þ
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the fiscal year ended December 31, 2018
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from to
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Wisconsin
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39-1576570
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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401 Charmany Drive, Madison, WI
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53719
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
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Name of each exchange on which registered
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Common Stock, $0.01 par value
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The Nasdaq Stock Market LLC
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Common Share Purchase Rights
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The Nasdaq Stock Market LLC
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Large accelerated filer
o
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Accelerated filer
þ
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Non-accelerated filer
o
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Smaller reporting company
o
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Emerging growth company
o
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(Do not check if a smaller reporting company)
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•
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FBCC is an asset-based lending company specializing in providing lines of credit, factored receivable financing and term loans secured by accounts receivable, inventory, equipment, and real estate assets, primarily to manufacturers and wholesale distribution companies located throughout the country, with a concentration in the Midwest. FBCC was established in 1995 and has sales offices in several states.
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•
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FBEF is a commercial equipment finance company offering a full array of financing options to commercial clients of which the largest percentage are currently located in Wisconsin. It offers new and replacement equipment loans and leases, debt restructuring, consolidation, and sale-lease-back transactions through its primary banking locations in Wisconsin. FBEF was established in 1998.
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•
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Rimrock Road Investment Fund, LLC (“Rimrock”), established in 2009 and formerly known as FBB Real Estate, LLC, is a limited liability company originally established for the purpose of holding and liquidating real estate and other assets acquired by FBB through foreclosure or other legal proceedings. In 2014, Rimrock’s purpose was
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•
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BOC Investment, LLC (“BOC”), is a limited liability company established for the purpose of capturing federal historic tax credits to reduce the cost of borrowing for a FBB client engaged in rehabilitating a historic building in Madison, Wisconsin. BOC was established in 2015.
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•
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Mitchell Street Apartments Investment, LLC (“Mitchell”), is a limited liability company established for the purpose of capturing federal and state historic tax credits to reduce the cost of borrowing for a FBB client engaged in rehabilitating a historic building in Milwaukee, Wisconsin. Mitchell was established in 2016.
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•
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ABKC Real Estate, LLC (“ABKCRE”), is a limited liability company established for the purpose of holding and liquidating real estate and other assets acquired by FBB through foreclosure or other legal proceedings. ABKCRE was established in 2017.
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•
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FBB Real Estate 2, LLC (“FBB RE 2”), is a limited liability company established for the purpose of holding and liquidating real estate and other assets acquired by FBB through foreclosure or other legal proceedings. FBB RE 2 was established in 2018.
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•
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FBB Tax Credit Investment, LLC (“FBB Tax Credit”), established in 2012 and formerly known as FBB-Milwaukee Real Estate, LLC (“FBBMRE”), is a limited liability company originally established for the purpose of holding and liquidating real estate and other assets acquired by FBB through foreclosure or other legal proceedings. In 2017, FBB Tax Credit’s purpose was changed to facilitate investments in federal and state tax credits.
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•
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First Madison Investment Corp. (“FMIC”) is located in and formed under the laws of the State of Nevada, and was organized for the purpose of managing a portion of FBB’s investment portfolio. FMIC was established in 1993.
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•
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A ratio of minimum Common Equity Tier 1 Capital equal to 4.5% of risk-weighted assets;
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•
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An increase in the minimum required amount of Tier 1 Capital from 4% to 6% of risk-weighted assets;
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•
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A continuation of the minimum required amount of Total Capital (Tier 1 plus Tier 2) at 8% of risk-weighted assets; and
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•
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A minimum leverage ratio of Tier 1 Capital to total quarterly average assets equal to 4% in all circumstances.
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•
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A Common Equity Tier 1 Capital ratio to risk-weighted assets of 6.5% or more;
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A ratio of Tier 1 Capital to total risk-weighted assets of 8% or more (6% under Basel I);
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•
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A ratio of Total Capital to total risk-weighted assets of 10% or more (the same as Basel I); and
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•
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A leverage ratio of Tier 1 Capital to total adjusted average quarterly assets of 5% or greater.
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Potential exposure to unknown or contingent liabilities of the target company.
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Exposure to potential asset quality issues of the target company.
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Potential disruption to our business.
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Potential diversion of our management’s time and attention.
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•
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Possible loss of key employees and clients of the target company.
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Difficulty in estimating the value of the target company.
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•
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Potential changes in banking or tax laws or regulations that may affect the target company.
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Difficulty in integrating operations, personnel, technologies, services, and products of acquired companies.
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•
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actual or anticipated variations in our quarterly results of operations;
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•
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recommendations by securities analysts;
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•
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operating and stock price performance of other companies that investors deem comparable to us;
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•
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news reports relating to trends, concerns and other issues in the financial services industry;
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•
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perceptions in the marketplace regarding us or our competitors and other financial services companies;
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•
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new technology used, or services offered, by competitors; and
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•
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changes in government regulations.
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Location
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Function
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Expiration
Date
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401 Charmany Drive, Madison, WI
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Full-service banking location of FBB and office of FBFS
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2028
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18500 W. Corporate Drive, Brookfield, WI
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Full-service banking location of FBB - Milwaukee Region
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2020
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11300 Tomahawk Creek Pkwy, Leawood, KS
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Full-service banking location of FBB - Kansas City Region
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2023
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3913 West Prospect Avenue, Appleton, WI
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Full-service banking location of FBB - Northeast Region
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2025
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As of December 31,
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||||||||||||||||||||||
Index
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2013
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2014
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2015
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2016
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2017
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2018
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||||||||||||
First Business Financial Services, Inc.
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$
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100.00
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$
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129.80
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$
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138.15
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$
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133.96
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$
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127.77
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$
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115.43
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Nasdaq Composite
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100.00
|
|
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114.75
|
|
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122.74
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133.62
|
|
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173.22
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|
|
168.30
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||||||
SNL Bank Nasdaq
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100.00
|
|
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103.57
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|
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111.80
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|
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155.02
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|
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163.20
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|
|
137.56
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Period
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Total Number of Shares Purchased
(1)
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Average Price Paid Per Share
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Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
(2)
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Total Number of Shares that May Yet Be Purchased Under the Plans or Programs
(3)
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|||||
October 1, 2018 - October 31, 2018
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—
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$
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—
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—
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—
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November 1, 2018 - November 30, 2018
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956
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20.76
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—
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—
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December 1, 2018 - December 31, 2018
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11,920
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19.69
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11,920
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—
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Total
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12,876
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11,920
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244,250
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(1)
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During the fourth quarter of 2018, the Corporation repurchased an aggregate
12,876
shares of the Corporation’s common stock in open-market transactions, of which
11,920
shares were purchased pursuant to the repurchase program publicly announced on December 14, 2018, and of which
956
shares were surrendered to us to satisfy income tax withholding obligations in connection with the vesting of restricted shares.
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(2)
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As of December 31, 2018, an aggregate of
11,920
shares were purchased for a total of
$234,681
since the inception of the repurchase program announced on December 14, 2018.
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(3)
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As of December 31, 2018, the maximum number of shares that may yet be purchased under the plan is
244,250
based on the closing price of the Corporation’s common stock on December 31, 2018 of
$19.51
per share.
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As of and for the Year Ended December 31,
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||||||||||||||||||
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2018
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2017
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2016
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2015
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2014
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||||||||||
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(Dollars in Thousands, Except Share and Per Share Data)
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||||||||||||||||||
INCOME STATEMENT:
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||||||||||
Interest income
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$
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91,275
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$
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75,811
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$
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78,117
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$
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72,471
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$
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57,701
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Interest expense
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23,933
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|
|
15,202
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14,789
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13,831
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11,571
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|||||
Net interest income
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67,342
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60,609
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63,328
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58,640
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46,130
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|||||
Provision for loan and lease losses
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5,492
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6,172
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7,818
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3,386
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1,236
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|||||
Non-interest income
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18,167
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16,665
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17,988
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17,011
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10,103
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|||||
Non-interest expense
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62,363
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56,871
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56,433
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47,374
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33,775
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|||||
Income tax expense
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1,351
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2,326
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2,156
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8,377
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|
7,083
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|||||
Net income
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$
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16,303
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$
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11,905
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$
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14,909
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$
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16,514
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$
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14,139
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Yield on earning assets
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5.04
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%
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4.47
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%
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4.50
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%
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4.52
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%
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4.45
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%
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|||||
Cost of funds
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1.63
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%
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1.11
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%
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1.06
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%
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1.04
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%
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1.07
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%
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|||||
Interest rate spread
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3.41
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%
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3.36
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%
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3.44
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%
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3.48
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%
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3.38
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%
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|||||
Net interest margin
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3.72
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%
|
|
3.58
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%
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3.64
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%
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3.66
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%
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3.56
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%
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|||||
Return on average assets
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0.86
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%
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|
0.67
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%
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|
0.82
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%
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0.97
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%
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|
1.04
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%
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|||||
Return on average equity
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9.41
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%
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7.16
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%
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9.40
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%
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11.36
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%
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|
11.78
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%
|
|||||
ENDING BALANCE SHEET:
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|
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|
|
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|
|
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|
||||||||||
Total assets
|
|
$
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1,966,457
|
|
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$
|
1,794,066
|
|
|
$
|
1,780,699
|
|
|
$
|
1,782,081
|
|
|
$
|
1,628,505
|
|
Securities
|
|
176,089
|
|
|
163,783
|
|
|
184,505
|
|
|
177,830
|
|
|
186,261
|
|
|||||
Loans and leases, net of deferred loan fees
|
|
1,617,655
|
|
|
1,501,595
|
|
|
1,450,675
|
|
|
1,430,965
|
|
|
1,266,438
|
|
|||||
In-market deposits
|
|
1,179,448
|
|
|
1,086,346
|
|
|
1,122,174
|
|
|
1,089,748
|
|
|
1,010,928
|
|
|||||
Wholesale deposits
|
|
275,851
|
|
|
307,985
|
|
|
416,681
|
|
|
487,483
|
|
|
427,340
|
|
|||||
FHLB advances and other borrowings
|
|
298,944
|
|
|
207,898
|
|
|
59,676
|
|
|
34,740
|
|
|
33,451
|
|
|||||
Junior subordinated notes
|
|
10,033
|
|
|
10,019
|
|
|
10,004
|
|
|
9,990
|
|
|
9,976
|
|
|||||
Stockholders’ equity
|
|
180,707
|
|
|
169,278
|
|
|
161,650
|
|
|
150,832
|
|
|
137,748
|
|
|||||
FINANCIAL CONDITION ANALYSIS:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for loan and lease losses to gross loans and leases
|
|
1.26
|
%
|
|
1.25
|
%
|
|
1.44
|
%
|
|
1.14
|
%
|
|
1.12
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%
|
|||||
Allowance to non-accrual loans and leases
|
|
80.73
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%
|
|
71.10
|
%
|
|
83.00
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%
|
|
73.17
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%
|
|
146.33
|
%
|
|||||
Net charge-offs to average loans and leases
|
|
0.24
|
%
|
|
0.57
|
%
|
|
0.22
|
%
|
|
0.10
|
%
|
|
0.08
|
%
|
|||||
Non-accrual loans to gross loans and leases
|
|
1.56
|
%
|
|
1.76
|
%
|
|
1.74
|
%
|
|
1.56
|
%
|
|
0.76
|
%
|
|||||
Average equity to average assets
|
|
9.10
|
%
|
|
9.35
|
%
|
|
8.75
|
%
|
|
8.54
|
%
|
|
8.80
|
%
|
|||||
STOCKHOLDERS’ DATA:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic earnings per common share
(1)
|
|
$
|
1.86
|
|
|
$
|
1.36
|
|
|
$
|
1.71
|
|
|
$
|
1.90
|
|
|
$
|
1.76
|
|
Diluted earnings per common share
(1)
|
|
1.86
|
|
|
1.36
|
|
|
1.71
|
|
|
1.90
|
|
|
1.75
|
|
|||||
Book value per share at end of period
|
|
20.57
|
|
|
19.32
|
|
|
18.55
|
|
|
17.34
|
|
|
15.88
|
|
|||||
Tangible book value per share at end of period
|
|
19.20
|
|
|
17.87
|
|
|
17.08
|
|
|
15.90
|
|
|
14.51
|
|
|||||
Dividend declared per share
|
|
0.56
|
|
|
0.52
|
|
|
0.48
|
|
|
0.44
|
|
|
0.42
|
|
|||||
Dividend payout ratio
|
|
30.15
|
%
|
|
38.12
|
%
|
|
23.93
|
%
|
|
23.93
|
%
|
|
23.93
|
%
|
|||||
Shares outstanding
|
|
8,785,480
|
|
|
8,763,539
|
|
|
8,715,856
|
|
|
8,699,410
|
|
|
8,671,854
|
|
(1)
|
Basic and diluted earnings per share reflect earnings per common share as calculated under the two-class method due to the existence of participating securities. All shares and per share amounts have been adjusted to reflect the 2-for-1 stock split in the form of a 100% stock dividend completed in August 2015.
|
Item 7.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
•
|
Competitive pressures among depository and other financial institutions nationally and in our markets.
|
•
|
Adverse changes in the economy or business conditions, either nationally or in our markets.
|
•
|
Increases in defaults by borrowers and other delinquencies.
|
•
|
Our ability to manage growth effectively, including the successful expansion of our client support, administrative infrastructure and internal management systems.
|
•
|
Fluctuations in interest rates and market prices.
|
•
|
The consequences of continued bank acquisitions and mergers in our markets, resulting in fewer but much larger and financially stronger competitors.
|
•
|
Changes in legislative or regulatory requirements applicable to us and our subsidiaries.
|
•
|
Changes in tax requirements, including tax rate changes, new tax laws and revised tax law interpretations.
|
•
|
Fraud, including client and system failure or breaches of our network security, including our internet banking activities.
|
•
|
Failure to comply with the applicable SBA regulations in order to maintain the eligibility of the guaranteed portions of SBA loans.
|
•
|
Total assets at
December 31, 2018
increased
$172.4 million
, or
9.6%
, to
$1.966 billion
from
$1.794 billion
at
December 31, 2017
.
|
•
|
Net income for the year ended
December 31, 2018
was
$16.3 million
, increasing
36.9%
compared to
$11.9 million
for the year ended
December 31, 2017
.
|
•
|
Diluted earnings per common share were
$1.86
for the year ended
December 31, 2018
, increasing
36.7%
compared to
$1.36
in the prior year.
|
•
|
Net interest margin was
3.72%
for the year ended
December 31, 2018
,
increasing
14
basis points from
3.58%
for the year ended
December 31, 2017
.
|
•
|
Top line revenue, which consists of net interest income and non-interest income,
grew
10.7%
to
$85.5 million
for the year ended
December 31, 2018
, compared to
$77.3 million
for the same period in
2017
.
|
•
|
Return on average assets and return on average equity for the year ended
December 31, 2018
were
0.86%
and
9.41%
respectively, compared to
0.67%
and
7.16%
, respectively, for
2017
.
|
•
|
Provision for loan and lease losses was
$5.5 million
for the year ended
December 31, 2018
, compared to
$6.2 million
for the year ended
December 31, 2017
.
|
•
|
SBA recourse provision was
$1.9 million
for the year ended
December 31, 2018
, compared to
$2.2 million
for the year ended
December 31, 2017
.
|
•
|
Period-end gross loans and leases receivable at
December 31, 2018
increased
$116.1 million
, or
7.7%
, to
$1.618 billion
from
$1.502 billion
as of
December 31, 2017
.
|
•
|
Non-performing assets were
$27.8 million
and
1.42%
of total assets as of
December 31, 2018
, compared to
$27.5 million
and
1.53%
of total assets as of
December 31, 2017
.
|
•
|
Net charge-offs as a percentage of average loans and leases decreased to
0.24%
for the year ended
December 31, 2018
, compared to
0.57%
for the year ended
December 31, 2017
.
|
•
|
Trust assets under management and administration
increased
by
$93.9 million
, or
6.1%
, to
$1.630 billion
at
December 31, 2018
compared to
$1.536 billion
at
December 31, 2017
.
|
•
|
Trust and investment service fee income
increased
by
$1.1 million
, or
16.1%
, to
$7.7 million
for the year ended
December 31, 2018
compared to
$6.7 million
for the year ended
December 31, 2017
.
|
•
|
Period-end in-market deposits at
December 31, 2018
increased
$93.1 million
, or
8.6%
, to
$1.179 billion
from
$1.086 billion
as of
December 31, 2017
.
|
|
|
For the Year Ended December 31,
|
|
Change From Prior Year
|
||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
$ Change 2018
|
|
% Change 2018
|
|
$ Change 2017
|
|
% Change 2017
|
||||||||||||
|
|
(Dollars in Thousands)
|
||||||||||||||||||||||||
Net interest income
|
|
$
|
67,342
|
|
|
$
|
60,609
|
|
|
$
|
63,328
|
|
|
$
|
6,733
|
|
|
11.1
|
%
|
|
$
|
(2,719
|
)
|
|
(4.3
|
)%
|
Non-interest income
|
|
18,167
|
|
|
16,665
|
|
|
17,988
|
|
|
1,502
|
|
|
9.0
|
|
|
(1,323
|
)
|
|
(7.4
|
)
|
|||||
Top line revenue
|
|
$
|
85,509
|
|
|
$
|
77,274
|
|
|
$
|
81,316
|
|
|
$
|
8,235
|
|
|
10.7
|
|
|
$
|
(4,042
|
)
|
|
(5.0
|
)
|
|
|
For the Year Ended December 31,
|
|
Change From Prior Year
|
||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
$ Change 2018
|
|
% Change 2018
|
|
$ Change 2017
|
|
% Change 2017
|
||||||||||||
|
|
(Dollars in Thousands)
|
||||||||||||||||||||||||
Total non-interest expense
|
|
$
|
62,363
|
|
|
$
|
56,871
|
|
|
$
|
56,433
|
|
|
$
|
5,492
|
|
|
9.7
|
%
|
|
$
|
438
|
|
|
0.8
|
%
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net loss (gain) on foreclosed properties
|
|
367
|
|
|
(143
|
)
|
|
122
|
|
|
510
|
|
|
NM
|
|
|
(265
|
)
|
|
NM
|
|
|||||
Amortization of other intangible assets
|
|
47
|
|
|
54
|
|
|
62
|
|
|
(7
|
)
|
|
(13.0
|
)
|
|
(8
|
)
|
|
(12.9
|
)%
|
|||||
SBA recourse provision
|
|
1,913
|
|
|
2,240
|
|
|
2,068
|
|
|
(327
|
)
|
|
(14.6
|
)
|
|
172
|
|
|
8.3
|
%
|
|||||
Impairment of tax credit investments
|
|
2,083
|
|
|
2,784
|
|
|
3,691
|
|
|
(701
|
)
|
|
(25.2
|
)
|
|
(907
|
)
|
|
(24.6
|
)%
|
|||||
Deconversion fees
|
|
—
|
|
|
300
|
|
|
794
|
|
|
(300
|
)
|
|
(100.0
|
)
|
|
(494
|
)
|
|
(62.2
|
)%
|
|||||
Total operating expense
|
|
$
|
57,953
|
|
|
$
|
51,636
|
|
|
$
|
49,696
|
|
|
$
|
6,317
|
|
|
12.2
|
|
|
$
|
1,940
|
|
|
3.9
|
|
Net interest income
|
|
$
|
67,342
|
|
|
$
|
60,609
|
|
|
$
|
63,328
|
|
|
$
|
6,733
|
|
|
11.1
|
|
|
$
|
(2,719
|
)
|
|
(4.3
|
)
|
Total non-interest income
|
|
18,167
|
|
|
16,665
|
|
|
17,988
|
|
|
1,502
|
|
|
9.0
|
|
|
(1,323
|
)
|
|
(7.4
|
)
|
|||||
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net (loss) gain on sale of securities
|
|
(4
|
)
|
|
(403
|
)
|
|
10
|
|
|
399
|
|
|
(99.0
|
)
|
|
(413
|
)
|
|
NM
|
|
|||||
Total operating revenue
|
|
$
|
85,513
|
|
|
$
|
77,677
|
|
|
$
|
81,306
|
|
|
$
|
7,836
|
|
|
10.1
|
|
|
$
|
(3,629
|
)
|
|
(4.5
|
)
|
Efficiency ratio
|
|
67.77
|
%
|
|
66.48
|
%
|
|
61.12
|
%
|
|
|
|
|
|
|
|
|
|
|
For the Year Ended December 31,
|
|||||||||||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|||||||||||||||||||||||||||
|
|
Average
Balance
|
|
Interest
|
|
Average
Yield/
Rate
|
|
Average
Balance
|
|
Interest
|
|
Average
Yield/
Rate
|
|
Average
Balance
|
|
Interest
|
|
Average
Yield/
Rate
|
|||||||||||||||
|
|
(Dollars in Thousands)
|
|||||||||||||||||||||||||||||||
Interest-earning assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Commercial real estate and other mortgage loans
(1)
|
|
$
|
1,074,873
|
|
|
$
|
53,620
|
|
|
4.99
|
%
|
|
$
|
961,572
|
|
|
$
|
43,452
|
|
|
4.52
|
%
|
|
$
|
938,524
|
|
|
$
|
43,927
|
|
|
4.68
|
%
|
Commercial and industrial loans
(1)
|
|
447,687
|
|
|
30,043
|
|
|
6.71
|
%
|
|
447,937
|
|
|
26,165
|
|
|
5.84
|
%
|
|
465,736
|
|
|
28,143
|
|
|
6.04
|
%
|
||||||
Direct financing leases
(1)
|
|
31,276
|
|
|
1,268
|
|
|
4.05
|
%
|
|
28,988
|
|
|
1,231
|
|
|
4.25
|
%
|
|
30,379
|
|
|
1,364
|
|
|
4.49
|
%
|
||||||
Consumer and other loans
(1)
|
|
29,761
|
|
|
1,297
|
|
|
4.36
|
%
|
|
27,612
|
|
|
1,112
|
|
|
4.03
|
%
|
|
25,615
|
|
|
1,193
|
|
|
4.66
|
%
|
||||||
Total loans and leases receivable
(1)
|
|
1,583,597
|
|
|
86,228
|
|
|
5.45
|
%
|
|
1,466,109
|
|
|
71,960
|
|
|
4.91
|
%
|
|
1,460,254
|
|
|
74,627
|
|
|
5.11
|
%
|
||||||
Mortgage-related securities
(2)
|
|
137,145
|
|
|
3,185
|
|
|
2.32
|
%
|
|
138,528
|
|
|
2,466
|
|
|
1.78
|
%
|
|
147,433
|
|
|
2,328
|
|
|
1.58
|
%
|
||||||
Other investment securities
(3)
|
|
33,929
|
|
|
657
|
|
|
1.94
|
%
|
|
37,085
|
|
|
682
|
|
|
1.84
|
%
|
|
32,995
|
|
|
517
|
|
|
1.57
|
%
|
||||||
FHLB and FRB stock
|
|
7,472
|
|
|
290
|
|
|
3.88
|
%
|
|
4,231
|
|
|
103
|
|
|
2.43
|
%
|
|
2,537
|
|
|
79
|
|
|
3.11
|
%
|
||||||
Short-term investments
|
|
49,365
|
|
|
915
|
|
|
1.85
|
%
|
|
49,113
|
|
|
600
|
|
|
1.22
|
%
|
|
94,548
|
|
|
566
|
|
|
0.60
|
%
|
||||||
Total interest-earning assets
|
|
1,811,508
|
|
|
91,275
|
|
|
5.04
|
%
|
|
1,695,066
|
|
|
75,811
|
|
|
4.47
|
%
|
|
1,737,767
|
|
|
78,117
|
|
|
4.50
|
%
|
||||||
Non-interest-earning assets
|
|
92,631
|
|
|
|
|
|
|
84,829
|
|
|
|
|
|
|
73,905
|
|
|
|
|
|
||||||||||||
Total assets
|
|
$
|
1,904,139
|
|
|
|
|
|
|
$
|
1,779,895
|
|
|
|
|
|
|
$
|
1,811,672
|
|
|
|
|
|
|||||||||
Interest-bearing liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Transaction accounts
|
|
$
|
269,943
|
|
|
2,671
|
|
|
0.99
|
%
|
|
$
|
226,540
|
|
|
1,335
|
|
|
0.59
|
%
|
|
$
|
169,571
|
|
|
456
|
|
|
0.27
|
%
|
|||
Money market
|
|
491,756
|
|
|
5,375
|
|
|
1.09
|
%
|
|
583,241
|
|
|
2,746
|
|
|
0.47
|
%
|
|
642,784
|
|
|
3,112
|
|
|
0.48
|
%
|
||||||
Certificates of deposit
|
|
94,172
|
|
|
1,599
|
|
|
1.70
|
%
|
|
56,667
|
|
|
569
|
|
|
1.00
|
%
|
|
65,608
|
|
|
592
|
|
|
0.90
|
%
|
||||||
Wholesale deposits
|
|
302,440
|
|
|
5,888
|
|
|
1.95
|
%
|
|
361,712
|
|
|
6,155
|
|
|
1.70
|
%
|
|
467,826
|
|
|
7,556
|
|
|
1.62
|
%
|
||||||
Total interest-bearing deposits
|
|
1,158,311
|
|
|
15,533
|
|
|
1.34
|
%
|
|
1,228,160
|
|
|
10,805
|
|
|
0.88
|
%
|
|
1,345,789
|
|
|
11,716
|
|
|
0.87
|
%
|
||||||
FHLB advances
|
|
274,382
|
|
|
5,640
|
|
|
2.06
|
%
|
|
105,276
|
|
|
1,472
|
|
|
1.40
|
%
|
|
14,485
|
|
|
140
|
|
|
0.97
|
%
|
||||||
Other borrowings
|
|
24,537
|
|
|
1,648
|
|
|
6.72
|
%
|
|
24,796
|
|
|
1,813
|
|
|
7.31
|
%
|
|
26,463
|
|
|
1,818
|
|
|
6.87
|
%
|
||||||
Junior subordinated notes
|
|
10,025
|
|
|
1,112
|
|
|
11.09
|
%
|
|
10,011
|
|
|
1,112
|
|
|
11.11
|
%
|
|
9,997
|
|
|
1,115
|
|
|
11.15
|
%
|
||||||
Total interest-bearing liabilities
|
|
1,467,255
|
|
|
23,933
|
|
|
1.63
|
%
|
|
1,368,243
|
|
|
15,202
|
|
|
1.11
|
%
|
|
1,396,734
|
|
|
14,789
|
|
|
1.06
|
%
|
||||||
Non-interest-bearing demand deposit accounts
|
|
241,529
|
|
|
|
|
|
|
230,907
|
|
|
|
|
|
|
246,182
|
|
|
|
|
|
||||||||||||
Other non-interest-bearing liabilities
|
|
22,076
|
|
|
|
|
|
|
14,375
|
|
|
|
|
|
|
10,210
|
|
|
|
|
|
||||||||||||
Total liabilities
|
|
1,730,860
|
|
|
|
|
|
|
1,613,525
|
|
|
|
|
|
|
1,653,126
|
|
|
|
|
|
||||||||||||
Stockholders’ equity
|
|
173,279
|
|
|
|
|
|
|
166,370
|
|
|
|
|
|
|
158,546
|
|
|
|
|
|
||||||||||||
Total liabilities and stockholders’ equity
|
|
$
|
1,904,139
|
|
|
|
|
|
|
$
|
1,779,895
|
|
|
|
|
|
|
$
|
1,811,672
|
|
|
|
|
|
|||||||||
Net interest income
|
|
|
|
$
|
67,342
|
|
|
|
|
|
|
$
|
60,609
|
|
|
|
|
|
|
$
|
63,328
|
|
|
|
|||||||||
Net interest spread
|
|
|
|
|
|
3.41
|
%
|
|
|
|
|
|
3.36
|
%
|
|
|
|
|
|
3.44
|
%
|
||||||||||||
Net interest-earning assets
|
|
$
|
344,253
|
|
|
|
|
|
|
$
|
326,823
|
|
|
|
|
|
|
$
|
341,033
|
|
|
|
|
|
|||||||||
Net interest margin
|
|
|
|
|
|
3.72
|
%
|
|
|
|
|
|
3.58
|
%
|
|
|
|
|
|
3.64
|
%
|
||||||||||||
Average interest-earning assets to average interest-bearing liabilities
|
|
123.46
|
%
|
|
|
|
|
|
123.89
|
%
|
|
|
|
|
|
124.42
|
%
|
|
|
|
|
||||||||||||
Return on average assets
|
|
0.86
|
%
|
|
|
|
|
|
0.67
|
%
|
|
|
|
|
|
0.82
|
%
|
|
|
|
|
||||||||||||
Return on average equity
|
|
9.41
|
%
|
|
|
|
|
|
7.16
|
%
|
|
|
|
|
|
9.40
|
%
|
|
|
|
|
||||||||||||
Average equity to average assets
|
|
9.10
|
%
|
|
|
|
|
|
9.35
|
%
|
|
|
|
|
|
8.75
|
%
|
|
|
|
|
||||||||||||
Non-interest expense to average assets
|
|
3.28
|
%
|
|
|
|
|
|
3.20
|
%
|
|
|
|
|
|
3.11
|
%
|
|
|
|
|
(1)
|
The average balances of loans and leases include non-performing loans and leases and loans held for sale. Interest income related to non-performing loans and leases is recognized when collected. Interest income includes net loan fees collected in lieu of interest.
|
(2)
|
Includes amortized cost basis of assets available-for-sale and held-to-maturity.
|
(3)
|
Yields on tax-exempt municipal securities are not presented on a tax-equivalent basis in this table.
|
|
|
Increase (Decrease) for the Year Ended December 31,
|
||||||||||||||||||||||
|
|
2018 Compared to 2017
|
|
2017 Compared to 2016
|
||||||||||||||||||||
|
|
Rate
|
|
Volume
|
|
Net
|
|
Rate
|
|
Volume
|
|
Net
|
||||||||||||
|
|
(In Thousands)
|
||||||||||||||||||||||
Interest-earning assets
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commercial real estate and other mortgage loans
(1)
|
|
$
|
4,765
|
|
|
$
|
5,403
|
|
|
$
|
10,168
|
|
|
$
|
(1,538
|
)
|
|
$
|
1,063
|
|
|
$
|
(475
|
)
|
Commercial and industrial loans
(1)
|
|
3,893
|
|
|
(15
|
)
|
|
3,878
|
|
|
(922
|
)
|
|
(1,056
|
)
|
|
(1,978
|
)
|
||||||
Direct financing leases
(1)
|
|
(57
|
)
|
|
94
|
|
|
37
|
|
|
(72
|
)
|
|
(61
|
)
|
|
(133
|
)
|
||||||
Consumer and other loans
(1)
|
|
95
|
|
|
90
|
|
|
185
|
|
|
(169
|
)
|
|
88
|
|
|
(81
|
)
|
||||||
Total loans and leases receivable
(1)
|
|
8,696
|
|
|
5,572
|
|
|
14,268
|
|
|
(2,701
|
)
|
|
34
|
|
|
(2,667
|
)
|
||||||
Mortgage-related securities
(2)
|
|
744
|
|
|
(25
|
)
|
|
719
|
|
|
284
|
|
|
(146
|
)
|
|
138
|
|
||||||
Other investment securities
|
|
35
|
|
|
(60
|
)
|
|
(25
|
)
|
|
96
|
|
|
69
|
|
|
165
|
|
||||||
FHLB and FRB Stock
|
|
81
|
|
|
106
|
|
|
187
|
|
|
(20
|
)
|
|
44
|
|
|
24
|
|
||||||
Short-term investments
|
|
312
|
|
|
3
|
|
|
315
|
|
|
395
|
|
|
(361
|
)
|
|
34
|
|
||||||
Total net change in income on interest-earning assets
|
|
9,868
|
|
|
5,596
|
|
|
15,464
|
|
|
(1,946
|
)
|
|
(360
|
)
|
|
(2,306
|
)
|
||||||
Interest-bearing liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Transaction accounts
|
|
1,042
|
|
|
294
|
|
|
1,336
|
|
|
686
|
|
|
193
|
|
|
879
|
|
||||||
Money market
|
|
3,120
|
|
|
(491
|
)
|
|
2,629
|
|
|
(84
|
)
|
|
(282
|
)
|
|
(366
|
)
|
||||||
Certificates of deposit
|
|
526
|
|
|
504
|
|
|
1,030
|
|
|
63
|
|
|
(86
|
)
|
|
(23
|
)
|
||||||
Wholesale deposits
|
|
819
|
|
|
(1,086
|
)
|
|
(267
|
)
|
|
387
|
|
|
(1,788
|
)
|
|
(1,401
|
)
|
||||||
Total deposits
|
|
5,507
|
|
|
(779
|
)
|
|
4,728
|
|
|
1,052
|
|
|
(1,963
|
)
|
|
(911
|
)
|
||||||
FHLB advances
|
|
944
|
|
|
3,224
|
|
|
4,168
|
|
|
89
|
|
|
1,243
|
|
|
1,332
|
|
||||||
Other borrowings
|
|
(146
|
)
|
|
(19
|
)
|
|
(165
|
)
|
|
113
|
|
|
(118
|
)
|
|
(5
|
)
|
||||||
Junior subordinated notes
|
|
(2
|
)
|
|
2
|
|
|
—
|
|
|
(5
|
)
|
|
2
|
|
|
(3
|
)
|
||||||
Total net change in expense on interest-bearing liabilities
|
|
6,303
|
|
|
2,428
|
|
|
8,731
|
|
|
1,249
|
|
|
(836
|
)
|
|
413
|
|
||||||
Net change in net interest income
|
|
$
|
3,565
|
|
|
$
|
3,168
|
|
|
$
|
6,733
|
|
|
$
|
(3,195
|
)
|
|
$
|
476
|
|
|
$
|
(2,719
|
)
|
(1)
|
The average balances of loans and leases include non-performing loans and leases and loans held for sale. Interest income related to non-performing loans and leases is recognized when collected. Interest income includes net loan fees collected in lieu of interest.
|
(2)
|
Includes amortized cost basis of assets available-for-sale and held-to-maturity.
|
|
For the Year Ended December 31,
|
|
Change From Prior Year
|
|||||||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
$ Change 2018
|
|
% Change 2018
|
|
$ Change 2017
|
|
% Change 2017
|
|||||||||||||
|
(In Thousands)
|
|||||||||||||||||||||||||
Trust and investment services fee income
|
$
|
7,744
|
|
|
$
|
6,670
|
|
|
$
|
5,356
|
|
|
$
|
1,074
|
|
|
16.1
|
%
|
|
$
|
1,314
|
|
|
24.5
|
%
|
|
Gain on sale of SBA loans
|
1,451
|
|
|
1,591
|
|
|
4,400
|
|
|
(140
|
)
|
|
(8.8
|
)
|
|
(2,809
|
)
|
|
(63.8
|
)%
|
||||||
Gain on sale of residential mortgage loans
|
—
|
|
|
26
|
|
|
590
|
|
|
(26
|
)
|
|
(100.0
|
)
|
|
(564
|
)
|
|
(95.6
|
)%
|
||||||
Service charges on deposits
|
3,062
|
|
|
3,013
|
|
|
2,990
|
|
|
49
|
|
|
1.6
|
|
|
23
|
|
|
0.8
|
|
||||||
Loan fees
|
1,783
|
|
|
1,988
|
|
|
2,430
|
|
|
(205
|
)
|
|
(10.3
|
)
|
|
(442
|
)
|
|
(18.2
|
)
|
||||||
Increase in cash surrender value of bank-owned life insurance
|
1,191
|
|
|
1,250
|
|
|
974
|
|
|
(59
|
)
|
|
(4.7
|
)
|
|
276
|
|
|
28.3
|
|
||||||
Net (loss) gain on sale of securities
|
(4
|
)
|
|
(403
|
)
|
|
10
|
|
|
399
|
|
|
(99.0
|
)
|
—
|
|
(413
|
)
|
|
NM
|
|
|||||
Swap fees
|
1,670
|
|
|
909
|
|
|
76
|
|
|
761
|
|
|
83.7
|
|
—
|
|
833
|
|
|
NM
|
|
|||||
Other non-interest income
|
1,270
|
|
|
1,621
|
|
|
1,162
|
|
|
(351
|
)
|
|
(21.7
|
)
|
|
459
|
|
|
39.5
|
|
||||||
Total non-interest income
|
$
|
18,167
|
|
|
$
|
16,665
|
|
|
$
|
17,988
|
|
|
$
|
1,502
|
|
|
9.0
|
|
|
$
|
(1,323
|
)
|
|
(7.4
|
)
|
|
Fee income ratio
(1)
|
21.2
|
%
|
|
21.6
|
%
|
|
22.1
|
%
|
|
|
|
|
|
|
|
|
(1)
|
Fee income ratio is fee income, per the above table, divided by top line revenue (defined as net interest income plus non-interest income).
|
|
For the Year Ended December 31,
|
|
Change From Prior Year
|
||||||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
$ Change 2018
|
|
% Change 2018
|
|
$ Change 2017
|
|
% Change 2017
|
||||||||||||
|
(Dollars in Thousands)
|
||||||||||||||||||||||||
Compensation
|
$
|
37,439
|
|
|
$
|
31,663
|
|
|
$
|
31,545
|
|
|
$
|
5,776
|
|
|
18.2
|
%
|
|
$
|
118
|
|
|
0.4
|
%
|
Occupancy
|
2,192
|
|
|
2,088
|
|
|
2,019
|
|
|
104
|
|
|
5.0
|
|
|
69
|
|
|
3.4
|
|
|||||
Professional fees
|
3,869
|
|
|
4,063
|
|
|
4,031
|
|
|
(194
|
)
|
|
(4.8
|
)
|
|
32
|
|
|
0.8
|
|
|||||
Data processing
|
2,362
|
|
|
2,701
|
|
|
3,298
|
|
|
(339
|
)
|
|
(12.6
|
)
|
|
(597
|
)
|
|
(18.1
|
)
|
|||||
Marketing
|
2,135
|
|
|
2,109
|
|
|
2,338
|
|
|
26
|
|
|
1.2
|
|
|
(229
|
)
|
|
(9.8
|
)
|
|||||
Equipment
|
1,434
|
|
|
1,211
|
|
|
1,189
|
|
|
223
|
|
|
18.4
|
|
|
22
|
|
|
1.9
|
|
|||||
Computer software
|
3,015
|
|
|
2,723
|
|
|
2,160
|
|
|
292
|
|
|
10.7
|
|
|
563
|
|
|
26.1
|
|
|||||
FDIC insurance
|
1,478
|
|
|
1,388
|
|
|
1,472
|
|
|
90
|
|
|
6.5
|
|
|
(84
|
)
|
|
(5.7
|
)
|
|||||
Collateral liquidation costs
|
646
|
|
|
829
|
|
|
262
|
|
|
(183
|
)
|
|
(22.1
|
)
|
|
567
|
|
|
216.4
|
|
|||||
Net loss (gain) on foreclosed properties
|
367
|
|
|
(143
|
)
|
|
122
|
|
|
510
|
|
|
NM
|
|
|
(265
|
)
|
|
NM
|
|
|||||
Impairment on tax credit investments
|
2,083
|
|
|
2,784
|
|
|
3,691
|
|
|
(701
|
)
|
|
(25.2
|
)
|
|
(907
|
)
|
|
(24.6
|
)
|
|||||
SBA recourse provision
|
1,913
|
|
|
2,240
|
|
|
2,068
|
|
|
(327
|
)
|
|
(14.6
|
)
|
|
172
|
|
|
8.3
|
|
|||||
Other non-interest expense
|
3,430
|
|
|
3,215
|
|
|
2,238
|
|
|
215
|
|
|
6.7
|
|
|
977
|
|
|
43.7
|
|
|||||
Total non-interest expense
|
$
|
62,363
|
|
|
$
|
56,871
|
|
|
$
|
56,433
|
|
|
$
|
5,492
|
|
|
9.7
|
|
|
$
|
438
|
|
|
0.8
|
|
Compensation expense to total non-interest expense
|
60.0
|
%
|
|
55.7
|
%
|
|
55.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|||||||
Full-time equivalent employees
|
274
|
|
|
251
|
|
|
257
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of December 31,
|
||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||||||||||||||
|
|
Amortized Cost
|
|
Fair Value
|
|
Amortized Cost
|
|
Fair Value
|
|
Amortized Cost
|
|
Fair Value
|
||||||||||||
|
|
(In Thousands)
|
||||||||||||||||||||||
Available-for-sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. government agency securities - government-sponsored enterprises
|
|
$
|
999
|
|
|
$
|
990
|
|
|
$
|
999
|
|
|
$
|
1,000
|
|
|
$
|
6,298
|
|
|
$
|
6,295
|
|
Municipal securities
|
|
5,953
|
|
|
5,886
|
|
|
9,494
|
|
|
9,414
|
|
|
8,246
|
|
|
8,156
|
|
||||||
Asset-backed securities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,116
|
|
|
1,081
|
|
||||||
Mortgage backed securities - government issued
|
|
20,007
|
|
|
19,628
|
|
|
22,313
|
|
|
22,249
|
|
|
30,936
|
|
|
31,213
|
|
||||||
Mortgage backed securities - government-sponsored enterprises
|
|
110,928
|
|
|
109,478
|
|
|
91,480
|
|
|
90,305
|
|
|
99,865
|
|
|
99,148
|
|
||||||
Other securities
|
|
2,450
|
|
|
2,376
|
|
|
3,040
|
|
|
3,037
|
|
|
—
|
|
|
—
|
|
||||||
|
|
$
|
140,337
|
|
|
$
|
138,358
|
|
|
$
|
127,326
|
|
|
$
|
126,005
|
|
|
$
|
146,461
|
|
|
$
|
145,893
|
|
|
|
As of December 31,
|
||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||||||||||||||
|
|
Amortized Cost
|
|
Fair Value
|
|
Amortized Cost
|
|
Fair Value
|
|
Amortized Cost
|
|
Fair Value
|
||||||||||||
|
|
(In Thousands)
|
||||||||||||||||||||||
Held-to-maturity:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. government agency securities - government-sponsored enterprises
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,499
|
|
|
$
|
1,490
|
|
|
$
|
1,497
|
|
|
$
|
1,494
|
|
Municipal securities
|
|
21,066
|
|
|
21,079
|
|
|
21,680
|
|
|
21,822
|
|
|
21,173
|
|
|
21,157
|
|
||||||
Mortgage backed securities - government issued
|
|
7,358
|
|
|
7,186
|
|
|
9,072
|
|
|
8,943
|
|
|
9,148
|
|
|
9,127
|
|
||||||
Mortgage backed securities - government-sponsored enterprises
|
|
9,307
|
|
|
9,144
|
|
|
5,527
|
|
|
5,441
|
|
|
6,794
|
|
|
6,742
|
|
||||||
|
|
$
|
37,731
|
|
|
$
|
37,409
|
|
|
$
|
37,778
|
|
|
$
|
37,696
|
|
|
$
|
38,612
|
|
|
$
|
38,520
|
|
|
|
Less than One Year
|
|
One to Five Years
|
|
Five to Ten Years
|
|
Over Ten Years
|
|
|
||||||||||||||||||||||
|
|
Fair Value
|
|
Weighted
Average Yield |
|
Fair Value
|
|
Weighted
Average Yield |
|
Fair Value
|
|
Weighted
Average Yield |
|
Fair Value
|
|
Weighted
Average Yield |
|
Total
|
||||||||||||||
|
|
(Dollars in Thousands)
|
||||||||||||||||||||||||||||||
Available-for-sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
U.S. government agency securities - government-sponsored enterprises
|
|
$
|
—
|
|
|
—
|
%
|
|
$
|
990
|
|
|
2.02
|
%
|
|
$
|
—
|
|
|
—
|
%
|
|
$
|
—
|
|
|
—
|
%
|
|
$
|
990
|
|
Municipal securities
|
|
1,556
|
|
|
2.00
|
|
|
2,517
|
|
|
1.30
|
|
|
1,813
|
|
|
1.86
|
|
|
—
|
|
|
—
|
|
|
5,886
|
|
|||||
Mortgage backed securities - government issued
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,500
|
|
|
2.60
|
|
|
15,128
|
|
|
2.49
|
|
|
19,628
|
|
|||||
Mortgage backed securities - government-sponsored enterprises
|
|
—
|
|
|
—
|
|
|
15,388
|
|
|
2.18
|
|
|
20,223
|
|
|
2.26
|
|
|
73,867
|
|
|
2.69
|
|
|
109,478
|
|
|||||
Other securities
|
|
244
|
|
|
1.25
|
|
|
2,132
|
|
|
2.30
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,376
|
|
|||||
|
|
$
|
1,800
|
|
|
|
|
$
|
21,027
|
|
|
|
|
$
|
26,536
|
|
|
|
|
$
|
88,995
|
|
|
|
|
$
|
138,358
|
|
|
|
Less than One Year
|
|
One to Five Years
|
|
Five to Ten Years
|
|
Over Ten Years
|
|
|
||||||||||||||||||||||
|
|
Amortized Cost
|
|
Weighted
Average Yield |
|
Amortized Cost
|
|
Weighted
Average Yield |
|
Amortized Cost
|
|
Weighted
Average Yield |
|
Amortized Cost
|
|
Weighted
Average Yield |
|
Total
|
||||||||||||||
|
|
(Dollars in Thousands)
|
||||||||||||||||||||||||||||||
Held-to-maturity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Municipal securities
|
|
771
|
|
|
2.14
|
|
|
11,834
|
|
|
2.01
|
|
|
8,461
|
|
|
2.31
|
|
|
—
|
|
|
—
|
|
|
21,066
|
|
|||||
Mortgage backed securities - government issued
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,330
|
|
|
1.86
|
|
|
4,028
|
|
|
2.19
|
|
|
7,358
|
|
|||||
Mortgage backed securities - government-sponsored enterprises
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,262
|
|
|
2.22
|
|
|
2,045
|
|
|
3.42
|
|
|
9,307
|
|
|||||
|
|
$
|
771
|
|
|
|
|
$
|
11,834
|
|
|
|
|
$
|
19,053
|
|
|
|
|
$
|
6,073
|
|
|
|
|
$
|
37,731
|
|
|
|
As of December 31,
|
|||||||||||||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|||||||||||||||||||||||||
|
|
Amount Outstanding
|
|
% of Total Loans and Leases
|
|
Amount Outstanding
|
|
% of Total Loans and Leases
|
|
Amount Outstanding
|
|
% of Total Loans and Leases
|
|
Amount Outstanding
|
|
% of Total Loans and Leases
|
|
Amount Outstanding
|
|
% of Total Loans and Leases
|
|||||||||||||||
|
|
(Dollars in Thousands)
|
|||||||||||||||||||||||||||||||||
Commercial real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Commercial real estate — owner occupied
|
|
$
|
203,476
|
|
|
12.6
|
%
|
|
$
|
200,387
|
|
|
13.3
|
%
|
|
$
|
176,459
|
|
|
12.2
|
%
|
|
$
|
176,322
|
|
|
12.3
|
%
|
|
$
|
163,884
|
|
|
12.8
|
%
|
Commercial real estate — non-owner occupied
|
|
484,427
|
|
|
29.9
|
|
|
470,236
|
|
|
31.3
|
|
|
473,158
|
|
|
32.6
|
|
|
436,901
|
|
|
30.5
|
|
|
417,962
|
|
|
32.6
|
|
|||||
Land development
|
|
42,666
|
|
|
2.6
|
|
|
40,154
|
|
|
2.7
|
|
|
56,638
|
|
|
3.9
|
|
|
59,779
|
|
|
4.2
|
|
|
56,836
|
|
|
4.4
|
|
|||||
Construction
|
|
161,562
|
|
|
10.0
|
|
|
125,157
|
|
|
8.3
|
|
|
101,206
|
|
|
7.0
|
|
|
100,625
|
|
|
7.0
|
|
|
64,324
|
|
|
5.0
|
|
|||||
Multi-family
|
|
167,868
|
|
|
10.4
|
|
|
136,978
|
|
|
9.1
|
|
|
92,762
|
|
|
6.4
|
|
|
80,254
|
|
|
5.6
|
|
|
72,578
|
|
|
5.7
|
|
|||||
1-4 family
|
|
34,340
|
|
|
2.1
|
|
|
44,976
|
|
|
3.0
|
|
|
45,651
|
|
|
3.1
|
|
|
50,304
|
|
|
3.5
|
|
|
36,182
|
|
|
2.8
|
|
|||||
Total commercial real estate
|
|
1,094,339
|
|
|
67.6
|
|
|
1,017,888
|
|
|
67.7
|
|
|
945,874
|
|
|
65.2
|
|
|
904,185
|
|
|
63.1
|
|
|
811,766
|
|
|
63.3
|
|
|||||
Commercial and industrial
|
|
462,321
|
|
|
28.6
|
|
|
429,002
|
|
|
28.5
|
|
|
450,298
|
|
|
31.0
|
|
|
472,193
|
|
|
33.0
|
|
|
416,654
|
|
|
32.5
|
|
|||||
Direct financing leases, net
|
|
33,170
|
|
|
2.0
|
|
|
30,787
|
|
|
2.1
|
|
|
30,951
|
|
|
2.1
|
|
|
31,093
|
|
|
2.2
|
|
|
34,165
|
|
|
2.7
|
|
|||||
Consumer and other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Home equity and second mortgage
|
|
8,438
|
|
|
0.5
|
|
|
7,262
|
|
|
0.5
|
|
|
8,412
|
|
|
0.6
|
|
|
8,237
|
|
|
0.6
|
|
|
7,866
|
|
|
0.6
|
|
|||||
Other
|
|
20,789
|
|
|
1.3
|
|
|
18,099
|
|
|
1.2
|
|
|
16,329
|
|
|
1.1
|
|
|
16,319
|
|
|
1.1
|
|
|
11,341
|
|
|
0.9
|
|
|||||
Total consumer and other
|
|
29,227
|
|
|
1.8
|
|
|
25,361
|
|
|
1.7
|
|
|
24,741
|
|
|
1.7
|
|
|
24,556
|
|
|
1.7
|
|
|
19,207
|
|
|
1.5
|
|
|||||
Total gross loans and leases receivable
|
|
1,619,057
|
|
|
100.0
|
%
|
|
1,503,038
|
|
|
100.0
|
%
|
|
1,451,864
|
|
|
100.0
|
%
|
|
1,432,027
|
|
|
100.0
|
%
|
|
1,281,792
|
|
|
100.0
|
%
|
|||||
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Allowance for loan and lease losses
|
|
20,425
|
|
|
|
|
18,763
|
|
|
|
|
20,912
|
|
|
|
|
16,316
|
|
|
|
|
14,329
|
|
|
|
||||||||||
Deferred loan fees
|
|
1,402
|
|
|
|
|
1,443
|
|
|
|
|
1,189
|
|
|
|
|
1,062
|
|
|
|
|
1,025
|
|
|
|
||||||||||
Loans and leases receivable, net
|
|
$
|
1,597,230
|
|
|
|
|
$
|
1,482,832
|
|
|
|
|
$
|
1,429,763
|
|
|
|
|
$
|
1,414,649
|
|
|
|
|
$
|
1,266,438
|
|
|
|
|
|
Amounts Due
|
|
Interest Terms On Amounts Due after One Year
|
||||||||||||||||||||
|
|
In One Year
or Less
|
|
After One
Year through
Five Years
|
|
After Five
Years
|
|
Total
|
|
Fixed Rate
|
|
Variable
Rate
|
||||||||||||
|
|
(In Thousands)
|
||||||||||||||||||||||
Commercial real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Owner-occupied
|
|
$
|
11,553
|
|
|
$
|
128,267
|
|
|
$
|
63,656
|
|
|
$
|
203,476
|
|
|
$
|
142,551
|
|
|
$
|
49,372
|
|
Non-owner occupied
|
|
53,571
|
|
|
303,021
|
|
|
127,835
|
|
|
484,427
|
|
|
316,657
|
|
|
114,200
|
|
||||||
Land development
|
|
18,868
|
|
|
23,184
|
|
|
614
|
|
|
42,666
|
|
|
8,887
|
|
|
14,911
|
|
||||||
Construction
|
|
27,181
|
|
|
35,377
|
|
|
99,004
|
|
|
161,562
|
|
|
31,887
|
|
|
102,494
|
|
||||||
Multi-family
|
|
21,165
|
|
|
87,825
|
|
|
58,878
|
|
|
167,868
|
|
|
104,681
|
|
|
42,022
|
|
||||||
1-4 family
|
|
7,992
|
|
|
25,003
|
|
|
1,345
|
|
|
34,340
|
|
|
25,929
|
|
|
419
|
|
||||||
Commercial and industrial
|
|
173,279
|
|
|
223,291
|
|
|
65,751
|
|
|
462,321
|
|
|
121,550
|
|
|
167,491
|
|
||||||
Direct financing leases
|
|
5,132
|
|
|
20,732
|
|
|
7,306
|
|
|
33,170
|
|
|
28,038
|
|
|
—
|
|
||||||
Consumer and other
|
|
13,047
|
|
|
14,964
|
|
|
1,216
|
|
|
29,227
|
|
|
11,867
|
|
|
4,313
|
|
||||||
|
|
$
|
331,788
|
|
|
$
|
861,664
|
|
|
$
|
425,605
|
|
|
$
|
1,619,057
|
|
|
$
|
792,047
|
|
|
$
|
495,222
|
|
|
|
As of December 31,
|
||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
|
|
(Dollars in Thousands)
|
||||||||||||||||||
Non-accrual loans and leases
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial real estate:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial real estate – owner occupied
|
|
$
|
5,663
|
|
|
$
|
7,021
|
|
|
$
|
2,223
|
|
|
$
|
2,907
|
|
|
$
|
500
|
|
Commercial real estate – non-owner occupied
|
|
31
|
|
|
34
|
|
|
1,609
|
|
|
1,678
|
|
|
286
|
|
|||||
Land development
|
|
2,213
|
|
|
2,626
|
|
|
3,440
|
|
|
4,393
|
|
|
4,932
|
|
|||||
Construction
|
|
—
|
|
|
2,872
|
|
|
2,918
|
|
|
397
|
|
|
—
|
|
|||||
Multi-family
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
17
|
|
|||||
1-4 family
|
|
—
|
|
|
1,161
|
|
|
1,937
|
|
|
2,550
|
|
|
690
|
|
|||||
Total non-accrual commercial real estate
|
|
7,907
|
|
|
13,714
|
|
|
12,127
|
|
|
11,927
|
|
|
6,425
|
|
|||||
Commercial and industrial
|
|
17,104
|
|
|
12,321
|
|
|
12,463
|
|
|
9,136
|
|
|
2,318
|
|
|||||
Direct financing leases, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
38
|
|
|
—
|
|
|||||
Consumer and other:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Home equity and second mortgage
|
|
—
|
|
|
—
|
|
|
—
|
|
|
542
|
|
|
329
|
|
|||||
Other
|
|
290
|
|
|
354
|
|
|
604
|
|
|
655
|
|
|
720
|
|
|||||
Total non-accrual consumer and other loans
|
|
290
|
|
|
354
|
|
|
604
|
|
|
1,197
|
|
|
1,049
|
|
|||||
Total non-accrual loans and leases
|
|
25,301
|
|
|
26,389
|
|
|
25,194
|
|
|
22,298
|
|
|
9,792
|
|
|||||
Foreclosed properties, net
|
|
2,547
|
|
|
1,069
|
|
|
1,472
|
|
|
1,677
|
|
|
1,693
|
|
|||||
Total non-performing assets
|
|
27,848
|
|
|
27,458
|
|
|
26,666
|
|
|
23,975
|
|
|
11,485
|
|
|||||
Performing troubled debt restructurings
|
|
180
|
|
|
332
|
|
|
717
|
|
|
1,735
|
|
|
2,003
|
|
|||||
Total impaired assets
|
|
$
|
28,028
|
|
|
$
|
27,790
|
|
|
$
|
27,383
|
|
|
$
|
25,710
|
|
|
$
|
13,488
|
|
Total non-accrual loans and leases to gross loans and leases
|
|
1.56
|
%
|
|
1.76
|
%
|
|
1.74
|
%
|
|
1.56
|
%
|
|
1.61
|
%
|
|||||
Total non-performing assets to gross loans and leases plus foreclosed properties, net
|
|
1.72
|
%
|
|
1.83
|
%
|
|
1.83
|
%
|
|
1.67
|
%
|
|
1.65
|
%
|
|||||
Total non-performing assets to total assets
|
|
1.42
|
%
|
|
1.53
|
%
|
|
1.50
|
%
|
|
1.35
|
%
|
|
1.28
|
%
|
|||||
Allowance for loan and lease losses to gross loans and leases
|
|
1.26
|
%
|
|
1.25
|
%
|
|
1.44
|
%
|
|
1.14
|
%
|
|
1.42
|
%
|
|||||
Allowance for loan and lease losses to non-accrual loans and leases
|
|
80.73
|
%
|
|
71.10
|
%
|
|
83.00
|
%
|
|
73.17
|
%
|
|
87.68
|
%
|
|
|
As of December 31,
|
||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
|
|
(In Thousands)
|
||||||||||||||||||
Impaired loans and leases with no impairment reserves
|
|
$
|
10,802
|
|
|
$
|
16,975
|
|
|
$
|
11,345
|
|
|
$
|
15,175
|
|
|
$
|
11,270
|
|
Impaired loans and leases with impairment reserves required
|
|
14,679
|
|
|
9,746
|
|
|
14,566
|
|
|
8,858
|
|
|
525
|
|
|||||
Total impaired loans and leases
|
|
25,481
|
|
|
26,721
|
|
|
25,911
|
|
|
24,033
|
|
|
11,795
|
|
|||||
Less: Impairment reserve (included in allowance for loan and lease losses)
|
|
4,396
|
|
|
4,491
|
|
|
5,599
|
|
|
1,113
|
|
|
290
|
|
|||||
Net impaired loans and leases
|
|
$
|
21,085
|
|
|
$
|
22,230
|
|
|
$
|
20,312
|
|
|
$
|
22,920
|
|
|
$
|
11,505
|
|
Average impaired loans and leases
|
|
$
|
26,431
|
|
|
$
|
33,164
|
|
|
$
|
22,986
|
|
|
$
|
11,443
|
|
|
$
|
14,474
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
For the years ended December 31,
|
||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
|
|
(In Thousands)
|
||||||||||||||||||
Interest income attributable to impaired loans and leases
|
|
$
|
3,478
|
|
|
$
|
2,695
|
|
|
$
|
1,617
|
|
|
$
|
750
|
|
|
$
|
870
|
|
Less: Interest income recognized on impaired loans and leases
|
|
1,304
|
|
|
454
|
|
|
614
|
|
|
87
|
|
|
740
|
|
|||||
Net foregone interest income on impaired loans and leases
|
|
$
|
2,174
|
|
|
$
|
2,241
|
|
|
$
|
1,003
|
|
|
$
|
663
|
|
|
$
|
130
|
|
|
|
For the Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(In Thousands)
|
||||||||||
Balance at the beginning of the period
|
|
$
|
1,069
|
|
|
$
|
1,472
|
|
|
$
|
1,677
|
|
Transfer of loans to foreclosed properties, at fair value
|
|
2,202
|
|
|
1,112
|
|
|
—
|
|
|||
Impairment adjustments
|
|
(339
|
)
|
|
(403
|
)
|
|
(7
|
)
|
|||
Net book value of properties sold
|
|
(385
|
)
|
|
(1,112
|
)
|
|
(198
|
)
|
|||
Balance at the end of the period
|
|
$
|
2,547
|
|
|
$
|
1,069
|
|
|
$
|
1,472
|
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
|
|
(Dollars in Thousands)
|
||||||||||||||||||
Allowance at beginning of period
|
|
$
|
18,763
|
|
|
$
|
20,912
|
|
|
$
|
16,316
|
|
|
$
|
14,329
|
|
|
$
|
13,901
|
|
Charge-offs:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial real estate
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial real estate — owner occupied
|
|
(3,124
|
)
|
|
(9
|
)
|
|
(41
|
)
|
|
—
|
|
|
—
|
|
|||||
Commercial real estate — non-owner occupied
|
|
—
|
|
|
(80
|
)
|
|
—
|
|
|
(653
|
)
|
|
(631
|
)
|
|||||
Construction and land development
|
|
(1,372
|
)
|
|
—
|
|
|
(948
|
)
|
|
—
|
|
|
—
|
|
|||||
Multi-family
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
1-4 family
|
|
(5
|
)
|
|
(38
|
)
|
|
(205
|
)
|
|
(120
|
)
|
|
—
|
|
|||||
Commercial and industrial
|
|
(1,545
|
)
|
|
(8,621
|
)
|
|
(2,273
|
)
|
|
(701
|
)
|
|
(600
|
)
|
|||||
Direct financing leases
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Consumer and other
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Home equity and second mortgage
|
|
—
|
|
|
—
|
|
|
(114
|
)
|
|
(32
|
)
|
|
—
|
|
|||||
Other
|
|
(55
|
)
|
|
(92
|
)
|
|
(13
|
)
|
|
(7
|
)
|
|
(2
|
)
|
|||||
Total charge-offs
|
|
(6,101
|
)
|
|
(8,840
|
)
|
|
(3,594
|
)
|
|
(1,513
|
)
|
|
(1,233
|
)
|
|||||
Recoveries:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial real estate
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial real estate — owner occupied
|
|
4
|
|
|
42
|
|
|
—
|
|
|
2
|
|
|
8
|
|
|||||
Commercial real estate — non-owner occupied
|
|
2
|
|
|
2
|
|
|
74
|
|
|
—
|
|
|
5
|
|
|||||
Construction and land development
|
|
5
|
|
|
102
|
|
|
129
|
|
|
70
|
|
|
—
|
|
|||||
Multi-family
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14
|
|
|||||
1-4 family
|
|
163
|
|
|
7
|
|
|
71
|
|
|
32
|
|
|
17
|
|
|||||
Commercial and industrial
|
|
2,022
|
|
|
323
|
|
|
91
|
|
|
5
|
|
|
369
|
|
|||||
Direct financing leases
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Consumer and other
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Home equity and second mortgage
|
|
73
|
|
|
3
|
|
|
4
|
|
|
4
|
|
|
12
|
|
|||||
Other
|
|
1
|
|
|
40
|
|
|
3
|
|
|
1
|
|
|
—
|
|
|||||
Total recoveries
|
|
2,271
|
|
|
519
|
|
|
372
|
|
|
114
|
|
|
425
|
|
|||||
Net charge-offs
|
|
(3,830
|
)
|
|
(8,321
|
)
|
|
(3,222
|
)
|
|
(1,399
|
)
|
|
(808
|
)
|
|||||
Provision for loan and lease losses
|
|
5,492
|
|
|
6,172
|
|
|
7,818
|
|
|
3,386
|
|
|
1,236
|
|
|||||
Allowance at end of period
|
|
$
|
20,425
|
|
|
$
|
18,763
|
|
|
$
|
20,912
|
|
|
$
|
16,316
|
|
|
$
|
14,329
|
|
Net charge-offs as a percent of average gross loans and leases
|
|
0.24
|
%
|
|
0.57
|
%
|
|
0.22
|
%
|
|
0.10
|
%
|
|
0.08
|
%
|
|
|
As of December 31,
|
|||||||||||||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|||||||||||||||||||||||||
|
|
Balance
|
|
(a)
|
|
Balance
|
|
(a)
|
|
Balance
|
|
(a)
|
|
Balance
|
|
(a)
|
|
Balance
|
|
(a)
|
|||||||||||||||
|
|
(Dollars in Thousands)
|
|||||||||||||||||||||||||||||||||
Loan and lease segments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Commercial real estate
|
|
$
|
11,662
|
|
|
1.07
|
%
|
|
$
|
10,131
|
|
|
1.00
|
%
|
|
$
|
12,384
|
|
|
1.31
|
%
|
|
$
|
11,220
|
|
|
1.24
|
%
|
|
$
|
8,619
|
|
|
1.06
|
%
|
Commercial and industrial
|
|
8,079
|
|
|
1.63
|
%
|
|
8,225
|
|
|
1.79
|
%
|
|
7,970
|
|
|
1.66
|
%
|
|
4,387
|
|
|
0.87
|
%
|
|
5,492
|
|
|
1.22
|
%
|
|||||
Consumer and other
|
|
684
|
|
|
2.34
|
%
|
|
407
|
|
|
1.60
|
%
|
|
558
|
|
|
2.26
|
%
|
|
709
|
|
|
2.89
|
%
|
|
218
|
|
|
1.14
|
%
|
|||||
Total allowance for loan and lease losses
|
|
$
|
20,425
|
|
|
1.26
|
%
|
|
$
|
18,763
|
|
|
1.25
|
%
|
|
$
|
20,912
|
|
|
1.44
|
%
|
|
$
|
16,316
|
|
|
1.14
|
%
|
|
$
|
14,329
|
|
|
1.12
|
%
|
(a)
|
Allowance for loan losses category as a percentage of total loans by category.
|
|
|
As of December 31,
|
|||||||||||||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|||||||||||||||||||||||||
|
|
Balance
|
|
% of Total Deposits
|
|
Balance
|
|
% of Total Deposits
|
|
Balance
|
|
% of Total Deposits
|
|
Balance
|
|
% of Total Deposits
|
|
Balance
|
|
% of Total Deposits
|
|||||||||||||||
|
|
(Dollars in Thousands)
|
|||||||||||||||||||||||||||||||||
Non-interest-bearing transaction accounts
|
|
$
|
280,769
|
|
|
19.3
|
%
|
|
$
|
277,445
|
|
|
19.9
|
%
|
|
$
|
252,638
|
|
|
16.4
|
%
|
|
$
|
231,199
|
|
|
14.7
|
%
|
|
$
|
204,328
|
|
|
14.2
|
%
|
Interest-bearing transaction accounts
|
|
229,612
|
|
|
15.8
|
|
|
217,625
|
|
|
15.6
|
|
|
183,992
|
|
|
12.0
|
|
|
165,921
|
|
|
10.5
|
|
|
104,199
|
|
|
7.2
|
|
|||||
Money market accounts
|
|
516,045
|
|
|
35.4
|
|
|
515,077
|
|
|
36.9
|
|
|
627,090
|
|
|
40.8
|
|
|
612,642
|
|
|
38.8
|
|
|
575,766
|
|
|
40.0
|
|
|||||
Certificates of deposit
|
|
153,022
|
|
|
10.5
|
|
|
76,199
|
|
|
5.5
|
|
|
58,454
|
|
|
3.8
|
|
|
79,986
|
|
|
5.1
|
|
|
126,635
|
|
|
8.8
|
|
|||||
Wholesale deposits
|
|
275,851
|
|
|
19.0
|
|
|
307,985
|
|
|
22.1
|
|
|
416,681
|
|
|
27.1
|
|
|
487,483
|
|
|
30.9
|
|
|
427,340
|
|
|
29.8
|
|
|||||
Total deposits
|
|
1,455,299
|
|
|
100.0
|
%
|
|
1,394,331
|
|
|
100.0
|
%
|
|
1,538,855
|
|
|
100.0
|
%
|
|
1,577,231
|
|
|
100.0
|
%
|
|
1,438,268
|
|
|
100.0
|
%
|
Interest Rate
|
|
Three Months and Less
|
|
Over Three Months Through Six Months
|
|
Over Six Months Through Twelve Months
|
|
Over Twelve Months
|
|
Total
|
||||||||||
|
|
(In Thousands)
|
||||||||||||||||||
0.00% to 0.99%
|
|
$
|
3,020
|
|
|
$
|
619
|
|
|
$
|
676
|
|
|
$
|
108
|
|
|
$
|
4,423
|
|
1.00% to 1.99%
|
|
12,265
|
|
|
35,186
|
|
|
43,869
|
|
|
80,859
|
|
|
172,179
|
|
|||||
2.00% to 2.99%
|
|
23,323
|
|
|
23,238
|
|
|
81,373
|
|
|
95,907
|
|
|
223,841
|
|
|||||
3.00% to 3.99%
|
|
—
|
|
|
245
|
|
|
1,125
|
|
|
27,060
|
|
|
28,430
|
|
|||||
|
|
$
|
38,608
|
|
|
$
|
59,288
|
|
|
$
|
127,043
|
|
|
$
|
203,934
|
|
|
$
|
428,873
|
|
|
|
December 31, 2018
|
|
December 31, 2017
|
|
December 31, 2016
|
|||||||||||||||||||||||||||
|
|
Balance
|
|
Weighted
Average Balance |
|
Weighted
Average Rate |
|
Balance
|
|
Weighted
Average Balance |
|
Weighted
Average Rate |
|
Balance
|
|
Weighted
Average Balance |
|
Weighted
Average Rate |
|||||||||||||||
|
|
(Dollars in Thousands)
|
|||||||||||||||||||||||||||||||
Federal funds purchased
|
|
$
|
—
|
|
|
$
|
119
|
|
|
2.43
|
%
|
|
$
|
—
|
|
|
$
|
66
|
|
|
1.22
|
%
|
|
$
|
—
|
|
|
$
|
178
|
|
|
0.92
|
%
|
FHLB advances
|
|
274,500
|
|
|
274,382
|
|
|
2.06
|
|
|
183,500
|
|
|
105,276
|
|
|
1.40
|
|
|
33,578
|
|
|
14,485
|
|
|
0.97
|
|
||||||
Line of credit
|
|
—
|
|
|
3
|
|
|
4.47
|
|
|
10
|
|
|
328
|
|
|
3.64
|
|
|
1,010
|
|
|
2,079
|
|
|
3.26
|
|
||||||
Other borrowings
(1)
|
|
675
|
|
|
675
|
|
|
7.94
|
|
|
675
|
|
|
1,241
|
|
|
14.50
|
|
|
2,590
|
|
|
1,739
|
|
|
7.64
|
|
||||||
Subordinated notes payable
|
|
23,769
|
|
|
23,739
|
|
|
6.64
|
|
|
23,713
|
|
|
23,161
|
|
|
6.93
|
|
|
22,498
|
|
|
22,467
|
|
|
7.13
|
|
||||||
Junior subordinated notes
|
|
10,033
|
|
|
10,025
|
|
|
11.10
|
|
|
10,019
|
|
|
10,011
|
|
|
11.11
|
|
|
10,004
|
|
|
9,997
|
|
|
11.07
|
|
||||||
|
|
$
|
308,977
|
|
|
$
|
308,943
|
|
|
2.72
|
|
|
$
|
217,917
|
|
|
$
|
140,083
|
|
|
3.14
|
|
|
$
|
69,680
|
|
|
$
|
50,945
|
|
|
6.03
|
|
Short-term borrowings
|
|
$
|
136,500
|
|
|
|
|
|
|
$
|
37,010
|
|
|
|
|
|
|
$
|
20,588
|
|
|
|
|
|
|||||||||
Long-term borrowings
|
|
172,477
|
|
|
|
|
|
|
180,907
|
|
|
|
|
|
|
49,092
|
|
|
|
|
|
||||||||||||
|
|
$
|
308,977
|
|
|
|
|
|
|
$
|
217,917
|
|
|
|
|
|
|
$
|
69,680
|
|
|
|
|
|
(1)
|
Weighted average rate of other borrowings reflects the cost of prepaying a secured borrowing during the second quarter of 2017.
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(In Thousands)
|
||||||||||
Maximum month-end balance:
|
|
|
|
|
|
|
||||||
FHLB advances
|
|
$
|
52,500
|
|
|
$
|
49,000
|
|
|
$
|
45,500
|
|
|
|
As of and for the Year Ended December 31,
|
||||
|
|
2018
|
|
2017
|
||
Total capital (to risk-weighted assets)
|
|
11.85
|
%
|
|
11.98
|
%
|
Tier 1 capital (to risk-weighted assets)
|
|
9.41
|
%
|
|
9.45
|
%
|
Common equity tier 1 capital (to risk-weighted assets)
|
|
8.89
|
%
|
|
8.89
|
%
|
Tier 1 leverage capital (to adjusted assets)
|
|
9.33
|
%
|
|
9.54
|
%
|
Tangible common equity (to tangible assets)
|
|
8.63
|
%
|
|
8.79
|
%
|
|
|
Payments Due by Period
|
||||||||||||||||||
|
|
Less than
1 Year
|
|
1-3 Years
|
|
4-5 Years
|
|
More than 5 Years
|
|
Total
|
||||||||||
|
|
(In Thousands)
|
||||||||||||||||||
Operating lease obligations
|
|
$
|
1,690
|
|
|
$
|
3,047
|
|
|
$
|
2,424
|
|
|
$
|
3,063
|
|
|
$
|
10,224
|
|
Time deposits
|
|
224,939
|
|
|
154,194
|
|
|
29,954
|
|
|
19,786
|
|
|
428,873
|
|
|||||
Subordinated notes payable
|
|
—
|
|
|
—
|
|
|
—
|
|
|
23,769
|
|
|
23,769
|
|
|||||
Junior subordinated notes
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,033
|
|
|
10,033
|
|
|||||
FHLB advances
|
|
136,500
|
|
|
124,500
|
|
|
13,500
|
|
|
—
|
|
|
274,500
|
|
|||||
Other borrowings
|
|
—
|
|
|
—
|
|
|
—
|
|
|
675
|
|
|
675
|
|
|||||
Total contractual obligations
|
|
$
|
363,129
|
|
|
$
|
281,741
|
|
|
$
|
45,878
|
|
|
$
|
57,326
|
|
|
$
|
748,074
|
|
Item 7A.
|
Quantitative and Qualitative Disclosures about Market Risk
|
•
|
the behavior of interest rates and pricing spreads;
|
•
|
the changes in product balances; and
|
•
|
the behavior of loan and deposit clients in different rate environments.
|
|
|
Impact on Net Interest Income as of December 31,
|
||||
Instantaneous Rate Change in Basis Points
|
|
2018
|
|
2017
|
||
Down 100
|
|
0.21
|
%
|
|
NA
|
|
Down 50
|
|
0.11
|
%
|
|
(0.16
|
)%
|
No Change
|
|
—
|
%
|
|
—
|
%
|
Up 100
|
|
1.12
|
%
|
|
1.38
|
%
|
Up 200
|
|
2.18
|
%
|
|
3.01
|
%
|
|
|
Estimated Maturity or Repricing at December 31, 2018
|
||||||||||||||||||
|
|
Within 3 Months
|
|
3-12 Months
|
|
1-5 Years
|
|
After 5 Years
|
|
Total
|
||||||||||
|
|
(Dollars in Thousands)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Short-term investments
|
|
$
|
63,227
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
63,227
|
|
Investment securities
|
|
4,526
|
|
|
24,403
|
|
|
101,367
|
|
|
47,152
|
|
|
177,448
|
|
|||||
Commercial loans
|
|
206,577
|
|
|
36,885
|
|
|
100,339
|
|
|
12,718
|
|
|
356,519
|
|
|||||
Real estate loans
|
|
393,760
|
|
|
62,887
|
|
|
430,532
|
|
|
169,591
|
|
|
1,056,770
|
|
|||||
Asset-based loans
|
|
154,312
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
154,312
|
|
|||||
Lease receivables
|
|
1,387
|
|
|
6,423
|
|
|
16,301
|
|
|
3,155
|
|
|
27,266
|
|
|||||
Consumer loans
|
|
2,508
|
|
|
291
|
|
|
319
|
|
|
—
|
|
|
3,118
|
|
|||||
Total earning assets
(1)
|
|
$
|
826,297
|
|
|
$
|
130,889
|
|
|
$
|
648,858
|
|
|
$
|
232,616
|
|
|
$
|
1,838,660
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest-bearing transaction
|
|
$
|
229,612
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
229,612
|
|
Money market accounts
|
|
516,045
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
516,045
|
|
|||||
Time deposits under $250,000
|
|
19,744
|
|
|
159,584
|
|
|
170,853
|
|
|
19,786
|
|
|
369,967
|
|
|||||
Time deposits $250,000 and over
|
|
6,419
|
|
|
38,941
|
|
|
13,326
|
|
|
—
|
|
|
58,686
|
|
|||||
FHLB advances
|
|
17,000
|
|
|
72,500
|
|
|
148,500
|
|
|
36,500
|
|
|
274,500
|
|
|||||
Short-term borrowings
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Long-term debt
(2)
|
|
—
|
|
|
15,000
|
|
|
675
|
|
|
19,405
|
|
|
35,080
|
|
|||||
Total interest-bearing liabilities
|
|
$
|
788,820
|
|
|
$
|
286,025
|
|
|
$
|
333,354
|
|
|
$
|
75,691
|
|
|
$
|
1,483,890
|
|
Interest rate gap
|
|
$
|
37,477
|
|
|
$
|
(155,136
|
)
|
|
$
|
315,504
|
|
|
$
|
156,925
|
|
|
$
|
354,770
|
|
Cumulative interest rate gap
|
|
$
|
37,477
|
|
|
$
|
(117,659
|
)
|
|
$
|
197,845
|
|
|
$
|
354,770
|
|
|
|
||
Cumulative interest rate gap to total earning assets
|
|
2.04
|
%
|
|
(6.40
|
)%
|
|
10.76
|
%
|
|
19.30
|
%
|
|
|
(1)
|
Excludes non-interest sensitive balances and balances with indeterminate maturities.
|
(2)
|
Excludes debt issuance costs.
|
|
|
Estimated Maturity or Repricing at December 31, 2017
|
||||||||||||||||||
|
|
Within 3 Months
|
|
3-12 Months
|
|
1-5 Years
|
|
After 5 Years
|
|
Total
|
||||||||||
|
|
(Dollars in Thousands)
|
||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Short-term investments
|
|
$
|
35,481
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
35,481
|
|
Investment securities
|
|
6,544
|
|
|
26,503
|
|
|
93,744
|
|
|
37,872
|
|
|
164,663
|
|
|||||
Commercial loans
|
|
218,017
|
|
|
28,088
|
|
|
75,968
|
|
|
6,283
|
|
|
328,356
|
|
|||||
Real estate loans
|
|
333,742
|
|
|
86,250
|
|
|
385,445
|
|
|
177,524
|
|
|
982,961
|
|
|||||
Asset-based loans
|
|
145,388
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
145,388
|
|
|||||
Lease receivables
|
|
878
|
|
|
5,297
|
|
|
13,824
|
|
|
2,234
|
|
|
22,233
|
|
|||||
Consumer loans
|
|
2,008
|
|
|
337
|
|
|
499
|
|
|
—
|
|
|
2,844
|
|
|||||
Total earning assets
(1)
|
|
$
|
742,058
|
|
|
$
|
146,475
|
|
|
$
|
569,480
|
|
|
$
|
223,913
|
|
|
$
|
1,681,926
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest-bearing transaction
|
|
$
|
217,625
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
217,625
|
|
Money market accounts
|
|
515,078
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
515,078
|
|
|||||
Time deposits under $250,000
|
|
14,854
|
|
|
149,610
|
|
|
182,068
|
|
|
24,988
|
|
|
371,520
|
|
|||||
Time deposits $250,000 and over
|
|
998
|
|
|
6,509
|
|
|
5,157
|
|
|
—
|
|
|
12,664
|
|
|||||
FHLB advances
|
|
5,000
|
|
|
10,000
|
|
|
133,000
|
|
|
35,500
|
|
|
183,500
|
|
|||||
Short-term borrowings
|
|
10
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10
|
|
|||||
Long-term debt
(2)
|
|
—
|
|
|
—
|
|
|
15,675
|
|
|
19,405
|
|
|
35,080
|
|
|||||
Total interest-bearing liabilities
|
|
$
|
753,565
|
|
|
$
|
166,119
|
|
|
$
|
335,900
|
|
|
$
|
79,893
|
|
|
$
|
1,335,477
|
|
Interest rate gap
|
|
$
|
(11,507
|
)
|
|
$
|
(19,644
|
)
|
|
$
|
233,580
|
|
|
$
|
144,020
|
|
|
$
|
346,449
|
|
Cumulative interest rate gap
|
|
$
|
(11,507
|
)
|
|
$
|
(31,151
|
)
|
|
$
|
202,429
|
|
|
$
|
346,449
|
|
|
|
||
Cumulative interest rate gap to total earning assets
|
|
(0.68
|
)%
|
|
(1.85
|
)%
|
|
12.04
|
%
|
|
20.60
|
%
|
|
|
(1)
|
Excludes non-interest sensitive balances and balances with indeterminate maturities.
|
(2)
|
Excludes debt issuance costs.
|
Item 8.
|
Financial Statements and Supplementary Data
|
|
|
|
Consolidated Financial Statements
|
|
Page No.
|
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
|
(In Thousands, Except Share Data)
|
|||||||
Assets
|
|
|
|
|
||||
Cash and due from banks
|
|
$
|
23,319
|
|
|
$
|
17,059
|
|
Short-term investments
|
|
63,227
|
|
|
35,480
|
|
||
Cash and cash equivalents
|
|
86,546
|
|
|
52,539
|
|
||
Securities available-for-sale, at fair value
|
|
138,358
|
|
|
126,005
|
|
||
Securities held-to-maturity, at amortized cost
|
|
37,731
|
|
|
37,778
|
|
||
Loans held for sale
|
|
5,287
|
|
|
2,194
|
|
||
Loans and leases receivable, net of allowance for loan and lease losses of $20,425 and $18,763, respectively
|
|
1,597,230
|
|
|
1,482,832
|
|
||
Premises and equipment, net
|
|
3,284
|
|
|
3,156
|
|
||
Foreclosed properties
|
|
2,547
|
|
|
1,069
|
|
||
Bank-owned life insurance
|
|
41,538
|
|
|
40,323
|
|
||
Federal Home Loan Bank stock, at cost
|
|
7,240
|
|
|
5,670
|
|
||
Goodwill and other intangible assets
|
|
12,045
|
|
|
12,652
|
|
||
Accrued interest receivable and other assets
|
|
34,651
|
|
|
29,848
|
|
||
Total assets
|
|
$
|
1,966,457
|
|
|
$
|
1,794,066
|
|
Liabilities and Stockholders’ Equity
|
|
|
|
|
||||
Deposits
|
|
$
|
1,455,299
|
|
|
$
|
1,394,331
|
|
Federal Home Loan Bank advances and other borrowings
|
|
298,944
|
|
|
207,898
|
|
||
Junior subordinated notes
|
|
10,033
|
|
|
10,019
|
|
||
Accrued interest payable and other liabilities
|
|
21,474
|
|
|
12,540
|
|
||
Total liabilities
|
|
1,785,750
|
|
|
1,624,788
|
|
||
Stockholders’ equity:
|
|
|
|
|
||||
Preferred stock, $0.01 par value, 2,500,000 shares authorized, none issued or outstanding
|
|
—
|
|
|
—
|
|
||
Common stock, $0.01 par value, 25,000,000 shares authorized, 9,069,199 and 9,021,985 shares issued, 8,785,480 and 8,763,539 shares outstanding at December 31, 2018 and 2017, respectively
|
|
91
|
|
|
90
|
|
||
Additional paid-in capital
|
|
79,623
|
|
|
78,620
|
|
||
Retained earnings
|
|
110,310
|
|
|
98,906
|
|
||
Accumulated other comprehensive loss
|
|
(1,684
|
)
|
|
(1,238
|
)
|
||
Treasury stock, 283,719 and 258,446 shares at December 31, 2018 and 2017, respectively, at cost
|
|
(7,633
|
)
|
|
(7,100
|
)
|
||
Total stockholders’ equity
|
|
180,707
|
|
|
169,278
|
|
||
Total liabilities and stockholders’ equity
|
|
$
|
1,966,457
|
|
|
$
|
1,794,066
|
|
|
|
For the Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(In Thousands, Except Share Data)
|
||||||||||
Interest income
|
|
|
|
|
|
|
||||||
Loans and leases
|
|
$
|
86,228
|
|
|
$
|
71,960
|
|
|
$
|
74,627
|
|
Securities
|
|
3,842
|
|
|
3,148
|
|
|
2,845
|
|
|||
Short-term investments
|
|
1,205
|
|
|
703
|
|
|
645
|
|
|||
Total interest income
|
|
91,275
|
|
|
75,811
|
|
|
78,117
|
|
|||
Interest expense
|
|
|
|
|
|
|
||||||
Deposits
|
|
15,533
|
|
|
10,805
|
|
|
11,716
|
|
|||
Federal Home Loan Bank advances and other borrowings
|
|
7,288
|
|
|
3,285
|
|
|
1,958
|
|
|||
Junior subordinated notes
|
|
1,112
|
|
|
1,112
|
|
|
1,115
|
|
|||
Total interest expense
|
|
23,933
|
|
|
15,202
|
|
|
14,789
|
|
|||
Net interest income
|
|
67,342
|
|
|
60,609
|
|
|
63,328
|
|
|||
Provision for loan and lease losses
|
|
5,492
|
|
|
6,172
|
|
|
7,818
|
|
|||
Net interest income after provision for loan and lease losses
|
|
61,850
|
|
|
54,437
|
|
|
55,510
|
|
|||
Non-interest income
|
|
|
|
|
|
|
||||||
Trust and investment service fees
|
|
7,744
|
|
|
6,670
|
|
|
5,356
|
|
|||
Gain on sale of Small Business Administration loans
|
|
1,451
|
|
|
1,591
|
|
|
4,400
|
|
|||
Gain on sale of residential mortgage loans
|
|
—
|
|
|
26
|
|
|
590
|
|
|||
Service charges on deposits
|
|
3,062
|
|
|
3,013
|
|
|
2,990
|
|
|||
Loan fees
|
|
1,783
|
|
|
1,988
|
|
|
2,430
|
|
|||
Increase in cash surrender value of bank-owned life insurance
|
|
1,191
|
|
|
1,250
|
|
|
974
|
|
|||
Net (loss) gain on sale of securities
|
|
(4
|
)
|
|
(403
|
)
|
|
10
|
|
|||
Swap fees
|
|
1,670
|
|
|
909
|
|
|
76
|
|
|||
Other non-interest income
|
|
1,270
|
|
|
1,621
|
|
|
1,162
|
|
|||
Total non-interest income
|
|
18,167
|
|
|
16,665
|
|
|
17,988
|
|
|||
Non-interest expense
|
|
|
|
|
|
|
||||||
Compensation
|
|
37,439
|
|
|
31,663
|
|
|
31,545
|
|
|||
Occupancy
|
|
2,192
|
|
|
2,088
|
|
|
2,019
|
|
|||
Professional fees
|
|
3,869
|
|
|
4,063
|
|
|
4,031
|
|
|||
Data processing
|
|
2,362
|
|
|
2,701
|
|
|
3,298
|
|
|||
Marketing
|
|
2,135
|
|
|
2,109
|
|
|
2,338
|
|
|||
Equipment
|
|
1,434
|
|
|
1,211
|
|
|
1,189
|
|
|||
Computer software
|
|
3,015
|
|
|
2,723
|
|
|
2,160
|
|
|||
FDIC insurance
|
|
1,478
|
|
|
1,388
|
|
|
1,472
|
|
|||
Collateral liquidation costs
|
|
646
|
|
|
829
|
|
|
262
|
|
|||
Net loss (gain) on foreclosed properties
|
|
367
|
|
|
(143
|
)
|
|
122
|
|
|||
Impairment of tax credit investments
|
|
2,083
|
|
|
2,784
|
|
|
3,691
|
|
|||
SBA recourse provision
|
|
1,913
|
|
|
2,240
|
|
|
2,068
|
|
|||
Other non-interest expense
|
|
3,430
|
|
|
3,215
|
|
|
2,238
|
|
|||
Total non-interest expense
|
|
62,363
|
|
|
56,871
|
|
|
56,433
|
|
|||
Income before income tax expense
|
|
17,654
|
|
|
14,231
|
|
|
17,065
|
|
|||
Income tax expense
|
|
1,351
|
|
|
2,326
|
|
|
2,156
|
|
|||
Net income
|
|
$
|
16,303
|
|
|
$
|
11,905
|
|
|
$
|
14,909
|
|
Earnings per common share:
|
|
|
|
|
|
|
||||||
Basic
|
|
$
|
1.86
|
|
|
$
|
1.36
|
|
|
$
|
1.71
|
|
Diluted
|
|
1.86
|
|
|
1.36
|
|
|
1.71
|
|
|||
Dividends declared per share
|
|
0.56
|
|
|
0.52
|
|
|
0.48
|
|
|
|
For the Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(In Thousands)
|
||||||||||
Net income
|
|
$
|
16,303
|
|
|
$
|
11,905
|
|
|
$
|
14,909
|
|
Other comprehensive loss, before tax
|
|
|
|
|
|
|
||||||
Securities available-for-sale:
|
|
|
|
|
|
|
||||||
Unrealized securities losses arising during the period
|
|
(662
|
)
|
|
(1,156
|
)
|
|
(902
|
)
|
|||
Reclassification adjustment for net loss (gain) realized in net income
|
|
4
|
|
|
403
|
|
|
(10
|
)
|
|||
Securities held-to-maturity:
|
|
|
|
|
|
|
||||||
Amortization of net unrealized losses transferred from available-for-sale
|
|
70
|
|
|
102
|
|
|
159
|
|
|||
Interest rate swaps:
|
|
|
|
|
|
|
||||||
Unrealized losses on interest rate swaps arising during the period
|
|
(20
|
)
|
|
(122
|
)
|
|
—
|
|
|||
Income tax benefit
|
|
179
|
|
|
279
|
|
|
311
|
|
|||
Total other comprehensive loss
|
|
(429
|
)
|
|
(494
|
)
|
|
(442
|
)
|
|||
Comprehensive income
|
|
$
|
15,874
|
|
|
$
|
11,411
|
|
|
$
|
14,467
|
|
|
|
Common Shares Outstanding
|
|
Common
Stock
|
|
Additional
Paid-in
Capital
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Treasury
Stock
|
|
Total
|
|||||||||||||
|
|
(In Thousands, Except Share Data)
|
|||||||||||||||||||||||||
Balance at December 31, 2015
|
|
8,699,410
|
|
|
$
|
89
|
|
|
$
|
76,549
|
|
|
$
|
80,584
|
|
|
$
|
(80
|
)
|
|
$
|
(6,310
|
)
|
|
$
|
150,832
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,909
|
|
|
—
|
|
|
—
|
|
|
14,909
|
|
||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(442
|
)
|
|
—
|
|
|
(442
|
)
|
||||||
Share-based compensation - restricted shares
|
|
36,864
|
|
|
1
|
|
|
993
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
994
|
|
||||||
Cash dividends ($0.48 per share)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,176
|
)
|
|
—
|
|
|
—
|
|
|
(4,176
|
)
|
||||||
Treasury stock purchased
|
|
(20,418
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(467
|
)
|
|
(467
|
)
|
||||||
Balance at December 31, 2016
|
|
8,715,856
|
|
|
90
|
|
|
77,542
|
|
|
91,317
|
|
|
(522
|
)
|
|
(6,777
|
)
|
|
161,650
|
|
||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,905
|
|
|
—
|
|
|
—
|
|
|
11,905
|
|
||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(494
|
)
|
|
—
|
|
|
(494
|
)
|
||||||
Share-based compensation - restricted shares
|
|
62,746
|
|
|
—
|
|
|
1,078
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,078
|
|
||||||
Cash dividends ($0.52 per share)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,538
|
)
|
|
—
|
|
|
—
|
|
|
(4,538
|
)
|
||||||
Treasury stock purchased
|
|
(15,063
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(323
|
)
|
|
(323
|
)
|
||||||
Deferred tax revaluation adjustment
|
|
—
|
|
|
—
|
|
|
—
|
|
|
222
|
|
|
(222
|
)
|
|
—
|
|
|
—
|
|
||||||
Balance at December 31, 2017
|
|
8,763,539
|
|
|
90
|
|
|
78,620
|
|
|
98,906
|
|
|
(1,238
|
)
|
|
(7,100
|
)
|
|
169,278
|
|
||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16,303
|
|
|
—
|
|
|
—
|
|
|
16,303
|
|
||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(429
|
)
|
|
—
|
|
|
(429
|
)
|
||||||
Share-based compensation - restricted shares
|
|
47,214
|
|
|
1
|
|
|
1,003
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,004
|
|
||||||
Cash dividends ($0.56 per share)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,916
|
)
|
|
—
|
|
|
—
|
|
|
(4,916
|
)
|
||||||
Treasury stock purchased
|
|
(25,273
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(533
|
)
|
|
(533
|
)
|
||||||
Deferred tax revaluation adjustment
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|
(17
|
)
|
|
—
|
|
|
—
|
|
||||||
Balance at December 31, 2018
|
|
8,785,480
|
|
|
$
|
91
|
|
|
$
|
79,623
|
|
|
$
|
110,310
|
|
|
$
|
(1,684
|
)
|
|
$
|
(7,633
|
)
|
|
$
|
180,707
|
|
First Business Financial Services, Inc.
Consolidated Statements of Cash Flows
|
||||||||||||
|
|
For the Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(In Thousands)
|
||||||||||
Operating activities
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
16,303
|
|
|
$
|
11,905
|
|
|
$
|
14,909
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
||||||
Deferred income taxes, net
|
|
(432
|
)
|
|
1,747
|
|
|
(1,108
|
)
|
|||
Impairment of tax credit investments
|
|
2,083
|
|
|
2,784
|
|
|
3,691
|
|
|||
Provision for loan and lease losses
|
|
5,492
|
|
|
6,172
|
|
|
7,818
|
|
|||
Depreciation, amortization and accretion, net
|
|
1,477
|
|
|
1,562
|
|
|
1,515
|
|
|||
Share-based compensation
|
|
1,004
|
|
|
1,078
|
|
|
994
|
|
|||
Net loss (gain) on sale of available-for-sale securities
|
|
4
|
|
|
403
|
|
|
(10
|
)
|
|||
Gain on sale of historic development entity state tax credit
|
|
—
|
|
|
(210
|
)
|
|
—
|
|
|||
Increase in value of bank-owned life insurance policies
|
|
(1,191
|
)
|
|
(1,250
|
)
|
|
(974
|
)
|
|||
Origination of loans for sale
|
|
(91,122
|
)
|
|
(69,966
|
)
|
|
(71,965
|
)
|
|||
Sale of loans originated for sale
|
|
89,480
|
|
|
70,500
|
|
|
78,546
|
|
|||
Gain on sale of loans originated for sale
|
|
(1,451
|
)
|
|
(1,617
|
)
|
|
(4,990
|
)
|
|||
Net loss (gain) on foreclosed properties, including impairment valuation
|
|
367
|
|
|
(143
|
)
|
|
122
|
|
|||
Loan servicing right impairment valuation
|
|
69
|
|
|
—
|
|
|
—
|
|
|||
Excess tax benefit from share-based compensation
|
|
(46
|
)
|
|
(66
|
)
|
|
(142
|
)
|
|||
Returns on investments in limited partnerships
|
|
413
|
|
|
459
|
|
|
250
|
|
|||
Net increase in accrued interest receivable and other assets
|
|
(4,428
|
)
|
|
(2,857
|
)
|
|
(3,861
|
)
|
|||
Net increase in accrued interest payable and other liabilities
|
|
7,672
|
|
|
1,907
|
|
|
1,367
|
|
|||
Net cash provided by operating activities
|
|
25,694
|
|
|
22,408
|
|
|
26,162
|
|
|||
Investing activities
|
|
|
|
|
|
|
||||||
Proceeds from maturities, redemptions and paydowns of available-for-sale securities
|
|
33,225
|
|
|
38,241
|
|
|
43,745
|
|
|||
Proceeds from maturities, redemptions and paydowns of held-to-maturity securities
|
|
4,860
|
|
|
3,808
|
|
|
3,882
|
|
|||
Proceeds from sale of available-for-sale securities
|
|
6,207
|
|
|
40,144
|
|
|
5,227
|
|
|||
Purchases of available-for-sale securities
|
|
(52,763
|
)
|
|
(60,399
|
)
|
|
(56,356
|
)
|
|||
Purchases of held-to-maturity securities
|
|
(4,867
|
)
|
|
(3,016
|
)
|
|
(5,191
|
)
|
|||
Proceeds from sale of foreclosed properties
|
|
357
|
|
|
1,659
|
|
|
83
|
|
|||
Net increase in loans and leases
|
|
(122,014
|
)
|
|
(59,033
|
)
|
|
(22,385
|
)
|
|||
Investments in limited partnerships
|
|
(188
|
)
|
|
(500
|
)
|
|
(750
|
)
|
|||
Returns of investments in limited partnerships
|
|
316
|
|
|
97
|
|
|
541
|
|
|||
Investment in historic development entities
|
|
(905
|
)
|
|
(5,312
|
)
|
|
(3,456
|
)
|
|||
Distribution from historic development entities
|
|
69
|
|
|
—
|
|
|
—
|
|
|||
Proceeds from sale of historic development entity state tax credit
|
|
—
|
|
|
2,764
|
|
|
—
|
|
|||
Investment in Federal Home Loan Bank and Federal Reserve Bank Stock
|
|
(9,018
|
)
|
|
(16,275
|
)
|
|
(1,308
|
)
|
|||
Proceeds from the sale of Federal Home Loan Bank Stock
|
|
7,448
|
|
|
12,736
|
|
|
2,020
|
|
|||
Purchases of leasehold improvements and equipment, net
|
|
(969
|
)
|
|
(1,242
|
)
|
|
(584
|
)
|
|||
Purchases of bank owned life insurance policies
|
|
—
|
|
|
—
|
|
|
(9,750
|
)
|
|||
Premium payment on bank owned life insurance policies
|
|
(24
|
)
|
|
(25
|
)
|
|
(26
|
)
|
|||
Net cash used in investing activities
|
|
(138,266
|
)
|
|
(46,353
|
)
|
|
(44,308
|
)
|
|||
Financing activities
|
|
|
|
|
|
|
||||||
Net increase (decrease) in deposits
|
|
60,968
|
|
|
(144,486
|
)
|
|
(38,256
|
)
|
|||
Repayment of Federal Home Loan Bank advances
|
|
(804,100
|
)
|
|
(656,916
|
)
|
|
(4,500
|
)
|
|||
Proceeds from Federal Home Loan Bank advances
|
|
895,100
|
|
|
806,916
|
|
|
30,000
|
|
|||
Proceeds from issuance of subordinated notes payable
|
|
—
|
|
|
9,090
|
|
|
—
|
|
|||
Repayment of subordinated notes payable
|
|
—
|
|
|
(7,875
|
)
|
|
—
|
|
|||
Net decrease in short-term borrowed funds
|
|
—
|
|
|
(1,000
|
)
|
|
(1,500
|
)
|
|||
Net increase (decrease) in long-term borrowed funds
|
|
60
|
|
|
(1,901
|
)
|
|
998
|
|
First Business Financial Services, Inc.
Consolidated Statements of Cash Flows
|
||||||||||||
|
|
For the Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(In Thousands)
|
||||||||||
Cash dividends paid
|
|
(4,916
|
)
|
|
(4,538
|
)
|
|
(4,176
|
)
|
|||
Purchase of treasury stock
|
|
(533
|
)
|
|
(323
|
)
|
|
(467
|
)
|
|||
Net cash provided by (used in) financing activities
|
|
146,579
|
|
|
(1,033
|
)
|
|
(17,901
|
)
|
|||
Net increase (decrease) in cash and cash equivalents
|
|
34,007
|
|
|
(24,978
|
)
|
|
(36,047
|
)
|
|||
Cash and cash equivalents at the beginning of the period
|
|
52,539
|
|
|
77,517
|
|
|
113,564
|
|
|||
Cash and cash equivalents at the end of the period
|
|
$
|
86,546
|
|
|
$
|
52,539
|
|
|
$
|
77,517
|
|
Supplementary cash flow information
|
|
|
|
|
|
|
||||||
Cash paid during the period for:
|
|
|
|
|
|
|
||||||
Interest paid on deposits and borrowings
|
|
$
|
22,332
|
|
|
$
|
14,872
|
|
|
$
|
14,790
|
|
Income taxes paid
|
|
1,055
|
|
|
2,160
|
|
|
5,554
|
|
|||
Non-cash investing and financing activities:
|
|
|
|
|
|
|
||||||
Transfer of loans from held-to-maturity to held-for-sale
|
|
—
|
|
|
12,896
|
|
|
11,504
|
|
|||
Transfer of loans to foreclosed properties
|
|
2,202
|
|
|
—
|
|
|
—
|
|
|||
Transfer from premises and equipment to foreclosed properties
|
|
—
|
|
|
1,113
|
|
|
—
|
|
|
|
As of December 31, 2018
|
||||||||||||||
|
|
Amortized Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Fair Value
|
||||||||
|
|
(In Thousands)
|
||||||||||||||
Available-for-sale:
|
|
|
|
|
|
|
|
|
||||||||
U.S. government agency securities - government-sponsored enterprises
|
|
$
|
999
|
|
|
$
|
—
|
|
|
$
|
(9
|
)
|
|
$
|
990
|
|
Municipal securities
|
|
5,953
|
|
|
2
|
|
|
(69
|
)
|
|
5,886
|
|
||||
Mortgage backed securities - government issued
|
|
20,007
|
|
|
47
|
|
|
(426
|
)
|
|
19,628
|
|
||||
Mortgage backed securities - government-sponsored enterprises
|
|
110,928
|
|
|
279
|
|
|
(1,729
|
)
|
|
109,478
|
|
||||
Other securities
|
|
2,450
|
|
|
—
|
|
|
(74
|
)
|
|
2,376
|
|
||||
|
|
$
|
140,337
|
|
|
$
|
328
|
|
|
$
|
(2,307
|
)
|
|
$
|
138,358
|
|
|
|
As of December 31, 2017
|
||||||||||||||
|
|
Amortized Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Fair Value
|
||||||||
|
|
(In Thousands)
|
||||||||||||||
Available-for-sale:
|
|
|
|
|
|
|
|
|
||||||||
U.S. government agency securities - government-sponsored enterprises
|
|
$
|
999
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
1,000
|
|
Municipal securities
|
|
9,494
|
|
|
2
|
|
|
(82
|
)
|
|
9,414
|
|
||||
Mortgage backed securities - government issued
|
|
22,313
|
|
|
149
|
|
|
(213
|
)
|
|
22,249
|
|
||||
Mortgage backed securities - government-sponsored enterprises
|
|
91,480
|
|
|
24
|
|
|
(1,199
|
)
|
|
90,305
|
|
||||
Other securities
|
|
3,040
|
|
|
3
|
|
|
(6
|
)
|
|
3,037
|
|
||||
|
|
$
|
127,326
|
|
|
$
|
179
|
|
|
$
|
(1,500
|
)
|
|
$
|
126,005
|
|
|
|
As of December 31, 2018
|
||||||||||||||
|
|
Amortized Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Fair Value
|
||||||||
|
|
(In Thousands)
|
||||||||||||||
Held-to-maturity:
|
|
|
|
|
|
|
|
|
||||||||
Municipal securities
|
|
$
|
21,066
|
|
|
$
|
72
|
|
|
$
|
(59
|
)
|
|
$
|
21,079
|
|
Mortgage backed securities - government issued
|
|
7,358
|
|
|
—
|
|
|
(172
|
)
|
|
7,186
|
|
||||
Mortgage backed securities - government-sponsored enterprises
|
|
9,307
|
|
|
2
|
|
|
(165
|
)
|
|
9,144
|
|
||||
|
|
$
|
37,731
|
|
|
$
|
74
|
|
|
$
|
(396
|
)
|
|
$
|
37,409
|
|
|
|
As of December 31, 2017
|
||||||||||||||
|
|
Amortized Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Fair Value
|
||||||||
|
|
(In Thousands)
|
||||||||||||||
Held-to-maturity:
|
|
|
|
|
|
|
|
|
||||||||
U.S. government agency securities - government-sponsored enterprises
|
|
$
|
1,499
|
|
|
$
|
—
|
|
|
$
|
(9
|
)
|
|
$
|
1,490
|
|
Municipal securities
|
|
21,680
|
|
|
176
|
|
|
(34
|
)
|
|
21,822
|
|
||||
Mortgage backed securities - government issued
|
|
9,072
|
|
|
1
|
|
|
(130
|
)
|
|
8,943
|
|
||||
Mortgage backed securities - government-sponsored enterprises
|
|
5,527
|
|
|
—
|
|
|
(86
|
)
|
|
5,441
|
|
||||
|
|
$
|
37,778
|
|
|
$
|
177
|
|
|
$
|
(259
|
)
|
|
$
|
37,696
|
|
|
|
For the Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(In Thousands)
|
||||||||||
Gross gains
|
|
$
|
22
|
|
|
$
|
92
|
|
|
$
|
10
|
|
Gross losses
|
|
(26
|
)
|
|
(495
|
)
|
|
—
|
|
|||
Net (losses) gains on sale of available-for-sale securities
|
|
$
|
(4
|
)
|
|
$
|
(403
|
)
|
|
$
|
10
|
|
Proceeds from sale of available-for-sale securities
|
|
$
|
6,207
|
|
|
$
|
40,144
|
|
|
$
|
5,227
|
|
|
|
Available-for-Sale
|
|
Held-to-Maturity
|
||||||||||||
|
|
Amortized Cost
|
|
Fair Value
|
|
Amortized Cost
|
|
Fair Value
|
||||||||
|
|
(In Thousands)
|
||||||||||||||
Due in one year or less
|
|
$
|
1,801
|
|
|
$
|
1,800
|
|
|
$
|
771
|
|
|
$
|
771
|
|
Due in one year through five years
|
|
21,353
|
|
|
21,027
|
|
|
11,834
|
|
|
11,822
|
|
||||
Due in five through ten years
|
|
26,957
|
|
|
26,536
|
|
|
19,053
|
|
|
18,839
|
|
||||
Due in over ten years
|
|
90,226
|
|
|
88,995
|
|
|
6,073
|
|
|
5,977
|
|
||||
|
|
$
|
140,337
|
|
|
$
|
138,358
|
|
|
$
|
37,731
|
|
|
$
|
37,409
|
|
|
|
December 31, 2018
|
||||||||||||||||||||||
|
|
Less than 12 Months
|
|
12 Months or Longer
|
|
Total
|
||||||||||||||||||
|
|
Fair Value
|
|
Unrealized
Losses |
|
Fair Value
|
|
Unrealized
Losses |
|
Fair Value
|
|
Unrealized
Losses |
||||||||||||
|
|
(In Thousands)
|
||||||||||||||||||||||
Available-for-sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. Government agency securities - government-sponsored enterprises
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
990
|
|
|
$
|
9
|
|
|
$
|
990
|
|
|
$
|
9
|
|
Municipal securities
|
|
—
|
|
|
—
|
|
|
4,371
|
|
|
69
|
|
|
4,371
|
|
|
69
|
|
||||||
Mortgage backed securities - government issued
|
|
—
|
|
|
—
|
|
|
13,748
|
|
|
426
|
|
|
13,748
|
|
|
426
|
|
||||||
Mortgage backed securities - government-sponsored enterprises
|
|
8,178
|
|
|
46
|
|
|
69,602
|
|
|
1,683
|
|
|
77,780
|
|
|
1,729
|
|
||||||
Other securities
|
|
238
|
|
|
7
|
|
|
2,138
|
|
|
67
|
|
|
2,376
|
|
|
74
|
|
||||||
|
|
$
|
8,416
|
|
|
$
|
53
|
|
|
$
|
90,849
|
|
|
$
|
2,254
|
|
|
$
|
99,265
|
|
|
$
|
2,307
|
|
|
|
December 31, 2017
|
||||||||||||||||||||||
|
|
Less than 12 Months
|
|
12 Months or Longer
|
|
Total
|
||||||||||||||||||
|
|
Fair Value
|
|
Unrealized
Losses |
|
Fair Value
|
|
Unrealized
Losses |
|
Fair Value
|
|
Unrealized
Losses |
||||||||||||
|
|
(In Thousands)
|
||||||||||||||||||||||
Available-for-sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Municipal securities
|
|
$
|
6,132
|
|
|
$
|
43
|
|
|
$
|
2,755
|
|
|
$
|
39
|
|
|
$
|
8,887
|
|
|
$
|
82
|
|
Mortgage backed securities - government issued
|
|
7,104
|
|
|
40
|
|
|
6,715
|
|
|
173
|
|
|
13,819
|
|
|
213
|
|
||||||
Mortgage backed securities - government-sponsored enterprises
|
|
59,256
|
|
|
476
|
|
|
28,004
|
|
|
723
|
|
|
87,260
|
|
|
1,199
|
|
||||||
Other securities
|
|
1,954
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
1,954
|
|
|
6
|
|
||||||
|
|
$
|
74,446
|
|
|
$
|
565
|
|
|
$
|
37,474
|
|
|
$
|
935
|
|
|
$
|
111,920
|
|
|
$
|
1,500
|
|
|
|
December 31, 2018
|
||||||||||||||||||||||
|
|
Less than 12 Months
|
|
12 Months or Longer
|
|
Total
|
||||||||||||||||||
|
|
Fair Value
|
|
Unrealized
Losses |
|
Fair Value
|
|
Unrealized
Losses |
|
Fair Value
|
|
Unrealized
Losses |
||||||||||||
|
|
(In Thousands)
|
||||||||||||||||||||||
Held-to-maturity:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Municipal securities
|
|
$
|
6,876
|
|
|
$
|
14
|
|
|
$
|
4,364
|
|
|
$
|
45
|
|
|
$
|
11,240
|
|
|
$
|
59
|
|
Mortgage backed securities - government issued
|
|
—
|
|
|
—
|
|
|
7,186
|
|
|
172
|
|
|
7,186
|
|
|
172
|
|
||||||
Mortgage backed securities - government-sponsored enterprises
|
|
4,038
|
|
|
24
|
|
|
4,338
|
|
|
141
|
|
|
8,376
|
|
|
165
|
|
||||||
|
|
$
|
10,914
|
|
|
$
|
38
|
|
|
$
|
15,888
|
|
|
$
|
358
|
|
|
$
|
26,802
|
|
|
$
|
396
|
|
|
|
December 31, 2017
|
||||||||||||||||||||||
|
|
Less than 12 Months
|
|
12 Months or Longer
|
|
Total
|
||||||||||||||||||
|
|
Fair Value
|
|
Unrealized
Losses |
|
Fair Value
|
|
Unrealized
Losses |
|
Fair Value
|
|
Unrealized
Losses |
||||||||||||
|
|
(In Thousands)
|
||||||||||||||||||||||
Held-to-maturity:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. government agency securities - government-sponsored enterprises
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,499
|
|
|
$
|
9
|
|
|
$
|
1,499
|
|
|
$
|
9
|
|
Municipal securities
|
|
3,723
|
|
|
27
|
|
|
259
|
|
|
7
|
|
|
3,982
|
|
|
34
|
|
||||||
Mortgage backed securities - government issued
|
|
3,868
|
|
|
51
|
|
|
4,677
|
|
|
79
|
|
|
8,545
|
|
|
130
|
|
||||||
Mortgage backed securities - government-sponsored enterprises
|
|
—
|
|
|
—
|
|
|
5,527
|
|
|
86
|
|
|
5,527
|
|
|
86
|
|
||||||
|
|
$
|
7,591
|
|
|
$
|
78
|
|
|
$
|
11,962
|
|
|
$
|
181
|
|
|
$
|
19,553
|
|
|
$
|
259
|
|
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
|
|
(In Thousands)
|
||||||
Commercial real estate:
|
|
|
|
|
||||
Commercial real estate — owner occupied
|
|
$
|
203,476
|
|
|
$
|
200,387
|
|
Commercial real estate — non-owner occupied
|
|
484,427
|
|
|
470,236
|
|
||
Land development
|
|
42,666
|
|
|
40,154
|
|
||
Construction
|
|
161,562
|
|
|
125,157
|
|
||
Multi-family
|
|
167,868
|
|
|
136,978
|
|
||
1-4 family
|
|
34,340
|
|
|
44,976
|
|
||
Total commercial real estate
|
|
1,094,339
|
|
|
1,017,888
|
|
||
Commercial and industrial
|
|
462,321
|
|
|
429,002
|
|
||
Direct financing leases, net
|
|
33,170
|
|
|
30,787
|
|
||
Consumer and other:
|
|
|
|
|
||||
Home equity and second mortgages
|
|
8,438
|
|
|
7,262
|
|
||
Other
|
|
20,789
|
|
|
18,099
|
|
||
Total consumer and other
|
|
29,227
|
|
|
25,361
|
|
||
Total gross loans and leases receivable
|
|
1,619,057
|
|
|
1,503,038
|
|
||
Less:
|
|
|
|
|
||||
Allowance for loan and lease losses
|
|
20,425
|
|
|
18,763
|
|
||
Deferred loan fees
|
|
1,402
|
|
|
1,443
|
|
||
Loans and leases receivable, net
|
|
$
|
1,597,230
|
|
|
$
|
1,482,832
|
|
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
|
|
(In Thousands)
|
||||||
Retained, unguaranteed portions of sold SBA loans
|
|
$
|
23,898
|
|
|
$
|
30,071
|
|
Other SBA loans
(1)
|
|
22,024
|
|
|
22,254
|
|
||
Total SBA loans
|
|
$
|
45,922
|
|
|
$
|
52,325
|
|
(1)
|
Primarily consisted of SBA CAPLine, Express and impaired loans that were repurchased from the secondary market, all of which were not saleable as of December 31, 2018 and 2017.
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
|
|
(In Thousands)
|
||||||
Balance at beginning of year
|
|
$
|
10,513
|
|
|
$
|
6,332
|
|
New loans
|
|
5,014
|
|
|
8,269
|
|
||
Repayments
|
|
(6,304
|
)
|
|
(4,088
|
)
|
||
Change due to status of executive officers and directors
|
|
(7,368
|
)
|
|
—
|
|
||
Balance at end of year
|
|
$
|
1,855
|
|
|
$
|
10,513
|
|
|
|
December 31, 2018
|
||||||||||||||||||
|
|
Category
|
|
|
||||||||||||||||
|
|
I
|
|
II
|
|
III
|
|
IV
|
|
Total
|
||||||||||
|
|
(Dollars in Thousands)
|
||||||||||||||||||
Commercial real estate:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial real estate — owner occupied
|
|
$
|
177,222
|
|
|
$
|
15,085
|
|
|
$
|
5,506
|
|
|
$
|
5,663
|
|
|
$
|
203,476
|
|
Commercial real estate — non-owner occupied
|
|
458,185
|
|
|
24,873
|
|
|
1,338
|
|
|
31
|
|
|
484,427
|
|
|||||
Land development
|
|
39,472
|
|
|
981
|
|
|
—
|
|
|
2,213
|
|
|
42,666
|
|
|||||
Construction
|
|
161,360
|
|
|
—
|
|
|
202
|
|
|
—
|
|
|
161,562
|
|
|||||
Multi-family
|
|
167,868
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
167,868
|
|
|||||
1-4 family
|
|
32,004
|
|
|
1,451
|
|
|
707
|
|
|
178
|
|
|
34,340
|
|
|||||
Total commercial real estate
|
|
1,036,111
|
|
|
42,390
|
|
|
7,753
|
|
|
8,085
|
|
|
1,094,339
|
|
|||||
Commercial and industrial
|
|
374,371
|
|
|
19,370
|
|
|
51,474
|
|
|
17,106
|
|
|
462,321
|
|
|||||
Direct financing leases, net
|
|
26,013
|
|
|
6,090
|
|
|
1,067
|
|
|
—
|
|
|
33,170
|
|
|||||
Consumer and other:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Home equity and second mortgages
|
|
8,385
|
|
|
3
|
|
|
50
|
|
|
—
|
|
|
8,438
|
|
|||||
Other
|
|
20,499
|
|
|
—
|
|
|
—
|
|
|
290
|
|
|
20,789
|
|
|||||
Total consumer and other
|
|
28,884
|
|
|
3
|
|
|
50
|
|
|
290
|
|
|
29,227
|
|
|||||
Total gross loans and leases receivable
|
|
$
|
1,465,379
|
|
|
$
|
67,853
|
|
|
$
|
60,344
|
|
|
$
|
25,481
|
|
|
$
|
1,619,057
|
|
Category as a % of total portfolio
|
|
90.51
|
%
|
|
4.19
|
%
|
|
3.73
|
%
|
|
1.57
|
%
|
|
100.00
|
%
|
|
|
December 31, 2017
|
||||||||||||||||||
|
|
Category
|
|
|
||||||||||||||||
|
|
I
|
|
II
|
|
III
|
|
IV
|
|
Total
|
||||||||||
|
|
(Dollars in Thousands)
|
||||||||||||||||||
Commercial real estate:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial real estate — owner occupied
|
|
$
|
166,018
|
|
|
$
|
18,442
|
|
|
$
|
8,850
|
|
|
$
|
7,077
|
|
|
$
|
200,387
|
|
Commercial real estate — non-owner occupied
|
|
441,246
|
|
|
27,854
|
|
|
1,102
|
|
|
34
|
|
|
470,236
|
|
|||||
Land development
|
|
36,470
|
|
|
1,057
|
|
|
—
|
|
|
2,627
|
|
|
40,154
|
|
|||||
Construction
|
|
121,528
|
|
|
757
|
|
|
—
|
|
|
2,872
|
|
|
125,157
|
|
|||||
Multi-family
|
|
136,978
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
136,978
|
|
|||||
1-4 family
|
|
34,598
|
|
|
7,735
|
|
|
1,220
|
|
|
1,423
|
|
|
44,976
|
|
|||||
Total commercial real estate
|
|
936,838
|
|
|
55,845
|
|
|
11,172
|
|
|
14,033
|
|
|
1,017,888
|
|
|||||
Commercial and industrial
|
|
341,875
|
|
|
25,344
|
|
|
49,453
|
|
|
12,330
|
|
|
429,002
|
|
|||||
Direct financing leases, net
|
|
28,866
|
|
|
342
|
|
|
1,579
|
|
|
—
|
|
|
30,787
|
|
|||||
Consumer and other:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Home equity and second mortgages
|
|
7,250
|
|
|
8
|
|
|
—
|
|
|
4
|
|
|
7,262
|
|
|||||
Other
|
|
17,745
|
|
|
—
|
|
|
—
|
|
|
354
|
|
|
18,099
|
|
|||||
Total consumer and other
|
|
24,995
|
|
|
8
|
|
|
—
|
|
|
358
|
|
|
25,361
|
|
|||||
Total gross loans and leases receivable
|
|
$
|
1,332,574
|
|
|
$
|
81,539
|
|
|
$
|
62,204
|
|
|
$
|
26,721
|
|
|
$
|
1,503,038
|
|
Category as a % of total portfolio
|
|
88.66
|
%
|
|
5.42
|
%
|
|
4.14
|
%
|
|
1.78
|
%
|
|
100.00
|
%
|
|
|
December 31, 2018
|
||||||||||||||||||||||
|
|
30-59
Days Past Due |
|
60-89
Days Past Due |
|
Greater
Than 90 Days Past Due |
|
Total Past Due
|
|
Current
|
|
Total Loans and Leases
|
||||||||||||
|
|
(Dollars in Thousands)
|
||||||||||||||||||||||
Accruing loans and leases
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commercial real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Owner occupied
|
|
$
|
157
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
157
|
|
|
$
|
197,656
|
|
|
$
|
197,813
|
|
Non-owner occupied
|
|
—
|
|
|
2,272
|
|
|
—
|
|
|
2,272
|
|
|
482,124
|
|
|
484,396
|
|
||||||
Land development
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
40,453
|
|
|
40,453
|
|
||||||
Construction
|
|
14,824
|
|
|
—
|
|
|
—
|
|
|
14,824
|
|
|
146,738
|
|
|
161,562
|
|
||||||
Multi-family
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
167,868
|
|
|
167,868
|
|
||||||
1-4 family
|
|
363
|
|
|
60
|
|
|
—
|
|
|
423
|
|
|
33,917
|
|
|
34,340
|
|
||||||
Commercial and industrial
|
|
826
|
|
|
247
|
|
|
—
|
|
|
1,073
|
|
|
444,144
|
|
|
445,217
|
|
||||||
Direct financing leases, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
33,170
|
|
|
33,170
|
|
||||||
Consumer and other:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Home equity and second mortgages
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,438
|
|
|
8,438
|
|
||||||
Other
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20,499
|
|
|
20,499
|
|
||||||
Total
|
|
16,170
|
|
|
2,579
|
|
|
—
|
|
|
18,749
|
|
|
1,575,007
|
|
|
1,593,756
|
|
||||||
Non-accruing loans and leases
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commercial real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Owner occupied
|
|
483
|
|
|
—
|
|
|
5,180
|
|
|
5,663
|
|
|
—
|
|
|
5,663
|
|
||||||
Non-owner occupied
|
|
—
|
|
|
—
|
|
|
31
|
|
|
31
|
|
|
—
|
|
|
31
|
|
||||||
Land development
|
|
—
|
|
|
—
|
|
|
119
|
|
|
119
|
|
|
2,094
|
|
|
2,213
|
|
||||||
Construction
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Multi-family
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
1-4 family
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Commercial and industrial
|
|
2,322
|
|
|
—
|
|
|
12,108
|
|
|
14,430
|
|
|
2,674
|
|
|
17,104
|
|
||||||
Direct financing leases, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Consumer and other:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Home equity and second mortgages
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Other
|
|
—
|
|
|
—
|
|
|
279
|
|
|
279
|
|
|
11
|
|
|
290
|
|
||||||
Total
|
|
2,805
|
|
|
—
|
|
|
17,717
|
|
|
20,522
|
|
|
4,779
|
|
|
25,301
|
|
||||||
Total loans and leases
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commercial real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Owner occupied
|
|
640
|
|
|
—
|
|
|
5,180
|
|
|
5,820
|
|
|
197,656
|
|
|
203,476
|
|
||||||
Non-owner occupied
|
|
—
|
|
|
2,272
|
|
|
31
|
|
|
2,303
|
|
|
482,124
|
|
|
484,427
|
|
||||||
Land development
|
|
—
|
|
|
—
|
|
|
119
|
|
|
119
|
|
|
42,547
|
|
|
42,666
|
|
||||||
Construction
|
|
14,824
|
|
|
—
|
|
|
—
|
|
|
14,824
|
|
|
146,738
|
|
|
161,562
|
|
||||||
Multi-family
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
167,868
|
|
|
167,868
|
|
||||||
1-4 family
|
|
363
|
|
|
60
|
|
|
—
|
|
|
423
|
|
|
33,917
|
|
|
34,340
|
|
||||||
Commercial and industrial
|
|
3,148
|
|
|
247
|
|
|
12,108
|
|
|
15,503
|
|
|
446,818
|
|
|
462,321
|
|
||||||
Direct financing leases, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
33,170
|
|
|
33,170
|
|
||||||
Consumer and other:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Home equity and second mortgages
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,438
|
|
|
8,438
|
|
||||||
Other
|
|
—
|
|
|
—
|
|
|
279
|
|
|
279
|
|
|
20,510
|
|
|
20,789
|
|
||||||
Total
|
|
$
|
18,975
|
|
|
$
|
2,579
|
|
|
$
|
17,717
|
|
|
$
|
39,271
|
|
|
$
|
1,579,786
|
|
|
$
|
1,619,057
|
|
Percent of portfolio
|
|
1.17
|
%
|
|
0.16
|
%
|
|
1.09
|
%
|
|
2.42
|
%
|
|
97.58
|
%
|
|
100.00
|
%
|
|
|
December 31, 2017
|
||||||||||||||||||||||
|
|
30-59
Days Past Due |
|
60-89
Days Past Due |
|
Greater
Than 90 Days Past Due |
|
Total Past Due
|
|
Current
|
|
Total Loans and Leases
|
||||||||||||
|
|
(Dollars in Thousands)
|
||||||||||||||||||||||
Accruing loans and leases
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commercial real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Owner occupied
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
193,366
|
|
|
$
|
193,366
|
|
Non-owner occupied
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
470,202
|
|
|
470,202
|
|
||||||
Land development
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
37,528
|
|
|
37,528
|
|
||||||
Construction
|
|
—
|
|
|
196
|
|
|
—
|
|
|
196
|
|
|
122,089
|
|
|
122,285
|
|
||||||
Multi-family
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
136,978
|
|
|
136,978
|
|
||||||
1-4 family
|
|
496
|
|
|
—
|
|
|
—
|
|
|
496
|
|
|
43,319
|
|
|
43,815
|
|
||||||
Commercial and industrial
|
|
1,169
|
|
|
197
|
|
|
—
|
|
|
1,366
|
|
|
415,315
|
|
|
416,681
|
|
||||||
Direct financing leases, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
30,787
|
|
|
30,787
|
|
||||||
Consumer and other:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Home equity and second mortgages
|
|
106
|
|
|
—
|
|
|
—
|
|
|
106
|
|
|
7,156
|
|
|
7,262
|
|
||||||
Other
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17,745
|
|
|
17,745
|
|
||||||
Total
|
|
1,771
|
|
|
393
|
|
|
—
|
|
|
2,164
|
|
|
1,474,485
|
|
|
1,476,649
|
|
||||||
Non-accruing loans and leases
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commercial real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Owner occupied
|
|
405
|
|
|
—
|
|
|
4,836
|
|
|
5,241
|
|
|
1,780
|
|
|
7,021
|
|
||||||
Non-owner occupied
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
34
|
|
|
34
|
|
||||||
Land development
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,626
|
|
|
2,626
|
|
||||||
Construction
|
|
—
|
|
|
—
|
|
|
2,872
|
|
|
2,872
|
|
|
—
|
|
|
2,872
|
|
||||||
Multi-family
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
1-4 family
|
|
—
|
|
|
—
|
|
|
948
|
|
|
948
|
|
|
213
|
|
|
1,161
|
|
||||||
Commercial and industrial
|
|
782
|
|
|
—
|
|
|
7,349
|
|
|
8,131
|
|
|
4,190
|
|
|
12,321
|
|
||||||
Direct financing leases, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Consumer and other:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Home equity and second mortgages
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Other
|
|
—
|
|
|
—
|
|
|
345
|
|
|
345
|
|
|
9
|
|
|
354
|
|
||||||
Total
|
|
1,187
|
|
|
—
|
|
|
16,350
|
|
|
17,537
|
|
|
8,852
|
|
|
26,389
|
|
||||||
Total loans and leases
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commercial real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Owner occupied
|
|
405
|
|
|
—
|
|
|
4,836
|
|
|
5,241
|
|
|
195,146
|
|
|
200,387
|
|
||||||
Non-owner occupied
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
470,236
|
|
|
470,236
|
|
||||||
Land development
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
40,154
|
|
|
40,154
|
|
||||||
Construction
|
|
—
|
|
|
196
|
|
|
2,872
|
|
|
3,068
|
|
|
122,089
|
|
|
125,157
|
|
||||||
Multi-family
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
136,978
|
|
|
136,978
|
|
||||||
1-4 family
|
|
496
|
|
|
—
|
|
|
948
|
|
|
1,444
|
|
|
43,532
|
|
|
44,976
|
|
||||||
Commercial and industrial
|
|
1,951
|
|
|
197
|
|
|
7,349
|
|
|
9,497
|
|
|
419,505
|
|
|
429,002
|
|
||||||
Direct financing leases, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
30,787
|
|
|
30,787
|
|
||||||
Consumer and other:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Home equity and second mortgages
|
|
106
|
|
|
—
|
|
|
—
|
|
|
106
|
|
|
7,156
|
|
|
7,262
|
|
||||||
Other
|
|
—
|
|
|
—
|
|
|
345
|
|
|
345
|
|
|
17,754
|
|
|
18,099
|
|
||||||
Total
|
|
$
|
2,958
|
|
|
$
|
393
|
|
|
$
|
16,350
|
|
|
$
|
19,701
|
|
|
$
|
1,483,337
|
|
|
$
|
1,503,038
|
|
Percent of portfolio
|
|
0.20
|
%
|
|
0.03
|
%
|
|
1.09
|
%
|
|
1.32
|
%
|
|
98.68
|
%
|
|
100.00
|
%
|
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
|
|
(In Thousands)
|
||||||
Non-accrual loans and leases
|
|
|
|
|
||||
Commercial real estate:
|
|
|
|
|
||||
Commercial real estate — owner occupied
|
|
$
|
5,663
|
|
|
$
|
7,021
|
|
Commercial real estate — non-owner occupied
|
|
31
|
|
|
34
|
|
||
Land development
|
|
2,213
|
|
|
2,626
|
|
||
Construction
|
|
—
|
|
|
2,872
|
|
||
Multi-family
|
|
—
|
|
|
—
|
|
||
1-4 family
|
|
—
|
|
|
1,161
|
|
||
Total non-accrual commercial real estate
|
|
7,907
|
|
|
13,714
|
|
||
Commercial and industrial
|
|
17,104
|
|
|
12,321
|
|
||
Direct financing leases, net
|
|
—
|
|
|
—
|
|
||
Consumer and other:
|
|
|
|
|
||||
Home equity and second mortgages
|
|
—
|
|
|
—
|
|
||
Other
|
|
290
|
|
|
354
|
|
||
Total non-accrual consumer and other loans
|
|
290
|
|
|
354
|
|
||
Total non-accrual loans and leases
|
|
25,301
|
|
|
26,389
|
|
||
Foreclosed properties, net
|
|
2,547
|
|
|
1,069
|
|
||
Total non-performing assets
|
|
27,848
|
|
|
27,458
|
|
||
Performing troubled debt restructurings
|
|
180
|
|
|
332
|
|
||
Total impaired assets
|
|
$
|
28,028
|
|
|
$
|
27,790
|
|
|
|
December 31,
2018 |
|
December 31,
2017 |
||
Total non-accrual loans and leases to gross loans and leases
|
|
1.56
|
%
|
|
1.76
|
%
|
Total non-performing assets to total gross loans and leases plus foreclosed properties, net
|
|
1.72
|
|
|
1.83
|
|
Total non-performing assets to total assets
|
|
1.42
|
|
|
1.53
|
|
Allowance for loan and lease losses to gross loans and leases
|
|
1.26
|
|
|
1.25
|
|
Allowance for loan and lease losses to non-accrual loans and leases
|
|
80.73
|
|
|
71.10
|
|
|
|
For the Year Ended December 31, 2017
|
|||||||||
|
|
Number of Loans
|
|
Pre-Modification
Recorded
Investment
|
|
Post-Modification
Recorded
Investment
|
|||||
|
|
(Dollars in Thousands)
|
|||||||||
Commercial and industrial
|
|
4
|
|
|
$
|
4,374
|
|
|
$
|
4,344
|
|
Consumer and other
|
|
1
|
|
|
17
|
|
|
17
|
|
||
Total
|
|
5
|
|
|
$
|
4,391
|
|
|
$
|
4,361
|
|
|
|
As of and for the Year Ended December 31, 2018
|
||||||||||||||||||||||||||
|
|
Recorded
Investment
(1)
|
|
Unpaid
Principal
Balance
|
|
Impairment
Reserve
|
|
Average
Recorded
Investment
(2)
|
|
Foregone
Interest
Income
|
|
Interest
Income
Recognized
|
|
Net Foregone
Interest
Income
|
||||||||||||||
|
|
(In Thousands)
|
||||||||||||||||||||||||||
With no impairment reserve recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Commercial real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Owner occupied
|
|
$
|
1,273
|
|
|
$
|
1,273
|
|
|
$
|
—
|
|
|
$
|
6,638
|
|
|
$
|
756
|
|
|
$
|
197
|
|
|
$
|
559
|
|
Non-owner occupied
|
|
31
|
|
|
72
|
|
|
—
|
|
|
33
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|||||||
Land development
|
|
2,213
|
|
|
6,510
|
|
|
—
|
|
|
2,366
|
|
|
68
|
|
|
—
|
|
|
68
|
|
|||||||
Construction
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,148
|
|
|
219
|
|
|
—
|
|
|
219
|
|
|||||||
Multi-family
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
1-4 family
|
|
178
|
|
|
183
|
|
|
—
|
|
|
808
|
|
|
42
|
|
|
81
|
|
|
(39
|
)
|
|||||||
Commercial and industrial
|
|
6,828
|
|
|
7,527
|
|
|
—
|
|
|
8,809
|
|
|
1,058
|
|
|
980
|
|
|
78
|
|
|||||||
Direct financing leases, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Consumer and other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Home equity and second mortgages
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
46
|
|
|
(46
|
)
|
|||||||
Other
|
|
279
|
|
|
945
|
|
|
—
|
|
|
305
|
|
|
55
|
|
|
—
|
|
|
55
|
|
|||||||
Total
|
|
10,802
|
|
|
16,510
|
|
|
—
|
|
|
21,108
|
|
|
2,200
|
|
|
1,304
|
|
|
896
|
|
|||||||
With impairment reserve recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Commercial real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Owner occupied
|
|
4,390
|
|
|
5,749
|
|
|
675
|
|
|
635
|
|
|
182
|
|
|
—
|
|
|
182
|
|
|||||||
Non-owner occupied
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Land development
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Construction
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Multi-family
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
1-4 family
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Commercial and industrial
|
|
10,278
|
|
|
10,278
|
|
|
3,710
|
|
|
4,687
|
|
|
1,096
|
|
|
—
|
|
|
1,096
|
|
|||||||
Direct financing leases, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Consumer and other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Home equity and second mortgages
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Other
|
|
11
|
|
|
11
|
|
|
11
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Total
|
|
14,679
|
|
|
16,038
|
|
|
4,396
|
|
|
5,323
|
|
|
1,278
|
|
|
—
|
|
|
1,278
|
|
|||||||
Total:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Commercial real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Owner occupied
|
|
5,663
|
|
|
7,022
|
|
|
675
|
|
|
7,273
|
|
|
938
|
|
|
197
|
|
|
741
|
|
|||||||
Non-owner occupied
|
|
31
|
|
|
72
|
|
|
—
|
|
|
33
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|||||||
Land development
|
|
2,213
|
|
|
6,510
|
|
|
—
|
|
|
2,366
|
|
|
68
|
|
|
—
|
|
|
68
|
|
|||||||
Construction
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,148
|
|
|
219
|
|
|
—
|
|
|
219
|
|
|||||||
Multi-family
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
1-4 family
|
|
178
|
|
|
183
|
|
|
—
|
|
|
808
|
|
|
42
|
|
|
81
|
|
|
(39
|
)
|
|||||||
Commercial and industrial
|
|
17,106
|
|
|
17,805
|
|
|
3,710
|
|
|
13,496
|
|
|
2,154
|
|
|
980
|
|
|
1,174
|
|
|||||||
Direct financing leases, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Consumer and other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Home equity and second mortgages
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
46
|
|
|
(46
|
)
|
|||||||
Other
|
|
290
|
|
|
956
|
|
|
11
|
|
|
306
|
|
|
55
|
|
|
—
|
|
|
55
|
|
|||||||
Grand total
|
|
$
|
25,481
|
|
|
$
|
32,548
|
|
|
$
|
4,396
|
|
|
$
|
26,431
|
|
|
$
|
3,478
|
|
|
$
|
1,304
|
|
|
$
|
2,174
|
|
(1)
|
The recorded investment represents the unpaid principal balance net of any partial charge-offs.
|
(2)
|
Average recorded investment is calculated primarily using daily average balances.
|
|
|
As of and for the Year Ended December 31, 2017
|
||||||||||||||||||||||||||||||
|
|
Recorded
Investment
(1)
|
|
Unpaid
Principal
Balance
|
|
Impairment
Reserve
|
|
Average
Recorded
Investment
(2)
|
|
Foregone
Interest
Income
|
|
Interest
Income
Recognized
|
|
Net Foregone
Interest
Income
|
||||||||||||||||||
|
|
(In Thousands)
|
||||||||||||||||||||||||||||||
With no impairment reserve recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Commercial real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Owner occupied
|
|
$
|
7,077
|
|
|
$
|
7,077
|
|
|
$
|
—
|
|
|
$
|
5,549
|
|
|
$
|
613
|
|
|
$
|
—
|
|
|
$
|
613
|
|
||||
Non-owner occupied
|
|
34
|
|
|
75
|
|
|
—
|
|
|
1,830
|
|
|
97
|
|
|
226
|
|
|
(129
|
)
|
|||||||||||
Land development
|
|
2,627
|
|
|
5,297
|
|
|
—
|
|
|
3,092
|
|
|
84
|
|
|
—
|
|
|
84
|
|
|||||||||||
Construction
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
—
|
|
2,000
|
|
—
|
|
134
|
|
—
|
|
214
|
|
|
(80
|
)
|
|||||||
Multi-family
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||||
1-4 family
|
|
1,423
|
|
|
1,706
|
|
|
—
|
|
|
2,146
|
|
|
53
|
|
|
7
|
|
|
46
|
|
|||||||||||
Commercial and industrial
|
|
5,465
|
|
|
6,502
|
|
|
—
|
|
|
3,634
|
|
|
858
|
|
|
7
|
|
|
851
|
|
|||||||||||
Direct financing leases, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||||
Consumer and other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Home equity and second mortgages
|
|
4
|
|
|
3
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||||
Other
|
|
345
|
|
|
1,011
|
|
|
—
|
|
|
365
|
|
|
59
|
|
|
—
|
|
|
59
|
|
|||||||||||
Total
|
|
16,975
|
|
|
21,671
|
|
|
—
|
|
|
18,624
|
|
|
1,898
|
|
|
454
|
|
|
1,444
|
|
|||||||||||
With impairment reserve recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Commercial real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Owner occupied
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||||
Non-owner occupied
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||||
Land development
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
|||||||
Construction
|
|
2,872
|
|
|
2,872
|
|
—
|
|
415
|
|
—
|
|
2,252
|
|
—
|
|
158
|
|
—
|
|
—
|
|
|
158
|
|
|||||||
Multi-family
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||||
1-4 family
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||||
Commercial and industrial
|
|
6,865
|
|
|
8,813
|
|
|
4,067
|
|
|
12,288
|
|
|
639
|
|
|
—
|
|
|
639
|
|
|||||||||||
Direct financing leases, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||||
Consumer and other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Home equity and second mortgages
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||||
Other
|
|
9
|
|
|
9
|
|
|
9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||||
Total
|
|
9,746
|
|
|
11,694
|
|
|
4,491
|
|
|
14,540
|
|
|
797
|
|
|
—
|
|
|
797
|
|
|||||||||||
Total:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Commercial real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Owner occupied
|
|
7,077
|
|
|
7,077
|
|
|
—
|
|
|
5,549
|
|
|
613
|
|
|
—
|
|
|
613
|
|
|||||||||||
Non-owner occupied
|
|
34
|
|
|
75
|
|
|
—
|
|
|
1,830
|
|
|
97
|
|
|
226
|
|
|
(129
|
)
|
|||||||||||
Land development
|
|
2,627
|
|
|
5,297
|
|
|
—
|
|
|
3,092
|
|
|
84
|
|
|
—
|
|
|
84
|
|
|||||||||||
Construction
|
|
2,872
|
|
|
2,872
|
|
|
415
|
|
|
4,252
|
|
|
292
|
|
|
214
|
|
|
78
|
|
|||||||||||
Multi-family
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||||
1-4 family
|
|
1,423
|
|
|
1,706
|
|
|
—
|
|
|
2,146
|
|
|
53
|
|
|
7
|
|
|
46
|
|
|||||||||||
Commercial and industrial
|
|
12,330
|
|
|
15,315
|
|
|
4,067
|
|
|
15,922
|
|
|
1,497
|
|
|
7
|
|
|
1,490
|
|
|||||||||||
Direct financing leases, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||||
Consumer and other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Home equity and second mortgages
|
|
4
|
|
|
3
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||||
Other
|
|
354
|
|
|
1,020
|
|
|
9
|
|
|
365
|
|
|
59
|
|
|
—
|
|
|
59
|
|
|||||||||||
Grand total
|
|
$
|
26,721
|
|
|
$
|
33,365
|
|
|
$
|
4,491
|
|
|
$
|
33,164
|
|
|
$
|
2,695
|
|
|
$
|
454
|
|
|
$
|
2,241
|
|
(1)
|
The recorded investment represents the unpaid principal balance net of any partial charge-offs.
|
(2)
|
Average recorded investment is calculated primarily using daily average balances.
|
|
|
As of and for the Year Ended December 31, 2016
|
||||||||||||||||||||||||||
|
|
Recorded
Investment
(1)
|
|
Unpaid
Principal
Balance
|
|
Impairment
Reserve
|
|
Average
Recorded
Investment
(2)
|
|
Foregone
Interest
Income
|
|
Interest
Income
Recognized
|
|
Net Foregone
Interest
Income
|
||||||||||||||
|
|
(In Thousands)
|
||||||||||||||||||||||||||
With no impairment reserve recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Commercial real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Owner occupied
|
|
$
|
1,788
|
|
|
$
|
1,788
|
|
|
$
|
—
|
|
|
$
|
3,577
|
|
|
$
|
328
|
|
|
$
|
118
|
|
|
$
|
210
|
|
Non-owner occupied
|
|
1,609
|
|
|
1,647
|
|
|
—
|
|
|
1,318
|
|
|
91
|
|
|
79
|
|
|
12
|
|
|||||||
Land development
|
|
3,440
|
|
|
6,111
|
|
|
—
|
|
|
3,898
|
|
|
107
|
|
|
—
|
|
|
107
|
|
|||||||
Construction
|
|
436
|
|
|
438
|
|
|
—
|
|
|
291
|
|
|
20
|
|
|
—
|
|
|
20
|
|
|||||||
Multi-family
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
134
|
|
|
(133
|
)
|
|||||||
1-4 family
|
|
2,379
|
|
|
2,379
|
|
|
—
|
|
|
2,755
|
|
|
125
|
|
|
94
|
|
|
31
|
|
|||||||
Commercial and industrial
|
|
1,307
|
|
|
1,307
|
|
|
—
|
|
|
709
|
|
|
79
|
|
|
62
|
|
|
17
|
|
|||||||
Direct financing leases, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Consumer and other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Home equity and second mortgages
|
|
8
|
|
|
8
|
|
|
—
|
|
|
307
|
|
|
16
|
|
|
127
|
|
|
(111
|
)
|
|||||||
Other
|
|
378
|
|
|
1,044
|
|
|
—
|
|
|
510
|
|
|
71
|
|
|
—
|
|
|
71
|
|
|||||||
Total
|
|
11,345
|
|
|
14,722
|
|
|
—
|
|
|
13,371
|
|
|
838
|
|
|
614
|
|
|
224
|
|
|||||||
With impairment reserve recorded:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Commercial real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Owner occupied
|
|
499
|
|
|
499
|
|
|
70
|
|
|
111
|
|
|
28
|
|
|
—
|
|
|
28
|
|
|||||||
Non-owner occupied
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Land development
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Construction
|
|
2,482
|
|
|
2,482
|
|
|
1,790
|
|
|
834
|
|
|
45
|
|
|
—
|
|
|
45
|
|
|||||||
Multi-family
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
1-4 family
|
|
193
|
|
|
199
|
|
|
39
|
|
|
203
|
|
|
5
|
|
|
—
|
|
|
5
|
|
|||||||
Commercial and industrial
|
|
11,166
|
|
|
11,166
|
|
|
3,700
|
|
|
8,448
|
|
|
701
|
|
|
—
|
|
|
701
|
|
|||||||
Direct financing leases, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Consumer and other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Home equity and second mortgages
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Other
|
|
226
|
|
|
226
|
|
|
—
|
|
|
19
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Total
|
|
14,566
|
|
|
14,572
|
|
|
5,599
|
|
|
9,615
|
|
|
779
|
|
|
—
|
|
|
779
|
|
|||||||
Total:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Commercial real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Owner occupied
|
|
2,287
|
|
|
2,287
|
|
|
70
|
|
|
3,688
|
|
|
356
|
|
|
118
|
|
|
238
|
|
|||||||
Non-owner occupied
|
|
1,609
|
|
|
1,647
|
|
|
—
|
|
|
1,318
|
|
|
91
|
|
|
79
|
|
|
12
|
|
|||||||
Land development
|
|
3,440
|
|
|
6,111
|
|
|
—
|
|
|
3,898
|
|
|
107
|
|
|
—
|
|
|
107
|
|
|||||||
Construction
|
|
2,918
|
|
|
2,920
|
|
|
1,790
|
|
|
1,125
|
|
|
65
|
|
|
—
|
|
|
65
|
|
|||||||
Multi-family
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
134
|
|
|
(133
|
)
|
|||||||
1-4 family
|
|
2,572
|
|
|
2,578
|
|
|
39
|
|
|
2,958
|
|
|
130
|
|
|
94
|
|
|
36
|
|
|||||||
Commercial and industrial
|
|
12,473
|
|
|
12,473
|
|
|
3,700
|
|
|
9,157
|
|
|
780
|
|
|
62
|
|
|
718
|
|
|||||||
Direct financing leases, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Consumer and other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Home equity and second mortgages
|
|
8
|
|
|
8
|
|
|
—
|
|
|
307
|
|
|
16
|
|
|
127
|
|
|
(111
|
)
|
|||||||
Other
|
|
604
|
|
|
1,270
|
|
|
—
|
|
|
529
|
|
|
71
|
|
|
—
|
|
|
71
|
|
|||||||
Grand total
|
|
$
|
25,911
|
|
|
$
|
29,294
|
|
|
$
|
5,599
|
|
|
$
|
22,986
|
|
|
$
|
1,617
|
|
|
$
|
614
|
|
|
$
|
1,003
|
|
(1)
|
The recorded investment represents the unpaid principal balance net of any partial charge-offs.
|
(2)
|
Average recorded investment is calculated primarily using daily average balances.
|
|
|
As of and for the Year Ended December 31, 2018
|
||||||||||||||
|
|
Commercial
Real Estate
|
|
Commercial
and
Industrial
|
|
Consumer
and Other
|
|
Total
|
||||||||
|
|
(In Thousands)
|
||||||||||||||
Beginning balance
|
|
$
|
10,131
|
|
|
$
|
8,225
|
|
|
$
|
407
|
|
|
$
|
18,763
|
|
Charge-offs
|
|
(4,501
|
)
|
|
(1,545
|
)
|
|
(55
|
)
|
|
(6,101
|
)
|
||||
Recoveries
|
|
174
|
|
|
2,023
|
|
|
74
|
|
|
2,271
|
|
||||
Net (charge-offs) recoveries
|
|
(4,327
|
)
|
|
478
|
|
|
19
|
|
|
(3,830
|
)
|
||||
Provision for loan and lease losses
|
|
5,858
|
|
|
(624
|
)
|
|
258
|
|
|
5,492
|
|
||||
Ending balance
|
|
$
|
11,662
|
|
|
$
|
8,079
|
|
|
$
|
684
|
|
|
$
|
20,425
|
|
|
|
As of and for the Year Ended December 31, 2017
|
||||||||||||||
|
|
Commercial
Real Estate
|
|
Commercial
and
Industrial
|
|
Consumer
and Other
|
|
Total
|
||||||||
|
|
(In Thousands)
|
||||||||||||||
Beginning balance
|
|
$
|
12,384
|
|
|
$
|
7,970
|
|
|
$
|
558
|
|
|
$
|
20,912
|
|
Charge-offs
|
|
(127
|
)
|
|
(8,621
|
)
|
|
(92
|
)
|
|
(8,840
|
)
|
||||
Recoveries
|
|
153
|
|
|
323
|
|
|
43
|
|
|
519
|
|
||||
Net recoveries (charge-offs)
|
|
26
|
|
|
(8,298
|
)
|
|
(49
|
)
|
|
(8,321
|
)
|
||||
Provision for loan and lease losses
|
|
(2,279
|
)
|
|
8,553
|
|
|
(102
|
)
|
|
6,172
|
|
||||
Ending balance
|
|
$
|
10,131
|
|
|
$
|
8,225
|
|
|
$
|
407
|
|
|
$
|
18,763
|
|
|
|
As of and for the Year Ended December 31, 2016
|
||||||||||||||
|
|
Commercial
Real Estate
|
|
Commercial
and
Industrial
|
|
Consumer
and Other
|
|
Total
|
||||||||
|
|
(In Thousands)
|
||||||||||||||
Beginning balance
|
|
$
|
11,220
|
|
|
$
|
4,387
|
|
|
$
|
709
|
|
|
$
|
16,316
|
|
Charge-offs
|
|
(1,194
|
)
|
|
(2,273
|
)
|
|
(127
|
)
|
|
(3,594
|
)
|
||||
Recoveries
|
|
274
|
|
|
91
|
|
|
7
|
|
|
372
|
|
||||
Net charge-offs
|
|
(920
|
)
|
|
(2,182
|
)
|
|
(120
|
)
|
|
(3,222
|
)
|
||||
Provision for loan and lease losses
|
|
2,084
|
|
|
5,765
|
|
|
(31
|
)
|
|
7,818
|
|
||||
Ending balance
|
|
$
|
12,384
|
|
|
$
|
7,970
|
|
|
$
|
558
|
|
|
$
|
20,912
|
|
|
|
December 31, 2018
|
||||||||||||||
|
|
Commercial
Real Estate
|
|
Commercial
and
Industrial
|
|
Consumer
and Other
|
|
Total
|
||||||||
|
|
(In Thousands)
|
||||||||||||||
Allowance for loan and lease losses:
|
|
|
|
|
|
|
|
|
||||||||
Collectively evaluated for impairment
|
|
$
|
10,987
|
|
|
$
|
4,369
|
|
|
$
|
673
|
|
|
$
|
16,029
|
|
Individually evaluated for impairment
|
|
675
|
|
|
3,710
|
|
|
11
|
|
|
4,396
|
|
||||
Loans acquired with deteriorated credit quality
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total
|
|
$
|
11,662
|
|
|
$
|
8,079
|
|
|
$
|
684
|
|
|
$
|
20,425
|
|
Loans and lease receivables:
|
|
|
|
|
|
|
|
|
||||||||
Collectively evaluated for impairment
|
|
$
|
1,086,254
|
|
|
$
|
478,385
|
|
|
$
|
28,937
|
|
|
1,593,576
|
|
|
Individually evaluated for impairment
|
|
7,914
|
|
|
17,104
|
|
|
290
|
|
|
25,308
|
|
||||
Loans acquired with deteriorated credit quality
|
|
171
|
|
|
2
|
|
|
—
|
|
|
173
|
|
||||
Total
|
|
$
|
1,094,339
|
|
|
$
|
495,491
|
|
|
$
|
29,227
|
|
|
$
|
1,619,057
|
|
|
|
December 31, 2017
|
||||||||||||||
|
|
Commercial
Real Estate
|
|
Commercial
and
Industrial
|
|
Consumer
and Other
|
|
Total
|
||||||||
|
|
(In Thousands)
|
||||||||||||||
Allowance for loan and lease losses:
|
|
|
|
|
|
|
|
|
||||||||
Collectively evaluated for impairment
|
|
$
|
9,716
|
|
|
$
|
4,158
|
|
|
$
|
398
|
|
|
$
|
14,272
|
|
Individually evaluated for impairment
|
|
415
|
|
|
4,067
|
|
|
9
|
|
|
4,491
|
|
||||
Loans acquired with deteriorated credit quality
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total
|
|
$
|
10,131
|
|
|
$
|
8,225
|
|
|
$
|
407
|
|
|
$
|
18,763
|
|
Loans and lease receivables:
|
|
|
|
|
|
|
|
|
||||||||
Collectively evaluated for impairment
|
|
$
|
1,003,855
|
|
|
$
|
447,459
|
|
|
$
|
25,003
|
|
|
$
|
1,476,317
|
|
Individually evaluated for impairment
|
|
13,506
|
|
|
12,324
|
|
|
358
|
|
|
26,188
|
|
||||
Loans acquired with deteriorated credit quality
|
|
527
|
|
|
6
|
|
|
—
|
|
|
533
|
|
||||
Total
|
|
$
|
1,017,888
|
|
|
$
|
459,789
|
|
|
$
|
25,361
|
|
|
$
|
1,503,038
|
|
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
|
|
(In Thousands)
|
||||||
Minimum lease payments receivable
|
|
$
|
26,700
|
|
|
$
|
24,898
|
|
Estimated unguaranteed residual values in leased property
|
|
9,330
|
|
|
8,312
|
|
||
Initial direct costs
|
|
73
|
|
|
76
|
|
||
Unearned lease and residual income
|
|
(2,933
|
)
|
|
(2,499
|
)
|
||
Investment in commercial direct financing leases
|
|
$
|
33,170
|
|
|
$
|
30,787
|
|
|
|
As of December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
|
|
(In Thousands)
|
||||||
Leasehold improvements
|
|
$
|
2,622
|
|
|
$
|
2,550
|
|
Furniture and equipment
|
|
7,021
|
|
|
6,442
|
|
||
|
|
9,643
|
|
|
8,992
|
|
||
Less: accumulated depreciation
|
|
(6,359
|
)
|
|
(5,836
|
)
|
||
Total premises and equipment, net
|
|
$
|
3,284
|
|
|
$
|
3,156
|
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
|
|
(In Thousands)
|
||||||
Accrued interest receivable
|
|
$
|
5,684
|
|
|
$
|
5,019
|
|
Net deferred tax asset
|
|
3,172
|
|
|
2,584
|
|
||
Investment in historic development entities
|
|
1,653
|
|
|
1,161
|
|
||
Investment in a community development entity
|
|
6,081
|
|
|
6,591
|
|
||
Investment in limited partnerships
|
|
4,176
|
|
|
4,261
|
|
||
Investment in Trust II
|
|
315
|
|
|
315
|
|
||
Fair value of interest rate swaps
|
|
4,637
|
|
|
942
|
|
||
Prepaid expenses
|
|
2,894
|
|
|
3,091
|
|
||
Other assets
|
|
6,039
|
|
|
5,884
|
|
||
Total accrued interest receivable and other assets
|
|
$
|
34,651
|
|
|
$
|
29,848
|
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||||||||||||
|
|
Balance
|
|
Average Balance
|
|
Average Rate
|
|
Balance
|
|
Average Balance
|
|
Average Rate
|
||||||||||
|
|
(Dollars in Thousands)
|
||||||||||||||||||||
Non-interest-bearing transaction accounts
|
|
$
|
280,769
|
|
|
$
|
241,529
|
|
|
—
|
%
|
|
$
|
277,445
|
|
|
$
|
230,907
|
|
|
—
|
%
|
Interest-bearing transaction accounts
|
|
229,612
|
|
|
269,943
|
|
|
0.99
|
|
|
217,625
|
|
|
226,540
|
|
|
0.59
|
|
||||
Money market accounts
|
|
516,045
|
|
|
491,756
|
|
|
1.09
|
|
|
515,077
|
|
|
583,241
|
|
|
0.47
|
|
||||
Certificates of deposit
|
|
153,022
|
|
|
94,172
|
|
|
1.70
|
|
|
76,199
|
|
|
56,667
|
|
|
1.00
|
|
||||
Wholesale deposits
|
|
275,851
|
|
|
302,440
|
|
|
1.95
|
|
|
307,985
|
|
|
361,712
|
|
|
1.70
|
|
||||
Total deposits
|
|
$
|
1,455,299
|
|
|
$
|
1,399,840
|
|
|
1.11
|
|
|
$
|
1,394,331
|
|
|
$
|
1,459,067
|
|
|
0.74
|
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||||||||||||
|
|
Balance
|
|
Weighted
Average
Balance
|
|
Weighted
Average
Rate
|
|
Balance
|
|
Weighted
Average
Balance
|
|
Weighted
Average
Rate
|
||||||||||
|
|
(Dollars in Thousands)
|
||||||||||||||||||||
Federal funds purchased
|
|
$
|
—
|
|
|
$
|
119
|
|
|
2.43
|
%
|
|
$
|
—
|
|
|
$
|
66
|
|
|
1.22
|
%
|
FHLB advances
|
|
274,500
|
|
|
274,382
|
|
|
2.06
|
|
|
183,500
|
|
|
105,276
|
|
|
1.40
|
|
||||
Line of credit
|
|
—
|
|
|
3
|
|
|
4.47
|
|
|
10
|
|
|
328
|
|
|
3.64
|
|
||||
Other borrowings
(1)
|
|
675
|
|
|
675
|
|
|
7.94
|
|
|
675
|
|
|
1,241
|
|
|
14.50
|
|
||||
Subordinated notes payable
|
|
23,769
|
|
|
23,739
|
|
|
6.64
|
|
|
23,713
|
|
|
23,161
|
|
|
6.93
|
|
||||
Junior subordinated notes
|
|
10,033
|
|
|
10,025
|
|
|
11.10
|
|
|
10,019
|
|
|
10,011
|
|
|
11.11
|
|
||||
|
|
$
|
308,977
|
|
|
$
|
308,943
|
|
|
2.72
|
|
|
$
|
217,917
|
|
|
$
|
140,083
|
|
|
3.14
|
|
Short-term borrowings
|
|
$
|
136,500
|
|
|
|
|
|
|
$
|
37,010
|
|
|
|
|
|
||||||
Long-term borrowings
|
|
172,477
|
|
|
|
|
|
|
180,907
|
|
|
|
|
|
||||||||
|
|
$
|
308,977
|
|
|
|
|
|
|
$
|
217,917
|
|
|
|
|
|
(1)
|
Weighted average rate of other borrowings reflects the cost of prepaying a secured borrowing during the second quarter of 2017.
|
|
|
Actual
|
|
Minimum Required for Capital Adequacy Purposes
|
|
For Capital Adequacy Purposes Plus Capital Conservation Buffer
|
|
Minimum Required to Be Well Capitalized Under Prompt Corrective Action
Requirements
|
||||||||||||||||||||
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
||||||||||||
|
|
(Dollars in Thousands)
|
||||||||||||||||||||||||||
As of December 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
First Business Bank
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total capital (to risk-weighted assets)
|
|
$
|
220,474
|
|
|
11.49
|
%
|
|
$
|
153,456
|
|
|
8.00
|
%
|
|
$
|
189,422
|
|
|
9.875
|
%
|
|
$
|
191,820
|
|
|
10.00
|
%
|
Tier 1 capital (to risk-weighted assets)
|
|
197,093
|
|
|
10.27
|
|
|
115,092
|
|
|
6.00
|
|
|
151,058
|
|
|
7.88
|
|
|
153,456
|
|
|
8.00
|
|
||||
Common equity tier 1 capital (to risk-weighted assets)
|
|
197,093
|
|
|
10.27
|
|
|
86,319
|
|
|
4.50
|
|
|
122,285
|
|
|
6.375
|
|
|
124,683
|
|
|
6.50
|
|
||||
Tier 1 leverage capital (to adjusted assets)
|
|
197,093
|
|
|
10.20
|
|
|
77,301
|
|
|
4.00
|
|
|
77,301
|
|
|
4.00
|
|
|
96,626
|
|
|
5.00
|
|
|
|
Actual
|
|
Minimum Required for Capital Adequacy Purposes
|
|
For Capital Adequacy Purposes Plus Capital Conservation Buffer
|
|
Minimum Required to Be Well Capitalized Under Prompt Corrective Action
Requirements
|
||||||||||||||||||||
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
||||||||||||
|
|
(Dollars in Thousands)
|
||||||||||||||||||||||||||
As of December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total capital
(to risk-weighted assets)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Consolidated
|
|
$
|
214,501
|
|
|
11.98
|
%
|
|
$
|
143,219
|
|
|
8.00
|
%
|
|
$
|
165,597
|
|
|
9.250
|
%
|
|
N/A
|
|
|
N/A
|
|
|
First Business Bank
|
|
207,986
|
|
|
11.66
|
|
|
142,736
|
|
|
8.00
|
|
|
165,038
|
|
|
9.250
|
|
|
$
|
178,420
|
|
|
10.00
|
%
|
|||
Tier 1 capital
(to risk-weighted assets)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Consolidated
|
|
$
|
169,176
|
|
|
9.45
|
%
|
|
$
|
107,414
|
|
|
6.00
|
%
|
|
$
|
129,792
|
|
|
7.250
|
%
|
|
N/A
|
|
|
N/A
|
|
|
First Business Bank
|
|
186,374
|
|
|
10.45
|
|
|
107,052
|
|
|
6.00
|
|
|
129,354
|
|
|
7.250
|
|
|
$
|
142,736
|
|
|
8.00
|
%
|
|||
Common equity tier 1 capital
(to risk-weighted assets)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Consolidated
|
|
$
|
159,157
|
|
|
8.89
|
%
|
|
$
|
80,561
|
|
|
4.50
|
%
|
|
$
|
102,939
|
|
|
5.750
|
%
|
|
N/A
|
|
|
N/A
|
|
|
First Business Bank
|
|
186,374
|
|
|
10.45
|
|
|
80,289
|
|
|
4.50
|
|
|
102,591
|
|
|
5.750
|
|
|
$
|
115,973
|
|
|
6.50
|
%
|
|||
Tier 1 leverage capital
(to adjusted assets)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Consolidated
|
|
$
|
169,176
|
|
|
9.54
|
%
|
|
$
|
70,920
|
|
|
4.00
|
%
|
|
$
|
70,920
|
|
|
4.00
|
%
|
|
N/A
|
|
|
N/A
|
|
|
First Business Bank
|
|
186,374
|
|
|
10.56
|
|
|
70,617
|
|
|
4.00
|
|
|
70,617
|
|
|
4.00
|
|
|
$
|
88,272
|
|
|
5.00
|
%
|
|
|
As of December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
|
|
(In Thousands)
|
||||||
Stockholders’ equity of the Corporation
|
|
$
|
180,707
|
|
|
$
|
169,278
|
|
Net unrealized and accumulated losses on specific items
|
|
1,684
|
|
|
1,238
|
|
||
Disallowed servicing assets
|
|
(751
|
)
|
|
(848
|
)
|
||
Disallowed goodwill and other intangibles
|
|
(10,498
|
)
|
|
(10,511
|
)
|
||
Junior subordinated notes
|
|
10,033
|
|
|
10,019
|
|
||
Tier 1 capital
|
|
181,175
|
|
|
169,176
|
|
||
Allowable general valuation allowances and subordinated debt
|
|
47,150
|
|
|
45,325
|
|
||
Total capital
|
|
$
|
228,325
|
|
|
$
|
214,501
|
|
|
|
For the Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
(Dollars in Thousands, Except Share Data)
|
|||||||||||
Basic earnings per common share
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
16,303
|
|
|
$
|
11,905
|
|
|
$
|
14,909
|
|
Less: earnings allocated to participating securities
|
|
240
|
|
|
162
|
|
|
219
|
|
|||
Basic earnings allocated to common shareholders
|
|
$
|
16,063
|
|
|
$
|
11,743
|
|
|
$
|
14,690
|
|
Weighted-average common shares outstanding, excluding participating securities
|
|
8,640,198
|
|
|
8,612,770
|
|
|
8,573,722
|
|
|||
Basic earnings per common share
|
|
$
|
1.86
|
|
|
$
|
1.36
|
|
|
$
|
1.71
|
|
|
|
|
|
|
|
|
||||||
Diluted earnings per common share
|
|
|
|
|
|
|
||||||
Earnings allocated to common shareholders, diluted
|
|
$
|
16,063
|
|
|
$
|
11,743
|
|
|
$
|
14,690
|
|
Weighted-average diluted common shares outstanding, excluding participating securities
|
|
8,640,198
|
|
|
8,612,770
|
|
|
8,573,722
|
|
|||
Diluted earnings per common share
|
|
$
|
1.86
|
|
|
$
|
1.36
|
|
|
$
|
1.71
|
|
|
|
For the Year Ended December 31,
|
|||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|||||||||||||||
|
|
Number of
Restricted
Shares
|
|
Weighted
Average
Grant-Date
Fair Value
|
|
Number of
Restricted
Shares
|
|
Weighted
Average
Grant-Date
Fair Value
|
|
Number of
Restricted
Shares
|
|
Weighted
Average
Grant-Date
Fair Value
|
|||||||||
Nonvested balance at beginning of year
|
|
130,441
|
|
|
$
|
21.43
|
|
|
116,245
|
|
|
$
|
21.13
|
|
|
135,471
|
|
|
$
|
20.13
|
|
Granted
|
|
66,498
|
|
|
20.57
|
|
|
71,130
|
|
|
21.67
|
|
|
60,415
|
|
|
22.74
|
|
|||
Vested
|
|
(46,034
|
)
|
|
21.01
|
|
|
(48,550
|
)
|
|
21.51
|
|
|
(56,090
|
)
|
|
18.71
|
|
|||
Forfeited
|
|
(19,284
|
)
|
|
22.25
|
|
|
(8,384
|
)
|
|
21.65
|
|
|
(23,551
|
)
|
|
20.90
|
|
|||
Nonvested balance as of end of year
|
|
131,621
|
|
|
21.02
|
|
|
130,441
|
|
|
21.43
|
|
|
116,245
|
|
|
21.13
|
|
|
|
For the Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(In Thousands)
|
||||||||||
Share-based compensation expense
|
|
$
|
1,004
|
|
|
$
|
1,078
|
|
|
$
|
994
|
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(In Thousands)
|
||||||||||
General and administrative expenses
|
|
$
|
1,877
|
|
|
$
|
1,905
|
|
|
$
|
1,545
|
|
Travel and other employee expenses
|
|
1,530
|
|
|
1,298
|
|
|
1,354
|
|
|||
Partnership income
(1)
|
|
—
|
|
|
—
|
|
|
(790
|
)
|
|||
Other expenses
|
|
23
|
|
|
12
|
|
|
129
|
|
|||
Total other non-interest expense
|
|
$
|
3,430
|
|
|
$
|
3,215
|
|
|
$
|
2,238
|
|
(1)
|
Partnership income was recorded in other non-interest income for the years ended December 31, 2018 and 2017.
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(In Thousands)
|
||||||||||
Current:
|
|
|
|
|
|
|
||||||
Federal
|
|
$
|
729
|
|
|
$
|
131
|
|
|
$
|
2,839
|
|
State
|
|
1,054
|
|
|
448
|
|
|
425
|
|
|||
Current tax expense
|
|
1,783
|
|
|
579
|
|
|
3,264
|
|
|||
Deferred:
|
|
|
|
|
|
|
||||||
Federal
|
|
(367
|
)
|
|
1,657
|
|
|
(1,000
|
)
|
|||
State
|
|
(65
|
)
|
|
90
|
|
|
(108
|
)
|
|||
Deferred tax (benefit) expense
|
|
(432
|
)
|
|
1,747
|
|
|
(1,108
|
)
|
|||
Total income tax expense
|
|
$
|
1,351
|
|
|
$
|
2,326
|
|
|
$
|
2,156
|
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
|
|
(In Thousands)
|
||||||
Deferred tax assets:
|
|
|
|
|
||||
Allowance for loan and lease losses
|
|
$
|
5,424
|
|
|
$
|
4,795
|
|
SBA recourse reserve
|
|
785
|
|
|
729
|
|
||
Deferred compensation
|
|
1,045
|
|
|
482
|
|
||
State net operating loss carryforwards
|
|
571
|
|
|
615
|
|
||
Tax credit carryforwards
|
|
1,373
|
|
|
—
|
|
||
Non-accrual loan interest
|
|
1,472
|
|
|
942
|
|
||
Capital loss carryforwards
|
|
22
|
|
|
21
|
|
||
Unrealized losses on securities
|
|
579
|
|
|
423
|
|
||
Other
|
|
68
|
|
|
450
|
|
||
Total deferred tax assets before valuation allowance
|
|
11,339
|
|
|
8,457
|
|
||
Valuation allowance
|
|
—
|
|
|
—
|
|
||
Total deferred tax assets
|
|
11,339
|
|
|
8,457
|
|
||
Deferred tax liabilities:
|
|
|
|
|
||||
Leasing and fixed asset activities
|
|
6,965
|
|
|
5,338
|
|
||
Loan servicing asset
|
|
358
|
|
|
471
|
|
||
Other
|
|
844
|
|
|
64
|
|
||
Total deferred tax liabilities
|
|
8,167
|
|
|
5,873
|
|
||
Net deferred tax asset
|
|
$
|
3,172
|
|
|
$
|
2,584
|
|
|
|
December 31, 2018
|
|
December 31, 2017
|
|
December 31, 2016
|
||||||
|
|
(In Thousands)
|
||||||||||
Change in net deferred tax assets
|
|
$
|
588
|
|
|
$
|
(1,468
|
)
|
|
$
|
1,419
|
|
Deferred taxes allocated to other comprehensive income
|
|
(156
|
)
|
|
(279
|
)
|
|
(311
|
)
|
|||
Deferred income tax benefit (expense)
|
|
$
|
432
|
|
|
$
|
(1,747
|
)
|
|
$
|
1,108
|
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(Dollars in Thousands)
|
||||||||||
Income before income tax expense
|
|
$
|
17,654
|
|
|
$
|
14,231
|
|
|
$
|
17,065
|
|
Tax expense at statutory federal rate of 21%, 35% and 35% applied to income before income tax expense, respectively
|
|
$
|
3,707
|
|
|
$
|
4,981
|
|
|
$
|
5,973
|
|
State income tax, net of federal effect
|
|
803
|
|
|
511
|
|
|
206
|
|
|||
Tax-exempt security and loan income, net of TEFRA adjustments
|
|
(847
|
)
|
|
(1,045
|
)
|
|
(1,114
|
)
|
|||
Bank-owned life insurance
|
|
(250
|
)
|
|
(438
|
)
|
|
(341
|
)
|
|||
Tax credits, net
|
|
(2,157
|
)
|
|
(2,390
|
)
|
|
(2,696
|
)
|
|||
Deferred tax revaluation adjustment
|
|
—
|
|
|
629
|
|
|
—
|
|
|||
Other
|
|
95
|
|
|
78
|
|
|
128
|
|
|||
Total income tax expense
|
|
$
|
1,351
|
|
|
$
|
2,326
|
|
|
$
|
2,156
|
|
Effective tax rate
|
|
7.65
|
%
|
|
16.34
|
%
|
|
12.63
|
%
|
|
|
Interest Rate Swap Contracts
|
||||||||||
|
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||
|
|
Balance Sheet Location
|
|
Fair Value
|
|
Balance Sheet Location
|
|
Fair Value
|
||||
|
|
(In Thousands)
|
||||||||||
Derivatives not designated as hedging instruments
|
|
|
|
|
|
|
|
|
||||
December 31, 2018
|
|
Accrued interest receivable and other assets
|
|
$
|
4,637
|
|
|
Accrued interest payable and other liabilities
|
|
$
|
4,637
|
|
December 31, 2017
|
|
Accrued interest receivable and other assets
|
|
$
|
942
|
|
|
Accrued interest payable and other liabilities
|
|
$
|
942
|
|
Derivatives designated as hedging instruments
|
|
|
|
|
|
|
|
|
||||
December 31, 2018
|
|
Accumulated other comprehensive income
(1)
|
|
$
|
142
|
|
|
Accrued interest payable and other liabilities
|
|
$
|
142
|
|
December 31, 2017
|
|
Accumulated other comprehensive income
(1)
|
|
$
|
122
|
|
|
Accrued interest payable and other liabilities
|
|
$
|
122
|
|
(1)
|
The fair value of derivatives designated as hedging instruments included in accumulated other comprehensive income represent pre-tax amounts, which are reported net of tax on the unaudited Consolidated Balance Sheets.
|
|
|
At December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
|
|
(In Thousands)
|
||||||
Commitments to extend credit, primarily commercial loans
|
|
$
|
553,801
|
|
|
$
|
497,993
|
|
Standby letters of credit
|
|
12,436
|
|
|
13,845
|
|
|
|
As of and For the Year Ended December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
|
|
(In Thousands)
|
||||||
Balance at the beginning of the period
|
|
$
|
2,849
|
|
|
$
|
1,750
|
|
SBA recourse provision
|
|
1,913
|
|
|
2,240
|
|
||
Charge-offs, net
|
|
(1,806
|
)
|
|
(1,141
|
)
|
||
Balance at the end of the period
|
|
$
|
2,956
|
|
|
$
|
2,849
|
|
|
|
December 31, 2018
|
||||||||||||||
|
|
Fair Value Measurements Using
|
|
|
||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
|
(In Thousands)
|
||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Securities available-for-sale:
|
|
|
|
|
|
|
|
|
||||||||
U.S. government agency securities - government-sponsored enterprises
|
|
$
|
—
|
|
|
$
|
990
|
|
|
$
|
—
|
|
|
$
|
990
|
|
Municipal securities
|
|
—
|
|
|
5,886
|
|
|
—
|
|
|
5,886
|
|
||||
Mortgage backed securities - government issued
|
|
—
|
|
|
19,628
|
|
|
—
|
|
|
19,628
|
|
||||
Mortgage backed securities - government-sponsored enterprises
|
|
—
|
|
|
109,478
|
|
|
—
|
|
|
109,478
|
|
||||
Other securities
|
|
—
|
|
|
2,376
|
|
|
—
|
|
|
2,376
|
|
||||
Interest rate swaps
|
|
—
|
|
|
4,637
|
|
|
—
|
|
|
4,637
|
|
||||
Liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
|
—
|
|
|
4,779
|
|
|
—
|
|
|
4,779
|
|
|
|
December 31, 2017
|
||||||||||||||
|
|
Fair Value Measurements Using
|
|
|
||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
|
(In Thousands)
|
||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Securities available-for-sale:
|
|
|
|
|
|
|
|
|
||||||||
U.S. government agency securities - government-sponsored enterprises
|
|
$
|
—
|
|
|
$
|
1,000
|
|
|
$
|
—
|
|
|
$
|
1,000
|
|
Municipal securities
|
|
—
|
|
|
9,414
|
|
|
—
|
|
|
9,414
|
|
||||
Mortgage backed securities - government issued
|
|
—
|
|
|
22,249
|
|
|
—
|
|
|
22,249
|
|
||||
Mortgage backed securities - government-sponsored enterprises
|
|
—
|
|
|
90,305
|
|
|
—
|
|
|
90,305
|
|
||||
Other securities
|
|
—
|
|
|
3,037
|
|
|
—
|
|
|
3,037
|
|
||||
Interest rate swaps
|
|
—
|
|
|
942
|
|
|
—
|
|
|
942
|
|
||||
Liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
|
—
|
|
|
1,064
|
|
|
—
|
|
|
1,064
|
|
|
|
December 31, 2018
|
||||||||||||||
|
|
Fair Value Measurements Using
|
|
|
||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
|
(In Thousands)
|
||||||||||||||
Impaired loans
|
|
$
|
—
|
|
|
$
|
13,935
|
|
|
$
|
1,771
|
|
|
$
|
15,706
|
|
Foreclosed properties
|
|
—
|
|
|
2,547
|
|
|
—
|
|
|
2,547
|
|
||||
Loan servicing rights
|
|
—
|
|
|
—
|
|
|
1,278
|
|
|
1,278
|
|
|
|
December 31, 2017
|
||||||||||||||
|
|
Fair Value Measurements Using
|
|
|
||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
|
(In Thousands)
|
||||||||||||||
Impaired loans
|
|
$
|
—
|
|
|
$
|
10,063
|
|
|
$
|
5,084
|
|
|
$
|
15,147
|
|
Foreclosed properties
|
|
—
|
|
|
1,069
|
|
|
—
|
|
|
1,069
|
|
|
|
December 31, 2018
|
||||||||||||||||||
|
|
Carrying
Amount |
|
Fair Value
|
||||||||||||||||
|
|
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||
|
|
(In Thousands)
|
||||||||||||||||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
86,546
|
|
|
$
|
86,546
|
|
|
$
|
67,246
|
|
|
$
|
19,300
|
|
|
$
|
—
|
|
Securities available-for-sale
|
|
138,358
|
|
|
138,358
|
|
|
—
|
|
|
138,358
|
|
|
—
|
|
|||||
Securities held-to-maturity
|
|
37,731
|
|
|
37,409
|
|
|
—
|
|
|
37,409
|
|
|
—
|
|
|||||
Loans held for sale
|
|
5,287
|
|
|
5,816
|
|
|
—
|
|
|
5,816
|
|
|
—
|
|
|||||
Loans and lease receivables, net
|
|
1,597,230
|
|
|
1,589,323
|
|
|
—
|
|
|
13,935
|
|
|
1,575,388
|
|
|||||
Federal Home Loan Bank stock
|
|
7,240
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|||||
Accrued interest receivable
|
|
5,684
|
|
|
5,684
|
|
|
5,684
|
|
|
—
|
|
|
—
|
|
|||||
Interest rate swaps
|
|
4,637
|
|
|
4,637
|
|
|
—
|
|
|
4,637
|
|
|
—
|
|
|||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Deposits
|
|
1,455,299
|
|
|
1,453,482
|
|
|
1,026,648
|
|
|
426,834
|
|
|
—
|
|
|||||
Federal Home Loan Bank advances and other borrowings
|
|
298,944
|
|
|
294,127
|
|
|
—
|
|
|
294,127
|
|
|
—
|
|
|||||
Junior subordinated notes
|
|
10,033
|
|
|
9,955
|
|
|
—
|
|
|
—
|
|
|
9,955
|
|
|||||
Accrued interest payable
|
|
3,696
|
|
|
3,696
|
|
|
3,696
|
|
|
—
|
|
|
—
|
|
|||||
Interest rate swaps
|
|
4,779
|
|
|
4,779
|
|
|
—
|
|
|
4,779
|
|
|
—
|
|
|||||
Off-balance-sheet items:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Standby letters of credit
|
|
59
|
|
|
59
|
|
|
—
|
|
|
—
|
|
|
59
|
|
|
|
December 31, 2017
|
||||||||||||||||||
|
|
Carrying
Amount |
|
Fair Value
|
||||||||||||||||
|
|
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||
|
|
(In Thousands)
|
||||||||||||||||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
52,539
|
|
|
$
|
52,539
|
|
|
$
|
35,114
|
|
|
$
|
17,425
|
|
|
$
|
—
|
|
Securities available-for-sale
|
|
126,005
|
|
|
126,005
|
|
|
—
|
|
|
126,005
|
|
|
—
|
|
|||||
Securities held-to-maturity
|
|
37,778
|
|
|
37,696
|
|
|
—
|
|
|
37,696
|
|
|
—
|
|
|||||
Loans held for sale
|
|
2,194
|
|
|
2,413
|
|
|
—
|
|
|
2,413
|
|
|
—
|
|
|||||
Loans and lease receivables, net
|
|
1,482,832
|
|
|
1,482,664
|
|
|
—
|
|
|
10,063
|
|
|
1,472,601
|
|
|||||
Federal Home Loan Bank stock
|
|
5,670
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|||||
Accrued interest receivable
|
|
5,019
|
|
|
5,019
|
|
|
5,019
|
|
|
—
|
|
|
—
|
|
|||||
Interest rate swaps
|
|
942
|
|
|
942
|
|
|
—
|
|
|
942
|
|
|
—
|
|
|||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Deposits
|
|
1,394,331
|
|
|
1,391,801
|
|
|
1,010,147
|
|
|
381,654
|
|
|
—
|
|
|||||
Federal Home Loan Bank advances and other borrowings
|
|
207,898
|
|
|
191,441
|
|
|
—
|
|
|
191,441
|
|
|
—
|
|
|||||
Junior subordinated notes
|
|
10,019
|
|
|
8,836
|
|
|
—
|
|
|
—
|
|
|
8,836
|
|
|||||
Accrued interest payable
|
|
2,095
|
|
|
2,095
|
|
|
2,095
|
|
|
—
|
|
|
—
|
|
|||||
Interest rate swaps
|
|
1,064
|
|
|
1,064
|
|
|
—
|
|
|
1,064
|
|
|
—
|
|
|||||
Off-balance-sheet items:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Standby letters of credit
|
|
75
|
|
|
75
|
|
|
—
|
|
|
—
|
|
|
75
|
|
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
|
|
(In Thousands)
|
||||||
Assets
|
|
|
|
|
||||
Cash and due from banks
|
|
$
|
3,699
|
|
|
$
|
1,472
|
|
Investments in subsidiaries, at equity
|
|
206,973
|
|
|
196,810
|
|
||
Leasehold improvements and equipment, net
|
|
2,036
|
|
|
2,067
|
|
||
Other assets
|
|
5,444
|
|
|
5,993
|
|
||
Total assets
|
|
$
|
218,152
|
|
|
$
|
206,342
|
|
Liabilities and Stockholders’ Equity
|
|
|
|
|
||||
Borrowed funds
|
|
$
|
33,802
|
|
|
$
|
33,742
|
|
Other liabilities
|
|
3,643
|
|
|
3,322
|
|
||
Total liabilities
|
|
37,445
|
|
|
37,064
|
|
||
Stockholders’ equity
|
|
180,707
|
|
|
169,278
|
|
||
Total liabilities and stockholders’ equity
|
|
$
|
218,152
|
|
|
$
|
206,342
|
|
|
|
For the Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(In Thousands)
|
||||||||||
Interest expense
|
|
$
|
2,703
|
|
|
$
|
2,744
|
|
|
$
|
2,799
|
|
Non-interest income
|
|
|
|
|
|
|
||||||
Consulting and rental income from consolidated subsidiaries
|
|
20,267
|
|
|
19,139
|
|
|
16,036
|
|
|||
Other non-interest income
|
|
33
|
|
|
34
|
|
|
33
|
|
|||
Total non-interest income
|
|
20,300
|
|
|
19,173
|
|
|
16,069
|
|
|||
Non-interest expense
|
|
22,866
|
|
|
21,575
|
|
|
19,250
|
|
|||
Loss before income tax benefit and equity in undistributed net income of consolidated subsidiaries
|
|
5,269
|
|
|
5,146
|
|
|
5,980
|
|
|||
Income tax benefit
|
|
1,478
|
|
|
1,965
|
|
|
2,170
|
|
|||
Loss before equity in undistributed net income of consolidated subsidiaries
|
|
3,791
|
|
|
3,181
|
|
|
3,810
|
|
|||
Equity in undistributed net income of consolidated subsidiaries
|
|
20,094
|
|
|
15,086
|
|
|
18,719
|
|
|||
Net income
|
|
$
|
16,303
|
|
|
$
|
11,905
|
|
|
$
|
14,909
|
|
|
|
For the Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(In Thousands)
|
||||||||||
Operating activities
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
16,303
|
|
|
$
|
11,905
|
|
|
$
|
14,909
|
|
Adjustments to reconcile net income to net cash used in operating activities:
|
|
|
|
|
|
|
||||||
Equity in undistributed earnings of consolidated subsidiaries
|
|
(20,094
|
)
|
|
(15,086
|
)
|
|
(18,719
|
)
|
|||
Share-based compensation
|
|
1,004
|
|
|
1,078
|
|
|
994
|
|
|||
Excess tax benefit from share-based compensation
|
|
(24
|
)
|
|
(37
|
)
|
|
(83
|
)
|
|||
Net increase (decrease) in other liabilities
|
|
321
|
|
|
(4,170
|
)
|
|
1,198
|
|
|||
Other, net
|
|
72
|
|
|
(2,233
|
)
|
|
(3,162
|
)
|
|||
Net cash used in operating activities
|
|
(2,418
|
)
|
|
(8,543
|
)
|
|
(4,863
|
)
|
|||
Investing activities
|
|
|
|
|
|
|
||||||
Dividends received from subsidiaries
|
|
10,034
|
|
|
14,534
|
|
|
13,534
|
|
|||
Capital contributions to subsidiaries
|
|
—
|
|
|
—
|
|
|
(3,500
|
)
|
|||
Net cash provided by investing activities
|
|
10,034
|
|
|
14,534
|
|
|
10,034
|
|
|||
Financing activities
|
|
|
|
|
|
|
||||||
Net increase (decrease) in short-term borrowed funds
|
|
60
|
|
|
(1,000
|
)
|
|
(1,500
|
)
|
|||
Proceeds from issuance of subordinated notes payable
|
|
—
|
|
|
9,090
|
|
|
—
|
|
|||
Repayment of subordinated notes payable
|
|
—
|
|
|
(7,875
|
)
|
|
—
|
|
|||
Purchase of treasury stock
|
|
(533
|
)
|
|
(323
|
)
|
|
(467
|
)
|
|||
Cash dividends paid
|
|
(4,916
|
)
|
|
(4,538
|
)
|
|
(4,176
|
)
|
|||
Net cash used in financing activities
|
|
(5,389
|
)
|
|
(4,646
|
)
|
|
(6,143
|
)
|
|||
Net increase (decrease) in cash and due from banks
|
|
2,227
|
|
|
1,345
|
|
|
(972
|
)
|
|||
Cash and due from banks at the beginning of the period
|
|
1,472
|
|
|
127
|
|
|
1,099
|
|
|||
Cash and due from banks at the end of the period
|
|
$
|
3,699
|
|
|
$
|
1,472
|
|
|
$
|
127
|
|
|
2018
|
|
2017
|
||||||||||||||||||||||||||||
|
Fourth
Quarter |
|
Third
Quarter
|
|
Second
Quarter
|
|
First
Quarter
|
|
Fourth
Quarter
|
|
Third
Quarter
|
|
Second
Quarter
|
|
First
Quarter
|
||||||||||||||||
|
(Dollars in Thousands, Except Per Share Data)
|
||||||||||||||||||||||||||||||
Interest income
|
$
|
24,522
|
|
|
$
|
23,563
|
|
|
$
|
22,468
|
|
|
$
|
20,722
|
|
|
$
|
19,504
|
|
|
$
|
18,634
|
|
|
$
|
19,225
|
|
|
$
|
18,447
|
|
Interest expense
|
7,407
|
|
|
6,469
|
|
|
5,537
|
|
|
4,520
|
|
|
4,146
|
|
|
3,751
|
|
|
3,746
|
|
|
3,559
|
|
||||||||
Net interest income
|
17,115
|
|
|
17,094
|
|
|
16,931
|
|
|
16,202
|
|
|
15,358
|
|
|
14,883
|
|
|
15,479
|
|
|
14,888
|
|
||||||||
Provision for loan and lease losses
|
983
|
|
|
(546
|
)
|
|
2,579
|
|
|
2,476
|
|
|
473
|
|
|
1,471
|
|
|
3,656
|
|
|
572
|
|
||||||||
Non-interest income
|
4,648
|
|
|
4,871
|
|
|
3,982
|
|
|
4,667
|
|
|
3,525
|
|
|
4,339
|
|
|
4,738
|
|
|
4,063
|
|
||||||||
Non-interest expense
|
18,244
|
|
|
15,746
|
|
|
14,467
|
|
|
13,907
|
|
|
14,859
|
|
|
14,231
|
|
|
14,221
|
|
|
13,560
|
|
||||||||
Income before income tax expense
|
2,536
|
|
|
6,765
|
|
|
3,867
|
|
|
4,486
|
|
|
3,551
|
|
|
3,520
|
|
|
2,340
|
|
|
4,819
|
|
||||||||
Income tax (benefit) expense
|
(1,528
|
)
|
|
1,464
|
|
|
578
|
|
|
837
|
|
|
(486
|
)
|
|
936
|
|
|
454
|
|
|
1,422
|
|
||||||||
Net income
|
$
|
4,064
|
|
|
$
|
5,301
|
|
|
$
|
3,289
|
|
|
$
|
3,649
|
|
|
$
|
4,037
|
|
|
$
|
2,584
|
|
|
$
|
1,886
|
|
|
$
|
3,397
|
|
Per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Basic earnings
|
$
|
0.46
|
|
|
$
|
0.60
|
|
|
$
|
0.38
|
|
|
$
|
0.42
|
|
|
$
|
0.46
|
|
|
$
|
0.30
|
|
|
$
|
0.22
|
|
|
$
|
0.39
|
|
Diluted earnings
|
0.46
|
|
|
0.60
|
|
|
0.38
|
|
|
0.42
|
|
|
0.46
|
|
|
0.30
|
|
|
0.22
|
|
|
0.39
|
|
||||||||
Dividends declared
|
0.14
|
|
|
0.14
|
|
|
0.14
|
|
|
0.14
|
|
|
0.13
|
|
|
0.13
|
|
|
0.13
|
|
|
0.13
|
|
(a)
|
Directors of the Registrant
. The information included in the definitive Proxy Statement for the Annual Meeting of the Shareholders to be held on
May 2, 2019
under the captions “Item 1 - Election of Directors,” “Corporate Governance Principles and Practices” and “Section 16(a) Beneficial Ownership Reporting Compliance” is incorporated herein by reference.
|
(b)
|
Executive Officers of the Registrant
. The information presented in Item 1 of this document is incorporated herein by reference.
|
(c)
|
Code of Ethics
. The Corporation has adopted a code of ethics applicable to all employees, including the principal executive officer, principal financial officer and principal accounting officer of the Corporation. The FBFS Code of Ethics is posted on the Corporation’s website at www.firstbusiness.com. The Corporation intends to satisfy the disclosure requirements under Item 5.05(c) of Form 8-K regarding any amendment to or waiver of the code with respect to its Chief Executive Officer, Chief Financial Officer, principal accounting officer, and persons performing similar functions, by posting such information to the Corporation’s website.
|
Plan category
|
|
Number of securities to
be issued upon exercise
of outstanding options,
warrants and rights
|
|
Weighted-average
exercise price of
outstanding options,
warrants and rights
|
|
Number of securities
remaining available for
future issuance under
equity compensation
plans (excluding
securities reflected in
column (a))
|
||||
|
|
(a)
|
|
(b)
|
|
(c)
|
||||
Equity compensation plans approved by security holders
|
|
—
|
|
|
$
|
—
|
|
|
164,621
|
|
Equity compensation plans not approved by security holders
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
FIRST BUSINESS FINANCIAL SERVICES, INC.
|
|
|
|
|
February 28, 2019
|
|
|
/s/ Corey A. Chambas
|
|
|
|
Corey A. Chambas
|
|
|
|
Chief Executive Officer
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/ Corey A. Chambas
|
|
Chief Executive Officer
|
|
February 28, 2019
|
Corey A. Chambas
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(principal executive officer)
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/s/ Edward G. Sloane, Jr.
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Chief Financial Officer
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February 28, 2019
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Edward G. Sloane, Jr.
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(principal financial officer)
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/s/ Peggy J. Stebbins
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Chief Accounting Officer & Controller
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February 28, 2019
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Peggy J. Stebbins
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(principal accounting officer)
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/s/ Gerald L. Kilcoyne
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Chair of the Board of Directors
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February 28, 2019
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Gerald L. Kilcoyne
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/s/ Laurie S. Benson
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Director
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February 28, 2019
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Laurie S. Benson
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/s/ Mark D. Bugher
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Director
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February 28, 2019
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Mark D. Bugher
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/s/ Carla C. Chavarria
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Director
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February 28, 2019
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Carla C. Chavarria
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/s/ Jan A. Eddy
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Director
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February 28, 2019
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Jan A. Eddy
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/s/ John J. Harris
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Director
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February 28, 2019
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John J. Harris
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/s/ Ralph R. Kauten
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Director
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February 28, 2019
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Ralph R. Kauten
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/s/ Timothy J. Keane
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Director
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February 28, 2019
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Timothy J. Keane
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/s/ W. Kent Lorenz
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Director
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February 28, 2019
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W. Kent Lorenz
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/s/ Daniel P. Olszewski
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Director
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February 28, 2019
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Daniel P. Olszewski
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/s/ Carol P. Sanders
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Director
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February 28, 2019
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Carol P. Sanders
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Subsidiary
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State of Incorporation or Organization
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First Business Bank
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Wisconsin
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First Business Capital Corp.
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Wisconsin
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First Business Equipment Finance, LLC
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Wisconsin
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Rimrock Road Investment Fund, LLC
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Wisconsin
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BOC Investment, LLC
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Wisconsin
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Mitchell Street Apartments Investment, LLC
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Wisconsin
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ABKC Real Estate, LLC
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Kansas
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FBB Real Estate 2, LLC
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Kansas
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FBB Tax Credit Investment, LLC
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Wisconsin
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First Madison Investment Corp.
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Nevada
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FBFS Statutory Trust II
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Delaware
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1.
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I have reviewed this Annual Report on Form 10-K of First Business Financial Services, Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a.
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b.
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
Any significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b.
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ Corey A. Chambas
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|
Corey A. Chambas
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Chief Executive Officer
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|
February 28, 2019
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1.
|
I have reviewed this Annual Report on Form 10-K of First Business Financial Services, Inc.;
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2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
|
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;
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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 accounting 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
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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
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
Any 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.
|
|
/s/ Edward G. Sloane, Jr.
|
|
Edward G. Sloane, Jr.
|
|
Chief Financial Officer
|
|
February 28, 2019
|
|
/s/ Corey A. Chambas
|
|
Corey A. Chambas
|
|
Chief Executive Officer
|
|
February 28, 2019
|
|
|
|
/s/ Edward G. Sloane, Jr.
|
|
Edward G. Sloane, Jr.
|
|
Chief Financial Officer
|
|
February 28, 2019
|