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Indiana
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35-1068133
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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100 North Michigan Street, South Bend, Indiana
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46601
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
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Name of each exchange on which registered
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Common Stock — without par value
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The NASDAQ Stock Market LLC
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Large accelerated filer
x
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Accelerated filer
o
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Non-accelerated filer
o
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Smaller reporting company
o
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Emerging growth company
o
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Certifications
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2017 Sales Price
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Cash Dividends
|
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2016 Sales Price
|
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Cash Dividends
|
||||||||||||||||
Common Stock Prices
(quarter ended)
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High
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Low
|
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Paid
|
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High
|
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Low
|
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Paid
|
||||||||||||
March 31
|
|
$
|
49.11
|
|
|
$
|
42.15
|
|
|
$
|
0.18
|
|
|
$
|
33.50
|
|
|
$
|
27.01
|
|
|
$
|
0.18
|
|
June 30
|
|
50.78
|
|
|
43.58
|
|
|
0.19
|
|
|
34.83
|
|
|
30.32
|
|
|
0.18
|
|
||||||
September 30
|
|
51.80
|
|
|
44.59
|
|
|
0.19
|
|
|
35.99
|
|
|
31.50
|
|
|
0.18
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|
||||||
December 31
|
|
53.29
|
|
|
47.16
|
|
|
0.20
|
|
|
45.61
|
|
|
33.27
|
|
|
0.18
|
|
|
Period
|
|
Total Number of
Shares Purchased
|
|
Average Price
Paid Per Share
|
|
Total Number of
Shares Purchased as
Part of Publicly Announced
Plans or Programs*
|
|
Maximum Number (or Approximate
Dollar Value) of Shares that
may yet be Purchased Under
the Plans or Programs
|
|||||
October 01 - 31, 2017
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
1,386,174
|
|
November 01 - 30, 2017
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,386,174
|
|
|
December 01 - 31, 2017
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,386,174
|
|
|
(Dollars in thousands, except per share amounts)
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
Interest income
|
|
$
|
212,385
|
|
|
$
|
191,760
|
|
|
$
|
184,684
|
|
|
$
|
178,554
|
|
|
$
|
179,585
|
|
Interest expense
|
|
26,754
|
|
|
22,101
|
|
|
18,163
|
|
|
18,225
|
|
|
22,768
|
|
|||||
Net interest income
|
|
185,631
|
|
|
169,659
|
|
|
166,521
|
|
|
160,329
|
|
|
156,817
|
|
|||||
Provision for loan and lease losses
|
|
8,980
|
|
|
5,833
|
|
|
2,160
|
|
|
3,733
|
|
|
772
|
|
|||||
Net interest income after provision for loan and lease losses
|
|
176,651
|
|
|
163,826
|
|
|
164,361
|
|
|
156,596
|
|
|
156,045
|
|
|||||
Noninterest income
|
|
98,706
|
|
|
88,945
|
|
|
83,316
|
|
|
77,887
|
|
|
77,212
|
|
|||||
Noninterest expense
|
|
173,997
|
|
|
163,645
|
|
|
159,114
|
|
|
150,040
|
|
|
149,314
|
|
|||||
Income before income taxes
|
|
101,360
|
|
|
89,126
|
|
|
88,563
|
|
|
84,443
|
|
|
83,943
|
|
|||||
Income taxes
|
|
33,309
|
|
|
31,340
|
|
|
31,077
|
|
|
26,374
|
|
|
28,985
|
|
|||||
Net income
|
|
$
|
68,051
|
|
|
$
|
57,786
|
|
|
$
|
57,486
|
|
|
$
|
58,069
|
|
|
$
|
54,958
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Assets at year-end
|
|
$
|
5,887,284
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|
|
$
|
5,486,268
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|
|
$
|
5,187,916
|
|
|
$
|
4,829,958
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|
|
$
|
4,722,826
|
|
Long-term debt and mandatorily redeemable securities at year-end
|
|
70,060
|
|
|
74,308
|
|
|
57,379
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|
|
56,232
|
|
|
58,335
|
|
|||||
Shareholders’ equity at year-end
|
|
718,537
|
|
|
672,650
|
|
|
644,053
|
|
|
614,473
|
|
|
585,378
|
|
|||||
Basic net income per common share
|
|
2.60
|
|
|
2.22
|
|
|
2.17
|
|
|
2.17
|
|
|
2.03
|
|
|||||
Diluted net income per common share
|
|
2.60
|
|
|
2.22
|
|
|
2.17
|
|
|
2.17
|
|
|
2.03
|
|
|||||
Cash dividends per common share
|
|
0.760
|
|
|
0.720
|
|
|
0.671
|
|
|
0.645
|
|
|
0.618
|
|
|||||
Dividend payout ratio
|
|
29.23
|
%
|
|
32.45
|
%
|
|
30.85
|
%
|
|
29.71
|
%
|
|
30.49
|
%
|
|||||
Return on average assets
|
|
1.21
|
%
|
|
1.08
|
%
|
|
1.15
|
%
|
|
1.21
|
%
|
|
1.19
|
%
|
|||||
Return on average common shareholders’ equity
|
|
9.69
|
%
|
|
8.71
|
%
|
|
9.05
|
%
|
|
9.65
|
%
|
|
9.55
|
%
|
|||||
Average common shareholders’ equity to average assets
|
|
12.46
|
%
|
|
12.38
|
%
|
|
12.72
|
%
|
|
12.52
|
%
|
|
12.49
|
%
|
•
|
Local, regional, national, and international economic conditions and the impact they may have on us and our clients and our assessment of that impact.
|
•
|
Changes in the level of nonperforming assets and charge-offs.
|
•
|
Changes in estimates of future cash reserve requirements based upon the periodic review thereof under relevant regulatory and accounting requirements.
|
•
|
The effects of and changes in trade and monetary and fiscal policies and laws, including the interest rate policies of the Federal Reserve Board.
|
•
|
Inflation, interest rate, securities market, and monetary fluctuations.
|
•
|
Political instability.
|
•
|
Acts of war or terrorism.
|
•
|
Substantial changes in the cost of fuel.
|
•
|
The timely development and acceptance of new products and services and perceived overall value of these products and services by others.
|
•
|
Changes in consumer spending, borrowings, and savings habits.
|
•
|
Changes in the financial performance and/or condition of our borrowers.
|
•
|
Technological changes.
|
•
|
Acquisitions and integration of acquired businesses.
|
•
|
The ability to increase market share and control expenses.
|
•
|
The ability to expand effectively into new markets that we target.
|
•
|
Changes in the competitive environment among bank holding companies.
|
•
|
The effect of changes in laws and regulations (including laws and regulations concerning taxes, banking, securities, and insurance) with which we and our subsidiaries must comply.
|
•
|
The effect of changes in accounting policies and practices and auditing requirements, as may be adopted by the regulatory agencies, as well as the Public Company Accounting Oversight Board, the Financial Accounting Standards Board, and other accounting standard setters.
|
•
|
Changes in our organization, compensation, and benefit plans.
|
•
|
The costs and effects of legal and regulatory developments including the resolution of legal proceedings or regulatory or other governmental inquires and the results of regulatory examinations or reviews.
|
•
|
Greater than expected costs or difficulties related to the integration of new products and lines of business.
|
•
|
Our success at managing the risks described in Item 1A. Risk Factors.
|
|
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||||||||||||||
(Dollars in thousands)
|
|
Average Balance
|
|
Interest Income/Expense
|
|
Yield/Rate
|
|
Average Balance
|
|
Interest Income/Expense
|
|
Yield/Rate
|
|
Average Balance
|
|
Interest Income/Expense
|
|
Yield/Rate
|
|||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Investment securities available-for-sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Taxable
|
|
$
|
728,501
|
|
|
$
|
13,693
|
|
|
1.88
|
%
|
|
$
|
684,503
|
|
|
$
|
11,777
|
|
|
1.72
|
%
|
|
$
|
664,480
|
|
|
$
|
11,929
|
|
|
1.80
|
%
|
Tax-exempt
(1)
|
|
126,378
|
|
|
3,747
|
|
|
2.96
|
%
|
|
127,998
|
|
|
3,981
|
|
|
3.11
|
%
|
|
122,500
|
|
|
4,406
|
|
|
3.60
|
%
|
||||||
Mortgages held for sale
|
|
10,754
|
|
|
429
|
|
|
3.99
|
%
|
|
12,396
|
|
|
467
|
|
|
3.77
|
%
|
|
11,099
|
|
|
439
|
|
|
3.96
|
%
|
||||||
Loans and leases, net of unearned discount
(1)
|
|
4,333,375
|
|
|
194,918
|
|
|
4.50
|
%
|
|
4,113,508
|
|
|
176,116
|
|
|
4.28
|
%
|
|
3,837,149
|
|
|
168,611
|
|
|
4.39
|
%
|
||||||
Other investments
|
|
52,086
|
|
|
1,393
|
|
|
2.67
|
%
|
|
65,517
|
|
|
1,244
|
|
|
1.90
|
%
|
|
33,583
|
|
|
997
|
|
|
2.97
|
%
|
||||||
Total earning assets
(1)
|
|
5,251,094
|
|
|
214,180
|
|
|
4.08
|
%
|
|
5,003,922
|
|
|
193,585
|
|
|
3.87
|
%
|
|
4,668,811
|
|
|
186,382
|
|
|
3.99
|
%
|
||||||
Cash and due from banks
|
|
62,137
|
|
|
|
|
|
|
|
|
60,753
|
|
|
|
|
|
|
|
|
61,400
|
|
|
|
|
|
|
|
||||||
Reserve for loan and lease losses
|
|
(92,187
|
)
|
|
|
|
|
|
|
|
(90,206
|
)
|
|
|
|
|
|
|
|
(87,208
|
)
|
|
|
|
|
|
|
||||||
Other assets
|
|
417,278
|
|
|
|
|
|
|
|
|
386,216
|
|
|
|
|
|
|
|
|
351,205
|
|
|
|
|
|
|
|
||||||
Total assets
|
|
$
|
5,638,322
|
|
|
|
|
|
|
|
|
$
|
5,360,685
|
|
|
|
|
|
|
|
|
$
|
4,994,208
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Interest-bearing deposits
|
|
$
|
3,510,197
|
|
|
$
|
19,202
|
|
|
0.55
|
%
|
|
$
|
3,358,827
|
|
|
$
|
15,267
|
|
|
0.45
|
%
|
|
$
|
3,106,990
|
|
|
$
|
11,489
|
|
|
0.37
|
%
|
Short-term borrowings
|
|
245,235
|
|
|
1,115
|
|
|
0.45
|
%
|
|
210,876
|
|
|
525
|
|
|
0.25
|
%
|
|
236,940
|
|
|
484
|
|
|
0.20
|
%
|
||||||
Subordinated notes
|
|
58,764
|
|
|
4,002
|
|
|
6.81
|
%
|
|
58,764
|
|
|
4,220
|
|
|
7.18
|
%
|
|
58,764
|
|
|
4,220
|
|
|
7.18
|
%
|
||||||
Long-term debt and mandatorily redeemable securities
|
|
74,973
|
|
|
2,435
|
|
|
3.25
|
%
|
|
66,842
|
|
|
2,089
|
|
|
3.13
|
%
|
|
57,245
|
|
|
1,970
|
|
|
3.44
|
%
|
||||||
Total interest-bearing liabilities
|
|
3,889,169
|
|
|
26,754
|
|
|
0.69
|
%
|
|
3,695,309
|
|
|
22,101
|
|
|
0.60
|
%
|
|
3,459,939
|
|
|
18,163
|
|
|
0.52
|
%
|
||||||
Noninterest-bearing deposits
|
|
983,050
|
|
|
|
|
|
|
|
|
943,874
|
|
|
|
|
|
|
|
|
854,070
|
|
|
|
|
|
|
|
||||||
Other liabilities
|
|
63,684
|
|
|
|
|
|
|
|
|
57,799
|
|
|
|
|
|
|
|
|
44,702
|
|
|
|
|
|
|
|
||||||
Shareholders’ equity
|
|
702,419
|
|
|
|
|
|
|
|
|
663,703
|
|
|
|
|
|
|
|
|
635,497
|
|
|
|
|
|
|
|
||||||
Total liabilities and shareholders’ equity
|
|
$
|
5,638,322
|
|
|
|
|
|
|
|
|
$
|
5,360,685
|
|
|
|
|
|
|
|
|
$
|
4,994,208
|
|
|
|
|
|
|
|
|||
Less: Fully tax-equivalent adjustments
|
|
|
|
(1,795
|
)
|
|
|
|
|
|
(1,825
|
)
|
|
|
|
|
|
(1,698
|
)
|
|
|
||||||||||||
Net interest income/margin (GAAP-derived)
(1)
|
|
|
|
|
$
|
185,631
|
|
|
3.54
|
%
|
|
|
|
|
$
|
169,659
|
|
|
3.39
|
%
|
|
|
|
|
$
|
166,521
|
|
|
3.57
|
%
|
|||
Fully tax-equivalent adjustments
|
|
|
|
1,795
|
|
|
|
|
|
|
1,825
|
|
|
|
|
|
|
1,698
|
|
|
|
||||||||||||
Net interest income/margin - FTE
(1)
|
|
|
|
|
$
|
187,426
|
|
|
3.57
|
%
|
|
|
|
|
$
|
171,484
|
|
|
3.43
|
%
|
|
|
|
|
$
|
168,219
|
|
|
3.60
|
%
|
(Dollars in thousands)
|
2017
|
2016
|
2015
|
|||||||
Calculation of Net Interest Margin
|
|
|
|
|||||||
(A)
|
Interest income (GAAP)
|
$
|
212,385
|
|
$
|
191,760
|
|
$
|
184,684
|
|
|
Fully tax-equivalent adjustments:
|
|
|
|
||||||
(B)
|
- Loans and leases
|
621
|
|
584
|
|
284
|
|
|||
(C)
|
- Tax-exempt investment securities
|
1,174
|
|
1,241
|
|
1,414
|
|
|||
(D)
|
Interest income - FTE (A+B+C)
|
214,180
|
|
193,585
|
|
186,382
|
|
|||
(E)
|
Interest expense (GAAP)
|
26,754
|
|
22,101
|
|
18,163
|
|
|||
(F)
|
Net interest income (GAAP) (A-E)
|
185,631
|
|
169,659
|
|
166,521
|
|
|||
(G)
|
Net interest income - FTE (D-E)
|
187,426
|
|
171,484
|
|
168,219
|
|
|||
(H)
|
Total earning assets
|
$
|
5,251,094
|
|
$
|
5,003,922
|
|
$
|
4,668,811
|
|
|
Net interest margin (GAAP-derived) (F/H)
|
3.54
|
%
|
3.39
|
%
|
3.57
|
%
|
|||
|
Net interest margin - FTE (G/H)
|
3.57
|
%
|
3.43
|
%
|
3.60
|
%
|
|
|
Increase (Decrease) due to
|
|
|
||||||||
(Dollars in thousands)
|
|
Volume
|
|
Rate
|
|
Net
|
||||||
2017 compared to 2016
|
|
|
|
|
|
|
|
|
|
|||
Interest earned on:
|
|
|
|
|
|
|
|
|
|
|||
Investment securities available-for-sale:
|
|
|
|
|
|
|
|
|
|
|||
Taxable
|
|
$
|
786
|
|
|
$
|
1,130
|
|
|
$
|
1,916
|
|
Tax-exempt
|
|
(50
|
)
|
|
(184
|
)
|
|
(234
|
)
|
|||
Mortgages held for sale
|
|
(64
|
)
|
|
26
|
|
|
(38
|
)
|
|||
Loans and leases, net of unearned discount
|
|
9,658
|
|
|
9,144
|
|
|
18,802
|
|
|||
Other investments
|
|
(290
|
)
|
|
439
|
|
|
149
|
|
|||
Total earning assets
|
|
$
|
10,040
|
|
|
$
|
10,555
|
|
|
$
|
20,595
|
|
Interest paid on:
|
|
|
|
|
|
|
|
|
|
|||
Interest-bearing deposits
|
|
$
|
713
|
|
|
$
|
3,222
|
|
|
$
|
3,935
|
|
Short-term borrowings
|
|
97
|
|
|
493
|
|
|
590
|
|
|||
Subordinated notes
|
|
—
|
|
|
(218
|
)
|
|
(218
|
)
|
|||
Long-term debt and mandatorily redeemable securities
|
|
262
|
|
|
84
|
|
|
346
|
|
|||
Total interest-bearing liabilities
|
|
$
|
1,072
|
|
|
$
|
3,581
|
|
|
$
|
4,653
|
|
Net interest income - FTE
|
|
$
|
8,968
|
|
|
$
|
6,974
|
|
|
$
|
15,942
|
|
|
|
|
|
|
|
|
||||||
2016 compared to 2015
|
|
|
|
|
|
|
|
|
|
|||
Interest earned on:
|
|
|
|
|
|
|
|
|
|
|||
Investment securities available-for-sale:
|
|
|
|
|
|
|
|
|
|
|||
Taxable
|
|
$
|
353
|
|
|
$
|
(505
|
)
|
|
$
|
(152
|
)
|
Tax-exempt
|
|
191
|
|
|
(616
|
)
|
|
(425
|
)
|
|||
Mortgages held for sale
|
|
50
|
|
|
(22
|
)
|
|
28
|
|
|||
Loans and leases, net of unearned discount
|
|
11,914
|
|
|
(4,409
|
)
|
|
7,505
|
|
|||
Other investments
|
|
700
|
|
|
(453
|
)
|
|
247
|
|
|||
Total earning assets
|
|
$
|
13,208
|
|
|
$
|
(6,005
|
)
|
|
$
|
7,203
|
|
Interest paid on:
|
|
|
|
|
|
|
|
|
|
|||
Interest-bearing deposits
|
|
$
|
987
|
|
|
$
|
2,791
|
|
|
$
|
3,778
|
|
Short-term borrowings
|
|
(57
|
)
|
|
98
|
|
|
41
|
|
|||
Subordinated notes
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Long-term debt and mandatorily redeemable securities
|
|
311
|
|
|
(192
|
)
|
|
119
|
|
|||
Total interest-bearing liabilities
|
|
$
|
1,241
|
|
|
$
|
2,697
|
|
|
$
|
3,938
|
|
Net interest income - FTE
|
|
$
|
11,967
|
|
|
$
|
(8,702
|
)
|
|
$
|
3,265
|
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Noninterest income:
|
|
|
|
|
|
|
|
|
|
|||
Trust and wealth advisory
|
|
$
|
20,980
|
|
|
$
|
19,256
|
|
|
$
|
19,126
|
|
Service charges on deposit accounts
|
|
9,564
|
|
|
9,053
|
|
|
9,313
|
|
|||
Debit card
|
|
11,809
|
|
|
10,887
|
|
|
10,217
|
|
|||
Mortgage banking
|
|
4,796
|
|
|
4,496
|
|
|
4,570
|
|
|||
Insurance commissions
|
|
5,889
|
|
|
5,513
|
|
|
5,465
|
|
|||
Equipment rental
|
|
30,381
|
|
|
25,863
|
|
|
22,302
|
|
|||
Gains on investment securities available-for-sale
|
|
4,340
|
|
|
1,796
|
|
|
4
|
|
|||
Other
|
|
10,947
|
|
|
12,081
|
|
|
12,319
|
|
|||
Total noninterest income
|
|
$
|
98,706
|
|
|
$
|
88,945
|
|
|
$
|
83,316
|
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Noninterest expense:
|
|
|
|
|
|
|
|
|
|
|||
Salaries and employee benefits
|
|
$
|
86,912
|
|
|
$
|
86,837
|
|
|
$
|
86,133
|
|
Net occupancy
|
|
10,624
|
|
|
9,686
|
|
|
9,768
|
|
|||
Furniture and equipment
|
|
20,769
|
|
|
19,500
|
|
|
18,348
|
|
|||
Depreciation — leased equipment
|
|
25,215
|
|
|
21,678
|
|
|
18,280
|
|
|||
Professional fees
|
|
6,810
|
|
|
5,161
|
|
|
4,682
|
|
|||
Supplies and communications
|
|
5,355
|
|
|
5,244
|
|
|
6,011
|
|
|||
FDIC and other insurance
|
|
2,537
|
|
|
3,147
|
|
|
3,412
|
|
|||
Business development and marketing
|
|
7,477
|
|
|
4,936
|
|
|
4,837
|
|
|||
Loan and lease collection and repossession
|
|
2,724
|
|
|
1,600
|
|
|
667
|
|
|||
Other
|
|
5,574
|
|
|
5,856
|
|
|
6,976
|
|
|||
Total noninterest expense
|
|
$
|
173,997
|
|
|
$
|
163,645
|
|
|
$
|
159,114
|
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
Commercial and agricultural
|
|
$
|
929,997
|
|
|
$
|
812,264
|
|
|
$
|
744,749
|
|
|
$
|
710,758
|
|
|
$
|
679,492
|
|
Auto and light truck
|
|
496,816
|
|
|
411,764
|
|
|
425,236
|
|
|
397,902
|
|
|
391,649
|
|
|||||
Medium and heavy duty truck
|
|
296,935
|
|
|
294,790
|
|
|
278,254
|
|
|
247,153
|
|
|
237,854
|
|
|||||
Aircraft
|
|
844,657
|
|
|
802,414
|
|
|
778,012
|
|
|
727,665
|
|
|
738,133
|
|
|||||
Construction equipment
|
|
563,437
|
|
|
495,925
|
|
|
455,565
|
|
|
399,940
|
|
|
333,088
|
|
|||||
Commercial real estate
|
|
741,568
|
|
|
719,170
|
|
|
700,268
|
|
|
616,587
|
|
|
583,997
|
|
|||||
Residential real estate and home equity
|
|
526,122
|
|
|
521,931
|
|
|
490,468
|
|
|
476,504
|
|
|
495,273
|
|
|||||
Consumer
|
|
128,146
|
|
|
129,813
|
|
|
122,140
|
|
|
112,065
|
|
|
89,838
|
|
|||||
Total loans and leases
|
|
$
|
4,527,678
|
|
|
$
|
4,188,071
|
|
|
$
|
3,994,692
|
|
|
$
|
3,688,574
|
|
|
$
|
3,549,324
|
|
(Dollars in thousands)
|
|
0-1 Year
|
|
1-5 Years
|
|
Over 5 Years
|
|
Total
|
||||||||
Commercial and agricultural
|
|
$
|
455,843
|
|
|
$
|
362,247
|
|
|
$
|
111,907
|
|
|
$
|
929,997
|
|
Auto and light truck
|
|
184,292
|
|
|
291,130
|
|
|
21,394
|
|
|
496,816
|
|
||||
Medium and heavy duty truck
|
|
102,308
|
|
|
191,501
|
|
|
3,126
|
|
|
296,935
|
|
||||
Aircraft
|
|
186,171
|
|
|
561,101
|
|
|
97,385
|
|
|
844,657
|
|
||||
Construction equipment
|
|
177,803
|
|
|
359,082
|
|
|
26,552
|
|
|
563,437
|
|
||||
Total
|
|
$
|
1,106,417
|
|
|
$
|
1,765,061
|
|
|
$
|
260,364
|
|
|
$
|
3,131,842
|
|
Rate Sensitivity
(Dollars in thousands)
|
|
Fixed Rate
|
|
Variable Rate
|
|
Total
|
||||||
1 – 5 Years
|
|
$
|
1,200,586
|
|
|
$
|
564,475
|
|
|
$
|
1,765,061
|
|
Over 5 Years
|
|
77,332
|
|
|
183,032
|
|
|
260,364
|
|
|||
Total
|
|
$
|
1,277,918
|
|
|
$
|
747,507
|
|
|
$
|
2,025,425
|
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
Amounts of loans and leases outstanding at end of period
|
|
$
|
4,527,678
|
|
|
$
|
4,188,071
|
|
|
$
|
3,994,692
|
|
|
$
|
3,688,574
|
|
|
$
|
3,549,324
|
|
Average amount of net loans and leases outstanding during period
|
|
$
|
4,333,375
|
|
|
$
|
4,113,508
|
|
|
$
|
3,837,149
|
|
|
$
|
3,639,985
|
|
|
$
|
3,433,938
|
|
Balance of reserve for loan and lease losses at beginning of period
|
|
$
|
88,543
|
|
|
$
|
88,112
|
|
|
$
|
85,068
|
|
|
$
|
83,505
|
|
|
$
|
83,311
|
|
Charge-offs:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Commercial and agricultural
|
|
2,415
|
|
|
547
|
|
|
3,489
|
|
|
5,007
|
|
|
538
|
|
|||||
Auto and light truck
|
|
774
|
|
|
4
|
|
|
24
|
|
|
42
|
|
|
226
|
|
|||||
Medium and heavy duty truck
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
57
|
|
|||||
Aircraft
|
|
1,872
|
|
|
6,123
|
|
|
244
|
|
|
—
|
|
|
1,308
|
|
|||||
Construction equipment
|
|
164
|
|
|
128
|
|
|
—
|
|
|
4
|
|
|
88
|
|
|||||
Commercial real estate
|
|
344
|
|
|
32
|
|
|
—
|
|
|
99
|
|
|
170
|
|
|||||
Residential real estate and home equity
|
|
124
|
|
|
219
|
|
|
295
|
|
|
46
|
|
|
424
|
|
|||||
Consumer
|
|
836
|
|
|
888
|
|
|
658
|
|
|
833
|
|
|
1,017
|
|
|||||
Total charge-offs
|
|
6,529
|
|
|
7,941
|
|
|
4,710
|
|
|
6,031
|
|
|
3,828
|
|
|||||
Recoveries:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Commercial and agricultural
|
|
984
|
|
|
509
|
|
|
851
|
|
|
929
|
|
|
468
|
|
|||||
Auto and light truck
|
|
1,153
|
|
|
253
|
|
|
380
|
|
|
1,283
|
|
|
139
|
|
|||||
Medium and heavy duty truck
|
|
—
|
|
|
10
|
|
|
28
|
|
|
142
|
|
|
462
|
|
|||||
Aircraft
|
|
227
|
|
|
528
|
|
|
802
|
|
|
240
|
|
|
884
|
|
|||||
Construction equipment
|
|
298
|
|
|
461
|
|
|
434
|
|
|
525
|
|
|
323
|
|
|||||
Commercial real estate
|
|
851
|
|
|
469
|
|
|
2,807
|
|
|
347
|
|
|
627
|
|
|||||
Residential real estate and home equity
|
|
109
|
|
|
31
|
|
|
34
|
|
|
111
|
|
|
22
|
|
|||||
Consumer
|
|
267
|
|
|
278
|
|
|
258
|
|
|
284
|
|
|
325
|
|
|||||
Total recoveries
|
|
3,889
|
|
|
2,539
|
|
|
5,594
|
|
|
3,861
|
|
|
3,250
|
|
|||||
Net charge-offs (recoveries)
|
|
2,640
|
|
|
5,402
|
|
|
(884
|
)
|
|
2,170
|
|
|
578
|
|
|||||
Provision for loan and lease losses
|
|
8,980
|
|
|
5,833
|
|
|
2,160
|
|
|
3,733
|
|
|
772
|
|
|||||
Balance at end of period
|
|
$
|
94,883
|
|
|
$
|
88,543
|
|
|
$
|
88,112
|
|
|
$
|
85,068
|
|
|
$
|
83,505
|
|
Ratio of net charge-offs (recoveries) to average net loans and leases outstanding
|
|
0.06
|
%
|
|
0.13
|
%
|
|
(0.02
|
)%
|
|
0.06
|
%
|
|
0.02
|
%
|
|||||
Ratio of reserve for loan and lease losses to net loans and leases outstanding end of period
|
|
2.10
|
%
|
|
2.11
|
%
|
|
2.21
|
%
|
|
2.31
|
%
|
|
2.35
|
%
|
|||||
Coverage ratio of reserve for loan and lease losses to nonperforming loans and leases
|
|
477.66
|
%
|
|
435.68
|
%
|
|
686.23
|
%
|
|
239.07
|
%
|
|
225.73
|
%
|
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|||||
Commercial and agricultural
|
|
0.16
|
%
|
|
—
|
%
|
|
0.36
|
%
|
|
0.58
|
%
|
|
0.01
|
%
|
Auto and light truck
|
|
(0.08
|
)
|
|
(0.06
|
)
|
|
(0.08
|
)
|
|
(0.30
|
)
|
|
0.02
|
|
Medium and heavy duty truck
|
|
—
|
|
|
—
|
|
|
(0.01
|
)
|
|
(0.06
|
)
|
|
(0.19
|
)
|
Aircraft
|
|
0.21
|
|
|
0.69
|
|
|
(0.07
|
)
|
|
(0.03
|
)
|
|
0.06
|
|
Construction equipment
|
|
(0.03
|
)
|
|
(0.07
|
)
|
|
(0.10
|
)
|
|
(0.14
|
)
|
|
(0.08
|
)
|
Commercial real estate
|
|
(0.07
|
)
|
|
(0.06
|
)
|
|
(0.44
|
)
|
|
(0.04
|
)
|
|
(0.08
|
)
|
Residential real estate and home equity
|
|
—
|
|
|
0.04
|
|
|
0.05
|
|
|
(0.01
|
)
|
|
0.08
|
|
Consumer
|
|
0.44
|
|
|
0.49
|
|
|
0.33
|
|
|
0.56
|
|
|
0.82
|
|
Total net charge-offs (recoveries) to average portfolio loans and leases
|
|
0.06
|
%
|
|
0.13
|
%
|
|
(0.02
|
)%
|
|
0.06
|
%
|
|
0.02
|
%
|
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|||||||||||||||||||||||||
(Dollars in thousands)
|
|
Reserve Amount
|
|
Percentage of Loans and Leases in Each Category to Total Loans and Leases
|
|
Reserve Amount
|
|
Percentage of Loans and Leases in Each Category to Total Loans and Leases
|
|
Reserve Amount
|
|
Percentage of Loans and Leases in Each Category to Total Loans and Leases
|
|
Reserve Amount
|
|
Percentage of Loans and Leases in Each Category to Total Loans and Leases
|
|
Reserve Amount
|
|
Percentage of Loans and Leases in Each Category to Total Loans and Leases
|
|||||||||||||||
Commercial and agricultural
|
|
$
|
16,228
|
|
|
20.54
|
%
|
|
$
|
14,668
|
|
|
19.40
|
%
|
|
$
|
15,456
|
|
|
18.64
|
%
|
|
$
|
11,760
|
|
|
19.27
|
%
|
|
$
|
11,515
|
|
|
19.14
|
%
|
Auto and light truck
|
|
10,103
|
|
|
10.97
|
|
|
8,064
|
|
|
9.83
|
|
|
9,269
|
|
|
10.64
|
|
|
10,326
|
|
|
10.79
|
|
|
9,657
|
|
|
11.04
|
|
|||||
Medium and heavy duty truck
|
|
4,844
|
|
|
6.56
|
|
|
4,740
|
|
|
7.04
|
|
|
4,699
|
|
|
6.97
|
|
|
4,500
|
|
|
6.70
|
|
|
4,212
|
|
|
6.70
|
|
|||||
Aircraft
|
|
34,619
|
|
|
18.66
|
|
|
34,352
|
|
|
19.16
|
|
|
32,373
|
|
|
19.48
|
|
|
32,234
|
|
|
19.73
|
|
|
34,037
|
|
|
20.80
|
|
|||||
Construction equipment
|
|
9,343
|
|
|
12.44
|
|
|
8,207
|
|
|
11.84
|
|
|
7,592
|
|
|
11.40
|
|
|
7,008
|
|
|
10.84
|
|
|
5,972
|
|
|
9.38
|
|
|||||
Commercial real estate
|
|
14,792
|
|
|
16.38
|
|
|
13,677
|
|
|
17.17
|
|
|
13,762
|
|
|
17.53
|
|
|
13,270
|
|
|
16.72
|
|
|
12,406
|
|
|
16.45
|
|
|||||
Residential real estate and home equity
|
|
3,666
|
|
|
11.62
|
|
|
3,550
|
|
|
12.46
|
|
|
3,662
|
|
|
12.28
|
|
|
4,504
|
|
|
12.91
|
|
|
4,539
|
|
|
13.96
|
|
|||||
Consumer
|
|
1,288
|
|
|
2.83
|
|
|
1,285
|
|
|
3.10
|
|
|
1,299
|
|
|
3.06
|
|
|
1,466
|
|
|
3.04
|
|
|
1,167
|
|
|
2.53
|
|
|||||
Total
|
|
$
|
94,883
|
|
|
100.00
|
%
|
|
$
|
88,543
|
|
|
100.00
|
%
|
|
$
|
88,112
|
|
|
100.00
|
%
|
|
$
|
85,068
|
|
|
100.00
|
%
|
|
$
|
83,505
|
|
|
100.00
|
%
|
Nonperforming assets at December 31
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
Loans past due over 90 days
|
|
$
|
459
|
|
|
$
|
416
|
|
|
$
|
122
|
|
|
$
|
981
|
|
|
$
|
287
|
|
Nonaccrual loans and leases:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Commercial and agricultural
|
|
2,603
|
|
|
3,981
|
|
|
4,283
|
|
|
14,284
|
|
|
11,765
|
|
|||||
Auto and light truck
|
|
8,041
|
|
|
166
|
|
|
46
|
|
|
38
|
|
|
3,511
|
|
|||||
Medium and heavy duty truck
|
|
371
|
|
|
—
|
|
|
—
|
|
|
56
|
|
|
188
|
|
|||||
Aircraft
|
|
1,957
|
|
|
6,110
|
|
|
4,388
|
|
|
12,473
|
|
|
10,365
|
|
|||||
Construction equipment
|
|
991
|
|
|
1,248
|
|
|
539
|
|
|
751
|
|
|
1,032
|
|
|||||
Commercial real estate
|
|
3,418
|
|
|
5,555
|
|
|
1,392
|
|
|
4,807
|
|
|
7,064
|
|
|||||
Residential real estate and home equity
|
|
1,890
|
|
|
2,641
|
|
|
1,961
|
|
|
2,094
|
|
|
2,691
|
|
|||||
Consumer
|
|
134
|
|
|
206
|
|
|
109
|
|
|
99
|
|
|
91
|
|
|||||
Total nonaccrual loans and leases
|
|
19,405
|
|
|
19,907
|
|
|
12,718
|
|
|
34,602
|
|
|
36,707
|
|
|||||
Total nonperforming loans and leases
|
|
19,864
|
|
|
20,323
|
|
|
12,840
|
|
|
35,583
|
|
|
36,994
|
|
|||||
Other real estate
|
|
1,312
|
|
|
704
|
|
|
736
|
|
|
1,109
|
|
|
4,539
|
|
|||||
Former bank premises held for sale
|
|
—
|
|
|
—
|
|
|
—
|
|
|
626
|
|
|
951
|
|
|||||
Repossessions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Commercial and agricultural
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
23
|
|
|||||
Auto and light truck
|
|
165
|
|
|
32
|
|
|
10
|
|
|
25
|
|
|
145
|
|
|||||
Medium and heavy duty truck
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Aircraft
|
|
9,335
|
|
|
9,335
|
|
|
6,916
|
|
|
5,123
|
|
|
4,082
|
|
|||||
Construction equipment
|
|
582
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Consumer
|
|
32
|
|
|
6
|
|
|
1
|
|
|
8
|
|
|
12
|
|
|||||
Total repossessions
|
|
10,114
|
|
|
9,373
|
|
|
6,927
|
|
|
5,156
|
|
|
4,262
|
|
|||||
Operating leases
|
|
9
|
|
|
34
|
|
|
121
|
|
|
6
|
|
|
—
|
|
|||||
Total nonperforming assets
|
|
$
|
31,299
|
|
|
$
|
30,434
|
|
|
$
|
20,624
|
|
|
$
|
42,480
|
|
|
$
|
46,746
|
|
Nonperforming loans and leases to loans and leases, net of unearned discount
|
|
0.44
|
%
|
|
0.49
|
%
|
|
0.32
|
%
|
|
0.96
|
%
|
|
1.04
|
%
|
|||||
Nonperforming assets to loans and leases and operating leases, net of unearned discount
|
|
0.67
|
%
|
|
0.70
|
%
|
|
0.50
|
%
|
|
1.13
|
%
|
|
1.29
|
%
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
||||||
U.S. Treasury and Federal agencies securities
|
|
$
|
471,508
|
|
|
$
|
424,495
|
|
|
$
|
389,457
|
|
U.S. States and political subdivisions securities
|
|
116,260
|
|
|
133,509
|
|
|
120,441
|
|
|||
Mortgage-backed securities — Federal agencies
|
|
289,327
|
|
|
252,981
|
|
|
234,400
|
|
|||
Corporate debt securities
|
|
31,573
|
|
|
35,266
|
|
|
34,241
|
|
|||
Foreign government and other securities
|
|
700
|
|
|
800
|
|
|
800
|
|
|||
Marketable equity securities
|
|
—
|
|
|
1,265
|
|
|
1,893
|
|
|||
Total investment securities available-for-sale
|
|
$
|
909,368
|
|
|
$
|
848,316
|
|
|
$
|
781,232
|
|
(Dollars in thousands)
|
|
Amount
|
|
Yield
|
|||
U.S. Treasury and Federal agencies securities
|
|
|
|
|
|
|
|
Under 1 year
|
|
$
|
70,001
|
|
|
1.68
|
%
|
1 – 5 years
|
|
396,508
|
|
|
1.89
|
|
|
5 – 10 years
|
|
4,999
|
|
|
2.25
|
|
|
Over 10 years
|
|
—
|
|
|
—
|
|
|
Total U.S. Treasury and Federal agencies securities
|
|
471,508
|
|
|
1.86
|
|
|
U.S. States and political subdivisions securities
|
|
|
|
|
|
|
|
Under 1 year
|
|
17,488
|
|
|
4.04
|
|
|
1 – 5 years
|
|
71,921
|
|
|
2.94
|
|
|
5 – 10 years
|
|
26,851
|
|
|
2.79
|
|
|
Over 10 years
|
|
—
|
|
|
—
|
|
|
Total U.S. States and political subdivisions securities
|
|
116,260
|
|
|
3.07
|
|
|
Corporate debt securities
|
|
|
|
|
|
|
|
Under 1 year
|
|
7,240
|
|
|
1.69
|
|
|
1 – 5 years
|
|
24,333
|
|
|
1.74
|
|
|
5 – 10 years
|
|
—
|
|
|
—
|
|
|
Over 10 years
|
|
—
|
|
|
—
|
|
|
Total Corporate debt securities
|
|
31,573
|
|
|
1.72
|
|
|
Foreign government and other securities
|
|
|
|
|
|
|
|
Under 1 year
|
|
200
|
|
|
1.86
|
|
|
1 – 5 years
|
|
500
|
|
|
2.22
|
|
|
5 – 10 years
|
|
—
|
|
|
—
|
|
|
Over 10 years
|
|
—
|
|
|
—
|
|
|
Total Foreign government and other securities
|
|
700
|
|
|
2.12
|
|
|
Mortgage-backed securities — Federal agencies
|
|
289,327
|
|
|
2.44
|
|
|
Total investment securities available-for-sale
|
|
$
|
909,368
|
|
|
2.20
|
%
|
|
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||
(Dollars in thousands)
|
|
Amount
|
|
Rate
|
|
Amount
|
|
Rate
|
|
Amount
|
|
Rate
|
|||||||||
Noninterest bearing demand
|
|
$
|
983,050
|
|
|
—
|
%
|
|
$
|
943,874
|
|
|
—
|
%
|
|
$
|
854,070
|
|
|
—
|
%
|
Interest bearing demand
|
|
1,517,859
|
|
|
0.31
|
|
|
1,395,195
|
|
|
0.17
|
|
|
1,334,850
|
|
|
0.12
|
|
|||
Savings
|
|
828,993
|
|
|
0.09
|
|
|
786,983
|
|
|
0.08
|
|
|
733,848
|
|
|
0.08
|
|
|||
Time
|
|
1,163,345
|
|
|
1.18
|
|
|
1,176,649
|
|
|
1.04
|
|
|
1,038,292
|
|
|
0.89
|
|
|||
Total deposits
|
|
$
|
4,493,247
|
|
|
|
|
$
|
4,302,701
|
|
|
|
|
$
|
3,961,060
|
|
|
|
(Dollars in thousands)
|
|
Federal Funds Purchased and Securities Repurchase Agreements
|
|
Commercial Paper
|
|
Other
Short-Term Borrowings
|
|
Total Borrowings
|
||||||||
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Balance at December 31, 2017
|
|
$
|
205,834
|
|
|
$
|
6,115
|
|
|
$
|
2,646
|
|
|
$
|
214,595
|
|
Maximum amount outstanding at any month-end
|
|
205,834
|
|
|
6,542
|
|
|
162,402
|
|
|
374,778
|
|
||||
Average amount outstanding
|
|
166,114
|
|
|
6,327
|
|
|
72,794
|
|
|
245,235
|
|
||||
Weighted average interest rate during the year
|
|
0.21
|
%
|
|
0.27
|
%
|
|
1.02
|
%
|
|
0.45
|
%
|
||||
Weighted average interest rate for outstanding amounts at December 31, 2017
|
|
0.59
|
%
|
|
0.27
|
%
|
|
—
|
%
|
|
0.57
|
%
|
||||
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Balance at December 31, 2016
|
|
$
|
162,913
|
|
|
$
|
5,761
|
|
|
$
|
123,269
|
|
|
$
|
291,943
|
|
Maximum amount outstanding at any month-end
|
|
187,239
|
|
|
8,640
|
|
|
130,822
|
|
|
326,701
|
|
||||
Average amount outstanding
|
|
171,316
|
|
|
6,929
|
|
|
32,631
|
|
|
210,876
|
|
||||
Weighted average interest rate during the year
|
|
0.21
|
%
|
|
0.27
|
%
|
|
0.45
|
%
|
|
0.25
|
%
|
||||
Weighted average interest rate for outstanding amounts at December 31, 2016
|
|
0.17
|
%
|
|
0.27
|
%
|
|
0.57
|
%
|
|
0.34
|
%
|
||||
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Balance at December 31, 2015
|
|
$
|
130,662
|
|
|
$
|
7,295
|
|
|
$
|
95,272
|
|
|
$
|
233,229
|
|
Maximum amount outstanding at any month-end
|
|
179,600
|
|
|
14,135
|
|
|
149,783
|
|
|
343,518
|
|
||||
Average amount outstanding
|
|
145,084
|
|
|
10,722
|
|
|
81,134
|
|
|
236,940
|
|
||||
Weighted average interest rate during the year
|
|
0.16
|
%
|
|
0.27
|
%
|
|
0.28
|
%
|
|
0.20
|
%
|
||||
Weighted average interest rate for outstanding amounts at December 31, 2015
|
|
0.29
|
%
|
|
0.28
|
%
|
|
0.38
|
%
|
|
0.33
|
%
|
(i)
|
Available Liquidity (sum of short term borrowing capacity) greater than $500 million;
|
(ii)
|
Liquidity Ratio (total of net cash, short term investments and unpledged marketable assets divided by the sum of net deposits and short term liabilities) greater than 15%;
|
(iii)
|
Dependency Ratio (net potentially volatile liabilities minus short term investments divided by total earning assets minus short term investments) less than 15%; and
|
(iv)
|
Loans to Deposits Ratio less than 100%
|
|
|
Percentage Change in Net Interest Income
|
||||||
|
|
December 31, 2017
|
|
December 31, 2016
|
||||
Basis Point Interest Rate Change
|
|
12 Months
|
|
24 Months
|
|
12 Months
|
|
24 Months
|
Up 200
|
|
3.90%
|
|
7.83%
|
|
3.74%
|
|
9.67%
|
Up 100
|
|
1.93%
|
|
3.82%
|
|
1.61%
|
|
4.47%
|
Down 100
|
|
(6.45)%
|
|
(9.87)%
|
|
(3.84)%
|
|
(8.04)%
|
(Dollars in thousands)
|
|
Note
|
|
0 – 1 Year
|
|
1 – 3 Years
|
|
3 – 5 Years
|
|
Over 5 Years
|
|
Indeterminate maturity
|
|
Total
|
||||||||||||
Deposits without stated maturity
|
|
—
|
|
$
|
3,482,757
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,482,757
|
|
Certificates of deposit
|
|
10
|
|
612,866
|
|
|
591,639
|
|
|
62,141
|
|
|
3,327
|
|
|
—
|
|
|
1,269,973
|
|
||||||
Long-term debt
|
|
11
|
|
1,634
|
|
|
2,985
|
|
|
5,118
|
|
|
41,375
|
|
|
18,948
|
|
|
70,060
|
|
||||||
Subordinated notes
|
|
12
|
|
—
|
|
|
—
|
|
|
—
|
|
|
58,764
|
|
|
—
|
|
|
58,764
|
|
||||||
Operating leases
|
|
18
|
|
3,297
|
|
|
5,814
|
|
|
2,025
|
|
|
1,862
|
|
|
—
|
|
|
12,998
|
|
||||||
Purchase obligations
|
|
—
|
|
27,156
|
|
|
7,143
|
|
|
898
|
|
|
55
|
|
|
—
|
|
|
35,252
|
|
||||||
Total contractual obligations
|
|
|
|
$
|
4,127,710
|
|
|
$
|
607,581
|
|
|
$
|
70,182
|
|
|
$
|
105,383
|
|
|
$
|
18,948
|
|
|
$
|
4,929,804
|
|
Three Months Ended
(Dollars in thousands, except per share amounts)
|
|
March 31
|
|
June 30
|
|
September 30
|
|
December 31
|
||||||||
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest income
|
|
$
|
49,372
|
|
|
$
|
52,398
|
|
|
$
|
54,430
|
|
|
$
|
56,185
|
|
Interest expense
|
|
5,645
|
|
|
6,537
|
|
|
7,201
|
|
|
7,371
|
|
||||
Net interest income
|
|
43,727
|
|
|
45,861
|
|
|
47,229
|
|
|
48,814
|
|
||||
Provision for loan and lease losses
|
|
1,000
|
|
|
2,738
|
|
|
1,620
|
|
|
3,622
|
|
||||
Gains on investment securities available-for-sale
|
|
1,285
|
|
|
465
|
|
|
1,007
|
|
|
1,583
|
|
||||
Income before income taxes
|
|
24,915
|
|
|
26,154
|
|
|
26,741
|
|
|
23,550
|
|
||||
Net income
|
|
16,206
|
|
|
16,669
|
|
|
17,182
|
|
|
17,994
|
|
||||
Diluted net income per common share
|
|
0.62
|
|
|
0.64
|
|
|
0.66
|
|
|
0.69
|
|
||||
2016
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Interest income
|
|
$
|
46,799
|
|
|
$
|
47,937
|
|
|
$
|
48,300
|
|
|
$
|
48,724
|
|
Interest expense
|
|
5,510
|
|
|
5,644
|
|
|
5,606
|
|
|
5,341
|
|
||||
Net interest income
|
|
41,289
|
|
|
42,293
|
|
|
42,694
|
|
|
43,383
|
|
||||
Provision for loan and lease losses
|
|
975
|
|
|
2,049
|
|
|
2,067
|
|
|
742
|
|
||||
Gains (losses) on investment securities available-for-sale
|
|
10
|
|
|
(209
|
)
|
|
989
|
|
|
1,006
|
|
||||
Income before income taxes
|
|
21,236
|
|
|
22,507
|
|
|
22,147
|
|
|
23,236
|
|
||||
Net income
|
|
13,818
|
|
|
14,479
|
|
|
14,264
|
|
|
15,225
|
|
||||
Diluted net income per common share
|
|
0.53
|
|
|
0.56
|
|
|
0.55
|
|
|
0.58
|
|
/s/ BKD, LLP
|
|
|
|
We have served as the Company's auditor since 2015
|
|
|
|
Fort Wayne, Indiana
|
|
February 16, 2018
|
|
/s/ BKD, LLP
|
|
|
|
|
|
Fort Wayne, Indiana
|
|
February 16, 2018
|
|
December 31
(Dollars in thousands)
|
|
2017
|
|
2016
|
||||
ASSETS
|
|
|
|
|
|
|
||
Cash and due from banks
|
|
$
|
73,635
|
|
|
$
|
58,578
|
|
Federal funds sold and interest bearing deposits with other banks
|
|
4,398
|
|
|
49,726
|
|
||
Investment securities available-for-sale
|
|
904,033
|
|
|
850,467
|
|
||
Other investments
|
|
25,953
|
|
|
22,458
|
|
||
Mortgages held for sale
|
|
13,123
|
|
|
15,849
|
|
||
Loans and leases, net of unearned discount:
|
|
|
|
|
|
|
||
Commercial and agricultural
|
|
929,997
|
|
|
812,264
|
|
||
Auto and light truck
|
|
496,816
|
|
|
411,764
|
|
||
Medium and heavy duty truck
|
|
296,935
|
|
|
294,790
|
|
||
Aircraft
|
|
844,657
|
|
|
802,414
|
|
||
Construction equipment
|
|
563,437
|
|
|
495,925
|
|
||
Commercial real estate
|
|
741,568
|
|
|
719,170
|
|
||
Residential real estate and home equity
|
|
526,122
|
|
|
521,931
|
|
||
Consumer
|
|
128,146
|
|
|
129,813
|
|
||
Total loans and leases
|
|
4,527,678
|
|
|
4,188,071
|
|
||
Reserve for loan and lease losses
|
|
(94,883
|
)
|
|
(88,543
|
)
|
||
Net loans and leases
|
|
4,432,795
|
|
|
4,099,528
|
|
||
Equipment owned under operating leases, net
|
|
139,581
|
|
|
118,793
|
|
||
Net premises and equipment
|
|
54,612
|
|
|
56,708
|
|
||
Goodwill and intangible assets
|
|
83,742
|
|
|
84,102
|
|
||
Accrued income and other assets
|
|
155,412
|
|
|
130,059
|
|
||
Total assets
|
|
$
|
5,887,284
|
|
|
$
|
5,486,268
|
|
|
|
|
|
|
||||
LIABILITIES
|
|
|
|
|
|
|
||
Deposits:
|
|
|
|
|
|
|
||
Noninterest-bearing demand
|
|
$
|
1,064,271
|
|
|
$
|
991,256
|
|
Interest-bearing deposits:
|
|
|
|
|
||||
Interest-bearing demand
|
|
1,554,898
|
|
|
1,471,526
|
|
||
Savings
|
|
863,588
|
|
|
814,326
|
|
||
Time
|
|
1,269,973
|
|
|
1,056,652
|
|
||
Total interest-bearing deposits
|
|
3,688,459
|
|
|
3,342,504
|
|
||
Total deposits
|
|
4,752,730
|
|
|
4,333,760
|
|
||
Short-term borrowings:
|
|
|
|
|
|
|
||
Federal funds purchased and securities sold under agreements to repurchase
|
|
205,834
|
|
|
162,913
|
|
||
Other short-term borrowings
|
|
8,761
|
|
|
129,030
|
|
||
Total short-term borrowings
|
|
214,595
|
|
|
291,943
|
|
||
Long-term debt and mandatorily redeemable securities
|
|
70,060
|
|
|
74,308
|
|
||
Subordinated notes
|
|
58,764
|
|
|
58,764
|
|
||
Accrued expenses and other liabilities
|
|
72,598
|
|
|
54,843
|
|
||
Total liabilities
|
|
5,168,747
|
|
|
4,813,618
|
|
||
|
|
|
|
|
||||
SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
||
Preferred stock; no par value
Authorized 10,000,000 shares; none issued or outstanding
|
|
—
|
|
|
—
|
|
||
Common Stock; no par value
Authorized 40,000,000 shares; issued 28,205,674 shares at December 31, 2017 and 2016
|
|
436,538
|
|
|
436,538
|
|
||
Retained earnings
|
|
339,959
|
|
|
290,824
|
|
||
Cost of common stock in treasury (2,268,910 shares at December 31, 2017 and 2,329,909 shares at December 31, 2016)
|
|
(54,628
|
)
|
|
(56,056
|
)
|
||
Accumulated other comprehensive (loss) income
|
|
(3,332
|
)
|
|
1,344
|
|
||
Total shareholders’ equity
|
|
718,537
|
|
|
672,650
|
|
||
Total liabilities and shareholders’ equity
|
|
$
|
5,887,284
|
|
|
$
|
5,486,268
|
|
Year Ended December 31
(Dollars in thousands, except per share amounts)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Interest income:
|
|
|
|
|
|
|
|
|
|
|||
Loans and leases
|
|
$
|
194,726
|
|
|
$
|
175,999
|
|
|
$
|
168,766
|
|
Investment securities, taxable
|
|
13,693
|
|
|
11,777
|
|
|
11,929
|
|
|||
Investment securities, tax-exempt
|
|
2,573
|
|
|
2,740
|
|
|
2,992
|
|
|||
Other
|
|
1,393
|
|
|
1,244
|
|
|
997
|
|
|||
Total interest income
|
|
212,385
|
|
|
191,760
|
|
|
184,684
|
|
|||
Interest expense:
|
|
|
|
|
|
|
|
|
|
|||
Deposits
|
|
19,202
|
|
|
15,267
|
|
|
11,489
|
|
|||
Short-term borrowings
|
|
1,115
|
|
|
525
|
|
|
484
|
|
|||
Subordinated notes
|
|
4,002
|
|
|
4,220
|
|
|
4,220
|
|
|||
Long-term debt and mandatorily redeemable securities
|
|
2,435
|
|
|
2,089
|
|
|
1,970
|
|
|||
Total interest expense
|
|
26,754
|
|
|
22,101
|
|
|
18,163
|
|
|||
Net interest income
|
|
185,631
|
|
|
169,659
|
|
|
166,521
|
|
|||
Provision for loan and lease losses
|
|
8,980
|
|
|
5,833
|
|
|
2,160
|
|
|||
Net interest income after provision for loan and lease losses
|
|
176,651
|
|
|
163,826
|
|
|
164,361
|
|
|||
Noninterest income:
|
|
|
|
|
|
|
|
|
|
|||
Trust and wealth advisory
|
|
20,980
|
|
|
19,256
|
|
|
19,126
|
|
|||
Service charges on deposit accounts
|
|
9,564
|
|
|
9,053
|
|
|
9,313
|
|
|||
Debit card
|
|
11,809
|
|
|
10,887
|
|
|
10,217
|
|
|||
Mortgage banking
|
|
4,796
|
|
|
4,496
|
|
|
4,570
|
|
|||
Insurance commissions
|
|
5,889
|
|
|
5,513
|
|
|
5,465
|
|
|||
Equipment rental
|
|
30,381
|
|
|
25,863
|
|
|
22,302
|
|
|||
Gains on investment securities available-for-sale
|
|
4,340
|
|
|
1,796
|
|
|
4
|
|
|||
Other
|
|
10,947
|
|
|
12,081
|
|
|
12,319
|
|
|||
Total noninterest income
|
|
98,706
|
|
|
88,945
|
|
|
83,316
|
|
|||
Noninterest expense:
|
|
|
|
|
|
|
|
|
|
|||
Salaries and employee benefits
|
|
86,912
|
|
|
86,837
|
|
|
86,133
|
|
|||
Net occupancy
|
|
10,624
|
|
|
9,686
|
|
|
9,768
|
|
|||
Furniture and equipment
|
|
20,769
|
|
|
19,500
|
|
|
18,348
|
|
|||
Depreciation — leased equipment
|
|
25,215
|
|
|
21,678
|
|
|
18,280
|
|
|||
Professional fees
|
|
6,810
|
|
|
5,161
|
|
|
4,682
|
|
|||
Supplies and communication
|
|
5,355
|
|
|
5,244
|
|
|
6,011
|
|
|||
FDIC and other insurance
|
|
2,537
|
|
|
3,147
|
|
|
3,412
|
|
|||
Business development and marketing
|
|
7,477
|
|
|
4,936
|
|
|
4,837
|
|
|||
Loan and lease collection and repossession
|
|
2,724
|
|
|
1,600
|
|
|
667
|
|
|||
Other
|
|
5,574
|
|
|
5,856
|
|
|
6,976
|
|
|||
Total noninterest expense
|
|
173,997
|
|
|
163,645
|
|
|
159,114
|
|
|||
Income before income taxes
|
|
101,360
|
|
|
89,126
|
|
|
88,563
|
|
|||
Income tax expense
|
|
33,309
|
|
|
31,340
|
|
|
31,077
|
|
|||
Net income
|
|
$
|
68,051
|
|
|
$
|
57,786
|
|
|
$
|
57,486
|
|
Basic net income per common share
|
|
$
|
2.60
|
|
|
$
|
2.22
|
|
|
$
|
2.17
|
|
Diluted net income per common share
|
|
$
|
2.60
|
|
|
$
|
2.22
|
|
|
$
|
2.17
|
|
Year Ended December 31
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Net income
|
|
$
|
68,051
|
|
|
$
|
57,786
|
|
|
$
|
57,486
|
|
Other comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|||
Unrealized depreciation of investment securities available-for-sale
|
|
(3,147
|
)
|
|
(6,547
|
)
|
|
(4,562
|
)
|
|||
Reclassification adjustment for realized gains included in net income
|
|
(4,340
|
)
|
|
(1,796
|
)
|
|
(4
|
)
|
|||
Income tax effect
|
|
2,811
|
|
|
3,132
|
|
|
1,714
|
|
|||
Other comprehensive loss, net of tax
|
|
(4,676
|
)
|
|
(5,211
|
)
|
|
(2,852
|
)
|
|||
Comprehensive income
|
|
$
|
63,375
|
|
|
$
|
52,575
|
|
|
$
|
54,634
|
|
(Dollars in thousands, except per share amounts)
|
|
Preferred Stock
|
|
Common Stock
|
|
Retained Earnings
|
|
Cost of Common Stock in Treasury
|
|
Accumulated Other Comprehensive Income (Loss), Net
|
|
Total
|
||||||||||||
Balance at January 1, 2015
|
|
$
|
—
|
|
|
$
|
346,535
|
|
|
$
|
302,242
|
|
|
$
|
(43,711
|
)
|
|
$
|
9,407
|
|
|
$
|
614,473
|
|
Net income
|
|
—
|
|
|
—
|
|
|
57,486
|
|
|
—
|
|
|
—
|
|
|
57,486
|
|
||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,852
|
)
|
|
(2,852
|
)
|
||||||
Issuance of 118,281 common shares under stock based compensation awards, including related tax effects
|
|
—
|
|
|
—
|
|
|
(245
|
)
|
|
2,829
|
|
|
—
|
|
|
2,584
|
|
||||||
Cost of 338,985 shares of common stock acquired for treasury
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9,970
|
)
|
|
—
|
|
|
(9,970
|
)
|
||||||
Common stock dividend ($0.671 per share)
|
|
—
|
|
|
—
|
|
|
(17,655
|
)
|
|
—
|
|
|
—
|
|
|
(17,655
|
)
|
||||||
10% common stock dividend ($13 cash paid in lieu of fractional shares)
|
|
—
|
|
|
90,003
|
|
|
(90,016
|
)
|
|
—
|
|
|
—
|
|
|
(13
|
)
|
||||||
Balance at December 31, 2015
|
|
$
|
—
|
|
|
$
|
436,538
|
|
|
$
|
251,812
|
|
|
$
|
(50,852
|
)
|
|
$
|
6,555
|
|
|
$
|
644,053
|
|
Net income
|
|
—
|
|
|
—
|
|
|
57,786
|
|
|
—
|
|
|
—
|
|
|
57,786
|
|
||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,211
|
)
|
|
(5,211
|
)
|
||||||
Issuance of 118,559 common shares under stock based compensation awards, including related tax effects
|
|
—
|
|
|
—
|
|
|
(18
|
)
|
|
2,826
|
|
|
—
|
|
|
2,808
|
|
||||||
Cost of 270,378 shares of common stock acquired for treasury
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,030
|
)
|
|
—
|
|
|
(8,030
|
)
|
||||||
Common stock dividend ($0.72 per share)
|
|
—
|
|
|
—
|
|
|
(18,756
|
)
|
|
—
|
|
|
—
|
|
|
(18,756
|
)
|
||||||
Balance at December 31, 2016
|
|
$
|
—
|
|
|
$
|
436,538
|
|
|
$
|
290,824
|
|
|
$
|
(56,056
|
)
|
|
$
|
1,344
|
|
|
$
|
672,650
|
|
Cumulative-effect adjustment
|
|
—
|
|
|
—
|
|
|
(65
|
)
|
|
—
|
|
|
—
|
|
|
(65
|
)
|
||||||
Balance at January 1, 2017, adjusted
|
|
—
|
|
|
436,538
|
|
|
290,759
|
|
|
(56,056
|
)
|
|
1,344
|
|
|
672,585
|
|
||||||
Net income
|
|
—
|
|
|
—
|
|
|
68,051
|
|
|
—
|
|
|
—
|
|
|
68,051
|
|
||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,676
|
)
|
|
(4,676
|
)
|
||||||
Issuance of 61,899 common shares under stock based compensation awards
|
|
—
|
|
|
—
|
|
|
908
|
|
|
1,469
|
|
|
—
|
|
|
2,377
|
|
||||||
Cost of 900 shares of common stock acquired for treasury
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(41
|
)
|
|
—
|
|
|
(41
|
)
|
||||||
Common stock dividend ($0.76 per share)
|
|
—
|
|
|
—
|
|
|
(19,759
|
)
|
|
—
|
|
|
—
|
|
|
(19,759
|
)
|
||||||
Balance at December 31, 2017
|
|
$
|
—
|
|
|
$
|
436,538
|
|
|
$
|
339,959
|
|
|
$
|
(54,628
|
)
|
|
$
|
(3,332
|
)
|
|
$
|
718,537
|
|
Year Ended December 31
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Operating activities:
|
|
|
|
|
|
|
|
|
|
|||
Net income
|
|
$
|
68,051
|
|
|
$
|
57,786
|
|
|
$
|
57,486
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
|
|||
Provision for loan and lease losses
|
|
8,980
|
|
|
5,833
|
|
|
2,160
|
|
|||
Depreciation of premises and equipment
|
|
5,658
|
|
|
5,245
|
|
|
4,780
|
|
|||
Depreciation of equipment owned and leased to others
|
|
25,215
|
|
|
21,678
|
|
|
18,280
|
|
|||
Stock-based compensation
|
|
2,963
|
|
|
2,884
|
|
|
3,843
|
|
|||
Amortization of investment securities premiums and accretion of discounts, net
|
|
5,449
|
|
|
5,861
|
|
|
4,652
|
|
|||
Amortization of mortgage servicing rights
|
|
1,092
|
|
|
1,478
|
|
|
1,424
|
|
|||
Deferred income taxes
|
|
2,767
|
|
|
2,856
|
|
|
1,620
|
|
|||
Gains on investment securities available-for-sale
|
|
(4,340
|
)
|
|
(1,796
|
)
|
|
(4
|
)
|
|||
Originations of loans held for sale, net of principal collected
|
|
(101,104
|
)
|
|
(119,134
|
)
|
|
(113,029
|
)
|
|||
Proceeds from the sales of loans held for sale
|
|
106,811
|
|
|
116,397
|
|
|
120,138
|
|
|||
Net gains on sale of loans held for sale
|
|
(2,981
|
)
|
|
(3,287
|
)
|
|
(3,330
|
)
|
|||
Net gains on sale of other real estate and repossessions
|
|
(251
|
)
|
|
(228
|
)
|
|
(814
|
)
|
|||
Change in trading account securities
|
|
—
|
|
|
—
|
|
|
205
|
|
|||
Change in interest receivable
|
|
(2,119
|
)
|
|
(1,326
|
)
|
|
(549
|
)
|
|||
Change in interest payable
|
|
1,222
|
|
|
570
|
|
|
798
|
|
|||
Change in other assets
|
|
(1,434
|
)
|
|
2,145
|
|
|
(8,230
|
)
|
|||
Change in other liabilities
|
|
(3,268
|
)
|
|
648
|
|
|
8,010
|
|
|||
Other
|
|
4,550
|
|
|
450
|
|
|
3,168
|
|
|||
Net change in operating activities
|
|
117,261
|
|
|
98,060
|
|
|
100,608
|
|
|||
Investing activities:
|
|
|
|
|
|
|
|
|
|
|||
Proceeds from sales of investment securities available-for-sale
|
|
228,715
|
|
|
23,784
|
|
|
1,299
|
|
|||
Proceeds from maturities and paydowns of investment securities available-for-sale
|
|
177,466
|
|
|
217,613
|
|
|
136,649
|
|
|||
Purchases of investment securities available-for-sale
|
|
(469,385
|
)
|
|
(313,074
|
)
|
|
(147,771
|
)
|
|||
Proceeds from liquidation of partnership investments
|
|
128
|
|
|
2,903
|
|
|
423
|
|
|||
Net change in other investments
|
|
(3,495
|
)
|
|
(485
|
)
|
|
(1,172
|
)
|
|||
Loans sold or participated to others
|
|
32,004
|
|
|
5,926
|
|
|
1,962
|
|
|||
Net change in loans and leases
|
|
(382,386
|
)
|
|
(209,668
|
)
|
|
(315,938
|
)
|
|||
Net change in equipment owned under operating leases
|
|
(46,003
|
)
|
|
(30,100
|
)
|
|
(54,508
|
)
|
|||
Purchases of premises and equipment
|
|
(5,444
|
)
|
|
(8,935
|
)
|
|
(9,498
|
)
|
|||
Proceeds from sales of other real estate and repossessions
|
|
6,194
|
|
|
2,189
|
|
|
6,941
|
|
|||
Net change in investing activities
|
|
(462,206
|
)
|
|
(309,847
|
)
|
|
(381,613
|
)
|
|||
Financing activities:
|
|
|
|
|
|
|
|
|
|
|||
Net change in demand deposits and savings accounts
|
|
205,649
|
|
|
278,666
|
|
|
173,508
|
|
|||
Net change in time deposits
|
|
213,321
|
|
|
(84,092
|
)
|
|
162,818
|
|
|||
Net change in short-term borrowings
|
|
(77,348
|
)
|
|
58,714
|
|
|
(12,593
|
)
|
|||
Proceeds from issuance of long-term debt
|
|
19,999
|
|
|
20,837
|
|
|
—
|
|
|||
Payments on long-term debt
|
|
(26,628
|
)
|
|
(6,429
|
)
|
|
(1,250
|
)
|
|||
Stock issued under stock purchase plans
|
|
153
|
|
|
120
|
|
|
149
|
|
|||
Acquisition of treasury stock
|
|
(41
|
)
|
|
(8,030
|
)
|
|
(9,970
|
)
|
|||
Cash dividends paid on common stock
|
|
(20,431
|
)
|
|
(19,416
|
)
|
|
(18,126
|
)
|
|||
Net change in financing activities
|
|
314,674
|
|
|
240,370
|
|
|
294,536
|
|
|||
Net change in cash and cash equivalents
|
|
(30,271
|
)
|
|
28,583
|
|
|
13,531
|
|
|||
Cash and cash equivalents, beginning of year
|
|
108,304
|
|
|
79,721
|
|
|
66,190
|
|
|||
Cash and cash equivalents, end of year
|
|
$
|
78,033
|
|
|
$
|
108,304
|
|
|
$
|
79,721
|
|
Supplemental Information:
|
|
|
|
|
|
|
|
|
|
|||
Non-cash transactions:
|
|
|
|
|
|
|
|
|
|
|||
Loans transferred to other real estate and repossessions
|
|
$
|
8,135
|
|
|
$
|
4,961
|
|
|
$
|
8,742
|
|
Common stock matching contribution to Employee Stock Ownership and Profit Sharing Plan
|
|
1,426
|
|
|
800
|
|
|
500
|
|
|||
Stock dividend paid on common stock
|
|
—
|
|
|
—
|
|
|
90,003
|
|
|||
Cash paid for:
|
|
|
|
|
|
|
|
|
|
|||
Interest
|
|
$
|
25,531
|
|
|
$
|
21,531
|
|
|
$
|
17,364
|
|
Income taxes
|
|
10,567
|
|
|
19,866
|
|
|
30,429
|
|
(Dollars in thousands)
|
|
Amortized Cost
|
|
Gross Unrealized Gains
|
|
Gross Unrealized Losses
|
|
Fair Value
|
||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. Treasury and Federal agencies securities
|
|
$
|
471,508
|
|
|
$
|
57
|
|
|
$
|
(3,446
|
)
|
|
$
|
468,119
|
|
U.S. States and political subdivisions securities
|
|
116,260
|
|
|
648
|
|
|
(908
|
)
|
|
116,000
|
|
||||
Mortgage-backed securities - Federal agencies
|
|
289,327
|
|
|
1,456
|
|
|
(2,873
|
)
|
|
287,910
|
|
||||
Corporate debt securities
|
|
31,573
|
|
|
5
|
|
|
(284
|
)
|
|
31,294
|
|
||||
Foreign government and other securities
|
|
700
|
|
|
10
|
|
|
—
|
|
|
710
|
|
||||
Total investment securities available-for-sale
|
|
$
|
909,368
|
|
|
$
|
2,176
|
|
|
$
|
(7,511
|
)
|
|
$
|
904,033
|
|
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. Treasury and Federal agencies securities
|
|
$
|
424,495
|
|
|
$
|
809
|
|
|
$
|
(4,471
|
)
|
|
$
|
420,833
|
|
U.S. States and political subdivisions securities
|
|
133,509
|
|
|
1,036
|
|
|
(1,570
|
)
|
|
132,975
|
|
||||
Mortgage-backed securities - Federal agencies
|
|
252,981
|
|
|
2,175
|
|
|
(2,582
|
)
|
|
252,574
|
|
||||
Corporate debt securities
|
|
35,266
|
|
|
111
|
|
|
(301
|
)
|
|
35,076
|
|
||||
Foreign government and other securities
|
|
800
|
|
|
7
|
|
|
—
|
|
|
807
|
|
||||
Total debt securities
|
|
847,051
|
|
|
4,138
|
|
|
(8,924
|
)
|
|
842,265
|
|
||||
Marketable equity securities
|
|
1,265
|
|
|
7,007
|
|
|
(70
|
)
|
|
8,202
|
|
||||
Total investment securities available-for-sale
|
|
$
|
848,316
|
|
|
$
|
11,145
|
|
|
$
|
(8,994
|
)
|
|
$
|
850,467
|
|
(Dollars in thousands)
|
|
Amortized Cost
|
|
Fair Value
|
||||
Due in one year or less
|
|
$
|
94,929
|
|
|
$
|
95,016
|
|
Due after one year through five years
|
|
493,262
|
|
|
489,615
|
|
||
Due after five years through ten years
|
|
31,850
|
|
|
31,492
|
|
||
Due after ten years
|
|
—
|
|
|
—
|
|
||
Mortgage-backed securities
|
|
289,327
|
|
|
287,910
|
|
||
Total debt securities available-for-sale
|
|
$
|
909,368
|
|
|
$
|
904,033
|
|
|
|
Less than 12 Months
|
|
12 months or Longer
|
|
Total
|
||||||||||||||||||
(Dollars in thousands)
|
|
Fair Value
|
|
Unrealized Losses
|
|
Fair Value
|
|
Unrealized Losses
|
|
Fair Value
|
|
Unrealized Losses
|
||||||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
U.S. Treasury and Federal agencies securities
|
|
$
|
311,865
|
|
|
$
|
(1,161
|
)
|
|
$
|
89,617
|
|
|
$
|
(2,285
|
)
|
|
$
|
401,482
|
|
|
$
|
(3,446
|
)
|
U.S. States and political subdivisions securities
|
|
34,971
|
|
|
(287
|
)
|
|
24,909
|
|
|
(621
|
)
|
|
59,880
|
|
|
(908
|
)
|
||||||
Mortgage-backed securities - Federal agencies
|
|
137,169
|
|
|
(1,336
|
)
|
|
60,162
|
|
|
(1,537
|
)
|
|
197,331
|
|
|
(2,873
|
)
|
||||||
Corporate debt securities
|
|
13,747
|
|
|
(57
|
)
|
|
10,048
|
|
|
(227
|
)
|
|
23,795
|
|
|
(284
|
)
|
||||||
Foreign government and other securities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total temporarily impaired available-for-sale securities
|
|
$
|
497,752
|
|
|
$
|
(2,841
|
)
|
|
$
|
184,736
|
|
|
$
|
(4,670
|
)
|
|
$
|
682,488
|
|
|
$
|
(7,511
|
)
|
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
U.S. Treasury and Federal agencies securities
|
|
$
|
263,680
|
|
|
$
|
(4,471
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
263,680
|
|
|
$
|
(4,471
|
)
|
U.S. States and political subdivisions securities
|
|
74,129
|
|
|
(1,515
|
)
|
|
3,337
|
|
|
(55
|
)
|
|
77,466
|
|
|
(1,570
|
)
|
||||||
Mortgage-backed securities - Federal agencies
|
|
168,554
|
|
|
(2,341
|
)
|
|
5,102
|
|
|
(241
|
)
|
|
173,656
|
|
|
(2,582
|
)
|
||||||
Corporate debt securities
|
|
13,312
|
|
|
(301
|
)
|
|
—
|
|
|
—
|
|
|
13,312
|
|
|
(301
|
)
|
||||||
Foreign government and other securities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total debt securities
|
|
519,675
|
|
|
(8,628
|
)
|
|
8,439
|
|
|
(296
|
)
|
|
528,114
|
|
|
(8,924
|
)
|
||||||
Marketable equity securities
|
|
280
|
|
|
(70
|
)
|
|
4
|
|
|
—
|
|
|
284
|
|
|
(70
|
)
|
||||||
Total temporarily impaired available-for-sale securities
|
|
$
|
519,955
|
|
|
$
|
(8,698
|
)
|
|
$
|
8,443
|
|
|
$
|
(296
|
)
|
|
$
|
528,398
|
|
|
$
|
(8,994
|
)
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Gross realized gains
|
|
$
|
7,425
|
|
|
$
|
2,090
|
|
|
$
|
4
|
|
Gross realized losses
|
|
(2,895
|
)
|
|
—
|
|
|
—
|
|
|||
OTTI losses
|
|
(190
|
)
|
|
(294
|
)
|
|
—
|
|
|||
Net realized gains
|
|
$
|
4,340
|
|
|
$
|
1,796
|
|
|
$
|
4
|
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
||||
Direct finance leases:
|
|
|
|
|
|
|
||
Rentals receivable
|
|
$
|
208,295
|
|
|
$
|
218,543
|
|
Estimated residual value of leased assets
|
|
29,638
|
|
|
21,992
|
|
||
Gross investment in lease financing
|
|
237,933
|
|
|
240,535
|
|
||
Unearned income
|
|
(37,851
|
)
|
|
(35,751
|
)
|
||
Net investment in lease financing
|
|
$
|
200,082
|
|
|
$
|
204,784
|
|
|
|
Credit Quality Grades
|
||||||||||
(Dollars in thousands)
|
|
1-6
|
|
7-12
|
|
Total
|
||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|||
Commercial and agricultural
|
|
$
|
906,074
|
|
|
$
|
23,923
|
|
|
$
|
929,997
|
|
Auto and light truck
|
|
482,455
|
|
|
14,361
|
|
|
496,816
|
|
|||
Medium and heavy duty truck
|
|
293,318
|
|
|
3,617
|
|
|
296,935
|
|
|||
Aircraft
|
|
815,956
|
|
|
28,701
|
|
|
844,657
|
|
|||
Construction equipment
|
|
552,684
|
|
|
10,753
|
|
|
563,437
|
|
|||
Commercial real estate
|
|
726,134
|
|
|
15,434
|
|
|
741,568
|
|
|||
Total
|
|
$
|
3,776,621
|
|
|
$
|
96,789
|
|
|
$
|
3,873,410
|
|
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|||
Commercial and agricultural
|
|
$
|
784,811
|
|
|
$
|
27,453
|
|
|
$
|
812,264
|
|
Auto and light truck
|
|
407,931
|
|
|
3,833
|
|
|
411,764
|
|
|||
Medium and heavy duty truck
|
|
291,558
|
|
|
3,232
|
|
|
294,790
|
|
|||
Aircraft
|
|
772,802
|
|
|
29,612
|
|
|
802,414
|
|
|||
Construction equipment
|
|
486,923
|
|
|
9,002
|
|
|
495,925
|
|
|||
Commercial real estate
|
|
707,252
|
|
|
11,918
|
|
|
719,170
|
|
|||
Total
|
|
$
|
3,451,277
|
|
|
$
|
85,050
|
|
|
$
|
3,536,327
|
|
(Dollars in thousands)
|
|
Performing
|
|
Nonperforming
|
|
Total
|
||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|||
Residential real estate and home equity
|
|
$
|
523,803
|
|
|
$
|
2,319
|
|
|
$
|
526,122
|
|
Consumer
|
|
127,982
|
|
|
164
|
|
|
128,146
|
|
|||
Total
|
|
$
|
651,785
|
|
|
$
|
2,483
|
|
|
$
|
654,268
|
|
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|||
Residential real estate and home equity
|
|
$
|
518,896
|
|
|
$
|
3,035
|
|
|
$
|
521,931
|
|
Consumer
|
|
129,585
|
|
|
228
|
|
|
129,813
|
|
|||
Total
|
|
$
|
648,481
|
|
|
$
|
3,263
|
|
|
$
|
651,744
|
|
(Dollars in thousands)
|
|
Current
|
|
30-59 Days Past Due
|
|
60-89 Days Past Due
|
|
90 Days or More Past Due and Accruing
|
|
Total Accruing Loans
|
|
Nonaccrual
|
|
Total Financing Receivables
|
||||||||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Commercial and agricultural
|
|
$
|
927,113
|
|
|
$
|
281
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
927,394
|
|
|
$
|
2,603
|
|
|
$
|
929,997
|
|
Auto and light truck
|
|
485,885
|
|
|
2,869
|
|
|
21
|
|
|
—
|
|
|
488,775
|
|
|
8,041
|
|
|
496,816
|
|
|||||||
Medium and heavy duty truck
|
|
296,564
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
296,564
|
|
|
371
|
|
|
296,935
|
|
|||||||
Aircraft
|
|
823,638
|
|
|
14,570
|
|
|
4,492
|
|
|
—
|
|
|
842,700
|
|
|
1,957
|
|
|
844,657
|
|
|||||||
Construction equipment
|
|
561,665
|
|
|
333
|
|
|
448
|
|
|
—
|
|
|
562,446
|
|
|
991
|
|
|
563,437
|
|
|||||||
Commercial real estate
|
|
738,006
|
|
|
23
|
|
|
121
|
|
|
—
|
|
|
738,150
|
|
|
3,418
|
|
|
741,568
|
|
|||||||
Residential real estate and home equity
|
|
521,943
|
|
|
1,508
|
|
|
352
|
|
|
429
|
|
|
524,232
|
|
|
1,890
|
|
|
526,122
|
|
|||||||
Consumer
|
|
127,107
|
|
|
776
|
|
|
99
|
|
|
30
|
|
|
128,012
|
|
|
134
|
|
|
128,146
|
|
|||||||
Total
|
|
$
|
4,481,921
|
|
|
$
|
20,360
|
|
|
$
|
5,533
|
|
|
$
|
459
|
|
|
$
|
4,508,273
|
|
|
$
|
19,405
|
|
|
$
|
4,527,678
|
|
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Commercial and agricultural
|
|
$
|
808,283
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
808,283
|
|
|
$
|
3,981
|
|
|
$
|
812,264
|
|
Auto and light truck
|
|
411,300
|
|
|
298
|
|
|
—
|
|
|
—
|
|
|
411,598
|
|
|
166
|
|
|
411,764
|
|
|||||||
Medium and heavy duty truck
|
|
294,790
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
294,790
|
|
|
—
|
|
|
294,790
|
|
|||||||
Aircraft
|
|
791,559
|
|
|
1,429
|
|
|
3,316
|
|
|
—
|
|
|
796,304
|
|
|
6,110
|
|
|
802,414
|
|
|||||||
Construction equipment
|
|
493,131
|
|
|
1,546
|
|
|
—
|
|
|
—
|
|
|
494,677
|
|
|
1,248
|
|
|
495,925
|
|
|||||||
Commercial real estate
|
|
713,482
|
|
|
133
|
|
|
—
|
|
|
—
|
|
|
713,615
|
|
|
5,555
|
|
|
719,170
|
|
|||||||
Residential real estate and home equity
|
|
517,212
|
|
|
1,310
|
|
|
374
|
|
|
394
|
|
|
519,290
|
|
|
2,641
|
|
|
521,931
|
|
|||||||
Consumer
|
|
129,000
|
|
|
453
|
|
|
132
|
|
|
22
|
|
|
129,607
|
|
|
206
|
|
|
129,813
|
|
|||||||
Total
|
|
$
|
4,158,757
|
|
|
$
|
5,169
|
|
|
$
|
3,822
|
|
|
$
|
416
|
|
|
$
|
4,168,164
|
|
|
$
|
19,907
|
|
|
$
|
4,188,071
|
|
(Dollars in thousands)
|
|
Recorded Investment
|
|
Unpaid Principal Balance
|
|
Related Reserve
|
||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|||
With no related reserve recorded:
|
|
|
|
|
|
|
|
|
|
|||
Commercial and agricultural
|
|
$
|
2,439
|
|
|
$
|
2,439
|
|
|
$
|
—
|
|
Auto and light truck
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Medium and heavy duty truck
|
|
371
|
|
|
371
|
|
|
—
|
|
|||
Aircraft
|
|
1,901
|
|
|
1,901
|
|
|
—
|
|
|||
Construction equipment
|
|
584
|
|
|
584
|
|
|
—
|
|
|||
Commercial real estate
|
|
2,375
|
|
|
2,375
|
|
|
—
|
|
|||
Residential real estate and home equity
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Consumer
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total with no related reserve recorded
|
|
7,670
|
|
|
7,670
|
|
|
—
|
|
|||
With a reserve recorded:
|
|
|
|
|
|
|
|
|
|
|||
Commercial and agricultural
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Auto and light truck
|
|
7,780
|
|
|
7,780
|
|
|
243
|
|
|||
Medium and heavy duty truck
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Aircraft
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Construction equipment
|
|
344
|
|
|
344
|
|
|
108
|
|
|||
Commercial real estate
|
|
971
|
|
|
971
|
|
|
181
|
|
|||
Residential real estate and home equity
|
|
352
|
|
|
354
|
|
|
134
|
|
|||
Consumer
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total with a reserve recorded
|
|
9,447
|
|
|
9,449
|
|
|
666
|
|
|||
Total impaired loans
|
|
$
|
17,117
|
|
|
$
|
17,119
|
|
|
$
|
666
|
|
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|||
With no related reserve recorded:
|
|
|
|
|
|
|
|
|
|
|||
Commercial and agricultural
|
|
$
|
1,700
|
|
|
$
|
1,700
|
|
|
$
|
—
|
|
Auto and light truck
|
|
115
|
|
|
115
|
|
|
—
|
|
|||
Medium and heavy duty truck
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Aircraft
|
|
2,918
|
|
|
2,918
|
|
|
—
|
|
|||
Construction equipment
|
|
605
|
|
|
605
|
|
|
—
|
|
|||
Commercial real estate
|
|
2,607
|
|
|
2,607
|
|
|
—
|
|
|||
Residential real estate and home equity
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Consumer
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total with no related reserve recorded
|
|
7,945
|
|
|
7,945
|
|
|
—
|
|
|||
With a reserve recorded:
|
|
|
|
|
|
|
|
|
|
|||
Commercial and agricultural
|
|
1,890
|
|
|
1,890
|
|
|
297
|
|
|||
Auto and light truck
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Medium and heavy duty truck
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Aircraft
|
|
3,192
|
|
|
3,192
|
|
|
1,076
|
|
|||
Construction equipment
|
|
562
|
|
|
562
|
|
|
35
|
|
|||
Commercial real estate
|
|
2,765
|
|
|
2,765
|
|
|
322
|
|
|||
Residential real estate and home equity
|
|
674
|
|
|
676
|
|
|
148
|
|
|||
Consumer
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total with a reserve recorded
|
|
9,083
|
|
|
9,085
|
|
|
1,878
|
|
|||
Total impaired loans
|
|
$
|
17,028
|
|
|
$
|
17,030
|
|
|
$
|
1,878
|
|
|
|
2017
|
|
2016
|
|
2015
|
||||||||||||||||||
(Dollars in thousands)
|
|
Average
Recorded
Investment
|
|
Interest
Income
|
|
Average
Recorded
Investment
|
|
Interest
Income
|
|
Average
Recorded
Investment
|
|
Interest
Income
|
||||||||||||
Commercial and agricultural
|
|
$
|
4,526
|
|
|
$
|
1
|
|
|
$
|
3,484
|
|
|
$
|
6
|
|
|
$
|
5,362
|
|
|
$
|
32
|
|
Auto and light truck
|
|
766
|
|
|
—
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Medium and heavy duty truck
|
|
658
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Aircraft
|
|
4,873
|
|
|
5
|
|
|
6,291
|
|
|
2
|
|
|
7,285
|
|
|
6
|
|
||||||
Construction equipment
|
|
1,011
|
|
|
—
|
|
|
766
|
|
|
—
|
|
|
695
|
|
|
—
|
|
||||||
Commercial real estate
|
|
3,220
|
|
|
2
|
|
|
5,417
|
|
|
123
|
|
|
10,126
|
|
|
518
|
|
||||||
Residential real estate and home equity
|
|
355
|
|
|
15
|
|
|
415
|
|
|
15
|
|
|
370
|
|
|
16
|
|
||||||
Consumer loans
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total
|
|
$
|
15,409
|
|
|
$
|
23
|
|
|
$
|
16,383
|
|
|
$
|
146
|
|
|
$
|
23,838
|
|
|
$
|
572
|
|
|
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||
(Dollars in thousands)
|
|
Number of Modifications
|
|
Recorded Investment
|
|
Number of Modifications
|
|
Recorded Investment
|
|
Number of Modifications
|
|
Recorded Investment
|
|||||||||
Performing TDRs:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Commercial and agricultural
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
2
|
|
|
$
|
218
|
|
Auto and light truck
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Medium and heavy duty truck
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Aircraft
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Construction equipment
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Commercial real estate
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Residential real estate and home equity
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Consumer
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total performing TDR modifications
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
218
|
|
|||
Nonperforming TDRs:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Commercial and agricultural
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Auto and light truck
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Medium and heavy duty truck
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Aircraft
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Construction equipment
|
|
—
|
|
|
—
|
|
|
1
|
|
|
562
|
|
|
—
|
|
|
—
|
|
|||
Commercial real estate
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Residential real estate and home equity
|
|
—
|
|
|
—
|
|
|
1
|
|
|
314
|
|
|
—
|
|
|
—
|
|
|||
Consumer
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total nonperforming TDR modifications
|
|
1
|
|
|
—
|
|
|
2
|
|
|
876
|
|
|
—
|
|
|
—
|
|
|||
Total TDR modifications
|
|
1
|
|
|
$
|
—
|
|
|
2
|
|
|
$
|
876
|
|
|
2
|
|
|
$
|
218
|
|
Year Ended December 31
(Dollars in thousands)
|
|
2017
|
|
2016
|
||||
Performing TDRs
|
|
$
|
352
|
|
|
$
|
360
|
|
Nonperforming TDRs
|
|
537
|
|
|
1,642
|
|
||
Total TDRs
|
|
$
|
889
|
|
|
$
|
2,002
|
|
(Dollars in thousands)
|
|
Commercial and agricultural
|
|
Auto and light truck
|
|
Medium and heavy duty truck
|
|
Aircraft
|
|
Construction equipment
|
|
Commercial real estate
|
|
Residential real estate and home equity
|
|
Consumer
|
|
Total
|
||||||||||||||||||
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Balance, beginning of year
|
|
$
|
14,668
|
|
|
$
|
8,064
|
|
|
$
|
4,740
|
|
|
$
|
34,352
|
|
|
$
|
8,207
|
|
|
$
|
13,677
|
|
|
$
|
3,550
|
|
|
$
|
1,285
|
|
|
$
|
88,543
|
|
Charge-offs
|
|
2,415
|
|
|
774
|
|
|
—
|
|
|
1,872
|
|
|
164
|
|
|
344
|
|
|
124
|
|
|
836
|
|
|
6,529
|
|
|||||||||
Recoveries
|
|
984
|
|
|
1,153
|
|
|
—
|
|
|
227
|
|
|
298
|
|
|
851
|
|
|
109
|
|
|
267
|
|
|
3,889
|
|
|||||||||
Net charge-offs (recoveries)
|
|
1,431
|
|
|
(379
|
)
|
|
—
|
|
|
1,645
|
|
|
(134
|
)
|
|
(507
|
)
|
|
15
|
|
|
569
|
|
|
2,640
|
|
|||||||||
Provision (recovery of provision)
|
|
2,991
|
|
|
1,660
|
|
|
104
|
|
|
1,912
|
|
|
1,002
|
|
|
608
|
|
|
131
|
|
|
572
|
|
|
8,980
|
|
|||||||||
Balance, end of year
|
|
$
|
16,228
|
|
|
$
|
10,103
|
|
|
$
|
4,844
|
|
|
$
|
34,619
|
|
|
$
|
9,343
|
|
|
$
|
14,792
|
|
|
$
|
3,666
|
|
|
$
|
1,288
|
|
|
$
|
94,883
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Balance, beginning of year
|
|
$
|
15,456
|
|
|
$
|
9,269
|
|
|
$
|
4,699
|
|
|
$
|
32,373
|
|
|
$
|
7,592
|
|
|
$
|
13,762
|
|
|
$
|
3,662
|
|
|
$
|
1,299
|
|
|
$
|
88,112
|
|
Charge-offs
|
|
547
|
|
|
4
|
|
|
—
|
|
|
6,123
|
|
|
128
|
|
|
32
|
|
|
219
|
|
|
888
|
|
|
7,941
|
|
|||||||||
Recoveries
|
|
509
|
|
|
253
|
|
|
10
|
|
|
528
|
|
|
461
|
|
|
469
|
|
|
31
|
|
|
278
|
|
|
2,539
|
|
|||||||||
Net charge-offs (recoveries)
|
|
38
|
|
|
(249
|
)
|
|
(10
|
)
|
|
5,595
|
|
|
(333
|
)
|
|
(437
|
)
|
|
188
|
|
|
610
|
|
|
5,402
|
|
|||||||||
Provision (recovery of provision)
|
|
(750
|
)
|
|
(1,454
|
)
|
|
31
|
|
|
7,574
|
|
|
282
|
|
|
(522
|
)
|
|
76
|
|
|
596
|
|
|
5,833
|
|
|||||||||
Balance, end of year
|
|
$
|
14,668
|
|
|
$
|
8,064
|
|
|
$
|
4,740
|
|
|
$
|
34,352
|
|
|
$
|
8,207
|
|
|
$
|
13,677
|
|
|
$
|
3,550
|
|
|
$
|
1,285
|
|
|
$
|
88,543
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Balance, beginning of year
|
|
$
|
11,760
|
|
|
$
|
10,326
|
|
|
$
|
4,500
|
|
|
$
|
32,234
|
|
|
$
|
7,008
|
|
|
$
|
13,270
|
|
|
$
|
4,504
|
|
|
$
|
1,466
|
|
|
$
|
85,068
|
|
Charge-offs
|
|
3,489
|
|
|
24
|
|
|
—
|
|
|
244
|
|
|
—
|
|
|
—
|
|
|
295
|
|
|
658
|
|
|
4,710
|
|
|||||||||
Recoveries
|
|
851
|
|
|
380
|
|
|
28
|
|
|
802
|
|
|
434
|
|
|
2,807
|
|
|
34
|
|
|
258
|
|
|
5,594
|
|
|||||||||
Net charge-offs (recoveries)
|
|
2,638
|
|
|
(356
|
)
|
|
(28
|
)
|
|
(558
|
)
|
|
(434
|
)
|
|
(2,807
|
)
|
|
261
|
|
|
400
|
|
|
(884
|
)
|
|||||||||
Provision (recovery of provision)
|
|
6,334
|
|
|
(1,413
|
)
|
|
171
|
|
|
(419
|
)
|
|
150
|
|
|
(2,315
|
)
|
|
(581
|
)
|
|
233
|
|
|
2,160
|
|
|||||||||
Balance, end of year
|
|
$
|
15,456
|
|
|
$
|
9,269
|
|
|
$
|
4,699
|
|
|
$
|
32,373
|
|
|
$
|
7,592
|
|
|
$
|
13,762
|
|
|
$
|
3,662
|
|
|
$
|
1,299
|
|
|
$
|
88,112
|
|
(Dollars in thousands)
|
|
Commercial and agricultural
|
|
Auto and light truck
|
|
Medium and heavy duty truck
|
|
Aircraft
|
|
Construction equipment
|
|
Commercial real estate
|
|
Residential real estate and home equity
|
|
Consumer
|
|
Total
|
||||||||||||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Reserve for loan and lease losses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Ending balance, individually evaluated for impairment
|
|
$
|
—
|
|
|
$
|
243
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
108
|
|
|
$
|
181
|
|
|
$
|
134
|
|
|
$
|
—
|
|
|
$
|
666
|
|
Ending balance, collectively evaluated for impairment
|
|
16,228
|
|
|
9,860
|
|
|
4,844
|
|
|
34,619
|
|
|
9,235
|
|
|
14,611
|
|
|
3,532
|
|
|
1,288
|
|
|
94,217
|
|
|||||||||
Total reserve for loan and lease losses
|
|
$
|
16,228
|
|
|
$
|
10,103
|
|
|
$
|
4,844
|
|
|
$
|
34,619
|
|
|
$
|
9,343
|
|
|
$
|
14,792
|
|
|
$
|
3,666
|
|
|
$
|
1,288
|
|
|
$
|
94,883
|
|
Recorded investment in loans
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Ending balance, individually evaluated for impairment
|
|
$
|
2,439
|
|
|
$
|
7,780
|
|
|
$
|
371
|
|
|
$
|
1,901
|
|
|
$
|
928
|
|
|
$
|
3,346
|
|
|
$
|
352
|
|
|
$
|
—
|
|
|
$
|
17,117
|
|
Ending balance, collectively evaluated for impairment
|
|
927,558
|
|
|
489,036
|
|
|
296,564
|
|
|
842,756
|
|
|
562,509
|
|
|
738,222
|
|
|
525,770
|
|
|
128,146
|
|
|
4,510,561
|
|
|||||||||
Total recorded investment in loans
|
|
$
|
929,997
|
|
|
$
|
496,816
|
|
|
$
|
296,935
|
|
|
$
|
844,657
|
|
|
$
|
563,437
|
|
|
$
|
741,568
|
|
|
$
|
526,122
|
|
|
$
|
128,146
|
|
|
$
|
4,527,678
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Reserve for loan and lease losses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Ending balance, individually evaluated for impairment
|
|
$
|
297
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,076
|
|
|
$
|
35
|
|
|
$
|
322
|
|
|
$
|
148
|
|
|
$
|
—
|
|
|
$
|
1,878
|
|
Ending balance, collectively evaluated for impairment
|
|
14,371
|
|
|
8,064
|
|
|
4,740
|
|
|
33,276
|
|
|
8,172
|
|
|
13,355
|
|
|
3,402
|
|
|
1,285
|
|
|
86,665
|
|
|||||||||
Total reserve for loan and lease losses
|
|
$
|
14,668
|
|
|
$
|
8,064
|
|
|
$
|
4,740
|
|
|
$
|
34,352
|
|
|
$
|
8,207
|
|
|
$
|
13,677
|
|
|
$
|
3,550
|
|
|
$
|
1,285
|
|
|
$
|
88,543
|
|
Recorded investment in loans
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Ending balance, individually evaluated for impairment
|
|
$
|
3,590
|
|
|
$
|
115
|
|
|
$
|
—
|
|
|
$
|
6,110
|
|
|
$
|
1,167
|
|
|
$
|
5,372
|
|
|
$
|
674
|
|
|
$
|
—
|
|
|
$
|
17,028
|
|
Ending balance, collectively evaluated for impairment
|
|
808,674
|
|
|
411,649
|
|
|
294,790
|
|
|
796,304
|
|
|
494,758
|
|
|
713,798
|
|
|
521,257
|
|
|
129,813
|
|
|
4,171,043
|
|
|||||||||
Total recorded investment in loans
|
|
$
|
812,264
|
|
|
$
|
411,764
|
|
|
$
|
294,790
|
|
|
$
|
802,414
|
|
|
$
|
495,925
|
|
|
$
|
719,170
|
|
|
$
|
521,931
|
|
|
$
|
129,813
|
|
|
$
|
4,188,071
|
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
||||
Land
|
|
$
|
15,413
|
|
|
$
|
16,127
|
|
Buildings and improvements
|
|
58,981
|
|
|
59,027
|
|
||
Furniture and equipment
|
|
39,978
|
|
|
37,604
|
|
||
Total premises and equipment
|
|
114,372
|
|
|
112,758
|
|
||
Accumulated depreciation and amortization
|
|
(59,760
|
)
|
|
(56,050
|
)
|
||
Net premises and equipment
|
|
$
|
54,612
|
|
|
$
|
56,708
|
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
||||
Mortgage servicing rights:
|
|
|
|
|
|
|
||
Balance at beginning of year
|
|
$
|
4,297
|
|
|
$
|
4,608
|
|
Additions
|
|
1,144
|
|
|
1,167
|
|
||
Amortization
|
|
(1,092
|
)
|
|
(1,478
|
)
|
||
Sales
|
|
—
|
|
|
—
|
|
||
Carrying value before valuation allowance at end of year
|
|
4,349
|
|
|
4,297
|
|
||
Valuation allowance:
|
|
|
|
|
|
|
||
Balance at beginning of year
|
|
—
|
|
|
—
|
|
||
Impairment recoveries
|
|
—
|
|
|
—
|
|
||
Balance at end of year
|
|
$
|
—
|
|
|
$
|
—
|
|
Net carrying value of mortgage servicing rights at end of year
|
|
$
|
4,349
|
|
|
$
|
4,297
|
|
Fair value of mortgage servicing rights at end of year
|
|
$
|
7,187
|
|
|
$
|
7,484
|
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
||||
Core deposit intangibles:
|
|
|
|
|
|
|
||
Gross carrying amount
|
|
$
|
9,546
|
|
|
$
|
9,566
|
|
Less: accumulated amortization
|
|
(9,484
|
)
|
|
(9,143
|
)
|
||
Net carrying amount
|
|
$
|
62
|
|
|
$
|
423
|
|
Other intangibles:
|
|
|
|
|
|
|
||
Gross carrying amount
|
|
$
|
—
|
|
|
$
|
—
|
|
Less: accumulated amortization
|
|
—
|
|
|
—
|
|
||
Net carrying amount
|
|
$
|
—
|
|
|
$
|
—
|
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
||||
Federal Home Loan Bank borrowings (1.04% – 5.86%)
|
|
$
|
47,114
|
|
|
$
|
53,075
|
|
Mandatorily redeemable securities
|
|
18,948
|
|
|
19,177
|
|
||
Other long-term debt
|
|
3,998
|
|
|
2,056
|
|
||
Total long-term debt and mandatorily redeemable securities
|
|
$
|
70,060
|
|
|
$
|
74,308
|
|
|
|
2017
|
|
2016
|
||||||||||
(Dollars in thousands)
|
|
Amount
|
|
Weighted Average Rate
|
|
Amount
|
|
Weighted Average Rate
|
||||||
Federal funds purchased
|
|
$
|
56,000
|
|
|
1.63
|
%
|
|
$
|
—
|
|
|
—
|
%
|
Security repurchase agreements
|
|
149,834
|
|
|
0.20
|
|
|
162,913
|
|
|
0.17
|
|
||
Commercial paper
|
|
6,115
|
|
|
0.27
|
|
|
5,761
|
|
|
0.27
|
|
||
Other short-term borrowings
|
|
2,646
|
|
|
—
|
|
|
123,269
|
|
|
0.57
|
|
||
Total short-term borrowings
|
|
$
|
214,595
|
|
|
0.57
|
%
|
|
$
|
291,943
|
|
|
0.34
|
%
|
(Dollars in thousands)
|
|
Amount of Subordinated Notes
|
|
Interest Rate
|
|
Maturity Date
|
|||
June 2007 issuance (1)
|
|
$
|
41,238
|
|
|
7.22
|
%
|
|
6/15/2037
|
August 2007 issuance (2)
|
|
17,526
|
|
|
3.07
|
%
|
|
9/15/2037
|
|
Total
|
|
$
|
58,764
|
|
|
|
|
|
|
|
(Dollars in thousands - except per share amounts)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Distributed earnings allocated to common stock
|
|
$
|
19,701
|
|
|
$
|
18,707
|
|
|
$
|
17,582
|
|
Undistributed earnings allocated to common stock
|
|
47,830
|
|
|
38,670
|
|
|
39,336
|
|
|||
Net earnings allocated to common stock
|
|
67,531
|
|
|
57,377
|
|
|
56,918
|
|
|||
Net earnings allocated to participating securities
|
|
520
|
|
|
409
|
|
|
568
|
|
|||
Net income allocated to common stock and participating securities
|
|
$
|
68,051
|
|
|
$
|
57,786
|
|
|
$
|
57,486
|
|
|
|
|
|
|
|
|
||||||
Weighted average shares outstanding for basic earnings per common share
|
|
25,925,820
|
|
|
25,879,397
|
|
|
26,173,351
|
|
|||
Dilutive effect of stock compensation
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Weighted average shares outstanding for diluted earnings per common share
|
|
25,925,820
|
|
|
25,879,397
|
|
|
26,173,351
|
|
|||
|
|
|
|
|
|
|
||||||
Basic earnings per common share
|
|
$
|
2.60
|
|
|
$
|
2.22
|
|
|
$
|
2.17
|
|
Diluted earnings per common share
|
|
$
|
2.60
|
|
|
$
|
2.22
|
|
|
$
|
2.17
|
|
|
|
|
|
|
|
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
Affected Line Item in the Statements of Income
|
||||
Realized gains included in net income
|
|
$
|
4,340
|
|
|
$
|
1,796
|
|
|
Gains on investment securities available-for-sale
|
|
|
4,340
|
|
|
1,796
|
|
|
Income before income taxes
|
||
Tax effect
|
|
(1,629
|
)
|
|
(674
|
)
|
|
Income tax expense
|
||
Net of tax
|
|
$
|
2,711
|
|
|
$
|
1,122
|
|
|
Net income
|
|
|
|
Non-Vested Stock Awards Outstanding
|
||||||
|
Shares Available for Grant
|
|
Number of Shares
|
|
Weighted-Average Grant-Date Fair Value
|
||||
Balance, January 1, 2015
|
2,460,208
|
|
|
440,035
|
|
|
$
|
20.60
|
|
Shares authorized - 2015 EIP
|
70,202
|
|
|
—
|
|
|
—
|
|
|
Granted
|
(81,591
|
)
|
|
81,591
|
|
|
24.44
|
|
|
Stock awards vested
|
—
|
|
|
(159,381
|
)
|
|
19.51
|
|
|
Forfeited
|
1,980
|
|
|
(3,384
|
)
|
|
23.85
|
|
|
Balance, December 31, 2015
|
2,450,799
|
|
|
358,861
|
|
|
21.93
|
|
|
Shares authorized - 2016 EIP
|
59,342
|
|
|
—
|
|
|
—
|
|
|
Shares authorized - Restricted Stock Award Plan
(1)
|
229,439
|
|
|
—
|
|
|
—
|
|
|
Granted
|
(79,118
|
)
|
|
79,118
|
|
|
26.19
|
|
|
Stock awards vested
|
—
|
|
|
(155,981
|
)
|
|
20.47
|
|
|
Forfeited
|
3,543
|
|
|
(5,383
|
)
|
|
23.39
|
|
|
Canceled
|
(1,950,000
|
)
|
|
—
|
|
|
—
|
|
|
Balance, December 31, 2016
|
714,005
|
|
|
276,615
|
|
|
23.94
|
|
|
Shares authorized - 2017 EIP
|
59,064
|
|
|
—
|
|
|
—
|
|
|
Granted
|
(98,625
|
)
|
|
98,625
|
|
|
33.54
|
|
|
Stock awards vested
|
—
|
|
|
(76,858
|
)
|
|
22.71
|
|
|
Forfeited
|
2,000
|
|
|
(2,456
|
)
|
|
29.93
|
|
|
Balance, December 31, 2017
|
676,444
|
|
|
295,926
|
|
|
$
|
27.41
|
|
|
|
|
|
|
|
|
Year Ended December 31
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Current:
|
|
|
|
|
|
|
|
|
|
|||
Federal
|
|
$
|
26,012
|
|
|
$
|
25,479
|
|
|
$
|
26,092
|
|
State
|
|
4,530
|
|
|
3,005
|
|
|
3,365
|
|
|||
Total current
|
|
30,542
|
|
|
28,484
|
|
|
29,457
|
|
|||
Deferred:
|
|
|
|
|
|
|
|
|
|
|||
Federal
|
|
5,869
|
|
|
2,530
|
|
|
1,577
|
|
|||
State
|
|
(488
|
)
|
|
326
|
|
|
43
|
|
|||
Deferred tax liability remeasurement
|
|
(2,614
|
)
|
|
—
|
|
|
—
|
|
|||
Total deferred
|
|
2,767
|
|
|
2,856
|
|
|
1,620
|
|
|||
Total provision
|
|
$
|
33,309
|
|
|
$
|
31,340
|
|
|
$
|
31,077
|
|
|
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||
Year Ended December 31
(Dollars in thousands)
|
|
Amount
|
|
Percent of Pretax Income
|
|
Amount
|
|
Percent of Pretax Income
|
|
Amount
|
|
Percent of Pretax Income
|
|||||||||
Statutory federal income tax
|
|
$
|
35,476
|
|
|
35.0
|
%
|
|
$
|
31,194
|
|
|
35.0
|
%
|
|
$
|
30,997
|
|
|
35.0
|
%
|
(Decrease) increase in income taxes resulting from:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Tax-exempt interest income
|
|
(1,197
|
)
|
|
(1.2
|
)
|
|
(1,235
|
)
|
|
(1.4
|
)
|
|
(1,152
|
)
|
|
(1.3
|
)
|
|||
State taxes, net of federal income tax benefit
|
|
2,627
|
|
|
2.6
|
|
|
2,165
|
|
|
2.4
|
|
|
2,215
|
|
|
2.5
|
|
|||
Deferred tax liability remeasurement
|
|
(2,614
|
)
|
|
(2.6
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Other
|
|
(983
|
)
|
|
(0.9
|
)
|
|
(784
|
)
|
|
(0.8
|
)
|
|
(983
|
)
|
|
(1.1
|
)
|
|||
Total
|
|
$
|
33,309
|
|
|
32.9
|
%
|
|
$
|
31,340
|
|
|
35.2
|
%
|
|
$
|
31,077
|
|
|
35.1
|
%
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
||||
Deferred tax assets:
|
|
|
|
|
|
|
||
Reserve for loan and lease losses
|
|
$
|
23,791
|
|
|
$
|
34,663
|
|
Accruals for employee benefits
|
|
2,369
|
|
|
3,948
|
|
||
Tax advantaged partnerships
|
|
—
|
|
|
1,411
|
|
||
Net unrealized losses on securities available-for-sale
|
|
1,285
|
|
|
—
|
|
||
Other
|
|
622
|
|
|
477
|
|
||
Total deferred tax assets
|
|
28,067
|
|
|
40,499
|
|
||
Deferred tax liabilities:
|
|
|
|
|
|
|
||
Differing depreciable bases in premises and leased equipment
|
|
22,641
|
|
|
31,449
|
|
||
Net unrealized gains on securities available-for-sale
|
|
—
|
|
|
807
|
|
||
Differing bases in assets related to acquisitions
|
|
3,954
|
|
|
6,170
|
|
||
Tax advantaged partnerships
|
|
1,921
|
|
|
—
|
|
||
Mortgage servicing
|
|
745
|
|
|
1,540
|
|
||
Capitalized loan costs
|
|
867
|
|
|
1,463
|
|
||
Prepaid expenses
|
|
387
|
|
|
646
|
|
||
Other
|
|
222
|
|
|
419
|
|
||
Total deferred tax liabilities
|
|
30,737
|
|
|
42,494
|
|
||
Net deferred tax liability
|
|
$
|
(2,670
|
)
|
|
$
|
(1,995
|
)
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Balance, beginning of year
|
|
$
|
762
|
|
|
$
|
380
|
|
|
$
|
—
|
|
Additions based on tax positions related to the current year
|
|
350
|
|
|
382
|
|
|
380
|
|
|||
Additions for tax positions of prior years
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Reductions for tax positions of prior years
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Reductions due to lapse in statute of limitations
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Settlements
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Balance, end of year
|
|
$
|
1,112
|
|
|
$
|
762
|
|
|
$
|
380
|
|
Year Ended December 31
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Gross rental expense
|
|
$
|
4,183
|
|
|
$
|
3,995
|
|
|
$
|
3,889
|
|
Gross rental income
|
|
(856
|
)
|
|
(921
|
)
|
|
(914
|
)
|
|||
Net rental expense
|
|
$
|
3,327
|
|
|
$
|
3,074
|
|
|
$
|
2,975
|
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
||||
Amounts of commitments:
|
|
|
|
|
||||
Loan commitments to extend credit
|
|
$
|
1,030,334
|
|
|
$
|
868,267
|
|
Standby letters of credit
|
|
$
|
29,961
|
|
|
$
|
33,397
|
|
Commercial and similar letters of credit
|
|
$
|
1,837
|
|
|
$
|
1,704
|
|
|
|
|
|
Asset derivatives
|
|
Liability derivatives
|
||||||||||
(Dollars in thousands)
|
|
Notional or contractual amount
|
|
Statement of Financial Condition classification
|
|
Fair value
|
|
Statement of Financial Condition classification
|
|
Fair value
|
||||||
Interest rate swap contracts
|
|
$
|
756,550
|
|
|
Other assets
|
|
$
|
5,167
|
|
|
Other liabilities
|
|
$
|
5,262
|
|
Loan commitments
|
|
8,504
|
|
|
Mortgages held for sale
|
|
66
|
|
|
N/A
|
|
—
|
|
|||
Forward contracts - mortgage loan
|
|
19,390
|
|
|
N/A
|
|
—
|
|
|
Mortgages held for sale
|
|
10
|
|
|||
Total - December 31, 2017
|
|
$
|
784,444
|
|
|
|
|
$
|
5,233
|
|
|
|
|
$
|
5,272
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Interest rate swap contracts
|
|
$
|
570,004
|
|
|
Other assets
|
|
$
|
6,621
|
|
|
Other liabilities
|
|
$
|
6,743
|
|
Loan commitments
|
|
5,527
|
|
|
Mortgages held for sale
|
|
43
|
|
|
N/A
|
|
—
|
|
|||
Forward contracts - mortgage loan
|
|
16,525
|
|
|
Mortgages held for sale
|
|
222
|
|
|
N/A
|
|
—
|
|
|||
Total - December 31, 2016
|
|
$
|
592,056
|
|
|
|
|
$
|
6,886
|
|
|
|
|
$
|
6,743
|
|
|
|
|
|
Gain (loss)
|
||||||||||
(Dollars in thousands)
|
|
Statement of Income classification
|
|
2017
|
|
2016
|
|
2015
|
||||||
Interest rate swap contracts
|
|
Other expense
|
|
$
|
26
|
|
|
$
|
64
|
|
|
$
|
(8
|
)
|
Interest rate swap contracts
|
|
Other income
|
|
1,585
|
|
|
730
|
|
|
1,045
|
|
|||
Loan commitments
|
|
Mortgage banking
|
|
23
|
|
|
(4
|
)
|
|
45
|
|
|||
Forward contracts - mortgage loan
|
|
Mortgage banking
|
|
(232
|
)
|
|
209
|
|
|
155
|
|
|||
Total
|
|
|
|
$
|
1,402
|
|
|
$
|
999
|
|
|
$
|
1,237
|
|
|
|
|
|
|
|
|
|
Gross Amounts Not Offset in the Statement of Financial Condition
|
|
|
||||||||||||||
(Dollars in thousands)
|
|
Gross Amounts of Recognized Assets
|
|
Gross Amounts Offset in the Statement of Financial Condition
|
|
Net Amounts of Assets Presented in the Statement of Financial Condition
|
|
Financial Instruments
|
|
Cash Collateral Received
|
|
Net Amount
|
||||||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest rate swaps
|
|
$
|
5,194
|
|
|
$
|
27
|
|
|
$
|
5,167
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,167
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest rate swaps
|
|
$
|
6,681
|
|
|
$
|
60
|
|
|
$
|
6,621
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,621
|
|
|
|
|
|
|
|
|
|
Gross Amounts Not Offset in the Statement of Financial Condition
|
|
|
||||||||||||||
(Dollars in thousands)
|
|
Gross Amounts of Recognized Liabilities
|
|
Gross Amounts Offset in the Statement of Financial Condition
|
|
Net Amounts of Liabilities Presented in the Statement of Financial Condition
|
|
Financial Instruments
|
|
Cash Collateral Pledged
|
|
Net Amount
|
||||||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest rate swaps
|
|
$
|
5,289
|
|
|
$
|
27
|
|
|
$
|
5,262
|
|
|
$
|
—
|
|
|
$
|
2,705
|
|
|
$
|
2,557
|
|
Repurchase agreements
|
|
149,835
|
|
|
—
|
|
|
149,835
|
|
|
149,835
|
|
|
—
|
|
|
—
|
|
||||||
Total
|
|
$
|
155,124
|
|
|
$
|
27
|
|
|
$
|
155,097
|
|
|
$
|
149,835
|
|
|
$
|
2,705
|
|
|
$
|
2,557
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest rate swaps
|
|
$
|
6,803
|
|
|
$
|
60
|
|
|
$
|
6,743
|
|
|
$
|
—
|
|
|
$
|
3,794
|
|
|
$
|
2,949
|
|
Repurchase agreements
|
|
162,913
|
|
|
—
|
|
|
162,913
|
|
|
162,913
|
|
|
—
|
|
|
—
|
|
||||||
Total
|
|
$
|
169,716
|
|
|
$
|
60
|
|
|
$
|
169,656
|
|
|
$
|
162,913
|
|
|
$
|
3,794
|
|
|
$
|
2,949
|
|
|
|
Actual
|
|
Minimum Capital Adequacy
|
|
Minimum Capital Adequacy with Capital Buffer
(1)
|
|
To Be Well Capitalized Under Prompt Corrective Action Provisions
|
||||||||||||||||||||
(Dollars in thousands)
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
||||||||||||
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Total Capital (to Risk-Weighted Assets):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
1st Source Corporation
|
|
$
|
764,853
|
|
|
14.70
|
%
|
|
$
|
416,174
|
|
|
8.00
|
%
|
|
$
|
481,201
|
|
|
9.25
|
%
|
|
$
|
520,218
|
|
|
10.00
|
%
|
1st Source Bank
|
|
696,248
|
|
|
13.36
|
|
|
416,902
|
|
|
8.00
|
|
|
482,043
|
|
|
9.25
|
|
|
521,127
|
|
|
10.00
|
|
||||
Tier 1 Capital (to Risk-Weighted Assets):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
1st Source Corporation
|
|
699,420
|
|
|
13.44
|
|
|
312,131
|
|
|
6.00
|
|
|
377,158
|
|
|
7.25
|
|
|
416,174
|
|
|
8.00
|
|
||||
1st Source Bank
|
|
630,702
|
|
|
12.10
|
|
|
312,676
|
|
|
6.00
|
|
|
377,817
|
|
|
7.25
|
|
|
416,902
|
|
|
8.00
|
|
||||
Common Equity Tier 1 Capital (to Risk-Weighted Assets):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
1st Source Corporation
|
|
642,420
|
|
|
12.35
|
|
|
234,098
|
|
|
4.50
|
|
|
299,125
|
|
|
5.75
|
|
|
338,142
|
|
|
6.50
|
|
||||
1st Source Bank
|
|
630,702
|
|
|
12.10
|
|
|
234,507
|
|
|
4.50
|
|
|
299,648
|
|
|
5.75
|
|
|
338,733
|
|
|
6.50
|
|
||||
Tier 1 Capital (to Average Assets):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
1st Source Corporation
|
|
699,420
|
|
|
12.17
|
|
|
229,890
|
|
|
4.00
|
|
|
N/A
|
|
|
N/A
|
|
|
287,362
|
|
|
5.00
|
|
||||
1st Source Bank
|
|
630,702
|
|
|
10.98
|
|
|
229,789
|
|
|
4.00
|
|
|
N/A
|
|
|
N/A
|
|
|
287,236
|
|
|
5.00
|
|
||||
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Total Capital (to Risk-Weighted Assets):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
1st Source Corporation
|
|
$
|
713,498
|
|
|
15.12
|
%
|
|
$
|
377,432
|
|
|
8.00
|
%
|
|
$
|
406,919
|
|
|
8.625
|
%
|
|
$
|
471,791
|
|
|
10.00
|
%
|
1st Source Bank
|
|
662,531
|
|
|
14.06
|
|
|
377,014
|
|
|
8.00
|
|
|
406,468
|
|
|
8.625
|
|
|
471,267
|
|
|
10.00
|
|
||||
Tier 1 Capital (to Risk-Weighted Assets):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
1st Source Corporation
|
|
651,006
|
|
|
13.80
|
|
|
283,074
|
|
|
6.00
|
|
|
312,561
|
|
|
6.625
|
|
|
377,432
|
|
|
8.00
|
|
||||
1st Source Bank
|
|
603,022
|
|
|
12.80
|
|
|
282,760
|
|
|
6.00
|
|
|
312,214
|
|
|
6.625
|
|
|
377,014
|
|
|
8.00
|
|
||||
Common Equity Tier 1 Capital (to Risk-Weighted Assets):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
1st Source Corporation
|
|
594,006
|
|
|
12.59
|
|
|
212,306
|
|
|
4.50
|
|
|
241,793
|
|
|
5.125
|
|
|
306,664
|
|
|
6.50
|
|
||||
1st Source Bank
|
|
603,022
|
|
|
12.80
|
|
|
212,070
|
|
|
4.50
|
|
|
241,524
|
|
|
5.125
|
|
|
306,324
|
|
|
6.50
|
|
||||
Tier 1 Capital (to Average Assets):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
1st Source Corporation
|
|
651,006
|
|
|
12.11
|
|
|
215,115
|
|
|
4.00
|
|
|
N/A
|
|
|
N/A
|
|
|
268,893
|
|
|
5.00
|
|
||||
1st Source Bank
|
|
603,022
|
|
|
11.22
|
|
|
214,949
|
|
|
4.00
|
|
|
N/A
|
|
|
N/A
|
|
|
268,686
|
|
|
5.00
|
|
|
(Dollars in thousands)
|
|
Fair value carrying amount
|
|
Aggregate unpaid principal
|
|
Excess of fair value carrying amount over (under) unpaid principal
|
|
||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|||
Mortgages held for sale reported at fair value:
|
|
|
|
|
|
|
|
|
|
|
|||
Total Loans
|
|
$
|
13,123
|
|
|
$
|
12,967
|
|
|
$
|
156
|
|
(1)
|
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|||
Mortgages held for sale reported at fair value:
|
|
|
|
|
|
|
|
|
|
|
|||
Total Loans
|
|
$
|
15,849
|
|
|
$
|
15,809
|
|
|
$
|
40
|
|
(1)
|
|
•
|
U.S. treasuries are priced using the market approach and utilizing live data feeds from active market exchanges for identical securities.
|
•
|
Government-sponsored agency debt securities and corporate bonds are primarily priced using available market information through processes such as benchmark curves, market valuations of like securities, sector groupings and matrix pricing.
|
•
|
Other government-sponsored agency securities, mortgage-backed securities and some of the actively traded REMICs and CMOs, are primarily priced using available market information including benchmark yields, prepayment speeds, spreads and volatility of similar securities.
|
•
|
Inactively traded government-sponsored agency securities are primarily priced using consensus pricing and dealer quotes.
|
•
|
State and political subdivisions are largely grouped by characteristics, i.e., geographical data and source of revenue in trade dissemination systems. Since some securities are not traded daily and due to other grouping limitations, active market quotes are often obtained using benchmarking for like securities. Local direct placement municipal securities, with very little market activity, are priced using an appropriate market yield curve which incorporates a credit spread assumption.
|
•
|
Marketable equity (common) securities are primarily priced using the market approach and utilizing live data feeds from active market exchanges for identical securities.
|
(Dollars in thousands)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Investment securities available-for-sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. Treasury and Federal agencies securities
|
|
$
|
27,971
|
|
|
$
|
440,148
|
|
|
$
|
—
|
|
|
$
|
468,119
|
|
U.S. States and political subdivisions securities
|
|
—
|
|
|
113,845
|
|
|
2,155
|
|
|
116,000
|
|
||||
Mortgage-backed securities - Federal agencies
|
|
—
|
|
|
287,910
|
|
|
—
|
|
|
287,910
|
|
||||
Corporate debt securities
|
|
—
|
|
|
31,294
|
|
|
—
|
|
|
31,294
|
|
||||
Foreign government and other securities
|
|
—
|
|
|
—
|
|
|
710
|
|
|
710
|
|
||||
Total investment securities available-for-sale
|
|
27,971
|
|
|
873,197
|
|
|
2,865
|
|
|
904,033
|
|
||||
Mortgages held for sale
|
|
—
|
|
|
13,123
|
|
|
—
|
|
|
13,123
|
|
||||
Accrued income and other assets (interest rate swap agreements)
|
|
—
|
|
|
5,167
|
|
|
—
|
|
|
5,167
|
|
||||
Total
|
|
$
|
27,971
|
|
|
$
|
891,487
|
|
|
$
|
2,865
|
|
|
$
|
922,323
|
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Accrued expenses and other liabilities (interest rate swap agreements)
|
|
$
|
—
|
|
|
$
|
5,262
|
|
|
$
|
—
|
|
|
$
|
5,262
|
|
Total
|
|
$
|
—
|
|
|
$
|
5,262
|
|
|
$
|
—
|
|
|
$
|
5,262
|
|
|
|
|
|
|
|
|
|
|
||||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Investment securities available-for-sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. Treasury and Federal agencies securities
|
|
$
|
20,164
|
|
|
$
|
400,669
|
|
|
$
|
—
|
|
|
$
|
420,833
|
|
U.S. States and political subdivisions securities
|
|
—
|
|
|
130,276
|
|
|
2,699
|
|
|
132,975
|
|
||||
Mortgage-backed securities - Federal agencies
|
|
—
|
|
|
252,574
|
|
|
—
|
|
|
252,574
|
|
||||
Corporate debt securities
|
|
—
|
|
|
35,076
|
|
|
—
|
|
|
35,076
|
|
||||
Foreign government and other securities
|
|
—
|
|
|
—
|
|
|
807
|
|
|
807
|
|
||||
Total debt securities
|
|
20,164
|
|
|
818,595
|
|
|
3,506
|
|
|
842,265
|
|
||||
Marketable equity securities
|
|
8,202
|
|
|
—
|
|
|
—
|
|
|
8,202
|
|
||||
Total investment securities available-for-sale
|
|
28,366
|
|
|
818,595
|
|
|
3,506
|
|
|
850,467
|
|
||||
Mortgages held for sale
|
|
—
|
|
|
15,849
|
|
|
—
|
|
|
15,849
|
|
||||
Accrued income and other assets (interest rate swap agreements)
|
|
—
|
|
|
6,621
|
|
|
—
|
|
|
6,621
|
|
||||
Total
|
|
$
|
28,366
|
|
|
$
|
841,065
|
|
|
$
|
3,506
|
|
|
$
|
872,937
|
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Accrued expenses and other liabilities (interest rate swap agreements)
|
|
$
|
—
|
|
|
$
|
6,743
|
|
|
$
|
—
|
|
|
$
|
6,743
|
|
Total
|
|
$
|
—
|
|
|
$
|
6,743
|
|
|
$
|
—
|
|
|
$
|
6,743
|
|
(Dollars in thousands)
|
|
U.S. States and political subdivisions securities
|
|
Foreign government and other securities
|
|
Investment securities available-for-sale
|
||||||
Beginning balance January 1, 2017
|
|
$
|
2,699
|
|
|
$
|
807
|
|
|
$
|
3,506
|
|
Total gains or losses (realized/unrealized):
|
|
|
|
|
|
|
|
|
||||
Included in earnings
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Included in other comprehensive income
|
|
31
|
|
|
3
|
|
|
34
|
|
|||
Purchases
|
|
1,437
|
|
|
500
|
|
|
1,937
|
|
|||
Issuances
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Sales
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Settlements
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Maturities
|
|
(2,012
|
)
|
|
(600
|
)
|
|
(2,612
|
)
|
|||
Transfers into Level 3
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Transfers out of Level 3
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Ending balance December 31, 2017
|
|
$
|
2,155
|
|
|
$
|
710
|
|
|
$
|
2,865
|
|
|
|
|
|
|
|
|
||||||
Beginning balance January 1, 2016
|
|
$
|
4,528
|
|
|
$
|
809
|
|
|
$
|
5,337
|
|
Total gains or losses (realized/unrealized):
|
|
|
|
|
|
|
|
|
||||
Included in earnings
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Included in other comprehensive income
|
|
(24
|
)
|
|
(2
|
)
|
|
(26
|
)
|
|||
Purchases
|
|
1,100
|
|
|
—
|
|
|
1,100
|
|
|||
Issuances
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Sales
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Settlements
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Maturities
|
|
(2,905
|
)
|
|
—
|
|
|
(2,905
|
)
|
|||
Transfers into Level 3
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Transfers out of Level 3
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Ending balance December 31, 2016
|
|
$
|
2,699
|
|
|
$
|
807
|
|
|
$
|
3,506
|
|
(Dollars in thousands)
|
|
Fair value
|
|
Valuation Methodology
|
|
Unobservable Inputs
|
|
Range of Inputs
|
||
December 31, 2017
|
|
|
|
|
|
|
|
|
||
Investment securities available-for-sale
|
|
|
|
|
|
|
|
|
|
|
Direct placement municipal securities
|
|
$
|
2,155
|
|
|
Discounted cash flows
|
|
Credit spread assumption
|
|
2.21% - 2.93%
|
|
|
|
|
|
|
|
|
|
||
Foreign government
|
|
$
|
710
|
|
|
Discounted cash flows
|
|
Market yield assumption
|
|
0.35% - 1.23%
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
December 31, 2016
|
|
|
|
|
|
|
|
|
||
Investment securities available-for-sale
|
|
|
|
|
|
|
|
|
||
Direct placement municipal securities
|
|
$
|
2,699
|
|
|
Discounted cash flows
|
|
Credit spread assumption
|
|
0.92% - 3.17%
|
|
|
|
|
|
|
|
|
|
||
Foreign government
|
|
$
|
807
|
|
|
Discounted cash flows
|
|
Market yield assumption
|
|
0.28% - 1.12%
|
(Dollars in thousands)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Impaired loans - collateral based
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7,994
|
|
|
$
|
7,994
|
|
Accrued income and other assets (partnership investments)
|
|
—
|
|
|
—
|
|
|
1,000
|
|
|
1,000
|
|
||||
Accrued income and other assets (mortgage servicing rights)
|
|
—
|
|
|
—
|
|
|
4,349
|
|
|
4,349
|
|
||||
Accrued income and other assets (repossessions)
|
|
—
|
|
|
—
|
|
|
10,114
|
|
|
10,114
|
|
||||
Accrued income and other assets (other real estate)
|
|
—
|
|
|
—
|
|
|
1,312
|
|
|
1,312
|
|
||||
Total
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
24,769
|
|
|
$
|
24,769
|
|
|
|
|
|
|
|
|
|
|
||||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Impaired loans - collateral based
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,280
|
|
|
$
|
6,280
|
|
Accrued income and other assets (partnership investments)
|
|
—
|
|
|
—
|
|
|
1,032
|
|
|
1,032
|
|
||||
Accrued income and other assets (mortgage servicing rights)
|
|
—
|
|
|
—
|
|
|
4,297
|
|
|
4,297
|
|
||||
Accrued income and other assets (repossessions)
|
|
—
|
|
|
—
|
|
|
9,373
|
|
|
9,373
|
|
||||
Accrued income and other assets (other real estate)
|
|
—
|
|
|
—
|
|
|
704
|
|
|
704
|
|
||||
Total
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
21,686
|
|
|
$
|
21,686
|
|
(Dollars in thousands)
|
|
Carrying Value
|
|
Fair value
|
|
Valuation Methodology
|
|
Unobservable Inputs
|
|
Range of Inputs
|
||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
||||
Impaired loans
|
|
$
|
7,994
|
|
|
$
|
7,994
|
|
|
Collateral based measurements including appraisals, trade publications, and auction values
|
|
Discount for lack of marketability and current conditions
|
|
3% - 20%
|
|
|
|
|
|
|
|
|
|
|
|
||||
Mortgage servicing rights
|
|
4,349
|
|
|
7,187
|
|
|
Discounted cash flows
|
|
Constant prepayment rate (CPR)
|
|
8.6% - 20.7%
|
||
|
|
|
|
|
|
|
|
|
|
Discount rate
|
|
9.6% - 12.5%
|
||
|
|
|
|
|
|
|
|
|
|
|
||||
Repossessions
|
|
10,114
|
|
|
10,493
|
|
|
Appraisals, trade publications and auction values
|
|
Discount for lack of marketability
|
|
3% - 10%
|
||
|
|
|
|
|
|
|
|
|
|
|
||||
Other real estate
|
|
1,312
|
|
|
1,441
|
|
|
Appraisals
|
|
Discount for lack of marketability
|
|
7% - 9%
|
||
|
|
|
|
|
|
|
|
|
|
|
||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
||||
Impaired loans
|
|
$
|
6,280
|
|
|
$
|
6,280
|
|
|
Collateral based measurements including appraisals, trade publications, and auction values
|
|
Discount for lack of marketability and current conditions
|
|
0% - 100%
|
|
|
|
|
|
|
|
|
|
|
|
||||
Mortgage servicing rights
|
|
4,297
|
|
|
7,484
|
|
|
Discounted cash flows
|
|
Constant prepayment rate (CPR)
|
|
8.6% - 15.0%
|
||
|
|
|
|
|
|
|
|
|
|
Discount rate
|
|
9.6% - 12.5%
|
||
|
|
|
|
|
|
|
|
|
|
|
||||
Repossessions
|
|
9,373
|
|
|
9,452
|
|
|
Appraisals, trade publications and auction values
|
|
Discount for lack of marketability
|
|
0% - 4%
|
||
|
|
|
|
|
|
|
|
|
|
|
||||
Other real estate
|
|
704
|
|
|
752
|
|
|
Appraisals
|
|
Discount for lack of marketability
|
|
0% - 16%
|
(Dollars in thousands)
|
|
Carrying or Contract Value
|
|
Fair Value
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and due from banks
|
|
$
|
73,635
|
|
|
$
|
73,635
|
|
|
$
|
73,635
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Federal funds sold and interest bearing deposits with other banks
|
|
4,398
|
|
|
4,398
|
|
|
4,398
|
|
|
—
|
|
|
—
|
|
|||||
Investment securities, available-for-sale
|
|
904,033
|
|
|
904,033
|
|
|
27,971
|
|
|
873,197
|
|
|
2,865
|
|
|||||
Other investments
|
|
25,953
|
|
|
25,953
|
|
|
25,953
|
|
|
—
|
|
|
—
|
|
|||||
Mortgages held for sale
|
|
13,123
|
|
|
13,123
|
|
|
—
|
|
|
13,123
|
|
|
—
|
|
|||||
Loans and leases, net of reserve for loan and lease losses
|
|
4,432,795
|
|
|
4,428,848
|
|
|
—
|
|
|
—
|
|
|
4,428,848
|
|
|||||
Mortgage servicing rights
|
|
4,349
|
|
|
7,187
|
|
|
—
|
|
|
—
|
|
|
7,187
|
|
|||||
Interest rate swaps
|
|
5,167
|
|
|
5,167
|
|
|
—
|
|
|
5,167
|
|
|
—
|
|
|||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Deposits
|
|
$
|
4,752,730
|
|
|
$
|
4,745,111
|
|
|
$
|
3,482,757
|
|
|
$
|
1,262,354
|
|
|
$
|
—
|
|
Short-term borrowings
|
|
214,595
|
|
|
214,595
|
|
|
206,862
|
|
|
7,733
|
|
|
—
|
|
|||||
Long-term debt and mandatorily redeemable securities
|
|
70,060
|
|
|
67,857
|
|
|
—
|
|
|
67,857
|
|
|
—
|
|
|||||
Subordinated notes
|
|
58,764
|
|
|
57,103
|
|
|
—
|
|
|
57,103
|
|
|
—
|
|
|||||
Interest rate swaps
|
|
5,262
|
|
|
5,262
|
|
|
—
|
|
|
5,262
|
|
|
—
|
|
|||||
Off-balance-sheet instruments *
|
|
—
|
|
|
286
|
|
|
—
|
|
|
286
|
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and due from banks
|
|
$
|
58,578
|
|
|
$
|
58,578
|
|
|
$
|
58,578
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Federal funds sold and interest bearing deposits with other banks
|
|
49,726
|
|
|
49,726
|
|
|
49,726
|
|
|
—
|
|
|
—
|
|
|||||
Investment securities, available-for-sale
|
|
850,467
|
|
|
850,467
|
|
|
28,366
|
|
|
818,595
|
|
|
3,506
|
|
|||||
Other investments and trading account securities
|
|
22,458
|
|
|
22,458
|
|
|
22,458
|
|
|
—
|
|
|
—
|
|
|||||
Mortgages held for sale
|
|
15,849
|
|
|
15,849
|
|
|
—
|
|
|
15,849
|
|
|
—
|
|
|||||
Loans and leases, net of reserve for loan and lease losses
|
|
4,099,528
|
|
|
4,107,079
|
|
|
—
|
|
|
—
|
|
|
4,107,079
|
|
|||||
Mortgage servicing rights
|
|
4,297
|
|
|
7,484
|
|
|
—
|
|
|
—
|
|
|
7,484
|
|
|||||
Interest rate swaps
|
|
6,621
|
|
|
6,621
|
|
|
—
|
|
|
6,621
|
|
|
—
|
|
|||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Deposits
|
|
$
|
4,333,760
|
|
|
$
|
4,332,744
|
|
|
$
|
3,277,108
|
|
|
$
|
1,055,636
|
|
|
$
|
—
|
|
Short-term borrowings
|
|
291,943
|
|
|
291,943
|
|
|
163,652
|
|
|
128,291
|
|
|
—
|
|
|||||
Long-term debt and mandatorily redeemable securities
|
|
74,308
|
|
|
73,149
|
|
|
—
|
|
|
73,149
|
|
|
—
|
|
|||||
Subordinated notes
|
|
58,764
|
|
|
51,031
|
|
|
—
|
|
|
51,031
|
|
|
—
|
|
|||||
Interest rate swaps
|
|
6,743
|
|
|
6,743
|
|
|
—
|
|
|
6,743
|
|
|
—
|
|
|||||
Off-balance-sheet instruments *
|
|
—
|
|
|
382
|
|
|
—
|
|
|
382
|
|
|
—
|
|
|
December 31
(Dollars in thousands)
|
|
2017
|
|
2016
|
||||
ASSETS
|
|
|
|
|
|
|
||
Cash and cash equivalents
|
|
$
|
100,155
|
|
|
$
|
73,324
|
|
Short-term investments with bank subsidiary
|
|
500
|
|
|
500
|
|
||
Investment securities available-for-sale
(amortized cost of $0 at December 31, 2017 and $884 at December 31, 2016) |
|
—
|
|
|
7,369
|
|
||
Investments in:
|
|
|
|
|
|
|
||
Bank subsidiaries
|
|
706,119
|
|
|
676,915
|
|
||
Non-bank subsidiaries
|
|
1
|
|
|
1,812
|
|
||
Other assets
|
|
2,696
|
|
|
4,013
|
|
||
Total assets
|
|
$
|
809,471
|
|
|
$
|
763,933
|
|
|
|
|
|
|
||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
||
Commercial paper
|
|
$
|
6,115
|
|
|
$
|
5,761
|
|
Long-term debt and mandatorily redeemable securities
|
|
22,942
|
|
|
21,228
|
|
||
Subordinated notes
|
|
58,764
|
|
|
58,764
|
|
||
Other liabilities
|
|
3,113
|
|
|
5,530
|
|
||
Total liabilities
|
|
90,934
|
|
|
91,283
|
|
||
Total shareholders’ equity
|
|
718,537
|
|
|
672,650
|
|
||
Total liabilities and shareholders’ equity
|
|
$
|
809,471
|
|
|
$
|
763,933
|
|
Year Ended December 31
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Income:
|
|
|
|
|
|
|
|
|
|
|||
Dividends from bank subsidiary
|
|
$
|
38,317
|
|
|
$
|
36,064
|
|
|
$
|
36,064
|
|
Dividends from non-bank subsidiary
|
|
958
|
|
|
—
|
|
|
—
|
|
|||
Rental income from subsidiaries
|
|
2,354
|
|
|
2,363
|
|
|
2,342
|
|
|||
Other
|
|
422
|
|
|
444
|
|
|
426
|
|
|||
Investment securities and other investment gains
|
|
6,431
|
|
|
3,901
|
|
|
26
|
|
|||
Total income
|
|
48,482
|
|
|
42,772
|
|
|
38,858
|
|
|||
Expenses:
|
|
|
|
|
|
|
|
|
|
|||
Interest on subordinated notes
|
|
4,002
|
|
|
4,220
|
|
|
4,220
|
|
|||
Interest on long-term debt and mandatorily redeemable securities
|
|
1,685
|
|
|
1,454
|
|
|
1,375
|
|
|||
Interest on commercial paper and other short-term borrowings
|
|
17
|
|
|
20
|
|
|
30
|
|
|||
Rent
|
|
2,070
|
|
|
1,739
|
|
|
1,737
|
|
|||
Other
|
|
1,733
|
|
|
1,179
|
|
|
351
|
|
|||
Total expenses
|
|
9,507
|
|
|
8,612
|
|
|
7,713
|
|
|||
Income before income tax benefit and equity in undistributed income of subsidiaries
|
|
38,975
|
|
|
34,160
|
|
|
31,145
|
|
|||
Income tax benefit
|
|
204
|
|
|
741
|
|
|
1,721
|
|
|||
Income before equity in undistributed income of subsidiaries
|
|
39,179
|
|
|
34,901
|
|
|
32,866
|
|
|||
Equity in undistributed income of subsidiaries:
|
|
|
|
|
|
|
|
|
|
|||
Bank subsidiaries
|
|
28,872
|
|
|
22,569
|
|
|
24,289
|
|
|||
Non-bank subsidiaries
|
|
—
|
|
|
316
|
|
|
331
|
|
|||
Net income
|
|
$
|
68,051
|
|
|
$
|
57,786
|
|
|
$
|
57,486
|
|
Comprehensive income
|
|
$
|
63,375
|
|
|
$
|
52,575
|
|
|
$
|
54,634
|
|
Year Ended December 31
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Operating activities:
|
|
|
|
|
|
|
|
|
|
|||
Net income
|
|
$
|
68,051
|
|
|
$
|
57,786
|
|
|
$
|
57,486
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
|
|||
Equity (undistributed) distributed in excess of income of subsidiaries
|
|
(28,872
|
)
|
|
(22,885
|
)
|
|
(24,620
|
)
|
|||
Depreciation of premises and equipment
|
|
2
|
|
|
4
|
|
|
9
|
|
|||
Stock-based compensation
|
|
48
|
|
|
52
|
|
|
64
|
|
|||
Realized/unrealized investment securities and other investment gains
|
|
(6,431
|
)
|
|
(3,901
|
)
|
|
(26
|
)
|
|||
Change in trading account securities
|
|
—
|
|
|
—
|
|
|
205
|
|
|||
Other
|
|
4,122
|
|
|
3,132
|
|
|
2,585
|
|
|||
Net change in operating activities
|
|
36,920
|
|
|
34,188
|
|
|
35,703
|
|
|||
Investing activities:
|
|
|
|
|
|
|
|
|
|
|||
Proceeds from sales and maturities of investment securities
|
|
6,327
|
|
|
1,795
|
|
|
1,470
|
|
|||
Net change in partnership investments
|
|
(62
|
)
|
|
2,903
|
|
|
423
|
|
|||
Return of capital from subsidiaries
|
|
854
|
|
|
—
|
|
|
—
|
|
|||
Net change in investing activities
|
|
7,119
|
|
|
4,698
|
|
|
1,893
|
|
|||
Financing activities:
|
|
|
|
|
|
|
|
|
|
|||
Net change in commercial paper
|
|
354
|
|
|
(2,281
|
)
|
|
(4,126
|
)
|
|||
Proceeds from issuance of long-term debt and mandatorily redeemable securities
|
|
1,248
|
|
|
1,607
|
|
|
1,520
|
|
|||
Payments on long-term debt and mandatorily redeemable securities
|
|
(667
|
)
|
|
(627
|
)
|
|
(712
|
)
|
|||
Stock issued under stock purchase plans
|
|
153
|
|
|
120
|
|
|
149
|
|
|||
Net proceeds from issuance of treasury stock
|
|
2,176
|
|
|
2,636
|
|
|
2,373
|
|
|||
Acquisition of treasury stock
|
|
(41
|
)
|
|
(8,030
|
)
|
|
(9,970
|
)
|
|||
Cash dividends paid on common stock
|
|
(20,431
|
)
|
|
(19,416
|
)
|
|
(18,126
|
)
|
|||
Net change in financing activities
|
|
(17,208
|
)
|
|
(25,991
|
)
|
|
(28,892
|
)
|
|||
Net change in cash and cash equivalents
|
|
26,831
|
|
|
12,895
|
|
|
8,704
|
|
|||
Cash and cash equivalents, beginning of year
|
|
73,324
|
|
|
60,429
|
|
|
51,725
|
|
|||
Cash and cash equivalents, end of year
|
|
$
|
100,155
|
|
|
$
|
73,324
|
|
|
$
|
60,429
|
|
By
|
/s/ CHRISTOPHER J. MURPHY III
|
|
|
Christopher J. Murphy III, Chief Executive Officer
|
|
|
|
|
|
|
|
By
|
/s/ ANDREA G. SHORT
|
|
|
Andrea G. Short, Treasurer and Chief Financial Officer
|
|
|
|
(A) Number of Securities to be Issued upon Exercise of Outstanding Options, Warrants and Rights
|
|
Weighted-average Exercise Price of Outstanding Options, Warrants and Rights
|
|
Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans [excluding securities reflected in column (A)]
|
|
||||
Equity compensation plans approved by shareholders
|
|
|
|
|
|
|
|
|
|
|
|
2011 Stock Option Plan
|
|
—
|
|
|
$
|
—
|
|
|
250,000
|
|
|
1997 Employee Stock Purchase Plan
|
|
8,177
|
|
|
38.85
|
|
|
123,206
|
|
|
|
1982 Executive Incentive Plan
|
|
—
|
|
|
—
|
|
|
96,178
|
|
(1)(2)
|
|
1982 Restricted Stock Award Plan
|
|
—
|
|
|
—
|
|
|
231,621
|
|
(1)
|
|
Strategic Deployment Incentive Plan
|
|
—
|
|
|
—
|
|
|
98,645
|
|
(1)(2)
|
|
Total plans approved by shareholders
|
|
8,177
|
|
|
$
|
38.85
|
|
|
799,650
|
|
|
Equity compensation plans not approved by shareholders
|
|
|
|
|
|
|
|
||||
Director Retainer Stock Plan
|
|
—
|
|
|
—
|
|
|
56,576
|
|
|
|
Total equity compensation plans
|
|
8,177
|
|
|
$
|
38.85
|
|
|
856,226
|
|
|
|
(1)
|
Amount is to be awarded by grants administered by the Executive Compensation and Human Resources Committee of the 1st Source Corporation Board of Directors.
|
(2)
|
Amount includes market value stock only. Book value shares used for annual awards may only be sold to 1st Source.
|
3(a)
|
|
|
|
|
|
3(b)
|
|
|
|
|
|
3(c)
|
|
|
|
|
|
4(a)
|
|
Form of Common Stock Certificates of Registrant, filed as exhibit to Registration Statement 2-40481 and incorporated herein by reference.
|
|
|
|
4(b)
|
|
1st Source agrees to furnish to the Commission, upon request, a copy of each instrument defining the rights of holders of Senior and Subordinated debt of 1st Source.
|
|
|
|
10(a)(1)
|
|
Employment Agreement of Christopher J. Murphy III, dated January 1, 2008,
filed as exhibit to Form 8-K, dated March 17
, 2008, amended February 6, 2014,
filed as exhibit to Form 8-K, dated March 12, 2014
, and incorporated herein by reference.
|
|
|
|
10(a)(2)
|
|
Employment Agreement of Andrea G. Short dated January 1, 2013,
filed as exhibit to Form 10-K, dated December 31, 2012
, amended February 6, 2014,
filed as exhibit to Form 8-K, dated March 12, 2014
, and incorporated herein by reference.
|
|
|
|
10(a)(3)
|
|
Employment Agreement of John B. Griffith, dated January 1, 2008,
filed as exhibit to Form 8-K, dated March 17, 2008
, amended February 6, 2014,
filed as exhibit to Form 8-K, dated March 12, 2014
, and incorporated herein by reference.
|
|
|
|
10(a)(4)
|
|
|
|
|
|
10(a)(5)
|
|
|
|
|
|
10(b)
|
|
|
|
|
|
10(c)
|
|
|
|
|
|
10(d)
|
|
|
|
|
|
10(e)
|
|
|
|
|
|
10(f)
|
|
|
|
|
|
10(g)
|
|
21
|
|
Subsidiaries of Registrant (unless otherwise indicated, each subsidiary does business under its own name):
|
Name
|
|
Jurisdiction
|
1st Source Bank
|
|
Indiana
|
SFG Aircraft, Inc. *
(formerly known as SFG Equipment Leasing, Inc.)
|
|
Indiana
|
1st Source Insurance, Inc. *
|
|
Indiana
|
1st Source Specialty Finance, Inc. *
|
|
Indiana
|
1st Source Capital Corporation *
|
|
Indiana
|
Trustcorp Mortgage Company (Inactive)
|
|
Indiana
|
1st Source Master Trust
|
|
Delaware
|
Michigan Transportation Finance Corporation *
|
|
Michigan
|
1st Source Intermediate Holding, LLC
|
|
Delaware
|
1st Source Funding, LLC (Inactive)
|
|
Delaware
|
1st Source Corporation Investment Advisors, Inc. *
|
|
Indiana
|
SFG Commercial Aircraft Leasing, Inc. *
|
|
Indiana
|
SFG Equipment Leasing Corporation I*
|
|
Indiana
|
Washington and Michigan Insurance, Inc.*
|
|
Arizona
|
1st Source Solar 1, LLC*
|
|
Delaware
|
|
*Wholly-owned subsidiaries of 1st Source Bank
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
101.INS
|
|
XBRL Instance Document
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Labels Linkbase Document
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
By
|
/s/ CHRISTOPHER J. MURPHY III
|
|
|
|
|
|
|
|
|
|
|
Christopher J. Murphy III, Chairman of the Board
|
|
|
|
and Chief Executive Officer
|
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/ CHRISTOPHER J. MURPHY III
|
|
Chairman of the Board
|
|
February 16, 2018
|
Christopher J. Murphy III
|
|
and Chief Executive Officer
|
|
|
|
|
|
|
|
/s/ JAMES R. SEITZ
|
|
President
|
|
February 16, 2018
|
James R. Seitz
|
|
|
|
|
|
|
|
|
|
/s/ ANDREA G. SHORT
|
|
Treasurer, Chief Financial Officer
|
|
February 16, 2018
|
Andrea G. Short
|
|
and Principal Accounting Officer
|
|
|
|
|
|
|
|
/s/ JOHN B. GRIFFITH
|
|
Secretary
|
|
February 16, 2018
|
John B. Griffith
|
|
and General Counsel
|
|
|
|
|
|
|
|
/s/ ALLISON N. EGIDI
|
|
Director
|
|
February 16, 2018
|
Allison N. Egidi
|
|
|
|
|
|
|
|
|
|
/s/ DANIEL B. FITZPATRICK
|
|
Director
|
|
February 16, 2018
|
Daniel B. Fitzpatrick
|
|
|
|
|
|
|
|
|
|
/s/ CRAIG A. KAPSON
|
|
Director
|
|
February 16, 2018
|
Craig A. Kapson
|
|
|
|
|
|
|
|
|
|
/s/ NAJEEB A. KHAN
|
|
Director
|
|
February 16, 2018
|
Najeeb A. Khan
|
|
|
|
|
|
|
|
|
|
/s/ VINOD M. KHILNANI
|
|
Director
|
|
February 16, 2018
|
Vinod M. Khilnani
|
|
|
|
|
|
|
|
|
|
/s/ REX MARTIN
|
|
Director
|
|
February 16, 2018
|
Rex Martin
|
|
|
|
|
|
|
|
|
|
/s/ CHRISTOPHER J. MURPHY IV
|
|
Director
|
|
February 16, 2018
|
Christopher J. Murphy IV
|
|
|
|
|
|
|
|
|
|
/s/ TIMOTHY K. OZARK
|
|
Director
|
|
February 16, 2018
|
Timothy K. Ozark
|
|
|
|
|
|
|
|
|
|
/s/ JOHN T. PHAIR
|
|
Director
|
|
February 16, 2018
|
John T. Phair
|
|
|
|
|
|
|
|
|
|
/s/ MARK D. SCHWABERO
|
|
Director
|
|
February 16, 2018
|
Mark D. Schwabero
|
|
|
|
|
ii)
|
Any sale, lease, exchange or disposition of any kind or nature of any material part of the assets of 1st Source to or with a Related Person, or
|
iii)
|
Any liquidation or dissolution of 1st Source or adoption of any plan with respect thereof involving a Related Person, or
|
iv)
|
Any reclassification of securities or recapitalization of 1st Source or any transaction which has the effect, directly or indirectly, of increasing the proportionate ownership of the outstanding shares of any class of equity or convertible securities of 1st Source which is directly or indirectly owned by any Related Person.
|
(a)
|
if immediately after the right is granted, the employee owns (as defined in Sections 423 and 425(d) of the Internal Revenue Code of 1986, as amended) stock, and/or holds outstanding purchase rights to purchase stock, possessing five percent (5%) or more of the total combined voting power or value of all classes of stock of the Corporation or of any subsidiary of the Corporation; or,
|
(b)
|
the grant of any purchase right permits the employee’s rights to purchase stock under this Plan and under all other employee stock purchase plans, if any, of the Corporation or its subsidiaries, to accrue at a rate which exceeds Twenty-Five Thousand Dollars ($25,000.00) of fair market value of such stock (determined at the time such purchase right is granted) for each calendar year in which such purchase right is outstanding at any time; or
|
(c)
|
if at any time the grant of such purchase right is prohibited by applicable law or will cause the Plan not to qualify under Section 423 of the Internal Revenue Code of 1986, as amended.
|
(a)
|
The Committee shall fix the purchase price of the shares to be offered so that such price per share shall equal one hundred percent (100%) of the fair market value of a share of the Corporation’s Common Stock on the effective date of the offering. The purchase price so fixed shall be the purchase price per share to be paid by a participant for all shares purchased by the participant during the offering period. The “fair market value” of the Corporation’s Common Stock shall be determined by the Committee under any reasonable valuation method permitted under the applicable provisions of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations thereunder.
|
(b)
|
The “offering period” shall be that period of time fixed by the Committee, but not to exceed twenty-seven (27) months following the effective date of the offering.
|
(c)
|
The “entry period” shall be that period of time commencing not earlier than ninety (90) days prior to the effective date of the offering during which appropriate participation and payroll deduction forms shall be distributed to eligible employees along with such other documents as may be required, and during which such eligible employees shall have the right to elect to participate in the Plan by completing, signing, and returning such forms to the Committee not later than the close of business on the last business day prior to the effective date of the offering. Participation and payroll deduction forms not received by the Committee prior to the close of business day prior to the effective date of the offering shall not be accepted for participation in the offering made by the Corporation.
|
(d)
|
The “payroll deduction period” shall be that period within which electing participants shall make, through payroll deductions, the required payments for the shares of the Corporation’s Common Stock which said participants have elected to purchase. The payroll deduction period shall commence on or after the effective date of an offering, shall terminate not later than the expiration of the offering period, and shall be fixed for each offering by the Committee.
|
(e)
|
Each participant shall indicate on the Plan participation and/or payroll deduction forms the amount which said participant desires to be withheld from his compensation during the offering period and applied to the purchase of shares of the Corporation’s Common Stock; provided, however, the total amount to be withheld and applied during an offering period for any individual participant may not exceed twenty-five percent (25%) of such participant's annual basic rate of pay determined as of the effective date of the offering by the Committee.
|
(f)
|
A participant shall be granted the right to purchase a fixed number of whole shares of Common Stock of the Corporation, which fixed number shall be determined by the Committee as of the effective date of the offering by dividing the total amount expected to be credited to such participant’s payroll deduction account (as defined in subparagraph 6(g) hereof) (including payroll deductions and accrued interest thereon), based upon his actual rate of participation as indicated on his participation and payroll deduction forms, by the purchase price per share as determined by the Committee under subparagraph 6(a) hereof.
|
(g)
|
The participant, in his participation and/or payroll deduction forms, shall authorize the Corporation or the participating subsidiary, as the case may be, to withhold from his compensation, throughout the offering period, the amount which said participant indicated he desired to be withheld and applied to the purchase of shares of the Common Stock of the Corporation (in accordance with subparagraph 6(e) hereof). The participant, in his participation and/or payroll deduction forms, shall direct the Corporation or the participating subsidiary, as the case may be, to deposit such withheld amounts in a savings account (herein referred to as a “payroll deduction account”) to be opened for the employee with 1st Source Bank, South Bend, Indiana, or any successor bank to that institution (hereinafter called the “Bank”) pursuant to directions set forth in said participation and/or payroll deduction forms. The employee shall further agree in the participation and/or payroll forms that he shall only withdraw and be paid the funds so accumulated in said payroll deduction forms. If required by local law or regulation, payroll deduction accounts may be opened at foreign branches of the Bank, or at other banks approved by the Corporation; such payroll deduction accounts shall be maintained and bear interest in accordance with local practice.
|
(a)
|
To cancel his participation and receive all payroll deductions and accrued interest in said participant’s payroll deduction account as soon as practicable following such notice or as soon as practicable following expiration of the offering period, as he may elect. Upon receipt of a notice of cancellation by the Committee, the participant’s purchase rights shall immediately lapse, and no further payroll deduction shall be made from his pay during the offering period. Partial withdrawals of payroll deductions may not be made.
|
(b)
|
To discontinue further payroll deductions and have the balance in his payroll deduction account applied as of the expiration of the offering period to the purchase of the maximum number of whole shares of Common Stock as may then be purchased, subject to the applicable limitations under subparagraph 6(f) hereof, in which event his purchase rights shall be permitted to lapse to the extent consistent with his election.
|
(c)
|
To elect to purchase on the last business day of the month following the date of his written notice under this Paragraph 7, all or fewer than all of the shares of which said participant is entitled to purchase under the offering as provided in subparagraph 6(f) hereof. Payment for said shares of Common Stock so purchased shall be made by the application of the balance of said participant’s payroll deduction, account plus the payment of cash or certified check, if necessary. Said payment shall be delivered to the Committee or a representative thereof on the last business day of the month following said participant’s written notice. As soon as practicable following the participant’s purchase of shares in accordance with this subparagraph 7(c), the balance in said participant’s payroll deduction account, if any, shall be paid to said participant.
|
(a)
|
In the event that the employment by the Corporation or a participating subsidiary of an employee who was a participant under the Plan shall terminate other than by reason of said participant’s death prior to the expiration of an offering period and prior to said participant making an election under Paragraph 7 hereof, said participant shall have the right within thirty (30) days from the date of said termination (unless the expiration of the offering period shall first occur, in which event such right may be exercised only on or prior to the expiration of said offering period) to elect to purchase, by written notice to the Committee, all or fewer than all of the shares said participant is entitled to purchase under the offering as provided in subparagraph 6(f) hereof. Payment for said shares of Common Stock shall be made by the application of the balance of said participant’s payroll deduction account plus the payment of cash or certified check, if necessary. Said payment shall be delivered to the Committee or a representative thereof on the date of said participant’s written notice of election under this subparagraph 8(a). As soon as practicable following the payment for shares under this subparagraph 8(a), the balance in said participant's payroll deduction account, if any, shall be paid to said participant.
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(b)
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In the event that the employment by the Corporation or a participating subsidiary of an employee who is a participant under the Plan shall terminate prior to the expiration of an offering period by reason of such employee’s death, his estate, personal representative, or beneficiary shall have the right, at any time within ninety (90) days from the date of his death (unless the expiration of the offering period shall first occur, in which event such right may be exercised only on or prior to the expiration of the offering period), to elect by written notice delivered to the Committee to purchase all or fewer than all of the shares of the Common Stock which said deceased participant was entitled to purchase under the offering as provided in subparagraph 6(f) hereof. Payment for said shares of Common Stock shall be made by the application of the balance of said participant's payroll deduction account plus the payment of cash or certified check, if necessary. Said payment shall be delivered to the Committee or a representative thereof on the date of the written notice given under this subparagraph 8(b). As soon as practicable following the payment for shares under this subparagraph 8(b), the balance in said deceased participant’s payroll deduction account, if any, shall be paid to said estate, personal representative or beneficiary.
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(c)
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In the event that the employment by the Corporation or a participating subsidiary of an employee who was a participant under the Plan shall terminate for any reason, including death, and, said participant or the estate, personal representative or beneficiary of said participant shall not make an election by written notice in accordance with the provisions of subparagraphs 8(a) or 8(b) hereof, then, such participant's purchase rights shall, with respect to such offering period, automatically lapse, and the Committee shall cause the balance of such participant’s payroll deduction account to be paid to him or to his estate, personal representative or beneficiary as soon as practicable.
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(d)
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As soon as practicable after a participant or a participant’s estate, personal representative or beneficiary’s purchase of shares under this Paragraph, the Committee shall cause certificates for the number of shares of the Corporation’s Common Stock purchased hereunder to be issued to said participant or said participant’s estate, personal representative or beneficiaries fully paid and non-assessable shares.
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/s/ BKD, LLP
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1.
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I have reviewed this annual report on Form 10-K of 1st Source Corporation;
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2.
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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;
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3.
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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;
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4.
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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:
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a)
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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;
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b)
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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;
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c)
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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
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d)
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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 that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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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:
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a)
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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
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b)
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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.
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By
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/s/ CHRISTOPHER J. MURPHY III
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Christopher J. Murphy III, Chief Executive Officer
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1.
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I have reviewed this annual report on Form 10-K of 1st Source Corporation;
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2.
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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;
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3.
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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;
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4.
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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:
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a)
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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;
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b)
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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;
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c)
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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
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d)
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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 that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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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:
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a)
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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
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b)
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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.
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By
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/s/ ANDREA G. SHORT
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Andrea G. Short, Chief Financial Officer
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(1)
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The Report fully complies with the requirements of sections 13(a) or 15(d) of the Securities and Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of 1st Source.
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By
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/s/ CHRISTOPHER J. MURPHY III
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Christopher J. Murphy III, Chief Executive Officer
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(1)
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The Report fully complies with the requirements of sections 13(a) or 15(d) of the Securities and Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of 1st Source.
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By
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/s/ ANDREA G. SHORT
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Andrea G. Short, Chief Financial Officer
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