Acquisitions (Tables)

12 Months Ended

Dec. 31, 2020

Schedule of Recognized Identifiable Assets Acquired and Liabilities Assumed

The following table summarizes the consideration paid, fair values of the IIBK assets acquired and liabilities assumed, and the resulting goodwill. All amounts reported were finalized during the fourth quarter of 2019.


	As Recorded		Fair Value			As Recorded
As of April 8, 2019	by IIBK		Adjustments			by the Company

Assets acquired:
Cash and cash equivalents	$	270.7	$	—		$	270.7
Investment securities	62.7		0.5		(1)	63.2
Loans held for investment	347.6		(9.8)		(2)	337.8
Mortgage loans held for sale	0.5		—			0.5
Allowance for loan loss	(6.3)		6.3		(3)	—
Premises and equipment	16.5		4.8		(4)	21.3
Other real estate owned (“OREO”)	0.4		2.0		(5)	2.4
Company owned life insurance	15.2		—			15.2
Core deposit intangible assets	—		13.6		(6)	13.6
Deferred tax assets, net	3.2		(2.6)		(7)	0.6
Other assets	8.6		(0.7)		(8)	7.9
Total assets acquired	719.1		14.1			733.2

Liabilities assumed:
Deposits	596.5		0.1		(9)	596.6
Accounts payable and accrued expense	15.2		2.6		(10)	17.8
Other borrowed funds	4.0		0.1		(11)	4.1
Securities sold under repurchase agreements	30.4		—			30.4


Total liabilities assumed	646.1		2.8			648.9
Net assets acquired	$	73.0	$	11.3		$	84.3

Consideration paid:

Class A common stock						$	157.3
Total consideration paid						$	157.3
Goodwill						$	73.0


Explanation of fair value adjustments and the removal of previously recorded fair value marks recorded by IIBK:
(1)			Write up of the book value of investments to their estimated fair values on the date of acquisition based upon quotes obtained from an independent third-party pricing service.


(2)			Write down of the book value of loans to their estimated fair values. The fair value of the loans was estimated using cash flow projections based on the remaining maturity and repricing terms, adjusted for estimated future credit losses and prepayments and discounted to present value using a risk-adjusted market rate for similar loans. The fair value of collateral dependent loans acquired with deteriorated credit quality was estimated based on the Company’s analysis of the fair value of each loan’s underlying collateral, discounted using market-derived rates of return with consideration given to the period of time and costs associated with foreclosure and disposition of the collateral.
(3)			Adjustment to remove the IIBK allowance for loan losses at acquisition date, as the credit risk is included in the fair value adjustment for loans receivable described in (2) above.
(4)			Write up of the book value of premises and equipment to their estimated fair values on the date of acquisition based upon broker’s opinion of value.
(5)			Adjustment to the book value of other real estate owned to their estimated fair values on the date of acquisition based on appraisal value.
(6)			Adjustment represents the value of the core deposit base assumed in the acquisition based upon valuation from an independent accounting and advisory firm.
(7)			Adjustment consists of the write-off of pre-existing deferred tax assets and purchase accounting adjustments as a result of the acquisition.
(8)			Adjustment consists of reductions to the fair value of other items.
(9)			Increase in book value of time deposits to their estimated fair values based upon interest rates of similar time deposits with similar terms on the date of acquisition based upon valuation from an independent accounting and advisory firm.
(10)			Adjustment to the liability for the nonqualified retirement plan.
(11)			Adjustment of the book value of debt to the estimated fair values on the date of acquisition based upon interest rates in the market.

Acquisition Related Expenses

These costs are incorporated in non-interest expense in the Company’s consolidated statements of income.

Certain Loans Acquired in Transfer Not Accounted for as Debt Securities Acquired During Period

Information regarding IIBK loans acquired deemed credit impaired as of the April 8, 2019 acquisition date are as follows:


Contractually required principal and interest payments	$	24.1
Contractual cash flows not expected to be collected (“non-accretable discount”)	3.9
Cash flows expected to be collected	20.2
Interest component of cash flows expected to be collected (“accretable discount”)	3.4
Fair value of acquired credit-impaired loans	$	16.8

Information regarding IIBK acquired loans not deemed credit-impaired at the April 8, 2019 acquisition date are as follows:


Contractually required principal and interest payments	$	398.7
Contractual cash flows not expected to be collected	15.2
Fair value at acquisition	$	321.5