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Employee Benefit Plans
12 Months Ended
Dec. 31, 2018
Retirement Benefits [Abstract]  
Employee Benefit Plans
EMPLOYEE BENEFIT PLANS
Profit Sharing Plan
The Company has a profit sharing plan for all its eligible employees. The Company’s discretionary annual contribution to the plan is determined by its Board of Directors. Annual contributions are allocated to participants on a point basis with accumulated benefits payable at retirement, or, at the discretion of the plan committee, upon termination of employment. There were no contributions made by the Company in 2018 or 2017, while contributions made by the Company totaled $600,000 for the year ended 2016.
Benefit Obligations from Somerset Hills Acquisition
Somerset Hills, acquired by the Company in 2013, entered into a non-qualified Supplemental Executive Retirement Plan (“SERP”) with its former Chief Executive Officer and its Chief Financial Officer which entitles them to a benefit of $48,000 and $24,000, respectively, per year for 15 years after the earlier of retirement or death. The former Chief Executive Officer and the beneficiary of the Chief Financial Officer are currently being paid out under the plan. As of December 31, 2018 and 2017, the Company had a liability of $629,000 and $702,000, respectively, for these SERPs and recognized an expense of $(1,000), $33,000 and $0 in 2018, 2017 and 2016, respectively.
401(k) plan
The Company has a 401(k) plan covering substantially all employees providing they meet eligibility requirements. The Company matches 50% of the first 6% contributed by the participants to the 401(k) plan. The Company’s contributions in 2018, 2017 and 2016 totaled $1.1 million, $1.0 million and $911,000, respectively.
Supplemental Executive Retirement Plans
In December 2003, the Company entered into a SERP agreement with its former CEO that provides annual retirement benefits of $150,000 a year for a 15 year period when the former CEO reached the age of 65. Our former CEO retired and is receiving annual retirement benefits pursuant to the plan. In 2008, the Company entered into a SERP agreement with its current CEO that provides annual retirement benefits of $150,000 for a 15 year period when the CEO reaches the age of 65. In November 2008, the Company entered into a SERP with a Regional President that provides annual retirement benefits of $90,000 a year for a 10 year period upon his reaching the age of 65. In December 2016, the Company entered into a SERP with a former Regional President that provides $84,500 a year for a 15 year period upon his reaching the age of 66. The Company intends to fund its obligations under the deferred compensation arrangements with the increase in cash surrender value of bank owned life insurance policies. In 2018, 2017 and 2016, the Company recorded compensation expense of $83,000, $261,000 and $746,000, respectively, for these plans. The accrued liability for these plans was $3.3 million and $3.5 million for the years ended December 31, 2018 and 2017, respectively.
Deferred Compensation Agreement
In February 2015, the Company entered into a Deferred Compensation Agreement with its CEO where it would contribute $16,500 monthly into a deferral account which would earn interest at an annual rate of the Company’s prior year return on equity, provided that the Company’s return on equity remained in a range of 0% to 15%. The Company has agreed to make such contributions each month that the CEO is actively employed from February 2015 through December 31, 2022. The expense incurred in 2018, 2017 and 2016 was $269,000, $244,000 and $222,000, respectively, and the accrued liability at December 31, 2018 and 2017 was $923,000 and $654,000, respectively. Following the CEO’s normal retirement date, he shall be paid out in 180 consecutive monthly installments.
Elective Deferral Plan
In March 2015, the Company established an Elective Deferral Plan for eligible executives in which the executive may elect to contribute a portion of his base salary and bonus to a deferral account which will earn an interest rate of 75% of the Company’s prior year return on equity provided that the return on equity remains in the range of 0% to 15%. The Company recorded an expense of $73,000, $55,000 and $22,000 in 2018, 2017 and 2016, respectively, and had a liability recorded of $1.4 million and $916,000 at December 31, 2018 and 2017, respectively.