. The carrying value represents the net of the loan’s unpaid principal balance and the remaining purchase discount (or premium) that has yet to be accreted (or amortized) into interest income (or interest expense). When the carrying value exceeds the net realizable value, an allowance for loan losses is recognized. Impaired and Other Nonaccrual Loans The Company places a loan on nonaccrual status when the loan becomes 90 days past due (or sooner, if management concludes collection is doubtful), except when, in the opinion of management, it is well-collateralized and in the process of collection. A loan may be placed on nonaccrual status earlier than ninety days past due if there is deterioration in the financial position of the borrower or if other conditions of the loan so warrant. When a loan is placed on nonaccrual status, uncollected accrued interest is reversed against interest income and the amortization of nonrefundable loan fees and related direct costs is discontinued. Interest income during the period the loan is on nonaccrual status is recorded on a cash basis after recovery of principal is reasonably assured. Nonaccrual loans are returned to accrual status when management determines that the borrower’s performance has improved and that both principal and interest are collectible. This generally requires a sustained period of timely principal and interest payments and a well-documented credit evaluation of the borrower’s financial condition. A loan is considered modified in a troubled debt restructuring (“TDR”) when, due to a borrower’s financial difficulties, the Company makes a concession(s) to the borrower that it would not otherwise consider. These modifications may include, among others, an extension for the term of the loan, or granting a period when interest–only payments can be made with the principal payments and interest caught up over the remaining term of the loan or at maturity. Generally, a nonaccrual loan that has been modified in a TDR remains on nonaccrual status for a period of 12 months to demonstrate that the borrower is able to meet the terms of the modified loan. If the borrower’s ability to meet the revised payment schedule is uncertain, the loan remains on nonaccrual status. Regulatory guidance issued by the OCC requires certain loans that have been discharged in Chapter 7 bankruptcy to be reported as TDRs. In accordance with this new guidance, loans that have been discharged in Chapter 7 bankruptcy but not reaffirmed by the borrower are classified as TDRs, irrespective of payment history or delinquency status, even if the repayment terms for the loan have not been otherwise modified and the Company’s lien position against the underlying collateral remains unchanged. Pursuant to that guidance, the Company records a charge-off equal to any portion of the carrying value that exceeds the net realizable value of the collateral. Commercial loans greater than $0.5 million are evaluated individually for impairment. A loan is considered impaired, based on current information and events, if it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. The measurement of impaired loans is generally based upon the present value of expected future cash flows or the fair value of the collateral, if the loan is collateral-dependent. The Company’s charge-off policy by loan type is as follows:
Allowance for Loan Losses Management continually evaluates the credit quality of the Company’s loan portfolio, and performs a formal review of the adequacy of the allowance for loan losses on a quarterly basis. The allowance reflects management’s best estimate of probable losses inherent in the loan portfolio. Determination of the allowance is subjective in nature and requires significant estimates. The Company’s allowance methodology consists of two broad components - general and specific loan loss allocations. The general loan loss allocation is composed of two calculations that are computed on five main loan segments: business lending, consumer installment - direct, consumer installment - indirect, home equity and consumer mortgage. The first calculation is quantitative and determines an allowance level based on the latest 36 months of historical net charge-off data for each loan class (commercial loans exclude balances with specific loan loss allocations). The second calculation is qualitative and takes into consideration eight qualitative environmental factors: levels and trends in delinquencies and impaired loans; levels of and trends in charge-offs and recoveries; trends in volume and terms of loans; effects of any changes in risk selection and underwriting standards, and other changes in lending policies, procedures, and practices; experience, ability, and depth of lending management and other relevant staff; national and local economic trends and conditions; industry conditions; and effects of changes in credit concentrations. A component of the qualitative calculation is the unallocated allowance for loan loss. The qualitative and quantitative calculations are added together to determine the general loan loss allocation. The specific loan loss allocation relates to individual commercial loans that are both greater than $0.5 million and in a nonaccruing status with respect to interest. Specific loan losses are based on discounted estimated cash flows, including any cash flows resulting from the conversion of collateral or collateral shortfalls. The allowance levels computed from the specific and general loan loss allocation methods are combined with unallocated allowances and allowances needed for acquired loans to derive the total required allowance for loan losses to be reflected on the Consolidated Statement of Condition. Loan losses are charged off against the allowance, while recoveries of amounts previously charged off are credited to the allowance. A provision for loan losses is charged to operations based on management’s periodic evaluation of factors previously mentioned. Intangible Assets Intangible assets include core deposit intangibles, customer relationship intangibles and goodwill arising from acquisitions. Core deposit intangibles and customer relationship intangibles are amortized on either an accelerated or straight-line basis over periods ranging from seven to 20 years. The initial and ongoing carrying value of goodwill and other intangible assets is based upon discounted cash flow modeling techniques that require management to make estimates regarding the amount and timing of expected future cash flows. It also requires use of a discount rate that reflects the current return requirements of the market in relation to present risk-free interest rates, required equity market premiums, peer volatility indicators, and company-specific risk indicators. The Company evaluates goodwill for impairment on an annual basis, or more often if events or circumstances indicate there may be impairment. The implied fair value of a reporting unit’s goodwill is compared to its carrying amount and the impairment loss is measured by the excess of the carrying value over fair value. The fair value of each reporting unit is compared to the carrying amount of that reporting unit in order to determine if impairment is indicated. Premises and Equipment Premises and equipment are stated at cost less accumulated depreciation. Computer software costs that are capitalized only include external direct costs of obtaining and installing the software. The Company has not developed any internal use software. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets. Useful lives range from three to 10 years for equipment; three to seven years for software and hardware; and 10 to 40 years for building and building improvements. Land improvements are depreciated over 20 years and leasehold improvements are amortized over the shorter of the term of the respective lease plus any optional renewal periods that are reasonably assured or life of the asset. Maintenance and repairs are charged to expense as incurred. Other Real Estate Other real estate owned is comprised of properties acquired through foreclosure, or by deed in lieu of foreclosure. These assets are carried at fair value less estimated costs of disposal. At foreclosure, if the fair value, less estimated costs to sell, of the real estate acquired is less than the Company’s recorded investment in the related loan, a write-down is recognized through a charge to the allowance for loan losses. Any subsequent reduction in value is recognized by a charge to income. Operating costs associated with the properties are charged to expense as incurred. At December 31, 2016 and 2015, other real estate amounted to $2.0 million and $2.1 million, respectively, and is included in other assets. Mortgage Servicing Rights Originated mortgage servicing rights are recorded at their fair value at the time of sale of the underlying loan, and are amortized in proportion to and over the period of estimated net servicing income or loss. The Company uses a valuation model that calculates the present value of future cash flows to determine the fair value of servicing rights. In using this valuation method, the Company incorporates assumptions that market participants would use in estimating future net servicing income, which includes estimates of the servicing cost per loan, the discount rate, and prepayment speeds. The carrying value of the originated mortgage servicing rights is included in other assets and is evaluated quarterly for impairment using these same market assumptions. The amount of impairment recognized is the amount by which the carrying value of the capitalized servicing rights for a stratum exceeds estimated fair value. Impairment is recognized through a valuation allowance. Treasury Stock Repurchases of shares of the Company’s common stock are recorded at cost as a reduction of shareholders’ equity. Reissuance of shares of treasury stock is recorded at average cost. Income Taxes The Company and its subsidiaries file a consolidated federal income tax return. Provisions for income taxes are based on taxes currently payable or refundable as well as deferred taxes that are based on temporary differences between the tax basis of assets and liabilities and their reported amounts in the financial statements. Deferred tax assets and liabilities are reported in the financial statements at currently enacted income tax rates applicable to the period in which the deferred tax assets and liabilities are expected to be realized or settled. Benefits from tax positions should be recognized in the financial statements only when it is more likely than not that the tax position will be sustained upon examination by the appropriate taxing authority having full knowledge of all relevant information. A tax position meeting the more-likely-than-not recognition threshold should be measured at the largest amount of benefit for which the likelihood of realization upon ultimate settlement exceeds 50 percent. Retirement Benefits The Company provides defined benefit pension benefits to eligible employees and post-retirement health and life insurance benefits to certain eligible retirees. The Company also provides deferred compensation and supplemental executive retirement plans for selected current and former employees, officers, and directors. Expense under these plans is charged to current operations and consists of several components of net periodic benefit cost based on various actuarial assumptions regarding future experience under the plans, including discount rate, rate of future compensation increases and expected return on plan assets. Assets Under Management or Administration Assets held in fiduciary or agency capacities for customers are not included in the accompanying consolidated statements of condition as they are not assets of the Company. All fees associated with providing asset management services are recorded on an accrual basis of accounting and are included in noninterest income. Advertising Advertising costs amounting to approximately $3.9 million, $3.6 million and $3.2 million for the years ending December 31, 2016, 2015 and 2014, respectively, are nondirect response in nature and expensed as incurred. Earnings Per Share Using the two-class method, basic earnings per common share is computed based upon net income available to common shareholders divided by the weighted average number of common shares outstanding during each period, which excludes the outstanding unvested restricted stock. Diluted earnings per share is computed using the weighted average number of common shares determined for the basic earnings per common share computation plus the dilutive effect of stock options using the treasury stock method. Stock options where the exercise price is greater than the average market price of common shares were not included in the computation of earnings per diluted share as they would have been anti-dilutive. Stock-based Compensation Companies are required to measure and record compensation expense for stock options and other share-based payments on the instruments’ fair value on the date of grant. Stock-based compensation expense is recognized ratably over the requisite service period for all awards (see Note L). Fair Values of Financial Instruments The Company determines fair values based on quoted market values where available or on estimates using present values or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, could not be realized in immediate settlement of the instrument. Certain financial instruments and all nonfinancial instruments are excluded from this disclosure requirement. Accordingly, the aggregate fair value amounts presented do not represent the underlying value of the Company. The fair values of investment securities, loans, deposits, and borrowings have been disclosed in Note R. Reclassifications Certain reclassifications have been made to prior years’ balances to conform to the current year presentation. New Accounting Pronouncements In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606). This new guidance supersedes the revenue recognition requirements in ASC 605, Revenue Recognition, and is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects consideration to which the entity expects to be entitled in exchange for those goods and services. The ASU also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. This guidance is effective for the Company for annual and interim periods beginning after December 15, 2017, and should be applied either retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying this guidance recognized at the date of initial application. The Company’s implementation efforts include the identification of revenue within the scope of the guidance, as well as evaluation of revenue contracts. The Company’s review is ongoing, and the Company will continue to evaluate any impact as additional guidance is issued and as our internal assessment progresses. In January 2016, the FASB issued ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. This guidance addresses certain aspects of recognition, measurement, presentation and disclosure of financial instruments. The primary focus of this guidance is to supersede the guidance to classify equity securities with readily determinable fair values into different categories (trading or available-for-sale) and requires equity securities to be measured at fair value with changes in the fair value recognized through net income. This guidance requires adoption through a cumulative-effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption. This ASU is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption is permitted for all companies in any interim or annual period. The Company is currently evaluating the effect the guidance will have on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). This new guidance supersedes the lease requirements in Topic 840, Leases and is based on the principle that a lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. The accounting applied by a lessor is largely unchanged from that applied under the previous guidance. In addition, the guidance requires an entity to separate the lease components from the nonlease components in a contract. The ASU requires disclosures about the amount, timing, and judgments related to a reporting entity’s accounting for leases and related cash flows. The standard is required to be applied to all leases in existence as of the date of adoption using a modified retrospective transition approach. This guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted for all companies in any interim or annual period. The Company occupies certain offices and uses certain equipment under non-cancelable operating lease agreements, which currently are not reflected in its consolidated statement of condition. The Company expects to recognize lease liabilities and right of use assets associated with these lease agreements; however, the extent of the impact on the Company’s consolidated financial statements is currently under evaluation. In March 2016, the FASB issued ASU 2016-09, Compensation – Stock Compensation (Topic 718). The amendments simplify several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. The new guidance requires all excess tax benefits and tax deficiencies be recognized as income tax expense or benefit in the income statement. The tax effects of exercised or vested awards should be treated as discrete items in the reporting period in which they occur. This guidance requires certain amendments to be applied through a cumulative-effect adjustment to equity as of the beginning of the fiscal period in which the guidance is adopted while other amendments are required to be applied retrospectively or prospectively. This ASU is effective for fiscal periods beginning after December 15, 2016, and interim periods within those annual periods. The Company expects adoption of the guidance will result in increased volatility to reported income tax expense related to excess tax benefits and tax deficiencies for share-based payment transactions; however, the actual amounts recognized in tax expense will be dependent on the amount of share-based transactions entered into and the Company’s stock price on the date of exercise or vesting. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326). This new guidance significantly changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. This ASU will replace the “incurred loss” model under existing guidance with an “expected loss” model for instruments measured at amortized cost, and require entities to record allowances for available-for-sale debt securities rather than reduce the carrying amount, as they do today under the other-than-temporary impairment model. This ASU also simplifies the accounting model for purchased credit-impaired debt securities and loans. This guidance requires adoption through a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. This ASU is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for all companies as of fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company is currently evaluating the impact the guidance will have on the Company’s consolidated financial statements, and expects an increase in the allowance for credit losses resulting from the change to expected losses for the estimated life of the financial asset, including an allowance for debt securities. The amount of the increase in the allowance for credit losses resulting from the new guidance will be impacted by the portfolio composition and asset quality at the adoption date, as well as economic conditions and forecasts at the time of adoption. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230). The amendments provide guidance on the following eight specific cash flow issues: 1) debt prepayment or debt extinguishment costs; 2) settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing; 3) contingent consideration payments made after a business combination; 4) proceeds from the settlement of insurance claims; 5) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies; 6) distributions received from equity method investees; 7) beneficial interests in securitization transactions; and 8) separately identifiable cash flows and application of the predominance principle. This ASU is effective for fiscal years beginning after December 31, 2017, including interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. As this guidance only affects the classification within the statement of cash flows, this ASU is not expected to have a material impact on the Company’s consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other (Topic 350). The amendments simplify how an entity is required to test goodwill for impairment by eliminating the requirement to measure a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. Instead, an entity will perform its goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount, and recognize an impairment charge for the amount by which the carrying amount of the reporting unit exceeds its fair value. Impairment loss recognized under this new guidance will be limited to the goodwill allocated to the reporting unit. This ASU is effective prospectively for the Company for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. This ASU is not expected to have a material impact on the Company’s consolidated financial statements. |
ACQUISITIONS |
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ACQUISITIONS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ACQUISITIONS | NOTE B: ACQUISITIONS Subsequent Event – Northeast Retirement Services, Inc. On February 3, 2017, the Company completed its acquisition of Northeast Retirement Services, Inc. (“NRS”) and its subsidiary Global Trust Company (“GTC”) headquartered in Woburn, Massachusetts (see Note V). Pending Acquisition – Merchants Bancshares, Inc. On October 24, 2016, the Company announced that it had entered into a definitive agreement to acquire Merchants Bancshares, Inc. (“Merchants”), parent company of Merchants Bank headquartered in South Burlington, Vermont, for approximately $362 million in Company stock and cash. The acquisition will extend the Company’s footprint into the Vermont and Western Massachusetts markets. Upon the completion of the merger, Community Bank will add 31 branch locations in Vermont and one location in Massachusetts with approximately $2.0 billion of assets, and deposits of $1.5 billion. The acquisition is expected to close during the third quarter of 2017, pending both customary regulatory and Merchants shareholder approval. The Company expects to incur certain one-time, transaction-related costs in 2017. On January 4, 2016, the Company, through its subsidiary, CBNA Insurance, completed its acquisition of WJL Agencies Inc. doing business as The Clark Insurance Agencies (“WJL”), an insurance agency operating in northern New York. The Company paid $0.6 million in cash for the intangible assets of the company. Goodwill in the amount of $0.3 million and intangible assets in the amount of $0.3 million were recorded in conjunction with the acquisition. The effects of the acquired assets and liabilities have been included in the consolidated financial statements since that date. On August 19, 2016, the Company merged together its insurance subsidiaries and as of that date, the activities of CBNA Insurance were merged into OneGroup. On December 4, 2015, the Company completed its acquisition of Oneida Financial Corp. (“Oneida”), parent company of Oneida Savings Bank, headquartered in Oneida, New York for approximately $158 million in Company stock and cash, comprised of $56.3 million of cash and the issuance of 2.38 million common shares. Upon the completion of the merger, the Bank added 12 branch locations in Oneida and Madison counties and approximately $769 million of assets, including approximately $399 million of loans and $226 million of investment securities, along with $699 million of deposits. Through the acquisition of Oneida, the Company acquired OneGroup and OWM as wholly-owned subsidiaries primarily engaged in offering insurance and investment advisory services. These subsidiaries complement the Company’s other non-banking financial services businesses. The effects of the acquired assets and liabilities have been included in the consolidated financial statements since that date. On January 1, 2014, the Company, through its subsidiary, BPAS-APS (formerly known as Harbridge Consulting Group, LLC), completed its acquisition of a professional services practice from EBS-RMSCO, Inc., a subsidiary of The Lifetime Healthcare Companies (“EBS-RMSCO”). This professional services practice, which provides actuarial valuation and consulting services to clients who sponsor pension and post-retirement medical and welfare plans, enhanced the Company’s participation in the Western New York marketplace. The effects of the acquired assets and liabilities have been included in the consolidated financial statements since that date. The assets and liabilities assumed in the acquisitions were recorded at their estimated fair values based on management's best estimates using information available at the dates of the acquisition, and are subject to adjustment based on updated information not available at the time of acquisition. During the first quarter of 2016, the carrying amount of other assets decreased by $0.9 million and other liabilities increased by $0.7 million as a result of adjustments made to fair value estimates recorded for the Oneida acquisition. Other assets decreased as a result of new information obtained related to the fair value calculation of loans partially offset by a decrease in the fair value adjustment made to accounts receivable for uncollectible accounts as actual cash receipts exceed anticipated cash receipts. Other liabilities increased as a result of updated information related to deferred taxes. Goodwill increased $1.6 million as a result of these changes in fair value estimates. The above referenced acquisitions expanded the Company’s geographical presence in New York and management expects that the Company will benefit from greater geographic diversity and the advantages of other synergistic business development opportunities. The following table summarizes the estimated fair value of the assets acquired and liabilities assumed.
Acquired loans that have evidence of deterioration in credit quality since origination and for which it is probable, at acquisition, that the Company will be unable to collect all contractually required payments were aggregated by comparable characteristics and recorded at fair value without a carryover of the related allowance for loan losses. Cash flows for each loan were determined using an estimate of credit losses and an estimated rate of prepayments. Projected monthly cash flows were then discounted to present value using a market-based discount rate. The excess of the undiscounted expected cash flows over the estimated fair value is referred to as the “accretable yield” and is recognized into interest income over the remaining lives of the acquired loans. The following is a summary of the loans acquired from Oneida at the date of acquisition:
The fair value of checking, savings and money market deposit accounts acquired were assumed to approximate the carrying value as these accounts have no stated maturity and are payable on demand. Certificate of deposit accounts were valued at the present value of the certificates’ expected contractual payments discounted at market rates for similar certificates. The core deposit intangibles and other intangibles related to the EBS-RMSCO, Oneida and WJL acquisitions are being amortized using an accelerated method over their estimated useful life of approximately eight years. The goodwill, which is not amortized for book purposes, was assigned to the Banking and All Other segments for the Oneida acquisition, the Employee Benefit Services segment for the EBS-RMSCO acquisition, and to the All Other segment for WJL. The goodwill arising from the EBS-RMSCO and WJL deals is deductible for tax purposes. Goodwill arising from the Oneida acquisition is not deductible for tax purposes. Direct costs related to the acquisitions were expensed as incurred. Merger and acquisition integration-related expenses amount to $1.7 million, $7.0 million and $0.1 million during 2016, 2015 and 2014, respectively, and have been separately stated in the Consolidated Statements of Income. Supplemental Pro Forma Financial Information The following unaudited condensed pro forma information assumes the Oneida acquisition had been completed as of January 1, 2014 for the year ended December 31, 2015 and December 31, 2014. The table below has been prepared for comparative purposes only and is not necessarily indicative of the actual results that would have been attained had the acquisition occurred as of the beginning of the years presented, nor is it indicative of the Company’s future results. Furthermore, the unaudited pro forma information does not reflect management’s estimate of any revenue-enhancing opportunities nor anticipated cost savings or the impact of conforming certain acquiree accounting policies to the Company’s policies that may have occurred as a result of the integration and consolidation of the acquisitions. The pro forma information set forth below reflects adjustments related to (a) certain purchase accounting fair value adjustments; and (b) amortization of customer lists and core deposit intangibles. Expenses totaling $14.0 million related to conversion of systems and other costs of integration, as well as certain one-time costs, are excluded from the pro forma year ended December 31, 2015 and were included in the pro forma year ended December 31, 2014.
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INVESTMENT SECURITIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVESTMENT SECURITIES | NOTE C: INVESTMENT SECURITIES The amortized cost and estimated fair value of investment securities as of December 31 are as follows:
A summary of investment securities that have been in a continuous unrealized loss position for less than or greater than twelve months is as follows: As of December 31, 2016
As of December 31, 2015
The unrealized losses reported pertaining to securities issued by the U.S. government and its sponsored entities, include treasuries, agencies, and mortgage-backed securities issued by Ginnie Mae, Fannie Mae, and Freddie Mac which are currently rated AAA by Moody’s Investor Services, AA+ by Standard & Poor’s and are guaranteed by the U.S. government. The majority of the obligations of state and political subdivisions and corporations carry a credit rating of A or better. Additionally, a majority of the obligations of state and political subdivisions carry a secondary level of credit enhancement. The Company does not intend to sell these securities, nor is it more likely than not that the Company will be required to sell these securities prior to recovery of the amortized cost. The unrealized losses in the portfolios are primarily attributable to changes in interest rates. As such, management does not believe any individual unrealized loss as of December 31, 2016 represents OTTI. The amortized cost and estimated fair value of debt securities at December 31, 2016, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately.
Cash flow information on investment securities for the years ended December 31 is as follows:
Investment securities with a carrying value of $1.865 billion and $1.750 billion at December 31, 2016 and 2015, respectively, were pledged to collateralize certain deposits and borrowings. |
LOANS |
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LOANS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LOANS | NOTE D: LOANS The segments of the Company’s loan portfolio are disaggregated into the following classes that allow management to monitor risk and performance:
The balances of these classes at December 31 are summarized as follows:
The Company had approximately $22.8 million and $20.0 million of net deferred loan origination costs included in gross loans as of December 31, 2016 and 2015, respectively. Certain directors and executive officers of the Company, as well as associates of such persons, are loan customers. Loans to these individuals were made in the ordinary course of business under normal credit terms and do not have more than a normal risk of collection. Following is a summary of the aggregate amount of such loans during 2016 and 2015.
Acquired loans Acquired loans are recorded at fair value as of the date of purchase with no allowance for loan loss. The outstanding principal balance and the related carrying amount of acquired loans included in the Consolidated Statement of Condition at December 31 are as follows:
The outstanding balance related to credit impaired acquired loans was $6.6 million and $8.5 million at December 31, 2016 and 2015, respectively. The changes in the accretable discount related to the credit impaired acquired loans are as follows:
Credit Quality Management monitors the credit quality of its loan portfolio on an ongoing basis. Measurement of delinquency and past due status are based on the contractual terms of each loan. Past due loans are reviewed on a monthly basis to identify loans for non-accrual status. The following is an aged analysis of the Company’s past due loans by class as of December 31, 2016: Legacy Loans (excludes loans acquired after January 1, 2009)
Acquired Loans (includes loans acquired after January 1, 2009)
The following is an aged analysis of the Company’s past due loans by class as of December 31, 2015: Legacy Loans (excludes loans acquired after January 1, 2009)
Acquired Loans (includes loans acquired after January 1, 2009)
The Company uses several credit quality indicators to assess credit risk in an ongoing manner. The Company’s primary credit quality indicator for its business lending portfolio is an internal credit risk rating system that categorizes loans as “pass”, “special mention”, or “classified”. Credit risk ratings are applied individually to those classes of loans that have significant or unique credit characteristics that benefit from a case-by-case evaluation. In general, the following are the definitions of the Company’s credit quality indicators:
The following table shows the amount of business lending loans by credit quality category:
All other loans are underwritten and structured using standardized criteria and characteristics, primarily payment performance, and are normally risk rated and monitored collectively on a monthly basis. These are typically loans to individuals in the consumer categories and are delineated as either performing or nonperforming. Performing loans include current, 30 – 89 days past due and acquired impaired loans. Nonperforming loans include 90+ days past due and still accruing and nonaccrual loans. The following tables detail the balances in all loan categories except for business lending at December 31, 2016: Legacy loans (excludes loans acquired after January 1, 2009)
Acquired loans (includes loans acquired after January 1, 2009)
The following table details the balances in all other loan categories at December 31, 2015: Legacy loans (excludes loans acquired after January 1, 2009)
Acquired loans (includes loans acquired after January 1, 2009)
All loan classes are collectively evaluated for impairment except business lending, as described in Note A. A summary of individually evaluated impaired loans as of December 31, 2016 and 2015 is as follows:
In the course of working with borrowers, the Company may choose to restructure the contractual terms of certain loans. In this scenario, the Company attempts to work-out an alternative payment schedule with the borrower in order to optimize collectability of the loan. Any loans that are modified are reviewed by the Company to identify if a troubled debt restructuring (“TDR”) has occurred, which is when, for economic or legal reasons related to a borrower’s financial difficulties, the Company grants a concession to the borrower that it would not otherwise consider. Terms may be modified to fit the ability of the borrower to repay in line with its current financial standing and the restructuring of the loan may include the transfer of assets from the borrower to satisfy the debt, a modification of loan terms, or a combination of the two. With regard to determination of the amount of the allowance for loan losses, troubled debt restructured loans are considered to be impaired. As a result, the determination of the amount of allowance for loan losses related to impaired loans for each portfolio segment within TDRs is the same as detailed previously. In accordance with clarified guidance issued by the OCC, loans that have been discharged in Chapter 7 bankruptcy but not reaffirmed by the borrower, are classified as TDRs, irrespective of payment history or delinquency status, even if the repayment terms for the loan have not been otherwise modified. The Company’s lien position against the underlying collateral remains unchanged. Pursuant to that guidance, the Company records a charge-off equal to any portion of the carrying value that exceeds the net realizable value of the collateral. The amount of loss incurred in 2016, 2015 and 2014 was immaterial. TDRs less than $0.5 million are collectively included in the general loan loss allocation and the qualitative review, if necessary. Commercial loans greater than $0.5 million are individually evaluated for impairment, and if necessary, a specific allocation of the allowance for loan losses is provided. Information regarding TDRs as of December 31, 2016 and December 31, 2015 is as follows
The following table presents information related to loans modified in a TDR during the years ended December 31, 2016 and 2015. Of the loans noted in the table below, all loans for the years ended December 31, 2016 and December 31, 2015, were modified due to a Chapter 7 bankruptcy as described previously. The financial effects of these restructurings were immaterial.
Allowance for Loan Losses The allowance for loan losses is general in nature and is available to absorb losses from any loan type despite the analysis below. The following presents by class the activity in the allowance for loan losses:
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PREMISES AND EQUIPMENT |
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PREMISES AND EQUIPMENT [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PREMISES AND EQUIPMENT | NOTE E: PREMISES AND EQUIPMENT Premises and equipment consist of the following at December 31:
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GOODWILL AND IDENTIFIABLE INTANGIBLE ASSETS |
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GOODWILL AND IDENTIFIABLE INTANGIBLE ASSETS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
GOODWILL AND IDENTIFIABLE INTANGIBLE ASSETS | NOTE F: GOODWILL AND IDENTIFIABLE INTANGIBLE ASSETS The gross carrying amount and accumulated amortization for each type of identifiable intangible asset are as follows:
The estimated aggregate amortization expense for each of the five succeeding fiscal years ended December 31 is as follows:
Shown below are the components of the Company’s goodwill at December 31, 2016 and 2015:
During the first quarter of 2016, the Company performed its annual internal valuation of goodwill and impairment analysis by comparing the fair value of each reporting unit to its carrying value. Results of the valuations indicate there was no goodwill impairment. There were no events between the date of the valuation and year end that warranted additional analysis. Mortgage Servicing Rights Under certain circumstances, the Company sells consumer residential mortgage loans in the secondary market and typically retains the right to service the loans sold. Generally, the Company’s residential mortgage loans sold to third parties are sold on a non-recourse basis. Upon sale, a mortgage servicing right (“MSR”) is established, which represents the current fair value of future net cash flows expected to be realized for performing the servicing activities. The Company stratifies these assets based on predominant risk characteristics, namely expected term of the underlying financial instruments, and uses a valuation model that calculates the present value of future cash flows to determine the fair value of servicing rights. MSRs are recorded in other assets at the lower of the initial capitalized amount, net of accumulated amortization or fair value. Mortgage loans serviced for others are not included in the accompanying consolidated statements of condition. The following table summarizes the changes in carrying value of MSRs and the associated valuation allowance:
The following table summarizes the key economic assumptions used to estimate the value of the MSRs at December 31:
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DEPOSITS |
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DEPOSITS [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DEPOSITS | NOTE G: DEPOSITS Deposits consist of the following at December 31:
The approximate maturities of time deposits at December 31, 2016 are as follows:
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BORROWINGS |
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BORROWINGS [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
BORROWINGS | NOTE H: BORROWINGS Outstanding borrowings at December 31 are as follows:
FHLB advances are collateralized by a blanket lien on the Company's residential real estate loan portfolio and various investment securities. Borrowings at December 31, 2016 have contractual maturity dates as follows:
The weighted-average interest rate on borrowings for the years ended December 31, 2016 and 2015 was 1.46% and 0.82%, respectively. The Company sponsors two business trusts, Community Statutory Trust III and Community Capital Trust IV, of which 100% of the common stock is owned by the Company. The trusts were formed for the purpose of issuing company-obligated mandatorily redeemable preferred securities to third-party investors and investing the proceeds from the sale of such preferred securities solely in junior subordinated debt securities of the Company. The debentures held by each trust are the sole assets of that trust. Distributions on the preferred securities issued by each trust are payable quarterly at a rate per annum equal to the interest rate being earned by the trust on the debentures held by that trust and are recorded as interest expense in the consolidated financial statements. The preferred securities are subject to mandatory redemption, in whole or in part, upon repayment of the debentures. The Company has entered into agreements which, taken collectively, fully and unconditionally guarantee the preferred securities subject to the terms of each of the guarantees. The terms of the preferred securities of each trust are as follows:
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INCOME TAXES |
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INCOME TAXES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INCOME TAXES | NOTE I: INCOME TAXES The provision for income taxes for the years ended December 31 is as follows:
Components of the net deferred tax liability, included in other liabilities, as of December 31 are as follows:
The Company has determined that no valuation allowance is necessary as it is more likely than not that the gross deferred tax assets will be realized through carryback of future deductions to taxable income in prior years, future reversals of existing temporary differences, and through future taxable income. A reconciliation of the differences between the federal statutory income tax rate and the effective tax rate for the years ended December 31 is shown in the following table:
A reconciliation of the unrecognized tax benefits for the years ended December 31 is shown in the following table:
As of December 31, 2016, the total amount of unrecognized tax benefits that would impact the Company’s effective tax rate if recognized is $0.1 million. It is reasonably possible that the amount of unrecognized tax benefits could change in the next twelve months as a result of various examinations and expiration of statutes of limitations on prior tax returns. The Company’s policy is to recognize interest and penalties related to unrecognized tax benefits as part of income taxes in the consolidated statement of income. The accrued interest related to tax positions was immaterial. The Company’s federal and state income tax returns are routinely subject to examination from various governmental taxing authorities. Such examinations may result in challenges to the tax return treatment applied by the Company to specific transactions. Management believes that the assumptions and judgment used to record tax-related assets or liabilities have been appropriate. Future examinations by taxing authorities of the Company’s federal or state tax returns could have a material impact on the Company’s results of operations. The Company’s federal income tax returns for years after 2012 may still be examined by the Internal Revenue Service. New York State income tax returns for years after 2012 may still be examined by the New York Department of Taxation and Finance. It is not possible to estimate when those examinations may be completed. |
LIMITS ON DIVIDENDS AND OTHER REVENUE SOURCES |
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Dec. 31, 2016 | |
LIMITS ON DIVIDENDS AND OTHER REVENUE SOURCES [Abstract] | |
LIMITS ON DIVIDENDS AND OTHER REVENUE SOURCES | NOTE J: LIMITS ON DIVIDENDS AND OTHER REVENUE SOURCES The Company’s ability to pay dividends to its shareholders is largely dependent on the Bank’s ability to pay dividends to the Company. In addition to the capital requirements discussed below, the circumstances under which the Bank may pay dividends are limited by federal statutes, regulations, and policies. For example, as a national bank, the Bank must obtain the approval of the Office of the Comptroller of the Currency (“OCC”) for payments of dividends if the total of all dividends declared in any calendar year would exceed the total of the Bank’s net profits, as defined by applicable regulations, for that year, combined with its retained net profits for the preceding two years. Furthermore, the Bank may not pay a dividend in an amount greater than its undivided profits then on hand after deducting its losses and bad debts, as defined by applicable regulations. At December 31, 2016, the Bank had approximately $57.6 million in undivided profits legally available for the payment of dividends. In addition, the Board of Governors of the Federal Reserve System (“FRB”) and the OCC are authorized to determine under certain circumstances that the payment of dividends would be an unsafe or unsound practice and to prohibit payment of such dividends. The FRB has indicated that banking organizations should generally pay dividends only out of current operating earnings. There are also statutory limits on the transfer of funds to the Company by its banking subsidiary, whether in the form of loans or other extensions of credit, investments or assets purchases. Such transfer by the Bank to the Company generally is limited in amount to 10% of the Bank’s capital and surplus, or 20% in the aggregate. Furthermore, such loans and extensions of credit are required to be collateralized in specific amounts. |
BENEFIT PLANS |
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BENEFIT PLANS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
BENEFIT PLANS | NOTE K: BENEFIT PLANS Pension and post-retirement plans The Company provides a qualified defined benefit pension to eligible employees and retirees, other post-retirement health and life insurance benefits to certain retirees, an unfunded supplemental pension plan for certain key executives, and an unfunded stock balance plan for certain of its nonemployee directors. Using a measurement date of December 31, the following table shows the funded status of the Company's plans reconciled with amounts reported in the Company's consolidated statements of condition:
The benefit obligation for the defined benefit pension plan was $115.7 million as of December 31, 2016 and 2015, and the fair value of plan assets as of December 31, 2016 and 2015 was $180.4 million and $172.0 million, respectively. Effective December 31, 2015, the State Bank of Chittenango pension plan was merged into the Community Bank System, Inc. Pension Plan and the combined plan was revalued. The Company has unfunded supplemental pension plans for certain key active and retired executives. The projected benefit obligation for the unfunded supplemental pension plan for certain key executives was $11.3 million for 2016 and $11.4 million for 2015, respectively. The Company also has an unfunded stock balance plan for certain of its nonemployee directors. The projected benefit obligation for the unfunded stock balance plan was $0.1 million for 2016 and $0.1 million for 2015, respectively. The plan was frozen effective December 31, 2009. Effective December 31, 2009, the Company terminated its post-retirement medical program for current and future employees. Remaining plan participants will include only existing retirees as of December 31, 2010. This change was accounted for as a negative plan amendment and a $3.5 million, net of income taxes, benefit for prior service was recognized in AOCI in 2009. This negative plan amendment is being amortized over the expected benefit utilization period of remaining plan participants. Amounts recognized in accumulated other comprehensive income, net of tax, for the year ended December 31, are as follows:
The estimated costs, net of tax, that will be amortized from accumulated other comprehensive (income) loss into net periodic (income) cost over the next fiscal year are as follows:
The weighted-average assumptions used to determine the benefit obligations as of December 31 are as follows:
The net periodic benefit cost as of December 31 is as follows:
Prior service costs in which all or almost all of the plan’s participants are fully eligible for benefits under the plan are amortized on a straight-line basis over the expected future working years of all active plan participants. Unrecognized gains or losses are amortized using the “corridor approach”, which is the minimum amortization required. Under the corridor approach, the net gain or loss in excess of 10 percent of the greater of the projected benefit obligation or the market-related value of the assets is amortized on a straight-line basis over the expected future working years of all active plan participants. The weighted-average assumptions used to determine the net periodic pension cost for the years ended December 31 are as follows:
The amount of benefit payments that are expected to be paid over the next ten years are as follows:
The payments reflect future service and are based on various assumptions including retirement age and form of payment (lump-sum versus annuity). Actual results may differ from these estimates. The assumed discount rate is used to reflect the time value of future benefit obligations. The discount rate was determined based upon the yield on high-quality fixed income investments expected to be available during the period to maturity of the pension benefits. This rate is sensitive to changes in interest rates. A decrease in the discount rate would increase the Company’s obligation and future expense while an increase would have the opposite effect. The expected long-term rate of return was estimated by taking into consideration asset allocation, reviewing historical returns on the type of assets held and current economic factors. Based on the Company’s anticipation of future experience under the defined benefit pension plan, the mortality tables used to determine future benefit obligations under the plan were updated as of December 31, 2016 to the RP-2014 Mortality Table for annuitants and non-annuitants, adjusted backward to 2006 with Scale MP-2014, and then adjusted for mortality improvements with the Scale MP-2016 mortality improvement scale on a generational basis. The appropriateness of the assumptions is reviewed annually. Plan Assets The investment objective for the defined benefit pension plan is to achieve an average annual total return over a five-year period equal to the assumed rate of return used in the actuarial calculations. At a minimum performance level, the portfolio should earn the return obtainable on high quality intermediate-term bonds. The Company’s perspective regarding portfolio assets combines both preservation of capital and moderate risk-taking. Asset allocation favors equities, with a target allocation of approximately 60% equity securities and 40% fixed income securities and money market funds. Due to the volatility in the market, the target allocation is not always desirable and asset allocations will fluctuate between acceptable ranges. Prohibited transactions include purchase of securities on margin, uncovered call options, and short sale transactions. The fair values of the Company’s defined benefit pension plan assets at December 31, 2016 by asset category are as follows:
The fair values of the Company’s defined benefit pension plan assets at December 31, 2015 by asset category are as follows:
The valuation techniques used to measure fair value for the items in the table above are as follows:
The Company makes contributions to its funded qualified pension plan as required by government regulation or as deemed appropriate by management after considering the fair value of plan assets, expected return on such assets, and the value of the accumulated benefit obligation. The Company made a $1.53 million contribution to the State Bank of Chittenango pension plan in 2016. The Company made a $2.9 million contribution to its defined benefit pension plan in 2017. The Company funds the payment of benefit obligations for the supplemental pension and post-retirement plans because such plans do not hold assets for investment. Tupper Lake National Bank (“TLNB”), acquired in 2007, participated in the Pentegra Defined Benefit Plan for Financial Institutions (“Pentegra DB Plan”), a multi-employer tax qualified defined benefit pension plan. The identification number and plan number of the Pentegra DB Plan are 13-5645888 and 333, respectively. All employees of TLNB who met minimum service requirements participated in the plan. As of June 30, 2015, the Pentegra DB Plan had total assets of $3.3 billion, actuarial present value of accumulated benefits of $3.3 billion and was at least 80 percent funded. The assets of the multi-employer plan may be used to satisfy obligations of any of the employers participating in the plan. As a result, contributions made by the Company may be used to provide benefits to participants of other participating employers. Contributions for 2016, 2015 and 2014 were approximately $0.05 million, $0.03 million, and $0.06 million, respectively. Contributions made by the Company to the Pentegra DB Plan do not represent more than 5% of contributions made to the Pentegra DB Plan. The assumed health care cost trend rate used in the post-retirement health plan at December 31, 2016 was 7.50% for the pre-65 participants and 5.80% for the post-65 participants for medical costs and 10.5% for prescription drugs. The rate to which the cost trend rate is assumed to decline (the ultimate trend rate) and the year that the rate reaches the ultimate trend rate is 3.89% and 2075, respectively. Assumed health care cost trend rates impact the amounts reported for the health care plan. A one-percentage-point increase or decrease in the trend rate would increase the service and interest cost components by nominal amounts. 401(k) Employee Stock Ownership Plan The Company has a 401(k) Employee Stock Ownership Plan in which employees can contribute from 1% to 90% of eligible compensation, with the first 3% being eligible for a 100% matching contribution in the form of Company common stock and the next 3% being eligible for a 50% matching contributions in the form of Company common stock. The expense recognized under this plan for the years ended December 31, 2016, 2015 and 2014 was $4.3 million, $3.6 million, and $3.4 million, respectively. Effective January 1, 2010, the defined benefit pension plan was modified to a new plan design that includes an interest credit contribution to be made to the 401(k) plan. The expense recognized for this interest credit contribution for the years ended December 31, 2016, 2015, and 2014 was $0.7 million, $1.1 million, and $0.9 million, respectively. The Company acquired the Oneida Savings Bank 401(k) Savings Plan and the Oneida Savings Bank Employee Stock Ownership Plan with the Oneida acquisition. Effective January 26, 2016, the Oneida Savings Bank 401(k) Savings Plan was merged into and became part of the Community Bank System, Inc. 401(k) Employee Stock Ownership Plan, and effective March 16, 2016, the Oneida Savings Bank Employee Stock Ownership plan was merged into and became part of the Community Bank System, Inc. 401(k) Employee Stock Ownership Plan. Other Deferred Compensation Arrangements In addition to the supplemental pension plans for certain executives, the Company has nonqualified deferred compensation arrangements for several former directors, officers and key employees. All benefits provided under these plans are unfunded and payments to plan participants are made by the Company. At December 31, 2016 and 2015, the Company has recorded a liability of $3.2 million and $3.6 million, respectively. The expense recognized under these plans for the years ended December 31, 2016, 2015, and 2014 was approximately $0.03 million, $0.1 million, and $0.3 million, respectively. Deferred Compensation Plan for Directors Directors may defer all or a portion of their director fees under the Deferred Compensation Plan for Directors. Under this plan, there is a separate account for each participating director which is credited with the amount of shares that could have been purchased with the director’s fees as well as any dividends on such shares. On the distribution date, the director will receive common stock equal to the accumulated share balance in their account. As of December 31, 2016 and 2015, there were 154,013 and 151,672 shares credited to the participants’ accounts, for which a liability of $4.0 million and $3.8 million was accrued, respectively. The expense recognized under the plan for the years ended December 31, 2016, 2015 and 2014, was $0.2 million, $0.2 million, and $0.2 million, respectively. |
STOCK-BASED COMPENSATION PLANS |
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STOCK-BASED COMPENSATION PLANS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
STOCK-BASED COMPENSATION PLANS | NOTE L: STOCK-BASED COMPENSATION PLANS The Company has a long-term incentive program for directors, officers and employees. Under this program, the Company initially authorized four million shares of Company common stock for the grant of incentive stock options, nonqualified stock options, restricted stock awards, and retroactive stock appreciation rights. The long-term incentive program was amended effective May 25, 2011 and May 14, 2014 to authorize an additional 900,000 shares and 1,000,000 shares of Company common stock, respectively, for the grant of incentive stock options, nonqualified stock options, restricted stock awards, and retroactive stock appreciation rights. As of December 31, 2016, the Company has authorization to grant up to approximately 0.9 million additional shares of Company common stock for these instruments. The nonqualified (offset) stock options in its Director’s Stock Balance Plan vest and become exercisable immediately and expire one year after the date the director retires or two years in the event of death. The remaining options have a ten-year term, and vest and become exercisable on a grant-by-grant basis, ranging from immediate vesting to ratably over a five-year period. Activity in this long-term incentive program is as follows:
The following table summarizes the information about stock options outstanding under the Company’s stock option plan at December 31, 2016:
The weighted-average remaining contractual term of outstanding and exercisable stock options at December 31, 2016 is 6.28 years and 4.89 years, respectively. The aggregate intrinsic value of outstanding and exercisable stock options at December 31, 2016 is $54.3 million and $33.4 million, respectively. The Company recognized stock-based compensation expense related to incentive and non-qualified stock options of $2.2 million, $1.8 million and $2.0 million for the years ended December 31, 2016, 2015 and 2014, respectively. A related income tax benefit was recognized of $0.8 million, $0.7 million and $0.9 million for the 2016, 2015 and 2014 years, respectively. Compensation expense related to restricted stock vesting recognized in the income statement for 2016, 2015 and 2014 was approximately $2.4 million, $2.2 million and $2.0 million, respectively. Management estimated the fair value of options granted using the Black-Scholes option-pricing model. This model was originally developed to estimate the fair value of exchange-traded equity options, which (unlike employee stock options) have no vesting period or transferability restrictions. As a result, the Black-Scholes model is not necessarily a precise indicator of the value of an option, but it is commonly used for this purpose. The Black-Scholes model requires several assumptions, which management developed based on historical trends and current market observations.
Unrecognized stock-based compensation expense related to non-vested stock options totaled $4.4 million at December 31, 2016. The weighted-average period over which this unrecognized expense would be recognized is 3.2 years. The total fair value of stock options vested during 2016, 2015, and 2014 were $2.1 million, $1.9 million and $1.9 million, respectively. During the 12 months ended December 31, 2016 and 2015, proceeds from stock option exercises totaled $12.0 million and $10.4 million, respectively, and the related tax benefits from exercise were approximately $2.7 million and $2.1 million, respectively. During the twelve months ended December 31, 2016 and 2015, approximately 0.4 million shares were issued in connection with stock option exercises each year. The total intrinsic value of options exercised during 2016, 2015 and 2014 were $10.3 million, $7.6 million and $5.7 million, respectively. A summary of the status of the Company’s unvested restricted stock awards as of December 31, 2016, and changes during the twelve months ended December 31, 2016 and 2015, is presented below:
Unrecognized stock-based compensation expense related to unvested restricted stock totaled $5.7 million at December 31, 2016, which will be recognized as expense over the next five years. The weighted-average period over which this unrecognized expense would be recognized is 4.7 years. The total fair value of restricted stock vested during 2016, 2015, and 2014 were $2.5 million, $1.7 million and $1.6 million, respectively. |
EARNINGS PER SHARE |
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EARNINGS PER SHARE [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
EARNINGS PER SHARE | NOTE M: EARNINGS PER SHARE The two class method is used in the calculations of basic and diluted earnings per share. Under the two class method, earnings available to common shareholders for the period are allocated between common shareholders and participating securities according to dividends declared and participation rights in undistributed earnings. The Company has determined that all of its outstanding non-vested stock awards are participating securities as of December 31, 2016. Basic earnings per share are computed based on the weighted-average of the common shares outstanding for the period. Diluted earnings per share are based on the weighted-average of the shares outstanding and the assumed exercise of stock options during the year. The dilutive effect of options is calculated using the treasury stock method of accounting. The treasury stock method determines the number of common shares that would be outstanding if all the dilutive options (those where the average market price is greater than the exercise price) were exercised and the proceeds were used to repurchase common shares in the open market at the average market price for the applicable time period. There were approximately 0.3 million, 0.3 million and 0.2 million weighted-average anti-dilutive stock options outstanding at December 31, 2016, 2015 and 2014, respectively, which were not included in the computation below. The following is a reconciliation of basic to diluted earnings per share for the years ended December 31, 2016, 2015 and 2014.
Stock Repurchase Program At its December 2015 meeting, the Board approved a stock repurchase program authorizing the repurchase of up to 2.2 million shares of the Company’s common stock, in accordance with securities laws and regulations, through December 31, 2016. At its December 2016 meeting, the Board approved a similar program for 2017, authorizing the repurchase of up to 2.2 million shares of the Company’s common stock through December 31, 2017. Any repurchased shares will be used for general corporate purposes, including those related to stock plan activities. The timing and extent of repurchases will depend on market conditions and other corporate considerations as determined at the Company’s discretion. There were no stock repurchases pursuant to the announced plan in 2016. During 2015 and 2014, the Company repurchased approximately 0.3 million and 0.1 million, respectively, shares of its common stock in open market transactions. |
COMMITMENTS, CONTINGENT LIABILITIES AND RESTRICTIONS |
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COMMITMENTS, CONTINGENT LIABILITIES AND RESTRICTIONS [Abstract] | |||||||||||||||||||||||||||||||||||||
COMMITMENTS, CONTINGENT LIABILITIES AND RESTRICTIONS | NOTE N: COMMITMENTS, CONTINGENT LIABILITIES AND RESTRICTIONS The Company is a party to financial instruments with off-balance-sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments consist primarily of commitments to extend credit and standby letters of credit. Commitments to extend credit are agreements to lend to customers, generally having fixed expiration dates or other termination clauses that may require payment of a fee. These commitments consist principally of unused commercial and consumer credit lines. Standby letters of credit generally are contingent upon the failure of the customer to perform according to the terms of an underlying contract with a third party. The credit risks associated with commitments to extend credit and standby letters of credit are essentially the same as that involved with extending loans to customers and are subject to the Company’s normal credit policies. Collateral may be obtained based on management’s assessment of the customer’s creditworthiness. The fair value of the standby letters of credit is immaterial for disclosure. The contract amounts of commitments and contingencies are as follows at December 31:
The Company has unused lines of credit of $25.0 million at December 31, 2016. The Company has unused borrowing capacity of approximately $1.2 billion through collateralized transactions with the FHLB and $26.0 million through collateralized transactions with the Federal Reserve. The Company is required to maintain a reserve balance, as established by the Federal Reserve Bank. The required average total reserve for the 14-day maintenance period of December 22, 2016 through January 4, 2017 was $82.8 million, with $64.9 million represented by cash on hand and the remaining $17.9 million was required to be on deposit with the Federal Reserve. The Company and its subsidiaries are subject in the normal course of business to various pending and threatened legal proceedings in which claims for monetary damages are asserted. As of December 31, 2016, management, after consultation with legal counsel, does not anticipate that the aggregate ultimate liability arising out of litigation pending or threatened against the Company or its subsidiaries will be material to the Company’s consolidated financial position. On at least a quarterly basis the Company assesses its liabilities and contingencies in connection with such legal proceedings. For those matters where it is probable that the Company will incur losses and the amounts of the losses can be reasonably estimated, the Company records an expense and corresponding liability in its consolidated financial statements. To the extent the pending or threatened litigation could result in exposure in excess of that liability, the amount of such excess is not currently estimable. The range of reasonably possible losses for matters where an exposure is not currently estimable or considered probable, beyond the existing recorded liabilities, is between $0 and $1 million in the aggregate. Although the Company does not believe that the outcome of pending litigation will be material to the Company’s consolidated financial position, it cannot rule out the possibility that such outcomes will be material to the consolidated results of operations for a particular reporting period in the future. |
LEASES |
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LEASES [Abstract] | ||||||||||||||||||||||||||||||||||||
LEASES | NOTE O: LEASES The Company leases buildings, office space, and equipment under agreements that expire in various years. Rental expense included in operating expenses amounted to $5.8 million, $5.4 million and $5.3 million in 2016, 2015 and 2014, respectively. The future minimum rental commitments as of December 31, 2016 for all non-cancelable operating leases are as follows:
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REGULATORY MATTERS |
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REGULATORY MATTERS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
REGULATORY MATTERS | NOTE P: REGULATORY MATTERS The Company and the Bank are subject to various regulatory capital requirements administered by federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and the Bank must meet specific capital guidelines that involve quantitative measures of the Company’s and the Bank’s assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices. The Company’s and the Bank's capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Management believes, as of December 31, 2016, that the Company and Bank meet all applicable capital adequacy requirements. Basel III Transitional rules became effective for the Company on January 1, 2015 with all of the requirements being phased in over a multi-year schedule, and fully phased in by January 1, 2019. Beginning in 2016, the Company and the Bank are required to maintain a “capital conservation buffer,” composed entirely of common equity Tier 1 capital, in addition to minimum risk-based capital ratios. The required capital conservation buffer for 2016 is 0.625%. Therefore, to satisfy both the minimum risk-based capital ratios and the capital conservation buffer in 2016, the Company and the Bank must maintain: (i) Common equity Tier 1 capital to total risk-weighted assets of at least 5.125%, (ii) Tier 1 capital to total risk-weighted assets of at least 6.625%, and (iii) Total capital (Tier 1 capital plus Tier 2 capital) to total risk-weighted assets of at least 8.625%. As of December 31, 2016 and 2015, the amounts, ratios and requirements for the Company are presented below calculated under the Basel III Standardized Transitional Approach. As of December 31, 2016, the most recent notification from the OCC categorized the Company and Bank as “well capitalized” under the regulatory framework for prompt corrective action.
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PARENT COMPANY STATEMENTS | NOTE Q: PARENT COMPANY STATEMENTS The condensed balance sheets of the parent company at December 31 are as follows:
The condensed statements of income of the parent company for the years ended December 31 is as follows:
The statements of cash flows of the parent company for the years ended December 31 is as follows:
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FAIR VALUE |
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FAIR VALUE [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FAIR VALUE | NOTE R: FAIR VALUE Accounting standards allow entities an irrevocable option to measure certain financial assets and financial liabilities at fair value. Unrealized gains and losses on items for which the fair value option has been elected are reported in earnings. The Company has elected to value mortgage loans held for sale at fair value in order to more closely match the gains and losses associated with loans held for sale with the gains and losses on forward sales contracts. Accordingly, the impact on the valuation will be recognized in the Company’s consolidated statement of income. All mortgage loans held for sale are current and in performing status. Accounting standards establish a framework for measuring fair value and require certain disclosures about such fair value instruments. It defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (i.e. exit price). Inputs used to measure fair value are classified into the following hierarchy:
A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The following tables set forth the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis. There were no transfers between any of the levels for the periods presented.
The valuation techniques used to measure fair value for the items in the table above are as follows:
The changes in Level 3 assets measured at fair value on a recurring basis are summarized in the following tables:
Assets and liabilities measured on a non-recurring basis:
Loans are generally not recorded at fair value on a recurring basis. Periodically, the Company records nonrecurring adjustments to the carrying value of loans based on fair value measurements for partial charge-offs of the uncollectible portions of those loans. Nonrecurring adjustments also include certain impairment amounts for collateral-dependent loans calculated when establishing the allowance for credit losses. Such amounts are generally based on the fair value of the underlying collateral supporting the loan and, as a result, the carrying value of the loan less the calculated valuation amount does not necessarily represent the fair value of the loan. Real estate collateral is typically valued using independent appraisals or other indications of value based on recent comparable sales of similar properties or assumptions generally observable in the marketplace, adjusted for non-observable inputs. Thus, the resulting nonrecurring fair value measurements are generally classified as Level 3. Estimates of fair value used for other collateral supporting commercial loans generally are based on assumptions not observable in the marketplace and, therefore, such valuations classify as Level 3. At December 31, 2016, there were two impaired loans recorded at the fair value of the underlying collateral. Other real estate owned (“OREO”) is valued at the time the loan is foreclosed upon and the asset is transferred to OREO. The value is based primarily on third party appraisals, less estimated costs to sell. The appraisals are sometimes further discounted based on management’s historical knowledge, changes in market conditions from the time of valuation, and/or management’s expertise and knowledge of the customer and customer’s business. Such discounts are significant, ranging from 9% to 97% at December 31, 2016, and result in a Level 3 classification of the inputs for determining fair value. OREO is reviewed and evaluated on at least a quarterly basis for additional impairment and adjusted accordingly, based on the same factors identified above. The Company recovers the carrying value of OREO through the sale of the property. The ability to affect future sales prices is subject to market conditions and factors beyond the Company’s control and may impact the estimated fair value of a property. Originated mortgage servicing rights are recorded at their fair value at the time of sale of the underlying loan, and are amortized in proportion to and over the estimated period of net servicing income. The fair value of mortgage servicing rights is based on a valuation model incorporating inputs that market participants would use in estimating future net servicing income. Such inputs include estimates of the cost of servicing loans, appropriate discount rate, and prepayment speeds and are considered to be unobservable and contribute to the Level 3 classification of mortgage servicing rights. In accordance with GAAP, the Company must record impairment charges, on a nonrecurring basis, when the carrying value of a stratum exceeds its estimated fair value. Impairment is recognized through a valuation allowance. There is no valuation allowance at December 31, 2016 as the fair value of mortgage servicing rights of approximately $1.9 million exceeded the carrying value of approximately $1.4 million. The Company evaluates goodwill for impairment on an annual basis, or more often if events or circumstances indicate there may be impairment. The fair value of each reporting unit is compared to the carrying amount of that reporting unit in order to determine if impairment is indicated. If so, the implied fair value of the reporting unit’s goodwill is compared to its carrying amount and the impairment loss is measured by the excess of the carrying value of the goodwill over fair value of the goodwill. In such situations, the Company performs a discounted cash flow modeling technique that requires management to make estimates regarding the amount and timing of expected future cash flows of the assets and liabilities of the reporting unit that enable the Company to calculate the implied fair value of the goodwill. It also requires use of a discount rate that reflects the current return expectation of the market in relation to present risk-free interest rates, expected equity market premiums, peer volatility indicators and company-specific risk indicators. The Company did not recognize an impairment charge during 2016 or 2015. The significant unobservable inputs used in the determination of fair value of assets classified as Level 3 on a recurring or non-recurring basis as of December 31, 2016 are as follows:
The significant unobservable inputs used in the determination of fair value of assets classified as Level 3 on a recurring or non-recurring basis as of December 31, 2015 are as follows:
The Company determines fair values based on quoted market values, where available, estimates of present values, or other valuation techniques. Those techniques are significantly affected by the assumptions used, including, but not limited to, the discount rate and estimates of future cash flows. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, may not be realized in immediate settlement of the instrument. Certain financial instruments and all nonfinancial instruments are excluded from fair value disclosure requirements. Accordingly, the aggregate fair value amounts presented do not represent the underlying value of the Company. The carrying amounts and estimated fair values of the Company’s other financial instruments that are not accounted for at fair value at December 31, 2016 and 2015 are as follows:
The following is a further description of the principal valuation methods used by the Company to estimate the fair values of its financial instruments. Loans have been classified as a Level 3 valuation. Fair values for variable rate loans that reprice frequently are based on carrying values. Fair values for fixed rate loans are estimated using discounted cash flows and interest rates currently being offered for loans with similar terms to borrowers of similar credit quality. Deposits have been classified as a Level 2 valuation. The fair value of demand deposits, interest-bearing checking deposits, savings accounts and money market deposits is the amount payable on demand at the reporting date. The fair value of time deposit obligations are based on current market rates for similar products. Borrowings have been classified as a Level 2 valuation. The fair value of FHLB overnight advances is the amount payable on demand at the reporting date. Fair values for long-term borrowings are estimated using discounted cash flows and interest rates currently being offered on similar borrowings, and are immaterial as of the reporting dates. Subordinated debt held by unconsolidated subsidiary trusts have been classified as a Level 2 valuation. The fair value of subordinated debt held by unconsolidated subsidiary trusts are estimated using discounted cash flows and interest rates currently being offered on similar securities. Other financial assets and liabilities – Cash and cash equivalents have been classified as a Level 1 valuation, while accrued interest receivable and accrued interest payable have been classified as a Level 2 valuation. The fair values of each approximate the respective carrying values because the instruments are payable on demand or have short-term maturities and present relatively low credit risk and interest rate risk. |
DERIVATIVE INSTRUMENTS |
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Dec. 31, 2016 | |
DERIVATIVE INSTRUMENTS [Abstract] | |
DERIVATIVE INSTRUMENTS | NOTE S: DERIVATIVE INSTRUMENTS The Company is party to derivative financial instruments in the normal course of its business to meet the financing needs of its customers and to manage its own exposure to fluctuations in interest rates. These financial instruments have been limited to commitments to originate real estate loans held for sale and forward sales commitments. The Company does not hold or issue derivative financial instruments for trading or other speculative purposes. The Company enters into forward sales commitments for the future delivery of residential mortgage loans, and interest rate lock commitments to fund loans at a specified interest rate. The forward sales commitments are utilized to reduce interest rate risk associated with interest rate lock commitments and loans held for sale. Changes in the estimated fair value of the forward sales commitments and interest rate lock commitments subsequent to inception are based on changes in the fair value of the underlying loan resulting from the fulfillment of the commitment and changes in the probability that the loan will fund within the terms of the commitment, which is affected primarily by changes in interest rates and the passage of time. At inception and during the life of the interest rate lock commitment, the Company includes the expected net future cash flows related to the associated servicing of the loan as part of the fair value measurement of the interest rate lock commitments. These derivatives are recorded at fair value, which were immaterial at December 31, 2016. The effect of the changes to these derivatives for the year then ended was also immaterial. |
VARIABLE INTEREST ENTITIES |
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VARIABLE INTEREST ENTITIES | NOTE T: VARIABLE INTEREST ENTITIES The Company’s wholly-owned subsidiaries, Community Statutory Trust III and Community Capital Trust IV, are VIEs for which the Company is not the primary beneficiary. Accordingly, the accounts of these entities are not included in the Company’s consolidated financial statements. See further information regarding Community Statutory Trust III and Community Capital Trust IV in Note H: Borrowings. In connection with the Company’s acquisition of Oneida, the Company acquired OPFC II which holds a 50% membership interest in 706 North Clinton, LLC (“706 North Clinton”), an entity formed for the purpose of acquiring and rehabilitating real property. The real property held by 706 North Clinton is principally occupied by subsidiaries of the Company. The Company analyzed the operating agreement and capital structure of 706 North Clinton and determined that it was the primary beneficiary and therefore should consolidate 706 North Clinton in its financial statements. This conclusion was based on the determination that the Company has a de facto agency relationship because of the financing arrangement between the other member of 706 North Clinton and the Bank which provides OPFC II with both the power to direct the activities of 706 North Clinton and the obligation to absorb any losses of 706 North Clinton. The carrying amount of the assets and liabilities of 706 North Clinton and the classification of these assets and liabilities in the Company’s Consolidated Statements of Financial Condition at December 31 is as follows:
In addition to the assets and liabilities of 706 North Clinton, the minority interest in 706 North Clinton of $3.23 million at December 31, 2016 is included in the Company’s Consolidated Statement of Financial Condition. The creditors of 706 North Clinton do not have a claim on the general assets of the Company. The Company’s maximum loss exposure net of minority interest in 706 North Clinton is approximately $4.8 million as of December 31, 2016, including a $1.6 million loss exposure related to the financing agreement between the other member of 706 North Clinton and the Bank. |
SEGMENT INFORMATION |
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SEGMENT INFORMATION [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEGMENT INFORMATION | NOTE U: SEGMENT INFORMATION Operating segments are components of an enterprise, which are evaluated regularly by the “chief operating decision maker” in deciding how to allocate resources and assess performance. The Company’s chief operating decision maker is the President and Chief Executive Officer of the Company. The Company has identified Banking, Employee Benefit Services and All Other as its reportable operating business segments. CBNA operates the Banking segment that provides full-service banking to consumers, businesses, and governmental units in northern, central, and western New York as well as northeast Pennsylvania. Employee Benefit Services, which includes BPA, BPAS-APS (formerly Harbridge Consulting Group, LLC), BPAS Trust Company of Puerto Rico and HB&T, provides employee benefit trust, collective investment fund, retirement plan administration, actuarial, VEBA/HRA, and health and welfare consulting services. The All Other segment is comprised of; (a) wealth management services including trust services provided by the personal trust unit within the Bank, broker-dealer and investment advisory services provided by CISI, OWM, and The Carta Group, and asset management provided by Nottingham, and (b) full-service insurance, risk management and employee benefit services provided by OneGroup. The accounting policies used in the disclosure of business segments are the same as those described in the summary of significant accounting policies (See Note A). Information about reportable segments and reconciliation of the information to the consolidated financial statements follows:
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SUBSEQUENT EVENTS |
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Dec. 31, 2016 | |
SUBSEQUENT EVENTS [Abstract] | |
SUBSEQUENT EVENTS | NOTE V: SUBSEQUENT EVENTS Companies are required to evaluate events and transactions that occur after the balance sheet date but before the date the financial statements are issued, or available to be issued in the case of non-public entities. They must recognize in the financial statements the effect of all events or transactions that provide additional evidence of conditions that existed at the balance sheet date, including the estimates inherent in the financial preparation process. Entities do not recognize the impact of events or transactions that provide evidence about conditions that did not exist at the balance sheet date but arose after that date. On February 3, 2017, the Company completed its acquisition of Northeast Retirement Services, Inc. (“NRS”) and its subsidiary Global Trust Company (“GTC”) headquartered in Woburn, Massachusetts for approximately $148 million in Company stock and cash. NRS was a privately held corporation focused on providing institutional transfer agency, master recordkeeping services, custom target date fund administration, trust product administration and customized reporting services to institutional clients. Its wholly-owned subsidiary, GTC, was chartered in the State of Maine in 2008, as a non-depository trust company which provides fiduciary services for collective investment trusts and other products. The acquisition will strengthen and complement the Company’s existing employee benefit services businesses. Upon the completion of the merger, NRS is a wholly-owned subsidiary of BPAS and will operate as Northeast Retirement Services, LLC, a Delaware limited liability company. The initial accounting for the assets and liabilities assumed with this acquisition is incomplete as of the date of issuance of the financial statements due to the proximity of the acquisition date to the date of issuance. |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) |
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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |||||||
Nature of Operations | Nature of Operations Community Bank System, Inc. (the “Company”) is a registered financial holding company which wholly-owns two significant consolidated subsidiaries: Community Bank, N.A. (the “Bank” or “CBNA”), and Benefit Plans Administrative Services, Inc. (“BPAS”). As of December 31, 2016, BPAS owns four subsidiaries: Benefit Plans Administrative Services, LLC (“BPA”), a provider of defined benefit contribution plan administration services; BPAS Actuarial & Pension Services, LLC (“BPAS-APS”) (formally known as Harbridge Consulting Group, LLC), a provider of actuarial and benefit consulting services; BPAS Trust Company of Puerto Rico, a Puerto Rican trust company; and Hand Benefits & Trust Company (“HB&T”), a provider of collective investment fund administration and institutional trust services. HB&T owns one subsidiary, Hand Securities Inc. (“HSI”), an introducing broker-dealer. The Company also wholly-owns two unconsolidated subsidiary business trusts formed for the purpose of issuing mandatorily-redeemable preferred securities which are considered Tier I capital under regulatory capital adequacy guidelines (see Note P). As of December 31, 2016, the Bank operated 193 full service branches under the Community Bank, N.A. name throughout 35 counties of Upstate New York and six counties of Northeastern Pennsylvania offering a range of commercial and retail banking services. The Bank owns the following operating subsidiaries: The Carta Group, Inc. (“Carta Group”), CBNA Preferred Funding Corporation (“PFC”), CBNA Treasury Management Corporation (“TMC”), Community Investment Services, Inc. (“CISI”), Nottingham Advisors, Inc. (“Nottingham”), OneGroup NY, Inc. (“OneGroup”), Oneida Wealth Management, Inc. (“OWM”), and Oneida Preferred Funding II LLC (“OPFC II”). OneGroup is a full-service insurance agency offering personal and commercial property insurance and other risk management products and services. On August 19, 2016, the Company merged its insurance subsidiary CBNA Insurance Agency, Inc. (“CBNA Insurance”) into OneGroup. PFC and OPFC II primarily act as investors in residential real estate loans and properties. TMC provides cash management, investment, and treasury services to the Bank. CISI, The Carta Group and OWM provide broker-dealer and investment advisory services. On April 22, 2016, the Company merged the activities of OWM into CISI. Nottingham provides asset management services to individuals, corporations, corporate pension and profit sharing plans, and foundations. |
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Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Variable Interest Entities (“VIE”) are legal entities in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the legal entities to finance its activities without additional subordinated financial support. VIEs may be required to be consolidated by a company if it is determined the company is the primary beneficiary of a VIE. The primary beneficiary of a VIE is the enterprise that has: (1) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance, and (2) the obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits of the VIE that could potentially be significant to the VIE. The Company’s VIE’s are described in more detail in Note T to the consolidated financial statements. |
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Critical Accounting Estimates in the Preparation of Financial Statements | Critical Accounting Estimates in the Preparation of Financial Statements The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Critical accounting estimates include the allowance for loan losses, actuarial assumptions associated with the pension, post-retirement and other employee benefit plans, the provision for income taxes, investment valuation and other-than-temporary impairment, the carrying value of goodwill and other intangible assets, and acquired loan valuations. |
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Risk and Uncertainties | Risk and Uncertainties In the normal course of its business, the Company encounters economic and regulatory risks. There are three main components of economic risk: interest rate risk, credit risk and market risk. The Company is subject to interest rate risk to the degree that its interest-bearing liabilities mature or reprice at different speeds, or on different basis, from its interest-earning assets. The Company’s primary credit risk is the risk of default on the Company’s loan portfolio that results from the borrowers’ inability or unwillingness to make contractually required payments. Market risk reflects potential changes in the value of collateral underlying loans, the fair value of investment securities, and loans held for sale. The Company is subject to regulations of various governmental agencies. These regulations can change significantly from period to period. The Company also undergoes periodic examinations by the regulatory agencies which may subject it to further changes with respect to asset valuations, amounts of required loan loss allowances, and operating restrictions resulting from the regulators’ judgments based on information available to them at the time of their examinations. |
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Revenue Recognition | Revenue Recognition The Company recognizes income on an accrual basis. CISI, OWM and Carta Group recognize fee income when investment and insurance products are sold to customers. Nottingham provides asset management services to brokerage firms and clients and recognizes income ratably over the contract period during which service is performed. Revenue from BPA’s administration and recordkeeping services is recognized ratably over the service contract period. Revenue from consulting and actuarial services is recognized when services are rendered. OneGroup recognizes commission revenue at the later of the effective date of the insurance policy, or the date on which the policy premium is billed to the customer. At that date, the earnings process has been completed and the impact of refunds for policy cancellations can be reasonably estimated to establish reserves. The reserve for policy cancellations is based upon historical cancellation experience adjusted for known circumstances. All intercompany revenue and expense among related entities are eliminated in consolidation. |
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Cash and Cash Equivalents | Cash and Cash Equivalents For purposes of reporting cash flows, cash and cash equivalents include cash on hand, amounts due from banks, and highly liquid investments with original maturities of less than 90 days. The carrying amounts reported in the balance sheet for cash and cash equivalents approximate those assets’ fair values. |
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Investment Securities | Investment Securities The Company can classify its investments in debt and equity securities as trading, held-to-maturity, or available-for-sale. Held-to-maturity securities are those for which the Company has the positive intent and ability to hold until maturity, and are reported at amortized cost. The Company did not use the held-to-maturity classification in 2015 or 2016. Securities classified as available-for-sale are reported at fair value with net unrealized gains and losses reflected as a separate component of shareholders' equity, net of applicable income taxes. None of the Company's investment securities have been classified as trading securities at December 31, 2016. Certain equity securities are stated at cost and include restricted stock of the Federal Reserve Bank of New York (“Federal Reserve”) and Federal Home Loan Bank of New York (“FHLB”). Fair values for investment securities are based upon quoted market prices, where available. If quoted market prices are not available, fair values are based upon quoted market prices of comparable instruments, or a discounted cash flow model using market estimates of interest rates and volatility. The Company conducts an assessment of all securities in an unrealized loss position to determine if other-than-temporary impairment (“OTTI”) exists on a quarterly basis. An unrealized loss exists when the current fair value of an individual security is less than its amortized cost basis. The OTTI assessment considers the security structure, recent security collateral performance metrics, if applicable, external credit ratings, failure of the issuer to make scheduled interest or principal payments, judgment about and expectations of future performance, and relevant independent industry research, analysis, and forecasts. The severity of the impairment and the length of time the security has been impaired is also considered in the assessment. The assessment of whether an OTTI decline exists is performed on each security, regardless of the classification of the security as available-for-sale or held-to-maturity, and involves a high degree of subjectivity and judgment that is based on the information available to management at a point in time. An OTTI loss must be recognized for a debt security in an unrealized loss position if there is intent to sell the security or it is more likely than not the Company will be required to sell the security prior to recovery of its amortized cost basis. In this situation, the amount of loss recognized in income is equal to the difference between the fair value and the amortized cost basis of the security. Even if management does not have the intent, and it is not more likely than not that the Company will be required to sell the securities, an evaluation of the expected cash flows to be received is performed to determine if a credit loss has occurred. For debt securities, a critical component of the evaluation for OTTI is the identification of credit-impaired securities, where the Company does not expect to receive cash flows sufficient to recover the entire amortized cost basis of the security. In the event of a credit loss, only the amount of impairment associated with the credit loss would be recognized in income. The portion of the unrealized loss relating to other factors, such as liquidity conditions in the market or changes in market interest rates, is recorded in accumulated other comprehensive loss. Equity securities are also evaluated to determine whether the unrealized loss is expected to be recoverable based on whether evidence exists to support a realizable value equal to or greater than the amortized cost basis. If it is probable that the amortized cost basis will not be recovered, taking into consideration the estimated recovery period and the ability to hold the equity security until recovery, OTTI is recognized in earnings equal to the difference between the fair value and the amortized cost basis of the security. The specific identification method is used in determining the realized gains and losses on sales of investment securities and OTTI charges. Premiums and discounts on securities are amortized and accreted, respectively, on the interest method basis over the period to maturity or estimated life of the related security. Purchases and sales of securities are recognized on a trade date basis. |
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Loans | Loans Loans are stated at unpaid principal balances, net of unearned income. Mortgage loans held for sale are carried at fair value and are included in loans held for sale on the balance sheet. Fair values for variable rate loans that reprice frequently are based on carrying values. Fair values for fixed rate loans are estimated using discounted cash flows and interest rates currently being offered for loans with similar terms to borrowers of similar credit quality. The carrying amount of accrued interest approximates its fair value. Interest on loans is accrued and credited to operations based upon the principal amount outstanding. Nonrefundable loan fees and related direct costs are deferred and included in the loan balances where they are amortized over the life of the loan as an adjustment to loan yield using the effective yield method. Premiums and discounts on purchased loans are amortized using the effective yield method over the life of the loans. |
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Acquired Loans | Acquired loans Acquired loans are initially recorded at their acquisition date fair values. The carryover of allowance for loan losses is prohibited as any credit losses in the loans are included in the determination of the fair value of the loans at the acquisition date. Fair values for acquired loans are based on a discounted cash flow methodology that involves assumptions and judgments as to credit risk, prepayment risk, liquidity risk, default rates, loss severity, payment speeds, collateral values and discount rate. Acquired impaired loans Acquired loans that have evidence of deterioration in credit quality since origination and for which it is probable, at acquisition, that the Company will be unable to collect all contractually required payments are accounted for as impaired loans under ASC 310-30. The excess of undiscounted cash flows expected at acquisition over the estimated fair value is referred to as the accretable discount and is recognized into interest income over the remaining life of the loans using the interest method. The difference between contractually required payments at acquisition and the undiscounted cash flows expected to be collected at acquisition is referred to as the non-accretable discount. The non-accretable discount represents estimated future credit losses and other contractually required payments that the Company does not expect to collect. Subsequent decreases in expected cash flows are recognized as impairments through a charge to the provision for credit losses resulting in an increase in the allowance for loan losses. Subsequent improvements in expected cash flows result in a recovery of previously recorded allowance for loan losses or a reversal of a corresponding amount of the non-accretable discount, which the Company then reclassifies as an accretable discount that is recognized into interest income over the remaining life of the loans using the interest method. Acquired loans that met the criteria for non-accrual of interest prior to acquisition may be considered performing upon acquisition, regardless of whether the customer is contractually delinquent, if the Company can reasonably estimate the timing and amount of the expected cash flows on such loans and if the Company expects to fully collect the new carrying value of the loans. As such, the Company may no longer consider the loan to be non-accrual or non-performing and may accrue interest on these loans, including the impact of any accretable discount. Acquired non-impaired loans Acquired loans that do not meet the requirements under ASC 310-30 are considered acquired non-impaired loans. The difference between the acquisition date fair value and the outstanding balance represents the fair value adjustment for a loan and includes both credit and interest rate considerations. Fair value adjustments may be discounts (or premiums) to a loan’s cost basis and are accreted (or amortized) to net interest income (or expense) over the loan’s remaining life in accordance with ASC 310-20. Fair value adjustments for revolving loans are accreted (or amortized) using a straight line method. Term loans are accreted (or amortized) using the constant effective yield method. Subsequent to the purchase date, the methods used to estimate the allowance for loan losses for the acquired non-impaired loans is consistent with the policy described below. However, the Company compares the net realizable value of the loans to the carrying value, for loans collectively evaluated for impairment. The carrying value represents the net of the loan’s unpaid principal balance and the remaining purchase discount (or premium) that has yet to be accreted (or amortized) into interest income (or interest expense). When the carrying value exceeds the net realizable value, an allowance for loan losses is recognized. |
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Impaired and Other Nonaccrual Loans | Impaired and Other Nonaccrual Loans The Company places a loan on nonaccrual status when the loan becomes 90 days past due (or sooner, if management concludes collection is doubtful), except when, in the opinion of management, it is well-collateralized and in the process of collection. A loan may be placed on nonaccrual status earlier than ninety days past due if there is deterioration in the financial position of the borrower or if other conditions of the loan so warrant. When a loan is placed on nonaccrual status, uncollected accrued interest is reversed against interest income and the amortization of nonrefundable loan fees and related direct costs is discontinued. Interest income during the period the loan is on nonaccrual status is recorded on a cash basis after recovery of principal is reasonably assured. Nonaccrual loans are returned to accrual status when management determines that the borrower’s performance has improved and that both principal and interest are collectible. This generally requires a sustained period of timely principal and interest payments and a well-documented credit evaluation of the borrower’s financial condition. A loan is considered modified in a troubled debt restructuring (“TDR”) when, due to a borrower’s financial difficulties, the Company makes a concession(s) to the borrower that it would not otherwise consider. These modifications may include, among others, an extension for the term of the loan, or granting a period when interest–only payments can be made with the principal payments and interest caught up over the remaining term of the loan or at maturity. Generally, a nonaccrual loan that has been modified in a TDR remains on nonaccrual status for a period of 12 months to demonstrate that the borrower is able to meet the terms of the modified loan. If the borrower’s ability to meet the revised payment schedule is uncertain, the loan remains on nonaccrual status. Regulatory guidance issued by the OCC requires certain loans that have been discharged in Chapter 7 bankruptcy to be reported as TDRs. In accordance with this new guidance, loans that have been discharged in Chapter 7 bankruptcy but not reaffirmed by the borrower are classified as TDRs, irrespective of payment history or delinquency status, even if the repayment terms for the loan have not been otherwise modified and the Company’s lien position against the underlying collateral remains unchanged. Pursuant to that guidance, the Company records a charge-off equal to any portion of the carrying value that exceeds the net realizable value of the collateral. Commercial loans greater than $0.5 million are evaluated individually for impairment. A loan is considered impaired, based on current information and events, if it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. The measurement of impaired loans is generally based upon the present value of expected future cash flows or the fair value of the collateral, if the loan is collateral-dependent. The Company’s charge-off policy by loan type is as follows:
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Allowance for Loan Losses | Allowance for Loan Losses Management continually evaluates the credit quality of the Company’s loan portfolio, and performs a formal review of the adequacy of the allowance for loan losses on a quarterly basis. The allowance reflects management’s best estimate of probable losses inherent in the loan portfolio. Determination of the allowance is subjective in nature and requires significant estimates. The Company’s allowance methodology consists of two broad components - general and specific loan loss allocations. The general loan loss allocation is composed of two calculations that are computed on five main loan segments: business lending, consumer installment - direct, consumer installment - indirect, home equity and consumer mortgage. The first calculation is quantitative and determines an allowance level based on the latest 36 months of historical net charge-off data for each loan class (commercial loans exclude balances with specific loan loss allocations). The second calculation is qualitative and takes into consideration eight qualitative environmental factors: levels and trends in delinquencies and impaired loans; levels of and trends in charge-offs and recoveries; trends in volume and terms of loans; effects of any changes in risk selection and underwriting standards, and other changes in lending policies, procedures, and practices; experience, ability, and depth of lending management and other relevant staff; national and local economic trends and conditions; industry conditions; and effects of changes in credit concentrations. A component of the qualitative calculation is the unallocated allowance for loan loss. The qualitative and quantitative calculations are added together to determine the general loan loss allocation. The specific loan loss allocation relates to individual commercial loans that are both greater than $0.5 million and in a nonaccruing status with respect to interest. Specific loan losses are based on discounted estimated cash flows, including any cash flows resulting from the conversion of collateral or collateral shortfalls. The allowance levels computed from the specific and general loan loss allocation methods are combined with unallocated allowances and allowances needed for acquired loans to derive the total required allowance for loan losses to be reflected on the Consolidated Statement of Condition. Loan losses are charged off against the allowance, while recoveries of amounts previously charged off are credited to the allowance. A provision for loan losses is charged to operations based on management’s periodic evaluation of factors previously mentioned. |
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Intangible Assets | Intangible Assets Intangible assets include core deposit intangibles, customer relationship intangibles and goodwill arising from acquisitions. Core deposit intangibles and customer relationship intangibles are amortized on either an accelerated or straight-line basis over periods ranging from seven to 20 years. The initial and ongoing carrying value of goodwill and other intangible assets is based upon discounted cash flow modeling techniques that require management to make estimates regarding the amount and timing of expected future cash flows. It also requires use of a discount rate that reflects the current return requirements of the market in relation to present risk-free interest rates, required equity market premiums, peer volatility indicators, and company-specific risk indicators. The Company evaluates goodwill for impairment on an annual basis, or more often if events or circumstances indicate there may be impairment. The implied fair value of a reporting unit’s goodwill is compared to its carrying amount and the impairment loss is measured by the excess of the carrying value over fair value. The fair value of each reporting unit is compared to the carrying amount of that reporting unit in order to determine if impairment is indicated. |
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Premises and Equipment | Premises and Equipment Premises and equipment are stated at cost less accumulated depreciation. Computer software costs that are capitalized only include external direct costs of obtaining and installing the software. The Company has not developed any internal use software. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets. Useful lives range from three to 10 years for equipment; three to seven years for software and hardware; and 10 to 40 years for building and building improvements. Land improvements are depreciated over 20 years and leasehold improvements are amortized over the shorter of the term of the respective lease plus any optional renewal periods that are reasonably assured or life of the asset. Maintenance and repairs are charged to expense as incurred. |
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Other Real Estate | Other Real Estate Other real estate owned is comprised of properties acquired through foreclosure, or by deed in lieu of foreclosure. These assets are carried at fair value less estimated costs of disposal. At foreclosure, if the fair value, less estimated costs to sell, of the real estate acquired is less than the Company’s recorded investment in the related loan, a write-down is recognized through a charge to the allowance for loan losses. Any subsequent reduction in value is recognized by a charge to income. Operating costs associated with the properties are charged to expense as incurred. At December 31, 2016 and 2015, other real estate amounted to $2.0 million and $2.1 million, respectively, and is included in other assets. |
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Mortgage Servicing Rights | Mortgage Servicing Rights Originated mortgage servicing rights are recorded at their fair value at the time of sale of the underlying loan, and are amortized in proportion to and over the period of estimated net servicing income or loss. The Company uses a valuation model that calculates the present value of future cash flows to determine the fair value of servicing rights. In using this valuation method, the Company incorporates assumptions that market participants would use in estimating future net servicing income, which includes estimates of the servicing cost per loan, the discount rate, and prepayment speeds. The carrying value of the originated mortgage servicing rights is included in other assets and is evaluated quarterly for impairment using these same market assumptions. The amount of impairment recognized is the amount by which the carrying value of the capitalized servicing rights for a stratum exceeds estimated fair value. Impairment is recognized through a valuation allowance. |
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Treasury Stock | Treasury Stock Repurchases of shares of the Company’s common stock are recorded at cost as a reduction of shareholders’ equity. Reissuance of shares of treasury stock is recorded at average cost. |
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Income Taxes | Income Taxes The Company and its subsidiaries file a consolidated federal income tax return. Provisions for income taxes are based on taxes currently payable or refundable as well as deferred taxes that are based on temporary differences between the tax basis of assets and liabilities and their reported amounts in the financial statements. Deferred tax assets and liabilities are reported in the financial statements at currently enacted income tax rates applicable to the period in which the deferred tax assets and liabilities are expected to be realized or settled. Benefits from tax positions should be recognized in the financial statements only when it is more likely than not that the tax position will be sustained upon examination by the appropriate taxing authority having full knowledge of all relevant information. A tax position meeting the more-likely-than-not recognition threshold should be measured at the largest amount of benefit for which the likelihood of realization upon ultimate settlement exceeds 50 percent. |
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Retirement Benefits | Retirement Benefits The Company provides defined benefit pension benefits to eligible employees and post-retirement health and life insurance benefits to certain eligible retirees. The Company also provides deferred compensation and supplemental executive retirement plans for selected current and former employees, officers, and directors. Expense under these plans is charged to current operations and consists of several components of net periodic benefit cost based on various actuarial assumptions regarding future experience under the plans, including discount rate, rate of future compensation increases and expected return on plan assets. |
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Assets Under Management or Administration | Assets Under Management or Administration Assets held in fiduciary or agency capacities for customers are not included in the accompanying consolidated statements of condition as they are not assets of the Company. All fees associated with providing asset management services are recorded on an accrual basis of accounting and are included in noninterest income. |
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Advertising | Advertising Advertising costs amounting to approximately $3.9 million, $3.6 million and $3.2 million for the years ending December 31, 2016, 2015 and 2014, respectively, are nondirect response in nature and expensed as incurred. |
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Earnings Per Share | Earnings Per Share Using the two-class method, basic earnings per common share is computed based upon net income available to common shareholders divided by the weighted average number of common shares outstanding during each period, which excludes the outstanding unvested restricted stock. Diluted earnings per share is computed using the weighted average number of common shares determined for the basic earnings per common share computation plus the dilutive effect of stock options using the treasury stock method. Stock options where the exercise price is greater than the average market price of common shares were not included in the computation of earnings per diluted share as they would have been anti-dilutive. |
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Stock-based Compensation | Stock-based Compensation Companies are required to measure and record compensation expense for stock options and other share-based payments on the instruments’ fair value on the date of grant. Stock-based compensation expense is recognized ratably over the requisite service period for all awards (see Note L). |
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Fair Values of Financial Instruments | Fair Values of Financial Instruments The Company determines fair values based on quoted market values where available or on estimates using present values or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, could not be realized in immediate settlement of the instrument. Certain financial instruments and all nonfinancial instruments are excluded from this disclosure requirement. Accordingly, the aggregate fair value amounts presented do not represent the underlying value of the Company. The fair values of investment securities, loans, deposits, and borrowings have been disclosed in Note R. |
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Reclassifications | Reclassifications Certain reclassifications have been made to prior years’ balances to conform to the current year presentation. |
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New Accounting Pronouncements | New Accounting Pronouncements In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606). This new guidance supersedes the revenue recognition requirements in ASC 605, Revenue Recognition, and is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects consideration to which the entity expects to be entitled in exchange for those goods and services. The ASU also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. This guidance is effective for the Company for annual and interim periods beginning after December 15, 2017, and should be applied either retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying this guidance recognized at the date of initial application. The Company’s implementation efforts include the identification of revenue within the scope of the guidance, as well as evaluation of revenue contracts. The Company’s review is ongoing, and the Company will continue to evaluate any impact as additional guidance is issued and as our internal assessment progresses. In January 2016, the FASB issued ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. This guidance addresses certain aspects of recognition, measurement, presentation and disclosure of financial instruments. The primary focus of this guidance is to supersede the guidance to classify equity securities with readily determinable fair values into different categories (trading or available-for-sale) and requires equity securities to be measured at fair value with changes in the fair value recognized through net income. This guidance requires adoption through a cumulative-effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption. This ASU is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption is permitted for all companies in any interim or annual period. The Company is currently evaluating the effect the guidance will have on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). This new guidance supersedes the lease requirements in Topic 840, Leases and is based on the principle that a lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. The accounting applied by a lessor is largely unchanged from that applied under the previous guidance. In addition, the guidance requires an entity to separate the lease components from the nonlease components in a contract. The ASU requires disclosures about the amount, timing, and judgments related to a reporting entity’s accounting for leases and related cash flows. The standard is required to be applied to all leases in existence as of the date of adoption using a modified retrospective transition approach. This guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted for all companies in any interim or annual period. The Company occupies certain offices and uses certain equipment under non-cancelable operating lease agreements, which currently are not reflected in its consolidated statement of condition. The Company expects to recognize lease liabilities and right of use assets associated with these lease agreements; however, the extent of the impact on the Company’s consolidated financial statements is currently under evaluation. In March 2016, the FASB issued ASU 2016-09, Compensation – Stock Compensation (Topic 718). The amendments simplify several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. The new guidance requires all excess tax benefits and tax deficiencies be recognized as income tax expense or benefit in the income statement. The tax effects of exercised or vested awards should be treated as discrete items in the reporting period in which they occur. This guidance requires certain amendments to be applied through a cumulative-effect adjustment to equity as of the beginning of the fiscal period in which the guidance is adopted while other amendments are required to be applied retrospectively or prospectively. This ASU is effective for fiscal periods beginning after December 15, 2016, and interim periods within those annual periods. The Company expects adoption of the guidance will result in increased volatility to reported income tax expense related to excess tax benefits and tax deficiencies for share-based payment transactions; however, the actual amounts recognized in tax expense will be dependent on the amount of share-based transactions entered into and the Company’s stock price on the date of exercise or vesting. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326). This new guidance significantly changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. This ASU will replace the “incurred loss” model under existing guidance with an “expected loss” model for instruments measured at amortized cost, and require entities to record allowances for available-for-sale debt securities rather than reduce the carrying amount, as they do today under the other-than-temporary impairment model. This ASU also simplifies the accounting model for purchased credit-impaired debt securities and loans. This guidance requires adoption through a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. This ASU is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for all companies as of fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company is currently evaluating the impact the guidance will have on the Company’s consolidated financial statements, and expects an increase in the allowance for credit losses resulting from the change to expected losses for the estimated life of the financial asset, including an allowance for debt securities. The amount of the increase in the allowance for credit losses resulting from the new guidance will be impacted by the portfolio composition and asset quality at the adoption date, as well as economic conditions and forecasts at the time of adoption. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230). The amendments provide guidance on the following eight specific cash flow issues: 1) debt prepayment or debt extinguishment costs; 2) settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing; 3) contingent consideration payments made after a business combination; 4) proceeds from the settlement of insurance claims; 5) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies; 6) distributions received from equity method investees; 7) beneficial interests in securitization transactions; and 8) separately identifiable cash flows and application of the predominance principle. This ASU is effective for fiscal years beginning after December 31, 2017, including interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. As this guidance only affects the classification within the statement of cash flows, this ASU is not expected to have a material impact on the Company’s consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other (Topic 350). The amendments simplify how an entity is required to test goodwill for impairment by eliminating the requirement to measure a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. Instead, an entity will perform its goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount, and recognize an impairment charge for the amount by which the carrying amount of the reporting unit exceeds its fair value. Impairment loss recognized under this new guidance will be limited to the goodwill allocated to the reporting unit. This ASU is effective prospectively for the Company for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. This ASU is not expected to have a material impact on the Company’s consolidated financial statements. |
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Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ACQUISITIONS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Estimated Fair Value of Assets Acquired and Liabilities Assumed | The following table summarizes the estimated fair value of the assets acquired and liabilities assumed.
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Summary of Loans Acquired | The following is a summary of the loans acquired from Oneida at the date of acquisition:
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Pro Forma Financial Information | The pro forma information set forth below reflects adjustments related to (a) certain purchase accounting fair value adjustments; and (b) amortization of customer lists and core deposit intangibles. Expenses totaling $14.0 million related to conversion of systems and other costs of integration, as well as certain one-time costs, are excluded from the pro forma year ended December 31, 2015 and were included in the pro forma year ended December 31, 2014.
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INVESTMENT SECURITIES (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVESTMENT SECURITIES [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Amortized Cost and Estimated Fair Value of Investment Securities | The amortized cost and estimated fair value of investment securities as of December 31 are as follows:
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Summary of Investment Securities That Have Been in a Continuous Unrealized Loss Position for Less Than or Greater Than Twelve Months | A summary of investment securities that have been in a continuous unrealized loss position for less than or greater than twelve months is as follows: As of December 31, 2016
As of December 31, 2015
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Amortized Cost and Estimated Fair Value of Debt Securities by Contractual Maturity | The amortized cost and estimated fair value of debt securities at December 31, 2016, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately.
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Cash Flow Information on Investment Securities | Cash flow information on investment securities for the years ended December 31 is as follows:
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LOANS (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Loans Receivable, Net | The balances of these classes at December 31 are summarized as follows:
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Summary of Aggregate Amounts Loaned to Related Parties | Following is a summary of the aggregate amount of such loans during 2016 and 2015.
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Outstanding Principal Balance and Related Carrying Amount of Acquired Loans | The outstanding principal balance and the related carrying amount of acquired loans included in the Consolidated Statement of Condition at December 31 are as follows:
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Schedule of Accretable Discount Related to Credit Impaired Acquired Loans | The changes in the accretable discount related to the credit impaired acquired loans are as follows:
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Aged Analysis of Past Due Loans by Class | The following is an aged analysis of the Company’s past due loans by class as of December 31, 2016: Legacy Loans (excludes loans acquired after January 1, 2009)
Acquired Loans (includes loans acquired after January 1, 2009)
The following is an aged analysis of the Company’s past due loans by class as of December 31, 2015: Legacy Loans (excludes loans acquired after January 1, 2009)
Acquired Loans (includes loans acquired after January 1, 2009)
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Summary of Non-Business Impaired Loans | A summary of individually evaluated impaired loans as of December 31, 2016 and 2015 is as follows:
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Troubled Debt Restructurings on Financing Receivables | Information regarding TDRs as of December 31, 2016 and December 31, 2015 is as follows
The following table presents information related to loans modified in a TDR during the years ended December 31, 2016 and 2015. Of the loans noted in the table below, all loans for the years ended December 31, 2016 and December 31, 2015, were modified due to a Chapter 7 bankruptcy as described previously. The financial effects of these restructurings were immaterial.
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Schedule of Allowance for Loan Losses by Class | The following presents by class the activity in the allowance for loan losses:
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Business Lending [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Loans by Credit Quality Indicator | The following table shows the amount of business lending loans by credit quality category:
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All Other Loans [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Loans by Credit Quality Indicator | The following tables detail the balances in all loan categories except for business lending at December 31, 2016: Legacy loans (excludes loans acquired after January 1, 2009)
Acquired loans (includes loans acquired after January 1, 2009)
The following table details the balances in all other loan categories at December 31, 2015: Legacy loans (excludes loans acquired after January 1, 2009)
Acquired loans (includes loans acquired after January 1, 2009)
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PREMISES AND EQUIPMENT (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PREMISES AND EQUIPMENT [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Premises and Equipment | Premises and equipment consist of the following at December 31:
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GOODWILL AND IDENTIFIABLE INTANGIBLE ASSETS (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
GOODWILL AND IDENTIFIABLE INTANGIBLE ASSETS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Gross Carrying Amount and Accumulated Amortization for Each Type of Identifiable Intangible Asset | The gross carrying amount and accumulated amortization for each type of identifiable intangible asset are as follows:
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Estimated Aggregate Amortization Expense | The estimated aggregate amortization expense for each of the five succeeding fiscal years ended December 31 is as follows:
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Components of Goodwill | Shown below are the components of the Company’s goodwill at December 31, 2016 and 2015:
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Changes in Carrying Value of MSRs and Associated Valuation Allowance | The following table summarizes the changes in carrying value of MSRs and the associated valuation allowance:
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Summary of Key Economic Assumptions Used to Estimate Value of MSRs | The following table summarizes the key economic assumptions used to estimate the value of the MSRs at December 31:
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DEPOSITS (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DEPOSITS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Deposits | Deposits consist of the following at December 31:
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Maturities of Time Deposits | The approximate maturities of time deposits at December 31, 2016 are as follows:
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BORROWINGS (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||
BORROWINGS [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||
Outstanding Borrowings | Outstanding borrowings at December 31 are as follows:
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Borrowings by Contractual Maturity Dates | Borrowings at December 31, 2016 have contractual maturity dates as follows:
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Terms of Preferred Securities | The terms of the preferred securities of each trust are as follows:
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INCOME TAXES (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INCOME TAXES [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Provision for Income Taxes | The provision for income taxes for the years ended December 31 is as follows:
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Components of Net Deferred Tax Liability | Components of the net deferred tax liability, included in other liabilities, as of December 31 are as follows:
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Reconciliation of Differences between Federal Statutory Income Tax Rate and Effective Tax Rate | A reconciliation of the differences between the federal statutory income tax rate and the effective tax rate for the years ended December 31 is shown in the following table:
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Reconciliation of Unrecognized Tax Benefits | A reconciliation of the unrecognized tax benefits for the years ended December 31 is shown in the following table:
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BENEFIT PLANS (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
BENEFIT PLANS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Funded Status of Plans Reconciled with Amounts Reported in Consolidated Statements of Condition | Using a measurement date of December 31, the following table shows the funded status of the Company's plans reconciled with amounts reported in the Company's consolidated statements of condition:
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Amounts Recognized in Accumulated Other Comprehensive Income, Net of Tax | Amounts recognized in accumulated other comprehensive income, net of tax, for the year ended December 31, are as follows:
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Estimated Costs, Net of Tax, That Will Be Amortized from Accumulated Other Comprehensive (Income) Loss into Net Periodic (Income) Cost over Next Fiscal Year | The estimated costs, net of tax, that will be amortized from accumulated other comprehensive (income) loss into net periodic (income) cost over the next fiscal year are as follows:
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Weighted-Average Assumptions Used to Determine Benefit Obligations | The weighted-average assumptions used to determine the benefit obligations as of December 31 are as follows:
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Net Periodic Benefit Cost | The net periodic benefit cost as of December 31 is as follows:
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Weighted-Average Assumptions Used to Determine Net Periodic Pension Cost | The weighted-average assumptions used to determine the net periodic pension cost for the years ended December 31 are as follows:
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Amount of Expected Benefit Payments | The amount of benefit payments that are expected to be paid over the next ten years are as follows:
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Fair Value of Defined Benefit Plan Assets by Asset Category | The fair values of the Company’s defined benefit pension plan assets at December 31, 2016 by asset category are as follows:
The fair values of the Company’s defined benefit pension plan assets at December 31, 2015 by asset category are as follows:
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STOCK-BASED COMPENSATION PLANS (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
STOCK-BASED COMPENSATION PLANS [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Activity in Long-Term Incentive Program | Activity in this long-term incentive program is as follows:
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Summary of Information about Stock Options Outstanding under Stock Option Plan | The following table summarizes the information about stock options outstanding under the Company’s stock option plan at December 31, 2016:
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Summary of Valuation Assumptions Used to Estimate Value of Stock Options | The Black-Scholes model requires several assumptions, which management developed based on historical trends and current market observations.
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Activity of Unvested Restricted Stock Awards | A summary of the status of the Company’s unvested restricted stock awards as of December 31, 2016, and changes during the twelve months ended December 31, 2016 and 2015, is presented below:
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EARNINGS PER SHARE (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
EARNINGS PER SHARE [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of Basic to Diluted Earnings per Share | The following is a reconciliation of basic to diluted earnings per share for the years ended December 31, 2016, 2015 and 2014.
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COMMITMENTS, CONTINGENT LIABILITIES AND RESTRICTIONS (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||
COMMITMENTS, CONTINGENT LIABILITIES AND RESTRICTIONS [Abstract] | |||||||||||||||||||||||||||||||||||||
Off Balance Sheet Financial Instruments Contract Amounts | The contract amounts of commitments and contingencies are as follows at December 31:
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LEASES (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | ||||||||||||||||||||||||||||||||||||
LEASES [Abstract] | ||||||||||||||||||||||||||||||||||||
Future Minimum Rental Commitments | The future minimum rental commitments as of December 31, 2016 for all non-cancelable operating leases are as follows:
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REGULATORY MATTERS (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
REGULATORY MATTERS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Capital Ratios and Amounts | As of December 31, 2016, the most recent notification from the OCC categorized the Company and Bank as “well capitalized” under the regulatory framework for prompt corrective action.
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PARENT COMPANY STATEMENTS (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PARENT COMPANY STATEMENTS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Condensed Balance Sheets of Parent Company | The condensed balance sheets of the parent company at December 31 are as follows:
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Condensed Statements of Income of Parent Company | The condensed statements of income of the parent company for the years ended December 31 is as follows:
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Statements of Cash Flows of Parent Company | The statements of cash flows of the parent company for the years ended December 31 is as follows:
|
FAIR VALUE (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FAIR VALUE [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Fair Value Measured on a Recurring Basis | There were no transfers between any of the levels for the periods presented.
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Changes in Level 3 Assets Measured at Fair Value on a Recurring Basis | The changes in Level 3 assets measured at fair value on a recurring basis are summarized in the following tables:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Assets and Liabilities Measured on a Non-Recurring Basis | Assets and liabilities measured on a non-recurring basis:
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Significant Unobservable Inputs, Fair Value Valuation Techniques | The significant unobservable inputs used in the determination of fair value of assets classified as Level 3 on a recurring or non-recurring basis as of December 31, 2016 are as follows:
The significant unobservable inputs used in the determination of fair value of assets classified as Level 3 on a recurring or non-recurring basis as of December 31, 2015 are as follows:
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Carrying Amounts and Estimated Fair Values of Other Financial Instruments | The carrying amounts and estimated fair values of the Company’s other financial instruments that are not accounted for at fair value at December 31, 2016 and 2015 are as follows:
|
VARIABLE INTEREST ENTITIES (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
VARIABLE INTEREST ENTITIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Carrying Amount and Classification of Assets and Liabilities of 706 North Clinton | The carrying amount of the assets and liabilities of 706 North Clinton and the classification of these assets and liabilities in the Company’s Consolidated Statements of Financial Condition at December 31 is as follows:
|
SEGMENT INFORMATION (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEGMENT INFORMATION [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Segment Reporting Information by Segment | Information about reportable segments and reconciliation of the information to the consolidated financial statements follows:
|
ACQUISITIONS, Supplemental Pro Forma Financial Information (Details) - USD ($) $ in Thousands |
1 Months Ended | 12 Months Ended | |
---|---|---|---|
Dec. 31, 2015 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Supplemental Pro Forma Financial Information [Abstract] | |||
Expenses related to conversion of systems and other costs of integration, as well as certain one-time costs | $ 14,000 | ||
Total revenue, net of interest expense, actual | $ 3,667 | ||
Net income (loss), actual | $ (3,905) | ||
Total revenue, net of interest expense, pro forma | 426,541 | $ 416,713 | |
Net income (loss), pro forma | $ 96,894 | $ 85,665 |
INVESTMENT SECURITIES, Cash Flow Information on Investment Securities (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Cash flow information on investment securities [Abstract] | |||
Gross gains on sales of investment securities | $ 0 | $ 3 | $ 0 |
Gross losses on sales of investment securities | 0 | 7 | $ 0 |
Investment securities pledged to collateralize certain deposits and borrowings | $ 1,865,000 | $ 1,750,000 |
LOANS, Acquired Loans (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Credit impaired acquired loans [Abstract] | ||
Outstanding principal balance | $ 6,354 | $ 8,339 |
Carrying amount | 5,553 | 7,299 |
Credit impaired acquired loans, total balance due | 6,600 | 8,500 |
Non-impaired acquired loans [Abstract] | ||
Outstanding principal balance | 497,308 | 620,942 |
Carrying amount | 489,807 | 610,355 |
Total acquired loans [Abstract] | ||
Outstanding principal balance | 503,662 | 629,281 |
Carrying amount | 495,360 | 617,654 |
Accretable discount related to acquired loans [Roll forward] | ||
Balance at beginning of year | 810 | 705 |
Oneida acquisition | 0 | 341 |
Accretion recognized | (455) | (552) |
Net reclassification to accretable from nonaccretable | 143 | 316 |
Balance at end of year | $ 498 | $ 810 |
LOANS, Amount of Business Lending Loans by Credit Quality Category (Details) - USD ($) $ in Thousands |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | $ 4,948,562 | $ 4,801,375 |
Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 4,453,202 | 4,183,721 |
Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 495,360 | 617,654 |
Business Lending [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 1,490,076 | 1,497,271 |
Business Lending [Member] | Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 1,277,666 | 1,233,628 |
Business Lending [Member] | Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 212,410 | 263,643 |
Business Lending [Member] | Pass [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 1,213,170 | 1,267,738 |
Business Lending [Member] | Pass [Member] | Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 1,051,005 | 1,048,364 |
Business Lending [Member] | Pass [Member] | Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 162,165 | 219,374 |
Business Lending [Member] | Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 165,292 | 144,775 |
Business Lending [Member] | Special Mention [Member] | Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 135,602 | 124,768 |
Business Lending [Member] | Special Mention [Member] | Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 29,690 | 20,007 |
Business Lending [Member] | Classified [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 105,587 | 77,144 |
Business Lending [Member] | Classified [Member] | Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 90,585 | 60,181 |
Business Lending [Member] | Classified [Member] | Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 15,002 | 16,963 |
Business Lending [Member] | Doubtful [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 474 | 315 |
Business Lending [Member] | Doubtful [Member] | Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 474 | 315 |
Business Lending [Member] | Doubtful [Member] | Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 0 | 0 |
Business Lending [Member] | Acquired Impaired [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 5,553 | 7,299 |
Business Lending [Member] | Acquired Impaired [Member] | Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 0 | 0 |
Business Lending [Member] | Acquired Impaired [Member] | Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 5,553 | 7,299 |
All Other Loans [Member] | Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 3,175,536 | 2,950,093 |
All Other Loans [Member] | Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 282,950 | 354,011 |
All Other Loans [Member] | Performing [Member] | Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 3,160,929 | 2,934,994 |
All Other Loans [Member] | Performing [Member] | Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 279,070 | 351,880 |
All Other Loans [Member] | Nonperforming [Member] | Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 14,607 | 15,099 |
All Other Loans [Member] | Nonperforming [Member] | Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 3,880 | 2,131 |
Consumer Mortgage [Member] | Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 1,659,760 | 1,581,458 |
Consumer Mortgage [Member] | Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 159,941 | 188,296 |
Consumer Mortgage [Member] | Performing [Member] | Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 1,647,228 | 1,568,653 |
Consumer Mortgage [Member] | Performing [Member] | Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 157,404 | 186,506 |
Consumer Mortgage [Member] | Nonperforming [Member] | Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 12,532 | 12,805 |
Consumer Mortgage [Member] | Nonperforming [Member] | Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 2,537 | 1,790 |
Consumer Indirect [Member] | Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 1,014,825 | 890,339 |
Consumer Indirect [Member] | Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 30,147 | 45,421 |
Consumer Indirect [Member] | Performing [Member] | Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 1,014,659 | 890,237 |
Consumer Indirect [Member] | Performing [Member] | Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 30,144 | 45,421 |
Consumer Indirect [Member] | Nonperforming [Member] | Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 166 | 102 |
Consumer Indirect [Member] | Nonperforming [Member] | Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 3 | 0 |
Consumer Direct [Member] | Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 181,922 | 178,051 |
Consumer Direct [Member] | Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 9,893 | 17,025 |
Consumer Direct [Member] | Performing [Member] | Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 181,864 | 177,999 |
Consumer Direct [Member] | Performing [Member] | Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 9,893 | 17,011 |
Consumer Direct [Member] | Nonperforming [Member] | Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 58 | 52 |
Consumer Direct [Member] | Nonperforming [Member] | Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 0 | 14 |
Home Equity [Member] | Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 319,029 | 300,245 |
Home Equity [Member] | Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 82,969 | 103,269 |
Home Equity [Member] | Performing [Member] | Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 317,178 | 298,105 |
Home Equity [Member] | Performing [Member] | Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 81,629 | 102,942 |
Home Equity [Member] | Nonperforming [Member] | Legacy Loan [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | 1,851 | 2,140 |
Home Equity [Member] | Nonperforming [Member] | Acquired Loans [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans | $ 1,340 | $ 327 |
LOANS, Summary of Impaired Loans, Excluding Purchased Impaired (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Impaired loans [Abstract] | ||
Loans with allowance allocation | $ 1,109 | $ 0 |
Loans without allowance allocation | 556 | 2,376 |
Unpaid principal balance | 1,665 | 2,376 |
Contractual balance | 3,340 | 3,419 |
Allowance for loan loss allocated | 477 | 0 |
Average impaired loans | 4,683 | 2,922 |
Interest income recognized | $ 0 | $ 0 |
LOANS, Troubled Debt Restructuring (TDR) (Details) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2016
USD ($)
Loan
|
Dec. 31, 2015
USD ($)
Loan
|
|
Financing Receivable, Modifications [Line Items] | ||
TDRs, number | Loan | 214 | 238 |
TDRs, amount | $ 5,530 | $ 6,144 |
Loans modified in TDR during the year, number | Loan | 48 | 71 |
Loans modified in TDR during the year, amount | $ 1,157 | $ 1,864 |
Maximum [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Threshold balance of TDR loans collectively included in general loan loss allocation and qualitative review | $ 500 | |
Nonaccrual [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
TDRs, number | Loan | 56 | 55 |
TDRs, amount | $ 1,832 | $ 1,892 |
Accruing [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
TDRs, number | Loan | 158 | 183 |
TDRs, amount | $ 3,698 | $ 4,252 |
Residential Portfolio Segment [Member] | Consumer Mortgage [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
TDRs, number | Loan | 81 | 91 |
TDRs, amount | $ 3,476 | $ 3,958 |
Loans modified in TDR during the year, number | Loan | 9 | 21 |
Loans modified in TDR during the year, amount | $ 597 | $ 1,374 |
Residential Portfolio Segment [Member] | Consumer Mortgage [Member] | Nonaccrual [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
TDRs, number | Loan | 36 | 37 |
TDRs, amount | $ 1,520 | $ 1,472 |
Residential Portfolio Segment [Member] | Consumer Mortgage [Member] | Accruing [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
TDRs, number | Loan | 45 | 54 |
TDRs, amount | $ 1,956 | $ 2,486 |
Commercial Portfolio Segment [Member] | Minimum [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Threshold balance of loan individually evaluated for impairment | $ 500 | |
Commercial Portfolio Segment [Member] | Business Lending [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
TDRs, number | Loan | 11 | 14 |
TDRs, amount | $ 781 | $ 954 |
Loans modified in TDR during the year, number | Loan | 0 | 3 |
Loans modified in TDR during the year, amount | $ 0 | $ 67 |
Commercial Portfolio Segment [Member] | Business Lending [Member] | Nonaccrual [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
TDRs, number | Loan | 6 | 8 |
TDRs, amount | $ 91 | $ 217 |
Commercial Portfolio Segment [Member] | Business Lending [Member] | Accruing [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
TDRs, number | Loan | 5 | 6 |
TDRs, amount | $ 690 | $ 737 |
Consumer Portfolio Segment [Member] | Consumer Indirect [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
TDRs, number | Loan | 78 | 77 |
TDRs, amount | $ 771 | $ 691 |
Loans modified in TDR during the year, number | Loan | 33 | 35 |
Loans modified in TDR during the year, amount | $ 459 | $ 349 |
Consumer Portfolio Segment [Member] | Consumer Indirect [Member] | Nonaccrual [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
TDRs, number | Loan | 0 | 0 |
TDRs, amount | $ 0 | $ 0 |
Consumer Portfolio Segment [Member] | Consumer Indirect [Member] | Accruing [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
TDRs, number | Loan | 78 | 77 |
TDRs, amount | $ 771 | $ 691 |
Consumer Portfolio Segment [Member] | Consumer Direct [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
TDRs, number | Loan | 23 | 32 |
TDRs, amount | $ 65 | $ 37 |
Loans modified in TDR during the year, number | Loan | 3 | 6 |
Loans modified in TDR during the year, amount | $ 51 | $ 11 |
Consumer Portfolio Segment [Member] | Consumer Direct [Member] | Nonaccrual [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
TDRs, number | Loan | 0 | 0 |
TDRs, amount | $ 0 | $ 0 |
Consumer Portfolio Segment [Member] | Consumer Direct [Member] | Accruing [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
TDRs, number | Loan | 23 | 32 |
TDRs, amount | $ 65 | $ 37 |
Consumer Portfolio Segment [Member] | Home Equity [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
TDRs, number | Loan | 21 | 24 |
TDRs, amount | $ 437 | $ 504 |
Loans modified in TDR during the year, number | Loan | 3 | 6 |
Loans modified in TDR during the year, amount | $ 50 | $ 63 |
Consumer Portfolio Segment [Member] | Home Equity [Member] | Nonaccrual [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
TDRs, number | Loan | 14 | 10 |
TDRs, amount | $ 221 | $ 203 |
Consumer Portfolio Segment [Member] | Home Equity [Member] | Accruing [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
TDRs, number | Loan | 7 | 14 |
TDRs, amount | $ 216 | $ 301 |
LOANS, Allowance for Loan Losses (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Allowance for loan losses [Roll Forward] | |||
Balance, beginning of period | $ 45,401 | $ 45,341 | |
Charge-offs | (12,183) | (12,071) | |
Recoveries | 5,939 | 5,684 | |
Provision | 8,076 | 6,447 | $ 7,178 |
Balance, end of period | 47,233 | 45,401 | 45,341 |
Acquired Impaired [Member] | |||
Allowance for loan losses [Roll Forward] | |||
Balance, beginning of period | 168 | 173 | |
Charge-offs | (97) | (103) | |
Recoveries | 0 | 0 | |
Provision | 37 | 98 | |
Balance, end of period | 108 | 168 | 173 |
Residential Portfolio Segment [Member] | Consumer Mortgage [Member] | |||
Allowance for loan losses [Roll Forward] | |||
Balance, beginning of period | 10,198 | 10,286 | |
Charge-offs | (647) | (1,374) | |
Recoveries | 115 | 80 | |
Provision | 428 | 1,206 | |
Balance, end of period | 10,094 | 10,198 | 10,286 |
Commercial Portfolio Segment [Member] | Business Lending [Member] | |||
Allowance for loan losses [Roll Forward] | |||
Balance, beginning of period | 15,749 | 15,787 | |
Charge-offs | (1,872) | (2,146) | |
Recoveries | 616 | 877 | |
Provision | 2,727 | 1,231 | |
Balance, end of period | 17,220 | 15,749 | 15,787 |
Consumer Portfolio Segment [Member] | Home Equity [Member] | |||
Allowance for loan losses [Roll Forward] | |||
Balance, beginning of period | 2,666 | 2,701 | |
Charge-offs | (218) | (244) | |
Recoveries | 139 | 62 | |
Provision | (188) | 147 | |
Balance, end of period | 2,399 | 2,666 | 2,701 |
Consumer Portfolio Segment [Member] | Consumer Indirect [Member] | |||
Allowance for loan losses [Roll Forward] | |||
Balance, beginning of period | 2,997 | 3,083 | |
Charge-offs | (1,706) | (1,490) | |
Recoveries | 901 | 722 | |
Provision | 787 | 682 | |
Balance, end of period | 2,979 | 2,997 | 3,083 |
Consumer Portfolio Segment [Member] | Consumer Direct [Member] | |||
Allowance for loan losses [Roll Forward] | |||
Balance, beginning of period | 12,422 | 11,544 | |
Charge-offs | (7,643) | (6,714) | |
Recoveries | 4,168 | 3,943 | |
Provision | 4,835 | 3,649 | |
Balance, end of period | 13,782 | 12,422 | 11,544 |
Unallocated Financing Receivables [Member] | |||
Allowance for loan losses [Roll Forward] | |||
Balance, beginning of period | 1,201 | 1,767 | |
Charge-offs | 0 | 0 | |
Recoveries | 0 | 0 | |
Provision | (550) | (566) | |
Balance, end of period | $ 651 | $ 1,201 | $ 1,767 |
PREMISES AND EQUIPMENT (Details) - USD ($) $ in Thousands |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | $ 219,775 | $ 214,886 |
Accumulated depreciation | (107,457) | (100,452) |
Premises and equipment, net | 112,318 | 114,434 |
Land and Land Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | 22,585 | 22,191 |
Bank Premises [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | 116,663 | 112,011 |
Equipment and Construction in Progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | $ 80,527 | $ 80,684 |
GOODWILL AND IDENTIFIABLE INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Finite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount | $ 57,541 | $ 57,253 | |
Accumulated amortization | (41,839) | (36,359) | |
Net carrying amount | 15,702 | 20,894 | |
Finite-lived intangible assets, future amortization expense [Abstract] | |||
2017 | 4,413 | ||
2018 | 3,566 | ||
2019 | 2,782 | ||
2020 | 2,119 | ||
2021 | 1,531 | ||
Thereafter | 1,291 | ||
Net carrying amount | 15,702 | 20,894 | |
Components of goodwill [Abstract] | |||
Goodwill | 469,966 | 468,076 | $ 379,998 |
Goodwill, activity | 1,890 | 88,078 | |
Accumulated impairment | (4,824) | (4,824) | (4,824) |
Accumulated impairment, activity | 0 | 0 | |
Goodwill, net | 465,142 | 463,252 | $ 375,174 |
Goodwill, net, activity | 1,890 | 88,078 | |
Servicing Asset at Fair Value, Amount [Roll Forward] | |||
Carrying value before valuation allowance at beginning of period | 1,472 | 1,089 | |
Additions | 481 | 403 | |
Oneida acquisition | 0 | 389 | |
Amortization | (518) | (409) | |
Carrying value before valuation allowance at end of period | 1,435 | 1,472 | |
Valuation allowance balance at beginning of period | 0 | 0 | |
Impairment charges | (226) | (133) | |
Impairment recoveries | 226 | 133 | |
Valuation allowance balance at end of period | 0 | 0 | |
Net carrying value at end of period | 1,435 | 1,472 | |
Fair value of MSRs at end of period | 1,928 | 1,962 | |
Principal balance of loans sold during the year | 45,852 | 35,491 | |
Principal balance of loans serviced for others | 365,374 | 377,909 | |
Custodial escrow balances maintained in connection with loans serviced for others | $ 5,603 | $ 5,700 | |
Key economic assumptions used to estimate the value of the MSRs [Abstract] | |||
Weighted-average contractual life | 20 years 9 months 18 days | 19 years 10 months 24 days | |
Weighted-average constant prepayment rate (CPR) | 15.10% | 14.90% | |
Weighted-average discount rate | 3.50% | 3.30% | |
Core Deposit Intangibles [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount | $ 39,688 | $ 39,688 | |
Accumulated amortization | (32,581) | (29,899) | |
Net carrying amount | 7,107 | 9,789 | |
Finite-lived intangible assets, future amortization expense [Abstract] | |||
Net carrying amount | 7,107 | 9,789 | |
Other Intangibles [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount | 17,853 | 17,565 | |
Accumulated amortization | (9,258) | (6,460) | |
Net carrying amount | 8,595 | 11,105 | |
Finite-lived intangible assets, future amortization expense [Abstract] | |||
Net carrying amount | $ 8,595 | $ 11,105 |
DEPOSITS (Details) - USD ($) $ in Thousands |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|
DEPOSITS [Abstract] | ||
Noninterest checking | $ 1,646,039 | $ 1,499,616 |
Interest checking | 1,644,029 | 1,575,379 |
Savings | 1,303,851 | 1,255,027 |
Money market | 1,778,907 | 1,738,904 |
Time | 703,128 | 804,548 |
Total deposits | 7,075,954 | 6,873,474 |
Maturities of time deposits [Abstract] | ||
2017 | 492,000 | |
2018 | 103,698 | |
2019 | 48,096 | |
2020 | 32,774 | |
2021 | 26,208 | |
Thereafter | 352 | |
Total | 703,128 | $ 804,548 |
Maturities of time deposits, accounts $250,000 or greater [Abstract] | ||
2017 | 42,142 | |
2018 | 1,713 | |
2019 | 2,337 | |
2020 | 2,717 | |
2021 | 2,315 | |
Thereafter | 0 | |
Total | $ 51,224 |
BORROWINGS, Outstanding Borrowings (Details) - USD ($) $ in Thousands |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|
Debt Instrument [Line Items] | ||
Total borrowings | $ 248,370 | $ 403,446 |
Subordinated debt held by unconsolidated subsidiary trust, discount | 357 | 381 |
Federal Home Loan Bank Overnight Advance [Member] | ||
Debt Instrument [Line Items] | ||
Total borrowings | 146,200 | 301,300 |
Subordinated Debt Held By Unconsolidated Subsidiary Trust [Member] | ||
Debt Instrument [Line Items] | ||
Total borrowings | $ 102,170 | $ 102,146 |
BORROWINGS, Contractual Maturity on Borrowings (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Debt Instrument [Line Items] | ||
Carrying value | $ 248,370 | $ 403,446 |
Weighted-average rate at period end | 1.70% | |
Weighted-average interest rate on borrowings during period | 1.46% | 0.82% |
Federal Home Loan Bank Overnight Advance [Member] | ||
Debt Instrument [Line Items] | ||
Carrying value | $ 146,200 | $ 301,300 |
Federal Home Loan Bank Overnight Advance [Member] | January 3, 2017 [Member] | ||
Debt Instrument [Line Items] | ||
Carrying value | $ 146,200 | |
Weighted-average rate at period end | 0.74% | |
Subordinated Debt Held By Unconsolidated Subsidiary Trust [Member] | ||
Debt Instrument [Line Items] | ||
Carrying value | $ 102,170 | $ 102,146 |
Subordinated Debt Held By Unconsolidated Subsidiary Trust [Member] | July 31, 2031 [Member] | ||
Debt Instrument [Line Items] | ||
Carrying value | $ 24,850 | |
Weighted-average rate at period end | 4.47% | |
Subordinated Debt Held By Unconsolidated Subsidiary Trust [Member] | December 15, 2036 [Member] | ||
Debt Instrument [Line Items] | ||
Carrying value | $ 77,320 | |
Weighted-average rate at period end | 2.61% |
BORROWINGS, Preferred Securities (Details) $ in Millions |
12 Months Ended |
---|---|
Dec. 31, 2016
USD ($)
Trust
| |
Debt Instrument [Line Items] | |
Number of unconsolidated subsidiary business trusts owned | Trust | 2 |
Percent ownership of unconsolidated subsidiary trusts | 100.00% |
Preferred Debt [Member] | Community Statutory Trust III [Member] | |
Terms of preferred securities for each trust [Abstract] | |
Issuance date | Jul. 31, 2001 |
Par amount | $ 24.5 |
Variable interest rate basis | 3 month LIBOR |
Variable interest rate, basis spread | 3.58% |
Effective interest rate | 4.47% |
Maturity date | Jul. 31, 2031 |
Call price | Par |
Preferred Debt [Member] | Community Capital Trust IV [Member] | |
Terms of preferred securities for each trust [Abstract] | |
Issuance date | Dec. 08, 2006 |
Par amount | $ 75.0 |
Variable interest rate basis | 3 month LIBOR |
Variable interest rate, basis spread | 1.65% |
Effective interest rate | 2.61% |
Maturity date | Dec. 15, 2036 |
Call price | Par |
INCOME TAXES, Provision for Income Taxes (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Current [Abstract] | |||
Federal | $ 32,829 | $ 27,663 | $ 30,006 |
State and other | 4,890 | 2,608 | 870 |
Deferred [Abstract] | |||
Federal | 11,444 | 9,604 | 6,867 |
State and other | 1,622 | 1,112 | 594 |
Provision for income taxes | $ 50,785 | $ 40,987 | $ 38,337 |
INCOME TAXES, Components of Net Deferred Tax Liability (Details) - USD ($) $ in Thousands |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|
Components of net deferred tax liability [Abstract] | ||
Allowance for loan losses | $ 18,366 | $ 17,791 |
Employee benefits | 6,311 | 6,633 |
Debt extinguishment | 299 | 613 |
Other, net | 5,202 | 9,704 |
Deferred tax asset | 30,178 | 34,741 |
Investment securities | 32,839 | 38,314 |
Tax-deductible goodwill | 43,504 | 39,724 |
Loan origination costs | 8,228 | 7,295 |
Depreciation | 71 | 886 |
Mortgage servicing rights | 548 | 565 |
Pension | 18,194 | 14,807 |
Deferred tax liability | 103,384 | 101,591 |
Net deferred tax liability | $ (73,206) | $ (66,850) |
INCOME TAXES, Effective Tax Rate Reconciliation (Details) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Effective tax rate reconciliation [Abstract] | |||
Federal statutory income tax rate | 35.00% | 35.00% | 35.00% |
Increase (reduction) in taxes resulting from [Abstract] | |||
Tax-exempt interest | (4.00%) | (5.00%) | (5.40%) |
State income taxes, net of federal benefit | 2.70% | 1.80% | 0.70% |
Other | (0.90%) | (0.80%) | (0.70%) |
Effective income tax rate | 32.80% | 31.00% | 29.60% |
INCOME TAXES, Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Unrecognized tax benefits [Roll forward] | |||
Unrecognized tax benefits at beginning of year | $ 127 | $ 162 | $ 138 |
Changes related to [Abstract] | |||
Positions taken during the current year | 0 | 0 | 24 |
Lapse of statutes of limitation | (35) | (35) | 0 |
Unrecognized tax benefits at end of year | 92 | $ 127 | $ 162 |
Unrecognized tax benefits that would impact effective tax rate, if recognized | $ 100 |
LIMITS ON DIVIDENDS AND OTHER REVENUE SOURCES (Details) $ in Millions |
Dec. 31, 2016
USD ($)
|
---|---|
LIMITS ON DIVIDENDS AND OTHER REVENUE SOURCES [Abstract] | |
Undivided profits legally available for the payments of dividends | $ 57.6 |
Percentage of Bank's capital and surplus that can be transferred to Company, maximum | 10.00% |
Aggregate percentage of Bank's capital and surplus that can be transferred to Company, maximum | 20.00% |
BENEFIT PLANS, Funded Status and Amounts Recognized in Balance Sheets and AOCI (Details) - USD ($) $ in Thousands |
12 Months Ended | ||||||
---|---|---|---|---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
Dec. 31, 2009 |
||||
Change in plan assets [Roll Forward] | |||||||
Fair value of plan assets at beginning of year | [1] | $ 171,625 | |||||
Fair value of plan assets at end of year | [1] | 180,086 | $ 171,625 | ||||
Amounts recognized in accumulated other comprehensive income (loss) (AOCI) [Abstract] | |||||||
AOCI at year end | 17,961 | 21,283 | $ 16,716 | ||||
Accumulated other comprehensive income (loss), negative postretirement medical plan amendment, arising during period, net of tax | $ 3,500 | ||||||
Pension Benefits [Member] | |||||||
Change in benefit obligation [Roll Forward] | |||||||
Benefit obligation at the beginning of year | 127,134 | 127,513 | |||||
Service cost | 4,106 | 3,324 | 3,530 | ||||
Interest cost | 5,624 | 5,506 | 5,271 | ||||
Plan amendment / acquisition | 22 | 2,395 | |||||
Participant contributions | 0 | 0 | |||||
Deferred actuarial (gain)/loss | (1,628) | (2,091) | |||||
Benefits paid | (8,174) | (9,513) | |||||
Benefit obligation at end of year | 127,084 | 127,134 | 127,513 | ||||
Change in plan assets [Roll Forward] | |||||||
Fair value of plan assets at beginning of year | 172,026 | 177,865 | |||||
Actual return of plan assets | 14,402 | 1,125 | |||||
Participant contributions | 0 | 0 | |||||
Employer contributions | 2,146 | 616 | |||||
Plan acquisition | 0 | 1,933 | |||||
Benefits paid | (8,174) | (9,513) | |||||
Fair value of plan assets at end of year | 180,400 | 172,026 | 177,865 | ||||
Over/(Under) funded status at year end | 53,316 | 44,892 | |||||
Amounts recognized in the consolidated statement of condition [Abstract] | |||||||
Other assets | 64,709 | 56,361 | |||||
Other liabilities | (11,393) | (11,469) | |||||
Amounts recognized in accumulated other comprehensive income (loss) (AOCI) [Abstract] | |||||||
Net loss | 28,323 | 34,016 | |||||
Net prior service cost (credit) | 2,264 | 2,307 | |||||
Pre-tax AOCI | 30,587 | 36,323 | |||||
Taxes | (11,622) | (13,815) | |||||
AOCI at year end | 18,965 | 22,508 | |||||
Post-retirement Benefits [Member] | |||||||
Change in benefit obligation [Roll Forward] | |||||||
Benefit obligation at the beginning of year | 1,918 | 2,256 | |||||
Service cost | 0 | 0 | 0 | ||||
Interest cost | 82 | 87 | 102 | ||||
Plan amendment / acquisition | 0 | 0 | |||||
Participant contributions | 516 | 509 | |||||
Deferred actuarial (gain)/loss | 174 | (45) | |||||
Benefits paid | (884) | (889) | |||||
Benefit obligation at end of year | 1,806 | 1,918 | 2,256 | ||||
Change in plan assets [Roll Forward] | |||||||
Fair value of plan assets at beginning of year | 0 | 0 | |||||
Actual return of plan assets | 0 | 0 | |||||
Participant contributions | 516 | 509 | |||||
Employer contributions | 368 | 380 | |||||
Plan acquisition | 0 | 0 | |||||
Benefits paid | (884) | (889) | |||||
Fair value of plan assets at end of year | 0 | 0 | $ 0 | ||||
Over/(Under) funded status at year end | (1,806) | (1,918) | |||||
Amounts recognized in the consolidated statement of condition [Abstract] | |||||||
Other assets | 0 | 0 | |||||
Other liabilities | (1,806) | (1,918) | |||||
Amounts recognized in accumulated other comprehensive income (loss) (AOCI) [Abstract] | |||||||
Net loss | 183 | 4 | |||||
Net prior service cost (credit) | (1,801) | (1,980) | |||||
Pre-tax AOCI | (1,618) | (1,976) | |||||
Taxes | 614 | 751 | |||||
AOCI at year end | (1,004) | (1,225) | |||||
Unfunded Supplementary Pension Plans [Member] | |||||||
Change in benefit obligation [Roll Forward] | |||||||
Benefit obligation at the beginning of year | 11,400 | ||||||
Benefit obligation at end of year | 11,300 | 11,400 | |||||
Amounts recognized in accumulated other comprehensive income (loss) (AOCI) [Abstract] | |||||||
Benefit obligation for defined benefit pension plan prior to plan revaluation | 115,700 | 115,700 | |||||
Unfunded Stock Balance [Member] | Nonemployee Directors [Member] | |||||||
Change in benefit obligation [Roll Forward] | |||||||
Benefit obligation at the beginning of year | 100 | ||||||
Benefit obligation at end of year | $ 100 | $ 100 | |||||
|
BENEFIT PLANS, Amounts Recognized in AOCI, Net of Tax (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Amounts recognized in AOCI, net of tax [Abstract] | |||
Total | $ (3,322) | $ 4,567 | $ 9,571 |
Pension Benefits [Member] | |||
Amounts recognized in AOCI, net of tax [Abstract] | |||
Prior service (credit)/cost | (26) | (5) | |
Net (gain) loss | (3,517) | 4,482 | |
Total | (3,543) | 4,477 | |
Post-retirement Benefits [Member] | |||
Amounts recognized in AOCI, net of tax [Abstract] | |||
Prior service (credit)/cost | 110 | 110 | |
Net (gain) loss | 111 | (20) | |
Total | $ 221 | $ 90 |
BENEFIT PLANS, Costs That Will Be Amortized from AOCI in Next Fiscal Year (Details) $ in Thousands |
12 Months Ended |
---|---|
Dec. 31, 2016
USD ($)
| |
Pension Benefits [Member] | |
Costs that will be amortized from accumulated other comprehensive income (loss) in net periodic (income) cost in next fiscal year [Abstract] | |
Prior service cost/(credit) | $ 55 |
Net loss | 1,010 |
Total | 1,065 |
Post-retirement Benefits [Member] | |
Costs that will be amortized from accumulated other comprehensive income (loss) in net periodic (income) cost in next fiscal year [Abstract] | |
Prior service cost/(credit) | (179) |
Net loss | 6 |
Total | $ (173) |
BENEFIT PLANS, Weighted-average Assumptions Used to Determine Benefit Obligations (Details) |
12 Months Ended | |
---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Pension Benefits [Member] | ||
Weighed average assumption used in calculating benefit obligations [Abstract] | ||
Discount rate | 4.50% | 4.70% |
Expected return on plan assets | 7.00% | 7.00% |
Rate of compensation increase | 3.50% | 3.50% |
Post-retirement Benefits [Member] | ||
Weighed average assumption used in calculating benefit obligations [Abstract] | ||
Discount rate | 4.40% | 4.70% |
BENEFIT PLANS, Net Periodic Benefit Cost (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Prior service costs [Abstract] | |||
Maximum percentage of net gain or loss over the greater of the projected benefit obligation or the market-related value of assets without requiring amortization | 10.00% | ||
Pension Benefits [Member] | |||
Net periodic benefit cost [Abstract] | |||
Service cost | $ 4,106 | $ 3,324 | $ 3,530 |
Interest cost | 5,624 | 5,506 | 5,271 |
Expected return on plan assets | (11,842) | (12,169) | (11,922) |
Plan amendment | 20 | 0 | 0 |
Amortization of unrecognized net loss/(gain) | 1,508 | 1,466 | (307) |
Amortization of prior service cost/(credit) | 43 | 8 | 5 |
Net periodic (benefit) | (541) | (1,865) | (3,423) |
Post-retirement Benefits [Member] | |||
Net periodic benefit cost [Abstract] | |||
Service cost | 0 | 0 | 0 |
Interest cost | 82 | 87 | 102 |
Expected return on plan assets | 0 | 0 | 0 |
Plan amendment | 0 | 0 | 0 |
Amortization of unrecognized net loss/(gain) | (5) | (13) | (7) |
Amortization of prior service cost/(credit) | (179) | (179) | (179) |
Net periodic (benefit) | $ (102) | $ (105) | $ (84) |
BENEFIT PLANS, Weighted-average Assumptions Used to Determine Net Periodic Benefit Cost (Details) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Pension Benefits [Member] | |||
Weighted Average Assumptions Used in Calculating Net Periodic Benefit Cost [Abstract] | |||
Discount rate | 4.70% | 4.50% | 5.00% |
Expected return on plan assets | 7.00% | 7.00% | 7.00% |
Rate of compensation increase | 3.50% | 3.50% | 3.50% |
Post-retirement Benefits [Member] | |||
Weighted Average Assumptions Used in Calculating Net Periodic Benefit Cost [Abstract] | |||
Discount rate | 4.70% | 4.50% | 4.80% |
BENEFIT PLANS, Estimated Future Benefit Payments (Details) $ in Thousands |
Dec. 31, 2016
USD ($)
|
---|---|
Pension Benefits [Member] | |
Estimated Future Benefit Payments [Abstract] | |
2017 | $ 7,225 |
2018 | 7,320 |
2019 | 7,504 |
2020 | 7,752 |
2021 | 7,914 |
2022-2026 | 41,823 |
Post-retirement Benefits [Member] | |
Estimated Future Benefit Payments [Abstract] | |
2017 | 145 |
2018 | 143 |
2019 | 141 |
2020 | 138 |
2021 | 136 |
2022-2026 | $ 636 |
BENEFIT PLANS, Target Plan Assets Allocation (Details) |
12 Months Ended |
---|---|
Dec. 31, 2016 | |
Equity Securities [Member] | |
Plan Assets [Abstract] | |
Target allocation percentage of assets | 60.00% |
Fixed Income Securities [Member] | |
Plan Assets [Abstract] | |
Target allocation percentage of assets | 40.00% |
BENEFIT PLANS, Fair Value of Plan Assets by Assets Category (Details) - USD ($) $ in Thousands |
2 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 01, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | [1] | $ 180,086 | $ 171,625 | ||||||||
Total dividends and interest receivable excluded from plan assets | 300 | 400 | |||||||||
Quoted Prices in Active Markets For Identical Assets, Level 1 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | [1] | 166,117 | 159,324 | ||||||||
Significant Observable Inputs, Level 2 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | [1] | 13,969 | 12,301 | ||||||||
Significant Unobservable Inputs, Level 3 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | [1] | 0 | 0 | ||||||||
Money Market Accounts [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 8,151 | 7,990 | |||||||||
Money Market Accounts [Member] | Quoted Prices in Active Markets For Identical Assets, Level 1 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 103 | 2,240 | |||||||||
Money Market Accounts [Member] | Significant Observable Inputs, Level 2 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 8,048 | 5,750 | |||||||||
Money Market Accounts [Member] | Significant Unobservable Inputs, Level 3 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
Equity Securities [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 96,748 | 83,868 | |||||||||
Equity Securities [Member] | Quoted Prices in Active Markets For Identical Assets, Level 1 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 96,748 | 83,868 | |||||||||
Equity Securities [Member] | Significant Observable Inputs, Level 2 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
Equity Securities [Member] | Significant Unobservable Inputs, Level 3 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
U.S. Large-Cap [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 43,235 | 34,985 | |||||||||
U.S. Large-Cap [Member] | Quoted Prices in Active Markets For Identical Assets, Level 1 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 43,235 | 34,985 | |||||||||
U.S. Large-Cap [Member] | Significant Observable Inputs, Level 2 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
U.S. Large-Cap [Member] | Significant Unobservable Inputs, Level 3 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
U.S Mid/Small Cap [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 19,032 | 12,354 | |||||||||
U.S Mid/Small Cap [Member] | Quoted Prices in Active Markets For Identical Assets, Level 1 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 19,032 | 12,354 | |||||||||
U.S Mid/Small Cap [Member] | Significant Observable Inputs, Level 2 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
U.S Mid/Small Cap [Member] | Significant Unobservable Inputs, Level 3 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
CBSI Stock [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 7,417 | 8,393 | |||||||||
CBSI Stock [Member] | Quoted Prices in Active Markets For Identical Assets, Level 1 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 7,417 | 8,393 | |||||||||
CBSI Stock [Member] | Significant Observable Inputs, Level 2 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
CBSI Stock [Member] | Significant Unobservable Inputs, Level 3 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
International [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 27,064 | 28,136 | |||||||||
International [Member] | Quoted Prices in Active Markets For Identical Assets, Level 1 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 27,064 | 28,136 | |||||||||
International [Member] | Significant Observable Inputs, Level 2 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
International [Member] | Significant Unobservable Inputs, Level 3 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
Fixed Income Securities [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 63,106 | 69,767 | |||||||||
Fixed Income Securities [Member] | Quoted Prices in Active Markets For Identical Assets, Level 1 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 57,243 | 63,279 | |||||||||
Fixed Income Securities [Member] | Significant Observable Inputs, Level 2 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 5,863 | 6,488 | |||||||||
Fixed Income Securities [Member] | Significant Unobservable Inputs, Level 3 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
Government Securities [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 31,238 | 37,885 | |||||||||
Government Securities [Member] | Quoted Prices in Active Markets For Identical Assets, Level 1 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 25,375 | 31,397 | |||||||||
Government Securities [Member] | Significant Observable Inputs, Level 2 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 5,863 | 6,488 | |||||||||
Government Securities [Member] | Significant Unobservable Inputs, Level 3 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
Investment Grade Bonds [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 15,253 | 14,517 | |||||||||
Investment Grade Bonds [Member] | Quoted Prices in Active Markets For Identical Assets, Level 1 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 15,253 | 14,517 | |||||||||
Investment Grade Bonds [Member] | Significant Observable Inputs, Level 2 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
Investment Grade Bonds [Member] | Significant Unobservable Inputs, Level 3 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 0 | 0 | |||||||||
International Bonds [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 5,085 | ||||||||||
International Bonds [Member] | Quoted Prices in Active Markets For Identical Assets, Level 1 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 5,085 | ||||||||||
International Bonds [Member] | Significant Observable Inputs, Level 2 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 0 | ||||||||||
International Bonds [Member] | Significant Unobservable Inputs, Level 3 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 0 | ||||||||||
High Yield [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | [2] | 16,615 | 17,365 | ||||||||
High Yield [Member] | Quoted Prices in Active Markets For Identical Assets, Level 1 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | [2] | 16,615 | 17,365 | ||||||||
High Yield [Member] | Significant Observable Inputs, Level 2 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | [2] | 0 | 0 | ||||||||
High Yield [Member] | Significant Unobservable Inputs, Level 3 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | [2] | 0 | 0 | ||||||||
Other Investments [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | [3] | 12,081 | 10,000 | ||||||||
Other Investments [Member] | Quoted Prices in Active Markets For Identical Assets, Level 1 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | [3] | 12,023 | 9,937 | ||||||||
Other Investments [Member] | Significant Observable Inputs, Level 2 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | [3] | 58 | 63 | ||||||||
Other Investments [Member] | Significant Unobservable Inputs, Level 3 [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | [3] | 0 | 0 | ||||||||
State Bank of Chittenango Pension Plan [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Employer contributions | 0 | ||||||||||
Pension Benefits [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Fair value of plan assets | 180,400 | 172,026 | $ 177,865 | ||||||||
Employer contributions | $ 2,146 | $ 616 | |||||||||
Subsequent Event [Member] | Pension Benefits [Member] | |||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||
Employer contributions | $ 2,900 | ||||||||||
|
BENEFIT PLANS, Multi-employer Defined Benefit Plan (Details) - Multiemployer Plans, Pension [Member] - Pentegra DB Plan [Member] - Tupper Lake National Bank [Member] - USD ($) $ in Thousands |
12 Months Ended | |||
---|---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
Jun. 30, 2015 |
|
Multiemployer Plans [Line Items] | ||||
Identification number | 135645888 | |||
Plan number | 333 | |||
Fair value of plan assets | $ 3,300,000 | |||
Projected benefit obligation | $ 3,300,000 | |||
Funded status | At least 80 percent | |||
Period contributions | $ 50 | $ 30 | $ 60 | |
Significance of employer contributions | false |
BENEFIT PLANS, Assumed Health Care Cost Trend Rate (Details) |
12 Months Ended |
---|---|
Dec. 31, 2016 | |
Assumed Health Care Cost Trend Rates [Abstract] | |
Assumed health care cost trend rate for medical costs for participants younger than 65 | 7.50% |
Assumed health care cost trend rate for medical cost for participants older than 65 | 5.80% |
Assumed health care cost trend rate for prescription drugs | 10.50% |
Ultimate health care cost trend rate | 3.89% |
Year that rate reaches ultimate trend rate | 2075 |
BENEFIT PLANS, 401(K) Employee Stock Ownership Plan (Details) - Employee Stock Ownership Plan 401K Plan [Member] - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Defined Contribution Plan Disclosure [Line Items] | |||
Percentage of first eligible compensation fully matched by employer | 3.00% | ||
Percentage of matching contribution in the form of common stock | 100.00% | ||
Percentage of the next eligible compensation matched at 50% by employer | 3.00% | ||
Percentage of matching contributions for the next eligible compensation in the form of company stock | 50.00% | ||
(Income)/expense recognized under plan | $ 4.3 | $ 3.6 | $ 3.4 |
Interest credit contribution expense recognized for 401(k) plan | $ 0.7 | $ 1.1 | $ 0.9 |
Minimum [Member] | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Contribution from eligible compensation | 1.00% | ||
Maximum [Member] | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Contribution from eligible compensation | 90.00% |
BENEFIT PLANS, Other Deferred Compensation Arrangements (Details) - Other Deferred Compensation Arrangements [Member] - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | |||
Liability recorded for compensation plan | $ 3,200 | $ 3,600 | |
Expense recognized under plan | $ 30 | $ 100 | $ 300 |
BENEFIT PLANS, Deferred Compensation Plan for Directors (Details) - Deferred Compensation Plan for Directors [Member] - Directors [Member] - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items] | |||
Deferred compensation arrangement with individual, shares credited (in shares) | 154,013 | 151,672 | |
Liability accrued for compensation plan | $ 4.0 | $ 3.8 | |
Expense recognized under plan | $ 0.2 | $ 0.2 | $ 0.2 |
STOCK-BASED COMPENSATION PLANS, Long-Term Incentive Program (Details) - shares |
12 Months Ended | ||
---|---|---|---|
May 14, 2014 |
May 25, 2011 |
Dec. 31, 2016 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares of common stock authorized for stock-based compensation plan (in shares) | 4,000,000 | ||
Additional shares of common stock authorized for stock-based compensation plan (in shares) | 1,000,000 | 900,000 | |
Number of shares available for grant (in shares) | 900,000 | ||
Stock Options [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Term of options | 10 years | ||
Award vesting period | 5 years |
STOCK-BASED COMPENSATION PLANS, Activity in Long-Term Incentive Program (Details) - Stock Options [Member] - $ / shares |
12 Months Ended | |
---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Options, Outstanding [Roll Forward] | ||
Outstanding, beginning of period (in shares) | 1,969,301 | 2,151,776 |
Granted (in shares) | 330,383 | 293,242 |
Exercised (in shares) | (525,298) | (469,730) |
Forfeited (in shares) | (18,394) | (5,987) |
Outstanding, end of period (in shares) | 1,755,992 | 1,969,301 |
Exercisable, end of period (in shares) | 959,638 | |
Weighted-average exercise price of shares [Abstract] | ||
Outstanding, beginning of period (in dollars per share) | $ 28.15 | $ 25.92 |
Granted (in dollars per share) | 38.02 | 35.36 |
Exercised (in dollars per share) | 25.12 | 22.42 |
Forfeited (in dollars per share) | 34.47 | 30.21 |
Outstanding, end of period (in dollars per share) | 30.85 | $ 28.15 |
Exercisable, end of period (in dollars per share) | $ 26.94 |
STOCK-BASED COMPENSATION PLANS, Summary of Stock Options Outstanding (Details) $ / shares in Units, $ in Millions |
12 Months Ended |
---|---|
Dec. 31, 2016
USD ($)
$ / shares
shares
| |
Options [Abstract] | |
Options outstanding, shares (in shares) | shares | 1,755,992 |
Options outstanding, weighted-average exercise price (in dollars per share) | $ 30.85 |
Options outstanding, weighted-average remaining life | 6 years 3 months 11 days |
Options exercisable, shares (in shares) | shares | 959,638 |
Options exercisable, weighted-average exercise price (in dollars per share) | $ 26.94 |
Weighted-average remaining contractual term of outstanding stock options | 6 years 3 months 11 days |
Weighted-average remaining contractual term of outstanding and exercisable stock options | 4 years 10 months 20 days |
Aggregate intrinsic value of outstanding stock options | $ | $ 54.3 |
Aggregate intrinsic value of exercisable stock options | $ | $ 33.4 |
$0.00 - $18.00 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise price range, lower range limit (in dollars per share) | $ 0 |
Exercise price range, upper range limit (in dollars per share) | $ 18.00 |
Options [Abstract] | |
Options outstanding, shares (in shares) | shares | 44,436 |
Options outstanding, weighted-average exercise price (in dollars per share) | $ 17.70 |
Options outstanding, weighted-average remaining life | 2 years 2 months 19 days |
Options exercisable, shares (in shares) | shares | 44,436 |
Options exercisable, weighted-average exercise price (in dollars per share) | $ 17.70 |
$18.001 - $23.00 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise price range, lower range limit (in dollars per share) | 18.001 |
Exercise price range, upper range limit (in dollars per share) | $ 23.00 |
Options [Abstract] | |
Options outstanding, shares (in shares) | shares | 267,307 |
Options outstanding, weighted-average exercise price (in dollars per share) | $ 19.06 |
Options outstanding, weighted-average remaining life | 1 year 11 months 19 days |
Options exercisable, shares (in shares) | shares | 267,307 |
Options exercisable, weighted-average exercise price (in dollars per share) | $ 19.06 |
$23.001 - $28.00 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise price range, lower range limit (in dollars per share) | 23.001 |
Exercise price range, upper range limit (in dollars per share) | $ 28.00 |
Options [Abstract] | |
Options outstanding, shares (in shares) | shares | 159,662 |
Options outstanding, weighted-average exercise price (in dollars per share) | $ 26.28 |
Options outstanding, weighted-average remaining life | 5 years 6 months 14 days |
Options exercisable, shares (in shares) | shares | 159,536 |
Options exercisable, weighted-average exercise price (in dollars per share) | $ 26.28 |
$28.001 - $29.00 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise price range, lower range limit (in dollars per share) | 28.001 |
Exercise price range, upper range limit (in dollars per share) | $ 29.00 |
Options [Abstract] | |
Options outstanding, shares (in shares) | shares | 203,365 |
Options outstanding, weighted-average exercise price (in dollars per share) | $ 28.78 |
Options outstanding, weighted-average remaining life | 5 years 2 months 19 days |
Options exercisable, shares (in shares) | shares | 153,369 |
Options exercisable, weighted-average exercise price (in dollars per share) | $ 28.78 |
$29.001 - $30.00 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise price range, lower range limit (in dollars per share) | 29.001 |
Exercise price range, upper range limit (in dollars per share) | $ 30.00 |
Options [Abstract] | |
Options outstanding, shares (in shares) | shares | 254,826 |
Options outstanding, weighted-average exercise price (in dollars per share) | $ 29.79 |
Options outstanding, weighted-average remaining life | 6 years 2 months 16 days |
Options exercisable, shares (in shares) | shares | 144,226 |
Options exercisable, weighted-average exercise price (in dollars per share) | $ 29.79 |
$30.001 - $40.00 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise price range, lower range limit (in dollars per share) | 30.001 |
Exercise price range, upper range limit (in dollars per share) | $ 40.00 |
Options [Abstract] | |
Options outstanding, shares (in shares) | shares | 826,396 |
Options outstanding, weighted-average exercise price (in dollars per share) | $ 37.08 |
Options outstanding, weighted-average remaining life | 8 years 3 months 22 days |
Options exercisable, shares (in shares) | shares | 190,764 |
Options exercisable, weighted-average exercise price (in dollars per share) | $ 37.06 |
STOCK-BASED COMPENSATION PLANS, Stock-Based Compensation Expense Recognized (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Stock Options [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense related to incentive and non-qualified stock options recognized | $ 2.2 | $ 1.8 | $ 2.0 |
Income tax benefit recognized | 0.8 | 0.7 | 0.9 |
Restricted Stock [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense related to incentive and non-qualified stock options recognized | $ 2.4 | $ 2.2 | $ 2.0 |
STOCK-BASED COMPENSATION PLANS, Assumptions Used to Estimate Value of Stock Options (Details) - $ / shares |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
STOCK-BASED COMPENSATION PLANS [Abstract] | |||
Fair value assumptions, method used | Black-Scholes model | Black-Scholes model | Black-Scholes model |
Weighted-average Fair Value of Options Granted (in dollars per share) | $ 7.90 | $ 7.48 | $ 8.38 |
Assumptions [Abstract] | |||
Weighted-average expected life | 6 years 6 months | 6 years 6 months | 6 years 6 months |
Future dividend yield | 3.43% | 3.40% | 3.70% |
Share price volatility | 30.00% | 30.34% | 30.71% |
Weighted-average risk-free interest rate | 1.72% | 1.73% | 2.69% |
STOCK-BASED COMPENSATION PLANS, Unrecognized Stock-Based Compensation Expense and Stock Option Exercises (Details) - Stock Options [Member] - USD ($) shares in Millions, $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unrecognized stock-based compensation expense related to non-vested stock options | $ 4.4 | ||
Weighted average period for recognition of unrecognized compensation cost | 3 years 2 months 12 days | ||
Total fair value of stock options vested | $ 2.1 | $ 1.9 | $ 1.9 |
Proceeds from stock option exercises | 12.0 | 10.4 | |
Related tax benefits from stock option exercises | $ 2.7 | $ 2.1 | |
Shares issued in connection with stock option exercise (in shares) | 0.4 | 0.4 | |
Total intrinsic value of options exercised | $ 10.3 | $ 7.6 | $ 5.7 |
STOCK-BASED COMPENSATION PLANS, Activity of Unvested Restricted Stock Awards (Details) - Restricted Stock [Member] - USD ($) $ / shares in Units, $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Restricted Shares [Roll Forward] | |||
Unvested, beginning of period (in shares) | 246,311 | 245,721 | |
Awards (in shares) | 148,240 | 60,519 | |
Forfeitures (in shares) | (42,394) | (874) | |
Vestings (in shares) | (98,327) | (59,055) | |
Unvested, end of period (in shares) | 253,830 | 246,311 | 245,721 |
Weighted-average grant date fair value [Abstract] | |||
Unvested, beginning of period (in dollars per share) | $ 27.85 | $ 26.13 | |
Awards (in dollars per share) | 27.04 | 35.39 | |
Forfeitures (in dollars per share) | 17.49 | 32.43 | |
Vestings (in dollars per share) | 25.64 | 28.35 | |
Unvested, end of period (in dollars per share) | $ 29.98 | $ 27.85 | $ 26.13 |
Unrecognized stock-based compensation expense | $ 5.7 | ||
Award vesting period | 5 years | ||
Weighted-average period for recognition of unrecognized compensation cost | 4 years 8 months 12 days | ||
Total fair value of restricted stock vested | $ 2.5 | $ 1.7 | $ 1.6 |
EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
EARNINGS PER SHARE [Abstract] | |||
Weighted-average anti-dilutive stock options outstanding (in shares) | 300 | 300 | 200 |
Basic earnings per share [Abstract] | |||
Net income | $ 103,812 | $ 91,230 | $ 91,353 |
Income attributable to unvested stock-based compensation awards | (550) | (453) | (456) |
Income available to common shareholders | $ 103,262 | $ 90,777 | $ 90,897 |
Weighted-average common shares outstanding - basic (in shares) | 44,091 | 40,996 | 40,548 |
Basic earnings per share (in dollars per share) | $ 2.34 | $ 2.21 | $ 2.24 |
Diluted earnings per share [Abstract] | |||
Net income | $ 103,812 | $ 91,230 | $ 91,353 |
Income attributable to unvested stock-based compensation awards | (550) | (453) | (456) |
Income available to common shareholders | $ 103,262 | $ 90,777 | $ 90,897 |
Weighted-average common shares outstanding (in shares) | 44,091 | 40,996 | 40,548 |
Assumed exercise of stock options (in shares) | 394 | 405 | 481 |
Weighted-average common shares outstanding - diluted (in shares) | 44,485 | 41,401 | 41,029 |
Diluted earnings per share (in dollars per share) | $ 2.32 | $ 2.19 | $ 2.22 |
Cash dividends declared per share (in dollars per share) | $ 1.26 | $ 1.22 | $ 1.16 |
Stock Repurchase Program [Abstract] | |||
Number of common shares authorized to be repurchased (in shares) | 2,200 | 2,200 | |
Number of common shares repurchased (in shares) | 0 | 300 | 100 |
COMMITMENTS, CONTINGENT LIABILITIES AND RESTRICTIONS (Details) - USD ($) $ in Thousands |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Contract amount of commitments and contingencies | $ 796,098 | $ 830,495 |
Unused lines of credit | 25,000 | |
Federal Home Loan Bank unused borrowing capacity | 1,200,000 | |
Federal Reserve unused borrowing capacity | 26,000 | |
Federal Reserve required average total reserve | 82,800 | |
Federal Reserve requirement represented by cash on hand | 64,900 | |
Required deposit with Federal Reserve | 17,900 | |
Minimum [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Range of reasonably possible losses for such matters in the aggregate, beyond the existing recorded liability | 0 | |
Maximum [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Range of reasonably possible losses for such matters in the aggregate, beyond the existing recorded liability | 1,000 | |
Commitments to Extend Credit [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Contract amount of commitments and contingencies | 773,442 | 811,442 |
Standby Letters of Credit [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Contract amount of commitments and contingencies | $ 22,656 | $ 19,053 |
LEASES (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
LEASES [Abstract] | |||
Rental expense | $ 5,800 | $ 5,400 | $ 5,300 |
Future minimum rental commitments [Abstract] | |||
2017 | 6,078 | ||
2018 | 5,574 | ||
2019 | 5,040 | ||
2020 | 3,857 | ||
2021 | 3,098 | ||
Thereafter | 7,297 | ||
Total | $ 30,944 |
REGULATORY MATTERS (Details) - USD ($) $ in Thousands |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|
Tier 1 Leverage ratio [Abstract] | ||
Tier 1 Leverage ratio, actual amount | $ 858,347 | $ 788,717 |
Tier 1 Leverage ratio, actual ratio | 10.55% | 10.32% |
Tier 1 leverage ratio for capital adequacy purposes, amount | $ 325,438 | $ 305,761 |
Tier 1 leverage ratio for capital adequacy purposes, ratio | 4.00% | 4.00% |
Tier 1 leverage capital to be well-capitalized under prompt corrective action, amount | $ 406,798 | $ 382,201 |
Tier 1 leverage capital to be well-capitalized under prompt corrective action, ratio | 5.00% | 5.00% |
Tier 1 risk-based capital [Abstract] | ||
Tier 1 risk-based capital, actual amount | $ 858,347 | $ 788,717 |
Tier 1 risk-based capital, actual ratio | 18.10% | 17.09% |
Tier 1 risk-based capital for capital adequacy purposes, amount | $ 284,583 | $ 276,886 |
Tier 1 risk-based capital for capital adequacy purposes, ratio | 6.00% | 6.00% |
Tier 1 risk-based capital for capital adequacy purposes plus capital conservation buffer, amount | $ 314,228 | |
Tier 1 risk-based capital for capital adequacy purposes plus capital conservation buffer, ratio | 6.625% | |
Tier 1 risk based capital to be well-capitalized under prompt corrective action, amount | $ 379,445 | $ 369,181 |
Tier 1 risk-based capital to be well-capitalized under prompt corrective action, ratio | 8.00% | 8.00% |
Total risk-based capital [Abstract] | ||
Total risk-based capital, actual amount | $ 905,996 | $ 834,539 |
Total risk-based capital, actual ratio | 19.10% | 18.08% |
Total risk-based capital for capital adequacy purposes, amount | $ 379,445 | $ 369,181 |
Total risk-based capita for capital adequacy purposes, ratio | 8.00% | 8.00% |
Total risk-based capital for capital adequacy purposes plus capital conservation buffer, amount | $ 409,089 | |
Total risk-based capita for capital adequacy purposes plus capital conservation buffer, ratio | 8.625% | |
Total risk based capital to be well-capitalized under prompt corrective action, amount | $ 474,306 | $ 461,477 |
Total risk based capital to be well-capitalized under prompt corrective action, ratio | 10.00% | 10.00% |
Common equity Tier 1 capital [Abstract] | ||
Common equity Tier 1 capital, actual amount | $ 759,199 | $ 689,528 |
Common equity Tier 1 capital, actual ratio | 16.01% | 14.94% |
Common equity Tier 1 capital for capital adequacy purposes, amount | $ 213,438 | $ 207,664 |
Common equity Tier 1 capital for capital adequacy purposes, ratio | 4.50% | 4.50% |
Common equity Tier 1 capital for capital adequacy purposes plus capital conservation buffer, amount | $ 243,082 | |
Common equity Tier 1 capital for capital adequacy purposes plus capital conservation buffer, ratio | 5.125% | |
Common equity Tier 1 capital to be well-capitalized under prompt corrective action, amount | $ 308,299 | $ 299,960 |
Common equity Tier 1 capital to be well-capitalized under prompt corrective action, ratio | 6.50% | 6.50% |
Community Bank, N.A. [Member] | ||
Tier 1 Leverage ratio [Abstract] | ||
Tier 1 Leverage ratio, actual amount | $ 672,633 | $ 673,443 |
Tier 1 Leverage ratio, actual ratio | 8.30% | 8.88% |
Tier 1 leverage ratio for capital adequacy purposes, amount | $ 324,080 | $ 303,256 |
Tier 1 leverage ratio for capital adequacy purposes, ratio | 4.00% | 4.00% |
Tier 1 leverage capital to be well-capitalized under prompt corrective action, amount | $ 405,099 | $ 379,070 |
Tier 1 leverage capital to be well-capitalized under prompt corrective action, ratio | 5.00% | 5.00% |
Tier 1 risk-based capital [Abstract] | ||
Tier 1 risk-based capital, actual amount | $ 672,633 | $ 673,443 |
Tier 1 risk-based capital, actual ratio | 14.28% | 14.65% |
Tier 1 risk-based capital for capital adequacy purposes, amount | $ 282,662 | $ 275,739 |
Tier 1 risk-based capital for capital adequacy purposes, ratio | 6.00% | 6.00% |
Tier 1 risk-based capital for capital adequacy purposes plus capital conservation buffer, amount | $ 312,106 | |
Tier 1 risk-based capital for capital adequacy purposes plus capital conservation buffer, ratio | 6.625% | |
Tier 1 risk based capital to be well-capitalized under prompt corrective action, amount | $ 376,883 | $ 367,652 |
Tier 1 risk-based capital to be well-capitalized under prompt corrective action, ratio | 8.00% | 8.00% |
Total risk-based capital [Abstract] | ||
Total risk-based capital, actual amount | $ 720,282 | $ 719,265 |
Total risk-based capital, actual ratio | 15.29% | 15.65% |
Total risk-based capital for capital adequacy purposes, amount | $ 376,883 | $ 367,652 |
Total risk-based capita for capital adequacy purposes, ratio | 8.00% | 8.00% |
Total risk-based capital for capital adequacy purposes plus capital conservation buffer, amount | $ 406,327 | |
Total risk-based capita for capital adequacy purposes plus capital conservation buffer, ratio | 8.625% | |
Total risk based capital to be well-capitalized under prompt corrective action, amount | $ 471,104 | $ 459,565 |
Total risk based capital to be well-capitalized under prompt corrective action, ratio | 10.00% | 10.00% |
Common equity Tier 1 capital [Abstract] | ||
Common equity Tier 1 capital, actual amount | $ 672,578 | $ 673,326 |
Common equity Tier 1 capital, actual ratio | 14.28% | 14.65% |
Common equity Tier 1 capital for capital adequacy purposes, amount | $ 211,997 | $ 206,804 |
Common equity Tier 1 capital for capital adequacy purposes, ratio | 4.50% | 4.50% |
Common equity Tier 1 capital for capital adequacy purposes plus capital conservation buffer, amount | $ 241,441 | |
Common equity Tier 1 capital for capital adequacy purposes plus capital conservation buffer, ratio | 5.125% | |
Common equity Tier 1 capital to be well-capitalized under prompt corrective action, amount | $ 306,217 | $ 298,717 |
Common equity Tier 1 capital to be well-capitalized under prompt corrective action, ratio | 6.50% | 6.50% |
PARENT COMPANY STATEMENTS, Condensed Balance Sheets (Details) - USD ($) $ in Thousands |
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
Dec. 31, 2013 |
---|---|---|---|---|
Assets [Abstract] | ||||
Cash and cash equivalents | $ 173,857 | $ 153,210 | $ 138,396 | $ 149,647 |
Investment in and advances to [Abstract] | ||||
Other assets | 180,188 | 170,129 | ||
Total assets | 8,666,437 | 8,552,669 | 7,489,440 | |
Liabilities and shareholders' equity [Abstract] | ||||
Accrued interest and other liabilities | 144,013 | 135,102 | ||
Borrowings | 102,170 | 102,146 | ||
Shareholders' equity | 1,198,100 | 1,140,647 | 987,904 | 875,812 |
Total liabilities and shareholders' equity | 8,666,437 | 8,552,669 | ||
Parent Company [Member] | ||||
Assets [Abstract] | ||||
Cash and cash equivalents | 151,127 | 97,317 | $ 106,957 | $ 83,783 |
Investment securities | 3,628 | 3,576 | ||
Investment in and advances to [Abstract] | ||||
Bank subsidiary | 1,116,554 | 1,117,419 | ||
Non-bank subsidiaries | 35,566 | 30,643 | ||
Other assets | 10,345 | 9,996 | ||
Total assets | 1,317,220 | 1,258,951 | ||
Liabilities and shareholders' equity [Abstract] | ||||
Accrued interest and other liabilities | 16,950 | 16,158 | ||
Borrowings | 102,170 | 102,146 | ||
Shareholders' equity | 1,198,100 | 1,140,647 | ||
Total liabilities and shareholders' equity | $ 1,317,220 | $ 1,258,951 |
PARENT COMPANY STATEMENTS, Condensed Statements of Income (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Expenses [Abstract] | |||
Interest on borrowings | $ 2,949 | $ 2,537 | $ 2,477 |
Acquisition expenses | 1,706 | 7,037 | 123 |
Other expenses | 16,553 | 13,521 | 17,310 |
Income before tax benefit and equity in undistributed net income of subsidiaries | 154,597 | 132,217 | 129,690 |
Income tax benefit/(expense) | (50,785) | (40,987) | (38,337) |
Net income | 103,812 | 91,230 | 91,353 |
Other comprehensive (loss)/income, net of tax [Abstract] | |||
Other comprehensive income/(loss) related to pension and other post retirement obligations | 3,322 | (4,567) | (9,571) |
Other comprehensive (loss)/income related to unrealized (losses)/gains on available-for-sale securities | (14,714) | (6,918) | 66,837 |
Other comprehensive (loss)/income, net of tax | (11,392) | (11,485) | 57,266 |
Comprehensive income | 92,420 | 79,745 | 148,619 |
Parent Company [Member] | |||
Dividends from subsidiaries [Abstract] | |||
Bank subsidiary | 89,000 | 70,000 | 57,200 |
Non-bank subsidiaries | 1,750 | 6,000 | 3,900 |
Interest and dividends on investments | 102 | 94 | 88 |
Total revenues | 90,852 | 76,094 | 61,188 |
Expenses [Abstract] | |||
Interest on borrowings | 2,949 | 2,537 | 2,477 |
Acquisition expenses | 429 | 0 | 0 |
Other expenses | 11 | 19 | 37 |
Total expenses | 3,389 | 2,556 | 2,514 |
Income before tax benefit and equity in undistributed net income of subsidiaries | 87,463 | 73,538 | 58,674 |
Income tax benefit/(expense) | 866 | (572) | 581 |
Income before equity in undistributed net income of subsidiaries | 88,329 | 72,966 | 59,255 |
Equity in undistributed net income of subsidiaries | 15,483 | 18,264 | 32,098 |
Net income | 103,812 | 91,230 | 91,353 |
Other comprehensive (loss)/income, net of tax [Abstract] | |||
Other comprehensive income/(loss) related to pension and other post retirement obligations | 3,322 | (4,567) | (9,571) |
Other comprehensive (loss)/income related to unrealized (losses)/gains on available-for-sale securities | (14,714) | (6,918) | 66,837 |
Other comprehensive (loss)/income, net of tax | (11,392) | (11,485) | 57,266 |
Comprehensive income | $ 92,420 | $ 79,745 | $ 148,619 |
PARENT COMPANY STATEMENTS, Condensed Statements of Cash Flows (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Operating activities [Abstract] | |||
Net income | $ 103,812 | $ 91,230 | $ 91,353 |
Adjustments to reconcile net income to net cash provided by operating activities [Abstract] | |||
Net change in other assets and other liabilities | (12,124) | (8,784) | (970) |
Net cash provided by operating activities | 131,261 | 116,463 | 122,104 |
Investing activities [Abstract] | |||
Cash received for acquisitions, net of cash acquired of $0, $81,772, and $0, respectively | (575) | 25,505 | (924) |
Net cash (used in) provided by investing activities | (121,998) | (274,161) | (331,132) |
Financing activities [Abstract] | |||
Issuance of common stock | 10,543 | 9,774 | 9,417 |
Purchases of treasury stock | (3,470) | (9,126) | (4,368) |
Sale of treasury stock | 8,888 | 16,571 | 1,531 |
Net cash provided by (used in) financing activities | 11,384 | 172,512 | 197,777 |
Change in cash and cash equivalents | 20,647 | 14,814 | (11,251) |
Cash and cash equivalents at beginning of year | 153,210 | 138,396 | 149,647 |
Cash and cash equivalents at end of year | 173,857 | 153,210 | 138,396 |
Supplemental disclosures of cash flow information [Abstract] | |||
Cash paid for interest | 11,268 | 11,252 | 11,937 |
Supplemental disclosures of noncash financing activities [Abstract] | |||
Dividends declared and unpaid | 14,268 | 13,605 | 12,254 |
Common stock issued for acquisition | 0 | 102,202 | 0 |
Cash acquired related to acquisition | 0 | 81,772 | 0 |
Parent Company [Member] | |||
Operating activities [Abstract] | |||
Net income | 103,812 | 91,230 | 91,353 |
Adjustments to reconcile net income to net cash provided by operating activities [Abstract] | |||
Equity in undistributed net income of subsidiaries | (15,483) | (18,264) | (32,098) |
Net change in other assets and other liabilities | (215) | (27) | (479) |
Net cash provided by operating activities | 88,114 | 72,939 | 58,776 |
Investing activities [Abstract] | |||
Proceeds from sale of investment securities | 0 | 0 | 3 |
Cash received for acquisitions, net of cash acquired of $0, $81,772, and $0, respectively | 0 | 25,505 | 0 |
Capital contributions to subsidiaries | 0 | (80,231) | 0 |
Net cash (used in) provided by investing activities | 0 | (54,726) | 3 |
Financing activities [Abstract] | |||
Issuance of common stock | 15,326 | 13,975 | 13,410 |
Purchases of treasury stock | (3,470) | (9,126) | (4,368) |
Sale of treasury stock | 8,888 | 16,571 | 1,531 |
Cash dividends paid | (55,048) | (49,273) | (46,178) |
Net cash provided by (used in) financing activities | (34,304) | (27,853) | (35,605) |
Change in cash and cash equivalents | 53,810 | (9,640) | 23,174 |
Cash and cash equivalents at beginning of year | 97,317 | 106,957 | 83,783 |
Cash and cash equivalents at end of year | 151,127 | 97,317 | 106,957 |
Supplemental disclosures of cash flow information [Abstract] | |||
Cash paid for interest | 2,909 | 2,523 | 2,473 |
Supplemental disclosures of noncash financing activities [Abstract] | |||
Dividends declared and unpaid | 14,268 | 13,605 | 12,254 |
Capital contributions to subsidiaries | 0 | 76,461 | 0 |
Common stock issued for acquisition | 0 | 102,202 | 0 |
Cash acquired related to acquisition | $ 0 | $ 81,772 | $ 0 |
FAIR VALUE, Financial Assets and Liabilities Accounted for at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | $ 2,748,656 | $ 2,808,113 |
Recurring [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 2,748,656 | 2,808,113 |
Mortgage loans held for sale | 2,416 | 932 |
Commitments to originate real estate loans for sale | 54 | 117 |
Forward sales commitments | 3 | (37) |
Total | 2,751,129 | 2,809,125 |
Recurring [Member] | U.S. Treasury and Agency Securities [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 1,902,762 | 1,899,978 |
Recurring [Member] | Obligations of State and Political Subdivisions [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 594,990 | 666,883 |
Recurring [Member] | Government Agency Mortgage-Backed Securities [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 235,230 | 210,865 |
Recurring [Member] | Corporate Debt Securities [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 5,687 | 16,680 |
Recurring [Member] | Government Agency Collateralized Mortgage Obligations [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 9,535 | 13,308 |
Recurring [Member] | Marketable Equity Securities [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 452 | 399 |
Recurring [Member] | Level 1 [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 1,903,214 | 1,900,377 |
Mortgage loans held for sale | 0 | 0 |
Commitments to originate real estate loans for sale | 0 | 0 |
Forward sales commitments | 0 | 0 |
Total | 1,903,214 | 1,900,377 |
Recurring [Member] | Level 1 [Member] | U.S. Treasury and Agency Securities [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 1,902,762 | 1,899,978 |
Recurring [Member] | Level 1 [Member] | Obligations of State and Political Subdivisions [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 0 | 0 |
Recurring [Member] | Level 1 [Member] | Government Agency Mortgage-Backed Securities [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 0 | 0 |
Recurring [Member] | Level 1 [Member] | Corporate Debt Securities [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 0 | 0 |
Recurring [Member] | Level 1 [Member] | Government Agency Collateralized Mortgage Obligations [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 0 | 0 |
Recurring [Member] | Level 1 [Member] | Marketable Equity Securities [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 452 | 399 |
Recurring [Member] | Level 2 [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 845,442 | 907,736 |
Mortgage loans held for sale | 2,416 | 932 |
Commitments to originate real estate loans for sale | 0 | 0 |
Forward sales commitments | 3 | (37) |
Total | 847,861 | 908,631 |
Mortgage loans held for sale, at principal value | 2,400 | |
Mortgage loans held for sale, gross unrealized gain (Loss) | 2 | |
Recurring [Member] | Level 2 [Member] | U.S. Treasury and Agency Securities [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 0 | 0 |
Recurring [Member] | Level 2 [Member] | Obligations of State and Political Subdivisions [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 594,990 | 666,883 |
Recurring [Member] | Level 2 [Member] | Government Agency Mortgage-Backed Securities [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 235,230 | 210,865 |
Recurring [Member] | Level 2 [Member] | Corporate Debt Securities [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 5,687 | 16,680 |
Recurring [Member] | Level 2 [Member] | Government Agency Collateralized Mortgage Obligations [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 9,535 | 13,308 |
Recurring [Member] | Level 2 [Member] | Marketable Equity Securities [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 0 | 0 |
Recurring [Member] | Level 3 [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 0 | 0 |
Mortgage loans held for sale | 0 | 0 |
Commitments to originate real estate loans for sale | 54 | 117 |
Forward sales commitments | 0 | 0 |
Total | 54 | 117 |
Recurring [Member] | Level 3 [Member] | U.S. Treasury and Agency Securities [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 0 | 0 |
Recurring [Member] | Level 3 [Member] | Obligations of State and Political Subdivisions [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 0 | 0 |
Recurring [Member] | Level 3 [Member] | Government Agency Mortgage-Backed Securities [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 0 | 0 |
Recurring [Member] | Level 3 [Member] | Corporate Debt Securities [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 0 | 0 |
Recurring [Member] | Level 3 [Member] | Government Agency Collateralized Mortgage Obligations [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | 0 | 0 |
Recurring [Member] | Level 3 [Member] | Marketable Equity Securities [Member] | ||
Available-for-sale investment securities [Abstract] | ||
Available-for-sale investment securities | $ 0 | $ 0 |
FAIR VALUE, Unobservable Input Reconciliation (Details) - Commitments to Originate Real Estate Loans for Sale [Member] - USD ($) $ in Thousands |
12 Months Ended | |||
---|---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
|||
Level 3 Assets Measured at Fair Value on a Recurring Basis [Abstract] | ||||
Beginning balance | $ 117 | $ 185 | ||
Total (losses)/gains included in earnings | [1] | (1,234) | (808) | |
Commitments to originate real estate loans held for sale, net | 1,171 | 740 | ||
Ending balance | $ 54 | $ 117 | ||
|
FAIR VALUE, Assets and Liabilities Measured on Nonrecurring Basis (Details) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016
USD ($)
Loan
|
Dec. 31, 2015
USD ($)
|
Dec. 31, 2014
USD ($)
|
|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Number of impaired loans recorded at fair value of underlying collateral | Loan | 2 | ||
Fair value of MSRs at end of period | $ 1,928 | $ 1,962 | |
Valuation allowance | 477 | 0 | |
Carrying value before valuation allowance at end of period | 1,435 | 1,472 | $ 1,089 |
Mortgage Servicing Rights [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value of MSRs at end of period | 1,900 | ||
Valuation allowance | 0 | ||
Carrying value before valuation allowance at end of period | 1,400 | ||
Other Real Estate Owned [Member] | Market Approach Valuation Technique [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Total | $ 1,966 | $ 2,088 | |
Other Real Estate Owned [Member] | Market Approach Valuation Technique [Member] | Minimum [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Discount rate | 9.00% | 5.30% | |
Other Real Estate Owned [Member] | Market Approach Valuation Technique [Member] | Maximum [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Discount rate | 97.00% | 74.00% | |
Level 3 [Member] | Other Real Estate Owned [Member] | Market Approach Valuation Technique [Member] | Minimum [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Discount rate | 9.00% | ||
Level 3 [Member] | Other Real Estate Owned [Member] | Market Approach Valuation Technique [Member] | Maximum [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Discount rate | 97.00% | ||
Non-recurring [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Impaired loans | $ 633 | $ 1,765 | |
Other real estate owned | 1,966 | 2,088 | |
Total | 2,599 | 3,853 | |
Non-recurring [Member] | Level 1 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Impaired loans | 0 | 0 | |
Other real estate owned | 0 | 0 | |
Total | 0 | 0 | |
Non-recurring [Member] | Level 2 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Impaired loans | 0 | 0 | |
Other real estate owned | 0 | 0 | |
Total | 0 | 0 | |
Non-recurring [Member] | Level 3 [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Impaired loans | 633 | 1,765 | |
Other real estate owned | 1,966 | 2,088 | |
Total | $ 2,599 | $ 3,853 |
FAIR VALUE, Significant Unobservable Inputs (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Other Real Estate Owned [Member] | Fair Value of Collateral [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Fair value | $ 1,966 | $ 2,088 |
Other Real Estate Owned [Member] | Fair Value of Collateral [Member] | Minimum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Estimated cost of disposal/market adjustment | 9.00% | 5.30% |
Other Real Estate Owned [Member] | Fair Value of Collateral [Member] | Maximum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Estimated cost of disposal/market adjustment | 97.00% | 74.00% |
Other Real Estate Owned [Member] | Fair Value of Collateral [Member] | Weighted Average [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Estimated cost of disposal/market adjustment | 29.60% | 27.70% |
Impaired Loans [Member] | Fair Value of Collateral [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Fair value | $ 633 | $ 1,765 |
Impaired Loans [Member] | Fair Value of Collateral [Member] | Minimum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Estimated cost of disposal/market adjustment | 15.00% | 9.00% |
Impaired Loans [Member] | Fair Value of Collateral [Member] | Maximum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Estimated cost of disposal/market adjustment | 50.00% | 20.00% |
Impaired Loans [Member] | Fair Value of Collateral [Member] | Weighted Average [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Estimated cost of disposal/market adjustment | 36.50% | 17.90% |
Commitments to Originate Real Estate Loans for Sale [Member] | Discounted Cash Flow [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Fair value | $ 54 | $ 117 |
Embedded servicing value | 1.00% | 1.00% |
FAIR VALUE, Carrying Amounts and Estimated Fair Values of Other Financial Instruments (Details) - USD ($) $ in Thousands |
Dec. 31, 2016 |
Dec. 31, 2015 |
---|---|---|
Carrying Value [Member] | ||
Financial assets [Abstract] | ||
Net loans | $ 4,901,329 | $ 4,755,974 |
Financial liabilities [Abstract] | ||
Deposits | 7,075,954 | 6,873,474 |
Borrowings | 146,200 | 301,300 |
Subordinated debt held by unconsolidated subsidiary trusts | 102,170 | 102,146 |
Fair Value [Member] | ||
Financial assets [Abstract] | ||
Net loans | 4,935,140 | 4,808,856 |
Financial liabilities [Abstract] | ||
Deposits | 7,071,191 | 6,871,098 |
Borrowings | 146,200 | 301,300 |
Subordinated debt held by unconsolidated subsidiary trusts | $ 90,144 | $ 84,680 |
VARIABLE INTEREST ENTITIES (Details) - USD ($) $ in Thousands |
12 Months Ended | |||
---|---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
Dec. 31, 2013 |
|
Variable Interest Entity [Line Items] | ||||
Cash and cash equivalents | $ 173,857 | $ 153,210 | $ 138,396 | $ 149,647 |
Premises and equipment, net | 112,318 | 114,434 | ||
Other assets | 180,188 | 170,129 | ||
Variable Interest Entity, Primary Beneficiary [Member] | 706 North Clinton [Member] | ||||
Variable Interest Entity [Line Items] | ||||
Cash and cash equivalents | 30 | 42 | ||
Premises and equipment, net | 6,429 | 6,592 | ||
Other assets | 0 | 9 | ||
Total assets | 6,459 | 6,643 | ||
Accrued interest and other liabilities / Total liabilities | 1 | $ 5 | ||
Minority interest | 3,230 | |||
Loss of minority interest | 4,800 | |||
Minority interest loss exposure related to financing agreement | $ 1,600 | |||
Variable Interest Entity, Primary Beneficiary [Member] | 706 North Clinton [Member] | Oneida Preferred Funding II LLC [Member] | ||||
Variable Interest Entity [Line Items] | ||||
Percentage of membership interest | 50.00% |
SEGMENT INFORMATION (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
|
Information about reportable segments [Abstract] | |||
Net interest income | $ 273,896 | $ 248,420 | $ 244,428 |
Provision for loan losses | 8,076 | 6,447 | 7,178 |
Noninterest income | 155,625 | 123,299 | 119,020 |
Amortization of intangible assets | 5,479 | 3,663 | 4,287 |
Other operating expenses | 261,369 | 229,392 | 222,293 |
Income before income taxes | 154,597 | 132,217 | 129,690 |
Assets | 8,666,437 | 8,552,669 | 7,489,440 |
Goodwill | 465,142 | 463,252 | 375,174 |
Eliminations [Member] | |||
Information about reportable segments [Abstract] | |||
Net interest income | 0 | 0 | 0 |
Provision for loan losses | 0 | 0 | 0 |
Noninterest income | (2,442) | (2,156) | (1,880) |
Amortization of intangible assets | 0 | 0 | 0 |
Other operating expenses | (2,442) | (2,156) | (1,880) |
Income before income taxes | 0 | 0 | 0 |
Assets | (41,790) | (65,637) | (21,087) |
Goodwill | 0 | 0 | 0 |
Banking [Member] | Operating Segments [Member] | |||
Information about reportable segments [Abstract] | |||
Net interest income | 273,542 | 248,167 | 244,243 |
Provision for loan losses | 8,076 | 6,447 | 7,178 |
Noninterest income | 66,059 | 57,704 | 58,565 |
Amortization of intangible assets | 2,682 | 2,803 | 3,438 |
Other operating expenses | 191,268 | 181,865 | 178,472 |
Income before income taxes | 137,575 | 114,756 | 113,720 |
Assets | 8,598,057 | 8,513,228 | 7,463,379 |
Goodwill | 440,870 | 439,052 | 364,495 |
Employee Benefit Services [Member] | Operating Segments [Member] | |||
Information about reportable segments [Abstract] | |||
Net interest income | 162 | 132 | 92 |
Provision for loan losses | 0 | 0 | 0 |
Noninterest income | 48,261 | 46,784 | 43,701 |
Amortization of intangible assets | 420 | 515 | 647 |
Other operating expenses | 37,337 | 35,218 | 32,846 |
Income before income taxes | 10,666 | 11,183 | 10,300 |
Assets | 38,742 | 35,011 | 31,513 |
Goodwill | 8,019 | 8,019 | 8,019 |
All Other [Member] | Operating Segments [Member] | |||
Information about reportable segments [Abstract] | |||
Net interest income | 192 | 121 | 93 |
Provision for loan losses | 0 | 0 | 0 |
Noninterest income | 43,747 | 20,967 | 18,634 |
Amortization of intangible assets | 2,377 | 345 | 202 |
Other operating expenses | 35,206 | 14,465 | 12,855 |
Income before income taxes | 6,356 | 6,278 | 5,670 |
Assets | 71,428 | 70,067 | 15,635 |
Goodwill | $ 16,253 | $ 16,181 | $ 2,660 |
SUBSEQUENT EVENTS (Details) $ in Millions |
Feb. 03, 2017
USD ($)
|
---|---|
Subsequent Event [Member] | Northeast Retirement Services, Inc. [Member] | |
Subsequent Event [Line Items] | |
Purchase price of acquisition | $ 148 |
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