10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

________________________________________________________________________________________

Form 10-Q

________________________________________________________________________________________

Quarterly Report Under Section 13 or 15(d)

of the Securities Exchange Act of 1934

For Quarter endedSeptember 30, 2018

Commission File Number1-35746

________________________________________________________________________________________

Bryn Mawr Bank Corporation

(Exact name of registrant as specified in its charter)

________________________________________________________________________________________

Pennsylvania	23-2434506
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer identification No.)
801 Lancaster Avenue, Bryn Mawr, Pennsylvania	19010
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code (610) 525-1700

Not Applicable

Former name, former address and fiscal year, if changed since last report.

________________________________________________________________________________________

Indicate by checkmark whether the registrant (1) has filed all reports to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No   ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ☒    No   ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer  ☒    Accelerated filer  ☐

Non-accelerated filer  ☐    Smaller reporting company  ☐ Emerging growth company  ☐ 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)    Yes  ☐    No   ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Classes	Outstanding at November 1, 2018
Common Stock, par value $1	20,250,227

BRYN MAWR BANK CORPORATION AND SUBSIDIARIES

FORM 10-Q

QUARTER ENDED SEPTEMBER 30, 2018

Index

PART I -	FINANCIAL INFORMATION
ITEM 1.	Financial Statements (unaudited)
	Consolidated Financial Statements (unaudited)	Page 3
	Notes to Consolidated Financial Statements (unaudited)	Page 8
ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	Page 56
ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk	Page 78
ITEM 4.	Controls and Procedures	Page 78
PART II -	OTHER INFORMATION	Page 78
ITEM 1.	Legal Proceedings	Page 78
ITEM 1A.	Risk Factors	Page 78
ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	Page 79
ITEM 3.	Defaults Upon Senior Securities	Page 80
ITEM 4.	Mine Safety Disclosures	Page 80
ITEM 5.	Other Information	Page 80
ITEM 6.	Exhibits	Page 81

PART I. FINANCIAL INFORMATION

ITEM 1. Financial Statements

BRYN MAWR BANK CORPORATION AND SUBSIDIARIES

Consolidated Balance Sheets - Unaudited

(dollars in thousands)	September 30, 2018			December 31, 2017
Assets
Cash and due from banks	$	10,121		$	11,657
Interest bearing deposits with banks	35,233			48,367
Cash and cash equivalents	45,354			60,024
Investment securities available for sale, at fair value (amortized cost of $543,240 and $692,824 as of September 30, 2018 and December 31, 2017, respectively)	528,064			689,202
Investment securities held to maturity, at amortized cost (fair value of $8,544 and $7,851 as of September 30, 2018 and December 31, 2017, respectively)	8,916			7,932
Investment securities, trading	8,340			4,610
Loans held for sale	4,111			3,794
Portfolio loans and leases, originated	2,752,160			2,487,296
Portfolio loans and leases, acquired	629,315			798,562
Total portfolio loans and leases	3,381,475			3,285,858
Less: Allowance for originated loan and lease losses	(18,612		)	(17,475		)
Less: Allowance for acquired loan and lease losses	(72		)	(50		)
Total allowance for loans and lease losses	(18,684		)	(17,525		)
Net portfolio loans and leases	3,362,791			3,268,333
Premises and equipment, net	63,281			54,458
Accrued interest receivable	13,232			14,246
Mortgage servicing rights	5,328			5,861
Bank owned life insurance	57,543			56,667
Federal Home Loan Bank stock	14,678			20,083
Goodwill	183,864			179,889
Intangible assets	24,301			25,966
Other investments	16,529			12,470
Other assets	52,110			46,185
Total assets	$	4,388,442		$	4,449,720
Liabilities
Deposits:
Noninterest-bearing	$	834,363		$	924,844
Interest-bearing	2,522,863			2,448,954
Total deposits	3,357,226			3,373,798
Short-term borrowings	226,498			237,865
Long-term FHLB advances	72,841			139,140
Subordinated notes	98,482			98,416
Junior subordinated debentures	21,538			21,416
Accrued interest payable	7,193			3,527
Other liabilities	53,239			47,439
Total liabilities	3,837,017			3,921,601
Shareholders' equity
Common stock, par value $1; authorized 100,000,000 shares; issued 24,532,745 and 24,360,049 shares as of September 30, 2018 and December 31, 2017, respectively and outstanding of 20,292,420 and 20,161,395 as of September 30, 2018 and December 31, 2017, respectively	24,533			24,360
Paid-in capital in excess of par value	373,205			371,486
Less: Common stock in treasury at cost - 4,240,325 and 4,198,654 shares as of September 30, 2018 and December 31, 2017, respectively	(70,437		)	(68,179		)
Accumulated other comprehensive loss, net of tax	(13,402		)	(4,414		)
Retained earnings	238,204			205,549
Total Bryn Mawr Bank Corporation shareholders' equity	552,103			528,802
Noncontrolling interest	(678		)	(683		)
Total shareholders' equity	551,425			528,119
Total liabilities and shareholders' equity	$	4,388,442		$	4,449,720

The accompanying notes are an integral part of the Unaudited Consolidated Financial Statements.

Page 3

BRYN MAWR BANK CORPORATION AND SUBSIDIARIES

Consolidated Statements of Income - Unaudited

	Three Months Ended September 30,					Nine Months Ended September 30,
(dollars in thousands, except share and per share data)	2018			2017		2018		2017
Interest income:
Interest and fees on loans and leases	$	42,103		$	30,892	$	124,481	$	88,517
Interest on cash and cash equivalents	64			36		181		137
Interest on investment securities:
Taxable	2,993			2,177		8,621		5,706
Non-taxable	71			91		233		302
Dividends	2			2		5		99
Total interest income	45,233			33,198		133,521		94,761
Interest expense:
Interest on deposits	5,533			2,198		13,504		6,009
Interest on short-term borrowings	1,096			547		2,711		811
Interest on FHLB advances and other borrowings	394			645		1,446		2,025
Interest on subordinated notes	1,144			370		3,430		1,110
Interest on junior subordinated debentures	337			—		946		—
Total interest expense	8,504			3,760		22,037		9,955
Net interest income	36,729			29,438		111,484		84,806
Provision for loan and lease losses	664			1,333		4,831		1,541
Net interest income after provision for loan and lease losses	36,065			28,105		106,653		83,265
Noninterest income:
Fees for wealth management services	10,343			9,651		31,309		28,761
Insurance commissions	1,754			1,373		5,349		3,079
Capital markets revenue	710			843		3,481		1,796
Service charges on deposits	726			676		2,191		1,953
Loan servicing and other fees	559			548		1,720		1,570
Net gain on sale of loans	631			799		1,677		1,948
Net gain on sale of investment securities available for sale	—			72		7		73
Net gain (loss) on sale of other real estate owned ("OREO")	5			—		292		(12		)
Dividends on FHLB and FRB stock	375			217		1,316		649
Other operating income	3,171			1,405		10,543		3,779
Total noninterest income	18,274			15,584		57,885		43,596
Noninterest expenses:
Salaries and wages	16,528			13,602		48,750		39,632
Employee benefits	3,356			2,560		9,941		7,453
Occupancy and bank premises	2,717			2,485		8,464		7,258
Furniture, fixtures, and equipment	2,070			1,726		6,037		5,569
Advertising	349			277		1,179		1,068
Amortization of intangible assets	891			677		2,659		2,057
Due diligence, merger-related and merger integration expenses	389			850		7,761		2,597
Professional fees	997			739		2,677		2,499
Pennsylvania bank shares tax	472			317		1,418		1,278
Information technology	1,155			880		3,602		2,575
Other operating expenses	4,668			4,071		12,970		11,353
Total noninterest expenses	33,592			28,184		105,458		83,339
Income before income taxes	20,747			15,505		59,080		43,522
Income tax expense	4,066			4,766		12,419		14,306
Net income	$	16,681		$	10,739	$	46,661	$	29,216
Net (loss) income attributable to noncontrolling interest	(1		)	—		5		—
Net income attributable to Bryn Mawr Bank Corporation	$	16,682		$	10,739	$	46,656	$	29,216
Basic earnings per common share	$	0.82		$	0.63	$	2.31	$	1.72
Diluted earnings per common share	$	0.82		$	0.62	$	2.28	$	1.69
Dividends paid or accrued per common share	$	0.25		$	0.22	$	0.69	$	0.64
Weighted-average basic shares outstanding	20,270,706			17,023,046		20,237,757		16,987,499
Dilutive shares	167,670			230,936		206,318		254,728
Adjusted weighted-average diluted shares	20,438,376			17,253,982		20,444,075		17,242,227

The accompanying notes are an integral part of the Unaudited Consolidated Financial Statements.

Page 4

BRYN MAWR BANK CORPORATION AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income - Unaudited

	Three Months Ended September 30,						Nine Months Ended September 30,
(dollars in thousands)	2018			2017			2018			2017
Net income attributable to Bryn Mawr Bank Corporation	$	16,682		$	10,739		$	46,656		$	29,216
Other comprehensive (loss) income:
Net change in unrealized (losses) gains on investment securities available for sale:
Net unrealized (losses) gains arising during the period, net of tax (benefit) expense of $(616), $105, $(2,337), and $535, respectively	(2,319		)	196			(8,792		)	995
Reclassification adjustment for net (gain) on sale realized in net income, net of tax (expense) of $0, $(25), $(1), and $(25), respectively	—			(47		)	(6		)	(48		)
Reclassification adjustment for net (gain) realized on transfer of investment securities available for sale to trading, net of tax (expense) benefit of $0, $0, $(88), and $0, respectively	—			—			(329		)	—
Unrealized investment (losses) gains, net of tax (benefit) expense of $(616), $80, $(2,426), and $510, respectively	(2,319		)	149			(9,127		)	947
Net change in unfunded pension liability:
Change in unfunded pension liability related to unrealized loss, prior service cost and transition obligation, net of tax expense of $28, $9, $37, and $34, respectively	108			15			139			62
Total other comprehensive (loss) income	(2,211		)	164			(8,988		)	1,009
Total comprehensive income	$	14,471		$	10,903		$	37,668		$	30,225

The accompanying notes are an integral part of the Unaudited Consolidated Financial Statements.

Page 5

BRYN MAWR BANK CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows - Unaudited

	Nine Months Ended September 30,
(dollars in thousands)	2018			2017
Operating activities:
Net income attributable to Bryn Mawr Bank Corporation	$	46,656		$	29,216
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan and lease losses	4,831			1,541
Depreciation of fixed assets	4,584			4,181
Net amortization of investment premiums and discounts	2,373			2,189
Net gain on sale of investment securities available for sale	(7		)	(73		)
Net gain on sale of loans	(1,677		)	(1,948		)
Stock based compensation	1,944			1,476
Amortization and net impairment of mortgage servicing rights	549			619
Net accretion of fair value adjustments	(7,023		)	(2,038		)
Amortization of intangible assets	2,659			2,057
Impairment of OREO and other repossessed assets	6			200
Net (gain) loss on sale of OREO	(292		)	12
Net increase in cash surrender value of bank owned life insurance ("BOLI")	(876		)	(602		)
Other, net	(7,387		)	2,130
Loans originated for resale	(72,545		)	(91,214		)
Proceeds from loans sold	73,650			95,599
Provision for deferred income taxes	4,768			325
Change in income taxes payable/receivable, net	6,033			(2,576		)
Change in accrued interest receivable	1,014			(754		)
Change in accrued interest payable	3,666			(467		)
Net cash provided by operating activities	62,926			39,873
Investing activities:
Purchases of investment securities available for sale	(115,381		)	(200,292		)
Purchases of investment securities held to maturity	(1,328		)	(3,466		)
Proceeds from maturity and paydowns of investment securities available for sale	259,102			259,765
Proceeds from maturity and paydowns of investment securities held to maturity	312			71
Proceeds from sale of investment securities available for sale	7			12,982
Net change in FHLB stock	5,405			1,057
Proceeds from calls of investment securities	310			22,180
Net change in other investments	(4,059		)	(314		)
Purchase of domain name	—			(151		)
Purchase of customer relationships	(215		)	—
Purchase of portfolio loans and leases	(14,974		)	—
Net portfolio loan and lease originations	(82,695		)	(142,416		)
Purchases of premises and equipment	(13,532		)	(5,251		)
Acquisitions, net of cash acquired	(380		)	(4,792		)
Capitalize costs to OREO	(24		)	(50		)
Proceeds from sale of OREO	430			375
Net cash provided by (used in) investing activities	32,978			(60,302		)
Financing activities:
Change in deposits	(15,542		)	104,558
Change in short-term borrowings	(11,367		)	(23,277		)
Dividends paid	(14,208		)	(11,043		)
Change in long-term FHLB advances and other borrowings	(66,371		)	(55,000		)
Payment of contingent consideration for business combinations	(660		)	(100		)
Cash payments to taxing authorities on employees' behalf from shares withheld from stock-based compensation	(1,489		)	(1,112		)
Net proceeds from sale of (purchase of) treasury stock for deferred compensation plans	52			(98		)
Repurchase of warrants from U.S. Treasury	(1,755		)	—
Net purchase of treasury stock through publicly announced plans	(690		)	—
Proceeds from exercise of stock options	1,456			1,288
Net cash (used in) provided by financing activities	(110,574		)	15,216
Change in cash and cash equivalents	(14,670		)	(5,213		)
Cash and cash equivalents at beginning of period	60,024			50,765
Cash and cash equivalents at end of period	$	45,354		$	45,552
Supplemental cash flow information:
Cash paid during the year for:
Income taxes	$	1,821		$	16,537
Interest	$	18,371		$	10,422
Non-cash information:
Change in other comprehensive loss	$	(8,988	)	$	1,009
Change in deferred tax due to change in comprehensive income	$	(2,389	)	$	544
Transfer of loans to OREO and repossessed assets	$	345		$	309
Acquisition of noncash assets and liabilities:
Assets acquired	$	1,466		$	7,284
Liabilities assumed	$	687		$	2,492

The accompanying notes are an integral part of the Unaudited Consolidated Financial Statements.

Page 6

BRYN MAWR BANK CORPORATION AND SUBSIDIARIES

Consolidated Statements of Changes In Shareholders’ Equity - Unaudited

(dollars in thousands, except share and per share data)

	For the Nine Months Ended September 30, 2018
	Shares of Common Stock Issued		Common Stock			Paid-in Capital			Treasury Stock			Accumulated Other Comprehensive Loss			Retained Earnings			Noncontrolling Interest			Total Shareholders' Equity
Balance December 31, 2017	24,360,049		$	24,360		$	371,486		$	(68,179	)	$	(4,414	)	$	205,549		$	(683	)	$	528,119
Net income attributable to Bryn Mawr Bank Corporation	—		—			—			—			—			46,656			—			46,656
Net income attributable to noncontrolling interest	—		—			—			—			—			—			5			5
Dividends paid or accrued, $0.69 per share	—		—			—			—			—			(14,099		)	—			(14,099		)
Other comprehensive loss, net of tax benefit of $2,389	—		—			—			—			(8,988		)	—			—			(8,988		)
Stock based compensation	—		—			1,944			—			—			—			—			1,944
Retirement of treasury stock	(2,253	)	(2		)	(20		)	22			—			—			—			—
Net purchase of treasury stock from stock awards for statutory tax withholdings	—		—			—			(1,489		)	—			—			—			(1,489		)
Net treasury stock activity for deferred compensation trusts	—		—			153			(101		)	—			—			—			52
Purchase of treasury stock through publicly announced plans	—		—			—			(690		)	—			—			—			(690		)
Repurchase of warrants from U.S. Treasury	—		—			(1,853		)	—			—			98			—			(1,755		)
Common stock issued:
Common stock issued through share-based awards and options exercises	172,387		172			1,385			—			—			—			—			1,557
Shares issued in acquisitions(1)	2,562		3			110			—			—			—			—			113
Balance September 30, 2018	24,532,745		$	24,533		$	373,205		$	(70,437	)	$	(13,402	)	$	238,204		$	(678	)	$	551,425

(1) Shares relating to the RBPI Merger (defined in Note 3 – Business Combinations below) recorded in April 2018.

The accompanying notes are an integral part of the Unaudited Consolidated Financial Statements.

Page 7

BRYN MAWR BANK CORPORATION AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

Note 1 - Basis of Presentation

The Unaudited Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). In the opinion of Bryn Mawr Bank Corporation’s (the “Corporation”) management, all adjustments necessary for a fair presentation of the consolidated financial position and the results of operations for the interim periods presented have been included. These Unaudited Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and notes thereto in the Corporation’s Annual Report on Form 10-K for the twelve months ended December 31, 2017 (the “2017 Annual Report”).

The results of operations for the three and nine months ended September 30, 2018 are not necessarily indicative of the results to be expected for the full year.

Principles of Consolidation

The Unaudited Consolidated Financial Statements include the accounts of the Corporation and its wholly owned subsidiaries; the Corporation’s primary subsidiary is The Bryn Mawr Trust Company (the “Bank”). In connection with the RBPI Merger (defined in Note 3 – Business Combinations below), the Corporation acquired two Delaware trusts, Royal Bancshares Capital Trust I and Royal Bancshares Capital Trust II. These two entities are not consolidated per requirements under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 810, “Consolidation” (“ASC Topic 810”). All significant intercompany balances and transactions have been eliminated in consolidation. Certain prior period amounts have been reclassified to conform to the current-year presentation.

Note 2 - Recent Accounting Pronouncements

The following FASB Accounting Standards Updates ("ASUs") are divided into pronouncements which have been adopted by the Corporation since January 1, 2018, and those which are not yet effective and have been evaluated or are currently being evaluated by management as of September 30, 2018.

Adopted Pronouncements:

FASB ASU 2014-9 (Topic 606), “Revenue from Contracts with Customers”

The Corporation adopted ASU 2014-9 Revenue from Contracts with Customers and all subsequent amendments to the ASU (collectively, “ASC 606”), which (i) creates a single framework for recognizing revenue from contracts with customers that fall within its scope and (ii) revises when it is appropriate to recognize a gain (loss) from the transfer of nonfinancial assets, such as OREO. The majority of the Corporation’s revenues come from interest income and other sources, including loans, leases, investment securities and derivatives, that are outside the scope of ASC 606. The Corporation’s services that fall within the scope of ASC 606 are presented within noninterest income and are recognized as revenue as the Corporation satisfies its obligation to the customer. Services within the scope of ASC 606 include service charges on deposits, Visa debit card income, wealth management fees, investment brokerage fees, and the net gain on sale of OREO. Refer to Note 17 Revenuefrom Contracts with Customers for further discussion on the Corporation’s accounting policies for revenue sources within the scope of ASC 606. The adoption of this ASU did not have an impact to our Consolidated Financial Statements and related disclosures.

FASB ASU 2017-1 (Topic 805), “Business Combinations”

The Corporation adopted ASU 2017-1, which clarifies the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The adoption of this ASU did not have a material impact on our Consolidated Financial Statements and related disclosures.

FASB ASU 2016-15 (Topic 320), “Classification of Certain Cash Receipts and Cash Payments”

The Corporation adopted ASU 2016-15, which provides guidance on eight specific cash flow issues and their disclosure in the consolidated statements of cash flows. The issues addressed include debt prepayment, settlement of zero-coupon debt,

Page 8

contingent consideration in business combinations, proceeds from settlement of insurance claims, proceeds from settlement of BOLI, distributions received from equity method investees, beneficial interests in securitization transactions, and separately identifiable cash flows and application of the predominance principle. The adoption of this ASU did not have a material impact on our Consolidated Financial Statements and related disclosures.

FASB ASU 2016-1 (Subtopic 825-10), “Financial Instruments – Overall, Recognition and Measurement of Financial Assets and Financial Liabilities”

The Corporation adopted ASU 2016-1 which requires that equity investments be measured at fair value with changes in fair value recognized in net income. The Corporation’s equity investments with a readily determinable fair value are currently included within trading securities and are measured at fair value with changes in fair value recognized in net income. In connection with the adoption of this ASU, the Corporation elected the practicability exception to fair value measurement for investments in equity securities without a readily determinable fair value (other than our Federal Home Loan Bank (“FHLB”), Federal Reserve Bank ("FRB"), and Atlantic Central Bankers Bank stock, which are outside of the scope of this ASU). Under the practicability exception, the investments are measured at cost, less impairment, plus or minus observable price changes (in orderly transactions) of an identical or similar investment of the same issuer. The adoption of this ASU did not have a material impact on our Consolidated Financial Statements and related disclosures.

FASB ASU 2017-7 (Topic 715), “Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost”

On January 1, 2018, the Corporation adopted ASU 2017-7 and all subsequent amendments to the ASU, which requires that an employer report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations, if one is presented. If a separate line item or items are used to present the other components of net benefit cost, that line item or items must be appropriately described. If a separate line item or items are not used, the line item or items used in the income statement to present the other components of net benefit cost must be disclosed. The amendments in this update also allow only the service cost component to be eligible for capitalization when applicable (for example, as a cost of internally manufactured inventory or a self-constructed asset).

Upon adoption, the components of net periodic benefit cost other than the service cost component were reclassified retrospectively from “Employee benefits” to “Other operating expenses” in the Consolidated Statements of Income. Since both “Employee benefits” and “Other operating expenses” line items are under “Noninterest expenses”, there was no impact to total “Noninterest expenses” or “Net income.” The components of net periodic benefit cost are currently disclosed in Note 17 – “Pension and Postretirement Benefit Plans” in the Notes to Consolidated Financial Statements found in our 2017 Annual Report. Additionally, the Corporation does not currently capitalize any components of its net periodic benefit costs. The adoption of this ASU did not have a material impact on our Consolidated Financial Statements and related disclosures.

Pronouncements Not Yet Effective:

FASB ASU 2018-07, “Improvements to Nonemployee Share-Based Payment Accounting”

Issued in June 2018, ASU 2018-07: Compensation - Stock Compensation (Topic 718), “Improvements to Nonemployee Share-Based Payment Accounting” expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. An entity should apply the requirements of Topic 718 to nonemployee awards except for specific guidance on inputs to an option pricing model and the attribution of cost (that is, the period of time over which share-based payment awards vest and the pattern of cost recognition over that period). The amendments specify that Topic 718 applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in a grantor’s own operations by issuing share-based payment awards. The amendments also clarify that Topic 718 does not apply to share-based payments used to effectively provide (1) financing to the issuer or (2) awards granted in conjunction with selling goods or services to customers as part of a contract accounted for under Topic 606, Revenue from Contracts with Customers. The amendments in this update are effective for public business entities for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. The Corporation has not historically granted share based payment awards to nonemployees other than to the Corporation’s Board of Directors, who are treated as employees for share-based payment accounting. As a result, management does not expect the adoption of this ASU to have an impact on our Consolidated Financial Statements and related disclosures.

Page 9

FASB ASU 2017-4 (Topic 350), “Intangibles – Goodwill and Others”

Issued in January 2017, ASU 2017-4 simplifies how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. Step 2 measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. ASU 2017-4 is effective for annual periods beginning after December 15, 2019 including interim periods within those periods. Management does not expect the adoption of this ASU to have a material impact on our Consolidated Financial Statements and related disclosures.

FASB ASU 2016-13 (Topic 326), “Measurement of Credit Losses on Financial Instruments”

Issued in June 2016, ASU 2016-13 significantly changes how companies measure and recognize credit impairment for many financial assets. The new current expected credit loss (“CECL”) model will require companies to immediately recognize an estimate of credit losses expected to occur over the remaining life of the financial assets that are in the scope of the standard. The ASU also makes targeted amendments to the current impairment model for available-for-sale debt securities. ASU 2016-13 is effective for the annual and interim periods in fiscal years beginning after December 15, 2019, with early adoption permitted. Adoption of this new guidance can be applied only on a prospective basis as a cumulative-effect adjustment to retained earnings.

It is expected that the new model will include different assumptions used in calculating credit losses, such as estimating losses over the estimated life of a financial asset, and will consider expected future changes in macroeconomic conditions. The adoption of this ASU may result in an increase to the Corporation’s allowance for credit losses, which will depend upon the nature and characteristics of the Corporation 's portfolio at the adoption date, as well as the macroeconomic conditions and forecasts at the adoption date. The Corporation has engaged the services of a third-party consultant as well as invested in software designed to assist management in the development and implementation of the new CECL model. Management has validated historical data uploaded within the third-party software and is beginning to develop the CECL model, including evaluating key assumptions such as portfolio segmentation, life of loan assumptions, and financial forecasts. The adoption of this ASU will also require the addition of an allowance for held-to-maturity debt securities. The Corporation currently does not intend to early adopt this new guidance.

FASB ASU 2016-2 (Topic 842), “Leases”

Issued in February 2016, ASU 2016-2 revises the accounting related to lessee accounting. Under the new guidance, lessees will be required to recognize a lease liability and right-of-use asset for all leases. The new lease guidance also simplifies the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and lease liabilities. ASU 2016-2 is effective for the first interim period within annual periods beginning after December 15, 2018, with early adoption permitted. The standard is required to be adopted using the modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. Management is in-process of migrating data and key assumptions into a third-party lease accounting software to calculate the lease liability and right-of-use asset for all existing leases of the Corporation. Management is aware that the adoption of this ASU will impact the Corporation’s balance sheet for the recording of assets and liabilities for operating leases. Any additional assets recorded as a result of implementation will have a negative impact on the Corporation and Bank capital ratios under current regulatory guidance.

FASB ASU 2018-12 (Topic 944), “Targeted Improvements to the Accounting for Long-Duration Contracts”

Issued in August 2018, ASU 2018-12 makes targeted improvements to the existing recognition, measurement, presentation, and disclosure requirements for long-duration contracts issued by an insurance entity. Specifically, the ASU is intended to 1) improve the timeliness of recognizing changes in the liability for future policy benefits and modify the rate used to discount future cash flows, 2) simplify and improve the accounting for certain market-based options or guarantees associated with deposit (or account balance) contracts, 3) simplify the amortization of deferred acquisition costs, and 4) improve the effectiveness of the required disclosures. ASU 2018-12 is effective for public business entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early application of the amendments is permitted. As an independent insurance agent, the Corporation does not issue insurance contracts. As a result, management does not expect the adoption of this ASU to have an impact on our Consolidated Financial Statements and related disclosures.

Page 10

Note 3 - Business Combinations

Domenick & Associates (“Domenick”)

The Bank’s subsidiary, BMT Insurance Advisors, Inc., completed the acquisition of Domenick, a full-service insurance agency established in 1993 and headquartered in the Old City section of Philadelphia, on May 1, 2018. The consideration paid was $1.5 million, of which $750 thousand was paid at closing, with three contingent cash payments, not to exceed $250 thousand each, to be payable on each of May 1, 2019, May 1, 2020, and May 1, 2021, subject to the attainment of certain targets during the related periods.

The following table details the consideration paid, the initial estimated fair value of identifiable assets acquired and liabilities assumed as of the date of acquisition and the resulting goodwill recorded:

(dollars in thousands)
Consideration paid:
Cash paid at closing	$	750
Contingent payment liability (present value)	706
Value of consideration	$	1,456
Assets acquired:
Cash and due from banks	370
Intangible assets - customer relationships	779
Premises and equipment	1
Other assets	316
Total assets	1,466
Liabilities assumed:
Accounts payable	657
Other liabilities	30
Total liabilities	$	687
Net assets acquired	$	779
Goodwill resulting from acquisition of Domenick	$	677

As of June 30, 2018, the estimates of the fair value of identifiable assets acquired and liabilities assumed in the Domenick acquisition were final.

Royal Bancshares of Pennsylvania, Inc.

On December 15, 2017, the previously announced merger of Royal Bancshares of Pennsylvania, Inc. (“RBPI”) with and into the Corporation (the “Effective Date”), and the merger of Royal Bank America with and into the Bank (collectively, the "RBPI Merger"), as contemplated by the Agreement and Plan of Merger, by and between RBPI and the Corporation, dated as of January 30, 2017 (the “Agreement”) was completed. In accordance with the Agreement, the aggregate share consideration paid to RBPI shareholders consisted of 3,101,316 shares of the Corporation’s common stock. Shareholders of RBPI received 0.1025 shares of Corporation common stock for each share of RBPI Class A common stock and 0.1179 shares of Corporation common stock for each share of RBPI Class B common stock owned as of the Effective Date of the RBPI Merger, with cash-in-lieu of fractional shares totaling $7 thousand. Holders of in-the-money options to purchase RBPI Class A common stock received cash totaling $112 thousand. In addition, 1,368,040 warrants to purchase Class A common stock of RBPI, valued at $1.9 million were converted to 140,224 warrants to purchase Corporation common stock. In accordance with the acquisition method of accounting, assets acquired and liabilities assumed were preliminarily adjusted to their fair values as of the Effective Date. The excess of consideration paid above the fair value of net assets acquired was recorded as goodwill. This goodwill is not amortizable nor is it deductible for income tax purposes.

Page 11

In connection with the RBPI Merger, the consideration paid and the estimated fair value of identifiable assets acquired and liabilities assumed as of the Effective Date, which include the effects of any measurement period adjustments in accordance with ASC 805-10, are summarized in the following table:

(dollars in thousands)
Consideration paid:
Common shares issued (3,101,316)	$	136,768
Cash in lieu of fractional shares	7
Cash-out of certain options	112
Fair value of warrants assumed	1,853
Value of consideration	$	138,740
Assets acquired:
Cash and due from banks	17,092
Investment securities available for sale	121,587
Loans	566,228
Premises and equipment	8,264
Deferred income taxes	34,586
Bank-owned life insurance	16,550
Core deposit intangible	4,670
Favorable lease asset	566
Other assets	13,996
Total assets	$	783,539
Liabilities assumed:
Deposits	593,172
FHLB and other long-term borrowings	59,568
Short-term borrowings	15,000
Junior subordinated debentures	21,416
Unfavorable lease liability	322
Other liabilities	31,381
Total liabilities	$	720,859
Net assets acquired	$	62,680
Goodwill resulting from acquisition of RBPI	$	76,060

Provisional Estimates of Fair Value of Certain Assets Acquired in the RBPI Merger

As of September 30, 2018, the accounting for the estimates of fair value for certain loans acquired in the RBPI Merger is incomplete. The Corporation is in the process of obtaining new information that will allow management to better estimate fair values that existed as of the Effective Date. When this information is obtained, management anticipates an adjustment to the provisional fair value assigned to certain acquired loans. These adjustments will result in corresponding adjustments to goodwill and net deferred tax asset. In accordance with ASC 805-10, the adjustments will be recorded in the period in which the new information about facts and circumstances that existed as of the Effective Date is obtained and reviewed.

During the nine months ended September 30, 2018, the Corporation adjusted certain provisional fair value estimates related to the RBPI Merger. The following table details the changes in fair value of the net assets acquired and liabilities assumed as of the Effective Date from the amounts originally reported in the 2017 Annual Report:

Page 12

(dollars in thousands)
Goodwill resulting from the acquisition of RBPI reported as of December 31, 2017	$	72,762
Value of Consideration Adjustment:
Common shares issued (2,562)	113
Fair Value Adjustments:
Loans	4,145
Other assets	491
Deferred income taxes	(1,451		)
Total Fair Value Adjustments	3,185
Goodwill from the acquisition of RBPI as of September 30, 2018	$	76,060

Methods Used to Fair Value Assets and Liabilities

For information regarding the valuation methodologies used to estimate the fair values of major categories of assets acquired and liabilities assumed, refer to Note 2 in the Notes to Consolidated Financial Statements in the 2017 Annual Report.

Loans Held for Investment

During the first and third quarters of 2018, new information became available related to certain loans acquired from RBPI which resulted in an adjustment to the fair value mark applied to acquired loans with evidence of credit quality deterioration. Loans meeting this definition were reviewed by comparing the contractual cash flows to expected collectible cash flows. The aggregate expected cash flows less the acquisition date fair value results in an accretable yield amount. The accretable yield amount will be recognized over the life of the loans or over the recovery period of the underlying collateral on a level yield basis as an adjustment to yield. As a result of the adjustments, the Corporation recorded increases of $3.0 million and $1.6 million in nonaccretable difference in the first and third quarters of 2018, respectively. The adjustment to the aggregate expected cash flows less the Effective Date fair value resulted in an increase in accretable yield of $325 thousand. There were no adjustments to the fair value mark applied to the acquired loan portfolio during the second quarter of 2018.

The following table provides an updated summary of the acquired impaired loans and leases as of the Effective Date, which include the effects of any measurement period adjustments in accordance with ASC 805-10, resulting from the RBPI Merger:

(dollars in thousands)
Contractually required principal and interest payments	$	40,741
Contractual cash flows not expected to be collected (nonaccretable difference)	(17,637		)
Cash flows expected to be collected	23,104
Interest component of expected cash flows (accretable yield)	(2,644		)
Fair value of loans acquired with deterioration of credit quality	$	20,460

Harry R. Hirshorn & Company, Inc., d/b/a Hirshorn Boothby (“Hirshorn”)

The acquisition of Hirshorn, an insurance agency headquartered in the Chestnut Hill section of Philadelphia, was completed on May 24, 2017. Immediately after the acquisition, Hirshorn was merged into the Bank’s existing insurance subsidiary, BMT Insurance Advisors, Inc., formerly known as Powers Craft Parker and Beard, Inc. The consideration paid by the Bank was $7.5 million, of which $5.8 million was paid at closing, one contingent cash payment of $575 thousand was paid during the second quarter of 2018, and two contingent cash payments, not to exceed $575 thousand each, to be payable on each of May 24, 2019 and May 24, 2020, subject to the attainment of certain targets during the related periods. The acquisition enhanced the Bank’s ability to offer comprehensive insurance solutions to both individual and business clients and continues the strategy of selectively establishing specialty offices in targeted areas.

Page 13

In connection with the Hirshorn acquisition, the following table details the consideration paid, the initial estimated fair value of identifiable assets acquired and liabilities assumed as of the date of acquisition and the resulting goodwill recorded:

(dollars in thousands)
Consideration paid:
Cash paid at closing	$	5,770
Contingent payment liability (present value)	1,690
Value of consideration	7,460
Assets acquired:
Cash operating accounts	978
Intangible assets – trade name	195
Intangible assets – customer relationships	2,672
Intangible assets – non-competition agreements	41
Premises and equipment	1,795
Accounts receivable	192
Other assets	27
Total assets	5,900
Liabilities assumed:
Accounts payable	800
Other liabilities	2
Total liabilities	802
Net assets acquired	5,098
Goodwill resulting from acquisition of Hirshorn	$	2,362

As of December 31, 2017, the estimates of the fair value of identifiable assets acquired and liabilities assumed in the Hirshorn acquisition were final.

Pro Forma Income Statements (unaudited)

The following table presents the pro forma income statement of the combined institution (RBPI and the Corporation) for the three and nine months ended September 30, 2017 as if the RBPI Merger had occurred on January 1, 2017. The pro forma income statement adjustments are limited to the effects of purchase accounting fair value mark amortization and accretion and intangible asset amortization. No cost savings or additional merger expenses have been included in the pro forma income statement. Due to the immaterial contribution to net income of the Hirshorn acquisition, which occurred during the year shown in the table, the pro forma effects of the Hirshorn acquisition have been excluded.

Page 14

(dollars in thousands)	Three Months Ended September 30, 2017		Nine Months Ended September 30, 2017
Total interest income	$	43,412	$	126,976
Total interest expense	5,480		15,013
Net interest income	37,932		111,963
Provision for loan and lease losses	1,492		2,054
Net interest income after provision for loan and lease losses	36,440		109,909
Total noninterest income	16,015		45,481
Total noninterest expenses*	33,364		99,699
Income before income taxes	19,091		55,691
Income tax expense	5,843		18,306
Net income	$	13,248	$	37,385
Per share data**:
Weighted-average basic shares outstanding	20,121,800		20,086,253
Dilutive shares	261,935		284,294
Adjusted weighted-average diluted shares	20,383,735		20,370,547
Basic earnings per common share	$	0.66	$	1.86
Diluted earnings per common share	$	0.65	$	1.84

*Total noninterest expense includes RBPI Net Income Attributable to Noncontrolling Interest and Preferred Stock Series A Accumulated Dividend and Accretion for pro forma presentation.

**Assumes that the shares of RBPI common stock outstanding as of December 31, 2017 were outstanding for the full three and nine month periods ended September 30, 2017.

Due Diligence, Merger-Related and Merger Integration Expenses

Due diligence, merger-related and merger integration expenses include consultant costs, investment banker fees, contract breakage fees, retention bonuses for severed employees, salary and wages for redundant staffing involved in the integration of the institutions and bonus accruals for members of the merger integration team. The following table details the costs identified and classified as due diligence, merger-related and merger integration costs for the periods indicated:

	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2018		2017		2018		2017
Advertising	$	—	$	89	$	61	$	108
Employee Benefits	—		5		271		10
Occupancy and bank premises	—		—		2,145		—
Furniture, fixtures, and equipment	—		31		365		37
Information technology	167		41		421		300
Professional fees	193		632		1,450		1,570
Salaries and wages	29		28		852		428
Other	—		24		2,196		144
Total due diligence, merger-related and merger integration expenses	$	389	$	850	$	7,761	$	2,597

Page 15

Note 4 - Investment Securities

The amortized cost and fair value of investment securities available for sale as of September 30, 2018 and December 31, 2017 are as follows:

As of September 30, 2018

(dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U.S. Treasury securities	$	100	$	—	$	—		$	100
Obligations of the U.S. government and agencies	196,334		17		(5,898		)	190,453
Obligations of state and political subdivisions	15,890		1		(92		)	15,799
Mortgage-backed securities	292,005		344		(7,928		)	284,421
Collateralized mortgage obligations	37,811		—		(1,618		)	36,193
Other investment securities	1,100		—		(2		)	1,098
Total	$	543,240	$	362	$	(15,538	)	$	528,064

As of December 31, 2017

(dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U.S. Treasury securities	$	200,077	$	11	$	—		$	200,088
Obligations of the U.S. government and agencies	153,028		75		(2,059		)	151,044
Obligations of state and political subdivisions	21,352		11		(53		)	21,310
Mortgage-backed securities	275,958		887		(1,855		)	274,990
Collateralized mortgage obligations	37,596		14		(948		)	36,662
Other investment securities	4,813		318		(23		)	5,108
Total	$	692,824	$	1,316	$	(4,938	)	$	689,202

The following tables present the aggregate amount of gross unrealized losses as of September 30, 2018 and December 31, 2017 on available for sale investment securities classified according to the amount of time those securities have been in a continuous unrealized loss position:

As of September 30, 2018

	Less than 12 Months					12 Months or Longer					Total
(dollars in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Obligations of the U.S. government and agencies	$	82,187	$	(1,634	)	$	107,601	$	(4,264	)	$	189,788	$	(5,898	)
Obligations of state and political subdivisions	11,009		(21		)	2,303		(71		)	13,312		(92		)
Mortgage-backed securities	136,170		(3,037		)	130,269		(4,891		)	266,439		(7,928		)
Collateralized mortgage obligations	10,939		(86		)	24,945		(1,532		)	35,884		(1,618		)
Other investment securities	549		(1		)	249		(1		)	798		(2		)
Total	$	240,854	$	(4,779	)	$	265,367	$	(10,759	)	$	506,221	$	(15,538	)

Page 16

As of December 31, 2017

	Less than 12 Months					12 Months or Longer					Total
(dollars in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Obligations of the U.S. government and agencies	$	114,120	$	(1,294	)	$	26,726	$	(765	)	$	140,846	$	(2,059	)
Obligations of state and political subdivisions	11,144		(29		)	2,709		(24		)	13,853		(53		)
Mortgage-backed securities	177,919		(1,293		)	31,787		(562		)	209,706		(1,855		)
Collateralized mortgage obligations	5,166		(47		)	26,686		(901		)	31,852		(948		)
Other investment securities	1,805		(23		)	—		—			1,805		(23		)
Total	$	310,154	$	(2,686	)	$	87,908	$	(2,252	)	$	398,062	$	(4,938	)

Management evaluates the Corporation’s investment securities that are in an unrealized loss position in order to determine if the decline in fair value is other than temporary. The investment portfolio includes debt securities issued by U.S. government agencies, U.S. government-sponsored agencies, state and local municipalities and other issuers. All fixed income investment securities in the Corporation’s investment portfolio are rated as investment-grade or higher. Factors considered in the evaluation include the current economic climate, the length of time and the extent to which the fair value has been below cost, interest rates and the bond rating of each security. The unrealized losses presented in the tables above are temporary in nature and are primarily related to market interest rates rather than the underlying credit quality of the issuers or collateral. Management does not believe that these unrealized losses are other-than-temporary. Management does not have the intent to sell these securities prior to their maturity or the recovery of their cost bases and believes that it is more likely than not that it will not have to sell these securities prior to their maturity or the recovery of their cost bases.

As of September 30, 2018 and December 31, 2017, securities having a fair value of $121.1 million and $126.2 million, respectively, were specifically pledged as collateral for public funds, trust deposits, the FRB discount window program, FHLB borrowings and other purposes. Advances by the FHLB are collateralized by a blanket lien on non-pledged, mortgage-related loans as part of the Corporation’s borrowing agreement with the FHLB as well as certain securities individually pledged by the Corporation.

The amortized cost and fair value of available for sale investment and mortgage-related securities available for sale as of September 30, 2018 and December 31, 2017, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities as borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

	September 30, 2018				December 31, 2017
(dollars in thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Investment securities:
Due in one year or less	$	12,265	$	12,237	$	211,019	$	211,019
Due after one year through five years	176,700		171,374		126,452		124,797
Due after five years through ten years	24,459		23,839		23,147		22,804
Due after ten years	—		—		15,439		15,421
Subtotal	213,424		207,450		376,057		374,041
Mortgage-related securities(1)	329,816		320,614		313,554		311,652
Mutual funds with no stated maturity	—		—		3,213		3,509
Total	$	543,240	$	528,064	$	692,824	$	689,202

(1) Expected maturities of mortgage-related securities may differ from contractual maturities as borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

Page 17

The amortized cost and fair value of investment securities held to maturity as of September 30, 2018 and December 31, 2017 are as follows:

As of September 30, 2018

(dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Mortgage-backed securities	$	8,916	$	—	$	(372	)	$	8,544

As of December 31, 2017

(dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Mortgage-backed securities	$	7,932	$	5	$	(86	)	$	7,851

The following tables present the aggregate amount of gross unrealized losses as of September 30, 2018 and December 31, 2017 on held to maturity securities classified according to the amount of time those securities have been in a continuous unrealized loss position:

As of September 30, 2018

	Less than 12 Months					12 Months or Longer					Total
(dollars in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Mortgage-backed securities	$	3,882	$	(132	)	$	4,662	$	(240	)	$	8,544	$	(372	)

As of December 31, 2017

	Less than 12 Months					12 Months or Longer					Total
(dollars in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Mortgage-backed securities	$	2,756	$	(25	)	$	3,866	$	(61	)	$	6,622	$	(86	)

The amortized cost and fair value of held to maturity investment securities as of September 30, 2018 and December 31, 2017, by contractual maturity, are shown below:

	September 30, 2018				December 31, 2017
(dollars in thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Mortgage-backed securities(1)	$	8,916	$	8,544	$	7,932	$	7,851

(1) Expected maturities of mortgage-related securities may differ from contractual maturities as borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

As of September 30, 2018 and December 31, 2017, the Corporation’s investment securities held in trading accounts totaled $8.3 million and $4.6 million, respectively, and primarily consist of deferred compensation trust accounts which are invested in listed mutual funds whose diversification is at the discretion of the deferred compensation plan participants and a rabbi trust account established to fund certain unqualified pension obligations. During the first quarter of 2018, $3.2 million of investment securities included within the rabbi trust account were reclassified from available for sale to trading. Investment securities held in trading accounts are reported at fair value, with adjustments in fair value reported through income.

Page 18

Note 5 -Loans and Leases

The loan and lease portfolio consists of loans and leases originated by the Corporation, as well as loans acquired in mergers and acquisitions. These mergers and acquisitions include the December 2017 RBPI Merger, the January 2015 Continental Bank Holdings, Inc. Merger, the November 2012 transaction with First Bank of Delaware, and the July 2010 acquisition of First Keystone Financial, Inc. Certain tables in this footnote are presented with a breakdown between originated and acquired loans and leases.

A. The table below detailsportfolio loans and leases as of the dates indicated:

	September 30, 2018						December 31, 2017
(dollars in thousands)	Originated		Acquired		Total Loans and Leases		Originated		Acquired		Total Loans and Leases
Loans held for sale	$	4,111	$	—	$	4,111	$	3,794	$	—	$	3,794
Real Estate Loans:
Commercial mortgage	$	1,259,397	$	359,096	$	1,618,493	$	1,122,327	$	401,050	$	1,523,377
Home equity lines and loans	180,068		27,738		207,806		183,283		34,992		218,275
Residential mortgage	381,037		86,365		467,402		360,935		97,951		458,886
Construction	158,691		19,802		178,493		128,266		84,188		212,454
Total real estate loans	$	1,979,193	$	493,001	$	2,472,194	$	1,794,811	$	618,181	$	2,412,992
Commercial and industrial	618,200		104,799		722,999		589,304		130,008		719,312
Consumer	44,833		2,976		47,809		35,146		3,007		38,153
Leases	109,934		28,539		138,473		68,035		47,366		115,401
Total portfolio loans and leases	$	2,752,160	$	629,315	$	3,381,475	$	2,487,296	$	798,562	$	3,285,858
Total loans and leases	$	2,756,271	$	629,315	$	3,385,586	$	2,491,090	$	798,562	$	3,289,652
Loans with fixed rates	$	1,167,097	$	375,326	$	1,542,423	$	1,034,542	$	538,510	$	1,573,052
Loans with adjustable or floating rates	1,589,174		253,989		1,843,163		1,456,548		260,052		1,716,600
Total loans and leases	$	2,756,271	$	629,315	$	3,385,586	$	2,491,090	$	798,562	$	3,289,652
Net deferred loan origination fees included in the above loan table	$	1,220	$	—	$	1,220	$	887	$	—	$	887

B. Components of the net investment in leases are detailed as follows:

	September 30, 2018									December 31, 2017
(dollars in thousands)	Originated			Acquired			Total Leases			Originated			Acquired			Total Leases
Minimum lease payments receivable	$	122,596		$	32,039		$	154,635		$	75,592		$	55,219		$	130,811
Unearned lease income	(17,717		)	(4,293		)	(22,010		)	(10,338		)	(9,523		)	(19,861		)
Initial direct costs and deferred fees	5,055			793			5,848			2,781			1,670			4,451
Total Leases	$	109,934		$	28,539		$	138,473		$	68,035		$	47,366		$	115,401

Page 19

C. Non-Performing Loans and Leases⁽¹⁾  

	September 30, 2018						December 31, 2017
(dollars in thousands)	Originated		Acquired		Total Loans and Leases		Originated		Acquired		Total Loans and Leases
Commercial mortgage	$	—	$	735	$	735	$	90	$	782	$	872
Home equity lines and loans	1,692		241		1,933		1,221		260		1,481
Residential mortgage	1,968		802		2,770		1,505		2,912		4,417
Construction	291		—		291		—		—		—
Commercial and industrial	925		857		1,782		826		880		1,706
Consumer	42		75		117		—		—		—
Leases	479		883		1,362		103		—		103
Total non-performing loans and leases	$	5,397	$	3,593	$	8,990	$	3,745	$	4,834	$	8,579

(1) Purchased credit-impaired loans, which have been recorded at their fair values at acquisition, and which are performing, are excluded from this table, with theexception of$393 thousandand $167 thousand of purchased credit-impaired loans as of September 30, 2018 and December 31, 2017,respectively, which became non-performing subsequent to acquisition.

D. Purchased Credit-Impaired Loans

The outstanding principal balance and related carrying amount of purchased credit-impaired loans, for which the Corporation applies ASC 310-30, Accounting for Purchased Loans with Deteriorated Credit Quality, to account for the interest earned, as of the dates indicated, are as follows:

(dollars in thousands)	September 30, 2018		December 31, 2017
Outstanding principal balance	$	38,062	$	46,543
Carrying amount(1)	$	27,519	$	30,849

(1) Includes $393 thousand and $173 thousand of purchased credit-impaired loans as of September 30, 2018 and December 31, 2017, respectively, for which the Corporation could not estimate the timing or amount of expected cash flows to be collected at acquisition, and for which no accretable yield is recognized. Additionally, the table above includes $393 thousand and $167 thousand of purchased credit-impaired loans as of September 30, 2018 and December 31, 2017, respectively, which became non-performing subsequent to acquisition, which are disclosed in Note 5C, above, and which also have no accretable yield.

The following table presents changes in the accretable discount on purchased credit-impaired loans, for which the Corporation applies ASC 310-30, for the nine months ended September 30, 2018: 

(dollars in thousands)	Accretable Discount
Balance, December 31, 2017	$	4,083
Accretion	(1,819		)
Reclassifications from nonaccretable difference	609
Additions/adjustments	329
Balance, September 30, 2018	$	3,202

Page 20

E. Age Analysis of Past Due Loans and Leases

The following tables present an aging of all portfolio loans and leases as of the dates indicated:

	Accruing Loans and Leases
As of September 30, 2018	30 – 59 Days Past Due		60 – 89 Days Past Due		Over 89 Days Past Due		Total Past Due		Current*		Total Accruing Loans and Leases		Nonaccrual Loans and Leases		Total Loans and Leases
(dollars in thousands)
Commercial mortgage	$	—	$	2,468	$	—	$	2,468	$	1,615,290	$	1,617,758	$	735	$	1,618,493
Home equity lines and loans	324		—		—		324		205,549		205,873		1,933		207,806
Residential mortgage	2,218		179		—		2,397		462,235		464,632		2,770		467,402
Construction	488		—		—		488		177,714		178,202		291		178,493
Commercial and industrial	1,115		1,255		—		2,370		718,847		721,217		1,782		722,999
Consumer	46		23		—		69		47,623		47,692		117		47,809
Leases	751		252		—		1,003		136,108		137,111		1,362		138,473
Total portfolio loans and leases	$	4,942	$	4,177	$	—	$	9,119	$	3,363,366	$	3,372,485	$	8,990	$	3,381,475

	Accruing Loans and Leases
As of December 31, 2017	30 – 59 Days Past Due		60 – 89 Days Past Due		Over 89 Days Past Due		Total Past Due		Current*		Total Accruing Loans and Leases		Nonaccrual Loans and Leases		Total Loans and Leases
(dollars in thousands)
Commercial mortgage	$	1,366	$	2,428	$	—	$	3,794	$	1,518,711	$	1,522,505	$	872	$	1,523,377
Home equity lines and loans	338		10		—		348		216,446		216,794		1,481		218,275
Residential mortgage	1,386		79		—		1,465		453,004		454,469		4,417		458,886
Construction	—		—		—		—		212,454		212,454		—		212,454
Commercial and industrial	658		286		—		944		716,662		717,606		1,706		719,312
Consumer	1,106		—		—		1,106		37,047		38,153		—		38,153
Leases	125		177		—		302		114,996		115,298		103		115,401
Total portfolio loans and leases	$	4,979	$	2,980	$	—	$	7,959	$	3,269,320	$	3,277,279	$	8,579	$	3,285,858

*Included as “current” are $720 thousand and $4.1 million of loans and leases as of September 30, 2018 and December 31, 2017, respectively, which are classified as administratively delinquent. An administratively delinquent loan is one which has been approved for a renewal or extension but has not had all the required documents fully executed as of the reporting date. Management does not consider these loans to be delinquent.

The following tables present an aging of originated portfolio loans and leases as of the dates indicated:

	Accruing Loans and Leases
As of September 30, 2018	30 – 59 Days Past Due		60 – 89 Days Past Due		Over 89 Days Past Due		Total Past Due		Current*		Total Accruing Loans and Leases		Nonaccrual Loans and Leases		Total Loans and Leases
(dollars in thousands)
Commercial mortgage	$	—	$	76	$	—	$	76	$	1,259,321	$	1,259,397	$	—	$	1,259,397
Home equity lines and loans	250		—		—		250		178,126		178,376		1,692		180,068
Residential mortgage	1,475		—		—		1,475		377,594		379,069		1,968		381,037
Construction	488		—		—		488		157,912		158,400		291		158,691
Commercial and industrial	1,051		1,255		—		2,306		614,969		617,275		925		618,200
Consumer	46		23		—		69		44,722		44,791		42		44,833
Leases	407		115		—		522		108,933		109,455		479		109,934
Total originated portfolio loans and leases	$	3,717	$	1,469	$	—	$	5,186	$	2,741,577	$	2,746,763	$	5,397	$	2,752,160

Page 21

	Accruing Loans and Leases
As of December 31, 2017	30 – 59 Days Past Due		60 – 89 Days Past Due		Over 89 Days Past Due		Total Past Due		Current*		Total Accruing Loans and Leases		Nonaccrual Loans and Leases		Total Loans and Leases
(dollars in thousands)
Commercial mortgage	$	1,255	$	81	$	—	$	1,336	$	1,120,901	$	1,122,237	$	90	$	1,122,327
Home equity lines and loans	26		—		—		26		182,036		182,062		1,221		183,283
Residential mortgage	721		—		—		721		358,709		359,430		1,505		360,935
Construction	—		—		—		—		128,266		128,266		—		128,266
Commercial and industrial	439		236		—		675		587,803		588,478		826		589,304
Consumer	21		—		—		21		35,125		35,146		—		35,146
Leases	125		177		—		302		67,630		67,932		103		68,035
Total originated portfolio loans and leases	$	2,587	$	494	$	—	$	3,081	$	2,480,470	$	2,483,551	$	3,745	$	2,487,296

*Included as “current” are $720 thousand and $4.0 million of loans and leases as of September 30, 2018 and December 31, 2017, respectively, which are classified as administratively delinquent. An administratively delinquent loan is one which has been approved for a renewal or extension but has not had all the required documents fully executed as of the reporting date. Management does not consider these loans to be delinquent.

The following tables present an aging of acquired portfolio loans and leases as of the dates indicated:

	Accruing Loans and Leases
As of September 30, 2018	30 – 59 Days Past Due		60 – 89 Days Past Due		Over 89 Days Past Due		Total Past Due		Current*		Total Accruing Loans and Leases		Nonaccrual Loans and Leases		Total Loans and Leases
(dollars in thousands)
Commercial mortgage	$	—	$	2,392	$	—	$	2,392	$	355,969	$	358,361	$	735	$	359,096
Home equity lines and loans	74		—		—		74		27,423		27,497		241		27,738
Residential mortgage	743		179		—		922		84,641		85,563		802		86,365
Construction	—		—		—		—		19,802		19,802		—		19,802
Commercial and industrial	64		—		—		64		103,878		103,942		857		104,799
Consumer	—		—		—		—		2,901		2,901		75		2,976
Leases	344		137		—		481		27,175		27,656		883		28,539
Total acquired portfolio loans and leases	$	1,225	$	2,708	$	—	$	3,933	$	621,789	$	625,722	$	3,593	$	629,315

	Accruing Loans and Leases
As of December 31, 2017	30 – 59 Days Past Due		60 – 89 Days Past Due		Over 89 Days Past Due		Total Past Due		Current*		Total Accruing Loans and Leases		Nonaccrual Loans and Leases		Total Loans and Leases
(dollars in thousands)
Commercial mortgage	$	111	$	2,347	$	—	$	2,458	$	397,810	$	400,268	$	782	$	401,050
Home equity lines and loans	312		10		—		322		34,410		34,732		260		34,992
Residential mortgage	665		79		—		744		94,295		95,039		2,912		97,951
Construction	—		—		—		—		84,188		84,188		—		84,188
Commercial and industrial	219		50		—		269		128,859		129,128		880		130,008
Consumer	1,085		—		—		1,085		1,922		3,007		—		3,007
Leases	—		—		—		—		47,366		47,366		—		47,366
Total acquired portfolio loans and leases	$	2,392	$	2,486	$	—	$	4,878	$	788,850	$	793,728	$	4,834	$	798,562

*Included as “current” are $0 and $102 thousand of loans and leases as of September 30, 2018 and December 31, 2017, respectively, which are classified as administratively delinquent. An administratively delinquent loan is one which has been approved for a renewal or extension but has not had all the required documents fully executed as of the reporting date. Management does not consider these loans to be delinquent.

Page 22

F. Allowance for Loan and Lease Losses (the “Allowance”)

The following tables detail the roll-forward of the Allowance for the three and nine months ended September 30, 2018 and 2017:

(dollars in thousands)	Commercial Mortgage			Home Equity Lines and Loans			Residential Mortgage			Construction		Commercial and Industrial			Consumer			Leases			Unallocated		Total
Balance, December 31, 2017	$	7,550		$	1,086		$	1,926		$	937	$	5,038		$	246		$	742		$	—	$	17,525
Charge-offs	(74		)	(225		)	(42		)	—		(1,069		)	(165		)	(2,416		)	—		(3,991		)
Recoveries	8			1			55			1		17			5			232			—		319
Provision for loan and lease losses	60			30			(121		)	303		1,319			232			3,008			—		4,831
Balance, September 30, 2018	$	7,544		$	892		$	1,818		$	1,241	$	5,305		$	318		$	1,566		$	—	$	18,684

(dollars in thousands)	Commercial Mortgage			Home Equity Lines and Loans			Residential Mortgage			Construction		Commercial and Industrial			Consumer			Leases			Unallocated		Total
Balance, June 30, 2018	$	8,033		$	933		$	1,933		$	1,158	$	5,672		$	289		$	1,380		$	—	$	19,398
Charge-offs	(58		)	—			(42		)	—		(319		)	(73		)	(1,068		)	—		(1,560		)
Recoveries	2			—			54			—		16			2			108			—		182
Provision for loan and lease losses	(433		)	(41		)	(127		)	83		(64		)	100			1,146			—		664
Balance, September 30, 2018	$	7,544		$	892		$	1,818		$	1,241	$	5,305		$	318		$	1,566		$	—	$	18,684

(dollars in thousands)	Commercial Mortgage		Home Equity Lines and Loans			Residential Mortgage			Construction			Commercial and Industrial			Consumer			Leases			Unallocated		Total
Balance, December 31, 2016	$	6,227	$	1,255		$	1,917		$	2,233		$	5,142		$	153		$	559		$	—	$	17,486
Charge-offs	—		(676		)	(158		)	—			(560		)	(96		)	(924		)	—		(2,414		)
Recoveries	9		—			85			3			18			5			271			—		391
Provision for loan and lease losses	1,096		513			(23		)	(1,306		)	280			148			833			—		1,541
Balance, September 30, 2017	$	7,332	$	1,092		$	1,821		$	930		$	4,880		$	210		$	739		$	—	$	17,004

Page 23

(dollars in thousands)	Commercial Mortgage		Home Equity Lines and Loans			Residential Mortgage			Construction			Commercial and Industrial			Consumer			Leases			Unallocated		Total
Balance, June 30, 2017	$	6,608	$	1,214		$	1,776		$	1,111		$	4,813		$	177		$	700		$	—	$	16,399
Charge-offs	—		(69		)	(88		)	—			(301		)	(37		)	(411		)	—		(906		)
Recoveries	3		—			85			1			2			1			86			—		178
Provision for loan and lease losses	721		(53		)	48			(182		)	366			69			364			—		1,333
Balance, September 30, 2017	$	7,332	$	1,092		$	1,821		$	930		$	4,880		$	210		$	739		$	—	$	17,004

The following tables detail the allocation of the Allowance for all portfolio loans and leases by portfolio segment based on the methodology used to evaluate the loans and leases for impairment as of September 30, 2018 and December 31, 2017:

As of September 30, 2018	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Unallocated		Total
(dollars in thousands)
Allowance on loans and leases:
Individually evaluated for impairment	$	—	$	19	$	228	$	—	$	11	$	20	$	—	$	—	$	278
Collectively evaluated for impairment	7,544		873		1,590		1,241		5,294		298		1,566		—		18,406
Purchased credit-impaired(1)	—		—		—		—		—		—		—		—		—
Total	$	7,544	$	892	$	1,818	$	1,241	$	5,305	$	318	$	1,566	$	—	$	18,684

⁽¹⁾ Purchased credit-impaired loans are evaluated for impairment on an individual basis.

As of December 31, 2017	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Unallocated		Total
(dollars in thousands)
Allowance on loans and leases:
Individually evaluated for impairment	$	—	$	19	$	230	$	—	$	5	$	4	$	—	$	—	$	258
Collectively evaluated for impairment	7,550		1,067		1,696		937		5,033		242		742		—		17,267
Purchased credit-impaired(1)	—		—		—		—		—		—		—		—		—
Total	$	7,550	$	1,086	$	1,926	$	937	$	5,038	$	246	$	742	$	—	$	17,525

⁽¹⁾ Purchased credit-impaired loans are evaluated for impairment on an individual basis.

Page 24

The following tables detail the carrying value for all portfolio loans and leases by portfolio segment based on the methodology used to evaluate the loans and leases for impairment as of September 30, 2018 and December 31, 2017:

As of September 30, 2018	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Carrying value of loans and leases:
Individually evaluated for impairment	$	736	$	2,602	$	5,940	$	291	$	1,757	$	144	$	—	$	11,470
Collectively evaluated for impairment	1,609,375		204,694		461,462		175,802		705,015		47,665		138,473		3,342,486
Purchased credit-impaired(1)	8,382		510		—		2,400		16,227		—		—		27,519
Total	$	1,618,493	$	207,806	$	467,402	$	178,493	$	722,999	$	47,809	$	138,473	$	3,381,475

⁽¹⁾ Purchased credit-impaired loans are evaluated for impairment on an individual basis.

As of December 31, 2017	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Carrying value of loans and leases:
Individually evaluated for impairment	$	2,128	$	2,162	$	7,726	$	—	$	1,897	$	27	$	—	$	13,940
Collectively evaluated for impairment	1,503,825		215,604		451,160		204,088		712,865		38,126		115,401		3,241,069
Purchased credit-impaired(1)	17,424		509		—		8,366		4,550		—		—		30,849
Total	$	1,523,377	$	218,275	$	458,886	$	212,454	$	719,312	$	38,153	$	115,401	$	3,285,858

⁽¹⁾ Purchased credit-impaired loans are evaluated for impairment on an individual basis.

The following tables detail the allocation of the Allowance for originated portfolio loans and leases by portfolio segment based on the methodology used to evaluate the loans and leases for impairment as of September 30, 2018 and December 31, 2017:

As of September 30, 2018	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Allowance on loans and leases:
Individually evaluated for impairment	$	—	$	19	$	179	$	—	$	4	$	4	$	—	$	206
Collectively evaluated for impairment	7,544		873		1,590		1,241		5,294		298		1,566		18,406
Total	$	7,544	$	892	$	1,769	$	1,241	$	5,298	$	302	$	1,566	$	18,612

Page 25

As of December 31, 2017	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Allowance on loans and leases:
Individually evaluated for impairment	$	—	$	19	$	180	$	—	$	5	$	4	$	—	$	208
Collectively evaluated for impairment	7,550		1,067		1,696		937		5,033		242		742		17,267
Total	$	7,550	$	1,086	$	1,876	$	937	$	5,038	$	246	$	742	$	17,475

The following tables detail the carrying value for originated portfolio loans and leases by portfolio segment based on the methodology used to evaluate the loans and leases for impairment as of September 30, 2018 and December 31, 2017:

As of September 30, 2018	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Carrying value of loans and leases:
Individually evaluated for impairment	$	—	$	2,361	$	4,268	$	291	$	1,294	$	68	$	—	$	8,282
Collectively evaluated for impairment	1,259,397		177,707		376,769		158,400		616,906		44,765		109,934		2,743,878
Total	$	1,259,397	$	180,068	$	381,037	$	158,691	$	618,200	$	44,833	$	109,934	$	2,752,160

As of December 31, 2017	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Carrying value of loans and leases:
Individually evaluated for impairment	$	1,345	$	1,902	$	4,418	$	—	$	1,186	$	27	$	—	$	8,878
Collectively evaluated for impairment	1,120,982		181,381		356,517		128,266		588,118		35,119		68,035		2,478,418
Total	$	1,122,327	$	183,283	$	360,935	$	128,266	$	589,304	$	35,146	$	68,035	$	2,487,296

The following tables detail the allocation of the Allowance for acquired portfolio loans and leases by portfolio segment based on the methodology used to evaluate the loans and leases for impairment as of September 30, 2018 and December 31, 2017:

As of September 30, 2018	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Allowance on loans and leases:
Individually evaluated for impairment	$	—	$	—	$	49	$	—	$	7	$	16	$	—	$	72
Collectively evaluated for impairment	—		—		—		—		—		—		—		—
Purchased credit-impaired(1)	—		—		—		—		—		—		—		—
Total	$	—	$	—	$	49	$	—	$	7	$	16	$	—	$	72

⁽¹⁾ Purchased credit-impaired loans are evaluated for impairment on an individual basis.

Page 26

As of December 31, 2017	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Allowance on loans and leases:
Individually evaluated for impairment	$	—	$	—	$	50	$	—	$	—	$	—	$	—	$	50
Collectively evaluated for impairment	—		—		—		—		—		—		—		—
Purchased credit-impaired(1)	—		—		—		—		—		—		—		—
Total	$	—	$	—	$	50	$	—	$	—	$	—	$	—	$	50

⁽¹⁾ Purchased credit-impaired loans are evaluated for impairment on an individual basis.

The following tables detail the carrying value for acquired portfolio loans and leases by portfolio segment based on the methodology used to evaluate the loans and leases for impairment as of September 30, 2018 and December 31, 2017:

As of September 30, 2018	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Carrying value of loans and leases:
Individually evaluated for impairment	$	736	$	241	$	1,672	$	—	$	463	$	76	$	—	$	3,188
Collectively evaluated for impairment	349,978		26,987		84,693		17,402		88,109		2,900		28,539		598,608
Purchased credit-impaired(1)	8,382		510		—		2,400		16,227		—		—		27,519
Total	$	359,096	$	27,738	$	86,365	$	19,802	$	104,799	$	2,976	$	28,539	$	629,315

⁽¹⁾Purchased credit-impaired loans are evaluated for impairment on an individual basis.

As of December 31, 2017	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Carrying value of loans and leases:
Individually evaluated for impairment	$	783	$	260	$	3,308	$	—	$	711	$	—	$	—	$	5,062
Collectively evaluated for impairment	382,843		34,223		94,643		75,822		124,747		3,007		47,366		762,651
Purchased credit-impaired(1)	17,424		509		—		8,366		4,550		—		—		30,849
Total	$	401,050	$	34,992	$	97,951	$	84,188	$	130,008	$	3,007	$	47,366	$	798,562

⁽¹⁾Purchased credit-impaired loans are evaluated for impairment on an individual basis.

As part of the process of determining the Allowance for the different segments of the loan and lease portfolio, management considers certain credit quality indicators. For the commercial mortgage, construction and commercial and industrial loan segments, periodic reviews of the individual loans are performed by both in-house staff as well as external loan reviewers. The result of these reviews is reflected in the risk grade assigned to each loan. These internally assigned grades are as follows:

• Pass – Loans considered satisfactory with no indications of deterioration.

Page 27

• Special mention - Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.

• Substandard - Loans classified as substandard are inadequately protected by the current net worth and payment capacity of the obligor or of the collateral pledged, if any. Substandard loans have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

• Doubtful - Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

In addition, for the remaining segments of the loan and lease portfolio, which include residential mortgage, home equity lines and loans, consumer, and leases, the credit quality indicator used to determine this component of the Allowance is based on performance status.

The following tables detail the carrying value of all portfolio loans and leases by portfolio segment based on the credit quality indicators used to determine the Allowance as of September 30, 2018 and December 31, 2017:

Credit Risk Profile by Internally Assigned Grade

	Commercial Mortgage				Construction				Commercial and Industrial				Total
(dollars in thousands)	September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017
Pass	$	1,592,174	$	1,490,862	$	168,897	$	193,227	$	697,913	$	711,145	$	2,458,984	$	2,395,234
Special Mention	2,321		13,448		934		3,902		2,425		889		5,680		18,239
Substandard	23,447		18,194		8,662		15,325		22,660		6,013		54,769		39,532
Doubtful	551		873		—		—		1		1,265		552		2,138
Total	$	1,618,493	$	1,523,377	$	178,493	$	212,454	$	722,999	$	719,312	$	2,519,985	$	2,455,143

Credit Risk Profile by Payment Activity

	Residential Mortgage				Home Equity Lines and Loans				Consumer				Leases				Total
(dollars inthousands)	September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017
Performing	$	464,632	$	454,469	$	205,873	$	216,794	$	47,692	$	38,153	$	137,111	$	115,298	$	855,308	$	824,714
Non-performing	2,770		4,417		1,933		1,481		117		—		1,362		103		6,182		6,001
Total	$	467,402	$	458,886	$	207,806	$	218,275	$	47,809	$	38,153	$	138,473	$	115,401	$	861,490	$	830,715

The following tables detail the carrying value of originated portfolio loans and leases by portfolio segment based on the credit quality indicators used to determine the Allowance as of September 30, 2018 and December 31, 2017:

Credit Risk Profile by Internally Assigned Grade

	Commercial Mortgage				Construction				Commercial and Industrial				Total
(dollars in thousands)	September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017
Pass	$	1,252,916	$	1,114,171	$	152,429	$	126,260	$	610,730	$	586,896	$	2,016,075	$	1,827,327
Special Mention	—		—		—		—		2,198		664		2,198		664
Substandard	6,481		8,156		6,262		2,006		5,271		1,389		18,014		11,551
Doubtful	—		—		—		—		1		355		1		355
Total	$	1,259,397	$	1,122,327	$	158,691	$	128,266	$	618,200	$	589,304	$	2,036,288	$	1,839,897

Page 28

Credit Risk Profile by Payment Activity

	Residential Mortgage				Home Equity Lines and Loans				Consumer				Leases				Total
(dollars in thousands)	September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017
Performing	$	379,069	$	359,430	$	178,376	$	182,062	$	44,791	$	35,146	$	109,455	$	67,932	$	711,691	$	644,570
Non-performing	1,968		1,505		1,692		1,221		42		—		479		103		4,181		2,829
Total	$	381,037	$	360,935	$	180,068	$	183,283	$	44,833	$	35,146	$	109,934	$	68,035	$	715,872	$	647,399

The following tables detail the carrying value of acquired portfolio loans and leases by portfolio segment based on the credit quality indicators used to determine the Allowance as of September 30, 2018 and December 31, 2017:

Credit Risk Profile by Internally Assigned Grade

	Commercial Mortgage				Construction				Commercial and Industrial				Total
(dollars in thousands)	September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017
Pass	$	339,258	$	376,691	$	16,468	$	66,967	$	87,183	$	124,249	$	442,909	$	567,907
Special Mention	2,321		13,448		934		3,902		227		225		3,482		17,575
Substandard	16,966		10,038		2,400		13,319		17,389		4,624		36,755		27,981
Doubtful	551		873		—		—		—		910		551		1,783
Total	$	359,096	$	401,050	$	19,802	$	84,188	$	104,799	$	130,008	$	483,697	$	615,246

 Credit Risk Profile by Payment Activity

	Residential Mortgage				Home Equity Lines and Loans				Consumer				Leases				Total
(dollars inthousands)	September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017
Performing	$	85,563	$	95,039	$	27,497	$	34,732	$	2,901	$	3,007	$	27,656	$	47,366	$	143,617	$	180,144
Non-performing	802		2,912		241		260		75		—		883		—		2,001		3,172
Total	$	86,365	$	97,951	$	27,738	$	34,992	$	2,976	$	3,007	$	28,539	$	47,366	$	145,618	$	183,316

G. Troubled Debt Restructurings (“TDRs”)

The restructuring of a loan is considered a “troubled debt restructuring” if both of the following conditions are met: (i) the borrower is experiencing financial difficulties, and (ii) the creditor has granted a concession. The most common concessions granted include one or more modifications to the terms of the debt, such as (a) a reduction in the interest rate for the remaining life of the debt, (b) an extension of the maturity date at an interest rate lower than the current market rate for new debt with similar risk, (c) a temporary period of interest-only payments, (d) a reduction in the contractual payment amount for either a short period or remaining term of the loan, and (e) for leases, a reduced lease payment. A less common concession granted is the forgiveness of a portion of the principal.

The determination of whether a borrower is experiencing financial difficulties takes into account not only the current financial condition of the borrower, but also the potential financial condition of the borrower, were a concession not granted. Similarly, the determination of whether a concession has been granted is very subjective in nature. For example, simply extending the term of a loan at its original interest rate or even at a higher interest rate could be interpreted as a concession unless the borrower could readily obtain similar credit terms from a different lender.

Page 29

The following table presents the balance of TDRs as of the indicated dates:

(dollars in thousands)	September 30, 2018		December 31, 2017
TDRs included in nonperforming loans and leases	$	1,208	$	3,289
TDRs in compliance with modified terms	4,316		5,800
Total TDRs	$	5,524	$	9,089

The following table presents information regarding loan and lease modifications categorized as TDRs for the three months ended September 30, 2018:

	For the Three Months Ended September 30, 2018
(dollars in thousands)	Number of Contracts	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
Home equity loans and lines	—	$	—	$	—
Residential mortgages	4	406		430
Leases	—	—		—
Total	4	$	406	$	430

The following table presents information regarding the types of loan and lease modifications made for the three months ended September 30, 2018:

	Number of Contracts
	Loan Term Extension	Interest Rate Change and Term Extension	Interest Rate Change and/or Interest-Only Period	Contractual Payment Reduction (Leases only)	Temporary Payment Deferral
Home equity loans and lines	—	—	—	—	—
Residential mortgages	1	—	—	—	3
Leases	—	—	—	—	—
Total	1	—	—	—	3

The following table presents information regarding loan and lease modifications categorized as TDRs for the nine months ended September 30, 2018: 

	For the Nine Months Ended September 30, 2018
(dollars in thousands)	Number of Contracts	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
Home equity loans and lines	1	$	8	$	8
Residential mortgages	6	625		649
Commercial and industrial	1	18		18
Leases	2	33		33
Total	10	$	684	$	708

Page 30

The following table presents information regarding the types of loan and lease modifications made for the nine months ended September 30, 2018:

	Number of Contracts
	Loan Term Extension	Interest Rate Change and Term Extension	Interest Rate Change and/or Interest-Only Period	Contractual Payment Reduction (Leases only)	Temporary Payment Deferral
Home equity loans and lines	—	1	—	—	—
Residential mortgages	2	1	—	—	3
Commercial and industrial	—	1	—	—	—
Leases	—	—	—	2	—
Total	2	3	—	2	3

During the nine months ended September 30, 2018, one home equity line of credit with a principal balance of $25 thousand and one lease with a principal balance of $50 thousand, which had been previously modified to troubled debt restructurings defaulted and were charged off.

H. Impaired Loans

The following tables detail the recorded investment and principal balance of impaired loans by portfolio segment, their related Allowance and interest income recognized for the three and nine months ended September 30, 2018 and 2017 (purchased credit-impaired loans are not included in the tables):

As of and for the Three Months Ended September 30, 2018	Recorded Investment**		Principal Balance		Related Allowance		Average Principal Balance		Interest Income Recognized		Cash-Basis Interest Income Recognized
(dollars in thousands)
Impaired loans with related allowance:
Home equity lines and loans	$	567	$	567	$	19	$	569	$	6	$	—
Residential mortgage	1,699		1,699		228		1,702		20		—
Commercial and industrial	25		25		12		25		—		—
Consumer	58		58		19		58		—		—
Total	$	2,349	$	2,349	$	278	$	2,354	$	26	$	—
Impaired loans without related allowance*:
Commercial mortgage	$	735	$	793	$	—	$	930	$	—	$	—
Home equity lines and loans	2,035		2,096		—		2,064		2		—
Residential mortgage	4,242		4,328		—		4,299		24		—
Construction	291		291		—		294		—		—
Commercial and industrial	1,733		2,665		—		2,138		5		—
Consumer	86		86		—		87		—		—
Total	$	9,122	$	10,259	$	—	$	9,812	$	31	$	—
Grand total	$	11,471	$	12,608	$	278	$	12,166	$	57	$	—

*The table above does not include the recorded investment of $1.4 million of impaired leases without a related Allowance.

**Recorded investment equals principal balance less partial charge-offs and interest payments on non-performing loans that have been applied to principal.

Page 31

As of and for the Nine Months Ended September 30, 2018	Recorded Investment**		Principal Balance		Related Allowance		Average Principal Balance		Interest Income Recognized		Cash-Basis Interest Income Recognized
(dollars in thousands)
Impaired loans with related allowance:
Home equity lines and loans	$	567	$	567	$	19	$	572	$	17	$	—
Residential mortgage	1,699		1,699		228		1,709		60		—
Commercial and industrial	25		25		12		29		1		—
Consumer	58		58		19		58		1		—
Total	$	2,349	$	2,349	$	278	$	2,368	$	79	$	—
Impaired loans without related allowance*:
Commercial mortgage	$	735	$	793	$	—	$	825	$	6	$	—
Home equity lines and loans	2,035		2,096		—		2,086		10		—
Residential mortgage	4,242		4,328		—		4,228		91		—
Construction	291		291				239		5		—
Commercial and industrial	1,733		2,665		—		2,236		56		—
Consumer	86		86				88		3		—
Total	$	9,122	$	10,259	$	—	$	9,702	$	171	$	—
Grand total	$	11,471	$	12,608	$	278	$	12,070	$	250	$	—

*The table above does not include the recorded investment of $1.4 million of impaired leases without a related Allowance.

**Recorded investment equals principal balance less partial charge-offs and interest payments on non-performing loans that have been applied to principal.

As of and for the Three Months Ended September 30, 2017	Recorded Investment**		Principal Balance		Related Allowance		Average Principal Balance		Interest Income Recognized		Cash-Basis Interest Income Recognized
(dollars in thousands)
Impaired loans with related allowance:
Home equity lines and loans	$	21	$	21	$	3	$	21	$	—	$	—
Residential mortgage	1,770		1,770		116		1,776		23		—
Consumer	27		27		4		28		—		—
Total	$	1,818	$	1,818	$	123	$	1,825	$	23	$	—
Impaired loans without related allowance*:
Commercial mortgage	$	1,449	$	1,485	$	—	$	1,451	$	15	$	—
Home equity lines and loans	633		694		—		655		1		—
Residential mortgage	4,688		5,015		—		4,243		43		—
Commercial and industrial	1,940		2,796		—		2,605		2		—
Total	$	8,710	$	9,990	$	—	$	8,954	$	61	$	—
Grand total	$	10,528	$	11,808	$	123	$	10,779	$	84	$	—

*The table above does not include the recorded investment of $270 thousand of impaired leases without a related Allowance.

**Recorded investment equals principal balance less partial charge-offs and interest payments on non-performing loans that have been applied to principal.

Page 32

As of and for the Nine Months Ended September 30, 2017	Recorded Investment**		Principal Balance		Related Allowance		Average Principal Balance		Interest Income Recognized		Cash-Basis Interest Income Recognized
(dollars in thousands)
Impaired loans with related allowance:
Home equity lines and loans	$	21	$	21	$	3	$	21	$	1	$	—
Residential mortgage	1,770		1,770		116		1,797		67		—
Consumer	27		27		4		28		1		—
Total	$	1,818	$	1,818	$	123	$	1,846	$	69	$	—
Impaired loans without related allowance*:
Commercial mortgage	$	1,449	$	1,485	$	—	$	1,475	$	45	$	—
Home equity lines and loans	633		694		—		669		5		—
Residential mortgage	4,688		5,015		—		4,288		118		—
Commercial and industrial	1,940		2,796		—		2,746		34		—
Total	$	8,710	$	9,990	$	—	$	9,178	$	202	$	—
Grand total	$	10,528	$	11,808	$	123	$	11,024	$	271	$	—

*The table above does not include the recorded investment of $270 thousand of impaired leases without a related Allowance.

**Recorded investment equals principal balance less partial charge-offs and interest payments on non-performing loans that have been applied to principal.

(dollars in thousands)	Recorded Investment (2)		Principal Balance		Related Allowance
As of December 31, 2017
Impaired loans with related allowance:
Home equity lines and loans	$	577	$	577	$	19
Residential mortgage	2,436		2,435		230
Commercial and industrial	18		19		5
Consumer	27		27		4
Total	$	3,058	$	3,058	$	258
Impaired loans without related allowance(1):
Home equity lines and loans	$	1,585	$	1,645	$	—
Residential mortgage	5,290		5,529		—
Commercial and industrial	1,879		3,613		—
Commercial mortgage	2,128		2,218		—
Total	$	10,882	$	13,005	$	—
Grand total	$	13,940	$	16,063	$	258

⁽¹⁾  The table above does not include the recorded investment of$272 thousandof impaired leases without a related Allowance.

⁽²⁾  Recorded investment equals principal balance less partial charge-offs and interest payments on non-performing loans that have been applied to principal.

I. Loan Mark

Loans acquired in mergers and acquisitions are recorded at fair value as of the date of the transaction. This adjustment to the acquired principal amount is referred to as the “Loan Mark.” With the exception of purchased credit impaired loans, for which the Loan Mark is accounted under ASC 310-30, the Loan Mark is amortized or accreted as an adjustment to yield over the lives of the loans.

Page 33

The following tables detail, for acquired loans, the outstanding principal, remaining Loan Mark, and recorded investment, by portfolio segment, as of the dates indicated:

	As of September 30, 2018
(dollars in thousands)	Outstanding Principal		Remaining Loan Mark			Recorded Investment
Commercial mortgage	$	369,894	$	(10,798	)	$	359,096
Home equity lines and loans	30,240		(2,502		)	27,738
Residential mortgage	89,302		(2,937		)	86,365
Construction	20,142		(340		)	19,802
Commercial and industrial	111,799		(7,000		)	104,799
Consumer	3,094		(118		)	2,976
Leases	29,793		(1,254		)	28,539
Total	$	654,264	$	(24,949	)	$	629,315

	As of December 31, 2017
(dollars in thousands)	Outstanding Principal		Remaining Loan Mark			Recorded Investment
Commercial mortgage	$	412,263	$	(11,213	)	$	401,050
Home equity lines and loans	37,944		(2,952		)	34,992
Residential mortgage	101,523		(3,572		)	97,951
Construction	86,081		(1,893		)	84,188
Commercial and industrial	141,960		(11,952		)	130,008
Consumer	3,051		(44		)	3,007
Leases	50,530		(3,164		)	47,366
Total	$	833,352	$	(34,790	)	$	798,562

Note6- Mortgage Servicing Rights

The following table summarizes the Corporation’s activity related to mortgage servicing rights (“MSRs”) for the three and nine months ended September 30, 2018 and 2017:

	Three Months Ended September 30,
(dollars in thousands)	2018			2017
Balance, beginning of period	$	5,511		$	5,682
Additions	—			282
Amortization	(206		)	(229		)
Recovery / (Impairment)	23			(3		)
Balance, end of period	$	5,328		$	5,732
Fair value	$	6,586		$	6,146

	Nine Months Ended September 30,
(dollars in thousands)	2018			2017
Balance, beginning of period	$	5,861		$	5,582
Additions	16			770
Amortization	(623		)	(571		)
Recovery / (Impairment)	74			(49		)
Balance, end of period	$	5,328		$	5,732
Fair value	$	6,586		$	6,146
Residential mortgage loans serviced for others	$	596,162		$	647,997

Page 34

As of September 30, 2018, and December 31, 2017, key economic assumptions and the sensitivity of the current fair value of MSRs to immediate 10% and 20% adverse changes in those assumptions are as follows:

(dollars in thousands)	September 30, 2018			December 31, 2017
Fair value amount of MSRs	$	6,586		$	6,397
Weighted average life (in years)	6.6			6.1
Prepayment speeds (constant prepayment rate)*	8.7		%	10.3		%
Impact on fair value:
10% adverse change	$	(85	)	$	(194	)
20% adverse change	$	(190	)	$	(394	)
Discount rate	9.55		%	9.55		%
Impact on fair value:
10% adverse change	$	(245	)	$	(225	)
20% adverse change	$	(472	)	$	(434	)

*Represents the weighted average prepayment rate for the life of the MSR asset.

At September 30, 2018 and December 31, 2017 the fair value of the MSRs was $6.6 million and $6.4 million, respectively. The fair value of the MSRs for these dates was determined using values obtained from a third party which utilizes a valuation model which calculates the present value of estimated future servicing income. The model incorporates assumptions that market participants use in estimating future net servicing income, including estimates of prepayment speeds and discount rates. Mortgage loan prepayment speed is the annual rate at which borrowers are forecasted to repay their mortgage loan principal and is based on historical experience. The discount rate is used to determine the present value of future net servicing income. Another key assumption in the model is the required rate of return the market would expect for an asset with similar risk. These assumptions can, and generally will, change quarterly valuations as market conditions and interest rates change. Management reviews, annually, the process utilized by its independent third-party valuation experts.

These assumptions and sensitivities are hypothetical and should be used with caution. As the figures indicate, changes in fair value based on a 10% variation in assumptions generally cannot be extrapolated because the relationship of the change in assumptions to the change in fair value may not be linear. Also, the effect of a variation in a particular assumption on the fair value of the MSRs is calculated without changing any other assumption. In reality, changes in one factor may result in changes in another, which could magnify or counteract the sensitivities.

Note7- Goodwill and Intangible Assets

The following table presents activity in the Corporation's goodwill by its reporting units and finite-lived and indefinite-lived intangible assets, other than MSRs, for the nine months ended September 30, 2018:

(dollars in thousands)	Balance December 31, 2017		Additions		Adjustments		Amortization			Balance September 30, 2018		Amortization Period
Goodwill – Wealth	$	20,412	$	—	$	—	$	—		$	20,412	Indefinite
Goodwill – Banking	153,545		—		3,298		—			156,843		Indefinite
Goodwill – Insurance	5,932		677		—		—			6,609		Indefinite
Total Goodwill	$	179,889	$	677	$	3,298	$	—		$	183,864
Core deposit intangible	$	7,380	$	—	$	—	$	(1,108	)	$	6,272	10 years
Customer relationships	14,173		994		—		(1,271		)	13,896		10 to 20 years
Non-compete agreements	1,319		—		—		(171		)	1,148		5 to 10 years
Trade name	2,322		—		—		(49		)	2,273		3 years to Indefinite
Domain name	151		—		—		—			151		Indefinite
Favorable lease assets	621		—		—		(60		)	561		1 to 16 years
Total Intangible Assets	$	25,966	$	994	$	—	$	(2,659	)	$	24,301
Total Goodwill and Intangible Assets	$	205,855	$	1,671	$	3,298	$	(2,659	)	$	208,165

Page 35

Management conducted its annual impairment tests for goodwill and indefinite-lived intangible assets as of October 31, 2017 using generally accepted valuation methods. Management determined that no impairment of goodwill or indefinite-lived intangible assets was identified as a result of the annual impairment analyses. Future impairment testing will be conducted each October 31, unless a triggering event occurs in the interim that would suggest possible impairment, in which case it would be tested as of the date of the triggering event. For the eleven months ended September 30, 2018, management determined there were no events that would necessitate impairment testing of goodwill or indefinite-lived intangible assets.

Note8-Deposits

The following table details the components of deposits:

	September 30, 2018		December 31, 2017
(dollars in thousands)
Interest-bearing demand	$	578,243	$	481,336
Money market	812,027		862,639
Savings	286,266		338,572
Retail time deposits	561,123		532,202
Wholesale non-maturity deposits	24,040		62,276
Wholesale time deposits	261,164		171,929
Total interest-bearing deposits	$	2,522,863	$	2,448,954
Noninterest-bearing deposits	834,363		924,844
Total deposits	$	3,357,226	$	3,373,798

Page 36

Note9-Short-Term Borrowings and Long-Term FHLB Advances

A. Short-term borrowings

The Corporation’s short-term borrowings (original maturity of one year or less), which consist of funds obtained from overnight repurchase agreements with commercial customers, FHLB advances with original maturities of one year or less and overnight fed funds, are detailed below.

A summary of short-term borrowings is as follows:

(dollars in thousands)	September 30, 2018		December 31, 2017
Repurchase agreements* – commercial customers	$	21,548	$	25,865
Short-term FHLB advances	204,950		212,000
Total short-term borrowings	$	226,498	$	237,865

* Overnight repurchase agreements with no expiration date

The following table sets forth information concerning short-term borrowings:

	Three Months Ended September 30,						Nine Months Ended September 30,
(dollars in thousands)	2018			2017			2018			2017
Balance at period-end	$	226,498		$	180,874		$	226,498		$	180,874
Maximum amount outstanding at any month end	$	302,932		$	184,578		$	302,932		$	184,578
Average balance outstanding during the period	$	218,551		$	182,845		$	205,046		$	110,268
Weighted-average interest rate:
As of the period-end	2.18		%	1.17		%	2.18		%	1.17		%
Paid during the period	2.09		%	1.19		%	1.85		%	0.98		%

Average balances outstanding during the year represent daily average balances and average interest rates represent interest expense divided by the related average balance.

B.Long-termFHLB Advances

As of September 30, 2018 and December 31, 2017, the Corporation had $72.8 million and $139.1 million, respectively, of long-term FHLB advances (original maturities exceeding one year).

The following table presents the remaining periods until maturity of long-term FHLB advances:

(dollars in thousands)	September 30, 2018		December 31, 2017
Within one year	$	28,106	$	83,766
Over one year through five years	44,735		55,374
Total	$	72,841	$	139,140

Page 37

The following table presents rate and maturity information on FHLB advances and other borrowings: 

	Maturity Range(1)		Weighted Average Rate(1)		Coupon Rate(1)				Balance at
Description	From	To			From		To		September 30, 2018		December 31, 2017
Bullet maturity – fixed rate	10/1/2018	1/2/2020	1.32	%	1.31	%	2.45	%	$	72,841	$	118,131
Convertible-fixed(2)	N/A	N/A	N/A		N/A		N/A		—		21,009
Total									$	72,841	$	139,140

(1)Maturity range, weighted average rate and coupon rate range refers to September 30, 2018balances.

(2)FHLB advances whereby the FHLB has the option, at predetermined times, to convert the fixed interest rate to an adjustable interest rate indexed to the London Interbank Offered Rate (“LIBOR”). The Corporation has the option to prepay these advances, without penalty, if the FHLB elects to convert the interest rate to an adjustable rate. As of September 30, 2018, the Corporation held no FHLB advances with this convertible feature.

C. Other Borrowings Information

In connection with its FHLB borrowings, the Corporation is required to hold the capital stock of the FHLB. The amount of capital stock held was $14.7 million at September 30, 2018, and $20.1 million at December 31, 2017. The carrying amount of the FHLB stock approximates its redemption value.

The level of required investment in FHLB stock is based on the balance of outstanding borrowings the Corporation has from the FHLB.  Although FHLB stock is a financial instrument that represents an equity interest in the FHLB, it does not have a readily determinable fair value. FHLB stock is generally viewed as a long-term investment. Accordingly, when evaluating FHLB stock for impairment, its value should be determined based on the ultimate recoverability of the par value rather than by recognizing temporary declines in value.

The Corporation had a maximum borrowing capacity with the FHLB of $1.50 billion as of September 30, 2018 of which the unused capacity was $1.20 billion. In addition, there were $79.0 million in the overnight federal funds line available and $139.6 million of Federal Reserve Discount Window capacity.

Note10– Subordinated Notes

On December 13, 2017, the Corporation completed the issuance of $70.0 million in aggregate principal amount of fixed-to-floating rate subordinated notes due 2027 (the "2027 Notes") in an underwritten public offering. On August 6, 2015, the Corporation completed the issuance of $30.0 million in aggregate principal amount of fixed-to-floating rate subordinated notes due 2025 (the "2025 Notes") in a private placement transaction to institutional accredited investors. The net proceeds of both offerings increased Tier II regulatory capital at the Corporation level.

The following tables detail the subordinated notes, including debt issuance costs, as of September 30, 2018, and December 31, 2017:

	September 30, 2018				December 31, 2017
(dollars in thousands)	Balance		Rate(1)(2)		Balance		Rate(1)(2)
Subordinated notes – due 2027	$	68,855	4.25	%	$	68,829	4.25	%
Subordinated notes – due 2025	29,627		4.75	%	29,587		4.75	%
Total subordinated notes	$	98,482			$	98,416

(1)The 2027 Notes bear interest at an annual fixed rate of 4.25% from the date of issuance until December 14, 2022, and will thereafter bear interest at a variable rate that will reset quarterly to a level equal to the then-current three-month LIBOR rate plus 2.050% until December 15, 2027, or any early redemption date.

(2)The 2025 Notes bear interest at an annual fixed rate of 4.75% from the date of issuance until August 14, 2020, and will thereafter bear interest at a variable rate that will reset quarterly to a level equal to the then-current three-month LIBOR rate plus 3.068% until August 15, 2025, or any early redemption date.

Page 38

Note 11 – Junior Subordinated Debentures

In connection with the RBPI Merger, the Corporation acquired Royal Bancshares Capital Trust I (“Trust I”) and Royal Bancshares Capital Trust II (“Trust II”) (collectively, the “Trusts”), which were utilized for the sole purpose of issuing and selling capital securities representing preferred beneficial interests. Although the Corporation owns $774 thousand of the common securities of Trust I and Trust II, the Trusts are not consolidated into the Corporation’s Consolidated Financial Statements as the Corporation is not deemed to be the primary beneficiary of these entities. In connection with the issuance and sale of the capital securities, RBPI issued, and the Corporation assumed as a result of the RBPI Merger, junior subordinated debentures to the Trusts of $10.7 million each, totaling $21.4 million representing the Corporation’s maximum exposure to loss. The junior subordinated debentures incur interest at a coupon rate of 4.48% as of September 30, 2018. The rate resets quarterly based on 3-month LIBOR plus 2.15%.

Each of Trust I and Trust II issued an aggregate principal amount of $12.5 million of capital securities initially bearing fixed and/or fixed/floating interest rates corresponding to the debt securities held by each trust to an unaffiliated investment vehicle and an aggregate principal amount of $387 thousand of common securities bearing fixed and/or fixed/floating interest rates corresponding to the debt securities held by each trust to the Corporation. As a result of the RBPI Merger, the Corporation has fully and unconditionally guaranteed all of the obligations of the Trusts, including any distributions and payments on liquidation or redemption of the capital securities.

The rights of holders of common securities of the Trusts are subordinate to the rights of the holders of capital securities only in the event of a default; otherwise, the common securities’ economic and voting rights are pari passu with the capital securities. The capital and common securities of the Trusts are subject to mandatory redemption upon the maturity or call of the junior subordinated debentures held by each. Unless earlier dissolved, the Trusts will dissolve on December 15, 2034. The junior subordinated debentures are the sole assets of Trusts, mature on December 15, 2034, and may be called at par by the Corporation any time after December 15, 2009. The Corporation records its investments in the Trusts’ common securities of $387 thousand each as investments in unconsolidated entities and records dividend income upon declaration by Trust I and Trust II.

Note 12– Derivative Instruments and Hedging Activities

Derivative financial instruments involve, to varying degrees, interest rate, market and credit risk. Management manages these risks as part of its asset and liability management process and through credit policies and procedures. Management seeks to minimize counterparty credit risk by establishing credit limits and collateral agreements and utilizes certain derivative financial instruments to enhance its ability to manage interest rate risk that exists as part of its ongoing business operations. The derivative transactions entered into by the Corporation are an economic hedge of a derivative offerings to Bank customers. The Corporation does not use derivative financial instruments for trading purposes.

Customer Derivatives – Interest Rate Swaps. The Corporation enters into interest rate swaps that allow commercial loan customers to effectively convert a variable-rate commercial loan agreement to a fixed-rate commercial loan agreement. Under these agreements, the Corporation originates variable-rate loans with customers in addition to interest rate swap agreements, which serve to effectively swap the customers’ variable-rate loans into fixed-rate loans. The Corporation then enters into corresponding swap agreements with swap dealer counterparties to economically hedge its exposure on the variable and fixed components of the customer agreements. The interest rate swaps with both the customers and third parties are not designated as hedges under FASB ASC 815 and are marked to market through earnings. As the interest rate swaps are structured to offset each other, changes to the underlying benchmark interest rates considered in the valuation of these instruments do not result in an impact to earnings; however, there may be fair value adjustments related to credit quality variations between counterparties, which may impact earnings as required by FASB ASC 820. As of September 30, 2018, there were no fair value adjustments related to credit quality.

Risk Participation Agreements. The Corporation may enter into a risk participation agreement (“RPA”) with another institution as a means to assume a portion of the credit risk associated with a loan structure which includes a derivative instrument, in exchange for fee income commensurate with the risk assumed. This type of derivative is referred to as an “RPA sold.” In addition, in an effort to reduce the credit risk associated with an interest rate swap agreement with a borrower for whom the Corporation has provided a loan structured with a derivative, the Corporation may purchase an RPA from an institution participating in the facility in exchange for a fee commensurate with the risk shared. This type of derivative is referred to as an “RPA purchased.”

Page 39

The following tables detail the derivative instruments as of September 30, 2018 and December 31, 2017:

	Asset Derivatives				Liability Derivatives
(dollars in thousands)	Notional Amount		Fair Value		Notional Amount		Fair Value
Derivatives not designated as hedging instruments
As of September 30, 2018:
Customer derivatives – interest rate swaps	$	295,566	$	5,843	$	295,566	$	5,843
RPAs sold	—		—		865		1
RPAs purchased	35,464		43		—		—
Total derivatives	$	331,030	$	5,886	$	296,431	$	5,844
As of December 31, 2017:
Customer derivatives – interest rate swaps	$	124,627	$	1,895	$	124,627	$	1,895
RPAs sold	—		—		899		3
RPAs purchased	14,710		21		—		—
Total derivatives	$	139,337	$	1,916	$	125,526	$	1,898

The Corporation has International Swaps and Derivatives Association agreements with third parties that requires a minimum dollar transfer amount upon a margin call. This requirement is dependent on certain specified credit measures. The amount of collateral posted with third parties at September 30, 2018 and December 31, 2017 was $420 thousand and $1.3 million, respectively. The amount of collateral posted with third parties is deemed to be sufficient to collateralize both the fair market value change as well as any additional amounts that may be required as a result of a change in the specified credit measures. The aggregate fair value of all derivative financial instruments in a liability position with credit measure contingencies and entered into with third parties was $1.8 million and $1.6 million as of September 30, 2018 and December 31, 2017, respectively.

Note 13 - Accounting for Uncertainty in Income Taxes

The Corporation recognizes the financial statement benefit of a tax position only after determining that the Corporation would be more likely than not to sustain the position following an examination. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50% likelihood of being realized upon settlement with the relevant tax authority.

The Corporation is subject to income taxes in the United States federal jurisdiction and multiple state jurisdictions. The Corporation is no longer subject to U.S. federal income tax examination by taxing authorities for years before 2014.

The Corporation’s policy is to record interest and penalties on uncertain tax positions as income tax expense. No interest or penalties were accrued for the three or nine months ended September 30, 2018 or 2017.

Note 14- Shareholders’ Equity

Dividend

On October 17, 2018, the Corporation’s Board of Directors declared a regular quarterly dividend of $0.25 per share payable December 1, 2018 to shareholders of record as of November 1, 2018. During the third quarter of 2018, the Corporation paid or accrued, as applicable, a regular quarterly dividend of $0.25 per share. This dividend totaled $5.1 million, based on outstanding shares and restricted stock units as of August 1, 2018 of 20,443,918 shares.

S-3 Shelf Registration Statement and Offerings Thereunder

In May 2018, the Corporation filed a shelf registration statement on Form S-3, SEC File No. 333-224849 (the “Shelf Registration Statement”). The Shelf Registration Statement allows the Corporation to raise additional capital from time to time through offers and sales of registered securities consisting of common stock, debt securities, warrants, purchase contracts, rights and units or units consisting of any combination of the foregoing securities. The Corporation may sell these securities using the prospectus in the Shelf Registration Statement, together with applicable prospectus supplements, from time to time, in one or more offerings.

Page 40

In addition, the Corporation has in place a Dividend Reinvestment and Stock Purchase Plan (the “Plan”), which allows it to issue up to 1,500,000 shares of registered common stock. The Plan allows for the grant of a request for waiver (“RFW”) above the Plan’s maximum investment of $120 thousand per account per year. A RFW is granted based on a variety of factors, including the Corporation’s current and projected capital needs, prevailing market prices of the Corporation’s common stock and general economic and market conditions.

For the three and nine months ended September 30, 2018, the Corporation did not issue any shares under the Plan. No RFWs were approved during the three and nine months ended September 30, 2018. No other sales of equity securities were executed under the Shelf Registration Statement during the three and nine months ended September 30, 2018.

Option Exercises and Vesting of Restricted Stock Units ("RSUs") and Performance Stock Units ("PSUs")

In addition to shares that may be issued through the Plan, the Corporation also issues shares through the exercise of stock options and the vesting of RSUs and PSUs. During the three and nine months ended September 30, 2018, 15,150 shares and 63,825 shares, respectively, were issued pursuant to the exercise of stock options, increasing shareholders’ equity by $349 thousand and $1.5 million, respectively. The increase in shareholders’ equity related to the vesting of RSUs and PSUs, which is recognized over the vesting period through stock based compensation expense, was $708 thousand and $1.9 million for the three and nine months ended September 30, 2018, respectively.

Stock Repurchases

On August 6, 2015, the Corporation announced a stock repurchase program (the “2015 Program”) under which the Corporation may repurchase up to 1,200,000 shares of the Corporation’s common stock, at an aggregate purchase price not to exceed $40 million. During the three months ended September 30, 2018, 14,263 shares were repurchased under the 2015 Program. As of September 30, 2018, the maximum number of shares remaining authorized for repurchase under the 2015 Program was 175,037. In addition to the 2015 Program, it is the Corporation’s practice to retire shares to its treasury account upon the vesting of stock awards to certain officers in order to cover the statutory income tax withholdings related to such vestings.

Page 41

Note 15 – Accumulated Other Comprehensive (Loss) Income

The following table details the components of accumulated other comprehensive (loss) income for the three and nine month periods ended September 30, 2018 and 2017:

(dollars in thousands)	Net Change in Unrealized Gains on Available-for- Sale Investment Securities			Net Change in Unfunded Pension Liability			Accumulated Other Comprehensive Loss
Balance, June 30, 2018	$	(9,669	)	$	(1,522	)	$	(11,191	)
Other comprehensive (loss) income	(2,319		)	108			(2,211		)
Balance, September 30, 2018	$	(11,988	)	$	(1,414	)	$	(13,402	)
Balance, June 30, 2017	$	(433	)	$	(1,131	)	$	(1,564	)
Other comprehensive income	149			15			164
Balance, September 30, 2017	$	(284	)	$	(1,116	)	$	(1,400	)

(dollars in thousands)	Net Change in Unrealized Gains on Available-for- Sale Investment Securities			Net Change in Unfunded Pension Liability			Accumulated Other Comprehensive Loss
Balance, December 31, 2017	$	(2,861	)	$	(1,553	)	$	(4,414	)
Other comprehensive (loss) income	(9,127		)	139			(8,988		)
Balance, September 30, 2018	$	(11,988	)	$	(1,414	)	$	(13,402	)
Balance, December 31, 2016	$	(1,231	)	$	(1,178	)	$	(2,409	)
Other comprehensive income	947			62			1,009
Balance, September 30, 2017	$	(284	)	$	(1,116	)	$	(1,400	)

The following table details the amounts reclassified from each component of accumulated other comprehensive loss to each component’s applicable income statement line, for the three and nine month periods ended September 30, 2018 and 2017:

	Amount Reclassified from Accumulated Other Comprehensive Loss
Description of Accumulated Other Comprehensive Loss Component	Three Months Ended September 30,				Affected Income Statement Category
	2018		2017
Net unrealized gain on investment securities available for sale:
Realization of gain on sale of investment securities available for sale	$	—	$	72	Net gain on sale of available for sale investment securities
Realization of gain on transfer of investment securities available for sale to trading	—		—		Other operating income
Total	$	—	$	72
Income tax effect	—		25		Income tax expense
Net of income tax	$	—	$	47	Net income
Unfunded pension liability:
Amortization of net loss included in net periodic pension costs*	$	25	$	24	Other operating expenses
Income tax effect	5		8		Income tax expense
Net of income tax	$	20	$	16	Net income

Page 42

	Amount Reclassified from Accumulated Other Comprehensive Loss
Description of Accumulated Other Comprehensive Loss Component	Nine Months Ended September 30,				Affected Income Statement Category
	2018		2017
Net unrealized gain on investment securities available for sale:
Realization of gain on sale of investment securities available for sale	$	7	$	73	Net gain on sale of available for sale investment securities
Realization of gain on transfer of investment securities available for sale to trading	417		—		Other operating income
Total	$	424	$	73
Income tax effect	89		27		Income tax expense
Net of income tax	$	335	$	46	Net income
Unfunded pension liability:
Amortization of net loss included in net periodic pension costs*	$	75	$	71	Other operating expenses
Income tax effect	15		25		Income tax expense
Net of income tax	$	60	$	46	Net income

*Accumulated other comprehensive loss components are included in the computation of net periodic pension cost.

Note 16 - Earnings per Common Share

Basic earnings per common share excludes dilution and is computed by dividing income available to common shareholders by the weighted-average common shares outstanding during the period. Diluted earnings per common share takes into account the potential dilution that would occur if in-the-money stock options were exercised and converted into common shares and RSUs and PSUs were vested. Proceeds assumed to have been received on option exercises are assumed to be used to purchase shares of the Corporation’s common stock at the average market price during the period, as required by the treasury stock method of accounting. The effects of stock options are excluded from the computation of diluted earnings per share in periods in which the effect would be antidilutive.

	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands except share and per share data)	2018		2017		2018		2017
Numerator:
Net income available to common shareholders	$	16,682	$	10,739	$	46,656	$	29,216
Denominator for basic earnings per share – weighted average shares outstanding	20,270,706		17,023,046		20,237,757		16,987,499
Effect of dilutive common shares	167,670		230,936		206,318		254,728
Denominator for diluted earnings per share – adjusted weighted average shares outstanding	20,438,376		17,253,982		20,444,075		17,242,227
Basic earnings per share	$	0.82	$	0.63	$	2.31	$	1.72
Diluted earnings per share	$	0.82	$	0.62	$	2.28	$	1.69
Antidilutive shares excluded from computation of average dilutive earnings per share	22,232		21,621		48,807		47,268

Page 43

Note 17 -Revenue from Contracts with Customers

All of the Corporation’s revenue from contracts with customers in the scope of ASC 606 is recognized within noninterest income.  The following table presents the Corporation’s noninterest income by revenue stream and reportable segment for the three and nine months ended September 30, 2018 and 2017.  Items outside the scope of ASC 606 are noted as such.

	Three Months Ended September 30, 2018						Three Months Ended September 30, 2017
(dollars in thousands)	Banking		Wealth Management		Consolidated		Banking		Wealth Management		Consolidated
Fees for wealth management services	$	—	$	10,343	$	10,343	$	—	$	9,651	$	9,651
Insurance commissions	—		1,754		1,754		—		1,373		1,373
Capital markets revenue(1)	710		—		710		843		—		843
Service charges on deposit accounts	726		—		726		676		—		676
Loan servicing and other fees(1)	559		—		559		548		—		548
Net gain on sale of loans(1)	631		—		631		799		—		799
Net gain on sale of investment securities available for sale(1)	—		—		—		72		—		72
Net gain on sale of other real estate owned	5		—		5		—		—		—
Dividends on FHLB and FRB stock(1)	375		—		375		217		—		217
Other operating income(2)	3,123		48		3,171		1,364		41		1,405
Total noninterest income	$	6,129	$	12,145	$	18,274	$	4,519	$	11,065	$	15,584

(1) Not within the scope of ASC 606.

(2) Other operating income includes Visa debit card income, safe deposit box rentals, and rent income totaling $595 thousand and $520 thousand for the three months ended September 30, 2018 and 2017, respectively, which are within the scope of ASC 606.

	Nine Months Ended September 30, 2018						Nine Months Ended September 30, 2017
(dollars in thousands)	Banking		Wealth Management		Consolidated		Banking			Wealth Management		Consolidated
Fees for wealth management services	$	—	$	31,309	$	31,309	$	—		$	28,761	$	28,761
Insurance commissions	—		5,349		5,349		—			3,079		3,079
Capital markets revenue(1)	3,481		—		3,481		1,796			—		1,796
Service charges on deposit accounts	2,191		—		2,191		1,953			—		1,953
Loan servicing and other fees(1)	1,720		—		1,720		1,570			—		1,570
Net gain on sale of loans(1)	1,677		—		1,677		1,948			—		1,948
Net gain on sale of investment securities available for sale(1)	7		—		7		73			—		73
Net gain (loss) on sale of other real estate owned	292		—		292		(12		)	—		(12		)
Dividends on FHLB and FRB stock(1)	1,316		—		1,316		649			—		649
Other operating income(2)	10,393		150		10,543		3,641			138		3,779
Total noninterest income	$	21,077	$	36,808	$	57,885	$	11,618		$	31,978	$	43,596

(1) Not within the scope of ASC 606.

(2) Other operating income includes Visa debit card income, safe deposit box rentals, and rent income totaling $1.7 million and $1.5 million for the nine months ended September 30, 2018 and 2017, respectively, which are within the scope of ASC 606.

Page 44

A description of the Corporation’s revenue streams accounted for under ASC 606 follows:

Service Charges on Deposit Accounts: The Corporation earns fees from its deposit customers for transaction-based, account maintenance, and overdraft services. Transaction-based fees, which include services such as ATM use fees, stop payment charges, statement rendering, and ACH fees, are recognized at the time the transaction is executed as that is the point in time the Corporation fulfills the customer’s request. Account maintenance fees, which relate primarily to monthly maintenance, are earned over the course of a month, representing the period over which the Corporation satisfies the performance obligation. Overdraft fees are recognized at the point in time that the overdraft occurs. Service charges on deposits are withdrawn from the customer’s account balance.

Wealth Management Fees: The Corporation earns wealth management fee revenue from a variety of sources including fees from trust administration and other related fiduciary services, custody, investment management and advisory services, employee benefit account and IRA administration, estate settlement, tax service fees, shareholder service fees and brokerage.

Fees that are determined based on the market value of the assets held in their accounts are generally billed monthly, in arrears, based on the market value of assets at the end of the previous billing period. Other related services that are based on a fixed fee schedule are recognized when the services are rendered. Fees that are transaction based, including trade execution services, are recognized at the point in time that the transaction is executed, i.e. the trade date.

Included in other assets on the balance sheet is a receivable for wealth management fees that have been earned but not yet collected.

Insurance Commissions: The Corporation earns commissions from the sale of insurance policies, which are generally calculated as a percentage of the policy premium, and contingent income, which is calculated based on the volume and performance of the policies held by each carrier. Obligations for the sale of insurance policies are generally satisfied at the point in time which the policy is executed and are recognized at the point in time in which the amounts are knownand collection is reasonably assured. Performance metrics for contingent income are generally satisfied over time, not exceeding one year, and are recognized at the point in time in which the amounts are known and collection is reasonably assured.

Visa Debit Card Income: The Corporation earns income fees from debit cardholder transactions conducted through the Visa payment network. Fees from cardholder transactions represent a percentage of the underlying transaction value and are recognized daily, concurrently with the transaction processing services provided to the cardholder.

Gains/Losses on Sales of OREO: The Corporation records a gain or loss from the sale of OREO when control of the property transfers to the buyer, which generally occurs at the time of an executed deed.

Note18–Stock-Based Compensation

A. General Information

The Corporation permits the issuance of stock options, dividend equivalents, performance stock awards, stock appreciation rights and restricted stock units or awards to employees and directors of the Corporation under several plans. The performance awards and restricted awards may be in the form of stock awards or stock units. Stock awards and stock units differ in that for a stock award, shares of restricted stock are issued in the name of the grantee, whereas a stock unit constitutes a promise to issue shares of stock upon vesting. The accounting for awards and units is identical. The terms and conditions of awards under the plans are determined by the Corporation’s Management Development and Compensation Committee.

Prior to April 25, 2007, all shares authorized for grant as stock-based compensation were limited to grants of stock options. On April 25, 2007, the shareholders approved the Corporation’s “2007 Long-Term Incentive Plan” (the “2007 LTIP”) under which a total of 428,996 shares of the Corporation’s common stock were made available for award grants. On April 28, 2010, the shareholders approved the Corporation’s “2010 Long Term Incentive Plan” under which a total of 445,002 shares of the Corporation’s common stock were made available for award grants and on April 30, 2015, the shareholders approved an amendment and restatement of such plan (as amended and restated, the “2010 LTIP”) to, among other things, increase the number of shares available for award grants by 500,000 to 945,002.

In addition to the shareholder-approved plans mentioned in the preceding paragraph, the Corporation periodically authorizes grants of stock-based compensation as inducement awards to new employees. This type of award does not require shareholder approval in accordance with Rule 5635(c)(4) of the NASDAQ listing rules.

Page 45

The equity awards are authorized to be in the form of, among others, options to purchase the Corporation’s common stock, RSUs and PSUs.

RSUs have a restriction based on the passage of time. The grant date fair value of the RSUs is based on the closing price on the date of the grant.

PSUs have restrictions based on performance criteria and the passage of time. The performance criteria may be a market-based criteria measured by the Corporation’s total shareholder return (“TSR”) relative to the performance of the community bank index for the respective period. The fair value of the PSUs based on the Corporation’s TSR relative to the performance of a designated peer group or the NASDAQ Community Bank Index is calculated using the Monte Carlo Simulation method. The performance criteria may also be based on a non-market-based criteria such as return on average equity relative to that designated peer group. The grant date fair value of these PSUs is based on the closing price of the Corporation’s stock on the date of the grant. PSU grants may have a vesting percent ranging from 0% to 150%.

B. Other Stock Option Information

The following table provides information about options outstanding for the three months ended September 30, 2018:

	Shares		Weighted Average Exercise Price		Weighted Average Grant Date Fair Value
Options outstanding, June 30, 2018	66,571		$	19.26	$	4.71
Forfeited	—		—		—
Expired	—		—		—
Exercised	(15,150	)	$	23.02	$	5.09
Options outstanding, September 30, 2018	51,421		$	18.15	$	4.60

The following table provides information about options outstanding for the nine months ended September 30, 2018:

	Shares		Weighted Average Exercise Price		Weighted Average Grant Date Fair Value
Options outstanding, December 31, 2017	115,246		$	20.73	$	4.86
Forfeited	—		—		—
Expired	—		—		—
Exercised	(63,825	)	$	22.81	$	5.06
Options outstanding, September 30, 2018	51,421		$	18.15	$	4.60

As of September 30, 2018 there were no unvested options.

Proceeds, related tax benefits realized from options exercised and intrinsic value of options exercised were as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2018		2017		2018		2017
Proceeds from exercise of stock options	$	349	$	283	$	1,456	$	1,288
Related tax benefit recognized	81		96		312		402
Net proceeds of options exercised	$	430	$	379	$	1,768	$	1,690
Intrinsic value of options exercised	$	386	$	273	$	1,484	$	1,147

Page 46

The following table provides information about options outstanding and exercisable at September 30, 2018:

(dollars in thousands, except share data and exercise price)	Outstanding		Exercisable
Number of shares	51,421		51,421
Weighted average exercise price	$	18.15	$	18.15
Aggregate intrinsic value	$	1,478	$	1,478
Weighted average remaining contractual term in years	0.9		0.9

C. Restricted Stock Units and Performance StockUnits

The Corporation has granted RSUs and PSUs under the 2007 LTIP and 2010 LTIP and in accordance with Rule 5635(c)(4) of the NASDAQ listing standards.

RSUs

The compensation expense for the RSUs is measured based on the market price of the stock on the day prior to the grant date and is recognized on a straight-line basis over the vesting period.

For the three and nine months ended September 30, 2018, the Corporation recognized $318 thousand and $873 thousand, respectively, of expense related to the Corporation’s RSUs. As of September 30, 2018, there was $2.3 million of unrecognized compensation cost related to RSUs. This cost will be recognized over a weighted average period of 2.3 years.

The following table details the RSUs for the three and nine months ended September 30, 2018:

	Three Months Ended September 30, 2018				Nine Months Ended September 30, 2018
	Number of Shares		Weighted Average Grant Date Fair Value		Number of Shares		Weighted Average Grant Date Fair Value
Beginning balance	68,595		$	36.89	75,707		$	35.80
Granted	23,843		$	46.29	26,243		$	46.07
Vested	(16,122	)	$	33.65	(24,469	)	$	32.16
Forfeited	—		$	—	(1,165	)	$	35.36
Ending balance	76,316		$	40.51	76,316		$	40.51

PSUs

For the three and nine months ended September 30, 2018, the Corporation recognized $390 thousand and $1.1 million, respectively, of expense related to the PSUs. As of September 30, 2018, there was $3.3 million of unrecognized compensation cost related to PSUs. This cost will be recognized over a weighted average period of 2.2 years.

The following table details the PSUs for the three and nine months ended September 30, 2018:

	Three Months Ended September 30, 2018				Nine Months Ended September 30, 2018
	Number of Shares		Weighted Average Grant Date Fair Value		Number of Shares		Weighted Average Grant Date Fair Value
Beginning balance	130,260		$	26.73	168,453		$	24.76
Granted	40,722		$	44.56	40,722		$	44.56
Vested	(48,056	)	$	16.04	(81,840	)	$	16.40
Forfeited	—		$	—	(4,409	)	$	26.57
Ending balance	122,926		$	36.82	122,926		$	36.82

Page 47

Note19-Fair Value Measurement

FASB ASC 820, “Fair Value Measurements and Disclosures,” defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosures about fair value measurements. FASB ASC 820 also establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).

The three levels of the fair value hierarchy under FASB ASC Topic 820 are:

Level 1 – Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

Level 2 – Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active and model derived valuations whose inputs are observable or whose significant value drivers are observable.

Level 3 – Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity).

A.Assets and liabilities measured on a recurring basis

A description of the valuation methodologies used for financial instruments measured at fair value on a recurring basis, as well as the general classification of such instruments pursuant to the valuation hierarchy, is set forth below. 

Investment Securities

The value of the Corporation’s available for sale investment securities, which include obligations of the U.S. government and its agencies, mortgage-backed securities issued by U.S. government- and U.S. government sponsored agencies, obligations of state and political subdivisions, corporate bonds and other debt securities are determined by the Corporation, taking into account the input of an independent third party valuation service provider. The third party’s evaluations are based on market data, utilizing pricing models that vary by asset and incorporate available trade, bid and other market information. For securities that do not trade on a daily basis, their pricing models apply available information such as benchmarking and matrix pricing. The market inputs normally sought in the evaluation of securities include benchmark yields, reported trades, broker/dealer quotes (only obtained from market makers or broker/dealers recognized as market participants), issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data. For certain securities, additional inputs may be used or some market inputs may not be applicable. Inputs are prioritized differently on any given day based on market conditions. Management reviews, annually, the process utilized by its independent third-party valuation service provider. On a quarterly basis, management tests the validity of the prices provided by the third party by selecting a representative sample of the portfolio and obtaining actual trade results, or if actual trade results are not available, competitive broker pricing. On an annual basis, management evaluates, for appropriateness, the methodology utilized by the independent third-party valuation service provider.

U.S. Government agencies are evaluated and priced using multi-dimensional relational models and option adjusted spreads. State and municipal securities are evaluated on a series of matrices including reported trades and material event notices. Mortgage-backed securities are evaluated using matrix correlation to treasury or floating index benchmarks, prepayment speeds, monthly payment information and other benchmarks. Other available-for-sale investments are evaluated using a broker-quote based application, including quotes from issuers.

Interest Rate Swaps and Risk Participation Agreements 

The Corporation’s interest rate swaps and RPAs are reported at fair value utilizing Level 2 inputs. Prices of these instruments are obtained through an independent pricing source utilizing pricing information which may include market observed quotations for swaps, LIBOR rates, forward rates and rate volatility. When entering into a derivative contract, the Corporation is exposed to fair value changes due to interest rate movements, and the potential non-performance of our contract counterparty. The Corporation has developed a methodology to value the non-performance risk based on internal credit risk metrics and the unique characteristics of derivative instruments, which include notional exposure rather than principle at risk and interest payment netting. The results of this methodology are used to adjust the base fair value of the instrument for the potential counterparty credit risk.

Page 48

The following tables present the Corporation’s assets measured at fair value on a recurring basis as of September 30, 2018 and December 31, 2017:

As of September 30, 2018
(dollars in thousands)	Total		Level 1		Level 2		Level 3
Investment securities available for sale:
U.S. Treasury securities	$	100	$	100	$	—	$	—
Obligations of U.S. government & agencies	190,453		—		190,453		—
Obligations of state & political subdivisions	15,799		—		15,799		—
Mortgage-backed securities	284,421		—		284,421		—
Collateralized mortgage obligations	36,193		—		36,193		—
Other investment securities	1,098		—		1,098		—
Total investment securities available for sale	$	528,064	$	100	$	527,964	$	—
Investment securities trading:
Mutual funds	$	8,340	$	8,340	$	—	$	—
Derivatives:
Interest rate swaps	$	5,886	$	—	$	5,886	$	—
Total recurring fair value measurements	$	542,290	$	8,440	$	533,850	$	—

As of December 31, 2017
(dollars in thousands)	Total		Level 1		Level 2		Level 3
Investment securities available for sale:
U.S. Treasury securities	$	200,088	$	200,088	$	—	$	—
Obligations of U.S. government & agencies	151,044		—		151,044		—
Obligations of state & political subdivisions	21,310		—		21,310		—
Mortgage-backed securities	274,990		—		274,990		—
Collateralized mortgage obligations	36,662		—		36,662		—
Mutual funds	3,509		3,509		—		—
Other investment securities	1,599		—		1,599		—
Total investment securities available for sale	$	689,202	$	203,597	$	485,605	$	—
Investment securities trading:
Mutual funds	$	4,610	$	4,610	$	—	$	—
Derivatives:
Interest rate swaps	$	1,898	$	—	$	1,898	$	—
Total recurring fair value measurements	$	695,710	$	208,207	$	487,503	$	—

There have been no transfers between levels during the three and nine months ended September 30, 2018.

B.Assets and liabilities measured on anon-recurring basis

Fair value is used on a nonrecurring basis to evaluate certain financial assets and financial liabilities in specific circumstances.  Similarly, fair value is used on a nonrecurring basis for nonfinancial assets and nonfinancial liabilities such as foreclosed assets, OREO, intangible assets, nonfinancial assets and liabilities evaluated in a goodwill impairment analysis and other nonfinancial assets measured at fair value for purposes of assessing impairment.  A description of the valuation methodologies used for financial and nonfinancial assets and liabilities measured at fair value, as well as the general classification of such assets and liabilities pursuant to the valuation hierarchy, is set forth below.

Page 49

Impaired Loans

Management evaluates and values impaired loans at the time the loan is identified as impaired, and the fair values of such loans are estimated using Level 3 inputs in the fair value hierarchy. Each loan’s collateral has a unique appraisal and management’s discount of the value is based on the factors unique to each impaired loan. The significant unobservable input in determining the fair value is management’s subjective discount on appraisals of the collateral securing the loan, which range from 10% - 50%. Collateral may consist of real estate and/or business assets including equipment, inventory and/or accounts receivable and the value of these assets is determined based on the appraisals by qualified licensed appraisers hired by the Corporation. Appraised and reported values may be discounted based on management’s historical knowledge, changes in market conditions from the time of valuation, estimated costs to sell, and/or management’s expertise and knowledge of the client and the client’s business.

The Corporation has an appraisal policy in which an appraisal is obtained for a commercial loan at the point at which the loan either becomes nonperforming or is downgraded to a substandard or worse classification. For consumer loans, management obtains updated appraisals when a loan becomes 90 days past due or when it receives other information that may indicate possible impairment. Based on the appraisals obtained by the Corporation, a partial or full charge-off may be necessary. 

Other Real Estate Owned

OREO consists of properties acquired as a result of foreclosures and deeds in-lieu-of foreclosure. Properties classified as OREO are reported at the lower of cost or fair value less cost to sell, and are classified as Level 3 in the fair value hierarchy.

Mortgage Servicing Rights

The model to value MSRs estimates the present value of projected net servicing cash flows of the remaining servicing portfolio based on various assumptions, including changes in anticipated loan prepayment rates, the discount rate, reflective of a market participant's required return on an investment for similar assets, and other market-based economic factors. All of these assumptions are considered to be unobservable inputs. Accordingly, MSRs are classified within Level 3 of the fair value hierarchy.

The following tables present the Corporation’s assets measured at fair value on a non-recurring basis as of September 30, 2018 and December 31, 2017:

As of September 30, 2018
(dollars in thousands)	Total		Level 1		Level 2		Level 3
MSRs	$	6,586	$	—	$	—	$	6,586
Impaired loans and leases	12,593		—		—		12,593
OREO	529		—		—		529
Total non-recurring fair value measurements	$	19,708	$	—	$	—	$	19,708

As of December 31, 2017
(dollars in thousands)	Total		Level 1		Level 2		Level 3
MSRs	$	6,397	$	—	$	—	$	6,397
Impaired loans and leases	13,954		—		—		13,954
OREO	304		—		—		304
Total non-recurring fair value measurements	$	20,655	$	—	$	—	$	20,655

During the three and nine months ended September 30, 2018, a decrease of $148 thousand and an increase of $20 thousand, respectively, were recorded in the Allowance as a result of adjusting the carrying value and estimated fair value of the impaired loans in the above tables.

Page 50

Note 20- Fair Value of Financial Instruments

FASB ASC 825, “Disclosures about Fair Value of Financial Instruments” requires disclosure of the fair value information about financial instruments, whether or not recognized in the balance sheet, for which it is practicable to estimate such value. The methodologies for estimating the fair value of financial assets and financial liabilities measured at fair value on a recurring and non-recurring basis are discussed above. The estimated fair value amounts have been determined by management using available market information and appropriate valuation methodologies, are based on the exit price notion set forth by ASU 2016-1 effective January 1, 2018, and are applied to this disclosure on a prospective basis. Estimated fair value of assets and liabilities carried at cost as of December 31, 2017 were based on an entry price notion. In cases where quoted market prices are not available, fair values are based on estimates using present value or other market value 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. The aggregate fair value amounts presented below do not represent the underlying value of the Corporation.

The carrying amount and fair value of the Corporation’s financial instruments are as follows:

		As of September 30, 2018				As of December 31, 2017
(dollars in thousands)	Fair Value Hierarchy Level*	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Financial assets:
Cash and cash equivalents	Level 1	$	45,354	$	45,354	$	60,024	$	60,024
Investment securities - available for sale	See Note 19	528,064		528,064		689,202		689,202
Investment securities - trading	See Note 19	8,340		8,340		4,610		4,610
Investment securities – held to maturity	Level 2	8,916		8,544		7,932		7,851
Loans held for sale	Level 2	4,111		4,111		3,794		3,794
Net portfolio loans and leases	Level 3	3,362,791		3,362,757		3,268,333		3,293,802
MSRs	Level 3	5,328		6,586		5,861		6,397
Interest rate swaps	Level 2	5,843		5,843		1,895		1,895
RPAs purchased	Level 2	43		43		21		21
Other assets	Level 3	44,439		44,439		46,799		46,799
Total financial assets		$	4,013,229	$	4,014,081	$	4,088,471	$	4,114,395
Financial liabilities:
Deposits	Level 2	$	3,357,226	$	3,351,183	$	3,373,798	$	3,368,276
Short-term borrowings	Level 2	226,498		226,498		237,865		237,865
Long-term FHLB advances	Level 2	72,841		71,978		139,140		138,685
Subordinated notes	Level 2	98,482		97,892		98,416		95,044
Junior subordinated debentures	Level 2	21,538		23,564		21,416		19,366
Interest rate swaps	Level 2	5,843		5,843		1,895		1,895
RPAs sold	Level 2	1		1		3		3
Other liabilities	Level 3	60,432		60,432		49,071		49,071
Total financial liabilities		$	3,842,861	$	3,837,391	$	3,921,604	$	3,910,205

* See Note 19 in the Notes to Unaudited Consolidated Financial Statements above for a description of hierarchy levels.

Page 51

Note 21- Financial Instruments with Off-Balance Sheet Risk, Contingencies and Concentration of Credit Risk

Off-Balance Sheet Arrangements

The Corporation 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 include commitments to extend credit and standby letters of credit. Those instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the consolidated statements of financial condition. The contractual amounts of those instruments reflect the extent of involvement the Corporation has in particular classes of financial instruments.

The Corporation’s exposure to credit loss in the event of nonperformance by the counterparty to the financial instrument of commitments to extend credit and standby letters of credit is represented by the contractual amount of those instruments. The Corporation uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet financial instruments.

Commitments to extend credit, which include unused lines of credit and unfunded commitments to originate loans, are agreements to lend to a customer as long as there is no violation of any condition established in the agreement. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Some of the commitments are expected to expire without being drawn upon, and the total commitment amounts do not necessarily represent future cash requirements. Total commitments to extend credit at September 30, 2018 and December 31, 2017 were $764.7 million and $748.3 million, respectively. Management evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Corporation upon extension of credit, is based on a credit evaluation of the counterparty. Collateral varies but may include accounts receivable, marketable securities, inventory, property, plant and equipment, residential real estate, and income-producing commercial properties.

Standby letters of credit are conditional commitments issued by the Bank to a customer for a third party. Such standby letters of credit are issued to support private borrowing arrangements. The credit risk involved in issuing standby letters of credit is similar to that involved in extending loan facilities to customers. The collateral varies, but may include accounts receivable, marketable securities, inventory, property, plant and equipment, and residential real estate for those commitments for which collateral is deemed necessary. The Corporation’s obligations under standby letters of credit as of September 30, 2018 and December 31, 2017 were $21.2 million and $17.7 million, respectively.

Contingencies

Legal Matters

In the ordinary course of its operations, the Corporation and its subsidiaries are parties to various claims, litigation, investigations, and legal and administrative cases and proceedings.  Such pending or threatened claims, litigation, investigations, legal and administrative cases and proceedings typically entail matters that are considered ordinary routine litigation incidental to our business. Claims for significant monetary damages may be asserted in many of these types of legal actions. Based on the information currently available, management believes it has meritorious defenses to the claims asserted against it in its currently outstanding legal proceedings and with respect to such legal proceedings, intends to continue to defend itself vigorously, litigating or settling cases according to management’s judgment as to what is in the best interests of the Corporation and its shareholders.

On a regular basis, liabilities and contingencies in connection with outstanding legal proceedings are assessed utilizing the latest information available. For those matters where it is probable that the Corporation will incur a loss and the amount of the loss can be reasonably estimated, a liability may be recorded in the Consolidated Financial Statements. These legal reserves may be increased or decreased to reflect any relevant developments on at least a quarterly basis. For other matters, where a loss is not probable or the amount or range of the loss is not estimable, legal reserves are not accrued. While the outcome of legal proceedings is inherently uncertain, based on information currently available, advice of counsel and available insurance coverage, management believes that the established legal reserves are adequate and the liabilities arising from legal proceedings will not have a material adverse effect on the consolidated financial position, consolidated results of operations or consolidated cash flows. However, in the event of unexpected future developments, it is possible that the ultimate resolution of these matters, if unfavorable, may be material to the consolidated financial position, consolidated results of operations or consolidated cash flows of the Corporation.

Page 52

Indemnifications

In general, the Corporation does not sell loans with recourse, except to the extent that it arises from standard loan-sale contract provisions. These provisions cover violations of representations and warranties and, under certain circumstances, first payment default by borrowers. These indemnifications may include the repurchase of loans by the Corporation, and are considered customary provisions in the secondary market for conforming mortgage loan sales. Repurchases and losses have been rare and no provision is made for losses at the time of sale. There were no such repurchases for the three or nine months ended September 30, 2018.

Concentrations of Credit Risk

The Corporation has a material portion of its loans in real estate-related loans. A predominant percentage of the Corporation’s real estate exposure, both commercial and residential, is in the Corporation’s primary trade area which includes portions of Delaware, Chester, Montgomery and Philadelphia counties in Southeastern Pennsylvania. Management is aware of this concentration and attempts to mitigate this risk to the extent possible in many ways, including the underwriting and assessment of borrower’s capacity to repay. See Note 5 – “Loans and Leases” for additional information.

Note 22 - Segment Information

FASB Codification 280 – “Segment Reporting” identifies operating segments as components of an enterprise which are evaluated regularly by the Corporation’s chief operating decision maker, our Chief Executive Officer, in deciding how to allocate resources and assess performance. The Corporation has applied the aggregation criterion set forth in this codification to the results of its operations.

The Corporation’s Banking segment consists of commercial and retail banking. The Banking segment is evaluated as a single strategic unit which generates revenues from a variety of products and services. The Banking segment generates interest income from its lending (including leases) and investing activities and is dependent on the gathering of lower cost deposits from its branch network or borrowed funds from other sources for funding its loans, resulting in the generation of net interest income. The Banking segment also derives revenues from other sources including gains on the sale in available for sale investment securities, gains on the sale of residential mortgage loans, service charges on deposit accounts, cash sweep fees, overdraft fees, BOLI income and revenue associated with its Visa Check Card offering. Also included in the Banking segment are two subsidiaries of the Bank, KCMI Capital, Inc. and Bryn Mawr Equipment Financing, Inc., both of which provide specialized lending solutions to our customers.

The Wealth Management segment has responsibility for a number of activities within the Corporation, including trust administration, other related fiduciary services, custody, investment management and advisory services, employee benefits and IRA administration, estate settlement, tax services and brokerage. Bryn Mawr Trust of Delaware and Lau Associates are included in the Wealth Management segment of the Corporation since they have similar economic characteristics, products and services to those of the Wealth Management Division of the Corporation. BMT Investment Advisers, formed in May 2017, which serves as investment adviser to BMT Investment Funds, a Delaware statutory trust, is also reported under the Wealth Management segment. In addition, the Wealth Management Division oversees all insurance services of the Corporation, which are conducted through the Bank’s insurance subsidiary, BMT Insurance Advisors, Inc., and are reported in the Wealth Management segment.

The accounting policies of the Corporation are applied by segment in the following tables. The segments are presented on a pre-tax basis.

The following tables detail the Corporation’s segments for the three and nine months ended September 30, 2018 and 2017:

Page 53

	Three Months Ended September 30, 2018									Three Months Ended September 30, 2017
(dollars in thousands)	Banking			Wealth Management			Consolidated			Banking			Wealth Management			Consolidated
Net interest income	$	36,726		$	3		$	36,729		$	29,437		$	1		$	29,438
Provision for loan and lease losses	664			—			664			1,333			—			1,333
Net interest income after loan loss provision	36,062			3			36,065			28,104			1			28,105
Noninterest income:
Fees for wealth management services	—			10,343			10,343			—			9,651			9,651
Insurance commissions	—			1,754			1,754			—			1,373			1,373
Capital markets revenue	710			—			710			843			—			843
Service charges on deposit accounts	726			—			726			676			—			676
Loan servicing and other fees	559			—			559			548			—			548
Net gain on sale of loans	631			—			631			799			—			799
Net gain on sale of investment securities available for sale	—			—			—			72			—			72
Net gain on sale of OREO	5			—			5			—			—			—
Other operating income	3,498			48			3,546			1,581			41			1,622
Total noninterest income	6,129			12,145			18,274			4,519			11,065			15,584
Noninterest expenses:
Salaries & wages	11,737			4,791			16,528			9,130			4,472			13,602
Employee benefits	2,394			962			3,356			1,587			973			2,560
Occupancy and bank premises	2,224			493			2,717			2,049			436			2,485
Amortization of intangible assets	386			505			891			197			480			677
Professional fees	889			108			997			681			58			739
Other operating expenses	7,770			1,333			9,103			6,970			1,151			8,121
Total noninterest expenses	25,400			8,192			33,592			20,614			7,570			28,184
Segment profit	16,791			3,956			20,747			12,009			3,496			15,505
Intersegment (revenues) expenses*	(186		)	186			—			(112		)	112			—
Pre-tax segment profit after eliminations	$	16,605		$	4,142		$	20,747		$	11,897		$	3,608		$	15,505
% of segment pre-tax profit after eliminations	80.0		%	20.0		%	100.0		%	76.7		%	23.3		%	100.0		%
Segment assets (dollars in millions)	$	4,335.8		$	52.6		$	4,388.4		$	3,424.8		$	52.0		$	3,476.8

Page 54

	Nine Months Ended September 30, 2018									Nine Months Ended September 30, 2017
(dollars in thousands)	Banking			Wealth Management			Consolidated			Banking			Wealth Management			Consolidated
Net interest income	$	111,479		$	5		$	111,484		$	84,804		$	2		$	84,806
Provision for loan and lease losses	4,831			—			4,831			1,541			—			1,541
Net interest income after loan loss provision	106,648			5			106,653			83,263			2			83,265
Noninterest income:
Fees for wealth management services	—			31,309			31,309			—			28,761			28,761
Insurance commissions	—			5,349			5,349			—			3,079			3,079
Capital markets revenue	3,481			—			3,481			1,796			—			1,796
Service charges on deposit accounts	2,191			—			2,191			1,953			—			1,953
Loan servicing and other fees	1,720			—			1,720			1,570			—			1,570
Net gain on sale of loans	1,677			—			1,677			1,948			—			1,948
Net gain on sale of investment securities available for sale	7			—			7			73			—			73
Net gain (loss) gain on sale of OREO	292			—			292			(12		)	—			(12		)
Other operating income	11,709			150			11,859			4,290			138			4,428
Total noninterest income	21,077			36,808			57,885			11,618			31,978			43,596
Noninterest expenses:
Salaries & wages	34,077			14,673			48,750			27,044			12,588			39,632
Employee benefits	6,992			2,949			9,941			4,565			2,888			7,453
Occupancy and bank premises	7,035			1,429			8,464			6,025			1,233			7,258
Amortization of intangible assets	1,169			1,490			2,659			588			1,469			2,057
Professional fees	2,497			180			2,677			2,318			181			2,499
Other operating expenses	29,076			3,891			32,967			21,200			3,240			24,440
Total noninterest expenses	80,846			24,612			105,458			61,740			21,599			83,339
Segment profit	46,879			12,201			59,080			33,141			10,381			43,522
Intersegment (revenues) expenses*	(485		)	485			—			(336		)	336			—
Pre-tax segment profit after eliminations	$	46,394		$	12,686		$	59,080		$	32,805		$	10,717		$	43,522
% of segment pre-tax profit after eliminations	78.5		%	21.5		%	100.0		%	75.4		%	24.6		%	100.0		%
Segment assets (dollars in millions)	$	4,335.8		$	52.6		$	4,388.4		$	3,424.8		$	52.0		$	3,476.8

*Inter-segment revenues consist of rental payments, interest on deposits and management fees.

Wealth Management Segment Information

(dollars in millions)	September 30, 2018		December 31, 2017
Assets under management, administration, supervision and brokerage	$	13,913.3	$	12,968.7

Page 55

ITEM 2. Management’s Discussion and Analysis of Results of Operation and Financial Condition

The following is the Corporation’s discussion and analysis of the significant changes in the financial condition, results of operations, capital resources and liquidity presented in the accompanying Unaudited Consolidated Financial Statements. Current performance does not guarantee, and may not be indicative of, similar performance in the future.

Brief History of the Corporation

The Bryn Mawr Trust Company (the “Bank”) received its Pennsylvania banking charter in 1889 and is a member of the Federal Reserve System. In 1986, Bryn Mawr Bank Corporation (the “Corporation”) was formed and on January 2, 1987, the Bank became a wholly-owned subsidiary of the Corporation. The Bank and Corporation are headquartered in Bryn Mawr, Pennsylvania, a western suburb of Philadelphia. The Corporation and its subsidiaries offer a full range of personal and business banking services, consumer and commercial loans, equipment leasing, mortgages, insurance and wealth management services, including investment management, trust and estate administration, retirement planning, custody services, and tax planning and preparation from 36 branches, eight limited-hour retirement community offices, six wealth management offices and a full-service insurance agency located throughout Montgomery, Delaware, Chester, Philadelphia, Berks, and Dauphin counties in Pennsylvania, Mercer and Camden counties of New Jersey, and New Castle county in Delaware. The common stock of the Corporation trades on the NASDAQ Stock Market (“NASDAQ”) under the symbol BMTC.

The Corporation operates in a highly competitive market area that includes local, national and regional banks as competitors along with savings banks, credit unions, insurance companies, trust companies, registered investment advisors and mutual fund families. The Corporation and its subsidiaries are regulated by many agencies including the Securities and Exchange Commission (“SEC”), NASDAQ, Federal Deposit Insurance Corporation (“FDIC”), the Federal Reserve and the Pennsylvania Department of Banking and Securities. The goal of the Corporation is to become the preeminent community bank and wealth management organization in the Philadelphia area.

Critical Accounting Policies, Judgments and Estimates

The accounting and reporting policies of the Corporation and its subsidiaries conform with U.S. generally accepted accounting principles (“GAAP”). All inter-company transactions are eliminated in consolidation and certain reclassifications are made when necessary to conform the previous year’s financial statements to the current year’s presentation. In preparing the Consolidated Financial Statements, the Corporation is required to make estimates and assumptions that affect the reported amount of assets and liabilities as of the dates of the balance sheets and revenues and expenditures for the periods presented. However, there are uncertainties inherent in making these estimates and actual results could differ from these estimates. The Corporation has identified certain areas that require estimates and assumptions, which include the Allowance, the valuation of goodwill and intangible assets, the fair value of investment securities, the fair value of derivative financial instruments, and the valuation of mortgage servicing rights, deferred tax assets and liabilities, benefit plans and stock-based compensation. The Corporation’s derivative financial instruments are not exchange-traded and therefore are valued utilizing models that use as their basis readily observable market parameters, specifically the London Interbank Offered Rate (“LIBOR”) swap curve, and are classified within Level 2 of the valuation hierarchy. In addition, certain assets are measured at fair value on a nonrecurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment).

These critical accounting policies, along with other significant accounting policies, are presented in Footnote 1 – Summary of Significant Accounting Policies, in the Notes to the audited Consolidated Financial Statements in the Corporation’s Annual Report on Form 10-K for the twelve months ended December 31, 2017 (the "2017 Annual Report").

Recent Acquisitions and Expansions

On May 1, 2018, BMT Insurance Advisors, Inc. acquired Domenick & Associates, a full-service insurance agency established in 1993 and headquartered in the Old City section of Philadelphia. Domenick & Associates has a specialty niche with nonprofit and social service organizations which aligns well with our banking and wealth management solutions in these specialty service areas. This acquisition furthers our objective of pursuing strategic growth opportunities to enhance, broaden, and diversify our revenue streams.

On December 15, 2017 (the "Effective Date"), the merger of Royal Bancshares of Pennsylvania, Inc. (“RBPI”) with and into the Corporation (collectively, the “RBPI Merger”), and the merger of Royal Bank America with and into the Bank, were completed. Consideration totaled $138.7 million, comprised of 3,101,316 shares of the Corporation’s common stock, the assumption of 140,224 warrants to purchase Corporation common stock, valued at $1.9 million, $112 thousand for the cash-out

Page 56

of certain options and $7 thousand cash in lieu of fractional shares. Including the effects of any measurement period adjustments in accordance with ASC 805-10, the RBPI Merger initially added $566.2 million of loans, $121.6 million of investments, $593.2 million of deposits, twelve new branches and a loan production office. The acquisition of RBPI expanded the Corporation’s footprint within Montgomery, Chester, Berks and Philadelphia Counties in Pennsylvania as well as Camden and Mercer Counties in New Jersey.

In addition to the RBPI Merger, the Bank has continued to execute on its strategies of diversification and acquiring and/or establishing specialty offices in strategically targeted areas where management believes there to be a high demand for the Bank’s products and services. On May 24, 2017, the Bank completed its acquisition of Hirshorn Boothby, a full-service insurance agency established in 1931 and headquartered in the Chestnut Hill section of Philadelphia. Hirshorn Boothby was immediately merged into the Bank’s existing insurance subsidiary, BMT Insurance Advisors, Inc., formerly known as Powers Craft Parker and Beard, Inc., expanding the footprint of this growing segment.

On May 12, 2017, the Corporation established a wealth management-focused office in Princeton, New Jersey which complements the already-established presence in central New Jersey that was acquired in the RBPI Merger.

Beginning in the second quarter of 2017, the Bank’s Capital Markets department commenced operations focusing on providing risk management services to address the needs of its commercial customer base. These capital markets capabilities enable the Bank to offer hedging tools for qualified commercial customers through the use of interest rate swaps and options designed to mitigate the interest rate risk on variable rate loans. This interest rate hedging offering allows the Bank to participate and lead in larger and longer-dated credits without incurring additional interest rate risk. Additional services will focus on assisting qualified customers in hedging their foreign exchange risk and meeting their trade finance needs through enhanced international services capabilities.

Executive Overview 

The following items highlight the Corporation’s results of operations for the three and nine months ended September 30, 2018, as compared to the same periods in 2017, and the changes in its financial condition as of September 30, 2018 as compared to December 31, 2017. More detailed information related to these highlights can be found in the sections that follow.

Three Month Results of Operations

• Net income attributable to Bryn Mawr Bank Corporation for the three months ended September 30, 2018 was $16.7 million, an increase of $6.0 million as compared to $10.7 million for the same period in 2017. Diluted earnings per share was $0.82 for the three months ended September 30, 2018 as compared to $0.62 for the same period in 2017.

• Return on average equity (“ROE”) and return on average assets (“ROA”) for the three months ended September 30, 2018 were 12.08% and 1.51%, respectively, as compared to ROE and ROA of 10.72% and 1.24% respectively, for the same period in 2017.

• Tax-equivalent net interest income increased $7.3 million, or 24.3%, to $36.9 million for the three months ended September 30, 2018, as compared to $29.6 million for the same period in 2017.

• Provision for loan and lease losses (the “Provision”) of $664 thousand for the three months ended September 30, 2018 was a decrease of $669 thousand from the $1.3 million Provision recorded for the same period in 2017.

• Noninterest income of $18.3 million for the three months ended September 30, 2018increased$2.7 million as compared to $15.6 million for the same period in 2017.

• Fees for wealth management services and insurance commissions of $10.3 million and $1.8 million, respectively, for the three months ended September 30, 2018 increased $692 thousand and $381 thousand, respectively, as compared to the same period in 2017. Capital markets revenue of $710 thousand for the three months ended September 30, 2018 decreased $133 thousand as compared to the same period in 2017.

• Noninterest expense of $33.6 million for the three months ended September 30, 2018increased$5.4 million, from $28.2 million for the same period in 2017.

Page 57

Nine Month Results of Operations

• Net income attributable to Bryn Mawr Bank Corporation for the nine months ended September 30, 2018 was $46.7 million, an increase of $17.5 million as compared to $29.2 million for the same period in 2017. Diluted earnings per share was $2.28 for the nine months ended September 30, 2018 as compared to $1.69 for the same period in 2017.

• Return on average equity and return on average assets for the nine months ended September 30, 2018 were 11.62% and 1.44%, respectively, as compared to ROE and ROA of 10.02% and 1.17% respectively, for the same period in 2017.

• Tax-equivalent net interest income increased $26.4 million, or 30.9%, to $111.8 million for the nine months ended September 30, 2018, as compared to $85.4 million for the same period in 2017.

• The Provision of $4.8 million for the nine months ended September 30, 2018 was an increase of $3.3 million from the $1.5 million Provision recorded for the same period in 2017.

• Noninterest income of $57.9 million for the nine months ended September 30, 2018increased$14.3 million as compared to $43.6 million for the same period in 2017.

• Fees for wealth management services, insurance commissions, and capital markets revenue of $31.3 million, $5.3 million, and $3.5 million, respectively, for the nine months ended September 30, 2018 increased of $2.5 million, $2.3 million, and $1.7 million, respectively, as compared to the same period in 2017.

• Noninterest expense of $105.5 million for the nine months ended September 30, 2018increased $22.2 million, from $83.3 million for the same period in 2017.

Changes in Financial Condition

• Total assets of $4.39 billion as of September 30, 2018decreased$61.3 million from $4.45 billion as of December 31, 2017.

• Total shareholders’ equity of $551.4 million as of September 30, 2018increased$23.3 million from $528.1 million as of December 31, 2017.

• Total portfolio loans and leases as of September 30, 2018 were $3.38 billion, an increase of $95.6 million from $3.29 billion as of December 31, 2017.

• Total non-performing loans and leases of $9.0 million represented 0.27% of portfolio loans and leases as of September 30, 2018 as compared to $8.6 million, or 0.26% of portfolio loans and leases as of December 31, 2017.

• The $18.7 million Allowance, as of September 30, 2018, represented 0.55% of portfolio loans and leases, as compared to $17.5 million or 0.53% of portfolio loans and leases as of December 31, 2017.

• Total deposits of $3.36 billion as of September 30, 2018decreased$16.6 million from $3.37 billion as of December 31, 2017.

• Wealth assets under management, administration, supervision and brokerage as of September 30, 2018 were $13.91 billion, an increase of $944.5 million from $12.97 billionDecember 31, 2017.

Page 58

Key Performance Ratios

Key financial performance ratios for the three and nine months ended September 30, 2018 and 2017 are shown in the table below:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2018			2017			2018			2017
Return on average equity	12.08		%	10.72		%	11.62		%	10.02		%
Return on average assets	1.51		%	1.24		%	1.44		%	1.17		%
Tax-equivalent net interest margin	3.69		%	3.71		%	3.81		%	3.71		%
Basic earnings per share	$	0.82		$	0.63		$	2.31		$	1.72
Diluted earnings per share	$	0.82		$	0.62		$	2.28		$	1.69
Dividends paid or accrued per share	$	0.25		$	0.22		$	0.69		$	0.64
Dividends paid or accrued per share to net income per basic common share	30.5		%	34.9		%	29.9		%	37.2		%

The following table presents certain key period-end balances and ratios as of September 30, 2018 and December 31, 2017:

(dollars in millions, except per share amounts)	September 30, 2018			December 31, 2017
Book value per share	$	27.18		$	26.19
Tangible book value per share	$	16.95		$	16.02
Allowance as a percentage of portfolio loans and leases	0.55		%	0.53		%
Tier I capital to risk weighted assets	10.90		%	10.42		%
Tangible common equity ratio	8.23		%	7.61		%
Loan to deposit ratio	100.7		%	97.4		%
Wealth assets under management, administration, supervision and brokerage	$	13,913.3		$	12,968.7
Portfolio loans and leases	$	3,381.5		$	3,285.9
Total assets	$	4,388.4		$	4,449.7
Total shareholders’ equity	$	551.4		$	528.1

The following sections discuss, in greater detail, the Corporation’s results of operations for the three and nine months ended September 30, 2018, as compared to the same periods in 2017, and the changes in its financial condition as of September 30, 2018 as compared to December 31, 2017.

Components of Net Income

Net income is comprised of five major elements:

• Net Interest Income, or the difference between the interest income earned on loans, leases and investments and the interest expense paid on deposits and borrowed funds;

• Provision for Loan and Lease Losses, or the amount added to the Allowance to provide for estimated inherent losses on portfolio loans and leases;

• Noninterest Income, which is made up primarily of wealth management revenue, capital markets revenue, gains and losses from the sale of residential mortgage loans, gains and losses from the sale of available for sale investment securities and other fees from loan and deposit services;

• Noninterest Expense, which consists primarily of salaries and employee benefits, occupancy, intangible asset amortization, professional fees, due diligence, merger-related and merger integration expenses, and other operating expenses; and

• Income Tax Expense, which include state and federal jurisdictions.

Page 59

TAX-EQUIVALENT NET INTEREST INCOME

Net interest income is the primary source of the Corporation’s revenue. The below tables present a summary, for the three and nine months ended September 30, 2018 and 2017, of the Corporation’s average balances and tax-equivalent yields earned on its interest-earning assets and the rates paid on its interest-bearing liabilities. The tax-equivalent net interest margin is the tax-equivalent net interest income as a percentage of average interest-earning assets. The tax-equivalent net interest spread is the difference between the weighted average tax-equivalent yield on interest-earning assets and the weighted average cost of interest-bearing liabilities. The effect of noninterest-bearing liabilities represents the effect on the net interest margin of net funding provided by noninterest-earning assets, noninterest-bearing liabilities and shareholders’ equity.

Three Months Ended September 30, 2018 Compared to the Same Period in 2017

For the three months ended September 30, 2018, tax-equivalent net interest income increased $7.3 million, or 24.3%, to $36.9 million, as compared to $29.6 million for the same period in 2017. Tax-equivalent interest income and fees on loans and leases increased $11.2 million for the three months ended September 30, 2018 as compared to the same period in 2017. The increase in tax-equivalent interest and fees on loans and leases was primarily related to the $699.4 million increase in average loans to $3.38 billion for the three months ended September 30, 2018 from $2.68 billion for the three months ended September 30, 2017 coupled with a 36 basis point increase on the yield on loans and leases over the same period. The increase in average loans was largely related to the loans and leases acquired in the RBPI Merger which, including the effects of any measurement period adjustments in accordance with ASC 805-10, initially increased loans and leases by $566.2 million, as well as organic loan growth. Tax-equivalent interest income on available for sale investment securities increased by $749 thousand for the three months ended September 30, 2018 as compared to the same period in 2017. Average available for sale investment securities increased by $78.0 million for the third quarter of 2018 as compared to the third quarter of 2017 coupled with a 27 basis point increase in the yield on available for sale investment securities over the same period.

Interest expense on interest-bearing deposits, subordinated notes, short-term borrowings, and junior subordinated debentures increased $3.3 million, $774 thousand, $549 thousand, and $337 thousand, respectively, for the three months ended September 30, 2018 as compared to the same period in 2017. The increase in interest expense on interest-bearing deposits was primarily related to the $621.7 million increase in the average balance coupled with a 41 basis point increase in the yield on interest-bearing deposits over the same period. The increase in average interest-bearing deposits was largely related to the interest-bearing deposits assumed in the RBPI Merger, which initially totaled $494.8 million. The increase in interest expense on subordinated notes was primarily related to the $68.9 million increase in the average balance. The volume increase in subordinated notes was the result of the December 13, 2017 issuance of $70 million ten-year, 4.25% fixed-to-floating subordinated notes. The increase in interest expense on short-term borrowings was primarily attributed to a 90 basis point increase in rate paid for the third quarter of 2018 as compared to the same period in 2017. The increase in interest expense on junior subordinated debentures was related to the $21.5 million of junior subordinated debentures assumed in the RBPI Merger.

Nine Months Ended September 30, 2018 Compared to the Same Period in 2017

For the nine months ended September 30, 2018, tax-equivalent net interest income increased $26.4 million, or 30.9%, to $111.8 million, as compared to $85.4 million for the same period in 2017. Tax-equivalent interest and fees on loans and leases increased $35.8 million for the nine months ended September 30, 2018 as compared to the same period in 2017. The increase in tax-equivalent interest and fees on loans and leases was primarily related to the $724.1 million increase in average loans to $3.34 billion for the nine months ended September 30, 2018 from $2.62 billion as of September 30, 2017 coupled with a 44 basis point increase in the yield on loans and leases over the same period. The increase in average loans was largely related to the loans and leases acquired in the RBPI Merger which, including the effects of any measurement period adjustments in accordance with ASC 805-10, initially increased loans and leases by $566.2 million, as well as organic loan growth. Tax-equivalent interest income on available for sale investment securities increased by $2.6 million for the nine months ended September 30, 2018 as compared to the same period in 2017. Average available for sale investment securities increased by $108.0 million for the nine months ended September 30, 2018 as compared to the same period in 2017 coupled with a 25 basis point increase in the yield on available for sale investment securities over the same period.

Interest expense on interest-bearing deposits, subordinated notes, short-term borrowings, and junior subordinated debentures increased $7.5 million, $2.3 million, $1.9 million, and $946 thousand, respectively, for the nine months ended September 30, 2018 as compared to the same period in 2017. The increase in interest expense on interest-bearing deposits was primarily related to the $615.1 million increase in the average balance coupled with a 30 basis point increase in the yield on interest-bearing deposits over the same period. The increase in average interest-bearing deposits was largely related to the interest-bearing deposits assumed in the RBPI Merger, which initially totaled $494.8 million. The increase in interest expense on subordinated notes was primarily related to the $68.9 million increase in the average balance. The volume increase in

Page 60

subordinated notes was the result of the December 13, 2017 issuance of $70 million ten-year, 4.25% fixed-to-floating subordinated notes. The increase in interest expense on short-term borrowings was primarily attributed to the $85.2 million increase in the average balance coupled with a 90 basis point increase in rate paid for the nine months ended September 30, 2018 as compared to the same period in 2017. The increase in interest expense on junior subordinated debentures was related to the $21.5 million of junior subordinated debentures assumed in the RBPI Merger.

Analyses of Interest Rates and Interest Differential

The tables below present the major asset and liability categories on an average daily balance basis for the periods presented, along with interest income, interest expense and key rates and yields.

Page 61

	For the Three Months Ended September 30,
	2018							2017
(dollars in thousands)	Average Balance			Interest Income/ Expense		Average Rates Earned/ Paid		Average Balance			Interest Income/ Expense		Average Rates Earned/ Paid
Assets:
Interest-bearing deposits with banks	$	37,467		$	64	0.68	%	$	26,628		$	36	0.54	%
Investment securities - available for sale:
Taxable	514,360			2,960		2.28	%	427,106			2,160		2.01	%
Tax-exempt(4)	16,056			83		2.05	%	25,268			134		2.10	%
Total investment securities – available for sale	530,416			3,043		2.28	%	452,374			2,294		2.01	%
Investment securities – held to maturity	8,378			5		0.24	%	6,044			11		0.72	%
Investment securities – trading	8,204			30		1.45	%	4,282			8		0.74	%
Loans and leases(1)(2)(3)(4)	3,379,699			42,214		4.96	%	2,680,317			31,058		4.60	%
Total interest-earning assets	3,964,164			45,356		4.54	%	3,169,645			33,407		4.18	%
Cash and due from banks	7,587							15,709
Allowance for loan and lease losses	(19,467		)					(16,564		)
Other assets	423,864							273,116
Total assets	$	4,376,148						$	3,441,906
Liabilities:
Savings, NOW, and market rate accounts	$	1,695,214		$	2,425	0.57	%	$	1,359,293		$	823	0.24	%
Wholesale deposits	256,347			1,329		2.06	%	190,849			548		1.14	%
Retail time deposits	541,652			1,779		1.30	%	321,352			827		1.02	%
Total interest-bearing deposits	2,493,213			5,533		0.88	%	1,871,494			2,198		0.47	%
Short-term borrowings	208,201			1,096		2.09	%	182,845			547		1.19	%
Long-term FHLB advances	81,460			394		1.92	%	155,918			645		1.64	%
Subordinated notes	98,457			1,144		4.61	%	29,564			370		4.97	%
Junior subordinated debt	21,511			337		6.22	%	—			—		—
Total interest-bearing liabilities	2,902,842			8,504		1.16	%	2,239,821			3,760		0.67	%
Noninterest-bearing deposits	866,314							764,562
Other liabilities	59,085							40,166
Total noninterest-bearing liabilities	925,399							804,728
Total liabilities	3,828,241							3,044,549
Shareholders’ equity	547,907							397,357
Total liabilities and shareholders’ equity	$	4,376,148						$	3,441,906
Net interest spread						3.38	%						3.51	%
Effect of noninterest-bearing sources						0.31	%						0.20	%
Net interest income/margin on earning assets(4)				$	36,852	3.69	%				$	29,647	3.71	%
Tax-equivalent adjustment(4)				$	123	0.01	%				$	209	0.03	%

(1) Non-accrual loans have been included in average loan balances, but interest on non-accrual loans has not been included for purposes of determining interest income.

(2) Includes portfolio loans and leases and loans held for sale.

(3) Interest on loans and leases includes deferred fees of $453 thousand and $231 thousand for the three months ended September 30, 2018 and 2017, respectively.

(4) Tax rate used for tax-equivalent calculations is 21% for 2018 and 35% for 2017

Page 62

	For the Nine Months Ended September 30,
	2018							2017
(dollars in thousands)	Average Balance			Interest Income/ Expense		Average Rates Earned/ Paid		Average Balance			Interest Income/ Expense		Average Rates Earned/ Paid
Assets:
Interest-bearing deposits with banks	$	37,573		$	181	0.64	%	$	30,807		$	137	0.59	%
Investment securities - available for sale:
Taxable	509,405			8,523		2.24	%	391,082			5,753		1.97	%
Tax-exempt(4)	18,241			276		2.02	%	28,552			448		2.10	%
Total investment securities – available for sale	527,646			8,799		2.23	%	419,634			6,201		1.98	%
Investment securities – held to maturity	8,054			30		0.50	%	4,984			23		0.62	%
Investment securities – trading	8,248			73		1.18	%	4,105			29		0.94	%
Loans and leases(1)(2)(3)(4)	3,341,741			124,750		4.99	%	2,617,658			88,989		4.55	%
Total interest-earning assets	3,923,262			133,833		4.56	%	3,077,188			95,379		4.14	%
Cash and due from banks	8,468							15,462
Allowance for loan and lease losses	(18,386		)					(17,227		)
Other assets	418,261							265,061
Total assets	$	4,331,605						$	3,340,484
Liabilities:
Savings, NOW, and market rate accounts	$	1,719,004		$	5,977	0.46	%	$	1,374,494		$	2,392	0.23	%
Wholesale deposits	221,073			3,035		1.84	%	163,086			1,243		1.02	%
Retail time deposits	534,177			4,492		1.12	%	321,608			2,374		0.99	%
Total interest-bearing deposits	2,474,254			13,504		0.73	%	1,859,188			6,009		0.43	%
Short-term borrowings	195,483			2,711		1.85	%	110,268			811		98.00	%
Long-term FHLB advances	102,312			1,446		1.89	%	169,900			2,025		1.59	%
Subordinated notes	98,450			3,430		4.66	%	29,550			1,110		5.02	%
Junior subordinated debt	21,470			946		5.89	%	—			—		—
Total interest-bearing liabilities	2,891,969			22,037		1.02	%	2,168,906			9,955		0.61	%
Noninterest-bearing deposits	849,247							744,178
Other liabilities	53,763							37,582
Total noninterest-bearing liabilities	903,010							781,760
Total liabilities	3,794,979							2,950,666
Shareholders’ equity	536,626							389,818
Total liabilities and shareholders’ equity	$	4,331,605						$	3,340,484
Net interest spread						3.54	%						3.53	%
Effect of noninterest-bearing sources						0.27	%						0.18	%
Net interest income/margin on earning assets(4)				$	111,796	3.81	%				$	85,424	3.71	%
Tax-equivalent adjustment(4)				$	312	0.01	%				$	618	0.03	%

(1) Non-accrual loans have been included in average loan balances, but interest on non-accrual loans has not been included for purposes of determining interest income.

(2) Includes portfolio loans and leases and loans held for sale.

(3) Interest on loans and leases includes deferred fees of $1.2 million and $581 thousand for the nine months ended September 30, 2018 and 2017, respectively.

(4) Tax rate used for tax-equivalent calculations is 21% for 2018 and 35% for 2017

Page 63

Rate/Volume Analysis (tax-equivalentbasis)*

The rate/volume analysis in the table below analyzes dollar changes in the components of interest income and interest expense as they relate to the change in balances (volume) and the change in interest rates (rate) of tax-equivalent net interest income for the three and nine months ended September 30, 2018 as compared to the same period in 2017, allocated by rate and volume. The change in interest income and/or expense due to both volume and rate has been allocated to changes in volume.

	2018 Compared to 2017
(dollars in thousands)	Three Months Ended September 30,									Nine Months Ended September 30,
increase/(decrease)	Volume			Rate			Total			Volume			Rate			Total
Interest Income:
Interest-bearing deposits with banks	$	15		$	13		$	28		$	30		$	14		$	44
Investment securities - taxable	475			341			816			1,788			1,033			2,821
Investment securities -nontaxable	(49		)	(2		)	(51		)	(161		)	(11		)	(172		)
Loans and leases	8,095			3,061			11,156			24,726			11,035			35,761
Total interest income	8,536			3,413			11,949			26,383			12,071			38,454
Interest expense:
Savings, NOW and market rate accounts	202			1,400			1,602			599			2,986			3,585
Wholesale deposits	188			593			781			441			1,351			1,792
Retail time deposits	568			384			952			1,592			526			2,118
Short-term borrowings	76			473			549			626			1,274			1,900
Long-term FHLB advances	(596		)	345			(251		)	(928		)	349			(579		)
Subordinated notes	1,344			(570		)	774			2,747			(427		)	2,320
Junior subordinated debt	337			—			337			946			—			946
Total interest expense	2,119			2,625			4,744			6,023			6,059			12,082
Interest differential	$	6,417		$	788		$	7,205		$	20,360		$	6,012		$	26,372

* The tax rate used in the calculation of thetax-equivalentincome is 21% for 2018 and 35% for 2017

Tax-EquivalentNet Interest Margin

The tax-equivalent net interest margin of 3.69% for the three months ended September 30, 2018 was a two basis point decrease from 3.71% for the same period in 2017. Adjusting for the impact of the accretion of purchase accounting fair value marks, the adjusted tax-equivalent net interest margin decreased ten basis points to 3.52% from 3.62% for the three months ended September 30, 2018 and 2017, respectively. The contribution to the tax-equivalent net interest margin from the accretion of purchase accounting adjustments was 17 basis points for the three months ended September 30, 2018 as compared to nine basis points for the three months ended September 30, 2017.

The tax-equivalent net interest margin and related components for the past five consecutive quarters are shown in the table below:

Quarter	Interest- Earning Asset Yield	Interest- Bearing Liability Cost	Net Interest Spread	Effect of Noninterest Bearing Sources	Net Interest Margin
3rd Quarter 2018	4.54%	1.16%	3.38%	0.31%	3.69%
2nd Quarter 2018	4.57%	1.02%	3.55%	0.26%	3.81%
1st Quarter 2018	4.58%	0.87%	3.71%	0.23%	3.94%
4th Quarter 2017	4.15%	0.74%	3.41%	0.21%	3.62%
3rd Quarter 2017	4.18%	0.67%	3.51%	0.20%	3.71%

Page 64

Interest Rate Sensitivity 

Management actively manages the Corporation’s interest rate sensitivity position. The objectives of interest rate risk management are to control exposure of net interest income to risks associated with interest rate movements and to achieve sustainable growth in net interest income. The Corporation’s Asset Liability Committee (“ALCO”), using policies and procedures approved by the Corporation’s Board of Directors, is responsible for the management of the Corporation’s interest rate sensitivity position. The Corporation manages interest rate sensitivity by changing the mix, pricing and re-pricing characteristics of its assets and liabilities. This is accomplished through the management of the investment portfolio, the pricings of loans and deposit offerings and through wholesale funding. Wholesale funding is available from multiple sources including borrowings from the FHLB, the Federal Reserve Bank of Philadelphia’s discount window, federal funds from correspondent banks, certificates of deposit from institutional brokers, Certificate of Deposit Account Registry Service (“CDARS”), Insured Network Deposit (“IND”) Program, Charity Deposits Corporation (“CDC”) (formerly known as Institutional Deposit Corporation (“IDC”)), Insured Cash Sweep (“ICS”) and Pennsylvania Local Government Investment Trust (“PLGIT”).

Management utilizes several tools to measure the effect of interest rate risk on net interest income. These methods include gap analysis, market value of portfolio equity analysis, and net interest income simulations under various scenarios. The results of these analyses are compared to limits established by the Corporation’s ALCO policies and make adjustments as appropriate if the results are outside the established limits.

The below table demonstrates the annualized result of an interest rate simulation and the estimated effect that a parallel interest rate shift, or “shock”, in the yield curve and subjective adjustments in deposit pricing, might have on management’s projected net interest income over the next 12 months.

This simulation assumes that there is no growth in interest-earning assets or interest-bearing liabilities over the next twelve months. By definition, the simulation assumes static interest rates and does not incorporate forecasted changes in the yield curve. The changes to net interest income shown below are in compliance with the Corporation’s policy guidelines.

Summary of Interest Rate Simulation

	Change in Net Interest Income Over the Twelve Months Beginning After September 30, 2018					Change in Net Interest Income Over the Twelve Months Beginning After December 31, 2017
	Amount			Percentage		Amount			Percentage
+300 basis points	$	4,125		2.82	%	$	15,953		10.66	%
+200 basis points	$	2,839		1.94	%	$	10,644		7.11	%
+100 basis points	$	1,478		1.01	%	$	5,316		3.55	%
-100 basis points	$	(3,503	)	(2.39	)%	$	(6,913	)	(4.62	)%

The above interest rate simulation suggests that the Corporation’s balance sheet is asset sensitive as of September 30, 2018 in the +100 basis point scenario, demonstrating that a 100 basis point increase in interest rates would have a positive impact on net interest income over the next 12 months. The balance sheet is less asset sensitive in a rising-rate environment as of September 30, 2018 than it was as of December 31, 2017. The decrease in sensitivity is related to a decline in noninterest-bearing deposits and an increase in interest-bearing wholesale deposits and borrowings balances at higher rates. The improvement of the change in the 100 basis point decrease in rate is related to the Bank's ability to decrease rates on deposits should rates decline.

The interest rate simulation is an estimate based on assumptions, which are derived from past behavior of customers, along with expectations of future behavior relative to interest rate changes. In today’s economic environment and emerging from an extended period of very low interest rates, the reliability of management’s assumptions in the interest rate simulation model is more uncertain than in prior years. Actual customer behavior, as it relates to deposit activity, may be significantly different than expected behavior, which could cause an unexpected outcome and may result in lower net interest income than that derived from the analysis referenced above.

Page 65

Gap Analysis

The interest sensitivity, or gap analysis, identifies interest rate risk by showing repricing gaps in the Corporation’s balance sheet. All assets and liabilities are reflected based on behavioral sensitivity, which is usually the earliest of: repricing, maturity, contractual amortization, prepayments or likely call dates. Non-maturity deposits, such as NOW, savings and money market accounts are spread over various time periods based on the expected sensitivity of these rates considering liquidity and the investment preferences of management. Non-rate-sensitive assets and liabilities are spread over time periods to reflect management’s view of the maturity of these funds.

Non-maturity deposits (demand deposits in particular) are recognized by the Bank’s regulatory agencies to have different sensitivities to interest rate environments. Consequently, it is an accepted practice to spread non-maturity deposits over defined time periods to capture that sensitivity. Commercial demand deposits are often in the form of compensating balances, and fluctuate inversely to the level of interest rates; the maturity of these deposits is reported as having a shorter life than typical retail demand deposits. Additionally, the Bank’s regulatory agencies have suggested distribution limits for non-maturity deposits. However, management has taken a more conservative approach than these limits would suggest by forecasting these deposit types with a shorter maturity. The following table presents the Corporation’s gap analysis as of September 30, 2018:

(dollars in millions)	0 to 90 Days			91 to 365 Days			1 - 5 Years			Over 5 Years			Non-Rate Sensitive			Total
Assets:
Interest-bearing deposits with banks	$	35.2		$	—		$	—		$	—		$	—		$	35.2
Investment securities(1)	29.1			51.6			337.5			127.1			—			545.3
Loans and leases(2)	1,332.9			385.4			1,277.6			389.7			—			3,385.6
Allowance	—			—			—			—			(18.7		)	(18.7		)
Cash and due from banks	—			—			—			—			10.1			10.1
Other assets	—			—			—			—			430.9			430.9
Total assets	1,397.2			437.0			1,615.1			516.8			422.3			4,388.4
Liabilities and shareholders’ equity:
Demand, noninterest-bearing	63.0			152.5			213.4			405.5			—			834.4
Savings, NOW and market rate	112.0			335.9			796.6			432.0			—			1,676.5
Time deposits	146.3			251.6			162.3			2.4			—			562.6
Wholesale non-maturity deposits	24.1			—			—			—			—			24.1
Wholesale time deposits	81.9			177.7			—			—			—			259.6
Short-term borrowings	226.5			—			—			—			—			226.5
Long-term FHLB advances	17.5			10.7			44.6			—			—			72.8
Subordinated notes	—			—			98.5			—			—			98.5
Junior subordinated debentures	21.5			—			—			—			—			21.5
Other liabilities	—			—			—			—			60.4			60.4
Shareholders’ equity	19.7			59.1			315.1			157.6			—			551.5
Total liabilities and shareholders’ equity	712.5			987.5			1,630.5			997.5			60.4			4,388.4
Interest-earning assets	1,397.2			437.0			1,615.1			516.8			—			3,966.1
Interest-bearing liabilities	629.8			775.9			1,102.0			434.4			—			2,942.1
Difference between interest-earning assets and interest-bearing liabilities	767.4			(338.9		)	513.1			82.4			—			1,024.0
Cumulative difference between interest earning assets and interest-bearing liabilities	$	767.4		$	428.5		$	941.6		$	1,024.0		$	—		$	1,024.0
Cumulative earning assets as a % of cumulative interest-bearing liabilities	222		%	130		%	138		%	135		%

⁽¹⁾Investment securities include available for sale, held to maturity and trading.

⁽²⁾Loans include portfolio loans and leases and loans held for sale.

Page 66

The table above indicates that the Corporation is asset-sensitive in the immediate 90-day time frame and may experience an increase in net interest income during that time period if rates rise. Conversely, if rates decline, net interest income may decline. It should be noted that the gap analysis is only one tool used to measure interest rate sensitivity and should be used in conjunction with other measures such as the interest rate simulation discussed above. The gap analysis measures the timing of changes in rate, but not the true weighting of any specific component of the Corporation’s balance sheet. The asset-sensitive position reflected in this gap analysis is similar to the Corporation’s position at December 31, 2017.

PROVISION FOR LOAN AND LEASE LOSSES

For the three months ended September 30, 2018, the Corporation recorded a Provision of $664 thousand which was a $669 thousand decrease as compared to the same period in 2017. The decrease in the Provision was primarily related to improvements in qualitative factors related to the current economic environment. Net charge-offs for the third quarter of 2018 were $1.4 million as compared to $728 thousand for the same period in 2017.

For the nine months ended September 30, 2018, the Corporation recorded a Provision of $4.8 million which was a $3.3 millionincrease as compared to the same period in 2017. For the nine months ended September 30, 2018, originated loans increased by $264.9 million as compared to a $192.1 million increase for the same period in 2017. In addition, during the second quarter of 2017, an $83 thousand release from Allowance was recorded. The release from Allowance was driven by improvements in the historic charge-off rates during the lookback period used in the calculation of the Allowance requirement during the second quarter of 2017.

Asset Quality and Analysis of Credit Risk

As of September 30, 2018, total nonperforming loans and leases increased by $411 thousand to $9.0 million, representing 0.27% of portfolio loans and leases, as compared to $8.6 million, or 0.26% of portfolio loans and leases as of December 31, 2017. The increase in nonperforming loans and leases was related to the addition of $5.0 million of new nonperforming loans and leases during the nine months ended September 30, 2018, partially offset by pay-offs and pay-downs of $2.7 million, charge-offs of $653 thousand, upgrades to performing status of $1.2 million of loans and leases classified as nonperforming as of December 31, 2017. The Corporation recorded $234 thousand of loans foreclosed and transferred to OREO during the period.

As of September 30, 2018, the Allowance of $18.7 million represented 0.55% of portfolio loans and leases, an increase of 4 basis points from December 31, 2017. The Allowance on originated (non-acquired) portfolio loans, as a percentage of originated (non-acquired) portfolio loans, was 0.68% as of September 30, 2018 as compared to 0.70% as of December 31, 2017. Loans acquired in mergers are recorded at fair value as of the date of acquisition. This fair value estimate takes into account an estimate of the expected lifetime losses of the acquired loans. As such, an acquired loan will not generally become subject to additional Allowance unless it becomes impaired.

As of September 30, 2018, the Corporation had $5.5 million of troubled debt restructurings (“TDRs”), of which $4.3 million were in compliance with the modified terms and excluded from non-performing loans and leases. As of December 31, 2017, the Corporation had $9.1 million of TDRs, of which $5.8 million were in compliance with the modified terms, and were excluded from non-performing loans and leases. The decrease in TDRs during the nine months ended September 30, 2018 was primarily the result of the payoffs of two residential mortgage loans totaling $2.5 million and one $1.3 million commercial mortgage loan, all of which had been previously modified to TDRs.

As of September 30, 2018, the Corporation had a recorded investment of $12.9 million of impaired loans and leases which included $5.5 million of TDRs. Impaired loans and leases are those for which it is probable that the Corporation will not be able to collect all scheduled principal and interest in accordance with the original terms of the loans and leases. Impaired loans and leases as of December 31, 2017 totaled $14.2 million which included $9.1 million of TDRs. Refer to Note 5H in the Notes to Unaudited Consolidated Financial Statements for more information regarding the Corporation’s impaired loans and leases.

Management continues to be diligent in its credit underwriting process and proactive with its loan review process, including the engagement of the services of an independent outside loan review firm, which helps identify developing credit issues. Proactive steps that are taken include the procurement of additional collateral (preferably outside the current loan structure) whenever possible and frequent contact with the borrower. Management believes that timely identification of credit issues and appropriate actions early in the process serve to mitigate overall risk of loss.

Page 67

Nonperforming Assets and Related Ratios

(dollars in thousands)	September 30, 2018			December 31, 2017
Nonperforming Assets:
Nonperforming loans and leases	$	8,990		$	8,579
Other real estate owned	529			304
Total nonperforming assets	$	9,519		$	8,883
Troubled Debt Restructurings:
TDRs included in non-performing loans	$	1,208		$	3,289
TDRs in compliance with modified terms	4,316			5,800
Total TDRs	$	5,524		$	9,089
Loan and Lease quality indicators:
Allowance for loan and lease losses to nonperforming loans and leases	207.8		%	204.3		%
Nonperforming loans and leases to total portfolio loans and leases	0.27		%	0.26		%
Allowance for loan and lease losses to total portfolio loans and leases	0.55		%	0.53		%
Nonperforming assets to total loans and leases and OREO	0.28		%	0.27		%
Nonperforming assets to total assets	0.22		%	0.20		%
Total portfolio loans and leases	$	3,381,475		$	3,285,858
Allowance for loan and lease losses	$	18,684		$	17,525

NONINTEREST INCOME

Three Months Ended September 30, 2018 Compared to the Same Period in 2017

Noninterest income of $18.3 million for the three months ended September 30, 2018increased$2.7 million as compared to $15.6 million for the same period in 2017, primarily due to increases in other operating income and fees for wealth management services. Other operating income increased $1.8 million primarily due to a $1.2 million recovery of a purchase accounting fair value mark resulting from the pay off, in full, of a purchased credit impaired loan acquired in the RBPI merger. Fees for wealth management services increased $692 thousand primarily due to the $1.48 billion increase in wealth assets under management, administration, supervision and brokerage between September 30, 2017 and September 30, 2018.

Nine Months Ended September 30, 2018 Compared to the Same Period in 2017

Noninterest income of $57.9 million for the nine months ended September 30, 2018increased$14.3 million as compared to $43.6 million for the same period in 2017, primarily due to increases in other operating income, fees for wealth management services, insurance commissions, and capital markets revenue. Other operating income increased $6.8 million primarily due to $4.2 million of recoveries of purchase accounting fair value marks resulting from the pay offs, in full, of purchased credit impaired loans acquired in the RBPI merger and $754 thousand of recoveries of loans and leases charged-off by RBPI pre-merger. Fees for wealth management services increased $2.5 million, primarily due to the $1.48 billion increase in wealth assets under management, administration, supervision and brokerage between September 30, 2017 and September 30, 2018. Insurance commissions increased $2.3 million, primarily due to the May 2017 acquisition of Hirshorn Boothby and, to a lesser extent, the May 2018 acquisition of Domenick & Associates. Capital markets revenues increased $1.7 million primarily due to the formation of our Capital Markets group, which began operations in the second quarter of 2017.

Page 68

The following table provides supplemental information regarding mortgage loan originations and sales:

	As of and for the Three Months Ended September 30,						As of and for the Nine Months Ended September 30,
(dollars in thousands)	2018			2017			2018			2017
Mortgage originations	$	47,786		$	48,159		$	109,604		$	143,557
Mortgage loans sold:
Servicing retained	$	—		$	28,222		$	1,850		$	77,686
Servicing released	28,530			8,007			70,378			16,822
Total mortgage loans sold	$	28,530		$	36,229		$	72,228		$	94,508
Percentage of originated mortgage loans sold	59.7		%	75.2		%	65.9		%	65.8		%
Servicing retained %	—		%	77.9		%	2.6		%	82.2		%
Servicing released %	100.0		%	22.1		%	97.4		%	17.8		%
Residential mortgage loans serviced for others	$	596,162		$	647,997		$	596,162		$	647,997
Mortgage servicing rights	$	5,328		$	5,732		$	5,328		$	5,732
Gain on sale of mortgage loans	$	228		$	448		$	992		$	1,545
Loan servicing and other fees	$	559		$	548		$	1,720		$	1,570
Amortization of MSRs	$	206		$	229		$	623		$	571
(Recovery) / Impairment of MSRs	$	(23	)	$	3		$	(74	)	$	49

The following table provides details of other operating income for the three and nine months ended September 30, 2018 and 2017:

	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2018		2017		2018		2017
Visa debit card income	$	441	$	378	$	1,297	$	1,079
Bank-owned life insurance (“BOLI”) income	300		201		876		602
Commissions and fees	201		161		926		434
Safe deposit box rentals	113		98		300		282
Other investment income	62		10		209		19
Rental income	41		44		129		139
Gain on trading investments	287		155		706		473
Recovery of purchase accounting fair value loan mark	1,191		153		4,195		171
Miscellaneous other income	559		205		1,929		580
Other operating income	$	3,195	$	1,405	$	10,567	$	3,779

Wealth Assets Under Management, Administration, Supervision and Brokerage (“Wealth Assets”)

Wealth Asset accounts are categorized into two groups; the first account group consists predominantly of clients whose fees are determined based on the market value of the assets held in their accounts (“Market Value” fee basis). The second account group consists predominantly of clients whose fees are set at fixed amounts (“Fixed Fee” basis), and, as such, are not affected by market value changes.

Page 69

The following tables detail the composition of Wealth Assets as it relates to the calculation of fees for wealth management services:

(dollars in thousands)	Wealth Assets as of:
Fee Basis	September 30, 2018		June 30, 2018		March 31, 2018		December 31, 2017		September 30, 2017
Market value	$	6,032,831	$	5,779,774	$	5,693,146	$	5,884,692	$	5,759,375
Fixed fee	7,880,433		7,624,949		7,453,780		7,084,046		6,671,995
Total	$	13,913,264	$	13,404,723	$	13,146,926	$	12,968,738	$	12,431,370

	Percentage of Wealth Assets as of:
Fee Basis	September 30, 2018		June 30, 2018		March 31, 2018		December 31, 2017		September 30, 2017
Market value	43.4	%	43.1	%	43.3	%	45.4	%	46.3	%
Fixed fee	56.6	%	56.9	%	56.7	%	54.6	%	53.7	%
Total	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%

The following tables detail the composition of fees for wealth management services for the periods indicated:

(dollars in thousands)	For the Three Months Ended:
Fee Basis	September 30, 2018		June 30, 2018		March 31, 2018		December 31, 2017		September 30, 2017
Market value	$	7,841	$	7,620	$	7,880	$	7,618	$	7,522
Fixed fee	2,501		3,038		2,428		2,356		2,129
Total	$	10,342	$	10,658	$	10,308	$	9,974	$	9,651

	Percentage of Fees for Wealth Management for the Three Months Ended:
Fee Basis	September 30, 2018		June 30, 2018		March 31, 2018		December 31, 2017		September 30, 2017
Market value	75.8	%	71.5	%	76.4	%	76.4	%	77.9	%
Fixed fee	24.2	%	28.5	%	23.6	%	23.6	%	22.1	%
Total	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%

Customer Derivatives

To accommodate the risk management needs of qualified commercial customers, the Bank enters into financial derivative transactions consisting of interest rate swaps, options, risk participation agreements and foreign exchange contracts. Derivative financial instruments involve, to varying degrees, interest rate, market and credit risk. Market risk exposure from customer derivative positions is managed by simultaneously entering into matching transactions with institutional dealer counterparties that offset customer contracts in notional amount and term. Derivative contracts create counterparty credit risk with both the Bank’s customers and with institutional dealer counterparties. The Corporation manages customer counterparty credit risk through its credit policy, approval processes, monitoring procedures and by obtaining adequate collateral, when appropriate. The Bank seeks to minimize dealer counterparty credit risk by establishing credit limits and collateral agreements through industry standard agreements published by the International Swaps and Derivatives Association (ISDA) and associated credit support annex (CSA) agreements. None of the Bank’s outstanding derivative contracts associated with the customer derivative program is designated as a hedge and none is entered into for speculative purposes. Derivative instruments are recorded at fair value, with changes in fair values recognized in earnings as components of noninterest income and noninterest expense on the consolidated statements of income.

Page 70

NONINTEREST EXPENSE

Three Months Ended September 30, 2018 Compared to the Same Period in 2017

Noninterest expense for the three months ended September 30, 2018increased$5.4 million, to $33.6 million, as compared to the same period in 2017. Contributing to the increase were increases of $2.9 million, $796 thousand, $623 thousand, $344 thousand, and $232 thousand in salaries and wages, employee benefits, other operating expenses, furniture, fixtures and equipment and occupancy and bank premises expenses, respectively. A majority of these increases were related to the additional expenses associated with the staff and facilities assumed in the RBPI merger. Partially offsetting the increase in noninterest expense was a decrease of $461 thousand of due diligence, merger-related and merger integration expenses for the three months ended September 30, 2018 as compared to the same period in 2017.

Nine Months Ended September 30, 2018 Compared to the Same Period in 2017

Noninterest expense for the nine months ended September 30, 2018 increased $22.1 million, to $105.5 million, as compared to the same period in 2017. Contributing to the increase were increases of $9.1 million, $2.5 million, $1.7 million, and $1.2 million in salaries and wages, employee benefits, other operating expenses, and occupancy and bank premises expenses, respectively. A majority of these increases were related to the additional expenses associated with the staff and facilities assumed in the RBPI merger. In addition, the May 2017 acquisition of Hirshorn Boothby and the formation of our Capital Markets group in the second quarter of 2017 contributed to the increase in noninterest expense. Due diligence, merger-related and merger integration expenses increased $5.2 million for the nine months ended September 30, 2018 as compared to the same period in 2017, primarily related to the RBPI merger.

The following table provides details of other operating expenses for the three and nine months ended September 30, 2018 and 2017:

	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2018		2017		2018		2017
Contributions	$	361	$	368	$	990	$	779
Deferred compensation expense	237		222		489		590
Director fees	169		137		507		473
Dues and subscriptions	274		230		781		647
FDIC insurance	493		433		1,245		1,176
Impairment of OREO and other repossessed assets	6		—		6		200
Insurance	214		211		655		629
Loan processing	969		490		1,838		1,540
Miscellaneous other expenses	407		443		1,962		799
MSR amortization and impairment / (recovery)	184		232		550		620
Other taxes	11		21		48		34
Outsourced services	78		99		211		218
Portfolio maintenance	88		85		324		314
Postage	202		147		557		450
Stationary and supplies	128		149		391		375
Telephone and data lines	500		407		1,436		1,201
Temporary help and recruiting	82		158		239		672
Travel and entertainment	265		239		741		636
Other operating expenses	$	4,668	$	4,071	$	12,970	$	11,353

Page 71

INCOME TAXES

Although income before income taxes increased$5.2 million and $15.6 million for the three and nine months ended September 30, 2018 as compared for the same periods in 2017, income tax expense decreased $700 thousand and $1.9 million for the three and nine months ended September 30, 2018 as compared for the same periods in 2017. The effective tax rates for the three and nine months ended September 30, 2018 decreased to 19.6% and 21.0%, respectively, as compared to 30.7% and 32.9% for the same respective periods in 2017. The decreases in income tax expense and effective tax rate were primarily due to the reduction in the federal corporate income tax rate from 35% to 21% as a result of the Tax Cuts and Jobs Act (“Tax Reform”).

Income tax expense for the three and nine months ended September 30, 2018 included net discrete tax benefits of $295 thousand and $177 thousand, respectively, as compared to net discrete tax benefits of $694 thousand and $953 thousand for the same respective periods in 2017. These discrete items were the result of excess tax benefits from stock-based compensation as well as the re-measurement of deferred tax items related to Tax Reform. With the filing of the Corporation's 2017 income tax returns in the fourth quarter, we expect there will be further discrete tax benefits recorded in 2018.

BALANCE SHEET ANALYSIS

Total assets of $4.39 billion as of September 30, 2018decreased$61.3 million from $4.45 billion as of December 31, 2017. The following sections detail the changes:

Loans and Leases

The table below compares the portfolio loans and leases outstanding at September 30, 2018 to December 31, 2017:

	September 30, 2018				December 31, 2017				Change
(dollars in thousands)	Balance		Percent of Portfolio		Balance		Percent of Portfolio		Amount			Percent
Commercial mortgage	$	1,618,493	47.9	%	$	1,523,377	46.4	%	$	95,116		6.2	%
Home equity lines & loans	207,806		6.1	%	218,275		6.6	%	(10,469		)	(4.8	)%
Residential mortgage	467,402		13.8	%	458,886		14.0	%	8,516			1.9	%
Construction	178,493		5.3	%	212,454		6.5	%	(33,961		)	(16.0	)%
Commercial and industrial	722,999		21.4	%	719,312		21.9	%	3,687			0.5	%
Consumer	47,809		1.4	%	38,153		1.2	%	9,656			25.3	%
Leases	138,473		4.1	%	115,401		3.5	%	23,072			20.0	%
Total portfolio loans and leases	3,381,475		100.0	%	3,285,858		100.0	%	95,617			2.9	%
Loans held for sale	4,111				3,794				317			8.4	%
Total loans and leases	$	3,385,586			$	3,289,652			$	95,934		2.9	%

Investment Securities

Investment securities available for sale as of September 30, 2018 totaled $528.1 million, as compared to $689.2 million as of December 31, 2017. The decrease was primarily related to the maturing, in January 2018, of $200.0 million of short-term U.S. Treasury securities.

Page 72

Deposits

Deposits as of September 30, 2018 and December 31, 2017 were as follows:

	September 30, 2018				December 31, 2017				Change
(dollars in thousands)	Balance		Percent of Deposits		Balance		Percent of Deposits		Amount			Percent
Interest-bearing demand	$	578,243	17.2	%	$	481,336	14.3	%	$	96,907		20.1	%
Money market	812,027		24.2	%	862,639		25.6	%	(50,612		)	(5.9	)%
Savings	286,266		8.5	%	338,572		10.0	%	(52,306		)	(15.4	)%
Retail time deposits	561,123		16.7	%	532,202		15.8	%	28,921			5.4	%
Wholesale non-maturity deposits	24,040		0.7	%	62,276		1.8	%	(38,236		)	(61.4	)%
Wholesale time deposits	261,164		7.8	%	171,929		5.1	%	89,235			51.9	%
Interest-bearing deposits	2,522,863		75.1	%	2,448,954		72.6	%	73,909			3.0	%
Noninterest-bearing deposits	834,363		24.9	%	924,844		27.4	%	(90,481		)	(9.8	)%
Total deposits	$	3,357,226	100.0	%	$	3,373,798	100.0	%	$	(16,572	)	(0.5	)%

Borrowings

Borrowings as of September 30, 2018 and December 31, 2017 were as follows:

	September 30, 2018				December 31, 2017				Change
(dollars in thousands)	Balance		Percent of Borrowings		Balance		Percent of Borrowings		Amount			Percent
Short-term borrowings	$	226,498	54.0	%	$	237,865	47.9	%	$	(11,367	)	(4.8	)%
Long-term FHLB advances	72,841		17.4	%	139,140		28.0	%	(66,299		)	(47.6	)%
Subordinated notes	98,482		23.5	%	98,416		19.8	%	66			0.1	%
Junior subordinated debentures	21,538		5.1	%	21,416		4.3	%	122			0.6	%
Total borrowed funds	$	419,359	100.0	%	$	496,837	100.0	%	$	(77,478	)	(15.6	)%

Page 73

Capital

Consolidated shareholders' equity of the Corporation was $551.4 million, or 12.6% of total assets as of September 30, 2018, as compared to $528.1 million, or 11.9% of total assets as of December 31, 2017. The following table presents the Corporation’s and Bank’s regulatory capital ratios and the minimum capital requirements to be considered “Well Capitalized” by regulators as of September 30, 2018 and December 31, 2017:

	Actual				Minimum to be Well Capitalized
(dollars in thousands)	Amount		Ratio		Amount		Ratio
September 30, 2018
Total capital to risk weighted assets:
Corporation	$	491,062	14.33	%	$	342,754	10.00	%
Bank	$	414,306	12.10	%	$	342,460	10.00	%
Tier I capital to risk weighted assets:
Corporation	$	373,624	10.90	%	$	274,203	8.00	%
Bank	$	395,350	11.54	%	$	273,968	8.00	%
Common equity Tier I risk weighted assets:
Corporation	$	352,764	10.29	%	$	222,790	6.50	%
Bank	$	395,350	11.54	%	$	222,599	6.50	%
Tier I leverage ratio (Tier I capital to total quarterly average assets):
Corporation	$	373,624	8.95	%	$	208,814	5.00	%
Bank	$	395,350	9.48	%	$	208,596	5.00	%
Tangible common equity to tangible assets(1)
Corporation	$	343,939	8.23	%	—		—
Bank	$	388,039	9.29	%	—		—
December 31, 2017
Total capital to risk weighted assets:
Corporation	$	463,637	13.92	%	$	333,068	10.00	%
Bank	$	387,067	11.65	%	$	332,388	10.00	%
Tier I capital to risk weighted assets:
Corporation	$	347,187	10.42	%	$	266,454	8.00	%
Bank	$	369,033	11.10	%	$	265,910	8.00	%
Common equity Tier I risk weighted assets:
Corporation	$	328,676	9.87	%	$	216,494	6.50	%
Bank	$	369,033	11.10	%	$	216,052	6.50	%
Tier I leverage ratio (Tier I capital to total quarterly average assets):
Corporation	$	347,187	10.10	%	$	171,915	5.00	%
Bank	$	369,033	10.76	%	$	171,609	5.00	%
Tangible common equity to tangible assets(1)
Corporation	$	322,964	7.61	%	—		—
Bank	$	367,457	8.67	%	—		—

⁽¹⁾ There is no official regulatory guideline for the tangible common equity to tangible asset ratio.

The capital ratios for the Bank and the Corporation, as of September 30, 2018, as shown in the above tables, indicate levels above the regulatory minimum to be considered “well capitalized.” Excluding the Bank’s and Corporation’s Tier I leverage ratio, all regulatory capital ratios increased or are relatively unchanged from their December 31, 2017 levels. The Tier I leverage ratio, which is the ratio of Tier I capital to average quarterly assets, for both the Bank and Corporation decreased from December 31, 2017, as average quarterly assets for the three months ending September 30, 2018 represent a full quarter of the assets acquired in the December 15, 2017 RBPI Merger.

Page 74

Liquidity

The Corporation’s liquidity position is managed on a daily basis as part of the daily settlement function and continuously as part of the formal asset liability management process. The Bank’s liquidity is maintained by managing its core deposits as the primary source, purchasing federal funds, selling loans in the secondary market, borrowing from the FHLB and the Federal Reserve Bank, maintaining a highly liquid investment portfolio, and purchasing and issuing wholesale certificates of deposit as its secondary sources.

Unused availability is detailed on the following table:

(dollars in millions)	Available Funds as of September 30, 2018		Percent of Total Borrowing Capacity		Available Funds as of December 31, 2017		Percent of Total Borrowing Capacity		Dollar Change		Percent Change
Federal Home Loan Bank of Pittsburgh	$	1,202.6	80.4	%	$	1,020.0	74.4	%	$	182.6	17.9	%
Federal Reserve Bank of Philadelphia	139.6		100.0	%	121.3		100.0	%	18.3		15.1	%
Fed Funds Lines (seven banks)	79.0		100.0	%	79.0		100.0	%	—		—
Total	$	1,421.2	82.9	%	$	1,220.3	77.6	%	$	200.9	16.5	%

Quarterly, the ALCO reviews the Corporation’s liquidity position and reports its findings to the Corporation’s Board of Directors.

The Corporation has an agreement with IND to provide up to $40 million, excluding accrued interest, of money market and NOW funds at an agreed upon interest rate equal to the current Fed Funds rate plus 20 basis points. The Corporation had $24.0 million in balances as of September 30, 2018 under this program.

The Corporation continually evaluates the cost and mix of its retail and wholesale funding sources relative to earning assets and expected future earning-asset growth. The Corporation believes that with its current branch network, along with the available borrowing capacity at FHLB and other sources, it has sufficient capacity available to fund expected earning-asset growth.

Discussion of Segments

The Corporation has two principal segments as defined by FASB ASC 280, “Segment Reporting.” The segments are Banking and Wealth Management (see Note 22 in the accompanying Notes to Unaudited Consolidated Financial Statements).

The Wealth Management segment recorded a pre-tax segment profit (“PTSP”) of $4.1 million and $12.7 million for the three and nine months ended September 30, 2018, as compared to PTSP of $3.6 million and $10.7 million for the same periods in 2017. The Wealth Management segment provided 20.0% and 21.5% of the Corporation’s pre-tax profit for the three and nine months ended September 30, 2018, as compared to 23.3% and 24.6% for the same periods in 2017. For the three and nine month periods ended September 30, 2018, both fees for wealth management services and insurance commissions increased as compared to the same periods in 2017.

The Banking segment recorded a PTSP of $16.6 million and $46.4 million for the three and nine months ended September 30, 2018, as compared to PTSP of $11.9 million and $32.8 million for the same periods in 2017. The Banking segment provided 80.0% and 78.5% of the Corporation’s pre-tax profit for the three and nine month periods ended September 30, 2018, as compared to 76.7% and 75.4% for the same periods in 2017.

Off Balance Sheet Arrangements

The Corporation 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 include commitments to extend credit and standby letters of credit.

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the loan agreement. Total commitments to extend credit at September 30, 2018 were $764.7 million, as compared to $748.3 million at December 31, 2017.

Page 75

Standby letters of credit are conditional commitments issued by the Bank to a customer for a third party. Such standby letters of credit are issued to support private borrowing arrangements. The credit risk involved in issuing standby letters of credit is similar to that involved in granting loan facilities to customers. The Bank’s obligation under standby letters of credit at September 30, 2018 amounted to $21.2 million, as compared to $17.7 million at December 31, 2017.

Estimated fair values of the Corporation’s off-balance sheet arrangements are based on fees and rates currently charged to enter into similar loan agreements, taking into account the remaining terms of the agreements and the counterparties’ credit standing. Since fees and rates charged for off-balance sheet items are at market levels when set, there is no material difference between the stated amount and the estimated fair value of off-balance sheet arrangements.

Contractual Cash Obligations of the Corporation as of September 30, 2018:

(dollars in thousands)	Total		Within 1 Year		2 - 3 Years		4 - 5 Years		After 5 Years
Deposits without a stated maturity	$	2,534,939	$	2,534,939	$	—	$	—	$	—
Wholesale and retail time deposit	822,287		658,169		150,178		13,168		772
Short-term borrowings	226,498		226,498		—		—		—
Long-term FHLB Advances	72,841		28,106		44,735		—		—
Subordinated Notes	100,000		—		—		—		100,000
Junior subordinated debentures	25,800		—		—		—		25,800
Operating leases	31,782		5,360		9,320		6,950		10,152
Purchase obligations	4,958		3,304		1,654		—		—
Total	$	3,819,105	$	3,456,376	$	205,887	$	20,118	$	136,724

Other Information

Effects of Inflation

Inflation has some impact on the Corporation’s operating costs. Unlike many industrial companies, however, substantially all of the Corporation’s assets and liabilities are monetary in nature. As a result, interest rates have a more significant impact on the Corporation’s performance than the general level of inflation. Over short periods of time, interest rates may not necessarily move in the same direction or in the same magnitude as prices of goods and services.

Effects of Government Monetary Policies

The earnings of the Corporation are and will be affected by domestic economic conditions and the monetary and fiscal policies of the United States government and its agencies. An important function of the Federal Reserve Board is to regulate the money supply and interest rates. Among the instruments used to implement those objectives are open market operations in United States government securities and changes in reserve requirements against member bank deposits. These instruments are used in varying combinations to influence overall growth and distribution of bank loans, investments, and deposits, and their use may also affect rates charged on loans or paid for deposits. 

The Corporation is a member of the Federal Reserve System and, therefore, the policies and regulations of the Federal Reserve Board have a significant effect on its deposits, loans and investment growth, as well as the rate of interest earned and paid, and are expected to affect the Corporation’s operations in the future. The effect of such policies and regulations upon the future business and earnings of the Corporation cannot be predicted.

Special Cautionary Notice Regarding Forward Looking Statements

Certain of the statements contained in this report and the documents incorporated by reference herein may constitute forward-looking statements for the purposes of the Securities Act of 1933, as amended and the Securities Exchange Act of 1934, as amended. As such, they are only predictions and may involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements of the Bryn Mawr Bank Corporation (the “Corporation”) to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. These forward-looking statements include statements with respect to the Corporation’s financial

Page 76

goals, business plans, business prospects, credit quality, credit risk, reserve adequacy, liquidity, origination and sale of residential mortgage loans, mortgage servicing rights, the effect of changes in accounting standards, and market and pricing trends loss. The words “may,” “would,” “could,” “will,” “likely,” “expect,” “anticipate,” “intend,” “estimate,” “plan,” “forecast,” “project,” “believe,” and similar expressions are intended to identify such forward-looking statements. The Corporation’s actual results may differ materially from the results anticipated by the forward-looking statements due to a variety of factors, including without limitation:

• local, regional, national and international economic conditions, their impact on us and our customers, and our ability to assess those impacts;

• sources of liquidity and financial resources in the amounts, at the times, and on the terms required to support our future business;

• changes in policy, laws or existing statutes, regulatory guidance, legislation or judicial decisions that affect our the financial services industry as a whole, the Corporation, or our subsidiaries individually or collectively;

• results of examinations by the Federal Reserve Board of the Corporation or its subsidiaries, including the possibility that such regulator may, among other things, require us to increase our allowance for loan losses or to write down assets, or restrict our ability to: engage in new products or services; engage in future mergers or acquisitions; open new branches; pay future dividends; or otherwise take action, or refrain from taking action, in order to correct activities or practices that the Federal Reserve believes may violate applicable law or constitute an unsafe or unsound banking practice;

• effectiveness of our capital management strategies and activities;

• changes in accounting requirements or interpretations;

• the accuracy of assumptions underlying the provisions for loan and lease losses and estimates in the value of collateral, and various financial assets and liabilities;

• estimates of future reserve requirements based upon the periodic review thereof under relevant regulatory and accounting requirements;

• changes in interest rates, spreads on interest-earning assets and interest-bearing liabilities, and interest rate sensitivity;

• changes in relationships with employees, customers, and/or suppliers;

• our success in continuing to generate new business in our existing markets, as well as identifying and penetrating targeted markets and generating a profit in those markets in a reasonable time;

• changes in consumer and business spending, borrowing and savings habits, and demand for financial services in the relevant market areas;

• rapid technological developments and changes;

• technological systems failures, interruptions and security breaches could negatively impact our operations and reputation;

• competitive pressure and practices of other commercial banks, thrifts, mortgage companies, finance companies, credit unions, securities brokerage firms, insurance companies, money-market and mutual funds and other institutions operating in our market areas and elsewhere, including institutions operating locally, regionally, nationally and internationally, together with such competitors offering banking products and services by mail, telephone, computer and the internet;

• risks related to our mergers and acquisitions, including, but not limited to: reputational risks, client and customer retention risks; diversion of management time on integration-related issues; risk that integration may take longer than anticipated or cost more than expected; risk that the anticipated benefits of the merger or acquisition, including any anticipated cost savings or strategic gains, may take longer or be significantly harder to achieve or may fail to be achieved;

• our ability to contain costs and expenses;

• protection and validity of intellectual property rights;

• reliance on large customers;

• the outcome of pending and future litigation and governmental proceedings;

Page 77

• any extraordinary events (such as natural disasters, acts of terrorism, wars or political conflicts);

• ability to retain key employees and members of senior management;

• the ability of key third-party providers to perform their obligations to us and our subsidiaries;

• other material adverse changes in operations or earnings; and

• our success in managing the risks involved in the foregoing.

All written or oral forward-looking statements attributed to the Corporation are expressly qualified in their entirety by the factors, risks, and uncertainties set forth in the foregoing cautionary statements, along with those set forth under the caption titled “Risk Factors” beginning on page 12 of the 2017 Annual Report. All forward-looking statements included in this Report and the documents incorporated by reference herein are based upon the Corporation’s beliefs and assumptions as of the date of this Report. The Corporation assumes no obligation to update any forward-looking statement, whether the result of new information, future events, uncertainties or otherwise, as of any future date. In light of these risks, uncertainties and assumptions, you should not put undue reliance on any forward-looking statements discussed in this Report or incorporated documents.

ITEM 3. Quantitative and Qualitative Disclosures About Market Risks

See the discussion of quantitative and qualitative disclosures about market risks in the Corporation’s 2017 Annual Report, as updated by the disclosure in “Management’s Discussion and Analysis of Results of Operations – Interest Rate Sensitivity,” “– Summary of Interest Rate Simulation,” “Customer Derivatives” and “– Gap Analysis” in this quarterly report on Form 10-Q.

ITEM 4. Controls and Procedures

As of the end of the period covered by this report, the Corporation carried out an evaluation, under the supervision and with the participation of the Corporation’s management, including the Corporation’s Chief Executive Officer, Francis J. Leto, and Chief Financial Officer, Michael W. Harrington, of the effectiveness of the design and operation of the Corporation’s disclosure controls and procedures as defined in the Exchange Act Rules 13a-15(e) and 15d-15(e). Based upon the evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Corporation’s disclosure controls and procedures were effective as of September 30, 2018.

There were no changes in the Corporation’s internal controls over financial reporting during the last fiscal quarter that materially affected, or are reasonably likely to materially affect, the Corporation’s internal control over financial reporting.

PART II OTHER INFORMATION.

ITEM 1. Legal Proceedings.

The information required by this Item is set forth in the “Legal Matters” discussion in Note 21 “Contingencies” in the Notes to Unaudited Consolidated Financial Statements in Part I Item I of this Form 10-Q, which is incorporated herein by reference in response to this Item.

ITEM 1A. Risk Factors

None.

Page 78

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds

Share Repurchase

The following table presents the shares repurchased by the Corporation during the third quarter of 2018:

Period	Total Number of Shares Purchased(1)(2)	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(3)	Maximum Number of Shares that May Yet Be Purchased Under the Plan or Programs
July 1, 2018 – July 31, 2018	2,787	$	48.15	2,300	187,000
August 1, 2018 – August 31, 2018	21,877	$	48.72	7,269	179,731
September 1, 2018 – September 30, 2018	6,141	$	47.89	4,694	175,037
Total	30,805	$	48.51	14,263	175,037

(1) On September 30, 2018, 1,004 shares were purchased by the Corporation’s deferred compensation plans through open market transactions.

(2) Includes shares purchased to cover statutory tax withholding requirements on vested stock awards for certain officers of the Corporation or Bank as follows: 487 shares on July 2, 2018; 2,024 shares on August 11, 2018; 1,992 shares on August 12, 2018; 10,592 shares on August 15, 2018; and 443 shares on September 21, 2018.

(3) On August 6, 2015, the Corporation announced a stock repurchase program (the “2015 Program”) under which the Corporation may repurchase up to 1,200,000 shares of the Corporation’s common stock, at an aggregate purchase price not to exceed $40 million. There is no expiration date on the 2015 Program and the Corporation has no plans for an early termination of the 2015 Program. All share repurchases under the 2015 Program were accomplished in open market transactions. As of September 30, 2018, the maximum number of shares remaining authorized for repurchase under the 2015 Program was 175,037.

Page 79

ITEM 3. Defaults Upon Senior Securities

None.

ITEM 4. Mine Safety Disclosures.

Not applicable.

ITEM 5. Other Information

None.

Page 80

ITEM 6. Exhibits

Exhibit No.	Description and References
3.1	Amended and Restated By-Laws, effective November 20, 2007, incorporated by reference to Exhibit 3.2 of the Corporation’s Form 8-K filed with the SEC on November 21, 2007
3.2	Amended and Restated Articles of Incorporation, effective November 21, 2007, incorporated by reference to Exhibit 3.1 of the Corporation’s Form 8-K filed with the SEC on November 21, 2007
10.1	Third Amended and Restated Dividend Reinvestment and Stock Purchase Plan, effective May 25, 2018, incorporated by reference to the Corporation’s Prospectus (Form 424B2) filed with the SEC on May 25, 2018.
31.1	Certification of the Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith
31.2	Certification of the Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith
32.1	Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith
32.2	Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith
101.INS XBRL	Instance Document, filed herewith
101.SCH XBRL	Taxonomy Extension Schema Document, filed herewith
101.CAL XBRL	Taxonomy Extension Calculation Linkbase Document, filed herewith
101.DEF XBRL	Taxonomy Extension Definition Linkbase Document, filed herewith
101.LAB XBRL	Taxonomy Extension Label Linkbase Document, filed herewith
101.PRE XBRL	Taxonomy Extension Presentation Linkbase Document, filed herewith

Page 81

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

	BRYN MAWR BANK CORPORATION
Date: November 2, 2018	By:	/s/ Francis J. Leto
		Francis J. Leto
		President & Chief Executive Officer
		(Principal Executive Officer)
Date: November 2, 2018	By:	/s/ Michael W. Harrington
		Michael W. Harrington
		Chief Financial Officer
		(Principal Financial Officer)

Page 82

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Francis J. Leto, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Bryn Mawr Bank Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 2, 2018	/s/ Francis J. Leto
	Francis J. Leto, President & Chief Executive Officer
	(Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, Michael W. Harrington, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Bryn Mawr Bank Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 2, 2018	/s/ Michael W. Harrington
	Michael W. Harrington, Chief Financial Officer
	(Principal Financial Officer)

EX-32.1

Exhibit 32.1

Certification Pursuant to 18 U.S.C. Section 1350,

as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the quarterly report of Bryn Mawr Bank Corporation (the “Corporation”) on Form 10-Q for the quarter ended September 30, 2018, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Francis J. Leto, President and Chief Executive Officer of the Corporation, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge and belief:

(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 Corporation.

Date: November 2, 2018	/s/ Francis J. Leto
	Francis J. Leto, President & Chief Executive Officer
	(Principal Executive Officer)

EX-32.2

Exhibit 32.2

Certification Pursuant to 18 U.S.C. Section 1350,

as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the quarterly report of Bryn Mawr Bank Corporation (the “Corporation”) on Form 10-Q for the quarter ended September 30, 2018, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Michael W. Harrington, Chief Financial Officer of the Corporation, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge and belief:

(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 Corporation.

Date: November 2, 2018	/s/ Michael W. Harrington
	Michael W. Harrington, Chief Financial Officer
	(Principal Financial Officer)

XML

Document And Entity Information - shares	9 Months Ended
	Sep. 30, 2018	Nov. 01, 2018
Document And Entity Information [Abstract]
Entity Registrant Name	BRYN MAWR BANK CORP
Entity Central Index Key	0000802681
Trading Symbol	bmtc
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Document Type	10-Q
Document Period End Date	Sep. 30, 2018
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q3
Amendment Flag	false
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Common Stock, Shares Outstanding		20,250,227

XML

Consolidated Balance Sheets - Unaudited - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Assets
Cash and due from banks	$ 10,121	$ 11,657
Interest bearing deposits with banks	35,233	48,367
Cash and cash equivalents	45,354	60,024
Investment securities available for sale, at fair value (amortized cost of $543,240 and $692,824 as of September 30, 2018 and December 31, 2017, respectively)	528,064	689,202
Investment securities held to maturity, at amortized cost (fair value of $8,544 and $7,851 as of September 30, 2018 and December 31, 2017, respectively)	8,916	7,932
Investment securities, trading	8,340	4,610
Loans held for sale	4,111	3,794
Portfolio loans and leases, originated	2,752,160	2,487,296
Portfolio loans and leases, acquired	629,315	798,562
Total portfolio loans and leases	3,381,475	3,285,858
Less: Allowance for originated loan and lease losses	(18,612)	(17,475)
Less: Allowance for acquired loan and lease losses	(72)	(50)
Total allowance for loans and lease losses	(18,684)	(17,525)
Net portfolio loans and leases	3,362,791	3,268,333
Premises and equipment, net	63,281	54,458
Accrued interest receivable	13,232	14,246
Mortgage servicing rights	5,328	5,861
Bank owned life insurance	57,543	56,667
Federal Home Loan Bank stock	14,678	20,083
Goodwill	183,864	179,889
Intangible assets	24,301	25,966
Other investments	16,529	12,470
Other assets	52,110	46,185
Total assets	4,388,442	4,449,720
Deposits:
Noninterest-bearing	834,363	924,844
Interest-bearing	2,522,863	2,448,954
Total deposits	3,357,226	3,373,798
Short-term borrowings	226,498	237,865
Long-term FHLB advances	72,841	139,140
Subordinated notes	98,482	98,416
Junior subordinated debentures	21,538	21,416
Accrued interest payable	7,193	3,527
Other liabilities	53,239	47,439
Total liabilities	3,837,017	3,921,601
Shareholders' equity
Common stock, par value $1; authorized 100,000,000 shares; issued 24,532,745 and 24,360,049 shares as of September 30, 2018 and December 31, 2017, respectively and outstanding of 20,292,420 and 20,161,395 as of September 30, 2018 and December 31, 2017, respectively	24,533	24,360
Paid-in capital in excess of par value	373,205	371,486
Less: Common stock in treasury at cost - 4,240,325 and 4,198,654 shares as of September 30, 2018 and December 31, 2017, respectively	(70,437)	(68,179)
Accumulated other comprehensive loss, net of tax	(13,402)	(4,414)
Retained earnings	238,204	205,549
Total Bryn Mawr Bank Corporation shareholders' equity	552,103	528,802
Noncontrolling interest	(678)	(683)
Total shareholders' equity	551,425	528,119
Total liabilities and shareholders' equity	$ 4,388,442	$ 4,449,720

XML

Consolidated Balance Sheets - Unaudited (Parentheticals) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Statement of Financial Position [Abstract]
Investment securities available for sale, at fair value, amortized cost	$ 543,240	$ 692,824
Investment securities held to maturity at amortized cost, fair value	$ 8,544	$ 7,851
Common stock, par value (in dollars per share)	$ 1	$ 1
Common stock, authorized (in shares)	100,000,000	100,000,000
Common stock, issued (in shares)	24,532,745	24,360,049
Common stock, outstanding (in shares)	20,292,420	20,161,395
Treasury stock (in shares)	4,240,325	4,198,654

XML

Consolidated Statements of Income - Unaudited - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Interest income:
Interest and fees on loans and leases	$ 42,103	$ 30,892	$ 124,481	$ 88,517
Interest on cash and cash equivalents	64	36	181	137
Interest on investment securities:
Taxable	2,993	2,177	8,621	5,706
Non-taxable	71	91	233	302
Dividends	2	2	5	99
Total interest income	45,233	33,198	133,521	94,761
Interest expense:
Interest on deposits	5,533	2,198	13,504	6,009
Interest on short-term borrowings	1,096	547	2,711	811
Interest on FHLB advances and other borrowings	394	645	1,446	2,025
Interest on subordinated notes	1,144	370	3,430	1,110
Interest on junior subordinated debentures	337	0	946	0
Total interest expense	8,504	3,760	22,037	9,955
Net interest income	36,729	29,438	111,484	84,806
Provision for loan and lease losses	664	1,333	4,831	1,541
Net interest income after provision for loan and lease losses	36,065	28,105	106,653	83,265
Noninterest income:
Fees for wealth management services	10,343	9,651	31,309	28,761
Insurance commissions	1,754	1,373	5,349	3,079
Capital markets revenue	710	843	3,481	1,796
Service charges on deposits	726	676	2,191	1,953
Loan servicing and other fees	559	548	1,720	1,570
Net gain on sale of loans	631	799	1,677	1,948
Net gain on sale of investment securities available for sale	0	72	7	73
Net gain (loss) on sale of other real estate owned (OREO)	5	0	292	(12)
Dividends on FHLB and FRB stock	375	217	1,316	649
Other operating income	3,171	1,405	10,543	3,779
Total noninterest income	18,274	15,584	57,885	43,596
Noninterest expenses:
Salaries and wages	16,528	13,602	48,750	39,632
Employee benefits	3,356	2,560	9,941	7,453
Occupancy and bank premises	2,717	2,485	8,464	7,258
Furniture, fixtures, and equipment	2,070	1,726	6,037	5,569
Advertising	349	277	1,179	1,068
Amortization of intangible assets	891	677	2,659	2,057
Due diligence, merger-related and merger integration expenses	389	850	7,761	2,597
Professional fees	997	739	2,677	2,499
Pennsylvania bank shares tax	472	317	1,418	1,278
Information technology	1,155	880	3,602	2,575
Other operating expenses	4,668	4,071	12,970	11,353
Total noninterest expenses	33,592	28,184	105,458	83,339
Income before income taxes	20,747	15,505	59,080	43,522
Income tax expense	4,066	4,766	12,419	14,306
Net income	16,681	10,739	46,661	29,216
Net (loss) income attributable to noncontrolling interest	1	0	(5)	0
Net income attributable to Bryn Mawr Bank Corporation	$ 16,682	$ 10,739	$ 46,656	$ 29,216
Basic earnings per common share (in dollars per share)	$ 0.82	$ 0.63	$ 2.31	$ 1.72
Diluted earnings per common share (in dollars per share)	0.82	0.62	2.28	1.69
Dividends paid or accrued per share (in dollars per share)	$ 0.25	$ 0.22	$ 0.69	$ 0.64
Weighted-average basic shares outstanding	20,270,706	17,023,046	20,237,757	16,987,499
Dilutive shares	167,670	230,936	206,318	254,728
Denominator for diluted earnings per share – adjusted weighted average shares outstanding	20,438,376	17,253,982	20,444,075	17,242,227

XML

Consolidated Statements of Comprehensive Income - Unaudited - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Statement of Comprehensive Income [Abstract]
Net income attributable to Bryn Mawr Bank Corporation	$ 16,682	$ 10,739	$ 46,656	$ 29,216
Other comprehensive (loss) income:
Net unrealized (losses) gains arising during the period, net of tax (benefit) expense of $(616), $105, $(2,337), and $535, respectively	(2,319)	196	(8,792)	995
Reclassification adjustment for net (gain) on sale realized in net income, net of tax (expense) of $0, $(25), $(1), and $(25), respectively	0	(47)	(6)	(48)
Reclassification adjustment for net (gain) realized on transfer of investment securities available for sale to trading, net of tax (expense) benefit of $0, $0, $(88), and $0, respectively	0	0	(329)	0
Unrealized investment (losses) gains, net of tax (benefit) expense of $(616), $80, $(2,426), and $510, respectively	(2,319)	149	(9,127)	947
Net change in unfunded pension liability:
Change in unfunded pension liability related to unrealized loss, prior service cost and transition obligation, net of tax expense of $28, $9, $37, and $34, respectively	108	15	139	62
Total other comprehensive (loss) income	(2,211)	164	(8,988)	1,009
Total comprehensive income	$ 14,471	$ 10,903	$ 37,668	$ 30,225

XML

Consolidated Statements of Comprehensive Income - Unaudited (Parentheticals) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Statement of Comprehensive Income [Abstract]
Unrealized (losses) gains, tax (benefit) expense	$ (616)	$ 105	$ (2,337)	$ 535
Reclassification adjustment for net gain on sale realized in net income, tax (expense) benefit	0	(25)	(1)	(25)
Reclassification adjustment for net (gain) realized on transfer of investment securities available for sale to trading, tax (expense) benefit	0	0	(88)	0
Unrealized investment (losses) gains, tax (benefit) expense	(616)	80	(2,426)	510
Change in unfunded pension liability related to unrealized loss, prior service cost and transition obligation, tax expense (benefit)	$ (28)	$ 9	$ 37	$ 34

XML

Consolidated Statements of Cash Flows - Unaudited - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Operating activities:
Net income attributable to Bryn Mawr Bank Corporation	$ 46,656	$ 29,216
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan and lease losses	4,831	1,541
Depreciation of fixed assets	4,584	4,181
Net amortization of investment premiums and discounts	2,373	2,189
Net gain on sale of investment securities available for sale	(7)	(73)
Net gain on sale of loans	(1,677)	(1,948)
Stock based compensation	1,944	1,476
Amortization and net impairment of mortgage servicing rights	549	619
Net accretion of fair value adjustments	(7,023)	(2,038)
Amortization of intangible assets	2,659	2,057
Impairment of OREO and other repossessed assets	6	200
Net (gain) loss on sale of OREO	(292)	12
Net increase in cash surrender value of bank owned life insurance (BOLI)	(876)	(602)
Other, net	(7,387)	2,130
Loans originated for resale	(72,545)	(91,214)
Proceeds from loans sold	73,650	95,599
Provision for deferred income taxes	4,768	325
Change in income taxes payable/receivable, net	6,033	(2,576)
Change in accrued interest receivable	1,014	(754)
Change in accrued interest payable	3,666	(467)
Net cash provided by operating activities	62,926	39,873
Investing activities:
Purchases of investment securities available for sale	(115,381)	(200,292)
Purchases of investment securities held to maturity	(1,328)	(3,466)
Proceeds from maturity and paydowns of investment securities available for sale	259,102	259,765
Proceeds from maturity and paydowns of investment securities held to maturity	312	71
Proceeds from sale of investment securities available for sale	7	12,982
Net change in FHLB stock	5,405	1,057
Proceeds from calls of investment securities	310	22,180
Net change in other investments	(4,059)	(314)
Purchase of portfolio loans and leases	(14,974)	0
Net portfolio loan and lease originations	82,695	142,416
Purchases of premises and equipment	(13,532)	(5,251)
Acquisitions, net of cash acquired	(380)	(4,792)
Capitalize costs to OREO	(24)	(50)
Proceeds from sale of OREO	430	375
Net cash provided by (used in) investing activities	32,978	(60,302)
Financing activities:
Change in deposits	(15,542)	104,558
Change in short-term borrowings	(11,367)	(23,277)
Dividends paid	(14,208)	(11,043)
Change in long-term FHLB advances and other borrowings	(66,371)	(55,000)
Payment of contingent consideration for business combinations	(660)	(100)
Cash payments to taxing authorities on employees' behalf from shares withheld from stock-based compensation	(1,489)	(1,112)
Net proceeds from sale of treasury stock for deferred compensation plans	52
Purchase of treasury stock for deferred compensation plans		(98)
Repurchase of warrants from U.S. Treasury	(1,755)	0
Net purchase of treasury stock through publicly announced plans	(690)	0
Proceeds from exercise of stock options	1,456	1,288
Net cash (used in) provided by financing activities	(110,574)	15,216
Change in cash and cash equivalents	(14,670)	(5,213)
Cash and cash equivalents at beginning of period	60,024	50,765
Cash and cash equivalents at end of period	45,354	45,552
Supplemental cash flow information:
Income taxes	1,821	16,537
Interest	18,371	10,422
Non-cash information:
Change in other comprehensive loss	(8,988)	1,009
Change in deferred tax due to change in comprehensive income	(2,389)	544
Transfer of loans to OREO and repossessed assets	345	309
Acquisition of noncash assets and liabilities:
Assets acquired	1,466	7,284
Liabilities assumed	687	2,492
Customer Relationships
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization of intangible assets	1,271
Investing activities:
Purchase of domain name	(215)	0
Domain Name
Investing activities:
Purchase of domain name	$ 0	$ (151)

XML

Consolidated Statements of Changes in Shareholders' Equity - Unaudited - 9 months ended Sep. 30, 2018 - USD ($) $ in Thousands		Total	Common Stock	Paid-in Capital	Treasury Stock	Accumulated Other Comprehensive Loss	Retained Earnings	Noncontrolling Interest
Beginning balance (in shares) at Dec. 31, 2017		24,360,049	24,360,049
Beginning balance at Dec. 31, 2017		$ 528,119	$ 24,360	$ 371,486	$ (68,179)	$ (4,414)	$ 205,549	$ (683)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income attributable to Bryn Mawr Bank Corporation		46,656					46,656
Net income attributable to noncontrolling interest		5						5
Dividends paid or accrued, $0.69 per share		(14,099)					(14,099)
Other comprehensive loss, net of tax benefit of $2,389		(8,988)				(8,988)
Stock based compensation		1,944		1,944
Retirement of treasury stock (in shares)			(2,253)
Retirement of treasury stock		0	$ (2)	(20)	22
Net purchase of treasury stock from stock awards for statutory tax withholdings		(1,489)			(1,489)
Net treasury stock activity for deferred compensation trusts		52		153	(101)
Net purchase of treasury stock through publicly announced plans		(690)
Repurchase of warrants from U.S. Treasury		$ (1,755)		(1,853)			98
Common stock issued through share-based awards and options exercises (in shares)		63,825	172,387
Common stock issued through share-based awards and options exercises		$ 1,557	$ 172	1,385
Shares issued in acquisitions (in shares)	[1]		2,562
Shares issued in acquisitions	[1]	$ 113	$ 3	110
Ending balance (in shares) at Sep. 30, 2018		24,532,745	24,532,745
Ending balance at Sep. 30, 2018		$ 551,425	$ 24,533	$ 373,205	$ (70,437)	$ (13,402)	$ 238,204	$ (678)

[1] Shares relating to the RBPI Merger (defined in Note 3 – Business Combinations below) recorded in April 2018.

XML

Consolidated Statements of Changes in Shareholders' Equity - Unaudited (Parentheticals) $ in Thousands	9 Months Ended
	Sep. 30, 2018 USD ($) $ / shares
Dividends paid or accrued per share (in dollars per share)	$ 0.69
Retained Earnings
Dividends paid or accrued per share (in dollars per share)	$ 0.69
Accumulated Other Comprehensive Loss
Other comprehensive loss, tax expense | $	$ 2,389

XML

Basis of Presentation

9 Months Ended

Sep. 30, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

Basis of Presentation

The Unaudited Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). In the opinion of Bryn Mawr Bank Corporation’s (the “Corporation”) management, all adjustments necessary for a fair presentation of the consolidated financial position and the results of operations for the interim periods presented have been included. These Unaudited Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and notes thereto in the Corporation’s Annual Report on Form 10-K for the twelve months ended December 31, 2017 (the “2017 Annual Report”).

The results of operations for the three and nine months ended September 30, 2018 are not necessarily indicative of the results to be expected for the full year.

Principles of Consolidation

The Unaudited Consolidated Financial Statements include the accounts of the Corporation and its wholly owned subsidiaries; the Corporation’s primary subsidiary is The Bryn Mawr Trust Company (the “Bank”). In connection with the RBPI Merger (defined in Note 3 – Business Combinations below), the Corporation acquired two Delaware trusts, Royal Bancshares Capital Trust I and Royal Bancshares Capital Trust II. These two entities are not consolidated per requirements under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 810, “Consolidation” (“ASC Topic 810”). All significant intercompany balances and transactions have been eliminated in consolidation. Certain prior period amounts have been reclassified to conform to the current-year presentation.

XML

Recent Accounting Pronouncements

9 Months Ended

Sep. 30, 2018

Accounting Policies [Abstract]

Recent Accounting Pronouncements

Recent Accounting Pronouncements

The following FASB Accounting Standards Updates ("ASUs") are divided into pronouncements which have been adopted by the Corporation since January 1, 2018, and those which are not yet effective and have been evaluated or are currently being evaluated by management as of September 30, 2018.

Adopted Pronouncements:

FASB ASU 2014-9 (Topic 606), “Revenue from Contracts with Customers”

The Corporation adopted ASU 2014-9 Revenue from Contracts with Customers and all subsequent amendments to the ASU (collectively, “ASC 606”), which (i) creates a single framework for recognizing revenue from contracts with customers that fall within its scope and (ii) revises when it is appropriate to recognize a gain (loss) from the transfer of nonfinancial assets, such as OREO. The majority of the Corporation’s revenues come from interest income and other sources, including loans, leases, investment securities and derivatives, that are outside the scope of ASC 606. The Corporation’s services that fall within the scope of ASC 606 are presented within noninterest income and are recognized as revenue as the Corporation satisfies its obligation to the customer. Services within the scope of ASC 606 include service charges on deposits, Visa debit card income, wealth management fees, investment brokerage fees, and the net gain on sale of OREO. Refer to Note 17 Revenuefrom Contracts with Customers for further discussion on the Corporation’s accounting policies for revenue sources within the scope of ASC 606. The adoption of this ASU did not have an impact to our Consolidated Financial Statements and related disclosures.

FASB ASU 2017-1 (Topic 805), “Business Combinations”

The Corporation adopted ASU 2017-1, which clarifies the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The adoption of this ASU did not have a material impact on our Consolidated Financial Statements and related disclosures.

FASB ASU 2016-15 (Topic 320), “Classification of Certain Cash Receipts and Cash Payments”

The Corporation adopted ASU 2016-15, which provides guidance on eight specific cash flow issues and their disclosure in the consolidated statements of cash flows. The issues addressed include debt prepayment, settlement of zero-coupon debt, contingent consideration in business combinations, proceeds from settlement of insurance claims, proceeds from settlement of BOLI, distributions received from equity method investees, beneficial interests in securitization transactions, and separately identifiable cash flows and application of the predominance principle. The adoption of this ASU did not have a material impact on our Consolidated Financial Statements and related disclosures.

FASB ASU 2016-1 (Subtopic 825-10), “Financial Instruments – Overall, Recognition and Measurement of Financial Assets and Financial Liabilities”

The Corporation adopted ASU 2016-1 which requires that equity investments be measured at fair value with changes in fair value recognized in net income. The Corporation’s equity investments with a readily determinable fair value are currently included within trading securities and are measured at fair value with changes in fair value recognized in net income. In connection with the adoption of this ASU, the Corporation elected the practicability exception to fair value measurement for investments in equity securities without a readily determinable fair value (other than our Federal Home Loan Bank (“FHLB”), Federal Reserve Bank ("FRB"), and Atlantic Central Bankers Bank stock, which are outside of the scope of this ASU). Under the practicability exception, the investments are measured at cost, less impairment, plus or minus observable price changes (in orderly transactions) of an identical or similar investment of the same issuer. The adoption of this ASU did not have a material impact on our Consolidated Financial Statements and related disclosures.

FASB ASU 2017-7 (Topic 715), “Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost”

On January 1, 2018, the Corporation adopted ASU 2017-7 and all subsequent amendments to the ASU, which requires that an employer report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations, if one is presented. If a separate line item or items are used to present the other components of net benefit cost, that line item or items must be appropriately described. If a separate line item or items are not used, the line item or items used in the income statement to present the other components of net benefit cost must be disclosed. The amendments in this update also allow only the service cost component to be eligible for capitalization when applicable (for example, as a cost of internally manufactured inventory or a self-constructed asset).

Upon adoption, the components of net periodic benefit cost other than the service cost component were reclassified retrospectively from “Employee benefits” to “Other operating expenses” in the Consolidated Statements of Income. Since both “Employee benefits” and “Other operating expenses” line items are under “Noninterest expenses”, there was no impact to total “Noninterest expenses” or “Net income.” The components of net periodic benefit cost are currently disclosed in Note 17 – “Pension and Postretirement Benefit Plans” in the Notes to Consolidated Financial Statements found in our 2017 Annual Report. Additionally, the Corporation does not currently capitalize any components of its net periodic benefit costs. The adoption of this ASU did not have a material impact on our Consolidated Financial Statements and related disclosures.

Pronouncements Not Yet Effective:

FASB ASU 2018-07, “Improvements to Nonemployee Share-Based Payment Accounting”

Issued in June 2018, ASU 2018-07: Compensation - Stock Compensation (Topic 718), “Improvements to Nonemployee Share-Based Payment Accounting” expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. An entity should apply the requirements of Topic 718 to nonemployee awards except for specific guidance on inputs to an option pricing model and the attribution of cost (that is, the period of time over which share-based payment awards vest and the pattern of cost recognition over that period). The amendments specify that Topic 718 applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in a grantor’s own operations by issuing share-based payment awards. The amendments also clarify that Topic 718 does not apply to share-based payments used to effectively provide (1) financing to the issuer or (2) awards granted in conjunction with selling goods or services to customers as part of a contract accounted for under Topic 606, Revenue from Contracts with Customers. The amendments in this update are effective for public business entities for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. The Corporation has not historically granted share based payment awards to nonemployees other than to the Corporation’s Board of Directors, who are treated as employees for share-based payment accounting. As a result, management does not expect the adoption of this ASU to have an impact on our Consolidated Financial Statements and related disclosures.

FASB ASU 2017-4 (Topic 350), “Intangibles – Goodwill and Others”

Issued in January 2017, ASU 2017-4 simplifies how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. Step 2 measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. ASU 2017-4 is effective for annual periods beginning after December 15, 2019 including interim periods within those periods. Management does not expect the adoption of this ASU to have a material impact on our Consolidated Financial Statements and related disclosures.

FASB ASU 2016-13 (Topic 326), “Measurement of Credit Losses on Financial Instruments”

Issued in June 2016, ASU 2016-13 significantly changes how companies measure and recognize credit impairment for many financial assets. The new current expected credit loss (“CECL”) model will require companies to immediately recognize an estimate of credit losses expected to occur over the remaining life of the financial assets that are in the scope of the standard. The ASU also makes targeted amendments to the current impairment model for available-for-sale debt securities. ASU 2016-13 is effective for the annual and interim periods in fiscal years beginning after December 15, 2019, with early adoption permitted. Adoption of this new guidance can be applied only on a prospective basis as a cumulative-effect adjustment to retained earnings.

It is expected that the new model will include different assumptions used in calculating credit losses, such as estimating losses over the estimated life of a financial asset, and will consider expected future changes in macroeconomic conditions. The adoption of this ASU may result in an increase to the Corporation’s allowance for credit losses, which will depend upon the nature and characteristics of the Corporation 's portfolio at the adoption date, as well as the macroeconomic conditions and forecasts at the adoption date. The Corporation has engaged the services of a third-party consultant as well as invested in software designed to assist management in the development and implementation of the new CECL model. Management has validated historical data uploaded within the third-party software and is beginning to develop the CECL model, including evaluating key assumptions such as portfolio segmentation, life of loan assumptions, and financial forecasts. The adoption of this ASU will also require the addition of an allowance for held-to-maturity debt securities. The Corporation currently does not intend to early adopt this new guidance.

FASB ASU 2016-2 (Topic 842), “Leases”

Issued in February 2016, ASU 2016-2 revises the accounting related to lessee accounting. Under the new guidance, lessees will be required to recognize a lease liability and right-of-use asset for all leases. The new lease guidance also simplifies the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and lease liabilities. ASU 2016-2 is effective for the first interim period within annual periods beginning after December 15, 2018, with early adoption permitted. The standard is required to be adopted using the modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. Management is in-process of migrating data and key assumptions into a third-party lease accounting software to calculate the lease liability and right-of-use asset for all existing leases of the Corporation. Management is aware that the adoption of this ASU will impact the Corporation’s balance sheet for the recording of assets and liabilities for operating leases. Any additional assets recorded as a result of implementation will have a negative impact on the Corporation and Bank capital ratios under current regulatory guidance.

FASB ASU 2018-12 (Topic 944), “Targeted Improvements to the Accounting for Long-Duration Contracts”

Issued in August 2018, ASU 2018-12 makes targeted improvements to the existing recognition, measurement, presentation, and disclosure requirements for long-duration contracts issued by an insurance entity. Specifically, the ASU is intended to 1) improve the timeliness of recognizing changes in the liability for future policy benefits and modify the rate used to discount future cash flows, 2) simplify and improve the accounting for certain market-based options or guarantees associated with deposit (or account balance) contracts, 3) simplify the amortization of deferred acquisition costs, and 4) improve the effectiveness of the required disclosures. ASU 2018-12 is effective for public business entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early application of the amendments is permitted. As an independent insurance agent, the Corporation does not issue insurance contracts. As a result, management does not expect the adoption of this ASU to have an impact on our Consolidated Financial Statements and related disclosures.

XML

Business Combinations

9 Months Ended

Sep. 30, 2018

Business Combinations [Abstract]

Business Combinations

Business Combinations

Domenick & Associates (“Domenick”)

The Bank’s subsidiary, BMT Insurance Advisors, Inc., completed the acquisition of Domenick, a full-service insurance agency established in 1993 and headquartered in the Old City section of Philadelphia, on May 1, 2018. The consideration paid was $1.5 million, of which $750 thousand was paid at closing, with three contingent cash payments, not to exceed $250 thousand each, to be payable on each of May 1, 2019, May 1, 2020, and May 1, 2021, subject to the attainment of certain targets during the related periods.

The following table details the consideration paid, the initial estimated fair value of identifiable assets acquired and liabilities assumed as of the date of acquisition and the resulting goodwill recorded:

(dollars in thousands)
Consideration paid:
Cash paid at closing	$	750
Contingent payment liability (present value)	706
Value of consideration	$	1,456
Assets acquired:
Cash and due from banks	370
Intangible assets - customer relationships	779
Premises and equipment	1
Other assets	316
Total assets	1,466
Liabilities assumed:
Accounts payable	657
Other liabilities	30
Total liabilities	$	687
Net assets acquired	$	779
Goodwill resulting from acquisition of Domenick	$	677

As of June 30, 2018, the estimates of the fair value of identifiable assets acquired and liabilities assumed in the Domenick acquisition were final.

Royal Bancshares of Pennsylvania, Inc.

On December 15, 2017, the previously announced merger of Royal Bancshares of Pennsylvania, Inc. (“RBPI”) with and into the Corporation (the “Effective Date”), and the merger of Royal Bank America with and into the Bank (collectively, the "RBPI Merger"), as contemplated by the Agreement and Plan of Merger, by and between RBPI and the Corporation, dated as of January 30, 2017 (the “Agreement”) was completed. In accordance with the Agreement, the aggregate share consideration paid to RBPI shareholders consisted of 3,101,316 shares of the Corporation’s common stock. Shareholders of RBPI received 0.1025 shares of Corporation common stock for each share of RBPI Class A common stock and 0.1179 shares of Corporation common stock for each share of RBPI Class B common stock owned as of the Effective Date of the RBPI Merger, with cash-in-lieu of fractional shares totaling $7 thousand. Holders of in-the-money options to purchase RBPI Class A common stock received cash totaling $112 thousand. In addition, 1,368,040 warrants to purchase Class A common stock of RBPI, valued at $1.9 million were converted to 140,224 warrants to purchase Corporation common stock. In accordance with the acquisition method of accounting, assets acquired and liabilities assumed were preliminarily adjusted to their fair values as of the Effective Date. The excess of consideration paid above the fair value of net assets acquired was recorded as goodwill. This goodwill is not amortizable nor is it deductible for income tax purposes.

In connection with the RBPI Merger, the consideration paid and the estimated fair value of identifiable assets acquired and liabilities assumed as of the Effective Date, which include the effects of any measurement period adjustments in accordance with ASC 805-10, are summarized in the following table:

(dollars in thousands)
Consideration paid:
Common shares issued (3,101,316)	$	136,768
Cash in lieu of fractional shares	7
Cash-out of certain options	112
Fair value of warrants assumed	1,853
Value of consideration	$	138,740
Assets acquired:
Cash and due from banks	17,092
Investment securities available for sale	121,587
Loans	566,228
Premises and equipment	8,264
Deferred income taxes	34,586
Bank-owned life insurance	16,550
Core deposit intangible	4,670
Favorable lease asset	566
Other assets	13,996
Total assets	$	783,539
Liabilities assumed:
Deposits	593,172
FHLB and other long-term borrowings	59,568
Short-term borrowings	15,000
Junior subordinated debentures	21,416
Unfavorable lease liability	322
Other liabilities	31,381
Total liabilities	$	720,859
Net assets acquired	$	62,680
Goodwill resulting from acquisition of RBPI	$	76,060

Provisional Estimates of Fair Value of Certain Assets Acquired in the RBPI Merger

As of September 30, 2018, the accounting for the estimates of fair value for certain loans acquired in the RBPI Merger is incomplete. The Corporation is in the process of obtaining new information that will allow management to better estimate fair values that existed as of the Effective Date. When this information is obtained, management anticipates an adjustment to the provisional fair value assigned to certain acquired loans. These adjustments will result in corresponding adjustments to goodwill and net deferred tax asset. In accordance with ASC 805-10, the adjustments will be recorded in the period in which the new information about facts and circumstances that existed as of the Effective Date is obtained and reviewed.

During the nine months ended September 30, 2018, the Corporation adjusted certain provisional fair value estimates related to the RBPI Merger. The following table details the changes in fair value of the net assets acquired and liabilities assumed as of the Effective Date from the amounts originally reported in the 2017 Annual Report:

(dollars in thousands)
Goodwill resulting from the acquisition of RBPI reported as of December 31, 2017	$	72,762
Value of Consideration Adjustment:
Common shares issued (2,562)	113
Fair Value Adjustments:
Loans	4,145
Other assets	491
Deferred income taxes	(1,451		)
Total Fair Value Adjustments	3,185
Goodwill from the acquisition of RBPI as of September 30, 2018	$	76,060

Methods Used to Fair Value Assets and Liabilities

For information regarding the valuation methodologies used to estimate the fair values of major categories of assets acquired and liabilities assumed, refer to Note 2 in the Notes to Consolidated Financial Statements in the 2017 Annual Report.

Loans Held for Investment

During the first and third quarters of 2018, new information became available related to certain loans acquired from RBPI which resulted in an adjustment to the fair value mark applied to acquired loans with evidence of credit quality deterioration. Loans meeting this definition were reviewed by comparing the contractual cash flows to expected collectible cash flows. The aggregate expected cash flows less the acquisition date fair value results in an accretable yield amount. The accretable yield amount will be recognized over the life of the loans or over the recovery period of the underlying collateral on a level yield basis as an adjustment to yield. As a result of the adjustments, the Corporation recorded increases of $3.0 million and $1.6 million in nonaccretable difference in the first and third quarters of 2018, respectively. The adjustment to the aggregate expected cash flows less the Effective Date fair value resulted in an increase in accretable yield of $325 thousand. There were no adjustments to the fair value mark applied to the acquired loan portfolio during the second quarter of 2018.

The following table provides an updated summary of the acquired impaired loans and leases as of the Effective Date, which include the effects of any measurement period adjustments in accordance with ASC 805-10, resulting from the RBPI Merger:

(dollars in thousands)
Contractually required principal and interest payments	$	40,741
Contractual cash flows not expected to be collected (nonaccretable difference)	(17,637		)
Cash flows expected to be collected	23,104
Interest component of expected cash flows (accretable yield)	(2,644		)
Fair value of loans acquired with deterioration of credit quality	$	20,460

Harry R. Hirshorn & Company, Inc., d/b/a Hirshorn Boothby (“Hirshorn”)

The acquisition of Hirshorn, an insurance agency headquartered in the Chestnut Hill section of Philadelphia, was completed on May 24, 2017. Immediately after the acquisition, Hirshorn was merged into the Bank’s existing insurance subsidiary, BMT Insurance Advisors, Inc., formerly known as Powers Craft Parker and Beard, Inc. The consideration paid by the Bank was $7.5 million, of which $5.8 million was paid at closing, one contingent cash payment of $575 thousand was paid during the second quarter of 2018, and two contingent cash payments, not to exceed $575 thousand each, to be payable on each of May 24, 2019 and May 24, 2020, subject to the attainment of certain targets during the related periods. The acquisition enhanced the Bank’s ability to offer comprehensive insurance solutions to both individual and business clients and continues the strategy of selectively establishing specialty offices in targeted areas.

In connection with the Hirshorn acquisition, the following table details the consideration paid, the initial estimated fair value of identifiable assets acquired and liabilities assumed as of the date of acquisition and the resulting goodwill recorded:

(dollars in thousands)
Consideration paid:
Cash paid at closing	$	5,770
Contingent payment liability (present value)	1,690
Value of consideration	7,460
Assets acquired:
Cash operating accounts	978
Intangible assets – trade name	195
Intangible assets – customer relationships	2,672
Intangible assets – non-competition agreements	41
Premises and equipment	1,795
Accounts receivable	192
Other assets	27
Total assets	5,900
Liabilities assumed:
Accounts payable	800
Other liabilities	2
Total liabilities	802
Net assets acquired	5,098
Goodwill resulting from acquisition of Hirshorn	$	2,362

As of December 31, 2017, the estimates of the fair value of identifiable assets acquired and liabilities assumed in the Hirshorn acquisition were final.

Pro Forma Income Statements (unaudited)

The following table presents the pro forma income statement of the combined institution (RBPI and the Corporation) for the three and nine months ended September 30, 2017 as if the RBPI Merger had occurred on January 1, 2017. The pro forma income statement adjustments are limited to the effects of purchase accounting fair value mark amortization and accretion and intangible asset amortization. No cost savings or additional merger expenses have been included in the pro forma income statement. Due to the immaterial contribution to net income of the Hirshorn acquisition, which occurred during the year shown in the table, the pro forma effects of the Hirshorn acquisition have been excluded.

(dollars in thousands)	Three Months Ended September 30, 2017		Nine Months Ended September 30, 2017
Total interest income	$	43,412	$	126,976
Total interest expense	5,480		15,013
Net interest income	37,932		111,963
Provision for loan and lease losses	1,492		2,054
Net interest income after provision for loan and lease losses	36,440		109,909
Total noninterest income	16,015		45,481
Total noninterest expenses*	33,364		99,699
Income before income taxes	19,091		55,691
Income tax expense	5,843		18,306
Net income	$	13,248	$	37,385
Per share data**:
Weighted-average basic shares outstanding	20,121,800		20,086,253
Dilutive shares	261,935		284,294
Adjusted weighted-average diluted shares	20,383,735		20,370,547
Basic earnings per common share	$	0.66	$	1.86
Diluted earnings per common share	$	0.65	$	1.84

*Total noninterest expense includes RBPI Net Income Attributable to Noncontrolling Interest and Preferred Stock Series A Accumulated Dividend and Accretion for pro forma presentation.

**Assumes that the shares of RBPI common stock outstanding as of December 31, 2017 were outstanding for the full three and nine month periods ended September 30, 2017.

Due Diligence, Merger-Related and Merger Integration Expenses

Due diligence, merger-related and merger integration expenses include consultant costs, investment banker fees, contract breakage fees, retention bonuses for severed employees, salary and wages for redundant staffing involved in the integration of the institutions and bonus accruals for members of the merger integration team. The following table details the costs identified and classified as due diligence, merger-related and merger integration costs for the periods indicated:

	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2018		2017		2018		2017
Advertising	$	—	$	89	$	61	$	108
Employee Benefits	—		5		271		10
Occupancy and bank premises	—		—		2,145		—
Furniture, fixtures, and equipment	—		31		365		37
Information technology	167		41		421		300
Professional fees	193		632		1,450		1,570
Salaries and wages	29		28		852		428
Other	—		24		2,196		144
Total due diligence, merger-related and merger integration expenses	$	389	$	850	$	7,761	$	2,597

XML

Investment Securities

9 Months Ended

Sep. 30, 2018

Investments, Debt and Equity Securities [Abstract]

Investment Securities

Investment Securities

The amortized cost and fair value of investment securities available for sale as of September 30, 2018 and December 31, 2017 are as follows:

As of September 30, 2018

(dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U.S. Treasury securities	$	100	$	—	$	—		$	100
Obligations of the U.S. government and agencies	196,334		17		(5,898		)	190,453
Obligations of state and political subdivisions	15,890		1		(92		)	15,799
Mortgage-backed securities	292,005		344		(7,928		)	284,421
Collateralized mortgage obligations	37,811		—		(1,618		)	36,193
Other investment securities	1,100		—		(2		)	1,098
Total	$	543,240	$	362	$	(15,538	)	$	528,064

As of December 31, 2017

(dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U.S. Treasury securities	$	200,077	$	11	$	—		$	200,088
Obligations of the U.S. government and agencies	153,028		75		(2,059		)	151,044
Obligations of state and political subdivisions	21,352		11		(53		)	21,310
Mortgage-backed securities	275,958		887		(1,855		)	274,990
Collateralized mortgage obligations	37,596		14		(948		)	36,662
Other investment securities	4,813		318		(23		)	5,108
Total	$	692,824	$	1,316	$	(4,938	)	$	689,202

The following tables present the aggregate amount of gross unrealized losses as of September 30, 2018 and December 31, 2017 on available for sale investment securities classified according to the amount of time those securities have been in a continuous unrealized loss position:

As of September 30, 2018

	Less than 12 Months					12 Months or Longer					Total
(dollars in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Obligations of the U.S. government and agencies	$	82,187	$	(1,634	)	$	107,601	$	(4,264	)	$	189,788	$	(5,898	)
Obligations of state and political subdivisions	11,009		(21		)	2,303		(71		)	13,312		(92		)
Mortgage-backed securities	136,170		(3,037		)	130,269		(4,891		)	266,439		(7,928		)
Collateralized mortgage obligations	10,939		(86		)	24,945		(1,532		)	35,884		(1,618		)
Other investment securities	549		(1		)	249		(1		)	798		(2		)
Total	$	240,854	$	(4,779	)	$	265,367	$	(10,759	)	$	506,221	$	(15,538	)

As of December 31, 2017

	Less than 12 Months					12 Months or Longer					Total
(dollars in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Obligations of the U.S. government and agencies	$	114,120	$	(1,294	)	$	26,726	$	(765	)	$	140,846	$	(2,059	)
Obligations of state and political subdivisions	11,144		(29		)	2,709		(24		)	13,853		(53		)
Mortgage-backed securities	177,919		(1,293		)	31,787		(562		)	209,706		(1,855		)
Collateralized mortgage obligations	5,166		(47		)	26,686		(901		)	31,852		(948		)
Other investment securities	1,805		(23		)	—		—			1,805		(23		)
Total	$	310,154	$	(2,686	)	$	87,908	$	(2,252	)	$	398,062	$	(4,938	)

Management evaluates the Corporation’s investment securities that are in an unrealized loss position in order to determine if the decline in fair value is other than temporary. The investment portfolio includes debt securities issued by U.S. government agencies, U.S. government-sponsored agencies, state and local municipalities and other issuers. All fixed income investment securities in the Corporation’s investment portfolio are rated as investment-grade or higher. Factors considered in the evaluation include the current economic climate, the length of time and the extent to which the fair value has been below cost, interest rates and the bond rating of each security. The unrealized losses presented in the tables above are temporary in nature and are primarily related to market interest rates rather than the underlying credit quality of the issuers or collateral. Management does not believe that these unrealized losses are other-than-temporary. Management does not have the intent to sell these securities prior to their maturity or the recovery of their cost bases and believes that it is more likely than not that it will not have to sell these securities prior to their maturity or the recovery of their cost bases.

As of September 30, 2018 and December 31, 2017, securities having a fair value of $121.1 million and $126.2 million, respectively, were specifically pledged as collateral for public funds, trust deposits, the FRB discount window program, FHLB borrowings and other purposes. Advances by the FHLB are collateralized by a blanket lien on non-pledged, mortgage-related loans as part of the Corporation’s borrowing agreement with the FHLB as well as certain securities individually pledged by the Corporation.

The amortized cost and fair value of available for sale investment and mortgage-related securities available for sale as of September 30, 2018 and December 31, 2017, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities as borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

	September 30, 2018				December 31, 2017
(dollars in thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Investment securities:
Due in one year or less	$	12,265	$	12,237	$	211,019	$	211,019
Due after one year through five years	176,700		171,374		126,452		124,797
Due after five years through ten years	24,459		23,839		23,147		22,804
Due after ten years	—		—		15,439		15,421
Subtotal	213,424		207,450		376,057		374,041
Mortgage-related securities(1)	329,816		320,614		313,554		311,652
Mutual funds with no stated maturity	—		—		3,213		3,509
Total	$	543,240	$	528,064	$	692,824	$	689,202

(1) Expected maturities of mortgage-related securities may differ from contractual maturities as borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

The amortized cost and fair value of investment securities held to maturity as of September 30, 2018 and December 31, 2017 are as follows:

As of September 30, 2018

(dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Mortgage-backed securities	$	8,916	$	—	$	(372	)	$	8,544

As of December 31, 2017

(dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Mortgage-backed securities	$	7,932	$	5	$	(86	)	$	7,851

The following tables present the aggregate amount of gross unrealized losses as of September 30, 2018 and December 31, 2017 on held to maturity securities classified according to the amount of time those securities have been in a continuous unrealized loss position:

As of September 30, 2018

	Less than 12 Months					12 Months or Longer					Total
(dollars in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Mortgage-backed securities	$	3,882	$	(132	)	$	4,662	$	(240	)	$	8,544	$	(372	)

As of December 31, 2017

	Less than 12 Months					12 Months or Longer					Total
(dollars in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Mortgage-backed securities	$	2,756	$	(25	)	$	3,866	$	(61	)	$	6,622	$	(86	)

The amortized cost and fair value of held to maturity investment securities as of September 30, 2018 and December 31, 2017, by contractual maturity, are shown below:

	September 30, 2018				December 31, 2017
(dollars in thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Mortgage-backed securities(1)	$	8,916	$	8,544	$	7,932	$	7,851

(1) Expected maturities of mortgage-related securities may differ from contractual maturities as borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

As of September 30, 2018 and December 31, 2017, the Corporation’s investment securities held in trading accounts totaled $8.3 million and $4.6 million, respectively, and primarily consist of deferred compensation trust accounts which are invested in listed mutual funds whose diversification is at the discretion of the deferred compensation plan participants and a rabbi trust account established to fund certain unqualified pension obligations. During the first quarter of 2018, $3.2 million of investment securities included within the rabbi trust account were reclassified from available for sale to trading. Investment securities held in trading accounts are reported at fair value, with adjustments in fair value reported through income.

XML

Loans and Leases

9 Months Ended

Sep. 30, 2018

Receivables [Abstract]

Loans and Leases

Loans and Leases

The loan and lease portfolio consists of loans and leases originated by the Corporation, as well as loans acquired in mergers and acquisitions. These mergers and acquisitions include the December 2017 RBPI Merger, the January 2015 Continental Bank Holdings, Inc. Merger, the November 2012 transaction with First Bank of Delaware, and the July 2010 acquisition of First Keystone Financial, Inc. Certain tables in this footnote are presented with a breakdown between originated and acquired loans and leases.

A. The table below detailsportfolio loans and leases as of the dates indicated:

	September 30, 2018						December 31, 2017
(dollars in thousands)	Originated		Acquired		Total Loans and Leases		Originated		Acquired		Total Loans and Leases
Loans held for sale	$	4,111	$	—	$	4,111	$	3,794	$	—	$	3,794
Real Estate Loans:
Commercial mortgage	$	1,259,397	$	359,096	$	1,618,493	$	1,122,327	$	401,050	$	1,523,377
Home equity lines and loans	180,068		27,738		207,806		183,283		34,992		218,275
Residential mortgage	381,037		86,365		467,402		360,935		97,951		458,886
Construction	158,691		19,802		178,493		128,266		84,188		212,454
Total real estate loans	$	1,979,193	$	493,001	$	2,472,194	$	1,794,811	$	618,181	$	2,412,992
Commercial and industrial	618,200		104,799		722,999		589,304		130,008		719,312
Consumer	44,833		2,976		47,809		35,146		3,007		38,153
Leases	109,934		28,539		138,473		68,035		47,366		115,401
Total portfolio loans and leases	$	2,752,160	$	629,315	$	3,381,475	$	2,487,296	$	798,562	$	3,285,858
Total loans and leases	$	2,756,271	$	629,315	$	3,385,586	$	2,491,090	$	798,562	$	3,289,652
Loans with fixed rates	$	1,167,097	$	375,326	$	1,542,423	$	1,034,542	$	538,510	$	1,573,052
Loans with adjustable or floating rates	1,589,174		253,989		1,843,163		1,456,548		260,052		1,716,600
Total loans and leases	$	2,756,271	$	629,315	$	3,385,586	$	2,491,090	$	798,562	$	3,289,652
Net deferred loan origination fees included in the above loan table	$	1,220	$	—	$	1,220	$	887	$	—	$	887

B. Components of the net investment in leases are detailed as follows:

	September 30, 2018									December 31, 2017
(dollars in thousands)	Originated			Acquired			Total Leases			Originated			Acquired			Total Leases
Minimum lease payments receivable	$	122,596		$	32,039		$	154,635		$	75,592		$	55,219		$	130,811
Unearned lease income	(17,717		)	(4,293		)	(22,010		)	(10,338		)	(9,523		)	(19,861		)
Initial direct costs and deferred fees	5,055			793			5,848			2,781			1,670			4,451
Total Leases	$	109,934		$	28,539		$	138,473		$	68,035		$	47,366		$	115,401

C. Non-Performing Loans and Leases⁽¹⁾  

	September 30, 2018						December 31, 2017
(dollars in thousands)	Originated		Acquired		Total Loans and Leases		Originated		Acquired		Total Loans and Leases
Commercial mortgage	$	—	$	735	$	735	$	90	$	782	$	872
Home equity lines and loans	1,692		241		1,933		1,221		260		1,481
Residential mortgage	1,968		802		2,770		1,505		2,912		4,417
Construction	291		—		291		—		—		—
Commercial and industrial	925		857		1,782		826		880		1,706
Consumer	42		75		117		—		—		—
Leases	479		883		1,362		103		—		103
Total non-performing loans and leases	$	5,397	$	3,593	$	8,990	$	3,745	$	4,834	$	8,579

(1) Purchased credit-impaired loans, which have been recorded at their fair values at acquisition, and which are performing, are excluded from this table, with theexception of$393 thousandand $167 thousand of purchased credit-impaired loans as of September 30, 2018 and December 31, 2017,respectively, which became non-performing subsequent to acquisition.

D. Purchased Credit-Impaired Loans

The outstanding principal balance and related carrying amount of purchased credit-impaired loans, for which the Corporation applies ASC 310-30, Accounting for Purchased Loans with Deteriorated Credit Quality, to account for the interest earned, as of the dates indicated, are as follows:

(dollars in thousands)	September 30, 2018		December 31, 2017
Outstanding principal balance	$	38,062	$	46,543
Carrying amount(1)	$	27,519	$	30,849

(1) Includes $393 thousand and $173 thousand of purchased credit-impaired loans as of September 30, 2018 and December 31, 2017, respectively, for which the Corporation could not estimate the timing or amount of expected cash flows to be collected at acquisition, and for which no accretable yield is recognized. Additionally, the table above includes $393 thousand and $167 thousand of purchased credit-impaired loans as of September 30, 2018 and December 31, 2017, respectively, which became non-performing subsequent to acquisition, which are disclosed in Note 5C, above, and which also have no accretable yield.

The following table presents changes in the accretable discount on purchased credit-impaired loans, for which the Corporation applies ASC 310-30, for the nine months ended September 30, 2018: 

(dollars in thousands)	Accretable Discount
Balance, December 31, 2017	$	4,083
Accretion	(1,819		)
Reclassifications from nonaccretable difference	609
Additions/adjustments	329
Balance, September 30, 2018	$	3,202

E. Age Analysis of Past Due Loans and Leases

The following tables present an aging of all portfolio loans and leases as of the dates indicated:

	Accruing Loans and Leases
As of September 30, 2018	30 – 59 Days Past Due		60 – 89 Days Past Due		Over 89 Days Past Due		Total Past Due		Current*		Total Accruing Loans and Leases		Nonaccrual Loans and Leases		Total Loans and Leases
(dollars in thousands)
Commercial mortgage	$	—	$	2,468	$	—	$	2,468	$	1,615,290	$	1,617,758	$	735	$	1,618,493
Home equity lines and loans	324		—		—		324		205,549		205,873		1,933		207,806
Residential mortgage	2,218		179		—		2,397		462,235		464,632		2,770		467,402
Construction	488		—		—		488		177,714		178,202		291		178,493
Commercial and industrial	1,115		1,255		—		2,370		718,847		721,217		1,782		722,999
Consumer	46		23		—		69		47,623		47,692		117		47,809
Leases	751		252		—		1,003		136,108		137,111		1,362		138,473
Total portfolio loans and leases	$	4,942	$	4,177	$	—	$	9,119	$	3,363,366	$	3,372,485	$	8,990	$	3,381,475

	Accruing Loans and Leases
As of December 31, 2017	30 – 59 Days Past Due		60 – 89 Days Past Due		Over 89 Days Past Due		Total Past Due		Current*		Total Accruing Loans and Leases		Nonaccrual Loans and Leases		Total Loans and Leases
(dollars in thousands)
Commercial mortgage	$	1,366	$	2,428	$	—	$	3,794	$	1,518,711	$	1,522,505	$	872	$	1,523,377
Home equity lines and loans	338		10		—		348		216,446		216,794		1,481		218,275
Residential mortgage	1,386		79		—		1,465		453,004		454,469		4,417		458,886
Construction	—		—		—		—		212,454		212,454		—		212,454
Commercial and industrial	658		286		—		944		716,662		717,606		1,706		719,312
Consumer	1,106		—		—		1,106		37,047		38,153		—		38,153
Leases	125		177		—		302		114,996		115,298		103		115,401
Total portfolio loans and leases	$	4,979	$	2,980	$	—	$	7,959	$	3,269,320	$	3,277,279	$	8,579	$	3,285,858

*Included as “current” are $720 thousand and $4.1 million of loans and leases as of September 30, 2018 and December 31, 2017, respectively, which are classified as administratively delinquent. An administratively delinquent loan is one which has been approved for a renewal or extension but has not had all the required documents fully executed as of the reporting date. Management does not consider these loans to be delinquent.

The following tables present an aging of originated portfolio loans and leases as of the dates indicated:

	Accruing Loans and Leases
As of September 30, 2018	30 – 59 Days Past Due		60 – 89 Days Past Due		Over 89 Days Past Due		Total Past Due		Current*		Total Accruing Loans and Leases		Nonaccrual Loans and Leases		Total Loans and Leases
(dollars in thousands)
Commercial mortgage	$	—	$	76	$	—	$	76	$	1,259,321	$	1,259,397	$	—	$	1,259,397
Home equity lines and loans	250		—		—		250		178,126		178,376		1,692		180,068
Residential mortgage	1,475		—		—		1,475		377,594		379,069		1,968		381,037
Construction	488		—		—		488		157,912		158,400		291		158,691
Commercial and industrial	1,051		1,255		—		2,306		614,969		617,275		925		618,200
Consumer	46		23		—		69		44,722		44,791		42		44,833
Leases	407		115		—		522		108,933		109,455		479		109,934
Total originated portfolio loans and leases	$	3,717	$	1,469	$	—	$	5,186	$	2,741,577	$	2,746,763	$	5,397	$	2,752,160

	Accruing Loans and Leases
As of December 31, 2017	30 – 59 Days Past Due		60 – 89 Days Past Due		Over 89 Days Past Due		Total Past Due		Current*		Total Accruing Loans and Leases		Nonaccrual Loans and Leases		Total Loans and Leases
(dollars in thousands)
Commercial mortgage	$	1,255	$	81	$	—	$	1,336	$	1,120,901	$	1,122,237	$	90	$	1,122,327
Home equity lines and loans	26		—		—		26		182,036		182,062		1,221		183,283
Residential mortgage	721		—		—		721		358,709		359,430		1,505		360,935
Construction	—		—		—		—		128,266		128,266		—		128,266
Commercial and industrial	439		236		—		675		587,803		588,478		826		589,304
Consumer	21		—		—		21		35,125		35,146		—		35,146
Leases	125		177		—		302		67,630		67,932		103		68,035
Total originated portfolio loans and leases	$	2,587	$	494	$	—	$	3,081	$	2,480,470	$	2,483,551	$	3,745	$	2,487,296

*Included as “current” are $720 thousand and $4.0 million of loans and leases as of September 30, 2018 and December 31, 2017, respectively, which are classified as administratively delinquent. An administratively delinquent loan is one which has been approved for a renewal or extension but has not had all the required documents fully executed as of the reporting date. Management does not consider these loans to be delinquent.

The following tables present an aging of acquired portfolio loans and leases as of the dates indicated:

	Accruing Loans and Leases
As of September 30, 2018	30 – 59 Days Past Due		60 – 89 Days Past Due		Over 89 Days Past Due		Total Past Due		Current*		Total Accruing Loans and Leases		Nonaccrual Loans and Leases		Total Loans and Leases
(dollars in thousands)
Commercial mortgage	$	—	$	2,392	$	—	$	2,392	$	355,969	$	358,361	$	735	$	359,096
Home equity lines and loans	74		—		—		74		27,423		27,497		241		27,738
Residential mortgage	743		179		—		922		84,641		85,563		802		86,365
Construction	—		—		—		—		19,802		19,802		—		19,802
Commercial and industrial	64		—		—		64		103,878		103,942		857		104,799
Consumer	—		—		—		—		2,901		2,901		75		2,976
Leases	344		137		—		481		27,175		27,656		883		28,539
Total acquired portfolio loans and leases	$	1,225	$	2,708	$	—	$	3,933	$	621,789	$	625,722	$	3,593	$	629,315

	Accruing Loans and Leases
As of December 31, 2017	30 – 59 Days Past Due		60 – 89 Days Past Due		Over 89 Days Past Due		Total Past Due		Current*		Total Accruing Loans and Leases		Nonaccrual Loans and Leases		Total Loans and Leases
(dollars in thousands)
Commercial mortgage	$	111	$	2,347	$	—	$	2,458	$	397,810	$	400,268	$	782	$	401,050
Home equity lines and loans	312		10		—		322		34,410		34,732		260		34,992
Residential mortgage	665		79		—		744		94,295		95,039		2,912		97,951
Construction	—		—		—		—		84,188		84,188		—		84,188
Commercial and industrial	219		50		—		269		128,859		129,128		880		130,008
Consumer	1,085		—		—		1,085		1,922		3,007		—		3,007
Leases	—		—		—		—		47,366		47,366		—		47,366
Total acquired portfolio loans and leases	$	2,392	$	2,486	$	—	$	4,878	$	788,850	$	793,728	$	4,834	$	798,562

*Included as “current” are $0 and $102 thousand of loans and leases as of September 30, 2018 and December 31, 2017, respectively, which are classified as administratively delinquent. An administratively delinquent loan is one which has been approved for a renewal or extension but has not had all the required documents fully executed as of the reporting date. Management does not consider these loans to be delinquent.

F. Allowance for Loan and Lease Losses (the “Allowance”)

The following tables detail the roll-forward of the Allowance for the three and nine months ended September 30, 2018 and 2017:

(dollars in thousands)	Commercial Mortgage			Home Equity Lines and Loans			Residential Mortgage			Construction		Commercial and Industrial			Consumer			Leases			Unallocated		Total
Balance, December 31, 2017	$	7,550		$	1,086		$	1,926		$	937	$	5,038		$	246		$	742		$	—	$	17,525
Charge-offs	(74		)	(225		)	(42		)	—		(1,069		)	(165		)	(2,416		)	—		(3,991		)
Recoveries	8			1			55			1		17			5			232			—		319
Provision for loan and lease losses	60			30			(121		)	303		1,319			232			3,008			—		4,831
Balance, September 30, 2018	$	7,544		$	892		$	1,818		$	1,241	$	5,305		$	318		$	1,566		$	—	$	18,684

(dollars in thousands)	Commercial Mortgage			Home Equity Lines and Loans			Residential Mortgage			Construction		Commercial and Industrial			Consumer			Leases			Unallocated		Total
Balance, June 30, 2018	$	8,033		$	933		$	1,933		$	1,158	$	5,672		$	289		$	1,380		$	—	$	19,398
Charge-offs	(58		)	—			(42		)	—		(319		)	(73		)	(1,068		)	—		(1,560		)
Recoveries	2			—			54			—		16			2			108			—		182
Provision for loan and lease losses	(433		)	(41		)	(127		)	83		(64		)	100			1,146			—		664
Balance, September 30, 2018	$	7,544		$	892		$	1,818		$	1,241	$	5,305		$	318		$	1,566		$	—	$	18,684

(dollars in thousands)	Commercial Mortgage		Home Equity Lines and Loans			Residential Mortgage			Construction			Commercial and Industrial			Consumer			Leases			Unallocated		Total
Balance, December 31, 2016	$	6,227	$	1,255		$	1,917		$	2,233		$	5,142		$	153		$	559		$	—	$	17,486
Charge-offs	—		(676		)	(158		)	—			(560		)	(96		)	(924		)	—		(2,414		)
Recoveries	9		—			85			3			18			5			271			—		391
Provision for loan and lease losses	1,096		513			(23		)	(1,306		)	280			148			833			—		1,541
Balance, September 30, 2017	$	7,332	$	1,092		$	1,821		$	930		$	4,880		$	210		$	739		$	—	$	17,004

(dollars in thousands)	Commercial Mortgage		Home Equity Lines and Loans			Residential Mortgage			Construction			Commercial and Industrial			Consumer			Leases			Unallocated		Total
Balance, June 30, 2017	$	6,608	$	1,214		$	1,776		$	1,111		$	4,813		$	177		$	700		$	—	$	16,399
Charge-offs	—		(69		)	(88		)	—			(301		)	(37		)	(411		)	—		(906		)
Recoveries	3		—			85			1			2			1			86			—		178
Provision for loan and lease losses	721		(53		)	48			(182		)	366			69			364			—		1,333
Balance, September 30, 2017	$	7,332	$	1,092		$	1,821		$	930		$	4,880		$	210		$	739		$	—	$	17,004

The following tables detail the allocation of the Allowance for all portfolio loans and leases by portfolio segment based on the methodology used to evaluate the loans and leases for impairment as of September 30, 2018 and December 31, 2017:

As of September 30, 2018	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Unallocated		Total
(dollars in thousands)
Allowance on loans and leases:
Individually evaluated for impairment	$	—	$	19	$	228	$	—	$	11	$	20	$	—	$	—	$	278
Collectively evaluated for impairment	7,544		873		1,590		1,241		5,294		298		1,566		—		18,406
Purchased credit-impaired(1)	—		—		—		—		—		—		—		—		—
Total	$	7,544	$	892	$	1,818	$	1,241	$	5,305	$	318	$	1,566	$	—	$	18,684

⁽¹⁾ Purchased credit-impaired loans are evaluated for impairment on an individual basis.

As of December 31, 2017	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Unallocated		Total
(dollars in thousands)
Allowance on loans and leases:
Individually evaluated for impairment	$	—	$	19	$	230	$	—	$	5	$	4	$	—	$	—	$	258
Collectively evaluated for impairment	7,550		1,067		1,696		937		5,033		242		742		—		17,267
Purchased credit-impaired(1)	—		—		—		—		—		—		—		—		—
Total	$	7,550	$	1,086	$	1,926	$	937	$	5,038	$	246	$	742	$	—	$	17,525

⁽¹⁾ Purchased credit-impaired loans are evaluated for impairment on an individual basis.

The following tables detail the carrying value for all portfolio loans and leases by portfolio segment based on the methodology used to evaluate the loans and leases for impairment as of September 30, 2018 and December 31, 2017:

As of September 30, 2018	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Carrying value of loans and leases:
Individually evaluated for impairment	$	736	$	2,602	$	5,940	$	291	$	1,757	$	144	$	—	$	11,470
Collectively evaluated for impairment	1,609,375		204,694		461,462		175,802		705,015		47,665		138,473		3,342,486
Purchased credit-impaired(1)	8,382		510		—		2,400		16,227		—		—		27,519
Total	$	1,618,493	$	207,806	$	467,402	$	178,493	$	722,999	$	47,809	$	138,473	$	3,381,475

⁽¹⁾ Purchased credit-impaired loans are evaluated for impairment on an individual basis.

As of December 31, 2017	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Carrying value of loans and leases:
Individually evaluated for impairment	$	2,128	$	2,162	$	7,726	$	—	$	1,897	$	27	$	—	$	13,940
Collectively evaluated for impairment	1,503,825		215,604		451,160		204,088		712,865		38,126		115,401		3,241,069
Purchased credit-impaired(1)	17,424		509		—		8,366		4,550		—		—		30,849
Total	$	1,523,377	$	218,275	$	458,886	$	212,454	$	719,312	$	38,153	$	115,401	$	3,285,858

⁽¹⁾ Purchased credit-impaired loans are evaluated for impairment on an individual basis.

The following tables detail the allocation of the Allowance for originated portfolio loans and leases by portfolio segment based on the methodology used to evaluate the loans and leases for impairment as of September 30, 2018 and December 31, 2017:

As of September 30, 2018	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Allowance on loans and leases:
Individually evaluated for impairment	$	—	$	19	$	179	$	—	$	4	$	4	$	—	$	206
Collectively evaluated for impairment	7,544		873		1,590		1,241		5,294		298		1,566		18,406
Total	$	7,544	$	892	$	1,769	$	1,241	$	5,298	$	302	$	1,566	$	18,612

As of December 31, 2017	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Allowance on loans and leases:
Individually evaluated for impairment	$	—	$	19	$	180	$	—	$	5	$	4	$	—	$	208
Collectively evaluated for impairment	7,550		1,067		1,696		937		5,033		242		742		17,267
Total	$	7,550	$	1,086	$	1,876	$	937	$	5,038	$	246	$	742	$	17,475

The following tables detail the carrying value for originated portfolio loans and leases by portfolio segment based on the methodology used to evaluate the loans and leases for impairment as of September 30, 2018 and December 31, 2017:

As of September 30, 2018	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Carrying value of loans and leases:
Individually evaluated for impairment	$	—	$	2,361	$	4,268	$	291	$	1,294	$	68	$	—	$	8,282
Collectively evaluated for impairment	1,259,397		177,707		376,769		158,400		616,906		44,765		109,934		2,743,878
Total	$	1,259,397	$	180,068	$	381,037	$	158,691	$	618,200	$	44,833	$	109,934	$	2,752,160

As of December 31, 2017	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Carrying value of loans and leases:
Individually evaluated for impairment	$	1,345	$	1,902	$	4,418	$	—	$	1,186	$	27	$	—	$	8,878
Collectively evaluated for impairment	1,120,982		181,381		356,517		128,266		588,118		35,119		68,035		2,478,418
Total	$	1,122,327	$	183,283	$	360,935	$	128,266	$	589,304	$	35,146	$	68,035	$	2,487,296

The following tables detail the allocation of the Allowance for acquired portfolio loans and leases by portfolio segment based on the methodology used to evaluate the loans and leases for impairment as of September 30, 2018 and December 31, 2017:

As of September 30, 2018	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Allowance on loans and leases:
Individually evaluated for impairment	$	—	$	—	$	49	$	—	$	7	$	16	$	—	$	72
Collectively evaluated for impairment	—		—		—		—		—		—		—		—
Purchased credit-impaired(1)	—		—		—		—		—		—		—		—
Total	$	—	$	—	$	49	$	—	$	7	$	16	$	—	$	72

⁽¹⁾ Purchased credit-impaired loans are evaluated for impairment on an individual basis.

As of December 31, 2017	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Allowance on loans and leases:
Individually evaluated for impairment	$	—	$	—	$	50	$	—	$	—	$	—	$	—	$	50
Collectively evaluated for impairment	—		—		—		—		—		—		—		—
Purchased credit-impaired(1)	—		—		—		—		—		—		—		—
Total	$	—	$	—	$	50	$	—	$	—	$	—	$	—	$	50

⁽¹⁾ Purchased credit-impaired loans are evaluated for impairment on an individual basis.

The following tables detail the carrying value for acquired portfolio loans and leases by portfolio segment based on the methodology used to evaluate the loans and leases for impairment as of September 30, 2018 and December 31, 2017:

As of September 30, 2018	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Carrying value of loans and leases:
Individually evaluated for impairment	$	736	$	241	$	1,672	$	—	$	463	$	76	$	—	$	3,188
Collectively evaluated for impairment	349,978		26,987		84,693		17,402		88,109		2,900		28,539		598,608
Purchased credit-impaired(1)	8,382		510		—		2,400		16,227		—		—		27,519
Total	$	359,096	$	27,738	$	86,365	$	19,802	$	104,799	$	2,976	$	28,539	$	629,315

⁽¹⁾Purchased credit-impaired loans are evaluated for impairment on an individual basis.

As of December 31, 2017	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Carrying value of loans and leases:
Individually evaluated for impairment	$	783	$	260	$	3,308	$	—	$	711	$	—	$	—	$	5,062
Collectively evaluated for impairment	382,843		34,223		94,643		75,822		124,747		3,007		47,366		762,651
Purchased credit-impaired(1)	17,424		509		—		8,366		4,550		—		—		30,849
Total	$	401,050	$	34,992	$	97,951	$	84,188	$	130,008	$	3,007	$	47,366	$	798,562

⁽¹⁾Purchased credit-impaired loans are evaluated for impairment on an individual basis.

As part of the process of determining the Allowance for the different segments of the loan and lease portfolio, management considers certain credit quality indicators. For the commercial mortgage, construction and commercial and industrial loan segments, periodic reviews of the individual loans are performed by both in-house staff as well as external loan reviewers. The result of these reviews is reflected in the risk grade assigned to each loan. These internally assigned grades are as follows:

• Pass – Loans considered satisfactory with no indications of deterioration.

• Special mention - Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.

• Substandard - Loans classified as substandard are inadequately protected by the current net worth and payment capacity of the obligor or of the collateral pledged, if any. Substandard loans have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

• Doubtful - Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

In addition, for the remaining segments of the loan and lease portfolio, which include residential mortgage, home equity lines and loans, consumer, and leases, the credit quality indicator used to determine this component of the Allowance is based on performance status.

The following tables detail the carrying value of all portfolio loans and leases by portfolio segment based on the credit quality indicators used to determine the Allowance as of September 30, 2018 and December 31, 2017:

Credit Risk Profile by Internally Assigned Grade

	Commercial Mortgage				Construction				Commercial and Industrial				Total
(dollars in thousands)	September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017
Pass	$	1,592,174	$	1,490,862	$	168,897	$	193,227	$	697,913	$	711,145	$	2,458,984	$	2,395,234
Special Mention	2,321		13,448		934		3,902		2,425		889		5,680		18,239
Substandard	23,447		18,194		8,662		15,325		22,660		6,013		54,769		39,532
Doubtful	551		873		—		—		1		1,265		552		2,138
Total	$	1,618,493	$	1,523,377	$	178,493	$	212,454	$	722,999	$	719,312	$	2,519,985	$	2,455,143

Credit Risk Profile by Payment Activity

	Residential Mortgage				Home Equity Lines and Loans				Consumer				Leases				Total
(dollars inthousands)	September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017
Performing	$	464,632	$	454,469	$	205,873	$	216,794	$	47,692	$	38,153	$	137,111	$	115,298	$	855,308	$	824,714
Non-performing	2,770		4,417		1,933		1,481		117		—		1,362		103		6,182		6,001
Total	$	467,402	$	458,886	$	207,806	$	218,275	$	47,809	$	38,153	$	138,473	$	115,401	$	861,490	$	830,715

The following tables detail the carrying value of originated portfolio loans and leases by portfolio segment based on the credit quality indicators used to determine the Allowance as of September 30, 2018 and December 31, 2017:

Credit Risk Profile by Internally Assigned Grade

	Commercial Mortgage				Construction				Commercial and Industrial				Total
(dollars in thousands)	September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017
Pass	$	1,252,916	$	1,114,171	$	152,429	$	126,260	$	610,730	$	586,896	$	2,016,075	$	1,827,327
Special Mention	—		—		—		—		2,198		664		2,198		664
Substandard	6,481		8,156		6,262		2,006		5,271		1,389		18,014		11,551
Doubtful	—		—		—		—		1		355		1		355
Total	$	1,259,397	$	1,122,327	$	158,691	$	128,266	$	618,200	$	589,304	$	2,036,288	$	1,839,897

Credit Risk Profile by Payment Activity

	Residential Mortgage				Home Equity Lines and Loans				Consumer				Leases				Total
(dollars in thousands)	September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017
Performing	$	379,069	$	359,430	$	178,376	$	182,062	$	44,791	$	35,146	$	109,455	$	67,932	$	711,691	$	644,570
Non-performing	1,968		1,505		1,692		1,221		42		—		479		103		4,181		2,829
Total	$	381,037	$	360,935	$	180,068	$	183,283	$	44,833	$	35,146	$	109,934	$	68,035	$	715,872	$	647,399

The following tables detail the carrying value of acquired portfolio loans and leases by portfolio segment based on the credit quality indicators used to determine the Allowance as of September 30, 2018 and December 31, 2017:

Credit Risk Profile by Internally Assigned Grade

	Commercial Mortgage				Construction				Commercial and Industrial				Total
(dollars in thousands)	September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017
Pass	$	339,258	$	376,691	$	16,468	$	66,967	$	87,183	$	124,249	$	442,909	$	567,907
Special Mention	2,321		13,448		934		3,902		227		225		3,482		17,575
Substandard	16,966		10,038		2,400		13,319		17,389		4,624		36,755		27,981
Doubtful	551		873		—		—		—		910		551		1,783
Total	$	359,096	$	401,050	$	19,802	$	84,188	$	104,799	$	130,008	$	483,697	$	615,246

 Credit Risk Profile by Payment Activity

	Residential Mortgage				Home Equity Lines and Loans				Consumer				Leases				Total
(dollars inthousands)	September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017
Performing	$	85,563	$	95,039	$	27,497	$	34,732	$	2,901	$	3,007	$	27,656	$	47,366	$	143,617	$	180,144
Non-performing	802		2,912		241		260		75		—		883		—		2,001		3,172
Total	$	86,365	$	97,951	$	27,738	$	34,992	$	2,976	$	3,007	$	28,539	$	47,366	$	145,618	$	183,316

G. Troubled Debt Restructurings (“TDRs”)

The restructuring of a loan is considered a “troubled debt restructuring” if both of the following conditions are met: (i) the borrower is experiencing financial difficulties, and (ii) the creditor has granted a concession. The most common concessions granted include one or more modifications to the terms of the debt, such as (a) a reduction in the interest rate for the remaining life of the debt, (b) an extension of the maturity date at an interest rate lower than the current market rate for new debt with similar risk, (c) a temporary period of interest-only payments, (d) a reduction in the contractual payment amount for either a short period or remaining term of the loan, and (e) for leases, a reduced lease payment. A less common concession granted is the forgiveness of a portion of the principal.

The determination of whether a borrower is experiencing financial difficulties takes into account not only the current financial condition of the borrower, but also the potential financial condition of the borrower, were a concession not granted. Similarly, the determination of whether a concession has been granted is very subjective in nature. For example, simply extending the term of a loan at its original interest rate or even at a higher interest rate could be interpreted as a concession unless the borrower could readily obtain similar credit terms from a different lender.

The following table presents the balance of TDRs as of the indicated dates:

(dollars in thousands)	September 30, 2018		December 31, 2017
TDRs included in nonperforming loans and leases	$	1,208	$	3,289
TDRs in compliance with modified terms	4,316		5,800
Total TDRs	$	5,524	$	9,089

The following table presents information regarding loan and lease modifications categorized as TDRs for the three months ended September 30, 2018:

	For the Three Months Ended September 30, 2018
(dollars in thousands)	Number of Contracts	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
Home equity loans and lines	—	$	—	$	—
Residential mortgages	4	406		430
Leases	—	—		—
Total	4	$	406	$	430

The following table presents information regarding the types of loan and lease modifications made for the three months ended September 30, 2018:

	Number of Contracts
	Loan Term Extension	Interest Rate Change and Term Extension	Interest Rate Change and/or Interest-Only Period	Contractual Payment Reduction (Leases only)	Temporary Payment Deferral
Home equity loans and lines	—	—	—	—	—
Residential mortgages	1	—	—	—	3
Leases	—	—	—	—	—
Total	1	—	—	—	3

The following table presents information regarding loan and lease modifications categorized as TDRs for the nine months ended September 30, 2018: 

	For the Nine Months Ended September 30, 2018
(dollars in thousands)	Number of Contracts	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
Home equity loans and lines	1	$	8	$	8
Residential mortgages	6	625		649
Commercial and industrial	1	18		18
Leases	2	33		33
Total	10	$	684	$	708

The following table presents information regarding the types of loan and lease modifications made for the nine months ended September 30, 2018:

	Number of Contracts
	Loan Term Extension	Interest Rate Change and Term Extension	Interest Rate Change and/or Interest-Only Period	Contractual Payment Reduction (Leases only)	Temporary Payment Deferral
Home equity loans and lines	—	1	—	—	—
Residential mortgages	2	1	—	—	3
Commercial and industrial	—	1	—	—	—
Leases	—	—	—	2	—
Total	2	3	—	2	3

During the nine months ended September 30, 2018, one home equity line of credit with a principal balance of $25 thousand and one lease with a principal balance of $50 thousand, which had been previously modified to troubled debt restructurings defaulted and were charged off.

H. Impaired Loans

The following tables detail the recorded investment and principal balance of impaired loans by portfolio segment, their related Allowance and interest income recognized for the three and nine months ended September 30, 2018 and 2017 (purchased credit-impaired loans are not included in the tables):

As of and for the Three Months Ended September 30, 2018	Recorded Investment**		Principal Balance		Related Allowance		Average Principal Balance		Interest Income Recognized		Cash-Basis Interest Income Recognized
(dollars in thousands)
Impaired loans with related allowance:
Home equity lines and loans	$	567	$	567	$	19	$	569	$	6	$	—
Residential mortgage	1,699		1,699		228		1,702		20		—
Commercial and industrial	25		25		12		25		—		—
Consumer	58		58		19		58		—		—
Total	$	2,349	$	2,349	$	278	$	2,354	$	26	$	—
Impaired loans without related allowance*:
Commercial mortgage	$	735	$	793	$	—	$	930	$	—	$	—
Home equity lines and loans	2,035		2,096		—		2,064		2		—
Residential mortgage	4,242		4,328		—		4,299		24		—
Construction	291		291		—		294		—		—
Commercial and industrial	1,733		2,665		—		2,138		5		—
Consumer	86		86		—		87		—		—
Total	$	9,122	$	10,259	$	—	$	9,812	$	31	$	—
Grand total	$	11,471	$	12,608	$	278	$	12,166	$	57	$	—

*The table above does not include the recorded investment of $1.4 million of impaired leases without a related Allowance.

**Recorded investment equals principal balance less partial charge-offs and interest payments on non-performing loans that have been applied to principal.

As of and for the Nine Months Ended September 30, 2018	Recorded Investment**		Principal Balance		Related Allowance		Average Principal Balance		Interest Income Recognized		Cash-Basis Interest Income Recognized
(dollars in thousands)
Impaired loans with related allowance:
Home equity lines and loans	$	567	$	567	$	19	$	572	$	17	$	—
Residential mortgage	1,699		1,699		228		1,709		60		—
Commercial and industrial	25		25		12		29		1		—
Consumer	58		58		19		58		1		—
Total	$	2,349	$	2,349	$	278	$	2,368	$	79	$	—
Impaired loans without related allowance*:
Commercial mortgage	$	735	$	793	$	—	$	825	$	6	$	—
Home equity lines and loans	2,035		2,096		—		2,086		10		—
Residential mortgage	4,242		4,328		—		4,228		91		—
Construction	291		291				239		5		—
Commercial and industrial	1,733		2,665		—		2,236		56		—
Consumer	86		86				88		3		—
Total	$	9,122	$	10,259	$	—	$	9,702	$	171	$	—
Grand total	$	11,471	$	12,608	$	278	$	12,070	$	250	$	—

*The table above does not include the recorded investment of $1.4 million of impaired leases without a related Allowance.

**Recorded investment equals principal balance less partial charge-offs and interest payments on non-performing loans that have been applied to principal.

As of and for the Three Months Ended September 30, 2017	Recorded Investment**		Principal Balance		Related Allowance		Average Principal Balance		Interest Income Recognized		Cash-Basis Interest Income Recognized
(dollars in thousands)
Impaired loans with related allowance:
Home equity lines and loans	$	21	$	21	$	3	$	21	$	—	$	—
Residential mortgage	1,770		1,770		116		1,776		23		—
Consumer	27		27		4		28		—		—
Total	$	1,818	$	1,818	$	123	$	1,825	$	23	$	—
Impaired loans without related allowance*:
Commercial mortgage	$	1,449	$	1,485	$	—	$	1,451	$	15	$	—
Home equity lines and loans	633		694		—		655		1		—
Residential mortgage	4,688		5,015		—		4,243		43		—
Commercial and industrial	1,940		2,796		—		2,605		2		—
Total	$	8,710	$	9,990	$	—	$	8,954	$	61	$	—
Grand total	$	10,528	$	11,808	$	123	$	10,779	$	84	$	—

*The table above does not include the recorded investment of $270 thousand of impaired leases without a related Allowance.

**Recorded investment equals principal balance less partial charge-offs and interest payments on non-performing loans that have been applied to principal.

As of and for the Nine Months Ended September 30, 2017	Recorded Investment**		Principal Balance		Related Allowance		Average Principal Balance		Interest Income Recognized		Cash-Basis Interest Income Recognized
(dollars in thousands)
Impaired loans with related allowance:
Home equity lines and loans	$	21	$	21	$	3	$	21	$	1	$	—
Residential mortgage	1,770		1,770		116		1,797		67		—
Consumer	27		27		4		28		1		—
Total	$	1,818	$	1,818	$	123	$	1,846	$	69	$	—
Impaired loans without related allowance*:
Commercial mortgage	$	1,449	$	1,485	$	—	$	1,475	$	45	$	—
Home equity lines and loans	633		694		—		669		5		—
Residential mortgage	4,688		5,015		—		4,288		118		—
Commercial and industrial	1,940		2,796		—		2,746		34		—
Total	$	8,710	$	9,990	$	—	$	9,178	$	202	$	—
Grand total	$	10,528	$	11,808	$	123	$	11,024	$	271	$	—

*The table above does not include the recorded investment of $270 thousand of impaired leases without a related Allowance.

**Recorded investment equals principal balance less partial charge-offs and interest payments on non-performing loans that have been applied to principal.

(dollars in thousands)	Recorded Investment (2)		Principal Balance		Related Allowance
As of December 31, 2017
Impaired loans with related allowance:
Home equity lines and loans	$	577	$	577	$	19
Residential mortgage	2,436		2,435		230
Commercial and industrial	18		19		5
Consumer	27		27		4
Total	$	3,058	$	3,058	$	258
Impaired loans without related allowance(1):
Home equity lines and loans	$	1,585	$	1,645	$	—
Residential mortgage	5,290		5,529		—
Commercial and industrial	1,879		3,613		—
Commercial mortgage	2,128		2,218		—
Total	$	10,882	$	13,005	$	—
Grand total	$	13,940	$	16,063	$	258

⁽¹⁾  The table above does not include the recorded investment of$272 thousandof impaired leases without a related Allowance.

⁽²⁾  Recorded investment equals principal balance less partial charge-offs and interest payments on non-performing loans that have been applied to principal.

I. Loan Mark

Loans acquired in mergers and acquisitions are recorded at fair value as of the date of the transaction. This adjustment to the acquired principal amount is referred to as the “Loan Mark.” With the exception of purchased credit impaired loans, for which the Loan Mark is accounted under ASC 310-30, the Loan Mark is amortized or accreted as an adjustment to yield over the lives of the loans.

The following tables detail, for acquired loans, the outstanding principal, remaining Loan Mark, and recorded investment, by portfolio segment, as of the dates indicated:

	As of September 30, 2018
(dollars in thousands)	Outstanding Principal		Remaining Loan Mark			Recorded Investment
Commercial mortgage	$	369,894	$	(10,798	)	$	359,096
Home equity lines and loans	30,240		(2,502		)	27,738
Residential mortgage	89,302		(2,937		)	86,365
Construction	20,142		(340		)	19,802
Commercial and industrial	111,799		(7,000		)	104,799
Consumer	3,094		(118		)	2,976
Leases	29,793		(1,254		)	28,539
Total	$	654,264	$	(24,949	)	$	629,315

	As of December 31, 2017
(dollars in thousands)	Outstanding Principal		Remaining Loan Mark			Recorded Investment
Commercial mortgage	$	412,263	$	(11,213	)	$	401,050
Home equity lines and loans	37,944		(2,952		)	34,992
Residential mortgage	101,523		(3,572		)	97,951
Construction	86,081		(1,893		)	84,188
Commercial and industrial	141,960		(11,952		)	130,008
Consumer	3,051		(44		)	3,007
Leases	50,530		(3,164		)	47,366
Total	$	833,352	$	(34,790	)	$	798,562

XML

Mortgage Servicing Rights

9 Months Ended

Sep. 30, 2018

Transfers and Servicing [Abstract]

Mortgage Servicing Rights

Mortgage Servicing Rights

The following table summarizes the Corporation’s activity related to mortgage servicing rights (“MSRs”) for the three and nine months ended September 30, 2018 and 2017:

	Three Months Ended September 30,
(dollars in thousands)	2018			2017
Balance, beginning of period	$	5,511		$	5,682
Additions	—			282
Amortization	(206		)	(229		)
Recovery / (Impairment)	23			(3		)
Balance, end of period	$	5,328		$	5,732
Fair value	$	6,586		$	6,146

	Nine Months Ended September 30,
(dollars in thousands)	2018			2017
Balance, beginning of period	$	5,861		$	5,582
Additions	16			770
Amortization	(623		)	(571		)
Recovery / (Impairment)	74			(49		)
Balance, end of period	$	5,328		$	5,732
Fair value	$	6,586		$	6,146
Residential mortgage loans serviced for others	$	596,162		$	647,997

As of September 30, 2018, and December 31, 2017, key economic assumptions and the sensitivity of the current fair value of MSRs to immediate 10% and 20% adverse changes in those assumptions are as follows:

(dollars in thousands)	September 30, 2018			December 31, 2017
Fair value amount of MSRs	$	6,586		$	6,397
Weighted average life (in years)	6.6			6.1
Prepayment speeds (constant prepayment rate)*	8.7		%	10.3		%
Impact on fair value:
10% adverse change	$	(85	)	$	(194	)
20% adverse change	$	(190	)	$	(394	)
Discount rate	9.55		%	9.55		%
Impact on fair value:
10% adverse change	$	(245	)	$	(225	)
20% adverse change	$	(472	)	$	(434	)

*Represents the weighted average prepayment rate for the life of the MSR asset.

At September 30, 2018 and December 31, 2017 the fair value of the MSRs was $6.6 million and $6.4 million, respectively. The fair value of the MSRs for these dates was determined using values obtained from a third party which utilizes a valuation model which calculates the present value of estimated future servicing income. The model incorporates assumptions that market participants use in estimating future net servicing income, including estimates of prepayment speeds and discount rates. Mortgage loan prepayment speed is the annual rate at which borrowers are forecasted to repay their mortgage loan principal and is based on historical experience. The discount rate is used to determine the present value of future net servicing income. Another key assumption in the model is the required rate of return the market would expect for an asset with similar risk. These assumptions can, and generally will, change quarterly valuations as market conditions and interest rates change. Management reviews, annually, the process utilized by its independent third-party valuation experts.

These assumptions and sensitivities are hypothetical and should be used with caution. As the figures indicate, changes in fair value based on a 10% variation in assumptions generally cannot be extrapolated because the relationship of the change in assumptions to the change in fair value may not be linear. Also, the effect of a variation in a particular assumption on the fair value of the MSRs is calculated without changing any other assumption. In reality, changes in one factor may result in changes in another, which could magnify or counteract the sensitivities.

XML

Goodwill and Intangibles Assets

9 Months Ended

Sep. 30, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangibles Assets

Goodwill and Intangible Assets

The following table presents activity in the Corporation's goodwill by its reporting units and finite-lived and indefinite-lived intangible assets, other than MSRs, for the nine months ended September 30, 2018:

(dollars in thousands)	Balance December 31, 2017		Additions		Adjustments		Amortization			Balance September 30, 2018		Amortization Period
Goodwill – Wealth	$	20,412	$	—	$	—	$	—		$	20,412	Indefinite
Goodwill – Banking	153,545		—		3,298		—			156,843		Indefinite
Goodwill – Insurance	5,932		677		—		—			6,609		Indefinite
Total Goodwill	$	179,889	$	677	$	3,298	$	—		$	183,864
Core deposit intangible	$	7,380	$	—	$	—	$	(1,108	)	$	6,272	10 years
Customer relationships	14,173		994		—		(1,271		)	13,896		10 to 20 years
Non-compete agreements	1,319		—		—		(171		)	1,148		5 to 10 years
Trade name	2,322		—		—		(49		)	2,273		3 years to Indefinite
Domain name	151		—		—		—			151		Indefinite
Favorable lease assets	621		—		—		(60		)	561		1 to 16 years
Total Intangible Assets	$	25,966	$	994	$	—	$	(2,659	)	$	24,301
Total Goodwill and Intangible Assets	$	205,855	$	1,671	$	3,298	$	(2,659	)	$	208,165

Management conducted its annual impairment tests for goodwill and indefinite-lived intangible assets as of October 31, 2017 using generally accepted valuation methods. Management determined that no impairment of goodwill or indefinite-lived intangible assets was identified as a result of the annual impairment analyses. Future impairment testing will be conducted each October 31, unless a triggering event occurs in the interim that would suggest possible impairment, in which case it would be tested as of the date of the triggering event. For the eleven months ended September 30, 2018, management determined there were no events that would necessitate impairment testing of goodwill or indefinite-lived intangible assets.

XML

Deposits

9 Months Ended

Sep. 30, 2018

Deposits [Abstract]

Deposits

Deposits

The following table details the components of deposits:

	September 30, 2018		December 31, 2017
(dollars in thousands)
Interest-bearing demand	$	578,243	$	481,336
Money market	812,027		862,639
Savings	286,266		338,572
Retail time deposits	561,123		532,202
Wholesale non-maturity deposits	24,040		62,276
Wholesale time deposits	261,164		171,929
Total interest-bearing deposits	$	2,522,863	$	2,448,954
Noninterest-bearing deposits	834,363		924,844
Total deposits	$	3,357,226	$	3,373,798

XML

Short-Term Borrowings and Long-Term FHLB Advances

9 Months Ended

Sep. 30, 2018

Long-term Federal Home Loan Bank Advances [Abstract]

Short-Term Borrowings and Long-Term FHLB Advances

Short-Term Borrowings and Long-Term FHLB Advances

A. Short-term borrowings

The Corporation’s short-term borrowings (original maturity of one year or less), which consist of funds obtained from overnight repurchase agreements with commercial customers, FHLB advances with original maturities of one year or less and overnight fed funds, are detailed below.

A summary of short-term borrowings is as follows:

(dollars in thousands)	September 30, 2018		December 31, 2017
Repurchase agreements* – commercial customers	$	21,548	$	25,865
Short-term FHLB advances	204,950		212,000
Total short-term borrowings	$	226,498	$	237,865

* Overnight repurchase agreements with no expiration date

The following table sets forth information concerning short-term borrowings:

	Three Months Ended September 30,						Nine Months Ended September 30,
(dollars in thousands)	2018			2017			2018			2017
Balance at period-end	$	226,498		$	180,874		$	226,498		$	180,874
Maximum amount outstanding at any month end	$	302,932		$	184,578		$	302,932		$	184,578
Average balance outstanding during the period	$	218,551		$	182,845		$	205,046		$	110,268
Weighted-average interest rate:
As of the period-end	2.18		%	1.17		%	2.18		%	1.17		%
Paid during the period	2.09		%	1.19		%	1.85		%	0.98		%

Average balances outstanding during the year represent daily average balances and average interest rates represent interest expense divided by the related average balance.

B.Long-termFHLB Advances

As of September 30, 2018 and December 31, 2017, the Corporation had $72.8 million and $139.1 million, respectively, of long-term FHLB advances (original maturities exceeding one year).

The following table presents the remaining periods until maturity of long-term FHLB advances:

(dollars in thousands)	September 30, 2018		December 31, 2017
Within one year	$	28,106	$	83,766
Over one year through five years	44,735		55,374
Total	$	72,841	$	139,140

The following table presents rate and maturity information on FHLB advances and other borrowings: 

	Maturity Range(1)		Weighted Average Rate(1)		Coupon Rate(1)				Balance at
Description	From	To			From		To		September 30, 2018		December 31, 2017
Bullet maturity – fixed rate	10/1/2018	1/2/2020	1.32	%	1.31	%	2.45	%	$	72,841	$	118,131
Convertible-fixed(2)	N/A	N/A	N/A		N/A		N/A		—		21,009
Total									$	72,841	$	139,140

(1)Maturity range, weighted average rate and coupon rate range refers to September 30, 2018balances.

(2)FHLB advances whereby the FHLB has the option, at predetermined times, to convert the fixed interest rate to an adjustable interest rate indexed to the London Interbank Offered Rate (“LIBOR”). The Corporation has the option to prepay these advances, without penalty, if the FHLB elects to convert the interest rate to an adjustable rate. As of September 30, 2018, the Corporation held no FHLB advances with this convertible feature.

C. Other Borrowings Information

In connection with its FHLB borrowings, the Corporation is required to hold the capital stock of the FHLB. The amount of capital stock held was $14.7 million at September 30, 2018, and $20.1 million at December 31, 2017. The carrying amount of the FHLB stock approximates its redemption value.

The level of required investment in FHLB stock is based on the balance of outstanding borrowings the Corporation has from the FHLB.  Although FHLB stock is a financial instrument that represents an equity interest in the FHLB, it does not have a readily determinable fair value. FHLB stock is generally viewed as a long-term investment. Accordingly, when evaluating FHLB stock for impairment, its value should be determined based on the ultimate recoverability of the par value rather than by recognizing temporary declines in value.

The Corporation had a maximum borrowing capacity with the FHLB of $1.50 billion as of September 30, 2018 of which the unused capacity was $1.20 billion. In addition, there were $79.0 million in the overnight federal funds line available and $139.6 million of Federal Reserve Discount Window capacity.

XML

Subordinated Notes

9 Months Ended

Sep. 30, 2018

Subordinated Debt [Abstract]

Subordinated Notes

Subordinated Notes

On December 13, 2017, the Corporation completed the issuance of $70.0 million in aggregate principal amount of fixed-to-floating rate subordinated notes due 2027 (the "2027 Notes") in an underwritten public offering. On August 6, 2015, the Corporation completed the issuance of $30.0 million in aggregate principal amount of fixed-to-floating rate subordinated notes due 2025 (the "2025 Notes") in a private placement transaction to institutional accredited investors. The net proceeds of both offerings increased Tier II regulatory capital at the Corporation level.

The following tables detail the subordinated notes, including debt issuance costs, as of September 30, 2018, and December 31, 2017:

	September 30, 2018				December 31, 2017
(dollars in thousands)	Balance		Rate(1)(2)		Balance		Rate(1)(2)
Subordinated notes – due 2027	$	68,855	4.25	%	$	68,829	4.25	%
Subordinated notes – due 2025	29,627		4.75	%	29,587		4.75	%
Total subordinated notes	$	98,482			$	98,416

(1)The 2027 Notes bear interest at an annual fixed rate of 4.25% from the date of issuance until December 14, 2022, and will thereafter bear interest at a variable rate that will reset quarterly to a level equal to the then-current three-month LIBOR rate plus 2.050% until December 15, 2027, or any early redemption date.

(2)The 2025 Notes bear interest at an annual fixed rate of 4.75% from the date of issuance until August 14, 2020, and will thereafter bear interest at a variable rate that will reset quarterly to a level equal to the then-current three-month LIBOR rate plus 3.068% until August 15, 2025, or any early redemption date.

XML

Junior Subordinated Debentures

9 Months Ended

Sep. 30, 2018

Junior Subordinated Debenture Owed to Unconsolidated Subsidiary Trust [Abstract]

Junior Subordinated Debentures

Junior Subordinated Debentures

In connection with the RBPI Merger, the Corporation acquired Royal Bancshares Capital Trust I (“Trust I”) and Royal Bancshares Capital Trust II (“Trust II”) (collectively, the “Trusts”), which were utilized for the sole purpose of issuing and selling capital securities representing preferred beneficial interests. Although the Corporation owns $774 thousand of the common securities of Trust I and Trust II, the Trusts are not consolidated into the Corporation’s Consolidated Financial Statements as the Corporation is not deemed to be the primary beneficiary of these entities. In connection with the issuance and sale of the capital securities, RBPI issued, and the Corporation assumed as a result of the RBPI Merger, junior subordinated debentures to the Trusts of $10.7 million each, totaling $21.4 million representing the Corporation’s maximum exposure to loss. The junior subordinated debentures incur interest at a coupon rate of 4.48% as of September 30, 2018. The rate resets quarterly based on 3-month LIBOR plus 2.15%.

Each of Trust I and Trust II issued an aggregate principal amount of $12.5 million of capital securities initially bearing fixed and/or fixed/floating interest rates corresponding to the debt securities held by each trust to an unaffiliated investment vehicle and an aggregate principal amount of $387 thousand of common securities bearing fixed and/or fixed/floating interest rates corresponding to the debt securities held by each trust to the Corporation. As a result of the RBPI Merger, the Corporation has fully and unconditionally guaranteed all of the obligations of the Trusts, including any distributions and payments on liquidation or redemption of the capital securities.

The rights of holders of common securities of the Trusts are subordinate to the rights of the holders of capital securities only in the event of a default; otherwise, the common securities’ economic and voting rights are pari passu with the capital securities. The capital and common securities of the Trusts are subject to mandatory redemption upon the maturity or call of the junior subordinated debentures held by each. Unless earlier dissolved, the Trusts will dissolve on December 15, 2034. The junior subordinated debentures are the sole assets of Trusts, mature on December 15, 2034, and may be called at par by the Corporation any time after December 15, 2009. The Corporation records its investments in the Trusts’ common securities of $387 thousand each as investments in unconsolidated entities and records dividend income upon declaration by Trust I and Trust II.

XML

Derivative Instruments and Hedging Activities

9 Months Ended

Sep. 30, 2018

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments and Hedging Activities

Derivative Instruments and Hedging Activities

Derivative financial instruments involve, to varying degrees, interest rate, market and credit risk. Management manages these risks as part of its asset and liability management process and through credit policies and procedures. Management seeks to minimize counterparty credit risk by establishing credit limits and collateral agreements and utilizes certain derivative financial instruments to enhance its ability to manage interest rate risk that exists as part of its ongoing business operations. The derivative transactions entered into by the Corporation are an economic hedge of a derivative offerings to Bank customers. The Corporation does not use derivative financial instruments for trading purposes.

Customer Derivatives – Interest Rate Swaps. The Corporation enters into interest rate swaps that allow commercial loan customers to effectively convert a variable-rate commercial loan agreement to a fixed-rate commercial loan agreement. Under these agreements, the Corporation originates variable-rate loans with customers in addition to interest rate swap agreements, which serve to effectively swap the customers’ variable-rate loans into fixed-rate loans. The Corporation then enters into corresponding swap agreements with swap dealer counterparties to economically hedge its exposure on the variable and fixed components of the customer agreements. The interest rate swaps with both the customers and third parties are not designated as hedges under FASB ASC 815 and are marked to market through earnings. As the interest rate swaps are structured to offset each other, changes to the underlying benchmark interest rates considered in the valuation of these instruments do not result in an impact to earnings; however, there may be fair value adjustments related to credit quality variations between counterparties, which may impact earnings as required by FASB ASC 820. As of September 30, 2018, there were no fair value adjustments related to credit quality.

Risk Participation Agreements. The Corporation may enter into a risk participation agreement (“RPA”) with another institution as a means to assume a portion of the credit risk associated with a loan structure which includes a derivative instrument, in exchange for fee income commensurate with the risk assumed. This type of derivative is referred to as an “RPA sold.” In addition, in an effort to reduce the credit risk associated with an interest rate swap agreement with a borrower for whom the Corporation has provided a loan structured with a derivative, the Corporation may purchase an RPA from an institution participating in the facility in exchange for a fee commensurate with the risk shared. This type of derivative is referred to as an “RPA purchased.”

The following tables detail the derivative instruments as of September 30, 2018 and December 31, 2017:

	Asset Derivatives				Liability Derivatives
(dollars in thousands)	Notional Amount		Fair Value		Notional Amount		Fair Value
Derivatives not designated as hedging instruments
As of September 30, 2018:
Customer derivatives – interest rate swaps	$	295,566	$	5,843	$	295,566	$	5,843
RPAs sold	—		—		865		1
RPAs purchased	35,464		43		—		—
Total derivatives	$	331,030	$	5,886	$	296,431	$	5,844
As of December 31, 2017:
Customer derivatives – interest rate swaps	$	124,627	$	1,895	$	124,627	$	1,895
RPAs sold	—		—		899		3
RPAs purchased	14,710		21		—		—
Total derivatives	$	139,337	$	1,916	$	125,526	$	1,898

The Corporation has International Swaps and Derivatives Association agreements with third parties that requires a minimum dollar transfer amount upon a margin call. This requirement is dependent on certain specified credit measures. The amount of collateral posted with third parties at September 30, 2018 and December 31, 2017 was $420 thousand and $1.3 million, respectively. The amount of collateral posted with third parties is deemed to be sufficient to collateralize both the fair market value change as well as any additional amounts that may be required as a result of a change in the specified credit measures. The aggregate fair value of all derivative financial instruments in a liability position with credit measure contingencies and entered into with third parties was $1.8 million and $1.6 million as of September 30, 2018 and December 31, 2017, respectively.

XML

Accounting for Uncertainty in Income Taxes

9 Months Ended

Sep. 30, 2018

Income Tax Disclosure [Abstract]

Accounting for Uncertainty in Income Taxes

Accounting for Uncertainty in Income Taxes

The Corporation recognizes the financial statement benefit of a tax position only after determining that the Corporation would be more likely than not to sustain the position following an examination. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50% likelihood of being realized upon settlement with the relevant tax authority.

The Corporation is subject to income taxes in the United States federal jurisdiction and multiple state jurisdictions. The Corporation is no longer subject to U.S. federal income tax examination by taxing authorities for years before 2014.

The Corporation’s policy is to record interest and penalties on uncertain tax positions as income tax expense. No interest or penalties were accrued for the three or nine months ended September 30, 2018 or 2017.

XML

Shareholders' Equity

9 Months Ended

Sep. 30, 2018

Stockholders' Equity Note [Abstract]

Shareholders' Equity

Shareholders’ Equity

Dividend

On October 17, 2018, the Corporation’s Board of Directors declared a regular quarterly dividend of $0.25 per share payable December 1, 2018 to shareholders of record as of November 1, 2018. During the third quarter of 2018, the Corporation paid or accrued, as applicable, a regular quarterly dividend of $0.25 per share. This dividend totaled $5.1 million, based on outstanding shares and restricted stock units as of August 1, 2018 of 20,443,918 shares.

S-3 Shelf Registration Statement and Offerings Thereunder

In May 2018, the Corporation filed a shelf registration statement on Form S-3, SEC File No. 333-224849 (the “Shelf Registration Statement”). The Shelf Registration Statement allows the Corporation to raise additional capital from time to time through offers and sales of registered securities consisting of common stock, debt securities, warrants, purchase contracts, rights and units or units consisting of any combination of the foregoing securities. The Corporation may sell these securities using the prospectus in the Shelf Registration Statement, together with applicable prospectus supplements, from time to time, in one or more offerings.

In addition, the Corporation has in place a Dividend Reinvestment and Stock Purchase Plan (the “Plan”), which allows it to issue up to 1,500,000 shares of registered common stock. The Plan allows for the grant of a request for waiver (“RFW”) above the Plan’s maximum investment of $120 thousand per account per year. A RFW is granted based on a variety of factors, including the Corporation’s current and projected capital needs, prevailing market prices of the Corporation’s common stock and general economic and market conditions.

For the three and nine months ended September 30, 2018, the Corporation did not issue any shares under the Plan. No RFWs were approved during the three and nine months ended September 30, 2018. No other sales of equity securities were executed under the Shelf Registration Statement during the three and nine months ended September 30, 2018.

Option Exercises and Vesting of Restricted Stock Units ("RSUs") and Performance Stock Units ("PSUs")

In addition to shares that may be issued through the Plan, the Corporation also issues shares through the exercise of stock options and the vesting of RSUs and PSUs. During the three and nine months ended September 30, 2018, 15,150 shares and 63,825 shares, respectively, were issued pursuant to the exercise of stock options, increasing shareholders’ equity by $349 thousand and $1.5 million, respectively. The increase in shareholders’ equity related to the vesting of RSUs and PSUs, which is recognized over the vesting period through stock based compensation expense, was $708 thousand and $1.9 million for the three and nine months ended September 30, 2018, respectively.

Stock Repurchases

On August 6, 2015, the Corporation announced a stock repurchase program (the “2015 Program”) under which the Corporation may repurchase up to 1,200,000 shares of the Corporation’s common stock, at an aggregate purchase price not to exceed $40 million. During the three months ended September 30, 2018, 14,263 shares were repurchased under the 2015 Program. As of September 30, 2018, the maximum number of shares remaining authorized for repurchase under the 2015 Program was 175,037. In addition to the 2015 Program, it is the Corporation’s practice to retire shares to its treasury account upon the vesting of stock awards to certain officers in order to cover the statutory income tax withholdings related to such vestings.

XML

Accumulated Other Comprehensive (Loss) Income

9 Months Ended

Sep. 30, 2018

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Accumulated Other Comprehensive (Loss) Income

Accumulated Other Comprehensive (Loss) Income

The following table details the components of accumulated other comprehensive (loss) income for the three and nine month periods ended September 30, 2018 and 2017:

(dollars in thousands)	Net Change in Unrealized Gains on Available-for- Sale Investment Securities			Net Change in Unfunded Pension Liability			Accumulated Other Comprehensive Loss
Balance, June 30, 2018	$	(9,669	)	$	(1,522	)	$	(11,191	)
Other comprehensive (loss) income	(2,319		)	108			(2,211		)
Balance, September 30, 2018	$	(11,988	)	$	(1,414	)	$	(13,402	)
Balance, June 30, 2017	$	(433	)	$	(1,131	)	$	(1,564	)
Other comprehensive income	149			15			164
Balance, September 30, 2017	$	(284	)	$	(1,116	)	$	(1,400	)

(dollars in thousands)	Net Change in Unrealized Gains on Available-for- Sale Investment Securities			Net Change in Unfunded Pension Liability			Accumulated Other Comprehensive Loss
Balance, December 31, 2017	$	(2,861	)	$	(1,553	)	$	(4,414	)
Other comprehensive (loss) income	(9,127		)	139			(8,988		)
Balance, September 30, 2018	$	(11,988	)	$	(1,414	)	$	(13,402	)
Balance, December 31, 2016	$	(1,231	)	$	(1,178	)	$	(2,409	)
Other comprehensive income	947			62			1,009
Balance, September 30, 2017	$	(284	)	$	(1,116	)	$	(1,400	)

The following table details the amounts reclassified from each component of accumulated other comprehensive loss to each component’s applicable income statement line, for the three and nine month periods ended September 30, 2018 and 2017:

	Amount Reclassified from Accumulated Other Comprehensive Loss
Description of Accumulated Other Comprehensive Loss Component	Three Months Ended September 30,				Affected Income Statement Category
	2018		2017
Net unrealized gain on investment securities available for sale:
Realization of gain on sale of investment securities available for sale	$	—	$	72	Net gain on sale of available for sale investment securities
Realization of gain on transfer of investment securities available for sale to trading	—		—		Other operating income
Total	$	—	$	72
Income tax effect	—		25		Income tax expense
Net of income tax	$	—	$	47	Net income
Unfunded pension liability:
Amortization of net loss included in net periodic pension costs*	$	25	$	24	Other operating expenses
Income tax effect	5		8		Income tax expense
Net of income tax	$	20	$	16	Net income

	Amount Reclassified from Accumulated Other Comprehensive Loss
Description of Accumulated Other Comprehensive Loss Component	Nine Months Ended September 30,				Affected Income Statement Category
	2018		2017
Net unrealized gain on investment securities available for sale:
Realization of gain on sale of investment securities available for sale	$	7	$	73	Net gain on sale of available for sale investment securities
Realization of gain on transfer of investment securities available for sale to trading	417		—		Other operating income
Total	$	424	$	73
Income tax effect	89		27		Income tax expense
Net of income tax	$	335	$	46	Net income
Unfunded pension liability:
Amortization of net loss included in net periodic pension costs*	$	75	$	71	Other operating expenses
Income tax effect	15		25		Income tax expense
Net of income tax	$	60	$	46	Net income

*Accumulated other comprehensive loss components are included in the computation of net periodic pension cost.

XML

Earnings per Common Share

9 Months Ended

Sep. 30, 2018

Earnings Per Share [Abstract]

Earnings per Common Share

Earnings per Common Share

Basic earnings per common share excludes dilution and is computed by dividing income available to common shareholders by the weighted-average common shares outstanding during the period. Diluted earnings per common share takes into account the potential dilution that would occur if in-the-money stock options were exercised and converted into common shares and RSUs and PSUs were vested. Proceeds assumed to have been received on option exercises are assumed to be used to purchase shares of the Corporation’s common stock at the average market price during the period, as required by the treasury stock method of accounting. The effects of stock options are excluded from the computation of diluted earnings per share in periods in which the effect would be antidilutive.

	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands except share and per share data)	2018		2017		2018		2017
Numerator:
Net income available to common shareholders	$	16,682	$	10,739	$	46,656	$	29,216
Denominator for basic earnings per share – weighted average shares outstanding	20,270,706		17,023,046		20,237,757		16,987,499
Effect of dilutive common shares	167,670		230,936		206,318		254,728
Denominator for diluted earnings per share – adjusted weighted average shares outstanding	20,438,376		17,253,982		20,444,075		17,242,227
Basic earnings per share	$	0.82	$	0.63	$	2.31	$	1.72
Diluted earnings per share	$	0.82	$	0.62	$	2.28	$	1.69
Antidilutive shares excluded from computation of average dilutive earnings per share	22,232		21,621		48,807		47,268

XML

Revenue from Contracts with Customers

9 Months Ended

Sep. 30, 2018

Revenue from Contract with Customer [Abstract]

Revenue from Contracts with Customers

Revenue from Contracts with Customers

All of the Corporation’s revenue from contracts with customers in the scope of ASC 606 is recognized within noninterest income.  The following table presents the Corporation’s noninterest income by revenue stream and reportable segment for the three and nine months ended September 30, 2018 and 2017.  Items outside the scope of ASC 606 are noted as such.

	Three Months Ended September 30, 2018						Three Months Ended September 30, 2017
(dollars in thousands)	Banking		Wealth Management		Consolidated		Banking		Wealth Management		Consolidated
Fees for wealth management services	$	—	$	10,343	$	10,343	$	—	$	9,651	$	9,651
Insurance commissions	—		1,754		1,754		—		1,373		1,373
Capital markets revenue(1)	710		—		710		843		—		843
Service charges on deposit accounts	726		—		726		676		—		676
Loan servicing and other fees(1)	559		—		559		548		—		548
Net gain on sale of loans(1)	631		—		631		799		—		799
Net gain on sale of investment securities available for sale(1)	—		—		—		72		—		72
Net gain on sale of other real estate owned	5		—		5		—		—		—
Dividends on FHLB and FRB stock(1)	375		—		375		217		—		217
Other operating income(2)	3,123		48		3,171		1,364		41		1,405
Total noninterest income	$	6,129	$	12,145	$	18,274	$	4,519	$	11,065	$	15,584

(1) Not within the scope of ASC 606.

(2) Other operating income includes Visa debit card income, safe deposit box rentals, and rent income totaling $595 thousand and $520 thousand for the three months ended September 30, 2018 and 2017, respectively, which are within the scope of ASC 606.

	Nine Months Ended September 30, 2018						Nine Months Ended September 30, 2017
(dollars in thousands)	Banking		Wealth Management		Consolidated		Banking			Wealth Management		Consolidated
Fees for wealth management services	$	—	$	31,309	$	31,309	$	—		$	28,761	$	28,761
Insurance commissions	—		5,349		5,349		—			3,079		3,079
Capital markets revenue(1)	3,481		—		3,481		1,796			—		1,796
Service charges on deposit accounts	2,191		—		2,191		1,953			—		1,953
Loan servicing and other fees(1)	1,720		—		1,720		1,570			—		1,570
Net gain on sale of loans(1)	1,677		—		1,677		1,948			—		1,948
Net gain on sale of investment securities available for sale(1)	7		—		7		73			—		73
Net gain (loss) on sale of other real estate owned	292		—		292		(12		)	—		(12		)
Dividends on FHLB and FRB stock(1)	1,316		—		1,316		649			—		649
Other operating income(2)	10,393		150		10,543		3,641			138		3,779
Total noninterest income	$	21,077	$	36,808	$	57,885	$	11,618		$	31,978	$	43,596

(1) Not within the scope of ASC 606.

(2) Other operating income includes Visa debit card income, safe deposit box rentals, and rent income totaling $1.7 million and $1.5 million for the nine months ended September 30, 2018 and 2017, respectively, which are within the scope of ASC 606.

A description of the Corporation’s revenue streams accounted for under ASC 606 follows:

Service Charges on Deposit Accounts: The Corporation earns fees from its deposit customers for transaction-based, account maintenance, and overdraft services. Transaction-based fees, which include services such as ATM use fees, stop payment charges, statement rendering, and ACH fees, are recognized at the time the transaction is executed as that is the point in time the Corporation fulfills the customer’s request. Account maintenance fees, which relate primarily to monthly maintenance, are earned over the course of a month, representing the period over which the Corporation satisfies the performance obligation. Overdraft fees are recognized at the point in time that the overdraft occurs. Service charges on deposits are withdrawn from the customer’s account balance.

Wealth Management Fees: The Corporation earns wealth management fee revenue from a variety of sources including fees from trust administration and other related fiduciary services, custody, investment management and advisory services, employee benefit account and IRA administration, estate settlement, tax service fees, shareholder service fees and brokerage.

Fees that are determined based on the market value of the assets held in their accounts are generally billed monthly, in arrears, based on the market value of assets at the end of the previous billing period. Other related services that are based on a fixed fee schedule are recognized when the services are rendered. Fees that are transaction based, including trade execution services, are recognized at the point in time that the transaction is executed, i.e. the trade date.

Included in other assets on the balance sheet is a receivable for wealth management fees that have been earned but not yet collected.

Insurance Commissions: The Corporation earns commissions from the sale of insurance policies, which are generally calculated as a percentage of the policy premium, and contingent income, which is calculated based on the volume and performance of the policies held by each carrier. Obligations for the sale of insurance policies are generally satisfied at the point in time which the policy is executed and are recognized at the point in time in which the amounts are knownand collection is reasonably assured. Performance metrics for contingent income are generally satisfied over time, not exceeding one year, and are recognized at the point in time in which the amounts are known and collection is reasonably assured.

Visa Debit Card Income: The Corporation earns income fees from debit cardholder transactions conducted through the Visa payment network. Fees from cardholder transactions represent a percentage of the underlying transaction value and are recognized daily, concurrently with the transaction processing services provided to the cardholder.

Gains/Losses on Sales of OREO: The Corporation records a gain or loss from the sale of OREO when control of the property transfers to the buyer, which generally occurs at the time of an executed deed.

XML

Stock-Based Compensation

9 Months Ended

Sep. 30, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Compensation

Stock-Based Compensation

A. General Information

The Corporation permits the issuance of stock options, dividend equivalents, performance stock awards, stock appreciation rights and restricted stock units or awards to employees and directors of the Corporation under several plans. The performance awards and restricted awards may be in the form of stock awards or stock units. Stock awards and stock units differ in that for a stock award, shares of restricted stock are issued in the name of the grantee, whereas a stock unit constitutes a promise to issue shares of stock upon vesting. The accounting for awards and units is identical. The terms and conditions of awards under the plans are determined by the Corporation’s Management Development and Compensation Committee.

Prior to April 25, 2007, all shares authorized for grant as stock-based compensation were limited to grants of stock options. On April 25, 2007, the shareholders approved the Corporation’s “2007 Long-Term Incentive Plan” (the “2007 LTIP”) under which a total of 428,996 shares of the Corporation’s common stock were made available for award grants. On April 28, 2010, the shareholders approved the Corporation’s “2010 Long Term Incentive Plan” under which a total of 445,002 shares of the Corporation’s common stock were made available for award grants and on April 30, 2015, the shareholders approved an amendment and restatement of such plan (as amended and restated, the “2010 LTIP”) to, among other things, increase the number of shares available for award grants by 500,000 to 945,002.

In addition to the shareholder-approved plans mentioned in the preceding paragraph, the Corporation periodically authorizes grants of stock-based compensation as inducement awards to new employees. This type of award does not require shareholder approval in accordance with Rule 5635(c)(4) of the NASDAQ listing rules.

The equity awards are authorized to be in the form of, among others, options to purchase the Corporation’s common stock, RSUs and PSUs.

RSUs have a restriction based on the passage of time. The grant date fair value of the RSUs is based on the closing price on the date of the grant.

PSUs have restrictions based on performance criteria and the passage of time. The performance criteria may be a market-based criteria measured by the Corporation’s total shareholder return (“TSR”) relative to the performance of the community bank index for the respective period. The fair value of the PSUs based on the Corporation’s TSR relative to the performance of a designated peer group or the NASDAQ Community Bank Index is calculated using the Monte Carlo Simulation method. The performance criteria may also be based on a non-market-based criteria such as return on average equity relative to that designated peer group. The grant date fair value of these PSUs is based on the closing price of the Corporation’s stock on the date of the grant. PSU grants may have a vesting percent ranging from 0% to 150%.

B. Other Stock Option Information

The following table provides information about options outstanding for the three months ended September 30, 2018:

	Shares		Weighted Average Exercise Price		Weighted Average Grant Date Fair Value
Options outstanding, June 30, 2018	66,571		$	19.26	$	4.71
Forfeited	—		—		—
Expired	—		—		—
Exercised	(15,150	)	$	23.02	$	5.09
Options outstanding, September 30, 2018	51,421		$	18.15	$	4.60

The following table provides information about options outstanding for the nine months ended September 30, 2018:

	Shares		Weighted Average Exercise Price		Weighted Average Grant Date Fair Value
Options outstanding, December 31, 2017	115,246		$	20.73	$	4.86
Forfeited	—		—		—
Expired	—		—		—
Exercised	(63,825	)	$	22.81	$	5.06
Options outstanding, September 30, 2018	51,421		$	18.15	$	4.60

As of September 30, 2018 there were no unvested options.

Proceeds, related tax benefits realized from options exercised and intrinsic value of options exercised were as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2018		2017		2018		2017
Proceeds from exercise of stock options	$	349	$	283	$	1,456	$	1,288
Related tax benefit recognized	81		96		312		402
Net proceeds of options exercised	$	430	$	379	$	1,768	$	1,690
Intrinsic value of options exercised	$	386	$	273	$	1,484	$	1,147

The following table provides information about options outstanding and exercisable at September 30, 2018:

(dollars in thousands, except share data and exercise price)	Outstanding		Exercisable
Number of shares	51,421		51,421
Weighted average exercise price	$	18.15	$	18.15
Aggregate intrinsic value	$	1,478	$	1,478
Weighted average remaining contractual term in years	0.9		0.9

C. Restricted Stock Units and Performance StockUnits

The Corporation has granted RSUs and PSUs under the 2007 LTIP and 2010 LTIP and in accordance with Rule 5635(c)(4) of the NASDAQ listing standards.

RSUs

The compensation expense for the RSUs is measured based on the market price of the stock on the day prior to the grant date and is recognized on a straight-line basis over the vesting period.

For the three and nine months ended September 30, 2018, the Corporation recognized $318 thousand and $873 thousand, respectively, of expense related to the Corporation’s RSUs. As of September 30, 2018, there was $2.3 million of unrecognized compensation cost related to RSUs. This cost will be recognized over a weighted average period of 2.3 years.

The following table details the RSUs for the three and nine months ended September 30, 2018:

	Three Months Ended September 30, 2018				Nine Months Ended September 30, 2018
	Number of Shares		Weighted Average Grant Date Fair Value		Number of Shares		Weighted Average Grant Date Fair Value
Beginning balance	68,595		$	36.89	75,707		$	35.80
Granted	23,843		$	46.29	26,243		$	46.07
Vested	(16,122	)	$	33.65	(24,469	)	$	32.16
Forfeited	—		$	—	(1,165	)	$	35.36
Ending balance	76,316		$	40.51	76,316		$	40.51

PSUs

For the three and nine months ended September 30, 2018, the Corporation recognized $390 thousand and $1.1 million, respectively, of expense related to the PSUs. As of September 30, 2018, there was $3.3 million of unrecognized compensation cost related to PSUs. This cost will be recognized over a weighted average period of 2.2 years.

The following table details the PSUs for the three and nine months ended September 30, 2018:

	Three Months Ended September 30, 2018				Nine Months Ended September 30, 2018
	Number of Shares		Weighted Average Grant Date Fair Value		Number of Shares		Weighted Average Grant Date Fair Value
Beginning balance	130,260		$	26.73	168,453		$	24.76
Granted	40,722		$	44.56	40,722		$	44.56
Vested	(48,056	)	$	16.04	(81,840	)	$	16.40
Forfeited	—		$	—	(4,409	)	$	26.57
Ending balance	122,926		$	36.82	122,926		$	36.82

XML

Fair Value Measurement

9 Months Ended

Sep. 30, 2018

Fair Value Disclosures [Abstract]

Fair Value Measurement

Fair Value Measurement

FASB ASC 820, “Fair Value Measurements and Disclosures,” defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosures about fair value measurements. FASB ASC 820 also establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).

The three levels of the fair value hierarchy under FASB ASC Topic 820 are:

Level 1 – Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

Level 2 – Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active and model derived valuations whose inputs are observable or whose significant value drivers are observable.

Level 3 – Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity).

A.Assets and liabilities measured on a recurring basis

A description of the valuation methodologies used for financial instruments measured at fair value on a recurring basis, as well as the general classification of such instruments pursuant to the valuation hierarchy, is set forth below. 

Investment Securities

The value of the Corporation’s available for sale investment securities, which include obligations of the U.S. government and its agencies, mortgage-backed securities issued by U.S. government- and U.S. government sponsored agencies, obligations of state and political subdivisions, corporate bonds and other debt securities are determined by the Corporation, taking into account the input of an independent third party valuation service provider. The third party’s evaluations are based on market data, utilizing pricing models that vary by asset and incorporate available trade, bid and other market information. For securities that do not trade on a daily basis, their pricing models apply available information such as benchmarking and matrix pricing. The market inputs normally sought in the evaluation of securities include benchmark yields, reported trades, broker/dealer quotes (only obtained from market makers or broker/dealers recognized as market participants), issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data. For certain securities, additional inputs may be used or some market inputs may not be applicable. Inputs are prioritized differently on any given day based on market conditions. Management reviews, annually, the process utilized by its independent third-party valuation service provider. On a quarterly basis, management tests the validity of the prices provided by the third party by selecting a representative sample of the portfolio and obtaining actual trade results, or if actual trade results are not available, competitive broker pricing. On an annual basis, management evaluates, for appropriateness, the methodology utilized by the independent third-party valuation service provider.

U.S. Government agencies are evaluated and priced using multi-dimensional relational models and option adjusted spreads. State and municipal securities are evaluated on a series of matrices including reported trades and material event notices. Mortgage-backed securities are evaluated using matrix correlation to treasury or floating index benchmarks, prepayment speeds, monthly payment information and other benchmarks. Other available-for-sale investments are evaluated using a broker-quote based application, including quotes from issuers.

Interest Rate Swaps and Risk Participation Agreements 

The Corporation’s interest rate swaps and RPAs are reported at fair value utilizing Level 2 inputs. Prices of these instruments are obtained through an independent pricing source utilizing pricing information which may include market observed quotations for swaps, LIBOR rates, forward rates and rate volatility. When entering into a derivative contract, the Corporation is exposed to fair value changes due to interest rate movements, and the potential non-performance of our contract counterparty. The Corporation has developed a methodology to value the non-performance risk based on internal credit risk metrics and the unique characteristics of derivative instruments, which include notional exposure rather than principle at risk and interest payment netting. The results of this methodology are used to adjust the base fair value of the instrument for the potential counterparty credit risk.

The following tables present the Corporation’s assets measured at fair value on a recurring basis as of September 30, 2018 and December 31, 2017:

As of September 30, 2018
(dollars in thousands)	Total		Level 1		Level 2		Level 3
Investment securities available for sale:
U.S. Treasury securities	$	100	$	100	$	—	$	—
Obligations of U.S. government & agencies	190,453		—		190,453		—
Obligations of state & political subdivisions	15,799		—		15,799		—
Mortgage-backed securities	284,421		—		284,421		—
Collateralized mortgage obligations	36,193		—		36,193		—
Other investment securities	1,098		—		1,098		—
Total investment securities available for sale	$	528,064	$	100	$	527,964	$	—
Investment securities trading:
Mutual funds	$	8,340	$	8,340	$	—	$	—
Derivatives:
Interest rate swaps	$	5,886	$	—	$	5,886	$	—
Total recurring fair value measurements	$	542,290	$	8,440	$	533,850	$	—

As of December 31, 2017
(dollars in thousands)	Total		Level 1		Level 2		Level 3
Investment securities available for sale:
U.S. Treasury securities	$	200,088	$	200,088	$	—	$	—
Obligations of U.S. government & agencies	151,044		—		151,044		—
Obligations of state & political subdivisions	21,310		—		21,310		—
Mortgage-backed securities	274,990		—		274,990		—
Collateralized mortgage obligations	36,662		—		36,662		—
Mutual funds	3,509		3,509		—		—
Other investment securities	1,599		—		1,599		—
Total investment securities available for sale	$	689,202	$	203,597	$	485,605	$	—
Investment securities trading:
Mutual funds	$	4,610	$	4,610	$	—	$	—
Derivatives:
Interest rate swaps	$	1,898	$	—	$	1,898	$	—
Total recurring fair value measurements	$	695,710	$	208,207	$	487,503	$	—

There have been no transfers between levels during the three and nine months ended September 30, 2018.

B.Assets and liabilities measured on anon-recurring basis

Fair value is used on a nonrecurring basis to evaluate certain financial assets and financial liabilities in specific circumstances.  Similarly, fair value is used on a nonrecurring basis for nonfinancial assets and nonfinancial liabilities such as foreclosed assets, OREO, intangible assets, nonfinancial assets and liabilities evaluated in a goodwill impairment analysis and other nonfinancial assets measured at fair value for purposes of assessing impairment.  A description of the valuation methodologies used for financial and nonfinancial assets and liabilities measured at fair value, as well as the general classification of such assets and liabilities pursuant to the valuation hierarchy, is set forth below.

Impaired Loans

Management evaluates and values impaired loans at the time the loan is identified as impaired, and the fair values of such loans are estimated using Level 3 inputs in the fair value hierarchy. Each loan’s collateral has a unique appraisal and management’s discount of the value is based on the factors unique to each impaired loan. The significant unobservable input in determining the fair value is management’s subjective discount on appraisals of the collateral securing the loan, which range from 10% - 50%. Collateral may consist of real estate and/or business assets including equipment, inventory and/or accounts receivable and the value of these assets is determined based on the appraisals by qualified licensed appraisers hired by the Corporation. Appraised and reported values may be discounted based on management’s historical knowledge, changes in market conditions from the time of valuation, estimated costs to sell, and/or management’s expertise and knowledge of the client and the client’s business.

The Corporation has an appraisal policy in which an appraisal is obtained for a commercial loan at the point at which the loan either becomes nonperforming or is downgraded to a substandard or worse classification. For consumer loans, management obtains updated appraisals when a loan becomes 90 days past due or when it receives other information that may indicate possible impairment. Based on the appraisals obtained by the Corporation, a partial or full charge-off may be necessary. 

Other Real Estate Owned

OREO consists of properties acquired as a result of foreclosures and deeds in-lieu-of foreclosure. Properties classified as OREO are reported at the lower of cost or fair value less cost to sell, and are classified as Level 3 in the fair value hierarchy.

Mortgage Servicing Rights

The model to value MSRs estimates the present value of projected net servicing cash flows of the remaining servicing portfolio based on various assumptions, including changes in anticipated loan prepayment rates, the discount rate, reflective of a market participant's required return on an investment for similar assets, and other market-based economic factors. All of these assumptions are considered to be unobservable inputs. Accordingly, MSRs are classified within Level 3 of the fair value hierarchy.

The following tables present the Corporation’s assets measured at fair value on a non-recurring basis as of September 30, 2018 and December 31, 2017:

As of September 30, 2018
(dollars in thousands)	Total		Level 1		Level 2		Level 3
MSRs	$	6,586	$	—	$	—	$	6,586
Impaired loans and leases	12,593		—		—		12,593
OREO	529		—		—		529
Total non-recurring fair value measurements	$	19,708	$	—	$	—	$	19,708

As of December 31, 2017
(dollars in thousands)	Total		Level 1		Level 2		Level 3
MSRs	$	6,397	$	—	$	—	$	6,397
Impaired loans and leases	13,954		—		—		13,954
OREO	304		—		—		304
Total non-recurring fair value measurements	$	20,655	$	—	$	—	$	20,655

During the three and nine months ended September 30, 2018, a decrease of $148 thousand and an increase of $20 thousand, respectively, were recorded in the Allowance as a result of adjusting the carrying value and estimated fair value of the impaired loans in the above tables.

XML

Fair Value of Financial Instruments

9 Months Ended

Sep. 30, 2018

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

Fair Value of Financial Instruments

FASB ASC 825, “Disclosures about Fair Value of Financial Instruments” requires disclosure of the fair value information about financial instruments, whether or not recognized in the balance sheet, for which it is practicable to estimate such value. The methodologies for estimating the fair value of financial assets and financial liabilities measured at fair value on a recurring and non-recurring basis are discussed above. The estimated fair value amounts have been determined by management using available market information and appropriate valuation methodologies, are based on the exit price notion set forth by ASU 2016-1 effective January 1, 2018, and are applied to this disclosure on a prospective basis. Estimated fair value of assets and liabilities carried at cost as of December 31, 2017 were based on an entry price notion. In cases where quoted market prices are not available, fair values are based on estimates using present value or other market value 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. The aggregate fair value amounts presented below do not represent the underlying value of the Corporation.

The carrying amount and fair value of the Corporation’s financial instruments are as follows:

		As of September 30, 2018				As of December 31, 2017
(dollars in thousands)	Fair Value Hierarchy Level*	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Financial assets:
Cash and cash equivalents	Level 1	$	45,354	$	45,354	$	60,024	$	60,024
Investment securities - available for sale	See Note 19	528,064		528,064		689,202		689,202
Investment securities - trading	See Note 19	8,340		8,340		4,610		4,610
Investment securities – held to maturity	Level 2	8,916		8,544		7,932		7,851
Loans held for sale	Level 2	4,111		4,111		3,794		3,794
Net portfolio loans and leases	Level 3	3,362,791		3,362,757		3,268,333		3,293,802
MSRs	Level 3	5,328		6,586		5,861		6,397
Interest rate swaps	Level 2	5,843		5,843		1,895		1,895
RPAs purchased	Level 2	43		43		21		21
Other assets	Level 3	44,439		44,439		46,799		46,799
Total financial assets		$	4,013,229	$	4,014,081	$	4,088,471	$	4,114,395
Financial liabilities:
Deposits	Level 2	$	3,357,226	$	3,351,183	$	3,373,798	$	3,368,276
Short-term borrowings	Level 2	226,498		226,498		237,865		237,865
Long-term FHLB advances	Level 2	72,841		71,978		139,140		138,685
Subordinated notes	Level 2	98,482		97,892		98,416		95,044
Junior subordinated debentures	Level 2	21,538		23,564		21,416		19,366
Interest rate swaps	Level 2	5,843		5,843		1,895		1,895
RPAs sold	Level 2	1		1		3		3
Other liabilities	Level 3	60,432		60,432		49,071		49,071
Total financial liabilities		$	3,842,861	$	3,837,391	$	3,921,604	$	3,910,205

* See Note 19 in the Notes to Unaudited Consolidated Financial Statements above for a description of hierarchy levels.

XML

Financial Instruments With Off-Balance Sheet Risk, Contingencies and Concentration of Credit Risk

9 Months Ended

Sep. 30, 2018

Commitments and Contingencies Disclosure [Abstract]

Financial Instruments With Off-Balance Sheet Risk, Contingencies and Concentration of Credit Risk

 Financial Instruments with Off-Balance Sheet Risk, Contingencies and Concentration of Credit Risk

Off-Balance Sheet Arrangements

The Corporation 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 include commitments to extend credit and standby letters of credit. Those instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the consolidated statements of financial condition. The contractual amounts of those instruments reflect the extent of involvement the Corporation has in particular classes of financial instruments.

The Corporation’s exposure to credit loss in the event of nonperformance by the counterparty to the financial instrument of commitments to extend credit and standby letters of credit is represented by the contractual amount of those instruments. The Corporation uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet financial instruments.

Commitments to extend credit, which include unused lines of credit and unfunded commitments to originate loans, are agreements to lend to a customer as long as there is no violation of any condition established in the agreement. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Some of the commitments are expected to expire without being drawn upon, and the total commitment amounts do not necessarily represent future cash requirements. Total commitments to extend credit at September 30, 2018 and December 31, 2017 were $764.7 million and $748.3 million, respectively. Management evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Corporation upon extension of credit, is based on a credit evaluation of the counterparty. Collateral varies but may include accounts receivable, marketable securities, inventory, property, plant and equipment, residential real estate, and income-producing commercial properties.

Standby letters of credit are conditional commitments issued by the Bank to a customer for a third party. Such standby letters of credit are issued to support private borrowing arrangements. The credit risk involved in issuing standby letters of credit is similar to that involved in extending loan facilities to customers. The collateral varies, but may include accounts receivable, marketable securities, inventory, property, plant and equipment, and residential real estate for those commitments for which collateral is deemed necessary. The Corporation’s obligations under standby letters of credit as of September 30, 2018 and December 31, 2017 were $21.2 million and $17.7 million, respectively.

Contingencies

Legal Matters

In the ordinary course of its operations, the Corporation and its subsidiaries are parties to various claims, litigation, investigations, and legal and administrative cases and proceedings.  Such pending or threatened claims, litigation, investigations, legal and administrative cases and proceedings typically entail matters that are considered ordinary routine litigation incidental to our business. Claims for significant monetary damages may be asserted in many of these types of legal actions. Based on the information currently available, management believes it has meritorious defenses to the claims asserted against it in its currently outstanding legal proceedings and with respect to such legal proceedings, intends to continue to defend itself vigorously, litigating or settling cases according to management’s judgment as to what is in the best interests of the Corporation and its shareholders.

On a regular basis, liabilities and contingencies in connection with outstanding legal proceedings are assessed utilizing the latest information available. For those matters where it is probable that the Corporation will incur a loss and the amount of the loss can be reasonably estimated, a liability may be recorded in the Consolidated Financial Statements. These legal reserves may be increased or decreased to reflect any relevant developments on at least a quarterly basis. For other matters, where a loss is not probable or the amount or range of the loss is not estimable, legal reserves are not accrued. While the outcome of legal proceedings is inherently uncertain, based on information currently available, advice of counsel and available insurance coverage, management believes that the established legal reserves are adequate and the liabilities arising from legal proceedings will not have a material adverse effect on the consolidated financial position, consolidated results of operations or consolidated cash flows. However, in the event of unexpected future developments, it is possible that the ultimate resolution of these matters, if unfavorable, may be material to the consolidated financial position, consolidated results of operations or consolidated cash flows of the Corporation.

Indemnifications

In general, the Corporation does not sell loans with recourse, except to the extent that it arises from standard loan-sale contract provisions. These provisions cover violations of representations and warranties and, under certain circumstances, first payment default by borrowers. These indemnifications may include the repurchase of loans by the Corporation, and are considered customary provisions in the secondary market for conforming mortgage loan sales. Repurchases and losses have been rare and no provision is made for losses at the time of sale. There were no such repurchases for the three or nine months ended September 30, 2018.

Concentrations of Credit Risk

The Corporation has a material portion of its loans in real estate-related loans. A predominant percentage of the Corporation’s real estate exposure, both commercial and residential, is in the Corporation’s primary trade area which includes portions of Delaware, Chester, Montgomery and Philadelphia counties in Southeastern Pennsylvania. Management is aware of this concentration and attempts to mitigate this risk to the extent possible in many ways, including the underwriting and assessment of borrower’s capacity to repay. See Note 5 – “Loans and Leases” for additional information.

XML

Segment Information

9 Months Ended

Sep. 30, 2018

Segment Reporting [Abstract]

Segment Information

Segment Information

FASB Codification 280 – “Segment Reporting” identifies operating segments as components of an enterprise which are evaluated regularly by the Corporation’s chief operating decision maker, our Chief Executive Officer, in deciding how to allocate resources and assess performance. The Corporation has applied the aggregation criterion set forth in this codification to the results of its operations.

The Corporation’s Banking segment consists of commercial and retail banking. The Banking segment is evaluated as a single strategic unit which generates revenues from a variety of products and services. The Banking segment generates interest income from its lending (including leases) and investing activities and is dependent on the gathering of lower cost deposits from its branch network or borrowed funds from other sources for funding its loans, resulting in the generation of net interest income. The Banking segment also derives revenues from other sources including gains on the sale in available for sale investment securities, gains on the sale of residential mortgage loans, service charges on deposit accounts, cash sweep fees, overdraft fees, BOLI income and revenue associated with its Visa Check Card offering. Also included in the Banking segment are two subsidiaries of the Bank, KCMI Capital, Inc. and Bryn Mawr Equipment Financing, Inc., both of which provide specialized lending solutions to our customers.

The Wealth Management segment has responsibility for a number of activities within the Corporation, including trust administration, other related fiduciary services, custody, investment management and advisory services, employee benefits and IRA administration, estate settlement, tax services and brokerage. Bryn Mawr Trust of Delaware and Lau Associates are included in the Wealth Management segment of the Corporation since they have similar economic characteristics, products and services to those of the Wealth Management Division of the Corporation. BMT Investment Advisers, formed in May 2017, which serves as investment adviser to BMT Investment Funds, a Delaware statutory trust, is also reported under the Wealth Management segment. In addition, the Wealth Management Division oversees all insurance services of the Corporation, which are conducted through the Bank’s insurance subsidiary, BMT Insurance Advisors, Inc., and are reported in the Wealth Management segment.

The accounting policies of the Corporation are applied by segment in the following tables. The segments are presented on a pre-tax basis.

The following tables detail the Corporation’s segments for the three and nine months ended September 30, 2018 and 2017:

	Three Months Ended September 30, 2018									Three Months Ended September 30, 2017
(dollars in thousands)	Banking			Wealth Management			Consolidated			Banking			Wealth Management			Consolidated
Net interest income	$	36,726		$	3		$	36,729		$	29,437		$	1		$	29,438
Provision for loan and lease losses	664			—			664			1,333			—			1,333
Net interest income after loan loss provision	36,062			3			36,065			28,104			1			28,105
Noninterest income:
Fees for wealth management services	—			10,343			10,343			—			9,651			9,651
Insurance commissions	—			1,754			1,754			—			1,373			1,373
Capital markets revenue	710			—			710			843			—			843
Service charges on deposit accounts	726			—			726			676			—			676
Loan servicing and other fees	559			—			559			548			—			548
Net gain on sale of loans	631			—			631			799			—			799
Net gain on sale of investment securities available for sale	—			—			—			72			—			72
Net gain on sale of OREO	5			—			5			—			—			—
Other operating income	3,498			48			3,546			1,581			41			1,622
Total noninterest income	6,129			12,145			18,274			4,519			11,065			15,584
Noninterest expenses:
Salaries & wages	11,737			4,791			16,528			9,130			4,472			13,602
Employee benefits	2,394			962			3,356			1,587			973			2,560
Occupancy and bank premises	2,224			493			2,717			2,049			436			2,485
Amortization of intangible assets	386			505			891			197			480			677
Professional fees	889			108			997			681			58			739
Other operating expenses	7,770			1,333			9,103			6,970			1,151			8,121
Total noninterest expenses	25,400			8,192			33,592			20,614			7,570			28,184
Segment profit	16,791			3,956			20,747			12,009			3,496			15,505
Intersegment (revenues) expenses*	(186		)	186			—			(112		)	112			—
Pre-tax segment profit after eliminations	$	16,605		$	4,142		$	20,747		$	11,897		$	3,608		$	15,505
% of segment pre-tax profit after eliminations	80.0		%	20.0		%	100.0		%	76.7		%	23.3		%	100.0		%
Segment assets (dollars in millions)	$	4,335.8		$	52.6		$	4,388.4		$	3,424.8		$	52.0		$	3,476.8

	Nine Months Ended September 30, 2018									Nine Months Ended September 30, 2017
(dollars in thousands)	Banking			Wealth Management			Consolidated			Banking			Wealth Management			Consolidated
Net interest income	$	111,479		$	5		$	111,484		$	84,804		$	2		$	84,806
Provision for loan and lease losses	4,831			—			4,831			1,541			—			1,541
Net interest income after loan loss provision	106,648			5			106,653			83,263			2			83,265
Noninterest income:
Fees for wealth management services	—			31,309			31,309			—			28,761			28,761
Insurance commissions	—			5,349			5,349			—			3,079			3,079
Capital markets revenue	3,481			—			3,481			1,796			—			1,796
Service charges on deposit accounts	2,191			—			2,191			1,953			—			1,953
Loan servicing and other fees	1,720			—			1,720			1,570			—			1,570
Net gain on sale of loans	1,677			—			1,677			1,948			—			1,948
Net gain on sale of investment securities available for sale	7			—			7			73			—			73
Net gain (loss) gain on sale of OREO	292			—			292			(12		)	—			(12		)
Other operating income	11,709			150			11,859			4,290			138			4,428
Total noninterest income	21,077			36,808			57,885			11,618			31,978			43,596
Noninterest expenses:
Salaries & wages	34,077			14,673			48,750			27,044			12,588			39,632
Employee benefits	6,992			2,949			9,941			4,565			2,888			7,453
Occupancy and bank premises	7,035			1,429			8,464			6,025			1,233			7,258
Amortization of intangible assets	1,169			1,490			2,659			588			1,469			2,057
Professional fees	2,497			180			2,677			2,318			181			2,499
Other operating expenses	29,076			3,891			32,967			21,200			3,240			24,440
Total noninterest expenses	80,846			24,612			105,458			61,740			21,599			83,339
Segment profit	46,879			12,201			59,080			33,141			10,381			43,522
Intersegment (revenues) expenses*	(485		)	485			—			(336		)	336			—
Pre-tax segment profit after eliminations	$	46,394		$	12,686		$	59,080		$	32,805		$	10,717		$	43,522
% of segment pre-tax profit after eliminations	78.5		%	21.5		%	100.0		%	75.4		%	24.6		%	100.0		%
Segment assets (dollars in millions)	$	4,335.8		$	52.6		$	4,388.4		$	3,424.8		$	52.0		$	3,476.8

*Inter-segment revenues consist of rental payments, interest on deposits and management fees.

Wealth Management Segment Information

(dollars in millions)	September 30, 2018		December 31, 2017
Assets under management, administration, supervision and brokerage	$	13,913.3	$	12,968.7

XML

Recent Accounting Pronouncements (Policies)

9 Months Ended

Sep. 30, 2018

Accounting Policies [Abstract]

Adopted Pronouncements and Pronouncements Not Yet Effective

Adopted Pronouncements:

FASB ASU 2014-9 (Topic 606), “Revenue from Contracts with Customers”

The Corporation adopted ASU 2014-9 Revenue from Contracts with Customers and all subsequent amendments to the ASU (collectively, “ASC 606”), which (i) creates a single framework for recognizing revenue from contracts with customers that fall within its scope and (ii) revises when it is appropriate to recognize a gain (loss) from the transfer of nonfinancial assets, such as OREO. The majority of the Corporation’s revenues come from interest income and other sources, including loans, leases, investment securities and derivatives, that are outside the scope of ASC 606. The Corporation’s services that fall within the scope of ASC 606 are presented within noninterest income and are recognized as revenue as the Corporation satisfies its obligation to the customer. Services within the scope of ASC 606 include service charges on deposits, Visa debit card income, wealth management fees, investment brokerage fees, and the net gain on sale of OREO. Refer to Note 17 Revenuefrom Contracts with Customers for further discussion on the Corporation’s accounting policies for revenue sources within the scope of ASC 606. The adoption of this ASU did not have an impact to our Consolidated Financial Statements and related disclosures.

FASB ASU 2017-1 (Topic 805), “Business Combinations”

The Corporation adopted ASU 2017-1, which clarifies the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The adoption of this ASU did not have a material impact on our Consolidated Financial Statements and related disclosures.

FASB ASU 2016-15 (Topic 320), “Classification of Certain Cash Receipts and Cash Payments”

The Corporation adopted ASU 2016-15, which provides guidance on eight specific cash flow issues and their disclosure in the consolidated statements of cash flows. The issues addressed include debt prepayment, settlement of zero-coupon debt, contingent consideration in business combinations, proceeds from settlement of insurance claims, proceeds from settlement of BOLI, distributions received from equity method investees, beneficial interests in securitization transactions, and separately identifiable cash flows and application of the predominance principle. The adoption of this ASU did not have a material impact on our Consolidated Financial Statements and related disclosures.

FASB ASU 2016-1 (Subtopic 825-10), “Financial Instruments – Overall, Recognition and Measurement of Financial Assets and Financial Liabilities”

The Corporation adopted ASU 2016-1 which requires that equity investments be measured at fair value with changes in fair value recognized in net income. The Corporation’s equity investments with a readily determinable fair value are currently included within trading securities and are measured at fair value with changes in fair value recognized in net income. In connection with the adoption of this ASU, the Corporation elected the practicability exception to fair value measurement for investments in equity securities without a readily determinable fair value (other than our Federal Home Loan Bank (“FHLB”), Federal Reserve Bank ("FRB"), and Atlantic Central Bankers Bank stock, which are outside of the scope of this ASU). Under the practicability exception, the investments are measured at cost, less impairment, plus or minus observable price changes (in orderly transactions) of an identical or similar investment of the same issuer. The adoption of this ASU did not have a material impact on our Consolidated Financial Statements and related disclosures.

FASB ASU 2017-7 (Topic 715), “Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost”

On January 1, 2018, the Corporation adopted ASU 2017-7 and all subsequent amendments to the ASU, which requires that an employer report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations, if one is presented. If a separate line item or items are used to present the other components of net benefit cost, that line item or items must be appropriately described. If a separate line item or items are not used, the line item or items used in the income statement to present the other components of net benefit cost must be disclosed. The amendments in this update also allow only the service cost component to be eligible for capitalization when applicable (for example, as a cost of internally manufactured inventory or a self-constructed asset).

Upon adoption, the components of net periodic benefit cost other than the service cost component were reclassified retrospectively from “Employee benefits” to “Other operating expenses” in the Consolidated Statements of Income. Since both “Employee benefits” and “Other operating expenses” line items are under “Noninterest expenses”, there was no impact to total “Noninterest expenses” or “Net income.” The components of net periodic benefit cost are currently disclosed in Note 17 – “Pension and Postretirement Benefit Plans” in the Notes to Consolidated Financial Statements found in our 2017 Annual Report. Additionally, the Corporation does not currently capitalize any components of its net periodic benefit costs. The adoption of this ASU did not have a material impact on our Consolidated Financial Statements and related disclosures.

Pronouncements Not Yet Effective:

FASB ASU 2018-07, “Improvements to Nonemployee Share-Based Payment Accounting”

Issued in June 2018, ASU 2018-07: Compensation - Stock Compensation (Topic 718), “Improvements to Nonemployee Share-Based Payment Accounting” expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. An entity should apply the requirements of Topic 718 to nonemployee awards except for specific guidance on inputs to an option pricing model and the attribution of cost (that is, the period of time over which share-based payment awards vest and the pattern of cost recognition over that period). The amendments specify that Topic 718 applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in a grantor’s own operations by issuing share-based payment awards. The amendments also clarify that Topic 718 does not apply to share-based payments used to effectively provide (1) financing to the issuer or (2) awards granted in conjunction with selling goods or services to customers as part of a contract accounted for under Topic 606, Revenue from Contracts with Customers. The amendments in this update are effective for public business entities for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. The Corporation has not historically granted share based payment awards to nonemployees other than to the Corporation’s Board of Directors, who are treated as employees for share-based payment accounting. As a result, management does not expect the adoption of this ASU to have an impact on our Consolidated Financial Statements and related disclosures.

FASB ASU 2017-4 (Topic 350), “Intangibles – Goodwill and Others”

Issued in January 2017, ASU 2017-4 simplifies how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. Step 2 measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. ASU 2017-4 is effective for annual periods beginning after December 15, 2019 including interim periods within those periods. Management does not expect the adoption of this ASU to have a material impact on our Consolidated Financial Statements and related disclosures.

FASB ASU 2016-13 (Topic 326), “Measurement of Credit Losses on Financial Instruments”

Issued in June 2016, ASU 2016-13 significantly changes how companies measure and recognize credit impairment for many financial assets. The new current expected credit loss (“CECL”) model will require companies to immediately recognize an estimate of credit losses expected to occur over the remaining life of the financial assets that are in the scope of the standard. The ASU also makes targeted amendments to the current impairment model for available-for-sale debt securities. ASU 2016-13 is effective for the annual and interim periods in fiscal years beginning after December 15, 2019, with early adoption permitted. Adoption of this new guidance can be applied only on a prospective basis as a cumulative-effect adjustment to retained earnings.

It is expected that the new model will include different assumptions used in calculating credit losses, such as estimating losses over the estimated life of a financial asset, and will consider expected future changes in macroeconomic conditions. The adoption of this ASU may result in an increase to the Corporation’s allowance for credit losses, which will depend upon the nature and characteristics of the Corporation 's portfolio at the adoption date, as well as the macroeconomic conditions and forecasts at the adoption date. The Corporation has engaged the services of a third-party consultant as well as invested in software designed to assist management in the development and implementation of the new CECL model. Management has validated historical data uploaded within the third-party software and is beginning to develop the CECL model, including evaluating key assumptions such as portfolio segmentation, life of loan assumptions, and financial forecasts. The adoption of this ASU will also require the addition of an allowance for held-to-maturity debt securities. The Corporation currently does not intend to early adopt this new guidance.

FASB ASU 2016-2 (Topic 842), “Leases”

Issued in February 2016, ASU 2016-2 revises the accounting related to lessee accounting. Under the new guidance, lessees will be required to recognize a lease liability and right-of-use asset for all leases. The new lease guidance also simplifies the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and lease liabilities. ASU 2016-2 is effective for the first interim period within annual periods beginning after December 15, 2018, with early adoption permitted. The standard is required to be adopted using the modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. Management is in-process of migrating data and key assumptions into a third-party lease accounting software to calculate the lease liability and right-of-use asset for all existing leases of the Corporation. Management is aware that the adoption of this ASU will impact the Corporation’s balance sheet for the recording of assets and liabilities for operating leases. Any additional assets recorded as a result of implementation will have a negative impact on the Corporation and Bank capital ratios under current regulatory guidance.

FASB ASU 2018-12 (Topic 944), “Targeted Improvements to the Accounting for Long-Duration Contracts”

Issued in August 2018, ASU 2018-12 makes targeted improvements to the existing recognition, measurement, presentation, and disclosure requirements for long-duration contracts issued by an insurance entity. Specifically, the ASU is intended to 1) improve the timeliness of recognizing changes in the liability for future policy benefits and modify the rate used to discount future cash flows, 2) simplify and improve the accounting for certain market-based options or guarantees associated with deposit (or account balance) contracts, 3) simplify the amortization of deferred acquisition costs, and 4) improve the effectiveness of the required disclosures. ASU 2018-12 is effective for public business entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early application of the amendments is permitted. As an independent insurance agent, the Corporation does not issue insurance contracts. As a result, management does not expect the adoption of this ASU to have an impact on our Consolidated Financial Statements and related disclosures.

XML

Business Combinations (Tables)

9 Months Ended

Sep. 30, 2018

Business Combinations [Abstract]

Schedules of Recognized Identified Assets Acquired and Liabilities Assumed

The following table details the consideration paid, the initial estimated fair value of identifiable assets acquired and liabilities assumed as of the date of acquisition and the resulting goodwill recorded:

(dollars in thousands)
Consideration paid:
Cash paid at closing	$	750
Contingent payment liability (present value)	706
Value of consideration	$	1,456
Assets acquired:
Cash and due from banks	370
Intangible assets - customer relationships	779
Premises and equipment	1
Other assets	316
Total assets	1,466
Liabilities assumed:
Accounts payable	657
Other liabilities	30
Total liabilities	$	687
Net assets acquired	$	779
Goodwill resulting from acquisition of Domenick	$	677

In connection with the Hirshorn acquisition, the following table details the consideration paid, the initial estimated fair value of identifiable assets acquired and liabilities assumed as of the date of acquisition and the resulting goodwill recorded:

(dollars in thousands)
Consideration paid:
Cash paid at closing	$	5,770
Contingent payment liability (present value)	1,690
Value of consideration	7,460
Assets acquired:
Cash operating accounts	978
Intangible assets – trade name	195
Intangible assets – customer relationships	2,672
Intangible assets – non-competition agreements	41
Premises and equipment	1,795
Accounts receivable	192
Other assets	27
Total assets	5,900
Liabilities assumed:
Accounts payable	800
Other liabilities	2
Total liabilities	802
Net assets acquired	5,098
Goodwill resulting from acquisition of Hirshorn	$	2,362

In connection with the RBPI Merger, the consideration paid and the estimated fair value of identifiable assets acquired and liabilities assumed as of the Effective Date, which include the effects of any measurement period adjustments in accordance with ASC 805-10, are summarized in the following table:

(dollars in thousands)
Consideration paid:
Common shares issued (3,101,316)	$	136,768
Cash in lieu of fractional shares	7
Cash-out of certain options	112
Fair value of warrants assumed	1,853
Value of consideration	$	138,740
Assets acquired:
Cash and due from banks	17,092
Investment securities available for sale	121,587
Loans	566,228
Premises and equipment	8,264
Deferred income taxes	34,586
Bank-owned life insurance	16,550
Core deposit intangible	4,670
Favorable lease asset	566
Other assets	13,996
Total assets	$	783,539
Liabilities assumed:
Deposits	593,172
FHLB and other long-term borrowings	59,568
Short-term borrowings	15,000
Junior subordinated debentures	21,416
Unfavorable lease liability	322
Other liabilities	31,381
Total liabilities	$	720,859
Net assets acquired	$	62,680
Goodwill resulting from acquisition of RBPI	$	76,060

Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustments

The following table details the changes in fair value of the net assets acquired and liabilities assumed as of the Effective Date from the amounts originally reported in the 2017 Annual Report:

(dollars in thousands)
Goodwill resulting from the acquisition of RBPI reported as of December 31, 2017	$	72,762
Value of Consideration Adjustment:
Common shares issued (2,562)	113
Fair Value Adjustments:
Loans	4,145
Other assets	491
Deferred income taxes	(1,451		)
Total Fair Value Adjustments	3,185
Goodwill from the acquisition of RBPI as of September 30, 2018	$	76,060

Summary of Certain Loans Acquired in Transfer Not Accounted for as Debt Securities Acquired During Period

The following table provides an updated summary of the acquired impaired loans and leases as of the Effective Date, which include the effects of any measurement period adjustments in accordance with ASC 805-10, resulting from the RBPI Merger:

(dollars in thousands)
Contractually required principal and interest payments	$	40,741
Contractual cash flows not expected to be collected (nonaccretable difference)	(17,637		)
Cash flows expected to be collected	23,104
Interest component of expected cash flows (accretable yield)	(2,644		)
Fair value of loans acquired with deterioration of credit quality	$	20,460

Business Acquisition, Pro Forma Information

The following table presents the pro forma income statement of the combined institution (RBPI and the Corporation) for the three and nine months ended September 30, 2017 as if the RBPI Merger had occurred on January 1, 2017. The pro forma income statement adjustments are limited to the effects of purchase accounting fair value mark amortization and accretion and intangible asset amortization. No cost savings or additional merger expenses have been included in the pro forma income statement. Due to the immaterial contribution to net income of the Hirshorn acquisition, which occurred during the year shown in the table, the pro forma effects of the Hirshorn acquisition have been excluded.

(dollars in thousands)	Three Months Ended September 30, 2017		Nine Months Ended September 30, 2017
Total interest income	$	43,412	$	126,976
Total interest expense	5,480		15,013
Net interest income	37,932		111,963
Provision for loan and lease losses	1,492		2,054
Net interest income after provision for loan and lease losses	36,440		109,909
Total noninterest income	16,015		45,481
Total noninterest expenses*	33,364		99,699
Income before income taxes	19,091		55,691
Income tax expense	5,843		18,306
Net income	$	13,248	$	37,385
Per share data**:
Weighted-average basic shares outstanding	20,121,800		20,086,253
Dilutive shares	261,935		284,294
Adjusted weighted-average diluted shares	20,383,735		20,370,547
Basic earnings per common share	$	0.66	$	1.86
Diluted earnings per common share	$	0.65	$	1.84

*Total noninterest expense includes RBPI Net Income Attributable to Noncontrolling Interest and Preferred Stock Series A Accumulated Dividend and Accretion for pro forma presentation.

**Assumes that the shares of RBPI common stock outstanding as of December 31, 2017 were outstanding for the full three and nine month periods ended September 30, 2017.

Summary of Integration Related Costs

The following table details the costs identified and classified as due diligence, merger-related and merger integration costs for the periods indicated:

	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2018		2017		2018		2017
Advertising	$	—	$	89	$	61	$	108
Employee Benefits	—		5		271		10
Occupancy and bank premises	—		—		2,145		—
Furniture, fixtures, and equipment	—		31		365		37
Information technology	167		41		421		300
Professional fees	193		632		1,450		1,570
Salaries and wages	29		28		852		428
Other	—		24		2,196		144
Total due diligence, merger-related and merger integration expenses	$	389	$	850	$	7,761	$	2,597

XML

Investment Securities (Tables)

9 Months Ended

Sep. 30, 2018

Investments, Debt and Equity Securities [Abstract]

Available-for-sale Securities

The amortized cost and fair value of investment securities available for sale as of September 30, 2018 and December 31, 2017 are as follows:

As of September 30, 2018

(dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U.S. Treasury securities	$	100	$	—	$	—		$	100
Obligations of the U.S. government and agencies	196,334		17		(5,898		)	190,453
Obligations of state and political subdivisions	15,890		1		(92		)	15,799
Mortgage-backed securities	292,005		344		(7,928		)	284,421
Collateralized mortgage obligations	37,811		—		(1,618		)	36,193
Other investment securities	1,100		—		(2		)	1,098
Total	$	543,240	$	362	$	(15,538	)	$	528,064

As of December 31, 2017

(dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U.S. Treasury securities	$	200,077	$	11	$	—		$	200,088
Obligations of the U.S. government and agencies	153,028		75		(2,059		)	151,044
Obligations of state and political subdivisions	21,352		11		(53		)	21,310
Mortgage-backed securities	275,958		887		(1,855		)	274,990
Collateralized mortgage obligations	37,596		14		(948		)	36,662
Other investment securities	4,813		318		(23		)	5,108
Total	$	692,824	$	1,316	$	(4,938	)	$	689,202

Summary of Available-for-sale Debt Securities, Unrealized Loss Position, Fair Value

The following tables present the aggregate amount of gross unrealized losses as of September 30, 2018 and December 31, 2017 on available for sale investment securities classified according to the amount of time those securities have been in a continuous unrealized loss position:

As of September 30, 2018

	Less than 12 Months					12 Months or Longer					Total
(dollars in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Obligations of the U.S. government and agencies	$	82,187	$	(1,634	)	$	107,601	$	(4,264	)	$	189,788	$	(5,898	)
Obligations of state and political subdivisions	11,009		(21		)	2,303		(71		)	13,312		(92		)
Mortgage-backed securities	136,170		(3,037		)	130,269		(4,891		)	266,439		(7,928		)
Collateralized mortgage obligations	10,939		(86		)	24,945		(1,532		)	35,884		(1,618		)
Other investment securities	549		(1		)	249		(1		)	798		(2		)
Total	$	240,854	$	(4,779	)	$	265,367	$	(10,759	)	$	506,221	$	(15,538	)

As of December 31, 2017

	Less than 12 Months					12 Months or Longer					Total
(dollars in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Obligations of the U.S. government and agencies	$	114,120	$	(1,294	)	$	26,726	$	(765	)	$	140,846	$	(2,059	)
Obligations of state and political subdivisions	11,144		(29		)	2,709		(24		)	13,853		(53		)
Mortgage-backed securities	177,919		(1,293		)	31,787		(562		)	209,706		(1,855		)
Collateralized mortgage obligations	5,166		(47		)	26,686		(901		)	31,852		(948		)
Other investment securities	1,805		(23		)	—		—			1,805		(23		)
Total	$	310,154	$	(2,686	)	$	87,908	$	(2,252	)	$	398,062	$	(4,938	)

Investments Classified by Contractual Maturity Date

The amortized cost and fair value of held to maturity investment securities as of September 30, 2018 and December 31, 2017, by contractual maturity, are shown below:

	September 30, 2018				December 31, 2017
(dollars in thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Mortgage-backed securities(1)	$	8,916	$	8,544	$	7,932	$	7,851

(1) Expected maturities of mortgage-related securities may differ from contractual maturities as borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

	September 30, 2018				December 31, 2017
(dollars in thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Investment securities:
Due in one year or less	$	12,265	$	12,237	$	211,019	$	211,019
Due after one year through five years	176,700		171,374		126,452		124,797
Due after five years through ten years	24,459		23,839		23,147		22,804
Due after ten years	—		—		15,439		15,421
Subtotal	213,424		207,450		376,057		374,041
Mortgage-related securities(1)	329,816		320,614		313,554		311,652
Mutual funds with no stated maturity	—		—		3,213		3,509
Total	$	543,240	$	528,064	$	692,824	$	689,202

(1) Expected maturities of mortgage-related securities may differ from contractual maturities as borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

Summary of Held-to-maturity Debt Securities

The amortized cost and fair value of investment securities held to maturity as of September 30, 2018 and December 31, 2017 are as follows:

As of September 30, 2018

(dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Mortgage-backed securities	$	8,916	$	—	$	(372	)	$	8,544

As of December 31, 2017

(dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Mortgage-backed securities	$	7,932	$	5	$	(86	)	$	7,851

Summary of Held-to-maturity Securities, Continuous Unrealized Loss Position, Fair Value

The following tables present the aggregate amount of gross unrealized losses as of September 30, 2018 and December 31, 2017 on held to maturity securities classified according to the amount of time those securities have been in a continuous unrealized loss position:

As of September 30, 2018

	Less than 12 Months					12 Months or Longer					Total
(dollars in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Mortgage-backed securities	$	3,882	$	(132	)	$	4,662	$	(240	)	$	8,544	$	(372	)

As of December 31, 2017

	Less than 12 Months					12 Months or Longer					Total
(dollars in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Mortgage-backed securities	$	2,756	$	(25	)	$	3,866	$	(61	)	$	6,622	$	(86	)

XML

Loans and Leases (Tables)

9 Months Ended

Sep. 30, 2018

Receivables [Abstract]

Schedule of Accounts, Notes, Loans and Financing Receivable

The table below detailsportfolio loans and leases as of the dates indicated:

	September 30, 2018						December 31, 2017
(dollars in thousands)	Originated		Acquired		Total Loans and Leases		Originated		Acquired		Total Loans and Leases
Loans held for sale	$	4,111	$	—	$	4,111	$	3,794	$	—	$	3,794
Real Estate Loans:
Commercial mortgage	$	1,259,397	$	359,096	$	1,618,493	$	1,122,327	$	401,050	$	1,523,377
Home equity lines and loans	180,068		27,738		207,806		183,283		34,992		218,275
Residential mortgage	381,037		86,365		467,402		360,935		97,951		458,886
Construction	158,691		19,802		178,493		128,266		84,188		212,454
Total real estate loans	$	1,979,193	$	493,001	$	2,472,194	$	1,794,811	$	618,181	$	2,412,992
Commercial and industrial	618,200		104,799		722,999		589,304		130,008		719,312
Consumer	44,833		2,976		47,809		35,146		3,007		38,153
Leases	109,934		28,539		138,473		68,035		47,366		115,401
Total portfolio loans and leases	$	2,752,160	$	629,315	$	3,381,475	$	2,487,296	$	798,562	$	3,285,858
Total loans and leases	$	2,756,271	$	629,315	$	3,385,586	$	2,491,090	$	798,562	$	3,289,652
Loans with fixed rates	$	1,167,097	$	375,326	$	1,542,423	$	1,034,542	$	538,510	$	1,573,052
Loans with adjustable or floating rates	1,589,174		253,989		1,843,163		1,456,548		260,052		1,716,600
Total loans and leases	$	2,756,271	$	629,315	$	3,385,586	$	2,491,090	$	798,562	$	3,289,652
Net deferred loan origination fees included in the above loan table	$	1,220	$	—	$	1,220	$	887	$	—	$	887

Schedule of Components of Leveraged Lease Investments

Components of the net investment in leases are detailed as follows:

	September 30, 2018									December 31, 2017
(dollars in thousands)	Originated			Acquired			Total Leases			Originated			Acquired			Total Leases
Minimum lease payments receivable	$	122,596		$	32,039		$	154,635		$	75,592		$	55,219		$	130,811
Unearned lease income	(17,717		)	(4,293		)	(22,010		)	(10,338		)	(9,523		)	(19,861		)
Initial direct costs and deferred fees	5,055			793			5,848			2,781			1,670			4,451
Total Leases	$	109,934		$	28,539		$	138,473		$	68,035		$	47,366		$	115,401

Schedule of Financing Receivables, Non Accrual Status

Non-Performing Loans and Leases⁽¹⁾  

	September 30, 2018						December 31, 2017
(dollars in thousands)	Originated		Acquired		Total Loans and Leases		Originated		Acquired		Total Loans and Leases
Commercial mortgage	$	—	$	735	$	735	$	90	$	782	$	872
Home equity lines and loans	1,692		241		1,933		1,221		260		1,481
Residential mortgage	1,968		802		2,770		1,505		2,912		4,417
Construction	291		—		291		—		—		—
Commercial and industrial	925		857		1,782		826		880		1,706
Consumer	42		75		117		—		—		—
Leases	479		883		1,362		103		—		103
Total non-performing loans and leases	$	5,397	$	3,593	$	8,990	$	3,745	$	4,834	$	8,579

(1) Purchased credit-impaired loans, which have been recorded at their fair values at acquisition, and which are performing, are excluded from this table, with theexception of$393 thousandand $167 thousand of purchased credit-impaired loans as of September 30, 2018 and December 31, 2017,respectively, which became non-performing subsequent to acquisition.

Schedule of Information Related to Purchased Credit Impaired Loans

The outstanding principal balance and related carrying amount of purchased credit-impaired loans, for which the Corporation applies ASC 310-30, Accounting for Purchased Loans with Deteriorated Credit Quality, to account for the interest earned, as of the dates indicated, are as follows:

(dollars in thousands)	September 30, 2018		December 31, 2017
Outstanding principal balance	$	38,062	$	46,543
Carrying amount(1)	$	27,519	$	30,849

(1) Includes $393 thousand and $173 thousand of purchased credit-impaired loans as of September 30, 2018 and December 31, 2017, respectively, for which the Corporation could not estimate the timing or amount of expected cash flows to be collected at acquisition, and for which no accretable yield is recognized. Additionally, the table above includes $393 thousand and $167 thousand of purchased credit-impaired loans as of September 30, 2018 and December 31, 2017, respectively, which became non-performing subsequent to acquisition, which are disclosed in Note 5C, above, and which also have no accretable yield.

Schedule of Changes in Accretable Discount Related to Purchased Credit Impaired Loans

The following table presents changes in the accretable discount on purchased credit-impaired loans, for which the Corporation applies ASC 310-30, for the nine months ended September 30, 2018: 

(dollars in thousands)	Accretable Discount
Balance, December 31, 2017	$	4,083
Accretion	(1,819		)
Reclassifications from nonaccretable difference	609
Additions/adjustments	329
Balance, September 30, 2018	$	3,202

Past Due Financing Receivables

The following tables present an aging of all portfolio loans and leases as of the dates indicated:

	Accruing Loans and Leases
As of September 30, 2018	30 – 59 Days Past Due		60 – 89 Days Past Due		Over 89 Days Past Due		Total Past Due		Current*		Total Accruing Loans and Leases		Nonaccrual Loans and Leases		Total Loans and Leases
(dollars in thousands)
Commercial mortgage	$	—	$	2,468	$	—	$	2,468	$	1,615,290	$	1,617,758	$	735	$	1,618,493
Home equity lines and loans	324		—		—		324		205,549		205,873		1,933		207,806
Residential mortgage	2,218		179		—		2,397		462,235		464,632		2,770		467,402
Construction	488		—		—		488		177,714		178,202		291		178,493
Commercial and industrial	1,115		1,255		—		2,370		718,847		721,217		1,782		722,999
Consumer	46		23		—		69		47,623		47,692		117		47,809
Leases	751		252		—		1,003		136,108		137,111		1,362		138,473
Total portfolio loans and leases	$	4,942	$	4,177	$	—	$	9,119	$	3,363,366	$	3,372,485	$	8,990	$	3,381,475

	Accruing Loans and Leases
As of December 31, 2017	30 – 59 Days Past Due		60 – 89 Days Past Due		Over 89 Days Past Due		Total Past Due		Current*		Total Accruing Loans and Leases		Nonaccrual Loans and Leases		Total Loans and Leases
(dollars in thousands)
Commercial mortgage	$	1,366	$	2,428	$	—	$	3,794	$	1,518,711	$	1,522,505	$	872	$	1,523,377
Home equity lines and loans	338		10		—		348		216,446		216,794		1,481		218,275
Residential mortgage	1,386		79		—		1,465		453,004		454,469		4,417		458,886
Construction	—		—		—		—		212,454		212,454		—		212,454
Commercial and industrial	658		286		—		944		716,662		717,606		1,706		719,312
Consumer	1,106		—		—		1,106		37,047		38,153		—		38,153
Leases	125		177		—		302		114,996		115,298		103		115,401
Total portfolio loans and leases	$	4,979	$	2,980	$	—	$	7,959	$	3,269,320	$	3,277,279	$	8,579	$	3,285,858

*Included as “current” are $720 thousand and $4.1 million of loans and leases as of September 30, 2018 and December 31, 2017, respectively, which are classified as administratively delinquent. An administratively delinquent loan is one which has been approved for a renewal or extension but has not had all the required documents fully executed as of the reporting date. Management does not consider these loans to be delinquent.

The following tables present an aging of originated portfolio loans and leases as of the dates indicated:

	Accruing Loans and Leases
As of September 30, 2018	30 – 59 Days Past Due		60 – 89 Days Past Due		Over 89 Days Past Due		Total Past Due		Current*		Total Accruing Loans and Leases		Nonaccrual Loans and Leases		Total Loans and Leases
(dollars in thousands)
Commercial mortgage	$	—	$	76	$	—	$	76	$	1,259,321	$	1,259,397	$	—	$	1,259,397
Home equity lines and loans	250		—		—		250		178,126		178,376		1,692		180,068
Residential mortgage	1,475		—		—		1,475		377,594		379,069		1,968		381,037
Construction	488		—		—		488		157,912		158,400		291		158,691
Commercial and industrial	1,051		1,255		—		2,306		614,969		617,275		925		618,200
Consumer	46		23		—		69		44,722		44,791		42		44,833
Leases	407		115		—		522		108,933		109,455		479		109,934
Total originated portfolio loans and leases	$	3,717	$	1,469	$	—	$	5,186	$	2,741,577	$	2,746,763	$	5,397	$	2,752,160

	Accruing Loans and Leases
As of December 31, 2017	30 – 59 Days Past Due		60 – 89 Days Past Due		Over 89 Days Past Due		Total Past Due		Current*		Total Accruing Loans and Leases		Nonaccrual Loans and Leases		Total Loans and Leases
(dollars in thousands)
Commercial mortgage	$	1,255	$	81	$	—	$	1,336	$	1,120,901	$	1,122,237	$	90	$	1,122,327
Home equity lines and loans	26		—		—		26		182,036		182,062		1,221		183,283
Residential mortgage	721		—		—		721		358,709		359,430		1,505		360,935
Construction	—		—		—		—		128,266		128,266		—		128,266
Commercial and industrial	439		236		—		675		587,803		588,478		826		589,304
Consumer	21		—		—		21		35,125		35,146		—		35,146
Leases	125		177		—		302		67,630		67,932		103		68,035
Total originated portfolio loans and leases	$	2,587	$	494	$	—	$	3,081	$	2,480,470	$	2,483,551	$	3,745	$	2,487,296

*Included as “current” are $720 thousand and $4.0 million of loans and leases as of September 30, 2018 and December 31, 2017, respectively, which are classified as administratively delinquent. An administratively delinquent loan is one which has been approved for a renewal or extension but has not had all the required documents fully executed as of the reporting date. Management does not consider these loans to be delinquent.

The following tables present an aging of acquired portfolio loans and leases as of the dates indicated:

	Accruing Loans and Leases
As of September 30, 2018	30 – 59 Days Past Due		60 – 89 Days Past Due		Over 89 Days Past Due		Total Past Due		Current*		Total Accruing Loans and Leases		Nonaccrual Loans and Leases		Total Loans and Leases
(dollars in thousands)
Commercial mortgage	$	—	$	2,392	$	—	$	2,392	$	355,969	$	358,361	$	735	$	359,096
Home equity lines and loans	74		—		—		74		27,423		27,497		241		27,738
Residential mortgage	743		179		—		922		84,641		85,563		802		86,365
Construction	—		—		—		—		19,802		19,802		—		19,802
Commercial and industrial	64		—		—		64		103,878		103,942		857		104,799
Consumer	—		—		—		—		2,901		2,901		75		2,976
Leases	344		137		—		481		27,175		27,656		883		28,539
Total acquired portfolio loans and leases	$	1,225	$	2,708	$	—	$	3,933	$	621,789	$	625,722	$	3,593	$	629,315

	Accruing Loans and Leases
As of December 31, 2017	30 – 59 Days Past Due		60 – 89 Days Past Due		Over 89 Days Past Due		Total Past Due		Current*		Total Accruing Loans and Leases		Nonaccrual Loans and Leases		Total Loans and Leases
(dollars in thousands)
Commercial mortgage	$	111	$	2,347	$	—	$	2,458	$	397,810	$	400,268	$	782	$	401,050
Home equity lines and loans	312		10		—		322		34,410		34,732		260		34,992
Residential mortgage	665		79		—		744		94,295		95,039		2,912		97,951
Construction	—		—		—		—		84,188		84,188		—		84,188
Commercial and industrial	219		50		—		269		128,859		129,128		880		130,008
Consumer	1,085		—		—		1,085		1,922		3,007		—		3,007
Leases	—		—		—		—		47,366		47,366		—		47,366
Total acquired portfolio loans and leases	$	2,392	$	2,486	$	—	$	4,878	$	788,850	$	793,728	$	4,834	$	798,562

*Included as “current” are $0 and $102 thousand of loans and leases as of September 30, 2018 and December 31, 2017, respectively, which are classified as administratively delinquent. An administratively delinquent loan is one which has been approved for a renewal or extension but has not had all the required documents fully executed as of the reporting date. Management does not consider these loans to be delinquent.

Allowance for Credit Losses on Financing Receivables

The following tables detail the roll-forward of the Allowance for the three and nine months ended September 30, 2018 and 2017:

(dollars in thousands)	Commercial Mortgage			Home Equity Lines and Loans			Residential Mortgage			Construction		Commercial and Industrial			Consumer			Leases			Unallocated		Total
Balance, December 31, 2017	$	7,550		$	1,086		$	1,926		$	937	$	5,038		$	246		$	742		$	—	$	17,525
Charge-offs	(74		)	(225		)	(42		)	—		(1,069		)	(165		)	(2,416		)	—		(3,991		)
Recoveries	8			1			55			1		17			5			232			—		319
Provision for loan and lease losses	60			30			(121		)	303		1,319			232			3,008			—		4,831
Balance, September 30, 2018	$	7,544		$	892		$	1,818		$	1,241	$	5,305		$	318		$	1,566		$	—	$	18,684

(dollars in thousands)	Commercial Mortgage			Home Equity Lines and Loans			Residential Mortgage			Construction		Commercial and Industrial			Consumer			Leases			Unallocated		Total
Balance, June 30, 2018	$	8,033		$	933		$	1,933		$	1,158	$	5,672		$	289		$	1,380		$	—	$	19,398
Charge-offs	(58		)	—			(42		)	—		(319		)	(73		)	(1,068		)	—		(1,560		)
Recoveries	2			—			54			—		16			2			108			—		182
Provision for loan and lease losses	(433		)	(41		)	(127		)	83		(64		)	100			1,146			—		664
Balance, September 30, 2018	$	7,544		$	892		$	1,818		$	1,241	$	5,305		$	318		$	1,566		$	—	$	18,684

(dollars in thousands)	Commercial Mortgage		Home Equity Lines and Loans			Residential Mortgage			Construction			Commercial and Industrial			Consumer			Leases			Unallocated		Total
Balance, December 31, 2016	$	6,227	$	1,255		$	1,917		$	2,233		$	5,142		$	153		$	559		$	—	$	17,486
Charge-offs	—		(676		)	(158		)	—			(560		)	(96		)	(924		)	—		(2,414		)
Recoveries	9		—			85			3			18			5			271			—		391
Provision for loan and lease losses	1,096		513			(23		)	(1,306		)	280			148			833			—		1,541
Balance, September 30, 2017	$	7,332	$	1,092		$	1,821		$	930		$	4,880		$	210		$	739		$	—	$	17,004

(dollars in thousands)	Commercial Mortgage		Home Equity Lines and Loans			Residential Mortgage			Construction			Commercial and Industrial			Consumer			Leases			Unallocated		Total
Balance, June 30, 2017	$	6,608	$	1,214		$	1,776		$	1,111		$	4,813		$	177		$	700		$	—	$	16,399
Charge-offs	—		(69		)	(88		)	—			(301		)	(37		)	(411		)	—		(906		)
Recoveries	3		—			85			1			2			1			86			—		178
Provision for loan and lease losses	721		(53		)	48			(182		)	366			69			364			—		1,333
Balance, September 30, 2017	$	7,332	$	1,092		$	1,821		$	930		$	4,880		$	210		$	739		$	—	$	17,004

Financing Receivable by Financial Instrument Performance Status

The following tables detail the allocation of the Allowance for all portfolio loans and leases by portfolio segment based on the methodology used to evaluate the loans and leases for impairment as of September 30, 2018 and December 31, 2017:

As of September 30, 2018	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Unallocated		Total
(dollars in thousands)
Allowance on loans and leases:
Individually evaluated for impairment	$	—	$	19	$	228	$	—	$	11	$	20	$	—	$	—	$	278
Collectively evaluated for impairment	7,544		873		1,590		1,241		5,294		298		1,566		—		18,406
Purchased credit-impaired(1)	—		—		—		—		—		—		—		—		—
Total	$	7,544	$	892	$	1,818	$	1,241	$	5,305	$	318	$	1,566	$	—	$	18,684

⁽¹⁾ Purchased credit-impaired loans are evaluated for impairment on an individual basis.

As of December 31, 2017	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Unallocated		Total
(dollars in thousands)
Allowance on loans and leases:
Individually evaluated for impairment	$	—	$	19	$	230	$	—	$	5	$	4	$	—	$	—	$	258
Collectively evaluated for impairment	7,550		1,067		1,696		937		5,033		242		742		—		17,267
Purchased credit-impaired(1)	—		—		—		—		—		—		—		—		—
Total	$	7,550	$	1,086	$	1,926	$	937	$	5,038	$	246	$	742	$	—	$	17,525

⁽¹⁾ Purchased credit-impaired loans are evaluated for impairment on an individual basis.

The following tables detail the carrying value for all portfolio loans and leases by portfolio segment based on the methodology used to evaluate the loans and leases for impairment as of September 30, 2018 and December 31, 2017:

As of September 30, 2018	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Carrying value of loans and leases:
Individually evaluated for impairment	$	736	$	2,602	$	5,940	$	291	$	1,757	$	144	$	—	$	11,470
Collectively evaluated for impairment	1,609,375		204,694		461,462		175,802		705,015		47,665		138,473		3,342,486
Purchased credit-impaired(1)	8,382		510		—		2,400		16,227		—		—		27,519
Total	$	1,618,493	$	207,806	$	467,402	$	178,493	$	722,999	$	47,809	$	138,473	$	3,381,475

⁽¹⁾ Purchased credit-impaired loans are evaluated for impairment on an individual basis.

As of December 31, 2017	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Carrying value of loans and leases:
Individually evaluated for impairment	$	2,128	$	2,162	$	7,726	$	—	$	1,897	$	27	$	—	$	13,940
Collectively evaluated for impairment	1,503,825		215,604		451,160		204,088		712,865		38,126		115,401		3,241,069
Purchased credit-impaired(1)	17,424		509		—		8,366		4,550		—		—		30,849
Total	$	1,523,377	$	218,275	$	458,886	$	212,454	$	719,312	$	38,153	$	115,401	$	3,285,858

⁽¹⁾ Purchased credit-impaired loans are evaluated for impairment on an individual basis.

The following tables detail the allocation of the Allowance for originated portfolio loans and leases by portfolio segment based on the methodology used to evaluate the loans and leases for impairment as of September 30, 2018 and December 31, 2017:

As of September 30, 2018	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Allowance on loans and leases:
Individually evaluated for impairment	$	—	$	19	$	179	$	—	$	4	$	4	$	—	$	206
Collectively evaluated for impairment	7,544		873		1,590		1,241		5,294		298		1,566		18,406
Total	$	7,544	$	892	$	1,769	$	1,241	$	5,298	$	302	$	1,566	$	18,612

As of December 31, 2017	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Allowance on loans and leases:
Individually evaluated for impairment	$	—	$	19	$	180	$	—	$	5	$	4	$	—	$	208
Collectively evaluated for impairment	7,550		1,067		1,696		937		5,033		242		742		17,267
Total	$	7,550	$	1,086	$	1,876	$	937	$	5,038	$	246	$	742	$	17,475

The following tables detail the carrying value for originated portfolio loans and leases by portfolio segment based on the methodology used to evaluate the loans and leases for impairment as of September 30, 2018 and December 31, 2017:

As of September 30, 2018	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Carrying value of loans and leases:
Individually evaluated for impairment	$	—	$	2,361	$	4,268	$	291	$	1,294	$	68	$	—	$	8,282
Collectively evaluated for impairment	1,259,397		177,707		376,769		158,400		616,906		44,765		109,934		2,743,878
Total	$	1,259,397	$	180,068	$	381,037	$	158,691	$	618,200	$	44,833	$	109,934	$	2,752,160

As of December 31, 2017	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Carrying value of loans and leases:
Individually evaluated for impairment	$	1,345	$	1,902	$	4,418	$	—	$	1,186	$	27	$	—	$	8,878
Collectively evaluated for impairment	1,120,982		181,381		356,517		128,266		588,118		35,119		68,035		2,478,418
Total	$	1,122,327	$	183,283	$	360,935	$	128,266	$	589,304	$	35,146	$	68,035	$	2,487,296

The following tables detail the allocation of the Allowance for acquired portfolio loans and leases by portfolio segment based on the methodology used to evaluate the loans and leases for impairment as of September 30, 2018 and December 31, 2017:

As of September 30, 2018	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Allowance on loans and leases:
Individually evaluated for impairment	$	—	$	—	$	49	$	—	$	7	$	16	$	—	$	72
Collectively evaluated for impairment	—		—		—		—		—		—		—		—
Purchased credit-impaired(1)	—		—		—		—		—		—		—		—
Total	$	—	$	—	$	49	$	—	$	7	$	16	$	—	$	72

⁽¹⁾ Purchased credit-impaired loans are evaluated for impairment on an individual basis.

As of December 31, 2017	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Allowance on loans and leases:
Individually evaluated for impairment	$	—	$	—	$	50	$	—	$	—	$	—	$	—	$	50
Collectively evaluated for impairment	—		—		—		—		—		—		—		—
Purchased credit-impaired(1)	—		—		—		—		—		—		—		—
Total	$	—	$	—	$	50	$	—	$	—	$	—	$	—	$	50

⁽¹⁾ Purchased credit-impaired loans are evaluated for impairment on an individual basis.

The following tables detail the carrying value for acquired portfolio loans and leases by portfolio segment based on the methodology used to evaluate the loans and leases for impairment as of September 30, 2018 and December 31, 2017:

As of September 30, 2018	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Carrying value of loans and leases:
Individually evaluated for impairment	$	736	$	241	$	1,672	$	—	$	463	$	76	$	—	$	3,188
Collectively evaluated for impairment	349,978		26,987		84,693		17,402		88,109		2,900		28,539		598,608
Purchased credit-impaired(1)	8,382		510		—		2,400		16,227		—		—		27,519
Total	$	359,096	$	27,738	$	86,365	$	19,802	$	104,799	$	2,976	$	28,539	$	629,315

⁽¹⁾Purchased credit-impaired loans are evaluated for impairment on an individual basis.

As of December 31, 2017	Commercial Mortgage		Home Equity Lines and Loans		Residential Mortgage		Construction		Commercial and Industrial		Consumer		Leases		Total
(dollars in thousands)
Carrying value of loans and leases:
Individually evaluated for impairment	$	783	$	260	$	3,308	$	—	$	711	$	—	$	—	$	5,062
Collectively evaluated for impairment	382,843		34,223		94,643		75,822		124,747		3,007		47,366		762,651
Purchased credit-impaired(1)	17,424		509		—		8,366		4,550		—		—		30,849
Total	$	401,050	$	34,992	$	97,951	$	84,188	$	130,008	$	3,007	$	47,366	$	798,562

⁽¹⁾Purchased credit-impaired loans are evaluated for impairment on an individual basis.

Financing Receivable Credit Quality Indicators

The following tables detail the carrying value of acquired portfolio loans and leases by portfolio segment based on the credit quality indicators used to determine the Allowance as of September 30, 2018 and December 31, 2017:

Credit Risk Profile by Internally Assigned Grade

	Commercial Mortgage				Construction				Commercial and Industrial				Total
(dollars in thousands)	September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017
Pass	$	339,258	$	376,691	$	16,468	$	66,967	$	87,183	$	124,249	$	442,909	$	567,907
Special Mention	2,321		13,448		934		3,902		227		225		3,482		17,575
Substandard	16,966		10,038		2,400		13,319		17,389		4,624		36,755		27,981
Doubtful	551		873		—		—		—		910		551		1,783
Total	$	359,096	$	401,050	$	19,802	$	84,188	$	104,799	$	130,008	$	483,697	$	615,246

The following tables detail the carrying value of all portfolio loans and leases by portfolio segment based on the credit quality indicators used to determine the Allowance as of September 30, 2018 and December 31, 2017:

Credit Risk Profile by Internally Assigned Grade

	Commercial Mortgage				Construction				Commercial and Industrial				Total
(dollars in thousands)	September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017
Pass	$	1,592,174	$	1,490,862	$	168,897	$	193,227	$	697,913	$	711,145	$	2,458,984	$	2,395,234
Special Mention	2,321		13,448		934		3,902		2,425		889		5,680		18,239
Substandard	23,447		18,194		8,662		15,325		22,660		6,013		54,769		39,532
Doubtful	551		873		—		—		1		1,265		552		2,138
Total	$	1,618,493	$	1,523,377	$	178,493	$	212,454	$	722,999	$	719,312	$	2,519,985	$	2,455,143

Credit Risk Profile by Payment Activity

	Residential Mortgage				Home Equity Lines and Loans				Consumer				Leases				Total
(dollars inthousands)	September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017
Performing	$	464,632	$	454,469	$	205,873	$	216,794	$	47,692	$	38,153	$	137,111	$	115,298	$	855,308	$	824,714
Non-performing	2,770		4,417		1,933		1,481		117		—		1,362		103		6,182		6,001
Total	$	467,402	$	458,886	$	207,806	$	218,275	$	47,809	$	38,153	$	138,473	$	115,401	$	861,490	$	830,715

The following tables detail the carrying value of originated portfolio loans and leases by portfolio segment based on the credit quality indicators used to determine the Allowance as of September 30, 2018 and December 31, 2017:

Credit Risk Profile by Internally Assigned Grade

	Commercial Mortgage				Construction				Commercial and Industrial				Total
(dollars in thousands)	September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017
Pass	$	1,252,916	$	1,114,171	$	152,429	$	126,260	$	610,730	$	586,896	$	2,016,075	$	1,827,327
Special Mention	—		—		—		—		2,198		664		2,198		664
Substandard	6,481		8,156		6,262		2,006		5,271		1,389		18,014		11,551
Doubtful	—		—		—		—		1		355		1		355
Total	$	1,259,397	$	1,122,327	$	158,691	$	128,266	$	618,200	$	589,304	$	2,036,288	$	1,839,897

Credit Risk Profile by Payment Activity

	Residential Mortgage				Home Equity Lines and Loans				Consumer				Leases				Total
(dollars in thousands)	September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017
Performing	$	379,069	$	359,430	$	178,376	$	182,062	$	44,791	$	35,146	$	109,455	$	67,932	$	711,691	$	644,570
Non-performing	1,968		1,505		1,692		1,221		42		—		479		103		4,181		2,829
Total	$	381,037	$	360,935	$	180,068	$	183,283	$	44,833	$	35,146	$	109,934	$	68,035	$	715,872	$	647,399

Schedule of Allowance for Loan Losses by Portfolio Segment

	Residential Mortgage				Home Equity Lines and Loans				Consumer				Leases				Total
(dollars inthousands)	September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017
Performing	$	85,563	$	95,039	$	27,497	$	34,732	$	2,901	$	3,007	$	27,656	$	47,366	$	143,617	$	180,144
Non-performing	802		2,912		241		260		75		—		883		—		2,001		3,172
Total	$	86,365	$	97,951	$	27,738	$	34,992	$	2,976	$	3,007	$	28,539	$	47,366	$	145,618	$	183,316

Troubled Debt Restructurings on Financing Receivables

The following table presents the balance of TDRs as of the indicated dates:

(dollars in thousands)	September 30, 2018		December 31, 2017
TDRs included in nonperforming loans and leases	$	1,208	$	3,289
TDRs in compliance with modified terms	4,316		5,800
Total TDRs	$	5,524	$	9,089

The following table presents information regarding loan and lease modifications categorized as TDRs for the three months ended September 30, 2018:

	For the Three Months Ended September 30, 2018
(dollars in thousands)	Number of Contracts	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
Home equity loans and lines	—	$	—	$	—
Residential mortgages	4	406		430
Leases	—	—		—
Total	4	$	406	$	430

The following table presents information regarding the types of loan and lease modifications made for the three months ended September 30, 2018:

	Number of Contracts
	Loan Term Extension	Interest Rate Change and Term Extension	Interest Rate Change and/or Interest-Only Period	Contractual Payment Reduction (Leases only)	Temporary Payment Deferral
Home equity loans and lines	—	—	—	—	—
Residential mortgages	1	—	—	—	3
Leases	—	—	—	—	—
Total	1	—	—	—	3

The following table presents information regarding loan and lease modifications categorized as TDRs for the nine months ended September 30, 2018: 

	For the Nine Months Ended September 30, 2018
(dollars in thousands)	Number of Contracts	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
Home equity loans and lines	1	$	8	$	8
Residential mortgages	6	625		649
Commercial and industrial	1	18		18
Leases	2	33		33
Total	10	$	684	$	708

The following table presents information regarding the types of loan and lease modifications made for the nine months ended September 30, 2018:

	Number of Contracts
	Loan Term Extension	Interest Rate Change and Term Extension	Interest Rate Change and/or Interest-Only Period	Contractual Payment Reduction (Leases only)	Temporary Payment Deferral
Home equity loans and lines	—	1	—	—	—
Residential mortgages	2	1	—	—	3
Commercial and industrial	—	1	—	—	—
Leases	—	—	—	2	—
Total	2	3	—	2	3

Impaired Financing Receivables

The following tables detail the recorded investment and principal balance of impaired loans by portfolio segment, their related Allowance and interest income recognized for the three and nine months ended September 30, 2018 and 2017 (purchased credit-impaired loans are not included in the tables):

As of and for the Three Months Ended September 30, 2018	Recorded Investment**		Principal Balance		Related Allowance		Average Principal Balance		Interest Income Recognized		Cash-Basis Interest Income Recognized
(dollars in thousands)
Impaired loans with related allowance:
Home equity lines and loans	$	567	$	567	$	19	$	569	$	6	$	—
Residential mortgage	1,699		1,699		228		1,702		20		—
Commercial and industrial	25		25		12		25		—		—
Consumer	58		58		19		58		—		—
Total	$	2,349	$	2,349	$	278	$	2,354	$	26	$	—
Impaired loans without related allowance*:
Commercial mortgage	$	735	$	793	$	—	$	930	$	—	$	—
Home equity lines and loans	2,035		2,096		—		2,064		2		—
Residential mortgage	4,242		4,328		—		4,299		24		—
Construction	291		291		—		294		—		—
Commercial and industrial	1,733		2,665		—		2,138		5		—
Consumer	86		86		—		87		—		—
Total	$	9,122	$	10,259	$	—	$	9,812	$	31	$	—
Grand total	$	11,471	$	12,608	$	278	$	12,166	$	57	$	—

*The table above does not include the recorded investment of $1.4 million of impaired leases without a related Allowance.

**Recorded investment equals principal balance less partial charge-offs and interest payments on non-performing loans that have been applied to principal.

As of and for the Nine Months Ended September 30, 2018	Recorded Investment**		Principal Balance		Related Allowance		Average Principal Balance		Interest Income Recognized		Cash-Basis Interest Income Recognized
(dollars in thousands)
Impaired loans with related allowance:
Home equity lines and loans	$	567	$	567	$	19	$	572	$	17	$	—
Residential mortgage	1,699		1,699		228		1,709		60		—
Commercial and industrial	25		25		12		29		1		—
Consumer	58		58		19		58		1		—
Total	$	2,349	$	2,349	$	278	$	2,368	$	79	$	—
Impaired loans without related allowance*:
Commercial mortgage	$	735	$	793	$	—	$	825	$	6	$	—
Home equity lines and loans	2,035		2,096		—		2,086		10		—
Residential mortgage	4,242		4,328		—		4,228		91		—
Construction	291		291				239		5		—
Commercial and industrial	1,733		2,665		—		2,236		56		—
Consumer	86		86				88		3		—
Total	$	9,122	$	10,259	$	—	$	9,702	$	171	$	—
Grand total	$	11,471	$	12,608	$	278	$	12,070	$	250	$	—

*The table above does not include the recorded investment of $1.4 million of impaired leases without a related Allowance.

**Recorded investment equals principal balance less partial charge-offs and interest payments on non-performing loans that have been applied to principal.

As of and for the Three Months Ended September 30, 2017	Recorded Investment**		Principal Balance		Related Allowance		Average Principal Balance		Interest Income Recognized		Cash-Basis Interest Income Recognized
(dollars in thousands)
Impaired loans with related allowance:
Home equity lines and loans	$	21	$	21	$	3	$	21	$	—	$	—
Residential mortgage	1,770		1,770		116		1,776		23		—
Consumer	27		27		4		28		—		—
Total	$	1,818	$	1,818	$	123	$	1,825	$	23	$	—
Impaired loans without related allowance*:
Commercial mortgage	$	1,449	$	1,485	$	—	$	1,451	$	15	$	—
Home equity lines and loans	633		694		—		655		1		—
Residential mortgage	4,688		5,015		—		4,243		43		—
Commercial and industrial	1,940		2,796		—		2,605		2		—
Total	$	8,710	$	9,990	$	—	$	8,954	$	61	$	—
Grand total	$	10,528	$	11,808	$	123	$	10,779	$	84	$	—

*The table above does not include the recorded investment of $270 thousand of impaired leases without a related Allowance.

**Recorded investment equals principal balance less partial charge-offs and interest payments on non-performing loans that have been applied to principal.

As of and for the Nine Months Ended September 30, 2017	Recorded Investment**		Principal Balance		Related Allowance		Average Principal Balance		Interest Income Recognized		Cash-Basis Interest Income Recognized
(dollars in thousands)
Impaired loans with related allowance:
Home equity lines and loans	$	21	$	21	$	3	$	21	$	1	$	—
Residential mortgage	1,770		1,770		116		1,797		67		—
Consumer	27		27		4		28		1		—
Total	$	1,818	$	1,818	$	123	$	1,846	$	69	$	—
Impaired loans without related allowance*:
Commercial mortgage	$	1,449	$	1,485	$	—	$	1,475	$	45	$	—
Home equity lines and loans	633		694		—		669		5		—
Residential mortgage	4,688		5,015		—		4,288		118		—
Commercial and industrial	1,940		2,796		—		2,746		34		—
Total	$	8,710	$	9,990	$	—	$	9,178	$	202	$	—
Grand total	$	10,528	$	11,808	$	123	$	11,024	$	271	$	—

*The table above does not include the recorded investment of $270 thousand of impaired leases without a related Allowance.

**Recorded investment equals principal balance less partial charge-offs and interest payments on non-performing loans that have been applied to principal.

(dollars in thousands)	Recorded Investment (2)		Principal Balance		Related Allowance
As of December 31, 2017
Impaired loans with related allowance:
Home equity lines and loans	$	577	$	577	$	19
Residential mortgage	2,436		2,435		230
Commercial and industrial	18		19		5
Consumer	27		27		4
Total	$	3,058	$	3,058	$	258
Impaired loans without related allowance(1):
Home equity lines and loans	$	1,585	$	1,645	$	—
Residential mortgage	5,290		5,529		—
Commercial and industrial	1,879		3,613		—
Commercial mortgage	2,128		2,218		—
Total	$	10,882	$	13,005	$	—
Grand total	$	13,940	$	16,063	$	258

⁽¹⁾  The table above does not include the recorded investment of$272 thousandof impaired leases without a related Allowance.

⁽²⁾  Recorded investment equals principal balance less partial charge-offs and interest payments on non-performing loans that have been applied to principal.

Summary of Loans Acquired

The following tables detail, for acquired loans, the outstanding principal, remaining Loan Mark, and recorded investment, by portfolio segment, as of the dates indicated:

	As of September 30, 2018
(dollars in thousands)	Outstanding Principal		Remaining Loan Mark			Recorded Investment
Commercial mortgage	$	369,894	$	(10,798	)	$	359,096
Home equity lines and loans	30,240		(2,502		)	27,738
Residential mortgage	89,302		(2,937		)	86,365
Construction	20,142		(340		)	19,802
Commercial and industrial	111,799		(7,000		)	104,799
Consumer	3,094		(118		)	2,976
Leases	29,793		(1,254		)	28,539
Total	$	654,264	$	(24,949	)	$	629,315

	As of December 31, 2017
(dollars in thousands)	Outstanding Principal		Remaining Loan Mark			Recorded Investment
Commercial mortgage	$	412,263	$	(11,213	)	$	401,050
Home equity lines and loans	37,944		(2,952		)	34,992
Residential mortgage	101,523		(3,572		)	97,951
Construction	86,081		(1,893		)	84,188
Commercial and industrial	141,960		(11,952		)	130,008
Consumer	3,051		(44		)	3,007
Leases	50,530		(3,164		)	47,366
Total	$	833,352	$	(34,790	)	$	798,562

XML

Mortgage Servicing Rights (Tables)

9 Months Ended

Sep. 30, 2018

Transfers and Servicing [Abstract]

Servicing Asset at Amortized Cost

The following table summarizes the Corporation’s activity related to mortgage servicing rights (“MSRs”) for the three and nine months ended September 30, 2018 and 2017:

	Three Months Ended September 30,
(dollars in thousands)	2018			2017
Balance, beginning of period	$	5,511		$	5,682
Additions	—			282
Amortization	(206		)	(229		)
Recovery / (Impairment)	23			(3		)
Balance, end of period	$	5,328		$	5,732
Fair value	$	6,586		$	6,146

	Nine Months Ended September 30,
(dollars in thousands)	2018			2017
Balance, beginning of period	$	5,861		$	5,582
Additions	16			770
Amortization	(623		)	(571		)
Recovery / (Impairment)	74			(49		)
Balance, end of period	$	5,328		$	5,732
Fair value	$	6,586		$	6,146
Residential mortgage loans serviced for others	$	596,162		$	647,997

Schedule of Sensitivity Analysis of Fair Value, Transferor's Interests in Transferred Financial Assets

As of September 30, 2018, and December 31, 2017, key economic assumptions and the sensitivity of the current fair value of MSRs to immediate 10% and 20% adverse changes in those assumptions are as follows:

(dollars in thousands)	September 30, 2018			December 31, 2017
Fair value amount of MSRs	$	6,586		$	6,397
Weighted average life (in years)	6.6			6.1
Prepayment speeds (constant prepayment rate)*	8.7		%	10.3		%
Impact on fair value:
10% adverse change	$	(85	)	$	(194	)
20% adverse change	$	(190	)	$	(394	)
Discount rate	9.55		%	9.55		%
Impact on fair value:
10% adverse change	$	(245	)	$	(225	)
20% adverse change	$	(472	)	$	(434	)

*Represents the weighted average prepayment rate for the life of the MSR asset.

XML

Goodwill and Intangibles Assets (Tables)

9 Months Ended

Sep. 30, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Intangible Assets and Goodwill

The following table presents activity in the Corporation's goodwill by its reporting units and finite-lived and indefinite-lived intangible assets, other than MSRs, for the nine months ended September 30, 2018:

(dollars in thousands)	Balance December 31, 2017		Additions		Adjustments		Amortization			Balance September 30, 2018		Amortization Period
Goodwill – Wealth	$	20,412	$	—	$	—	$	—		$	20,412	Indefinite
Goodwill – Banking	153,545		—		3,298		—			156,843		Indefinite
Goodwill – Insurance	5,932		677		—		—			6,609		Indefinite
Total Goodwill	$	179,889	$	677	$	3,298	$	—		$	183,864
Core deposit intangible	$	7,380	$	—	$	—	$	(1,108	)	$	6,272	10 years
Customer relationships	14,173		994		—		(1,271		)	13,896		10 to 20 years
Non-compete agreements	1,319		—		—		(171		)	1,148		5 to 10 years
Trade name	2,322		—		—		(49		)	2,273		3 years to Indefinite
Domain name	151		—		—		—			151		Indefinite
Favorable lease assets	621		—		—		(60		)	561		1 to 16 years
Total Intangible Assets	$	25,966	$	994	$	—	$	(2,659	)	$	24,301
Total Goodwill and Intangible Assets	$	205,855	$	1,671	$	3,298	$	(2,659	)	$	208,165

XML

Deposits (Tables)

9 Months Ended

Sep. 30, 2018

Deposits [Abstract]

Summary of Deposits

The following table details the components of deposits:

	September 30, 2018		December 31, 2017
(dollars in thousands)
Interest-bearing demand	$	578,243	$	481,336
Money market	812,027		862,639
Savings	286,266		338,572
Retail time deposits	561,123		532,202
Wholesale non-maturity deposits	24,040		62,276
Wholesale time deposits	261,164		171,929
Total interest-bearing deposits	$	2,522,863	$	2,448,954
Noninterest-bearing deposits	834,363		924,844
Total deposits	$	3,357,226	$	3,373,798

XML

Short-Term Borrowings and Long-Term FHLB Advances (Tables)

9 Months Ended

Sep. 30, 2018

Long-term Federal Home Loan Bank Advances [Abstract]

Schedule of Short-term Debt

A summary of short-term borrowings is as follows:

(dollars in thousands)	September 30, 2018		December 31, 2017
Repurchase agreements* – commercial customers	$	21,548	$	25,865
Short-term FHLB advances	204,950		212,000
Total short-term borrowings	$	226,498	$	237,865

* Overnight repurchase agreements with no expiration date

Schedule of Additional Information on Short Term Borrowings

The following table sets forth information concerning short-term borrowings:

	Three Months Ended September 30,						Nine Months Ended September 30,
(dollars in thousands)	2018			2017			2018			2017
Balance at period-end	$	226,498		$	180,874		$	226,498		$	180,874
Maximum amount outstanding at any month end	$	302,932		$	184,578		$	302,932		$	184,578
Average balance outstanding during the period	$	218,551		$	182,845		$	205,046		$	110,268
Weighted-average interest rate:
As of the period-end	2.18		%	1.17		%	2.18		%	1.17		%
Paid during the period	2.09		%	1.19		%	1.85		%	0.98		%

Schedule of Maturities of Long-term Debt

The following table presents the remaining periods until maturity of long-term FHLB advances:

(dollars in thousands)	September 30, 2018		December 31, 2017
Within one year	$	28,106	$	83,766
Over one year through five years	44,735		55,374
Total	$	72,841	$	139,140

Schedule of Federal Home Loan Bank Advances and Other Borrowings Maturities

The following table presents rate and maturity information on FHLB advances and other borrowings: 

	Maturity Range(1)		Weighted Average Rate(1)		Coupon Rate(1)				Balance at
Description	From	To			From		To		September 30, 2018		December 31, 2017
Bullet maturity – fixed rate	10/1/2018	1/2/2020	1.32	%	1.31	%	2.45	%	$	72,841	$	118,131
Convertible-fixed(2)	N/A	N/A	N/A		N/A		N/A		—		21,009
Total									$	72,841	$	139,140

(1)Maturity range, weighted average rate and coupon rate range refers to September 30, 2018balances.

(2)FHLB advances whereby the FHLB has the option, at predetermined times, to convert the fixed interest rate to an adjustable interest rate indexed to the London Interbank Offered Rate (“LIBOR”). The Corporation has the option to prepay these advances, without penalty, if the FHLB elects to convert the interest rate to an adjustable rate. As of September 30, 2018, the Corporation held no FHLB advances with this convertible feature

XML

Subordinated Notes (Tables)

9 Months Ended

Sep. 30, 2018

Subordinated Debt [Abstract]

Schedule of Long-term Debt Instruments

The following tables detail the subordinated notes, including debt issuance costs, as of September 30, 2018, and December 31, 2017:

	September 30, 2018				December 31, 2017
(dollars in thousands)	Balance		Rate(1)(2)		Balance		Rate(1)(2)
Subordinated notes – due 2027	$	68,855	4.25	%	$	68,829	4.25	%
Subordinated notes – due 2025	29,627		4.75	%	29,587		4.75	%
Total subordinated notes	$	98,482			$	98,416

(1)The 2027 Notes bear interest at an annual fixed rate of 4.25% from the date of issuance until December 14, 2022, and will thereafter bear interest at a variable rate that will reset quarterly to a level equal to the then-current three-month LIBOR rate plus 2.050% until December 15, 2027, or any early redemption date.

(2)The 2025 Notes bear interest at an annual fixed rate of 4.75% from the date of issuance until August 14, 2020, and will thereafter bear interest at a variable rate that will reset quarterly to a level equal to the then-current three-month LIBOR rate plus 3.068% until August 15, 2025, or any early redemption date.

XML

Derivative Instruments and Hedging Activities (Tables)

9 Months Ended

Sep. 30, 2018

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

The following tables detail the derivative instruments as of September 30, 2018 and December 31, 2017:

	Asset Derivatives				Liability Derivatives
(dollars in thousands)	Notional Amount		Fair Value		Notional Amount		Fair Value
Derivatives not designated as hedging instruments
As of September 30, 2018:
Customer derivatives – interest rate swaps	$	295,566	$	5,843	$	295,566	$	5,843
RPAs sold	—		—		865		1
RPAs purchased	35,464		43		—		—
Total derivatives	$	331,030	$	5,886	$	296,431	$	5,844
As of December 31, 2017:
Customer derivatives – interest rate swaps	$	124,627	$	1,895	$	124,627	$	1,895
RPAs sold	—		—		899		3
RPAs purchased	14,710		21		—		—
Total derivatives	$	139,337	$	1,916	$	125,526	$	1,898

XML

Accumulated Other Comprehensive (Loss) Income (Tables)

9 Months Ended

Sep. 30, 2018

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Schedule of Accumulated Other Comprehensive Income (Loss)

The following table details the components of accumulated other comprehensive (loss) income for the three and nine month periods ended September 30, 2018 and 2017:

(dollars in thousands)	Net Change in Unrealized Gains on Available-for- Sale Investment Securities			Net Change in Unfunded Pension Liability			Accumulated Other Comprehensive Loss
Balance, June 30, 2018	$	(9,669	)	$	(1,522	)	$	(11,191	)
Other comprehensive (loss) income	(2,319		)	108			(2,211		)
Balance, September 30, 2018	$	(11,988	)	$	(1,414	)	$	(13,402	)
Balance, June 30, 2017	$	(433	)	$	(1,131	)	$	(1,564	)
Other comprehensive income	149			15			164
Balance, September 30, 2017	$	(284	)	$	(1,116	)	$	(1,400	)

(dollars in thousands)	Net Change in Unrealized Gains on Available-for- Sale Investment Securities			Net Change in Unfunded Pension Liability			Accumulated Other Comprehensive Loss
Balance, December 31, 2017	$	(2,861	)	$	(1,553	)	$	(4,414	)
Other comprehensive (loss) income	(9,127		)	139			(8,988		)
Balance, September 30, 2018	$	(11,988	)	$	(1,414	)	$	(13,402	)
Balance, December 31, 2016	$	(1,231	)	$	(1,178	)	$	(2,409	)
Other comprehensive income	947			62			1,009
Balance, September 30, 2017	$	(284	)	$	(1,116	)	$	(1,400	)

Reclassification out of Accumulated Other Comprehensive Income

The following table details the amounts reclassified from each component of accumulated other comprehensive loss to each component’s applicable income statement line, for the three and nine month periods ended September 30, 2018 and 2017:

	Amount Reclassified from Accumulated Other Comprehensive Loss
Description of Accumulated Other Comprehensive Loss Component	Three Months Ended September 30,				Affected Income Statement Category
	2018		2017
Net unrealized gain on investment securities available for sale:
Realization of gain on sale of investment securities available for sale	$	—	$	72	Net gain on sale of available for sale investment securities
Realization of gain on transfer of investment securities available for sale to trading	—		—		Other operating income
Total	$	—	$	72
Income tax effect	—		25		Income tax expense
Net of income tax	$	—	$	47	Net income
Unfunded pension liability:
Amortization of net loss included in net periodic pension costs*	$	25	$	24	Other operating expenses
Income tax effect	5		8		Income tax expense
Net of income tax	$	20	$	16	Net income

	Amount Reclassified from Accumulated Other Comprehensive Loss
Description of Accumulated Other Comprehensive Loss Component	Nine Months Ended September 30,				Affected Income Statement Category
	2018		2017
Net unrealized gain on investment securities available for sale:
Realization of gain on sale of investment securities available for sale	$	7	$	73	Net gain on sale of available for sale investment securities
Realization of gain on transfer of investment securities available for sale to trading	417		—		Other operating income
Total	$	424	$	73
Income tax effect	89		27		Income tax expense
Net of income tax	$	335	$	46	Net income
Unfunded pension liability:
Amortization of net loss included in net periodic pension costs*	$	75	$	71	Other operating expenses
Income tax effect	15		25		Income tax expense
Net of income tax	$	60	$	46	Net income

*Accumulated other comprehensive loss components are included in the computation of net periodic pension cost.

XML

Earnings per Common Share (Tables)

9 Months Ended

Sep. 30, 2018

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted

	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands except share and per share data)	2018		2017		2018		2017
Numerator:
Net income available to common shareholders	$	16,682	$	10,739	$	46,656	$	29,216
Denominator for basic earnings per share – weighted average shares outstanding	20,270,706		17,023,046		20,237,757		16,987,499
Effect of dilutive common shares	167,670		230,936		206,318		254,728
Denominator for diluted earnings per share – adjusted weighted average shares outstanding	20,438,376		17,253,982		20,444,075		17,242,227
Basic earnings per share	$	0.82	$	0.63	$	2.31	$	1.72
Diluted earnings per share	$	0.82	$	0.62	$	2.28	$	1.69
Antidilutive shares excluded from computation of average dilutive earnings per share	22,232		21,621		48,807		47,268

XML

Revenue from Contracts with Customers (Tables)

9 Months Ended

Sep. 30, 2018

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue

The following table presents the Corporation’s noninterest income by revenue stream and reportable segment for the three and nine months ended September 30, 2018 and 2017.  Items outside the scope of ASC 606 are noted as such.

	Three Months Ended September 30, 2018						Three Months Ended September 30, 2017
(dollars in thousands)	Banking		Wealth Management		Consolidated		Banking		Wealth Management		Consolidated
Fees for wealth management services	$	—	$	10,343	$	10,343	$	—	$	9,651	$	9,651
Insurance commissions	—		1,754		1,754		—		1,373		1,373
Capital markets revenue(1)	710		—		710		843		—		843
Service charges on deposit accounts	726		—		726		676		—		676
Loan servicing and other fees(1)	559		—		559		548		—		548
Net gain on sale of loans(1)	631		—		631		799		—		799
Net gain on sale of investment securities available for sale(1)	—		—		—		72		—		72
Net gain on sale of other real estate owned	5		—		5		—		—		—
Dividends on FHLB and FRB stock(1)	375		—		375		217		—		217
Other operating income(2)	3,123		48		3,171		1,364		41		1,405
Total noninterest income	$	6,129	$	12,145	$	18,274	$	4,519	$	11,065	$	15,584

(1) Not within the scope of ASC 606.

(2) Other operating income includes Visa debit card income, safe deposit box rentals, and rent income totaling $595 thousand and $520 thousand for the three months ended September 30, 2018 and 2017, respectively, which are within the scope of ASC 606.

	Nine Months Ended September 30, 2018						Nine Months Ended September 30, 2017
(dollars in thousands)	Banking		Wealth Management		Consolidated		Banking			Wealth Management		Consolidated
Fees for wealth management services	$	—	$	31,309	$	31,309	$	—		$	28,761	$	28,761
Insurance commissions	—		5,349		5,349		—			3,079		3,079
Capital markets revenue(1)	3,481		—		3,481		1,796			—		1,796
Service charges on deposit accounts	2,191		—		2,191		1,953			—		1,953
Loan servicing and other fees(1)	1,720		—		1,720		1,570			—		1,570
Net gain on sale of loans(1)	1,677		—		1,677		1,948			—		1,948
Net gain on sale of investment securities available for sale(1)	7		—		7		73			—		73
Net gain (loss) on sale of other real estate owned	292		—		292		(12		)	—		(12		)
Dividends on FHLB and FRB stock(1)	1,316		—		1,316		649			—		649
Other operating income(2)	10,393		150		10,543		3,641			138		3,779
Total noninterest income	$	21,077	$	36,808	$	57,885	$	11,618		$	31,978	$	43,596

(1) Not within the scope of ASC 606.

(2) Other operating income includes Visa debit card income, safe deposit box rentals, and rent income totaling $1.7 million and $1.5 million for the nine months ended September 30, 2018 and 2017, respectively, which are within the scope of ASC 606.

XML

Stock-based Compensation (Tables)

9 Months Ended

Sep. 30, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Share-based Compensation, Stock Options, Activity

The following table provides information about options outstanding for the three months ended September 30, 2018:

	Shares		Weighted Average Exercise Price		Weighted Average Grant Date Fair Value
Options outstanding, June 30, 2018	66,571		$	19.26	$	4.71
Forfeited	—		—		—
Expired	—		—		—
Exercised	(15,150	)	$	23.02	$	5.09
Options outstanding, September 30, 2018	51,421		$	18.15	$	4.60

The following table provides information about options outstanding for the nine months ended September 30, 2018:

	Shares		Weighted Average Exercise Price		Weighted Average Grant Date Fair Value
Options outstanding, December 31, 2017	115,246		$	20.73	$	4.86
Forfeited	—		—		—
Expired	—		—		—
Exercised	(63,825	)	$	22.81	$	5.06
Options outstanding, September 30, 2018	51,421		$	18.15	$	4.60

Schedule of Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Grant Date Intrinsic Value

Proceeds, related tax benefits realized from options exercised and intrinsic value of options exercised were as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2018		2017		2018		2017
Proceeds from exercise of stock options	$	349	$	283	$	1,456	$	1,288
Related tax benefit recognized	81		96		312		402
Net proceeds of options exercised	$	430	$	379	$	1,768	$	1,690
Intrinsic value of options exercised	$	386	$	273	$	1,484	$	1,147

Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding and Exercisable

The following table provides information about options outstanding and exercisable at September 30, 2018:

(dollars in thousands, except share data and exercise price)	Outstanding		Exercisable
Number of shares	51,421		51,421
Weighted average exercise price	$	18.15	$	18.15
Aggregate intrinsic value	$	1,478	$	1,478
Weighted average remaining contractual term in years	0.9		0.9

Schedule of Nonvested Restricted Stock Units Activity

The following table details the RSUs for the three and nine months ended September 30, 2018:

	Three Months Ended September 30, 2018				Nine Months Ended September 30, 2018
	Number of Shares		Weighted Average Grant Date Fair Value		Number of Shares		Weighted Average Grant Date Fair Value
Beginning balance	68,595		$	36.89	75,707		$	35.80
Granted	23,843		$	46.29	26,243		$	46.07
Vested	(16,122	)	$	33.65	(24,469	)	$	32.16
Forfeited	—		$	—	(1,165	)	$	35.36
Ending balance	76,316		$	40.51	76,316		$	40.51

Schedule of Nonvested Performance-based Units Activity

The following table details the PSUs for the three and nine months ended September 30, 2018:

	Three Months Ended September 30, 2018				Nine Months Ended September 30, 2018
	Number of Shares		Weighted Average Grant Date Fair Value		Number of Shares		Weighted Average Grant Date Fair Value
Beginning balance	130,260		$	26.73	168,453		$	24.76
Granted	40,722		$	44.56	40,722		$	44.56
Vested	(48,056	)	$	16.04	(81,840	)	$	16.40
Forfeited	—		$	—	(4,409	)	$	26.57
Ending balance	122,926		$	36.82	122,926		$	36.82

XML

Fair Value Measurement (Tables)

9 Months Ended

Sep. 30, 2018

Fair Value Disclosures [Abstract]

Fair Value, Assets Measured on Recurring and Nonrecurring Basis

The following tables present the Corporation’s assets measured at fair value on a non-recurring basis as of September 30, 2018 and December 31, 2017:

As of September 30, 2018
(dollars in thousands)	Total		Level 1		Level 2		Level 3
MSRs	$	6,586	$	—	$	—	$	6,586
Impaired loans and leases	12,593		—		—		12,593
OREO	529		—		—		529
Total non-recurring fair value measurements	$	19,708	$	—	$	—	$	19,708

The following tables present the Corporation’s assets measured at fair value on a recurring basis as of September 30, 2018 and December 31, 2017:

As of September 30, 2018
(dollars in thousands)	Total		Level 1		Level 2		Level 3
Investment securities available for sale:
U.S. Treasury securities	$	100	$	100	$	—	$	—
Obligations of U.S. government & agencies	190,453		—		190,453		—
Obligations of state & political subdivisions	15,799		—		15,799		—
Mortgage-backed securities	284,421		—		284,421		—
Collateralized mortgage obligations	36,193		—		36,193		—
Other investment securities	1,098		—		1,098		—
Total investment securities available for sale	$	528,064	$	100	$	527,964	$	—
Investment securities trading:
Mutual funds	$	8,340	$	8,340	$	—	$	—
Derivatives:
Interest rate swaps	$	5,886	$	—	$	5,886	$	—
Total recurring fair value measurements	$	542,290	$	8,440	$	533,850	$	—

As of December 31, 2017
(dollars in thousands)	Total		Level 1		Level 2		Level 3
Investment securities available for sale:
U.S. Treasury securities	$	200,088	$	200,088	$	—	$	—
Obligations of U.S. government & agencies	151,044		—		151,044		—
Obligations of state & political subdivisions	21,310		—		21,310		—
Mortgage-backed securities	274,990		—		274,990		—
Collateralized mortgage obligations	36,662		—		36,662		—
Mutual funds	3,509		3,509		—		—
Other investment securities	1,599		—		1,599		—
Total investment securities available for sale	$	689,202	$	203,597	$	485,605	$	—
Investment securities trading:
Mutual funds	$	4,610	$	4,610	$	—	$	—
Derivatives:
Interest rate swaps	$	1,898	$	—	$	1,898	$	—
Total recurring fair value measurements	$	695,710	$	208,207	$	487,503	$	—

As of December 31, 2017
(dollars in thousands)	Total		Level 1		Level 2		Level 3
MSRs	$	6,397	$	—	$	—	$	6,397
Impaired loans and leases	13,954		—		—		13,954
OREO	304		—		—		304
Total non-recurring fair value measurements	$	20,655	$	—	$	—	$	20,655

XML

Fair Value of Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2018

Fair Value Disclosures [Abstract]

Summary of Fair Value by Balance Sheet Grouping

The carrying amount and fair value of the Corporation’s financial instruments are as follows:

		As of September 30, 2018				As of December 31, 2017
(dollars in thousands)	Fair Value Hierarchy Level*	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Financial assets:
Cash and cash equivalents	Level 1	$	45,354	$	45,354	$	60,024	$	60,024
Investment securities - available for sale	See Note 19	528,064		528,064		689,202		689,202
Investment securities - trading	See Note 19	8,340		8,340		4,610		4,610
Investment securities – held to maturity	Level 2	8,916		8,544		7,932		7,851
Loans held for sale	Level 2	4,111		4,111		3,794		3,794
Net portfolio loans and leases	Level 3	3,362,791		3,362,757		3,268,333		3,293,802
MSRs	Level 3	5,328		6,586		5,861		6,397
Interest rate swaps	Level 2	5,843		5,843		1,895		1,895
RPAs purchased	Level 2	43		43		21		21
Other assets	Level 3	44,439		44,439		46,799		46,799
Total financial assets		$	4,013,229	$	4,014,081	$	4,088,471	$	4,114,395
Financial liabilities:
Deposits	Level 2	$	3,357,226	$	3,351,183	$	3,373,798	$	3,368,276
Short-term borrowings	Level 2	226,498		226,498		237,865		237,865
Long-term FHLB advances	Level 2	72,841		71,978		139,140		138,685
Subordinated notes	Level 2	98,482		97,892		98,416		95,044
Junior subordinated debentures	Level 2	21,538		23,564		21,416		19,366
Interest rate swaps	Level 2	5,843		5,843		1,895		1,895
RPAs sold	Level 2	1		1		3		3
Other liabilities	Level 3	60,432		60,432		49,071		49,071
Total financial liabilities		$	3,842,861	$	3,837,391	$	3,921,604	$	3,910,205

* See Note 19 in the Notes to Unaudited Consolidated Financial Statements above for a description of hierarchy levels.

XML

Segment Information (Tables)

9 Months Ended

Sep. 30, 2018

Segment Reporting [Abstract]

Schedule of Segment Reporting Information, by Segment

The following tables detail the Corporation’s segments for the three and nine months ended September 30, 2018 and 2017:

	Three Months Ended September 30, 2018									Three Months Ended September 30, 2017
(dollars in thousands)	Banking			Wealth Management			Consolidated			Banking			Wealth Management			Consolidated
Net interest income	$	36,726		$	3		$	36,729		$	29,437		$	1		$	29,438
Provision for loan and lease losses	664			—			664			1,333			—			1,333
Net interest income after loan loss provision	36,062			3			36,065			28,104			1			28,105
Noninterest income:
Fees for wealth management services	—			10,343			10,343			—			9,651			9,651
Insurance commissions	—			1,754			1,754			—			1,373			1,373
Capital markets revenue	710			—			710			843			—			843
Service charges on deposit accounts	726			—			726			676			—			676
Loan servicing and other fees	559			—			559			548			—			548
Net gain on sale of loans	631			—			631			799			—			799
Net gain on sale of investment securities available for sale	—			—			—			72			—			72
Net gain on sale of OREO	5			—			5			—			—			—
Other operating income	3,498			48			3,546			1,581			41			1,622
Total noninterest income	6,129			12,145			18,274			4,519			11,065			15,584
Noninterest expenses:
Salaries & wages	11,737			4,791			16,528			9,130			4,472			13,602
Employee benefits	2,394			962			3,356			1,587			973			2,560
Occupancy and bank premises	2,224			493			2,717			2,049			436			2,485
Amortization of intangible assets	386			505			891			197			480			677
Professional fees	889			108			997			681			58			739
Other operating expenses	7,770			1,333			9,103			6,970			1,151			8,121
Total noninterest expenses	25,400			8,192			33,592			20,614			7,570			28,184
Segment profit	16,791			3,956			20,747			12,009			3,496			15,505
Intersegment (revenues) expenses*	(186		)	186			—			(112		)	112			—
Pre-tax segment profit after eliminations	$	16,605		$	4,142		$	20,747		$	11,897		$	3,608		$	15,505
% of segment pre-tax profit after eliminations	80.0		%	20.0		%	100.0		%	76.7		%	23.3		%	100.0		%
Segment assets (dollars in millions)	$	4,335.8		$	52.6		$	4,388.4		$	3,424.8		$	52.0		$	3,476.8

	Nine Months Ended September 30, 2018									Nine Months Ended September 30, 2017
(dollars in thousands)	Banking			Wealth Management			Consolidated			Banking			Wealth Management			Consolidated
Net interest income	$	111,479		$	5		$	111,484		$	84,804		$	2		$	84,806
Provision for loan and lease losses	4,831			—			4,831			1,541			—			1,541
Net interest income after loan loss provision	106,648			5			106,653			83,263			2			83,265
Noninterest income:
Fees for wealth management services	—			31,309			31,309			—			28,761			28,761
Insurance commissions	—			5,349			5,349			—			3,079			3,079
Capital markets revenue	3,481			—			3,481			1,796			—			1,796
Service charges on deposit accounts	2,191			—			2,191			1,953			—			1,953
Loan servicing and other fees	1,720			—			1,720			1,570			—			1,570
Net gain on sale of loans	1,677			—			1,677			1,948			—			1,948
Net gain on sale of investment securities available for sale	7			—			7			73			—			73
Net gain (loss) gain on sale of OREO	292			—			292			(12		)	—			(12		)
Other operating income	11,709			150			11,859			4,290			138			4,428
Total noninterest income	21,077			36,808			57,885			11,618			31,978			43,596
Noninterest expenses:
Salaries & wages	34,077			14,673			48,750			27,044			12,588			39,632
Employee benefits	6,992			2,949			9,941			4,565			2,888			7,453
Occupancy and bank premises	7,035			1,429			8,464			6,025			1,233			7,258
Amortization of intangible assets	1,169			1,490			2,659			588			1,469			2,057
Professional fees	2,497			180			2,677			2,318			181			2,499
Other operating expenses	29,076			3,891			32,967			21,200			3,240			24,440
Total noninterest expenses	80,846			24,612			105,458			61,740			21,599			83,339
Segment profit	46,879			12,201			59,080			33,141			10,381			43,522
Intersegment (revenues) expenses*	(485		)	485			—			(336		)	336			—
Pre-tax segment profit after eliminations	$	46,394		$	12,686		$	59,080		$	32,805		$	10,717		$	43,522
% of segment pre-tax profit after eliminations	78.5		%	21.5		%	100.0		%	75.4		%	24.6		%	100.0		%
Segment assets (dollars in millions)	$	4,335.8		$	52.6		$	4,388.4		$	3,424.8		$	52.0		$	3,476.8

*Inter-segment revenues consist of rental payments, interest on deposits and management fees.

Wealth Management Segment Information

(dollars in millions)	September 30, 2018		December 31, 2017
Assets under management, administration, supervision and brokerage	$	13,913.3	$	12,968.7

XML

Basis of Presentation Basis of Presentation (Details)	9 Months Ended
	Sep. 30, 2018 trust
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of trusts acquired	2

XML

Business Combinations - Narrative (Details)				3 Months Ended
	May 01, 2018 USD ($) payment	Dec. 15, 2017 USD ($) shares	May 24, 2017 USD ($) payment	Sep. 30, 2018 USD ($)	Jun. 30, 2018 payment	Mar. 31, 2018 USD ($)
Domenick
Business Acquisition [Line Items]
Consideration paid	$ 1,456,000
Cash paid at closing	$ 750,000
Number of contingent cash payments | payment	3
Maximum contingent payment per period	$ 250,000
RBPI
Business Acquisition [Line Items]
Consideration paid		$ 138,740,000
Shares issued (in shares) | shares		3,101,316
Cash in lieu of fractional shares		$ 7,000
Cash-out of certain options		$ 112,000
Warrants converted by acquirer | shares		1,368,040
Fair value of warrants assumed		$ 1,853,000
Number of securities called by warrants | shares		140,224
Goodwill, expected tax deductible amount		$ 0
Loans held for investment, increase in nonaccretable difference				$ 1,600,000		$ 3,000,000
Certain loans acquired in transfer accounted for as debt securities, accretable yield, period increase (decrease)						$ 325,000
RBPI | Common Class A
Business Acquisition [Line Items]
Conversion ratio of shares in acquirer		0.1025
RBPI | Common Class B
Business Acquisition [Line Items]
Conversion ratio of shares in acquirer		0.1179
Hirshorn
Business Acquisition [Line Items]
Consideration paid			$ 7,460,000
Cash paid at closing			$ 5,770,000
Number of contingent cash payments | payment			2
Number of contingent cash payments made | payment					1
Contingent consideration, maximum amount of installment payment per period			$ 575,000

XML

Business Combinations - Schedules of Assets and Liabilities Assumed (Details) - USD ($) $ in Thousands	May 01, 2018	Dec. 15, 2017	May 24, 2017	Sep. 30, 2018	Dec. 31, 2017
Liabilities assumed:
Goodwill				$ 183,864	$ 179,889
Domenick
Consideration paid:
Cash paid at closing	$ 750
Contingent payment liability (present value)	706
Value of consideration	1,456
Assets acquired:
Cash and due from banks	370
Premises and equipment	1
Other assets	316
Total assets	1,466
Liabilities assumed:
Accounts payable	657
Other liabilities	30
Total liabilities	687
Net assets acquired	779
Goodwill	677
Domenick | Customer Relationships
Assets acquired:
Intangible assets	$ 779
RBPI
Consideration paid:
Common shares issued (3,101,316)		$ 136,768
Cash in lieu of fractional shares		7
Cash-out of certain options		112
Fair value of warrants assumed		1,853
Value of consideration		$ 138,740
Shares issued (in shares)		3,101,316
Assets acquired:
Cash and due from banks		$ 17,092
Premises and equipment		8,264
Other assets		13,996
Investment securities available for sale		121,587
Loans		566,228
Deferred income taxes		34,586
Bank-owned life insurance		16,550
Total assets		783,539
Liabilities assumed:
Other liabilities		31,381
Deposits		593,172
FHLB and other long-term borrowings		59,568
Short-term borrowings		15,000
Junior subordinated debentures		21,416
Unfavorable lease liability		322
Total liabilities		720,859
Net assets acquired		62,680
Goodwill		76,060		$ 76,060	$ 72,762
RBPI | Core Deposits
Assets acquired:
Intangible assets		4,670
RBPI | Off-Market Favorable Lease
Assets acquired:
Intangible assets		$ 566
Hirshorn
Consideration paid:
Cash paid at closing			$ 5,770
Contingent payment liability (present value)			1,690
Value of consideration			7,460
Assets acquired:
Cash and due from banks			978
Premises and equipment			1,795
Other assets			27
Accounts receivable			192
Total assets			5,900
Liabilities assumed:
Accounts payable			800
Other liabilities			2
Total liabilities			802
Net assets acquired			5,098
Goodwill			2,362
Hirshorn | Customer Relationships
Assets acquired:
Intangible assets			2,672
Hirshorn | Trade Names
Assets acquired:
Intangible assets			195
Hirshorn | Noncompete Agreements
Assets acquired:
Intangible assets			$ 41

XML

Business Combinations - Provisional Estimates of Fair Value of Certain Assets Acquired (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2018 USD ($) shares
Goodwill [Roll Forward]
Balance December 31, 2017	$ 179,889
Balance September 30, 2018	183,864
RBPI
Goodwill [Roll Forward]
Balance December 31, 2017	72,762
Common shares issued (2,562)	$ 113
Common shares issued (in shares) | shares	2,562
Loans	$ 4,145
Other assets	491
Deferred income taxes	(1,451)
Total Fair Value Adjustments	3,185
Balance September 30, 2018	$ 76,060

XML

Business Combinations - Acquired Impaired Loans (Details) - RBPI $ in Thousands	Dec. 15, 2017 USD ($)
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities Acquired During Period [Line Items]
Contractually required principal and interest payments	$ 40,741
Contractual cash flows not expected to be collected (nonaccretable difference)	(17,637)
Cash flows expected to be collected	23,104
Interest component of expected cash flows (accretable yield)	(2,644)
Fair value of loans acquired with deterioration of credit quality	$ 20,460

XML

Business Combinations - Pro Forma Income Statements (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Total interest income	$ 45,233	$ 33,198	$ 133,521	$ 94,761
Total interest expense	8,504	3,760	22,037	9,955
Net interest income	36,729	29,438	111,484	84,806
Net interest income after provision for loan and lease losses	36,065	28,105	106,653	83,265
Total noninterest income	18,274	15,584	57,885	43,596
Total non-interest expense	33,592	28,184	105,458	83,339
Income before income taxes	20,747	15,505	59,080	43,522
Income tax expense	4,066	4,766	12,419	14,306
Net income attributable to Bryn Mawr Bank Corporation	$ 16,682	$ 10,739	$ 46,656	$ 29,216
Weighted-average basic shares outstanding (in shares)	20,270,706	17,023,046	20,237,757	16,987,499
Dilutive shares	167,670	230,936	206,318	254,728
Denominator for diluted earnings per share – adjusted weighted average shares outstanding	20,438,376	17,253,982	20,444,075	17,242,227
Basic earnings per share (in dollars per share)	$ 0.82	$ 0.63	$ 2.31	$ 1.72
Diluted earnings per share (in dollars per share)	$ 0.82	$ 0.62	$ 2.28	$ 1.69
Pro Forma
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items]
Total interest income		$ 43,412		$ 126,976
Total interest expense		5,480		15,013
Net interest income		37,932		111,963
Provision for loan and lease losses		1,492		2,054
Net interest income after provision for loan and lease losses		36,440		109,909
Total noninterest income		16,015		45,481
Total non-interest expense		33,364		99,699
Income before income taxes		19,091		55,691
Income tax expense		5,843		18,306
Net income attributable to Bryn Mawr Bank Corporation		$ 13,248		$ 37,385
Weighted-average basic shares outstanding (in shares)		20,121,800		20,086,253
Dilutive shares		261,935		284,294
Denominator for diluted earnings per share – adjusted weighted average shares outstanding		20,383,735		20,370,547
Basic earnings per share (in dollars per share)		$ 0.66		$ 1.86
Diluted earnings per share (in dollars per share)		$ 0.65		$ 1.84

XML

Business Combinations - Due Diligence, Merger-related and Merger Integration Costs (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Business Combinations [Abstract]
Advertising	$ 0	$ 89	$ 61	$ 108
Employee Benefits	0	5	271	10
Occupancy and bank premises	0	0	2,145	0
Furniture, fixtures, and equipment	0	31	365	37
Information technology	167	41	421	300
Professional fees	193	632	1,450	1,570
Salaries and wages	29	28	852	428
Other	0	24	2,196	144
Total due diligence, merger-related and merger integration expenses	$ 389	$ 850	$ 7,761	$ 2,597

XML

Investment Securities - Amortized Cost and Fair Value of Securities Available for Sale (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	$ 543,240	$ 692,824
Gross Unrealized Gains	362	1,316
Gross Unrealized Losses	(15,538)	(4,938)
Fair Value	528,064	689,202
U.S. Treasury securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	100	200,077
Gross Unrealized Gains	0	11
Gross Unrealized Losses	0	0
Fair Value	100	200,088
Obligations of the U.S. government and agencies
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	196,334	153,028
Gross Unrealized Gains	17	75
Gross Unrealized Losses	(5,898)	(2,059)
Fair Value	190,453	151,044
Obligations of state and political subdivisions
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	15,890	21,352
Gross Unrealized Gains	1	11
Gross Unrealized Losses	(92)	(53)
Fair Value	15,799	21,310
Mortgage-backed securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	292,005	275,958
Gross Unrealized Gains	344	887
Gross Unrealized Losses	(7,928)	(1,855)
Fair Value	284,421	274,990
Collateralized mortgage obligations
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	37,811	37,596
Gross Unrealized Gains	0	14
Gross Unrealized Losses	(1,618)	(948)
Fair Value	36,193	36,662
Other investment securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	1,100	4,813
Gross Unrealized Gains	0	318
Gross Unrealized Losses	(2)	(23)
Fair Value	$ 1,098	$ 5,108

XML

Investment Securities - Securities Available for Sale in an Unrealized Loss Position (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Fair Value
Securities available for sale, less than 12 months, fair value	$ 240,854	$ 310,154
Securities available for sale, 12 months or longer, fair value	265,367	87,908
Securities available for sale, fair value	506,221	398,062
Unrealized Losses
Securities available for sale, less than 12 months, unrealized losses	(4,779)	(2,686)
Securities available for sale, 12 months or longer, unrealized losses	(10,759)	(2,252)
Securities available for sale, unrealized losses	(15,538)	(4,938)
Obligations of the U.S. government and agencies
Fair Value
Securities available for sale, less than 12 months, fair value	82,187	114,120
Securities available for sale, 12 months or longer, fair value	107,601	26,726
Securities available for sale, fair value	189,788	140,846
Unrealized Losses
Securities available for sale, less than 12 months, unrealized losses	(1,634)	(1,294)
Securities available for sale, 12 months or longer, unrealized losses	(4,264)	(765)
Securities available for sale, unrealized losses	(5,898)	(2,059)
Obligations of state and political subdivisions
Fair Value
Securities available for sale, less than 12 months, fair value	11,009	11,144
Securities available for sale, 12 months or longer, fair value	2,303	2,709
Securities available for sale, fair value	13,312	13,853
Unrealized Losses
Securities available for sale, less than 12 months, unrealized losses	(21)	(29)
Securities available for sale, 12 months or longer, unrealized losses	(71)	(24)
Securities available for sale, unrealized losses	(92)	(53)
Mortgage-backed securities
Fair Value
Securities available for sale, less than 12 months, fair value	136,170	177,919
Securities available for sale, 12 months or longer, fair value	130,269	31,787
Securities available for sale, fair value	266,439	209,706
Unrealized Losses
Securities available for sale, less than 12 months, unrealized losses	(3,037)	(1,293)
Securities available for sale, 12 months or longer, unrealized losses	(4,891)	(562)
Securities available for sale, unrealized losses	(7,928)	(1,855)
Collateralized mortgage obligations
Fair Value
Securities available for sale, less than 12 months, fair value	10,939	5,166
Securities available for sale, 12 months or longer, fair value	24,945	26,686
Securities available for sale, fair value	35,884	31,852
Unrealized Losses
Securities available for sale, less than 12 months, unrealized losses	(86)	(47)
Securities available for sale, 12 months or longer, unrealized losses	(1,532)	(901)
Securities available for sale, unrealized losses	(1,618)	(948)
Other investment securities
Fair Value
Securities available for sale, less than 12 months, fair value	549	1,805
Securities available for sale, 12 months or longer, fair value	249	0
Securities available for sale, fair value	798	1,805
Unrealized Losses
Securities available for sale, less than 12 months, unrealized losses	(1)	(23)
Securities available for sale, 12 months or longer, unrealized losses	(1)	0
Securities available for sale, unrealized losses	$ (2)	$ (23)

XML

Investment Securities - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Sep. 30, 2018	Dec. 31, 2017
Investments, Debt and Equity Securities [Abstract]
Securities pledged as collateral		$ 121,100	$ 126,200
Investment securities held in trading accounts		$ 8,340	$ 4,610
Available for sale securities reclassified to trading	$ 3,200

XML

Investment Securities - Securities by Contractual Maturity (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Amortized Cost
Available for sale securities, due in one year or less, amortized cost	$ 12,265	$ 211,019
Available for sale securities, due after one year through five years, amortized cost	176,700	126,452
Available for sale securities, due after five years through ten years, amortized cost	24,459	23,147
Available for sale securities, due after ten years, amortized cost	0	15,439
Available for sale securities, subtotal, amortized cost	213,424	376,057
Amortized Cost	543,240	692,824
Fair Value
Available for sale securities, due in one year or less, fair value	12,237	211,019
Available for sale securities, due after one year through five years, fair value	171,374	124,797
Available for sale securities, due after five years through ten years, fair value	23,839	22,804
Available for sale securities, due after ten years, fair value	0	15,421
Available for sale securities, subtotal, fair value	207,450	374,041
Fair Value	528,064	689,202
Mortgage-backed securities
Amortized Cost
Available for sale securities, no stated maturity, amortized cost	329,816	313,554
Amortized Cost	292,005	275,958
Fair Value
Available for sale securities, no stated maturity, fair value	320,614	311,652
Fair Value	284,421	274,990
Mutual funds with no stated maturity
Amortized Cost
Available for sale securities, no stated maturity, amortized cost	0	3,213
Fair Value
Available for sale securities, no stated maturity, fair value	$ 0	$ 3,509

XML

Investment Securities - Amortized Cost and Fair Value of Securities Held to Maturity (Details) - Mortgage-backed securities - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Schedule of Held-to-maturity Securities [Line Items]
Held to maturity securities, amortized cost	$ 8,916	$ 7,932
Held to maturity securities, gross unrealized gains	0	5
Held to maturity securities, gross unrealized losses	(372)	(86)
Held to maturity securities, fair value	$ 8,544	$ 7,851

XML

Investment Securities - Securities Held to Maturity in an Unrealized Loss Position (Details) - Mortgage-backed securities - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Fair Value
Held to maturity securities, less than 12 months, fair value	$ 3,882	$ 2,756
Held to maturity securities, 12 months or longer, fair value	4,662	3,866
Held to maturity securities, fair value	8,544	6,622
Unrealized Losses
Held to maturity securities, less than 12 months, unrealized losses	(132)	(25)
Held to maturity securities, 12 months or longer, unrealized losses	(240)	(61)
Held to maturity securities, unrealized losses	$ (372)	$ (86)

XML

Investment Securities - Amortized Cost and Fair Value of Held to Maturity Securities (Details) - Mortgage-backed securities - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Schedule of Held-to-maturity Securities [Line Items]
Amortized Cost	$ 8,916	$ 7,932
Fair Value	$ 8,544	$ 7,851

XML

Loans and Leases - Narrative (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2018 USD ($) contract
Home equity loans and lines
Loans and Leases Receivable Disclosure [Line Items]
Home equity loan, number of contracts | contract	1
Home equity line of credit principal balance | $	$ 25
Leases
Loans and Leases Receivable Disclosure [Line Items]
Home equity loan, number of contracts | contract	1
Home equity line of credit principal balance | $	$ 50

XML

Loans and Leases - Portfolio Loans and Leases (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Loans and Leases Receivable Disclosure [Line Items]
Loans held for sale	$ 4,111	$ 3,794
Portfolio loans and leases	3,381,475	3,285,858
Total loans and leases	3,385,586	3,289,652
Loans with fixed rates	1,542,423	1,573,052
Loans with adjustable or floating rates	1,843,163	1,716,600
Total loans and leases	3,385,586	3,289,652
Net deferred loan origination fees included in the above loan table	(1,220)	(887)
Commercial mortgage
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	1,618,493	1,523,377
Home equity loans and lines
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	207,806	218,275
Residential mortgage
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	467,402	458,886
Construction
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	178,493	212,454
Real estate loans
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	2,472,194	2,412,992
Commercial and industrial
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	722,999	719,312
Consumer
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	47,809	38,153
Leases
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	138,473	115,401
Originated
Loans and Leases Receivable Disclosure [Line Items]
Loans held for sale	4,111	3,794
Portfolio loans and leases	2,752,160	2,487,296
Total loans and leases	2,756,271	2,491,090
Loans with fixed rates	1,167,097	1,034,542
Loans with adjustable or floating rates	1,589,174	1,456,548
Total loans and leases	2,756,271	2,491,090
Net deferred loan origination fees included in the above loan table	(1,220)	(887)
Originated | Commercial mortgage
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	1,259,397	1,122,327
Originated | Home equity loans and lines
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	180,068	183,283
Originated | Residential mortgage
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	381,037	360,935
Originated | Construction
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	158,691	128,266
Originated | Real estate loans
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	1,979,193	1,794,811
Originated | Commercial and industrial
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	618,200	589,304
Originated | Consumer
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	44,833	35,146
Originated | Leases
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	109,934	68,035
Acquired
Loans and Leases Receivable Disclosure [Line Items]
Loans held for sale	0	0
Portfolio loans and leases	629,315	798,562
Total loans and leases	629,315	798,562
Loans with fixed rates	375,326	538,510
Loans with adjustable or floating rates	253,989	260,052
Total loans and leases	629,315	798,562
Net deferred loan origination fees included in the above loan table	0	0
Acquired | Commercial mortgage
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	359,096	401,050
Acquired | Home equity loans and lines
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	27,738	34,992
Acquired | Residential mortgage
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	86,365	97,951
Acquired | Construction
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	19,802	84,188
Acquired | Real estate loans
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	493,001	618,181
Acquired | Commercial and industrial
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	104,799	130,008
Acquired | Consumer
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	2,976	3,007
Acquired | Leases
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	$ 28,539	$ 47,366

XML

Loans and Leases - Net Investments in Leases (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Loans and Leases Receivable Disclosure [Line Items]
Minimum lease payments receivable	$ 154,635	$ 130,811
Unearned lease income	(22,010)	(19,861)
Initial direct costs and deferred fees	5,848	4,451
Total Leases	138,473	115,401
Originated
Loans and Leases Receivable Disclosure [Line Items]
Minimum lease payments receivable	122,596	75,592
Unearned lease income	(17,717)	(10,338)
Initial direct costs and deferred fees	5,055	2,781
Total Leases	109,934	68,035
Acquired
Loans and Leases Receivable Disclosure [Line Items]
Minimum lease payments receivable	32,039	55,219
Unearned lease income	(4,293)	(9,523)
Initial direct costs and deferred fees	793	1,670
Total Leases	$ 28,539	$ 47,366

XML

Loans and Leases - Non-performing Loans and Leases (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	$ 8,990	$ 8,579
Purchased credit impaired became non-performing subsequent to acquisition	393	167
Originated
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	5,397	3,745
Acquired
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	3,593	4,834
Commercial mortgage
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	735	872
Commercial mortgage | Originated
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	0	90
Commercial mortgage | Acquired
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	735	782
Home equity loans and lines
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	1,933	1,481
Home equity loans and lines | Originated
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	1,692	1,221
Home equity loans and lines | Acquired
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	241	260
Residential mortgage
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	2,770	4,417
Residential mortgage | Originated
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	1,968	1,505
Residential mortgage | Acquired
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	802	2,912
Construction
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	291	0
Construction | Originated
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	291	0
Construction | Acquired
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	0	0
Commercial and industrial
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	1,782	1,706
Commercial and industrial | Originated
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	925	826
Commercial and industrial | Acquired
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	857	880
Consumer
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	117	0
Consumer | Originated
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	42	0
Consumer | Acquired
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	75	0
Leases
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	1,362	103
Leases | Originated
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	479	103
Leases | Acquired
Loans and Leases Receivable Disclosure [Line Items]
Non-accrual loans and leases	$ 883	$ 0

XML

Loans and Leases - Purchased Credit-Impaired Loans (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Receivables [Abstract]
Outstanding principal balance	$ 38,062	$ 46,543
Carrying amount	27,519	30,849
Purchased credit impaired loans without estimate of expected cash flows recorded investment	393	173
Purchased credit impaired became non-performing subsequent to acquisition	$ 393	$ 167

XML

Loans and Leases - Accretable Discount on Purchased Credit-impaired Loans (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2018 USD ($)
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward]
Balance	$ 4,083
Accretion	(1,819)
Reclassifications from nonaccretable difference	609
Additions/adjustments	329
Balance	$ 3,202

XML

Loans and Leases - Past Due Loans and Leases (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	$ 9,119	$ 7,959
Loans and leases, current	3,363,366	3,269,320
Loans and leases, accruing	3,372,485	3,277,279
Non-accrual loans and leases	8,990	8,579
Total portfolio loans and leases	3,381,475	3,285,858
Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	5,186	3,081
Loans and leases, current	2,741,577	2,480,470
Loans and leases, accruing	2,746,763	2,483,551
Non-accrual loans and leases	5,397	3,745
Total portfolio loans and leases	2,752,160	2,487,296
Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	3,933	4,878
Loans and leases, current	621,789	788,850
Loans and leases, accruing	625,722	793,728
Non-accrual loans and leases	3,593	4,834
Total portfolio loans and leases	629,315	798,562
Administratively Delinquent
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, current	720	4,100
Commercial mortgage
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	2,468	3,794
Loans and leases, current	1,615,290	1,518,711
Loans and leases, accruing	1,617,758	1,522,505
Non-accrual loans and leases	735	872
Total portfolio loans and leases	1,618,493	1,523,377
Commercial mortgage | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	76	1,336
Loans and leases, current	1,259,321	1,120,901
Loans and leases, accruing	1,259,397	1,122,237
Non-accrual loans and leases	0	90
Total portfolio loans and leases	1,259,397	1,122,327
Commercial mortgage | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	2,392	2,458
Loans and leases, current	355,969	397,810
Loans and leases, accruing	358,361	400,268
Non-accrual loans and leases	735	782
Total portfolio loans and leases	359,096	401,050
Home equity loans and lines
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	324	348
Loans and leases, current	205,549	216,446
Loans and leases, accruing	205,873	216,794
Non-accrual loans and leases	1,933	1,481
Total portfolio loans and leases	207,806	218,275
Home equity loans and lines | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	250	26
Loans and leases, current	178,126	182,036
Loans and leases, accruing	178,376	182,062
Non-accrual loans and leases	1,692	1,221
Total portfolio loans and leases	180,068	183,283
Home equity loans and lines | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	74	322
Loans and leases, current	27,423	34,410
Loans and leases, accruing	27,497	34,732
Non-accrual loans and leases	241	260
Total portfolio loans and leases	27,738	34,992
Residential mortgage
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	2,397	1,465
Loans and leases, current	462,235	453,004
Loans and leases, accruing	464,632	454,469
Non-accrual loans and leases	2,770	4,417
Total portfolio loans and leases	467,402	458,886
Residential mortgage | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	1,475	721
Loans and leases, current	377,594	358,709
Loans and leases, accruing	379,069	359,430
Non-accrual loans and leases	1,968	1,505
Total portfolio loans and leases	381,037	360,935
Residential mortgage | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	922	744
Loans and leases, current	84,641	94,295
Loans and leases, accruing	85,563	95,039
Non-accrual loans and leases	802	2,912
Total portfolio loans and leases	86,365	97,951
Construction
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	488	0
Loans and leases, current	177,714	212,454
Loans and leases, accruing	178,202	212,454
Non-accrual loans and leases	291	0
Total portfolio loans and leases	178,493	212,454
Construction | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	488	0
Loans and leases, current	157,912	128,266
Loans and leases, accruing	158,400	128,266
Non-accrual loans and leases	291	0
Total portfolio loans and leases	158,691	128,266
Construction | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Loans and leases, current	19,802	84,188
Loans and leases, accruing	19,802	84,188
Non-accrual loans and leases	0	0
Total portfolio loans and leases	19,802	84,188
Commercial and industrial
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	2,370	944
Loans and leases, current	718,847	716,662
Loans and leases, accruing	721,217	717,606
Non-accrual loans and leases	1,782	1,706
Total portfolio loans and leases	722,999	719,312
Commercial and industrial | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	2,306	675
Loans and leases, current	614,969	587,803
Loans and leases, accruing	617,275	588,478
Non-accrual loans and leases	925	826
Total portfolio loans and leases	618,200	589,304
Commercial and industrial | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	64	269
Loans and leases, current	103,878	128,859
Loans and leases, accruing	103,942	129,128
Non-accrual loans and leases	857	880
Total portfolio loans and leases	104,799	130,008
Consumer
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	69	1,106
Loans and leases, current	47,623	37,047
Loans and leases, accruing	47,692	38,153
Non-accrual loans and leases	117	0
Total portfolio loans and leases	47,809	38,153
Consumer | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	69	21
Loans and leases, current	44,722	35,125
Loans and leases, accruing	44,791	35,146
Non-accrual loans and leases	42	0
Total portfolio loans and leases	44,833	35,146
Consumer | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	1,085
Loans and leases, current	2,901	1,922
Loans and leases, accruing	2,901	3,007
Non-accrual loans and leases	75	0
Total portfolio loans and leases	2,976	3,007
Leases
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	1,003	302
Loans and leases, current	136,108	114,996
Loans and leases, accruing	137,111	115,298
Non-accrual loans and leases	1,362	103
Total portfolio loans and leases	138,473	115,401
Leases | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	522	302
Loans and leases, current	108,933	67,630
Loans and leases, accruing	109,455	67,932
Non-accrual loans and leases	479	103
Total portfolio loans and leases	109,934	68,035
Leases | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	481	0
Loans and leases, current	27,175	47,366
Loans and leases, accruing	27,656	47,366
Non-accrual loans and leases	883	0
Total portfolio loans and leases	28,539	47,366
30 – 59 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	4,942	4,979
30 – 59 Days Past Due | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	3,717	2,587
30 – 59 Days Past Due | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	1,225	2,392
30 – 59 Days Past Due | Commercial mortgage
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	1,366
30 – 59 Days Past Due | Commercial mortgage | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	1,255
30 – 59 Days Past Due | Commercial mortgage | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	111
30 – 59 Days Past Due | Home equity loans and lines
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	324	338
30 – 59 Days Past Due | Home equity loans and lines | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	250	26
30 – 59 Days Past Due | Home equity loans and lines | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	74	312
30 – 59 Days Past Due | Residential mortgage
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	2,218	1,386
30 – 59 Days Past Due | Residential mortgage | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	1,475	721
30 – 59 Days Past Due | Residential mortgage | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	743	665
30 – 59 Days Past Due | Construction
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	488	0
30 – 59 Days Past Due | Construction | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	488	0
30 – 59 Days Past Due | Construction | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
30 – 59 Days Past Due | Commercial and industrial
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	1,115	658
30 – 59 Days Past Due | Commercial and industrial | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	1,051	439
30 – 59 Days Past Due | Commercial and industrial | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	64	219
30 – 59 Days Past Due | Consumer
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	46	1,106
30 – 59 Days Past Due | Consumer | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	46	21
30 – 59 Days Past Due | Consumer | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	1,085
30 – 59 Days Past Due | Leases
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	751	125
30 – 59 Days Past Due | Leases | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	407	125
30 – 59 Days Past Due | Leases | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	344	0
60 – 89 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	4,177	2,980
60 – 89 Days Past Due | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	1,469	494
60 – 89 Days Past Due | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	2,708	2,486
60 – 89 Days Past Due | Commercial mortgage
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	2,468	2,428
60 – 89 Days Past Due | Commercial mortgage | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	76	81
60 – 89 Days Past Due | Commercial mortgage | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	2,392	2,347
60 – 89 Days Past Due | Home equity loans and lines
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	10
60 – 89 Days Past Due | Home equity loans and lines | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
60 – 89 Days Past Due | Home equity loans and lines | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	10
60 – 89 Days Past Due | Residential mortgage
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	179	79
60 – 89 Days Past Due | Residential mortgage | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
60 – 89 Days Past Due | Residential mortgage | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	179	79
60 – 89 Days Past Due | Construction
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
60 – 89 Days Past Due | Construction | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
60 – 89 Days Past Due | Construction | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
60 – 89 Days Past Due | Commercial and industrial
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	1,255	286
60 – 89 Days Past Due | Commercial and industrial | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	1,255	236
60 – 89 Days Past Due | Commercial and industrial | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	50
60 – 89 Days Past Due | Consumer
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	23	0
60 – 89 Days Past Due | Consumer | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	23	0
60 – 89 Days Past Due | Consumer | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
60 – 89 Days Past Due | Leases
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	252	177
60 – 89 Days Past Due | Leases | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	115	177
60 – 89 Days Past Due | Leases | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	137	0
Over 89 Days Past Due
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Commercial mortgage
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Commercial mortgage | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Commercial mortgage | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Home equity loans and lines
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Home equity loans and lines | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Home equity loans and lines | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Residential mortgage
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Residential mortgage | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Residential mortgage | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Construction
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Construction | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Construction | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Commercial and industrial
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Commercial and industrial | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Commercial and industrial | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Consumer
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Consumer | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Consumer | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Leases
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Leases | Originated
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Over 89 Days Past Due | Leases | Acquired
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, past due	0	0
Originated Loans | Administratively Delinquent
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, current	720	4,000
Acquired Loans | Administratively Delinquent
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans and leases, current	$ 0	$ 102

XML

Loans and Leases - Allowance for Loan and Leases Losses Activity (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance	$ 19,398	$ 16,399	$ 17,525	$ 17,486
Charge-offs	(1,560)	(906)	(3,991)	(2,414)
Recoveries	182	178	319	391
Provision for loan and lease losses	664	1,333	4,831	1,541
Balance	18,684	17,004	18,684	17,004
Commercial mortgage
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance	8,033	6,608	7,550	6,227
Charge-offs	(58)	0	(74)	0
Recoveries	2	3	8	9
Provision for loan and lease losses	(433)	721	60	1,096
Balance	7,544	7,332	7,544	7,332
Home equity loans and lines
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance	933	1,214	1,086	1,255
Charge-offs	0	(69)	(225)	(676)
Recoveries	0	0	1	0
Provision for loan and lease losses	(41)	(53)	30	513
Balance	892	1,092	892	1,092
Residential mortgage
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance	1,933	1,776	1,926	1,917
Charge-offs	(42)	(88)	(42)	(158)
Recoveries	54	85	55	85
Provision for loan and lease losses	(127)	48	(121)	(23)
Balance	1,818	1,821	1,818	1,821
Construction
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance	1,158	1,111	937	2,233
Charge-offs	0	0	0	0
Recoveries	0	1	1	3
Provision for loan and lease losses	83	(182)	303	(1,306)
Balance	1,241	930	1,241	930
Commercial and industrial
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance	5,672	4,813	5,038	5,142
Charge-offs	(319)	(301)	(1,069)	(560)
Recoveries	16	2	17	18
Provision for loan and lease losses	(64)	366	1,319	280
Balance	5,305	4,880	5,305	4,880
Consumer
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance	289	177	246	153
Charge-offs	(73)	(37)	(165)	(96)
Recoveries	2	1	5	5
Provision for loan and lease losses	100	69	232	148
Balance	318	210	318	210
Leases
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance	1,380	700	742	559
Charge-offs	(1,068)	(411)	(2,416)	(924)
Recoveries	108	86	232	271
Provision for loan and lease losses	1,146	364	3,008	833
Balance	1,566	739	1,566	739
Unallocated
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance	0	0	0	0
Charge-offs	0	0	0	0
Recoveries	0	0	0	0
Provision for loan and lease losses	0	0	0	0
Balance	$ 0	$ 0	$ 0	$ 0

XML

Loans and Leases - Allowance for Loan and Lease Losses by Method of Impairment (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Jun. 30, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Dec. 31, 2016
Allowance on loans and leases:
Individually evaluated for impairment	$ 278		$ 258
Collectively evaluated for impairment	18,406		17,267
Allowance on loans and leases	18,684	$ 19,398	17,525	$ 17,004	$ 16,399	$ 17,486
Carrying value of loans and leases:
Individually evaluated for impairment	11,470		13,940
Collectively evaluated for impairment	3,342,486		3,241,069
Portfolio loans and leases	3,381,475		3,285,858
Purchased credit-impaired
Allowance on loans and leases:
Allowance on loans and leases	0		0
Carrying value of loans and leases:
Portfolio loans and leases	27,519		30,849
Originated
Allowance on loans and leases:
Individually evaluated for impairment	206		208
Collectively evaluated for impairment	18,406		17,267
Allowance on loans and leases	18,612		17,475
Carrying value of loans and leases:
Individually evaluated for impairment	8,282		8,878
Collectively evaluated for impairment	2,743,878		2,478,418
Portfolio loans and leases	2,752,160		2,487,296
Acquired
Carrying value of loans and leases:
Individually evaluated for impairment	3,188		5,062
Collectively evaluated for impairment	598,608		762,651
Portfolio loans and leases	629,315		798,562
Financial Asset Acquired With and Without Credit Deterioration
Allowance on loans and leases:
Individually evaluated for impairment	72		50
Collectively evaluated for impairment	0		0
Allowance on loans and leases	72		50
Commercial mortgage
Allowance on loans and leases:
Individually evaluated for impairment	0		0
Collectively evaluated for impairment	7,544		7,550
Allowance on loans and leases	7,544	8,033	7,550	7,332	6,608	6,227
Carrying value of loans and leases:
Individually evaluated for impairment	736		2,128
Collectively evaluated for impairment	1,609,375		1,503,825
Portfolio loans and leases	1,618,493		1,523,377
Commercial mortgage | Purchased credit-impaired
Allowance on loans and leases:
Allowance on loans and leases	0		0
Carrying value of loans and leases:
Portfolio loans and leases	8,382		17,424
Commercial mortgage | Originated
Allowance on loans and leases:
Individually evaluated for impairment	0		0
Collectively evaluated for impairment	7,544		7,550
Allowance on loans and leases	7,544		7,550
Carrying value of loans and leases:
Individually evaluated for impairment	0		1,345
Collectively evaluated for impairment	1,259,397		1,120,982
Portfolio loans and leases	1,259,397		1,122,327
Commercial mortgage | Acquired
Carrying value of loans and leases:
Individually evaluated for impairment	736		783
Collectively evaluated for impairment	349,978		382,843
Portfolio loans and leases	359,096		401,050
Commercial mortgage | Financial Asset Acquired With and Without Credit Deterioration
Allowance on loans and leases:
Individually evaluated for impairment	0		0
Collectively evaluated for impairment	0		0
Allowance on loans and leases	0		0
Home equity loans and lines
Allowance on loans and leases:
Individually evaluated for impairment	19		19
Collectively evaluated for impairment	873		1,067
Allowance on loans and leases	892	933	1,086	1,092	1,214	1,255
Carrying value of loans and leases:
Individually evaluated for impairment	2,602		2,162
Collectively evaluated for impairment	204,694		215,604
Portfolio loans and leases	207,806		218,275
Home equity loans and lines | Purchased credit-impaired
Allowance on loans and leases:
Allowance on loans and leases	0		0
Carrying value of loans and leases:
Portfolio loans and leases	510		509
Home equity loans and lines | Originated
Allowance on loans and leases:
Individually evaluated for impairment	19		19
Collectively evaluated for impairment	873		1,067
Allowance on loans and leases	892		1,086
Carrying value of loans and leases:
Individually evaluated for impairment	2,361		1,902
Collectively evaluated for impairment	177,707		181,381
Portfolio loans and leases	180,068		183,283
Home equity loans and lines | Acquired
Carrying value of loans and leases:
Individually evaluated for impairment	241		260
Collectively evaluated for impairment	26,987		34,223
Portfolio loans and leases	27,738		34,992
Home equity loans and lines | Financial Asset Acquired With and Without Credit Deterioration
Allowance on loans and leases:
Individually evaluated for impairment	0		0
Collectively evaluated for impairment	0		0
Allowance on loans and leases	0		0
Residential mortgage
Allowance on loans and leases:
Individually evaluated for impairment	228		230
Collectively evaluated for impairment	1,590		1,696
Allowance on loans and leases	1,818	1,933	1,926	1,821	1,776	1,917
Carrying value of loans and leases:
Individually evaluated for impairment	5,940		7,726
Collectively evaluated for impairment	461,462		451,160
Portfolio loans and leases	467,402		458,886
Residential mortgage | Purchased credit-impaired
Allowance on loans and leases:
Allowance on loans and leases	0		0
Carrying value of loans and leases:
Portfolio loans and leases	0		0
Residential mortgage | Originated
Allowance on loans and leases:
Individually evaluated for impairment	179		180
Collectively evaluated for impairment	1,590		1,696
Allowance on loans and leases	1,769		1,876
Carrying value of loans and leases:
Individually evaluated for impairment	4,268		4,418
Collectively evaluated for impairment	376,769		356,517
Portfolio loans and leases	381,037		360,935
Residential mortgage | Acquired
Carrying value of loans and leases:
Individually evaluated for impairment	1,672		3,308
Collectively evaluated for impairment	84,693		94,643
Portfolio loans and leases	86,365		97,951
Residential mortgage | Financial Asset Acquired With and Without Credit Deterioration
Allowance on loans and leases:
Individually evaluated for impairment	49		50
Collectively evaluated for impairment	0		0
Allowance on loans and leases	49		50
Construction
Allowance on loans and leases:
Individually evaluated for impairment	0		0
Collectively evaluated for impairment	1,241		937
Allowance on loans and leases	1,241	1,158	937	930	1,111	2,233
Carrying value of loans and leases:
Individually evaluated for impairment	291		0
Collectively evaluated for impairment	175,802		204,088
Portfolio loans and leases	178,493		212,454
Construction | Purchased credit-impaired
Allowance on loans and leases:
Allowance on loans and leases	0		0
Carrying value of loans and leases:
Portfolio loans and leases	2,400		8,366
Construction | Originated
Allowance on loans and leases:
Individually evaluated for impairment	0		0
Collectively evaluated for impairment	1,241		937
Allowance on loans and leases	1,241		937
Carrying value of loans and leases:
Individually evaluated for impairment	291		0
Collectively evaluated for impairment	158,400		128,266
Portfolio loans and leases	158,691		128,266
Construction | Acquired
Carrying value of loans and leases:
Individually evaluated for impairment	0		0
Collectively evaluated for impairment	17,402		75,822
Portfolio loans and leases	19,802		84,188
Construction | Financial Asset Acquired With and Without Credit Deterioration
Allowance on loans and leases:
Individually evaluated for impairment	0		0
Collectively evaluated for impairment	0		0
Allowance on loans and leases	0		0
Commercial and industrial
Allowance on loans and leases:
Individually evaluated for impairment	11		5
Collectively evaluated for impairment	5,294		5,033
Allowance on loans and leases	5,305	5,672	5,038	4,880	4,813	5,142
Carrying value of loans and leases:
Individually evaluated for impairment	1,757		1,897
Collectively evaluated for impairment	705,015		712,865
Portfolio loans and leases	722,999		719,312
Commercial and industrial | Purchased credit-impaired
Allowance on loans and leases:
Allowance on loans and leases	0		0
Carrying value of loans and leases:
Portfolio loans and leases	16,227		4,550
Commercial and industrial | Originated
Allowance on loans and leases:
Individually evaluated for impairment	4		5
Collectively evaluated for impairment	5,294		5,033
Allowance on loans and leases	5,298		5,038
Carrying value of loans and leases:
Individually evaluated for impairment	1,294		1,186
Collectively evaluated for impairment	616,906		588,118
Portfolio loans and leases	618,200		589,304
Commercial and industrial | Acquired
Carrying value of loans and leases:
Individually evaluated for impairment	463		711
Collectively evaluated for impairment	88,109		124,747
Portfolio loans and leases	104,799		130,008
Commercial and industrial | Financial Asset Acquired With and Without Credit Deterioration
Allowance on loans and leases:
Individually evaluated for impairment	7		0
Collectively evaluated for impairment	0		0
Allowance on loans and leases	7		0
Consumer
Allowance on loans and leases:
Individually evaluated for impairment	20		4
Collectively evaluated for impairment	298		242
Allowance on loans and leases	318	289	246	210	177	153
Carrying value of loans and leases:
Individually evaluated for impairment	144		27
Collectively evaluated for impairment	47,665		38,126
Portfolio loans and leases	47,809		38,153
Consumer | Purchased credit-impaired
Allowance on loans and leases:
Allowance on loans and leases	0		0
Carrying value of loans and leases:
Portfolio loans and leases	0		0
Consumer | Originated
Allowance on loans and leases:
Individually evaluated for impairment	4		4
Collectively evaluated for impairment	298		242
Allowance on loans and leases	302		246
Carrying value of loans and leases:
Individually evaluated for impairment	68		27
Collectively evaluated for impairment	44,765		35,119
Portfolio loans and leases	44,833		35,146
Consumer | Acquired
Carrying value of loans and leases:
Individually evaluated for impairment	76		0
Collectively evaluated for impairment	2,900		3,007
Portfolio loans and leases	2,976		3,007
Consumer | Financial Asset Acquired With and Without Credit Deterioration
Allowance on loans and leases:
Individually evaluated for impairment	16		0
Collectively evaluated for impairment	0		0
Allowance on loans and leases	16		0
Leases
Allowance on loans and leases:
Individually evaluated for impairment	0		0
Collectively evaluated for impairment	1,566		742
Allowance on loans and leases	1,566	1,380	742	739	700	559
Carrying value of loans and leases:
Individually evaluated for impairment	0		0
Collectively evaluated for impairment	138,473		115,401
Portfolio loans and leases	138,473		115,401
Leases | Purchased credit-impaired
Allowance on loans and leases:
Allowance on loans and leases	0		0
Carrying value of loans and leases:
Portfolio loans and leases	0		0
Leases | Originated
Allowance on loans and leases:
Individually evaluated for impairment	0		0
Collectively evaluated for impairment	1,566		742
Allowance on loans and leases	1,566		742
Carrying value of loans and leases:
Individually evaluated for impairment	0		0
Collectively evaluated for impairment	109,934		68,035
Portfolio loans and leases	109,934		68,035
Leases | Acquired
Carrying value of loans and leases:
Individually evaluated for impairment	0		0
Collectively evaluated for impairment	28,539		47,366
Portfolio loans and leases	28,539		47,366
Leases | Financial Asset Acquired With and Without Credit Deterioration
Allowance on loans and leases:
Individually evaluated for impairment	0		0
Collectively evaluated for impairment	0		0
Allowance on loans and leases	0		0
Unallocated
Allowance on loans and leases:
Individually evaluated for impairment	0		0
Collectively evaluated for impairment	0		0
Allowance on loans and leases	0	$ 0	0	$ 0	$ 0	$ 0
Unallocated | Purchased credit-impaired
Allowance on loans and leases:
Allowance on loans and leases	$ 0		$ 0

XML

Loans and Leases - Credit Risk Profile by Internally Assigned Grade (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	$ 3,381,475	$ 3,285,858
Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	2,752,160	2,487,296
Pass
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	2,458,984	2,395,234
Pass | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	2,016,075	1,827,327
Pass | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	442,909	567,907
Special Mention
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	5,680	18,239
Special Mention | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	2,198	664
Special Mention | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	3,482	17,575
Substandard
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	54,769	39,532
Substandard | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	18,014	11,551
Substandard | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	36,755	27,981
Doubtful
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	552	2,138
Doubtful | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	1	355
Doubtful | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	551	1,783
Pass, Special Mention and Substandard
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	2,519,985	2,455,143
Pass, Special Mention and Substandard | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	2,036,288	1,839,897
Pass, Special Mention and Substandard | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	483,697	615,246
Commercial mortgage
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	1,618,493	1,523,377
Commercial mortgage | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	1,259,397	1,122,327
Commercial mortgage | Pass
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	1,592,174	1,490,862
Commercial mortgage | Pass | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	1,252,916	1,114,171
Commercial mortgage | Pass | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	339,258	376,691
Commercial mortgage | Special Mention
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	2,321	13,448
Commercial mortgage | Special Mention | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	0	0
Commercial mortgage | Special Mention | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	2,321	13,448
Commercial mortgage | Substandard
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	23,447	18,194
Commercial mortgage | Substandard | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	6,481	8,156
Commercial mortgage | Substandard | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	16,966	10,038
Commercial mortgage | Doubtful
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	551	873
Commercial mortgage | Doubtful | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	0	0
Commercial mortgage | Doubtful | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	551	873
Commercial mortgage | Pass, Special Mention and Substandard
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	1,618,493	1,523,377
Commercial mortgage | Pass, Special Mention and Substandard | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	1,259,397	1,122,327
Commercial mortgage | Pass, Special Mention and Substandard | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	359,096	401,050
Construction
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	178,493	212,454
Construction | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	158,691	128,266
Construction | Pass
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	168,897	193,227
Construction | Pass | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	152,429	126,260
Construction | Pass | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	16,468	66,967
Construction | Special Mention
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	934	3,902
Construction | Special Mention | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	0	0
Construction | Special Mention | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	934	3,902
Construction | Substandard
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	8,662	15,325
Construction | Substandard | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	6,262	2,006
Construction | Substandard | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	2,400	13,319
Construction | Doubtful
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	0	0
Construction | Doubtful | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	0	0
Construction | Doubtful | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	0	0
Construction | Pass, Special Mention and Substandard
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	178,493	212,454
Construction | Pass, Special Mention and Substandard | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	158,691	128,266
Construction | Pass, Special Mention and Substandard | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	19,802	84,188
Real estate loans
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	2,472,194	2,412,992
Real estate loans | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	1,979,193	1,794,811
Commercial and industrial
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	722,999	719,312
Commercial and industrial | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	618,200	589,304
Commercial and industrial | Pass
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	697,913	711,145
Commercial and industrial | Pass | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	610,730	586,896
Commercial and industrial | Pass | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	87,183	124,249
Commercial and industrial | Special Mention
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	2,425	889
Commercial and industrial | Special Mention | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	2,198	664
Commercial and industrial | Special Mention | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	227	225
Commercial and industrial | Substandard
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	22,660	6,013
Commercial and industrial | Substandard | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	5,271	1,389
Commercial and industrial | Substandard | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	17,389	4,624
Commercial and industrial | Doubtful
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	1	1,265
Commercial and industrial | Doubtful | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	1	355
Commercial and industrial | Doubtful | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	0	910
Commercial and industrial | Pass, Special Mention and Substandard
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	722,999	719,312
Commercial and industrial | Pass, Special Mention and Substandard | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	618,200	589,304
Commercial and industrial | Pass, Special Mention and Substandard | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	$ 104,799	$ 130,008

XML

Loans and Leases - Credit Risk Profile by Payment Activity (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	$ 3,381,475	$ 3,285,858
Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	2,752,160	2,487,296
Residential mortgage
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	467,402	458,886
Residential mortgage | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	381,037	360,935
Home equity loans and lines
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	207,806	218,275
Home equity loans and lines | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	180,068	183,283
Consumer
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	47,809	38,153
Consumer | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	44,833	35,146
Leases
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	138,473	115,401
Leases | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	109,934	68,035
Performing Financial Instruments
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	855,308	824,714
Performing Financial Instruments | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	711,691	644,570
Performing Financial Instruments | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	143,617	180,144
Performing Financial Instruments | Residential mortgage
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	464,632	454,469
Performing Financial Instruments | Residential mortgage | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	379,069	359,430
Performing Financial Instruments | Residential mortgage | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	85,563	95,039
Performing Financial Instruments | Home equity loans and lines
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	205,873	216,794
Performing Financial Instruments | Home equity loans and lines | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	178,376	182,062
Performing Financial Instruments | Home equity loans and lines | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	27,497	34,732
Performing Financial Instruments | Consumer
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	47,692	38,153
Performing Financial Instruments | Consumer | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	44,791	35,146
Performing Financial Instruments | Consumer | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	2,901	3,007
Performing Financial Instruments | Leases
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	137,111	115,298
Performing Financial Instruments | Leases | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	109,455	67,932
Performing Financial Instruments | Leases | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	27,656	47,366
Nonperforming Financial Instruments
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	6,182	6,001
Nonperforming Financial Instruments | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	4,181	2,829
Nonperforming Financial Instruments | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	2,001	3,172
Nonperforming Financial Instruments | Residential mortgage
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	2,770	4,417
Nonperforming Financial Instruments | Residential mortgage | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	1,968	1,505
Nonperforming Financial Instruments | Residential mortgage | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	802	2,912
Nonperforming Financial Instruments | Home equity loans and lines
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	1,933	1,481
Nonperforming Financial Instruments | Home equity loans and lines | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	1,692	1,221
Nonperforming Financial Instruments | Home equity loans and lines | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	241	260
Nonperforming Financial Instruments | Consumer
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	117	0
Nonperforming Financial Instruments | Consumer | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	42	0
Nonperforming Financial Instruments | Consumer | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	75	0
Nonperforming Financial Instruments | Leases
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	1,362	103
Nonperforming Financial Instruments | Leases | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	479	103
Nonperforming Financial Instruments | Leases | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	883	0
Performing and Non-performing
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	861,490	830,715
Performing and Non-performing | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	715,872	647,399
Performing and Non-performing | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	145,618	183,316
Performing and Non-performing | Residential mortgage
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	467,402	458,886
Performing and Non-performing | Residential mortgage | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	381,037	360,935
Performing and Non-performing | Residential mortgage | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	86,365	97,951
Performing and Non-performing | Home equity loans and lines
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	207,806	218,275
Performing and Non-performing | Home equity loans and lines | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	180,068	183,283
Performing and Non-performing | Home equity loans and lines | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	27,738	34,992
Performing and Non-performing | Consumer
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	47,809	38,153
Performing and Non-performing | Consumer | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	44,833	35,146
Performing and Non-performing | Consumer | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	2,976	3,007
Performing and Non-performing | Leases
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	138,473	115,401
Performing and Non-performing | Leases | Originated
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	109,934	68,035
Performing and Non-performing | Leases | Financial Asset Acquired With and Without Credit Deterioration
Loans and Leases Receivable Disclosure [Line Items]
Portfolio loans and leases	$ 28,539	$ 47,366

XML

Loans and Leases - Troubled Debt Restructurings (Details) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2018 USD ($) contract	Sep. 30, 2018 USD ($) contract	Dec. 31, 2017 USD ($)
Financing Receivable, Modifications [Line Items]
Troubled debt restructurings | $	$ 5,524	$ 5,524	$ 9,089
Number of contracts	4	10
Pre-Modification Outstanding Recorded Investment | $	$ 406	$ 684
Post-Modification Outstanding Recorded Investment | $	$ 430	$ 708
Loan Term Extension
Financing Receivable, Modifications [Line Items]
Number of contracts	1	2
Interest Rate Change and Term Extension
Financing Receivable, Modifications [Line Items]
Number of contracts	0	3
Interest Rate Change and/or Interest-Only Period
Financing Receivable, Modifications [Line Items]
Number of contracts	0	0
Contractual Payment Reduction (Leases only)
Financing Receivable, Modifications [Line Items]
Number of contracts	0	2
Temporary Payment Deferral
Financing Receivable, Modifications [Line Items]
Number of contracts	3	3
Home equity loans and lines
Financing Receivable, Modifications [Line Items]
Number of contracts	0	1
Pre-Modification Outstanding Recorded Investment | $	$ 0	$ 8
Post-Modification Outstanding Recorded Investment | $	$ 0	$ 8
Home equity loans and lines | Loan Term Extension
Financing Receivable, Modifications [Line Items]
Number of contracts	0	0
Home equity loans and lines | Interest Rate Change and Term Extension
Financing Receivable, Modifications [Line Items]
Number of contracts	0	1
Home equity loans and lines | Interest Rate Change and/or Interest-Only Period
Financing Receivable, Modifications [Line Items]
Number of contracts	0	0
Home equity loans and lines | Contractual Payment Reduction (Leases only)
Financing Receivable, Modifications [Line Items]
Number of contracts	0	0
Home equity loans and lines | Temporary Payment Deferral
Financing Receivable, Modifications [Line Items]
Number of contracts	0	0
Residential mortgage
Financing Receivable, Modifications [Line Items]
Number of contracts	4	6
Pre-Modification Outstanding Recorded Investment | $	$ 406	$ 625
Post-Modification Outstanding Recorded Investment | $	$ 430	$ 649
Residential mortgage | Loan Term Extension
Financing Receivable, Modifications [Line Items]
Number of contracts	1	2
Residential mortgage | Interest Rate Change and Term Extension
Financing Receivable, Modifications [Line Items]
Number of contracts	0	1
Residential mortgage | Interest Rate Change and/or Interest-Only Period
Financing Receivable, Modifications [Line Items]
Number of contracts	0	0
Residential mortgage | Contractual Payment Reduction (Leases only)
Financing Receivable, Modifications [Line Items]
Number of contracts	0	0
Residential mortgage | Temporary Payment Deferral
Financing Receivable, Modifications [Line Items]
Number of contracts	3	3
Leases
Financing Receivable, Modifications [Line Items]
Number of contracts	0	2
Pre-Modification Outstanding Recorded Investment | $	$ 0	$ 33
Post-Modification Outstanding Recorded Investment | $	$ 0	$ 33
Leases | Loan Term Extension
Financing Receivable, Modifications [Line Items]
Number of contracts	0	0
Leases | Interest Rate Change and Term Extension
Financing Receivable, Modifications [Line Items]
Number of contracts	0	0
Leases | Interest Rate Change and/or Interest-Only Period
Financing Receivable, Modifications [Line Items]
Number of contracts	0	0
Leases | Contractual Payment Reduction (Leases only)
Financing Receivable, Modifications [Line Items]
Number of contracts	0	2
Leases | Temporary Payment Deferral
Financing Receivable, Modifications [Line Items]
Number of contracts	0	0
Commercial and industrial
Financing Receivable, Modifications [Line Items]
Number of contracts		1
Pre-Modification Outstanding Recorded Investment | $		$ 18
Post-Modification Outstanding Recorded Investment | $		$ 18
Commercial and industrial | Loan Term Extension
Financing Receivable, Modifications [Line Items]
Number of contracts		0
Commercial and industrial | Interest Rate Change and Term Extension
Financing Receivable, Modifications [Line Items]
Number of contracts		1
Commercial and industrial | Interest Rate Change and/or Interest-Only Period
Financing Receivable, Modifications [Line Items]
Number of contracts		0
Commercial and industrial | Contractual Payment Reduction (Leases only)
Financing Receivable, Modifications [Line Items]
Number of contracts		0
Commercial and industrial | Temporary Payment Deferral
Financing Receivable, Modifications [Line Items]
Number of contracts		0
Nonperforming Financial Instruments
Financing Receivable, Modifications [Line Items]
Troubled debt restructurings | $	$ 1,208	$ 1,208	3,289
Performing Financial Instruments
Financing Receivable, Modifications [Line Items]
Troubled debt restructurings | $	$ 4,316	$ 4,316	$ 5,800

XML

Loans and Leases - Impaired Loans (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Financing Receivable, Impaired [Line Items]
Impaired loans with related allowance, recorded investment	$ 2,349	$ 1,818	$ 2,349	$ 1,818	$ 3,058
Impaired loans with related allowance, principal balance	2,349	1,818	2,349	1,818	3,058
Impaired loans, related allowance	278	123	278	123	258
Impaired loans with related allowance, average principal balance	2,354	1,825	2,368	1,846
Impaired loans with related allowance, interest income recognized	26	23	79	69
Impaired loans without related allowance, recorded investment	9,122	8,710	9,122	8,710	10,882
Impaired loans without related allowance, principal balance	10,259	9,990	10,259	9,990	13,005
Impaired loans without related allowance, average principal balance	9,812	8,954	9,702	9,178
Impaired loans without related allowance, interest income recognized	31	61	171	202
Impaired loans, recorded investment	11,471	10,528	11,471	10,528	13,940
Impaired loans, principal balance	12,608	11,808	12,608	11,808	16,063
Impaired loans, related allowance	278	123	278	123	258
Impaired loans, average principal balance	12,166	10,779	12,070	11,024
Impaired loans, interest income recognized	57	84	250	271
Home equity loans and lines
Financing Receivable, Impaired [Line Items]
Impaired loans with related allowance, recorded investment	567	21	567	21	577
Impaired loans with related allowance, principal balance	567	21	567	21	577
Impaired loans, related allowance	19	3	19	3	19
Impaired loans with related allowance, average principal balance	569	21	572	21
Impaired loans with related allowance, interest income recognized	6	0	17	1
Impaired loans without related allowance, recorded investment	2,035	633	2,035	633	1,585
Impaired loans without related allowance, principal balance	2,096	694	2,096	694	1,645
Impaired loans without related allowance, average principal balance	2,064	655	2,086	669
Impaired loans without related allowance, interest income recognized	2	1	10	5
Impaired loans, related allowance	19	3	19	3	19
Commercial mortgage
Financing Receivable, Impaired [Line Items]
Impaired loans without related allowance, recorded investment	735	1,449	735	1,449	2,128
Impaired loans without related allowance, principal balance	793	1,485	793	1,485	2,218
Impaired loans without related allowance, average principal balance	930	1,451	825	1,475
Impaired loans without related allowance, interest income recognized	0	15	6	45
Residential mortgage
Financing Receivable, Impaired [Line Items]
Impaired loans with related allowance, recorded investment	1,699	1,770	1,699	1,770	2,436
Impaired loans with related allowance, principal balance	1,699	1,770	1,699	1,770	2,435
Impaired loans, related allowance	228	116	228	116	230
Impaired loans with related allowance, average principal balance	1,702	1,776	1,709	1,797
Impaired loans with related allowance, interest income recognized	20	23	60	67
Impaired loans without related allowance, recorded investment	4,242	4,688	4,242	4,688	5,290
Impaired loans without related allowance, principal balance	4,328	5,015	4,328	5,015	5,529
Impaired loans without related allowance, average principal balance	4,299	4,243	4,228	4,288
Impaired loans without related allowance, interest income recognized	24	43	91	118
Impaired loans, related allowance	228	116	228	116	230
Construction
Financing Receivable, Impaired [Line Items]
Impaired loans without related allowance, recorded investment	291		291
Impaired loans without related allowance, principal balance	291		291
Impaired loans without related allowance, average principal balance	294		239
Impaired loans without related allowance, interest income recognized	0		5
Commercial and industrial
Financing Receivable, Impaired [Line Items]
Impaired loans with related allowance, recorded investment	25		25		18
Impaired loans with related allowance, principal balance	25		25		19
Impaired loans, related allowance	12		12		5
Impaired loans with related allowance, average principal balance	25		29
Impaired loans with related allowance, interest income recognized	0		1
Impaired loans without related allowance, recorded investment	1,733	1,940	1,733	1,940	1,879
Impaired loans without related allowance, principal balance	2,665	2,796	2,665	2,796	3,613
Impaired loans without related allowance, average principal balance	2,138	2,605	2,236	2,746
Impaired loans without related allowance, interest income recognized	5	2	56	34
Impaired loans, related allowance	12		12		5
Consumer
Financing Receivable, Impaired [Line Items]
Impaired loans with related allowance, recorded investment	58	27	58	27	27
Impaired loans with related allowance, principal balance	58	27	58	27	27
Impaired loans, related allowance	19	4	19	4	4
Impaired loans with related allowance, average principal balance	58	28	58	28
Impaired loans with related allowance, interest income recognized	0	0	1	1
Impaired loans without related allowance, recorded investment	86		86
Impaired loans without related allowance, principal balance	86		86
Impaired loans without related allowance, average principal balance	87		88
Impaired loans without related allowance, interest income recognized	0		3
Impaired loans, related allowance	19	4	19	4	4
Impaired Loans Without Related Allowance | Leases
Financing Receivable, Impaired [Line Items]
Impaired loans, recorded investment	$ 1,400	$ 270	$ 1,400	$ 270	$ 272

XML

Loans and Leases - Loan Acquired (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Loans and Leases Receivable Disclosure [Line Items]
Acquired loans, outstanding principal	$ 654,264	$ 833,352
Acquired loans, remaining loan mark	(24,949)	(34,790)
Acquired loans, recorded investment	629,315	798,562
Commercial mortgage
Loans and Leases Receivable Disclosure [Line Items]
Acquired loans, outstanding principal	369,894	412,263
Acquired loans, remaining loan mark	(10,798)	(11,213)
Acquired loans, recorded investment	359,096	401,050
Home equity loans and lines
Loans and Leases Receivable Disclosure [Line Items]
Acquired loans, outstanding principal	30,240	37,944
Acquired loans, remaining loan mark	(2,502)	(2,952)
Acquired loans, recorded investment	27,738	34,992
Residential mortgage
Loans and Leases Receivable Disclosure [Line Items]
Acquired loans, outstanding principal	89,302	101,523
Acquired loans, remaining loan mark	(2,937)	(3,572)
Acquired loans, recorded investment	86,365	97,951
Construction
Loans and Leases Receivable Disclosure [Line Items]
Acquired loans, outstanding principal	20,142	86,081
Acquired loans, remaining loan mark	(340)	(1,893)
Acquired loans, recorded investment	19,802	84,188
Commercial and industrial
Loans and Leases Receivable Disclosure [Line Items]
Acquired loans, outstanding principal	111,799	141,960
Acquired loans, remaining loan mark	(7,000)	(11,952)
Acquired loans, recorded investment	104,799	130,008
Consumer
Loans and Leases Receivable Disclosure [Line Items]
Acquired loans, outstanding principal	3,094	3,051
Acquired loans, remaining loan mark	(118)	(44)
Acquired loans, recorded investment	2,976	3,007
Leases
Loans and Leases Receivable Disclosure [Line Items]
Acquired loans, outstanding principal	29,793	50,530
Acquired loans, remaining loan mark	(1,254)	(3,164)
Acquired loans, recorded investment	$ 28,539	$ 47,366

XML

Mortgage Servicing Rights - Mortgage Servicing Rights Activity (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Servicing Asset at Fair Value, Amount [Roll Forward]
Balance, beginning of period			$ 5,861
Balance, end of period	$ 5,328		5,328
Fair value	6,600		6,600		$ 6,400
Residential mortgages
Servicing Asset at Fair Value, Amount [Roll Forward]
Balance, beginning of period	5,511	$ 5,682	5,861	$ 5,582
Additions	0	282	16	770
Amortization	(206)	(229)	(623)	(571)
Recovery / (Impairment)	23	(3)	74	(49)
Balance, end of period	5,328	5,732	5,328	5,732
Fair value	6,586	6,146	6,586	6,146	$ 6,397
Residential mortgage loans serviced for others	$ 596,162	$ 647,997	$ 596,162	$ 647,997

XML

Mortgage Servicing Rights - Narrative (Details) - USD ($) $ in Millions	Sep. 30, 2018	Dec. 31, 2017
Transfers and Servicing [Abstract]
Sensitivity percent, adverse change in assumption, low	10.00%
Sensitivity percent, adverse change in assumption, high	20.00%
Fair value	$ 6.6	$ 6.4

XML

Mortgage Servicing Rights - Key Economic Assumptions and Sensitivity of Current Fair Value of MSRs (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2018	Dec. 31, 2017	Sep. 30, 2017
Servicing Assets at Fair Value [Line Items]
Fair value	$ 6,600	$ 6,400
Residential mortgages
Servicing Assets at Fair Value [Line Items]
Fair value	$ 6,586	$ 6,397	$ 6,146
Weighted average life (in years)	6 years 7 months 6 days	6 years 36 days
Prepayment speeds (constant prepayment rate)	8.70%	10.30%
10% adverse change	$ (85)	$ (194)
20% adverse change	$ (190)	$ (394)
Discount rate (as a percent)	9.55%	9.55%
10% adverse change	$ (245)	$ (225)
20% adverse change	$ (472)	$ (434)

XML

Goodwill and Intangibles Assets - Goodwill and Intangible Assets Rollforward (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Goodwill [Roll Forward]
Balance December 31, 2017			$ 179,889
Additions			677
Adjustments			3,298
Balance September 30, 2018	$ 183,864		183,864
Finite-lived Intangible Assets [Roll Forward]
Additions			994
Intangible assets amortization	(891)	$ (677)	(2,659)	$ (2,057)
Indefinite-lived Intangible Assets [Roll Forward]
Total Intangible Assets			25,966
Additions			994
Intangible assets amortization	(891)	$ (677)	(2,659)	$ (2,057)
Total Intangible Assets	24,301		24,301
Total Goodwill and Intangible Assets, beginning balance			205,855
Intangible Assets (Including Goodwill) Acquired			1,671
Grand Total adjustments			3,298
Intangible assets amortization			(2,659)
Total Goodwill and Intangible Assets, ending balance	208,165		208,165
Domain Name
Indefinite-lived Intangible Assets [Roll Forward]
Indefinite-lived intangible assets			151
Indefinite-lived intangible assets acquired			0
Indefinite-lived intangible assets	151		151
Core deposit intangible
Finite-lived Intangible Assets [Roll Forward]
Balance December 31, 2017			7,380
Additions			0
Intangible assets amortization			(1,108)
Balance September 30, 2018	6,272		$ 6,272
Intangible asset amortization period (Year)			10 years
Indefinite-lived Intangible Assets [Roll Forward]
Additions			$ 0
Intangible assets amortization			(1,108)
Customer relationships
Finite-lived Intangible Assets [Roll Forward]
Balance December 31, 2017			14,173
Additions			994
Intangible assets amortization			(1,271)
Balance September 30, 2018	$ 13,896		13,896
Indefinite-lived Intangible Assets [Roll Forward]
Additions			994
Intangible assets amortization			(1,271)
Customer relationships | Minimum
Finite-lived Intangible Assets [Roll Forward]
Intangible asset amortization period (Year)	10 years
Customer relationships | Maximum
Finite-lived Intangible Assets [Roll Forward]
Intangible asset amortization period (Year)	20 years
Non-compete agreements
Finite-lived Intangible Assets [Roll Forward]
Balance December 31, 2017			1,319
Additions			0
Intangible assets amortization			(171)
Balance September 30, 2018	$ 1,148		1,148
Indefinite-lived Intangible Assets [Roll Forward]
Additions			0
Intangible assets amortization			(171)
Non-compete agreements | Minimum
Finite-lived Intangible Assets [Roll Forward]
Intangible asset amortization period (Year)	5 years
Non-compete agreements | Maximum
Finite-lived Intangible Assets [Roll Forward]
Intangible asset amortization period (Year)	10 years
Trade name
Finite-lived Intangible Assets [Roll Forward]
Balance December 31, 2017			2,322
Additions			0
Intangible assets amortization			(49)
Balance September 30, 2018	$ 2,273		2,273
Indefinite-lived Intangible Assets [Roll Forward]
Additions			0
Intangible assets amortization			(49)
Trade name | Minimum
Finite-lived Intangible Assets [Roll Forward]
Intangible asset amortization period (Year)	3 years
Favorable lease assets
Finite-lived Intangible Assets [Roll Forward]
Balance December 31, 2017			621
Additions			0
Intangible assets amortization			(60)
Balance September 30, 2018	$ 561		561
Indefinite-lived Intangible Assets [Roll Forward]
Additions			0
Intangible assets amortization			(60)
Favorable lease assets | Minimum
Finite-lived Intangible Assets [Roll Forward]
Intangible asset amortization period (Year)	1 year
Favorable lease assets | Maximum
Finite-lived Intangible Assets [Roll Forward]
Intangible asset amortization period (Year)	16 years
Goodwill – Wealth
Goodwill [Roll Forward]
Balance December 31, 2017			20,412
Additions			0
Adjustments			0
Balance September 30, 2018	$ 20,412		20,412
Goodwill – Banking
Goodwill [Roll Forward]
Balance December 31, 2017			153,545
Additions			0
Adjustments			3,298
Balance September 30, 2018	156,843		156,843
Goodwill – Insurance
Goodwill [Roll Forward]
Balance December 31, 2017			5,932
Additions			677
Adjustments			0
Balance September 30, 2018	$ 6,609		$ 6,609

XML

Goodwill and Intangibles Assets - Narrative (Details) - USD ($)		11 Months Ended
	Oct. 31, 2017	Sep. 30, 2018
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill impairment	$ 0
Impairment of intangibles		$ 0

XML

Deposits (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Deposits [Abstract]
Interest-bearing demand	$ 578,243	$ 481,336
Money market	812,027	862,639
Savings	286,266	338,572
Retail time deposits	561,123	532,202
Wholesale non-maturity deposits	24,040	62,276
Wholesale time deposits	261,164	171,929
Total interest-bearing deposits	2,522,863	2,448,954
Noninterest-bearing deposits	834,363	924,844
Total deposits	$ 3,357,226	$ 3,373,798

XML

Short-Term Borrowings and Long-Term FHLB Advances - Short-term Borrowings (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017	Sep. 30, 2017
Short-term Debt [Line Items]
Short-term borrowings	$ 226,498	$ 237,865	$ 180,874
Repurchase agreements – commercial customers
Short-term Debt [Line Items]
Short-term borrowings	21,548	25,865
Short-term FHLB advances
Short-term Debt [Line Items]
Short-term borrowings	$ 204,950	$ 212,000

XML

Short-Term Borrowings and Long-Term FHLB Advances - Information Concerning Short-term Borrowings (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Long-term Federal Home Loan Bank Advances [Abstract]
Balance at period-end	$ 226,498	$ 180,874	$ 226,498	$ 180,874	$ 237,865
Maximum amount outstanding at any month end	302,932	184,578	302,932	184,578
Average balance outstanding during the period	$ 218,551	$ 182,845	$ 205,046	$ 110,268
Short-term debt, weighted average interest rate at period end (as a percent)	2.18%	1.17%	2.18%	1.17%
Short-term debt, weighted average interest rate aid during the period (as a percent)	2.09%	1.19%	1.85%	0.98%

XML

Short-Term Borrowings and Long-Term FHLB Advances - Narrative (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Federal Home Loan Bank, Advances [Line Items]
Long-term FHLB advances	$ 72,841	$ 139,140
Federal Home Loan Bank stock	14,678	$ 20,083
Federal Home Loan Bank maximum borrowing capacity	1,500,000
Federal Home Loan Bank, advances, amount available	1,200,000
Overnight Federal Funds
Federal Home Loan Bank, Advances [Line Items]
Federal Home Loan Bank, advances, amount available	79,000
Federal Reserve Discount Window
Federal Home Loan Bank, Advances [Line Items]
Federal Home Loan Bank, advances, amount available	$ 139,600

XML

Short-Term Borrowings and Long-Term FHLB Advances - Maturity of FHLB Advances and Other Borrowings (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Federal Home Loan Bank, Advances [Line Items]
Total	$ 72,841	$ 139,140
Short-term FHLB advances
Federal Home Loan Bank, Advances [Line Items]
Within one year	28,106	83,766
Over one year through five years	44,735	55,374
Total	$ 72,841	$ 139,140

XML

- Rate and Maturity Information on Federal Home Loan Bank Advances and Other Borrowings (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Federal Home Loan Bank, Advances [Line Items]
Other long-term debt	$ 72,841	$ 139,140
Bullet maturity – fixed rate | Fixed Rate
Federal Home Loan Bank, Advances [Line Items]
Other long-term debt	$ 72,841	118,131
Bullet maturity – fixed rate | Fixed Rate | Weighted average rate
Federal Home Loan Bank, Advances [Line Items]
Federal Home Loan Bank, advances, interest rate at period end	1.32%
Bullet maturity – fixed rate | Fixed Rate | Minimum
Federal Home Loan Bank, Advances [Line Items]
Federal Home Loan Bank, advances, interest rate at period end	1.31%
Bullet maturity – fixed rate | Fixed Rate | Maximum
Federal Home Loan Bank, Advances [Line Items]
Federal Home Loan Bank, advances, interest rate at period end	2.45%
Convertible-fixed
Federal Home Loan Bank, Advances [Line Items]
Other long-term debt	$ 0	$ 21,009

XML

Subordinated Notes - Narrative (Details) - Subordinated Debt - USD ($)	Dec. 13, 2017	Aug. 06, 2015
Subordinated notes – due 2027
Debt Instrument [Line Items]
Debt issued	$ 70,000,000
Subordinated notes – due 2025
Debt Instrument [Line Items]
Debt issued		$ 30,000,000

XML

Subordinated Notes - Subordinated Notes, Including Debt Issuance Costs (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Debt Instrument [Line Items]
Subordinated debt	$ 98,482	$ 98,416
Subordinated notes – due 2027
Debt Instrument [Line Items]
Subordinated debt	$ 68,855	$ 68,829
Stated interest rate	4.25%	4.25%
Subordinated notes – due 2025
Debt Instrument [Line Items]
Subordinated debt	$ 29,627	$ 29,587
Stated interest rate	4.75%	4.75%
Subordinated Debt | Subordinated notes – due 2027
Debt Instrument [Line Items]
Stated interest rate	4.25%
Subordinated Debt | Subordinated notes – due 2025
Debt Instrument [Line Items]
Stated interest rate	4.75%
Subordinated Debt | LIBOR | Subordinated notes – due 2027
Debt Instrument [Line Items]
Basis spread on variable rate	2.05%
Subordinated Debt | LIBOR | Subordinated notes – due 2025
Debt Instrument [Line Items]
Basis spread on variable rate	3.068%

XML

Junior Subordinated Debentures (Details) - USD ($)	9 Months Ended
	Sep. 30, 2018	Dec. 31, 2017	Dec. 15, 2017
Investment Holdings [Line Items]
Common securities of Trust I and Trust II owned	$ 16,529,000	$ 12,470,000
Royal Bancshares Capital Trust II
Investment Holdings [Line Items]
Capital securities issued, amount	12,500,000
Common securities issued, amount	387,000
Royal Bancshares Capital Trust I
Investment Holdings [Line Items]
Capital securities issued, amount	12,500,000
Common securities issued, amount	$ 387,000
Junior Subordinated Debentures, RBPI Merger | Junior Subordinated Debt
Investment Holdings [Line Items]
Coupon rate (as a percent)	4.48%
Junior Subordinated Debentures, RBPI Merger | Junior Subordinated Debt | LIBOR
Investment Holdings [Line Items]
Basis spread on variable rate	2.15%
Royal Bancshares of Pennsylvania, Inc.
Investment Holdings [Line Items]
Junior subordinated debentures			$ 21,400,000
Royal Bancshares of Pennsylvania, Inc. | Royal Bancshares Capital Trust I
Investment Holdings [Line Items]
Junior subordinated debentures			10,700,000
Royal Bancshares Capital Trust II
Investment Holdings [Line Items]
Common securities of Trust I and Trust II owned	$ 387,000
Royal Bancshares Capital Trust II | Royal Bancshares of Pennsylvania, Inc.
Investment Holdings [Line Items]
Junior subordinated debentures			10,700,000
Royal Bancshares Capital Trust I and II
Investment Holdings [Line Items]
Common securities of Trust I and Trust II owned			$ 774,000
Royal Bancshares Capital Trust I
Investment Holdings [Line Items]
Common securities of Trust I and Trust II owned	$ 387,000

XML

Derivative Instruments and Hedging Activities - Narrative (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative liability held as collateral	$ 420	$ 1,300
Fair value of net derivatives	$ 1,800	$ 1,600

XML

Derivative Instruments and Hedging Activities - Schedule of Derivative Instruments (Details) - Not Designated as Hedging Instrument - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Derivative Asset [Abstract]
Notional Amount	$ 331,030	$ 139,337
Fair Value	5,886	1,916
Derivative Liability [Abstract]
Notional Amount	296,431	125,526
Fair Value	5,844	1,898
Customer derivatives – interest rate swaps
Derivative Asset [Abstract]
Notional Amount	295,566	124,627
Fair Value	5,843	1,895
Derivative Liability [Abstract]
Notional Amount	295,566	124,627
Fair Value	5,843	1,895
RPAs sold
Derivative Asset [Abstract]
Notional Amount	0	0
Fair Value	0	0
Derivative Liability [Abstract]
Notional Amount	865	899
Fair Value	1	3
RPAs purchased
Derivative Asset [Abstract]
Notional Amount	35,464	14,710
Fair Value	43	21
Derivative Liability [Abstract]
Notional Amount	0	0
Fair Value	$ 0	$ 0

XML

Accounting for Uncertainty in Income Taxes (Details) - USD ($)	Sep. 30, 2018	Sep. 30, 2017
Income Tax Disclosure [Abstract]
Accrued interest and penalties	$ 0	$ 0

XML

Shareholders' Equity (Details) - USD ($)			3 Months Ended	9 Months Ended
	Oct. 17, 2018	Aug. 01, 2018	Sep. 30, 2018	Sep. 30, 2018	Dec. 31, 2017	Aug. 06, 2015
Class of Stock [Line Items]
Dividends paid (in dollars per share)			$ 0.25
Total dividends		$ 5,100,000
Common stock, outstanding (in shares)		20,443,918	20,292,420	20,292,420	20,161,395
Maximum investment under stock purchase and dividend reinvestment plan				$ 120,000
Shares issued pursuant to exercise of stock options (in shares)			15,150	63,825
Stock issued, increase in shareholders' equity			$ 349,000	$ 1,500,000
The 2015 Program
Class of Stock [Line Items]
Stock repurchase program, number of shares authorized to be repurchased						1,200,000
Shares repurchased during period			14,263
Shares remaining authorized for repurchase			$ 175,037	175,037
RSU's and PSU's
Class of Stock [Line Items]
Share based compensation expense			$ 708,000	$ 1,900,000
Maximum
Class of Stock [Line Items]
Shelf registration, shares registered			1,500,000	1,500,000
Maximum | The 2015 Program
Class of Stock [Line Items]
Stock repurchase program, authorized amount						$ 40,000,000
Subsequent Event
Class of Stock [Line Items]
Dividends declared per share (in dollars per share)	$ 0.25

XML

Accumulated Other Comprehensive (Loss) Income - Components of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning balance			$ 528,802
Other comprehensive income (loss)	$ (2,211)	$ 164	(8,988)	$ 1,009
Ending balance	552,103		552,103
Net Change in Unrealized Gains on Available-for- Sale Investment Securities
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning balance	(9,669)	(433)	(2,861)	(1,231)
Other comprehensive income (loss)	(2,319)	149	(9,127)	947
Ending balance	(11,988)	(284)	(11,988)	(284)
Net Change in Unfunded Pension Liability
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning balance	(1,522)	(1,131)	(1,553)	(1,178)
Other comprehensive income (loss)	108	15	139	62
Ending balance	(1,414)	(1,116)	(1,414)	(1,116)
AOCI Attributable to Parent
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning balance	(11,191)	(1,564)	(4,414)	(2,409)
Other comprehensive income (loss)			(8,988)
Ending balance	$ (13,402)	$ (1,400)	$ (13,402)	$ (1,400)

XML

Accumulated Other Comprehensive (Loss) Income - Amounts Reclassified From Each Component of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items]
Other operating expenses	$ 4,668	$ 4,071	$ 12,970	$ 11,353
Other operating income	3,171	1,405	10,543	3,779
Income before income taxes	20,747	15,505	59,080	43,522
Income tax expense	4,066	4,766	12,419	14,306
Net income attributable to Bryn Mawr Bank Corporation	16,682	10,739	46,656	29,216
Amount Reclassified from Accumulated Other Comprehensive Loss | Net Change in Unrealized Gains on Available-for- Sale Investment Securities
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items]
Realization of gain on sale of investment securities available for sale	0	(72)	7	73
Other operating income	0	0	417	0
Income before income taxes	0	(72)	424	73
Income tax expense	0	(25)	89	27
Net income attributable to Bryn Mawr Bank Corporation	0	(47)	335	46
Amount Reclassified from Accumulated Other Comprehensive Loss | Net Change in Unfunded Pension Liability
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items]
Other operating expenses	25	24	75	71
Income tax expense	5	8	15	25
Net income attributable to Bryn Mawr Bank Corporation	$ 20	$ 16	$ 60	$ 46

XML

Earnings per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Earnings Per Share [Abstract]
Net income attributable to Bryn Mawr Bank Corporation	$ 16,682	$ 10,739	$ 46,656	$ 29,216
Denominator for basic earnings per share – weighted average shares outstanding	20,270,706	17,023,046	20,237,757	16,987,499
Effect of dilutive common shares	167,670	230,936	206,318	254,728
Denominator for diluted earnings per share – adjusted weighted average shares outstanding	20,438,376	17,253,982	20,444,075	17,242,227
Basic earnings per share (in dollars per share)	$ 0.82	$ 0.63	$ 2.31	$ 1.72
Diluted earnings per share (in dollars per share)	$ 0.82	$ 0.62	$ 2.28	$ 1.69
Antidilutive shares excluded from computation of average dilutive earnings per share	22,232	21,621	48,807	47,268

XML

Revenue from Contracts with Customers (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Disaggregation of Revenue [Line Items]
Insurance commissions	$ 1,754	$ 1,373	$ 5,349	$ 3,079
Capital markets revenue	710	843	3,481	1,796
Loan servicing and other fees	559	548	1,720	1,570
Net gain on sale of loans	631	799	1,677	1,948
Net gain on sale of investment securities available for sale	0	72	7	73
Net gain (loss) on sale of other real estate owned (OREO)	5	0	292	(12)
Dividends on FHLB and FRB stock	375	217	1,316	649
Other operating income	3,171	1,405	10,543	3,779
Total noninterest income	18,274	15,584	57,885	43,596
Fees for wealth management services
Disaggregation of Revenue [Line Items]
Revenue	10,343	9,651	31,309	28,761
Service charges on deposit accounts
Disaggregation of Revenue [Line Items]
Revenue	726	676	2,191	1,953
Merchant Interchange Fees, Safe Deposit Box Rentals, and Rent Income
Disaggregation of Revenue [Line Items]
Revenue	595	520	1,700	1,500
Banking
Disaggregation of Revenue [Line Items]
Insurance commissions	0	0	0	0
Capital markets revenue	710	843	3,481	1,796
Loan servicing and other fees	559	548	1,720	1,570
Net gain on sale of loans	631	799	1,677	1,948
Net gain on sale of investment securities available for sale	0	72	7	73
Net gain (loss) on sale of other real estate owned (OREO)	5	0	292	(12)
Dividends on FHLB and FRB stock	375	217	1,316	649
Other operating income	3,123	1,364	10,393	3,641
Total noninterest income	6,129	4,519	21,077	11,618
Banking | Fees for wealth management services
Disaggregation of Revenue [Line Items]
Revenue	0	0	0	0
Banking | Service charges on deposit accounts
Disaggregation of Revenue [Line Items]
Revenue	726	676	2,191	1,953
Wealth Management
Disaggregation of Revenue [Line Items]
Insurance commissions	1,754	1,373	5,349	3,079
Capital markets revenue	0	0	0	0
Loan servicing and other fees	0	0	0	0
Net gain on sale of loans	0	0	0	0
Net gain on sale of investment securities available for sale	0	0	0	0
Net gain (loss) on sale of other real estate owned (OREO)	0	0	0	0
Dividends on FHLB and FRB stock	0	0	0	0
Other operating income	48	41	150	138
Total noninterest income	12,145	11,065	36,808	31,978
Wealth Management | Fees for wealth management services
Disaggregation of Revenue [Line Items]
Revenue	10,343	9,651	31,309	28,761
Wealth Management | Service charges on deposit accounts
Disaggregation of Revenue [Line Items]
Revenue	$ 0	$ 0	$ 0	$ 0

XML

Stock-Based Compensation - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2018	Apr. 30, 2015	Apr. 29, 2015	Apr. 28, 2010	Apr. 25, 2007
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Performance shares, minimum target (as a percent)		0.00%
Performance shares, maximum target (as a percent)		150.00%
Number of unvested options (in shares)	0	0
Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share based compensation expense	$ 318	$ 873
Unrecognized compensation costs	2,300	$ 2,300
Unrecognized compensation costs, period of recognition		2 years 3 months 18 days
Performance Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share based compensation expense	390	$ 1,100
Unrecognized compensation costs	$ 3,300	$ 3,300
Unrecognized compensation costs, period of recognition		2 years 2 months 12 days
The 2007 Long-Term Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares available for grant						428,996
The 2010 Long-Term Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares available for grant			945,002	500,000	445,002

XML

Stock-Based Compensation - Schedule of Stock Option Activity (Details) - $ / shares	3 Months Ended	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2018
Shares
Options outstanding (in shares)	66,571	115,246
Forfeited (in shares)	0	0
Expired (in shares)	0	0
Exercised (in shares)	(15,150)	(63,825)
Options outstanding (in shares)	51,421	51,421
Weighted Average Exercise Price
Options outstanding, weighted average exercise price (in dollars per share)	$ 19.26	$ 20.73
Forfeited, weighted average exercise price (in dollars per share)	0.00	0.00
Expired, weighted average exercise price (in dollars per share)	0.00	0.00
Exercised, weighted average exercise price (in dollars per share)	23.02	22.81
Options outstanding, weighted average exercise price (in dollars per share)	18.15	18.15
Weighted Average Grant Date Fair Value
Options outstanding, weighted average grant date fair value (in dollars per share)	4.71	4.86
Forfeited, weighted average grant date fair value (in dollars per share)	0.00	0.00
Expired, weighted average grant date fair value (in dollars per share)	0.00	0.00
Exercised, weighted average grant date fair value (in dollars per share)	5.09	5.06
Options outstanding, weighted average grant date fair value (in dollars per share)	$ 4.60	$ 4.60

XML

Stock-Based Compensation - Proceeds, Related Tax Benefits Realized from Options Exercised and Intrinsic Value of Options Exercised (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Proceeds from exercise of stock options	$ 349	$ 283	$ 1,456	$ 1,288
Related tax benefit recognized	81	96	312	402
Net proceeds of options exercised	430	379	1,768	1,690
Intrinsic value of options exercised	$ 386	$ 273	$ 1,484	$ 1,147

XML

Stock-Based Compensation - Options Outstanding and Exercisable (Details) - USD ($) $ / shares in Units, $ in Thousands	9 Months Ended
	Sep. 30, 2018	Jun. 30, 2018	Dec. 31, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Options outstanding (in shares)	51,421	66,571	115,246
Weighted average exercise price, options outstanding (in dollars per share)	$ 18.15	$ 19.26	$ 20.73
Aggregate intrinsic value, options outstanding	$ 1,478
Weighted average contractual term, options outstanding (Year)	10 months 24 days
Exercisable options (in shares)	51,421
Weighted average exercise price, exercisable options (in dollars per share)	$ 18.15
Aggregate intrinsic value, exercisable options	$ 1,478
Weighted average contractual term, exercisable options (Year)	10 months 24 days

XML

Stock-Based Compensation - Unvested Restricted Stock Units Awards (Details) - Restricted Stock Units (RSUs) - $ / shares	3 Months Ended	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2018
Number of Shares
Balance (in shares)	68,595	75,707
Granted (in shares)	23,843	26,243
Vested (in shares)	(16,122)	(24,469)
Forfeited (in shares)	0	(1,165)
Balance (in shares)	76,316	76,316
Weighted Average Grant Date Fair Value
Balance, weighted average grant date fair value (in dollars per share)	$ 36.89	$ 35.80
Granted, weighted average grant date fair value (in dollars per share)	46.29	46.07
Vested, weighted average grant date fair value (in dollars per share)	33.65	32.16
Forfeited, weighted average grant date fair value (in dollars per share)	0.00	35.36
Balance, weighted average grant date fair value (in dollars per share)	$ 40.51	$ 40.51

XML

Stock-Based Compensation - Unvested Performance Stock Awards (Details) - Performance Stock Awards - $ / shares	3 Months Ended	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2018
Number of Shares
Balance (in shares)	130,260	168,453
Granted (in shares)	40,722	40,722
Vested (in shares)	(48,056)	(81,840)
Forfeited (in shares)	0	(4,409)
Balance (in shares)	122,926	122,926
Weighted Average Grant Date Fair Value
Balance, weighted average grant date fair value (in dollars per share)	$ 26.73	$ 24.76
Granted, weighted average grant date fair value (in dollars per share)	44.56	44.56
Vested, weighted average grant date fair value (in dollars per share)	16.04	16.40
Forfeited, weighted average grant date fair value (in dollars per share)	0.00	26.57
Balance, weighted average grant date fair value (in dollars per share)	$ 36.82	$ 36.82

XML

Fair Value Measurement - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2018
Allowance for Loan and Lease Loss
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Valuation allowance, period increase (decrease)	$ (148)	$ 20
Minimum
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Discount on appraisals of secured collateral (as a percent)		10.00%
Maximum
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Discount on appraisals of secured collateral (as a percent)		50.00%

XML

Fair Value Measurement - Schedule of Assets Measured on Recurring and Non-recurring Basis (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	$ 528,064	$ 689,202
Fair Value, Measurements, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	528,064	689,202
Derivatives	5,886	1,898
Total financial assets	542,290	695,710
Fair Value, Measurements, Recurring | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	100	203,597
Derivatives	0	0
Total financial assets	8,440	208,207
Fair Value, Measurements, Recurring | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	527,964	485,605
Derivatives	5,886	1,898
Total financial assets	533,850	487,503
Fair Value, Measurements, Recurring | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	0	0
Derivatives	0	0
Total financial assets	0	0
Fair Value, Measurements, Recurring | U.S. Treasury securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	100	200,088
Fair Value, Measurements, Recurring | U.S. Treasury securities | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	100	200,088
Fair Value, Measurements, Recurring | U.S. Treasury securities | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	0	0
Fair Value, Measurements, Recurring | U.S. Treasury securities | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	0	0
Fair Value, Measurements, Recurring | Obligations of the U.S. government and agencies
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	190,453	151,044
Fair Value, Measurements, Recurring | Obligations of the U.S. government and agencies | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	0	0
Fair Value, Measurements, Recurring | Obligations of the U.S. government and agencies | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	190,453	151,044
Fair Value, Measurements, Recurring | Obligations of the U.S. government and agencies | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	0	0
Fair Value, Measurements, Recurring | Obligations of state and political subdivisions
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	15,799	21,310
Fair Value, Measurements, Recurring | Obligations of state and political subdivisions | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	0	0
Fair Value, Measurements, Recurring | Obligations of state and political subdivisions | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	15,799	21,310
Fair Value, Measurements, Recurring | Obligations of state and political subdivisions | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	0	0
Fair Value, Measurements, Recurring | Mortgage-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	284,421	274,990
Fair Value, Measurements, Recurring | Mortgage-backed securities | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	0	0
Fair Value, Measurements, Recurring | Mortgage-backed securities | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	284,421	274,990
Fair Value, Measurements, Recurring | Mortgage-backed securities | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	0	0
Fair Value, Measurements, Recurring | Collateralized mortgage obligations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	36,193	36,662
Fair Value, Measurements, Recurring | Collateralized mortgage obligations | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	0	0
Fair Value, Measurements, Recurring | Collateralized mortgage obligations | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	36,193	36,662
Fair Value, Measurements, Recurring | Collateralized mortgage obligations | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	0	0
Fair Value, Measurements, Recurring | Other investment securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	1,098	1,599
Fair Value, Measurements, Recurring | Other investment securities | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	0	0
Fair Value, Measurements, Recurring | Other investment securities | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	1,098	1,599
Fair Value, Measurements, Recurring | Other investment securities | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	0	0
Fair Value, Measurements, Recurring | Mutual funds with no stated maturity
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value		3,509
Investment securities trading	8,340	4,610
Fair Value, Measurements, Recurring | Mutual funds with no stated maturity | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value		3,509
Investment securities trading	8,340	4,610
Fair Value, Measurements, Recurring | Mutual funds with no stated maturity | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value		0
Investment securities trading	0	0
Fair Value, Measurements, Recurring | Mutual funds with no stated maturity | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value		0
Investment securities trading	0	0
Fair Value, Measurements, Nonrecurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total financial assets	19,708	20,655
MSRs	6,586	6,397
Impaired loans and leases	12,593	13,954
OREO	529	304
Fair Value, Measurements, Nonrecurring | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total financial assets	0	0
MSRs	0	0
Impaired loans and leases	0	0
OREO	0	0
Fair Value, Measurements, Nonrecurring | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total financial assets	0	0
MSRs	0	0
Impaired loans and leases	0	0
OREO	0	0
Fair Value, Measurements, Nonrecurring | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total financial assets	19,708	20,655
MSRs	6,586	6,397
Impaired loans and leases	12,593	13,954
OREO	$ 529	$ 304

XML

Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Financial assets:
Investment securities - available for sale	$ 528,064	$ 689,202
Investment securities, trading	8,340	4,610
Investment securities – held to maturity	8,544	7,851
Carrying Amount
Financial assets:
Investment securities - available for sale	528,064	689,202
Investment securities, trading	8,340	4,610
Total financial assets	4,013,229	4,088,471
Financial liabilities:
Total financial liabilities	3,842,861	3,921,604
Fair Value
Financial assets:
Investment securities - available for sale	528,064	689,202
Investment securities, trading	8,340	4,610
Total financial assets	4,014,081	4,114,395
Financial liabilities:
Total financial liabilities	3,837,391	3,910,205
Level 1 | Carrying Amount
Financial assets:
Cash and cash equivalents	45,354	60,024
Level 1 | Fair Value
Financial assets:
Cash and cash equivalents	45,354	60,024
Level 2 | Carrying Amount
Financial assets:
Investment securities – held to maturity	8,916	7,932
Loans held for sale	4,111	3,794
Financial liabilities:
Deposits	3,357,226	3,373,798
Short-term borrowings	226,498	237,865
Long-term FHLB advances	72,841	139,140
Subordinated notes	98,482	98,416
Junior subordinated debentures	21,538	21,416
Level 2 | Carrying Amount | Interest rate swaps
Financial assets:
Derivative assets	5,843	1,895
Financial liabilities:
Derivative liabilities	5,843	1,895
Level 2 | Carrying Amount | RPAs purchased
Financial assets:
Derivative assets	43	21
Level 2 | Carrying Amount | RPAs sold
Financial liabilities:
Derivative liabilities	1	3
Level 2 | Fair Value
Financial assets:
Investment securities – held to maturity	8,544	7,851
Loans held for sale	4,111	3,794
Financial liabilities:
Deposits	3,351,183	3,368,276
Short-term borrowings	226,498	237,865
Long-term FHLB advances	71,978	138,685
Subordinated notes	97,892	95,044
Junior subordinated debentures	23,564	19,366
Level 2 | Fair Value | Interest rate swaps
Financial assets:
Derivative assets	5,843	1,895
Financial liabilities:
Derivative liabilities	5,843	1,895
Level 2 | Fair Value | RPAs purchased
Financial assets:
Derivative assets	43	21
Level 2 | Fair Value | RPAs sold
Financial liabilities:
Derivative liabilities	1	3
Level 3 | Carrying Amount
Financial assets:
Net portfolio loans and leases	3,362,791	3,268,333
MSRs	5,328	5,861
Other assets	44,439	46,799
Financial liabilities:
Other liabilities	60,432	49,071
Level 3 | Fair Value
Financial assets:
Net portfolio loans and leases	3,362,757	3,293,802
MSRs	6,586	6,397
Other assets	44,439	46,799
Financial liabilities:
Other liabilities	$ 60,432	$ 49,071

XML

Financial Instruments With Off-Balance Sheet Risk, Contingencies and Concentration of Credit Risk (Details) - USD ($) $ in Millions	Sep. 30, 2018	Dec. 31, 2017
Standby Letters of Credit
Loss Contingencies [Line Items]
Commitments and obligations, liability outstanding	$ 21.2	$ 17.7
Commitments to Extend Credit
Loss Contingencies [Line Items]
Commitments and obligations, liability outstanding	$ 764.7	$ 748.3

XML

Segment Information (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Segment Reporting Information [Line Items]
Net interest income	$ 36,729	$ 29,438	$ 111,484	$ 84,806
Provision for loan and lease losses	664	1,333	4,831	1,541
Net interest income after provision for loan and lease losses	36,065	28,105	106,653	83,265
Fees for wealth management services	10,343	9,651	31,309	28,761
Insurance commissions	1,754	1,373	5,349	3,079
Capital markets revenue	710	843	3,481	1,796
Service charges on deposit accounts	726	676	2,191	1,953
Loan servicing and other fees	559	548	1,720	1,570
Net gain on sale of loans	631	799	1,677	1,948
Net gain on sale of investment securities available for sale			7	73
Net gain on sale of OREO	5	0	292	(12)
Other operating income	3,546	1,622	11,859	4,428
Total noninterest income	18,274	15,584	57,885	43,596
Salaries and wages	16,528	13,602	48,750	39,632
Employee benefits	3,356	2,560	9,941	7,453
Occupancy and bank premises	2,717	2,485	8,464	7,258
Amortization of intangible assets	891	677	2,659	2,057
Professional fees	997	739	2,677	2,499
Other operating expenses	9,103	8,121	32,967	24,440
Total noninterest expenses	33,592	28,184	105,458	83,339
Segment profit	20,747	15,505	59,080	43,522
Intersegment (revenues) expenses	0	0	0	0
Pre-tax segment profit after eliminations	$ 20,747	$ 15,505	$ 59,080	$ 43,522
% of segment pre-tax profit after eliminations	100.00%	100.00%	100.00%	100.00%
Segment assets	$ 4,388,442	$ 3,476,800	$ 4,388,442	$ 3,476,800	$ 4,449,720
Assets under management, administration, supervision and brokerage	13,913,300		13,913,300		$ 12,968,700
Banking
Segment Reporting Information [Line Items]
Net interest income	36,726	29,437	111,479	84,804
Provision for loan and lease losses	664	1,333	4,831	1,541
Net interest income after provision for loan and lease losses	36,062	28,104	106,648	83,263
Fees for wealth management services	0	0	0	0
Insurance commissions	0	0	0	0
Capital markets revenue	710	843	3,481	1,796
Service charges on deposit accounts	726	676	2,191	1,953
Loan servicing and other fees	559	548	1,720	1,570
Net gain on sale of loans	631	799	1,677	1,948
Net gain on sale of investment securities available for sale			7	73
Net gain on sale of OREO	5	0	292	(12)
Other operating income	3,498	1,581	11,709	4,290
Total noninterest income	6,129	4,519	21,077	11,618
Salaries and wages	11,737	9,130	34,077	27,044
Employee benefits	2,394	1,587	6,992	4,565
Occupancy and bank premises	2,224	2,049	7,035	6,025
Amortization of intangible assets	386	197	1,169	588
Professional fees	889	681	2,497	2,318
Other operating expenses	7,770	6,970	29,076	21,200
Total noninterest expenses	25,400	20,614	80,846	61,740
Segment profit	16,791	12,009	46,879	33,141
Intersegment (revenues) expenses	(186)	(112)	(485)	(336)
Pre-tax segment profit after eliminations	$ 16,605	$ 11,897	$ 46,394	$ 32,805
% of segment pre-tax profit after eliminations	80.00%	76.70%	78.50%	75.40%
Segment assets	$ 4,335,800	$ 3,424,800	$ 4,335,800	$ 3,424,800
Wealth Management
Segment Reporting Information [Line Items]
Net interest income	3	1	5	2
Provision for loan and lease losses	0	0	0	0
Net interest income after provision for loan and lease losses	3	1	5	2
Fees for wealth management services	10,343	9,651	31,309	28,761
Insurance commissions	1,754	1,373	5,349	3,079
Capital markets revenue	0	0	0	0
Service charges on deposit accounts	0	0	0	0
Loan servicing and other fees	0	0	0	0
Net gain on sale of loans	0	0	0	0
Net gain on sale of investment securities available for sale			0	0
Net gain on sale of OREO	0	0	0	0
Other operating income	48	41	150	138
Total noninterest income	12,145	11,065	36,808	31,978
Salaries and wages	4,791	4,472	14,673	12,588
Employee benefits	962	973	2,949	2,888
Occupancy and bank premises	493	436	1,429	1,233
Amortization of intangible assets	505	480	1,490	1,469
Professional fees	108	58	180	181
Other operating expenses	1,333	1,151	3,891	3,240
Total noninterest expenses	8,192	7,570	24,612	21,599
Segment profit	3,956	3,496	12,201	10,381
Intersegment (revenues) expenses	186	112	485	336
Pre-tax segment profit after eliminations	$ 4,142	$ 3,608	$ 12,686	$ 10,717
% of segment pre-tax profit after eliminations	20.00%	23.30%	21.50%	24.60%
Segment assets	$ 52,600	$ 52,000	$ 52,600	$ 52,000