Large accelerated filer ☐
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Accelerated filer ☒
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Non-accelerated filer ☐
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Smaller reporting company ☐
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TABLE OF CONTENTS
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Page
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•
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Various demand deposit accounts, savings accounts, money market accounts, and certificates of deposit;
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•
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Commercial, consumer, and real estate mortgage loans and lines of credit;
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•
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Debit cards;
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•
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Cashier’s checks;
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•
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Safe deposit rental facilities; and
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•
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Non-deposit investment services.
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December 2017
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December 2016
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December 2015
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|||
Berkeley County, WV
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3.6
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%
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3.0
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%
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3.8
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%
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Harrison County, WV
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4.8
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%
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4.9
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%
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5.8
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%
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Jefferson County, WV
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3.0
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%
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2.6
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%
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3.1
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%
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Marion County, WV
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5.5
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%
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5.1
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%
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5.9
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%
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Monongalia County, WV
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3.6
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%
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3.3
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%
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3.8
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%
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Kanawha County, WV
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5.1
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%
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|
4.7
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%
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5.2
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%
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Fairfax County, VA
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2.6
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%
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3.0
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%
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3.1
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%
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Loudoun County, VA
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2.7
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%
|
|
3.0
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%
|
|
3.1
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%
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2017
|
||||||||||||||||||
(Dollars in thousands)
|
|
Commercial & Retail Banking
|
|
Mortgage Banking
|
|
Financial Holding Company
|
|
Intercompany Eliminations
|
|
Consolidated
|
||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest income
|
|
$
|
52,423
|
|
|
$
|
4,698
|
|
|
$
|
4
|
|
|
$
|
(527
|
)
|
|
$
|
56,598
|
|
Mortgage fee income
|
|
736
|
|
|
37,262
|
|
|
—
|
|
|
(849
|
)
|
|
37,149
|
|
|||||
Insurance and investment services income
|
|
563
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
563
|
|
|||||
Other income
|
|
5,303
|
|
|
(2,372
|
)
|
|
5,466
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|
|
(5,403
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)
|
|
2,994
|
|
|||||
Total operating income
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|
59,025
|
|
|
39,588
|
|
|
5,470
|
|
|
(6,779
|
)
|
|
97,304
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|
|||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense
|
|
9,118
|
|
|
2,317
|
|
|
2,241
|
|
|
(1,375
|
)
|
|
12,301
|
|
|||||
Salaries and employee benefits
|
|
12,266
|
|
|
26,196
|
|
|
5,646
|
|
|
—
|
|
|
44,108
|
|
|||||
Provision for loan losses
|
|
1,967
|
|
|
206
|
|
|
—
|
|
|
—
|
|
|
2,173
|
|
|||||
Other expense
|
|
19,523
|
|
|
8,188
|
|
|
4,085
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|
(5,404
|
)
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26,392
|
|
|||||
Total operating expenses
|
|
42,874
|
|
|
36,907
|
|
|
11,972
|
|
|
(6,779
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)
|
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84,974
|
|
|||||
Income (loss) from continuing operations, before income taxes
|
|
16,151
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|
|
2,681
|
|
|
(6,502
|
)
|
|
—
|
|
|
12,330
|
|
|||||
Income tax expense (benefit) - continuing operations
|
|
5,820
|
|
|
1,082
|
|
|
(2,147
|
)
|
|
—
|
|
|
4,755
|
|
|||||
Net income (loss) from continuing operations
|
|
10,331
|
|
|
1,599
|
|
|
(4,355
|
)
|
|
—
|
|
|
7,575
|
|
|||||
Income (loss) from discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Income tax expense (benefit) - discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net income (loss) from discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
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|
|||||
Net income (loss)
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|
$
|
10,331
|
|
|
$
|
1,599
|
|
|
$
|
(4,355
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)
|
|
$
|
—
|
|
|
$
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7,575
|
|
Preferred stock dividends
|
|
—
|
|
|
—
|
|
|
498
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|
|
—
|
|
|
498
|
|
|||||
Net income (loss) available to common shareholders
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|
$
|
10,331
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|
|
$
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1,599
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|
|
$
|
(4,853
|
)
|
|
$
|
—
|
|
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$
|
7,077
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital Expenditures for the year ended December 31, 2017
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$
|
3,226
|
|
|
$
|
1,187
|
|
|
$
|
83
|
|
|
$
|
—
|
|
|
$
|
4,496
|
|
Total Assets as of December 31, 2017
|
|
1,533,497
|
|
|
149,323
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|
|
184,600
|
|
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(333,118
|
)
|
|
1,534,302
|
|
|||||
Goodwill as of December 31, 2017
|
|
1,598
|
|
|
16,882
|
|
|
—
|
|
|
—
|
|
|
18,480
|
|
|
|
2016
|
||||||||||||||||||||||
(Dollars in thousands)
|
|
Commercial & Retail Banking
|
|
Mortgage Banking
|
|
Financial Holding Company
|
|
Insurance
|
|
Intercompany Eliminations
|
|
Consolidated
|
||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest income
|
|
$
|
50,413
|
|
|
$
|
4,285
|
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
(578
|
)
|
|
$
|
54,123
|
|
Mortgage fee income
|
|
(252
|
)
|
|
36,960
|
|
|
—
|
|
|
—
|
|
|
(1,035
|
)
|
|
35,673
|
|
||||||
Insurance and investment services income
|
|
420
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
420
|
|
||||||
Other income
|
|
5,485
|
|
|
1,674
|
|
|
5,247
|
|
|
—
|
|
|
(5,294
|
)
|
|
7,112
|
|
||||||
Total operating income
|
|
56,066
|
|
|
42,919
|
|
|
5,250
|
|
|
—
|
|
|
(6,907
|
)
|
|
97,328
|
|
||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest expense
|
|
8,437
|
|
|
2,082
|
|
|
2,226
|
|
|
—
|
|
|
(1,613
|
)
|
|
11,132
|
|
||||||
Salaries and employee benefits
|
|
11,592
|
|
|
27,696
|
|
|
5,937
|
|
|
—
|
|
|
—
|
|
|
45,225
|
|
||||||
Provision for loan losses
|
|
3,632
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,632
|
|
||||||
Other expense
|
|
18,009
|
|
|
8,125
|
|
|
3,144
|
|
|
—
|
|
|
(5,294
|
)
|
|
23,984
|
|
||||||
Total operating expenses
|
|
41,670
|
|
|
37,903
|
|
|
11,307
|
|
|
—
|
|
|
(6,907
|
)
|
|
83,973
|
|
||||||
Income (loss) from continuing operations, before income taxes
|
|
14,396
|
|
|
5,016
|
|
|
(6,057
|
)
|
|
—
|
|
|
—
|
|
|
13,355
|
|
||||||
Income tax expense (benefit) - continuing operations
|
|
4,496
|
|
|
1,954
|
|
|
(2,072
|
)
|
|
—
|
|
|
—
|
|
|
4,378
|
|
||||||
Net income (loss) from continuing operations
|
|
9,900
|
|
|
3,062
|
|
|
(3,985
|
)
|
|
—
|
|
|
—
|
|
|
8,977
|
|
||||||
Income (loss) from discontinued operations
|
|
—
|
|
|
—
|
|
|
6,926
|
|
|
(580
|
)
|
|
—
|
|
|
6,346
|
|
||||||
Income tax expense (benefit) - discontinued operations
|
|
—
|
|
|
—
|
|
|
2,629
|
|
|
(218
|
)
|
|
—
|
|
|
2,411
|
|
||||||
Net income (loss) from discontinued operations
|
|
—
|
|
|
—
|
|
|
4,297
|
|
|
(362
|
)
|
|
—
|
|
|
3,935
|
|
||||||
Net income (loss)
|
|
$
|
9,900
|
|
|
$
|
3,062
|
|
|
$
|
312
|
|
|
$
|
(362
|
)
|
|
$
|
—
|
|
|
$
|
12,912
|
|
Preferred stock dividends
|
|
—
|
|
|
—
|
|
|
1,128
|
|
|
—
|
|
|
—
|
|
|
1,128
|
|
||||||
Net income (loss) available to common shareholders
|
|
$
|
9,900
|
|
|
$
|
3,062
|
|
|
$
|
(816
|
)
|
|
$
|
(362
|
)
|
|
$
|
—
|
|
|
$
|
11,784
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Capital Expenditures for the year ended December 31, 2016
|
|
$
|
1,145
|
|
|
$
|
220
|
|
|
$
|
303
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,668
|
|
Total Assets as of December 31, 2016
|
|
1,415,735
|
|
|
122,242
|
|
|
180,340
|
|
|
—
|
|
|
(299,513
|
)
|
|
1,418,804
|
|
||||||
Goodwill as of December 31, 2016
|
|
1,598
|
|
|
16,882
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18,480
|
|
|
|
2015
|
||||||||||||||||||||||
(Dollars in thousands)
|
|
Commercial & Retail Banking
|
|
Mortgage Banking
|
|
Financial Holding Company
|
|
Insurance
|
|
Intercompany Eliminations
|
|
Consolidated
|
||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest income
|
|
$
|
40,524
|
|
|
$
|
3,882
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
(308
|
)
|
|
$
|
44,100
|
|
Mortgage fee income
|
|
7
|
|
|
30,560
|
|
|
—
|
|
|
—
|
|
|
(1,095
|
)
|
|
29,472
|
|
||||||
Insurance and investment services income
|
|
338
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
338
|
|
|||||||
Other income
|
|
3,721
|
|
|
1,673
|
|
|
4,331
|
|
|
—
|
|
|
(4,580
|
)
|
|
5,145
|
|
||||||
Total operating income
|
|
44,590
|
|
|
36,115
|
|
|
4,333
|
|
|
—
|
|
|
(5,983
|
)
|
|
79,055
|
|
||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest expense
|
|
6,776
|
|
|
1,647
|
|
|
2,204
|
|
|
—
|
|
|
(1,402
|
)
|
|
9,225
|
|
||||||
Salaries and employee benefits
|
|
11,049
|
|
|
20,774
|
|
|
4,250
|
|
|
—
|
|
|
—
|
|
|
36,073
|
|
||||||
Provision for loan losses
|
|
2,493
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,493
|
|
||||||
Other expense
|
|
16,132
|
|
|
7,471
|
|
|
2,534
|
|
|
—
|
|
|
(4,362
|
)
|
|
21,775
|
|
||||||
Total operating expenses
|
|
36,450
|
|
|
29,892
|
|
|
8,988
|
|
|
—
|
|
|
(5,764
|
)
|
|
69,566
|
|
||||||
Income (loss) from continuing operations, before income taxes
|
|
8,140
|
|
|
6,223
|
|
|
(4,655
|
)
|
|
—
|
|
|
(219
|
)
|
|
9,489
|
|
||||||
Income tax expense (benefit) - continuing operations
|
|
2,176
|
|
|
2,394
|
|
|
(1,597
|
)
|
|
—
|
|
|
(87
|
)
|
|
2,886
|
|
||||||
Net income (loss) from continuing operations
|
|
5,964
|
|
|
3,829
|
|
|
(3,058
|
)
|
|
—
|
|
|
(132
|
)
|
|
6,603
|
|
||||||
Income (loss) from discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
134
|
|
|
219
|
|
|
353
|
|
||||||
Income tax expense (benefit) - discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
53
|
|
|
87
|
|
|
140
|
|
||||||
Net income (loss) from discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
81
|
|
|
132
|
|
|
213
|
|
||||||
Net income (loss)
|
|
$
|
5,964
|
|
|
$
|
3,829
|
|
|
$
|
(3,058
|
)
|
|
$
|
81
|
|
|
$
|
—
|
|
|
$
|
6,816
|
|
Preferred stock dividends
|
|
—
|
|
|
—
|
|
|
575
|
|
|
—
|
|
|
—
|
|
|
575
|
|
||||||
Net income (loss) available to common shareholders
|
|
$
|
5,964
|
|
|
$
|
3,829
|
|
|
$
|
(3,633
|
)
|
|
$
|
81
|
|
|
$
|
—
|
|
|
$
|
6,241
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Capital Expenditures for the year ended December 31, 2015
|
|
$
|
1,174
|
|
|
$
|
354
|
|
|
$
|
616
|
|
|
$
|
9
|
|
|
$
|
—
|
|
|
$
|
2,153
|
|
Total Assets as of December 31, 2015
|
|
1,378,988
|
|
|
125,227
|
|
|
148,509
|
|
|
5,017
|
|
|
(273,265
|
)
|
|
1,384,476
|
|
||||||
Goodwill as of December 31, 2015
|
|
1,598
|
|
|
16,882
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18,480
|
|
•
|
In general, for a given change in interest rates, the amount of change in value (positive or negative) is larger for assets and liabilities with longer remaining maturities. The shape of the yield curve may affect new loan yields, funding costs and investment income differently.
|
•
|
The remaining maturity of various assets or liabilities may shorten or lengthen as payment behavior changes in response to changes in interest rates. For example, if interest rates decline sharply, loans may pre-pay, or pay down, faster than anticipated, thus reducing future cash flows and interest income. Conversely, if interest rates increase, depositors may cash
|
•
|
Re-pricing frequencies and maturity profiles for assets and liabilities may occur at different times. For example, in a falling rate environment, if assets re-price faster than liabilities, there will be an initial decline in earnings. Moreover, if assets and liabilities re-price at the same time, they may not be by the same increment. For instance, if the Federal Funds Rate increased
50
basis points, rates on demand deposits may rise by
10
basis points; whereas rates on prime-based loans will instantly rise
50
basis points.
|
•
|
The ability to develop, maintain and build long-term customer relationships based on top quality service, high ethical standards and safe, sound assets.
|
•
|
The ability to expand our market position.
|
•
|
The scope, relevance and pricing of products and services offered to meet customer needs and demands.
|
•
|
The rate at which we introduce new products and services relative to our competitors.
|
•
|
Customer satisfaction with our level of service.
|
•
|
Industry and general economic trends.
|
•
|
Potential exposure to unknown or contingent liabilities of the target company.
|
•
|
Exposure to potential asset quality issues of the target company.
|
•
|
Potential disruption to our business.
|
•
|
Potential diversion of our management’s time and attention.
|
•
|
The possible loss of key employees and customers of the target company.
|
•
|
Difficulty in estimating the value of the target company.
|
•
|
Potential changes in banking or tax laws or regulations that may affect the target company.
|
•
|
actual or anticipated variations in quarterly results of operations;
|
•
|
recommendations by securities analysts;
|
•
|
operating and stock price performance of other companies that investors deem comparable to us;
|
•
|
news reports relating to trends, concerns and other issues in the financial services industry;
|
•
|
perceptions in the marketplace regarding us and/or our competitors;
|
•
|
new technology used, or services offered, by competitors;
|
•
|
significant acquisitions or business combinations, strategic partnerships, joint ventures or capital commitments by or involving us or our competitors;
|
•
|
failure to integrate acquisitions or realize anticipated benefits from acquisitions;
|
•
|
changes in government regulations; and
|
•
|
geopolitical conditions such as acts or threats of terrorism or military conflicts.
|
Quarterly Market and Dividend Information:
|
||||||||||||||||
|
|
High
|
|
Low
|
|
Last
|
|
Dividend
|
||||||||
2017
|
|
|
|
|
|
|
|
|
||||||||
Fourth Quarter
|
|
$
|
20.40
|
|
|
$
|
18.26
|
|
|
$
|
20.10
|
|
|
$
|
0.025
|
|
Third Quarter
|
|
18.90
|
|
|
13.05
|
|
|
18.80
|
|
|
0.025
|
|
||||
Second Quarter
|
|
13.25
|
|
|
12.55
|
|
|
13.20
|
|
|
0.025
|
|
||||
First Quarter
|
|
14.00
|
|
|
12.70
|
|
|
12.75
|
|
|
0.025
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
2016
|
|
|
|
|
|
|
|
|
||||||||
Fourth Quarter
|
|
$
|
13.05
|
|
|
$
|
11.50
|
|
|
$
|
12.80
|
|
|
$
|
0.02
|
|
Third Quarter
|
|
13.50
|
|
|
11.95
|
|
|
12.31
|
|
|
0.02
|
|
||||
Second Quarter
|
|
14.00
|
|
|
12.06
|
|
|
12.95
|
|
|
0.02
|
|
||||
First Quarter
|
|
13.99
|
|
|
9.50
|
|
|
13.40
|
|
|
0.02
|
|
Plan Category
|
|
Number of securities to be issued upon exercise of outstanding options (a)
|
|
Weighted-average exercise price of outstanding options (b)
|
|
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c)
|
||||
Equity compensation plans approved by security holders
|
|
910,647
|
|
|
$
|
13.00
|
|
|
1,173,575
|
|
Equity compensation plans not approved by security holders
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
|
Total
|
|
910,647
|
|
|
$
|
13.00
|
|
|
1,173,575
|
|
Index
|
|
12/31/2012
|
|
12/31/2013
|
|
12/31/2014
|
|
12/31/2015
|
|
12/31/2016
|
|
12/31/2017
|
||||||||||||
MVB Financial Corp.
|
|
$
|
100.00
|
|
|
$
|
138.96
|
|
|
$
|
126.21
|
|
|
$
|
111.13
|
|
|
$
|
109.29
|
|
|
$
|
170.96
|
|
KBW Bank Index
|
|
100.00
|
|
|
125.06
|
|
|
134.09
|
|
|
131.96
|
|
|
165.75
|
|
|
192.69
|
|
||||||
Russell 2000
|
|
100.00
|
|
|
137.00
|
|
|
141.84
|
|
|
133.74
|
|
|
159.78
|
|
|
180.79
|
|
•
|
statements with respect to the beliefs, plans, objectives, goals, guidelines, expectations, anticipations, and future financial condition, results of operations and performance of the Company and its subsidiary (collectively “we,” “our,” or “us), including the Bank; and
|
•
|
statements preceded by, followed by or that include the words “may,” “could,” “should,” “would,” “believe,” “anticipate,” “estimate,” “expect,” “intend,” “plan,” “projects,” “outlook” or similar expressions.
|
•
|
the ability of the Company, the Bank, and MVB Mortgage to successfully execute business plans, manage risks, and achieve objectives;
|
•
|
changes in local, national and international political and economic conditions, including without limitation changes in the political and economic climate, continued recovery from the recent economic crisis, delay of recovery from that crisis, economic conditions and fiscal imbalances in the United States and other countries, potential or actual downgrades in rating of sovereign debt issued by the United States and other countries, and other major developments, including wars, natural disasters, military actions, and terrorist attacks;
|
•
|
changes in financial market conditions, either internationally, nationally or locally in areas in which the Company, the Bank, and MVB Mortgage conduct operations, including without limitation, reduced rates of business formation and growth, commercial and residential real estate development and real estate prices;
|
•
|
fluctuations in markets for equity, fixed-income, commercial paper and other securities, including availability, market liquidity levels, and pricing; changes in interest rates, the quality and composition of the loan and securities portfolios, demand for loan products, deposit flows and competition;
|
•
|
the ability of the Company, the Bank, and MVB Mortgage to successfully conduct acquisitions and integrate acquired businesses;
|
•
|
potential difficulties in expanding the businesses of the Company, the Bank, and MVB Mortgage in existing and new markets;
|
•
|
increases in the levels of losses, customer bankruptcies, bank failures, claims, and assessments;
|
•
|
changes in fiscal, monetary, regulatory, trade and tax policies and laws, including the recently enacted Tax Reform Act, and regulatory assessments and fees, including policies of the U.S. Department of Treasury, the Federal Reserve, and the FDIC;
|
•
|
the impact of executive compensation rules under the Dodd-Frank Act and banking regulations which may impact the ability of the Company and its subsidiaries, and other American financial institutions to retain and recruit executives and other personnel necessary for their businesses and competitiveness;
|
•
|
the impact of the Dodd-Frank Act and of new international standards known as Basel III, and rules and regulations thereunder, many of which have not yet been promulgated, on our required regulatory capital and liquidity levels, governmental assessments on us, the scope of business activities in which we may engage, the manner in which the Company, the Bank, and MVB Mortgage engage in such activities, the fees that the Company’s subsidiaries may charge for certain products and services, and other matters affected by the Dodd-Frank Act and these international standards;
|
•
|
continuing consolidation in the financial services industry; new legal claims against the Company, the Bank, and MVB Mortgage, including litigation, arbitration and proceedings brought by governmental or self-regulatory agencies, or changes in existing legal matters;
|
•
|
success in gaining regulatory approvals, when required, including for proposed mergers or acquisitions;
|
•
|
changes in consumer spending and savings habits;
|
•
|
increased competitive challenges and expanding product and pricing pressures among financial institutions;
|
•
|
inflation and deflation;
|
•
|
technological changes and the implementation of new technologies by the Company and its subsidiaries;
|
•
|
the ability of the Company, the Bank, and MVB Mortgage to develop and maintain secure and reliable information technology systems;
|
•
|
legislation or regulatory changes which adversely affect the operations or business of the Company, the Bank, and MVB Mortgage;
|
•
|
the ability of the Company, the Bank, and MVB Mortgage to comply with applicable laws and regulations; changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board or regulatory agencies;
|
•
|
costs of deposit insurance and changes with respect to FDIC insurance coverage levels; and
|
•
|
other risks and uncertainties detailed in Part I, Item 1A, Risk Factors, in this Annual Report on Form 10-K.
|
(Dollars in thousands)
|
|
Change in Volume
|
|
Change in Rate
|
|
Change in both Rate & Volume
|
|
Total Change
|
||||
Earning Assets
|
|
|
|
|
|
|
|
|
||||
Loans
|
|
|
|
|
|
|
|
|
||||
Commercial
|
|
738
|
|
|
526
|
|
|
12
|
|
|
1,276
|
|
Tax exempt
|
|
(44
|
)
|
|
—
|
|
|
—
|
|
|
(44
|
)
|
Real estate
|
|
(1,057
|
)
|
|
1,148
|
|
|
(73
|
)
|
|
18
|
|
Consumer
|
|
(149
|
)
|
|
66
|
|
|
(12
|
)
|
|
(95
|
)
|
Investment securities:
|
|
|
|
|
|
|
|
|
||||
Taxable
|
|
880
|
|
|
250
|
|
|
162
|
|
|
1,292
|
|
Tax-exempt
|
|
(154
|
)
|
|
179
|
|
|
(15
|
)
|
|
10
|
|
Interest-bearing deposits in banks
|
|
(73
|
)
|
|
130
|
|
|
(99
|
)
|
|
(42
|
)
|
CDs with other banks
|
|
57
|
|
|
2
|
|
|
1
|
|
|
60
|
|
Total earning assets
|
|
198
|
|
|
2,301
|
|
|
(24
|
)
|
|
2,475
|
|
|
|
|
|
|
|
|
|
|
||||
Interest bearing liabilities
|
|
|
|
|
|
|
|
|
||||
NOW
|
|
(86
|
)
|
|
291
|
|
|
(10
|
)
|
|
195
|
|
Money market checking
|
|
595
|
|
|
(65
|
)
|
|
(31
|
)
|
|
499
|
|
Savings
|
|
6
|
|
|
(15
|
)
|
|
(1
|
)
|
|
(10
|
)
|
IRAs
|
|
5
|
|
|
4
|
|
|
—
|
|
|
9
|
|
CDs
|
|
(623
|
)
|
|
570
|
|
|
(94
|
)
|
|
(147
|
)
|
Repurchase agreements and federal funds sold
|
|
(9
|
)
|
|
14
|
|
|
(2
|
)
|
|
3
|
|
FHLB and other borrowings
|
|
(137
|
)
|
|
847
|
|
|
(106
|
)
|
|
604
|
|
Subordinated debt
|
|
—
|
|
|
16
|
|
|
—
|
|
|
16
|
|
Total interest bearing liabilities
|
|
(249
|
)
|
|
1,662
|
|
|
(244
|
)
|
|
1,169
|
|
Total
|
|
447
|
|
|
639
|
|
|
220
|
|
|
1,306
|
|
(Dollars in thousands)
|
|
Change in Volume
|
|
Change in Rate
|
|
Change in both Rate & Volume
|
|
Total Change
|
||||
Earning Assets
|
|
|
|
|
|
|
|
|
||||
Loans
|
|
|
|
|
|
|
|
|
||||
Commercial
|
|
5,064
|
|
|
1,083
|
|
|
209
|
|
|
6,356
|
|
Tax exempt
|
|
(117
|
)
|
|
(10
|
)
|
|
2
|
|
|
(125
|
)
|
Real estate
|
|
2,608
|
|
|
336
|
|
|
64
|
|
|
3,008
|
|
Consumer
|
|
(28
|
)
|
|
41
|
|
|
(1
|
)
|
|
12
|
|
Investment securities:
|
|
|
|
|
|
|
|
|
||||
Taxable
|
|
151
|
|
|
222
|
|
|
35
|
|
|
408
|
|
Tax-exempt
|
|
309
|
|
|
6
|
|
|
1
|
|
|
316
|
|
Interest-bearing deposits in banks
|
|
1
|
|
|
49
|
|
|
1
|
|
|
51
|
|
CDs with other banks
|
|
(11
|
)
|
|
8
|
|
|
—
|
|
|
(3
|
)
|
Total earning assets
|
|
7,977
|
|
|
1,735
|
|
|
311
|
|
|
10,023
|
|
|
|
|
|
|
|
|
|
|
||||
Interest bearing liabilities
|
|
|
|
|
|
|
|
|
||||
NOW
|
|
46
|
|
|
(340
|
)
|
|
(6
|
)
|
|
(300
|
)
|
Money market checking
|
|
596
|
|
|
116
|
|
|
174
|
|
|
886
|
|
Savings
|
|
11
|
|
|
(31
|
)
|
|
(3
|
)
|
|
(23
|
)
|
IRAs
|
|
52
|
|
|
7
|
|
|
3
|
|
|
62
|
|
CDs
|
|
373
|
|
|
446
|
|
|
58
|
|
|
877
|
|
Repurchase agreements and federal funds sold
|
|
1
|
|
|
(12
|
)
|
|
—
|
|
|
(11
|
)
|
FHLB and other borrowings
|
|
85
|
|
|
275
|
|
|
34
|
|
|
394
|
|
Subordinated debt
|
|
—
|
|
|
22
|
|
|
—
|
|
|
22
|
|
Total interest bearing liabilities
|
|
1,164
|
|
|
483
|
|
|
260
|
|
|
1,907
|
|
Total
|
|
6,813
|
|
|
1,252
|
|
|
51
|
|
|
8,116
|
|
|
|
Within one year
|
|
After one year, but within five
|
|
After five years, but within ten
|
|
After ten years
|
|
Total investment securities
|
||||||||||||||||||||||||||
(Dollars in thousands)
|
|
Amortized Cost
|
|
Weighted Avg. Yield
|
|
Amortized Cost
|
|
Weighted Avg. Yield
|
|
Amortized Cost
|
|
Weighted Avg. Yield
|
|
Amortized Cost
|
|
Weighted Avg. Yield
|
|
Amortized Cost
|
|
Fair Value
|
||||||||||||||||
U. S. Agency securities
|
|
$
|
—
|
|
|
—
|
%
|
|
$
|
24,345
|
|
|
1.90
|
%
|
|
$
|
20,940
|
|
|
2.13
|
%
|
|
$
|
36,420
|
|
|
2.18
|
%
|
|
$
|
81,705
|
|
|
$
|
80,945
|
|
U.S. Sponsored Mortgage-backed securities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,251
|
|
|
1.64
|
|
|
52,136
|
|
|
2.12
|
|
|
59,387
|
|
|
58,154
|
|
||||||
Equity and other securities
|
|
—
|
|
|
—
|
|
|
1,910
|
|
|
5.53
|
|
|
8,493
|
|
|
2.72
|
|
|
5,537
|
|
|
2.90
|
|
|
15,940
|
|
|
16,566
|
|
||||||
Municipal securities
|
|
300
|
|
|
2.10
|
|
|
11,142
|
|
|
4.06
|
|
|
2,760
|
|
|
5.94
|
|
|
60,280
|
|
|
0.41
|
|
|
74,482
|
|
|
75,842
|
|
||||||
Total
|
|
$
|
300
|
|
|
2.10
|
%
|
|
$
|
37,397
|
|
|
2.73
|
%
|
|
$
|
39,444
|
|
|
2.44
|
%
|
|
$
|
154,373
|
|
|
1.49
|
%
|
|
$
|
231,514
|
|
|
$
|
231,507
|
|
(Dollars in thousands)
|
|
One Year or Less
|
|
One Through Five Years
|
|
Due After Five Years
|
|
Total
|
||||||||
Commercial and non-residential real estate
|
|
$
|
151,938
|
|
|
$
|
307,994
|
|
|
$
|
323,977
|
|
|
$
|
783,909
|
|
Residential real estate and home equity
|
|
149,877
|
|
|
20,644
|
|
|
138,093
|
|
|
308,614
|
|
||||
Consumer and other
|
|
1,464
|
|
|
3,910
|
|
|
7,409
|
|
|
12,783
|
|
||||
Total Loans
|
|
$
|
303,279
|
|
|
$
|
332,548
|
|
|
$
|
469,479
|
|
|
$
|
1,105,306
|
|
(Dollars in thousands)
|
|
Commercial and Non-Residential Real Estate
|
|
Residential Real Estate and Home Equity
|
|
Consumer and Other
|
|
Total
|
||||||||
Predetermined fixed interest rate
|
|
$
|
358,961
|
|
|
$
|
98,061
|
|
|
$
|
4,981
|
|
|
$
|
462,003
|
|
Floating or adjustable interest rate
|
|
273,010
|
|
|
60,676
|
|
|
6,338
|
|
|
340,024
|
|
||||
Total as of December 31, 2017
|
|
$
|
631,971
|
|
|
$
|
158,737
|
|
|
$
|
11,319
|
|
|
$
|
802,027
|
|
|
|
December 31,
|
|||||||
|
|
2017
|
|
2016
|
|
2015
|
|||
Loans past due more than 30 days to gross loans
|
|
0.89
|
%
|
|
0.73
|
%
|
|
1.83
|
%
|
Loans past due more than 90 days to gross loans
|
|
0.25
|
%
|
|
0.39
|
%
|
|
0.97
|
%
|
(Dollars in thousands)
|
|
Commercial and Non-Residential Real Estate
|
|
Residential Real Estate and Home Equity
|
|
Consumer and Other
|
|
Total
|
||||||||
ALL balance at December 31, 2016
|
|
$
|
7,181
|
|
|
$
|
1,718
|
|
|
$
|
202
|
|
|
$
|
9,101
|
|
Charge-offs
|
|
(1,138
|
)
|
|
(250
|
)
|
|
(109
|
)
|
|
(1,497
|
)
|
||||
Recoveries
|
|
39
|
|
|
44
|
|
|
18
|
|
|
101
|
|
||||
Provision
|
|
1,722
|
|
|
312
|
|
|
139
|
|
|
2,173
|
|
||||
ALL balance at December 31, 2017
|
|
$
|
7,804
|
|
|
$
|
1,824
|
|
|
$
|
250
|
|
|
$
|
9,878
|
|
(Dollars in thousands)
|
|
Commercial and Non-Residential Real Estate
|
|
Residential Real Estate and Home Equity
|
|
Consumer and Other
|
|
Total
|
||||||||
ALL balance at December 31, 2015
|
|
$
|
6,066
|
|
|
$
|
1,810
|
|
|
$
|
130
|
|
|
$
|
8,006
|
|
Charge-offs
|
|
(1,995
|
)
|
|
(224
|
)
|
|
(338
|
)
|
|
(2,557
|
)
|
||||
Recoveries
|
|
8
|
|
|
11
|
|
|
1
|
|
|
20
|
|
||||
Provision
|
|
3,102
|
|
|
121
|
|
|
409
|
|
|
3,632
|
|
||||
ALL balance at December 31, 2016
|
|
$
|
7,181
|
|
|
$
|
1,718
|
|
|
$
|
202
|
|
|
$
|
9,101
|
|
(Dollars in thousands)
|
|
Commercial and Non-Residential Real Estate
|
|
Residential Real Estate and Home Equity
|
|
Consumer and Other
|
|
Total
|
||||||||
ALL balance at December 31, 2014
|
|
$
|
4,363
|
|
|
$
|
1,653
|
|
|
$
|
207
|
|
|
$
|
6,223
|
|
Charge-offs
|
|
(708
|
)
|
|
(33
|
)
|
|
(6
|
)
|
|
(747
|
)
|
||||
Recoveries
|
|
20
|
|
|
6
|
|
|
11
|
|
|
37
|
|
||||
Provision
|
|
2,391
|
|
|
184
|
|
|
(82
|
)
|
|
2,493
|
|
||||
ALL balance at December 31, 2015
|
|
$
|
6,066
|
|
|
$
|
1,810
|
|
|
$
|
130
|
|
|
$
|
8,006
|
|
(Dollars in thousands)
|
|
Commercial and Non-Residential Real Estate
|
|
Residential Real Estate and Home Equity
|
|
Consumer and Other
|
|
Total
|
||||||||
ALL balance at December 31, 2013
|
|
$
|
3,609
|
|
|
$
|
1,073
|
|
|
$
|
253
|
|
|
$
|
4,935
|
|
Charge-offs
|
|
(1,110
|
)
|
|
(130
|
)
|
|
(68
|
)
|
|
(1,308
|
)
|
||||
Recoveries
|
|
7
|
|
|
3
|
|
|
4
|
|
|
14
|
|
||||
Provision
|
|
1,857
|
|
|
707
|
|
|
18
|
|
|
2,582
|
|
||||
ALL balance at December 31, 2014
|
|
$
|
4,363
|
|
|
$
|
1,653
|
|
|
$
|
207
|
|
|
$
|
6,223
|
|
(Dollars in thousands)
|
|
Commercial and Non-Residential Real Estate
|
|
Residential Real Estate and Home Equity
|
|
Consumer and Other
|
|
Total
|
||||||||
ALL balance at December 31, 2012
|
|
$
|
3,107
|
|
|
$
|
756
|
|
|
$
|
213
|
|
|
$
|
4,076
|
|
Charge-offs
|
|
(1,458
|
)
|
|
(38
|
)
|
|
(33
|
)
|
|
(1,529
|
)
|
||||
Recoveries
|
|
57
|
|
|
70
|
|
|
1
|
|
|
128
|
|
||||
Provision
|
|
1,903
|
|
|
285
|
|
|
72
|
|
|
2,260
|
|
||||
ALL balance at December 31, 2013
|
|
$
|
3,609
|
|
|
$
|
1,073
|
|
|
$
|
253
|
|
|
$
|
4,935
|
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|||||||||||||||||||||||||
December 31,
|
|
Amount
|
|
% of loans in each category to total loans
|
|
Amount
|
|
% of loans in each category to total loans
|
|
Amount
|
|
% of loans in each category to total loans
|
|
Amount
|
|
% of loans in each category to total loans
|
|
Amount
|
|
% of loans in each category to total loans
|
|||||||||||||||
Commercial and non-residential real estate
|
|
$
|
7,804
|
|
|
71
|
%
|
|
$
|
7,181
|
|
|
72
|
%
|
|
$
|
6,066
|
|
|
70
|
%
|
|
$
|
4,363
|
|
|
70
|
%
|
|
$
|
3,609
|
|
|
74
|
%
|
Residential real estate and home equity
|
|
1,824
|
|
|
28
|
|
|
1,718
|
|
|
27
|
|
|
1,810
|
|
|
28
|
|
|
1,653
|
|
|
28
|
|
|
1,073
|
|
|
23
|
|
|||||
Consumer and other
|
|
250
|
|
|
1
|
|
|
202
|
|
|
1
|
|
|
130
|
|
|
2
|
|
|
207
|
|
|
2
|
|
|
253
|
|
|
3
|
|
|||||
Total
|
|
$
|
9,878
|
|
|
100
|
%
|
|
$
|
9,101
|
|
|
100
|
%
|
|
$
|
8,006
|
|
|
100
|
%
|
|
$
|
6,223
|
|
|
100
|
%
|
|
$
|
4,935
|
|
|
100
|
%
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Demand deposits of individuals, partnerships, and corporations
|
|
|
|
|
|
|
|
|
|
|||
Noninterest bearing demand
|
|
$
|
125,963
|
|
|
$
|
115,692
|
|
|
$
|
80,423
|
|
Interest bearing demand
|
|
436,303
|
|
|
414,031
|
|
|
473,459
|
|
|||
Savings and money markets
|
|
284,795
|
|
|
280,533
|
|
|
128,622
|
|
|||
Time deposits including CDs and IRAs
|
|
312,519
|
|
|
296,761
|
|
|
329,810
|
|
|||
Total deposits
|
|
$
|
1,159,580
|
|
|
$
|
1,107,017
|
|
|
$
|
1,012,314
|
|
|
|
|
|
|
|
|
||||||
Time deposits that meet or exceed the FDIC insurance limit
|
|
$
|
18,832
|
|
|
$
|
18,727
|
|
|
$
|
21,690
|
|
|
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||
(Dollars in thousands)
|
|
Average Balance
|
|
Average Rate
|
|
Average Balance
|
|
Average Rate
|
|
Average Balance
|
|
Average Rate
|
|||||||||
Noninterest bearing demand deposits
|
|
$
|
117,696
|
|
|
|
|
|
$
|
99,826
|
|
|
|
|
|
$
|
79,611
|
|
|
|
|
Interest-bearing demand deposits:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
NOW
|
|
438,123
|
|
|
0.60
|
%
|
|
454,320
|
|
|
0.53
|
%
|
|
446,704
|
|
|
0.61
|
%
|
|||
Money market checking
|
|
239,632
|
|
|
0.74
|
%
|
|
163,630
|
|
|
0.78
|
%
|
|
65,306
|
|
|
0.61
|
%
|
|||
Savings
|
|
47,034
|
|
|
0.17
|
%
|
|
43,870
|
|
|
0.20
|
%
|
|
39,766
|
|
|
0.28
|
%
|
|||
IRAs
|
|
16,678
|
|
|
1.30
|
%
|
|
16,319
|
|
|
1.27
|
%
|
|
12,038
|
|
|
1.21
|
%
|
|||
CDs
|
|
262,417
|
|
|
1.38
|
%
|
|
314,542
|
|
|
1.19
|
%
|
|
278,499
|
|
|
1.03
|
%
|
|||
Total interest-bearing deposits
|
|
1,003,884
|
|
|
0.83
|
%
|
|
992,681
|
|
|
0.78
|
%
|
|
842,313
|
|
|
0.74
|
%
|
|||
Total deposits
|
|
$
|
1,121,580
|
|
|
|
|
$
|
1,092,507
|
|
|
|
|
$
|
921,924
|
|
|
|
Short-term borrowings:
|
||||||||||||
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Balance at end of year
|
|
$
|
149,596
|
|
|
$
|
87,733
|
|
|
$
|
179,917
|
|
Average balance during the year
|
|
100,969
|
|
|
137,822
|
|
|
121,425
|
|
|||
Maximum month-end balance
|
|
220,097
|
|
|
210,600
|
|
|
179,917
|
|
|||
Weighted-average rate during the year
|
|
1.16
|
%
|
|
0.51
|
%
|
|
0.34
|
%
|
|||
Weighted-average rate at December 31
|
|
1.61
|
%
|
|
0.74
|
%
|
|
0.44
|
%
|
Repurchase agreements:
|
||||||||||||
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Balance at end of year
|
|
$
|
22,403
|
|
|
$
|
25,160
|
|
|
$
|
27,437
|
|
Average balance during the year
|
|
25,160
|
|
|
27,066
|
|
|
26,884
|
|
|||
Maximum month-end balance
|
|
25,972
|
|
|
29,561
|
|
|
32,470
|
|
|||
Weighted-average rate during the year
|
|
0.30
|
%
|
|
0.27
|
%
|
|
0.31
|
%
|
|||
Weighted-average rate at December 31
|
|
0.34
|
%
|
|
0.28
|
%
|
|
0.30
|
%
|
(Dollars in thousands)
|
|
Less than one year
|
|
One to three years
|
|
Three to five years
|
|
More than five years
|
|
Total
|
||||||||||
Certificates of deposit and individual retirement accounts
1
|
|
$
|
169,220
|
|
|
$
|
98,012
|
|
|
$
|
45,287
|
|
|
$
|
—
|
|
|
$
|
312,519
|
|
Securities sold under agreement to repurchase
|
|
22,403
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
22,403
|
|
|||||
Operating leases
|
|
1,822
|
|
|
2,543
|
|
|
2,469
|
|
|
5,185
|
|
|
12,019
|
|
|||||
FHLB short-term advances
|
|
149,596
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
149,596
|
|
|||||
FHLB long-term advances
|
|
81
|
|
|
175
|
|
|
2,317
|
|
|
—
|
|
|
2,573
|
|
|||||
Total
|
|
$
|
343,122
|
|
|
$
|
100,730
|
|
|
$
|
50,073
|
|
|
$
|
5,185
|
|
|
$
|
499,110
|
|
|
2017
|
|
2016
|
||||
ASSETS
|
|
|
|
||||
Cash and cash equivalents:
|
|
|
|
||||
Cash and due from banks
|
$
|
16,345
|
|
|
$
|
14,846
|
|
Interest bearing balances with banks
|
3,960
|
|
|
2,494
|
|
||
Total cash and cash equivalents
|
20,305
|
|
|
17,340
|
|
||
Certificates of deposit with other banks
|
14,778
|
|
|
14,527
|
|
||
Investment Securities:
|
|
|
|
||||
Securities available-for-sale
|
231,507
|
|
|
162,368
|
|
||
Loans held for sale
|
66,794
|
|
|
90,174
|
|
||
Loans receivable:
|
1,105,941
|
|
|
1,052,865
|
|
||
Less: Allowance for loan losses
|
(9,878
|
)
|
|
(9,101
|
)
|
||
Net Loans
|
1,096,063
|
|
|
1,043,764
|
|
||
Premises and equipment
|
26,686
|
|
|
25,081
|
|
||
Bank owned life insurance
|
32,666
|
|
|
22,970
|
|
||
Accrued interest receivable and other assets
|
27,023
|
|
|
24,100
|
|
||
Goodwill
|
18,480
|
|
|
18,480
|
|
||
TOTAL ASSETS
|
$
|
1,534,302
|
|
|
$
|
1,418,804
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Deposits:
|
|
|
|
||||
Noninterest bearing
|
$
|
125,963
|
|
|
$
|
115,692
|
|
Interest bearing
|
1,033,617
|
|
|
991,325
|
|
||
Total deposits
|
1,159,580
|
|
|
1,107,017
|
|
||
|
|
|
|
||||
Accrued interest payable and other liabilities
|
16,434
|
|
|
16,557
|
|
||
Repurchase agreements
|
22,403
|
|
|
25,160
|
|
||
FHLB and other borrowings
|
152,169
|
|
|
90,921
|
|
||
Subordinated debt
|
33,524
|
|
|
33,524
|
|
||
Total liabilities
|
1,384,110
|
|
|
1,273,179
|
|
||
|
|
|
|
||||
STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Preferred stock, par value $1,000; 20,000 authorized; 783 and 9,283 issued in 2017 and 2016, respectively (See Footnote 12)
|
7,834
|
|
|
16,334
|
|
||
Common stock, par value $1; 20,000,000 shares authorized; 10,495,704 issued and 10,444,627 shares outstanding in 2017; 10,047,621 shares issued and 9,996,544 shares outstanding in 2016
|
10,496
|
|
|
10,048
|
|
||
Additional paid-in capital
|
98,698
|
|
|
93,412
|
|
||
Retained earnings
|
37,236
|
|
|
31,192
|
|
||
Accumulated other comprehensive loss
|
(2,988
|
)
|
|
(4,277
|
)
|
||
Treasury Stock, 51,077 shares, at cost
|
(1,084
|
)
|
|
(1,084
|
)
|
||
Total stockholders’ equity
|
150,192
|
|
|
145,625
|
|
||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
|
$
|
1,534,302
|
|
|
$
|
1,418,804
|
|
|
2017
|
|
2016
|
|
2015
|
||||||
INTEREST INCOME
|
|
|
|
|
|
||||||
Interest and fees on loans
|
$
|
51,217
|
|
|
$
|
50,018
|
|
|
$
|
40,642
|
|
Interest on deposits with other banks
|
340
|
|
|
322
|
|
|
274
|
|
|||
Interest on investment securities - taxable
|
2,658
|
|
|
1,366
|
|
|
958
|
|
|||
Interest on tax exempt loans and securities
|
2,383
|
|
|
2,417
|
|
|
2,226
|
|
|||
Total interest income
|
56,598
|
|
|
54,123
|
|
|
44,100
|
|
|||
|
|
|
|
|
|
||||||
INTEREST EXPENSE
|
|
|
|
|
|
||||||
Interest on deposits
|
8,294
|
|
|
7,748
|
|
|
6,246
|
|
|||
Interest on repurchase agreements
|
75
|
|
|
72
|
|
|
83
|
|
|||
Interest on FHLB and other borrowings
|
1,690
|
|
|
1,086
|
|
|
692
|
|
|||
Interest on subordinated debt
|
2,242
|
|
|
2,226
|
|
|
2,204
|
|
|||
Total interest expense
|
12,301
|
|
|
11,132
|
|
|
9,225
|
|
|||
|
|
|
|
|
|
||||||
NET INTEREST INCOME
|
44,297
|
|
|
42,991
|
|
|
34,875
|
|
|||
Provision for loan losses
|
2,173
|
|
|
3,632
|
|
|
2,493
|
|
|||
Net interest income after provision for loan losses
|
42,124
|
|
|
39,359
|
|
|
32,382
|
|
|||
|
|
|
|
|
|
||||||
NONINTEREST INCOME
|
|
|
|
|
|
||||||
Service charges on deposit accounts
|
765
|
|
|
764
|
|
|
646
|
|
|||
Income on bank owned life insurance
|
646
|
|
|
638
|
|
|
653
|
|
|||
Visa debit card and interchange income
|
1,258
|
|
|
1,185
|
|
|
987
|
|
|||
Mortgage fee income
|
37,149
|
|
|
35,673
|
|
|
29,472
|
|
|||
Gain on sale of portfolio loans
|
538
|
|
|
1,042
|
|
|
1,413
|
|
|||
Insurance and investment services income
|
563
|
|
|
420
|
|
|
338
|
|
|||
Gain on sale of securities
|
731
|
|
|
1,082
|
|
|
130
|
|
|||
Gain (loss) on derivatives
|
(2,722
|
)
|
|
1,467
|
|
|
675
|
|
|||
Commercial swap fee income
|
503
|
|
|
84
|
|
|
382
|
|
|||
Other operating income
|
1,275
|
|
|
850
|
|
|
259
|
|
|||
Total noninterest income
|
40,706
|
|
|
43,205
|
|
|
34,955
|
|
|||
|
|
|
|
|
|
||||||
NONINTEREST EXPENSES
|
|
|
|
|
|
||||||
Salary and employee benefits
|
44,108
|
|
|
45,225
|
|
|
36,073
|
|
|||
Occupancy expense
|
4,084
|
|
|
3,686
|
|
|
3,390
|
|
|||
Equipment depreciation and maintenance
|
3,005
|
|
|
2,452
|
|
|
2,013
|
|
|||
Data processing and communications
|
5,116
|
|
|
4,964
|
|
|
4,010
|
|
|||
Mortgage processing
|
3,207
|
|
|
3,355
|
|
|
3,158
|
|
|||
Marketing, contributions and sponsorships
|
1,179
|
|
|
1,253
|
|
|
1,352
|
|
|||
Professional fees
|
3,143
|
|
|
2,720
|
|
|
3,232
|
|
|||
Printing, postage and supplies
|
988
|
|
|
767
|
|
|
762
|
|
|||
Insurance, tax and assessment expense
|
1,797
|
|
|
1,528
|
|
|
1,394
|
|
|||
Travel, entertainment, dues and subscriptions
|
2,221
|
|
|
1,725
|
|
|
1,579
|
|
|||
Other operating expenses
|
1,652
|
|
|
1,534
|
|
|
885
|
|
|||
Total noninterest expense
|
70,500
|
|
|
69,209
|
|
|
57,848
|
|
|||
Income from continuing operations, before income taxes
|
12,330
|
|
|
13,355
|
|
|
9,489
|
|
|||
Income tax expense - continuing operations
|
4,755
|
|
|
4,378
|
|
|
2,886
|
|
|||
Net Income from continuing operations
|
7,575
|
|
|
8,977
|
|
|
6,603
|
|
|||
Income from discontinued operations, before income taxes
|
—
|
|
|
6,346
|
|
|
353
|
|
|||
Income tax expense - discontinued operations
|
—
|
|
|
2,411
|
|
|
140
|
|
|||
Net Income from discontinued operations
|
—
|
|
|
3,935
|
|
|
213
|
|
|||
Net Income
|
$
|
7,575
|
|
|
$
|
12,912
|
|
|
$
|
6,816
|
|
Preferred dividends
|
498
|
|
|
1,128
|
|
|
575
|
|
|||
Net Income available to common shareholders
|
$
|
7,077
|
|
|
$
|
11,784
|
|
|
$
|
6,241
|
|
|
|
|
|
|
|
Earnings per share from continuing operations - basic
|
$
|
0.69
|
|
|
$
|
0.96
|
|
|
$
|
0.75
|
|
Earnings per share from discontinued operations - basic
|
$
|
—
|
|
|
$
|
0.48
|
|
|
$
|
0.03
|
|
Earnings per common shareholder - basic
|
$
|
0.69
|
|
|
$
|
1.44
|
|
|
$
|
0.78
|
|
|
|
|
|
|
|
||||||
Earnings per share from continuing operations - diluted
|
$
|
0.68
|
|
|
$
|
0.92
|
|
|
$
|
0.74
|
|
Earnings per share from discontinued operations - diluted
|
$
|
—
|
|
|
$
|
0.39
|
|
|
$
|
0.03
|
|
Earnings per common shareholder - diluted
|
$
|
0.68
|
|
|
$
|
1.31
|
|
|
$
|
0.77
|
|
|
|
|
|
|
|
||||||
Cash dividends declared
|
$
|
0.10
|
|
|
$
|
0.08
|
|
|
$
|
0.08
|
|
Weighted average shares outstanding - basic
|
10,308,738
|
|
|
8,212,021
|
|
|
8,014,316
|
|
|||
Weighted average shares outstanding - diluted
|
10,440,228
|
|
|
10,068,733
|
|
|
8,140,116
|
|
|
2017
|
|
2016
|
|
2015
|
||||||
Net Income
|
$
|
7,575
|
|
|
$
|
12,912
|
|
|
$
|
6,816
|
|
|
|
|
|
|
|
||||||
Other comprehensive income (loss):
|
|
|
|
|
|
||||||
|
|
|
|
|
|
||||||
Unrealized holding gains (losses) on securities available-for-sale
|
3,387
|
|
|
(2,802
|
)
|
|
202
|
|
|||
|
|
|
|
|
|
||||||
Unrealized holding gains during the year related to reclassified held-to-maturity securities
|
—
|
|
|
1,825
|
|
|
—
|
|
|||
|
|
|
|
|
|
||||||
Income tax effect
|
(1,355
|
)
|
|
391
|
|
|
(81
|
)
|
|||
|
|
|
|
|
|
||||||
Reclassification adjustment for gain recognized in income
|
(731
|
)
|
|
(813
|
)
|
|
(130
|
)
|
|||
|
|
|
|
|
|
||||||
Reclassification adjustment for gain recognized in income related to reclassified held-to-maturity securities
|
—
|
|
|
(269
|
)
|
|
—
|
|
|||
|
|
|
|
|
|
||||||
Income tax effect
|
292
|
|
|
433
|
|
|
52
|
|
|||
|
|
|
|
|
|
||||||
Change in defined benefit pension plan
|
(507
|
)
|
|
(181
|
)
|
|
(556
|
)
|
|||
|
|
|
|
|
|
||||||
Income tax effect
|
203
|
|
|
72
|
|
|
222
|
|
|||
|
|
|
|
|
|
||||||
Total other comprehensive income (loss)
|
1,289
|
|
|
(1,344
|
)
|
|
(291
|
)
|
|||
|
|
|
|
|
|
||||||
Comprehensive income
|
$
|
8,864
|
|
|
$
|
11,568
|
|
|
$
|
6,525
|
|
|
Preferred Stock
|
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Retained Earnings
|
|
Accumulated Other Comprehensive (Loss)
|
|
Treasury Stock
|
|
Total Stockholders' Equity
|
||||||||||||||
Balance December 31, 2014
|
$
|
16,334
|
|
|
$
|
8,034
|
|
|
$
|
74,342
|
|
|
$
|
14,454
|
|
|
$
|
(2,642
|
)
|
|
$
|
(1,084
|
)
|
|
$
|
109,438
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net Income
|
—
|
|
|
—
|
|
|
—
|
|
|
6,816
|
|
|
—
|
|
|
—
|
|
|
6,816
|
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(291
|
)
|
|
—
|
|
|
(291
|
)
|
|||||||
Cash dividends paid ($0.08 per share)
|
—
|
|
|
—
|
|
|
—
|
|
|
(641
|
)
|
|
—
|
|
|
—
|
|
|
(641
|
)
|
|||||||
Dividends on preferred stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(575
|
)
|
|
—
|
|
|
—
|
|
|
(575
|
)
|
|||||||
Stock based compensation
|
—
|
|
|
—
|
|
|
413
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
413
|
|
|||||||
Common stock options exercised
|
—
|
|
|
79
|
|
|
(527
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(448
|
)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance December 31, 2015
|
16,334
|
|
|
8,113
|
|
|
74,228
|
|
|
20,054
|
|
|
(2,933
|
)
|
|
(1,084
|
)
|
|
114,712
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net Income
|
—
|
|
|
—
|
|
|
—
|
|
|
12,912
|
|
|
—
|
|
|
—
|
|
|
12,912
|
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,344
|
)
|
|
—
|
|
|
(1,344
|
)
|
|||||||
Cash dividends paid ($0.08 per share)
|
—
|
|
|
—
|
|
|
—
|
|
|
(646
|
)
|
|
—
|
|
|
—
|
|
|
(646
|
)
|
|||||||
Dividends on preferred stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,128
|
)
|
|
—
|
|
|
—
|
|
|
(1,128
|
)
|
|||||||
Common stock issuance, net of issuance costs
|
—
|
|
|
1,913
|
|
|
18,606
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20,519
|
|
|||||||
Stock based compensation
|
—
|
|
|
—
|
|
|
568
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
568
|
|
|||||||
Common stock options exercised
|
—
|
|
|
22
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
32
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance December 31, 2016
|
16,334
|
|
|
10,048
|
|
|
93,412
|
|
|
31,192
|
|
|
(4,277
|
)
|
|
(1,084
|
)
|
|
145,625
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net Income
|
—
|
|
|
—
|
|
|
—
|
|
|
7,575
|
|
|
—
|
|
|
—
|
|
|
7,575
|
|
|||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,289
|
|
|
—
|
|
|
1,289
|
|
|||||||
Cash dividends paid ($0.10 per share)
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,033
|
)
|
|
—
|
|
|
—
|
|
|
(1,033
|
)
|
|||||||
Dividends on preferred stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(498
|
)
|
|
—
|
|
|
—
|
|
|
(498
|
)
|
|||||||
Redemption of preferred stock
|
(8,500
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,500
|
)
|
|||||||
Common stock issuance, net of issuance costs
|
—
|
|
|
444
|
|
|
4,487
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,931
|
|
|||||||
Stock based compensation
|
—
|
|
|
—
|
|
|
813
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
813
|
|
|||||||
Common stock options exercised
|
—
|
|
|
4
|
|
|
(14
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance December 31, 2017
|
$
|
7,834
|
|
|
$
|
10,496
|
|
|
98,698
|
|
|
37,236
|
|
|
$
|
(2,988
|
)
|
|
$
|
(1,084
|
)
|
|
$
|
150,192
|
|
|
2017
|
|
2016
|
|
2015
|
||||||
OPERATING ACTIVITIES
|
|
|
|
|
|
||||||
Net Income
|
$
|
7,575
|
|
|
$
|
12,912
|
|
|
$
|
6,816
|
|
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
|
|
|
|
|
|
||||||
Net amortization and accretion of investments
|
1,166
|
|
|
1,001
|
|
|
765
|
|
|||
Net amortization of deferred loan fees
|
26
|
|
|
55
|
|
|
203
|
|
|||
Provision for loan losses
|
2,173
|
|
|
3,632
|
|
|
2,493
|
|
|||
Depreciation and amortization
|
2,691
|
|
|
3,407
|
|
|
2,908
|
|
|||
Stock based compensation
|
813
|
|
|
568
|
|
|
413
|
|
|||
Loans originated for sale
|
(1,367,531
|
)
|
|
(1,643,450
|
)
|
|
(1,341,965
|
)
|
|||
Proceeds of loans sold
|
1,428,060
|
|
|
1,691,572
|
|
|
1,338,341
|
|
|||
Mortgage fee income
|
(37,149
|
)
|
|
(35,673
|
)
|
|
(29,472
|
)
|
|||
Gain on sale of securities
|
(1,103
|
)
|
|
(1,084
|
)
|
|
(130
|
)
|
|||
Loss on sale of securities
|
372
|
|
|
2
|
|
|
—
|
|
|||
Gain on sale of portfolio loans
|
(538
|
)
|
|
(1,042
|
)
|
|
(1,413
|
)
|
|||
Gain on sale of subsidiary
|
—
|
|
|
(6,926
|
)
|
|
—
|
|
|||
Income on bank owned life insurance
|
(646
|
)
|
|
(638
|
)
|
|
(653
|
)
|
|||
Deferred taxes
|
1,349
|
|
|
707
|
|
|
(395
|
)
|
|||
Other, net
|
(4,137
|
)
|
|
221
|
|
|
(812
|
)
|
|||
Net cash (used in) / provided by operating activities
|
33,121
|
|
|
25,264
|
|
|
(22,901
|
)
|
|||
INVESTING ACTIVITIES
|
|
|
|
|
|
||||||
Purchases of investment securities available-for-sale
|
(139,127
|
)
|
|
(114,612
|
)
|
|
(39,552
|
)
|
|||
Purchases of investment securities held-to-maturity
|
—
|
|
|
—
|
|
|
(700
|
)
|
|||
Maturities/paydowns of investment securities available-for-sale
|
19,011
|
|
|
17,790
|
|
|
24,412
|
|
|||
Maturities/paydowns of investment securities held-to-maturity
|
—
|
|
|
400
|
|
|
1,580
|
|
|||
Sales of investment securities available-for-sale
|
53,198
|
|
|
55,191
|
|
|
12,912
|
|
|||
Sales of investment securities held-to-maturity
|
—
|
|
|
—
|
|
|
421
|
|
|||
Purchases of premises and equipment
|
(4,496
|
)
|
|
(1,668
|
)
|
|
(2,153
|
)
|
|||
Disposals of premises and equipment
|
307
|
|
|
—
|
|
|
—
|
|
|||
Disposals of premises and equipment from sale of subsidiary
|
—
|
|
|
581
|
|
|
—
|
|
|||
Net increase in loans
|
(53,960
|
)
|
|
(22,245
|
)
|
|
(215,173
|
)
|
|||
Purchases of restricted bank stock
|
(20,712
|
)
|
|
(23,933
|
)
|
|
(24,344
|
)
|
|||
Redemptions of restricted bank stock
|
18,980
|
|
|
26,684
|
|
|
20,972
|
|
|||
Proceeds from sale of certificates of deposit with banks
|
1,978
|
|
|
6,717
|
|
|
248
|
|
|||
Purchases of certificates of deposit with banks
|
(2,229
|
)
|
|
(8,094
|
)
|
|
(1,491
|
)
|
|||
Proceeds from sale of other real estate owned
|
—
|
|
|
159
|
|
|
1,132
|
|
|||
Proceeds from sale of subsidiary
|
—
|
|
|
7,047
|
|
|
—
|
|
|||
Branch acquisition, net cash acquired
|
—
|
|
|
—
|
|
|
48,292
|
|
|||
Purchase of bank owned life insurance
|
(9,050
|
)
|
|
—
|
|
|
—
|
|
|||
Net cash (used in) investing activities
|
(136,100
|
)
|
|
(55,983
|
)
|
|
(173,444
|
)
|
|||
FINANCING ACTIVITIES
|
|
|
|
|
|
||||||
Net increase in deposits
|
52,563
|
|
|
94,703
|
|
|
120,390
|
|
|||
Net (decrease) in repurchase agreements
|
(2,757
|
)
|
|
(2,277
|
)
|
|
(5,236
|
)
|
|||
Net change in short-term FHLB borrowings
|
49,663
|
|
|
(92,184
|
)
|
|
84,088
|
|
|||
Principal payments on FHLB borrowings
|
(15,097
|
)
|
|
(93
|
)
|
|
(2,177
|
)
|
|||
Proceeds from new FHLB borrowings
|
26,682
|
|
|
—
|
|
|
—
|
|
|||
Proceeds from stock offering, net of issuance costs
|
4,931
|
|
|
20,519
|
|
|
—
|
|
|||
Preferred stock redemption
|
(8,500
|
)
|
|
—
|
|
|
—
|
|
|||
Common stock options exercised
|
(10
|
)
|
|
32
|
|
|
(448
|
)
|
|||
Cash dividends paid on common stock
|
(1,033
|
)
|
|
(646
|
)
|
|
(641
|
)
|
|||
Cash dividends paid on preferred stock
|
(498
|
)
|
|
(1,128
|
)
|
|
(575
|
)
|
|||
Net cash provided by financing activities
|
105,944
|
|
|
18,926
|
|
|
195,401
|
|
|||
Increase (decrease) in cash and cash equivalents
|
2,965
|
|
|
(11,793
|
)
|
|
(944
|
)
|
|||
Cash and cash equivalents at beginning of period
|
17,340
|
|
|
29,133
|
|
|
30,077
|
|
|||
Cash and cash equivalents at end of period
|
$
|
20,305
|
|
|
$
|
17,340
|
|
|
$
|
29,133
|
|
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
||||||
Loans transferred to other real estate owned
|
$
|
1,164
|
|
|
$
|
332
|
|
|
$
|
174
|
|
Cashless stock options exercised
|
$
|
4
|
|
|
$
|
16
|
|
|
$
|
1,180
|
|
Cash payments for:
|
|
|
|
|
|
||||||
Interest on deposits, repurchase agreements and borrowings
|
$
|
12,399
|
|
|
$
|
10,890
|
|
|
$
|
11,124
|
|
Income taxes
|
$
|
6,026
|
|
|
$
|
6,922
|
|
|
$
|
2,400
|
|
•
|
Lending policies and procedures
|
•
|
Nature and volume of the portfolio
|
•
|
Experience and ability of lending management and staff
|
•
|
Volume and severity of problem credits
|
•
|
Conclusions of loan reviews, audits and exams
|
•
|
National, state, regional and local economic trends and business conditions
|
◦
|
General economic conditions
|
◦
|
Unemployment rates
|
◦
|
Inflation / CPI
|
•
|
Value of underlying collateral
|
•
|
Existence and effect of any credit concentrations
|
•
|
Consumer sentiment
|
•
|
Other external factors
|
|
|
For the years ended
|
||||||||||
|
|
December 31,
|
||||||||||
(Dollars in thousands except shares and per share data)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Numerator for basic earnings per share:
|
|
|
|
|
|
|
||||||
Net Income from continuing operations
|
|
$
|
7,575
|
|
|
$
|
8,977
|
|
|
$
|
6,603
|
|
Less: Dividends on preferred stock
|
|
498
|
|
|
1,128
|
|
|
575
|
|
|||
Net Income from continuing operations available to common shareholders - basic
|
|
7,077
|
|
|
7,849
|
|
|
6,028
|
|
|||
Net Income from discontinued operations available to common shareholders - basic and diluted
|
|
—
|
|
|
3,935
|
|
|
213
|
|
|||
Net Income available to common shareholders
|
|
$
|
7,077
|
|
|
$
|
11,784
|
|
|
$
|
6,241
|
|
|
|
|
|
|
|
|
||||||
Numerator for diluted earnings per share:
|
|
|
|
|
|
|
||||||
Net Income from continuing operations available to common shareholders - basic
|
|
$
|
7,077
|
|
|
$
|
7,849
|
|
|
$
|
6,028
|
|
Add: Dividends on preferred stock
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Add: Interest on subordinated debt (tax effected)
|
|
—
|
|
|
1,390
|
|
|
—
|
|
|||
Net Income available to common shareholders from continuing operations - diluted
|
|
$
|
7,077
|
|
|
$
|
9,239
|
|
|
$
|
6,028
|
|
|
|
|
|
|
|
|
||||||
Denominator:
|
|
|
|
|
|
|
||||||
Total average shares outstanding
|
|
10,308,738
|
|
|
8,212,021
|
|
|
8,014,316
|
|
|||
Effect of dilutive convertible preferred stock
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Effect of dilutive convertible subordinated debt
|
|
—
|
|
|
1,837,500
|
|
|
—
|
|
|||
Effect of dilutive stock options
|
|
131,490
|
|
|
19,212
|
|
|
125,800
|
|
|||
Total diluted average shares outstanding
|
|
10,440,228
|
|
|
10,068,733
|
|
|
8,140,116
|
|
|||
|
|
|
|
|
|
|
||||||
Earnings per share from continuing operations - basic
|
|
$
|
0.69
|
|
|
$
|
0.96
|
|
|
$
|
0.75
|
|
Earnings per share from discontinued operations - basic
|
|
$
|
—
|
|
|
$
|
0.48
|
|
|
$
|
0.03
|
|
Earnings per common shareholder - basic
|
|
$
|
0.69
|
|
|
$
|
1.44
|
|
|
$
|
0.78
|
|
|
|
|
|
|
|
|
||||||
Earnings per share from continuing operations - diluted
|
|
$
|
0.68
|
|
|
$
|
0.92
|
|
|
$
|
0.74
|
|
Earnings per share from discontinued operations - diluted
|
|
$
|
—
|
|
|
$
|
0.39
|
|
|
$
|
0.03
|
|
Earnings per common shareholder - diluted
|
|
$
|
0.68
|
|
|
$
|
1.31
|
|
|
$
|
0.77
|
|
(Dollars in thousands)
|
|
Amortized Cost
|
|
Unrealized Gain
|
|
Unrealized Loss
|
|
Fair Value
|
||||||||
U. S. Agency securities
|
|
$
|
81,705
|
|
|
$
|
81
|
|
|
$
|
(841
|
)
|
|
$
|
80,945
|
|
U.S. Sponsored Mortgage-backed securities
|
|
59,387
|
|
|
31
|
|
|
(1,264
|
)
|
|
58,154
|
|
||||
Municipal securities
|
|
74,482
|
|
|
1,733
|
|
|
(373
|
)
|
|
75,842
|
|
||||
Total debt securities
|
|
215,574
|
|
|
1,845
|
|
|
(2,478
|
)
|
|
214,941
|
|
||||
Equity and other securities
|
|
15,940
|
|
|
644
|
|
|
(18
|
)
|
|
16,566
|
|
||||
Total investment securities available-for-sale
|
|
$
|
231,514
|
|
|
$
|
2,489
|
|
|
$
|
(2,496
|
)
|
|
$
|
231,507
|
|
(Dollars in thousands)
|
|
Amortized Cost
|
|
Unrealized Gain
|
|
Unrealized Loss
|
|
Fair Value
|
||||||||
U. S. Agency securities
|
|
$
|
29,234
|
|
|
$
|
7
|
|
|
$
|
(425
|
)
|
|
$
|
28,816
|
|
U.S. Sponsored Mortgage-backed securities
|
|
56,080
|
|
|
14
|
|
|
(1,362
|
)
|
|
54,732
|
|
||||
Municipal securities
|
|
72,075
|
|
|
744
|
|
|
(2,023
|
)
|
|
70,796
|
|
||||
Total debt securities
|
|
157,389
|
|
|
765
|
|
|
(3,810
|
)
|
|
154,344
|
|
||||
Equity and other securities
|
|
7,643
|
|
|
381
|
|
|
—
|
|
|
8,024
|
|
||||
Total investment securities available-for-sale
|
|
$
|
165,032
|
|
|
$
|
1,146
|
|
|
$
|
(3,810
|
)
|
|
$
|
162,368
|
|
(Dollars in thousands)
|
|
Less than 12 months
|
|
12 months or more
|
||||||||||||
Description and number of positions
|
|
Fair Value
|
|
Unrealized Loss
|
|
Fair Value
|
|
Unrealized Loss
|
||||||||
U.S. Agency securities (45)
|
|
$
|
61,834
|
|
|
$
|
(659
|
)
|
|
$
|
7,709
|
|
|
$
|
(182
|
)
|
U.S. Sponsored Mortgage-backed securities (39)
|
|
16,825
|
|
|
(159
|
)
|
|
37,427
|
|
|
(1,105
|
)
|
||||
Municipal securities (47)
|
|
8,826
|
|
|
(48
|
)
|
|
16,781
|
|
|
(325
|
)
|
||||
Equity and other securities (2)
|
|
$
|
1,034
|
|
|
$
|
(18
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
$
|
88,519
|
|
|
$
|
(884
|
)
|
|
$
|
61,917
|
|
|
$
|
(1,612
|
)
|
(Dollars in thousands)
|
|
Less than 12 months
|
|
12 months or more
|
||||||||||||
Description and number of positions
|
|
Fair Value
|
|
Unrealized Loss
|
|
Fair Value
|
|
Unrealized Loss
|
||||||||
U.S. Agency securities (16)
|
|
$
|
28,814
|
|
|
$
|
(425
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
U.S. Sponsored Mortgage-backed securities (29)
|
|
33,209
|
|
|
(1,040
|
)
|
|
13,919
|
|
|
(322
|
)
|
||||
Municipal securities (86)
|
|
42,727
|
|
|
(2,023
|
)
|
|
—
|
|
|
—
|
|
||||
|
|
$
|
104,750
|
|
|
$
|
(3,488
|
)
|
|
$
|
13,919
|
|
|
$
|
(322
|
)
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
||||
Commercial and Non-Residential Real Estate
|
|
$
|
783,909
|
|
|
$
|
756,619
|
|
Residential Real Estate
|
|
246,214
|
|
|
215,452
|
|
||
Home Equity
|
|
62,400
|
|
|
65,386
|
|
||
Consumer
|
|
12,783
|
|
|
14,511
|
|
||
Total Loans
|
|
1,105,306
|
|
|
1,051,968
|
|
||
Deferred loan origination fees and costs, net
|
|
635
|
|
|
897
|
|
||
Loans receivable
|
|
$
|
1,105,941
|
|
|
$
|
1,052,865
|
|
(Dollars in thousands)
|
|
Commercial
|
|
Residential
|
|
Home Equity
|
|
Consumer
|
|
Total
|
||||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Individually evaluated for impairment
|
|
$
|
13,796
|
|
|
$
|
1,569
|
|
|
$
|
13
|
|
|
$
|
178
|
|
|
$
|
15,556
|
|
Collectively evaluated for impairment
|
|
770,113
|
|
|
244,645
|
|
|
62,387
|
|
|
12,605
|
|
|
1,089,750
|
|
|||||
Total Loans
|
|
$
|
783,909
|
|
|
$
|
246,214
|
|
|
$
|
62,400
|
|
|
$
|
12,783
|
|
|
$
|
1,105,306
|
|
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Individually evaluated for impairment
|
|
$
|
10,781
|
|
|
$
|
1,161
|
|
|
$
|
132
|
|
|
$
|
78
|
|
|
$
|
12,152
|
|
Collectively evaluated for impairment
|
|
745,838
|
|
|
214,291
|
|
|
65,254
|
|
|
14,433
|
|
|
1,039,816
|
|
|||||
Total Loans
|
|
$
|
756,619
|
|
|
$
|
215,452
|
|
|
$
|
65,386
|
|
|
$
|
14,511
|
|
|
$
|
1,051,968
|
|
|
|
Impaired Loans with Specific Allowance
|
|
Impaired Loans with No Specific Allowance
|
|
Total Impaired Loans
|
||||||||||||||
(Dollars in thousands)
|
|
Recorded Investment
|
|
Related Allowance
|
|
Recorded Investment
|
|
Recorded Investment
|
|
Unpaid Principal Balance
|
||||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial Business
|
|
$
|
3,283
|
|
|
$
|
22
|
|
|
$
|
979
|
|
|
$
|
4,262
|
|
|
$
|
4,275
|
|
Commercial Real Estate
|
|
4,603
|
|
|
1,150
|
|
|
2,814
|
|
|
7,417
|
|
|
7,921
|
|
|||||
Acquisition & Development
|
|
—
|
|
|
—
|
|
|
2,117
|
|
|
2,117
|
|
|
4,090
|
|
|||||
Total Commercial
|
|
7,886
|
|
|
1,172
|
|
|
5,910
|
|
|
13,796
|
|
|
16,286
|
|
|||||
Residential
|
|
—
|
|
|
—
|
|
|
1,569
|
|
|
1,569
|
|
|
1,601
|
|
|||||
Home Equity
|
|
—
|
|
|
—
|
|
|
13
|
|
|
13
|
|
|
13
|
|
|||||
Consumer
|
|
69
|
|
|
16
|
|
|
109
|
|
|
178
|
|
|
475
|
|
|||||
Total Impaired Loans
|
|
$
|
7,955
|
|
|
$
|
1,188
|
|
|
$
|
7,601
|
|
|
$
|
15,556
|
|
|
$
|
18,375
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial Business
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,342
|
|
|
$
|
3,342
|
|
|
$
|
4,102
|
|
Commercial Real Estate
|
|
2,757
|
|
|
302
|
|
|
892
|
|
|
3,649
|
|
|
3,676
|
|
|||||
Acquisition & Development
|
|
264
|
|
|
74
|
|
|
3,526
|
|
|
3,790
|
|
|
6,059
|
|
|||||
Total Commercial
|
|
3,021
|
|
|
376
|
|
|
7,760
|
|
|
10,781
|
|
|
13,837
|
|
|||||
Residential
|
|
783
|
|
|
122
|
|
|
378
|
|
|
1,161
|
|
|
1,166
|
|
|||||
Home Equity
|
|
62
|
|
|
36
|
|
|
70
|
|
|
132
|
|
|
135
|
|
|||||
Consumer
|
|
16
|
|
|
9
|
|
|
62
|
|
|
78
|
|
|
285
|
|
|||||
Total Impaired Loans
|
|
$
|
3,882
|
|
|
$
|
543
|
|
|
$
|
8,270
|
|
|
$
|
12,152
|
|
|
$
|
15,423
|
|
(Dollars in thousands)
|
|
Pass
|
|
Special Mention
|
|
Substandard
|
|
Doubtful
|
|
Total
|
||||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial Business
|
|
$
|
371,041
|
|
|
$
|
4,816
|
|
|
$
|
4,506
|
|
|
$
|
—
|
|
|
$
|
380,363
|
|
Commercial Real Estate
|
|
271,751
|
|
|
22,995
|
|
|
5,961
|
|
|
1,149
|
|
|
301,856
|
|
|||||
Acquisition & Development
|
|
96,712
|
|
|
931
|
|
|
2,230
|
|
|
1,817
|
|
|
101,690
|
|
|||||
Total Commercial
|
|
739,504
|
|
|
28,742
|
|
|
12,697
|
|
|
2,966
|
|
|
783,909
|
|
|||||
Residential
|
|
242,823
|
|
|
3,036
|
|
|
223
|
|
|
132
|
|
|
246,214
|
|
|||||
Home Equity
|
|
61,037
|
|
|
1,311
|
|
|
52
|
|
|
—
|
|
|
62,400
|
|
|||||
Consumer
|
|
12,453
|
|
|
174
|
|
|
25
|
|
|
131
|
|
|
12,783
|
|
|||||
Total Loans
|
|
$
|
1,055,817
|
|
|
$
|
33,263
|
|
|
$
|
12,997
|
|
|
$
|
3,229
|
|
|
$
|
1,105,306
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial Business
|
|
$
|
376,734
|
|
|
$
|
2,933
|
|
|
$
|
6,833
|
|
|
$
|
69
|
|
|
$
|
386,569
|
|
Commercial Real Estate
|
|
240,851
|
|
|
26,340
|
|
|
3,532
|
|
|
737
|
|
|
271,460
|
|
|||||
Acquisition & Development
|
|
90,875
|
|
|
1,905
|
|
|
2,584
|
|
|
3,226
|
|
|
98,590
|
|
|||||
Total Commercial
|
|
708,460
|
|
|
31,178
|
|
|
12,949
|
|
|
4,032
|
|
|
756,619
|
|
|||||
Residential
|
|
212,869
|
|
|
1,664
|
|
|
787
|
|
|
132
|
|
|
215,452
|
|
|||||
Home Equity
|
|
64,706
|
|
|
582
|
|
|
98
|
|
|
—
|
|
|
65,386
|
|
|||||
Consumer
|
|
14,134
|
|
|
302
|
|
|
13
|
|
|
62
|
|
|
14,511
|
|
|||||
Total Loans
|
|
$
|
1,000,169
|
|
|
$
|
33,726
|
|
|
$
|
13,847
|
|
|
$
|
4,226
|
|
|
$
|
1,051,968
|
|
(Dollars in thousands)
|
|
Current
|
|
30-59 Days Past Due
|
|
60-89 Days Past Due
|
|
90+ Days Past Due
|
|
Total Past Due
|
|
Total Loans
|
|
Non-Accrual
|
|
90+ Days Still Accruing
|
||||||||||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Commercial
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Commercial Business
|
|
$
|
377,901
|
|
|
$
|
512
|
|
|
$
|
1,368
|
|
|
$
|
582
|
|
|
$
|
2,462
|
|
|
$
|
380,363
|
|
|
$
|
1,027
|
|
|
$
|
—
|
|
Commercial Real Estate
|
|
300,282
|
|
|
45
|
|
|
1,149
|
|
|
380
|
|
|
1,574
|
|
|
301,856
|
|
|
5,206
|
|
|
—
|
|
||||||||
Acquisition & Development
|
|
99,573
|
|
|
—
|
|
|
874
|
|
|
1,243
|
|
|
2,117
|
|
|
101,690
|
|
|
2,117
|
|
|
—
|
|
||||||||
Total Commercial
|
|
777,756
|
|
|
557
|
|
|
3,391
|
|
|
2,205
|
|
|
6,153
|
|
|
783,909
|
|
|
8,350
|
|
|
—
|
|
||||||||
Residential
|
|
243,177
|
|
|
1,879
|
|
|
707
|
|
|
451
|
|
|
3,037
|
|
|
246,214
|
|
|
1,157
|
|
|
—
|
|
||||||||
Home Equity
|
|
61,907
|
|
|
240
|
|
|
240
|
|
|
13
|
|
|
493
|
|
|
62,400
|
|
|
13
|
|
|
—
|
|
||||||||
Consumer
|
|
12,634
|
|
|
11
|
|
|
—
|
|
|
138
|
|
|
149
|
|
|
12,783
|
|
|
179
|
|
|
—
|
|
||||||||
Total Loans
|
|
$
|
1,095,474
|
|
|
$
|
2,687
|
|
|
$
|
4,338
|
|
|
$
|
2,807
|
|
|
$
|
9,832
|
|
|
$
|
1,105,306
|
|
|
$
|
9,699
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Commercial
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Commercial Business
|
|
$
|
386,311
|
|
|
$
|
15
|
|
|
$
|
169
|
|
|
$
|
74
|
|
|
$
|
258
|
|
|
$
|
386,569
|
|
|
$
|
74
|
|
|
$
|
—
|
|
Commercial Real Estate
|
|
270,339
|
|
|
229
|
|
|
—
|
|
|
892
|
|
|
1,121
|
|
|
271,460
|
|
|
1,375
|
|
|
—
|
|
||||||||
Acquisition & Development
|
|
96,014
|
|
|
—
|
|
|
—
|
|
|
2,576
|
|
|
2,576
|
|
|
98,590
|
|
|
3,526
|
|
|
—
|
|
||||||||
Total Commercial
|
|
752,664
|
|
|
244
|
|
|
169
|
|
|
3,542
|
|
|
3,955
|
|
|
756,619
|
|
|
4,975
|
|
|
—
|
|
||||||||
Residential
|
|
212,502
|
|
|
2,067
|
|
|
419
|
|
|
464
|
|
|
2,950
|
|
|
215,452
|
|
|
1,072
|
|
|
—
|
|
||||||||
Home Equity
|
|
64,791
|
|
|
525
|
|
|
—
|
|
|
70
|
|
|
595
|
|
|
65,386
|
|
|
104
|
|
|
—
|
|
||||||||
Consumer
|
|
14,354
|
|
|
55
|
|
|
34
|
|
|
68
|
|
|
157
|
|
|
14,511
|
|
|
78
|
|
|
—
|
|
||||||||
Total Loans
|
|
$
|
1,044,311
|
|
|
$
|
2,891
|
|
|
$
|
622
|
|
|
$
|
4,144
|
|
|
$
|
7,657
|
|
|
$
|
1,051,968
|
|
|
$
|
6,229
|
|
|
$
|
—
|
|
(Dollars in thousands)
|
|
Commercial
|
|
Residential
|
|
Home Equity
|
|
Consumer
|
|
Total
|
||||||||||
ALL balance at December 31, 2016
|
|
$
|
7,181
|
|
|
$
|
990
|
|
|
$
|
728
|
|
|
$
|
202
|
|
|
$
|
9,101
|
|
Charge-offs
|
|
(1,138
|
)
|
|
(141
|
)
|
|
(109
|
)
|
|
(109
|
)
|
|
(1,497
|
)
|
|||||
Recoveries
|
|
39
|
|
|
40
|
|
|
4
|
|
|
18
|
|
|
101
|
|
|||||
Provision
|
|
1,722
|
|
|
230
|
|
|
82
|
|
|
139
|
|
|
2,173
|
|
|||||
ALL balance at December 31, 2017
|
|
$
|
7,804
|
|
|
$
|
1,119
|
|
|
$
|
705
|
|
|
$
|
250
|
|
|
$
|
9,878
|
|
Individually evaluated for impairment
|
|
$
|
1,172
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
16
|
|
|
$
|
1,188
|
|
Collectively evaluated for impairment
|
|
$
|
6,632
|
|
|
$
|
1,119
|
|
|
$
|
705
|
|
|
$
|
234
|
|
|
$
|
8,690
|
|
(Dollars in thousands)
|
|
Commercial
|
|
Residential
|
|
Home Equity
|
|
Consumer
|
|
Total
|
||||||||||
ALL balance at December 31, 2015
|
|
$
|
6,066
|
|
|
$
|
1,095
|
|
|
$
|
715
|
|
|
$
|
130
|
|
|
$
|
8,006
|
|
Charge-offs
|
|
(1,995
|
)
|
|
(124
|
)
|
|
(100
|
)
|
|
(338
|
)
|
|
(2,557
|
)
|
|||||
Recoveries
|
|
8
|
|
|
2
|
|
|
9
|
|
|
1
|
|
|
20
|
|
|||||
Provision
|
|
3,102
|
|
|
17
|
|
|
104
|
|
|
409
|
|
|
3,632
|
|
|||||
ALL balance at December 31, 2016
|
|
$
|
7,181
|
|
|
$
|
990
|
|
|
$
|
728
|
|
|
$
|
202
|
|
|
$
|
9,101
|
|
Individually evaluated for impairment
|
|
$
|
376
|
|
|
$
|
122
|
|
|
$
|
36
|
|
|
$
|
9
|
|
|
$
|
543
|
|
Collectively evaluated for impairment
|
|
$
|
6,805
|
|
|
$
|
868
|
|
|
$
|
692
|
|
|
$
|
193
|
|
|
$
|
8,558
|
|
(Dollars in thousands)
|
|
Commercial
|
|
Residential
|
|
Home Equity
|
|
Consumer
|
|
Total
|
||||||||||
ALL balance at December 31, 2014
|
|
$
|
4,363
|
|
|
$
|
962
|
|
|
$
|
691
|
|
|
$
|
207
|
|
|
$
|
6,223
|
|
Charge-offs
|
|
(708
|
)
|
|
(28
|
)
|
|
(5
|
)
|
|
(6
|
)
|
|
(747
|
)
|
|||||
Recoveries
|
|
20
|
|
|
2
|
|
|
4
|
|
|
11
|
|
|
37
|
|
|||||
Provision
|
|
2,391
|
|
|
159
|
|
|
25
|
|
|
(82
|
)
|
|
2,493
|
|
|||||
ALL balance at December 31, 2015
|
|
$
|
6,066
|
|
|
$
|
1,095
|
|
|
$
|
715
|
|
|
$
|
130
|
|
|
$
|
8,006
|
|
Individually evaluated for impairment
|
|
$
|
708
|
|
|
$
|
276
|
|
|
$
|
28
|
|
|
$
|
1
|
|
|
$
|
1,013
|
|
Collectively evaluated for impairment
|
|
$
|
5,358
|
|
|
$
|
819
|
|
|
$
|
687
|
|
|
$
|
129
|
|
|
$
|
6,993
|
|
|
|
New TDR's
1
|
||||||||||||||||||||
|
|
December 31, 2017
|
|
December 31, 2016
|
||||||||||||||||||
(Dollars in thousands)
|
|
Number of Contracts
|
|
Pre-Modification Outstanding Recorded Investment
|
|
Post-Modification Outstanding Recorded Investment
|
|
Number of Contracts
|
|
Pre-Modification Outstanding Recorded Investment
|
|
Post-Modification Outstanding Recorded Investment
|
||||||||||
Commercial
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial Business
|
|
1
|
|
|
$
|
147
|
|
|
$
|
147
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Commercial Real Estate
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Acquisition & Development
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total Commercial
|
|
1
|
|
|
147
|
|
|
147
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Residential
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Home Equity
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Consumer
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total
|
|
1
|
|
|
$
|
147
|
|
|
$
|
147
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
||||
Land
|
|
$
|
3,901
|
|
|
$
|
3,965
|
|
Buildings and improvements
|
|
17,358
|
|
|
16,906
|
|
||
Furniture, fixtures and equipment
|
|
14,864
|
|
|
12,127
|
|
||
Construction in progress
|
|
855
|
|
|
608
|
|
||
Leasehold improvements
|
|
1,530
|
|
|
1,345
|
|
||
|
|
38,508
|
|
|
34,951
|
|
||
Accumulated depreciation
|
|
(11,822
|
)
|
|
(9,870
|
)
|
||
Net premises and equipment
|
|
$
|
26,686
|
|
|
$
|
25,081
|
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
||||
Demand deposits of individuals, partnerships, and corporations
|
|
|
|
|
|
|
||
Noninterest bearing demand
|
|
$
|
125,963
|
|
|
$
|
115,692
|
|
Interest bearing demand
|
|
436,303
|
|
|
414,031
|
|
||
Savings and money markets
|
|
284,795
|
|
|
280,533
|
|
||
Time deposits including CDs and IRAs
|
|
312,519
|
|
|
296,761
|
|
||
Total deposits
|
|
$
|
1,159,580
|
|
|
$
|
1,107,017
|
|
|
|
|
|
|
||||
Time deposits that meet or exceed the FDIC insurance limit
|
|
$
|
18,832
|
|
|
$
|
18,727
|
|
2018
|
|
$
|
169,220
|
|
2019
|
|
61,254
|
|
|
2020
|
|
36,758
|
|
|
2021
|
|
12,268
|
|
|
2022
|
|
33,019
|
|
|
Total
|
|
$
|
312,519
|
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
||||
Fixed interest rate notes, originating between October 2006 and April 2007, due between October 2021 and April 2022, interest of between 5.18% and 5.20% payable monthly
|
|
$
|
1,798
|
|
|
$
|
2,390
|
|
Amortizing fixed interest rate note, originating February 2007, due February 2022, payable in monthly installments of $5 thousand, including interest of 5.22%
|
|
775
|
|
|
798
|
|
||
|
|
$
|
2,573
|
|
|
$
|
3,188
|
|
Information related to subordinated debt is summarized as follows:
|
||||||||||||
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Balance at end of year
|
|
$
|
33,524
|
|
|
$
|
33,524
|
|
|
$
|
33,524
|
|
Average balance during the year
|
|
33,524
|
|
|
33,524
|
|
|
33,524
|
|
|||
Maximum month-end balance
|
|
33,524
|
|
|
33,524
|
|
|
33,524
|
|
|||
Weighted-average rate during the year
|
|
6.69
|
%
|
|
6.64
|
%
|
|
6.57
|
%
|
|||
Weighted-average rate at December 31
|
|
6.70
|
%
|
|
6.63
|
%
|
|
6.57
|
%
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
||||
Available on lines of credit
|
|
$
|
327,647
|
|
|
$
|
255,469
|
|
Stand-by letters of credit
|
|
12,297
|
|
|
13,387
|
|
||
Other loan commitments
|
|
1,396
|
|
|
1,819
|
|
||
|
|
$
|
341,340
|
|
|
$
|
270,675
|
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Current:
|
|
|
|
|
|
|
||||||
Federal
|
|
$
|
2,635
|
|
|
$
|
4,885
|
|
|
$
|
2,830
|
|
State
|
|
771
|
|
|
1,197
|
|
|
591
|
|
|||
|
|
$
|
3,406
|
|
|
$
|
6,082
|
|
|
$
|
3,421
|
|
Deferred expense (benefit)
|
|
|
|
|
|
|
|
|
|
|||
Federal
|
|
$
|
1,268
|
|
|
$
|
665
|
|
|
$
|
(371
|
)
|
State
|
|
81
|
|
|
42
|
|
|
(24
|
)
|
|||
|
|
1,349
|
|
|
707
|
|
|
(395
|
)
|
|||
Income tax expense (benefit)
|
|
$
|
4,755
|
|
|
$
|
6,789
|
|
|
$
|
3,026
|
|
|
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||
(Dollars in thousands)
|
|
Amount
|
|
%
|
|
Amount
|
|
%
|
|
Amount
|
|
%
|
|||||||||
Tax at Federal tax rate
|
|
$
|
4,369
|
|
|
34
|
%
|
|
$
|
6,689
|
|
|
34
|
%
|
|
$
|
3,346
|
|
|
34
|
%
|
Tax effect of:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
State income tax
|
|
771
|
|
|
6.0
|
%
|
|
1,197
|
|
|
6.0
|
%
|
|
246
|
|
|
2.5
|
%
|
|||
Tax exempt earnings
|
|
(1,031
|
)
|
|
(6.4
|
)%
|
|
(1,097
|
)
|
|
(5.5
|
)%
|
|
(566
|
)
|
|
(5.8
|
)%
|
|||
Impact of deferred tax rate change
|
|
$
|
646
|
|
|
5.0
|
%
|
|
$
|
—
|
|
|
—
|
%
|
|
$
|
—
|
|
|
—
|
%
|
|
|
$
|
4,755
|
|
|
38.6
|
%
|
|
$
|
6,789
|
|
|
34.5
|
%
|
|
$
|
3,026
|
|
|
30.7
|
%
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
||||
Allowance for loan losses
|
|
$
|
2,798
|
|
|
$
|
2,641
|
|
Minimum pension liability
|
|
1,342
|
|
|
1,786
|
|
||
Unrealized loss on securities available-for-sale
|
|
2
|
|
|
1,066
|
|
||
Gross deferred tax assets
|
|
4,142
|
|
|
5,493
|
|
||
|
|
|
|
|
||||
Depreciation
|
|
(1,137
|
)
|
|
(1,352
|
)
|
||
Pension
|
|
(21
|
)
|
|
(6
|
)
|
||
Goodwill
|
|
(1,523
|
)
|
|
(465
|
)
|
||
Gross deferred tax liabilities
|
|
(2,681
|
)
|
|
(1,823
|
)
|
||
|
|
|
|
|
||||
Net deferred tax asset
|
|
$
|
1,461
|
|
|
$
|
3,670
|
|
(Dollars in thousands)
|
|
Balance at Beginning of Year
|
|
Borrowings
|
|
Executive Officer and Director Retirements
|
|
Repayments
|
|
Balance at End of Year
|
||||||||||
December 31, 2017
|
|
$
|
28,536
|
|
|
$
|
129,947
|
|
|
$
|
(525
|
)
|
|
$
|
(139,300
|
)
|
|
$
|
18,658
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2016
|
|
$
|
42,840
|
|
|
$
|
251,708
|
|
|
$
|
(7,194
|
)
|
|
$
|
(258,818
|
)
|
|
$
|
28,536
|
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
||||
Change in benefit obligation
|
|
|
|
|
||||
Benefit obligation at beginning of year
|
|
$
|
9,021
|
|
|
$
|
8,662
|
|
Service cost
|
|
—
|
|
|
—
|
|
||
Interest cost
|
|
360
|
|
|
367
|
|
||
Actuarial loss
|
|
95
|
|
|
4
|
|
||
Assumption changes
|
|
775
|
|
|
179
|
|
||
Curtailment impact
|
|
—
|
|
|
—
|
|
||
Benefits paid
|
|
(193
|
)
|
|
(191
|
)
|
||
Benefit obligation at end of year
|
|
$
|
10,058
|
|
|
$
|
9,021
|
|
|
|
|
|
|
||||
Change in plan assets:
|
|
|
|
|
||||
Fair value of plan assets at beginning of year
|
|
$
|
4,573
|
|
|
$
|
4,486
|
|
Actual return on plan assets
|
|
467
|
|
|
96
|
|
||
Employer contribution
|
|
319
|
|
|
182
|
|
||
Benefits paid
|
|
(193
|
)
|
|
(191
|
)
|
||
Fair value of plan assets at end of year
|
|
$
|
5,166
|
|
|
$
|
4,573
|
|
|
|
|
|
|
||||
Funded status
|
|
$
|
(4,892
|
)
|
|
$
|
(4,448
|
)
|
Unrecognized net actuarial loss
|
|
4,972
|
|
|
4,464
|
|
||
Unrecognized prior service cost
|
|
—
|
|
|
—
|
|
||
Prepaid pension cost recognized
|
|
$
|
80
|
|
|
$
|
16
|
|
|
|
|
|
|
||||
Accumulated benefit obligation
|
|
$
|
10,058
|
|
|
$
|
9,021
|
|
|
|
2017
|
|
2016
|
|
2015
|
|||
Discount rate
|
|
3.55
|
%
|
|
4.05
|
%
|
|
4.30
|
%
|
Rate of compensation increase
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
|
|
2017
|
|
2016
|
|
2015
|
|||
Discount rate
|
|
4.05
|
%
|
|
4.30
|
%
|
|
3.90
|
%
|
Expected long-term rate of return on plan assets
|
|
6.75
|
%
|
|
6.75
|
%
|
|
6.75
|
%
|
Rate of compensation increase
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
|
|
12/31/2017
|
|
12/31/2016
|
||
Plan Assets
|
|
|
|
|
||
Cash
|
|
9
|
%
|
|
16
|
%
|
Fixed income
|
|
23
|
%
|
|
28
|
%
|
Alternative investments
|
|
13
|
%
|
|
9
|
%
|
Domestic equities
|
|
32
|
%
|
|
28
|
%
|
Foreign equities
|
|
23
|
%
|
|
19
|
%
|
Total
|
|
100
|
%
|
|
100
|
%
|
(Dollars in thousands)
|
|
Level I
|
|
Level II
|
|
Level III
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Cash
|
|
$
|
465
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
465
|
|
Fixed income
|
|
1,188
|
|
|
—
|
|
|
—
|
|
|
1,188
|
|
||||
Alternative investments
|
|
—
|
|
|
—
|
|
|
672
|
|
|
672
|
|
||||
Domestic equities
|
|
1,653
|
|
|
—
|
|
|
—
|
|
|
1,653
|
|
||||
Foreign equities
|
|
1,188
|
|
|
—
|
|
|
—
|
|
|
1,188
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Total assets at fair value
|
|
$
|
4,494
|
|
|
$
|
—
|
|
|
$
|
672
|
|
|
$
|
5,166
|
|
(Dollars in thousands)
|
|
Level I
|
|
Level II
|
|
Level III
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Cash
|
|
$
|
732
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
732
|
|
Fixed income
|
|
1,280
|
|
|
—
|
|
|
—
|
|
|
1,280
|
|
||||
Alternative investments
|
|
—
|
|
|
—
|
|
|
412
|
|
|
412
|
|
||||
Domestic equities
|
|
1,280
|
|
|
—
|
|
|
—
|
|
|
1,280
|
|
||||
Foreign equities
|
|
869
|
|
|
—
|
|
|
—
|
|
|
869
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Total assets at fair value
|
|
$
|
4,161
|
|
|
$
|
—
|
|
|
$
|
412
|
|
|
$
|
4,573
|
|
The table below summarizes the changes in carrying amounts of goodwill and other intangibles (core deposit intangibles) for the periods presented:
|
||||||||||||||||
|
|
|
|
Core Deposit Intangible
|
||||||||||||
(Dollars in thousands)
|
|
Goodwill
|
|
Gross
|
|
Accumulated Depreciation
|
|
Net
|
||||||||
Balance at January 1, 2017
|
|
$
|
18,480
|
|
|
$
|
1,006
|
|
|
$
|
(262
|
)
|
|
$
|
744
|
|
Amortization expense
|
|
—
|
|
|
—
|
|
|
(98
|
)
|
|
(98
|
)
|
||||
Balance at December 31, 2017
|
|
$
|
18,480
|
|
|
$
|
1,006
|
|
|
$
|
(360
|
)
|
|
$
|
646
|
|
|
|
|
|
|
|
|
|
|
||||||||
Balance at January 1, 2016
|
|
$
|
18,480
|
|
|
$
|
1,006
|
|
|
$
|
(161
|
)
|
|
$
|
845
|
|
Amortization expense
|
|
—
|
|
|
—
|
|
|
(101
|
)
|
|
(101
|
)
|
||||
Balance at December 31, 2016
|
|
$
|
18,480
|
|
|
$
|
1,006
|
|
|
$
|
(262
|
)
|
|
$
|
744
|
|
|
|
|
|
|
|
|
|
|
||||||||
Balance at January 1, 2015
|
|
$
|
17,779
|
|
|
$
|
128
|
|
|
$
|
(127
|
)
|
|
$
|
1
|
|
Goodwill and core deposit intangible resulting from branch acquisition
|
|
701
|
|
|
878
|
|
|
—
|
|
|
878
|
|
||||
Amortization expense
|
|
—
|
|
|
—
|
|
|
(34
|
)
|
|
(34
|
)
|
||||
Balance at December 31, 2015
|
|
$
|
18,480
|
|
|
$
|
1,006
|
|
|
$
|
(161
|
)
|
|
$
|
845
|
|
|
|
2017
|
|
2016
|
||||||||||
|
|
Number of Shares
|
|
Weighted Average Exercise Price
|
|
Number of Shares
|
|
Weighted Average Exercise Price
|
||||||
Outstanding at beginning of year
|
|
1,499,795
|
|
|
$
|
13.11
|
|
|
1,190,295
|
|
|
$
|
13.15
|
|
Granted
|
|
321,750
|
|
|
15.12
|
|
|
432,000
|
|
|
12.72
|
|
||
Exercised
|
|
(49,400
|
)
|
|
12.24
|
|
|
(55,000
|
)
|
|
9.02
|
|
||
Forfeited/expired
|
|
(94,500
|
)
|
|
8.41
|
|
|
(67,500
|
)
|
|
14.59
|
|
||
|
|
|
|
|
|
|
|
|
||||||
Outstanding at end of year
|
|
1,677,645
|
|
|
$
|
13.46
|
|
|
1,499,795
|
|
|
$
|
13.11
|
|
|
|
|
|
|
|
|
|
|
||||||
Exercisable at end of year
|
|
910,647
|
|
|
$
|
13.00
|
|
|
768,598
|
|
|
$
|
12.75
|
|
|
|
|
|
|
|
|
|
|
||||||
Weighted-average fair value of options granted during 2017
|
|
|
|
|
$
|
4.05
|
|
|
|
|
|
|
|
|
Weighted-average fair value of options granted during 2016
|
|
|
|
|
$
|
2.98
|
|
|
|
|
|
|
|
|
Weighted-average fair value of options granted during 2015
|
|
|
|
$
|
2.72
|
|
|
|
|
|
|
|
Options Outstanding
|
|
Options Exercisable
|
|||||||||||||||||||
Total Options
|
|
Weighted-Average Exercise Price
|
|
Intrinsic Value
|
|
Weighted-Average Remaining Life
|
|
Total Options
|
|
Weighted-Average Exercise Price
|
|
Intrinsic Value
|
|
Weighted-Average Remaining Life
|
|||||||
1,677,645
|
|
$
|
13.46
|
|
|
11,145,745
|
|
|
6.63
|
|
910,647
|
|
|
$
|
13.00
|
|
|
6,465,272
|
|
|
5.28
|
The most recent notification from the Federal Deposit Insurance Corporation categorized the Bank as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized, the Bank must maintain minimum total risk-based, Tier 1 risk-based, Tier 1 common equity risk-based and Tier 1 leverage ratios as set forth in the table below. Both the Company’s and the Bank’s actual capital amounts and ratios are presented in the table below.
|
|||||||||||||||||||||
|
|
Actual
|
|
Minimum to be Well Capitalized
|
|
Minimum for Capital Adequacy Purposes
|
|||||||||||||||
(Dollars in thousands)
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|||||||||
As of December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Total Capital (to risk-weighted assets)
|
|||||||||||||||||||||
Consolidated
|
|
$
|
178,147
|
|
|
14.9
|
%
|
|
n/a
|
|
|
n/a
|
|
|
$
|
95,948
|
|
|
8.0
|
%
|
|
Subsidiary Bank
|
|
$
|
169,536
|
|
|
14.2
|
%
|
|
$
|
119,231
|
|
|
10.0
|
%
|
|
$
|
95,385
|
|
|
8.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Tier 1 Capital (to risk-weighted assets)
|
|||||||||||||||||||||
Consolidated
|
|
$
|
138,308
|
|
|
11.5
|
%
|
|
n/a
|
|
|
n/a
|
|
|
$
|
71,886
|
|
|
6.0
|
%
|
|
Subsidiary Bank
|
|
$
|
159,097
|
|
|
13.3
|
%
|
|
$
|
95,385
|
|
|
8.0
|
%
|
|
$
|
71,539
|
|
|
6.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Common Equity Tier 1 Capital (to risk-weighted assets)
|
|||||||||||||||||||||
Consolidated
|
|
$
|
126,350
|
|
|
10.6
|
%
|
|
n/a
|
|
|
n/a
|
|
|
$
|
53,915
|
|
|
4.5
|
%
|
|
Subsidiary Bank
|
|
$
|
159,097
|
|
|
13.3
|
%
|
|
$
|
77,500
|
|
|
6.5
|
%
|
|
$
|
53,654
|
|
|
4.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Tier 1 Capital (to average assets)
|
|||||||||||||||||||||
Consolidated
|
|
$
|
138,308
|
|
|
9.3
|
%
|
|
n/a
|
|
|
n/a
|
|
|
$
|
58,667
|
|
|
4.0
|
%
|
|
Subsidiary Bank
|
|
$
|
159,097
|
|
|
10.7
|
%
|
|
$
|
73,119
|
|
|
5.0
|
%
|
|
$
|
58,495
|
|
|
4.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
As of December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Total Capital (to risk-weighted assets)
|
|||||||||||||||||||||
Consolidated
|
|
$
|
174,093
|
|
|
15.4
|
%
|
|
n/a
|
|
|
n/a
|
|
|
$
|
90,699
|
|
|
8.0
|
%
|
|
Subsidiary Bank
|
|
$
|
163,394
|
|
|
14.5
|
%
|
|
$
|
113,027
|
|
|
10.0
|
%
|
|
$
|
90,422
|
|
|
8.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Tier 1 Capital (to risk-weighted assets)
|
|||||||||||||||||||||
Consolidated
|
|
$
|
135,100
|
|
|
11.9
|
%
|
|
n/a
|
|
|
n/a
|
|
|
$
|
68,025
|
|
|
6.0
|
%
|
|
Subsidiary Bank
|
|
$
|
153,737
|
|
|
13.6
|
%
|
|
$
|
90,422
|
|
|
8.0
|
%
|
|
$
|
67,816
|
|
|
6.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Common Equity Tier 1 Capital (to risk-weighted assets)
|
|||||||||||||||||||||
Consolidated
|
|
$
|
114,642
|
|
|
10.1
|
%
|
|
n/a
|
|
|
n/a
|
|
|
$
|
51,018
|
|
|
4.5
|
%
|
|
Subsidiary Bank
|
|
$
|
153,737
|
|
|
13.6
|
%
|
|
$
|
73,468
|
|
|
6.5
|
%
|
|
$
|
50,862
|
|
|
4.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Tier 1 Capital (to average assets)
|
|||||||||||||||||||||
Consolidated
|
|
$
|
135,100
|
|
|
9.5
|
%
|
|
n/a
|
|
|
n/a
|
|
|
$
|
56,655
|
|
|
4.0
|
%
|
|
Subsidiary Bank
|
|
$
|
153,737
|
|
|
10.9
|
%
|
|
$
|
70,651
|
|
|
5.0
|
%
|
|
$
|
56,521
|
|
|
4.0
|
%
|
(Dollars in thousands)
|
|
|
||
Years ended December 31:
|
|
|
|
|
2018
|
|
$
|
1,822
|
|
2019
|
|
1,299
|
|
|
2020
|
|
1,244
|
|
|
2021
|
|
1,268
|
|
|
2022
|
|
1,201
|
|
|
Thereafter
|
|
5,185
|
|
|
Total minimum payments required:
|
|
$
|
12,019
|
|
Level I:
|
Quoted prices are available in active markets for identical assets or liabilities as of the reported date.
|
|
|
Level II:
|
Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly observable as of the reported date. The nature of these assets and liabilities include items for which quoted prices are available but traded less frequently, and items that are fair valued using other financial instruments, the parameters of which can be directly observed.
|
|
|
Level III:
|
Assets and liabilities that have little to no pricing observability as of the reported date. These items do not have two-way markets and are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment or estimation.
|
Fair Value Measurements at:
|
||||||||||||||||||||
(Dollars in thousands)
|
|
Carrying Value
|
|
Estimated Fair Value
|
|
Quoted Prices in Active Markets for Identical Assets (Level I)
|
|
Significant Other Observable Inputs (Level II)
|
|
Significant Unobservable Inputs (Level III)
|
||||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and cash equivalents
|
|
$
|
20,305
|
|
|
$
|
20,305
|
|
|
$
|
20,305
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Certificates of deposits with other banks
|
|
14,778
|
|
|
14,695
|
|
|
—
|
|
|
14,695
|
|
|
—
|
|
|||||
Securities available-for-sale
|
|
231,507
|
|
|
231,507
|
|
|
1,607
|
|
|
206,991
|
|
|
22,909
|
|
|||||
Loans held for sale
|
|
66,794
|
|
|
66,794
|
|
|
—
|
|
|
66,794
|
|
|
—
|
|
|||||
Loans, net
|
|
1,096,063
|
|
|
1,093,824
|
|
|
—
|
|
|
—
|
|
|
1,093,824
|
|
|||||
Mortgage servicing rights
|
|
182
|
|
|
182
|
|
|
—
|
|
|
—
|
|
|
182
|
|
|||||
Interest rate lock commitment
|
|
1,426
|
|
|
1,426
|
|
|
—
|
|
|
—
|
|
|
1,426
|
|
|||||
Interest rate swap
|
|
268
|
|
|
268
|
|
|
—
|
|
|
268
|
|
|
—
|
|
|||||
Interest rate cap
|
|
33
|
|
|
33
|
|
|
—
|
|
|
33
|
|
|
—
|
|
|||||
Accrued interest receivable
|
|
5,296
|
|
|
5,296
|
|
|
—
|
|
|
1,241
|
|
|
4,055
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Deposits
|
|
$
|
1,159,580
|
|
|
$
|
1,126,615
|
|
|
$
|
—
|
|
|
$
|
1,126,615
|
|
|
$
|
—
|
|
Repurchase agreements
|
|
22,403
|
|
|
22,403
|
|
|
—
|
|
|
22,403
|
|
|
—
|
|
|||||
FHLB and other borrowings
|
|
152,169
|
|
|
152,190
|
|
|
—
|
|
|
152,190
|
|
|
—
|
|
|||||
Mortgage-backed security hedges
|
|
78
|
|
|
78
|
|
|
—
|
|
|
78
|
|
|
—
|
|
|||||
Interest rate swap
|
|
268
|
|
|
268
|
|
|
—
|
|
|
268
|
|
|
—
|
|
|||||
Accrued interest payable
|
|
643
|
|
|
643
|
|
|
—
|
|
|
643
|
|
|
—
|
|
|||||
Subordinated debt
|
|
33,524
|
|
|
35,117
|
|
|
—
|
|
|
35,117
|
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and cash equivalents
|
|
$
|
17,340
|
|
|
$
|
17,340
|
|
|
$
|
17,340
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Certificates of deposits with other banks
|
|
14,527
|
|
|
14,985
|
|
|
—
|
|
|
14,985
|
|
|
—
|
|
|||||
Securities available-for-sale
|
|
162,368
|
|
|
162,368
|
|
|
897
|
|
|
161,471
|
|
|
—
|
|
|||||
Loans held for sale
|
|
90,174
|
|
|
90,174
|
|
|
—
|
|
|
90,174
|
|
|
—
|
|
|||||
Loans, net
|
|
1,043,764
|
|
|
1,035,437
|
|
|
—
|
|
|
—
|
|
|
1,035,437
|
|
|||||
Mortgage servicing rights
|
|
190
|
|
|
190
|
|
|
—
|
|
|
—
|
|
|
190
|
|
|||||
Interest rate lock commitment
|
|
1,546
|
|
|
1,546
|
|
|
—
|
|
|
—
|
|
|
1,546
|
|
|||||
Mortgage-backed security hedges
|
|
372
|
|
|
372
|
|
|
—
|
|
|
372
|
|
|
—
|
|
|||||
Interest rate swap
|
|
250
|
|
|
250
|
|
|
—
|
|
|
250
|
|
|
—
|
|
|||||
Interest rate cap
|
|
268
|
|
|
268
|
|
|
—
|
|
|
268
|
|
|
—
|
|
|||||
Accrued interest receivable
|
|
3,951
|
|
|
3,951
|
|
|
—
|
|
|
1,002
|
|
|
2,949
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Deposits
|
|
$
|
1,107,017
|
|
|
$
|
1,116,174
|
|
|
$
|
—
|
|
|
$
|
1,116,174
|
|
|
$
|
—
|
|
Repurchase agreements
|
|
25,160
|
|
|
25,160
|
|
|
—
|
|
|
25,160
|
|
|
—
|
|
|||||
FHLB and other borrowings
|
|
90,921
|
|
|
90,919
|
|
|
—
|
|
|
90,919
|
|
|
—
|
|
|||||
Interest rate swap
|
|
250
|
|
|
250
|
|
|
—
|
|
|
250
|
|
|
—
|
|
|||||
Accrued interest payable
|
|
741
|
|
|
741
|
|
|
—
|
|
|
741
|
|
|
—
|
|
|||||
Subordinated debt
|
|
33,524
|
|
|
32,275
|
|
|
—
|
|
|
32,275
|
|
|
—
|
|
•
|
Available-for-sale investment securities —
Available-for-sale investment securities are recorded at fair value on a recurring basis. Fair value measurement is based upon quoted prices, if available. If quoted prices are not available, fair values are measured using independent pricing models or other model-based valuation techniques such as the present value of future cash flows, adjusted for the security's credit rating, prepayment assumptions and other factors such as credit loss assumptions. Level I securities include those traded on an active exchange, such as the New York Stock Exchange, U.S. Treasury securities that are traded by dealers or brokers in active over-the-counter markets and money market funds. Level II securities include mortgage-backed securities issued by government sponsored entities and private label entities, municipal bonds and corporate debt securities. There have been no changes in valuation techniques for the year ended
December 31, 2017
. Valuation techniques are consistent with techniques used in prior periods.
|
•
|
Loans held for sale —
The fair value of mortgage loans held for sale is determined, when possible, using quoted secondary-market prices or investor commitments. If no such quoted price exists, the fair value of a loan is determined using quoted prices for a similar asset or assets, adjusted for the specific attributes of that loan, which would be used by other market participants.
|
•
|
Interest rate lock commitment —
The Company estimates the fair value of interest rate lock commitments based on the value of the underlying mortgage loan, quoted mortgage-backed security prices and estimates of the fair value of the mortgage servicing rights and the probability that the mortgage loan will fund within the terms of the interest rate lock commitments.
|
•
|
Mortgage-backed security hedges —
MBS hedges are considered derivatives and are recorded at fair value based on observable market data of the individual mortgage-backed security.
|
•
|
Interest rate cap —
The fair value of the interest rate cap is determined at the end of each quarter by using Bloomberg Finance which values the interest rate cap using observable inputs from forward and futures yield curves as well as standard market volatility.
|
•
|
Interest rate swap —
Interest rate swaps are recorded at fair value based on third party vendors who compile prices from various sources and may determine fair value of identical or similar instruments by using pricing models that consider observable market data.
|
|
|
December 31, 2017
|
||||||||||||||
(Dollars in thousands)
|
|
Level I
|
|
Level II
|
|
Level III
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. Government Agency securities
|
|
$
|
—
|
|
|
$
|
80,945
|
|
|
$
|
—
|
|
|
$
|
80,945
|
|
U.S. Sponsored Mortgage backed securities
|
|
—
|
|
|
58,154
|
|
|
—
|
|
|
58,154
|
|
||||
Municipal securities
|
|
—
|
|
|
52,933
|
|
|
22,909
|
|
|
75,842
|
|
||||
Equity and other securities
|
|
1,607
|
|
|
16,566
|
|
|
—
|
|
|
16,566
|
|
||||
Loans held for sale
|
|
—
|
|
|
66,794
|
|
|
—
|
|
|
66,794
|
|
||||
Interest rate lock commitment
|
|
—
|
|
|
—
|
|
|
1,426
|
|
|
1,426
|
|
||||
Interest rate swap
|
|
—
|
|
|
268
|
|
|
—
|
|
|
268
|
|
||||
Interest rate cap
|
|
—
|
|
|
33
|
|
|
—
|
|
|
33
|
|
||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest rate swap
|
|
—
|
|
|
268
|
|
|
—
|
|
|
268
|
|
||||
Mortgage-backed security hedges
|
|
—
|
|
|
78
|
|
|
—
|
|
|
78
|
|
|
|
December 31, 2016
|
||||||||||||||
(Dollars in thousands)
|
|
Level I
|
|
Level II
|
|
Level III
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. Government Agency securities
|
|
$
|
—
|
|
|
$
|
28,816
|
|
|
$
|
—
|
|
|
$
|
28,816
|
|
U.S. Sponsored Mortgage backed securities
|
|
—
|
|
|
54,732
|
|
|
—
|
|
|
54,732
|
|
||||
Municipal securities
|
|
—
|
|
|
70,796
|
|
|
—
|
|
|
70,796
|
|
||||
Equity and other securities
|
|
897
|
|
|
8,024
|
|
|
—
|
|
|
8,024
|
|
||||
Loans held for sale
|
|
—
|
|
|
90,174
|
|
|
—
|
|
|
90,174
|
|
||||
Interest rate lock commitment
|
|
—
|
|
|
—
|
|
|
1,546
|
|
|
1,546
|
|
||||
Mortgage-backed security hedges
|
|
—
|
|
|
372
|
|
|
—
|
|
|
372
|
|
||||
Interest rate swap
|
|
—
|
|
|
250
|
|
|
—
|
|
|
250
|
|
||||
Interest rate cap
|
|
—
|
|
|
268
|
|
|
—
|
|
|
268
|
|
||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest rate swap
|
|
—
|
|
|
250
|
|
|
—
|
|
|
250
|
|
•
|
Impaired Loans —
Loans for which it is probable that payment of interest and principal will not be made in accordance with the contractual terms of the loan agreement are considered impaired. Once a loan is identified as individually impaired, management measures impairment using one of several methods, including collateral value, liquidation value and discounted cash flows. Those impaired loans not requiring an allowance represent loans for which the fair value of the expected repayments or collateral exceed the recorded investments in such loans. Collateral values are estimated using Level II inputs based on observable market data or Level III inputs based on customized discounting criteria. For a majority of impaired real estate related loans, the Company obtains a current external appraisal. Other valuation techniques are used as well, including internal valuations, comparable property analysis and contractual sales information.
|
•
|
Other Real Estate owned —
Other real estate owned, which is obtained through the Bank’s foreclosure process is valued utilizing the appraised collateral value. Collateral values are estimated using Level II inputs based on observable market data or Level III inputs based on customized discounting criteria. At the time, the foreclosure is completed, the Company obtains a current external appraisal.
|
|
|
December 31, 2017
|
||||||||||||||
(Dollars in thousands)
|
|
Level I
|
|
Level II
|
|
Level III
|
|
Total
|
||||||||
Impaired loans
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
14,368
|
|
|
$
|
14,368
|
|
Other real estate owned
|
|
—
|
|
|
—
|
|
|
1,346
|
|
|
1,346
|
|
|
|
December 31, 2016
|
||||||||||||||
(Dollars in thousands)
|
|
Level I
|
|
Level II
|
|
Level III
|
|
Total
|
||||||||
Impaired loans
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
11,609
|
|
|
$
|
11,609
|
|
Other real estate owned
|
|
—
|
|
|
—
|
|
|
414
|
|
|
414
|
|
|
|
Quantitative Information about Level III Fair Value Measurements
|
||||||||
(Dollars in thousands)
|
|
Fair Value
|
|
Valuation Technique
|
|
Unobservable Input
|
|
Range
|
||
December 31, 2017
|
|
|
|
|
|
|
|
|
||
Nonrecurring measurements:
|
|
|
|
|
|
|
|
|
||
Impaired loans
|
|
$
|
14,368
|
|
|
Appraisal of collateral
1
|
|
Appraisal adjustments
2
|
|
20% - 62%
|
|
|
|
|
|
|
|
Liquidation expense
2
|
|
5% - 10%
|
|
|
|
|
|
|
|
|
|
|
||
Other real estate owned
|
|
$
|
1,346
|
|
|
Appraisal of collateral
1
|
|
Appraisal adjustments
2
|
|
20% - 30%
|
|
|
|
|
|
|
|
Liquidation expense
2
|
|
5% - 10%
|
|
|
|
|
|
|
|
|
|
|
||
Recurring measurements:
|
|
|
|
|
|
|
|
|
||
Interest rate lock commitments
|
|
$
|
1,426
|
|
|
Pricing model
|
|
Pull through rates
|
|
73% - 85%
|
|
|
Quantitative Information about Level III Fair Value Measurements
|
||||||||
(Dollars in thousands)
|
|
Fair Value
|
|
Valuation Technique
|
|
Unobservable Input
|
|
Range
|
||
December 31, 2016
|
|
|
|
|
|
|
|
|
||
Nonrecurring measurements:
|
|
|
|
|
|
|
|
|
||
Impaired loans
|
|
$
|
11,609
|
|
|
Appraisal of collateral
1
|
|
Appraisal adjustments
2
|
|
20% - 62%
|
|
|
|
|
|
|
|
Liquidation expense
2
|
|
5% - 10%
|
|
|
|
|
|
|
|
|
|
|
||
Other real estate owned
|
|
$
|
414
|
|
|
Appraisal of collateral
1
|
|
Appraisal adjustments
2
|
|
20% - 30%
|
|
|
|
|
|
|
|
Liquidation expense
2
|
|
5% - 10%
|
|
|
|
|
|
|
|
|
|
|
||
Recurring measurements:
|
|
|
|
|
|
|
|
|
||
Interest rate lock commitments
|
|
$
|
1,546
|
|
|
Pricing model
|
|
Pull through rates
|
|
73% - 85%
|
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
|
|
||||||
Details about AOCI Components
|
|
Amount Reclassified from AOCI
|
|
Amount Reclassified from AOCI
|
|
Amount Reclassified from AOCI
|
|
Affected line item in the Statement where Net Income is presented
|
||||||
Available-for-sale securities
|
|
|
|
|
|
|
|
|
|
|
|
|||
Unrealized holding gains
|
|
$
|
731
|
|
|
$
|
1,082
|
|
|
$
|
130
|
|
|
Gain on sale of securities
|
|
|
731
|
|
|
1,082
|
|
|
130
|
|
|
Total before tax
|
|||
|
|
(292
|
)
|
|
(433
|
)
|
|
(52
|
)
|
|
Income tax expense
|
|||
|
|
439
|
|
|
649
|
|
|
78
|
|
|
Net of tax
|
|||
Defined benefit pension plan items
|
|
|
|
|
|
|
|
|
|
|
|
|||
Amortization of net actuarial loss
|
|
(241
|
)
|
|
(236
|
)
|
|
(257
|
)
|
|
Salaries and benefits
|
|||
|
|
(241
|
)
|
|
(236
|
)
|
|
(257
|
)
|
|
Total before tax
|
|||
|
|
96
|
|
|
94
|
|
|
103
|
|
|
Income tax expense
|
|||
|
|
(145
|
)
|
|
(142
|
)
|
|
(154
|
)
|
|
Net of tax
|
|||
|
|
|
|
|
|
|
|
|
||||||
Total reclassifications
|
|
$
|
294
|
|
|
$
|
507
|
|
|
$
|
(76
|
)
|
|
|
(Dollars in thousands)
|
|
Unrealized gains (losses) on available for-sale securities
|
|
Defined benefit pension plan items
|
|
Total
|
||||||
Balance at January 1, 2017
|
|
$
|
(1,598
|
)
|
|
$
|
(2,679
|
)
|
|
$
|
(4,277
|
)
|
Other comprehensive loss before reclassification
|
|
2,032
|
|
|
(449
|
)
|
|
1,583
|
|
|||
Amounts reclassified from AOCI
|
|
(439
|
)
|
|
145
|
|
|
(294
|
)
|
|||
Net current period OCI
|
|
1,593
|
|
|
(304
|
)
|
|
1,289
|
|
|||
Balance at December 31, 2017
|
|
$
|
(5
|
)
|
|
$
|
(2,983
|
)
|
|
$
|
(2,988
|
)
|
|
|
|
|
|
|
|
||||||
Balance at January 1, 2016
|
|
$
|
(363
|
)
|
|
$
|
(2,570
|
)
|
|
$
|
(2,933
|
)
|
Other comprehensive loss before reclassification
|
|
(586
|
)
|
|
(251
|
)
|
|
(837
|
)
|
|||
Amounts reclassified from AOCI
|
|
(649
|
)
|
|
142
|
|
|
(507
|
)
|
|||
Net current period OCI
|
|
(1,235
|
)
|
|
(109
|
)
|
|
(1,344
|
)
|
|||
Balance at December 31, 2016
|
|
$
|
(1,598
|
)
|
|
$
|
(2,679
|
)
|
|
$
|
(4,277
|
)
|
Condensed Balance Sheets
|
||||||||
|
|
December 31,
|
||||||
(Dollars in thousands)
|
|
2017
|
|
2016
|
||||
Assets
|
|
|
|
|
|
|
||
Cash
|
|
$
|
3,904
|
|
|
$
|
7,699
|
|
Investment in subsidiaries
|
|
175,027
|
|
|
168,325
|
|
||
Other assets
|
|
5,743
|
|
|
4,316
|
|
||
Total assets
|
|
$
|
184,674
|
|
|
$
|
180,340
|
|
|
|
|
|
|
||||
Liabilities and stockholders’ equity
|
|
|
|
|
|
|
||
Other liabilities
|
|
$
|
958
|
|
|
$
|
1,191
|
|
Long-term debt
|
|
33,524
|
|
|
33,524
|
|
||
Total liabilities
|
|
34,482
|
|
|
34,715
|
|
||
|
|
|
|
|
||||
Total stockholders’ equity
|
|
150,192
|
|
|
145,625
|
|
||
Total liabilities and stockholders’ equity
|
|
$
|
184,674
|
|
|
$
|
180,340
|
|
Condensed Statements of Income
|
||||||||||||
|
|
Year ended December 31,
|
||||||||||
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Income - dividends from bank subsidiary
|
|
$
|
13,724
|
|
|
$
|
9,241
|
|
|
$
|
7,744
|
|
Expenses - operating
|
|
11,974
|
|
|
11,307
|
|
|
8,988
|
|
|||
Income (loss) before income taxes and undistributed earnings - continuing operations
|
|
1,750
|
|
|
(2,066
|
)
|
|
(1,244
|
)
|
|||
Income tax (benefit) - continuing operations
|
|
(2,147
|
)
|
|
(2,072
|
)
|
|
(1,597
|
)
|
|||
Income after tax from continuing operations
|
|
3,897
|
|
|
6
|
|
|
353
|
|
|||
Income before income taxes and undistributed earnings - discontinued operations
|
|
—
|
|
|
6,926
|
|
|
—
|
|
|||
Income tax - discontinued operations
|
|
—
|
|
|
2,629
|
|
|
—
|
|
|||
Income after tax from discontinued operations
|
|
—
|
|
|
4,297
|
|
|
—
|
|
|||
Equity in undistributed income earnings of subsidiaries
|
|
3,678
|
|
|
8,609
|
|
|
6,463
|
|
|||
Net Income
|
|
$
|
7,575
|
|
|
$
|
12,912
|
|
|
$
|
6,816
|
|
|
|
|
|
|
|
|
||||||
Preferred dividends
|
|
$
|
498
|
|
|
$
|
1,128
|
|
|
$
|
575
|
|
Net Income available to common shareholders
|
|
$
|
7,077
|
|
|
$
|
11,784
|
|
|
$
|
6,241
|
|
Condensed Statements of Cash Flows
|
||||||||||||
(Dollars in thousands)
|
|
2017
|
|
2016
|
|
2015
|
||||||
OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|||
Net Income
|
|
$
|
7,575
|
|
|
$
|
12,912
|
|
|
$
|
6,816
|
|
Equity in undistributed earnings of subsidiaries
|
|
(3,678
|
)
|
|
(8,609
|
)
|
|
(6,463
|
)
|
|||
(Decrease) in other assets
|
|
(2,214
|
)
|
|
(612
|
)
|
|
(529
|
)
|
|||
Decrease (increase) in other liabilities
|
|
(234
|
)
|
|
920
|
|
|
(261
|
)
|
|||
Stock option expense
|
|
813
|
|
|
568
|
|
|
413
|
|
|||
|
|
|
|
|
|
|
||||||
Net cash provided by (used in) operating activities
|
|
2,262
|
|
|
5,179
|
|
|
(24
|
)
|
|||
|
|
|
|
|
|
|
||||||
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|||
Investment in subsidiary
|
|
(947
|
)
|
|
(19,697
|
)
|
|
(400
|
)
|
|||
|
|
|
|
|
|
|
||||||
Net cash used in investing activities
|
|
(947
|
)
|
|
(19,697
|
)
|
|
(400
|
)
|
|||
|
|
|
|
|
|
|
||||||
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|||
Proceeds of stock offering
|
|
4,931
|
|
|
20,519
|
|
|
—
|
|
|||
Dividend reinvestment plan
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Proceeds from subordinated debt
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Preferred stock issuance
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Preferred stock redemption
|
|
(8,500
|
)
|
|
—
|
|
|
—
|
|
|||
Common stock options exercised
|
|
(10
|
)
|
|
32
|
|
|
(448
|
)
|
|||
Cash dividends paid on common stock
|
|
(1,033
|
)
|
|
(646
|
)
|
|
(641
|
)
|
|||
Cash dividends paid on preferred stock
|
|
(498
|
)
|
|
(1,128
|
)
|
|
(575
|
)
|
|||
|
|
|
|
|
|
|
||||||
Net cash (used in) provided by financing activities
|
|
(5,110
|
)
|
|
18,777
|
|
|
(1,664
|
)
|
|||
|
|
|
|
|
|
|
||||||
(Decrease) increase in cash
|
|
(3,795
|
)
|
|
4,259
|
|
|
(2,088
|
)
|
|||
|
|
|
|
|
|
|
||||||
Cash at beginning of period
|
|
7,699
|
|
|
3,440
|
|
|
5,528
|
|
|||
|
|
|
|
|
|
|
||||||
Cash at end of period
|
|
$
|
3,904
|
|
|
$
|
7,699
|
|
|
$
|
3,440
|
|
|
|
2017
|
||||||||||||||||||
(Dollars in thousands)
|
|
Commercial & Retail Banking
|
|
Mortgage Banking
|
|
Financial Holding Company
|
|
Intercompany Eliminations
|
|
Consolidated
|
||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest income
|
|
$
|
52,423
|
|
|
$
|
4,698
|
|
|
$
|
4
|
|
|
$
|
(527
|
)
|
|
$
|
56,598
|
|
Mortgage fee income
|
|
736
|
|
|
37,262
|
|
|
—
|
|
|
(849
|
)
|
|
37,149
|
|
|||||
Insurance and investment services income
|
|
563
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
563
|
|
|||||
Other income
|
|
5,303
|
|
|
(2,372
|
)
|
|
5,466
|
|
|
(5,403
|
)
|
|
2,994
|
|
|||||
Total operating income
|
|
59,025
|
|
|
39,588
|
|
|
5,470
|
|
|
(6,779
|
)
|
|
97,304
|
|
|||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense
|
|
9,118
|
|
|
2,317
|
|
|
2,241
|
|
|
(1,375
|
)
|
|
12,301
|
|
|||||
Salaries and employee benefits
|
|
12,266
|
|
|
26,196
|
|
|
5,646
|
|
|
—
|
|
|
44,108
|
|
|||||
Provision for loan losses
|
|
1,967
|
|
|
206
|
|
|
—
|
|
|
—
|
|
|
2,173
|
|
|||||
Other expense
|
|
19,523
|
|
|
8,188
|
|
|
4,085
|
|
|
(5,404
|
)
|
|
26,392
|
|
|||||
Total operating expenses
|
|
42,874
|
|
|
36,907
|
|
|
11,972
|
|
|
(6,779
|
)
|
|
84,974
|
|
|||||
Income (loss) from continuing operations, before income taxes
|
|
16,151
|
|
|
2,681
|
|
|
(6,502
|
)
|
|
—
|
|
|
12,330
|
|
|||||
Income tax expense (benefit) - continuing operations
|
|
5,820
|
|
|
1,082
|
|
|
(2,147
|
)
|
|
—
|
|
|
4,755
|
|
|||||
Net income (loss) from continuing operations
|
|
10,331
|
|
|
1,599
|
|
|
(4,355
|
)
|
|
—
|
|
|
7,575
|
|
|||||
Income (loss) from discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Income tax expense (benefit) - discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net income (loss) from discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net income (loss)
|
|
$
|
10,331
|
|
|
$
|
1,599
|
|
|
$
|
(4,355
|
)
|
|
$
|
—
|
|
|
$
|
7,575
|
|
Preferred stock dividends
|
|
—
|
|
|
—
|
|
|
498
|
|
|
—
|
|
|
498
|
|
|||||
Net income (loss) available to common shareholders
|
|
$
|
10,331
|
|
|
$
|
1,599
|
|
|
$
|
(4,853
|
)
|
|
$
|
—
|
|
|
$
|
7,077
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital Expenditures for the year ended December 31, 2017
|
|
$
|
3,226
|
|
|
$
|
1,187
|
|
|
$
|
83
|
|
|
$
|
—
|
|
|
$
|
4,496
|
|
Total Assets as of December 31, 2017
|
|
1,533,497
|
|
|
149,323
|
|
|
184,600
|
|
|
(333,118
|
)
|
|
1,534,302
|
|
|||||
Goodwill as of December 31, 2017
|
|
1,598
|
|
|
16,882
|
|
|
—
|
|
|
—
|
|
|
18,480
|
|
|
|
2016
|
||||||||||||||||||||||
(Dollars in thousands)
|
|
Commercial & Retail Banking
|
|
Mortgage Banking
|
|
Financial Holding Company
|
|
Insurance
|
|
Intercompany Eliminations
|
|
Consolidated
|
||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest income
|
|
$
|
50,413
|
|
|
$
|
4,285
|
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
(578
|
)
|
|
$
|
54,123
|
|
Mortgage fee income
|
|
(252
|
)
|
|
36,960
|
|
|
—
|
|
|
—
|
|
|
(1,035
|
)
|
|
35,673
|
|
||||||
Insurance and investment services income
|
|
420
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
420
|
|
||||||
Other income
|
|
5,485
|
|
|
1,674
|
|
|
5,247
|
|
|
—
|
|
|
(5,294
|
)
|
|
7,112
|
|
||||||
Total operating income
|
|
56,066
|
|
|
42,919
|
|
|
5,250
|
|
|
—
|
|
|
(6,907
|
)
|
|
97,328
|
|
||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest expense
|
|
8,437
|
|
|
2,082
|
|
|
2,226
|
|
|
—
|
|
|
(1,613
|
)
|
|
11,132
|
|
||||||
Salaries and employee benefits
|
|
11,592
|
|
|
27,696
|
|
|
5,937
|
|
|
—
|
|
|
—
|
|
|
45,225
|
|
||||||
Provision for loan losses
|
|
3,632
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,632
|
|
||||||
Other expense
|
|
18,009
|
|
|
8,125
|
|
|
3,144
|
|
|
—
|
|
|
(5,294
|
)
|
|
23,984
|
|
||||||
Total operating expenses
|
|
41,670
|
|
|
37,903
|
|
|
11,307
|
|
|
—
|
|
|
(6,907
|
)
|
|
83,973
|
|
||||||
Income (loss) from continuing operations, before income taxes
|
|
14,396
|
|
|
5,016
|
|
|
(6,057
|
)
|
|
—
|
|
|
—
|
|
|
13,355
|
|
||||||
Income tax expense (benefit) - continuing operations
|
|
4,496
|
|
|
1,954
|
|
|
(2,072
|
)
|
|
—
|
|
|
—
|
|
|
4,378
|
|
||||||
Net income (loss) from continuing operations
|
|
9,900
|
|
|
3,062
|
|
|
(3,985
|
)
|
|
—
|
|
|
—
|
|
|
8,977
|
|
||||||
Income (loss) from discontinued operations
|
|
—
|
|
|
—
|
|
|
6,926
|
|
|
(580
|
)
|
|
—
|
|
|
6,346
|
|
||||||
Income tax expense (benefit) - discontinued operations
|
|
—
|
|
|
—
|
|
|
2,629
|
|
|
(218
|
)
|
|
—
|
|
|
2,411
|
|
||||||
Net income (loss) from discontinued operations
|
|
—
|
|
|
—
|
|
|
4,297
|
|
|
(362
|
)
|
|
—
|
|
|
3,935
|
|
||||||
Net income (loss)
|
|
$
|
9,900
|
|
|
$
|
3,062
|
|
|
$
|
312
|
|
|
$
|
(362
|
)
|
|
$
|
—
|
|
|
$
|
12,912
|
|
Preferred stock dividends
|
|
—
|
|
|
—
|
|
|
1,128
|
|
|
—
|
|
|
—
|
|
|
1,128
|
|
||||||
Net income (loss) available to common shareholders
|
|
$
|
9,900
|
|
|
$
|
3,062
|
|
|
$
|
(816
|
)
|
|
$
|
(362
|
)
|
|
$
|
—
|
|
|
$
|
11,784
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Capital Expenditures for the year ended December 31, 2016
|
|
$
|
1,145
|
|
|
$
|
220
|
|
|
$
|
303
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,668
|
|
Total Assets as of December 31, 2016
|
|
1,415,735
|
|
|
122,242
|
|
|
180,340
|
|
|
—
|
|
|
(299,513
|
)
|
|
1,418,804
|
|
||||||
Goodwill as of December 31, 2016
|
|
1,598
|
|
|
16,882
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18,480
|
|
|
|
2015
|
||||||||||||||||||||||
(Dollars in thousands)
|
|
Commercial & Retail Banking
|
|
Mortgage Banking
|
|
Financial Holding Company
|
|
Insurance
|
|
Intercompany Eliminations
|
|
Consolidated
|
||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest income
|
|
$
|
40,524
|
|
|
$
|
3,882
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
(308
|
)
|
|
$
|
44,100
|
|
Mortgage fee income
|
|
7
|
|
|
30,560
|
|
|
—
|
|
|
—
|
|
|
(1,095
|
)
|
|
29,472
|
|
||||||
Insurance and investment services income
|
|
338
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
338
|
|
|||||||
Other income
|
|
3,721
|
|
|
1,673
|
|
|
4,331
|
|
|
—
|
|
|
(4,580
|
)
|
|
5,145
|
|
||||||
Total operating income
|
|
44,590
|
|
|
36,115
|
|
|
4,333
|
|
|
—
|
|
|
(5,983
|
)
|
|
79,055
|
|
||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest expense
|
|
6,776
|
|
|
1,647
|
|
|
2,204
|
|
|
—
|
|
|
(1,402
|
)
|
|
9,225
|
|
||||||
Salaries and employee benefits
|
|
11,049
|
|
|
20,774
|
|
|
4,250
|
|
|
—
|
|
|
—
|
|
|
36,073
|
|
||||||
Provision for loan losses
|
|
2,493
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,493
|
|
||||||
Other expense
|
|
16,132
|
|
|
7,471
|
|
|
2,534
|
|
|
—
|
|
|
(4,362
|
)
|
|
21,775
|
|
||||||
Total operating expenses
|
|
36,450
|
|
|
29,892
|
|
|
8,988
|
|
|
—
|
|
|
(5,764
|
)
|
|
69,566
|
|
||||||
Income (loss) from continuing operations, before income taxes
|
|
8,140
|
|
|
6,223
|
|
|
(4,655
|
)
|
|
—
|
|
|
(219
|
)
|
|
9,489
|
|
||||||
Income tax expense (benefit) - continuing operations
|
|
2,176
|
|
|
2,394
|
|
|
(1,597
|
)
|
|
—
|
|
|
(87
|
)
|
|
2,886
|
|
||||||
Net income (loss) from continuing operations
|
|
5,964
|
|
|
3,829
|
|
|
(3,058
|
)
|
|
—
|
|
|
(132
|
)
|
|
6,603
|
|
||||||
Income (loss) from discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
134
|
|
|
219
|
|
|
353
|
|
||||||
Income tax expense (benefit) - discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
53
|
|
|
87
|
|
|
140
|
|
||||||
Net income (loss) from discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
81
|
|
|
132
|
|
|
213
|
|
||||||
Net income (loss)
|
|
$
|
5,964
|
|
|
$
|
3,829
|
|
|
$
|
(3,058
|
)
|
|
$
|
81
|
|
|
$
|
—
|
|
|
$
|
6,816
|
|
Preferred stock dividends
|
|
—
|
|
|
—
|
|
|
575
|
|
|
—
|
|
|
—
|
|
|
575
|
|
||||||
Net income (loss) available to common shareholders
|
|
$
|
5,964
|
|
|
$
|
3,829
|
|
|
$
|
(3,633
|
)
|
|
$
|
81
|
|
|
$
|
—
|
|
|
$
|
6,241
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Capital Expenditures for the year ended December 31, 2015
|
|
$
|
1,174
|
|
|
$
|
354
|
|
|
$
|
616
|
|
|
$
|
9
|
|
|
$
|
—
|
|
|
$
|
2,153
|
|
Total Assets as of December 31, 2015
|
|
1,378,988
|
|
|
125,227
|
|
|
148,509
|
|
|
5,017
|
|
|
(273,265
|
)
|
|
1,384,476
|
|
||||||
Goodwill as of December 31, 2015
|
|
1,598
|
|
|
16,882
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18,480
|
|
|
|
|
|
|
|
|
|
|
|
Earnings Per Share
|
||||||||||||||
(Dollars in thousands)
|
|
Interest Income
|
|
Net Interest Income
|
|
Income Before Taxes
|
|
Net Income
|
|
Basic
|
|
Diluted
|
||||||||||||
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
First quarter
|
|
$
|
13,068
|
|
|
$
|
10,306
|
|
|
$
|
2,295
|
|
|
$
|
1,574
|
|
|
$
|
0.14
|
|
|
$
|
0.14
|
|
Second quarter
|
|
13,814
|
|
|
10,894
|
|
|
3,435
|
|
|
2,260
|
|
|
0.21
|
|
|
0.20
|
|
||||||
Third quarter
|
|
14,630
|
|
|
11,414
|
|
|
3,510
|
|
|
2,318
|
|
|
0.21
|
|
|
0.21
|
|
||||||
Fourth quarter
|
|
15,086
|
|
|
11,683
|
|
|
3,090
|
|
|
1,423
|
|
|
0.12
|
|
|
0.12
|
|
|
|
|
|
|
|
|
|
|
|
Earnings Per Share
|
||||||||||||||
(Dollars in thousands)
|
|
Interest Income
|
|
Net Interest Income
|
|
Income Before Taxes
|
|
Net Income
|
|
Basic
|
|
Diluted
|
||||||||||||
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
First quarter
|
|
$
|
13,382
|
|
|
$
|
10,695
|
|
|
$
|
2,612
|
|
|
$
|
1,796
|
|
|
$
|
0.20
|
|
|
$
|
0.20
|
|
Second quarter
|
|
13,580
|
|
|
10,742
|
|
|
10,228
|
|
|
6,499
|
|
|
0.77
|
|
|
0.63
|
|
||||||
Third quarter
|
|
13,523
|
|
|
10,729
|
|
|
3,441
|
|
|
2,310
|
|
|
0.25
|
|
|
0.24
|
|
||||||
Fourth quarter
|
|
13,638
|
|
|
10,825
|
|
|
3,420
|
|
|
2,307
|
|
|
0.23
|
|
|
0.22
|
|
Date:
|
3/8/2018
|
|
/s/ Larry F. Mazza
|
|
|
|
Larry F. Mazza
|
|
|
|
President, CEO and Director
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
Date:
|
3/8/2018
|
|
/s/ Donald T. Robinson
|
|
|
|
Donald T. Robinson
|
|
|
|
Executive Vice President and CFO
|
|
|
|
(Principal Financial and Accounting Officer)
|
(a)(1)
|
Financial Statements
|
|
Management’s Annual Report on Internal Control over Financial Reporting
|
|
Report of Independent Registered Public Accounting Firm on Internal Control over Financial Reporting
|
|
Report of Independent Registered Public Accounting Firm - Dixon Hughes Goodman LLP
|
|
Consolidated Balance Sheets at December 31, 2017 and 2016
|
|
Consolidated Statements of Income for the years ended December 31, 2017, 2016, and 2015
|
|
Consolidated Statements of Comprehensive Income for the years ended December 31, 2017, 2016, and 2015
|
|
Consolidated Statements of Changes in Stockholders’ Equity for the years ended December 31, 2017, 2016, and 2015
|
|
Consolidated Statements of Cash Flows for the years ended December 31, 2017, 2016, and 2015
|
|
Notes to Consolidated Financial Statements
|
|
|
(b)
|
Exhibits
|
|
Exhibits filed with this Annual Report on Form 10-K are attached hereto. For a list of such exhibits, see “Exhibit Index” below. The Exhibit Index specifically identifies each management contract or compensatory plan required to be filed as an exhibit to this Form 10-K.
|
SIGNATURES
|
|||
|
|||
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
|||
|
|
||
|
MVB Financial Corp.
|
||
|
|
|
|
Date:
|
3/8/2018
|
By:
|
/s/ Larry F. Mazza
|
|
|
Larry F. Mazza
|
|
|
|
President, CEO and Director
|
|
|
|
(Principal Executive Officer)
|
POWER OF ATTORNEY AND SIGNATURES
|
|||
|
|||
Know all persons by the presents, that each person whose signature appears below constitutes and appoints Larry F. Mazza or Donald T. Robinson or either of them, as attorney-in-fact, with each having the power of substitution, for him or her in any and all capacities, to sign any amendment to this Form 10-K and to file the same, with exhibits thereto, and other documents in connection therewith, with the Federal Deposit Insurance Corporation hereby ratifying and confirming all that each of said attorneys-in-fact or his substitute or substitutes may do or cause to be done by virtue hereof.
|
|||
|
|||
Pursuant to the requirements of the Securities and Exchange Act of 1934, this Form 10-K has been signed below by the following person on behalf of the registrant in the capacities and on the dates indicated.
|
|||
|
|||
/s/ Larry F. Mazza
|
|
Date:
|
3/8/2018
|
Larry F. Mazza, President, CEO and Director
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
|
/s/ Donald T. Robinson
|
|
Date:
|
3/8/2018
|
Donald T. Robinson, Executive Vice President and CFO
|
|
|
|
(Principal Financial and Accounting Officer)
|
|
|
|
|
|
|
|
/s/ Stephen R. Brooks
|
|
Date:
|
3/8/2018
|
Stephen R. Brooks, Chairman
|
|
|
|
|
|
|
|
/s/ David B. Alvarez
|
|
Date:
|
3/8/2018
|
David B. Alvarez, Vice Chairman
|
|
|
|
|
|
|
|
/s/ James J. Cava, Jr.
|
|
Date:
|
3/8/2018
|
James J. Cava, Jr., Director
|
|
|
|
|
|
|
|
/s/ Harry E. Dean III
|
|
Date:
|
3/8/2018
|
Harry E. Dean III, Director
|
|
|
|
|
|
|
|
/s/ John W. Ebert
|
|
Date:
|
3/8/2018
|
John W. Ebert, Director
|
|
|
|
|
|
|
|
/s/ Daniel W. Holt
|
|
Date:
|
3/8/2018
|
Daniel W. Holt, Director
|
|
|
|
|
|
|
|
/s/ Gary A. LeDonne
|
|
Date:
|
3/8/2018
|
Gary A. LeDonne, Director
|
|
|
|
|
|
|
|
/s/ Kelly R. Nelson
|
|
Date:
|
3/8/2018
|
Kelly R. Nelson, Director
|
|
|
|
|
|
|
|
/s/ J. Christopher Pallotta
|
|
Date:
|
3/8/2018
|
J. Christopher Pallotta, Director
|
|
|
|
EXHIBIT INDEX
|
||||
31.2
|
|
Certificate of Principal Financial Officer pursuant to Section 302 of Sarbanes Oxley Act of 2002
|
|
|
32.1*
|
|
Certificate of Principal Executive Officer & Principal Financial Officer pursuant to Section 906 of Sarbanes Oxley Act of 2002
|
|
|
101
|
|
Interactive data files pursuant to Rule 405 of Regulation S-T
|
|
Filed herewith
|
Earnings Per Share
Earnings per Share are calculated as follows:
|
||||||||||||
|
|
For the years ended
|
||||||||||
|
|
December 31,
|
||||||||||
(Dollars in thousands except shares and per share data)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Numerator for basic earnings per share:
|
|
|
|
|
|
|
||||||
Net Income from continuing operations
|
|
$
|
7,575
|
|
|
$
|
8,977
|
|
|
$
|
6,603
|
|
Less: Dividends on preferred stock
|
|
498
|
|
|
1,128
|
|
|
575
|
|
|||
Net Income from continuing operations available to common shareholders - basic
|
|
7,077
|
|
|
7,849
|
|
|
6,028
|
|
|||
Net Income from discontinued operations available to common shareholders - basic and diluted
|
|
—
|
|
|
3,935
|
|
|
213
|
|
|||
Net Income available to common shareholders
|
|
$
|
7,077
|
|
|
$
|
11,784
|
|
|
$
|
6,241
|
|
|
|
|
|
|
|
|
||||||
Numerator for diluted earnings per share:
|
|
|
|
|
|
|
||||||
Net Income from continuing operations available to common shareholders - basic
|
|
$
|
7,077
|
|
|
$
|
7,849
|
|
|
$
|
6,028
|
|
Add: Dividends on preferred stock
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Add: Interest on subordinated debt (tax effected)
|
|
—
|
|
|
1,390
|
|
|
—
|
|
|||
Net Income available to common shareholders from continuing operations - diluted
|
|
$
|
7,077
|
|
|
$
|
9,239
|
|
|
$
|
6,028
|
|
|
|
|
|
|
|
|
||||||
Denominator:
|
|
|
|
|
|
|
|
|
|
|||
Total average shares outstanding
|
|
10,308,738
|
|
|
8,212,021
|
|
|
8,014,316
|
|
|||
Effect of dilutive convertible preferred stock
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Effect of dilutive convertible subordinated debt
|
|
—
|
|
|
1,837,500
|
|
|
—
|
|
|||
Effect of dilutive stock options
|
|
131,490
|
|
|
19,212
|
|
|
125,800
|
|
|||
Total diluted average shares outstanding
|
|
10,440,228
|
|
|
10,068,733
|
|
|
8,140,116
|
|
|||
|
|
|
|
|
|
|
||||||
Earnings per share from continuing operations - basic
|
|
$
|
0.69
|
|
|
$
|
0.96
|
|
|
$
|
0.75
|
|
Earnings per share from discontinued operations - basic
|
|
$
|
—
|
|
|
$
|
0.48
|
|
|
$
|
0.03
|
|
Earnings per common shareholder - basic
|
|
$
|
0.69
|
|
|
$
|
1.44
|
|
|
$
|
0.78
|
|
|
|
|
|
|
|
|
||||||
Earnings per share from continuing operations - diluted
|
|
$
|
0.68
|
|
|
$
|
0.92
|
|
|
$
|
0.74
|
|
Earnings per share from discontinued operations - diluted
|
|
$
|
—
|
|
|
$
|
0.39
|
|
|
$
|
0.03
|
|
Earnings per common shareholder - diluted
|
|
$
|
0.68
|
|
|
$
|
1.31
|
|
|
$
|
0.77
|
|
1.
|
Each Covered Person must avoid any transaction or arrangement that would create a conflict of interest or the appearance of a conflict of interest between personal and professional relationships.
|
2.
|
Covered Persons may only accept items of nominal value as gifts from any individual or entity that is involved or seeks to become involved in a business relationship with MVB.
|
•
|
Is valued at $100 or less;
|
•
|
Is not intended to influence any decision by us;
|
•
|
Is unsolicited;
|
•
|
Is infrequent; and
|
•
|
Is not a quid pro quo.
|
3.
|
All Covered Persons are responsible for maintaining accurate financial records for MVB.
|
(i)
|
All assets, liabilities and transactions of MVB should be accurately recorded in accordance with MVB’s record keeping procedures and generally accepted accounting principles;
|
(ii)
|
No false or misleading entries are permitted to be knowingly made or caused to be made in MVB’s record books, even if such entries would not be material to MVB or its operations as a whole; and
|
(iii)
|
Any entries that are inaccurate, false or irregular should be promptly reported to a member of the Audit Committee for an immediate corrective action.
|
4.
|
Covered Persons must recognize that confidential information is an asset of MVB, and must refrain from using inside information to their personal advantage.
|
5.
|
The conduct of Covered Persons should be governed by the highest standards of integrity and fairness.
|
(i)
|
Ownership by a Covered Person, or a member of his or her immediate family, of a material financial interest in any outside enterprise that is involved or seeks to become involved in a business relationship with MVB;
|
(ii)
|
Ownership by a Covered Person, or a member of his or her immediate family, of a material financial interest in any outside enterprise that competes for business with MVB;
|
(iii)
|
Outside employment of a Covered Person, or a member of his or her immediate
|
(iv)
|
Appointment of a Covered Person, or a member of his or her immediate family, to a public office, board or commission that may create an appearance of a conflict of interest between the goals and purposes of that organization and MVB business. Such appointment would include a “public service” organization or a not-for-profit organization.
|
6.
|
Covered Persons must not take for themselves opportunities that they discover while working for MVB, or use corporate property or information for personal gain.
|
7.
|
In drafting periodic reports that are to be filed with the Securities and Exchange Commission, Covered Persons should take all steps necessary to ensure full, fair, accurate, timely and complete disclosure.
|
(i)
|
Go Beyond the Minimum Disclosure Required by Law
. While in the past periodic reporting has focused on disclosing only those items that were mandated by the law, Covered Persons should go beyond the minimum requirements to convey the full financial picture of MVB to the public.
|
(ii)
|
Make Sure All Relationships that Could Give Rise to Any Perceived Conflicts are Fully Disclosed
. Given the recent focus of lawmakers on a more complete disclosure of any material conflict of interest to the public, it is important to ensure that any transaction that threatens to create the appearance of a conflict of interest must be fully disclosed in MVB’s periodic reports.
|
8.
|
Covered Persons must comply with all laws and regulations that apply to MVB’s business.
|
9.
|
Accountability for adherence to the Code.
|
Name of Subsidiary
|
|
Jurisdiction of Incorporation
|
MVB Bank Inc.
|
|
West Virginia
|
Potomac Mortgage Group, Inc., (D/B/A MVB Mortgage)
|
|
Virginia
|
MVB Insurance, LLC
|
|
West Virginia
|
MVB Community Development Corporation
|
|
West Virginia
|
1.
|
I have reviewed this annual report on Form 10-K of MVB Financial Corp.;
|
2.
|
Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted account principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
3/8/2018
|
|
/s/ Larry F. Mazza
|
|
|
|
Larry F. Mazza
|
|
|
|
President, CEO and Director
|
|
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this annual report on Form 10-K of MVB Financial Corp.;
|
2.
|
Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted account principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
3/8/2018
|
|
/s/ Donald T. Robinson
|
|
|
|
Donald T. Robinson
|
|
|
|
Executive Vice President and CFO
|
|
|
|
(Principal Financial and Accounting Officer)
|
1.
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
MVB Financial Corp.
|
|||||
|
|||||
By:
|
/s/ Larry F. Mazza
|
|
/s/ Donald T. Robinson
|
||
|
Larry F. Mazza
|
|
Donald T. Robinson
|
||
|
President, CEO and Director
|
|
Executive Vice President and CFO
|
||
|
(Principal Executive Officer)
|
|
(Principal Financial and Accounting Officer)
|
||
|
|||||
|
Date:
|
3/8/2018
|
|
Date:
|
3/8/2018
|