TRANSACTIONS WITH RELATED PARTIES (Notes)

12 Months Ended

Dec. 31, 2019

TRANSACTIONS WITH RELATED PARTIES

Certain directors and officers (including their affiliates, certain family members and entities in which they are principal owners) of the Company are customers of and have had, and are expected to have, transactions with the Company, within the ordinary course of business. These transactions include, but are not limited to, lending activities, deposit services, investment management, and property lease commitments. In the opinion of management, such transactions are consistent with prudent banking practices and are within applicable banking regulations. Further details relating to certain related party transactions are outlined below:

Lending Activities

The following information represents annual activity of loans to related parties for the periods indicated:



	2019			2018
	(Dollars in thousands)
Principal balance of loans outstanding at beginning of year	$	41,170		$	52,458
Loan advances (1)	49,771			14,862
Loan payments/payoffs	(35,111		)	(14,057		)
Reduction for retired directors	—			(12,093		)
Principal balance of loans outstanding at end of year	$	55,830		$	41,170


(1)	The 2019 amount includes $7.0 million of BHB acquired loans associated with a director during the year, which represent the outstanding loan balances at the effective date of appointment.

At December 31, 2019 and 2018, there were no loans to related parties which were past due, on nonaccrual status or that had been restructured as part of a troubled debt restructuring.

Deposits

At December 31, 2019 and 2018, the amount of deposit balances of related parties totaled $13.0 million and $10.8 million, respectively.

Lease Commitments

There were no material leases with related parties during the years ended December 31, 2019 and 2018.