FORM 10-K
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ý
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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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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Allegiance Bancshares, Inc.
(Exact name of registrant as specified in its charter)
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Texas
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26-3564100
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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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Common Stock, par value $1.00 per share
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NASDAQ Global Market
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(Title of each class)
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(Name of each exchange on which is registered)
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Large Accelerated Filer
o
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Accelerated Filer
x
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Non-accelerated Filer
o
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Smaller Reporting Company
o
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Emerging growth company
x
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•
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increasing the productivity of existing bankers, as measured by loans, deposits and fee income per banker, while enhancing profitability by leveraging our existing operating platform;
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•
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focusing on local and individualized decision-making, allowing us to provide customers with rapid decisions on loan requests, which we believe allows us to effectively compete with larger financial institutions;
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•
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identifying and hiring additional seasoned bankers in the Houston metropolitan area who will thrive within our super-community banking model, and opening additional branches where we are able to attract seasoned bankers; and
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•
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developing new products designed to serve the increasingly diversified Houston economy, while preserving our strong culture of risk management.
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Institution acquired
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Date Completed
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Acquired
Assets
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Acquired
Loans
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Acquired
Deposits
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Number of
Branches
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||||||
(Dollars in millions)
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||||||||||||||||
Independence Bank, N.A.
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November 16, 2013
|
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$
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222.1
|
|
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$
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132.4
|
|
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$
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199.4
|
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3
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F&M Bancshares, Inc.
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January 1, 2015
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$
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569.7
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|
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$
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410.2
|
|
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$
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488.9
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9*
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•
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Experienced, growth-focused senior management team.
Our senior management team has a demonstrated track record of managing profitable organic growth, improving operating efficiencies, maintaining a strong risk management culture, implementing a community and service-focused approach to banking and successfully executing and integrating acquisitions. The Company’s Board of Directors has many years of combined experience in serving as directors and/or officers of financial institutions. The directors have a wide array of business experience and, since many are residents of our primary market area, participate in and support local community activities, which is a significant asset to our business development efforts and enables us to be responsive to the needs of our customers.
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•
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Scalable banking and operational platform designed to foster and accommodate significant growth.
We have built a capable and knowledgeable staff by utilizing the significant prior experience of our management team and employees. We have made extensive investments in the technology and systems necessary to build a scalable corporate infrastructure with the capacity to support continued growth. We believe that our strong capital and asset quality position will allow us to grow and that our scalable operating platform will effectively support expected growth, resulting in greater efficiency and enhanced profitability.
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•
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Community-focused, full service customer relationships.
We believe that our super-community banking strategy facilitates strong relationships with our customers. We are focused on delivering a wide variety of high-quality, relationship-driven commercial and community-oriented banking products and services tailored to meet the needs of small to medium-sized businesses, professionals and individuals in the Houston metropolitan area. We actively solicit the deposit business of our consumer and commercial loan customers and seek to further leverage these relationships by broadening customer relationships with additional products and services.
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•
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Local decision making authority and exclusive Houston focus.
Recent acquisitions of local financial institutions in the Houston metropolitan area by larger, more regionally focused competitors have led to a reduced number of locally-based competitors, and we believe this has created an underserved base of small to medium-sized businesses, professionals and individuals that are interested in banking with a company headquartered in, and with decision-making authority based in, the Houston metropolitan area. We seek to develop comprehensive, long-term banking relationships with customers and offer an array of products and services to support our loan and deposit activities while delivering high quality customer service. Our products and services are tailored to address the needs of our targeted customers. We are exclusively focused on serving the greater Houston market, which we believe positions us well to compete effectively and build strong customer relationships.
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•
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Focus on seasoned lenders
. We believe our management team’s long-standing presence and experience in the Houston metropolitan area gives us valuable insight into the local market and the ability to successfully recruit talented lenders. Our team of seasoned lenders has been the driver of our organic growth. The Company’s officer compensation structure, which includes equity grants, profit sharing and various incentive programs, attracts talented lenders and motivates them to increase the size of their loan and deposit portfolios and generate fee income while maintaining strong credit quality.
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•
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Disciplined underwriting and credit administration.
Our management, bankers, lending officers and credit administration team emphasize a strong culture of risk management that is supported by comprehensive policies and procedures for credit underwriting, funding and administration that enable us to maintain sound asset quality. The Company’s underwriting methodology emphasizes analysis of global cash flow coverage, loan to collateral value and obtaining personal guaranties in all but a few well-secured cases. Our tiered underwriting structure includes progressive levels of individual loan authority, concurrence authority and senior loan committee approval. We intend to continue to emphasize and adhere to these procedures and controls, which we believe have helped to minimize our level of loan charge-offs.
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•
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Diversified loan portfolio.
The Company’s focus on loans to small to medium-sized businesses results in a more diffused and diversified portfolio of relatively smaller loan relationships, thus reducing the risks that result from a dependence on fewer but larger lending relationships. As of
December 31, 2017
, our average funded core loan size was approximately $305 thousand. We do not lend directly to oil and gas exploration and production companies. As of
December 31, 2017
, 3.1% of our total loan portfolio is to customers in the oilfield services or oil-related industries for whom the price of oil and gas has a significant operational or financial impact. Although we operate in the Houston metropolitan area, we believe that our lack of both direct lending to oil and gas exploration and production companies and reserve-based lending will reduce the impact to our business in the event of a prolonged period of lower oil and gas prices.
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•
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require affirmative actions to correct any violation or practice;
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•
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issue administrative orders that can be judicially enforced;
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•
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direct increases in capital;
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•
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direct the sale of subsidiaries or other assets;
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•
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limit dividends and distributions;
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•
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restrict growth;
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•
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assess civil monetary penalties;
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•
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remove officers and directors; and
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•
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terminate deposit insurance.
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•
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discovering proper candidates for acquisition;
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•
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incurring time and expense associated with identifying and evaluating potential acquisitions and negotiating potential transactions, resulting in management’s attention being diverted from the operation of our existing business;
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•
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using inaccurate estimates and judgments to evaluate credit, operations, management, compliance and market risks with respect to the target institution or assets;
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•
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conducting adequate due diligence and managing known and unknown risks and uncertainties;
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•
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obtaining necessary regulatory approvals;
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•
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integrating the operations and personnel of the combined businesses, thereby creating an adverse short-term effect on results of operations;
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•
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attracting and retaining qualified management and key personnel, including lenders;
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•
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maintaining asset quality;
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•
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attracting and retaining customers;
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•
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attracting funding to support additional growth within acceptable risk tolerances; and
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•
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maintaining adequate regulatory capital.
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•
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loan delinquencies may rise:
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•
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nonperforming assets and foreclosures may increase;
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•
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demand for our products and services may decline; and
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•
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collateral securing our loans, especially real estate, may decline in value, which could reduce customers’ borrowing power and repayment ability.
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•
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the viability of the contractor:
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•
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the value of the project being subject to successful completion;
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•
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the contractor’s ability to complete the project, to meet deadlines and time schedules and to stay within our estimates; and
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•
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concentration of such loans with a single contractor and our affiliates.
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•
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the ability to develop, maintain and build long-term customer relationships based on top quality service, high ethical standards and safe, sound assets;
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•
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the scope, relevance and pricing of products and services offered to meet customer needs and demands;
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•
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the rate at which the Company introduces new products and services relative to our competitors;
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•
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customer satisfaction with our level of service;
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•
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the ability to expand our market position; and
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•
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industry and general economic trends.
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•
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general economic conditions and overall market fluctuations;
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•
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actual or anticipated fluctuations in our quarterly or annual financial results;
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•
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operating and stock price performance of other companies that investors deem comparable to ours;
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•
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the perception that investment in Texas is unattractive or less attractive during periods of low oil prices;
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•
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announcements by the Company or our competitors of significant acquisitions, dispositions, innovations or new programs and services;
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•
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the public reaction to our press releases, other public announcements and filings with the SEC;
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•
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changes in financial estimates and recommendations by securities analysts following Allegiance's stock, or the failure of securities analysts to cover Allegiance's common stock;
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•
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changes in earnings estimates by securities analysts or our ability to meet those estimates;
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the trading volume of Allegiance's common stock;
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•
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changes in governmental monetary policies, including the policies of the Federal Reserve;
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changes in business, legal or regulatory conditions, or other developments affecting participants in our industry, and publicity regarding our business or any of our significant customers or competitors;
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•
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changes in accounting standards, policies, guidance, interpretations or principles; and
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•
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future sales of Allegiance's common stock by the Company, directors, executives and significant shareholders.
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•
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prepare and distribute periodic reports, proxy statements and other shareholder communications in compliance with the federal securities laws and rules;
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•
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expand the roles and duties of Allegiance's Board of Directors and committees thereof;
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•
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maintain an internal audit function;
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•
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institute more comprehensive financial reporting and disclosure compliance procedures;
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•
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involve and retain to a greater degree outside counsel and accountants in the activities listed above;
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•
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enhance Allegiance's investor relations function;
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•
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establish new internal policies, including those relating to trading in our securities and disclosure controls and procedures;
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•
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retain additional personnel;
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•
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comply with The NASDAQ Stock Market listing standards; and
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•
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comply with the Sarbanes-Oxley Act.
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•
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staggered terms for directors, who may be removed from office only for cause;
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•
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a provision establishing certain advance notice procedures for nomination of candidates for election as directors and for shareholder proposals; and
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•
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a provision that any special meeting of Allegiance's shareholders may be called only by a majority of the Board of Directors, the President or a holder or group of holders of at least 50% of Allegiance shares entitled to vote at the meeting.
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Office
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Location
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Own or Lease
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Square Feet
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290 Office
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13100 Northwest Freeway, Suite 100
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Lease
|
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11,312
|
|
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Houston, Texas 77040
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|
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Bellaire Office
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5410 Bellaire Blvd.
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Lease
|
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6,238
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Bellaire, Texas 77401
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|
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Brookshire Office
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550 FM 1489
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Own
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4,000
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Brookshire, Texas 77423
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Clear Lake Office
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2200 NASA Road One
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Lease
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7,998
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Houston, Texas 77058
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Eldridge Office
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2401 Eldridge Parkway South
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Own
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4,530
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Houston, Texas 77077
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|
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Galleria Office
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1455 West Loop South, Suite 150
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Lease
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4,864
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Houston, Texas 77027
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Gulf Freeway Office
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7125 Gulf Freeway
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Own
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4,900
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|
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Houston, Texas 77087
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|
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Heights Office
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2222 North Durham
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Own
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4,666
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|
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Houston, Texas 77008
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Katy Office
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520 Westgreen Blvd.
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Own
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4,811
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Katy, Texas 77450
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Katy-Pin Oak Office
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722 Pin Oak Road
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Lease
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5,102
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|
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Katy, Texas 77494
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|
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Kirby Office
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3963 Kirby Drive
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Lease
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|
6,932
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|
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Houston, Texas 77098
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|
|
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|
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Palm Center Loan Production Office
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5330 Griggs Road, Suite A101
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Lease
|
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231
|
|
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Houston, Texas 77021
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|
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|
|
|
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Memorial Spring Branch Office
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8800 Katy Freeway, Suite 110
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Lease
|
|
8,348
|
|
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Houston, Texas 77024
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|
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North Loop Office
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1405 North Loop West
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Own
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6,000
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|
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Houston, Texas 77008
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|
|
|
|
|
|
|
|
|
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Town & Country Office
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650 W. Bough Lane, Suite 140
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|
Lease
|
|
2,791
|
|
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Houston, Texas 77024
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|
|
|
|
|
|
|
|
|
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West Belt Office
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|
8727 W. Sam Houston Parkway N.
|
|
Lease
|
|
22,412
|
|
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Houston, Texas 77040
|
|
|
|
|
|
|
|
|
|
|
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Allegiance Corporate Office
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|
8847 W. Sam Houston Parkway N., Suite 200
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|
Lease
|
|
15,248
|
|
|
Houston, Texas 77040
|
|
|
|
|
|
|
|
|
|
|
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Woodway West Office
|
|
6363 Woodway
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|
Lease
|
|
6,123
|
|
|
Houston, Texas 77057
|
|
|
|
|
Plan Category
|
|
Number of securities to be issued upon exercise of outstanding options, warrants and rights
(a)
|
|
Weighted-average exercise price of outstanding options, warrants and rights
(b)
|
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Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
(c)
|
||||
Equity compensation plans approved by security holders
|
|
774,748
|
|
|
$
|
19.94
|
|
|
633,166
|
|
Equity compensation plans not approved by security holders
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Total
|
|
774,748
|
|
|
|
|
633,166
|
|
|
|
October 8, 2015
|
|
December 31, 2015
|
|
June 30, 2016
|
|
December 31, 2016
|
|
June 30, 2017
|
|
December 31, 2017
|
||||||||||||
Allegiance Bancshares, Inc.
|
|
$
|
100.00
|
|
|
$
|
102.29
|
|
|
$
|
107.61
|
|
|
$
|
156.36
|
|
|
$
|
165.66
|
|
|
$
|
162.85
|
|
S&P 500
|
|
100.00
|
|
|
107.04
|
|
|
111.15
|
|
|
119.84
|
|
|
131.04
|
|
|
146.01
|
|
||||||
NASDAQ Bank
|
|
100.00
|
|
|
103.37
|
|
|
99.95
|
|
|
141.72
|
|
|
138.82
|
|
|
149.18
|
|
|
As of and for the Years Ended December 31,
|
||||||||||||||||||
|
2017
|
|
2016
(1)
|
|
2015
(2)
|
|
2014
|
|
2013
(3)
|
||||||||||
|
(Dollars in thousands, except per share amounts)
|
||||||||||||||||||
Selected Period End Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and cash equivalents
|
$
|
182,103
|
|
|
$
|
142,098
|
|
|
$
|
148,431
|
|
|
$
|
167,540
|
|
|
$
|
213,076
|
|
Available for sale securities
|
309,615
|
|
|
316,455
|
|
|
165,097
|
|
|
84,962
|
|
|
87,007
|
|
|||||
Loans held for sale
|
—
|
|
|
—
|
|
|
27,887
|
|
|
—
|
|
|
—
|
|
|||||
Loans held for investment
|
2,270,876
|
|
|
1,891,635
|
|
|
1,653,165
|
|
|
1,002,054
|
|
|
836,694
|
|
|||||
Allowance for loan losses
|
23,649
|
|
|
17,911
|
|
|
13,098
|
|
|
8,246
|
|
|
6,655
|
|
|||||
Goodwill and intangible assets, net
|
42,663
|
|
|
43,444
|
|
|
44,619
|
|
|
12,891
|
|
|
13,044
|
|
|||||
Total assets
|
2,860,231
|
|
|
2,450,948
|
|
|
2,084,579
|
|
|
1,280,008
|
|
|
1,164,759
|
|
|||||
Noninterest-bearing deposits
|
683,110
|
|
|
593,751
|
|
|
620,320
|
|
|
373,795
|
|
|
325,410
|
|
|||||
Interest-bearing deposits
|
1,530,864
|
|
|
1,276,432
|
|
|
1,138,813
|
|
|
759,889
|
|
|
719,921
|
|
|||||
Total deposits
|
2,213,974
|
|
|
1,870,183
|
|
|
1,759,133
|
|
|
1,133,684
|
|
|
1,045,331
|
|
|||||
Total shareholders’ equity
|
306,865
|
|
|
279,817
|
|
|
258,490
|
|
|
131,778
|
|
|
109,736
|
|
|||||
Total common shareholders' equity
|
306,865
|
|
|
279,817
|
|
|
258,490
|
|
|
131,778
|
|
|
109,736
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Selected Income Statement Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net interest income
|
$
|
103,668
|
|
|
$
|
89,864
|
|
|
$
|
80,166
|
|
|
$
|
46,834
|
|
|
$
|
33,891
|
|
Provision for loan losses
|
13,188
|
|
|
5,469
|
|
|
5,792
|
|
|
2,150
|
|
|
240
|
|
|||||
Net interest income after provision for loan losses
|
90,480
|
|
|
84,395
|
|
|
74,374
|
|
|
44,684
|
|
|
33,651
|
|
|||||
Noninterest income
|
5,861
|
|
|
7,268
|
|
|
3,992
|
|
|
2,607
|
|
|
1,639
|
|
|||||
Noninterest expense
|
69,962
|
|
|
59,258
|
|
|
54,805
|
|
|
33,458
|
|
|
24,598
|
|
|||||
Net income before income taxes
|
26,379
|
|
|
32,405
|
|
|
23,561
|
|
|
13,833
|
|
|
10,692
|
|
|||||
Net income
|
17,632
|
|
|
22,851
|
|
|
15,786
|
|
|
9,005
|
|
|
6,839
|
|
|||||
Net income attributable to common shareholders
(4)
|
17,632
|
|
|
22,851
|
|
|
15,227
|
|
|
9,005
|
|
|
6,839
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Selected Per Share Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Earnings per common share, basic
|
$
|
1.34
|
|
|
$
|
1.78
|
|
|
$
|
1.45
|
|
|
$
|
1.29
|
|
|
$
|
1.25
|
|
Earnings per common share, diluted
|
1.31
|
|
|
1.75
|
|
|
1.43
|
|
|
1.26
|
|
|
1.22
|
|
|||||
Book value per common share
|
23.20
|
|
|
21.59
|
|
|
20.17
|
|
|
17.62
|
|
|
15.78
|
|
|||||
Tangible book value per common share
(5)
|
19.97
|
|
|
18.24
|
|
|
16.69
|
|
|
15.90
|
|
|
13.91
|
|
|||||
Weighted average common shares outstanding, basic
|
13,124,900
|
|
|
12,873,326
|
|
|
10,470,465
|
|
|
6,978,025
|
|
|
5,449,700
|
|
|||||
Weighted average common shares outstanding, diluted
|
13,457,718
|
|
|
13,073,932
|
|
|
10,654,003
|
|
|
7,142,377
|
|
|
5,621,042
|
|
|||||
Shares outstanding at end of period
|
13,226,826
|
|
|
12,958,341
|
|
|
12,812,985
|
|
|
7,477,309
|
|
|
6,953,125
|
|
|
As of and for the Years Ended December 31,
|
|||||||||||||
|
2017
|
|
2016
(1)
|
|
2015
(2)
|
|
2014
|
|
2013
(3)
|
|||||
|
(Dollars in thousands)
|
|||||||||||||
Selected Performance Metrics:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average assets
(6)
|
0.65
|
%
|
|
0.98
|
%
|
|
0.81
|
%
|
|
0.75
|
%
|
|
0.78
|
%
|
Return on average common equity
(6)
|
5.92
|
%
|
|
8.36
|
%
|
|
7.43
|
%
|
|
7.73
|
%
|
|
9.02
|
%
|
Return on average tangible common equity
(5)(6)
|
6.93
|
%
|
|
9.96
|
%
|
|
9.52
|
%
|
|
8.70
|
%
|
|
9.22
|
%
|
Tax equivalent net interest margin
(6)(7)
|
4.34
|
%
|
|
4.37
|
%
|
|
4.68
|
%
|
|
4.31
|
%
|
|
4.19
|
%
|
Efficiency ratio
(8)
|
63.89
|
%
|
|
62.34
|
%
|
|
65.27
|
%
|
|
67.79
|
%
|
|
69.23
|
%
|
Loans to deposits ratio
|
102.57
|
%
|
|
101.15
|
%
|
|
95.56
|
%
|
|
88.39
|
%
|
|
80.04
|
%
|
Noninterest expense to average assets
(6)
|
2.59
|
%
|
|
2.53
|
%
|
|
2.83
|
%
|
|
2.80
|
%
|
|
2.82
|
%
|
|
|
|
|
|
|
|
|
|
|
|||||
Selected Credit Quality Ratios:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonperforming assets to total assets
(9)
|
0.49
|
%
|
|
0.75
|
%
|
|
0.25
|
%
|
|
0.25
|
%
|
|
0.25
|
%
|
Nonperforming loans to total loans
(10)
|
0.59
|
%
|
|
0.88
|
%
|
|
0.31
|
%
|
|
0.32
|
%
|
|
0.31
|
%
|
Allowance for loan losses to nonperforming loans
(10)
|
177.44
|
%
|
|
107.26
|
%
|
|
252.66
|
%
|
|
258.98
|
%
|
|
258.75
|
%
|
Allowance for loan losses to total loans
|
1.04
|
%
|
|
0.95
|
%
|
|
0.78
|
%
|
|
0.82
|
%
|
|
0.80
|
%
|
Provision for loan losses to average loans
(6)
|
0.63
|
%
|
|
0.31
|
%
|
|
0.38
|
%
|
|
0.23
|
%
|
|
0.04
|
%
|
Net charge-offs to average loans
(6)
|
0.36
|
%
|
|
0.04
|
%
|
|
0.06
|
%
|
|
0.06
|
%
|
|
0.02
|
%
|
|
|
|
|
|
|
|
|
|
|
|||||
Capital Ratios:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common equity Tier 1 capital ratio
|
10.54
|
%
|
|
11.30
|
%
|
|
11.72
|
%
|
|
N/A
|
|
|
N/A
|
|
Leverage capital ratio
|
9.84
|
%
|
|
10.35
|
%
|
|
11.02
|
%
|
|
9.55
|
%
|
|
9.61
|
%
|
Tier 1 risk-based capital
|
10.92
|
%
|
|
11.73
|
%
|
|
12.21
|
%
|
|
11.96
|
%
|
|
11.60
|
%
|
Total risk-based capital
|
13.43
|
%
|
|
12.57
|
%
|
|
12.92
|
%
|
|
12.80
|
%
|
|
12.39
|
%
|
Total equity to total assets
|
10.73
|
%
|
|
11.42
|
%
|
|
12.40
|
%
|
|
10.30
|
%
|
|
9.42
|
%
|
Tangible common equity to tangible assets
(5)
|
9.38
|
%
|
|
9.82
|
%
|
|
10.48
|
%
|
|
9.38
|
%
|
|
8.40
|
%
|
(1)
|
We completed the sale of two acquired F&M Bancshares branches during the first quarter of 2016.
|
(2)
|
We completed the acquisition of F&M Bancshares on January 1, 2015.
|
(3)
|
We completed the acquisition of Independence Bank, National Association on November 16, 2013.
|
(4)
|
On January 1, 2015, we issued shares of Series A and Series B preferred stock, in connection with the acquisition of F&M Bancshares, which had preferred stock outstanding pursuant to the U.S. Treasury’s Troubled Asset Relief Program. We paid $559 thousand in preferred dividends during 2015. On July 15, 2015, we redeemed all of the outstanding shares of Series A and Series B preferred stock with cash on hand for an aggregate redemption price of $11.7 million (which is the sum of the liquidation amount plus accrued and unpaid dividends up to, but excluding, the redemption date).
|
(5)
|
This is a non-GAAP financial measure. See our reconciliation of non-GAAP financial measures presented in the foregoing selected financial information to their most directly comparable GAAP financial measures under the caption Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations—GAAP Reconciliation and Management’s Explanation of Non-GAAP Financial Measures.”
|
(6)
|
Except as otherwise indicated in this footnote, we calculate our average assets and average common equity for a period by dividing the sum of total assets or total common shareholders’ equity, as the case may be, as of the close of business on each day in the relevant period, by the number of days in the period. We calculate return on average assets by dividing net income for that period by average assets. We calculate return on average common equity for a period by dividing net income attributable to common shareholders for that period by average common equity and average tangible common equity, as the case may be, for that period.
|
(7)
|
Net interest margin represents net interest income divided by average interest-earning assets.
|
(8)
|
Efficiency ratio represents total noninterest expense divided by the sum of net interest income plus noninterest income, excluding net gains and losses on the sale of loans, securities and assets (including the sale of the two acquired Central Texas branches). Additionally, taxes and provision for loan losses are not part of this calculation.
|
(9)
|
Nonperforming assets include nonaccrual loans, loans past due 90 days or more and still accruing interest, repossessed assets and other real estate.
|
(10)
|
Nonperforming loans include nonaccrual loans and loans past due 90 days or more and still accruing interest.
|
•
|
risks related to the concentration of our business in the Houston metropolitan area, including risks associated with volatility or decreases in oil and gas prices or prolonged periods of lower oil and gas prices;
|
•
|
general market conditions and economic trends nationally, regionally and particularly in the Houston metropolitan area;
|
•
|
our ability to retain executive officers and key employees and their customer and community relationships;
|
•
|
our ability to recruit and retain successful bankers that meet our expectations in terms of customer and community relationships and profitability;
|
•
|
risks related to our strategic focus on lending to small to medium-sized businesses;
|
•
|
our ability to implement our growth strategy, including through the identification of acquisition candidates that will be accretive to our financial condition and results of operations, as well as permitting decision-making authority at the branch level;
|
•
|
risks related to any businesses we acquire in the future, including exposure to potential asset and credit quality risks and unknown or contingent liabilities, the time and costs associated with integrating systems, technology platforms, procedures and personnel, the need for additional capital to finance such transactions and possible failures in realizing the anticipated benefits from such acquisitions;
|
•
|
risks associated with our owner-occupied commercial real estate loan and other commercial real estate loan portfolios, including the risks inherent in the valuation of the collateral securing such loans;
|
•
|
risks associated with our commercial and industrial loan portfolio, including the risk for deterioration in value of the general business assets that generally secure such loans;
|
•
|
the accuracy and sufficiency of the assumptions and estimates we make in establishing reserves for potential loan losses and other estimates;
|
•
|
risk of deteriorating asset quality and higher loan charge-offs, as well as the time and effort necessary to resolve nonperforming assets;
|
•
|
potential changes in the prices, values and sales volumes of commercial and residential real estate securing our real estate loans;
|
•
|
changes in market interest rates that affect the pricing of our loans and deposits and our net interest income;
|
•
|
potential fluctuations in the market value and liquidity of the securities we hold for sale;
|
•
|
risk of impairment of investment securities, goodwill, other intangible assets or deferred tax assets;
|
•
|
the effects of competition from a wide variety of local, regional, national and other providers of financial, investment and insurance services, which may adversely affect our pricing and terms;
|
•
|
risks associated with negative public perception of the Company;
|
•
|
our ability to maintain an effective system of disclosure controls and procedures and internal controls over financial reporting;
|
•
|
risks associated with fraudulent and negligent acts by our customers, employees or vendors;
|
•
|
our ability to keep pace with technological change or difficulties when implementing new technologies;
|
•
|
risks associated with system failures or failures to protect against cybersecurity threats, such as breaches of our network security;
|
•
|
our ability to comply with privacy laws and properly safeguard personal, confidential or proprietary information;
|
•
|
risks associated with data processing system failures and errors;
|
•
|
potential risk of environmental liability related to owning or foreclosing on real property;
|
•
|
the institution and outcome of litigation and other legal proceeding against us or to which we become subject;
|
•
|
our ability to maintain adequate liquidity and to raise necessary capital to fund our acquisition strategy and operations or to meet increased minimum regulatory capital levels;
|
•
|
our ability to comply with various governmental and regulatory requirements applicable to financial institutions;
|
•
|
the impact of recent and future legislative and regulatory changes, including changes in banking, securities and tax laws and regulations and their application by our regulators, such as the further implementation of the Dodd-Frank Act;
|
•
|
governmental monetary and fiscal policies, including the policies of the Federal Reserve;
|
•
|
our ability to comply with supervisory actions by federal and state banking agencies;
|
•
|
changes in the scope and cost of FDIC insurance and other coverage;
|
•
|
systemic risks associated with the soundness of other financial institutions;
|
•
|
the effects of war or other conflicts, acts of terrorism (including cyberattacks) or other catastrophic events, including storms, droughts, tornadoes and flooding, that may affect general economic conditions; and
|
•
|
other risks and uncertainties listed from time to time in our reports and documents filed with the SEC.
|
|
For the Years Ended December 31,
|
|||||||||||||||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||||||||||||||
|
Average Balance
|
|
Interest Earned/ Interest Paid
|
|
Average Yield/ Rate
|
|
Average Balance
|
|
Interest Earned/ Interest Paid
|
|
Average Yield/ Rate
|
|
Average Balance
|
|
Interest Earned/ Interest Paid
|
|
Average Yield/ Rate
|
|||||||||||||||
|
(Dollars in thousands)
|
|||||||||||||||||||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Interest-Earning Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Loans
(1)
|
$
|
2,081,370
|
|
|
$
|
110,331
|
|
|
5.30
|
%
|
|
$
|
1,755,319
|
|
|
$
|
93,356
|
|
|
5.32
|
%
|
|
$
|
1,525,325
|
|
|
$
|
85,443
|
|
|
5.60
|
%
|
Securities
|
324,926
|
|
|
8,445
|
|
|
2.60
|
%
|
|
270,789
|
|
|
6,851
|
|
|
2.53
|
%
|
|
136,277
|
|
|
3,124
|
|
|
2.29
|
%
|
||||||
Deposits in other financial institutions
|
50,917
|
|
|
662
|
|
|
1.30
|
%
|
|
87,485
|
|
|
571
|
|
|
0.65
|
%
|
|
73,995
|
|
|
239
|
|
|
0.32
|
%
|
||||||
Total interest-earning assets
|
2,457,213
|
|
|
$
|
119,438
|
|
|
4.86
|
%
|
|
2,113,593
|
|
|
$
|
100,778
|
|
|
4.77
|
%
|
|
1,735,597
|
|
|
$
|
88,806
|
|
|
5.12
|
%
|
|||
Allowance for loan losses
|
(20,536
|
)
|
|
|
|
|
|
(15,200
|
)
|
|
|
|
|
|
(10,004
|
)
|
|
|
|
|
|
|
||||||||||
Noninterest-earning assets
|
262,549
|
|
|
|
|
|
|
240,202
|
|
|
|
|
|
|
211,419
|
|
|
|
|
|
|
|
||||||||||
Total assets
|
$
|
2,699,226
|
|
|
|
|
|
|
$
|
2,338,595
|
|
|
|
|
|
|
$
|
1,937,012
|
|
|
|
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Liabilities and Shareholders' Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest-Bearing Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest-bearing demand deposits
|
$
|
156,527
|
|
|
$
|
597
|
|
|
0.38
|
%
|
|
$
|
104,212
|
|
|
$
|
334
|
|
|
0.32
|
%
|
|
$
|
100,139
|
|
|
$
|
163
|
|
|
0.16
|
%
|
Money market and savings deposits
|
536,415
|
|
|
2,562
|
|
|
0.48
|
%
|
|
465,403
|
|
|
2,103
|
|
|
0.45
|
%
|
|
429,153
|
|
|
1,838
|
|
|
0.43
|
%
|
||||||
Certificates and other time deposits
|
748,086
|
|
|
9,060
|
|
|
1.21
|
%
|
|
648,075
|
|
|
7,044
|
|
|
1.09
|
%
|
|
559,247
|
|
|
5,272
|
|
|
0.94
|
%
|
||||||
Borrowed funds
|
269,633
|
|
|
2,922
|
|
|
1.08
|
%
|
|
209,379
|
|
|
945
|
|
|
0.45
|
%
|
|
66,343
|
|
|
789
|
|
|
1.19
|
%
|
||||||
Subordinated debt
|
11,208
|
|
|
629
|
|
|
5.61
|
%
|
|
9,138
|
|
|
488
|
|
|
5.34
|
%
|
|
9,004
|
|
|
578
|
|
|
6.42
|
%
|
||||||
Total interest-bearing liabilities
|
1,721,869
|
|
|
$
|
15,770
|
|
|
0.92
|
%
|
|
1,436,207
|
|
|
$
|
10,914
|
|
|
0.76
|
%
|
|
1,163,886
|
|
|
$
|
8,640
|
|
|
0.74
|
%
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Noninterest-Bearing liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Noninterest-bearing demand deposits
|
672,101
|
|
|
|
|
|
|
620,701
|
|
|
|
|
|
|
554,704
|
|
|
|
|
|
|
|
||||||||||
Other liabilities
|
7,629
|
|
|
|
|
|
|
8,476
|
|
|
|
|
|
|
7,316
|
|
|
|
|
|
|
|
||||||||||
Total liabilities
|
2,401,599
|
|
|
|
|
|
|
2,065,384
|
|
|
|
|
|
|
1,725,906
|
|
|
|
|
|
|
|
||||||||||
|
297,627
|
|
|
|
|
|
|
273,211
|
|
|
|
|
|
|
211,106
|
|
|
|
|
|
|
|
||||||||||
Total liabilities and shareholders' equity
|
$
|
2,699,226
|
|
|
|
|
|
|
$
|
2,338,595
|
|
|
|
|
|
|
$
|
1,937,012
|
|
|
|
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Net interest rate spread
|
|
|
|
|
|
3.94
|
%
|
|
|
|
|
|
|
4.01
|
%
|
|
|
|
|
|
|
|
4.38
|
%
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Net interest income and margin
(2)
|
|
|
|
$
|
103,668
|
|
|
4.22
|
%
|
|
|
|
|
$
|
89,864
|
|
|
4.25
|
%
|
|
|
|
|
$
|
80,166
|
|
|
4.62
|
%
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Net interest income and margin (tax equivalent)
(3)
|
|
|
|
$
|
106,669
|
|
|
4.34
|
%
|
|
|
|
|
$
|
92,330
|
|
|
4.37
|
%
|
|
|
|
|
$
|
81,156
|
|
|
4.68
|
%
|
(1)
|
Includes loans held for sale.
|
(2)
|
The net interest margin is equal to net interest income divided by average interest-earning assets.
|
(3)
|
In order to make pretax income and resultant yields on tax-exempt investments and loans comparable to those on taxable investments and loans, a tax-equivalent adjustment has been computed using a federal income tax rate of 35% for the years ended
December 31, 2017
,
2016
and
2015
and other applicable effective tax rates.
|
|
For the Years Ended December 31,
|
||||||||||||||||||||||||||||||
|
2017 vs. 2016
|
|
2016 vs. 2015
|
||||||||||||||||||||||||||||
|
Increase
(Decrease)
Due to Change in
|
|
|
|
Increase
(Decrease)
Due to Change in
|
|
|
||||||||||||||||||||||||
|
Volume
|
|
Rate
|
|
Number of Days
|
|
Total
|
|
Volume
|
|
Rate
|
|
Number of Days
|
|
Total
|
||||||||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||||||||||||||
Interest-Earning assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Loans
|
$
|
17,294
|
|
|
$
|
(64
|
)
|
|
$
|
(255
|
)
|
|
$
|
16,975
|
|
|
$
|
12,919
|
|
|
$
|
(5,239
|
)
|
|
$
|
234
|
|
|
$
|
7,914
|
|
Securities
|
1,387
|
|
|
226
|
|
|
(19
|
)
|
|
1,594
|
|
|
3,075
|
|
|
643
|
|
|
9
|
|
|
3,727
|
|
||||||||
Deposits in other financial institutions
|
(237
|
)
|
|
330
|
|
|
(2
|
)
|
|
91
|
|
|
44
|
|
|
287
|
|
|
1
|
|
|
332
|
|
||||||||
Total increase (decrease) in interest income
|
18,444
|
|
|
492
|
|
|
(276
|
)
|
|
18,660
|
|
|
16,038
|
|
|
(4,309
|
)
|
|
244
|
|
|
11,973
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Interest-Bearing liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Interest-bearing demand deposits
|
169
|
|
|
95
|
|
|
(1
|
)
|
|
263
|
|
|
13
|
|
|
(3
|
)
|
|
1
|
|
|
11
|
|
||||||||
Money market and savings deposits
|
327
|
|
|
138
|
|
|
(6
|
)
|
|
459
|
|
|
149
|
|
|
110
|
|
|
5
|
|
|
264
|
|
||||||||
Certificates and other time deposits
|
1,106
|
|
|
929
|
|
|
(19
|
)
|
|
2,016
|
|
|
812
|
|
|
1,108
|
|
|
14
|
|
|
1,934
|
|
||||||||
Borrowed funds
|
275
|
|
|
1,705
|
|
|
(3
|
)
|
|
1,977
|
|
|
3,484
|
|
|
(3,330
|
)
|
|
2
|
|
|
156
|
|
||||||||
Subordinated debt
|
112
|
|
|
30
|
|
|
(1
|
)
|
|
141
|
|
|
9
|
|
|
(101
|
)
|
|
2
|
|
|
(90
|
)
|
||||||||
Total increase (decrease) in interest expense
|
1,989
|
|
|
2,897
|
|
|
(30
|
)
|
|
4,856
|
|
|
4,467
|
|
|
(2,216
|
)
|
|
24
|
|
|
2,275
|
|
||||||||
Total increase (decrease) in net interest income
|
$
|
16,455
|
|
|
$
|
(2,405
|
)
|
|
$
|
(246
|
)
|
|
$
|
13,804
|
|
|
$
|
11,571
|
|
|
$
|
(2,093
|
)
|
|
$
|
220
|
|
|
$
|
9,698
|
|
|
For the Years
Ended December 31,
|
|
Increase
|
|
For the Years
Ended December 31,
|
|
Increase
|
||||||||||||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
2016
|
|
2015
|
|
(Decrease)
|
||||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||||||
Nonsufficient funds fees
|
$
|
685
|
|
|
$
|
661
|
|
|
$
|
24
|
|
|
$
|
661
|
|
|
$
|
703
|
|
|
$
|
(42
|
)
|
Service charges on deposit accounts
|
783
|
|
|
677
|
|
|
106
|
|
|
677
|
|
|
680
|
|
|
(3
|
)
|
||||||
Gain on sale of branch assets
|
—
|
|
|
2,050
|
|
|
(2,050
|
)
|
|
2,050
|
|
|
—
|
|
|
2,050
|
|
||||||
Gain (loss) on sale of securities
|
18
|
|
|
30
|
|
|
(12
|
)
|
|
30
|
|
|
(37
|
)
|
|
67
|
|
||||||
Gain (loss) on sale of other real estate
|
6
|
|
|
266
|
|
|
(260
|
)
|
|
266
|
|
|
(5
|
)
|
|
271
|
|
||||||
Gain on sale of loans
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
235
|
|
|
(235
|
)
|
||||||
Bank owned life insurance income
|
585
|
|
|
626
|
|
|
(41
|
)
|
|
626
|
|
|
604
|
|
|
22
|
|
||||||
Debit card and ATM card income
|
929
|
|
|
725
|
|
|
204
|
|
|
725
|
|
|
638
|
|
|
87
|
|
||||||
Rebate from correspondent bank
|
1,327
|
|
|
650
|
|
|
677
|
|
|
650
|
|
|
254
|
|
|
396
|
|
||||||
Other
(1)
|
1,528
|
|
|
1,583
|
|
|
(55
|
)
|
|
1,583
|
|
|
920
|
|
|
663
|
|
||||||
Total noninterest income
|
$
|
5,861
|
|
|
$
|
7,268
|
|
|
$
|
(1,407
|
)
|
|
$
|
7,268
|
|
|
$
|
3,992
|
|
|
$
|
3,276
|
|
(1)
|
Other includes wire transfer and letter of credit fees, among other items.
|
|
For the Years
Ended December 31,
|
|
Increase
|
|
For the Years
Ended December 31,
|
|
Increase
|
||||||||||||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
2016
|
|
2015
|
|
(Decrease)
|
||||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||||||
Salaries and employee benefits
(1)
|
$
|
44,745
|
|
|
$
|
38,858
|
|
|
$
|
5,887
|
|
|
$
|
38,858
|
|
|
$
|
35,324
|
|
|
$
|
3,534
|
|
Net occupancy and equipment
|
5,452
|
|
|
4,944
|
|
|
508
|
|
|
4,944
|
|
|
4,826
|
|
|
118
|
|
||||||
Depreciation
|
1,637
|
|
|
1,627
|
|
|
10
|
|
|
1,627
|
|
|
1,614
|
|
|
13
|
|
||||||
Data processing and software amortization
|
4,047
|
|
|
2,633
|
|
|
1,414
|
|
|
2,633
|
|
|
3,044
|
|
|
(411
|
)
|
||||||
Professional fees
|
2,926
|
|
|
2,234
|
|
|
692
|
|
|
2,234
|
|
|
1,671
|
|
|
563
|
|
||||||
Regulatory assessments and FDIC insurance
|
2,273
|
|
|
1,581
|
|
|
692
|
|
|
1,581
|
|
|
1,346
|
|
|
235
|
|
||||||
Core deposit intangibles amortization
|
781
|
|
|
785
|
|
|
(4
|
)
|
|
785
|
|
|
830
|
|
|
(45
|
)
|
||||||
Communications
|
983
|
|
|
1,055
|
|
|
(72
|
)
|
|
1,055
|
|
|
1,290
|
|
|
(235
|
)
|
||||||
Advertising
|
1,289
|
|
|
945
|
|
|
344
|
|
|
945
|
|
|
781
|
|
|
164
|
|
||||||
Other real estate expense
|
331
|
|
|
189
|
|
|
142
|
|
|
189
|
|
|
199
|
|
|
(10
|
)
|
||||||
Printing and supplies
|
299
|
|
|
241
|
|
|
58
|
|
|
241
|
|
|
297
|
|
|
(56
|
)
|
||||||
Other
|
5,199
|
|
|
4,166
|
|
|
1,033
|
|
|
4,166
|
|
|
3,583
|
|
|
583
|
|
||||||
Total noninterest expense
|
$
|
69,962
|
|
|
$
|
59,258
|
|
|
$
|
10,704
|
|
|
$
|
59,258
|
|
|
$
|
54,805
|
|
|
$
|
4,453
|
|
(1)
|
Total salaries and employee benefits includes $1.8 million, $1.5 million and $1.4 million in stock based compensation expense for the years ended December 31, 2017, 2016 and 2015, respectively.
|
|
Interest
|
|
Net Interest
|
|
Net Income
Attributable to Common |
|
Earnings Per Share
(1)
|
||||||||||||
|
Income
|
|
Income
|
|
Shareholders
|
|
Basic
|
|
Diluted
|
||||||||||
|
(Dollars in thousands, except per share data)
|
||||||||||||||||||
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
First quarter
|
$
|
27,512
|
|
|
$
|
24,128
|
|
|
$
|
6,047
|
|
|
$
|
0.46
|
|
|
$
|
0.45
|
|
Second quarter
|
28,987
|
|
|
25,107
|
|
|
5,395
|
|
|
0.41
|
|
|
0.40
|
|
|||||
Third quarter
|
30,901
|
|
|
26,997
|
|
|
2,986
|
|
|
0.23
|
|
|
0.22
|
|
|||||
Fourth quarter
|
32,038
|
|
|
27,436
|
|
|
3,204
|
|
|
0.24
|
|
|
0.24
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
First quarter
|
$
|
23,451
|
|
|
$
|
21,084
|
|
|
$
|
6,355
|
|
|
$
|
0.49
|
|
|
$
|
0.49
|
|
Second quarter
|
24,527
|
|
|
21,949
|
|
|
5,254
|
|
|
0.41
|
|
|
0.40
|
|
|||||
Third quarter
|
26,319
|
|
|
23,409
|
|
|
5,471
|
|
|
0.42
|
|
|
0.42
|
|
|||||
Fourth quarter
|
26,481
|
|
|
23,422
|
|
|
5,771
|
|
|
0.45
|
|
|
0.44
|
|
(1)
|
Earnings per share are computed independently for each of the quarters presented and therefore may not total earnings per share for the year.
|
|
As of December 31,
|
|||||||||||||||||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|||||||||||||||||||||||||
|
Amount
|
|
Percent
|
|
Amount
|
|
Percent
|
|
Amount
|
|
Percent
|
|
Amount
|
|
Percent
|
|
Amount
|
|
Percent
|
|||||||||||||||
|
(Dollars in thousands)
|
|||||||||||||||||||||||||||||||||
Loans held for sale
(1)
|
$
|
—
|
|
|
0.0
|
%
|
|
$
|
—
|
|
|
0.0
|
%
|
|
$
|
27,887
|
|
|
1.7
|
%
|
|
$
|
—
|
|
|
0.0
|
%
|
|
$
|
—
|
|
|
0.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Commercial and industrial
|
$
|
457,129
|
|
|
20.1
|
%
|
|
$
|
416,752
|
|
|
22.0
|
%
|
|
$
|
383,044
|
|
|
22.7
|
%
|
|
$
|
242,034
|
|
|
24.2
|
%
|
|
$
|
227,382
|
|
|
27.2
|
%
|
Mortgage warehouse
|
69,456
|
|
|
3.1
|
%
|
|
67,038
|
|
|
3.5
|
%
|
|
59,071
|
|
|
3.5
|
%
|
|
28,329
|
|
|
2.8
|
%
|
|
—
|
|
|
0.0
|
%
|
|||||
Real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Commercial real estate (including multi-family residential)
|
1,080,247
|
|
|
47.5
|
%
|
|
891,989
|
|
|
47.2
|
%
|
|
745,595
|
|
|
44.4
|
%
|
|
429,986
|
|
|
42.9
|
%
|
|
401,048
|
|
|
47.9
|
%
|
|||||
Commercial real estate construction and land development
|
243,389
|
|
|
10.7
|
%
|
|
159,247
|
|
|
8.4
|
%
|
|
154,646
|
|
|
9.2
|
%
|
|
85,484
|
|
|
8.5
|
%
|
|
71,633
|
|
|
8.6
|
%
|
|||||
1-4 family residential (including home equity)
|
301,219
|
|
|
13.3
|
%
|
|
246,987
|
|
|
13.1
|
%
|
|
205,200
|
|
|
12.2
|
%
|
|
135,127
|
|
|
13.5
|
%
|
|
89,334
|
|
|
10.7
|
%
|
|||||
Residential construction
|
109,116
|
|
|
4.8
|
%
|
|
98,657
|
|
|
5.2
|
%
|
|
93,848
|
|
|
5.6
|
%
|
|
72,402
|
|
|
7.2
|
%
|
|
38,891
|
|
|
4.6
|
%
|
|||||
Consumer and other
|
10,320
|
|
|
0.5
|
%
|
|
10,965
|
|
|
0.6
|
%
|
|
11,761
|
|
|
0.7
|
%
|
|
8,692
|
|
|
0.9
|
%
|
|
8,406
|
|
|
1.0
|
%
|
|||||
Total loans held for investment
|
2,270,876
|
|
|
100.0
|
%
|
|
1,891,635
|
|
|
100.0
|
%
|
|
1,653,165
|
|
|
98.3
|
%
|
|
1,002,054
|
|
|
100.0
|
%
|
|
836,694
|
|
|
100.0
|
%
|
|||||
Total loans
|
2,270,876
|
|
|
100.0
|
%
|
|
1,891,635
|
|
|
100.0
|
%
|
|
1,681,052
|
|
|
100.0
|
%
|
|
1,002,054
|
|
|
100.0
|
%
|
|
836,694
|
|
|
100.0
|
%
|
|||||
Allowance for Loan Losses
|
(23,649
|
)
|
|
|
|
(17,911
|
)
|
|
|
|
|
(13,098
|
)
|
|
|
|
|
(8,246
|
)
|
|
|
|
|
(6,655
|
)
|
|
|
|
||||||
Loans, net
|
$
|
2,247,227
|
|
|
|
|
$
|
1,873,724
|
|
|
|
|
|
$
|
1,667,954
|
|
|
|
|
|
$
|
993,808
|
|
|
|
|
|
$
|
830,039
|
|
|
|
|
(1)
|
Consists of loans at two former F&M Bancshares locations that the Company acquired on January 1, 2015. As of December 31, 2015, loans held for sale consisted of $13.2 million of commercial and industrial loans, $11.6 million of commercial real estate (including multifamily residential) loans, $2.3 million of l-4 family residential (including home equity) loans and $803 thousand of consumer and other loans. Loans held for sale are carried at lower of aggregate cost or fair value.
|
|
As of December 31, 2017
|
||||||||||||||
|
Due in
One Year
or Less
|
|
Due After
One Year
Through
Five Years
|
|
Due After
Five Years
|
|
Total
|
||||||||
|
(Dollars in thousands)
|
||||||||||||||
Commercial and industrial
|
$
|
190,585
|
|
|
$
|
209,797
|
|
|
$
|
56,747
|
|
|
$
|
457,129
|
|
Mortgage warehouse
|
69,456
|
|
|
—
|
|
|
—
|
|
|
69,456
|
|
||||
Real estate:
|
|
|
|
|
|
|
|
||||||||
Commercial real estate (including multi-family residential)
|
126,169
|
|
|
716,868
|
|
|
237,210
|
|
|
1,080,247
|
|
||||
Commercial real estate construction and land development
|
69,291
|
|
|
139,956
|
|
|
34,142
|
|
|
243,389
|
|
||||
1-4 family residential (including home equity)
|
48,109
|
|
|
148,673
|
|
|
104,437
|
|
|
301,219
|
|
||||
Residential construction
|
97,189
|
|
|
2,839
|
|
|
9,088
|
|
|
109,116
|
|
||||
Consumer and other
|
4,325
|
|
|
5,993
|
|
|
2
|
|
|
10,320
|
|
||||
Total loans
|
$
|
605,124
|
|
|
$
|
1,224,126
|
|
|
$
|
441,626
|
|
|
$
|
2,270,876
|
|
|
|
|
|
|
|
|
|
||||||||
Loans with predetermined (fixed) interest rates
|
$
|
363,029
|
|
|
$
|
1,119,854
|
|
|
$
|
263,847
|
|
|
$
|
1,746,730
|
|
Loans with floating interest rates
|
242,095
|
|
|
104,272
|
|
|
177,779
|
|
|
524,146
|
|
||||
Total loans
|
$
|
605,124
|
|
|
$
|
1,224,126
|
|
|
$
|
441,626
|
|
|
$
|
2,270,876
|
|
|
As of December 31, 2016
|
||||||||||||||
|
Due in
One Year or Less |
|
Due After
One Year Through Five Years |
|
Due After
Five Years |
|
Total
|
||||||||
|
(Dollars in thousands)
|
||||||||||||||
Commercial and industrial
|
$
|
161,231
|
|
|
$
|
203,873
|
|
|
$
|
51,648
|
|
|
$
|
416,752
|
|
Mortgage warehouse
|
67,038
|
|
|
—
|
|
|
—
|
|
|
67,038
|
|
||||
Real estate:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Commercial real estate (including multi-family residential)
|
99,123
|
|
|
621,242
|
|
|
171,624
|
|
|
891,989
|
|
||||
Commercial real estate construction and land development
|
45,591
|
|
|
82,495
|
|
|
31,161
|
|
|
159,247
|
|
||||
1-4 family residential (including home equity)
|
45,558
|
|
|
115,965
|
|
|
85,464
|
|
|
246,987
|
|
||||
Residential construction
|
88,864
|
|
|
7,259
|
|
|
2,534
|
|
|
98,657
|
|
||||
Consumer and other
|
4,742
|
|
|
6,164
|
|
|
59
|
|
|
10,965
|
|
||||
Total loans
|
$
|
512,147
|
|
|
$
|
1,036,998
|
|
|
$
|
342,490
|
|
|
$
|
1,891,635
|
|
|
|
|
|
|
|
|
|
||||||||
Loans with predetermined (fixed) interest rates
|
$
|
338,077
|
|
|
$
|
905,697
|
|
|
$
|
189,284
|
|
|
$
|
1,433,058
|
|
Loans with floating interest rates
|
174,070
|
|
|
131,301
|
|
|
153,206
|
|
|
458,577
|
|
||||
Total loans
|
$
|
512,147
|
|
|
$
|
1,036,998
|
|
|
$
|
342,490
|
|
|
$
|
1,891,635
|
|
|
As of December 31,
|
||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||
Nonaccrual loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Loans held for sale
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
209
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Commercial and industrial
|
6,437
|
|
|
3,896
|
|
|
2,664
|
|
|
1,527
|
|
|
2,290
|
|
|||||
Mortgage warehouse
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Commercial real estate (including multi-family residential)
|
6,110
|
|
|
11,663
|
|
|
2,006
|
|
|
1,653
|
|
|
—
|
|
|||||
Commercial real estate construction and land development
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
1-4 family residential (including home equity)
|
781
|
|
|
217
|
|
|
239
|
|
|
—
|
|
|
83
|
|
|||||
Residential construction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Consumer and other
|
—
|
|
|
12
|
|
|
66
|
|
|
4
|
|
|
199
|
|
|||||
Total nonaccrual loans
|
13,328
|
|
|
15,788
|
|
|
5,184
|
|
|
3,184
|
|
|
2,572
|
|
|||||
Accruing loans 90 or more days past due
|
—
|
|
|
911
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total nonperforming loans
|
13,328
|
|
|
16,699
|
|
|
5,184
|
|
|
3,184
|
|
|
2,572
|
|
|||||
Other real estate
|
365
|
|
|
1,503
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Repossessed assets
|
205
|
|
|
286
|
|
|
131
|
|
|
—
|
|
|
332
|
|
|||||
Total nonperforming assets
|
$
|
13,898
|
|
|
$
|
18,488
|
|
|
$
|
5,315
|
|
|
$
|
3,184
|
|
|
$
|
2,904
|
|
Restructured loans
(1)
|
$
|
17,526
|
|
|
$
|
4,831
|
|
|
$
|
491
|
|
|
$
|
—
|
|
|
$
|
1,503
|
|
Nonperforming assets to total assets
(2)
|
0.49
|
%
|
|
0.75
|
%
|
|
0.25
|
%
|
|
0.25
|
%
|
|
0.25
|
%
|
|||||
Nonperforming loans to total loans
(3)
|
0.59
|
%
|
|
0.88
|
%
|
|
0.31
|
%
|
|
0.32
|
%
|
|
0.31
|
%
|
(1)
|
Restructured loans represent the balance at the end of the respective period for those performing loans modified in a troubled debt restructuring that are not already presented as a nonperforming loan.
|
(2)
|
Nonperforming assets include nonaccrual loans, loans past due 90 days or more and still accruing interest, repossessed assets and other real estate.
|
(3)
|
Nonperforming loans include nonaccrual loans and loans past due 90 days or more and still accruing interest.
|
|
As of and for the Years Ended December 31,
|
||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||
Average loans outstanding
|
$
|
2,081,370
|
|
|
$
|
1,755,319
|
|
|
$
|
1,525,325
|
|
|
$
|
917,218
|
|
|
$
|
649,362
|
|
Gross loans outstanding at end of period
|
2,270,876
|
|
|
1,891,635
|
|
|
1,681,052
|
|
|
1,002,054
|
|
|
836,694
|
|
|||||
Allowance for loan losses at beginning of period
|
17,911
|
|
|
13,098
|
|
|
8,246
|
|
|
6,655
|
|
|
6,539
|
|
|||||
Provision for loan losses
|
13,188
|
|
|
5,469
|
|
|
5,792
|
|
|
2,150
|
|
|
240
|
|
|||||
Charge-offs:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Commercial and industrial loans
|
(7,673
|
)
|
|
(722
|
)
|
|
(935
|
)
|
|
(567
|
)
|
|
(369
|
)
|
|||||
Mortgage warehouse
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Commercial real estate (including multi-family residential)
|
(124
|
)
|
|
(129
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Commercial real estate construction and land development
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
1-4 family residential (including home equity)
|
—
|
|
|
—
|
|
|
(40
|
)
|
|
—
|
|
|
—
|
|
|||||
Residential construction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Consumer and other
|
(196
|
)
|
|
(49
|
)
|
|
(65
|
)
|
|
(40
|
)
|
|
(19
|
)
|
|||||
Total charge-offs for all loan types
|
(7,993
|
)
|
|
(900
|
)
|
|
(1,040
|
)
|
|
(607
|
)
|
|
(388
|
)
|
|||||
Recoveries:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Commercial and industrial loans
|
516
|
|
|
186
|
|
|
52
|
|
|
32
|
|
|
33
|
|
|||||
Mortgage warehouse
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Commercial real estate (including multi-family residential)
|
3
|
|
|
43
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Commercial real estate construction and land development
|
10
|
|
|
—
|
|
|
18
|
|
|
—
|
|
|
—
|
|
|||||
1-4 family residential (including home equity)
|
10
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
228
|
|
|||||
Residential construction
|
—
|
|
|
—
|
|
|
24
|
|
|
—
|
|
|
1
|
|
|||||
Consumer and other
|
4
|
|
|
5
|
|
|
6
|
|
|
16
|
|
|
2
|
|
|||||
Total recoveries for all loan types
|
543
|
|
|
244
|
|
|
100
|
|
|
48
|
|
|
264
|
|
|||||
Net charge-offs
|
(7,450
|
)
|
|
(656
|
)
|
|
(940
|
)
|
|
(559
|
)
|
|
(124
|
)
|
|||||
Allowance for loan losses at end of period
|
$
|
23,649
|
|
|
$
|
17,911
|
|
|
$
|
13,098
|
|
|
$
|
8,246
|
|
|
$
|
6,655
|
|
Allowance for loan losses to total loans
|
1.04
|
%
|
|
0.95
|
%
|
|
0.78
|
%
|
|
0.82
|
%
|
|
0.80
|
%
|
|||||
Net charge-offs to average loans
|
0.36
|
%
|
|
0.04
|
%
|
|
0.06
|
%
|
|
0.06
|
%
|
|
0.02
|
%
|
|||||
Allowance to nonperforming loans
|
177.44
|
%
|
|
107.26
|
%
|
|
252.66
|
%
|
|
258.98
|
%
|
|
258.75
|
%
|
•
|
for commercial and industrial loans, the operating results of the commercial, industrial or professional enterprise, the borrower’s business, professional and financial ability and expertise, the specific risks and volatility of income and operating results typical for businesses in that category and the value, nature and marketability of collateral;
|
•
|
for commercial real estate (including multi-family residential) loans, the debt service coverage ratio (income from the property in excess of operating expenses compared to loan payment requirements), operating results of the owner in the case of owner-occupied properties, the loan to value ratio, the age and condition of the collateral and the volatility of income, property value and future operating results typical of properties of that type;
|
•
|
for commercial real estate construction and land development and residential construction loans, the perceived feasibility of the project including the ability to sell developed lots or improvements constructed for resale or the ability to lease property constructed for lease, the quality and nature of contracts for presale or prelease, if any, experience and ability of the developer and loan to value ratio;
|
•
|
for 1-4 family residential (including home equity) loans, the borrower’s ability to repay the loan, including a consideration of the debt to income ratio and employment and income stability, the loan to value ratio, and the age, condition and marketability of collateral; and
|
•
|
for consumer and other loans, the individual borrower’s income, current debt level, past credit history and the value of any available collateral.
|
•
|
Loans classified as “watch” loans may still be of high quality, but have an element of risk added to the credit such as declining payment history, deteriorating financial position of the borrower or a decrease in collateral value.
|
•
|
Loans classified as “special mention” have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of our credit position at some future date. They are characterized by the distinct possibility that we will sustain some loss if the deficiencies are not corrected.
|
•
|
Loans classified as “substandard” have well-defined weaknesses on a continuing basis and are inadequately protected by the current net worth and paying capacity of the borrower, impaired or declining collateral values, or a continuing downturn in their industry which is reducing their profits to below zero and having a significantly negative impact on their cash flow. Such loans are characterized by the distinct possibility that we will sustain some loss if the deficiencies are not corrected.
|
•
|
Loans classified as “doubtful” have all the weaknesses inherent in those classified as substandard with the added characteristic that the weaknesses make collection or liquidation in full on the basis of currently existing facts, conditions and values highly questionable and improbable.
|
|
As of December 31,
|
|||||||||||||||||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|||||||||||||||||||||||||
|
Amount
|
|
Percent of Loans to Total Loans
|
|
Amount
|
|
Percent of Loans to Total Loans
|
|
Amount
|
|
Percent of Loans to Total Loans
|
|
Amount
|
|
Percent of Loans to Total Loans
|
|
Amount
|
|
Percent of Loans to Total Loans
|
|||||||||||||||
|
(Dollars in thousands)
|
|||||||||||||||||||||||||||||||||
Balance of allowance for loan losses applicable to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial and industrial loans
|
$
|
7,694
|
|
|
20.1
|
%
|
|
$
|
5,059
|
|
|
22.0
|
%
|
|
$
|
3,644
|
|
|
23.6
|
%
|
|
$
|
2,334
|
|
|
24.2
|
%
|
|
$
|
2,729
|
|
|
27.2
|
%
|
Mortgage Warehouse
|
—
|
|
|
3.1
|
%
|
|
—
|
|
|
3.5
|
%
|
|
—
|
|
|
3.5
|
%
|
|
—
|
|
|
2.8
|
%
|
|
—
|
|
|
0.0
|
%
|
|||||
Real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Commercial real estate (including multi-family residential)
|
10,253
|
|
|
47.5
|
%
|
|
8,950
|
|
|
47.2
|
%
|
|
5,914
|
|
|
45.0
|
%
|
|
3,799
|
|
|
42.9
|
%
|
|
2,175
|
|
|
47.9
|
%
|
|||||
Commercial real estate construction and land development
|
2,525
|
|
|
10.7
|
%
|
|
1,217
|
|
|
8.4
|
%
|
|
1,221
|
|
|
9.2
|
%
|
|
578
|
|
|
8.5
|
%
|
|
357
|
|
|
8.6
|
%
|
|||||
1-4 family residential (including home equity)
|
2,140
|
|
|
13.3
|
%
|
|
1,876
|
|
|
13.1
|
%
|
|
1,432
|
|
|
12.3
|
%
|
|
1,008
|
|
|
13.5
|
%
|
|
558
|
|
|
10.7
|
%
|
|||||
Residential construction
|
942
|
|
|
4.8
|
%
|
|
748
|
|
|
5.2
|
%
|
|
820
|
|
|
5.6
|
%
|
|
475
|
|
|
7.2
|
%
|
|
598
|
|
|
4.6
|
%
|
|||||
Consumer and other
|
95
|
|
|
0.5
|
%
|
|
61
|
|
|
0.6
|
%
|
|
67
|
|
|
0.8
|
%
|
|
52
|
|
|
0.9
|
%
|
|
238
|
|
|
1.0
|
%
|
|||||
Total allowance for loan losses
|
$
|
23,649
|
|
|
100.0
|
%
|
|
$
|
17,911
|
|
|
100.0
|
%
|
|
$
|
13,098
|
|
|
100.0
|
%
|
|
$
|
8,246
|
|
|
100.0
|
%
|
|
$
|
6,655
|
|
|
100.0
|
%
|
|
December 31, 2017
|
||||||||||||||
|
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Fair
Value
|
||||||||
|
(Dollars in thousands)
|
||||||||||||||
Available for Sale
|
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. Government and agency securities
|
$
|
8,507
|
|
|
$
|
232
|
|
|
$
|
(24
|
)
|
|
$
|
8,715
|
|
Municipal securities
|
222,330
|
|
|
2,470
|
|
|
(1,842
|
)
|
|
222,958
|
|
||||
Agency mortgage-backed pass-through securities
|
32,014
|
|
|
159
|
|
|
(361
|
)
|
|
31,812
|
|
||||
Corporate bonds
|
46,247
|
|
|
62
|
|
|
(179
|
)
|
|
46,130
|
|
||||
Total
|
$
|
309,098
|
|
|
$
|
2,923
|
|
|
$
|
(2,406
|
)
|
|
$
|
309,615
|
|
|
December 31, 2016
|
||||||||||||||
|
Amortized
Cost |
|
Gross
Unrealized Gains |
|
Gross
Unrealized Losses |
|
Fair
Value |
||||||||
|
(Dollars in thousands)
|
||||||||||||||
Available for Sale
|
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. Government and agency securities
|
$
|
5,883
|
|
|
$
|
266
|
|
|
$
|
—
|
|
|
$
|
6,149
|
|
Municipal securities
|
242,501
|
|
|
956
|
|
|
(5,655
|
)
|
|
237,802
|
|
||||
Agency mortgage-backed pass-through securities
|
27,496
|
|
|
265
|
|
|
(437
|
)
|
|
27,324
|
|
||||
Corporate bonds
|
45,271
|
|
|
77
|
|
|
(168
|
)
|
|
45,180
|
|
||||
Total
|
$
|
321,151
|
|
|
$
|
1,564
|
|
|
$
|
(6,260
|
)
|
|
$
|
316,455
|
|
|
December 31, 2017
|
|||||||||||||||||||||||||||||||||
|
Within One
Year
|
|
After One Year
but
Within Five Years
|
|
After Five Years but Within Ten Years
|
|
After Ten
Years
|
|
Total
|
|||||||||||||||||||||||||
|
Amount
|
|
Yield
|
|
Amount
|
|
Yield
|
|
Amount
|
|
Yield
|
|
Amount
|
|
Yield
|
|
Total
|
|
Yield
|
|||||||||||||||
|
(Dollars in thousands)
|
|||||||||||||||||||||||||||||||||
Available for Sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
U.S. government and agency securities
|
$
|
2,018
|
|
|
1.46
|
%
|
|
$
|
2,516
|
|
|
3.33
|
%
|
|
$
|
1,396
|
|
|
3.44
|
%
|
|
$
|
2,577
|
|
|
2.75
|
%
|
|
$
|
8,507
|
|
|
2.73
|
%
|
Municipal securities
|
1,263
|
|
|
2.56
|
%
|
|
26,841
|
|
|
2.37
|
%
|
|
82,981
|
|
|
3.21
|
%
|
|
111,245
|
|
|
4.48
|
%
|
|
222,330
|
|
|
3.74
|
%
|
|||||
Agency mortgage-backed pass-through securities
|
—
|
|
|
0.00
|
%
|
|
—
|
|
|
0.00
|
%
|
|
5,074
|
|
|
2.29
|
%
|
|
26,940
|
|
|
2.90
|
%
|
|
32,014
|
|
|
2.81
|
%
|
|||||
Corporate bonds
|
7,552
|
|
|
2.19
|
%
|
|
29,538
|
|
|
2.45
|
%
|
|
9,157
|
|
|
2.99
|
%
|
|
—
|
|
|
0.00
|
%
|
|
46,247
|
|
|
2.51
|
%
|
|||||
Total
|
$
|
10,833
|
|
|
2.10
|
%
|
|
$
|
58,895
|
|
|
2.45
|
%
|
|
$
|
98,608
|
|
|
3.14
|
%
|
|
$
|
140,762
|
|
|
4.15
|
%
|
|
$
|
309,098
|
|
|
3.43
|
%
|
|
December 31, 2016
|
|||||||||||||||||||||||||||||||||
|
Within One
Year
|
|
After One Year
but
Within Five Years
|
|
After Five Years but Within Ten Years
|
|
After Ten
Years
|
|
Total
|
|||||||||||||||||||||||||
|
Amount
|
|
Yield
|
|
Amount
|
|
Yield
|
|
Amount
|
|
Yield
|
|
Amount
|
|
Yield
|
|
Total
|
|
Yield
|
|||||||||||||||
|
(Dollars in thousands)
|
|||||||||||||||||||||||||||||||||
Available for Sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
U.S. government and agency securities
|
$
|
—
|
|
|
0.00
|
%
|
|
$
|
2,014
|
|
|
1.46
|
%
|
|
$
|
3,869
|
|
|
3.37
|
%
|
|
$
|
—
|
|
|
0.00
|
%
|
|
$
|
5,883
|
|
|
2.71
|
%
|
Municipal securities
|
2,738
|
|
|
1.76
|
%
|
|
27,216
|
|
|
2.50
|
%
|
|
83,682
|
|
|
3.15
|
%
|
|
128,865
|
|
|
4.91
|
%
|
|
242,501
|
|
|
4.00
|
%
|
|||||
Agency mortgage-backed pass-through securities
|
—
|
|
|
0.00
|
%
|
|
—
|
|
|
0.00
|
%
|
|
4,856
|
|
|
2.12
|
%
|
|
22,640
|
|
|
2.55
|
%
|
|
27,496
|
|
|
2.48
|
%
|
|||||
Corporate bonds
|
—
|
|
|
0.00
|
%
|
|
45,271
|
|
|
2.36
|
%
|
|
—
|
|
|
0.00
|
%
|
|
—
|
|
|
0.00
|
%
|
|
45,271
|
|
|
2.36
|
%
|
|||||
Total
|
$
|
2,738
|
|
|
1.76
|
%
|
|
$
|
74,501
|
|
|
2.39
|
%
|
|
$
|
92,407
|
|
|
3.11
|
%
|
|
$
|
151,505
|
|
|
4.56
|
%
|
|
$
|
321,151
|
|
|
3.61
|
%
|
|
Years Ended December 31,
|
|||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||
|
Average
Balance
|
|
Average
Rate
|
|
Average
Balance
|
|
Average
Rate
|
|
Average
Balance
|
|
Average
Rate
|
|||||||||
|
(Dollars in thousands)
|
|||||||||||||||||||
Interest-bearing demand
|
$
|
156,527
|
|
|
0.38
|
%
|
|
$
|
104,212
|
|
|
0.32
|
%
|
|
$
|
100,139
|
|
|
0.16
|
%
|
Money market and savings
|
536,415
|
|
|
0.48
|
%
|
|
465,403
|
|
|
0.45
|
%
|
|
429,153
|
|
|
0.43
|
%
|
|||
Certificates and other time
|
748,086
|
|
|
1.21
|
%
|
|
648,075
|
|
|
1.09
|
%
|
|
559,247
|
|
|
0.94
|
%
|
|||
Total interest-bearing deposits
|
1,441,028
|
|
|
0.85
|
%
|
|
1,217,690
|
|
|
0.78
|
%
|
|
1,088,539
|
|
|
0.67
|
%
|
|||
Noninterest-bearing deposits
|
672,101
|
|
|
—
|
|
|
620,701
|
|
|
—
|
|
|
554,704
|
|
|
—
|
|
|||
Total deposits
|
$
|
2,113,129
|
|
|
0.58
|
%
|
|
$
|
1,838,391
|
|
|
0.52
|
%
|
|
$
|
1,643,243
|
|
|
0.44
|
%
|
|
As of December 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(Dollars in thousands)
|
||||||
Three months or less
|
$
|
144,741
|
|
|
$
|
143,043
|
|
Over three months through six months
|
108,535
|
|
|
79,644
|
|
||
Over six months through 12 months
|
175,588
|
|
|
115,095
|
|
||
Over 12 months through three years
|
131,244
|
|
|
185,624
|
|
||
Over three years
|
87,895
|
|
|
42,713
|
|
||
Total
|
$
|
648,003
|
|
|
$
|
566,119
|
|
|
As of December 31, 2017
|
||||||||||||||||||
|
1 year or less
|
|
More than 1
year but less
than 3 years
|
|
3 years or
more but less
than 5 years
|
|
5 years
or more
|
|
Total
|
||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||
Bank loan
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
569
|
|
|
$
|
569
|
|
Operating leases
|
1,806
|
|
|
1,030
|
|
|
1,950
|
|
|
4,673
|
|
|
9,459
|
|
|||||
Total
|
$
|
1,806
|
|
|
$
|
1,030
|
|
|
$
|
1,950
|
|
|
$
|
5,242
|
|
|
$
|
10,028
|
|
|
As of December 31, 2016
|
||||||||||||||||||
|
1 year or less
|
|
More than 1
year but less than 3 years |
|
3 years or
more but less than 5 years |
|
5 years
or more |
|
Total
|
||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||
Bank loan
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
569
|
|
|
$
|
569
|
|
Operating leases
|
2,654
|
|
|
1,820
|
|
|
2,087
|
|
|
4,513
|
|
|
11,074
|
|
|||||
Total
|
$
|
2,654
|
|
|
$
|
1,820
|
|
|
$
|
2,087
|
|
|
$
|
5,082
|
|
|
$
|
11,643
|
|
|
As of December 31, 2017
|
||||||||||||||||||
|
1 year or less
|
|
More than 1
year but less
than 3 years
|
|
3 years or
more but less
than 5 years
|
|
5 years
or more
|
|
Total
|
||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||
Commitments to extend credit
|
$
|
349,678
|
|
|
$
|
48,048
|
|
|
$
|
30,731
|
|
|
$
|
191,583
|
|
|
$
|
620,040
|
|
Standby letters of credit
|
16,895
|
|
|
275
|
|
|
—
|
|
|
—
|
|
|
17,170
|
|
|||||
Total
|
$
|
366,573
|
|
|
$
|
48,323
|
|
|
$
|
30,731
|
|
|
$
|
191,583
|
|
|
$
|
637,210
|
|
|
For the Years Ended December 31,
|
|||||||
|
2017
|
|
2016
|
|
2015
|
|||
Sources of Funds:
|
|
|
|
|
|
|
|
|
Deposits:
|
|
|
|
|
|
|
|
|
Noninterest-bearing
|
24.9
|
%
|
|
26.5
|
%
|
|
28.6
|
%
|
Interest-bearing
|
53.4
|
%
|
|
52.0
|
%
|
|
56.2
|
%
|
Borrowed funds
|
10.0
|
%
|
|
9.0
|
%
|
|
3.5
|
%
|
Subordinated debt
|
0.4
|
%
|
|
0.4
|
%
|
|
0.5
|
%
|
Other liabilities
|
0.3
|
%
|
|
0.4
|
%
|
|
0.4
|
%
|
Shareholders’ equity
|
11.0
|
%
|
|
11.7
|
%
|
|
10.8
|
%
|
Total
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
|
|
|
|
|
|||
Uses of Funds:
|
|
|
|
|
|
|||
Loans
|
77.1
|
%
|
|
75.1
|
%
|
|
78.7
|
%
|
Securities
|
12.0
|
%
|
|
11.6
|
%
|
|
7.0
|
%
|
Deposits in other financial institutions
|
1.9
|
%
|
|
3.7
|
%
|
|
3.8
|
%
|
Noninterest-earning assets
|
9.0
|
%
|
|
9.6
|
%
|
|
10.5
|
%
|
Total
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
|
|
|
|
|
|||
Average noninterest-bearing deposits to average deposits
|
31.8
|
%
|
|
33.8
|
%
|
|
33.8
|
%
|
Average loans to average deposits
|
98.5
|
%
|
|
95.5
|
%
|
|
92.8
|
%
|
|
|
Actual Ratio
|
|
Minimum Required for Capital Adequacy Purposes
|
|
Minimum Required Plus Capital Conservation Buffer
|
|
To Be Categorized as Well Capitalized Under Prompt Corrective Action Provisions
|
The Company
|
|
|
|
|
|
|
|
|
Total capital (to risk weighted assets)
|
|
13.43%
|
|
8.00%
|
|
9.250%
|
|
N/A
|
Common Equity Tier 1 Capital
|
|
10.54%
|
|
4.50%
|
|
5.750%
|
|
N/A
|
Tier 1 capital (to risk weighted assets)
|
|
10.92%
|
|
6.00%
|
|
7.250%
|
|
N/A
|
Tier 1 capital (to average assets)
|
|
9.84%
|
|
4.00%
|
|
4.000%
|
|
N/A
|
|
|
|
|
|
|
|
|
|
The Bank
|
|
|
|
|
|
|
|
|
Total capital (to risk weighted assets)
|
|
13.24%
|
|
8.00%
|
|
9.250%
|
|
10.00%
|
Common Equity Tier 1 Capital
|
|
10.72%
|
|
4.50%
|
|
5.750%
|
|
6.50%
|
Tier 1 capital (to risk weighted assets)
|
|
10.72%
|
|
6.00%
|
|
7.250%
|
|
8.00%
|
Tier 1 capital (to average assets)
|
|
9.67%
|
|
4.00%
|
|
4.000%
|
|
5.00%
|
|
|
Percent Change in Net Interest Income
|
|
Percent Change in Economic Value of Equity
|
||||
Change in Interest
Rates (Basis Points)
|
|
As of December 31, 2017
|
|
As of December 31, 2016
|
|
As of December 31, 2017
|
|
As of December 31, 2016
|
+300
|
|
(6.2)%
|
|
(3.3)%
|
|
(9.0)%
|
|
(7.4)%
|
+200
|
|
(4.1)%
|
|
(2.3)%
|
|
(5.4)%
|
|
(4.7)%
|
+100
|
|
(2.2)%
|
|
(1.4)%
|
|
(2.3)%
|
|
(2.3)%
|
Base
|
|
0.0%
|
|
0.0%
|
|
0.0%
|
|
0.0%
|
-100
|
|
(1.9)%
|
|
1.8%
|
|
(1.9)%
|
|
1.1%
|
•
|
“Tangible Shareholders’ Equity”
is shareholders’ equity reduced by goodwill and core deposit intangibles, net of accumulated amortization.
|
•
|
“Tangible Book Value Per Share”
is a non-GAAP measure generally used by financial analysts and investment bankers to evaluate financial institutions. Tangible book value per share is defined as total shareholders’ equity reduced by goodwill and core deposit intangibles, net of accumulated amortization, divided by total shares outstanding. This measure is important to investors interested in changes from period to period in book value per share, exclusive of changes in
|
•
|
“Tangible Equity to Tangible Assets”
is a non-GAAP measure generally used by financial analysts and investment bankers to evaluate financial institutions. Tangible equity to tangible assets is defined as total shareholders’ equity reduced by goodwill and core deposit intangibles, net of accumulated amortization, divided by tangible assets, which are total assets reduced by goodwill and core deposit intangibles, net of accumulated amortization. This measure is important to investors interested in changes from period to period in equity and total assets, each exclusive of changes in intangible assets. For tangible equity to tangible assets, the most directly comparable financial measure calculated in accordance with GAAP is total shareholders’ equity to total assets. Goodwill and other intangible assets have the effect of increasing both total shareholders’ equity and assets while not increasing our tangible common equity or tangible assets.
|
|
As of and for the Years Ended December 31,
|
||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
|
(Dollars in thousands, except share and per share data)
|
||||||||||||||||||
Total shareholders' equity
|
$
|
306,865
|
|
|
$
|
279,817
|
|
|
$
|
258,490
|
|
|
$
|
131,778
|
|
|
$
|
109,736
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Goodwill and core deposit intangibles, net
|
42,663
|
|
|
43,444
|
|
|
44,619
|
|
|
12,891
|
|
|
13,044
|
|
|||||
Tangible shareholders' equity
|
$
|
264,202
|
|
|
$
|
236,373
|
|
|
$
|
213,871
|
|
|
$
|
118,887
|
|
|
$
|
96,692
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Shares outstanding at end of period
(1)
|
13,226,826
|
|
|
12,958,341
|
|
|
12,812,985
|
|
|
7,477,309
|
|
|
6,953,125
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Tangible book value per common share
|
$
|
19.97
|
|
|
$
|
18.24
|
|
|
$
|
16.69
|
|
|
$
|
15.90
|
|
|
$
|
13.91
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income attributable to common shareholders
|
$
|
17,632
|
|
|
$
|
22,851
|
|
|
$
|
15,227
|
|
|
$
|
9,005
|
|
|
$
|
6,839
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Average common shareholders' equity
|
297,627
|
|
|
273,211
|
|
|
204,935
|
|
|
116,460
|
|
|
75,787
|
|
|||||
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Average goodwill and other intangible assets, net
|
43,050
|
|
|
43,880
|
|
|
45,055
|
|
|
13,007
|
|
|
1,615
|
|
|||||
Average tangible common shareholders’ equity
|
$
|
254,577
|
|
|
$
|
229,331
|
|
|
$
|
159,880
|
|
|
$
|
103,453
|
|
|
$
|
74,172
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Return on average tangible common equity
|
6.93
|
%
|
|
9.96
|
%
|
|
9.52
|
%
|
|
8.70
|
%
|
|
9.22
|
%
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Total assets
|
$
|
2,860,231
|
|
|
$
|
2,450,948
|
|
|
$
|
2,084,579
|
|
|
$
|
1,280,008
|
|
|
$
|
1,164,759
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Goodwill and core deposit intangibles, net
|
42,663
|
|
|
43,444
|
|
|
44,619
|
|
|
12,891
|
|
|
13,044
|
|
|||||
Tangible assets
|
$
|
2,817,568
|
|
|
$
|
2,407,504
|
|
|
$
|
2,039,960
|
|
|
$
|
1,267,117
|
|
|
$
|
1,151,715
|
|
Tangible common equity to tangible assets
|
9.38
|
%
|
|
9.82
|
%
|
|
10.48
|
%
|
|
9.38
|
%
|
|
8.40
|
%
|
*
|
Filed with this Annual Report on Form 10-K.
|
**
|
Furnished with this Annual Report on Form 10-K.
|
|
ALLEGIANCE BANCSHARES, INC.
|
|
|
|
|
|
By:
|
/s/ George Martinez
|
|
|
George Martinez
|
|
|
Chairman and Chief Executive Officer
|
Signature
|
|
Positions
|
|
Date
|
|
|
|
|
|
/s/ George Martinez
|
|
Chairman and Chief Executive Officer
|
|
March 9, 2018
|
George Martinez
|
|
(Principal Executive Officer); Director
|
|
|
|
|
|
|
|
/s/ Steven F. Retzloff
|
|
President and Director
|
|
March 9, 2018
|
Steven F. Retzloff
|
|
|
|
|
|
|
|
|
|
/s/ Paul P. Egge
|
|
Chief Financial Officer
|
|
March 9, 2018
|
Paul P. Egge
|
|
(Principal Financial and Principal Accounting Officer)
|
|
|
|
|
|
|
|
/s/ Ramon A. Vitulli, III
|
|
Director
|
|
March 9, 2018
|
Ramon A. Vitulli, III
|
|
|
|
|
|
|
|
|
|
/s/ Daryl D. Bohls
|
|
Director
|
|
March 9, 2018
|
Daryl D. Bohls
|
|
|
|
|
|
|
|
|
|
/s/ John Beckworth
|
|
Director
|
|
March 9, 2018
|
John Beckworth
|
|
|
|
|
|
|
|
|
|
/s/ Matthew H. Hartzell
|
|
Director
|
|
March 9, 2018
|
Matthew H. Hartzell
|
|
|
|
|
|
|
|
|
|
/s/ Robert Ivany
|
|
Director
|
|
March 9, 2018
|
Robert Ivany
|
|
|
|
|
|
|
|
|
|
/s/ Umesh Jain
|
|
Director
|
|
March 9, 2018
|
Umesh Jain
|
|
|
|
|
|
|
|
|
|
/s/ Frances H. Jeter
|
|
Director
|
|
March 9, 2018
|
Frances H. Jeter
|
|
|
|
|
|
|
|
|
|
/s/ James J. Kearney
|
|
Director
|
|
March 9, 2018
|
James J. Kearney
|
|
|
|
|
Signature
|
|
Positions
|
|
Date
|
|
|
|
|
|
/s/ P. Michael Mann, M.D.
|
|
Director
|
|
March 9, 2018
|
P. Michael Mann, M.D.
|
|
|
|
|
|
|
|
|
|
/s/ David B. Moulton
|
|
Director
|
|
March 9, 2018
|
David B. Moulton
|
|
|
|
|
|
|
|
|
|
/s/ William S. Nichols, III
|
|
Director
|
|
March 9, 2018
|
William S. Nichols, III
|
|
|
|
|
|
|
|
|
|
/s/ Thomas A. Reiser
|
|
Director
|
|
March 9, 2018
|
Thomas A. Reiser
|
|
|
|
|
|
|
|
|
|
/s/ Raimundo Riojas E.
|
|
Director
|
|
March 9, 2018
|
Raimundo Riojas E.
|
|
|
|
|
|
|
|
|
|
/s/ Fred S. Robertson
|
|
Director
|
|
March 9, 2018
|
Fred S. Robertson
|
|
|
|
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(Dollars in thousands, except share data)
|
||||||
ASSETS
|
|
|
|
|
|
||
Cash and due from banks
|
$
|
133,124
|
|
|
$
|
94,073
|
|
Interest-bearing deposits at other financial institutions
|
48,979
|
|
|
48,025
|
|
||
Total cash and cash equivalents
|
182,103
|
|
|
142,098
|
|
||
Available for sale securities, at fair value
|
309,615
|
|
|
316,455
|
|
||
Loans held for investment
|
2,270,876
|
|
|
1,891,635
|
|
||
Less: allowance for loan losses
|
(23,649
|
)
|
|
(17,911
|
)
|
||
Loans, net
|
2,247,227
|
|
|
1,873,724
|
|
||
Accrued interest receivable
|
12,194
|
|
|
9,007
|
|
||
Premises and equipment, net
|
18,477
|
|
|
18,340
|
|
||
Other real estate owned
|
365
|
|
|
1,503
|
|
||
Federal Home Loan Bank stock
|
12,862
|
|
|
13,175
|
|
||
Bank owned life insurance
|
22,422
|
|
|
21,837
|
|
||
Goodwill
|
39,389
|
|
|
39,389
|
|
||
Core deposit intangibles, net
|
3,274
|
|
|
4,055
|
|
||
Other assets
|
12,303
|
|
|
11,365
|
|
||
TOTAL ASSETS
|
$
|
2,860,231
|
|
|
$
|
2,450,948
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
||
LIABILITIES:
|
|
|
|
|
|
||
Deposits:
|
|
|
|
|
|
||
Noninterest-bearing
|
$
|
683,110
|
|
|
$
|
593,751
|
|
Interest-bearing
|
|
|
|
|
|
||
Demand
|
215,499
|
|
|
114,772
|
|
||
Money market and savings
|
554,051
|
|
|
483,266
|
|
||
Certificates and other time
|
761,314
|
|
|
678,394
|
|
||
Total interest-bearing deposits
|
1,530,864
|
|
|
1,276,432
|
|
||
Total deposits
|
2,213,974
|
|
|
1,870,183
|
|
||
Accrued interest payable
|
610
|
|
|
285
|
|
||
Borrowed funds
|
282,569
|
|
|
285,569
|
|
||
Subordinated debt
|
48,659
|
|
|
9,196
|
|
||
Other liabilities
|
7,554
|
|
|
5,898
|
|
||
Total liabilities
|
2,553,366
|
|
|
2,171,131
|
|
||
COMMITMENTS AND CONTINGENCIES (See Note 15)
|
|
|
|
|
|
||
SHAREHOLDERS’ EQUITY:
|
|
|
|
|
|
||
Preferred stock, $1 par value; 1,000,000 shares authorized; there were no shares issued and outstanding of Series A or Series B, each has a $1,000 liquidation value
|
—
|
|
|
—
|
|
||
Common stock, $1 par value; 40,000,000 shares authorized; 13,226,826 shares issued and outstanding at December 31, 2017 and 12,958,341 shares issued and outstanding at December 31, 2016
|
13,227
|
|
|
12,958
|
|
||
Capital surplus
|
218,408
|
|
|
212,649
|
|
||
Retained earnings
|
74,894
|
|
|
57,262
|
|
||
Accumulated other comprehensive income (loss)
|
336
|
|
|
(3,052
|
)
|
||
Total shareholders’ equity
|
306,865
|
|
|
279,817
|
|
||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
|
$
|
2,860,231
|
|
|
$
|
2,450,948
|
|
|
For the Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
(Dollars in thousands, except per share data)
|
||||||||||
INTEREST INCOME:
|
|
|
|
|
|
|
|
|
|||
Loans, including fees
|
$
|
110,331
|
|
|
$
|
93,356
|
|
|
$
|
85,443
|
|
Securities:
|
|
|
|
|
|
|
|
|
|||
Taxable
|
2,111
|
|
|
1,807
|
|
|
1,122
|
|
|||
Tax-exempt
|
6,334
|
|
|
5,044
|
|
|
2,002
|
|
|||
Deposits in other financial institutions
|
662
|
|
|
571
|
|
|
239
|
|
|||
Total interest income
|
119,438
|
|
|
100,778
|
|
|
88,806
|
|
|||
|
|
|
|
|
|
||||||
INTEREST EXPENSE:
|
|
|
|
|
|
|
|
|
|||
Demand, money market and savings deposits
|
3,159
|
|
|
2,437
|
|
|
2,001
|
|
|||
Certificates and other time deposits
|
9,060
|
|
|
7,044
|
|
|
5,272
|
|
|||
Borrowed funds
|
2,922
|
|
|
945
|
|
|
789
|
|
|||
Subordinated debt
|
629
|
|
|
488
|
|
|
578
|
|
|||
Total interest expense
|
15,770
|
|
|
10,914
|
|
|
8,640
|
|
|||
|
|
|
|
|
|
||||||
NET INTEREST INCOME
|
103,668
|
|
|
89,864
|
|
|
80,166
|
|
|||
Provision for loan losses
|
13,188
|
|
|
5,469
|
|
|
5,792
|
|
|||
Net interest income after provision for loan losses
|
90,480
|
|
|
84,395
|
|
|
74,374
|
|
|||
NONINTEREST INCOME:
|
|
|
|
|
|
|
|
|
|||
Nonsufficient funds fees
|
685
|
|
|
661
|
|
|
703
|
|
|||
Service charges on deposit accounts
|
783
|
|
|
677
|
|
|
680
|
|
|||
Gain on sale of branch assets
|
—
|
|
|
2,050
|
|
|
—
|
|
|||
Gain (loss) on sale of securities
|
18
|
|
|
30
|
|
|
(37
|
)
|
|||
Gain (loss) on sale of other real estate
|
6
|
|
|
266
|
|
|
(5
|
)
|
|||
Gain on sale of loans
|
—
|
|
|
—
|
|
|
235
|
|
|||
Bank owned life insurance income
|
585
|
|
|
626
|
|
|
604
|
|
|||
Rebate from correspondent bank
|
1,327
|
|
|
650
|
|
|
254
|
|
|||
Other
|
2,457
|
|
|
2,308
|
|
|
1,558
|
|
|||
Total noninterest income
|
5,861
|
|
|
7,268
|
|
|
3,992
|
|
|||
NONINTEREST EXPENSE:
|
|
|
|
|
|
|
|
|
|||
Salaries and employee benefits
|
44,745
|
|
|
38,858
|
|
|
35,324
|
|
|||
Net occupancy and equipment
|
5,452
|
|
|
4,944
|
|
|
4,826
|
|
|||
Depreciation
|
1,637
|
|
|
1,627
|
|
|
1,614
|
|
|||
Data processing and software amortization
|
4,047
|
|
|
2,633
|
|
|
3,044
|
|
|||
Professional fees
|
2,926
|
|
|
2,234
|
|
|
1,671
|
|
|||
Regulatory assessments and FDIC insurance
|
2,273
|
|
|
1,581
|
|
|
1,346
|
|
|||
Core deposit intangibles amortization
|
781
|
|
|
785
|
|
|
830
|
|
|||
Communications
|
983
|
|
|
1,055
|
|
|
1,290
|
|
|||
Advertising
|
1,289
|
|
|
945
|
|
|
781
|
|
|||
Other
|
5,829
|
|
|
4,596
|
|
|
4,079
|
|
|||
Total noninterest expense
|
69,962
|
|
|
59,258
|
|
|
54,805
|
|
|||
INCOME BEFORE INCOME TAXES
|
26,379
|
|
|
32,405
|
|
|
23,561
|
|
|||
Provision for income taxes
|
8,747
|
|
|
9,554
|
|
|
7,775
|
|
|||
NET INCOME
|
17,632
|
|
|
22,851
|
|
|
15,786
|
|
|||
Preferred stock dividends
|
—
|
|
|
—
|
|
|
559
|
|
|||
NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS
|
$
|
17,632
|
|
|
$
|
22,851
|
|
|
$
|
15,227
|
|
|
|
|
|
|
|
||||||
EARNINGS PER COMMON SHARE:
|
|
|
|
|
|
|
|
|
|||
Basic
|
$
|
1.34
|
|
|
$
|
1.78
|
|
|
$
|
1.45
|
|
Diluted
|
$
|
1.31
|
|
|
$
|
1.75
|
|
|
$
|
1.43
|
|
|
For the Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
(Dollars in thousands)
|
||||||||||
Net income
|
$
|
17,632
|
|
|
$
|
22,851
|
|
|
$
|
15,786
|
|
Other comprehensive income (loss), before tax:
|
|
|
|
|
|
|
|
|
|||
Unrealized gain (loss) on securities:
|
|
|
|
|
|
|
|
|
|||
Change in unrealized holding gains (losses) on available for sale securities during the period
|
5,213
|
|
|
(7,799
|
)
|
|
2,234
|
|
|||
Reclassification of amount realized through the sale of securities
|
(18
|
)
|
|
(30
|
)
|
|
37
|
|
|||
Total other comprehensive income (loss)
|
5,195
|
|
|
(7,829
|
)
|
|
2,271
|
|
|||
Deferred tax (expense) benefit related to other comprehensive income
|
(1,807
|
)
|
|
2,760
|
|
|
(803
|
)
|
|||
Other comprehensive income (loss), net of tax
|
3,388
|
|
|
(5,069
|
)
|
|
1,468
|
|
|||
Comprehensive income
|
$
|
21,020
|
|
|
$
|
17,782
|
|
|
$
|
17,254
|
|
|
Preferred Stock
|
|
Common Stock
|
|
Capital
Surplus |
|
Retained
Earnings |
|
Accumulated
Other Comprehensive Income (Loss) |
|
Treasury Stock
|
|
Total
Shareholders’ Equity |
||||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|
|
|
|||||||||||||||||||||
|
(In thousands, except share data)
|
||||||||||||||||||||||||||||||||
BALANCE AT JANUARY 1, 2015
|
—
|
|
|
$
|
—
|
|
|
7,477,309
|
|
|
$
|
7,477
|
|
|
$
|
104,568
|
|
|
$
|
19,184
|
|
|
$
|
549
|
|
|
$
|
—
|
|
|
$
|
131,778
|
|
Net income
|
|
|
|
|
|
|
|
|
|
|
15,786
|
|
|
|
|
|
|
15,786
|
|
||||||||||||||
Other comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
|
1,468
|
|
|
|
|
1,468
|
|
||||||||||||||
Common stock issued in connection with the exercise of stock options, restricted stock awards
|
|
|
|
|
3,983
|
|
|
4
|
|
|
7
|
|
|
|
|
|
|
|
|
11
|
|
||||||||||||
Repurchase of treasury stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(52
|
)
|
|
(52
|
)
|
||||||||||||||
Issuance of common stock in private placement offering
|
|
|
|
|
4,884
|
|
|
5
|
|
|
103
|
|
|
|
|
|
|
14
|
|
|
122
|
|
|||||||||||
Issuance of common stock in initial public offering, net of offering expenses
|
|
|
|
|
2,990,000
|
|
|
2,990
|
|
|
54,148
|
|
|
|
|
|
|
|
|
57,138
|
|
||||||||||||
Common stock issued in connection with the acquisition of F&M Bancshares, Inc.
|
|
|
|
|
2,338,520
|
|
|
2,339
|
|
|
49,108
|
|
|
|
|
|
|
|
|
51,447
|
|
||||||||||||
Preferred stock issued in connection with the acquisition of F&M Bancshares, Inc.
|
11,550
|
|
|
11,550
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
11,550
|
|
|||||||||||||
Redemption of preferred stock
|
(11,550
|
)
|
|
(11,550
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(11,550
|
)
|
|||||||||||||
Preferred stock dividends
|
|
|
|
|
|
|
|
|
|
|
(559
|
)
|
|
|
|
|
|
(559
|
)
|
||||||||||||||
Stock based compensation expense
|
|
|
|
|
|
|
|
|
1,351
|
|
|
|
|
|
|
|
|
1,351
|
|
||||||||||||||
BALANCE AT DECEMBER 31, 2015
|
—
|
|
|
—
|
|
|
12,814,696
|
|
|
12,815
|
|
|
209,285
|
|
|
34,411
|
|
|
2,017
|
|
|
(38
|
)
|
|
258,490
|
|
|||||||
Net income
|
|
|
|
|
|
|
|
|
|
|
22,851
|
|
|
|
|
|
|
22,851
|
|
||||||||||||||
Other comprehensive loss
|
|
|
|
|
|
|
|
|
|
|
|
|
(5,069
|
)
|
|
|
|
(5,069
|
)
|
||||||||||||||
Common stock issued in connection with the exercise of stock options and restricted stock awards
|
|
|
|
|
143,645
|
|
|
143
|
|
|
1,863
|
|
|
|
|
|
|
|
|
2,006
|
|
||||||||||||
Issuance of treasury stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
38
|
|
|
38
|
|
||||||||||||||
Stock based compensation expense
|
|
|
|
|
|
|
|
|
1,501
|
|
|
|
|
|
|
|
|
1,501
|
|
||||||||||||||
BALANCE AT DECEMBER 31, 2016
|
—
|
|
|
—
|
|
|
12,958,341
|
|
|
12,958
|
|
|
212,649
|
|
|
57,262
|
|
|
(3,052
|
)
|
|
—
|
|
|
279,817
|
|
|||||||
Net income
|
|
|
|
|
|
|
|
|
|
|
17,632
|
|
|
|
|
|
|
17,632
|
|
||||||||||||||
Other comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
|
3,388
|
|
|
|
|
3,388
|
|
||||||||||||||
Common stock issued in connection with the exercise of stock options and restricted stock awards
|
|
|
|
|
268,485
|
|
|
269
|
|
|
3,979
|
|
|
|
|
|
|
|
|
4,248
|
|
||||||||||||
Stock based compensation expense
|
|
|
|
|
|
|
|
|
1,780
|
|
|
|
|
|
|
|
|
1,780
|
|
||||||||||||||
BALANCE AT DECEMBER 31, 2017
|
—
|
|
|
$
|
—
|
|
|
13,226,826
|
|
|
$
|
13,227
|
|
|
$
|
218,408
|
|
|
$
|
74,894
|
|
|
$
|
336
|
|
|
$
|
—
|
|
|
$
|
306,865
|
|
|
For the Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
(Dollars in thousands)
|
||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|||
Net income
|
$
|
17,632
|
|
|
$
|
22,851
|
|
|
$
|
15,786
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
|||
Depreciation and core deposit intangibles amortization
|
2,418
|
|
|
2,412
|
|
|
2,444
|
|
|||
Provision for loan losses
|
13,188
|
|
|
5,469
|
|
|
5,792
|
|
|||
(Gain) loss on the sale of securities
|
(18
|
)
|
|
(30
|
)
|
|
37
|
|
|||
Deferred income tax expense (benefit)
|
427
|
|
|
(1,608
|
)
|
|
(446
|
)
|
|||
Net amortization of premium on investments
|
3,427
|
|
|
2,785
|
|
|
1,209
|
|
|||
Excess tax benefit related to the exercise of stock options
|
(1,149
|
)
|
|
(371
|
)
|
|
(40
|
)
|
|||
Bank owned life insurance
|
(585
|
)
|
|
(626
|
)
|
|
(604
|
)
|
|||
Net accretion of premium on loans
|
(632
|
)
|
|
(1,487
|
)
|
|
(3,492
|
)
|
|||
Net amortization of discount on subordinated debentures
|
108
|
|
|
107
|
|
|
218
|
|
|||
Net amortization of discount on certificates of deposit
|
(3
|
)
|
|
(247
|
)
|
|
(739
|
)
|
|||
Net (gain) loss on sale or write down of premises, equipment and other real estate
|
—
|
|
|
(60
|
)
|
|
5
|
|
|||
Net gain on sale of branch assets
|
—
|
|
|
(2,050
|
)
|
|
—
|
|
|||
Net gain on sale of loans
|
—
|
|
|
—
|
|
|
(235
|
)
|
|||
Federal Home Loan Bank stock dividends
|
(273
|
)
|
|
(101
|
)
|
|
(2
|
)
|
|||
Stock based compensation expense
|
1,780
|
|
|
1,501
|
|
|
1,351
|
|
|||
Increase in accrued interest receivable and other assets
|
(6,018
|
)
|
|
(259
|
)
|
|
(1,366
|
)
|
|||
Increase (decrease) in accrued interest payable and other liabilities
|
3,130
|
|
|
(851
|
)
|
|
503
|
|
|||
Net cash provided by operating activities
|
33,432
|
|
|
27,435
|
|
|
20,421
|
|
|||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|||
Proceeds from maturities and principal paydowns of available for sale securities
|
2,007,842
|
|
|
2,566,082
|
|
|
2,226,000
|
|
|||
Proceeds from sales of available for sale securities
|
39,125
|
|
|
2,500
|
|
|
16,943
|
|
|||
Purchase of available for sale securities
|
(2,038,323
|
)
|
|
(2,730,524
|
)
|
|
(2,307,331
|
)
|
|||
Net change in total loans
|
(386,059
|
)
|
|
(229,286
|
)
|
|
(273,648
|
)
|
|||
Proceeds from sale of loans
|
—
|
|
|
—
|
|
|
2,074
|
|
|||
Purchase of bank premises and equipment
|
(2,133
|
)
|
|
(1,511
|
)
|
|
(1,939
|
)
|
|||
Proceeds from sale of bank premises, equipment and other real estate
|
1,138
|
|
|
—
|
|
|
—
|
|
|||
Purchase of bank owned life insurance
|
—
|
|
|
—
|
|
|
(10,000
|
)
|
|||
Net redemptions (purchases) of Federal Home Loan Bank stock
|
586
|
|
|
(10,505
|
)
|
|
(2,101
|
)
|
|||
Net cash paid for sale of branch assets
|
—
|
|
|
(5,250
|
)
|
|
—
|
|
|||
Net cash and cash equivalents acquired in the purchase of F&M Bancshares, Inc.
|
—
|
|
|
—
|
|
|
106,486
|
|
|||
Net cash used in investing activities
|
(377,824
|
)
|
|
(408,494
|
)
|
|
(243,516
|
)
|
|||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|||
Net increase (decrease) in noninterest-bearing deposits
|
89,359
|
|
|
(20,041
|
)
|
|
60,996
|
|
|||
Net increase in interest-bearing deposits
|
254,435
|
|
|
157,723
|
|
|
75,380
|
|
|||
Paydowns on borrowed funds
|
(3,000
|
)
|
|
(20,000
|
)
|
|
(45,500
|
)
|
|||
Proceeds from borrowed funds
|
—
|
|
|
255,000
|
|
|
68,000
|
|
|||
Proceeds from issuance of subordinated notes, net of issuance costs
|
39,355
|
|
|
—
|
|
|
—
|
|
|||
Preferred stock dividends
|
—
|
|
|
—
|
|
|
(559
|
)
|
|||
Redemption of preferred stock
|
—
|
|
|
—
|
|
|
(11,550
|
)
|
|||
Proceeds from initial public offering
|
—
|
|
|
—
|
|
|
57,138
|
|
|||
Proceeds from the issuance of common stock, stock option exercises, restricted stock awards and the ESPP
|
4,248
|
|
|
2,006
|
|
|
133
|
|
|||
Issuance (repurchase) of treasury stock
|
—
|
|
|
38
|
|
|
(52
|
)
|
|||
Net cash provided by financing activities
|
384,397
|
|
|
374,726
|
|
|
203,986
|
|
|||
NET CHANGE IN CASH AND CASH EQUIVALENTS
|
40,005
|
|
|
(6,333
|
)
|
|
(19,109
|
)
|
|||
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD
|
142,098
|
|
|
148,431
|
|
|
167,540
|
|
|||
CASH AND CASH EQUIVALENTS, END OF PERIOD
|
$
|
182,103
|
|
|
$
|
142,098
|
|
|
$
|
148,431
|
|
NONCASH ACTIVITIES:
|
|
|
|
|
|
|
|
|
|||
Acquired loans transferred to loans held for sale
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
33,409
|
|
Acquired premises and equipment and accrued interest receivable transferred to branch assets held for sale
|
—
|
|
|
—
|
|
|
1,662
|
|
|||
SUPPLEMENTAL INFORMATION:
|
|
|
|
|
|
|
|
|
|||
Income taxes paid
|
$
|
7,850
|
|
|
$
|
11,400
|
|
|
$
|
7,500
|
|
Interest paid
|
15,442
|
|
|
10,500
|
|
|
7,820
|
|
|||
See Note 2 regarding non-cash transactions included in the F&M Bancshares, Inc. acquisition
|
|
|
|
|
|
Fair value of consideration paid:
|
|
|
|
Common shares issued (2,338,520 shares)
|
$
|
51,447
|
|
Preferred shares issued (11,550 shares)
|
11,550
|
|
|
Cash consideration
|
642
|
|
|
Total consideration paid
|
$
|
63,639
|
|
|
|
|
|
Fair value of assets acquired:
|
|
|
|
Cash and cash equivalents
|
$
|
107,128
|
|
Investment securities
|
14,722
|
|
|
Loans, net
|
404,637
|
|
|
Premises and equipment
|
7,699
|
|
|
Core deposit intangibles
|
4,313
|
|
|
Other assets
|
15,896
|
|
|
Total assets acquired
|
$
|
554,395
|
|
|
|
|
|
Fair value of liabilities assumed:
|
|
|
|
Deposits
|
$
|
489,556
|
|
Subordinated debt
|
8,871
|
|
|
Borrowed funds
|
18,000
|
|
|
Other liabilities
|
2,574
|
|
|
Total liabilities assumed
|
519,001
|
|
|
Fair value of net assets acquired
|
$
|
35,394
|
|
Goodwill resulting from acquisition
|
$
|
28,245
|
|
|
Contractual Balance
|
|
Fair Value
|
|
Discount
|
||||||
|
(Dollars in thousands)
|
||||||||||
Commercial and industrial
|
$
|
96,891
|
|
|
$
|
95,256
|
|
|
$
|
(1,635
|
)
|
Real estate:
|
|
|
|
|
|
|
|
|
|||
Commercial real estate (including multi-family residential)
|
225,191
|
|
|
222,082
|
|
|
(3,109
|
)
|
|||
Commercial real estate construction and land development
|
40,787
|
|
|
40,094
|
|
|
(693
|
)
|
|||
1-4 family residential (including home equity)
|
35,897
|
|
|
35,488
|
|
|
(409
|
)
|
|||
Residential construction
|
6,467
|
|
|
6,395
|
|
|
(72
|
)
|
|||
Consumer and other
|
5,421
|
|
|
5,322
|
|
|
(99
|
)
|
|||
Total loans
|
$
|
410,654
|
|
|
$
|
404,637
|
|
|
$
|
(6,017
|
)
|
|
For the Years Ended December 31,
|
||||||
|
2015
|
|
2014
|
||||
|
(Dollars in thousands, except per share data)
|
||||||
Net interest income
|
$
|
77,598
|
|
|
$
|
71,664
|
|
Net income attributable to common shareholders
|
14,170
|
|
|
14,999
|
|
||
Basic earnings per common share
|
1.35
|
|
|
1.53
|
|
||
Diluted earnings per common share
|
1.33
|
|
|
1.51
|
|
|
Goodwill
|
|
Core Deposit
Intangibles |
||||
|
(Dollars in thousands)
|
||||||
Balance as of January 1, 2015
|
$
|
11,144
|
|
|
$
|
1,747
|
|
Acquisition of F&M Bancshares
|
28,245
|
|
|
4,313
|
|
||
Amortization
|
—
|
|
|
(830
|
)
|
||
Balance as of December 31, 2015
|
39,389
|
|
|
5,230
|
|
||
Sale of branch assets
|
—
|
|
|
(390
|
)
|
||
Amortization
|
—
|
|
|
(785
|
)
|
||
Balance as of December 31, 2016
|
39,389
|
|
|
4,055
|
|
||
Amortization
|
—
|
|
|
(781
|
)
|
||
Balance as of December 31, 2017
|
$
|
39,389
|
|
|
$
|
3,274
|
|
2018
|
$
|
781
|
|
2019
|
781
|
|
|
2020
|
744
|
|
|
2021
|
484
|
|
|
2022
|
484
|
|
|
Thereafter
|
—
|
|
|
Total
|
$
|
3,274
|
|
|
December 31, 2017
|
||||||||||||||
|
Amortized
Cost |
|
Gross
Unrealized Gains |
|
Gross
Unrealized Losses |
|
Fair
Value |
||||||||
|
(Dollars in thousands)
|
||||||||||||||
Available for Sale
|
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. Government and agency securities
|
$
|
8,507
|
|
|
$
|
232
|
|
|
$
|
(24
|
)
|
|
$
|
8,715
|
|
Municipal securities
|
222,330
|
|
|
2,470
|
|
|
(1,842
|
)
|
|
222,958
|
|
||||
Agency mortgage-backed pass-through securities
|
32,014
|
|
|
159
|
|
|
(361
|
)
|
|
31,812
|
|
||||
Corporate bonds
|
46,247
|
|
|
62
|
|
|
(179
|
)
|
|
46,130
|
|
||||
Total
|
$
|
309,098
|
|
|
$
|
2,923
|
|
|
$
|
(2,406
|
)
|
|
$
|
309,615
|
|
|
December 31, 2016
|
||||||||||||||
|
Amortized
Cost |
|
Gross
Unrealized Gains |
|
Gross
Unrealized Losses |
|
Fair
Value |
||||||||
|
(Dollars in thousands)
|
||||||||||||||
Available for Sale
|
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. Government and agency securities
|
$
|
5,883
|
|
|
$
|
266
|
|
|
$
|
—
|
|
|
$
|
6,149
|
|
Municipal securities
|
242,501
|
|
|
956
|
|
|
(5,655
|
)
|
|
237,802
|
|
||||
Agency mortgage-backed pass-through securities
|
27,496
|
|
|
265
|
|
|
(437
|
)
|
|
27,324
|
|
||||
Corporate bonds
|
45,271
|
|
|
77
|
|
|
(168
|
)
|
|
45,180
|
|
||||
Total
|
$
|
321,151
|
|
|
$
|
1,564
|
|
|
$
|
(6,260
|
)
|
|
$
|
316,455
|
|
|
Amortized
Cost |
|
Fair
Value |
||||
|
(Dollars in thousands)
|
||||||
Due in one year or less
|
$
|
10,834
|
|
|
$
|
10,837
|
|
Due after one year through five years
|
58,894
|
|
|
58,832
|
|
||
Due after five years through ten years
|
93,535
|
|
|
93,673
|
|
||
Due after ten years
|
113,821
|
|
|
114,461
|
|
||
Subtotal
|
277,084
|
|
|
277,803
|
|
||
Agency mortgage-backed pass through securities
|
32,014
|
|
|
31,812
|
|
||
Total
|
$
|
309,098
|
|
|
$
|
309,615
|
|
|
December 31, 2017
|
||||||||||||||||||||||
|
Less than 12 Months
|
|
More than 12 Months
|
|
Total
|
||||||||||||||||||
|
Estimated
Fair Value |
|
Unrealized
Losses |
|
Estimated
Fair Value |
|
Unrealized
Losses |
|
Estimated
Fair Value |
|
Unrealized
Losses |
||||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||||||
Available for Sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
U.S. Government and agency securities
|
$
|
3,110
|
|
|
$
|
(9
|
)
|
|
$
|
595
|
|
|
$
|
(15
|
)
|
|
$
|
3,705
|
|
|
$
|
(24
|
)
|
Municipal securities
|
42,249
|
|
|
(517
|
)
|
|
56,483
|
|
|
(1,325
|
)
|
|
98,732
|
|
|
(1,842
|
)
|
||||||
Agency mortgage-backed pass-through securities
|
13,238
|
|
|
(105
|
)
|
|
8,921
|
|
|
(256
|
)
|
|
22,159
|
|
|
(361
|
)
|
||||||
Corporate bonds
|
30,203
|
|
|
(179
|
)
|
|
—
|
|
|
—
|
|
|
30,203
|
|
|
(179
|
)
|
||||||
Total
|
$
|
88,800
|
|
|
$
|
(810
|
)
|
|
$
|
65,999
|
|
|
$
|
(1,596
|
)
|
|
$
|
154,799
|
|
|
$
|
(2,406
|
)
|
|
December 31, 2016
|
||||||||||||||||||||||
|
Less than 12 Months
|
|
More than 12 Months
|
|
Total
|
||||||||||||||||||
|
Estimated
Fair Value |
|
Unrealized
Losses |
|
Estimated
Fair Value |
|
Unrealized
Losses |
|
Estimated
Fair Value |
|
Unrealized
Losses |
||||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||||||
Available for Sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
U.S. Government and agency securities
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Municipal securities
|
178,876
|
|
|
(5,655
|
)
|
|
—
|
|
|
—
|
|
|
178,876
|
|
|
(5,655
|
)
|
||||||
Agency mortgage-backed pass-through securities
|
12,520
|
|
|
(347
|
)
|
|
2,803
|
|
|
(90
|
)
|
|
15,323
|
|
|
(437
|
)
|
||||||
Corporate bonds
|
24,629
|
|
|
(168
|
)
|
|
—
|
|
|
—
|
|
|
24,629
|
|
|
(168
|
)
|
||||||
Total
|
$
|
216,025
|
|
|
$
|
(6,170
|
)
|
|
$
|
2,803
|
|
|
$
|
(90
|
)
|
|
$
|
218,828
|
|
|
$
|
(6,260
|
)
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(Dollars in thousands)
|
||||||
Commercial and industrial
|
$
|
457,129
|
|
|
$
|
416,752
|
|
Mortgage warehouse
(1)
|
69,456
|
|
|
67,038
|
|
||
Real estate:
|
|
|
|
|
|
||
Commercial real estate (including multi-family residential)
|
1,080,247
|
|
|
891,989
|
|
||
Commercial real estate construction and land development
|
243,389
|
|
|
159,247
|
|
||
1-4 family residential (including home equity)
|
301,219
|
|
|
246,987
|
|
||
Residential construction
|
109,116
|
|
|
98,657
|
|
||
Consumer and other
|
10,320
|
|
|
10,965
|
|
||
Total loans
|
2,270,876
|
|
|
1,891,635
|
|
||
Allowance for loan losses
|
(23,649
|
)
|
|
(17,911
|
)
|
||
Loans, net
|
$
|
2,247,227
|
|
|
$
|
1,873,724
|
|
(1)
|
Mortgage warehouse loans are to unaffiliated mortgage loan originators collateralized by mortgage promissory notes which are segregated in the Company’s mortgage warehouse portfolio. These promissory notes originated by the Company’s mortgage warehouse customers carry terms and conditions as would be expected in the competitive permanent mortgage market and serve as collateral under a traditional mortgage warehouse arrangement whereby such promissory notes are warehoused under a revolving credit facility to allow for the end investor (or purchaser) of the note to receive a complete loan package and remit funds to the bank. The maturity of each revolving line of credit facility is normally less than
24
months, while the promissory notes that are warehoused under such facilities may have a much shorter length of time outstanding. For mortgage promissory notes secured by residential property, the warehouse time is normally
10
to
20
days. For mortgage promissory notes secured by commercial property, the warehouse time is normally
40
to
50
days. The funded balance of the mortgage warehouse portfolio can have significant fluctuation based upon market demand for the product, level of home sales and refinancing activity, market interest rates and velocity of end investor processing times.
|
|
2017
|
||
|
(Dollars in thousands)
|
||
Beginning balance on January 1
|
$
|
3,943
|
|
New loans and reclassified related loans
|
805
|
|
|
Repayments
|
(380
|
)
|
|
Ending balance on December 31
|
$
|
4,368
|
|
|
December 31, 2017
|
||||||||||||||||||||||
|
Loans Past Due and Still Accruing
|
|
|
|
|
|
|
||||||||||||||||
|
30-89
Days |
|
90 or More
Days |
|
Total Past
Due Loans |
|
Nonaccrual Loans
|
|
Current
Loans |
|
Total Loans
|
||||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||||||
Commercial and industrial
|
$
|
1,069
|
|
|
$
|
—
|
|
|
$
|
1,069
|
|
|
$
|
6,437
|
|
|
$
|
449,623
|
|
|
$
|
457,129
|
|
Mortgage warehouse
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
69,456
|
|
|
69,456
|
|
||||||
Real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Commercial real estate (including multi-family residential)
|
4,932
|
|
|
—
|
|
|
4,932
|
|
|
6,110
|
|
|
1,069,205
|
|
|
1,080,247
|
|
||||||
Commercial real estate construction and land development
|
5,274
|
|
|
—
|
|
|
5,274
|
|
|
—
|
|
|
238,115
|
|
|
243,389
|
|
||||||
1-4 family residential (including home equity)
|
924
|
|
|
—
|
|
|
924
|
|
|
781
|
|
|
299,514
|
|
|
301,219
|
|
||||||
Residential construction
|
674
|
|
|
—
|
|
|
674
|
|
|
—
|
|
|
108,442
|
|
|
109,116
|
|
||||||
Consumer and other
|
74
|
|
|
—
|
|
|
74
|
|
|
—
|
|
|
10,246
|
|
|
10,320
|
|
||||||
Total loans
|
$
|
12,947
|
|
|
$
|
—
|
|
|
$
|
12,947
|
|
|
$
|
13,328
|
|
|
$
|
2,244,601
|
|
|
$
|
2,270,876
|
|
|
December 31, 2016
|
||||||||||||||||||||||
|
Loans Past Due and Still Accruing
|
|
|
|
|
|
|
||||||||||||||||
|
30-89
Days |
|
90 or More
Days |
|
Total Past
Due Loans |
|
Nonaccrual Loans
|
|
Current
Loans |
|
Total Loans
|
||||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||||||
Commercial and industrial
|
$
|
1,028
|
|
|
$
|
911
|
|
|
$
|
1,939
|
|
|
$
|
3,896
|
|
|
$
|
410,917
|
|
|
$
|
416,752
|
|
Mortgage warehouse
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
67,038
|
|
|
67,038
|
|
||||||
Real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Commercial real estate (including multi-family residential)
|
1,661
|
|
|
—
|
|
|
1,661
|
|
|
11,663
|
|
|
878,665
|
|
|
891,989
|
|
||||||
Commercial real estate construction and land development
|
263
|
|
|
—
|
|
|
263
|
|
|
—
|
|
|
158,984
|
|
|
159,247
|
|
||||||
1-4 family residential (including home equity)
|
280
|
|
|
—
|
|
|
280
|
|
|
217
|
|
|
246,490
|
|
|
246,987
|
|
||||||
Residential construction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
98,657
|
|
|
98,657
|
|
||||||
Consumer and other
|
125
|
|
|
—
|
|
|
125
|
|
|
12
|
|
|
10,828
|
|
|
10,965
|
|
||||||
Total loans
|
$
|
3,357
|
|
|
$
|
911
|
|
|
$
|
4,268
|
|
|
$
|
15,788
|
|
|
$
|
1,871,579
|
|
|
$
|
1,891,635
|
|
|
December 31, 2017
|
||||||||||
|
Recorded
Investment |
|
Unpaid
Principal Balance |
|
Related
Allowance |
||||||
|
(Dollars in thousands)
|
||||||||||
With no related allowance recorded:
|
|
|
|
|
|
|
|
|
|||
Commercial and industrial
|
$
|
5,792
|
|
|
$
|
6,666
|
|
|
$
|
—
|
|
Mortgage warehouse
|
—
|
|
|
—
|
|
|
—
|
|
|||
Real estate:
|
|
|
|
|
|
|
|
|
|||
Commercial real estate (including multi-family residential)
|
12,155
|
|
|
12,155
|
|
|
—
|
|
|||
Commercial real estate construction and land development
|
209
|
|
|
209
|
|
|
—
|
|
|||
1-4 family residential (including home equity)
|
948
|
|
|
948
|
|
|
—
|
|
|||
Residential construction
|
—
|
|
|
—
|
|
|
—
|
|
|||
Consumer and other
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total
|
19,104
|
|
|
19,978
|
|
|
—
|
|
|||
|
|
|
|
|
|
||||||
With an allowance recorded:
|
|
|
|
|
|
|
|
|
|||
Commercial and industrial
|
5,600
|
|
|
5,652
|
|
|
1,640
|
|
|||
Mortgage warehouse
|
—
|
|
|
—
|
|
|
—
|
|
|||
Real estate:
|
|
|
|
|
|
|
|
|
|||
Commercial real estate (including multi-family residential)
|
8,009
|
|
|
8,194
|
|
|
716
|
|
|||
Commercial real estate construction and land development
|
—
|
|
|
—
|
|
|
—
|
|
|||
1-4 family residential (including home equity)
|
—
|
|
|
—
|
|
|
—
|
|
|||
Residential construction
|
—
|
|
|
—
|
|
|
—
|
|
|||
Consumer and other
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total
|
13,609
|
|
|
13,846
|
|
|
2,356
|
|
|||
|
|
|
|
|
|
||||||
Total:
|
|
|
|
|
|
|
|
|
|||
Commercial and industrial
|
11,392
|
|
|
12,318
|
|
|
1,640
|
|
|||
Mortgage warehouse
|
—
|
|
|
—
|
|
|
—
|
|
|||
Real estate:
|
|
|
|
|
|
|
|
|
|||
Commercial real estate (including multi-family residential)
|
20,164
|
|
|
20,349
|
|
|
716
|
|
|||
Commercial real estate construction and land development
|
209
|
|
|
209
|
|
|
—
|
|
|||
1-4 family residential (including home equity)
|
948
|
|
|
948
|
|
|
—
|
|
|||
Residential construction
|
—
|
|
|
—
|
|
|
—
|
|
|||
Consumer and other
|
—
|
|
|
—
|
|
|
—
|
|
|||
|
$
|
32,713
|
|
|
$
|
33,824
|
|
|
$
|
2,356
|
|
|
December 31, 2016
|
||||||||||
|
Recorded
Investment |
|
Unpaid
Principal Balance |
|
Related
Allowance |
||||||
|
(Dollars in thousands)
|
||||||||||
With no related allowance recorded:
|
|
|
|
|
|
|
|
|
|||
Commercial and industrial
|
$
|
5,300
|
|
|
$
|
5,414
|
|
|
$
|
—
|
|
Mortgage warehouse
|
—
|
|
|
—
|
|
|
—
|
|
|||
Real estate:
|
|
|
|
|
|
|
|
|
|||
Commercial real estate (including multi-family residential)
|
11,748
|
|
|
11,833
|
|
|
—
|
|
|||
Commercial real estate construction and land development
|
—
|
|
|
—
|
|
|
—
|
|
|||
1-4 family residential (including home equity)
|
217
|
|
|
217
|
|
|
—
|
|
|||
Residential construction
|
—
|
|
|
—
|
|
|
—
|
|
|||
Consumer and other
|
5
|
|
|
5
|
|
|
—
|
|
|||
Total
|
17,270
|
|
|
17,469
|
|
|
—
|
|
|||
|
|
|
|
|
|
||||||
With an allowance recorded:
|
|
|
|
|
|
|
|
|
|||
Commercial and industrial
|
3,108
|
|
|
3,328
|
|
|
1,543
|
|
|||
Mortgage warehouse
|
—
|
|
|
—
|
|
|
—
|
|
|||
Real estate:
|
|
|
|
|
|
|
|
|
|||
Commercial real estate (including multi-family residential)
|
573
|
|
|
573
|
|
|
105
|
|
|||
Commercial real estate construction and land development
|
—
|
|
|
—
|
|
|
—
|
|
|||
1-4 family residential (including home equity)
|
—
|
|
|
—
|
|
|
—
|
|
|||
Residential construction
|
—
|
|
|
—
|
|
|
—
|
|
|||
Consumer and other
|
6
|
|
|
6
|
|
|
6
|
|
|||
Total
|
3,687
|
|
|
3,907
|
|
|
1,654
|
|
|||
|
|
|
|
|
|
||||||
Total:
|
|
|
|
|
|
|
|
|
|||
Commercial and industrial
|
8,408
|
|
|
8,742
|
|
|
1,543
|
|
|||
Mortgage warehouse
|
—
|
|
|
—
|
|
|
—
|
|
|||
Real estate:
|
|
|
|
|
|
|
|
|
|||
Commercial real estate (including multi-family residential)
|
12,321
|
|
|
12,406
|
|
|
105
|
|
|||
Commercial real estate construction and land development
|
—
|
|
|
—
|
|
|
—
|
|
|||
1-4 family residential (including home equity)
|
217
|
|
|
217
|
|
|
—
|
|
|||
Residential construction
|
—
|
|
|
—
|
|
|
—
|
|
|||
Consumer and other
|
11
|
|
|
11
|
|
|
6
|
|
|||
|
$
|
20,957
|
|
|
$
|
21,376
|
|
|
$
|
1,654
|
|
|
Years Ended December 31,
|
||||||||||||||
|
2017
|
|
2016
|
||||||||||||
|
Average Recorded Investment
|
|
Interest Income Recognized
|
|
Average Recorded Investment
|
|
Interest Income Recognized
|
||||||||
|
(Dollars in thousands)
|
||||||||||||||
Commercial and industrial
|
$
|
11,972
|
|
|
$
|
418
|
|
|
$
|
9,427
|
|
|
$
|
442
|
|
Mortgage warehouse
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Real estate:
|
|
|
|
|
|
|
|
||||||||
Commercial real estate (including multi-family residential)
|
20,606
|
|
|
475
|
|
|
12,840
|
|
|
393
|
|
||||
Commercial real estate construction and land development
|
314
|
|
|
10
|
|
|
—
|
|
|
—
|
|
||||
1-4 family residential (including home equity)
|
1,167
|
|
|
18
|
|
|
228
|
|
|
24
|
|
||||
Residential construction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Consumer and other
|
—
|
|
|
1
|
|
|
26
|
|
|
3
|
|
||||
Total
|
$
|
34,059
|
|
|
$
|
922
|
|
|
$
|
22,521
|
|
|
$
|
862
|
|
|
Pass
|
|
Watch
|
|
Special Mention
|
|
Substandard
|
|
Doubtful
|
|
Total
|
||||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||||||
Commercial and industrial
|
$
|
427,336
|
|
|
$
|
10,274
|
|
|
$
|
2,195
|
|
|
$
|
17,324
|
|
|
$
|
—
|
|
|
$
|
457,129
|
|
Mortgage warehouse
|
69,456
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
69,456
|
|
||||||
Real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Commercial real estate (including multi-family residential)
|
1,016,831
|
|
|
23,039
|
|
|
4,685
|
|
|
35,692
|
|
|
—
|
|
|
1,080,247
|
|
||||||
Commercial real estate construction and land development
|
231,536
|
|
|
4,397
|
|
|
—
|
|
|
7,456
|
|
|
—
|
|
|
243,389
|
|
||||||
1-4 family residential (including home equity)
|
295,744
|
|
|
2,696
|
|
|
785
|
|
|
1,994
|
|
|
—
|
|
|
301,219
|
|
||||||
Residential construction
|
103,611
|
|
|
5,505
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
109,116
|
|
||||||
Consumer and other
|
10,207
|
|
|
111
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
10,320
|
|
||||||
Total loans
|
$
|
2,154,721
|
|
|
$
|
46,022
|
|
|
$
|
7,665
|
|
|
$
|
62,468
|
|
|
$
|
—
|
|
|
$
|
2,270,876
|
|
|
Pass
|
|
Watch
|
|
Special Mention
|
|
Substandard
|
|
Doubtful
|
|
Total
|
||||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||||||
Commercial and industrial
|
$
|
384,979
|
|
|
$
|
11,784
|
|
|
$
|
3,344
|
|
|
$
|
16,645
|
|
|
$
|
—
|
|
|
$
|
416,752
|
|
Mortgage warehouse
|
67,038
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
67,038
|
|
||||||
Real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Commercial real estate (including multi-family residential)
|
834,781
|
|
|
16,009
|
|
|
6,804
|
|
|
34,395
|
|
|
—
|
|
|
891,989
|
|
||||||
Commercial real estate construction and land development
|
149,010
|
|
|
8,124
|
|
|
—
|
|
|
2,113
|
|
|
—
|
|
|
159,247
|
|
||||||
1-4 family residential (including home equity)
|
242,208
|
|
|
512
|
|
|
2,069
|
|
|
2,198
|
|
|
—
|
|
|
246,987
|
|
||||||
Residential construction
|
97,808
|
|
|
—
|
|
|
415
|
|
|
434
|
|
|
—
|
|
|
98,657
|
|
||||||
Consumer and other
|
10,520
|
|
|
364
|
|
|
4
|
|
|
77
|
|
|
—
|
|
|
10,965
|
|
||||||
Total loans
|
$
|
1,786,344
|
|
|
$
|
36,793
|
|
|
$
|
12,636
|
|
|
$
|
55,862
|
|
|
$
|
—
|
|
|
$
|
1,891,635
|
|
|
Commercial
and Industrial |
|
Mortgage
Warehouse |
|
Commercial real estate (including multi-family residential)
|
|
Commercial real estate construction and land development
|
|
1-4 family residential (including home equity)
|
|
Residential Construction
|
|
Consumer and Other
|
|
Total
|
||||||||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||||||||||||||
Allowance for loan losses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Balance December 31, 2016
|
$
|
5,059
|
|
|
$
|
—
|
|
|
$
|
8,950
|
|
|
$
|
1,217
|
|
|
$
|
1,876
|
|
|
$
|
748
|
|
|
$
|
61
|
|
|
$
|
17,911
|
|
Provision for loan losses
|
9,792
|
|
|
—
|
|
|
1,424
|
|
|
1,298
|
|
|
254
|
|
|
194
|
|
|
226
|
|
|
13,188
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Charge-offs
|
(7,673
|
)
|
|
—
|
|
|
(124
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(196
|
)
|
|
(7,993
|
)
|
||||||||
Recoveries
|
516
|
|
|
—
|
|
|
3
|
|
|
10
|
|
|
10
|
|
|
—
|
|
|
4
|
|
|
543
|
|
||||||||
Net charge-offs
|
(7,157
|
)
|
|
—
|
|
|
(121
|
)
|
|
10
|
|
|
10
|
|
|
—
|
|
|
(192
|
)
|
|
(7,450
|
)
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance December 31, 2017
|
$
|
7,694
|
|
|
$
|
—
|
|
|
$
|
10,253
|
|
|
$
|
2,525
|
|
|
$
|
2,140
|
|
|
$
|
942
|
|
|
$
|
95
|
|
|
$
|
23,649
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Allowance for loan losses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Balance December 31, 2015
|
$
|
3,644
|
|
|
$
|
—
|
|
|
$
|
5,914
|
|
|
$
|
1,221
|
|
|
$
|
1,432
|
|
|
$
|
820
|
|
|
$
|
67
|
|
|
$
|
13,098
|
|
Provision for loan losses
|
1,951
|
|
|
—
|
|
|
3,122
|
|
|
(4
|
)
|
|
434
|
|
|
(72
|
)
|
|
38
|
|
|
5,469
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Charge-offs
|
(722
|
)
|
|
—
|
|
|
(129
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(49
|
)
|
|
(900
|
)
|
||||||||
Recoveries
|
186
|
|
|
—
|
|
|
43
|
|
|
—
|
|
|
10
|
|
|
—
|
|
|
5
|
|
|
244
|
|
||||||||
Net charge-offs
|
(536
|
)
|
|
—
|
|
|
(86
|
)
|
|
—
|
|
|
10
|
|
|
—
|
|
|
(44
|
)
|
|
(656
|
)
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance December 31, 2016
|
$
|
5,059
|
|
|
$
|
—
|
|
|
$
|
8,950
|
|
|
$
|
1,217
|
|
|
$
|
1,876
|
|
|
$
|
748
|
|
|
$
|
61
|
|
|
$
|
17,911
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Allowance for loan losses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Balance December 31, 2014
|
$
|
2,334
|
|
|
$
|
—
|
|
|
$
|
3,799
|
|
|
$
|
578
|
|
|
$
|
1,008
|
|
|
$
|
475
|
|
|
$
|
52
|
|
|
$
|
8,246
|
|
Provision for loan losses
|
2,193
|
|
|
—
|
|
|
2,115
|
|
|
625
|
|
|
464
|
|
|
321
|
|
|
74
|
|
|
5,792
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Charge-offs
|
(935
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(40
|
)
|
|
—
|
|
|
(65
|
)
|
|
(1,040
|
)
|
||||||||
Recoveries
|
52
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|
—
|
|
|
24
|
|
|
6
|
|
|
100
|
|
||||||||
Net charge-offs
|
(883
|
)
|
|
—
|
|
|
—
|
|
|
18
|
|
|
(40
|
)
|
|
24
|
|
|
(59
|
)
|
|
(940
|
)
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance December 31, 2015
|
$
|
3,644
|
|
|
$
|
—
|
|
|
$
|
5,914
|
|
|
$
|
1,221
|
|
|
$
|
1,432
|
|
|
$
|
820
|
|
|
$
|
67
|
|
|
$
|
13,098
|
|
|
Commercial and Industrial
|
|
Mortgage Warehouse
|
|
Commercial real estate (including multi-family residential)
|
|
Commercial real estate construction and land development
|
|
1-4 family residential (including home equity)
|
|
Residential Construction
|
|
Consumer and Other
|
|
Total
|
||||||||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||||||||||||||
Allowance for loan losses related to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Individually evaluated for impairment
|
$
|
1,640
|
|
|
$
|
—
|
|
|
$
|
716
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,356
|
|
Collectively evaluated for impairment
|
6,054
|
|
|
—
|
|
|
9,537
|
|
|
2,525
|
|
|
2,140
|
|
|
942
|
|
|
95
|
|
|
21,293
|
|
||||||||
Total allowance for loan losses
|
$
|
7,694
|
|
|
$
|
—
|
|
|
$
|
10,253
|
|
|
$
|
2,525
|
|
|
$
|
2,140
|
|
|
$
|
942
|
|
|
$
|
95
|
|
|
$
|
23,649
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Individually evaluated for impairment
|
$
|
1,543
|
|
|
$
|
—
|
|
|
$
|
105
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6
|
|
|
$
|
1,654
|
|
Collectively evaluated for impairment
|
3,516
|
|
|
—
|
|
|
8,845
|
|
|
1,217
|
|
|
1,876
|
|
|
748
|
|
|
55
|
|
|
16,257
|
|
||||||||
Total allowance for loan losses
|
$
|
5,059
|
|
|
$
|
—
|
|
|
$
|
8,950
|
|
|
$
|
1,217
|
|
|
$
|
1,876
|
|
|
$
|
748
|
|
|
$
|
61
|
|
|
$
|
17,911
|
|
|
Commercial and Industrial
|
|
Mortgage Warehouse
|
|
Commercial real estate (including multi-family residential)
|
|
Commercial real estate construction and land development
|
|
1-4 family residential (including home equity)
|
|
Residential Construction
|
|
Consumer and Other
|
|
Total
|
||||||||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||||||||||||||
Recorded investment in loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Individually evaluated for impairment
|
$
|
11,392
|
|
|
$
|
—
|
|
|
$
|
20,164
|
|
|
$
|
209
|
|
|
$
|
948
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
32,713
|
|
Collectively evaluated for impairment
|
445,737
|
|
|
69,456
|
|
|
1,060,083
|
|
|
243,180
|
|
|
300,271
|
|
|
109,116
|
|
|
10,320
|
|
|
2,238,163
|
|
||||||||
Total loans evaluated for impairment
|
$
|
457,129
|
|
|
$
|
69,456
|
|
|
$
|
1,080,247
|
|
|
$
|
243,389
|
|
|
$
|
301,219
|
|
|
$
|
109,116
|
|
|
$
|
10,320
|
|
|
$
|
2,270,876
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Individually evaluated for impairment
|
$
|
8,408
|
|
|
$
|
—
|
|
|
$
|
12,321
|
|
|
$
|
—
|
|
|
$
|
217
|
|
|
$
|
—
|
|
|
$
|
11
|
|
|
$
|
20,957
|
|
Collectively evaluated for impairment
|
408,344
|
|
|
67,038
|
|
|
879,668
|
|
|
159,247
|
|
|
246,770
|
|
|
98,657
|
|
|
10,954
|
|
|
1,870,678
|
|
||||||||
Total loans evaluated for impairment
|
$
|
416,752
|
|
|
$
|
67,038
|
|
|
$
|
891,989
|
|
|
$
|
159,247
|
|
|
$
|
246,987
|
|
|
$
|
98,657
|
|
|
$
|
10,965
|
|
|
$
|
1,891,635
|
|
|
As of December 31,
|
|||||||||||||||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||||||||||||||
|
Number of Contracts
|
|
Pre-Modification of Outstanding Recorded Investment
|
|
Post-Modification of Outstanding Recorded Investment
|
|
Number of Contracts
|
|
Pre-Modification of Outstanding Recorded Investment
|
|
Post-Modification of Outstanding Recorded Investment
|
|
Number of Contracts
|
|
Pre-Modification of Outstanding Recorded Investment
|
|
Post-Modification of Outstanding Recorded Investment
|
|||||||||||||||
|
(Dollars in thousands)
|
|||||||||||||||||||||||||||||||
Commercial and industrial
|
9
|
|
|
$
|
2,399
|
|
|
$
|
2,399
|
|
|
21
|
|
|
$
|
3,939
|
|
|
$
|
3,939
|
|
|
6
|
|
|
$
|
2,959
|
|
|
$
|
2,959
|
|
Mortgage warehouse
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Commercial real estate (including multi-family residential)
|
6
|
|
|
11,837
|
|
|
11,837
|
|
|
8
|
|
|
7,144
|
|
|
7,144
|
|
|
1
|
|
|
63
|
|
|
63
|
|
||||||
Commercial real estate construction and land development
|
1
|
|
|
210
|
|
|
210
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
1-4 family residential (including home equity)
|
1
|
|
|
86
|
|
|
86
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Residential construction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Consumer and other
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
6
|
|
|
6
|
|
|
2
|
|
|
20
|
|
|
20
|
|
||||||
Total
|
17
|
|
|
$
|
14,532
|
|
|
$
|
14,532
|
|
|
30
|
|
|
$
|
11,089
|
|
|
$
|
11,089
|
|
|
9
|
|
|
$
|
3,042
|
|
|
$
|
3,042
|
|
•
|
Level 1—Quoted prices for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.
|
•
|
Level 2—Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.
|
•
|
Level 3—Significant unobservable inputs that reflect management’s judgment and assumptions that market participants would use in pricing an asset or liability that are supported by little or no market activity.
|
|
As of December 31, 2017
|
||||||||||||||||||
|
Carrying
Amount |
|
Estimated Fair Value
|
||||||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||
Financial assets
|
|
||||||||||||||||||
Cash and cash equivalents
|
$
|
182,103
|
|
|
$
|
182,103
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
182,103
|
|
Available for sale securities
|
309,615
|
|
|
—
|
|
|
309,615
|
|
|
—
|
|
|
309,615
|
|
|||||
Loans held for investment, net of allowance
|
2,247,227
|
|
|
—
|
|
|
—
|
|
|
2,238,721
|
|
|
2,238,721
|
|
|||||
FHLB stock
|
12,862
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|||||
Accrued interest receivable
|
12,194
|
|
|
3
|
|
|
3,296
|
|
|
8,895
|
|
|
12,194
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Financial liabilities
|
|
|
|
|
|
|
|
|
|
||||||||||
Total deposits
|
$
|
2,213,974
|
|
|
$
|
—
|
|
|
$
|
2,209,111
|
|
|
$
|
—
|
|
|
$
|
2,209,111
|
|
Accrued interest payable
|
610
|
|
|
—
|
|
|
610
|
|
|
—
|
|
|
610
|
|
|||||
Borrowed funds
|
282,569
|
|
|
—
|
|
|
288,887
|
|
|
—
|
|
|
288,887
|
|
|||||
Subordinated debt
|
48,659
|
|
|
—
|
|
|
48,659
|
|
|
—
|
|
|
48,659
|
|
|
As of December 31, 2016
|
||||||||||||||||||
|
Carrying
Amount |
|
Estimated Fair Value
|
||||||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||
Financial assets
|
|
||||||||||||||||||
Cash and cash equivalents
|
$
|
142,098
|
|
|
$
|
142,098
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
142,098
|
|
Available for sale securities
|
316,455
|
|
|
—
|
|
|
316,455
|
|
|
—
|
|
|
316,455
|
|
|||||
Loans held for investment, net of allowance
|
1,873,724
|
|
|
—
|
|
|
—
|
|
|
1,872,056
|
|
|
1,872,056
|
|
|||||
FHLB Stock
|
13,175
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|||||
Accrued interest receivable
|
9,007
|
|
|
3
|
|
|
3,616
|
|
|
5,388
|
|
|
9,007
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Financial liabilities
|
|
|
|
|
|
|
|
|
|
||||||||||
Total deposits
|
$
|
1,870,183
|
|
|
$
|
—
|
|
|
$
|
1,868,429
|
|
|
$
|
—
|
|
|
$
|
1,868,429
|
|
Accrued interest payable
|
285
|
|
|
—
|
|
|
285
|
|
|
—
|
|
|
285
|
|
|||||
Borrowed funds
|
285,569
|
|
|
—
|
|
|
284,989
|
|
|
—
|
|
|
284,989
|
|
|||||
Subordinated debt
|
9,196
|
|
|
—
|
|
|
9,196
|
|
|
—
|
|
|
9,196
|
|
|
As of December 31, 2017
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
(Dollars in thousands)
|
||||||||||||||
Available for sale securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. Government and agency securities
|
$
|
—
|
|
|
$
|
8,715
|
|
|
$
|
—
|
|
|
$
|
8,715
|
|
Municipal securities
|
—
|
|
|
222,958
|
|
|
—
|
|
|
222,958
|
|
||||
Agency mortgage-backed pass-through securities
|
—
|
|
|
31,812
|
|
|
—
|
|
|
31,812
|
|
||||
Corporate bonds
|
—
|
|
|
46,130
|
|
|
—
|
|
|
46,130
|
|
||||
Total
|
$
|
—
|
|
|
$
|
309,615
|
|
|
$
|
—
|
|
|
$
|
309,615
|
|
|
As of December 31, 2016
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
(Dollars in thousands)
|
||||||||||||||
Available for sale securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
U.S. Government and agency securities
|
$
|
—
|
|
|
$
|
6,149
|
|
|
$
|
—
|
|
|
$
|
6,149
|
|
Municipal securities
|
—
|
|
|
237,802
|
|
|
—
|
|
|
237,802
|
|
||||
Agency mortgage-backed pass-through securities
|
—
|
|
|
27,324
|
|
|
—
|
|
|
27,324
|
|
||||
Corporate bonds
|
—
|
|
|
45,180
|
|
|
—
|
|
|
45,180
|
|
||||
Total
|
$
|
—
|
|
|
$
|
316,455
|
|
|
$
|
—
|
|
|
$
|
316,455
|
|
|
As of December 31, 2017
|
||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||
|
(Dollars in thousands)
|
||||||||||
Impaired loans:
|
|
|
|
|
|
|
|
|
|||
Commercial and industrial
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,012
|
|
Commercial real estate (including multi-family residential)
|
—
|
|
|
—
|
|
|
7,478
|
|
|||
Other real estate owned
|
—
|
|
|
—
|
|
|
365
|
|
|||
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
11,855
|
|
|
As of December 31, 2016
|
||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||
|
(Dollars in thousands)
|
||||||||||
Impaired loans:
|
|
|
|
|
|
|
|
|
|||
Commercial and industrial
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,785
|
|
Commercial real estate (including multi-family residential)
|
—
|
|
|
—
|
|
|
468
|
|
|||
Other real estate owned
|
—
|
|
|
—
|
|
|
1,503
|
|
|||
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,756
|
|
|
As of December 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(Dollars in thousands)
|
||||||
Land
|
$
|
5,376
|
|
|
$
|
5,376
|
|
Buildings
|
7,977
|
|
|
8,034
|
|
||
Leasehold improvements
|
5,059
|
|
|
5,098
|
|
||
Furniture, fixtures and equipment
|
8,967
|
|
|
7,927
|
|
||
Construction in progress
|
320
|
|
|
5
|
|
||
Total
|
27,699
|
|
|
26,440
|
|
||
Less: accumulated depreciation
|
9,222
|
|
|
8,100
|
|
||
Premises and equipment, net
|
$
|
18,477
|
|
|
$
|
18,340
|
|
Within one year
|
$
|
504,104
|
|
After one but within two years
|
129,562
|
|
|
After two but within three years
|
34,922
|
|
|
After three but within four years
|
29,976
|
|
|
After four but within five years
|
62,750
|
|
|
Total
|
$
|
761,314
|
|
2018
|
$
|
—
|
|
2019
|
—
|
|
|
2020
|
—
|
|
|
2021
|
—
|
|
|
2022 and thereafter
|
569
|
|
|
Total
|
$
|
569
|
|
Description
|
|
Issuance Date
|
|
Trust Preferred Securities Outstanding
|
|
Interest Rate
(1)
|
|
Junior Subordinated Debt Owed to Trusts
|
|
Maturity Date
(2)
|
||||
|
|
(Dollars in thousands)
|
||||||||||||
Farmers & Merchants Capital Trust II
|
|
November 13, 2003
|
|
$
|
7,500
|
|
|
3 month LIBOR + 3.00%
|
|
$
|
7,732
|
|
|
November 8, 2033
|
Farmers & Merchants Capital Trust III
|
|
June 30, 2005
|
|
3,500
|
|
|
3 month LIBOR + 1.80%
|
|
3,609
|
|
|
July 7, 2035
|
(1)
|
The 3-month LIBOR in effect as of
December 31, 2017
was
1.6098%
.
|
(2)
|
All debentures are currently callable.
|
|
Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
(Dollars in thousands)
|
||||||||||
Current
|
$
|
8,320
|
|
|
$
|
11,162
|
|
|
$
|
8,221
|
|
Deferred
|
427
|
|
|
(1,608
|
)
|
|
(446
|
)
|
|||
Total
|
$
|
8,747
|
|
|
$
|
9,554
|
|
|
$
|
7,775
|
|
|
Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
(Dollars in thousands)
|
||||||||||
Taxes calculated at statutory rate
|
$
|
9,233
|
|
|
$
|
11,342
|
|
|
$
|
8,247
|
|
Increase (decrease) resulting from:
|
|
|
|
|
|
|
|
|
|||
Stock based compensation
|
(755
|
)
|
|
67
|
|
|
393
|
|
|||
Provisional deferred tax adjustment related to reduction in U.S. federal statutory income tax rate
|
2,621
|
|
|
—
|
|
|
—
|
|
|||
Effect of tax exempt income
|
(2,328
|
)
|
|
(1,929
|
)
|
|
(890
|
)
|
|||
Other, net
|
(24
|
)
|
|
74
|
|
|
25
|
|
|||
Total
|
$
|
8,747
|
|
|
$
|
9,554
|
|
|
$
|
7,775
|
|
|
As of December 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(Dollars in thousands)
|
||||||
Deferred tax assets:
|
|
|
|
|
|
||
Allowance for credit losses
|
$
|
5,284
|
|
|
$
|
6,938
|
|
Net unrealized loss on available for sale securities
|
—
|
|
|
1,642
|
|
||
Deferred compensation
|
177
|
|
|
168
|
|
||
Total deferred tax assets
|
5,461
|
|
|
8,748
|
|
||
|
|
|
|
||||
Deferred tax liabilities:
|
|
|
|
|
|
||
Core deposit intangible and other purchase accounting adjustments
|
(1,100
|
)
|
|
(1,953
|
)
|
||
Net unrealized gain on available for sale securities
|
(65
|
)
|
|
—
|
|
||
Premises and equipment basis difference
|
(321
|
)
|
|
(568
|
)
|
||
Total deferred tax liabilities
|
(1,486
|
)
|
|
(2,521
|
)
|
||
Net deferred tax assets
|
$
|
3,975
|
|
|
$
|
6,227
|
|
|
Number of
Options |
|
Weighted
Average Exercise Price |
|
Weighted
Average Remaining Contractual Term |
|
Aggregate
Intrinsic Value |
|||||
|
(In thousands)
|
|
|
|
(In years)
|
|
(In thousands)
|
|||||
Options outstanding, January 1, 2016
|
969
|
|
|
$
|
17.45
|
|
|
6.62
|
|
$
|
6,006
|
|
Options granted
|
107
|
|
|
22.83
|
|
|
|
|
|
|
||
Options exercised
|
(116
|
)
|
|
15.42
|
|
|
|
|
|
|
||
Options forfeited
|
(25
|
)
|
|
21.56
|
|
|
|
|
|
|
||
Options outstanding, December 31, 2016
|
935
|
|
|
$
|
18.21
|
|
|
6.23
|
|
$
|
16,773
|
|
Options granted
|
64
|
|
|
36.88
|
|
|
|
|
|
|
||
Options exercised
|
(215
|
)
|
|
17.50
|
|
|
|
|
|
|
||
Options forfeited
|
(9
|
)
|
|
23.35
|
|
|
|
|
|
|
||
Options outstanding, December 31, 2017
|
775
|
|
|
$
|
19.94
|
|
|
5.72
|
|
$
|
13,718
|
|
Options vested and exercisable, December 31, 2017
|
484
|
|
|
$
|
16.73
|
|
|
4.42
|
|
$
|
10,127
|
|
|
2017
|
|
2016
|
|
2015
|
||||||
|
(In thousands)
|
||||||||||
Intrinsic value of options exercised
|
$
|
3,371
|
|
|
$
|
1,128
|
|
|
$
|
—
|
|
Cash received from option exercises
|
3,743
|
|
|
1,782
|
|
|
—
|
|
|||
Weighted average fair value of options granted
|
$
|
16.55
|
|
|
$
|
10.51
|
|
|
$
|
6.78
|
|
|
Number of
Shares |
|
Weighted Average Grant Date Fair Value
|
|||
|
(Shares in thousands)
|
|||||
Nonvested share awards outstanding, January 1, 2016
|
18
|
|
|
$
|
19.68
|
|
Share awards granted
|
15
|
|
|
17.52
|
|
|
Share awards vested
|
(9
|
)
|
|
19.45
|
|
|
Nonvested share awards forfeited
|
—
|
|
|
—
|
|
|
Nonvested share awards outstanding, December 31, 2016
|
24
|
|
|
18.31
|
|
|
Share awards granted
|
28
|
|
|
36.17
|
|
|
Share awards vested
|
(11
|
)
|
|
18.32
|
|
|
Nonvested share awards forfeited
|
—
|
|
|
—
|
|
|
Nonvested share awards outstanding, December 31, 2017
|
41
|
|
|
$
|
30.46
|
|
|
December 31,
|
||||||||||||||
|
2017
|
|
2016
|
||||||||||||
|
Fixed
Rate |
|
Variable
Rate |
|
Fixed
Rate |
|
Variable
Rate |
||||||||
|
(Dollars in thousands)
|
||||||||||||||
Commitments to extend credit
|
$
|
369,573
|
|
|
$
|
250,467
|
|
|
$
|
353,822
|
|
|
$
|
232,551
|
|
Standby letters of credit
|
15,445
|
|
|
1,725
|
|
|
9,423
|
|
|
124
|
|
||||
Total
|
$
|
385,018
|
|
|
$
|
252,192
|
|
|
$
|
363,245
|
|
|
$
|
232,675
|
|
2018
|
$
|
1,806
|
|
2019
|
1,030
|
|
|
2020
|
1,039
|
|
|
2021
|
911
|
|
|
2022
|
893
|
|
|
Thereafter
|
3,780
|
|
|
|
$
|
9,459
|
|
|
Actual
|
|
Minimum Required For Capital
Adequacy Purposes |
|
Minimum Required Plus Capital Conservation Buffer
|
|
To Be Categorized As Well Capitalized Under
Prompt Corrective Action Provisions |
||||||||||||||||||||
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
||||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||||||||||
ALLEGIANCE BANCSHARES, INC.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
(Consolidated)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
As of December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Total Capital (to Risk Weighted Assets)
|
$
|
336,829
|
|
|
13.43
|
%
|
|
$
|
200,687
|
|
|
8.00
|
%
|
|
$
|
232,044
|
|
|
9.250
|
%
|
|
N/A
|
|
|
N/A
|
|
|
Common Equity Tier 1 Capital (to Risk Weighted Assets)
|
264,521
|
|
|
10.54
|
%
|
|
112,886
|
|
|
4.50
|
%
|
|
144,244
|
|
|
5.750
|
%
|
|
N/A
|
|
|
N/A
|
|
||||
Tier 1 Capital (to Risk Weighted Assets)
|
273,825
|
|
|
10.92
|
%
|
|
150,515
|
|
|
6.00
|
%
|
|
181,872
|
|
|
7.250
|
%
|
|
N/A
|
|
|
N/A
|
|
||||
Tier 1 Capital (to Average Tangible Assets)
|
273,825
|
|
|
9.84
|
%
|
|
111,274
|
|
|
4.00
|
%
|
|
111,274
|
|
|
4.000
|
%
|
|
N/A
|
|
|
N/A
|
|
||||
As of December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Total Capital (to Risk Weighted Assets)
|
$
|
268,155
|
|
|
12.57
|
%
|
|
$
|
170,690
|
|
|
8.00
|
%
|
|
$
|
184,025
|
|
|
8.625
|
%
|
|
N/A
|
|
|
N/A
|
|
|
Common Equity Tier 1 Capital (to Risk Weighted Assets)
|
241,048
|
|
|
11.30
|
%
|
|
96,013
|
|
|
4.50
|
%
|
|
109,348
|
|
|
5.125
|
%
|
|
N/A
|
|
|
N/A
|
|
||||
Tier 1 Capital (to Risk Weighted Assets)
|
250,244
|
|
|
11.73
|
%
|
|
128,018
|
|
|
6.00
|
%
|
|
141,353
|
|
|
6.625
|
%
|
|
N/A
|
|
|
N/A
|
|
||||
Tier 1 Capital (to Average Tangible Assets)
|
250,244
|
|
|
10.35
|
%
|
|
96,708
|
|
|
4.00
|
%
|
|
96,708
|
|
|
4.000
|
%
|
|
N/A
|
|
|
N/A
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
ALLEGIANCE BANK
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
As of December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Total Capital (to Risk Weighted Assets)
|
$
|
331,872
|
|
|
13.24
|
%
|
|
$
|
200,596
|
|
|
8.00
|
%
|
|
$
|
231,939
|
|
|
9.250
|
%
|
|
$
|
250,745
|
|
|
10.00
|
%
|
Common Equity Tier 1 Capital (to Risk Weighted Assets)
|
268,868
|
|
|
10.72
|
%
|
|
112,835
|
|
|
4.50
|
%
|
|
144,179
|
|
|
5.750
|
%
|
|
162,985
|
|
|
6.50
|
%
|
||||
Tier 1 Capital (to Risk Weighted Assets)
|
268,868
|
|
|
10.72
|
%
|
|
150,447
|
|
|
6.00
|
%
|
|
181,790
|
|
|
7.250
|
%
|
|
200,596
|
|
|
8.00
|
%
|
||||
Tier 1 Capital (to Average Tangible Assets)
|
268,868
|
|
|
9.67
|
%
|
|
111,230
|
|
|
4.00
|
%
|
|
111,230
|
|
|
4.000
|
%
|
|
139,037
|
|
|
5.00
|
%
|
||||
As of December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Total Capital (to Risk Weighted Assets)
|
$
|
247,606
|
|
|
11.61
|
%
|
|
$
|
170,630
|
|
|
8.00
|
%
|
|
$
|
183,960
|
|
|
8.625
|
%
|
|
$
|
213,288
|
|
|
10.00
|
%
|
Common Equity Tier 1 Capital (to Risk Weighted Assets)
|
229,694
|
|
|
10.77
|
%
|
|
95,979
|
|
|
4.50
|
%
|
|
109,310
|
|
|
5.125
|
%
|
|
138,637
|
|
|
6.50
|
%
|
||||
Tier 1 Capital (to Risk Weighted Assets)
|
229,694
|
|
|
10.77
|
%
|
|
127,973
|
|
|
6.00
|
%
|
|
141,303
|
|
|
6.625
|
%
|
|
170,630
|
|
|
8.00
|
%
|
||||
Tier 1 Capital (to Average Tangible Assets)
|
229,694
|
|
|
9.50
|
%
|
|
96,679
|
|
|
4.00
|
%
|
|
96,679
|
|
|
4.000
|
%
|
|
120,849
|
|
|
5.00
|
%
|
|
Years Ended December 31,
|
||||||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||||||||||||||
|
Amount
|
|
Per Share
Amount |
|
Amount
|
|
Per Share
Amount |
|
Amount
|
|
Per Share
Amount |
||||||||||||
|
(Amounts in thousands, except per share data)
|
||||||||||||||||||||||
Net income attributable to common shareholders
|
$
|
17,632
|
|
|
|
|
|
$
|
22,851
|
|
|
|
|
|
$
|
15,227
|
|
|
|
|
|||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Weighted average common shares outstanding
|
13,125
|
|
|
$
|
1.34
|
|
|
12,873
|
|
|
$
|
1.78
|
|
|
10,470
|
|
|
$
|
1.45
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Add incremental shares for:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Dilutive effect of stock option exercises
|
333
|
|
|
|
|
|
201
|
|
|
|
|
|
184
|
|
|
|
|
||||||
Total
|
13,458
|
|
|
$
|
1.31
|
|
|
13,074
|
|
|
$
|
1.75
|
|
|
10,654
|
|
|
$
|
1.43
|
|
|
December 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(Dollars in thousands)
|
||||||
ASSETS
|
|
|
|
|
|
||
Cash and due from banks
|
$
|
4,857
|
|
|
$
|
21,206
|
|
Investment in subsidiary
|
311,553
|
|
|
268,804
|
|
||
Other assets
|
791
|
|
|
412
|
|
||
TOTAL
|
$
|
317,201
|
|
|
$
|
290,422
|
|
|
|
|
|
||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
||
LIABILITIES:
|
|
|
|
|
|
||
Borrowed funds
|
$
|
569
|
|
|
$
|
569
|
|
Subordinated debentures
|
9,304
|
|
|
9,197
|
|
||
Accrued interest payable and other liabilities
|
463
|
|
|
839
|
|
||
Total liabilities
|
10,336
|
|
|
10,605
|
|
||
|
|
|
|
||||
SHAREHOLDERS’ EQUITY:
|
|
|
|
|
|
||
Common stock
|
13,227
|
|
|
12,958
|
|
||
Capital surplus
|
218,408
|
|
|
212,649
|
|
||
Retained earnings
|
74,894
|
|
|
57,262
|
|
||
Accumulated other comprehensive income (loss)
|
336
|
|
|
(3,052
|
)
|
||
Total shareholders’ equity
|
306,865
|
|
|
279,817
|
|
||
TOTAL
|
$
|
317,201
|
|
|
$
|
290,422
|
|
|
For the Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
(Dollars in thousands)
|
||||||||||
OPERATING INCOME:
|
|
|
|
|
|
|
|
|
|||
Other income
|
$
|
13
|
|
|
$
|
11
|
|
|
$
|
16
|
|
Total operating income
|
13
|
|
|
11
|
|
|
16
|
|
|||
OPERATING EXPENSE:
|
|
|
|
|
|
|
|
|
|||
Interest expense on borrowed funds
|
33
|
|
|
30
|
|
|
707
|
|
|||
Other expenses
|
1,465
|
|
|
1,204
|
|
|
771
|
|
|||
Total operating expense
|
1,498
|
|
|
1,234
|
|
|
1,478
|
|
|||
Income before income tax benefit and equity in undistributed income of subsidiaries
|
(1,485
|
)
|
|
(1,223
|
)
|
|
(1,462
|
)
|
|||
Income tax benefit
|
756
|
|
|
428
|
|
|
500
|
|
|||
Income before equity in undistributed income of subsidiaries
|
(729
|
)
|
|
(795
|
)
|
|
(962
|
)
|
|||
Equity in undistributed income of subsidiaries
|
18,361
|
|
|
23,646
|
|
|
16,748
|
|
|||
Net income
|
$
|
17,632
|
|
|
$
|
22,851
|
|
|
$
|
15,786
|
|
Preferred stock dividends
|
—
|
|
|
—
|
|
|
559
|
|
|||
Net income attributable to common shareholders
|
$
|
17,632
|
|
|
$
|
22,851
|
|
|
$
|
15,227
|
|
|
For the Years Ended December 31,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
(Dollars in thousands)
|
||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|||
Net income
|
$
|
17,632
|
|
|
$
|
22,851
|
|
|
$
|
15,786
|
|
Adjustments to reconcile net income to net cash used in operating activities:
|
|
|
|
|
|
|
|
|
|||
Equity in undistributed earnings of subsidiaries
|
(18,361
|
)
|
|
(23,646
|
)
|
|
(16,748
|
)
|
|||
Net amortization of discount on subordinated debentures
|
107
|
|
|
107
|
|
|
218
|
|
|||
(Increase) decrease in other assets
|
(378
|
)
|
|
(399
|
)
|
|
220
|
|
|||
(Decrease) increase in accrued interest payable and other liabilities
|
(377
|
)
|
|
186
|
|
|
(462
|
)
|
|||
Net cash used in operating activities
|
(1,377
|
)
|
|
(901
|
)
|
|
(986
|
)
|
|||
|
|
|
|
|
|
||||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|||
Net cash and cash equivalents acquired in the purchase of F&M Bancshares, Inc.
|
—
|
|
|
—
|
|
|
818
|
|
|||
Capital investment in bank subsidiary
|
(21,000
|
)
|
|
—
|
|
|
(12,000
|
)
|
|||
Net cash used in investing activities
|
(21,000
|
)
|
|
—
|
|
|
(11,182
|
)
|
|||
|
|
|
|
|
|
||||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|||
Proceeds from issuance of common stock
|
4,248
|
|
|
2,006
|
|
|
133
|
|
|||
Proceeds from initial public offering
|
—
|
|
|
—
|
|
|
57,138
|
|
|||
Stock based compensation expense
|
1,780
|
|
|
1,501
|
|
|
1,351
|
|
|||
Proceeds on borrowed funds
|
—
|
|
|
—
|
|
|
18,000
|
|
|||
Paydowns of borrowed funds
|
—
|
|
|
—
|
|
|
(45,500
|
)
|
|||
Redemption of preferred stock
|
—
|
|
|
—
|
|
|
(11,550
|
)
|
|||
Preferred stock dividends
|
—
|
|
|
—
|
|
|
(559
|
)
|
|||
Issuance (repurchase) of treasury stock
|
—
|
|
|
38
|
|
|
(52
|
)
|
|||
Net cash provided by financing activities
|
6,028
|
|
|
3,545
|
|
|
18,961
|
|
|||
NET CHANGE IN CASH AND CASH EQUIVALENTS
|
(16,349
|
)
|
|
2,644
|
|
|
6,793
|
|
|||
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD
|
21,206
|
|
|
18,562
|
|
|
11,769
|
|
|||
CASH AND CASH EQUIVALENTS, END OF PERIOD
|
$
|
4,857
|
|
|
$
|
21,206
|
|
|
$
|
18,562
|
|
|
Interest
|
|
Net Interest
|
|
Net Income Attributable to Common
|
|
Earnings Per Share
(1)
|
||||||||||||
|
Income
|
|
Income
|
|
Shareholders
|
|
Basic
|
|
Diluted
|
||||||||||
|
(Dollars in thousands, except per share data)
|
||||||||||||||||||
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
First quarter
|
$
|
27,512
|
|
|
$
|
24,128
|
|
|
$
|
6,047
|
|
|
$
|
0.46
|
|
|
$
|
0.45
|
|
Second quarter
|
28,987
|
|
|
25,107
|
|
|
5,395
|
|
|
0.41
|
|
|
0.40
|
|
|||||
Third quarter
|
30,901
|
|
|
26,997
|
|
|
2,986
|
|
|
0.23
|
|
|
0.22
|
|
|||||
Fourth quarter
|
32,038
|
|
|
27,436
|
|
|
3,204
|
|
|
0.24
|
|
|
0.24
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
First quarter
|
$
|
23,451
|
|
|
$
|
21,084
|
|
|
$
|
6,355
|
|
|
$
|
0.49
|
|
|
$
|
0.49
|
|
Second quarter
|
24,527
|
|
|
21,949
|
|
|
5,254
|
|
|
0.41
|
|
|
0.40
|
|
|||||
Third quarter
|
26,319
|
|
|
23,409
|
|
|
5,471
|
|
|
0.42
|
|
|
0.42
|
|
|||||
Fourth quarter
|
26,481
|
|
|
23,422
|
|
|
5,771
|
|
|
0.45
|
|
|
0.44
|
|
(1)
|
Earnings per share are computed independently for each of the quarters presented and therefore may not total earnings per share for the year.
|
Direct Subsidiaries
|
|
Jurisdiction of Organization
|
|
Parent Entity
|
Allegiance Bank
|
|
Texas
|
|
Allegiance Bancshares, Inc.
|
Farmers & Merchants Capital Trust II
|
|
Delaware
|
|
Allegiance Bancshares, Inc.
|
Farmers & Merchants Capital Trust III
|
|
Delaware
|
|
Allegiance Bancshares, Inc.
|
|
|
|
|
|
Indirect Subsidiaries
|
|
Jurisdiction of Organization
|
|
Parent Entity
|
ABTX Financial, Inc.
|
|
Texas
|
|
Allegiance Bank
|
1.
|
I have reviewed this Annual Report on Form 10-K of Allegiance Bancshares, Inc.;
|
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;
|
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;
|
4.
|
The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted 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
|
d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ George Martinez
|
George Martinez
|
Chairman and Chief Executive Officer
|
1.
|
I have reviewed this Annual Report on Form 10-K of Allegiance Bancshares, Inc.;
|
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;
|
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;
|
4.
|
The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted 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
|
d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Paul P. Egge
|
Paul P. Egge
|
Chief Financial Officer
|
/s/ George Martinez
|
George Martinez
|
Chairman and Chief Executive Officer
|
/s/ Paul P. Egge
|
Paul P. Egge
|
Chief Financial Officer
|