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x
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
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Maine
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01-0413282
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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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2 Elm Street, Camden, ME
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04843
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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 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
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Accelerated filer
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x
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Non-accelerated filer
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(Do not check if a smaller reporting company)
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Smaller reporting company
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Emerging growth company
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Page
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PART I
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PART II
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PART III
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PART IV
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•
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weakness in the United States economy in general and the regional and local economies within the New England region and Maine, which could result in a deterioration of credit quality, an increase in the allowance for loan losses or a reduced demand for the Company’s credit or fee-based products and services;
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•
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changes in trade, monetary, and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System;
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•
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inflation, interest rate, market, and monetary fluctuations;
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•
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competitive pressures, including continued industry consolidation and the increased financial services provided by non-banks;
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•
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volatility in the securities markets that could adversely affect the value or credit quality of the Company’s assets, impairment of goodwill, the availability and terms of funding necessary to meet the Company’s liquidity needs, and could lead to impairment in the value of securities in the Company's investment portfolio;
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•
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changes in information technology that require increased capital spending;
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•
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changes in consumer spending and savings habits;
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•
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changes in tax, banking, securities and insurance laws and regulations; and
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•
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changes in accounting policies, practices and standards, as may be adopted by the regulatory agencies as well as the Financial Accounting Standards Board ("FASB"), and other accounting standard setters.
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•
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Camden National Wealth Management
provides a broad range of fiduciary and asset management services to both individual and institutional clients. The wealth management services provided by Camden National Wealth Management complement the services provided by the Bank, offering high net worth individuals and families, businesses and not-for profit customers investment management, financial planning and trustee services.
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•
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Camden Financial Consultants
is in the business of helping clients meet all of their financial needs. Camden Financial Consultants provides full-service brokerage and insurance and its financial offerings include college, retirement, and estate planning, mutual funds, strategic asset management accounts, and variable and fixed annuities.
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Executive Officer
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Age
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Position
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Gregory A. Dufour
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57
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President and Chief Executive Officer
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Deborah A. Jordan
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52
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Executive Vice President, Chief Operating and Financial Officer
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Joanne T. Campbell
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55
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Executive Vice President, Risk Management Officer
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Edmund M. Hayden III
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62
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Executive Vice President, Chief Credit Officer
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Timothy P. Nightingale
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60
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Executive Vice President, Senior Loan Officer
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Patricia A. Rose
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54
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Executive Vice President, Retail and Mortgage Banking Officer
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Facility Name
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Location
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General
Character of the Physical Property
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Primary Business Segment
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Property
Status
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Property
Square Feet
(1)
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Main Office
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Camden, Maine
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3 story building
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Branch and principal executive office
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Owned
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15,500
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Canal Plaza
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Portland, Maine
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2 floors
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Branch and executive office
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Leased
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16,355
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Hanley Center
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Rockport, Maine
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2 story building
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Service center
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Owned
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32,360
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Gardiner
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Gardiner, Maine
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3 story building
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Branch and service center
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Owned
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17,497
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Kennebunk
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Kennebunk, Maine
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2 story building
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Branch and service center
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Owned
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9,982
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Auburn
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Auburn, Maine
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3 story building
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Branch
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Owned
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13,000
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Bangor
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Bangor, Maine
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1 floor
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Branch
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Leased
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17,432
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Ellsworth
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Ellsworth, Maine
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3 story building
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Branch
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Owned
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44,000
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(2)
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Rockland
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Rockland, Maine
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3 story building
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Branch
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Owned
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21,600
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Waterville
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Waterville, Maine
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3 story building
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Branch
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Owned
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17,099
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(1)
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Total square footage for leased locations represents the amount of space the Company occupies.
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(2)
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Includes space leased to third parties.
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2017
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2016
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Market Price
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Dividends Declared per Share
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Market Price
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Dividends Declared per Share
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High
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Low
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High
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Low
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First Quarter
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$
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44.82
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$
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40.14
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$
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0.23
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$
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28.87
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$
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25.09
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$
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0.20
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Second Quarter
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$
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44.12
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$
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40.20
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$
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0.23
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$
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29.17
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$
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26.97
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$
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0.20
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Third Quarter
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$
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44.40
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$
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37.33
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$
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0.23
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$
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32.32
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$
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27.91
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$
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0.20
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Fourth Quarter
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$
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47.00
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$
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41.70
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$
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0.25
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$
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45.24
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$
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29.70
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$
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0.23
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Issuer's Purchases of Equity Securities
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Period
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Total
number of
shares (or units)
purchased
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Average
price paid
per share (or unit)
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Total number of
shares (or units) purchased
as part of publicly
announced plans or programs
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Maximum number (or appropriate dollar value) of shares (or units) that may yet be purchased under the plans or programs
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01/01/2017 to 12/31/2017
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—
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—
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—
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750
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Total
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—
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$
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—
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—
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750
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At or For The Year Ended
December 31,
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||||||||||||||||||
(In Thousands, Except per Share Data)
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2017
(1)
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2016
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2015
(2)
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2014
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2013
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Financial Condition Data
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Investments
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$
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907,642
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$
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897,679
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$
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855,995
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$
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803,633
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$
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828,201
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Loans and loans held for sale
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2,790,542
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2,609,400
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2,501,164
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1,772,610
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1,580,402
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Allowance for loan losses
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(24,171
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)
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(23,116
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)
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(21,166
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)
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(21,116
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)
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(21,590
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)
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Total assets
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4,065,398
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3,864,230
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3,709,344
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2,789,853
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2,603,829
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Deposits
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3,000,491
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2,828,529
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2,726,379
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1,932,097
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1,813,824
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Borrowings
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611,498
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599,675
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572,362
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577,002
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530,092
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Shareholders’ equity
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403,413
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391,547
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363,190
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245,109
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231,096
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Operating Data
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Net interest income
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$
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115,300
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$
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113,072
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$
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86,452
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$
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76,257
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$
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75,441
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Provision for credit losses
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3,035
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5,258
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1,936
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2,220
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2,028
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Non-interest income
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38,599
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39,621
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27,482
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24,370
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27,835
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Non-interest expense
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88,510
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89,896
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81,139
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62,397
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66,333
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Income before income taxes
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62,354
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57,539
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30,859
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36,010
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34,915
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Income taxes
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33,878
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17,472
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9,907
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11,440
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12,132
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Net income
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$
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28,476
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$
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40,067
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$
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20,952
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$
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24,570
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$
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22,783
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Ratios
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Return on average assets
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0.71
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%
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1.04
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%
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0.70
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%
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0.92
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%
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0.88
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%
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|||||
Return on average equity
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7.00
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%
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10.47
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%
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7.54
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%
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10.37
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%
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9.74
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%
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|||||
Net interest margin (fully-taxable equivalent)
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3.23
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%
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3.32
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%
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3.19
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%
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3.11
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%
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3.20
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%
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|||||
Tier I leverage capital ratio
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9.07
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%
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8.83
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%
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8.74
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%
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9.26
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%
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9.43
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%
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|||||
Total risk-based capital ratio
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14.14
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%
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14.04
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%
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12.98
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%
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15.16
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%
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16.45
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%
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Non-performing assets to total assets
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0.50
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%
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0.67
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%
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0.66
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%
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0.82
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%
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1.18
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%
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|||||
Dividend payout ratio
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51.43
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%
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32.22
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%
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50.60
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%
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33.73
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%
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36.30
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%
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Per common share data
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||||||||||
Basic earnings per share
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$
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1.83
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$
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2.59
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$
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1.73
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$
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2.19
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$
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1.98
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Diluted earnings per share
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1.82
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2.57
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1.73
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2.19
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1.98
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|||||
Dividends declared per share
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0.94
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0.83
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0.80
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0.74
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0.72
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Book value per share
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25.99
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25.30
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23.69
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22.00
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20.33
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|||||
Non-GAAP measures
(3)
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Adjusted net income
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$
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42,739
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$
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40,630
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$
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28,189
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$
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24,570
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$
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24,074
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Adjusted diluted earnings per share
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2.73
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2.61
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2.33
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2.19
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2.09
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Tangible book value per share
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19.57
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18.74
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16.89
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17.68
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15.99
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|||||
Efficiency ratio
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57.05
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%
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57.53
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%
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61.13
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%
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61.58
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%
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|
62.78
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%
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|||||
Adjusted return on average assets
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1.07
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%
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1.06
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%
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0.94
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%
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0.92
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%
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0.94
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%
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|||||
Return on average tangible equity
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9.69
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%
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14.76
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%
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9.91
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%
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13.46
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%
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14.55
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%
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|||||
Adjusted return on average tangible equity
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14.35
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%
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14.95
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%
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13.20
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%
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13.30
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%
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|
13.42
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%
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|||||
Tangible common equity ratio
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7.66
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%
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|
7.71
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%
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|
7.18
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%
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7.18
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%
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7.12
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%
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(1)
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In December 2017, the Tax Cuts and Jobs Act of 2017 was enacted, and the Company recognized a $14.3 million write-down of its deferred tax assets and liabilities upon revaluation using the lower federal corporate income tax rate of 21.0%.
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(2)
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On October 16, 2015, the Company completed its acquisition of SBM. The impact of the acquisition is included within the presented financial data and results as of and for the year ended December 31, 2015.
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(3)
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Refer to
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations—Non-GAAP Financial Measures and Reconciliation to GAAP
for discussion and reconciliations of non-GAAP measures.
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AFS:
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Available-for-sale
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HPFC:
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Healthcare Professional Funding Corporation, a wholly-owned subsidiary of Camden National Bank
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ALCO:
|
Asset/Liability Committee
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|
HTM:
|
Held-to-maturity
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ALL:
|
Allowance for loan losses
|
|
IRS:
|
Internal Revenue Service
|
AOCI:
|
Accumulated other comprehensive income (loss)
|
|
LIBOR:
|
London Interbank Offered Rate
|
ASC:
|
Accounting Standards Codification
|
|
LTIP:
|
Long-Term Performance Share Plan
|
ASU:
|
Accounting Standards Update
|
|
Management ALCO:
|
Management Asset/Liability Committee
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Bank:
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Camden National Bank, a wholly-owned subsidiary of Camden National Corporation
|
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MBS:
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Mortgage-backed security
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BOLI:
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Bank-owned life insurance
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MSPP:
|
Management Stock Purchase Plan
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Board ALCO:
|
Board of Directors' Asset/Liability Committee
|
|
N.M.:
|
Not meaningful
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CCTA:
|
Camden Capital Trust A, an unconsolidated entity formed by Camden National Corporation
|
|
OCC:
|
Office of the Comptroller of the Currency
|
CDs:
|
Certificate of deposits
|
|
OCI:
|
Other comprehensive income (loss)
|
Company:
|
Camden National Corporation
|
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OREO:
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Other real estate owned
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CMO:
|
Collateralized mortgage obligation
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OTTI:
|
Other-than-temporary impairment
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DCRP:
|
Defined Contribution Retirement Plan
|
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SBM:
|
SBM Financial, Inc., the parent company of The Bank of Maine
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EPS:
|
Earnings per share
|
|
SERP:
|
Supplemental executive retirement plans
|
FASB:
|
Financial Accounting Standards Board
|
|
Tax Act:
|
Tax Cuts and Jobs Act of 2017, enacted on December 22, 2017
|
FDIC:
|
Federal Deposit Insurance Corporation
|
|
TDR:
|
Troubled-debt restructured loan
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FHLB:
|
Federal Home Loan Bank
|
|
UBCT:
|
Union Bankshares Capital Trust I, an unconsolidated entity formed by Union Bankshares Company that was subsequently acquired by Camden National Corporation
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FHLBB:
|
Federal Home Loan Bank of Boston
|
|
U.S.:
|
United States of America
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FRB:
|
Federal Reserve System Board of Governors
|
|
2003 Plan:
|
2003 Stock Option and Incentive Plan
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FRBB:
|
Federal Reserve Bank of Boston
|
|
2012 Plan:
|
2012 Equity and Incentive Plan
|
GAAP:
|
Generally accepted accounting principles in the United States
|
|
|
|
•
|
Loan Growth of 7%—
Our loan portfolio grew 7% to $2.8 billion at December 31, 2017, led by commercial real estate loan growth of 11%, followed by residential mortgage growth of 7% and commercial loan growth of 6%.
|
•
|
Low Cost Deposit Growth of 11% —
Our total deposit base grew 6% to $3.0 billion at December 31, 2017, led by low cost deposits (demand, interest checking, savings and money market) growth of 11%.
|
•
|
Strong Asset Quality —
Strong asset quality metrics resulted in a 42% decrease in our provision for credit losses to $3.0 million for 2017. Our non-performing assets to total assets ratio decreased to 0.50% at December 31, 2017, compared to 0.67% at December 31, 2016, while our net charge-offs to average loans ratio for 2017 of 0.07%, compared to 0.13% for 2016.
|
1
|
The following was not calculated in accordance with GAAP. Refer to the "
— Non-GAAP Financial Measures and Reconciliation to GAAP"
within
Item 7
.
|
1
|
The following was not calculated in accordance with GAAP. Refer to the "
— Non-GAAP Financial Measures and Reconciliation to GAAP"
within
Item 7
.
|
1
|
The following was not calculated in accordance with GAAP. Refer to the "
— Non-GAAP Financial Measures and Reconciliation to GAAP"
within
Item 7
.
|
|
|
For The Year Ended
December 31,
|
||||||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
Adjusted Net Income:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income, as presented
|
|
$
|
28,476
|
|
|
$
|
40,067
|
|
|
$
|
20,952
|
|
|
$
|
24,570
|
|
|
$
|
22,783
|
|
Add: impact of the Tax Act
|
|
14,263
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Add: merger and acquisition costs and divestiture costs, net of tax
(1)
|
|
—
|
|
|
563
|
|
|
7,237
|
|
|
—
|
|
|
243
|
|
|||||
Add: goodwill impairment
(1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,830
|
|
|||||
Less: gain on branch divestiture and sale
(1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,782
|
)
|
|||||
Adjusted net income
|
|
$
|
42,739
|
|
|
$
|
40,630
|
|
|
$
|
28,189
|
|
|
$
|
24,570
|
|
|
$
|
24,074
|
|
Adjusted Diluted EPS:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Diluted EPS, as presented
|
|
$
|
1.82
|
|
|
$
|
2.57
|
|
|
$
|
1.73
|
|
|
$
|
2.19
|
|
|
$
|
1.98
|
|
Impact of adjustments to arrive at adjusted net income
|
|
0.91
|
|
|
0.04
|
|
|
0.60
|
|
|
—
|
|
|
0.11
|
|
|||||
Adjusted diluted EPS
|
|
$
|
2.73
|
|
|
$
|
2.61
|
|
|
$
|
2.33
|
|
|
$
|
2.19
|
|
|
$
|
2.09
|
|
Adjusted Return on Average Assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Return on average assets, as presented
|
|
0.71
|
%
|
|
1.04
|
%
|
|
0.70
|
%
|
|
0.92
|
%
|
|
0.88
|
%
|
|||||
Impact of adjustments to arrive at adjusted net income
|
|
0.36
|
%
|
|
0.02
|
%
|
|
0.24
|
%
|
|
—
|
%
|
|
0.06
|
%
|
|||||
Adjusted return on average assets
|
|
1.07
|
%
|
|
1.06
|
%
|
|
0.94
|
%
|
|
0.92
|
%
|
|
0.94
|
%
|
(1)
|
Assumed a 35% tax rate for deductible expenses, with the exception of goodwill impairment as this was a non-taxable event.
|
|
|
For The Year Ended
December 31,
|
||||||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
Net income, as presented
|
|
$
|
28,476
|
|
|
$
|
40,067
|
|
|
$
|
20,952
|
|
|
$
|
24,570
|
|
|
$
|
22,783
|
|
Add: impact of the Tax Act
|
|
14,263
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Add: merger and acquisition costs and divestiture costs, net of tax
(1)
|
|
—
|
|
|
563
|
|
|
7,237
|
|
|
—
|
|
|
243
|
|
|||||
Add: goodwill impairment
(1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,830
|
|
|||||
Less: gain on branch divestiture and sale
(1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,782
|
)
|
|||||
Adjusted net income
|
|
$
|
42,739
|
|
|
$
|
40,630
|
|
|
$
|
28,189
|
|
|
$
|
24,570
|
|
|
$
|
24,074
|
|
Add: amortization of intangible assets, net of tax
(1)
|
|
1,176
|
|
|
1,237
|
|
|
849
|
|
|
746
|
|
|
747
|
|
|||||
Add: goodwill impairment
(1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,830
|
|
|||||
Adjusted tangible net income
|
|
43,915
|
|
|
41,867
|
|
|
29,038
|
|
|
25,316
|
|
|
27,651
|
|
|||||
Average equity
|
|
$
|
406,628
|
|
|
$
|
382,507
|
|
|
$
|
277,716
|
|
|
$
|
236,849
|
|
|
$
|
233,888
|
|
Less: average goodwill and other intangible assets
|
|
(100,513
|
)
|
|
(102,711
|
)
|
|
(57,833
|
)
|
|
(48,735
|
)
|
|
(52,708
|
)
|
|||||
Average tangible equity
|
|
$
|
306,115
|
|
|
$
|
279,796
|
|
|
$
|
219,883
|
|
|
$
|
188,114
|
|
|
$
|
181,180
|
|
Adjusted return on average tangible equity
|
|
14.35
|
%
|
|
14.96
|
%
|
|
13.21
|
%
|
|
13.46
|
%
|
|
15.26
|
%
|
|||||
Adjusted return on average equity
|
|
10.51
|
%
|
|
10.62
|
%
|
|
10.15
|
%
|
|
10.37
|
%
|
|
10.29
|
%
|
|||||
Return on average equity
|
|
7.00
|
%
|
|
10.47
|
%
|
|
7.54
|
%
|
|
10.37
|
%
|
|
9.74
|
%
|
(1)
|
Assumed a 35.0% tax rate for deductible expenses, with the exception of goodwill impairment as this was a non-taxable event.
|
|
|
For The Year Ended
December 31,
|
||||||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
Non-interest expense, as presented
|
|
$
|
88,510
|
|
|
$
|
89,896
|
|
|
$
|
81,139
|
|
|
$
|
62,397
|
|
|
$
|
66,333
|
|
Less: merger and acquisition costs, and divestiture cost
|
|
—
|
|
|
(866
|
)
|
|
(10,415
|
)
|
|
—
|
|
|
(374
|
)
|
|||||
Less: goodwill impairment
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,830
|
)
|
|||||
Adjusted non-interest expense
|
|
$
|
88,510
|
|
|
$
|
89,030
|
|
|
$
|
70,724
|
|
|
$
|
62,397
|
|
|
$
|
63,129
|
|
Net interest income, as presented
|
|
$
|
115,300
|
|
|
$
|
113,072
|
|
|
$
|
86,452
|
|
|
$
|
76,257
|
|
|
$
|
75,441
|
|
Add: effect of tax-exempt income
|
|
2,105
|
|
|
2,121
|
|
|
1,763
|
|
|
1,157
|
|
|
808
|
|
|||||
Non-interest income
|
|
38,599
|
|
|
39,621
|
|
|
27,482
|
|
|
24,370
|
|
|
27,835
|
|
|||||
Less: net gains on sale of securities, net of OTTI
|
|
(855
|
)
|
|
(51
|
)
|
|
(4
|
)
|
|
(451
|
)
|
|
(785
|
)
|
|||||
Less: gain on branch divestiture and sale
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,742
|
)
|
|||||
Adjusted net interest income plus non-interest income
|
|
$
|
155,149
|
|
|
$
|
154,763
|
|
|
$
|
115,693
|
|
|
$
|
101,333
|
|
|
$
|
100,557
|
|
Efficiency ratio
|
|
57.05
|
%
|
|
57.53
|
%
|
|
61.13
|
%
|
|
61.58
|
%
|
|
62.78
|
%
|
|||||
Non-interest expense, as presented, to total revenues
(1)
|
|
57.51
|
%
|
|
58.87
|
%
|
|
71.22
|
%
|
|
62.01
|
%
|
|
64.23
|
%
|
(1)
|
Revenue is defined as net interest income plus non-interest income.
|
|
|
For The Year Ended
December 31,
|
||||||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
Net interest income, as presented
|
|
$
|
115,300
|
|
|
$
|
113,072
|
|
|
$
|
86,452
|
|
|
$
|
76,257
|
|
|
$
|
75,441
|
|
Effect of tax-exempt income
|
|
2,105
|
|
|
2,121
|
|
|
1,763
|
|
|
1,157
|
|
|
808
|
|
|||||
Net interest income, tax equivalent
|
|
$
|
117,405
|
|
|
$
|
115,193
|
|
|
$
|
88,215
|
|
|
$
|
77,414
|
|
|
$
|
76,249
|
|
|
|
December 31,
|
||||||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
Tangible Book Value Per Share:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Shareholders' equity, as presented
|
|
$
|
403,413
|
|
|
$
|
391,547
|
|
|
$
|
363,190
|
|
|
$
|
245,109
|
|
|
$
|
231,096
|
|
Less: goodwill and other intangible assets
|
|
(99,652
|
)
|
|
(101,461
|
)
|
|
(104,324
|
)
|
|
(48,171
|
)
|
|
(49,319
|
)
|
|||||
Tangible equity
|
|
$
|
303,761
|
|
|
$
|
290,086
|
|
|
$
|
258,866
|
|
|
$
|
196,938
|
|
|
$
|
181,777
|
|
Shares outstanding at period end
|
|
15,524,704
|
|
|
15,476,379
|
|
|
15,330,717
|
|
|
11,139,333
|
|
|
11,369,870
|
|
|||||
Tangible book value per share
|
|
$
|
19.57
|
|
|
$
|
18.74
|
|
|
$
|
16.89
|
|
|
$
|
17.68
|
|
|
$
|
15.99
|
|
Book value per share
|
|
$
|
25.99
|
|
|
$
|
25.30
|
|
|
$
|
23.69
|
|
|
$
|
22.00
|
|
|
$
|
20.33
|
|
Tangible Common Equity Ratio:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total assets
|
|
$
|
4,065,398
|
|
|
$
|
3,864,230
|
|
|
$
|
3,709,344
|
|
|
$
|
2,789,853
|
|
|
$
|
2,603,829
|
|
Less: goodwill and other intangibles
|
|
(99,652
|
)
|
|
(101,461
|
)
|
|
(104,324
|
)
|
|
(48,171
|
)
|
|
(49,319
|
)
|
|||||
Tangible assets
|
|
$
|
3,965,746
|
|
|
$
|
3,762,769
|
|
|
$
|
3,605,020
|
|
|
$
|
2,741,682
|
|
|
$
|
2,554,510
|
|
Tangible common equity ratio
|
|
7.66
|
%
|
|
7.71
|
%
|
|
7.18
|
%
|
|
7.18
|
%
|
|
7.12
|
%
|
|||||
Shareholders' equity to total assets
|
|
9.92
|
%
|
|
10.13
|
%
|
|
9.79
|
%
|
|
8.79
|
%
|
|
8.88
|
%
|
•
|
Net interest income on a fully-taxable equivalent basis for the year ended December 31, 2017 was $114.2 million, representing an increase of $5.2 million, or 5% over 2016.
|
•
|
Net interest margin for the year ended December 31, 2017 decreased 1 basis point to 3.14% compared to 2016.
|
•
|
Commercial real estate and commercial loan growth of $116.4 million, or 12%, and $44.0 million, or 15%, respectively.
|
•
|
The retail loan portfolio (including residential real estate, consumer and home equity loans) increased less than 1%.
|
•
|
HPFC loans continue to wind-down after our announcement in 2016 that HPFC is no longer originating loans, and, for 2017, average loan balances decreased $18.2 million to $52.0 million.
|
•
|
Average investment securities balances increased $29.0 million, or 3%, to $928.6 million.
|
|
|
Average Balance, Interest and Yield/Rate Analysis
|
|||||||||||||||||||||||||||||||
|
|
For The Year Ended
December 31,
|
|||||||||||||||||||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||||||||||||||
|
|
Average Balance
|
|
Interest
|
|
Yield/Rate
|
|
Average Balance
|
|
Interest
|
|
Yield/Rate
|
|
Average Balance
|
|
Interest
|
|
Yield/Rate
|
|||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Interest-earning assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Securities – taxable
|
|
$
|
826,749
|
|
|
$
|
18,777
|
|
|
2.27
|
%
|
|
$
|
796,423
|
|
|
$
|
17,566
|
|
|
2.21
|
%
|
|
$
|
739,168
|
|
|
$
|
15,715
|
|
|
2.13
|
%
|
Securities – nontaxable
(1)
|
|
101,898
|
|
|
4,253
|
|
|
4.17
|
%
|
|
103,086
|
|
|
4,363
|
|
|
4.23
|
%
|
|
76,779
|
|
|
3,397
|
|
|
4.42
|
%
|
||||||
Loans
(2)
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Residential real estate
|
|
838,781
|
|
|
34,517
|
|
|
4.12
|
%
|
|
822,690
|
|
|
34,366
|
|
|
4.18
|
%
|
|
636,516
|
|
|
26,505
|
|
|
4.16
|
%
|
||||||
Commercial real estate
(3)
|
|
1,120,591
|
|
|
46,080
|
|
|
4.11
|
%
|
|
1,004,169
|
|
|
41,228
|
|
|
4.11
|
%
|
|
716,112
|
|
|
31,859
|
|
|
4.45
|
%
|
||||||
Commercial
(1)
|
|
336,685
|
|
|
14,180
|
|
|
4.21
|
%
|
|
292,709
|
|
|
12,350
|
|
|
4.22
|
%
|
|
254,514
|
|
|
9,726
|
|
|
3.82
|
%
|
||||||
Municipal
(1)
|
|
19,428
|
|
|
667
|
|
|
3.43
|
%
|
|
19,238
|
|
|
572
|
|
|
2.97
|
%
|
|
13,698
|
|
|
471
|
|
|
3.44
|
%
|
||||||
Consumer
|
|
343,457
|
|
|
15,294
|
|
|
4.45
|
%
|
|
358,098
|
|
|
15,111
|
|
|
4.22
|
%
|
|
310,664
|
|
|
12,053
|
|
|
3.88
|
%
|
||||||
HPFC
|
|
52,031
|
|
|
4,441
|
|
|
8.53
|
%
|
|
70,188
|
|
|
6,191
|
|
|
8.82
|
%
|
|
17,117
|
|
|
1,181
|
|
|
6.90
|
%
|
||||||
Total loans
|
|
2,710,973
|
|
|
115,179
|
|
|
4.25
|
%
|
|
2,567,092
|
|
|
109,818
|
|
|
4.28
|
%
|
|
1,948,621
|
|
|
81,795
|
|
|
4.20
|
%
|
||||||
Total interest-earning assets
|
|
3,639,620
|
|
|
138,209
|
|
|
3.80
|
%
|
|
3,466,601
|
|
|
131,747
|
|
|
3.80
|
%
|
|
2,764,568
|
|
|
100,907
|
|
|
3.65
|
%
|
||||||
Cash and due from banks
|
|
85,289
|
|
|
|
|
|
|
|
|
87,319
|
|
|
|
|
|
|
|
|
55,256
|
|
|
|
|
|
|
|
||||||
Other assets
|
|
287,765
|
|
|
|
|
|
|
|
|
305,440
|
|
|
|
|
|
|
|
|
200,857
|
|
|
|
|
|
|
|
||||||
Less: ALL
|
|
(24,068
|
)
|
|
|
|
|
|
(22,663
|
)
|
|
|
|
|
|
(21,281
|
)
|
|
|
|
|
||||||||||||
Total assets
|
|
$
|
3,988,606
|
|
|
|
|
|
|
$
|
3,836,697
|
|
|
|
|
|
|
$
|
2,999,400
|
|
|
|
|
|
|||||||||
LIABILITIES & SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Deposits:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Demand
|
|
$
|
430,706
|
|
|
$
|
—
|
|
|
—
|
%
|
|
$
|
386,189
|
|
|
$
|
—
|
|
|
—
|
%
|
|
$
|
292,776
|
|
|
$
|
—
|
|
|
—
|
%
|
Interest checking
|
|
750,543
|
|
|
1,541
|
|
|
0.21
|
%
|
|
724,222
|
|
|
921
|
|
|
0.13
|
%
|
|
543,330
|
|
|
427
|
|
|
0.08
|
%
|
||||||
Savings
|
|
492,483
|
|
|
310
|
|
|
0.06
|
%
|
|
461,794
|
|
|
278
|
|
|
0.06
|
%
|
|
306,536
|
|
|
180
|
|
|
0.06
|
%
|
||||||
Money market
|
|
480,119
|
|
|
2,475
|
|
|
0.52
|
%
|
|
490,155
|
|
|
2,053
|
|
|
0.42
|
%
|
|
394,367
|
|
|
1,283
|
|
|
0.33
|
%
|
||||||
Certificates of deposit
|
|
466,418
|
|
|
4,124
|
|
|
0.88
|
%
|
|
489,040
|
|
|
3,793
|
|
|
0.78
|
%
|
|
357,972
|
|
|
3,126
|
|
|
0.87
|
%
|
||||||
Total deposits
|
|
2,620,269
|
|
|
8,450
|
|
|
0.32
|
%
|
|
2,551,400
|
|
|
7,045
|
|
|
0.28
|
%
|
|
1,894,981
|
|
|
5,016
|
|
|
0.26
|
%
|
||||||
Borrowings:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Brokered deposits
|
|
296,261
|
|
|
3,361
|
|
|
1.13
|
%
|
|
231,610
|
|
|
1,588
|
|
|
0.69
|
%
|
|
229,079
|
|
|
1,495
|
|
|
0.65
|
%
|
||||||
Retail repurchase agreements
|
|
232,762
|
|
|
1,070
|
|
|
0.46
|
%
|
|
198,403
|
|
|
555
|
|
|
0.28
|
%
|
|
153,101
|
|
|
304
|
|
|
0.20
|
%
|
||||||
Subordinated debentures
|
|
58,834
|
|
|
3,408
|
|
|
5.79
|
%
|
|
58,718
|
|
|
3,415
|
|
|
5.82
|
%
|
|
47,569
|
|
|
2,724
|
|
|
5.73
|
%
|
||||||
Other borrowings
|
|
329,988
|
|
|
4,515
|
|
|
1.37
|
%
|
|
359,281
|
|
|
3,951
|
|
|
1.10
|
%
|
|
358,531
|
|
|
3,153
|
|
|
0.88
|
%
|
||||||
Total borrowings
|
|
917,845
|
|
|
12,354
|
|
|
1.35
|
%
|
|
848,012
|
|
|
9,509
|
|
|
1.12
|
%
|
|
788,280
|
|
|
7,676
|
|
|
0.97
|
%
|
||||||
Total funding liabilities
|
|
3,538,114
|
|
|
20,804
|
|
|
0.59
|
%
|
|
3,399,412
|
|
|
16,554
|
|
|
0.49
|
%
|
|
2,683,261
|
|
|
12,692
|
|
|
0.47
|
%
|
||||||
Other liabilities
|
|
43,864
|
|
|
|
|
|
|
|
|
54,778
|
|
|
|
|
|
|
|
|
38,423
|
|
|
|
|
|
|
|
||||||
Shareholders’ equity
|
|
406,628
|
|
|
|
|
|
|
382,507
|
|
|
|
|
|
|
277,716
|
|
|
|
|
|
||||||||||||
Total liabilities and shareholders’ equity
|
|
$
|
3,988,606
|
|
|
|
|
|
|
$
|
3,836,697
|
|
|
|
|
|
|
$
|
2,999,400
|
|
|
|
|
|
|||||||||
Net interest income (fully-taxable equivalent)
|
|
|
|
|
117,405
|
|
|
|
|
|
|
|
|
115,193
|
|
|
|
|
|
|
|
|
88,215
|
|
|
|
|
||||||
Less: fully-taxable equivalent adjustment
|
|
|
|
(2,105
|
)
|
|
|
|
|
|
(2,121
|
)
|
|
|
|
|
|
(1,763
|
)
|
|
|
||||||||||||
Net interest income
|
|
|
|
$
|
115,300
|
|
|
|
|
|
|
|
$
|
113,072
|
|
|
|
|
|
|
$
|
86,452
|
|
|
|
||||||||
Net interest rate spread (fully-taxable equivalent)
|
|
|
|
|
|
3.21
|
%
|
|
|
|
|
|
3.31
|
%
|
|
|
|
|
|
3.18
|
%
|
||||||||||||
Net interest margin (fully-taxable equivalent)
|
|
|
|
|
|
3.23
|
%
|
|
|
|
|
|
3.32
|
%
|
|
|
|
|
|
3.19
|
%
|
||||||||||||
Net interest margin (fully-taxable equivalent), excluding fair value mark accretion and collection of previously charged-off acquired loans
|
|
|
|
|
|
3.14
|
%
|
|
|
|
|
|
3.15
|
%
|
|
|
|
|
|
3.16
|
%
|
|
|
December 31, 2017 vs. 2016
Increase (Decrease) Due to:
|
|
December 31, 2016 vs. 2015
Increase (Decrease) Due to:
|
||||||||||||||||||||
|
|
Volume
|
|
Rate
|
|
Net
|
|
Volume
|
|
Rate
|
|
Net
|
||||||||||||
Interest-earning assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Securities – taxable
|
|
$
|
670
|
|
|
$
|
541
|
|
|
$
|
1,211
|
|
|
$
|
1,220
|
|
|
$
|
631
|
|
|
$
|
1,851
|
|
Securities – nontaxable
|
|
(50
|
)
|
|
(60
|
)
|
|
(110
|
)
|
|
1,163
|
|
|
(197
|
)
|
|
966
|
|
||||||
Residential real estate
|
|
673
|
|
|
(522
|
)
|
|
151
|
|
|
7,745
|
|
|
116
|
|
|
7,861
|
|
||||||
Commercial real estate
|
|
4,785
|
|
|
67
|
|
|
4,852
|
|
|
12,819
|
|
|
(3,450
|
)
|
|
9,369
|
|
||||||
Commercial
|
|
1,856
|
|
|
(26
|
)
|
|
1,830
|
|
|
1,459
|
|
|
1,165
|
|
|
2,624
|
|
||||||
Municipal
|
|
6
|
|
|
89
|
|
|
95
|
|
|
191
|
|
|
(90
|
)
|
|
101
|
|
||||||
Consumer
|
|
(618
|
)
|
|
801
|
|
|
183
|
|
|
1,840
|
|
|
1,218
|
|
|
3,058
|
|
||||||
HPFC
|
|
(1,601
|
)
|
|
(149
|
)
|
|
(1,750
|
)
|
|
3,662
|
|
|
1,348
|
|
|
5,010
|
|
||||||
Total interest income
|
|
5,721
|
|
|
741
|
|
|
6,462
|
|
|
30,099
|
|
|
741
|
|
|
30,840
|
|
||||||
Interest-bearing liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest checking
|
|
34
|
|
|
586
|
|
|
620
|
|
|
145
|
|
|
349
|
|
|
494
|
|
||||||
Savings
|
|
18
|
|
|
14
|
|
|
32
|
|
|
93
|
|
|
5
|
|
|
98
|
|
||||||
Money market
|
|
(42
|
)
|
|
464
|
|
|
422
|
|
|
316
|
|
|
454
|
|
|
770
|
|
||||||
Certificates of deposit
|
|
(176
|
)
|
|
507
|
|
|
331
|
|
|
1,140
|
|
|
(473
|
)
|
|
667
|
|
||||||
Brokered deposits
|
|
446
|
|
|
1,327
|
|
|
1,773
|
|
|
16
|
|
|
77
|
|
|
93
|
|
||||||
Customer repurchase agreements
|
|
96
|
|
|
419
|
|
|
515
|
|
|
91
|
|
|
160
|
|
|
251
|
|
||||||
Subordinated debentures
|
|
7
|
|
|
(14
|
)
|
|
(7
|
)
|
|
639
|
|
|
52
|
|
|
691
|
|
||||||
Other borrowings
|
|
(322
|
)
|
|
886
|
|
|
564
|
|
|
7
|
|
|
791
|
|
|
798
|
|
||||||
Total interest expense
|
|
61
|
|
|
4,189
|
|
|
4,250
|
|
|
2,447
|
|
|
1,415
|
|
|
3,862
|
|
||||||
Net interest income (fully-taxable equivalent)
|
|
$
|
5,660
|
|
|
$
|
(3,448
|
)
|
|
$
|
2,212
|
|
|
$
|
27,652
|
|
|
$
|
(674
|
)
|
|
$
|
26,978
|
|
|
|
Income Statement Location
|
|
For The Year Ended
December 31,
|
||||||||||
|
|
|
2017
|
|
2016
|
|
2015
|
|||||||
Loan fees (cost)
|
|
Interest income
|
|
$
|
(209
|
)
|
|
$
|
(394
|
)
|
|
$
|
735
|
|
Net fair value mark accretion from purchase accounting
|
|
Interest income and Interest expense
|
|
2,837
|
|
|
5,082
|
|
|
812
|
|
|||
Recoveries on previously charged-off acquired loans
|
|
Interest income
|
|
320
|
|
|
1,078
|
|
|
52
|
|
|||
Total
|
|
|
|
$
|
2,948
|
|
|
$
|
5,766
|
|
|
$
|
1,599
|
|
•
|
A decrease in net charge-offs of $1.3 million, highlighted by a net charge-offs to average loans ratio for 2017 of 0.07% compared to 0.13% for 2016.
|
•
|
Overall asset quality improvement, highlighted by a decrease in non-performing loans of $4.7 million to $20.3 million, or 0.73% of total loans, compared to 0.97% of total loans at December 31, 2016.
|
•
|
Credit deterioration of two large loan relationships: (i) a syndication relationship we acquired as part of the acquisition of SBM that resulted in incremental provision expense in 2016 of $1.4 million; and (ii) a large commercial real estate loan that was downgraded from passing to substandard in 2016 that resulted in incremental provision expense for 2016 of $1.3 million. Our net charge-offs to average loans ratio for the year ended December 31, 2016 increased to 0.13% compared to 0.10% for 2015.
|
•
|
Organic loan growth of $104.4 million.
|
|
|
For The Year Ended
December 31,
|
||||||||||||||||||||||||
|
|
2017
|
|
2016
|
|
Change from
|
|
2015
|
|
Change from
|
||||||||||||||||
|
|
|
|
2017 to 2016
|
|
|
2016 to 2015
|
|||||||||||||||||||
|
|
|
|
$
|
|
%
|
|
|
$
|
|
%
|
|||||||||||||||
Debit card income
|
|
$
|
8,079
|
|
|
$
|
7,578
|
|
|
$
|
501
|
|
|
7
|
%
|
|
$
|
5,277
|
|
|
$
|
2,301
|
|
|
44
|
%
|
Service charges on deposit accounts
|
|
7,529
|
|
|
7,210
|
|
|
319
|
|
|
4
|
%
|
|
6,423
|
|
|
787
|
|
|
12
|
%
|
|||||
Mortgage banking income, net
|
|
7,363
|
|
|
6,258
|
|
|
1,105
|
|
|
18
|
%
|
|
2,031
|
|
|
4,227
|
|
|
208
|
%
|
|||||
Income from fiduciary services
|
|
5,108
|
|
|
4,960
|
|
|
148
|
|
|
3
|
%
|
|
4,918
|
|
|
42
|
|
|
1
|
%
|
|||||
Bank-owned life insurance
|
|
2,370
|
|
|
2,594
|
|
|
(224
|
)
|
|
(9
|
)%
|
|
1,680
|
|
|
914
|
|
|
54
|
%
|
|||||
Brokerage and insurance commissions
|
|
2,147
|
|
|
2,074
|
|
|
73
|
|
|
4
|
%
|
|
1,699
|
|
|
375
|
|
|
22
|
%
|
|||||
Other service charges and fees
|
|
2,029
|
|
|
1,962
|
|
|
67
|
|
|
3
|
%
|
|
1,573
|
|
|
389
|
|
|
25
|
%
|
|||||
Net gain on sale of securities
|
|
855
|
|
|
51
|
|
|
804
|
|
|
1,576
|
%
|
|
4
|
|
|
47
|
|
|
1,175
|
%
|
|||||
Other income
|
|
3,119
|
|
|
6,934
|
|
|
(3,815
|
)
|
|
(55
|
)%
|
|
3,877
|
|
|
3,057
|
|
|
79
|
%
|
|||||
Total non-interest income
|
|
$
|
38,599
|
|
|
$
|
39,621
|
|
|
$
|
(1,022
|
)
|
|
(3
|
)%
|
|
$
|
27,482
|
|
|
$
|
12,139
|
|
|
44
|
%
|
Non-interest income as a percentage of total revenues
(1)
|
|
25
|
%
|
|
26
|
%
|
|
|
|
|
|
24
|
%
|
|
|
|
|
(1)
|
Revenue is defined as net interest income plus non-interest income.
|
•
|
An increase in mortgage banking income, net of $1.1 million due to lower amortization costs on our servicing assets of $754,000 and a recognized unrealized gain of $384,000 on the change in valuation of our loans held for sale and forward commitments to investors on those loans, and fixed-rate mortgage interest rate lock commitments.
|
•
|
An increase in net gain on sale of securities of $804,000 primarily due to the sale of several small lot investment positions with a total amortized cost of $19.4 million.
|
•
|
A decrease in other income of $3.8 million was driven by: (i) non-recurring transactions in 2016 that resulted in income of $1.2 million from a legal settlement and liquidation of a mortgage insurance exchange; (ii) a decrease in loan sub-servicing income of $1.7 million upon exiting of a significant sub-servicer relationship; and (iii) a decrease in fees from customer loans swap of $530,000.
|
•
|
An increase in mortgage banking income of $4.2 million from the sale of $232.0 million of residential mortgages in 2016 that generated net gains on sale of $6.2 million compared to $61.2 million of residential mortgage sales in 2015 that generated net gains on sale of $1.3 million. The increase reflects our shift in our retail loan strategy and build-out of our mortgage banking team after the acquisition of SBM in the fourth quarter of 2015.
|
•
|
An increase in other income of $3.1 million was driven by legal settlement proceeds of $638,000 related to a previously charged-off acquired loan, higher income on customer loan swaps of $590,000, one-time proceeds of $577,000 upon liquidation of a mortgage insurance exchange, and an increase in third party loan servicing income of $514,000.
|
•
|
An increase in debit card income of $2.3 million, and an increase in service charges on deposit accounts of $787,000 and other service charges and fees of $389,000 was primarily due to the addition of new customer accounts in connection with the acquisition of SBM in the fourth quarter of 2015.
|
•
|
An increase in BOLI income due an additional investment of $16.7 million made during 2016 and income from death benefits received of $507,000.
|
|
|
For The Year Ended
December 31,
|
||||||||||||||||||||||||
|
|
2017
|
|
2016
|
|
Change from
|
|
2015
|
|
Change from
|
||||||||||||||||
|
|
|
|
2017 to 2016
|
|
|
2016 to 2015
|
|||||||||||||||||||
|
|
|
|
$
|
|
%
|
|
|
$
|
|
%
|
|||||||||||||||
Salaries and employee benefits
|
|
$
|
49,965
|
|
|
$
|
48,072
|
|
|
$
|
1,893
|
|
|
4
|
%
|
|
$
|
37,220
|
|
|
$
|
10,852
|
|
|
29
|
%
|
Furniture, equipment and data processing
|
|
9,894
|
|
|
9,557
|
|
|
337
|
|
|
4
|
%
|
|
8,057
|
|
|
1,500
|
|
|
19
|
%
|
|||||
Net occupancy
|
|
6,884
|
|
|
7,088
|
|
|
(204
|
)
|
|
(3
|
)%
|
|
5,695
|
|
|
1,393
|
|
|
24
|
%
|
|||||
Consulting and professional fees
|
|
3,118
|
|
|
3,234
|
|
|
(116
|
)
|
|
(4
|
)%
|
|
2,625
|
|
|
609
|
|
|
23
|
%
|
|||||
Debit card expense
|
|
2,755
|
|
|
2,584
|
|
|
171
|
|
|
7
|
%
|
|
1,936
|
|
|
648
|
|
|
33
|
%
|
|||||
Regulatory assessments
|
|
2,166
|
|
|
2,777
|
|
|
(611
|
)
|
|
(22
|
)%
|
|
2,184
|
|
|
593
|
|
|
27
|
%
|
|||||
Amortization of intangible assets
|
|
1,810
|
|
|
1,903
|
|
|
(93
|
)
|
|
(5
|
)%
|
|
1,306
|
|
|
597
|
|
|
46
|
%
|
|||||
OREO and collection costs
|
|
971
|
|
|
3,128
|
|
|
(2,157
|
)
|
|
(69
|
)%
|
|
2,491
|
|
|
637
|
|
|
26
|
%
|
|||||
Merger and acquisition costs
|
|
—
|
|
|
866
|
|
|
(866
|
)
|
|
(100
|
)%
|
|
10,415
|
|
|
(9,549
|
)
|
|
N.M.
|
|
|||||
Other expenses
|
|
10,947
|
|
|
10,687
|
|
|
260
|
|
|
2
|
%
|
|
9,210
|
|
|
1,477
|
|
|
16
|
%
|
|||||
Total non-interest expenses
|
|
$
|
88,510
|
|
|
$
|
89,896
|
|
|
$
|
(1,386
|
)
|
|
(2
|
)%
|
|
$
|
81,139
|
|
|
$
|
8,757
|
|
|
11
|
%
|
Efficiency ratio (non-GAAP)
(1)
|
|
57.05
|
%
|
|
57.53
|
%
|
|
|
|
|
|
61.13
|
%
|
|
|
|
|
(1)
|
Refer to
"—Non-GAAP Financial Measures and Reconciliation to GAAP"
for details of calculation.
|
•
|
An increase in salary and employee benefits costs of $1.9 million, or 4%, driven by normal merit increases, higher bonus and incentive costs of $446,000 based on the Company's 2017 financial performance and a special cash bonus to all non-executive employees, and rising health insurance and related benefit premiums of $757,000.
|
•
|
A decrease in OREO and collection costs of $2.2 million driven by lower sub-servicer costs of $1.9 million as a result of exiting a significant sub-servicer relationship, effective December 31, 2016.
|
•
|
A decrease in regulatory assessments fees of $611,000 driven by the change in the FDIC fee structure that went into effect in the second half of 2016 that reduced our assessment rate.
|
•
|
A decrease in merger and acquisition costs of $866,000.
|
•
|
A decrease in merger and acquisition costs associated with the acquisition of SBM of $9.5 million as the acquisition occurred in the fourth quarter of 2015.
|
•
|
An increase in OREO and collections costs due to an increase in third party servicing costs and collection-related costs of $1.1 million, partially offset by lower OREO-related costs of $446,000 as our inventory of OREO properties decreased from nine at December 31, 2015 to six at December 31, 2016.
|
•
|
An increase in bonuses and incentives of $931,000 due to the successful integration of SBM, and a strong financial performance for 2016.
|
|
|
Debt
|
|
Equity
|
|
|
||||||||||||||||||||||
|
|
AFS
|
|
HTM
|
|
Total
|
|
AFS
|
|
Cost
|
|
Total
|
|
Total
|
||||||||||||||
Carrying value at January 1, 2017
|
|
$
|
779,126
|
|
|
$
|
94,609
|
|
|
$
|
873,735
|
|
|
$
|
741
|
|
|
$
|
23,203
|
|
|
$
|
23,944
|
|
|
$
|
897,679
|
|
Purchases
|
|
170,495
|
|
|
—
|
|
|
170,495
|
|
|
—
|
|
|
12,290
|
|
|
12,290
|
|
|
182,785
|
|
|||||||
Sales, carrying value
|
|
(19,433
|
)
|
|
—
|
|
|
(19,433
|
)
|
|
(78
|
)
|
|
(11,823
|
)
|
|
(11,901
|
)
|
|
(31,334
|
)
|
|||||||
Principal repayments, maturities and calls
|
|
(134,607
|
)
|
|
—
|
|
|
(134,607
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(134,607
|
)
|
|||||||
Amortization, net
|
|
(2,586
|
)
|
|
(536
|
)
|
|
(3,122
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,122
|
)
|
|||||||
Change in unrealized gains (losses)
|
|
(3,902
|
)
|
|
—
|
|
|
(3,902
|
)
|
|
143
|
|
|
—
|
|
|
143
|
|
|
(3,759
|
)
|
|||||||
Carrying value at December 31, 2017
|
|
$
|
789,093
|
|
|
$
|
94,073
|
|
|
$
|
883,166
|
|
|
$
|
806
|
|
|
$
|
23,670
|
|
|
$
|
24,476
|
|
|
$
|
907,642
|
|
|
|
December 31,
|
|||||||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||
|
|
Carrying Value
|
|
Percent of Reported Balance
|
|
Carrying Value
|
|
Percent of Reported Balance
|
|
Carrying Value
|
|
Percent of Reported Balance
|
|||||||||
AFS Securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Obligations of U.S. government sponsored enterprises
|
|
$
|
—
|
|
|
—
|
%
|
|
$
|
—
|
|
|
—
|
%
|
|
$
|
5,040
|
|
|
1
|
%
|
Obligations of states and political subdivisions
|
|
7,335
|
|
|
1
|
%
|
|
9,001
|
|
|
1
|
%
|
|
17,694
|
|
|
2
|
%
|
|||
Mortgage-backed securities issued or guaranteed by U.S. government-sponsored enterprises
|
|
503,302
|
|
|
64
|
%
|
|
480,622
|
|
|
62
|
%
|
|
419,046
|
|
|
56
|
%
|
|||
Collateralized mortgage obligations issued or guaranteed by U.S. government-sponsored enterprises
|
|
272,799
|
|
|
34
|
%
|
|
283,890
|
|
|
36
|
%
|
|
306,857
|
|
|
41
|
%
|
|||
Subordinated corporate bonds
|
|
5,657
|
|
|
1
|
%
|
|
5,613
|
|
|
1
|
%
|
|
996
|
|
|
—
|
%
|
|||
Total AFS debt securities
|
|
789,093
|
|
|
100
|
%
|
|
779,126
|
|
|
100
|
%
|
|
749,633
|
|
|
100
|
%
|
|||
Equity securities
|
|
806
|
|
|
—
|
%
|
|
741
|
|
|
—
|
%
|
|
705
|
|
|
—
|
%
|
|||
Total AFS securities
|
|
789,899
|
|
|
100
|
%
|
|
779,867
|
|
|
100
|
%
|
|
750,338
|
|
|
100
|
%
|
|||
HTM Securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Obligations of states and political subdivisions
|
|
94,073
|
|
|
100
|
%
|
|
94,609
|
|
|
100
|
%
|
|
84,144
|
|
|
100
|
%
|
|||
Total HTM securities
|
|
94,073
|
|
|
100
|
%
|
|
94,609
|
|
|
100
|
%
|
|
84,144
|
|
|
100
|
%
|
|||
Total
|
|
$
|
883,972
|
|
|
|
|
$
|
874,476
|
|
|
|
|
$
|
834,482
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
2017
|
|
2016
|
|
2015
|
||||||||||||||
|
|
Due in
1 year or less
|
|
Due in
1 – 5 years
|
|
Due in
5 – 10 years
|
|
Due in
over 10 years
|
|
Book Value
|
|
Book Value
|
|
Book Value
|
||||||||||||||
Debt securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Obligations of U.S. government sponsored enterprises
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,971
|
|
Obligations of states and political subdivisions
|
|
2,301
|
|
|
8,605
|
|
|
10,369
|
|
|
80,030
|
|
|
101,305
|
|
|
103,457
|
|
|
101,499
|
|
|||||||
Mortgage-backed securities issued or guaranteed by U.S. government-sponsored enterprises
|
|
16
|
|
|
61,966
|
|
|
151,332
|
|
|
296,862
|
|
|
510,176
|
|
|
485,222
|
|
|
419,429
|
|
|||||||
Collateralized mortgage obligations issued or guaranteed by U.S. government-sponsored enterprises
|
|
3,420
|
|
|
38,428
|
|
|
55,734
|
|
|
181,993
|
|
|
279,575
|
|
|
289,046
|
|
|
312,719
|
|
|||||||
Private issue collateralized mortgage obligations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Subordinated corporate bonds
|
|
—
|
|
|
—
|
|
|
5,484
|
|
|
—
|
|
|
5,484
|
|
|
5,481
|
|
|
1,000
|
|
|||||||
Total debt securities
|
|
$
|
5,737
|
|
|
$
|
108,999
|
|
|
$
|
222,919
|
|
|
$
|
558,885
|
|
|
$
|
896,540
|
|
|
$
|
883,206
|
|
|
$
|
839,618
|
|
Weighted-average yield on debt securities
|
|
3.16
|
%
|
|
2.22
|
%
|
|
2.24
|
%
|
|
2.43
|
%
|
|
2.36
|
%
|
|
2.33
|
%
|
|
2.36
|
%
|
|
|
December 31,
|
|||||||||||||||||||||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|||||||||||||||||||||||||
Residential real estate
|
|
$
|
858,369
|
|
|
31
|
%
|
|
$
|
802,494
|
|
|
31
|
%
|
|
$
|
820,617
|
|
|
33
|
%
|
|
$
|
585,468
|
|
|
33
|
%
|
|
$
|
569,819
|
|
|
36
|
%
|
Commercial real estate
|
|
1,164,023
|
|
|
42
|
%
|
|
1,050,780
|
|
|
41
|
%
|
|
927,951
|
|
|
37
|
%
|
|
640,661
|
|
|
36
|
%
|
|
541,099
|
|
|
34
|
%
|
|||||
Commercial
|
|
373,400
|
|
|
13
|
%
|
|
333,639
|
|
|
13
|
%
|
|
297,721
|
|
|
12
|
%
|
|
257,515
|
|
|
15
|
%
|
|
179,203
|
|
|
11
|
%
|
|||||
Consumer and home equity
|
|
341,527
|
|
|
12
|
%
|
|
347,239
|
|
|
13
|
%
|
|
366,587
|
|
|
15
|
%
|
|
288,966
|
|
|
16
|
%
|
|
290,281
|
|
|
19
|
%
|
|||||
HPFC
|
|
45,120
|
|
|
2
|
%
|
|
60,412
|
|
|
2
|
%
|
|
77,330
|
|
|
3
|
%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|||||
Total loans
|
|
$
|
2,782,439
|
|
|
100
|
%
|
|
$
|
2,594,564
|
|
|
100
|
%
|
|
$
|
2,490,206
|
|
|
100
|
%
|
|
$
|
1,772,610
|
|
|
100
|
%
|
|
$
|
1,580,402
|
|
|
100
|
%
|
Loan portfolio mix:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Retail
|
|
1,199,896
|
|
|
43
|
%
|
|
1,149,733
|
|
|
44
|
%
|
|
1,187,204
|
|
|
48
|
%
|
|
874,434
|
|
|
49
|
%
|
|
860,100
|
|
|
55
|
%
|
|||||
Commercial
|
|
1,582,543
|
|
|
57
|
%
|
|
1,444,831
|
|
|
56
|
%
|
|
1,303,002
|
|
|
52
|
%
|
|
898,176
|
|
|
51
|
%
|
|
720,302
|
|
|
45
|
%
|
|
|
December 31,
|
|
Change
|
|
SBM
Acquisition
|
|
Year Ended
December 31, 2015
Organic Growth
|
||||||||||||||||||
|
|
2015
|
|
2014
|
|
($)
|
|
(%)
|
|
|
||||||||||||||||
Residential
|
|
$
|
820,617
|
|
|
$
|
585,468
|
|
|
$
|
235,149
|
|
|
40
|
%
|
|
$
|
234,619
|
|
|
$
|
530
|
|
|
—
|
%
|
Commercial real estate
|
|
927,951
|
|
|
640,661
|
|
|
287,290
|
|
|
45
|
%
|
|
193,883
|
|
|
93,407
|
|
|
15
|
%
|
|||||
Commercial
|
|
297,721
|
|
|
257,515
|
|
|
40,206
|
|
|
16
|
%
|
|
35,417
|
|
|
4,789
|
|
|
2
|
%
|
|||||
Home equity
|
|
348,634
|
|
|
271,709
|
|
|
76,925
|
|
|
28
|
%
|
|
71,005
|
|
|
5,920
|
|
|
2
|
%
|
|||||
Consumer
|
|
17,953
|
|
|
17,257
|
|
|
696
|
|
|
4
|
%
|
|
2,526
|
|
|
(1,830
|
)
|
|
(11
|
)%
|
|||||
HPFC
|
|
77,330
|
|
|
—
|
|
|
77,330
|
|
|
N.M.
|
|
|
77,773
|
|
|
(443
|
)
|
|
N.M.
|
|
|||||
Total loans
|
|
$
|
2,490,206
|
|
|
$
|
1,772,610
|
|
|
$
|
717,596
|
|
|
40
|
%
|
|
$
|
615,223
|
|
|
$
|
102,373
|
|
|
6
|
%
|
|
|
December 31,
|
||||||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
Non-accrual loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Residential real estate loans
|
|
$
|
4,979
|
|
|
$
|
3,945
|
|
|
$
|
7,253
|
|
|
$
|
6,056
|
|
|
$
|
10,520
|
|
Commercial real estate
|
|
5,642
|
|
|
12,849
|
|
|
4,529
|
|
|
7,043
|
|
|
7,799
|
|
|||||
Commercial loans
|
|
2,000
|
|
|
2,088
|
|
|
4,489
|
|
|
1,529
|
|
|
2,146
|
|
|||||
Consumer and home equity loans
|
|
1,650
|
|
|
1,624
|
|
|
2,051
|
|
|
2,011
|
|
|
2,012
|
|
|||||
HPFC
|
|
1,043
|
|
|
207
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Non-accrual loans
|
|
15,314
|
|
|
20,713
|
|
|
18,322
|
|
|
16,639
|
|
|
22,477
|
|
|||||
Accruing loans past due 90 days
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
455
|
|
|||||
Accruing TDRs (not included above)
|
|
5,012
|
|
|
4,338
|
|
|
4,861
|
|
|
4,539
|
|
|
5,468
|
|
|||||
Total non-performing loans
|
|
20,326
|
|
|
25,051
|
|
|
23,183
|
|
|
21,178
|
|
|
28,400
|
|
|||||
Other real estate owned
|
|
130
|
|
|
922
|
|
|
1,304
|
|
|
1,587
|
|
|
2,195
|
|
|||||
Total non-performing assets
|
|
$
|
20,456
|
|
|
$
|
25,973
|
|
|
$
|
24,487
|
|
|
$
|
22,765
|
|
|
$
|
30,595
|
|
Non-accrual loans to total loans
|
|
0.55
|
%
|
|
0.80
|
%
|
|
0.74
|
%
|
|
0.94
|
%
|
|
1.44
|
%
|
|||||
Non-performing loans to total loans
|
|
0.73
|
%
|
|
0.97
|
%
|
|
0.93
|
%
|
|
1.19
|
%
|
|
1.82
|
%
|
|||||
Allowance for loan losses to non-performing loans
|
|
118.92
|
%
|
|
92.28
|
%
|
|
91.30
|
%
|
|
99.71
|
%
|
|
76.02
|
%
|
|||||
Non-performing assets to total assets
|
|
0.50
|
%
|
|
0.67
|
%
|
|
0.66
|
%
|
|
0.82
|
%
|
|
1.18
|
%
|
|||||
Allowance for loan losses to non-performing assets
|
|
118.16
|
%
|
|
89.00
|
%
|
|
86.44
|
%
|
|
92.76
|
%
|
|
70.57
|
%
|
|
|
For The Year Ended
December 31,
|
||||||||||
|
|
2017
|
|
2016
|
|
2015
|
||||||
Foregone interest income
|
|
$
|
843
|
|
|
$
|
888
|
|
|
$
|
586
|
|
Interest income recognized on non-performing loans and performing TDRs
|
|
215
|
|
|
182
|
|
|
204
|
|
|
|
December 31,
|
||||||
|
|
2017
|
|
2016
|
||||
Loans 30 – 89 days past due:
|
|
|
|
|
|
|
||
Residential real estate loans
|
|
$
|
5,277
|
|
|
$
|
2,470
|
|
Commercial real estate loans
|
|
1,135
|
|
|
971
|
|
||
Commercial loans
|
|
518
|
|
|
851
|
|
||
Consumer and home equity loans
|
|
1,197
|
|
|
1,018
|
|
||
HPFC
|
|
887
|
|
|
1,029
|
|
||
Total loans 30 – 89 days past due
|
|
$
|
9,014
|
|
|
$
|
6,339
|
|
Loans 30 – 89 days past due to total loans
|
|
0.32
|
%
|
|
0.24
|
%
|
|
|
At or For the Year Ended
December 31,
|
||||||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
ALL at the beginning of period
|
|
$
|
23,116
|
|
|
$
|
21,166
|
|
|
$
|
21,116
|
|
|
$
|
21,590
|
|
|
$
|
23,044
|
|
Provision for loan losses
|
|
3,026
|
|
|
5,269
|
|
|
1,938
|
|
|
2,224
|
|
|
2,052
|
|
|||||
Charge-offs:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Residential real estate
|
|
482
|
|
|
356
|
|
|
801
|
|
|
785
|
|
|
1,059
|
|
|||||
Commercial real estate
|
|
124
|
|
|
315
|
|
|
481
|
|
|
361
|
|
|
952
|
|
|||||
Commercial
|
|
1,014
|
|
|
2,218
|
|
|
655
|
|
|
1,544
|
|
|
1,426
|
|
|||||
Consumer and home equity
|
|
558
|
|
|
409
|
|
|
679
|
|
|
754
|
|
|
837
|
|
|||||
HPFC
|
|
290
|
|
|
507
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total loan charge-offs
|
|
2,468
|
|
|
3,805
|
|
|
2,616
|
|
|
3,444
|
|
|
4,274
|
|
|||||
Recoveries:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Residential real estate
|
|
30
|
|
|
95
|
|
|
55
|
|
|
165
|
|
|
35
|
|
|||||
Commercial real estate
|
|
141
|
|
|
50
|
|
|
74
|
|
|
135
|
|
|
121
|
|
|||||
Commercial
|
|
301
|
|
|
332
|
|
|
389
|
|
|
395
|
|
|
495
|
|
|||||
Consumer and home equity
|
|
19
|
|
|
9
|
|
|
210
|
|
|
51
|
|
|
117
|
|
|||||
HPFC
|
|
6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total loan recoveries
|
|
497
|
|
|
486
|
|
|
728
|
|
|
746
|
|
|
768
|
|
|||||
Net charge-offs
|
|
1,971
|
|
|
3,319
|
|
|
1,888
|
|
|
2,698
|
|
|
3,506
|
|
|||||
ALL at the end of the period
|
|
$
|
24,171
|
|
|
$
|
23,116
|
|
|
$
|
21,166
|
|
|
$
|
21,116
|
|
|
$
|
21,590
|
|
Components of allowance for credit losses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
ALL
|
|
$
|
24,171
|
|
|
$
|
23,116
|
|
|
$
|
21,166
|
|
|
$
|
21,116
|
|
|
$
|
21,590
|
|
Liability for unfunded credit commitments
|
|
20
|
|
|
11
|
|
|
22
|
|
|
17
|
|
|
21
|
|
|||||
Balance of allowance for credit losses at end of the period
|
|
$
|
24,191
|
|
|
$
|
23,127
|
|
|
$
|
21,188
|
|
|
$
|
21,133
|
|
|
$
|
21,611
|
|
Net charge-offs to average loans outstanding
|
|
0.07
|
%
|
|
0.13
|
%
|
|
0.10
|
%
|
|
0.16
|
%
|
|
0.22
|
%
|
|||||
Provision for loan losses to average loans outstanding
|
|
0.11
|
%
|
|
0.21
|
%
|
|
0.10
|
%
|
|
0.13
|
%
|
|
0.13
|
%
|
|||||
ALL to total loans
|
|
0.87
|
%
|
|
0.89
|
%
|
|
0.85
|
%
|
|
1.19
|
%
|
|
1.38
|
%
|
|||||
ALL to net charge-offs
|
|
1,226.33
|
%
|
|
696.47
|
%
|
|
1,121.08
|
%
|
|
782.65
|
%
|
|
615.80
|
%
|
|
|
December 31,
|
|||||||||||||||||||||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|||||||||||||||||||||||||
|
|
Amount
|
|
Percent of Loans in Each Category to Total Loans
|
|
Amount
|
|
Percent of Loans in Each Category to Total Loans
|
|
Amount
|
|
Percent of Loans in Each Category to Total Loans
|
|
Amount
|
|
Percent of Loans in Each Category to Total Loans
|
|
Amount
|
|
Percent of Loans in Each Category to Total Loans
|
|||||||||||||||
Residential real estate loans
|
|
$
|
5,086
|
|
|
31
|
%
|
|
$
|
4,160
|
|
|
31
|
%
|
|
$
|
4,545
|
|
|
33
|
%
|
|
$
|
4,899
|
|
|
33
|
%
|
|
$
|
5,603
|
|
|
36
|
%
|
Commercial real estate loans
|
|
11,863
|
|
|
42
|
%
|
|
12,154
|
|
|
41
|
%
|
|
10,432
|
|
|
37
|
%
|
|
7,951
|
|
|
36
|
%
|
|
4,374
|
|
|
34
|
%
|
|||||
Commercial loans
|
|
4,171
|
|
|
13
|
%
|
|
3,755
|
|
|
13
|
%
|
|
3,241
|
|
|
12
|
%
|
|
3,354
|
|
|
15
|
%
|
|
6,220
|
|
|
11
|
%
|
|||||
Consumer and home equity loans
|
|
2,600
|
|
|
12
|
%
|
|
2,375
|
|
|
13
|
%
|
|
2,924
|
|
|
15
|
%
|
|
2,528
|
|
|
16
|
%
|
|
2,722
|
|
|
19
|
%
|
|||||
HPFC
|
|
451
|
|
|
2
|
%
|
|
672
|
|
|
2
|
%
|
|
24
|
|
|
3
|
%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|||||
Unallocated
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
2,384
|
|
|
—
|
%
|
|
2,671
|
|
|
—
|
%
|
|||||
|
|
$
|
24,171
|
|
|
100
|
%
|
|
$
|
23,116
|
|
|
100
|
%
|
|
$
|
21,166
|
|
|
100
|
%
|
|
$
|
21,116
|
|
|
100
|
%
|
|
$
|
21,590
|
|
|
100
|
%
|
|
|
For the Year Ended
December 31,
|
|||||||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||
|
|
Average
Balance
|
|
Average
Rate Paid
|
|
Average
Balance
|
|
Average
Rate Paid
|
|
Average
Balance
|
|
Average
Rate Paid
|
|||||||||
Deposits:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Demand
|
|
$
|
430,706
|
|
|
—
|
%
|
|
$
|
386,189
|
|
|
—
|
%
|
|
$
|
292,776
|
|
|
—
|
%
|
Interest checking
|
|
750,543
|
|
|
0.21
|
%
|
|
724,222
|
|
|
0.13
|
%
|
|
543,330
|
|
|
0.08
|
%
|
|||
Savings
|
|
492,483
|
|
|
0.06
|
%
|
|
461,794
|
|
|
0.06
|
%
|
|
306,536
|
|
|
0.06
|
%
|
|||
Money market
|
|
480,119
|
|
|
0.52
|
%
|
|
490,155
|
|
|
0.42
|
%
|
|
394,367
|
|
|
0.33
|
%
|
|||
Total core deposits
|
|
2,153,851
|
|
|
0.20
|
%
|
|
2,062,360
|
|
|
0.16
|
%
|
|
1,537,009
|
|
|
0.12
|
%
|
|||
Certificates of deposit
|
|
466,418
|
|
|
0.88
|
%
|
|
489,040
|
|
|
0.78
|
%
|
|
357,972
|
|
|
0.87
|
%
|
|||
Total deposits
|
|
2,620,269
|
|
|
0.32
|
%
|
|
2,551,400
|
|
|
0.28
|
%
|
|
1,894,981
|
|
|
0.26
|
%
|
|||
Brokered deposits
|
|
296,261
|
|
|
1.13
|
%
|
|
231,610
|
|
|
0.69
|
%
|
|
229,079
|
|
|
0.65
|
%
|
|||
Total deposits, including brokered deposits
|
|
$
|
2,916,530
|
|
|
0.40
|
%
|
|
$
|
2,783,010
|
|
|
0.31
|
%
|
|
$
|
2,124,060
|
|
|
0.31
|
%
|
|
December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
FHLBB and correspondent bank overnight borrowings:
|
|
|
|
|
|
||||||
Balance outstanding at end of year
|
$
|
47,150
|
|
|
$
|
89,450
|
|
|
$
|
12,800
|
|
Average daily balance outstanding
|
73,487
|
|
|
36,492
|
|
|
18,229
|
|
|||
Maximum balance outstanding at any month end
|
135,550
|
|
|
157,197
|
|
|
70,000
|
|
|||
Weighted average interest rate for the year
|
1.19
|
%
|
|
0.57
|
%
|
|
0.35
|
%
|
|||
Weighted average interest rate at end of year
|
1.59
|
%
|
|
0.80
|
%
|
|
0.51
|
%
|
|||
FHLBB advances less than 90 days:
|
|
|
|
|
|
||||||
Balance outstanding at end of year
|
$
|
250,000
|
|
|
$
|
190,000
|
|
|
$
|
230,000
|
|
Average daily balance outstanding
|
233,305
|
|
|
258,713
|
|
|
253,679
|
|
|||
Maximum balance outstanding at any month end
|
330,000
|
|
|
370,000
|
|
|
285,000
|
|
|||
Weighted average interest rate for the year
|
1.23
|
%
|
|
0.71
|
%
|
|
0.25
|
%
|
|||
Weighted average interest rate at end of year
|
1.53
|
%
|
|
0.76
|
%
|
|
0.46
|
%
|
|||
Customer repurchase agreements:
|
|
|
|
|
|
||||||
Balance outstanding at end of year
|
$
|
244,646
|
|
|
$
|
225,605
|
|
|
$
|
184,989
|
|
Average daily balance outstanding
|
232,762
|
|
|
198,403
|
|
|
153,101
|
|
|||
Maximum balance outstanding at any month end
|
265,627
|
|
|
239,862
|
|
|
194,625
|
|
|||
Weighted average interest rate for the year
|
0.46
|
%
|
|
0.28
|
%
|
|
0.20
|
%
|
|||
Weighted average interest rate at end of year
|
0.56
|
%
|
|
0.31
|
%
|
|
0.24
|
%
|
|
|
December 31,
|
||||||||||
|
|
2017
|
|
2016
|
|
2015
|
||||||
Return on average assets
|
|
0.71
|
%
|
|
1.04
|
%
|
|
0.70
|
%
|
|||
Adjusted return on average assets
(1)
|
|
1.07
|
%
|
|
1.06
|
%
|
|
0.94
|
%
|
|||
Return on average equity
|
|
7.00
|
%
|
|
10.47
|
%
|
|
7.54
|
%
|
|||
Adjusted return on average equity
(1)
|
|
10.51
|
%
|
|
10.62
|
%
|
|
10.15
|
%
|
|||
Adjusted return on average tangible equity
(1)
|
|
14.35
|
%
|
|
14.96
|
%
|
|
13.21
|
%
|
|||
Average equity to average assets
|
|
10.19
|
%
|
|
9.97
|
%
|
|
9.26
|
%
|
|||
Dividend payout ratio
|
|
51.43
|
%
|
|
32.22
|
%
|
|
50.60
|
%
|
|||
Book value per share
|
|
$
|
25.99
|
|
|
$
|
25.30
|
|
|
$
|
23.69
|
|
Tangible book value per share
(1)
|
|
$
|
19.57
|
|
|
$
|
18.74
|
|
|
$
|
16.89
|
|
Dividends declared per share
|
|
$
|
0.94
|
|
|
$
|
0.83
|
|
|
$
|
0.80
|
|
(1)
|
The following was not calculated in accordance with GAAP. Refer to the "
— Non-GAAP Financial Measures and Reconciliation to GAAP"
within
Item 7
.
|
Time remaining until maturity:
|
|
December 31,
2017
|
||
Less than 3 months
|
|
$
|
21,924
|
|
3 months through 6 months
|
|
35,812
|
|
|
6 months through 12 months
|
|
65,671
|
|
|
Over 12 months
|
|
126,311
|
|
|
Total
|
|
$
|
249,718
|
|
|
|
< 1 Year
|
|
1 - 5 Years
|
|
More than
5 Years
|
|
Total
|
||||||||
Maturity Distribution:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Fixed Rate:
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Residential real estate
|
|
$
|
482
|
|
|
$
|
5,224
|
|
|
$
|
512,166
|
|
|
$
|
517,872
|
|
Commercial real estate
|
|
7,857
|
|
|
106,939
|
|
|
106,786
|
|
|
221,582
|
|
||||
Commercial
|
|
6,038
|
|
|
59,400
|
|
|
87,710
|
|
|
153,148
|
|
||||
Consumer and home equity
|
|
1,831
|
|
|
13,222
|
|
|
265,045
|
|
|
280,098
|
|
||||
Total fixed rate
|
|
16,208
|
|
|
184,785
|
|
|
971,707
|
|
|
1,172,700
|
|
||||
Variable Rate:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Residential real estate
|
|
2,403
|
|
|
1,517
|
|
|
336,577
|
|
|
340,497
|
|
||||
Commercial real estate
|
|
13,383
|
|
|
77,294
|
|
|
851,764
|
|
|
942,441
|
|
||||
Commercial
|
|
60,135
|
|
|
105,408
|
|
|
99,827
|
|
|
265,370
|
|
||||
Consumer and home equity
|
|
26
|
|
|
10,784
|
|
|
50,618
|
|
|
61,428
|
|
||||
Total variable rate
|
|
75,947
|
|
|
195,003
|
|
|
1,338,786
|
|
|
1,609,736
|
|
||||
Total loans
|
|
$
|
92,155
|
|
|
$
|
379,788
|
|
|
$
|
2,310,493
|
|
|
$
|
2,782,436
|
|
|
|
Total Amount Committed
|
|
Commitment Expires in:
|
||||||||||||||||
Off-Balance Sheet Financial Instruments
|
|
|
< 1 Year
|
|
1 – 3 Years
|
|
4 – 5 Years
|
|
> 5 Years
|
|||||||||||
Home equity line of credit commitments
|
|
$
|
477,401
|
|
|
$
|
176,021
|
|
|
$
|
66,946
|
|
|
$
|
6,228
|
|
|
$
|
228,206
|
|
Commercial commitment letters
|
|
49,482
|
|
|
49,482
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Residential loan origination
|
|
41,368
|
|
|
41,368
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Letters of credit
|
|
2,848
|
|
|
2,848
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Other commitments to extend credit
|
|
523
|
|
|
523
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Customer loan swaps - notional value
|
|
703,336
|
|
|
—
|
|
|
18,793
|
|
|
153,808
|
|
|
530,735
|
|
|||||
FHLBB advance interest rate swaps - notional value
|
|
50,000
|
|
|
25,000
|
|
|
25,000
|
|
|
—
|
|
|
—
|
|
|||||
Junior subordinated debt interest rate swaps - notional value
|
|
43,000
|
|
|
—
|
|
|
—
|
|
|
10,000
|
|
|
33,000
|
|
|||||
Fixed-rate mortgage interest rate lock commitments -notional value
|
|
21,746
|
|
|
21,746
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Forward delivery commitments - notional value
|
|
8,065
|
|
|
8,065
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
1,397,769
|
|
|
$
|
325,053
|
|
|
$
|
110,739
|
|
|
$
|
170,036
|
|
|
$
|
791,941
|
|
|
|
Total Amount Committed
|
|
Payments Due Per Period
|
||||||||||||||||
Contractual obligations and commitments
|
|
|
< 1 Year
|
|
1 – 3 Years
|
|
4 – 5 Years
|
|
> 5 Years
|
|||||||||||
Operating leases
|
|
$
|
6,397
|
|
|
$
|
1,429
|
|
|
$
|
2,282
|
|
|
$
|
1,155
|
|
|
$
|
1,531
|
|
Capital leases
|
|
1,064
|
|
|
126
|
|
|
252
|
|
|
261
|
|
|
425
|
|
|||||
FHLBB borrowings – overnight
|
|
47,150
|
|
|
47,150
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
FHLBB advances less than 90 days
|
|
250,000
|
|
|
250,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
FHLBB advances – other
|
|
10,000
|
|
|
—
|
|
|
10,000
|
|
|
—
|
|
|
—
|
|
|||||
Retail repurchase agreements
|
|
244,646
|
|
|
244,646
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Junior subordinated debentures
|
|
44,331
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
44,331
|
|
|||||
Subordinated debentures
|
|
14,580
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,580
|
|
|||||
Other contractual obligations
|
|
1,230
|
|
|
1,230
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
619,398
|
|
|
$
|
544,581
|
|
|
$
|
12,534
|
|
|
$
|
1,416
|
|
|
$
|
60,867
|
|
|
|
Estimated Changes in
Net Interest Income
|
||||
Rate Change from Year 1 – Base
|
|
2017
|
|
2016
|
||
Year 1
|
|
|
|
|
|
|
+200 basis points
|
|
(0.22
|
)%
|
|
(0.93
|
)%
|
-100 basis points
|
|
(3.06
|
)%
|
|
(1.45
|
)%
|
Year 2
|
|
|
|
|
||
+200 basis points
|
|
6.86
|
%
|
|
3.63
|
%
|
-100 basis points
|
|
(8.08
|
)%
|
|
(7.73
|
)%
|
|
|
December 31,
|
||||||
(In thousands, except number of shares)
|
|
2017
|
|
2016
|
||||
ASSETS
|
|
|
|
|
|
|
||
Cash and due from banks
|
|
$
|
48,107
|
|
|
$
|
52,168
|
|
Interest-bearing deposits in other banks
|
|
54,864
|
|
|
35,539
|
|
||
Total cash and cash equivalents
|
|
102,971
|
|
|
87,707
|
|
||
Investments:
|
|
|
|
|
||||
Available-for-sale securities, at fair value
|
|
789,899
|
|
|
779,867
|
|
||
Held-to-maturity securities, at amortized cost (fair value of $94,913 and $94,596, respectively)
|
|
94,073
|
|
|
94,609
|
|
||
Federal Home Loan Bank and Federal Reserve Bank stock, at cost
|
|
23,670
|
|
|
23,203
|
|
||
Total investments
|
|
907,642
|
|
|
897,679
|
|
||
Loans held for sale, at fair value
|
|
8,103
|
|
|
14,836
|
|
||
Loans:
|
|
2,782,439
|
|
|
2,594,564
|
|
||
Less: allowance for loan losses
|
|
(24,171
|
)
|
|
(23,116
|
)
|
||
Net loans
|
|
2,758,268
|
|
|
2,571,448
|
|
||
Goodwill
|
|
94,697
|
|
|
94,697
|
|
||
Other intangible assets
|
|
4,955
|
|
|
6,764
|
|
||
Bank-owned life insurance
|
|
87,489
|
|
|
78,119
|
|
||
Premises and equipment, net
|
|
41,891
|
|
|
42,873
|
|
||
Deferred tax assets
|
|
22,776
|
|
|
39,263
|
|
||
Other assets
|
|
36,606
|
|
|
30,844
|
|
||
Total assets
|
|
$
|
4,065,398
|
|
|
$
|
3,864,230
|
|
|
|
|
|
|
||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
||
Liabilities
|
|
|
|
|
||||
Deposits:
|
|
|
|
|
|
|
||
Demand
|
|
$
|
478,643
|
|
|
$
|
406,934
|
|
Interest checking
|
|
855,570
|
|
|
701,494
|
|
||
Savings and money market
|
|
985,508
|
|
|
979,263
|
|
||
Retail certificates of deposit
|
|
475,010
|
|
|
468,203
|
|
||
Brokered deposits
|
|
205,760
|
|
|
272,635
|
|
||
Total deposits
|
|
3,000,491
|
|
|
2,828,529
|
|
||
Short-term borrowings
|
|
541,867
|
|
|
530,129
|
|
||
Long-term borrowings
|
|
10,720
|
|
|
10,791
|
|
||
Subordinated debentures
|
|
58,911
|
|
|
58,755
|
|
||
Accrued interest and other liabilities
|
|
49,996
|
|
|
44,479
|
|
||
Total liabilities
|
|
3,661,985
|
|
|
3,472,683
|
|
||
Commitments and contingencies
|
|
|
|
|
|
|
||
Shareholders’ Equity
|
|
|
|
|
||||
Common stock, no par value: authorized 40,000,000 shares, issued and outstanding 15,524,704 and 15,476,379 on December 31, 2017 and 2016, respectively
|
|
156,904
|
|
|
156,041
|
|
||
Retained earnings
|
|
266,723
|
|
|
249,415
|
|
||
Accumulated other comprehensive loss:
|
|
|
|
|
||||
Net unrealized losses on available-for-sale securities, net of tax
|
|
(10,300
|
)
|
|
(6,085
|
)
|
||
Net unrealized losses on cash flow hedging derivative instruments, net of tax
|
|
(5,926
|
)
|
|
(5,694
|
)
|
||
Net unrecognized losses on postretirement plans, net of tax
|
|
(3,988
|
)
|
|
(2,130
|
)
|
||
Total accumulated other comprehensive loss
|
|
(20,214
|
)
|
|
(13,909
|
)
|
||
Total shareholders’ equity
|
|
403,413
|
|
|
391,547
|
|
||
Total liabilities and shareholders’ equity
|
|
$
|
4,065,398
|
|
|
$
|
3,864,230
|
|
|
|
For The Year Ended
December 31,
|
||||||||||
(In thousands, except number of shares and per share data)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Interest Income
|
|
|
|
|
|
|
|
|
|
|||
Interest and fees on loans
|
|
$
|
114,563
|
|
|
$
|
109,224
|
|
|
$
|
81,221
|
|
Interest on U.S. government and sponsored enterprise obligations (taxable)
|
|
16,879
|
|
|
16,082
|
|
|
15,091
|
|
|||
Interest on state and political subdivision obligations (nontaxable)
|
|
2,764
|
|
|
2,836
|
|
|
2,208
|
|
|||
Interest on other investments
|
|
1,898
|
|
|
1,484
|
|
|
624
|
|
|||
Total interest income
|
|
136,104
|
|
|
129,626
|
|
|
99,144
|
|
|||
Interest Expense
|
|
|
|
|
|
|
|
|
|
|||
Interest on deposits
|
|
11,811
|
|
|
8,633
|
|
|
6,511
|
|
|||
Interest on borrowings
|
|
5,585
|
|
|
4,506
|
|
|
3,457
|
|
|||
Interest on subordinated debentures
|
|
3,408
|
|
|
3,415
|
|
|
2,724
|
|
|||
Total interest expense
|
|
20,804
|
|
|
16,554
|
|
|
12,692
|
|
|||
Net interest income
|
|
115,300
|
|
|
113,072
|
|
|
86,452
|
|
|||
Provision for credit losses
|
|
3,035
|
|
|
5,258
|
|
|
1,936
|
|
|||
Net interest income after provision for credit losses
|
|
112,265
|
|
|
107,814
|
|
|
84,516
|
|
|||
Non-Interest Income
|
|
|
|
|
|
|
|
|
|
|||
Debit card income
|
|
8,079
|
|
|
7,578
|
|
|
5,277
|
|
|||
Service charges on deposit accounts
|
|
7,529
|
|
|
7,210
|
|
|
6,423
|
|
|||
Mortgage banking income, net
|
|
7,363
|
|
|
6,258
|
|
|
2,031
|
|
|||
Income from fiduciary services
|
|
5,108
|
|
|
4,960
|
|
|
4,918
|
|
|||
Bank-owned life insurance
|
|
2,370
|
|
|
2,594
|
|
|
1,680
|
|
|||
Brokerage and insurance commissions
|
|
2,147
|
|
|
2,074
|
|
|
1,699
|
|
|||
Other service charges and fees
|
|
2,029
|
|
|
1,962
|
|
|
1,573
|
|
|||
Net gain on sale of securities
|
|
855
|
|
|
51
|
|
|
4
|
|
|||
Other income
|
|
3,119
|
|
|
6,934
|
|
|
3,877
|
|
|||
Total non-interest income
|
|
38,599
|
|
|
39,621
|
|
|
27,482
|
|
|||
Non-Interest Expense
|
|
|
|
|
|
|
|
|
|
|||
Salaries and employee benefits
|
|
49,965
|
|
|
48,072
|
|
|
37,220
|
|
|||
Furniture, equipment and data processing
|
|
9,894
|
|
|
9,557
|
|
|
8,057
|
|
|||
Net occupancy costs
|
|
6,884
|
|
|
7,088
|
|
|
5,695
|
|
|||
Consulting and professional fees
|
|
3,118
|
|
|
3,234
|
|
|
2,625
|
|
|||
Debit card expense
|
|
2,755
|
|
|
2,584
|
|
|
1,936
|
|
|||
Regulatory assessments
|
|
2,166
|
|
|
2,777
|
|
|
2,184
|
|
|||
Amortization of intangible assets
|
|
1,809
|
|
|
1,903
|
|
|
1,306
|
|
|||
Other real estate owned and collection costs, net
|
|
971
|
|
|
3,128
|
|
|
2,491
|
|
|||
Merger and acquisition costs
|
|
—
|
|
|
866
|
|
|
10,415
|
|
|||
Other expenses
|
|
10,948
|
|
|
10,687
|
|
|
9,210
|
|
|||
Total non-interest expense
|
|
88,510
|
|
|
89,896
|
|
|
81,139
|
|
|||
Income before income tax expense
|
|
62,354
|
|
|
57,539
|
|
|
30,859
|
|
|||
Income Tax Expense
|
|
33,878
|
|
|
17,472
|
|
|
9,907
|
|
|||
Net income
|
|
$
|
28,476
|
|
|
$
|
40,067
|
|
|
$
|
20,952
|
|
Per Share Data:
|
|
|
|
|
|
|
|
|
|
|||
Basic earnings per share
|
|
$
|
1.83
|
|
|
$
|
2.59
|
|
|
$
|
1.73
|
|
Diluted earnings per share
|
|
$
|
1.82
|
|
|
$
|
2.57
|
|
|
$
|
1.73
|
|
Weighted average number of common shares outstanding
|
|
15,509,665
|
|
|
15,422,160
|
|
|
12,031,294
|
|
|||
Diluted weighted average number of common shares outstanding
|
|
15,588,347
|
|
|
15,504,239
|
|
|
12,074,579
|
|
|
|
For The Year Ended
December 31,
|
||||||||||
(In thousands)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Net income
|
|
$
|
28,476
|
|
|
$
|
40,067
|
|
|
$
|
20,952
|
|
Other comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|||
Net change in unrealized losses on available-for-sale securities:
|
|
|
|
|
|
|
|
|
|
|||
Net change in unrealized losses on available-for-sale securities, net of tax of $1,017, $1,212, and $1,873, respectively
|
|
(1,888
|
)
|
|
(2,251
|
)
|
|
(3,479
|
)
|
|||
Net reclassification adjustment for net gains included in net income, net of tax of $299, $18, and $1, respectively
(1)
|
|
(556
|
)
|
|
(33
|
)
|
|
(3
|
)
|
|||
Net change in unrealized losses on available-for-sale securities, net of tax
|
|
(2,444
|
)
|
|
(2,284
|
)
|
|
(3,482
|
)
|
|||
Net change in unrealized gains (losses) on cash flow hedging derivatives:
|
|
|
|
|
|
|
||||||
Net change in unrealized losses on cash flow hedging derivatives, net of tax of $134, $343, and $825, respectively
|
|
(248
|
)
|
|
(637
|
)
|
|
(1,533
|
)
|
|||
Net reclassification adjustment for effective portion of cash flow hedges, net of tax of ($557), ($709), and ($593), respectively
(2)
|
|
1,035
|
|
|
1,317
|
|
|
1,102
|
|
|||
Net change in unrealized gains (losses) on cash flow hedging derivatives, net of tax
|
|
787
|
|
|
680
|
|
|
(431
|
)
|
|||
Postretirement plans:
|
|
|
|
|
|
|
||||||
Net actuarial loss, net of tax of $723, $127, and $21, respectively
|
|
(1,342
|
)
|
|
(235
|
)
|
|
(39
|
)
|
|||
Reclassification of amortization of net unrecognized actuarial loss and of net prior service cost included in net periodic cost, net of tax of ($92), ($83), and ($84), respectively
(3)
|
|
170
|
|
|
152
|
|
|
155
|
|
|||
Net gain (loss) on postretirement plans, net of tax
|
|
(1,172
|
)
|
|
(83
|
)
|
|
116
|
|
|||
Other comprehensive loss
|
|
(2,829
|
)
|
|
(1,687
|
)
|
|
(3,797
|
)
|
|||
Comprehensive income
|
|
$
|
25,647
|
|
|
$
|
38,380
|
|
|
$
|
17,155
|
|
(1)
|
Reclassified into the consolidated statements of income within net gain on sale of securities.
|
(2)
|
Reclassified into the consolidated statements of income within interest on borrowings and subordinated debentures.
|
(3)
|
Reclassified into the consolidated statements of income within salaries and employee benefits.
|
|
|
Common Stock
|
|
Retained Earnings
|
|
Accumulated Other Comprehensive Loss
|
|
Total Shareholders’ Equity
|
|||||||||||
(In thousands, except number of shares and per share data)
|
|
Shares Outstanding
|
|
Amount
|
|
||||||||||||||
Balance at December 31, 2014
|
|
11,139,333
|
|
|
$
|
41,555
|
|
|
$
|
211,979
|
|
|
$
|
(8,425
|
)
|
|
$
|
245,109
|
|
Net income
|
|
—
|
|
|
—
|
|
|
20,952
|
|
|
—
|
|
|
20,952
|
|
||||
Other comprehensive loss, net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,797
|
)
|
|
(3,797
|
)
|
||||
Stock-based compensation expense
|
|
—
|
|
|
836
|
|
|
—
|
|
|
—
|
|
|
836
|
|
||||
Exercise of stock options and issuance of vested share awards, net of repurchase for tax withholdings
|
|
66,741
|
|
|
753
|
|
|
—
|
|
|
—
|
|
|
753
|
|
||||
Equity issuance costs incurred for the SBM Financial, Inc. acquisition
|
|
—
|
|
|
(612
|
)
|
|
—
|
|
|
—
|
|
|
(612
|
)
|
||||
Common stock issued for the SBM Financial, Inc. acquisition
|
|
4,124,643
|
|
|
108,561
|
|
|
—
|
|
|
—
|
|
|
108,561
|
|
||||
Non-qualified stock option awards issued for the SBM Financial, Inc. acquisition
|
|
—
|
|
|
1,990
|
|
|
—
|
|
|
—
|
|
|
1,990
|
|
||||
Cash dividends declared ($0.80 per share)
|
|
—
|
|
|
—
|
|
|
(10,602
|
)
|
|
—
|
|
|
(10,602
|
)
|
||||
Balance at December 31, 2015
|
|
15,330,717
|
|
|
153,083
|
|
|
222,329
|
|
|
(12,222
|
)
|
|
363,190
|
|
||||
Cumulative effect adjustment
(1)
|
|
—
|
|
|
72
|
|
|
(72
|
)
|
|
—
|
|
|
—
|
|
||||
Cash in lieu for fractional shares paid due to the stock split (Note 14)
|
|
(173
|
)
|
|
(5
|
)
|
|
—
|
|
|
—
|
|
|
(5
|
)
|
||||
Net income
|
|
—
|
|
|
—
|
|
|
40,067
|
|
|
—
|
|
|
40,067
|
|
||||
Other comprehensive loss, net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,687
|
)
|
|
(1,687
|
)
|
||||
Stock-based compensation expense
|
|
—
|
|
|
1,997
|
|
|
—
|
|
|
—
|
|
|
1,997
|
|
||||
Exercise of stock options and issuance of vested share awards, net of repurchase for tax withholdings and tax benefit
|
|
145,835
|
|
|
894
|
|
|
—
|
|
|
—
|
|
|
894
|
|
||||
Cash dividends declared ($0.83 per share)
|
|
—
|
|
|
—
|
|
|
(12,909
|
)
|
|
—
|
|
|
(12,909
|
)
|
||||
Balance at December 31, 2016
|
|
15,476,379
|
|
|
156,041
|
|
|
249,415
|
|
|
(13,909
|
)
|
|
391,547
|
|
||||
Net income
|
|
—
|
|
|
—
|
|
|
28,476
|
|
|
—
|
|
|
28,476
|
|
||||
Reclassification of certain income tax effects from AOCI
(2)
|
|
—
|
|
|
—
|
|
|
3,476
|
|
|
(3,476
|
)
|
|
—
|
|
||||
Other comprehensive loss, net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,829
|
)
|
|
(2,829
|
)
|
||||
Stock-based compensation expense
|
|
—
|
|
|
1,469
|
|
|
—
|
|
|
—
|
|
|
1,469
|
|
||||
Exercise of stock options and issuance of vested share awards, net of repurchase for tax withholdings and tax benefit
|
|
48,325
|
|
|
(606
|
)
|
|
—
|
|
|
—
|
|
|
(606
|
)
|
||||
Cash dividends declared ($0.94 per share)
|
|
—
|
|
|
—
|
|
|
(14,644
|
)
|
|
—
|
|
|
(14,644
|
)
|
||||
Balance at December 31, 2017
|
|
15,524,704
|
|
|
$
|
156,904
|
|
|
$
|
266,723
|
|
|
$
|
(20,214
|
)
|
|
$
|
403,413
|
|
(1)
|
In the second quarter of 2016, the Company adopted ASU 2016-09, effective January 1, 2016. The Company made a policy election to not estimate the forfeiture rate in the accounting for share-based compensation on its unvested share-based awards. The change in policy was accounted for on a modified-retrospective basis and represents the cumulative effect adjustment to shareholders' equity.
|
(2)
|
In December of 2017, the Company early adopted ASU 2018-02, as a result, the Company made a policy election to release income tax effects, as a result of the Tax Act, from AOCI to retained earnings.
|
|
|
For The Year Ended
December 31,
|
||||||||||
(In thousands)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Operating Activities
|
|
|
|
|
|
|
|
|
|
|||
Net income
|
|
$
|
28,476
|
|
|
$
|
40,067
|
|
|
$
|
20,952
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|||||
Provision for credit losses
|
|
3,035
|
|
|
5,258
|
|
|
1,936
|
|
|||
Depreciation and amortization expense
|
|
3,761
|
|
|
4,426
|
|
|
3,614
|
|
|||
Purchase accounting accretion, net
|
|
(2,834
|
)
|
|
(5,048
|
)
|
|
(367
|
)
|
|||
Investment securities amortization and accretion, net
|
|
3,122
|
|
|
3,135
|
|
|
2,244
|
|
|||
Stock-based compensation expense
|
|
1,469
|
|
|
1,997
|
|
|
836
|
|
|||
Amortization of intangible assets
|
|
1,809
|
|
|
1,903
|
|
|
1,306
|
|
|||
Net gains on sale of investment securities
|
|
(855
|
)
|
|
(51
|
)
|
|
(4
|
)
|
|||
Net increase in other real estate owned valuation allowance and (gain) loss on disposition
|
|
(15
|
)
|
|
35
|
|
|
362
|
|
|||
Originations of mortgage loans held for sale
|
|
(211,568
|
)
|
|
(236,450
|
)
|
|
(72,032
|
)
|
|||
Proceeds from the sale of mortgage loans
|
|
224,883
|
|
|
238,351
|
|
|
62,485
|
|
|||
Gain on sale of mortgage loans, net of origination costs
|
|
(6,256
|
)
|
|
(6,201
|
)
|
|
(1,278
|
)
|
|||
Cost of fixed assets disposals associated with the SBM Financial, Inc. acquisition
|
|
—
|
|
|
—
|
|
|
1,130
|
|
|||
Income from bank-owned life insurance death benefits
|
|
—
|
|
|
(507
|
)
|
|
—
|
|
|||
Proceeds from bank-owned life insurance death benefits
|
|
—
|
|
|
1,092
|
|
|
—
|
|
|||
(Increase) decrease in other assets
|
|
12,060
|
|
|
11,836
|
|
|
(7,062
|
)
|
|||
Increase (decrease) in other liabilities
|
|
1,247
|
|
|
(1,333
|
)
|
|
1,796
|
|
|||
Net cash provided by operating activities
|
|
58,334
|
|
|
58,510
|
|
|
15,918
|
|
|||
Investing Activities
|
|
|
|
|
|
|
|
|
|
|||
Cash received in the SBM Financial, Inc. acquisition, net of cash paid
|
|
—
|
|
|
—
|
|
|
59,917
|
|
|||
Proceeds from sales and maturities of available-for-sale securities
|
|
154,973
|
|
|
184,564
|
|
|
156,434
|
|
|||
Purchase of available-for-sale securities
|
|
(170,495
|
)
|
|
(220,169
|
)
|
|
(111,170
|
)
|
|||
Purchase of securities held-to-maturity
|
|
—
|
|
|
(10,986
|
)
|
|
(64,355
|
)
|
|||
Net increase in loans
|
|
(187,740
|
)
|
|
(103,699
|
)
|
|
(94,811
|
)
|
|||
Proceeds from the sale of premises and equipment
|
|
137
|
|
|
90
|
|
|
—
|
|
|||
Purchase of premises and equipment
|
|
(2,844
|
)
|
|
(1,671
|
)
|
|
(3,189
|
)
|
|||
Purchase of Federal Home Loan Bank and Federal Reserve Bank stock
|
|
(12,290
|
)
|
|
(7,342
|
)
|
|
(1,594
|
)
|
|||
Proceeds from sale of Federal Home Loan Bank and Federal Reserve Bank stock
|
|
11,823
|
|
|
5,652
|
|
|
471
|
|
|||
Proceeds from sale of other real estate owned
|
|
808
|
|
|
730
|
|
|
2,825
|
|
|||
Recoveries of previously charged-off loans
|
|
497
|
|
|
486
|
|
|
728
|
|
|||
Purchase of bank-owned life insurance
|
|
(7,000
|
)
|
|
(16,700
|
)
|
|
—
|
|
|||
Net cash used in investing activities
|
|
(212,131
|
)
|
|
(169,045
|
)
|
|
(54,744
|
)
|
|||
Financing Activities
|
|
|
|
|
|
|
|
|
|
|||
Net increase in deposits
|
|
172,291
|
|
|
103,027
|
|
|
71,825
|
|
|||
Net proceeds from (repayments of) borrowings less than 90 days
|
|
36,699
|
|
|
77,227
|
|
|
(18,105
|
)
|
|||
Repayments on Federal Home Loan Bank long-term advances
|
|
(20,000
|
)
|
|
(25,000
|
)
|
|
(11,039
|
)
|
|||
Proceeds from Federal Home Loan Bank long-term advances
|
|
—
|
|
|
—
|
|
|
10,000
|
|
|||
Repayments of wholesale repurchase agreements
|
|
(5,000
|
)
|
|
(25,000
|
)
|
|
—
|
|
|||
Issuance of subordinated debt, net of costs
|
|
—
|
|
|
—
|
|
|
14,464
|
|
|||
Equity issuance costs
|
|
—
|
|
|
—
|
|
|
(612
|
)
|
|||
Exercise of stock options and issuance of restricted stock, net of repurchase for tax withholdings
|
|
(606
|
)
|
|
894
|
|
|
753
|
|
|||
Cash dividends paid on common stock and cash in lieu for fractional shares paid due to stock split
|
|
(14,323
|
)
|
|
(12,394
|
)
|
|
(9,785
|
)
|
|||
Net cash provided by financing activities
|
|
169,061
|
|
|
118,754
|
|
|
57,501
|
|
|||
Net increase in cash and cash equivalents
|
|
15,264
|
|
|
8,219
|
|
|
18,675
|
|
|||
Cash and cash equivalents at beginning of year
|
|
87,707
|
|
|
79,488
|
|
|
60,813
|
|
|||
Cash and cash equivalents at end of year
|
|
$
|
102,971
|
|
|
$
|
87,707
|
|
|
$
|
79,488
|
|
|
|
For The Year Ended
December 31,
|
||||||||||
(In thousands)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Supplemental information
|
|
|
|
|
|
|
|
|
|
|||
Interest paid
|
|
$
|
20,774
|
|
|
$
|
16,661
|
|
|
$
|
12,588
|
|
Income taxes paid
|
|
16,841
|
|
|
10,647
|
|
|
12,205
|
|
|||
Transfer of loans and premises to other real estate owned
|
|
—
|
|
|
383
|
|
|
2,175
|
|
|||
Measurement-period adjustments (Note 2)
|
|
—
|
|
|
960
|
|
|
—
|
|
|||
Assets acquired in the acquisition of SBM Financial, Inc., excluding net cash received (not adjusted for measurement-period adjustments)
|
|
—
|
|
|
—
|
|
|
729,283
|
|
|||
Liabilities assumed in the acquisition of SBM Financial Inc. (not adjusted for measurement-period adjustments)
|
|
—
|
|
|
—
|
|
|
729,500
|
|
|||
Common stock and stock options issued in connection with the SBM Financial, Inc. acquisition
|
|
—
|
|
|
—
|
|
|
110,551
|
|
AFS:
|
Available-for-sale
|
|
HPFC:
|
Healthcare Professional Funding Corporation, a wholly-owned subsidiary of Camden National Bank
|
ALCO:
|
Asset/Liability Committee
|
|
HTM:
|
Held-to-maturity
|
ALL:
|
Allowance for loan losses
|
|
IRS:
|
Internal Revenue Service
|
AOCI:
|
Accumulated other comprehensive income (loss)
|
|
LIBOR:
|
London Interbank Offered Rate
|
ASC:
|
Accounting Standards Codification
|
|
LTIP:
|
Long-Term Performance Share Plan
|
ASU:
|
Accounting Standards Update
|
|
Management ALCO:
|
Management Asset/Liability Committee
|
Bank:
|
Camden National Bank, a wholly-owned subsidiary of Camden National Corporation
|
|
MBS:
|
Mortgage-backed security
|
BOLI:
|
Bank-owned life insurance
|
|
MSPP:
|
Management Stock Purchase Plan
|
Board ALCO:
|
Board of Directors' Asset/Liability Committee
|
|
N.M.:
|
Not meaningful
|
CCTA:
|
Camden Capital Trust A, an unconsolidated entity formed by Camden National Corporation
|
|
OCC:
|
Office of the Comptroller of the Currency
|
CDs:
|
Certificate of deposits
|
|
OCI:
|
Other comprehensive income (loss)
|
Company:
|
Camden National Corporation
|
|
OREO:
|
Other real estate owned
|
CMO:
|
Collateralized mortgage obligation
|
|
OTTI:
|
Other-than-temporary impairment
|
DCRP:
|
Defined Contribution Retirement Plan
|
|
SBM:
|
SBM Financial, Inc., the parent company of The Bank of Maine
|
EPS:
|
Earnings per share
|
|
SERP:
|
Supplemental executive retirement plans
|
FASB:
|
Financial Accounting Standards Board
|
|
Tax Act:
|
Tax Cuts and Jobs Act of 2017, enacted on December 22, 2017
|
FDIC:
|
Federal Deposit Insurance Corporation
|
|
TDR:
|
Troubled-debt restructured loan
|
FHLB:
|
Federal Home Loan Bank
|
|
UBCT:
|
Union Bankshares Capital Trust I, an unconsolidated entity formed by Union Bankshares Company that was subsequently acquired by Camden National Corporation
|
FHLBB:
|
Federal Home Loan Bank of Boston
|
|
U.S.:
|
United States of America
|
FRB:
|
Federal Reserve System Board of Governors
|
|
2003 Plan:
|
2003 Stock Option and Incentive Plan
|
FRBB:
|
Federal Reserve Bank of Boston
|
|
2012 Plan:
|
2012 Equity and Incentive Plan
|
GAAP:
|
Generally accepted accounting principles in the United States
|
|
|
|
•
|
A change in the Company's assessment of its ALL and allowance on unused commitments as it will transition from an incurred loss model to an expected loss model, which may result in an increase in the ALL upon adoption and may negatively impact the Company and Bank's regulatory capital ratios.
|
•
|
May reduce the carrying value of the Company's HTM investment securities as it will require an allowance on the expected losses over the life of these securities to be recorded upon adoption.
|
•
|
Changes to the considerations when assessing AFS debt securities for OTTI, including (i) no longer considering the amount of time a security has been in an unrealized loss position and (ii) no longer considering the historical and implied volatility of a security and recoveries or declines in the fair value after the balance sheet date, as well as the presentation of OTTI as an allowance rather than a permanent write-down of the debt security.
|
•
|
Changes to the disclosure requirements to reflect the transition from an incurred loss methodology to an expected credit loss methodology, as well as certain disclosures of credit quality indicators in relation to the amortized cost of financing receivables disaggregated by year of origination (or vintage).
|
|
|
For The Year Ended
December 31,
|
||||||||||
|
|
2017
|
|
2016
|
|
2015
|
||||||
Salaries and employee benefits
(1)
|
|
$
|
—
|
|
|
$
|
8
|
|
|
$
|
3,240
|
|
Furniture, equipment and data processing
|
|
—
|
|
|
279
|
|
|
1,531
|
|
|||
Net occupancy
|
|
—
|
|
|
439
|
|
|
1,237
|
|
|||
Consulting and professional fees
(2)
|
|
—
|
|
|
80
|
|
|
2,453
|
|
|||
Other expenses
(3)
|
|
—
|
|
|
60
|
|
|
1,954
|
|
|||
Total merger and acquisition costs
|
|
$
|
—
|
|
|
$
|
866
|
|
|
$
|
10,415
|
|
(1)
|
Includes the costs associated with pre-existing change-in-control agreements in place at the time of the Merger and employee termination costs, including severance.
|
(2)
|
Includes the cost of a negotiated non-compete arrangement entered into in connection with the Merger of
$400,000
in 2015.
|
(3)
|
Other expenses include marketing and insurance costs, certain contract termination costs, various printing and mailing costs associated with various customer communications, and travel-related costs associated with the integration of the
two
companies in 2015.
|
|
|
As Acquired
|
|
Fair Value Adjustments
(Previously Reported)
|
|
Measurement-Period Adjustments
|
|
As Recorded at Acquisition
|
||||||||
Consideration Paid:
|
|
|
|
|
|
|
|
|
||||||||
Cash
|
|
|
|
|
|
|
|
$
|
26,125
|
|
||||||
Company common stock
(4,124,643 shares at $26.32 per share)
|
|
|
|
|
|
|
|
108,561
|
|
|||||||
Non-qualified stock options
|
|
|
|
|
|
|
|
1,990
|
|
|||||||
Total consideration paid
|
|
|
|
|
|
|
|
136,676
|
|
|||||||
Recognized identifiable assets acquired and liabilities assumed,
at fair value:
|
|
|
|
|
|
|
|
|
||||||||
Loans and loans held for sale
|
|
$
|
639,390
|
|
|
$
|
(11,497
|
)
|
|
$
|
137
|
|
|
628,030
|
|
|
Cash and due from banks
|
|
86,042
|
|
|
—
|
|
|
—
|
|
|
86,042
|
|
||||
Investments
|
|
39,716
|
|
|
26
|
|
|
—
|
|
|
39,742
|
|
||||
Deferred tax assets
|
|
26,293
|
|
|
(1,177
|
)
|
|
666
|
|
|
25,782
|
|
||||
Premises and equipment
|
|
16,851
|
|
|
7,093
|
|
|
—
|
|
|
23,944
|
|
||||
OREO
|
|
2,530
|
|
|
(1,801
|
)
|
|
—
|
|
|
729
|
|
||||
Core deposit intangible assets
|
|
—
|
|
|
6,608
|
|
|
—
|
|
|
6,608
|
|
||||
Other assets
|
|
5,421
|
|
|
(170
|
)
|
|
157
|
|
|
5,408
|
|
||||
Deposits and borrowings
|
|
719,640
|
|
|
1,546
|
|
|
—
|
|
|
721,186
|
|
||||
Other liabilities
|
|
8,512
|
|
|
(198
|
)
|
|
—
|
|
|
8,314
|
|
||||
Total identified assets acquired and liabilities assumed,
at fair value
|
|
$
|
88,091
|
|
|
$
|
(2,266
|
)
|
|
$
|
960
|
|
|
86,785
|
|
|
Goodwill
|
|
|
|
|
|
|
|
$
|
49,891
|
|
|
Amortized Cost
|
|
Unrealized Gains
|
|
Unrealized Losses
|
|
Fair
Value
|
||||||||
December 31, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
||||
AFS Securities:
|
|
|
|
|
|
|
|
||||||||
Obligations of states and political subdivisions
|
$
|
7,232
|
|
|
$
|
103
|
|
|
$
|
—
|
|
|
$
|
7,335
|
|
Mortgage-backed securities issued or guaranteed by U.S. government-sponsored enterprises
|
510,176
|
|
|
597
|
|
|
(7,471
|
)
|
|
503,302
|
|
||||
Collateralized mortgage obligations issued or guaranteed by U.S. government-sponsored enterprises
|
279,575
|
|
|
14
|
|
|
(6,790
|
)
|
|
272,799
|
|
||||
Subordinated corporate bonds
|
5,484
|
|
|
173
|
|
|
—
|
|
|
5,657
|
|
||||
Total AFS debt securities
|
802,467
|
|
|
887
|
|
|
(14,261
|
)
|
|
789,093
|
|
||||
Equity securities
|
554
|
|
|
252
|
|
|
—
|
|
|
806
|
|
||||
Total AFS securities
|
$
|
803,021
|
|
|
$
|
1,139
|
|
|
$
|
(14,261
|
)
|
|
$
|
789,899
|
|
HTM Securities:
|
|
|
|
|
|
|
|
||||||||
Obligations of states and political subdivisions
|
$
|
94,073
|
|
|
$
|
1,077
|
|
|
$
|
(237
|
)
|
|
$
|
94,913
|
|
Total HTM securities
|
$
|
94,073
|
|
|
$
|
1,077
|
|
|
$
|
(237
|
)
|
|
$
|
94,913
|
|
December 31, 2016:
|
|
|
|
|
|
|
|
|
|
|
|
||||
AFS Securities:
|
|
|
|
|
|
|
|
||||||||
Obligations of states and political subdivisions
|
$
|
8,848
|
|
|
$
|
153
|
|
|
$
|
—
|
|
|
$
|
9,001
|
|
Mortgage-backed securities issued or guaranteed by U.S. government-sponsored enterprises
|
485,222
|
|
|
2,515
|
|
|
(7,115
|
)
|
|
480,622
|
|
||||
Collateralized mortgage obligations issued or guaranteed by U.S. government-sponsored enterprises
|
289,046
|
|
|
265
|
|
|
(5,421
|
)
|
|
283,890
|
|
||||
Subordinated corporate bonds
|
5,481
|
|
|
132
|
|
|
—
|
|
|
5,613
|
|
||||
Total AFS debt securities
|
788,597
|
|
|
3,065
|
|
|
(12,536
|
)
|
|
779,126
|
|
||||
Equity securities
|
632
|
|
|
109
|
|
|
—
|
|
|
741
|
|
||||
Total AFS securities
|
$
|
789,229
|
|
|
$
|
3,174
|
|
|
$
|
(12,536
|
)
|
|
$
|
779,867
|
|
HTM Securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Obligations of states and political subdivisions
|
$
|
94,609
|
|
|
$
|
618
|
|
|
$
|
(631
|
)
|
|
$
|
94,596
|
|
Total HTM securities
|
$
|
94,609
|
|
|
$
|
618
|
|
|
$
|
(631
|
)
|
|
$
|
94,596
|
|
|
Less Than 12 Months
|
|
12 Months or More
|
|
Total
|
||||||||||||||||||
|
Fair Value
|
|
Unrealized Losses
|
|
Fair Value
|
|
Unrealized Losses
|
|
Fair Value
|
|
Unrealized Losses
|
||||||||||||
December 31, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
AFS Securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Mortgage-backed securities issued or guaranteed by U.S. government-sponsored enterprises
|
$
|
221,466
|
|
|
$
|
(2,393
|
)
|
|
$
|
233,971
|
|
|
$
|
(5,078
|
)
|
|
$
|
455,437
|
|
|
$
|
(7,471
|
)
|
Collateralized mortgage obligations issued or guaranteed by U.S. government-sponsored enterprises
|
102,612
|
|
|
(696
|
)
|
|
164,389
|
|
|
(6,094
|
)
|
|
267,001
|
|
|
(6,790
|
)
|
||||||
Total AFS securities
|
$
|
324,078
|
|
|
$
|
(3,089
|
)
|
|
$
|
398,360
|
|
|
$
|
(11,172
|
)
|
|
$
|
722,438
|
|
|
$
|
(14,261
|
)
|
HTM Securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Obligations of states and political subdivisions
|
$
|
9,317
|
|
|
$
|
(57
|
)
|
|
$
|
9,436
|
|
|
$
|
(180
|
)
|
|
$
|
18,753
|
|
|
$
|
(237
|
)
|
Total HTM securities
|
$
|
9,317
|
|
|
$
|
(57
|
)
|
|
$
|
9,436
|
|
|
$
|
(180
|
)
|
|
$
|
18,753
|
|
|
$
|
(237
|
)
|
December 31, 2016:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
AFS Securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Mortgage-backed securities issued or guaranteed by U.S. government-sponsored enterprises
|
$
|
348,579
|
|
|
$
|
(5,780
|
)
|
|
$
|
29,496
|
|
|
$
|
(1,335
|
)
|
|
$
|
378,075
|
|
|
$
|
(7,115
|
)
|
Collateralized mortgage obligations issued or guaranteed by U.S. government-sponsored enterprises
|
163,412
|
|
|
(2,906
|
)
|
|
74,212
|
|
|
(2,515
|
)
|
|
237,624
|
|
|
(5,421
|
)
|
||||||
Total AFS securities
|
$
|
511,991
|
|
|
$
|
(8,686
|
)
|
|
$
|
103,708
|
|
|
$
|
(3,850
|
)
|
|
$
|
615,699
|
|
|
$
|
(12,536
|
)
|
HTM Securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Obligations of states and political subdivisions
|
$
|
42,805
|
|
|
$
|
(631
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
42,805
|
|
|
$
|
(631
|
)
|
Total HTM securities
|
$
|
42,805
|
|
|
$
|
(631
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
42,805
|
|
|
$
|
(631
|
)
|
|
For The Year Ended
December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Proceeds from sales of securities
|
$
|
20,366
|
|
|
$
|
28,850
|
|
|
$
|
12,426
|
|
Gross realized gains
|
869
|
|
|
125
|
|
|
221
|
|
|||
Gross realized losses
|
(14
|
)
|
|
(74
|
)
|
|
(217
|
)
|
|||
Previously recorded OTTI
|
—
|
|
|
—
|
|
|
204
|
|
|
Amortized Cost
|
|
Fair
Value
|
||||
AFS Securities
|
|
|
|
||||
Due in one year or less
|
$
|
4,986
|
|
|
$
|
4,983
|
|
Due after one year through five years
|
104,294
|
|
|
103,572
|
|
||
Due after five years through ten years
|
212,809
|
|
|
209,663
|
|
||
Due after ten years
|
480,378
|
|
|
470,875
|
|
||
|
$
|
802,467
|
|
|
$
|
789,093
|
|
HTM Securities
|
|
|
|
||||
Due in one year or less
|
$
|
751
|
|
|
$
|
751
|
|
Due after one year through five years
|
4,705
|
|
|
4,721
|
|
||
Due after five years through ten years
|
10,110
|
|
|
10,192
|
|
||
Due after ten years
|
78,507
|
|
|
79,249
|
|
||
|
$
|
94,073
|
|
|
$
|
94,913
|
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
Residential real estate loans
|
$
|
858,369
|
|
|
$
|
802,494
|
|
Commercial real estate loans
|
1,164,023
|
|
|
1,050,780
|
|
||
Commercial loans
|
373,400
|
|
|
333,639
|
|
||
Home equity loans
|
323,378
|
|
|
329,907
|
|
||
Consumer loans
|
18,149
|
|
|
17,332
|
|
||
HPFC
|
45,120
|
|
|
60,412
|
|
||
Total loans
|
$
|
2,782,439
|
|
|
$
|
2,594,564
|
|
|
|
December 31,
|
||||||
|
|
2017
|
|
2016
|
||||
Net unamortized fair value mark discount on acquired loans
|
|
$
|
6,207
|
|
|
$
|
8,810
|
|
Net unamortized loan origination costs
|
|
(963
|
)
|
|
(66
|
)
|
||
Total
|
|
$
|
5,244
|
|
|
$
|
8,744
|
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
Balance at beginning of year
|
$
|
15,942
|
|
|
$
|
16,628
|
|
Loans made/advanced and additions
|
230
|
|
|
434
|
|
||
Repayments and reductions
|
(3,032
|
)
|
|
(1,120
|
)
|
||
Balance at end of year
|
$
|
13,140
|
|
|
$
|
15,942
|
|
|
Residential Real Estate
|
|
Commercial Real Estate
|
|
Commercial
|
|
Home
Equity
|
|
Consumer
|
|
HPFC
|
|
Unallocated
|
|
Total
|
||||||||||||||||
For The Year Ended
December 31, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
ALL:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Beginning balance
|
$
|
4,160
|
|
|
$
|
12,154
|
|
|
$
|
3,755
|
|
|
$
|
2,194
|
|
|
$
|
181
|
|
|
$
|
672
|
|
|
$
|
—
|
|
|
$
|
23,116
|
|
Loans charged off
|
(482
|
)
|
|
(124
|
)
|
|
(1,014
|
)
|
|
(434
|
)
|
|
(124
|
)
|
|
(290
|
)
|
|
—
|
|
|
(2,468
|
)
|
||||||||
Recoveries
|
30
|
|
|
141
|
|
|
301
|
|
|
2
|
|
|
17
|
|
|
6
|
|
|
—
|
|
|
497
|
|
||||||||
Provision (credit)
(1)
|
1,378
|
|
|
(308
|
)
|
|
1,129
|
|
|
605
|
|
|
159
|
|
|
63
|
|
|
—
|
|
|
3,026
|
|
||||||||
Ending balance
|
$
|
5,086
|
|
|
$
|
11,863
|
|
|
$
|
4,171
|
|
|
$
|
2,367
|
|
|
$
|
233
|
|
|
$
|
451
|
|
|
$
|
—
|
|
|
$
|
24,171
|
|
ALL balance attributable loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Individually evaluated for impairment
|
$
|
568
|
|
|
$
|
1,441
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,009
|
|
Collectively evaluated for impairment
|
4,518
|
|
|
10,422
|
|
|
4,171
|
|
|
2,367
|
|
|
233
|
|
|
451
|
|
|
—
|
|
|
22,162
|
|
||||||||
Total ending ALL
|
$
|
5,086
|
|
|
$
|
11,863
|
|
|
$
|
4,171
|
|
|
$
|
2,367
|
|
|
$
|
233
|
|
|
$
|
451
|
|
|
$
|
—
|
|
|
$
|
24,171
|
|
Loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Individually evaluated for impairment
|
$
|
5,171
|
|
|
$
|
6,199
|
|
|
$
|
1,791
|
|
|
$
|
429
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
13,590
|
|
Collectively evaluated for impairment
|
853,198
|
|
|
1,157,824
|
|
|
371,609
|
|
|
322,949
|
|
|
18,149
|
|
|
45,120
|
|
|
—
|
|
|
2,768,849
|
|
||||||||
Total loan balances
|
$
|
858,369
|
|
|
$
|
1,164,023
|
|
|
$
|
373,400
|
|
|
$
|
323,378
|
|
|
$
|
18,149
|
|
|
$
|
45,120
|
|
|
$
|
—
|
|
|
$
|
2,782,439
|
|
For The Year Ended
December 31, 2016:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
ALL:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Beginning balance
|
$
|
4,545
|
|
|
$
|
10,432
|
|
|
$
|
3,241
|
|
|
$
|
2,731
|
|
|
$
|
193
|
|
|
$
|
24
|
|
|
$
|
—
|
|
|
$
|
21,166
|
|
Loans charged off
|
(356
|
)
|
|
(315
|
)
|
|
(2,218
|
)
|
|
(308
|
)
|
|
(101
|
)
|
|
(507
|
)
|
|
—
|
|
|
(3,805
|
)
|
||||||||
Recoveries
|
95
|
|
|
50
|
|
|
332
|
|
|
2
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
486
|
|
||||||||
Provision (credit)
(1)
|
(124
|
)
|
|
1,987
|
|
|
2,400
|
|
|
(231
|
)
|
|
82
|
|
|
1,155
|
|
|
—
|
|
|
5,269
|
|
||||||||
Ending balance
|
$
|
4,160
|
|
|
$
|
12,154
|
|
|
$
|
3,755
|
|
|
$
|
2,194
|
|
|
$
|
181
|
|
|
$
|
672
|
|
|
$
|
—
|
|
|
$
|
23,116
|
|
ALL balance attributable loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Individually evaluated for impairment
|
$
|
483
|
|
|
$
|
1,373
|
|
|
$
|
—
|
|
|
$
|
86
|
|
|
$
|
—
|
|
|
$
|
65
|
|
|
$
|
—
|
|
|
$
|
2,007
|
|
Collectively evaluated for impairment
|
3,677
|
|
|
10,781
|
|
|
3,755
|
|
|
2,108
|
|
|
181
|
|
|
607
|
|
|
—
|
|
|
21,109
|
|
||||||||
Total ending ALL
|
$
|
4,160
|
|
|
$
|
12,154
|
|
|
$
|
3,755
|
|
|
$
|
2,194
|
|
|
$
|
181
|
|
|
$
|
672
|
|
|
$
|
—
|
|
|
$
|
23,116
|
|
Loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Individually evaluated for impairment
|
$
|
4,348
|
|
|
$
|
13,317
|
|
|
$
|
2,028
|
|
|
$
|
457
|
|
|
$
|
7
|
|
|
$
|
97
|
|
|
$
|
—
|
|
|
$
|
20,254
|
|
Collectively evaluated for impairment
|
798,146
|
|
|
1,037,463
|
|
|
331,611
|
|
|
329,450
|
|
|
17,325
|
|
|
60,315
|
|
|
—
|
|
|
2,574,310
|
|
||||||||
Total loan balances
|
$
|
802,494
|
|
|
$
|
1,050,780
|
|
|
$
|
333,639
|
|
|
$
|
329,907
|
|
|
$
|
17,332
|
|
|
$
|
60,412
|
|
|
$
|
—
|
|
|
$
|
2,594,564
|
|
|
Residential Real Estate
|
|
Commercial Real Estate
|
|
Commercial
|
|
Home
Equity
|
|
Consumer
|
|
HPFC
|
|
Unallocated
|
|
Total
|
||||||||||||||||
For The Year Ended December 31, 2015:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
ALL:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Beginning balance
|
$
|
4,899
|
|
|
$
|
7,951
|
|
|
$
|
3,354
|
|
|
$
|
2,247
|
|
|
$
|
281
|
|
|
$
|
—
|
|
|
$
|
2,384
|
|
|
$
|
21,116
|
|
Loans charged off
|
(801
|
)
|
|
(481
|
)
|
|
(655
|
)
|
|
(525
|
)
|
|
(154
|
)
|
|
—
|
|
|
—
|
|
|
(2,616
|
)
|
||||||||
Recoveries
|
55
|
|
|
74
|
|
|
389
|
|
|
188
|
|
|
22
|
|
|
—
|
|
|
—
|
|
|
728
|
|
||||||||
Provision (credit)
(1)
|
392
|
|
|
2,888
|
|
|
153
|
|
|
821
|
|
|
44
|
|
|
24
|
|
|
(2,384
|
)
|
|
1,938
|
|
||||||||
Ending balance
|
$
|
4,545
|
|
|
$
|
10,432
|
|
|
$
|
3,241
|
|
|
$
|
2,731
|
|
|
$
|
193
|
|
|
$
|
24
|
|
|
$
|
—
|
|
|
$
|
21,166
|
|
ALL balance attributable loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Individually evaluated for impairment
|
$
|
544
|
|
|
$
|
644
|
|
|
$
|
92
|
|
|
$
|
89
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,369
|
|
Collectively evaluated for impairment
|
4,001
|
|
|
9,788
|
|
|
3,149
|
|
|
2,642
|
|
|
193
|
|
|
24
|
|
|
—
|
|
|
19,797
|
|
||||||||
Total ending ALL
|
$
|
4,545
|
|
|
$
|
10,432
|
|
|
$
|
3,241
|
|
|
$
|
2,731
|
|
|
$
|
193
|
|
|
$
|
24
|
|
|
$
|
—
|
|
|
$
|
21,166
|
|
Loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Individually evaluated for impairment
|
$
|
6,026
|
|
|
$
|
4,610
|
|
|
$
|
3,937
|
|
|
$
|
588
|
|
|
$
|
74
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
15,235
|
|
Collectively evaluated for impairment
|
814,591
|
|
|
923,341
|
|
|
293,784
|
|
|
348,046
|
|
|
17,879
|
|
|
77,330
|
|
|
—
|
|
|
2,474,971
|
|
||||||||
Total loan balances
|
$
|
820,617
|
|
|
$
|
927,951
|
|
|
$
|
297,721
|
|
|
$
|
348,634
|
|
|
$
|
17,953
|
|
|
$
|
77,330
|
|
|
$
|
—
|
|
|
$
|
2,490,206
|
|
(1)
|
The provision (credit) for loan losses excludes any impact for the change in the reserve for unfunded commitments, which represents management's estimate of the amount required to reflect the probable inherent losses on outstanding letters of credit and unused lines of credit. The reserve for unfunded commitments is presented within accrued interest and other liabilities on the consolidated statements of condition. At
December 31, 2017
,
2016
, and
2015
, the reserve for unfunded commitments was
$20,000
,
$11,000
and
$22,000
, respectively.
|
|
|
|
For the Year Ended
December 31,
|
||||||||||
|
|
|
2017
|
|
2016
|
|
2015
|
||||||
Provision for loan losses
|
|
|
$
|
3,026
|
|
|
$
|
5,269
|
|
|
$
|
1,938
|
|
Change in reserve for unfunded commitments
|
|
|
9
|
|
|
(11
|
)
|
|
(2
|
)
|
|||
Provision for credit losses
|
|
|
$
|
3,035
|
|
|
$
|
5,258
|
|
|
$
|
1,936
|
|
•
|
Grade 1 through 6 — Grades 1 through 6 represent groups of loans that are not subject to adverse criticism as defined in regulatory guidance. Loans in these groups exhibit characteristics that represent low to moderate risks, which is measured using a variety of credit risk criteria, such as cash flow coverage, debt service coverage, balance sheet leverage, liquidity, management experience, industry position, prevailing economic conditions, support from secondary sources of repayment and other credit factors that may be relevant to a specific loan. In general, these loans are supported by properly margined collateral and guarantees of principal parties.
|
•
|
Grade 7 — Loans with potential weakness (Special Mention). Loans in this category are currently protected based on collateral and repayment capacity and do not constitute undesirable credit risk, but have potential weakness that may result in deterioration of the repayment process at some future date. This classification is used if a negative trend is evident in the obligor’s financial situation. Special mention loans do not sufficiently expose the Company to warrant adverse classification.
|
•
|
Grade 8 — Loans with definite weakness (Substandard). Loans classified as substandard are inadequately protected by the current sound worth and paying capacity of the obligor or by collateral pledged. Borrowers experience difficulty in meeting debt repayment requirements. Deterioration is sufficient to cause the Company to look to the sale of collateral.
|
•
|
Grade 9 — Loans with potential loss (Doubtful). Loans classified as doubtful have all the weaknesses inherent in the substandard grade with the added characteristic that the weaknesses make collection or liquidation of the loan in full highly questionable and improbable. The possibility of some loss is extremely high, but because of specific pending factors that may work to the advantage and strengthening of the asset, its classification as an estimated loss is deferred until its more exact status may be determined.
|
•
|
Grade 10 — Loans with definite loss (Loss). Loans classified as loss are considered uncollectible. The loss classification does not mean that the asset has absolutely no recovery or salvage value, but rather that it is not practical or desirable to defer writing off the asset because recovery and collection time may be protracted.
|
|
|
Residential Real Estate
|
|
Commercial Real Estate
|
|
Commercial
|
|
Home Equity
|
|
Consumer
|
|
HPFC
|
|
Total
|
||||||||||||||
December 31, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Pass (Grades 1 – 6)
|
|
$
|
846,394
|
|
|
$
|
1,130,235
|
|
|
$
|
354,904
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
43,049
|
|
|
$
|
2,374,582
|
|
Performing
|
|
—
|
|
|
—
|
|
|
—
|
|
|
321,727
|
|
|
18,149
|
|
|
—
|
|
|
339,876
|
|
|||||||
Special Mention (Grade 7)
|
|
922
|
|
|
9,154
|
|
|
12,517
|
|
|
—
|
|
|
—
|
|
|
191
|
|
|
22,784
|
|
|||||||
Substandard (Grade 8)
|
|
11,053
|
|
|
24,634
|
|
|
5,979
|
|
|
—
|
|
|
—
|
|
|
1,880
|
|
|
43,546
|
|
|||||||
Non-performing
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,651
|
|
|
—
|
|
|
—
|
|
|
1,651
|
|
|||||||
Total
|
|
$
|
858,369
|
|
|
$
|
1,164,023
|
|
|
$
|
373,400
|
|
|
$
|
323,378
|
|
|
$
|
18,149
|
|
|
$
|
45,120
|
|
|
$
|
2,782,439
|
|
December 31, 2016:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Pass (Grades 1 – 6)
|
|
$
|
789,554
|
|
|
$
|
1,003,386
|
|
|
$
|
321,148
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
58,943
|
|
|
$
|
2,173,031
|
|
Performing
|
|
—
|
|
|
—
|
|
|
—
|
|
|
328,287
|
|
|
17,328
|
|
|
—
|
|
|
345,615
|
|
|||||||
Special Mention (Grade 7)
|
|
2,387
|
|
|
5,724
|
|
|
5,598
|
|
|
—
|
|
|
—
|
|
|
257
|
|
|
13,966
|
|
|||||||
Substandard (Grade 8)
|
|
10,553
|
|
|
41,670
|
|
|
5,437
|
|
|
—
|
|
|
—
|
|
|
1,212
|
|
|
58,872
|
|
|||||||
Doubtful (Grade 9)
|
|
—
|
|
|
—
|
|
|
1,456
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,456
|
|
|||||||
Non-performing
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,620
|
|
|
4
|
|
|
—
|
|
|
1,624
|
|
|||||||
Total
|
|
$
|
802,494
|
|
|
$
|
1,050,780
|
|
|
$
|
333,639
|
|
|
$
|
329,907
|
|
|
$
|
17,332
|
|
|
$
|
60,412
|
|
|
$
|
2,594,564
|
|
|
30 – 59 Days Past Due
|
|
60 – 89 Days Past Due
|
|
Greater Than 90 Days
|
|
Total Past Due
|
|
Current
|
|
Total Loans Outstanding
|
|
Loans > 90 Days Past Due and Accruing
|
|
Non-Accrual Loans
|
||||||||||||||||
December 31, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Residential real estate
|
$
|
3,871
|
|
|
$
|
1,585
|
|
|
$
|
4,021
|
|
|
$
|
9,477
|
|
|
$
|
848,892
|
|
|
$
|
858,369
|
|
|
$
|
—
|
|
|
$
|
4,979
|
|
Commercial real estate
|
849
|
|
|
323
|
|
|
5,528
|
|
|
6,700
|
|
|
1,157,323
|
|
|
1,164,023
|
|
|
—
|
|
|
5,642
|
|
||||||||
Commercial
|
329
|
|
|
359
|
|
|
1,535
|
|
|
2,223
|
|
|
371,177
|
|
|
373,400
|
|
|
—
|
|
|
2,000
|
|
||||||||
Home equity
|
1,046
|
|
|
173
|
|
|
1,329
|
|
|
2,548
|
|
|
320,830
|
|
|
323,378
|
|
|
—
|
|
|
1,650
|
|
||||||||
Consumer
|
57
|
|
|
10
|
|
|
—
|
|
|
67
|
|
|
18,082
|
|
|
18,149
|
|
|
—
|
|
|
—
|
|
||||||||
HPFC
|
139
|
|
|
1,372
|
|
|
419
|
|
|
1,930
|
|
|
43,190
|
|
|
45,120
|
|
|
—
|
|
|
1,043
|
|
||||||||
Total
|
$
|
6,291
|
|
|
$
|
3,822
|
|
|
$
|
12,832
|
|
|
$
|
22,945
|
|
|
$
|
2,759,494
|
|
|
$
|
2,782,439
|
|
|
$
|
—
|
|
|
$
|
15,314
|
|
December 31, 2016:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Residential real estate
|
$
|
1,783
|
|
|
$
|
924
|
|
|
$
|
2,904
|
|
|
$
|
5,611
|
|
|
$
|
796,883
|
|
|
$
|
802,494
|
|
|
$
|
—
|
|
|
$
|
3,945
|
|
Commercial real estate
|
855
|
|
|
223
|
|
|
12,625
|
|
|
13,703
|
|
|
1,037,077
|
|
|
1,050,780
|
|
|
—
|
|
|
12,849
|
|
||||||||
Commercial
|
633
|
|
|
218
|
|
|
1,675
|
|
|
2,526
|
|
|
331,113
|
|
|
333,639
|
|
|
—
|
|
|
2,088
|
|
||||||||
Home equity
|
892
|
|
|
134
|
|
|
1,321
|
|
|
2,347
|
|
|
327,560
|
|
|
329,907
|
|
|
—
|
|
|
1,620
|
|
||||||||
Consumer
|
38
|
|
|
—
|
|
|
4
|
|
|
42
|
|
|
17,290
|
|
|
17,332
|
|
|
—
|
|
|
4
|
|
||||||||
HPFC
|
438
|
|
|
688
|
|
|
110
|
|
|
1,236
|
|
|
59,176
|
|
|
60,412
|
|
|
—
|
|
|
207
|
|
||||||||
Total
|
$
|
4,639
|
|
|
$
|
2,187
|
|
|
$
|
18,639
|
|
|
$
|
25,465
|
|
|
$
|
2,569,099
|
|
|
$
|
2,594,564
|
|
|
$
|
—
|
|
|
$
|
20,713
|
|
|
|
Number of Contracts
|
|
Recorded Investment
|
|
Specific Reserve
|
||||||||||||||||
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||||
Residential real estate
|
|
24
|
|
|
21
|
|
|
$
|
3,604
|
|
|
$
|
3,221
|
|
|
$
|
452
|
|
|
$
|
483
|
|
Commercial real estate
|
|
3
|
|
|
3
|
|
|
976
|
|
|
1,008
|
|
|
16
|
|
|
—
|
|
||||
Commercial
|
|
7
|
|
|
10
|
|
|
1,345
|
|
|
1,502
|
|
|
—
|
|
|
—
|
|
||||
Consumer and home equity
|
|
2
|
|
|
1
|
|
|
307
|
|
|
16
|
|
|
—
|
|
|
—
|
|
||||
Total
|
|
36
|
|
|
35
|
|
|
$
|
6,232
|
|
|
$
|
5,747
|
|
|
$
|
468
|
|
|
$
|
483
|
|
|
|
Number of Contracts
|
|
Pre-Modification
Outstanding
Recorded Investment
|
|
Post-Modification
Outstanding
Recorded Investment
|
|
Specific Reserve
|
|||||||||||||||||||||||||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
2017
|
|
2016
|
|
2015
|
|
2017
|
|
2016
|
|
2015
|
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||||||||
Residential real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Maturity concession
|
|
2
|
|
|
—
|
|
|
—
|
|
|
$
|
298
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
298
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
15
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Court ordered
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
74
|
|
|
—
|
|
|
—
|
|
|
78
|
|
|
—
|
|
|
—
|
|
|
27
|
|
|||||||||
Interest rate concession
|
|
1
|
|
|
—
|
|
|
—
|
|
|
134
|
|
|
—
|
|
|
—
|
|
|
145
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Interest rate and maturity concession
|
|
1
|
|
|
—
|
|
|
—
|
|
|
148
|
|
|
—
|
|
|
—
|
|
|
156
|
|
|
—
|
|
|
—
|
|
|
30
|
|
|
—
|
|
|
—
|
|
|||||||||
Commercial:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Maturity concession
|
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
2,973
|
|
|
—
|
|
|
—
|
|
|
2,973
|
|
|
—
|
|
|
—
|
|
|
1,400
|
|
|
—
|
|
|||||||||
Home equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Interest rate and maturity concession
|
|
1
|
|
|
—
|
|
|
—
|
|
|
315
|
|
|
—
|
|
|
—
|
|
|
315
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Total
|
|
5
|
|
|
6
|
|
|
1
|
|
|
$
|
895
|
|
|
$
|
2,973
|
|
|
$
|
74
|
|
|
$
|
914
|
|
|
$
|
2,973
|
|
|
$
|
78
|
|
|
$
|
45
|
|
|
$
|
1,400
|
|
|
$
|
27
|
|
|
|
Recorded Investment
|
|
Unpaid Principal Balance
|
|
Related Allowance
|
|
Average Recorded Investment
|
|
Interest Income Recognized
|
||||||||||
December 31, 2017:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
With related allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Residential real estate
|
|
$
|
3,858
|
|
|
$
|
3,858
|
|
|
$
|
568
|
|
|
$
|
3,177
|
|
|
$
|
131
|
|
Commercial real estate
|
|
5,422
|
|
|
5,422
|
|
|
1,441
|
|
|
8,900
|
|
|
22
|
|
|||||
Commercial
|
|
—
|
|
|
—
|
|
|
—
|
|
|
31
|
|
|
—
|
|
|||||
Home equity
|
|
—
|
|
|
—
|
|
|
—
|
|
|
125
|
|
|
—
|
|
|||||
Consumer
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
HPFC
|
|
—
|
|
|
—
|
|
|
—
|
|
|
24
|
|
|
—
|
|
|||||
Ending balance
|
|
9,280
|
|
|
9,280
|
|
|
2,009
|
|
|
12,257
|
|
|
153
|
|
|||||
Without related allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Residential real estate
|
|
1,313
|
|
|
1,673
|
|
|
—
|
|
|
1,345
|
|
|
15
|
|
|||||
Commercial real estate
|
|
777
|
|
|
1,084
|
|
|
—
|
|
|
1,132
|
|
|
29
|
|
|||||
Commercial
|
|
1,791
|
|
|
2,964
|
|
|
—
|
|
|
1,920
|
|
|
10
|
|
|||||
Home equity
|
|
429
|
|
|
495
|
|
|
—
|
|
|
310
|
|
|
8
|
|
|||||
Consumer
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|||||
HPFC
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Ending balance
|
|
4,310
|
|
|
6,216
|
|
|
—
|
|
|
4,709
|
|
|
62
|
|
|||||
Total impaired loans
|
|
$
|
13,590
|
|
|
$
|
15,496
|
|
|
$
|
2,009
|
|
|
$
|
16,966
|
|
|
$
|
215
|
|
December 31, 2016:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
With related allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Residential real estate
|
|
$
|
3,019
|
|
|
$
|
3,019
|
|
|
$
|
483
|
|
|
$
|
3,088
|
|
|
$
|
106
|
|
Commercial real estate
|
|
11,443
|
|
|
11,443
|
|
|
1,373
|
|
|
5,165
|
|
|
—
|
|
|||||
Commercial
|
|
—
|
|
|
—
|
|
|
—
|
|
|
762
|
|
|
—
|
|
|||||
Home equity
|
|
299
|
|
|
299
|
|
|
86
|
|
|
305
|
|
|
—
|
|
|||||
Consumer
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
HPFC
|
|
97
|
|
|
97
|
|
|
65
|
|
|
98
|
|
|
—
|
|
|||||
Ending balance
|
|
14,858
|
|
|
14,858
|
|
|
2,007
|
|
|
9,418
|
|
|
106
|
|
|||||
Without related allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Residential real estate
|
|
1,329
|
|
|
1,800
|
|
|
—
|
|
|
2,057
|
|
|
9
|
|
|||||
Commercial real estate
|
|
1,874
|
|
|
2,369
|
|
|
—
|
|
|
2,214
|
|
|
51
|
|
|||||
Commercial
|
|
2,028
|
|
|
3,209
|
|
|
—
|
|
|
2,507
|
|
|
16
|
|
|||||
Home equity
|
|
158
|
|
|
368
|
|
|
—
|
|
|
180
|
|
|
—
|
|
|||||
Consumer
|
|
7
|
|
|
10
|
|
|
—
|
|
|
12
|
|
|
—
|
|
|||||
HPFC
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Ending balance
|
|
5,396
|
|
|
7,756
|
|
|
—
|
|
|
6,970
|
|
|
76
|
|
|||||
Total impaired loans
|
|
$
|
20,254
|
|
|
$
|
22,614
|
|
|
$
|
2,007
|
|
|
$
|
16,388
|
|
|
$
|
182
|
|
|
|
Recorded Investment
|
|
Unpaid Principal Balance
|
|
Related Allowance
|
|
Average Recorded Investment
|
|
Interest Income Recognized
|
||||||||||
December 31, 2015:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
With related allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Residential real estate
|
|
$
|
3,191
|
|
|
$
|
3,191
|
|
|
$
|
544
|
|
|
$
|
6,064
|
|
|
$
|
112
|
|
Commercial real estate
|
|
1,825
|
|
|
1,857
|
|
|
644
|
|
|
1,753
|
|
|
—
|
|
|||||
Commercial
|
|
156
|
|
|
156
|
|
|
92
|
|
|
945
|
|
|
2
|
|
|||||
Home equity
|
|
303
|
|
|
303
|
|
|
89
|
|
|
900
|
|
|
—
|
|
|||||
Consumer
|
|
—
|
|
|
—
|
|
|
—
|
|
|
195
|
|
|
—
|
|
|||||
HPFC
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Ending balance
|
|
5,475
|
|
|
5,507
|
|
|
1,369
|
|
|
9,857
|
|
|
114
|
|
|||||
Without related allowance recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Residential real estate
|
|
2,835
|
|
|
4,353
|
|
|
—
|
|
|
2,175
|
|
|
8
|
|
|||||
Commercial real estate
|
|
2,785
|
|
|
3,426
|
|
|
—
|
|
|
2,719
|
|
|
65
|
|
|||||
Commercial
|
|
3,781
|
|
|
4,325
|
|
|
—
|
|
|
1,412
|
|
|
17
|
|
|||||
Home equity
|
|
285
|
|
|
688
|
|
|
—
|
|
|
369
|
|
|
—
|
|
|||||
Consumer
|
|
74
|
|
|
150
|
|
|
—
|
|
|
20
|
|
|
—
|
|
|||||
HPFC
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Ending balance
|
|
9,760
|
|
|
12,942
|
|
|
—
|
|
|
6,695
|
|
|
90
|
|
|||||
Total impaired loans
|
|
$
|
15,235
|
|
|
$
|
18,449
|
|
|
$
|
1,369
|
|
|
$
|
16,552
|
|
|
$
|
204
|
|
|
Banking
|
|
Financial Services
|
|
Total
|
||||||
Balance as of January 1, 2016:
|
|
|
|
|
|
|
|
|
|||
Goodwill
|
$
|
91,753
|
|
|
$
|
7,474
|
|
|
$
|
99,227
|
|
Accumulated impairment losses
|
—
|
|
|
(3,570
|
)
|
|
(3,570
|
)
|
|||
Reported goodwill
|
91,753
|
|
|
3,904
|
|
|
95,657
|
|
|||
Measurement-period adjustment (Note 2)
|
(960
|
)
|
|
—
|
|
|
(960
|
)
|
|||
Balance as of December 31, 2016:
|
|
|
|
|
|
||||||
Goodwill
|
90,793
|
|
|
7,474
|
|
|
98,267
|
|
|||
Accumulated impairment losses
|
—
|
|
|
(3,570
|
)
|
|
(3,570
|
)
|
|||
Reported goodwill
|
$
|
90,793
|
|
|
$
|
3,904
|
|
|
$
|
94,697
|
|
Balance as of January 1 and December 31, 2017:
|
|
|
|
|
|
||||||
Goodwill
|
$
|
90,793
|
|
|
$
|
7,474
|
|
|
$
|
98,267
|
|
Accumulated impairment losses
|
—
|
|
|
(3,570
|
)
|
|
(3,570
|
)
|
|||
Reported goodwill
|
$
|
90,793
|
|
|
$
|
3,904
|
|
|
$
|
94,697
|
|
|
|
December 31,
|
||||||||||||||||||||||
|
|
2017
|
|
2016
|
||||||||||||||||||||
|
|
Gross
Carrying
Amount
|
|
Accumulated Amortization
|
|
Net
Carrying
Amount
|
|
Gross
Carrying
Amount
|
|
Accumulated Amortization
|
|
Net
Carrying
Amount
|
||||||||||||
Core deposit intangible
|
|
$
|
23,908
|
|
|
$
|
(18,953
|
)
|
|
$
|
4,955
|
|
|
$
|
23,908
|
|
|
$
|
(17,220
|
)
|
|
$
|
6,688
|
|
Trust relationship intangible
|
|
753
|
|
|
(753
|
)
|
|
—
|
|
|
753
|
|
|
(677
|
)
|
|
76
|
|
||||||
Total
|
|
$
|
24,661
|
|
|
$
|
(19,706
|
)
|
|
$
|
4,955
|
|
|
$
|
24,661
|
|
|
$
|
(17,897
|
)
|
|
$
|
6,764
|
|
|
|
Core Deposit
Intangible
|
||
2018
|
|
$
|
725
|
|
2019
|
|
705
|
|
|
2020
|
|
682
|
|
|
2021
|
|
655
|
|
|
2022
|
|
625
|
|
|
Thereafter
|
|
1,563
|
|
|
Total
|
|
$
|
4,955
|
|
|
2017
|
|
2016
|
||||
Land and land improvements
|
$
|
2,985
|
|
|
$
|
3,012
|
|
Buildings and leasehold improvements
|
37,054
|
|
|
36,958
|
|
||
Furniture, fixtures and equipment
|
36,053
|
|
|
34,043
|
|
||
Total cost
|
76,092
|
|
|
74,013
|
|
||
Accumulated depreciation and amortization
|
(34,201
|
)
|
|
(31,140
|
)
|
||
Net premises and equipment
|
$
|
41,891
|
|
|
$
|
42,873
|
|
|
|
|
|
For The Year Ended
December 31,
|
||||||||||
Fixed Asset Type
|
|
Income Statement Line Item
|
|
2017
|
|
2016
|
|
2015
|
||||||
Equipment and data
|
|
Furniture, equipment and data processing
|
|
$
|
1,874
|
|
|
$
|
1,942
|
|
|
$
|
1,620
|
|
Premises
|
|
Net occupancy costs
|
|
1,643
|
|
|
1,757
|
|
|
1,140
|
|
|||
Software
|
|
Furniture, equipment and data processing
|
|
244
|
|
|
275
|
|
|
337
|
|
|||
Equipment, data and premises
|
|
Merger and acquisition costs
|
|
—
|
|
|
452
|
|
|
517
|
|
|||
Total
|
|
|
|
$
|
3,761
|
|
|
$
|
4,426
|
|
|
$
|
3,614
|
|
|
Operating
|
|
Capital
|
||||
2018
|
$
|
1,429
|
|
|
$
|
126
|
|
2019
|
1,394
|
|
|
126
|
|
||
2020
|
888
|
|
|
126
|
|
||
2021
|
671
|
|
|
130
|
|
||
2022
|
484
|
|
|
131
|
|
||
Thereafter
|
1,531
|
|
|
425
|
|
||
Total minimum lease payments
|
$
|
6,397
|
|
|
1,064
|
|
|
Less: amount representing interest
(1)
|
|
|
273
|
|
|||
Present value of net minimum lease payments
(2)
|
|
|
$
|
791
|
|
(1)
|
Amount necessary to reduce net minimum lease payments to present value calculated at the Company's incremental borrowing rate at lease inception.
|
(2)
|
Reflects the liability reported within short- and long-term borrowings on the consolidated statements of condition. At
December 31, 2017
and
2016
, the capital lease liability was
$791,000
and
$858,000
, respectively.
|
|
As of and For The Year Ended
December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Servicing Assets:
|
|
|
|
|
|
|
|
|
|||
Balance at beginning of year
|
$
|
1,210
|
|
|
$
|
2,161
|
|
|
$
|
493
|
|
Capitalized servicing right fees upon sale
(1)
|
22
|
|
|
9
|
|
|
294
|
|
|||
Acquired in connection with acquisition of SBM, at fair value
|
—
|
|
|
—
|
|
|
1,608
|
|
|||
Amortization charged against mortgage servicing fee income
(1)
|
(430
|
)
|
|
(734
|
)
|
|
(231
|
)
|
|||
Valuation adjustment
|
223
|
|
|
(226
|
)
|
|
(3
|
)
|
|||
Balance at end of year
|
$
|
1,025
|
|
|
$
|
1,210
|
|
|
$
|
2,161
|
|
Valuation Allowance:
|
|
|
|
|
|
|
|
|
|||
Balance at beginning of year
|
$
|
(230
|
)
|
|
$
|
(4
|
)
|
|
$
|
(1
|
)
|
(Increase) decrease in impairment reserve
(1)
|
223
|
|
|
(226
|
)
|
|
(3
|
)
|
|||
Balance at end of year
|
$
|
(7
|
)
|
|
$
|
(230
|
)
|
|
$
|
(4
|
)
|
Fair value, beginning of year
|
$
|
1,701
|
|
|
$
|
2,947
|
|
|
$
|
1,447
|
|
Fair value, end of year
|
$
|
1,766
|
|
|
$
|
1,701
|
|
|
$
|
2,947
|
|
(1)
|
Reported within mortgage banking income, net on the Company's consolidated statements of income.
|
|
Retail
|
|
Brokered
|
|
Total
|
||||||
2018
|
$
|
239,936
|
|
|
$
|
—
|
|
|
$
|
239,936
|
|
2019
|
110,867
|
|
|
—
|
|
|
110,867
|
|
|||
2020
|
62,944
|
|
|
7,000
|
|
|
69,944
|
|
|||
2021
|
32,208
|
|
|
—
|
|
|
32,208
|
|
|||
2022
|
19,816
|
|
|
—
|
|
|
19,816
|
|
|||
Thereafter
|
9,239
|
|
|
—
|
|
|
9,239
|
|
|||
Total
|
$
|
475,010
|
|
|
$
|
7,000
|
|
|
$
|
482,010
|
|
|
December 31,
2017
|
|
Contractual Maturity
|
|
December 31,
2016
|
||||||||||||||||||||||||||||||||
|
Outstanding Balance
|
|
Weighted
Average
Rate
|
|
2018
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
Thereafter
|
|
Outstanding Balance
|
|
Weighted
Average
Rate
|
||||||||||||||||||
Short-Term Borrowings:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
FHLBB borrowings
|
$
|
250,000
|
|
|
|
|
$
|
250,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
210,000
|
|
|
|
||
Customer repurchase agreements
|
244,646
|
|
|
|
|
244,646
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
225,605
|
|
|
|
||||||||||
FHLBB and correspondent bank overnight borrowings
|
47,150
|
|
|
|
|
47,150
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
89,450
|
|
|
|
||||||||||
Wholesale repurchase agreements
|
—
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,007
|
|
|
|
||||||||||
Capital lease obligation
|
71
|
|
|
|
|
71
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
67
|
|
|
|
||||||||||
Total short-term borrowings
|
$
|
541,867
|
|
|
1.10
|
%
|
|
$
|
541,867
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
530,129
|
|
|
0.74
|
%
|
Long-Term Borrowings:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
FHLBB borrowings
|
$
|
10,000
|
|
|
1.87
|
%
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
10,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
10,000
|
|
|
1.87
|
%
|
Capital lease obligation
|
720
|
|
|
4.18
|
%
|
|
—
|
|
|
76
|
|
|
81
|
|
|
90
|
|
|
98
|
|
|
375
|
|
|
791
|
|
|
4.31
|
%
|
||||||||
Total long-term borrowings
|
$
|
10,720
|
|
|
2.03
|
%
|
|
$
|
—
|
|
|
$
|
76
|
|
|
$
|
10,081
|
|
|
$
|
90
|
|
|
$
|
98
|
|
|
$
|
375
|
|
|
$
|
10,791
|
|
|
2.05
|
%
|
Subordinated Debentures:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Subordinated debentures
(1)
|
$
|
14,580
|
|
|
5.50
|
%
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
14,580
|
|
|
$
|
14,526
|
|
|
5.50
|
%
|
CCTA
|
36,083
|
|
|
5.48
|
%
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
36,083
|
|
|
36,083
|
|
|
5.50
|
%
|
||||||||
UBCT
|
8,248
|
|
|
6.75
|
%
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,248
|
|
|
8,146
|
|
|
6.85
|
%
|
||||||||
Total subordinated debentures
|
$
|
58,911
|
|
|
5.66
|
%
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
58,911
|
|
|
$
|
58,755
|
|
|
5.69
|
%
|
(1)
|
Presented net of debt issuance costs of
$420,000
and
$474,000
at December 31, 2017 and 2016, respectively.
|
•
|
The Company has an unsecured
$10.0 million
line of credit with PNC Bank that has a maturity date of
December 20, 2018
for which the interest rate is LIBOR-based and is set daily by PNC Bank.
|
•
|
The Company, through the Bank, has an unsecured
$50.0 million
line of credit with PNC Bank for which the interest rate is set daily by PNC Bank.
|
•
|
The Company, through the Bank, has a secured line of credit of
$99.8 million
through the FRB's Discount Window for which the interest rate is set by the FRB daily. At
December 31, 2017
, the Bank pledged commercial loans with a carrying value of
$144.4 million
and investment securities of
$31,000
.
|
Balance Sheet Classification
|
|
Outstanding Balance
|
|
Maturity Date
|
|
Interest Rate Range
|
|
Next Call Date
|
|
Call Amount
|
||||
Short-Term Borrowings
|
|
$
|
200,000
|
|
|
January 2018
|
|
1.45% - 1.63%
|
|
N/A
|
|
$
|
—
|
|
Short-Term Borrowings
|
|
$
|
50,000
|
|
|
February 2018
|
|
1.54%
|
|
N/A
|
|
$
|
—
|
|
Long-Term Borrowings
|
|
$
|
10,000
|
|
|
April 2020
|
|
1.87%
|
|
N/A
|
|
$
|
—
|
|
|
|
Remaining Contractual Maturity of the Agreements
|
||||||||||||||||||
|
|
Overnight and Continuous
|
|
Up to 30 Days
|
|
30 - 90 Days
|
|
Greater than 90 Days
|
|
Total
|
||||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Customer Repurchase Agreements:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Obligations of states and political subdivisions
|
|
$
|
630
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
630
|
|
Mortgage-backed securities issued or guaranteed by U.S. government-sponsored enterprises
|
|
98,460
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
98,460
|
|
|||||
Collateralized mortgage obligations issued or guaranteed by U.S. government-sponsored enterprises
|
|
145,556
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
145,556
|
|
|||||
Total Customer Repurchase Agreements
|
|
244,646
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
244,646
|
|
|||||
Total Repurchase Agreements
(1)
|
|
$
|
244,646
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
244,646
|
|
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Customer Repurchase Agreements:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Mortgage-backed securities issued or guaranteed by U.S. government-sponsored enterprises
|
|
$
|
117,784
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
117,784
|
|
Collateralized mortgage obligations issued or guaranteed by U.S. government-sponsored enterprises
|
|
107,821
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
107,821
|
|
|||||
Total Customer Repurchase Agreements
|
|
225,605
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
225,605
|
|
|||||
Wholesale Repurchase Agreements:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Mortgage-backed securities issued or guaranteed by U.S. government-sponsored enterprises
|
|
—
|
|
|
—
|
|
|
3,715
|
|
|
—
|
|
|
3,715
|
|
|||||
Collateralized mortgage obligations issued or guaranteed by U.S. government-sponsored enterprises
|
|
—
|
|
|
—
|
|
|
1,292
|
|
|
—
|
|
|
1,292
|
|
|||||
Total Wholesale Repurchase Agreements
|
|
—
|
|
|
—
|
|
|
5,007
|
|
|
—
|
|
|
5,007
|
|
|||||
Total Repurchase Agreements
(1)
|
|
$
|
225,605
|
|
|
$
|
—
|
|
|
$
|
5,007
|
|
|
$
|
—
|
|
|
$
|
230,612
|
|
(1)
|
Presented within short-term borrowings on the consolidated statements of condition.
|
|
For The Year Ended
December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Current:
|
|
|
|
|
|
|
|
|
|||
Federal
|
$
|
14,529
|
|
|
$
|
17,854
|
|
|
$
|
7,956
|
|
State
|
1,289
|
|
|
930
|
|
|
71
|
|
|||
|
15,818
|
|
|
18,784
|
|
|
8,027
|
|
|||
Deferred:
|
|
|
|
|
|
|
|
|
|||
Change in federal corporate income tax rate
(1)
|
14,263
|
|
|
—
|
|
|
—
|
|
|||
Federal
|
4,117
|
|
|
(1,258
|
)
|
|
1,356
|
|
|||
State
|
(320
|
)
|
|
(54
|
)
|
|
524
|
|
|||
|
18,060
|
|
|
(1,312
|
)
|
|
1,880
|
|
|||
Income tax expense
|
$
|
33,878
|
|
|
$
|
17,472
|
|
|
$
|
9,907
|
|
(1)
|
On December 22, 2017, the Tax Act was enacted, reducing the U.S. federal corporate income tax rate from 35.0% to 21.0%. ASC Topic 740,
Accounting for Income Taxes
(“ASC 740”), requires companies to recognize the effect of tax law changes in the period of enactment even though the effective date for most provisions of the Tax Act was January 1, 2018. As of December 31, 2017, the Company has completed its accounting for the tax effects of the Tax Act, which resulted in a reduction to net deferred tax assets and a corresponding charge to income tax expense of
$14.3
million.
|
|
For The Year Ended
December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Computed tax expense
|
$
|
21,824
|
|
|
$
|
20,139
|
|
|
$
|
10,801
|
|
Increase (reduction) in income taxes resulting from:
|
|
|
|
|
|
|
|||||
Change in federal corporate income tax rate
|
14,263
|
|
|
—
|
|
|
—
|
|
|||
Tax exempt income
|
(1,291
|
)
|
|
(1,312
|
)
|
|
(1,092
|
)
|
|||
Income from life insurance
|
(829
|
)
|
|
(908
|
)
|
|
(588
|
)
|
|||
State taxes, net of federal benefit
|
630
|
|
|
565
|
|
|
373
|
|
|||
Share-based awards
(1)
|
(390
|
)
|
|
(701
|
)
|
|
—
|
|
|||
Low income housing credits
|
(366
|
)
|
|
(376
|
)
|
|
(359
|
)
|
|||
Non-deductible acquisition-related costs
|
—
|
|
|
—
|
|
|
467
|
|
|||
Other
|
37
|
|
|
65
|
|
|
305
|
|
|||
Income tax expense
|
$
|
33,878
|
|
|
$
|
17,472
|
|
|
$
|
9,907
|
|
Income before income taxes
|
$
|
62,354
|
|
|
$
|
57,539
|
|
|
$
|
30,859
|
|
Effective tax rate
|
54.3
|
%
|
|
30.4
|
%
|
|
32.1
|
%
|
(1)
|
The Company adopted the provisions of ASU 2016-09,
Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting
, in calendar year 2016. Prior to adoption, it accounted for its windfall tax benefits or shortfalls generated upon exercise of a non-qualified stock option or a disqualifying incentive stock option, or upon vesting of its restricted shares through shareholders' equity (or as income tax expense to the extent the Company did not have a windfall tax benefit surplus). Upon adoption, the Company now accounts for its windfall tax benefits and shortfalls generated within income tax expense on the consolidated statements of income as a discrete period item in the quarter generated.
|
|
December 31,
|
||||||||||||||
|
2017
(1)
|
|
2016
(2)
|
||||||||||||
|
Asset
|
|
Liability
|
|
Asset
|
|
Liability
|
||||||||
Net operating loss and tax credit carryforward
|
$
|
12,078
|
|
|
$
|
—
|
|
|
$
|
20,977
|
|
|
$
|
—
|
|
Allowance for loan losses
|
5,201
|
|
|
—
|
|
|
8,094
|
|
|
—
|
|
||||
Pension and other benefits
|
3,363
|
|
|
—
|
|
|
5,141
|
|
|
—
|
|
||||
Net unrealized losses on AFS securities
|
2,821
|
|
|
—
|
|
|
3,227
|
|
|
—
|
|
||||
Net unrealized losses on derivative instruments
|
1,623
|
|
|
—
|
|
|
3,066
|
|
|
—
|
|
||||
Deferred compensation and benefits
|
1,199
|
|
|
—
|
|
|
1,791
|
|
|
—
|
|
||||
Net unrealized losses on postretirement plans
|
1,092
|
|
|
—
|
|
|
1,147
|
|
|
—
|
|
||||
Purchase accounting and deposit premium
|
461
|
|
|
—
|
|
|
1,430
|
|
|
—
|
|
||||
Depreciation
|
—
|
|
|
(2,857
|
)
|
|
—
|
|
|
(4,520
|
)
|
||||
Deferred loan origination fees
|
—
|
|
|
(1,510
|
)
|
|
—
|
|
|
(2,046
|
)
|
||||
Other
|
—
|
|
|
(695
|
)
|
|
956
|
|
|
—
|
|
||||
|
27,838
|
|
|
(5,062
|
)
|
|
45,829
|
|
|
(6,566
|
)
|
||||
Valuation allowance on deferred tax assets
|
|
|
—
|
|
|
|
|
—
|
|
||||||
Net deferred tax assets
|
|
|
$
|
22,776
|
|
|
|
|
$
|
39,263
|
|
(1)
|
At December 31, 2017, the Company's deferred tax assets and liabilities were calculated using a 21.5% deferred tax rate.
|
(2)
|
At December 31, 2016, the Company's deferred tax assets and liabilities were calculated using a 35.0% deferred tax rate.
|
|
|
December 31,
2017 |
|
Minimum Regulatory Capital Required for Capital Adequacy plus Capital Conservation Buffer
|
|
Minimum Regulatory Provision To Be "Well Capitalized" Under Prompt Corrective Action Provisions
|
|
December 31,
2016 |
|
Minimum Regulatory Capital Required For Capital Adequacy plus Capital Conservation Buffer
|
|
Minimum Regulatory Provision To Be "Well Capitalized" Under Prompt Corrective Action Provisions
|
||||||||||||||
|
|
Amount
|
|
Ratio
|
|
|
|
Amount
|
|
Ratio
|
|
|
||||||||||||||
Camden National Corporation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total risk-based capital ratio
|
|
$
|
396,451
|
|
|
14.14
|
%
|
|
9.25
|
%
|
|
N/A
|
|
|
$
|
368,856
|
|
|
14.04
|
%
|
|
8.63
|
%
|
|
N/A
|
|
Tier I risk-based capital ratio
|
|
357,261
|
|
|
12.74
|
%
|
|
7.25
|
%
|
|
N/A
|
|
|
330,729
|
|
|
12.59
|
%
|
|
6.63
|
%
|
|
N/A
|
|
||
Common equity Tier I risk-based capital ratio
|
|
316,677
|
|
|
11.30
|
%
|
|
5.75
|
%
|
|
N/A
|
|
|
296,120
|
|
|
11.27
|
%
|
|
5.13
|
%
|
|
N/A
|
|
||
Tier I leverage capital ratio
|
|
357,261
|
|
|
9.07
|
%
|
|
4.00
|
%
|
|
N/A
|
|
|
330,729
|
|
|
8.83
|
%
|
|
4.00
|
%
|
|
N/A
|
|
||
Camden National Bank:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total risk-based capital ratio
|
|
$
|
369,540
|
|
|
13.18
|
%
|
|
9.25
|
%
|
|
10.00
|
%
|
|
$
|
340,908
|
|
|
12.92
|
%
|
|
8.63
|
%
|
|
10.00
|
%
|
Tier I risk-based capital ratio
|
|
345,350
|
|
|
12.32
|
%
|
|
7.25
|
%
|
|
8.00
|
%
|
|
317,782
|
|
|
12.05
|
%
|
|
6.63
|
%
|
|
8.00
|
%
|
||
Common equity Tier I risk-based capital ratio
|
|
345,350
|
|
|
12.32
|
%
|
|
5.75
|
%
|
|
6.50
|
%
|
|
317,782
|
|
|
12.05
|
%
|
|
5.13
|
%
|
|
6.50
|
%
|
||
Tier I leverage capital ratio
|
|
345,350
|
|
|
8.80
|
%
|
|
4.00
|
%
|
|
5.00
|
%
|
|
317,782
|
|
|
8.54
|
%
|
|
4.00
|
%
|
|
5.00
|
%
|
|
For The Year Ended
December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Net income
|
$
|
28,476
|
|
|
$
|
40,067
|
|
|
$
|
20,952
|
|
Dividends and undistributed earnings allocated to participating securities
(1)
|
(118
|
)
|
|
(189
|
)
|
|
(59
|
)
|
|||
Net income available to common shareholders
|
$
|
28,358
|
|
|
$
|
39,878
|
|
|
$
|
20,893
|
|
Weighted-average common shares outstanding for basic EPS
|
15,509,665
|
|
|
15,422,160
|
|
|
12,031,294
|
|
|||
Dilutive effect of stock-based awards
(2)
|
78,682
|
|
|
82,079
|
|
|
43,285
|
|
|||
Weighted-average common and potential common shares for diluted EPS
|
15,588,347
|
|
|
15,504,239
|
|
|
12,074,579
|
|
|||
Earnings per common share:
|
|
|
|
|
|
|
|
|
|||
Basic EPS
|
$
|
1.83
|
|
|
$
|
2.59
|
|
|
$
|
1.73
|
|
Diluted EPS
|
$
|
1.82
|
|
|
$
|
2.57
|
|
|
$
|
1.73
|
|
Awards excluded from the calculation of diluted EPS
(3)
:
|
|
|
|
|
|
||||||
Stock options
|
—
|
|
|
—
|
|
|
19,875
|
|
(1)
|
Represents dividends paid and undistributed earnings allocated to nonvested stock-based awards that contain non-forfeitable rights to dividends.
|
(2)
|
Represents the effect of the assumed exercise of stock options, and vesting of restricted shares and restricted stock units, and issuance of LTIP awards that have met the performance criteria, utilizing the treasury stock method.
|
(3)
|
Represents stock-based awards not included in the computation of potential common shares for purposes of calculating diluted EPS as the exercise prices were greater than the average market price of the Company's common stock, and, therefore, are considered anti-dilutive.
|
•
|
Dividend yield is based on the dividend rate of the Company’s stock at the date of grant.
|
•
|
Risk-free interest rate is based on the U.S. Treasury bond rate with a term equaling the expected life of the granted options.
|
•
|
Expected volatility is based on the historical volatility of the Company’s stock price calculated over the expected life of the option.
|
•
|
Expected life represents the period of time that granted options are expected to be outstanding based on historical trends.
|
|
December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Weighted-average dividend yield
|
—
|
%
|
|
3.12
|
%
|
|
3.01
|
%
|
|||
Weighted-average risk-free interest rate
|
—
|
%
|
|
1.52
|
%
|
|
1.50
|
%
|
|||
Weighted-average expected volatility
|
—
|
%
|
|
29.64
|
%
|
|
31.85
|
%
|
|||
Weighted-average expected life (in years)
|
0.0
|
|
|
5.3
|
|
|
5.3
|
|
|||
Weighted-average fair value of options granted
|
$
|
—
|
|
|
$
|
5.17
|
|
|
$
|
5.87
|
|
|
|
Number of Options
|
|
Weighted-Average
Exercise Price per Option
|
|
Weighted-Average
Remaining
Contractual Term
(Years)
|
|
Aggregate Intrinsic Value
|
|||||
Options outstanding at January 1, 2017
|
|
58,743
|
|
|
$
|
20.38
|
|
|
|
|
|
||
Granted
|
|
—
|
|
|
—
|
|
|
|
|
|
|
||
Exercised
|
|
(11,841
|
)
|
|
17.50
|
|
|
|
|
|
|
||
Forfeited
|
|
(2,400
|
)
|
|
26.23
|
|
|
|
|
|
|||
Expired
|
|
(1,425
|
)
|
|
23.11
|
|
|
|
|
|
|||
Options outstanding at December 31, 2017
|
|
43,077
|
|
|
$
|
21.00
|
|
|
3.45
|
|
$
|
910
|
|
Options exercisable at December 31, 2017
|
|
39,627
|
|
|
$
|
20.58
|
|
|
3.11
|
|
$
|
854
|
|
|
Options
|
|
Weighted-Average
Grant Date
Fair Value per Option
|
|||
Nonvested at January 1, 2017
|
9,450
|
|
|
$
|
6.59
|
|
Granted
|
—
|
|
|
—
|
|
|
Vested
|
(3,600
|
)
|
|
7.80
|
|
|
Forfeited
|
(2,400
|
)
|
|
5.48
|
|
|
Nonvested at December 31, 2017
|
3,450
|
|
|
$
|
6.11
|
|
|
For The Year Ended
December 31, |
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Compensation expense
|
$
|
124
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Income tax benefit
|
27
|
|
|
—
|
|
|
—
|
|
|||
Fair value of grants vested
|
—
|
|
|
—
|
|
|
—
|
|
|
|
Number of Units
|
|
Weighted-Average
Grant Date
Fair Value per Unit
|
|
Weighted-Average
Remaining
Contractual Term
(Years)
|
|
Aggregate Intrinsic Value
|
|
Unrecognized
Compensation
|
|||||||
Nonvested at January 1, 2017
|
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|||
Granted
|
|
18,762
|
|
|
43.05
|
|
|
|
|
|
|
|
|
||||
Vested
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|||||
Forfeited
|
|
(1,285
|
)
|
|
43.11
|
|
|
|
|
|
|
|
|||||
Nonvested at December 31, 2017
|
|
17,477
|
|
|
$
|
43.04
|
|
|
4.6
|
|
$
|
736
|
|
|
$
|
620
|
|
|
For The Year Ended
December 31, |
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Compensation expense
|
$
|
762
|
|
|
$
|
703
|
|
|
$
|
327
|
|
Income tax benefit
|
164
|
|
|
246
|
|
|
114
|
|
|||
Fair value of grants vested
|
702
|
|
|
603
|
|
|
341
|
|
|
|
Number of Shares
|
|
Weighted-Average
Grant Date
Fair Value per Share
|
|
Weighted-Average
Remaining
Contractual Term
(Years)
|
|
Aggregate Intrinsic Value
|
|
Unrecognized
Compensation
|
|||||||
Nonvested at January 1, 2017
|
|
47,518
|
|
|
$
|
28.16
|
|
|
|
|
|
|
|
|
|||
Granted
|
|
16,185
|
|
|
42.39
|
|
|
|
|
|
|
|
|
||||
Vested
|
|
(22,553
|
)
|
|
31.14
|
|
|
|
|
|
|
|
|||||
Forfeited
|
|
(4,825
|
)
|
|
28.93
|
|
|
|
|
|
|
|
|||||
Nonvested at December 31, 2017
|
|
36,325
|
|
|
$
|
32.56
|
|
|
2.2
|
|
$
|
1,530
|
|
|
$
|
787
|
|
|
For The Year Ended
December 31, |
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Compensation expense
|
$
|
97
|
|
|
$
|
102
|
|
|
$
|
66
|
|
Income tax benefit
|
21
|
|
|
36
|
|
|
23
|
|
|||
Fair value of grants vested
|
91
|
|
|
57
|
|
|
92
|
|
|
|
Number of Shares
|
|
Weighted-Average
Grant Date
Fair Value per Share
|
|
Weighted-Average
Remaining
Contractual Term
(Years)
|
|
Aggregate Intrinsic Value
|
|
Unrecognized
Compensation
|
|||||||
Nonvested at January 1, 2017
|
|
26,699
|
|
|
$
|
7.85
|
|
|
|
|
|
|
|
|
|||
Granted
|
|
8,088
|
|
|
13.73
|
|
|
|
|
|
|
|
|
||||
Vested
|
|
(11,777
|
)
|
|
7.73
|
|
|
|
|
|
|
|
|||||
Forfeited
|
|
(2,791
|
)
|
|
11.49
|
|
|
|
|
|
|
|
|||||
Nonvested at December 31, 2017
|
|
20,219
|
|
|
$
|
9.77
|
|
|
1.0
|
|
$
|
431
|
|
|
$
|
54
|
|
|
For The Year Ended
December 31, |
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Compensation expense
(1)
|
$
|
370
|
|
|
$
|
1,080
|
|
|
$
|
330
|
|
Related income tax benefit
|
80
|
|
|
378
|
|
|
116
|
|
|||
Fair value of grants vested
|
843
|
|
|
725
|
|
|
412
|
|
|
|
Number of Shares
|
|
Weighted-Average
Grant Date
Fair Value per Share
|
|
Weighted-Average
Remaining
Contractual Term
(Years)
|
|
Aggregate Intrinsic Value
|
|
Unrecognized
Compensation
|
|||||||
Nonvested at January 1, 2017
|
|
52,737
|
|
|
$
|
27.01
|
|
|
|
|
|
|
|
|
|||
Granted
|
|
16,830
|
|
|
41.39
|
|
|
|
|
|
|
|
|
||||
Vested
|
|
(32,323
|
)
|
|
26.09
|
|
|
|
|
|
|
|
|||||
Forfeited
|
|
(5,621
|
)
|
|
26.97
|
|
|
|
|
|
|
|
|||||
Nonvested at December 31, 2017
|
|
31,623
|
|
|
$
|
35.60
|
|
|
1.7
|
|
$
|
1,332
|
|
|
$
|
291
|
|
|
For The Year Ended
December 31, |
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Compensation expense
|
$
|
97
|
|
|
$
|
81
|
|
|
$
|
62
|
|
Related income tax benefit
|
21
|
|
|
28
|
|
|
22
|
|
|||
Fair value of grants vested
|
90
|
|
|
75
|
|
|
59
|
|
|
|
Number of Deferred Stock Awards
|
|
Weighted-Average
Grant Date
Fair Value per Award
|
|
Weighted-Average
Remaining
Contractual Term
(Years)
|
|
Aggregate Intrinsic Value
|
|
Unrecognized
Compensation
|
|||||||
Nonvested at January 1, 2017
|
|
14,244
|
|
|
$
|
23.65
|
|
|
|
|
|
|
|
|
|||
Granted
|
|
2,772
|
|
|
42.66
|
|
|
|
|
|
|
|
|
||||
Vested
|
|
(2,776
|
)
|
|
32.50
|
|
|
|
|
|
|
|
|||||
Forfeited
|
|
(4,192
|
)
|
|
25.88
|
|
|
|
|
|
|
|
|||||
Nonvested at December 31, 2017
|
|
10,048
|
|
|
$
|
25.52
|
|
|
9.2
|
|
$
|
423
|
|
|
$
|
229
|
|
|
SERP
|
|
Other Postretirement
Benefits
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Benefit obligations:
|
|
|
|
|
|
|
|
|
|
|
|||||
Beginning of year
|
$
|
11,523
|
|
|
$
|
11,052
|
|
|
$
|
3,635
|
|
|
$
|
3,447
|
|
Service cost
|
335
|
|
|
308
|
|
|
53
|
|
|
59
|
|
||||
Interest cost
|
452
|
|
|
432
|
|
|
144
|
|
|
151
|
|
||||
Actuarial loss
|
1,955
|
|
|
219
|
|
|
110
|
|
|
143
|
|
||||
Benefits paid
|
(475
|
)
|
|
(488
|
)
|
|
(151
|
)
|
|
(165
|
)
|
||||
End of year
|
13,790
|
|
|
11,523
|
|
|
3,791
|
|
|
3,635
|
|
||||
Fair value of plan assets:
|
|
|
|
|
|
|
|
||||||||
Beginning of year
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Employer contributions
|
475
|
|
|
488
|
|
|
151
|
|
|
165
|
|
||||
Benefits paid
|
(475
|
)
|
|
(488
|
)
|
|
(151
|
)
|
|
(165
|
)
|
||||
End of year
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Unfunded status at end of year
(1)
|
$
|
13,790
|
|
|
$
|
11,523
|
|
|
$
|
3,791
|
|
|
$
|
3,635
|
|
Amounts recognized in AOCI, net of tax:
|
|
|
|
|
|
|
|
||||||||
Net actuarial loss
|
$
|
3,504
|
|
|
$
|
1,791
|
|
|
$
|
654
|
|
|
$
|
495
|
|
Prior service credit
|
—
|
|
|
—
|
|
|
(170
|
)
|
|
(156
|
)
|
||||
Total
|
$
|
3,504
|
|
|
$
|
1,791
|
|
|
$
|
484
|
|
|
$
|
339
|
|
(1)
|
Presented within other liabilities on the consolidated statements of condition.
|
|
SERP
|
|
Other Postretirement
Benefits
|
||||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|
2017
|
|
2016
|
|
2015
|
||||||||||||
Net periodic benefit cost:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Service cost
|
$
|
335
|
|
|
$
|
308
|
|
|
$
|
307
|
|
|
$
|
53
|
|
|
$
|
59
|
|
|
$
|
62
|
|
Interest cost
|
452
|
|
|
432
|
|
|
424
|
|
|
144
|
|
|
151
|
|
|
117
|
|
||||||
Recognized net actuarial loss
|
246
|
|
|
220
|
|
|
218
|
|
|
41
|
|
|
30
|
|
|
24
|
|
||||||
Amortization of prior service cost (credit)
|
—
|
|
|
7
|
|
|
19
|
|
|
(24
|
)
|
|
(22
|
)
|
|
(22
|
)
|
||||||
Net periodic benefit cost
|
1,033
|
|
|
967
|
|
|
968
|
|
|
214
|
|
|
218
|
|
|
181
|
|
||||||
Changes in funded status recognized in OCI, before taxes:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Net actuarial (gain) loss arising during period
|
1,955
|
|
|
219
|
|
|
(32
|
)
|
|
110
|
|
|
143
|
|
|
92
|
|
||||||
Reclassifications to net period benefit cost:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Amortization of net unrecognized actuarial loss
|
(246
|
)
|
|
(220
|
)
|
|
(218
|
)
|
|
(41
|
)
|
|
(30
|
)
|
|
(24
|
)
|
||||||
Amortization of prior service (cost) credit
|
—
|
|
|
(7
|
)
|
|
(19
|
)
|
|
24
|
|
|
22
|
|
|
22
|
|
||||||
Total recognized in OCI, before taxes
|
1,709
|
|
|
(8
|
)
|
|
(269
|
)
|
|
93
|
|
|
135
|
|
|
90
|
|
||||||
Total recognized in net periodic benefit cost and OCI, before taxes
|
$
|
2,742
|
|
|
$
|
959
|
|
|
$
|
699
|
|
|
$
|
307
|
|
|
$
|
353
|
|
|
$
|
271
|
|
|
SERP
|
|
Other Postretirement
Benefits
|
||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|
2017
|
|
2016
|
|
2015
|
||||||
Weighted-average assumptions as of end of year:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discount rate for benefit obligation
|
3.60
|
%
|
|
4.00
|
%
|
|
4.00
|
%
|
|
3.55
|
%
|
|
4.00
|
%
|
|
4.50
|
%
|
Discount rate for net periodic benefit cost
|
4.00
|
%
|
|
4.00
|
%
|
|
4.00
|
%
|
|
4.00
|
%
|
|
4.50
|
%
|
|
4.00
|
%
|
Rate of compensation increase for benefit obligation
|
5.00
|
%
|
|
4.00
|
%
|
|
4.00
|
%
|
|
—
|
|
|
—
|
|
|
—
|
|
Rate of compensation increase for net periodic benefit cost
|
5.00
|
%
|
|
4.00
|
%
|
|
4.00
|
%
|
|
—
|
|
|
—
|
|
|
—
|
|
Health care cost trend rate assumed for future years
|
—
|
|
|
—
|
|
|
—
|
|
|
6.50
|
%
|
|
7.00
|
%
|
|
7.00
|
%
|
|
|
For The Year Ended
December 31,
|
||||||||||
Other income
|
|
2017
|
|
2016
|
|
2015
|
||||||
Customer loan swap fee income
(1)
|
|
$
|
1,574
|
|
|
$
|
2,104
|
|
|
$
|
1,514
|
|
Other income
|
|
1,545
|
|
|
4,830
|
|
|
2,363
|
|
|||
Total
|
|
$
|
3,119
|
|
|
$
|
6,934
|
|
|
$
|
3,877
|
|
(1)
|
Fee income recognized upon completion of customer loan swaps. Refer to Note 18 for further discussion.
|
|
|
For The Year Ended
December 31,
|
||||||||||
Other expenses
|
|
2017
|
|
2016
|
|
2015
|
||||||
Donations and marketing
|
|
$
|
1,852
|
|
|
$
|
1,660
|
|
|
$
|
1,841
|
|
Employee-related costs
(1)
|
|
1,710
|
|
|
1,616
|
|
|
1,437
|
|
|||
Postage, freight, and courier
|
|
1,655
|
|
|
1,754
|
|
|
1,430
|
|
|||
Other expenses
|
|
5,731
|
|
|
5,657
|
|
|
4,502
|
|
|||
Total
|
|
$
|
10,948
|
|
|
$
|
10,687
|
|
|
$
|
9,210
|
|
(1)
|
Employee-related costs include hiring, training, education, meeting and business travel costs.
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
Lending-Related Instruments:
|
|
|
|
|
|
||
Loan origination commitments and unadvanced lines of credit:
|
|
|
|
|
|
||
Home equity
|
$
|
477,401
|
|
|
$
|
454,225
|
|
Commercial and commercial real estate
|
49,482
|
|
|
83,103
|
|
||
Residential
|
41,368
|
|
|
17,795
|
|
||
Letters of credit
|
2,848
|
|
|
2,580
|
|
||
Other commitments
|
523
|
|
|
432
|
|
||
Derivative Financial Instruments:
|
|
|
|
||||
Customer loan swaps
|
$
|
703,336
|
|
|
$
|
532,526
|
|
FHLBB advance interest rate swaps
|
50,000
|
|
|
50,000
|
|
||
Junior subordinated debt interest rate swaps
|
43,000
|
|
|
43,000
|
|
||
Fixed-rate mortgage interest rate lock commitments
|
21,746
|
|
|
15,249
|
|
||
Forward delivery commitments
|
8,065
|
|
|
15,125
|
|
|
|
|
|
December 31,
|
||||||||||||||||||||
|
|
|
|
2017
|
|
2016
|
||||||||||||||||||
|
|
Balance Sheet Location
|
|
Number of Positions
|
|
Notional
|
|
Fair Value
|
|
Number of Positions
|
|
Notional
|
|
Fair Value
|
||||||||||
Receive fixed, pay variable
|
|
Other assets / (accrued interest and other liabilities)
|
|
42
|
|
|
$
|
226,884
|
|
|
$
|
(5,036
|
)
|
|
50
|
|
|
$
|
266,263
|
|
|
$
|
(1,945
|
)
|
Receive fixed, pay variable
|
|
Other assets / (accrued interest and other liabilities)
|
|
23
|
|
|
124,784
|
|
|
1,799
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Pay fixed, receive variable
|
|
Other assets / (accrued interest and other liabilities)
|
|
65
|
|
|
351,668
|
|
|
3,237
|
|
|
50
|
|
|
266,263
|
|
|
1,945
|
|
||||
Total
|
|
|
|
130
|
|
|
$
|
703,336
|
|
|
$
|
—
|
|
|
100
|
|
|
$
|
532,526
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
|
||||||||
|
|
|
|
|
|
|
|
|
|
2017
|
|
2016
|
||||||
Notional
Amount |
|
Trade
Date |
|
Maturity Date
|
|
Variable Index
Received |
|
Fixed Rate
Paid |
|
Fair Value
(1)
|
|
Fair Value
(2)
|
||||||
$
|
25,000
|
|
|
2/25/2015
|
|
2/25/2018
|
|
1-Month USD LIBOR
|
|
1.54%
|
|
$
|
20
|
|
|
$
|
(152
|
)
|
25,000
|
|
|
2/25/2015
|
|
2/25/2019
|
|
1-Month USD LIBOR
|
|
1.74%
|
|
1
|
|
|
(237
|
)
|
|||
$
|
50,000
|
|
|
|
|
|
|
|
|
|
|
$
|
21
|
|
|
$
|
(389
|
)
|
(1)
|
Presented within other assets on the consolidated statements of condition.
|
(2)
|
Presented within accrued interest and other liabilities on the consolidated statements of condition.
|
|
|
|
|
|
|
|
|
|
|
December 31,
|
||||||||
|
|
|
|
|
|
|
|
|
|
2017
|
|
2016
|
||||||
Notional
Amount
|
|
Trade
Date
|
|
Maturity Date
|
|
Variable Index
Received
|
|
Fixed Rate
Paid
|
|
Fair Value
(1)
|
|
Fair Value
(1)
|
||||||
$
|
10,000
|
|
|
3/18/2009
|
|
6/30/2021
|
|
3-Month USD LIBOR
|
|
5.09%
|
|
$
|
(527
|
)
|
|
$
|
(806
|
)
|
10,000
|
|
|
7/8/2009
|
|
6/30/2029
|
|
3-Month USD LIBOR
|
|
5.84%
|
|
(2,133
|
)
|
|
(2,321
|
)
|
|||
10,000
|
|
|
5/6/2010
|
|
6/30/2030
|
|
3-Month USD LIBOR
|
|
5.71%
|
|
(2,129
|
)
|
|
(2,290
|
)
|
|||
5,000
|
|
|
3/14/2011
|
|
3/30/2031
|
|
3-Month USD LIBOR
|
|
4.35%
|
|
(1,137
|
)
|
|
(1,211
|
)
|
|||
8,000
|
|
|
5/4/2011
|
|
7/7/2031
|
|
3-Month USD LIBOR
|
|
4.14%
|
|
(1,645
|
)
|
|
(1,744
|
)
|
|||
$
|
43,000
|
|
|
|
|
|
|
|
|
|
|
$
|
(7,571
|
)
|
|
$
|
(8,372
|
)
|
|
|
|
|
December 31,
|
||||||||||||||
|
|
|
|
2017
|
|
2016
|
||||||||||||
|
|
Balance Sheet Location
|
|
Notional
|
|
Fair
Value
|
|
Notional
|
|
Fair
Value
|
||||||||
Fixed-rate mortgage interest rate locks
|
|
Other assets
|
|
$
|
19,886
|
|
|
$
|
307
|
|
|
$
|
12,310
|
|
|
$
|
202
|
|
Fixed-rate mortgage interest rate locks
|
|
Accrued interest and other liabilities
|
|
1,860
|
|
|
(22
|
)
|
|
2,939
|
|
|
(15
|
)
|
||||
Total
|
|
|
|
$
|
21,746
|
|
|
$
|
285
|
|
|
$
|
15,249
|
|
|
$
|
187
|
|
|
|
|
|
December 31,
|
||||||||||||||
|
|
|
|
2017
|
|
2016
|
||||||||||||
|
|
Balance Sheet Location
|
|
Notional
|
|
Fair
Value
|
|
Notional
|
|
Fair
Value
|
||||||||
Forward delivery commitments ("best-effort")
|
|
Other assets
|
|
$
|
6,692
|
|
|
$
|
158
|
|
|
$
|
14,250
|
|
|
$
|
587
|
|
Forward delivery commitments ("best-effort")
|
|
Accrued interest and other liabilities
|
|
1,373
|
|
|
(16
|
)
|
|
875
|
|
|
(309
|
)
|
||||
Total
|
|
|
|
$
|
8,065
|
|
|
$
|
142
|
|
|
$
|
15,125
|
|
|
$
|
278
|
|
|
|
For The Year Ended
December 31, |
||||||||||
|
|
2017
|
|
2016
|
|
2015
|
||||||
Derivatives designated as cash flow hedges
|
|
|
|
|
|
|
||||||
Effective portion of unrealized losses recognized within AOCI during the period, net of tax
|
|
$
|
(248
|
)
|
|
$
|
(637
|
)
|
|
$
|
(1,533
|
)
|
Net reclassification adjustment for effective portion of cash flow hedges included in interest expense, gross
(1)
|
|
$
|
1,592
|
|
|
$
|
2,026
|
|
|
$
|
1,695
|
|
(1)
|
Reclassified into the consolidated statements of income within interest expense.
|
Level 1:
|
Valuation is based upon unadjusted quoted prices in active markets for identical assets and liabilities that the entity has the ability to access as of the measurement date.
|
Level 2:
|
Valuation is determined from quoted prices for similar assets or liabilities in active markets, from quoted prices for identical or similar instruments in markets that are not active or by model-based techniques in which all significant inputs are observable in the market.
|
Level 3:
|
Valuation is derived from model-based and other techniques in which at least one significant input is unobservable and which may be based on the Company’s own estimates about the assumptions that market participants would use to value the asset or liability.
|
|
Fair Value
|
|
Readily Available Market Prices
(Level 1)
|
|
Observable Market Data
(Level 2)
|
|
Company Determined Fair Value
(Level 3)
|
||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
|||||
Loans held for sale
|
$
|
8,103
|
|
|
$
|
—
|
|
|
$
|
8,103
|
|
|
$
|
—
|
|
AFS securities:
|
|
|
|
|
|
|
|
|
|
||||||
Obligations of states and political subdivisions
|
7,335
|
|
|
—
|
|
|
7,335
|
|
|
—
|
|
||||
Mortgage-backed securities issued or guaranteed by U.S. government-sponsored enterprises
|
503,302
|
|
|
—
|
|
|
503,302
|
|
|
—
|
|
||||
Collateralized mortgage obligations issued or guaranteed by U.S. government-sponsored enterprises
|
272,799
|
|
|
—
|
|
|
272,799
|
|
|
—
|
|
||||
Subordinated corporate bonds
|
5,657
|
|
|
—
|
|
|
5,657
|
|
|
—
|
|
||||
Equity securities
|
806
|
|
|
—
|
|
|
806
|
|
|
—
|
|
||||
Customer loan swaps
|
5,036
|
|
|
—
|
|
|
5,036
|
|
|
—
|
|
||||
Fixed-rate mortgage interest rate lock commitments
|
307
|
|
|
—
|
|
|
307
|
|
|
—
|
|
||||
Forward delivery commitments
|
158
|
|
|
—
|
|
|
158
|
|
|
—
|
|
||||
FHLBB advance interest rate swaps
|
21
|
|
|
—
|
|
|
21
|
|
|
—
|
|
||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
||||||
Junior subordinated debt interest rate swaps
|
7,571
|
|
|
—
|
|
|
7,571
|
|
|
—
|
|
||||
Customer loan swaps
|
5,036
|
|
|
—
|
|
|
5,036
|
|
|
—
|
|
||||
Fixed-rate mortgage interest rate lock commitments
|
22
|
|
|
—
|
|
|
22
|
|
|
—
|
|
||||
Forward delivery commitments
|
16
|
|
|
—
|
|
|
16
|
|
|
—
|
|
||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
|||||
Loans held for sale
|
$
|
14,836
|
|
|
$
|
—
|
|
|
$
|
14,836
|
|
|
$
|
—
|
|
AFS securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Obligations of states and political subdivisions
|
9,001
|
|
|
—
|
|
|
9,001
|
|
|
—
|
|
||||
Mortgage-backed securities issued or guaranteed by U.S. government-sponsored enterprises
|
480,622
|
|
|
—
|
|
|
480,622
|
|
|
—
|
|
||||
Collateralized mortgage obligations issued or guaranteed by U.S. government-sponsored enterprises
|
283,890
|
|
|
—
|
|
|
283,890
|
|
|
—
|
|
||||
Subordinated corporate bonds
|
5,613
|
|
|
—
|
|
|
5,613
|
|
|
—
|
|
||||
Equity securities
|
741
|
|
|
—
|
|
|
741
|
|
|
—
|
|
||||
Customer loan swaps
|
1,945
|
|
|
—
|
|
|
1,945
|
|
|
—
|
|
||||
Fixed-rate mortgage interest rate lock commitments
|
202
|
|
|
—
|
|
|
202
|
|
|
—
|
|
||||
Forward delivery commitments
|
587
|
|
|
—
|
|
|
587
|
|
|
—
|
|
||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Junior subordinated debt interest rate swaps
|
8,372
|
|
|
—
|
|
|
8,372
|
|
|
—
|
|
||||
FHLBB advance interest rate swaps
|
389
|
|
|
—
|
|
|
389
|
|
|
—
|
|
||||
Customer loan swaps
|
1,945
|
|
|
—
|
|
|
1,945
|
|
|
—
|
|
||||
Fixed-rate mortgage interest rate lock commitments
|
15
|
|
|
—
|
|
|
15
|
|
|
—
|
|
||||
Forward delivery commitments
|
309
|
|
|
—
|
|
|
309
|
|
|
—
|
|
|
Fair Value
|
|
Readily Available Market Prices
(Level 1)
|
|
Observable Market Data
(Level 2)
|
|
Company Determined
Fair Value
(Level 3)
|
||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
|||||
Collateral-dependent impaired loans
|
$
|
3,696
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,696
|
|
Servicing assets
(1)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Non-financial assets:
|
|
|
|
|
|
|
|
||||||||
OREO
|
130
|
|
|
—
|
|
|
—
|
|
|
130
|
|
||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
|||||
Collateral-dependent impaired loans
|
$
|
500
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
500
|
|
Servicing assets
(1)
|
1,090
|
|
|
—
|
|
|
—
|
|
|
1,090
|
|
||||
Non-financial assets:
|
|
|
|
|
|
|
|
||||||||
OREO
|
922
|
|
|
—
|
|
|
—
|
|
|
922
|
|
(1)
|
Represents mortgage serving assets deemed to be impaired and a valuation allowance was established to carry at fair value at
December 31, 2017
and
2016
.
|
|
Fair Value
|
|
Valuation Methodology
|
|
Unobservable input
|
|
Discount Range (Weighted-Average)
|
|||
December 31, 2017
|
|
|
|
|
|
|
|
|
||
Collateral-dependent impaired loans:
|
|
|
|
|
|
|
|
|
|
|
Partially charged-off
|
$
|
86
|
|
|
Market approach appraisal of collateral
|
|
Management adjustment
of appraisal
|
|
0 - 50%
|
(18%)
|
|
|
|
|
|
Estimated selling costs
|
|
0 - 10%
|
(6%)
|
||
Specifically reserved
|
3,610
|
|
|
Market approach appraisal of collateral
|
|
Management adjustment
of appraisal
|
|
0%
|
(0%)
|
|
|
|
|
|
|
Estimated selling costs
|
|
10%
|
(10%)
|
||
OREO
|
130
|
|
|
Market approach appraisal of collateral
|
|
Management adjustment
of appraisal
|
|
20%
|
(20%)
|
|
|
|
|
|
|
Estimated selling costs
|
|
10%
|
(10%)
|
||
December 31, 2016
|
|
|
|
|
|
|
|
|
||
Collateral-dependent impaired loans:
|
|
|
|
|
|
|
|
|
|
|
Partially charged-off
|
$
|
166
|
|
|
Market approach appraisal of collateral
|
|
Management adjustment
of appraisal
|
|
0%
|
(0%)
|
|
|
|
|
|
|
Estimated selling costs
|
|
0 - 10%
|
(5%)
|
|
Specifically reserved
|
334
|
|
|
Market approach appraisal of collateral
|
|
Management adjustment
of appraisal
|
|
0 - 50%
|
(13%)
|
|
|
|
|
|
|
Estimated selling costs
|
|
10%
|
(10%)
|
||
OREO
|
922
|
|
|
Market approach appraisal of collateral
|
|
Management adjustment
of appraisal
|
|
0 - 73%
|
(7%)
|
|
|
|
|
|
|
Estimated selling costs
|
|
10%
|
(10%)
|
|
Carrying Amount
|
|
Fair Value
|
|
Readily Available Market Prices
(Level 1)
|
|
Observable Market Prices
(Level 2)
|
|
Company Determined Market Prices
(Level 3)
|
||||||||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Cash and due from banks
|
$
|
102,971
|
|
|
$
|
102,971
|
|
|
$
|
102,971
|
|
|
$
|
—
|
|
|
$
|
—
|
|
AFS securities
|
789,899
|
|
|
789,899
|
|
|
—
|
|
|
789,899
|
|
|
—
|
|
|||||
HTM securities
|
94,073
|
|
|
94,913
|
|
|
—
|
|
|
94,913
|
|
|
—
|
|
|||||
Loans held for sale
|
8,103
|
|
|
8,103
|
|
|
—
|
|
|
8,103
|
|
|
—
|
|
|||||
Residential real estate loans
(1)
|
853,283
|
|
|
853,056
|
|
|
—
|
|
|
—
|
|
|
853,056
|
|
|||||
Commercial real estate loans
(1)
|
1,152,160
|
|
|
1,115,618
|
|
|
—
|
|
|
—
|
|
|
1,115,618
|
|
|||||
Commercial loans
(1)(2)
|
413,898
|
|
|
401,902
|
|
|
—
|
|
|
—
|
|
|
401,902
|
|
|||||
Home equity loans
(1)
|
321,011
|
|
|
318,230
|
|
|
—
|
|
|
—
|
|
|
318,230
|
|
|||||
Consumer loans
(1)
|
17,916
|
|
|
17,335
|
|
|
—
|
|
|
—
|
|
|
17,335
|
|
|||||
Servicing assets
|
1,025
|
|
|
1,766
|
|
|
—
|
|
|
1,766
|
|
|
—
|
|
|||||
Interest receivable
|
9,595
|
|
|
9,595
|
|
|
—
|
|
|
9,595
|
|
|
—
|
|
|||||
Customer loan swaps
|
5,036
|
|
|
5,036
|
|
|
—
|
|
|
5,036
|
|
|
—
|
|
|||||
Fixed-rate mortgage interest rate lock commitments
|
307
|
|
|
307
|
|
|
—
|
|
|
307
|
|
|
—
|
|
|||||
Forward delivery commitments
|
158
|
|
|
158
|
|
|
—
|
|
|
158
|
|
|
—
|
|
|||||
FHLBB advance interest rate swaps
|
21
|
|
|
21
|
|
|
—
|
|
|
21
|
|
|
—
|
|
|||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Deposits
|
$
|
3,000,491
|
|
|
$
|
2,995,269
|
|
|
$
|
—
|
|
|
$
|
2,995,269
|
|
|
$
|
—
|
|
Short-term borrowings
|
541,867
|
|
|
541,683
|
|
|
—
|
|
|
541,683
|
|
|
—
|
|
|||||
Long-term borrowings
|
10,720
|
|
|
10,699
|
|
|
—
|
|
|
10,699
|
|
|
—
|
|
|||||
Subordinated debentures
|
58,911
|
|
|
44,333
|
|
|
—
|
|
|
44,333
|
|
|
—
|
|
|||||
Interest payable
|
564
|
|
|
564
|
|
|
—
|
|
|
564
|
|
|
—
|
|
|||||
Junior subordinated debt interest rate swaps
|
7,571
|
|
|
7,571
|
|
|
—
|
|
|
7,571
|
|
|
—
|
|
|||||
Customer loan swaps
|
5,036
|
|
|
5,036
|
|
|
—
|
|
|
5,036
|
|
|
—
|
|
|||||
Fixed-rate mortgage interest rate lock commitments
|
22
|
|
|
22
|
|
|
—
|
|
|
22
|
|
|
—
|
|
|||||
Forward delivery commitments
|
16
|
|
|
16
|
|
|
—
|
|
|
16
|
|
|
—
|
|
(1)
|
The presented carrying amount is net of the allocated ALL.
|
(2)
|
Includes the HPFC loan portfolio.
|
|
Carrying Amount
|
|
Fair Value
|
|
Readily Available Market Prices
(Level 1)
|
|
Observable Market Prices
(Level 2)
|
|
Company Determined Market Prices
(Level 3)
|
||||||||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Cash and due from banks
|
$
|
87,707
|
|
|
$
|
87,707
|
|
|
$
|
87,707
|
|
|
$
|
—
|
|
|
$
|
—
|
|
AFS securities
|
779,867
|
|
|
779,867
|
|
|
—
|
|
|
779,867
|
|
|
—
|
|
|||||
HTM securities
|
94,609
|
|
|
94,596
|
|
|
—
|
|
|
94,596
|
|
|
—
|
|
|||||
Loans held for sale
|
14,836
|
|
|
14,836
|
|
|
—
|
|
|
14,836
|
|
|
—
|
|
|||||
Residential real estate loans
(1)
|
798,334
|
|
|
800,122
|
|
|
—
|
|
|
—
|
|
|
800,122
|
|
|||||
Commercial real estate loans
(1)
|
1,038,626
|
|
|
1,006,249
|
|
|
—
|
|
|
—
|
|
|
1,006,249
|
|
|||||
Commercial loans
(1)(2)
|
389,624
|
|
|
391,493
|
|
|
—
|
|
|
—
|
|
|
391,493
|
|
|||||
Home equity loans
(1)
|
327,713
|
|
|
327,292
|
|
|
—
|
|
|
—
|
|
|
327,292
|
|
|||||
Consumer loans
(1)
|
17,151
|
|
|
16,845
|
|
|
—
|
|
|
—
|
|
|
16,845
|
|
|||||
Servicing assets
|
1,210
|
|
|
1,701
|
|
|
—
|
|
|
1,701
|
|
|
—
|
|
|||||
Interest receivable
|
8,654
|
|
|
8,654
|
|
|
—
|
|
|
8,654
|
|
|
—
|
|
|||||
Customer loan swaps
|
1,945
|
|
|
1,945
|
|
|
—
|
|
|
1,945
|
|
|
—
|
|
|||||
Fixed-rate mortgage interest rate lock commitments
|
202
|
|
|
202
|
|
|
—
|
|
|
202
|
|
|
—
|
|
|||||
Forward delivery commitments
|
587
|
|
|
587
|
|
|
—
|
|
|
587
|
|
|
—
|
|
|||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Deposits
|
$
|
2,828,529
|
|
|
$
|
2,826,484
|
|
|
$
|
—
|
|
|
$
|
2,826,484
|
|
|
$
|
—
|
|
Short-term borrowings
|
530,129
|
|
|
530,435
|
|
|
—
|
|
|
530,435
|
|
|
—
|
|
|||||
Long-term borrowings
|
10,791
|
|
|
10,836
|
|
|
—
|
|
|
10,836
|
|
|
—
|
|
|||||
Subordinated debentures
|
58,755
|
|
|
41,660
|
|
|
—
|
|
|
41,660
|
|
|
—
|
|
|||||
Interest payable
|
534
|
|
|
534
|
|
|
—
|
|
|
534
|
|
|
—
|
|
|||||
Junior subordinated debt interest rate swaps
|
8,372
|
|
|
8,372
|
|
|
—
|
|
|
8,372
|
|
|
—
|
|
|||||
FHLBB advance interest rate swaps
|
389
|
|
|
389
|
|
|
—
|
|
|
389
|
|
|
—
|
|
|||||
Customer loan swaps
|
1,945
|
|
|
1,945
|
|
|
—
|
|
|
1,945
|
|
|
—
|
|
|||||
Fixed-rate mortgage interest rate lock commitments
|
15
|
|
|
15
|
|
|
—
|
|
|
15
|
|
|
—
|
|
|||||
Forward delivery commitments
|
309
|
|
|
309
|
|
|
—
|
|
|
309
|
|
|
—
|
|
(1)
|
The presented carrying amount is net of the allocated ALL.
|
(2)
|
Includes the HPFC loan portfolio.
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
ASSETS
|
|
|
|
|
|
||
Cash
|
$
|
29,365
|
|
|
$
|
29,905
|
|
Investment in subsidiary
|
444,235
|
|
|
429,100
|
|
||
Receivable from subsidiary
|
107
|
|
|
107
|
|
||
Other assets
|
14,806
|
|
|
12,420
|
|
||
Total assets
|
$
|
488,513
|
|
|
$
|
471,532
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
||
Subordinated debentures
|
$
|
58,911
|
|
|
$
|
58,755
|
|
Due to subsidiary
|
17
|
|
|
37
|
|
||
Other liabilities
|
26,172
|
|
|
21,193
|
|
||
Shareholders’ equity
|
403,413
|
|
|
391,547
|
|
||
Total liabilities and shareholders’ equity
|
$
|
488,513
|
|
|
$
|
471,532
|
|
|
For The Year Ended
December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Operating Income
|
|
|
|
|
|
|
|
|
|||
Dividend income from subsidiary
|
$
|
16,800
|
|
|
$
|
16,000
|
|
|
$
|
39,200
|
|
Other income (loss)
|
145
|
|
|
239
|
|
|
(18
|
)
|
|||
Total operating income
|
16,945
|
|
|
16,239
|
|
|
39,182
|
|
|||
Operating Expenses
|
|
|
|
|
|
|
|
|
|||
Interest on borrowings
|
3,408
|
|
|
3,415
|
|
|
2,734
|
|
|||
Fees to Bank
|
160
|
|
|
160
|
|
|
160
|
|
|||
Other operating expenses
|
592
|
|
|
748
|
|
|
469
|
|
|||
Total operating expenses
|
4,160
|
|
|
4,323
|
|
|
3,363
|
|
|||
Income before equity in undistributed earnings of subsidiaries and income taxes
|
12,785
|
|
|
11,916
|
|
|
35,819
|
|
|||
Equity in undistributed income (losses) of subsidiaries
|
17,405
|
|
|
26,773
|
|
|
(15,999
|
)
|
|||
Income before income taxes
|
30,190
|
|
|
38,689
|
|
|
19,820
|
|
|||
Income tax (expense) benefit
|
(1,714
|
)
|
|
1,378
|
|
|
1,132
|
|
|||
Net Income
|
$
|
28,476
|
|
|
$
|
40,067
|
|
|
$
|
20,952
|
|
|
For The Year Ended
December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Operating Activities
|
|
|
|
|
|
|
|
|
|||
Net income
|
$
|
28,476
|
|
|
$
|
40,067
|
|
|
$
|
20,952
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|||||
Equity in undistributed (income) losses of subsidiaries
|
(17,405
|
)
|
|
(26,655
|
)
|
|
4,573
|
|
|||
Gain on sale of investment securities
|
(32
|
)
|
|
(4
|
)
|
|
—
|
|
|||
(Increase) decrease in receivable from subsidiaries
|
—
|
|
|
1,819
|
|
|
(1,901
|
)
|
|||
(Increase) decrease in other assets
|
(1,930
|
)
|
|
1,213
|
|
|
(2,175
|
)
|
|||
Increase (decrease) in due to subsidiaries
|
(20
|
)
|
|
(1,179
|
)
|
|
1,216
|
|
|||
Increase (decrease) in other liabilities
|
3,721
|
|
|
(2,519
|
)
|
|
320
|
|
|||
Net cash provided by operating activities
|
12,810
|
|
|
12,742
|
|
|
22,985
|
|
|||
Investing Activities
|
|
|
|
|
|
|
|
|
|||
Acquisition of SBM, net of cash acquired
|
—
|
|
|
—
|
|
|
(25,319
|
)
|
|||
Proceeds from sale of investment securities
|
110
|
|
|
84
|
|
|
—
|
|
|||
Net cash provided by (used in) investing activities
|
110
|
|
|
84
|
|
|
(25,319
|
)
|
|||
Financing Activities
|
|
|
|
|
|
|
|
|
|||
Issuance of subordinated debt, net of issuance costs
|
—
|
|
|
—
|
|
|
14,464
|
|
|||
Exercise of stock options and issuance of restricted stock, net of repurchase for tax withholdings and tax benefit
|
(606
|
)
|
|
894
|
|
|
753
|
|
|||
Capital contribution from subsidiaries
|
1,469
|
|
|
1,997
|
|
|
836
|
|
|||
Equity issuance costs
|
—
|
|
|
—
|
|
|
(612
|
)
|
|||
Cash dividends paid on common stock and cash in-lieu paid for fractional shares due to stock split
|
(14,323
|
)
|
|
(12,393
|
)
|
|
(9,785
|
)
|
|||
Net cash provided by (used in) financing activities
|
(13,460
|
)
|
|
(9,502
|
)
|
|
5,656
|
|
|||
Net (decrease) increase in cash
|
(540
|
)
|
|
3,324
|
|
|
3,322
|
|
|||
Cash at beginning of year
|
29,905
|
|
|
26,581
|
|
|
23,259
|
|
|||
Cash at end of year
|
$
|
29,365
|
|
|
$
|
29,905
|
|
|
$
|
26,581
|
|
|
|
December 31,
|
||||||||||||||||||||||||||||||
|
|
2017
|
|
2016
|
||||||||||||||||||||||||||||
|
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
(1)
|
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
||||||||||||||||
Interest income
|
|
$
|
32,414
|
|
|
$
|
33,940
|
|
|
$
|
34,710
|
|
|
$
|
35,040
|
|
|
$
|
31,981
|
|
|
$
|
32,775
|
|
|
$
|
32,594
|
|
|
$
|
32,276
|
|
Interest expense
|
|
4,559
|
|
|
5,314
|
|
|
5,550
|
|
|
5,381
|
|
|
4,029
|
|
|
4,271
|
|
|
4,222
|
|
|
4,032
|
|
||||||||
Net interest income
|
|
27,855
|
|
|
28,626
|
|
|
29,160
|
|
|
29,659
|
|
|
27,952
|
|
|
28,504
|
|
|
28,372
|
|
|
28,244
|
|
||||||||
Provision for credit losses
|
|
579
|
|
|
1,401
|
|
|
817
|
|
|
238
|
|
|
872
|
|
|
2,852
|
|
|
1,279
|
|
|
255
|
|
||||||||
Non-interest income
|
|
8,572
|
|
|
9,888
|
|
|
10,299
|
|
|
9,840
|
|
|
7,917
|
|
|
10,552
|
|
|
11,001
|
|
|
10,151
|
|
||||||||
Non-interest expense
|
|
21,428
|
|
|
22,158
|
|
|
21,825
|
|
|
23,099
|
|
|
22,909
|
|
|
22,330
|
|
|
22,149
|
|
|
22,508
|
|
||||||||
Income before income taxes
|
|
14,420
|
|
|
14,955
|
|
|
16,817
|
|
|
16,162
|
|
|
12,088
|
|
|
13,874
|
|
|
15,945
|
|
|
15,632
|
|
||||||||
Income tax expense
|
|
4,344
|
|
|
4,721
|
|
|
5,478
|
|
|
19,335
|
|
|
3,442
|
|
|
4,258
|
|
|
5,042
|
|
|
4,730
|
|
||||||||
Net income (loss)
|
|
$
|
10,076
|
|
|
$
|
10,234
|
|
|
$
|
11,339
|
|
|
$
|
(3,173
|
)
|
|
$
|
8,646
|
|
|
$
|
9,616
|
|
|
$
|
10,903
|
|
|
$
|
10,902
|
|
Per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Basic
|
|
$
|
0.65
|
|
|
$
|
0.66
|
|
|
$
|
0.72
|
|
|
$
|
(0.20
|
)
|
|
$
|
0.56
|
|
|
$
|
0.62
|
|
|
$
|
0.70
|
|
|
$
|
0.70
|
|
Diluted
|
|
$
|
0.64
|
|
|
$
|
0.66
|
|
|
$
|
0.72
|
|
|
$
|
(0.20
|
)
|
|
$
|
0.56
|
|
|
$
|
0.62
|
|
|
$
|
0.70
|
|
|
$
|
0.70
|
|
(1)
|
In the fourth quarter of 2017, the Company recognized
$14.3 million
of additional income tax expense upon the revaluation of its deferred tax assets and liabilities upon enactment of the Tax Act on December 22, 2017, which lowered the federal corporate tax rate from 35.0% to 21.0%, effective January 1, 2018. The impact to fourth quarter 2017 basic and diluted EPS was
$0.91
per share.
|
|
Number of Securities to Be Issued Upon Exercise of Outstanding Options, Warrants and Rights
(a)
|
|
Weighted Average Exercise Price of Outstanding Options, Warrants and Rights
(b)
|
|
Number of Securities Remaining Available for Future Issuance (Excluding Securities in Column (a))
(c)
(1)
|
|||||
Equity compensation plans approved by shareholders
|
173,300
|
|
|
$
|
6.36
|
|
|
960,473
|
|
|
Equity compensation plans not approved by shareholders
|
—
|
|
|
—
|
|
|
—
|
|
|
|
Total
|
173,300
|
|
|
$
|
6.36
|
|
|
960,473
|
|
|
(1)
|
Represents the 1.2 million shares available under the 2012 Equity and Incentive Plan less awards granted plus shares added back due to the forfeiture, cancellation or reacquisition by the Company for the settlement of an award to cover the exercise price or tax withholding under the current and previous plans.
|
|
|
|
Page
|
Exhibit
No.
|
|
Definition
|
|
||
|
||
21
*
|
|
|
23.1
*
|
|
|
31.1
*
|
|
|
31.2
*
|
|
|
32.1
**
|
|
|
32.2
**
|
|
|
101
|
|
The following materials from the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Stockholders’ Equity, (iv) the Consolidated Statements of Comprehensive Income (v) the Consolidated Statements of Cash Flows, and (vi) related notes to these financial statements.
|
*
|
Filed herewith
|
**
|
Furnished herewith
|
+
|
Management contract or a compensatory plan or arrangement.
|
Date: March 9, 2018
|
|
CAMDEN NATIONAL CORPORATION
|
|
|
/s/ Gregory A. Dufour
|
|
|
Gregory A. Dufour
President and Chief Executive Officer
|
Name
|
|
Position
|
|
Date
|
/s/ Gregory A. Dufour
|
|
President, Director and Chief Executive Officer
|
|
March 9, 2018
|
Gregory A. Dufour
|
|
|
|
|
/s/ Deborah A. Jordan
|
|
Chief Operating Officer, Chief Financial Officer, and Principal Financial and Accounting Officer
|
|
March 9, 2018
|
Deborah A. Jordan
|
|
|
|
|
/s/ Lawrence J. Sterrs
|
|
Chair and Director
|
|
March 9, 2018
|
Lawrence J. Sterrs
|
|
|
|
|
/s/ Ann W. Bresnahan
|
|
Director
|
|
March 9, 2018
|
Ann W. Bresnahan
|
|
|
|
|
/s/ Craig N. Denekas
|
|
Director
|
|
March 9, 2018
|
Craig N. Denekas
|
|
|
|
|
/s/ David C. Flanagan
|
|
Director
|
|
March 9, 2018
|
David C. Flanagan
|
|
|
|
|
/s/ S. Catherine Longley
|
|
Director
|
|
March 9, 2018
|
S. Catherine Longley
|
|
|
|
|
/s/ David J. Ott
|
|
Director
|
|
March 9, 2018
|
David J. Ott
|
|
|
|
|
/s/ James H. Page
|
|
Director
|
|
March 9, 2018
|
James H. Page
|
|
|
|
|
/s/ Carl J. Soderberg
|
|
Director
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March 9, 2018
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Carl J. Soderberg
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1.1
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“Beneficiary” shall mean the person or persons entitled to receive the balance credited to a Participant’s Account under the Plan upon the death of the Participant, as provided in Section 5.2.
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1.2
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“Bonus” shall mean the performance-based compensation paid to participants under the Executive Incentive Plan.
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1.3
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“Change of Control” shall have the meaning provided to such term in the 2012 Incentive Plan.
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1.4
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“Compensation” shall mean gross salary and Bonus payable before pre-tax deferrals with respect to other benefit plans and deferred compensation arrangements, excluding imputed income and any items of extraordinary compensation determined by the Administrator to be excluded for purposes of this Plan.
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1.5
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"Disability" shall have the same meaning as provided in the 2012 Incentive Plan for Awards that are determined to be subject to Code Section 409A.
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1.6
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“Employer” shall mean the Company and each participating Subsidiary. At such times and under such conditions as the Board may direct, one or more other Subsidiary may become participating Subsidiaries or a participating Subsidiary may be withdrawn from the Plan.
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1.7
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“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended. Reference to a specific section of ERISA shall include such section, any valid regulation promulgated thereunder, and any comparable provision of any future legislation amending, supplementing or superseding such section.
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1.8
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“Participant” shall mean an Employee who has become a Participant in the Plan pursuant to Section 2.1 and has not ceased to be a Participant pursuant to Section 2.2.
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1.9
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“Participant’s Account” or “Account” shall mean, as to any Participant, the separate account maintained on the books of the Company in order to reflect his or her interest under the Plan.
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1.10
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“Plan” shall mean the Camden National Corporation Second Amended and Restated Defined Contribution Retirement Plan, as set forth in this instrument and as hereafter amended from time to time.
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1.11
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“Plan Year” shall mean the calendar year.
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1.12
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“Termination of Employment” shall mean a reduction in the services provided by the Participant to the Employer to a level that is 20% or less than the level of services so provided for the 36 months immediately preceding such reduction.
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2.1
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Participation. Participation in the Plan by an Employee must be approved by the Committee and will begin as of January 1 of the Plan Year following approval by the Committee.
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2.2
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Termination of Participation. An Employee who has become a Participant shall remain a Participant until his or her entire Vested Amount (as defined below) is distributed or forfeited, as applicable.
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3.1
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At the direction of the Committee, there shall be established and maintained an Account on the books of the Company for each Participant.
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3.2
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Annually, on March 15 (or the closest business day to March 15), beginning during the first year of participation in the Plan, the Committee will credit each Participant’s Account with an amount equal to ten (10) percent of the Participant’s Compensation in the prior calendar year. This date will be referenced as the Grant Date. For Participants that begin employment with the Company on or after January 1, 2017, a pro rata contribution will be made with respect to the Participant’s first year of employment. For example, if the Participant began employment with the Company on July 1, 2017, the Company would make a contribution on March 15, 2018 equaling ten percent of the Participant’s Compensation for the six months of 2017 in which the Participant was employed with the Company.
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3.3
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Annual credits to a Participant’s Account, based on the amount in Section 3.2, shall be denominated in Deferred Stock Awards (rounded down to the nearest whole share) based on the fair market value of the Company Stock on the Grant Date.
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3.4
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Each Participant shall be furnished with periodic statements of his or her Account, at least annually, reflecting the status of his or her interest in the Plan.
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4.1
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The terms of a Participant’s vesting shall be determined by separate agreement with the Participant, provided, however, that for any employee that is an active Participant as of the date this Plan is adopted, vesting shall occur ratably (rounded to the nearest percent) over the period from the first day of participation until the Participant reaches age 65, at which time the Participant is one hundred (100) percent vested. Each Participant will be furnished with a copy of his or her unique vesting schedule upon approval for participation by the Committee, which will show the Vested Percentage for each anniversary.
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4.2
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Anything to the contrary in this Plan notwithstanding, the balance in the Account will be immediately forfeited, and all rights of the Participant and his or her beneficiaries hereunder shall become null and void, if the Participant’s employment with the Company is terminated for Cause.
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5.1
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No distributions shall be made from the Account of a Participant until the Participant Terminates Employment with the Company, except as provided in Section 10 below. The portion of the Account to be distributed will be equal to the Deferred Stock Awards in the Account times the Vested Percentage from Section 4.1, the result being the Vested Amount. The Vested Amount will be reduced by the amount required to be withheld for income taxes, and the net Vested Amount will be distributed in shares of Company Stock. Amounts contributed to Participants’ accounts prior to 2014 shall be distributed in one lump sum distribution within ninety (90) days of the Termination of Employment, except as provided in Section 5.5 below. For amounts contributed to Participants’ accounts in 2014 and thereafter, a Participant may elect to have the amounts distributed in annual installments over 5, 10 or 15 years. Such election shall be irrevocably made no later than December 31, 2013, except that, with respect to the first year in which an individual becomes a Participant in this Plan, that Participant shall make his or her election, with respect to future compensation only, within 30 days of becoming a Participant. All shares of Company Stock that are distributed to “insiders” (as that term is defined in the Securities and Exchange Act of 1933) shall be subject to the rules and regulations about the purchase and sale of Company Stock.
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a.
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In the event the total amount remaining due under the installment payments described in this Section 5.1 becomes less than the IRS limit under section 402(g) of the Code for the year in which the next installment payment is due, the Company may, in its sole discretion, pay to the Participant the entire amount remaining due in a lump sum on or before the due date of the next installment payment.
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5.2
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If the Participant terminates employment due to death or Disability, the Account will be one hundred (100) percent vested regardless of the actual years of participation in the Plan. The Participant may designate in writing a Beneficiary to receive any distribution which may become payable as the result of the Participant’s death. If no Beneficiary designation is in effect upon the Participant’s death, the Beneficiary shall be the Participant’s estate.
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5.3
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Effect of a Change of Control. If there is a Change of Control, then, notwithstanding any other provision of this Plan, the following shall occur:
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•
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A Participant shall be one hundred (100) percent vested in the Participant’s Account if, the Participant incurs a Termination of Employment either (i) by the Company without Cause (as defined below), or (ii) by the participant with Good Reason (as defined below), in each case, either (x) within two (2) years following a Change of Control or (y) within three (3) months prior to a Change of Control, provided a definitive agreement with respect to such Change of Control has been entered into by the parties thereto as of the date of such Termination of Employment, with such accelerated vesting effective as of the date of such Termination of Employment.
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The Change of Control itself shall not constitute a distributable event, except with respect to a special Plan termination under Section 10.4.
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5.4
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If a Participant under the Plan qualifies as a “Specified Employee” as defined in Code Section 409A, and the stock of the Company or any affiliate is publicly traded, no distribution may be made hereunder until six (6) months after the Participant’s separation from service as defined under Code Section 409A (or, if earlier, the date of death of the Participant).
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5.5
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Notwithstanding any other provision in this Plan to the contrary, no distributions may be made under this Plan prior to the occurrence of a distribution event as defined in Code Section 409A(a)(2), except and to the extent that the Plan may currently allow or hereafter be amended to allow an acceleration of payment under one of the applicable exceptions contained in Treasury Regulation Section 1.409A-3(j)(4).
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6.1
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Claim for Benefits. The following Claim and Appeal Procedures are intended to satisfy the minimum standards of Section 503 of ERISA pursuant to which individuals or estates may claim Plan benefits and appeal denials of such claims. Any claim for benefits or other rights under the Plan shall be made in writing to the Administrator. If such claim is wholly or partially denied by the Administrator, the Administrator shall, within a reasonable period of time, but not later than sixty (60) days after receipt of the claim, notify the claimant of the denial of the claim. Such notice of denial shall be in writing and shall contain:
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6.2
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Requests for Review of a Denial of a Claim. Upon the receipt by the claimant of written notice of the denial of a claim, the claimant may within ninety (90) days file a written request to the Administrator requesting a review of the denial of the claim. Such review shall include a hearing if deemed necessary by the Administrator. In connection with the claimant’s appeal of the denial of his or her claim, the claimant may review relevant documents and may submit issues and comments in writing. To provide for fair review and a full record, the claimant must submit in writing all facts, reasons and arguments in support of his or her position within the time allowed for filing a written request for review. All issues and matters not raised for review will be deemed waived by the claimant.
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6.3
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Decision upon Review of a Denial of a Claim. The Administrator shall render a decision on the claim review promptly, but no more than sixty (60) days after the receipt of the claimant’s request for review, unless special circumstances (such as the need to hold a hearing) require an extension of time, in which case the sixty (60) day period shall be extended to one hundred-twenty (120) days. Such decision shall:
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a.
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Mediation. If a claimant is not satisfied with the denial of his or her claim under the review procedures of Section 6.3, the claimant and the Company may try to settle the claim in good faith through mediation administered by the American Arbitration Association under its Commercial Mediation Procedures. The parties shall share equally the mediator’s costs and fees, and bear separately their own respective costs of mediation. All mediation shall be conducted at a mutually agreeable convenient location within the State of Maine. Mediation records shall not be admissible in any subsequent litigation and the positions of the parties taken in mediation shall not be binding or taken as any concession, representation or waiver, outside of the mediation process.
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b.
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Litigation. No litigation may be commenced by or on behalf of a claimant with respect to this Plan until after the claim review and mediation process described in this Section 6 has been exhausted. Judicial review of Administrator action shall be limited to whether the Administrator acted in an arbitrary and capricious manner.
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7.1
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Unfunded Plan. All amounts credited to a Participant’s Account under the Plan shall continue for all purposes to be a part of the general assets of the Company. The interest of the Participant in his or her Account, including his or her right to distribution thereof, shall be an unsecured claim against the general assets of the Company. Although the Company may choose to invest a portion of its general assets for purposes of enabling it to make distributions under the Plan, nothing contained in the Plan shall give any Participant or beneficiary any interest in or claim against any specific assets of the Company.
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8.1
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Right to Amend or Terminate
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The Plan may be amended in whole or in part by a written instrument adopted by the Board (or the Board’s designee) at any time. Notice of any material amendment shall be given in writing to each Participant. No amendment shall retroactively decrease either the balance of a Participant’s Account or a Participant’s interest in his or her Account as existing immediately prior to the later of the effective date or adoption date of such amendment. No amendment shall change the time or form of any payment due hereunder unless such change conforms to the requirements of Code Section 409A.
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8.2
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Company’s Right to Terminate. The Company reserves the sole right to terminate the Plan, in whole or in part, by action of its Board at any time. In the event of any such termination, each affected Participant shall maintain his or her vesting percentage in his or her Plan Accounts determined as of the Plan termination date, and shall be entitled to receive a distribution upon the occurrence of the first Code Section 409A distributable event thereafter. Consequently, the Account of each affected Participant shall be distributed in the manner provided in Section 5 to the extent such Plan termination may be treated as a distributable event under Code Section 409A. Notwithstanding the foregoing, any distributions upon a Plan termination hereunder shall be made in such time and manner, and subject to such other conditions (if any are applicable), as will comply with the termination rules under Treasury Regulation 1.409A-3(j)(4)(ix).
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9.1
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As a condition of this Agreement, the Executive hereby covenants and agrees that he or she will abide by the terms of the separately executed Confidentiality, Non-Competition and Non-Solicitation Agreement (“Non-Competition Agreement”). If the Executive breaches the Non-Competition Agreement in any way, any and all benefits and awards due to the Executive under the terms of this Agreement shall be void and forfeited. Any benefits previously distributed to the Executive under this Agreement (“Prior Payments”) shall be subject to automatic recoupment, and the Executive shall immediately return Prior Payments to the Company.
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10.1
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Inalienability. In no event may either a Participant, a former Participant or his or her beneficiary, spouse or estate sell, transfer, anticipate, assign, hypothecate, or otherwise dispose of any right or interest under the Plan; and such rights and interests shall not at any time be subject to the claims of creditors nor be liable to attachment, execution or other
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10.2
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Rights and Duties. Neither the Employer nor the Committee shall be subject to any liability or duty under the Plan except as expressly provided in the Plan, or for any action taken, omitted or suffered in good faith.
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10.3
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No Enlargement of Employment Rights. Neither the establishment or maintenance of the Plan, nor any action of the Employer or the Committee, shall be held or construed to confer upon any individual any right to be continued as an Employee nor, upon dismissal, any right or interest in any specific assets of the Employer other than as provided in the Plan. The Employer expressly reserves the right to discharge any Employee at any time.
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10.4
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Apportionment of Costs and Duties. All acts required of the Employer under the Plan may be performed by the Company for itself and its Subsidiaries, and the costs of the Plan may be equitably apportioned by the Committee among the Company and the other participating Subsidiaries. Whenever the Employer is permitted or required under the terms of the Plan to do or perform any act, matter or thing, it shall be done and performed by any officer or employee of the Employer who is thereunto duly authorized by the Board.
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10.5
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Applicable Law. The provisions of the Plan with the laws of the State of Maine, to the extent not preempted by federal law.
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10.6
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Severability. If any provision of the Plan is held invalid or unenforceable, its invalidity or unenforceability shall not affect any other provisions of the Plan, and in lieu of each provision which is held invalid or unenforceable, there shall be added as part of the Plan a provision that shall be as similar in terms to such invalid or unenforceable provision as may be possible and be valid, legal, and enforceable.
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10.7
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Captions. The captions contained in, and the table of contents prefixed to, the Plan are inserted only as a matter of convenience and for reference and in no way define, limit, enlarge or describe the scope or intent of the Plan, nor in any way shall affect the construction of any provision of the Plan.
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10.8
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Compliance with Code Section 409A. This Plan constitutes a so-called non-qualified deferred compensation plan as defined in Code Section 409A and is intended to comply with the requirements of Code Section 409A. Any interpretations or administrative action required under this Plan shall be made in a manner so as to continue the qualification of the Plan under Code Section 409A and the Treasury Regulations thereunder.
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Dated: January 30, 2018
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By:
/s/ Gregory A. Dufour
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_________________________________
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____________________________________
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Executive
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Date
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/s/ RSM US LLP
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RSM US LLP
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New York, New York
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March 9, 2018
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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 (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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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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Date: March 9, 2018
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/s/ Gregory A. Dufour
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Gregory A. Dufour
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President and Chief Executive Officer
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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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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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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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Date: March 9, 2018
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/s/ Deborah A. Jordan
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Deborah A. Jordan
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Chief Operating Officer, Chief Financial Officer and Principal Financial & Accounting Officer
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Date: March 9, 2018
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/s/ Gregory A. Dufour
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Gregory A. Dufour
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President and Chief Executive Officer
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Date: March 9, 2018
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/s/ Deborah A. Jordan
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Deborah A. Jordan
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Chief Operating Officer, Chief Financial Officer and Principal Financial & Accounting Officer
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