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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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Texas
|
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75-1848732
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(State or other jurisdiction of incorporation or organization)
|
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(I.R.S. Employer Identification No.)
|
1201 S. Beckham Avenue, Tyler, Texas
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75701
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(Address of Principal Executive Offices)
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|
(Zip Code)
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Name of each exchange
|
Title of each class
|
|
on which registered
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COMMON STOCK, $1.25 PAR VALUE
|
|
NASDAQ Global Select Market
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PART I
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ITEM 1. BUSINESS
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ITEM 1A. RISK FACTORS
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ITEM 1B. UNRESOLVED STAFF COMMENTS
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ITEM 2. PROPERTIES
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ITEM 3. LEGAL PROCEEDINGS
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ITEM 4. MINE SAFETY DISCLOSURES
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PART II
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ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
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ITEM 6. SELECTED FINANCIAL DATA
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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
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CONSOLIDATED FINANCIAL STATEMENTS
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
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ITEM 9A. CONTROLS AND PROCEDURES
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ITEM 9B. OTHER INFORMATION
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PART III
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ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
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ITEM 11. EXECUTIVE COMPENSATION
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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE
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ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
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PART IV
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ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
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ITEM 16. FORM 10-K SUMMARY
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SIGNATURES
|
ITEM 1.
|
BUSINESS
|
•
|
Creation of the Bureau with centralized authority, including supervisory, examination and enforcement authority, for consumer protection in the banking industry;
|
•
|
New limitations on federal preemption;
|
•
|
New prohibitions and restrictions on the ability of a banking entity and nonbank financial company to engage in proprietary trading and have certain interests in, or relationships with, a hedge fund or private equity fund;
|
•
|
Application of new regulatory capital requirements, including changes to leverage and risk-based capital standards and changes to the components of permissible tiered capital;
|
•
|
Requirement that holding companies and their subsidiary banks be well capitalized and well managed in order to engage in activities permitted for financial holding companies;
|
•
|
Impacts to accounting and reporting obligations resulting from the change to corporate income tax rates under the 2017 Tax Cuts and Jobs Act (“Tax Act”);
|
•
|
Changes to the assessment base for deposit insurance premiums;
|
•
|
Permanently raising the FDIC’s standard maximum deposit insurance amount to $250,000;
|
•
|
Repeal of the prohibition on the payment of interest on demand deposits, thereby permitting depository institutions to pay interest on business transaction and other accounts;
|
•
|
Restrictions on compensation, including a prohibition on incentive-based compensation arrangements that encourage inappropriate risk taking by covered financial institutions and are deemed to be excessive, or that may lead to material losses;
|
•
|
Requirement that sponsors of asset-backed securities retain a percentage of the credit risk underlying the securities; and
|
•
|
Requirement that banking regulators remove references to and requirements of reliance upon credit ratings from their regulations and replace them with appropriate alternatives for evaluating creditworthiness.
|
•
|
banking or managing or controlling banks;
|
•
|
furnishing services to or performing services for our subsidiaries; and
|
•
|
any activity that the Federal Reserve determines to be so closely related to banking as to be a proper incident to the business of banking, including:
|
◦
|
factoring accounts receivable;
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◦
|
making, acquiring, brokering or servicing loans and usual related activities;
|
◦
|
leasing personal or real property;
|
◦
|
operating a nonbank depository institution, such as a savings association;
|
◦
|
performing trust company functions;
|
◦
|
conducting financial and investment advisory activities;
|
◦
|
conducting discount securities brokerage activities;
|
◦
|
underwriting and dealing in government obligations and money market instruments;
|
◦
|
providing specified management consulting and counseling activities;
|
◦
|
performing selected data processing services and support services;
|
◦
|
acting as agent or broker in selling credit life insurance and other types of insurance in connection with credit transactions;
|
◦
|
performing selected insurance underwriting activities;
|
◦
|
providing certain community development activities (such as making investments in projects designed primarily to promote community welfare); and
|
◦
|
issuing and selling money orders and similar consumer-type payment instruments.
|
|
Capital Adequacy Ratios
|
||||||||||
|
Regulatory
Minimums
|
|
Regulatory
Minimums
to be Well
Capitalized
|
|
Southside
Bancshares,
Inc.
|
|
Southside
Bank
|
||||
Common Equity Tier 1 risk-based capital ratio
|
4.50
|
%
|
|
6.50
|
%
|
|
14.77
|
%
|
|
18.59
|
%
|
Tier 1 risk-based capital ratio
|
6.00
|
%
|
|
8.00
|
%
|
|
16.29
|
%
|
|
18.59
|
%
|
Total risk-based capital ratio
|
8.00
|
%
|
|
10.00
|
%
|
|
19.59
|
%
|
|
19.34
|
%
|
Leverage ratio
|
4.00
|
%
|
|
5.00
|
%
|
|
10.64
|
%
|
|
12.14
|
%
|
•
|
Well Capitalized - The insured depository institution exceeds the required minimum level for each relevant capital measure. Under the 2015 Capital Rules, a well-capitalized insured depository institution is one (1) having a total risk-based capital ratio of 10 percent or greater, (2) having a Tier 1 risk-based capital ratio of 8 percent or greater, (3) having a CET1 capital ratio of 6.5 percent or greater, (4) having a leverage capital ratio of 5 percent or greater and (5) that is not subject to any order or written directive to meet and maintain a specific capital level for any capital measure.
|
•
|
Adequately Capitalized - The insured depository institution meets the required minimum level for each relevant capital measure. Under the 2015 Capital Rules, an adequately-capitalized depository institution is one having (1) a total risk based capital ratio of 8 percent or more, (2) a Tier 1 capital ratio of 6 percent or more, (3) a CET1 capital ratio of 4.5 percent or more and (4) a leverage ratio of 4 percent or more.
|
•
|
Undercapitalized - The insured depository institution fails to meet the required minimum level for any relevant capital measure. Under the 2015 Capital Rules, an undercapitalized depository institution is one having (1) a total capital ratio of less than 8 percent, (2) a Tier 1 capital ratio of less than 6 percent, (3) a CET1 capital ratio of less than 4.5 percent or (4) a leverage ratio of less than 4 percent.
|
•
|
Significantly Undercapitalized - The insured depository institution is significantly below the required minimum level for any relevant capital measure. Under the 2015 Capital Rules, a significantly undercapitalized institution is one having (1) a total risk-based capital ratio of less than 6 percent (2) a Tier 1 capital ratio of less than 4 percent, (3) a CET1 ratio of less than 3 percent or (4) a leverage capital ratio of less than 3 percent.
|
•
|
Critically Undercapitalized - The insured depository institution fails to meet a critical capital level set by the appropriate federal banking agency. A critically undercapitalized institution is one having a ratio of tangible equity to total assets that is equal to or less than 2 percent.
|
•
|
the Truth In Lending Act and Regulation Z, governing disclosures of credit terms to consumer borrowers;
|
•
|
the Home Mortgage Disclosure Act and Regulation C, requiring financial institutions to provide information to enable the public and public officials to determine whether a financial institution is fulfilling its obligation to help meet the housing needs of the community it serves;
|
•
|
the Equal Credit Opportunity Act and Regulation B, prohibiting discrimination on the basis of race, creed or other prohibited factors in extending credit;
|
•
|
the Fair Credit Reporting Act and Regulation V, governing the use and provision of information to consumer reporting agencies;
|
•
|
the Fair Debt Collection Act, governing the manner in which consumer debts may be collected by collection agencies; and
|
•
|
the guidance of the various federal agencies charged with the responsibility of implementing such federal laws.
|
•
|
the Truth in Savings Act and Regulation DD, governing disclosure of deposit account terms to consumers;
|
•
|
the Right to Financial Privacy Act, which imposes a duty to maintain confidentiality of consumer financial records and prescribes procedures for complying with administrative subpoenas of financial records; and
|
•
|
the Electronic Fund Transfer Act and Regulation E, which governs automatic deposits to and withdrawals from deposit accounts and customers’ rights and liabilities arising from the use of ATMs and other electronic banking services, which the Bureau has expanded to include a new compliance regime that governs consumer-initiated cross border electronic transfers.
|
•
|
total reported loans for construction, land development and other land represent 100 percent or more of the institution’s total capital, or
|
•
|
total commercial real estate loans represent 300 percent or more of the institution’s total capital and the outstanding balance of the institution’s commercial real estate loan portfolio has increased by 50 percent or more during the prior 36 months.
|
•
|
establishment of anti-money laundering programs, including adoption of written procedures and an ongoing employee training program, designation of a compliance officer and auditing of the program;
|
•
|
establishment of a program specifying procedures for obtaining information from customers seeking to open new accounts, including verifying the identity of customers within a reasonable period of time;
|
•
|
establishment of enhanced due diligence policies, procedures and controls designed to detect and report money laundering, for financial institutions that administer, maintain or manage private bank accounts or correspondent accounts for non-U.S. persons;
|
•
|
prohibitions on correspondent accounts for foreign shell banks and compliance with recordkeeping obligations with respect to correspondent accounts of foreign banks;
|
•
|
filing of suspicious activities reports if a bank believes a customer may be violating U.S. laws and regulations; and
|
•
|
requirements that bank regulators consider bank holding company or bank compliance in connection with merger or acquisition transactions.
|
•
|
our ability to originate loans and obtain deposits;
|
•
|
our ability to retain deposits in a rising rate environment;
|
•
|
net interest rate spreads and net interest rate margins;
|
•
|
our ability to enter into instruments to hedge against interest rate risk;
|
•
|
the fair value of our financial assets and liabilities; and
|
•
|
the average duration of our loan and mortgage-backed securities portfolio.
|
•
|
increases in loan delinquencies;
|
•
|
increases in nonperforming assets and foreclosures;
|
•
|
decreases in demand for our products and services, which could adversely affect our liquidity position;
|
•
|
decreases in the value of the collateral securing our loans, especially real estate, which could reduce customers’ borrowing power;
|
•
|
decreases in the credit quality of our non-U.S. Government and non-U.S. agency investment securities, corporate and municipal securities;
|
•
|
an adverse or unfavorable resolution of the Fannie Mae or Freddie Mac receivership; and
|
•
|
decreases in the real estate values subject to ad-valorem taxes by municipalities that impact such municipalities’ ability to repay their debt, which could adversely affect our municipal loans or debt securities.
|
•
|
the ability to develop, maintain and build upon long-term customer relationships based on top quality service, high ethical standards and safe, sound assets;
|
•
|
the ability to expand our market position;
|
•
|
the scope, relevance and pricing of products and services offered to meet customer needs and demands;
|
•
|
the rate at which we introduce new products and services relative to our competitors;
|
•
|
our ability to invest in or partner with technology providers offering banking solutions and delivery channels at a level equal to our competitors;
|
•
|
customer satisfaction with our level of service; and
|
•
|
industry and general economic trends.
|
•
|
actual or anticipated variations in our results of operations, financial conditions or asset quality;
|
•
|
recommendations by securities analysts;
|
•
|
operating and stock price performance of other companies that investors deem comparable to us;
|
•
|
news reports relating to trends, concerns and other issues in the financial services industry;
|
•
|
perceptions in the marketplace regarding us and/or our competitors;
|
•
|
perceptions in the marketplace regarding the impact of the change in price per barrel of crude oil on the Texas economy;
|
•
|
new technology used or services offered by competitors;
|
•
|
significant acquisitions or business combinations, strategic partnerships, joint ventures or capital commitments by or involving us or our competitors;
|
•
|
failure to integrate acquisitions or realize anticipated benefits from acquisitions;
|
•
|
future issuances of our common stock or other securities;
|
•
|
additions or departures of key personnel;
|
•
|
changes in government regulations; and
|
•
|
geopolitical conditions such as acts or threats of terrorism or military conflicts.
|
Period
|
|
Total Number of
Shares
Purchased
|
|
Average Price Paid
Per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plan
|
|
Maximum Number of Shares That May Yet Be Purchased Under the Plan at the End of the Period
|
|||||
October 25, 2018
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
1,500,000
|
|
October 26, 2018-October 31, 2018
|
|
56,592
|
|
|
31.52
|
|
|
56,592
|
|
|
1,443,408
|
|
|
November 1, 2018-November 30, 2018
|
|
894,021
|
|
|
32.74
|
|
|
894,021
|
|
|
549,387
|
|
|
December 1, 2018-December 31, 2018
|
|
508,535
|
|
|
31.74
|
|
|
508,535
|
|
|
40,852
|
|
|
Total
|
|
1,459,148
|
|
|
$
|
32.34
|
|
|
1,459,148
|
|
|
|
|
|
Period Ending
|
|
|||||||||
Index
|
12/31/13
|
|
12/31/14
|
|
12/31/15
|
|
12/31/16
|
|
12/31/17
|
|
12/31/18
|
|
Southside Bancshares, Inc.
|
100.00
|
|
114.65
|
|
103.65
|
|
176.59
|
|
167.13
|
|
163.16
|
|
Russell 2000
|
100.00
|
|
104.89
|
|
100.26
|
|
121.63
|
|
139.44
|
|
124.09
|
|
SBSI Peer Group Index*
|
100.00
|
|
90.7
|
|
83.64
|
|
131.80
|
|
136.13
|
|
116.61
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
||||||
*Peer group index includes Cullen/Frost Bankers, Inc.(CFR), First Financial Bankshares, Inc.(FFIN), Hilltop Holdings (HTH), Independent Bank Group, Inc. (IBTX), LegacyTexas Financial Group, Inc. (LTXB), Prosperity Bancshares, Inc. (PB), Texas Capital Bancshares, Inc. (TCBI) and Veritex Holdings, Inc. (VBTX).
|
||||||||||||
|
|
|
||||||||||
Source : S&P Global Market Intelligence
|
|
|
|
|
|
|
||||||
© 2019
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
As of and for the Years Ended December 31,
|
||||||||||||||||||
|
|
2018
|
|
2017
(1)
|
|
2016
|
|
2015
|
|
2014
(2)
|
||||||||||
|
|
(in thousands, except per share data)
|
||||||||||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Securities available for sale, at estimated fair value
(3)
|
|
$
|
1,989,436
|
|
|
$
|
1,538,755
|
|
|
$
|
1,479,600
|
|
|
$
|
1,460,492
|
|
|
$
|
1,448,708
|
|
Securities held to maturity, at carrying value
|
|
$
|
162,931
|
|
|
$
|
909,506
|
|
|
$
|
937,487
|
|
|
$
|
784,296
|
|
|
$
|
642,319
|
|
Loans, net of allowance for loan losses
|
|
$
|
3,285,780
|
|
|
$
|
3,273,575
|
|
|
$
|
2,538,626
|
|
|
$
|
2,412,017
|
|
|
$
|
2,167,841
|
|
Total assets
|
|
$
|
6,123,494
|
|
|
$
|
6,498,097
|
|
|
$
|
5,563,767
|
|
|
$
|
5,161,996
|
|
|
$
|
4,807,176
|
|
Deposits
|
|
$
|
4,425,030
|
|
|
$
|
4,515,447
|
|
|
$
|
3,533,076
|
|
|
$
|
3,455,407
|
|
|
$
|
3,374,417
|
|
FHLB borrowings
|
|
$
|
719,065
|
|
|
$
|
1,017,361
|
|
|
$
|
1,309,646
|
|
|
$
|
1,147,688
|
|
|
$
|
897,420
|
|
Subordinated notes, net of unamortized debt issuance costs
|
|
$
|
98,407
|
|
|
$
|
98,248
|
|
|
$
|
98,100
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Trust preferred subordinated debentures, net of unamortized debt issuance costs
|
|
$
|
60,246
|
|
|
$
|
60,241
|
|
|
$
|
60,236
|
|
|
$
|
60,231
|
|
|
$
|
60,226
|
|
Shareholders’ equity
|
|
$
|
731,291
|
|
|
$
|
754,140
|
|
|
$
|
518,274
|
|
|
$
|
444,062
|
|
|
$
|
425,243
|
|
Income Statement Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Interest income
|
|
$
|
229,165
|
|
|
$
|
187,474
|
|
|
$
|
168,913
|
|
|
$
|
154,532
|
|
|
$
|
123,778
|
|
Interest expense
|
|
$
|
57,101
|
|
|
$
|
43,504
|
|
|
$
|
29,348
|
|
|
$
|
19,854
|
|
|
$
|
16,956
|
|
Provision for loan losses
|
|
$
|
8,437
|
|
|
$
|
4,675
|
|
|
$
|
9,780
|
|
|
$
|
8,343
|
|
|
$
|
14,938
|
|
Deposit services
(3)
|
|
$
|
25,082
|
|
|
$
|
21,785
|
|
|
$
|
20,702
|
|
|
$
|
20,112
|
|
|
$
|
15,280
|
|
Net (loss) gain on sale of securities available for sale
|
|
$
|
(1,839
|
)
|
|
$
|
625
|
|
|
$
|
2,836
|
|
|
$
|
3,660
|
|
|
$
|
2,830
|
|
Noninterest income
(3)
|
|
$
|
40,773
|
|
|
$
|
37,473
|
|
|
$
|
39,411
|
|
|
$
|
37,895
|
|
|
$
|
24,489
|
|
Noninterest expense
(3)
|
|
$
|
120,099
|
|
|
$
|
106,335
|
|
|
$
|
109,522
|
|
|
$
|
112,954
|
|
|
$
|
97,704
|
|
Net income
(3)
|
|
$
|
74,138
|
|
|
$
|
54,312
|
|
|
$
|
49,349
|
|
|
$
|
43,997
|
|
|
$
|
20,833
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Per Share Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Earnings per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Basic
|
|
$
|
2.12
|
|
|
$
|
1.82
|
|
|
$
|
1.82
|
|
|
$
|
1.61
|
|
|
$
|
0.97
|
|
Diluted
|
|
$
|
2.11
|
|
|
$
|
1.81
|
|
|
$
|
1.81
|
|
|
$
|
1.61
|
|
|
$
|
0.97
|
|
Cash dividends paid per common share
|
|
$
|
1.20
|
|
|
$
|
1.11
|
|
|
$
|
1.01
|
|
|
$
|
1.00
|
|
|
$
|
0.96
|
|
Book value per common share
|
|
$
|
21.68
|
|
|
$
|
21.55
|
|
|
$
|
17.71
|
|
|
$
|
16.25
|
|
|
$
|
15.61
|
|
(1)
|
We completed the acquisition of Diboll on November 30, 2017. Accordingly, our balance sheet data as of December 31, 2017 reflects the effects of the acquisition of Diboll. Income statement data with respect to Diboll includes only the results of Diboll’s operations subsequent to the closing of the acquisition of Diboll on November 30 through December 31, 2017.
|
(2)
|
We completed the acquisition of Omni on December 17, 2014. Accordingly, our balance sheet data as of December 31, 2014 reflects the effects of the acquisition of Omni. Income statement data with respect to Omni includes only the results of Omni’s operations subsequent to the closing of the acquisition of Omni on December 17 through December 31, 2014.
|
(3)
|
Due to the adoption of certain regulatory guidance adopted under the modified retrospective approach, prior periods may not be comparative. Additionally, the Tax Act was enacted on December 22, 2017. S
ee “Note 1 - Summary of Significant Accounting and Reporting Policies – Accounting Changes and Reclassifications” for further information.
|
•
|
general economic conditions, either globally, nationally, in the State of Texas, or in the specific markets in which we operate, including, without limitation, the deterioration of the commercial real estate, residential real estate, construction and development, energy, oil and gas, credit and liquidity markets, which could cause an adverse change in our net interest margin, or a decline in the value of our assets, which could result in realized losses;
|
•
|
current or future legislation, regulatory changes or changes in monetary or fiscal policy that adversely affect the businesses in which we are engaged, including the impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank Act”), the Federal Reserve’s actions with respect to interest rates, the capital requirements promulgated by the Basel Committee on Banking Supervision (“Basel Committee”) and other regulatory responses to economic conditions;
|
•
|
adverse changes in the status or financial condition of the Government-Sponsored Enterprises (the “GSEs”) which impact the GSEs’ guarantees or ability to pay or issue debt;
|
•
|
adverse changes in the credit portfolio of other U.S. financial institutions relative to the performance of certain of our investment securities;
|
•
|
economic or other disruptions caused by acts of terrorism in the United States, Europe or other areas;
|
•
|
technological changes, including potential cyber-security incidents;
|
•
|
our ability to identify and address cyber-security risks such as data security breaches, malware, “denial of service” attacks, “hacking” and identity theft, a failure of which could disrupt our business and result in the disclosure of and/or misuse or misappropriation of confidential or proprietary information, disruption or damage of our systems, increased costs, significant losses, or adverse effects to our reputation;
|
•
|
the risk that our enterprise risk management framework may not identify or address risks adequately, which may result in unexpected losses;
|
•
|
changes in the interest rate yield curve such as flat, inverted or steep yield curves, or changes in the interest rate environment that impact interest margins and may impact prepayments on our mortgage-backed securities (“MBS”) portfolio;
|
•
|
increases in our nonperforming assets;
|
•
|
our ability to maintain adequate liquidity to fund operations and growth;
|
•
|
any applicable regulatory limits or other restrictions on Southside Bank’s ability to pay dividends to us;
|
•
|
the failure of our assumptions underlying allowance for loan losses and other estimates;
|
•
|
the failure to maintain an effective system of controls and procedures, including internal control over financial reporting;
|
•
|
the effectiveness of our derivative financial instruments and hedging activities to manage risk;
|
•
|
unexpected outcomes of, and the costs associated with, existing or new litigation involving us;
|
•
|
changes impacting our balance sheet and leverage strategy;
|
•
|
risks related to actual mortgage prepayments diverging from projections;
|
•
|
risks related to actual U.S. Agency MBS prepayments exceeding projected prepayment levels;
|
•
|
risks related to U.S. Agency MBS prepayments increasing due to U.S. Government programs designed to assist homeowners to refinance their mortgage that might not otherwise have qualified;
|
•
|
our ability to monitor interest rate risk;
|
•
|
risks related to fluctuations in the price per barrel of crude oil;
|
•
|
significant increases in competition in the banking and financial services industry;
|
•
|
changes in consumer spending, borrowing and saving habits;
|
•
|
execution of future acquisitions, reorganization or disposition transactions, including the risk that the anticipated benefits of such transactions are not realized;
|
•
|
our ability to increase market share and control expenses;
|
•
|
our ability to develop competitive new products and services in a timely manner and the acceptance of such products and services by our customers;
|
•
|
the effect of changes in federal or state tax laws;
|
•
|
the effect of compliance with legislation or regulatory changes;
|
•
|
the effect of changes in accounting policies and practices;
|
•
|
credit risks of borrowers, including any increase in those risks due to changing economic conditions;
|
•
|
risks related to loans secured by real estate, including the risk that the value and marketability of collateral could decline; and
|
•
|
the risks identified in “Part I - Item 1A. Risk Factors – Risks Related to Our Business” in this report.
|
|
|
Years Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Net interest income (GAAP)
|
|
$
|
172,064
|
|
|
$
|
143,970
|
|
|
$
|
139,565
|
|
Tax-equivalent adjustments:
|
|
|
|
|
|
|
||||||
Loans
|
|
2,354
|
|
|
4,313
|
|
|
4,251
|
|
|||
Investment securities (tax-exempt)
|
|
7,004
|
|
|
13,197
|
|
|
13,739
|
|
|||
Net interest income (FTE)
(1)
|
|
$
|
181,422
|
|
|
$
|
161,480
|
|
|
$
|
157,555
|
|
|
|
|
|
|
|
|
||||||
Average earning assets
|
|
$
|
5,699,985
|
|
|
$
|
5,254,431
|
|
|
$
|
4,829,141
|
|
|
|
|
|
|
|
|
||||||
Net interest margin
|
|
3.02
|
%
|
|
2.74
|
%
|
|
2.89
|
%
|
|||
Net interest margin (FTE)
(1)
|
|
3.18
|
%
|
|
3.07
|
%
|
|
3.26
|
%
|
|||
|
|
|
|
|
|
|
||||||
Net interest spread
|
|
2.72
|
%
|
|
2.56
|
%
|
|
2.77
|
%
|
|||
Net interest spread (FTE)
(1)
|
|
2.88
|
%
|
|
2.89
|
%
|
|
3.14
|
%
|
(1)
|
These amounts are presented on a fully taxable-equivalent basis and are non-GAAP measures.
|
|
|
Years Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Interest income
|
|
|
|
|
|
|
||||||
Loans
|
|
$
|
158,691
|
|
|
$
|
117,633
|
|
|
$
|
106,564
|
|
Investment securities – taxable
|
|
417
|
|
|
939
|
|
|
1,057
|
|
|||
Investment securities – tax-exempt
|
|
24,960
|
|
|
24,529
|
|
|
22,654
|
|
|||
Mortgage-backed securities
|
|
41,584
|
|
|
41,361
|
|
|
37,450
|
|
|||
FHLB stock and equity investments
|
|
1,595
|
|
|
1,306
|
|
|
798
|
|
|||
Other interest earning assets
|
|
1,918
|
|
|
1,706
|
|
|
390
|
|
|||
Total interest income
|
|
229,165
|
|
|
187,474
|
|
|
168,913
|
|
|||
Interest expense
|
|
|
|
|
|
|
|
|
|
|||
Deposits
|
|
35,864
|
|
|
20,736
|
|
|
14,255
|
|
|||
FHLB borrowings
|
|
12,813
|
|
|
15,106
|
|
|
11,751
|
|
|||
Subordinated notes
|
|
5,659
|
|
|
5,633
|
|
|
1,628
|
|
|||
Trust preferred subordinated debentures
|
|
2,610
|
|
|
2,013
|
|
|
1,706
|
|
|||
Other borrowings
|
|
155
|
|
|
16
|
|
|
8
|
|
|||
Total interest expense
|
|
57,101
|
|
|
43,504
|
|
|
29,348
|
|
|||
Net interest income
|
|
$
|
172,064
|
|
|
$
|
143,970
|
|
|
$
|
139,565
|
|
|
Years Ended December 31, 2018 Compared to 2017
|
|
Years Ended December 31, 2017 Compared to 2016
|
||||||||||||||||||||
|
Change Attributable to
|
|
Total Change
|
|
Change Attributable to
|
|
Total Change
|
||||||||||||||||
Fully Taxable-Equivalent Basis:
|
Average Volume
|
|
Average Yield/Rate
|
|
|
Average Volume
|
|
Average Yield/Rate
|
|
||||||||||||||
Interest income on:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Loans
(1)
|
$
|
30,072
|
|
|
$
|
9,141
|
|
|
$
|
39,213
|
|
|
$
|
9,734
|
|
|
$
|
1,382
|
|
|
$
|
11,116
|
|
Loans held for sale
|
(149
|
)
|
|
35
|
|
|
(114
|
)
|
|
1
|
|
|
14
|
|
|
15
|
|
||||||
Investment securities (taxable)
|
(831
|
)
|
|
309
|
|
|
(522
|
)
|
|
(153
|
)
|
|
35
|
|
|
(118
|
)
|
||||||
Investment securities (tax-exempt)
(1)
|
739
|
|
|
(6,501
|
)
|
|
(5,762
|
)
|
|
3,336
|
|
|
(2,003
|
)
|
|
1,333
|
|
||||||
Mortgage-backed securities
|
(2,253
|
)
|
|
2,476
|
|
|
223
|
|
|
1,668
|
|
|
2,243
|
|
|
3,911
|
|
||||||
FHLB stock and equity investments
|
(262
|
)
|
|
551
|
|
|
289
|
|
|
173
|
|
|
335
|
|
|
508
|
|
||||||
Interest earning deposits
|
(1,015
|
)
|
|
1,005
|
|
|
(10
|
)
|
|
574
|
|
|
675
|
|
|
1,249
|
|
||||||
Federal funds sold
|
164
|
|
|
58
|
|
|
222
|
|
|
60
|
|
|
7
|
|
|
67
|
|
||||||
Total earning assets
|
26,465
|
|
|
7,074
|
|
|
33,539
|
|
|
15,393
|
|
|
2,688
|
|
|
18,081
|
|
||||||
Interest expense on:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Savings deposits
|
191
|
|
|
252
|
|
|
443
|
|
|
28
|
|
|
156
|
|
|
184
|
|
||||||
Time deposits
|
2,115
|
|
|
4,991
|
|
|
7,106
|
|
|
432
|
|
|
2,590
|
|
|
3,022
|
|
||||||
Interest bearing demand deposits
|
2,144
|
|
|
5,435
|
|
|
7,579
|
|
|
(130
|
)
|
|
3,405
|
|
|
3,275
|
|
||||||
FHLB borrowings
|
(7,509
|
)
|
|
5,216
|
|
|
(2,293
|
)
|
|
1,906
|
|
|
1,449
|
|
|
3,355
|
|
||||||
Subordinated notes, net of unamortized debt issuance costs
|
9
|
|
|
17
|
|
|
26
|
|
|
4,035
|
|
|
(30
|
)
|
|
4,005
|
|
||||||
Trust preferred subordinated debentures, net of unamortized debt issuance costs
|
—
|
|
|
597
|
|
|
597
|
|
|
—
|
|
|
307
|
|
|
307
|
|
||||||
Other borrowings
|
7
|
|
|
132
|
|
|
139
|
|
|
2
|
|
|
6
|
|
|
8
|
|
||||||
Total interest bearing liabilities
|
(3,043
|
)
|
|
16,640
|
|
|
13,597
|
|
|
6,273
|
|
|
7,883
|
|
|
14,156
|
|
||||||
Net change
|
$
|
29,508
|
|
|
$
|
(9,566
|
)
|
|
$
|
19,942
|
|
|
$
|
9,120
|
|
|
$
|
(5,195
|
)
|
|
$
|
3,925
|
|
(1)
|
Interest yields on loans and securities that are nontaxable for federal income tax purposes are presented on a fully taxable-equivalent basis assuming a marginal tax rate of 21% for 2018 and 35% for 2017 and 2016. See “Non-GAAP Financial Measures.”
|
|
Average Balances with Average Yields and Rates
|
|||||||||||||||||||||||||||||||
|
Years Ended
|
|||||||||||||||||||||||||||||||
|
December 31, 2018
|
|
December 31, 2017
|
|
December 31, 2016
|
|||||||||||||||||||||||||||
|
Avg Balance
|
|
Interest
|
|
Avg Yield/Rate
|
|
Avg Balance
|
|
Interest
|
|
Avg Yield/Rate
|
|
Avg Balance
|
|
Interest
|
|
Avg Yield/Rate
|
|||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Loans
(1)
|
$
|
3,290,651
|
|
|
$
|
160,982
|
|
|
4.89
|
%
|
|
$
|
2,666,265
|
|
|
$
|
121,769
|
|
|
4.57
|
%
|
|
$
|
2,452,803
|
|
|
$
|
110,653
|
|
|
4.51
|
%
|
Loans held for sale
|
1,451
|
|
|
63
|
|
|
4.34
|
%
|
|
5,058
|
|
|
177
|
|
|
3.50
|
%
|
|
5,036
|
|
|
162
|
|
|
3.22
|
%
|
||||||
Securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Investment securities (taxable)
(2)
|
15,790
|
|
|
417
|
|
|
2.64
|
%
|
|
51,654
|
|
|
939
|
|
|
1.82
|
%
|
|
60,145
|
|
|
1,057
|
|
|
1.76
|
%
|
||||||
Investment securities (tax-exempt)
(2)
|
781,127
|
|
|
31,964
|
|
|
4.09
|
%
|
|
765,854
|
|
|
37,726
|
|
|
4.93
|
%
|
|
699,472
|
|
|
36,393
|
|
|
5.20
|
%
|
||||||
Mortgage-backed and related securities
(2)
|
1,462,055
|
|
|
41,584
|
|
|
2.84
|
%
|
|
1,543,826
|
|
|
41,361
|
|
|
2.68
|
%
|
|
1,479,528
|
|
|
37,450
|
|
|
2.53
|
%
|
||||||
Total securities
|
2,258,972
|
|
|
73,965
|
|
|
3.27
|
%
|
|
2,361,334
|
|
|
80,026
|
|
|
3.39
|
%
|
|
2,239,145
|
|
|
74,900
|
|
|
3.35
|
%
|
||||||
FHLB stock, at cost, and equity investments
|
54,998
|
|
|
1,595
|
|
|
2.90
|
%
|
|
66,855
|
|
|
1,306
|
|
|
1.95
|
%
|
|
56,071
|
|
|
798
|
|
|
1.42
|
%
|
||||||
Interest earning deposits
|
78,266
|
|
|
1,624
|
|
|
2.07
|
%
|
|
148,924
|
|
|
1,634
|
|
|
1.10
|
%
|
|
75,339
|
|
|
385
|
|
|
0.51
|
%
|
||||||
Federal funds sold
|
15,647
|
|
|
294
|
|
|
1.88
|
%
|
|
5,995
|
|
|
72
|
|
|
1.20
|
%
|
|
747
|
|
|
5
|
|
|
0.67
|
%
|
||||||
Total earning assets
|
5,699,985
|
|
|
238,523
|
|
|
4.18
|
%
|
|
5,254,431
|
|
|
204,984
|
|
|
3.90
|
%
|
|
4,829,141
|
|
|
186,903
|
|
|
3.87
|
%
|
||||||
Cash and due from banks
|
77,946
|
|
|
|
|
|
|
54,590
|
|
|
|
|
|
|
51,160
|
|
|
|
|
|
||||||||||||
Accrued interest and other assets
|
473,639
|
|
|
|
|
|
|
369,872
|
|
|
|
|
|
|
373,278
|
|
|
|
|
|
||||||||||||
Less: Allowance for loan losses
|
(24,378
|
)
|
|
|
|
|
|
(19,042
|
)
|
|
|
|
|
|
(18,465
|
)
|
|
|
|
|
||||||||||||
Total assets
|
$
|
6,227,192
|
|
|
|
|
|
|
$
|
5,659,851
|
|
|
|
|
|
|
$
|
5,235,114
|
|
|
|
|
|
|||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Savings deposits
|
$
|
359,509
|
|
|
907
|
|
|
0.25
|
%
|
|
$
|
267,345
|
|
|
464
|
|
|
0.17
|
%
|
|
$
|
244,826
|
|
|
280
|
|
|
0.11
|
%
|
|||
Time deposits
|
1,160,423
|
|
|
18,112
|
|
|
1.56
|
%
|
|
990,553
|
|
|
11,006
|
|
|
1.11
|
%
|
|
941,716
|
|
|
7,984
|
|
|
0.85
|
%
|
||||||
Interest bearing demand deposits
|
1,978,140
|
|
|
16,845
|
|
|
0.85
|
%
|
|
1,645,557
|
|
|
9,266
|
|
|
0.56
|
%
|
|
1,681,422
|
|
|
5,991
|
|
|
0.36
|
%
|
||||||
Total interest bearing deposits
|
3,498,072
|
|
|
35,864
|
|
|
1.03
|
%
|
|
2,903,455
|
|
|
20,736
|
|
|
0.71
|
%
|
|
2,867,964
|
|
|
14,255
|
|
|
0.50
|
%
|
||||||
FHLB borrowings
|
720,785
|
|
|
12,813
|
|
|
1.78
|
%
|
|
1,222,033
|
|
|
15,106
|
|
|
1.24
|
%
|
|
1,060,631
|
|
|
11,751
|
|
|
1.11
|
%
|
||||||
Subordinated notes, net of unamortized debt issuance costs
|
98,327
|
|
|
5,659
|
|
|
5.76
|
%
|
|
98,172
|
|
|
5,633
|
|
|
5.74
|
%
|
|
27,860
|
|
|
1,628
|
|
|
5.84
|
%
|
||||||
Trust preferred subordinated debentures, net of unamortized debt issuance costs
|
60,243
|
|
|
2,610
|
|
|
4.33
|
%
|
|
60,238
|
|
|
2,013
|
|
|
3.34
|
%
|
|
60,233
|
|
|
1,706
|
|
|
2.83
|
%
|
||||||
Other borrowings
|
10,880
|
|
|
155
|
|
|
1.42
|
%
|
|
8,120
|
|
|
16
|
|
|
0.20
|
%
|
|
6,798
|
|
|
8
|
|
|
0.12
|
%
|
||||||
Total interest bearing liabilities
|
4,388,307
|
|
|
57,101
|
|
|
1.30
|
%
|
|
4,292,018
|
|
|
43,504
|
|
|
1.01
|
%
|
|
4,023,486
|
|
|
29,348
|
|
|
0.73
|
%
|
||||||
Noninterest bearing deposits
|
1,040,447
|
|
|
|
|
|
|
761,370
|
|
|
|
|
|
|
693,929
|
|
|
|
|
|
||||||||||||
Accrued expenses and other liabilities
|
47,176
|
|
|
|
|
|
|
43,440
|
|
|
|
|
|
|
49,275
|
|
|
|
|
|
||||||||||||
Total liabilities
|
5,475,930
|
|
|
|
|
|
|
5,096,828
|
|
|
|
|
|
|
4,766,690
|
|
|
|
|
|
||||||||||||
Shareholders’ equity
|
751,262
|
|
|
|
|
|
|
563,023
|
|
|
|
|
|
|
468,424
|
|
|
|
|
|
|
|
||||||||||
Total liabilities and shareholders’ equity
|
$
|
6,227,192
|
|
|
|
|
|
|
$
|
5,659,851
|
|
|
|
|
|
|
$
|
5,235,114
|
|
|
|
|
|
|
|
|||||||
Net interest income (FTE)
|
|
|
$
|
181,422
|
|
|
|
|
|
|
$
|
161,480
|
|
|
|
|
|
|
|
$
|
157,555
|
|
|
|
|
|||||||
Net interest margin (FTE)
|
|
|
|
|
3.18
|
%
|
|
|
|
|
|
3.07
|
%
|
|
|
|
|
|
|
|
3.26
|
%
|
||||||||||
Net interest spread (FTE)
|
|
|
|
|
2.88
|
%
|
|
|
|
|
|
2.89
|
%
|
|
|
|
|
|
|
|
3.14
|
%
|
(1)
|
Interest on loans includes net fees on loans that are not material in amount.
|
(2)
|
For the purpose of calculating the average yield, the average balance of securities is presented at historical cost.
|
(3)
|
Note: As of
December 31, 2018
,
2017
and
2016
, loans totaling
$35.8 million
,
$2.9 million
and
$8.3 million
, respectively, were on nonaccrual status. Our policy is to reverse previously accrued but unpaid interest on nonaccrual loans; thereafter, interest income is recorded to the extent received when appropriate.
|
|
2018
|
|
Increase
(Decrease)
|
|
2017
|
|
Increase
(Decrease)
|
|
2016
|
||||||||||||||||
Deposit services
|
$
|
25,082
|
|
|
$
|
3,297
|
|
|
15.1
|
%
|
|
$
|
21,785
|
|
|
$
|
1,083
|
|
|
5.2
|
%
|
|
$
|
20,702
|
|
Net (loss) gain on sale of securities available for sale
|
(1,839
|
)
|
|
(2,464
|
)
|
|
(394.2
|
)%
|
|
625
|
|
|
(2,211
|
)
|
|
(78.0
|
)%
|
|
2,836
|
|
|||||
Gain on sale of loans
|
692
|
|
|
(1,129
|
)
|
|
(62.0
|
)%
|
|
1,821
|
|
|
(974
|
)
|
|
(34.8
|
)%
|
|
2,795
|
|
|||||
Trust income
|
6,832
|
|
|
3,014
|
|
|
78.9
|
%
|
|
3,818
|
|
|
327
|
|
|
9.4
|
%
|
|
3,491
|
|
|||||
Bank owned life insurance income
|
2,923
|
|
|
386
|
|
|
15.2
|
%
|
|
2,537
|
|
|
(89
|
)
|
|
(3.4
|
)%
|
|
2,626
|
|
|||||
Brokerage services
|
1,987
|
|
|
(435
|
)
|
|
(18.0
|
)%
|
|
2,422
|
|
|
295
|
|
|
13.9
|
%
|
|
2,127
|
|
|||||
Other noninterest income
|
5,096
|
|
|
631
|
|
|
14.1
|
%
|
|
4,465
|
|
|
(369
|
)
|
|
(7.6
|
)%
|
|
4,834
|
|
|||||
Total noninterest income
|
$
|
40,773
|
|
|
$
|
3,300
|
|
|
8.8
|
%
|
|
$
|
37,473
|
|
|
$
|
(1,938
|
)
|
|
(4.9
|
)%
|
|
$
|
39,411
|
|
|
2018
|
|
Increase
(Decrease)
|
|
2017
|
|
Increase
(Decrease)
|
|
2016
|
||||||||||||||||
Salaries and employee benefits
|
$
|
70,643
|
|
|
$
|
9,864
|
|
|
16.2
|
%
|
|
$
|
60,779
|
|
|
$
|
(849
|
)
|
|
(1.4
|
)%
|
|
$
|
61,628
|
|
Occupancy expense
|
13,814
|
|
|
1,746
|
|
|
14.5
|
%
|
|
12,068
|
|
|
(1,654
|
)
|
|
(12.1
|
)%
|
|
13,722
|
|
|||||
Acquisition expense
|
2,413
|
|
|
(1,939
|
)
|
|
(44.6
|
)%
|
|
4,352
|
|
|
4,352
|
|
|
—
|
%
|
|
—
|
|
|||||
Advertising, travel & entertainment
|
2,894
|
|
|
675
|
|
|
30.4
|
%
|
|
2,219
|
|
|
(424
|
)
|
|
(16.0
|
)%
|
|
2,643
|
|
|||||
ATM and debit card expense
|
1,090
|
|
|
(2,799
|
)
|
|
(72.0
|
)%
|
|
3,889
|
|
|
753
|
|
|
24.0
|
%
|
|
3,136
|
|
|||||
Professional fees
|
4,035
|
|
|
191
|
|
|
5.0
|
%
|
|
3,844
|
|
|
(1,102
|
)
|
|
(22.3
|
)%
|
|
4,946
|
|
|||||
Software and data processing expense
|
3,996
|
|
|
969
|
|
|
32.0
|
%
|
|
3,027
|
|
|
116
|
|
|
4.0
|
%
|
|
2,911
|
|
|||||
Telephone and communications
|
1,847
|
|
|
(58
|
)
|
|
(3.0
|
)%
|
|
1,905
|
|
|
(26
|
)
|
|
(1.3
|
)%
|
|
1,931
|
|
|||||
FDIC insurance
|
1,871
|
|
|
102
|
|
|
5.8
|
%
|
|
1,769
|
|
|
(372
|
)
|
|
(17.4
|
)%
|
|
2,141
|
|
|||||
Amortization expense on intangibles
|
5,213
|
|
|
3,258
|
|
|
166.6
|
%
|
|
1,955
|
|
|
15
|
|
|
0.8
|
%
|
|
1,940
|
|
|||||
Other noninterest expense
|
12,283
|
|
|
1,755
|
|
|
16.7
|
%
|
|
10,528
|
|
|
(3,996
|
)
|
|
(27.5
|
)%
|
|
14,524
|
|
|||||
Total noninterest expense
|
$
|
120,099
|
|
|
$
|
13,764
|
|
|
12.9
|
%
|
|
$
|
106,335
|
|
|
$
|
(3,187
|
)
|
|
(2.9
|
)%
|
|
$
|
109,522
|
|
|
|
December 31,
|
||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Real Estate Loans:
|
|
|
||||||||||||||||||
Construction
|
|
$
|
507,732
|
|
|
$
|
475,867
|
|
|
$
|
380,175
|
|
|
$
|
438,247
|
|
|
$
|
267,830
|
|
1-4 Family Residential
|
|
794,499
|
|
|
805,341
|
|
|
637,239
|
|
|
655,410
|
|
|
690,895
|
|
|||||
Commercial
|
|
1,194,118
|
|
|
1,265,159
|
|
|
945,978
|
|
|
635,210
|
|
|
468,171
|
|
|||||
Commercial Loans
|
|
356,649
|
|
|
266,422
|
|
|
177,265
|
|
|
242,527
|
|
|
226,460
|
|
|||||
Municipal Loans
|
|
353,370
|
|
|
345,798
|
|
|
298,583
|
|
|
288,115
|
|
|
257,492
|
|
|||||
Loans to Individuals
|
|
106,431
|
|
|
135,769
|
|
|
117,297
|
|
|
172,244
|
|
|
270,285
|
|
|||||
Total Loans
|
|
$
|
3,312,799
|
|
|
$
|
3,294,356
|
|
|
$
|
2,556,537
|
|
|
$
|
2,431,753
|
|
|
$
|
2,181,133
|
|
|
Due in One
Year or Less
(1)
|
|
After One but
Within Five Years
|
|
After Five
Years
(2)
|
||||||
Real Estate Loans – Construction
|
$
|
197,501
|
|
|
$
|
218,193
|
|
|
$
|
92,038
|
|
Commercial Loans
|
155,966
|
|
|
167,692
|
|
|
32,991
|
|
|||
Municipal Loans
|
6,848
|
|
|
62,619
|
|
|
283,903
|
|
|||
Total
|
$
|
360,315
|
|
|
$
|
448,504
|
|
|
$
|
408,932
|
|
Loans with Maturities After
|
|
|
||
One Year for Which:
|
Interest Rates are Fixed or Predetermined
|
$
|
417,103
|
|
|
Interest Rates are Floating or Adjustable
|
$
|
440,333
|
|
(1)
|
The volume of commercial loans due within one year reflects our general policy of attempting to limit these loans to a short-term maturity.
|
(2)
|
Nonaccrual loans totaling
$651,000
are reflected in the due after five years column.
|
|
Years Ended December 31,
|
||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Average Net Loans Outstanding
(1)
|
$
|
3,290,651
|
|
|
$
|
2,666,265
|
|
|
$
|
2,452,803
|
|
|
$
|
2,224,401
|
|
|
$
|
1,420,802
|
|
Balance of Allowance for Loan Losses at Beginning of Period
(1)
|
$
|
20,781
|
|
|
$
|
17,911
|
|
|
$
|
19,736
|
|
|
$
|
13,292
|
|
|
$
|
18,877
|
|
Loan Charge-Offs:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Real Estate:
|
|
|
|
|
|
|
|
|
|
||||||||||
Construction
|
(14
|
)
|
|
(35
|
)
|
|
—
|
|
|
(24
|
)
|
|
(14
|
)
|
|||||
1-4 Family Residential
|
(91
|
)
|
|
(304
|
)
|
|
(43
|
)
|
|
(58
|
)
|
|
(22
|
)
|
|||||
Commercial
|
(783
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Commercial Loans
(2)
|
(756
|
)
|
|
(723
|
)
|
|
(11,396
|
)
|
|
(336
|
)
|
|
(66
|
)
|
|||||
Municipal Loans
|
—
|
|
|
—
|
|
|
—
|
|
|
(249
|
)
|
|
—
|
|
|||||
Loans to Individuals
|
(2,602
|
)
|
|
(2,391
|
)
|
|
(2,948
|
)
|
|
(3,688
|
)
|
|
(22,461
|
)
|
|||||
Total Loan Charge-Offs
|
(4,246
|
)
|
|
(3,453
|
)
|
|
(14,387
|
)
|
|
(4,355
|
)
|
|
(22,563
|
)
|
|||||
Recovery of Loans Previously Charged-Off:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Real Estate:
|
|
|
|
|
|
|
|
|
|
||||||||||
Construction
|
7
|
|
|
1
|
|
|
269
|
|
|
207
|
|
|
156
|
|
|||||
1-4 Family Residential
|
356
|
|
|
19
|
|
|
141
|
|
|
115
|
|
|
81
|
|
|||||
Commercial
|
36
|
|
|
13
|
|
|
23
|
|
|
85
|
|
|
8
|
|
|||||
Commercial Loans
|
244
|
|
|
312
|
|
|
666
|
|
|
153
|
|
|
171
|
|
|||||
Municipal Loans
|
—
|
|
|
—
|
|
|
249
|
|
|
—
|
|
|
—
|
|
|||||
Loans to Individuals
|
1,404
|
|
|
1,303
|
|
|
1,434
|
|
|
1,896
|
|
|
1,624
|
|
|||||
Total Recovery of Loans Previously Charged-Off
|
2,047
|
|
|
1,648
|
|
|
2,782
|
|
|
2,456
|
|
|
2,040
|
|
|||||
Net Loan Charge-Offs
|
(2,199
|
)
|
|
(1,805
|
)
|
|
(11,605
|
)
|
|
(1,899
|
)
|
|
(20,523
|
)
|
|||||
Provision for Loan Losses
(3)
|
8,437
|
|
|
4,675
|
|
|
9,780
|
|
|
8,343
|
|
|
14,938
|
|
|||||
Allowance for Loan Losses at End of Period
|
$
|
27,019
|
|
|
$
|
20,781
|
|
|
$
|
17,911
|
|
|
$
|
19,736
|
|
|
$
|
13,292
|
|
Net Charge-Offs to Average Net Loans Outstanding
|
0.07
|
%
|
|
0.07
|
%
|
|
0.47
|
%
|
|
0.09
|
%
|
|
1.44
|
%
|
|||||
Allowance for Loan Losses to Nonaccruing Loans
|
75.54
|
|
|
707.56
|
|
|
216.32
|
|
|
96.15
|
|
|
324.51
|
|
|||||
Allowance for Loan Losses to Nonperforming Assets
|
62.97
|
|
|
198.44
|
|
|
118.58
|
|
|
60.76
|
|
|
108.27
|
|
|||||
Allowance for Loan Losses to Total Loans
|
0.82
|
|
|
0.63
|
|
|
0.70
|
|
|
0.81
|
|
|
0.61
|
|
|
|
December 31,
|
|||||||||||||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|||||||||||||||||||||||||
|
|
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 |
|||||||||||||||
Real Estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Construction
|
|
$
|
3,597
|
|
|
15.3
|
%
|
|
$
|
3,676
|
|
|
14.5
|
%
|
|
$
|
4,147
|
|
|
14.9
|
%
|
|
$
|
4,350
|
|
|
18.0
|
%
|
|
$
|
2,456
|
|
|
12.3
|
%
|
1-4 Family Residential
|
|
3,844
|
|
|
24.0
|
%
|
|
2,445
|
|
|
24.4
|
%
|
|
2,665
|
|
|
24.9
|
%
|
|
2,595
|
|
|
27.0
|
%
|
|
2,822
|
|
|
31.6
|
%
|
|||||
Commercial
|
|
13,968
|
|
|
36.0
|
%
|
|
10,821
|
|
|
38.4
|
%
|
|
7,204
|
|
|
37.0
|
%
|
|
4,577
|
|
|
26.1
|
%
|
|
3,025
|
|
|
21.5
|
%
|
|||||
Commercial Loans
|
|
3,974
|
|
|
10.8
|
%
|
|
2,094
|
|
|
8.1
|
%
|
|
2,263
|
|
|
6.9
|
%
|
|
6,596
|
|
|
10.0
|
%
|
|
3,279
|
|
|
10.4
|
%
|
|||||
Municipal Loans
|
|
525
|
|
|
10.7
|
%
|
|
860
|
|
|
10.5
|
%
|
|
750
|
|
|
11.7
|
%
|
|
725
|
|
|
11.8
|
%
|
|
716
|
|
|
11.8
|
%
|
|||||
Loans to Individuals
|
|
1,111
|
|
|
3.2
|
%
|
|
885
|
|
|
4.1
|
%
|
|
882
|
|
|
4.6
|
%
|
|
893
|
|
|
7.1
|
%
|
|
994
|
|
|
12.4
|
%
|
|||||
Ending Balance
|
|
$
|
27,019
|
|
|
100.0
|
%
|
|
$
|
20,781
|
|
|
100.0
|
%
|
|
$
|
17,911
|
|
|
100.0
|
%
|
|
$
|
19,736
|
|
|
100.0
|
%
|
|
$
|
13,292
|
|
|
100.0
|
%
|
|
|
December 31,
|
||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Accruing Loans Past Due More Than 90 Days:
(1)
|
|
|
||||||||||||||||||
Loans to Individuals
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
6
|
|
|
$
|
3
|
|
|
$
|
4
|
|
|
|
—
|
|
|
1
|
|
|
6
|
|
|
3
|
|
|
4
|
|
|||||
Loans on Nonaccrual:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Real Estate Loans
|
|
34,813
|
|
|
1,779
|
|
|
1,980
|
|
|
5,171
|
|
|
3,408
|
|
|||||
Commercial Loans
|
|
639
|
|
|
903
|
|
|
5,477
|
|
|
13,896
|
|
|
416
|
|
|||||
Loans to Individuals
|
|
318
|
|
|
255
|
|
|
823
|
|
|
1,459
|
|
|
272
|
|
|||||
|
|
35,770
|
|
|
2,937
|
|
|
8,280
|
|
|
20,526
|
|
|
4,096
|
|
|||||
Restructured Loans:
(2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Real Estate Loans
|
|
4,389
|
|
|
4,426
|
|
|
5,301
|
|
|
3,045
|
|
|
4,542
|
|
|||||
Commercial Loans
|
|
995
|
|
|
703
|
|
|
464
|
|
|
7,401
|
|
|
595
|
|
|||||
Municipal Loans
|
|
429
|
|
|
502
|
|
|
571
|
|
|
637
|
|
|
699
|
|
|||||
Loans to Individuals
|
|
117
|
|
|
136
|
|
|
95
|
|
|
60
|
|
|
38
|
|
|||||
|
|
5,930
|
|
|
5,767
|
|
|
6,431
|
|
|
11,143
|
|
|
5,874
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total Nonperforming Loans
|
|
41,700
|
|
|
8,705
|
|
|
14,717
|
|
|
31,672
|
|
|
9,974
|
|
|||||
Other Real Estate Owned
|
|
1,206
|
|
|
1,613
|
|
|
339
|
|
|
744
|
|
|
1,738
|
|
|||||
Repossessed Assets
|
|
—
|
|
|
154
|
|
|
49
|
|
|
64
|
|
|
565
|
|
|||||
Total Nonperforming Assets
|
|
$
|
42,906
|
|
|
$
|
10,472
|
|
|
$
|
15,105
|
|
|
$
|
32,480
|
|
|
$
|
12,277
|
|
Nonperforming Assets to Total Assets
|
|
0.70
|
%
|
|
0.16
|
%
|
|
0.27
|
%
|
|
0.63
|
%
|
|
0.26
|
%
|
|||||
Nonperforming Assets to Total Loans
|
|
1.30
|
|
|
0.32
|
|
|
0.59
|
|
|
1.34
|
|
|
0.56
|
|
|||||
Nonaccrual Loans to Total Loans
|
|
1.08
|
|
|
0.09
|
|
|
0.32
|
|
|
0.84
|
|
|
0.19
|
|
(1)
|
Excludes PCI loans measured at fair value at acquisition if the timing and amount of cash flows expected to be collected from those sales can be reasonably estimated.
|
(2)
|
Includes
$3.1 million
,
$2.9 million
,
$3.1 million
and
$7.5 million
of PCI loans restructured during the years ended
December 31, 2018
,
2017
,
2016
and
2015
, respectively.
There were no restructured PCI loans as of December 31, 2014.
|
|
|
December 31, 2018
|
||||||||||
|
|
Recorded Investment
|
|
Related Allowance for Loan Losses
|
|
Carrying
Value
|
||||||
Real Estate Loans
|
|
$
|
40,815
|
|
|
$
|
5,390
|
|
|
$
|
35,425
|
|
Commercial Loans
|
|
2,366
|
|
|
368
|
|
|
1,998
|
|
|||
Municipal Loans
|
|
429
|
|
|
1
|
|
|
428
|
|
|||
Loans to Individuals
|
|
657
|
|
|
149
|
|
|
508
|
|
|||
Total
(1)
|
|
$
|
44,267
|
|
|
$
|
5,908
|
|
|
$
|
38,359
|
|
|
|
December 31, 2017
|
||||||||||
|
|
Recorded Investment
|
|
Related Allowance for Loan Losses
|
|
Carrying
Value
|
||||||
Real Estate Loans
|
|
$
|
5,237
|
|
|
$
|
40
|
|
|
$
|
5,197
|
|
Commercial Loans
|
|
1,605
|
|
|
252
|
|
|
1,353
|
|
|||
Municipal Loans
|
|
502
|
|
|
10
|
|
|
492
|
|
|||
Loans to Individuals
|
|
205
|
|
|
51
|
|
|
154
|
|
|||
Total
(1)
|
|
$
|
7,549
|
|
|
$
|
353
|
|
|
$
|
7,196
|
|
(1)
|
Includes
$8.0 million
and
$2.9 million
of PCI loans that experienced deteriorations in credit quality subsequent to the acquisition date as of
December 31, 2018
and
2017
, respectively.
|
|
|
December 31,
|
||||||||||
Available for Sale:
|
|
2018
|
|
2017
|
|
2016
|
||||||
Investment Securities:
|
|
|
|
|
|
|
||||||
U.S. Treasury
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
70,069
|
|
U.S. Government Agency Debentures
|
|
—
|
|
|
108,869
|
|
|
—
|
|
|||
State and Political Subdivisions
|
|
716,601
|
|
|
392,664
|
|
|
385,197
|
|
|||
Other Stocks and Bonds
|
|
2,709
|
|
|
5,055
|
|
|
6,651
|
|
|||
Other Equity Securities
(1)
|
|
—
|
|
|
5,920
|
|
|
5,920
|
|
|||
Mortgage-backed Securities:
(2)
|
|
|
|
|
|
|
|
|
|
|||
Residential
|
|
732,972
|
|
|
718,029
|
|
|
627,508
|
|
|||
Commercial
|
|
537,154
|
|
|
308,218
|
|
|
384,255
|
|
|||
Total
|
|
$
|
1,989,436
|
|
|
$
|
1,538,755
|
|
|
$
|
1,479,600
|
|
|
|
December 31,
|
||||||||||
Held to Maturity:
|
|
2018
|
|
2017
|
|
2016
|
||||||
Investment Securities:
|
|
|
|
|
|
|
||||||
State and Political Subdivisions
|
|
$
|
3,083
|
|
|
$
|
413,632
|
|
|
$
|
425,810
|
|
Mortgage-backed Securities:
(2)
|
|
|
|
|
|
|
|
|
|
|||
Residential
|
|
59,655
|
|
|
129,044
|
|
|
136,312
|
|
|||
Commercial
|
|
100,193
|
|
|
366,830
|
|
|
375,365
|
|
|||
Total
|
|
$
|
162,931
|
|
|
$
|
909,506
|
|
|
$
|
937,487
|
|
(1)
|
See “Note 1 - Summary of Significant Accounting and Reporting Policies,” for further information.
|
(2)
|
All mortgage-backed securities are issued and/or guaranteed by U.S. government agencies or U.S. government-sponsored enterprises.
|
|
MATURING
|
||||||||||||||||||||||||||
|
Within 1 Year
|
|
After 1 But
Within 5 Years
|
|
After 5 But
Within 10 Years
|
|
After 10 Years
|
||||||||||||||||||||
Available for Sale:
|
Amount
|
|
Yield
|
|
Amount
|
|
Yield
|
|
Amount
|
|
Yield
|
|
Amount
|
|
Yield
|
||||||||||||
Investment Securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
State and Political Subdivisions
|
$
|
3,602
|
|
|
5.70
|
%
|
|
$
|
37,346
|
|
|
3.94
|
%
|
|
$
|
175,181
|
|
|
4.29
|
%
|
|
$
|
500,472
|
|
|
4.43
|
%
|
Other Stocks and Bonds
|
—
|
|
|
—
|
|
|
2,709
|
|
|
4.20
|
%
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Mortgage-backed Securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Residential
|
20
|
|
|
3.15
|
%
|
|
2,301
|
|
|
5.48
|
%
|
|
26,712
|
|
|
3.30
|
%
|
|
703,939
|
|
|
3.24
|
%
|
||||
Commercial
|
—
|
|
|
—
|
|
|
280,979
|
|
|
2.76
|
%
|
|
256,175
|
|
|
2.79
|
%
|
|
—
|
|
|
—
|
|
||||
Total
|
$
|
3,622
|
|
|
5.68
|
%
|
|
$
|
323,335
|
|
|
2.93
|
%
|
|
$
|
458,068
|
|
|
3.39
|
%
|
|
$
|
1,204,411
|
|
|
3.73
|
%
|
|
MATURING
|
||||||||||||||||||||||||||
|
|
|
|
|
After 1 But
|
|
After 5 But
|
|
|
|
|
||||||||||||||||
|
Within 1 Year
|
|
Within 5 Years
|
|
Within 10 Years
|
|
After 10 Years
|
||||||||||||||||||||
Held to Maturity:
|
Amount
|
|
Yield
|
|
Amount
|
|
Yield
|
|
Amount
|
|
Yield
|
|
Amount
|
|
Yield
|
||||||||||||
Investment Securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
State and Political Subdivisions
|
$
|
116
|
|
|
2.04
|
%
|
|
$
|
1,696
|
|
|
2.98
|
%
|
|
$
|
1,271
|
|
|
3.44
|
%
|
|
$
|
—
|
|
|
—
|
|
Mortgage-backed Securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Residential
|
7
|
|
|
3.38
|
%
|
|
235
|
|
|
4.86
|
%
|
|
70
|
|
|
5.85
|
%
|
|
59,343
|
|
|
3.59
|
%
|
||||
Commercial
|
—
|
|
|
—
|
|
|
54,808
|
|
|
2.60
|
%
|
|
35,364
|
|
|
2.86
|
%
|
|
10,021
|
|
|
2.75
|
%
|
||||
Total
|
$
|
123
|
|
|
2.12
|
%
|
|
$
|
56,739
|
|
|
2.62
|
%
|
|
$
|
36,705
|
|
|
2.88
|
%
|
|
$
|
69,364
|
|
|
3.47
|
%
|
|
|
Years Ended December 31,
|
|||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|||||||||||||||
|
|
Average
Balance
|
|
Average
Rate
|
|
Average
Balance
|
|
Average
Rate
|
|
Average
Balance
|
|
Average
Rate
|
|||||||||
|
|
|
|||||||||||||||||||
Interest Bearing Demand Deposits
|
|
$
|
1,978,140
|
|
|
0.85
|
%
|
|
$
|
1,645,557
|
|
|
0.56
|
%
|
|
$
|
1,681,422
|
|
|
0.36
|
%
|
Savings Deposits
|
|
359,509
|
|
|
0.25
|
%
|
|
267,345
|
|
|
0.17
|
%
|
|
244,826
|
|
|
0.11
|
%
|
|||
Time Deposits
|
|
1,160,423
|
|
|
1.56
|
%
|
|
990,553
|
|
|
1.11
|
%
|
|
941,716
|
|
|
0.85
|
%
|
|||
Total Interest Bearing Deposits
|
|
3,498,072
|
|
|
1.03
|
%
|
|
2,903,455
|
|
|
0.71
|
%
|
|
2,867,964
|
|
|
0.50
|
%
|
|||
Noninterest Bearing Demand Deposits
|
|
1,040,447
|
|
|
N/A
|
|
|
761,370
|
|
|
N/A
|
|
|
693,929
|
|
|
N/A
|
|
|||
Total Deposits
|
|
$
|
4,538,519
|
|
|
0.79
|
%
|
|
$
|
3,664,825
|
|
|
0.57
|
%
|
|
$
|
3,561,893
|
|
|
0.40
|
%
|
|
|
December 31,
2018 |
|
December 31, 2017
|
||||
Three months or less
|
|
$
|
194,070
|
|
|
$
|
143,295
|
|
Over three to six months
|
|
113,126
|
|
|
130,344
|
|
||
Over six to twelve months
|
|
159,000
|
|
|
280,064
|
|
||
Over twelve months
|
|
140,221
|
|
|
275,604
|
|
||
Total Time Deposits
|
|
$
|
606,417
|
|
|
$
|
829,307
|
|
|
|
Years Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Federal funds purchased and repurchase agreements:
|
|
|
||||||||||
Balance at end of period
|
|
$
|
36,810
|
|
|
$
|
9,498
|
|
|
$
|
7,097
|
|
Average amount outstanding during the period
(1)
|
|
10,880
|
|
|
8,120
|
|
|
6,798
|
|
|||
Maximum amount outstanding during the period
(2)
|
|
36,810
|
|
|
9,498
|
|
|
11,516
|
|
|||
Weighted average interest rate during the period
(3)
|
|
1.4
|
%
|
|
0.2
|
%
|
|
0.1
|
%
|
|||
Interest rate at end of period
(4)
|
|
2.1
|
%
|
|
0.2
|
%
|
|
0.2
|
%
|
|||
|
|
|
|
|
|
|
||||||
FHLB borrowings:
|
|
|
|
|
|
|
||||||
Balance at end of period
|
|
$
|
719,065
|
|
|
$
|
1,017,361
|
|
|
$
|
1,309,646
|
|
Average amount outstanding during the period
(1)
|
|
720,785
|
|
|
1,222,033
|
|
|
1,060,631
|
|
|||
Maximum amount outstanding during the period
(2)
|
|
957,231
|
|
|
1,414,453
|
|
|
1,309,646
|
|
|||
Weighted average interest rate during the period
(3)
|
|
1.8
|
%
|
|
1.2
|
%
|
|
1.1
|
%
|
|||
Interest rate at end of period
(4)
|
|
2.3
|
%
|
|
1.4
|
%
|
|
0.9
|
%
|
(1)
|
The average amount outstanding during the period was computed by dividing the total daily outstanding principal balances by the number of days in the period.
|
(2)
|
The maximum amount outstanding at any month-end during the period.
|
(3)
|
The weighted average interest rate during the period was computed by dividing the actual interest expense by the average balance outstanding during the period. The weighted average interest rate on the FHLB borrowings include the effect of interest rate swaps.
|
(4)
|
Stated rate.
|
|
|
Actual
|
|
For Capital
Adequacy Purposes
|
|
To Be Well Capitalized
Under Prompt
Corrective Actions
Provisions
|
|||||||||||||||
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|||||||||
December 31, 2018:
|
|
|
|||||||||||||||||||
Common Equity Tier 1 (to Risk Weighted Assets)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Consolidated
|
|
$
|
568,283
|
|
|
14.77
|
%
|
|
$
|
173,174
|
|
|
4.50
|
%
|
|
N/A
|
|
|
N/A
|
|
|
Bank Only
|
|
$
|
714,991
|
|
|
18.59
|
%
|
|
$
|
173,095
|
|
|
4.50
|
%
|
|
$
|
250,026
|
|
|
6.50
|
%
|
Tier 1 Capital (to Risk Weighted Assets)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Consolidated
|
|
$
|
626,718
|
|
|
16.29
|
%
|
|
$
|
230,899
|
|
|
6.00
|
%
|
|
N/A
|
|
|
N/A
|
|
|
Bank Only
|
|
$
|
714,991
|
|
|
18.59
|
%
|
|
$
|
230,793
|
|
|
6.00
|
%
|
|
$
|
307,725
|
|
|
8.00
|
%
|
Total Capital (to Risk Weighted Assets)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Consolidated
|
|
$
|
754,034
|
|
|
19.59
|
%
|
|
$
|
307,865
|
|
|
8.00
|
%
|
|
N/A
|
|
|
N/A
|
|
|
Bank Only
|
|
$
|
743,900
|
|
|
19.34
|
%
|
|
$
|
307,725
|
|
|
8.00
|
%
|
|
$
|
384,656
|
|
|
10.00
|
%
|
Tier 1 Capital (to Average Assets)
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Consolidated
|
|
$
|
626,718
|
|
|
10.64
|
%
|
|
$
|
235,689
|
|
|
4.00
|
%
|
|
N/A
|
|
|
N/A
|
|
|
Bank Only
|
|
$
|
714,991
|
|
|
12.14
|
%
|
|
$
|
235,532
|
|
|
4.00
|
%
|
|
$
|
294,415
|
|
|
5.00
|
%
|
December 31, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Common Equity Tier 1 (to Risk Weighted Assets)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Consolidated
|
|
$
|
570,610
|
|
|
14.65
|
%
|
|
$
|
175,216
|
|
|
4.50
|
%
|
|
N/A
|
|
|
N/A
|
|
|
Bank Only
|
|
$
|
711,157
|
|
|
18.27
|
%
|
|
$
|
175,145
|
|
|
4.50
|
%
|
|
$
|
252,987
|
|
|
6.50
|
%
|
Tier 1 Capital (to Risk Weighted Assets)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Consolidated
|
|
$
|
627,532
|
|
|
16.12
|
%
|
|
$
|
233,621
|
|
|
6.00
|
%
|
|
N/A
|
|
|
N/A
|
|
|
Bank Only
|
|
$
|
711,157
|
|
|
18.27
|
%
|
|
$
|
233,527
|
|
|
6.00
|
%
|
|
$
|
311,369
|
|
|
8.00
|
%
|
Total Capital (to Risk Weighted Assets)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Consolidated
|
|
$
|
748,532
|
|
|
19.22
|
%
|
|
$
|
311,495
|
|
|
8.00
|
%
|
|
N/A
|
|
|
N/A
|
|
|
Bank Only
|
|
$
|
733,909
|
|
|
18.86
|
%
|
|
$
|
311,369
|
|
|
8.00
|
%
|
|
$
|
389,211
|
|
|
10.00
|
%
|
Tier 1 Capital (to Average Assets)
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Consolidated
|
|
$
|
627,532
|
|
|
11.16
|
%
|
|
$
|
224,844
|
|
|
4.00
|
%
|
|
N/A
|
|
|
N/A
|
|
|
Bank Only
|
|
$
|
711,157
|
|
|
12.66
|
%
|
|
$
|
224,741
|
|
|
4.00
|
%
|
|
$
|
280,926
|
|
|
5.00
|
%
|
|
|
Years Ended December 31,
|
|||||||
|
|
2018
|
|
2017
|
|
2016
|
|||
Return on Average Assets
|
|
1.19
|
%
|
|
0.96
|
%
|
|
0.94
|
%
|
Return on Average Shareholders’ Equity
|
|
9.87
|
%
|
|
9.65
|
%
|
|
10.54
|
%
|
Dividend Payout Ratio – Basic
|
|
56.60
|
%
|
|
60.99
|
%
|
|
55.49
|
%
|
Dividend Payout Ratio – Diluted
|
|
56.87
|
%
|
|
61.33
|
%
|
|
55.80
|
%
|
Average Shareholders’ Equity to Average Total Assets
|
|
12.06
|
%
|
|
9.95
|
%
|
|
8.95
|
%
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
Unused commitments:
|
|
|
|
|
|
||
Commitments to extend credit
|
$
|
874,557
|
|
|
$
|
804,715
|
|
Standby letters of credit
|
27,438
|
|
|
14,890
|
|
||
Total
|
$
|
901,995
|
|
|
$
|
819,605
|
|
|
|
Payments Due By Period
|
||||||||||||||||||
|
|
Less than 1 Year
|
|
1-3
Years
|
|
3-5
Years
|
|
More than 5 Years
|
|
Total
|
||||||||||
Contractual obligations:
|
|
|
||||||||||||||||||
FHLB borrowings
|
|
$
|
336,502
|
|
|
$
|
376,648
|
|
|
$
|
—
|
|
|
$
|
5,915
|
|
|
$
|
719,065
|
|
Subordinated notes
(1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
100,000
|
|
|
100,000
|
|
|||||
Trust preferred subordinated debentures
(1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
60,311
|
|
|
60,311
|
|
|||||
Operating leases
(2)
|
|
1,265
|
|
|
2,064
|
|
|
1,302
|
|
|
1,352
|
|
|
5,983
|
|
|||||
Deferred compensation agreements
(3)
|
|
386,004
|
|
|
849,508
|
|
|
944,341
|
|
|
4,724,179
|
|
|
6,904,032
|
|
|||||
Time deposits
|
|
845,661
|
|
|
158,796
|
|
|
45,934
|
|
|
5,180
|
|
|
1,055,571
|
|
|||||
Unsettled trades to purchase securities
|
|
6,378
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,378
|
|
|||||
Total contractual obligations
|
|
$
|
1,575,810
|
|
|
$
|
1,387,016
|
|
|
$
|
991,577
|
|
|
$
|
4,896,937
|
|
|
$
|
8,851,340
|
|
(1)
|
Subordinated notes, net of unamortized debt issuance costs, were
$98.4 million
at
December 31, 2018
. Trust preferred subordinated debentures, net of unamortized debt issuance costs, were
$60.2 million
at
December 31, 2018
. See “Note 10 - Long-Term Debt” for further information.
|
(2)
|
See “Note 17 - Off-Balance-Sheet Arrangements, Commitments and Contingencies” for further information.
|
(3)
|
See “Note 11 - Employee Benefits” for further information.
|
INDEX
|
||
|
|
|
Report of Independent Registered Accounting Firm
|
|
|
|
|
|
CONSOLIDATED FINANCIAL STATEMENTS
|
|
|
Consolidated Balance Sheets as of December 31, 2018 and 2017
|
|
|
Consolidated Statements of Income for the years ended December 31, 2018, 2017 and 2016
|
|
|
Consolidated Statements of Comprehensive Income for the years ended December 31, 2018, 2017 and 2016
|
|
|
Consolidated Statements of Changes in Shareholders’ Equity for the years ended December 31, 2018, 2017 and 2016
|
|
|
Consolidated Statements of Cash Flows for the years ended December 31, 2018, 2017 and 2016
|
|
|
Notes to Consolidated Financial Statements
|
|
|
|
|
|
SOUTHSIDE BANCSHARES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (in thousands, except share amounts) |
||||||||
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
|
|
|||||||
ASSETS
|
|
|
|
|
||||
Cash and due from banks
|
|
$
|
87,375
|
|
|
$
|
79,171
|
|
Interest earning deposits
|
|
23,884
|
|
|
111,541
|
|
||
Federal funds sold
|
|
9,460
|
|
|
7,980
|
|
||
Total cash and cash equivalents
|
|
120,719
|
|
|
198,692
|
|
||
Securities available for sale, at estimated fair value
|
|
1,989,436
|
|
|
1,538,755
|
|
||
Securities held to maturity, at carrying value (estimated fair value of $159,781 and $921,800, respectively)
|
|
162,931
|
|
|
909,506
|
|
||
FHLB stock, at cost
|
|
32,583
|
|
|
55,729
|
|
||
Equity investments
|
|
12,093
|
|
|
5,821
|
|
||
Loans held for sale
|
|
601
|
|
|
2,001
|
|
||
Loans:
|
|
|
|
|
|
|
||
Loans
|
|
3,312,799
|
|
|
3,294,356
|
|
||
Less: Allowance for loan losses
|
|
(27,019
|
)
|
|
(20,781
|
)
|
||
Net loans
|
|
3,285,780
|
|
|
3,273,575
|
|
||
Premises and equipment, net
|
|
135,972
|
|
|
133,640
|
|
||
Goodwill
|
|
201,116
|
|
|
201,246
|
|
||
Other intangible assets, net
|
|
17,779
|
|
|
22,993
|
|
||
Interest receivable
|
|
27,287
|
|
|
28,491
|
|
||
Deferred tax asset, net
|
|
9,776
|
|
|
12,204
|
|
||
Unsettled issuances of brokered certificates of deposit
|
|
15,236
|
|
|
—
|
|
||
Bank owned life insurance
|
|
98,160
|
|
|
100,368
|
|
||
Other assets
|
|
14,025
|
|
|
15,076
|
|
||
Total assets
|
|
$
|
6,123,494
|
|
|
$
|
6,498,097
|
|
|
|
|
|
|
|
|
||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
||
Deposits:
|
|
|
|
|
|
|
||
Noninterest bearing
|
|
$
|
994,680
|
|
|
$
|
1,037,401
|
|
Interest bearing
|
|
3,430,350
|
|
|
3,478,046
|
|
||
Total deposits
|
|
4,425,030
|
|
|
4,515,447
|
|
||
Federal funds purchased and repurchase agreements
|
|
36,810
|
|
|
9,498
|
|
||
FHLB borrowings
|
|
719,065
|
|
|
1,017,361
|
|
||
Subordinated notes, net of unamortized debt issuance costs
|
|
98,407
|
|
|
98,248
|
|
||
Trust preferred subordinated debentures, net of unamortized debt issuance costs
|
|
60,246
|
|
|
60,241
|
|
||
Unsettled trades to purchase securities
|
|
6,378
|
|
|
—
|
|
||
Other liabilities
|
|
46,267
|
|
|
43,162
|
|
||
Total liabilities
|
|
5,392,203
|
|
|
5,743,957
|
|
||
|
|
|
|
|
|
|
||
Off-balance-sheet arrangements, commitments and contingencies (Note 17)
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|||
Shareholders’ equity:
|
|
|
|
|
|
|
||
Common stock: ($1.25 par value, 80,000,000 shares authorized and 37,845,224 shares issued at December 31, 2018 and 40,000,000 shares authorized and 37,802,352 shares issued at December 31, 2017)
|
|
47,307
|
|
|
47,253
|
|
||
Paid-in capital
|
|
762,470
|
|
|
757,439
|
|
||
Retained earnings
|
|
64,797
|
|
|
32,851
|
|
||
Treasury stock, at cost (4,120,475 at December 31, 2018 and 2,802,019 at December 31, 2017)
|
|
(93,055
|
)
|
|
(47,105
|
)
|
||
Accumulated other comprehensive loss
|
|
(50,228
|
)
|
|
(36,298
|
)
|
||
Total shareholders’ equity
|
|
731,291
|
|
|
754,140
|
|
||
Total liabilities and shareholders’ equity
|
|
$
|
6,123,494
|
|
|
$
|
6,498,097
|
|
SOUTHSIDE BANCSHARES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
|
||||||||||||
|
|
Years Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Interest income
|
|
|
|
|
|
|
||||||
Loans
|
|
$
|
158,691
|
|
|
$
|
117,633
|
|
|
$
|
106,564
|
|
Investment securities – taxable
|
|
417
|
|
|
939
|
|
|
1,057
|
|
|||
Investment securities – tax-exempt
|
|
24,960
|
|
|
24,529
|
|
|
22,654
|
|
|||
Mortgage-backed securities
|
|
41,584
|
|
|
41,361
|
|
|
37,450
|
|
|||
FHLB stock and equity investments
|
|
1,595
|
|
|
1,306
|
|
|
798
|
|
|||
Other interest earning assets
|
|
1,918
|
|
|
1,706
|
|
|
390
|
|
|||
Total interest income
|
|
229,165
|
|
|
187,474
|
|
|
168,913
|
|
|||
Interest expense
|
|
|
|
|
|
|
|
|
|
|||
Deposits
|
|
35,864
|
|
|
20,736
|
|
|
14,255
|
|
|||
FHLB borrowings
|
|
12,813
|
|
|
15,106
|
|
|
11,751
|
|
|||
Subordinated notes
|
|
5,659
|
|
|
5,633
|
|
|
1,628
|
|
|||
Trust preferred subordinated debentures
|
|
2,610
|
|
|
2,013
|
|
|
1,706
|
|
|||
Other borrowings
|
|
155
|
|
|
16
|
|
|
8
|
|
|||
Total interest expense
|
|
57,101
|
|
|
43,504
|
|
|
29,348
|
|
|||
Net interest income
|
|
172,064
|
|
|
143,970
|
|
|
139,565
|
|
|||
Provision for loan losses
|
|
8,437
|
|
|
4,675
|
|
|
9,780
|
|
|||
Net interest income after provision for loan losses
|
|
163,627
|
|
|
139,295
|
|
|
129,785
|
|
|||
Noninterest income
|
|
|
|
|
|
|
|
|
|
|||
Deposit services
|
|
25,082
|
|
|
21,785
|
|
|
20,702
|
|
|||
Net (loss) gain on sale of securities available for sale
|
|
(1,839
|
)
|
|
625
|
|
|
2,836
|
|
|||
Gain on sale of loans
|
|
692
|
|
|
1,821
|
|
|
2,795
|
|
|||
Trust income
|
|
6,832
|
|
|
3,818
|
|
|
3,491
|
|
|||
Bank owned life insurance income
|
|
2,923
|
|
|
2,537
|
|
|
2,626
|
|
|||
Brokerage services
|
|
1,987
|
|
|
2,422
|
|
|
2,127
|
|
|||
Other
|
|
5,096
|
|
|
4,465
|
|
|
4,834
|
|
|||
Total noninterest income
|
|
40,773
|
|
|
37,473
|
|
|
39,411
|
|
|||
Noninterest expense
|
|
|
|
|
|
|
|
|
|
|||
Salaries and employee benefits
|
|
70,643
|
|
|
60,779
|
|
|
61,628
|
|
|||
Occupancy expense
|
|
13,814
|
|
|
12,068
|
|
|
13,722
|
|
|||
Acquisition expense
|
|
2,413
|
|
|
4,352
|
|
|
—
|
|
|||
Advertising, travel & entertainment
|
|
2,894
|
|
|
2,219
|
|
|
2,643
|
|
|||
ATM and debit card expense
|
|
1,090
|
|
|
3,889
|
|
|
3,136
|
|
|||
Professional fees
|
|
4,035
|
|
|
3,844
|
|
|
4,946
|
|
|||
Software and data processing expense
|
|
3,996
|
|
|
3,027
|
|
|
2,911
|
|
|||
Telephone and communications
|
|
1,847
|
|
|
1,905
|
|
|
1,931
|
|
|||
FDIC insurance
|
|
1,871
|
|
|
1,769
|
|
|
2,141
|
|
|||
Amortization expense on intangibles
|
|
5,213
|
|
|
1,955
|
|
|
1,940
|
|
|||
Other
|
|
12,283
|
|
|
10,528
|
|
|
14,524
|
|
|||
Total noninterest expense
|
|
120,099
|
|
|
106,335
|
|
|
109,522
|
|
|||
Income before income tax expense
|
|
84,301
|
|
|
70,433
|
|
|
59,674
|
|
|||
Income tax expense
|
|
10,163
|
|
|
16,121
|
|
|
10,325
|
|
|||
Net income
|
|
$
|
74,138
|
|
|
$
|
54,312
|
|
|
$
|
49,349
|
|
|
|
|
|
|
|
|
||||||
Earnings per common share – basic
|
|
$
|
2.12
|
|
|
$
|
1.82
|
|
|
$
|
1.82
|
|
Earnings per common share – diluted
|
|
$
|
2.11
|
|
|
$
|
1.81
|
|
|
$
|
1.81
|
|
Cash dividends paid per common share
|
|
$
|
1.20
|
|
|
$
|
1.11
|
|
|
$
|
1.01
|
|
SOUTHSIDE BANCSHARES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in thousands)
|
|||||||||||
|
Years Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Net income
|
$
|
74,138
|
|
|
$
|
54,312
|
|
|
$
|
49,349
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|||
Securities available for sale and transferred securities:
|
|
|
|
|
|
||||||
Change in unrealized (loss) gain on available for sale securities during the period
|
(34,238
|
)
|
|
15,217
|
|
|
(23,459
|
)
|
|||
Unrealized net gain on securities transferred from held to maturity to available for sale under the transition guidance enumerated in ASU 2017-12
|
11,881
|
|
|
—
|
|
|
—
|
|
|||
Change in net unrealized loss on securities transferred from held to maturity to available for sale
|
401
|
|
|
—
|
|
|
—
|
|
|||
Change in net unrealized loss on securities transferred to held to maturity
|
—
|
|
|
—
|
|
|
(10,240
|
)
|
|||
Reclassification adjustment for net loss on equity investments, reclassified to retained earnings with adoption of ASU 2016-01
|
107
|
|
|
—
|
|
|
—
|
|
|||
Reclassification adjustment for amortization related to available for sale and to held to maturity debt securities
|
1,244
|
|
|
1,255
|
|
|
429
|
|
|||
Reclassification adjustment for net loss (gain) on sale of available for sale securities, included in net income
|
1,839
|
|
|
(625
|
)
|
|
(2,836
|
)
|
|||
Derivatives:
|
|
|
|
|
|
||||||
Change in unrealized gain on effective cash flow hedge interest rate swap derivatives
|
2,351
|
|
|
3
|
|
|
5,255
|
|
|||
Change in net unrealized gains on interest rate swap derivatives terminated during the period
|
—
|
|
|
273
|
|
|
—
|
|
|||
Reclassification adjustment from other comprehensive income (loss) related to derivatives designated as cash flow hedge
|
(1,406
|
)
|
|
754
|
|
|
1,815
|
|
|||
Pension plans:
|
|
|
|
|
|
||||||
Amortization of net actuarial loss and prior service credit, included in net periodic benefit cost
|
2,182
|
|
|
1,605
|
|
|
1,820
|
|
|||
Effect of settlement recognition
|
—
|
|
|
8
|
|
|
(8
|
)
|
|||
Prior service cost adjustment due to plan amendments
|
—
|
|
|
—
|
|
|
(121
|
)
|
|||
Change in net actuarial loss
|
(1,994
|
)
|
|
(5,218
|
)
|
|
(3,132
|
)
|
|||
Other comprehensive (loss) income, before tax
|
(17,633
|
)
|
|
13,272
|
|
|
(30,477
|
)
|
|||
Income tax benefit (expense) related to items of other comprehensive income (loss)
|
3,703
|
|
|
(5,374
|
)
|
|
10,667
|
|
|||
Other comprehensive (loss) income, net of tax
|
(13,930
|
)
|
|
7,898
|
|
|
(19,810
|
)
|
|||
Comprehensive income
|
$
|
60,208
|
|
|
$
|
62,210
|
|
|
$
|
29,539
|
|
SOUTHSIDE BANCSHARES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
(in thousands, except share amounts)
|
|||||||||||||||||||||||||||||
|
|
Common
Stock
|
|
Paid In
Capital
|
|
Retained
Earnings
|
|
Treasury
Stock
|
|
Accumulated
Other Comprehensive Income (Loss) |
|
Total Shareholders’
Equity
|
|||||||||||||||||
Balance at December 31, 2015
|
|
$
|
34,832
|
|
|
$
|
424,078
|
|
|
$
|
41,527
|
|
|
$
|
(37,692
|
)
|
|
$
|
(18,683
|
)
|
|
$
|
444,062
|
|
|||||
Net Income
|
|
—
|
|
|
—
|
|
|
49,349
|
|
|
—
|
|
|
—
|
|
|
49,349
|
|
|||||||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(19,810
|
)
|
|
(19,810
|
)
|
|||||||||||
Issuance of common stock for dividend reinvestment plan (44,575 shares)
|
|
56
|
|
|
1,355
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,411
|
|
|||||||||||
Net issuance of common stock (2,185,000 shares)
|
|
2,731
|
|
|
73,261
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
75,992
|
|
|||||||||||
Purchase of common stock (443,426 shares)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,199
|
)
|
|
—
|
|
|
(10,199
|
)
|
|||||||||||
Stock compensation expense
|
|
—
|
|
|
1,541
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,541
|
|
|||||||||||
Tax benefit related to stock awards
|
|
—
|
|
|
332
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
332
|
|
|||||||||||
Net issuance of common stock under employee stock plans (108,225 shares)
|
|
136
|
|
|
1,473
|
|
|
(50
|
)
|
|
—
|
|
|
—
|
|
|
1,559
|
|
|||||||||||
Cash dividends paid on common stock ($1.01 per share)
|
|
—
|
|
|
—
|
|
|
(25,963
|
)
|
|
—
|
|
|
—
|
|
|
(25,963
|
)
|
|||||||||||
Stock dividend declared (1,252,353 shares)
|
|
1,565
|
|
|
33,200
|
|
|
(34,765
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||||
Balance at December 31, 2016
|
|
39,320
|
|
|
535,240
|
|
|
30,098
|
|
|
(47,891
|
)
|
|
(38,493
|
)
|
|
518,274
|
|
|||||||||||
Net Income
|
|
—
|
|
|
—
|
|
|
54,312
|
|
|
—
|
|
|
—
|
|
|
54,312
|
|
|||||||||||
Other comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,898
|
|
|
7,898
|
|
|||||||||||
Issuance of common stock for dividend reinvestment plan (43,650 shares)
|
|
54
|
|
|
1,429
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,483
|
|
|||||||||||
Net issuance of common stock in connection with the acquisition of Diboll State Bancshares, Inc. (5,534,925 shares)
|
|
6,919
|
|
|
193,168
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
200,087
|
|
|||||||||||
Stock compensation expense
|
|
—
|
|
|
1,815
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,815
|
|
|||||||||||
Net issuance of common stock under employee stock plans (159,356 shares)
|
|
61
|
|
|
1,726
|
|
|
(103
|
)
|
|
786
|
|
|
—
|
|
|
2,470
|
|
|||||||||||
Cash dividends paid on common stock ($1.11 per share)
|
|
—
|
|
|
—
|
|
|
(32,199
|
)
|
|
—
|
|
|
—
|
|
|
(32,199
|
)
|
|||||||||||
Stock dividend declared (719,515 shares)
|
|
899
|
|
|
24,061
|
|
|
(24,960
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||||
Reclassification of certain deferred tax effects
|
|
—
|
|
|
—
|
|
|
5,703
|
|
|
—
|
|
|
(5,703
|
)
|
|
—
|
|
|||||||||||
Balance at December 31, 2017
|
|
47,253
|
|
|
757,439
|
|
|
32,851
|
|
|
(47,105
|
)
|
|
(36,298
|
)
|
|
754,140
|
|
|||||||||||
Net Income
|
|
—
|
|
|
—
|
|
|
74,138
|
|
|
—
|
|
|
—
|
|
|
74,138
|
|
|||||||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(13,930
|
)
|
|
(13,930
|
)
|
|||||||||||
Issuance of common stock for dividend reinvestment plan (42,872 shares)
|
|
54
|
|
|
1,424
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,478
|
|
|||||||||||
Purchase of common stock (1,459,148 shares)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(47,193
|
)
|
|
—
|
|
|
(47,193
|
)
|
|||||||||||
Stock compensation expense
|
|
—
|
|
|
2,317
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,317
|
|
|||||||||||
Net issuance of common stock under employee stock plans (140,692 shares)
|
|
—
|
|
|
1,290
|
|
|
(128
|
)
|
|
1,243
|
|
|
—
|
|
|
2,405
|
|
|||||||||||
Cash dividends paid on common stock ($1.20 per share)
|
|
—
|
|
|
—
|
|
|
(41,979
|
)
|
|
—
|
|
|
—
|
|
|
(41,979
|
)
|
|||||||||||
Cumulative effect of ASU 2016-01
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(85
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
|
(85
|
)
|
||||||
Balance at December 31, 2018
|
|
$
|
47,307
|
|
|
$
|
762,470
|
|
|
$
|
64,797
|
|
|
$
|
(93,055
|
)
|
|
$
|
(50,228
|
)
|
|
$
|
731,291
|
|
|
|
Years Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
OPERATING ACTIVITIES:
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
74,138
|
|
|
$
|
54,312
|
|
|
$
|
49,349
|
|
Adjustments to reconcile net income to net cash provided by operations:
|
|
|
|
|
|
|
|
|
|
|||
Depreciation and net amortization
|
|
14,045
|
|
|
10,208
|
|
|
9,084
|
|
|||
Securities premium amortization (discount accretion), net
|
|
13,675
|
|
|
17,639
|
|
|
19,126
|
|
|||
Loan (discount accretion) premium amortization, net
|
|
(2,333
|
)
|
|
(1,142
|
)
|
|
(2,520
|
)
|
|||
Provision for loan losses
|
|
8,437
|
|
|
4,675
|
|
|
9,780
|
|
|||
Stock compensation expense
|
|
2,317
|
|
|
1,815
|
|
|
1,541
|
|
|||
Deferred tax expense
|
|
6,154
|
|
|
3,514
|
|
|
1,768
|
|
|||
Net tax benefit related to stock awards
|
|
—
|
|
|
—
|
|
|
(332
|
)
|
|||
Net loss (gain) on sale of securities available for sale
|
|
1,839
|
|
|
(625
|
)
|
|
(2,836
|
)
|
|||
Net loss on premises and equipment
|
|
768
|
|
|
152
|
|
|
376
|
|
|||
Gross proceeds from sales of loans held for sale
|
|
24,092
|
|
|
58,747
|
|
|
82,062
|
|
|||
Gross originations of loans held for sale
|
|
(22,692
|
)
|
|
(53,107
|
)
|
|
(85,892
|
)
|
|||
Net loss on other real estate owned
|
|
433
|
|
|
7
|
|
|
219
|
|
|||
Net gain on sale of customer receivables
|
|
(124
|
)
|
|
—
|
|
|
(194
|
)
|
|||
Net change in:
|
|
|
|
|
|
|
|
|
|
|||
Interest receivable
|
|
1,204
|
|
|
(63
|
)
|
|
(2,483
|
)
|
|||
Other assets
|
|
(2,166
|
)
|
|
(3,909
|
)
|
|
1,823
|
|
|||
Interest payable
|
|
1,257
|
|
|
570
|
|
|
2,334
|
|
|||
Other liabilities
|
|
1,358
|
|
|
(1,063
|
)
|
|
3,520
|
|
|||
Net cash provided by operating activities
|
|
122,402
|
|
|
91,730
|
|
|
86,725
|
|
|||
|
|
|
|
|
|
|
||||||
INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
|||
Securities available for sale:
|
|
|
|
|
|
|
|
|
||||
Purchases
|
|
(306,867
|
)
|
|
(619,398
|
)
|
|
(1,001,742
|
)
|
|||
Sales
|
|
428,518
|
|
|
685,152
|
|
|
573,051
|
|
|||
Maturities, calls and principal repayments
|
|
137,883
|
|
|
113,183
|
|
|
207,500
|
|
|||
Securities held to maturity:
|
|
|
|
|
|
|
|
|
|
|||
Purchases
|
|
—
|
|
|
(6,260
|
)
|
|
(44,656
|
)
|
|||
Maturities, calls and principal repayments
|
|
3,064
|
|
|
28,974
|
|
|
31,251
|
|
|||
Proceeds from redemption of FHLB stock and other investments
|
|
24,360
|
|
|
6,945
|
|
|
3,644
|
|
|||
Purchases of FHLB stock and other investments
|
|
(1,518
|
)
|
|
(1,233
|
)
|
|
(13,667
|
)
|
|||
Net loan originations
|
|
(24,491
|
)
|
|
(117,750
|
)
|
|
(139,607
|
)
|
|||
Proceeds from sales of customer receivables
|
|
4,300
|
|
|
—
|
|
|
3,325
|
|
|||
Net cash and cash equivalents acquired in acquisition
|
|
—
|
|
|
115,598
|
|
|
—
|
|
|||
Net cash paid in acquisition
|
|
—
|
|
|
(23,941
|
)
|
|
—
|
|
|||
Purchases of premises and equipment
|
|
(13,444
|
)
|
|
(9,633
|
)
|
|
(6,549
|
)
|
|||
Proceeds from bank owned life insurance
|
|
5,956
|
|
|
—
|
|
|
—
|
|
|||
Proceeds from sales of premises and equipment
|
|
1,943
|
|
|
12
|
|
|
128
|
|
|||
Proceeds from sales of other real estate owned
|
|
1,717
|
|
|
659
|
|
|
2,024
|
|
|||
Proceeds from sales of repossessed assets
|
|
483
|
|
|
429
|
|
|
894
|
|
|||
Net cash provided by (used in) investing activities
|
|
261,904
|
|
|
172,737
|
|
|
(384,404
|
)
|
|||
|
|
|
|
|
|
|
||||||
(continued)
|
|
|
|
|
|
|
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
Southside Bancshares, Inc. and Subsidiaries
|
•
|
Deposit services
. Service charges on deposit accounts include fees for banking services provided, overdrafts and non-sufficient funds. Revenue is generally recognized in accordance with published deposit account agreements for retail accounts or contractual agreements for commercial accounts. Our deposit services also include our ATM and debit card interchange revenue that is presented net of the associated costs. Interchange revenue is generated by our deposit customers’ usage and volume of activity. Interchange rates are not controlled by the Company, which effectively acts as processor that collects and remits payments associated with customer debit card transactions.
|
•
|
Trust income.
Trust income includes fees and commissions from investment management, administrative and advisory services primarily for individuals, and to a lesser extent, partnerships and corporations. Revenue is recognized on an accrual basis at the time the services are performed and when we have a right to invoice and are based on either the market value of the assets managed or the services provided.
|
•
|
Brokerage services.
Brokerage services income includes fees and commissions charged when we arrange for another party to transfer brokerage services to a customer. The fees and commissions under this agent relationship are based upon stated fee schedules based upon the type of transaction, volume and value of the services provided.
|
•
|
Other noninterest income
. Other noninterest income includes among other things, merchant services income. Merchant services revenue is derived from third party vendors that process credit card transactions on behalf of our merchant customers. Merchant services revenue is primarily comprised of residual fee income based on the referred merchant’s processing volumes and/or margin.
|
|
|
Goodwill
|
||
Balance as of December 31, 2017
|
|
$
|
201,246
|
|
Less: measurement period adjustments
|
|
(130
|
)
|
|
Balance as of December 31, 2018
|
|
$
|
201,116
|
|
|
As Originally Reported
(1)
|
|
Measurement Period Adjustments
|
|
Adjusted Balances
|
||||||
Cash, cash equivalents and amounts due from banks
|
$
|
115,598
|
|
|
$
|
—
|
|
|
$
|
115,598
|
|
Other investments
|
610
|
|
|
—
|
|
|
610
|
|
|||
Securities available for sale
|
234,447
|
|
|
—
|
|
|
234,447
|
|
|||
Loans
|
621,318
|
|
|
—
|
|
|
621,318
|
|
|||
Property and equipment
|
26,256
|
|
|
—
|
|
|
26,256
|
|
|||
Other assets
|
7,052
|
|
|
—
|
|
|
7,052
|
|
|||
Core deposit intangible
|
14,700
|
|
|
—
|
|
|
14,700
|
|
|||
Trust relationship intangible
|
5,400
|
|
|
—
|
|
|
5,400
|
|
|||
Goodwill
|
109,726
|
|
|
(130
|
)
|
|
109,596
|
|
|||
Deposits
|
(899,307
|
)
|
|
—
|
|
|
(899,307
|
)
|
|||
Deferred tax liability, net
|
(7,802
|
)
|
|
84
|
|
|
(7,718
|
)
|
|||
Other liabilities
|
(3,693
|
)
|
|
46
|
|
|
(3,647
|
)
|
|||
|
$
|
224,305
|
|
|
$
|
—
|
|
|
$
|
224,305
|
|
(1)
|
The estimated fair value as of the acquisition date,
November 30, 2017
, as previously reported in our Form 10-K for the year ended
December 31, 2017
.
|
|
Purchased Credit Impaired Loans at Acquisition Date
|
||
Contractually required principal and interest payments
|
$
|
59,286
|
|
Nonaccretable difference
|
4,560
|
|
|
Cash flows expected to be collected
|
54,726
|
|
|
Accretable difference
|
15,389
|
|
|
Fair value of loans acquired with a deterioration of credit quality
|
$
|
39,337
|
|
|
Fair Value at Acquisition Date
|
|
Contractual Amounts Receivable
|
|
Cash Flows Not Expected to be Collected at Acquisition Date
(1)
|
||||||
Real Estate Loans:
|
|
|
|
|
|
||||||
Construction
|
$
|
40,122
|
|
|
$
|
56,905
|
|
|
$
|
330
|
|
1-4 Family Residential
|
82,654
|
|
|
130,167
|
|
|
26,894
|
|
|||
Commercial
|
319,623
|
|
|
484,529
|
|
|
97,431
|
|
|||
Commercial Loans
|
82,083
|
|
|
87,688
|
|
|
1,226
|
|
|||
Municipal Loans
|
7,848
|
|
|
9,998
|
|
|
28
|
|
|||
Loans to Individuals
|
49,651
|
|
|
54,687
|
|
|
1,490
|
|
|||
Total Loans
|
$
|
581,981
|
|
|
$
|
823,974
|
|
|
$
|
127,399
|
|
(1)
|
Cash flows not expected to be collected relate to estimated credit losses and expected prepayments.
|
|
|
Years Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Basic and Diluted Earnings:
|
|
|
|
|
|
|
||||||
Net Income
|
|
$
|
74,138
|
|
|
$
|
54,312
|
|
|
$
|
49,349
|
|
Basic weighted-average shares outstanding
|
|
34,951
|
|
|
29,841
|
|
|
27,118
|
|
|||
Add: Stock awards
|
|
165
|
|
|
206
|
|
|
129
|
|
|||
Diluted weighted-average shares outstanding
|
|
35,116
|
|
|
30,047
|
|
|
27,247
|
|
|||
Basic Earnings Per Share:
|
|
|
|
|
|
|
|
|
|
|||
Net Income
|
|
$
|
2.12
|
|
|
$
|
1.82
|
|
|
$
|
1.82
|
|
Diluted Earnings Per Share:
|
|
|
|
|
|
|
|
|
|
|||
Net Income
|
|
$
|
2.11
|
|
|
$
|
1.81
|
|
|
$
|
1.81
|
|
|
Year Ended December 31, 2018
|
||||||||||||||||||
|
|
|
|
|
Pension Plans
|
|
|
||||||||||||
|
Unrealized Gains (Losses) on Securities
|
|
Unrealized Gains (Losses) on Derivatives
|
|
Net Prior
Service (Cost) Credit |
|
Net Gain (Loss)
|
|
Total
|
||||||||||
Beginning balance, net of tax
|
$
|
(16,295
|
)
|
|
$
|
6,399
|
|
|
$
|
(133
|
)
|
|
$
|
(26,269
|
)
|
|
$
|
(36,298
|
)
|
Other comprehensive (loss) income:
|
|
|
|
|
|
|
|
|
|
||||||||||
Other comprehensive (loss) income before reclassifications
|
(21,956
|
)
|
|
2,351
|
|
|
—
|
|
|
(1,994
|
)
|
|
(21,599
|
)
|
|||||
Reclassified from accumulated other comprehensive income
(1)
|
3,190
|
|
|
(1,406
|
)
|
|
(7
|
)
|
|
2,189
|
|
|
3,966
|
|
|||||
Income tax benefit (expense)
|
3,941
|
|
|
(198
|
)
|
|
1
|
|
|
(41
|
)
|
|
3,703
|
|
|||||
Net current-period other comprehensive (loss) income, net of tax
|
(14,825
|
)
|
|
747
|
|
|
(6
|
)
|
|
154
|
|
|
(13,930
|
)
|
|||||
Ending balance, net of tax
|
$
|
(31,120
|
)
|
|
$
|
7,146
|
|
|
$
|
(139
|
)
|
|
$
|
(26,115
|
)
|
|
$
|
(50,228
|
)
|
|
Year Ended December 31, 2017
|
||||||||||||||||||
|
|
|
|
|
Pension Plans
|
|
|
||||||||||||
|
Unrealized Gains (Losses) on Securities
|
|
Unrealized Gains (Losses) on Derivatives
|
|
Net Prior
Service (Cost) Credit |
|
Net Gain (Loss)
|
|
Total
|
||||||||||
Beginning balance, net of tax
|
$
|
(23,708
|
)
|
|
$
|
4,595
|
|
|
$
|
(133
|
)
|
|
$
|
(19,247
|
)
|
|
$
|
(38,493
|
)
|
Other comprehensive (loss) income:
|
|
|
|
|
|
|
|
|
|
||||||||||
Other comprehensive income (loss) before reclassifications
|
15,217
|
|
|
276
|
|
|
8
|
|
|
(5,218
|
)
|
|
10,283
|
|
|||||
Reclassified from accumulated other comprehensive income
|
630
|
|
|
754
|
|
|
(8
|
)
|
|
1,613
|
|
|
2,989
|
|
|||||
Income tax (expense) benefit
|
(5,546
|
)
|
|
(360
|
)
|
|
—
|
|
|
532
|
|
|
(5,374
|
)
|
|||||
Net current-period other comprehensive income (loss), net of tax
|
10,301
|
|
|
670
|
|
|
—
|
|
|
(3,073
|
)
|
|
7,898
|
|
|||||
Reclassification of certain deferred tax effects
(2)
|
(2,888
|
)
|
|
1,134
|
|
|
—
|
|
|
(3,949
|
)
|
|
(5,703
|
)
|
|||||
Ending balance, net of tax
|
$
|
(16,295
|
)
|
|
$
|
6,399
|
|
|
$
|
(133
|
)
|
|
$
|
(26,269
|
)
|
|
$
|
(36,298
|
)
|
(1)
|
As discussed in “Note 1 – Summary of Significant Accounting and Reporting Policies,” the Company adopted ASU 2016-01 on January 1, 2018. This amount includes a reclassification for the cumulative adjustment to retained earnings of
$107,000
(
$85,000
, net of tax).
|
(2)
|
Amounts reclassified to retained earnings due to early adoption of ASU 2018-02. See “Note 1 – Summary of Significant Accounting and Reporting Policies” for further information.
|
|
Year Ended December 31, 2016
|
||||||||||||||||||
|
|
|
|
|
Pension Plans
|
|
|
||||||||||||
|
Unrealized Gains (Losses) on Securities
|
|
Unrealized Gains (Losses) on Derivatives
|
|
Net Prior
Service (Cost) Credit |
|
Net Gain (Loss)
|
|
Total
|
||||||||||
Beginning balance, net of tax
|
$
|
(239
|
)
|
|
$
|
—
|
|
|
$
|
(44
|
)
|
|
$
|
(18,400
|
)
|
|
$
|
(18,683
|
)
|
Other comprehensive (loss) income:
|
|
|
|
|
|
|
|
|
|
||||||||||
Other comprehensive (loss) income before reclassifications
|
(33,699
|
)
|
|
5,255
|
|
|
(129
|
)
|
|
(3,132
|
)
|
|
(31,705
|
)
|
|||||
Reclassified from accumulated other comprehensive income
|
(2,407
|
)
|
|
1,815
|
|
|
(8
|
)
|
|
1,828
|
|
|
1,228
|
|
|||||
Income tax benefit (expense)
|
12,637
|
|
|
(2,475
|
)
|
|
48
|
|
|
457
|
|
|
10,667
|
|
|||||
Net current-period other comprehensive (loss) income, net of tax
|
(23,469
|
)
|
|
4,595
|
|
|
(89
|
)
|
|
(847
|
)
|
|
(19,810
|
)
|
|||||
Ending balance, net of tax
|
$
|
(23,708
|
)
|
|
$
|
4,595
|
|
|
$
|
(133
|
)
|
|
$
|
(19,247
|
)
|
|
$
|
(38,493
|
)
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Unrealized losses on securities transferred:
|
|
|
|
|
|
|
||||||
Amortization of unrealized losses
(1)
|
|
$
|
(1,244
|
)
|
|
$
|
(1,255
|
)
|
|
$
|
(429
|
)
|
Tax benefit
|
|
261
|
|
|
439
|
|
|
150
|
|
|||
Net of tax
|
|
$
|
(983
|
)
|
|
$
|
(816
|
)
|
|
$
|
(279
|
)
|
|
|
|
|
|
|
|
||||||
Unrealized gains and losses on available for sale securities:
|
|
|
|
|
|
|
||||||
Realized net (loss) gain on sale of securities
(2)
|
|
$
|
(1,839
|
)
|
|
$
|
625
|
|
|
$
|
2,836
|
|
Tax benefit (expense)
|
|
386
|
|
|
(219
|
)
|
|
(993
|
)
|
|||
Net of tax
|
|
$
|
(1,453
|
)
|
|
$
|
406
|
|
|
$
|
1,843
|
|
|
|
|
|
|
|
|
||||||
Derivatives:
|
|
|
|
|
|
|
||||||
Realized net gain (loss) on interest rate swap derivatives
(3)
|
|
$
|
1,319
|
|
|
$
|
(828
|
)
|
|
$
|
(1,815
|
)
|
Tax (expense) benefit
|
|
(277
|
)
|
|
290
|
|
|
635
|
|
|||
Net of tax
|
|
$
|
1,042
|
|
|
$
|
(538
|
)
|
|
$
|
(1,180
|
)
|
|
|
|
|
|
|
|
||||||
Amortization of unrealized gains on terminated interest rate swap derivatives
(3)
|
|
$
|
87
|
|
|
$
|
74
|
|
|
$
|
—
|
|
Tax expense
|
|
(18
|
)
|
|
(26
|
)
|
|
—
|
|
|||
Net of tax
|
|
$
|
69
|
|
|
$
|
48
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
||||||
Amortization of pension plan:
|
|
|
|
|
|
|
||||||
Net actuarial loss
(4)
|
|
$
|
(2,189
|
)
|
|
$
|
(1,613
|
)
|
|
$
|
(1,828
|
)
|
Prior service credit
(4)
|
|
7
|
|
|
8
|
|
|
8
|
|
|||
Total before tax
|
|
(2,182
|
)
|
|
(1,605
|
)
|
|
(1,820
|
)
|
|||
Tax benefit
|
|
459
|
|
|
562
|
|
|
637
|
|
|||
Net of tax
|
|
$
|
(1,723
|
)
|
|
$
|
(1,043
|
)
|
|
$
|
(1,183
|
)
|
Total reclassifications for the period, net of tax
|
|
$
|
(3,048
|
)
|
|
$
|
(1,943
|
)
|
|
$
|
(799
|
)
|
(4)
|
These accumulated other comprehensive income components are included in the computation of net periodic pension cost (income) presented in “Note 11 - Employee Benefits.”
|
|
|
December 31, 2018
|
||||||||||||||
|
|
Amortized
|
|
Gross
Unrealized
|
|
Gross Unrealized
|
|
Estimated
|
||||||||
AVAILABLE FOR SALE
|
|
Cost
|
|
Gains
|
|
Losses
|
|
Fair Value
|
||||||||
Investment Securities:
|
|
|
|
|
|
|
|
|
||||||||
State and Political Subdivisions
|
|
$
|
728,142
|
|
|
$
|
6,115
|
|
|
$
|
17,656
|
|
|
$
|
716,601
|
|
Other Stocks and Bonds
|
|
3,000
|
|
|
—
|
|
|
291
|
|
|
2,709
|
|
||||
Mortgage-backed Securities:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Residential
|
|
738,585
|
|
|
3,498
|
|
|
9,111
|
|
|
732,972
|
|
||||
Commercial
|
|
543,758
|
|
|
941
|
|
|
7,545
|
|
|
537,154
|
|
||||
Total
|
|
$
|
2,013,485
|
|
|
$
|
10,554
|
|
|
$
|
34,603
|
|
|
$
|
1,989,436
|
|
|
|
|
|
|
|
|
|
|
||||||||
HELD TO MATURITY
|
|
|
|
|
|
|
|
|
||||||||
Investment Securities:
|
|
|
|
|
|
|
|
|
||||||||
State and Political Subdivisions
|
|
$
|
3,083
|
|
|
$
|
5
|
|
|
$
|
42
|
|
|
$
|
3,046
|
|
Mortgage-backed Securities:
(1)
|
|
|
|
|
|
|
|
|
||||||||
Residential
|
|
59,655
|
|
|
154
|
|
|
1,140
|
|
|
58,669
|
|
||||
Commercial
|
|
100,193
|
|
|
201
|
|
|
2,328
|
|
|
98,066
|
|
||||
Total
|
|
$
|
162,931
|
|
|
$
|
360
|
|
|
$
|
3,510
|
|
|
$
|
159,781
|
|
|
|
December 31, 2017
|
||||||||||||||
|
|
Amortized
|
|
Gross
Unrealized
|
|
Gross Unrealized
|
|
Estimated
|
||||||||
AVAILABLE FOR SALE
|
|
Cost
|
|
Gains
|
|
Losses
|
|
Fair Value
|
||||||||
Investment Securities:
|
|
|
|
|
|
|
|
|
||||||||
U.S. Government Agency Debentures
|
|
$
|
108,869
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
108,869
|
|
State and Political Subdivisions
|
|
392,760
|
|
|
3,895
|
|
|
3,991
|
|
|
392,664
|
|
||||
Other Stocks and Bonds
|
|
5,024
|
|
|
31
|
|
|
—
|
|
|
5,055
|
|
||||
Other Equity Securities
(2)
|
|
6,027
|
|
|
—
|
|
|
107
|
|
|
5,920
|
|
||||
Mortgage-backed Securities:
(1)
|
|
|
|
|
|
|
|
|
|
|||||||
Residential
|
|
720,930
|
|
|
4,476
|
|
|
7,377
|
|
|
718,029
|
|
||||
Commercial
|
|
308,357
|
|
|
761
|
|
|
900
|
|
|
308,218
|
|
||||
Total
|
|
$
|
1,541,967
|
|
|
$
|
9,163
|
|
|
$
|
12,375
|
|
|
$
|
1,538,755
|
|
|
|
|
|
|
|
|
|
|
||||||||
HELD TO MATURITY
|
|
|
|
|
|
|
|
|
||||||||
Investment Securities:
|
|
|
|
|
|
|
|
|
||||||||
State and Political Subdivisions
|
|
$
|
413,632
|
|
|
$
|
10,879
|
|
|
$
|
2,583
|
|
|
$
|
421,928
|
|
Mortgage-backed Securities:
(1)
|
|
|
|
|
|
|
|
|
|
|||||||
Residential
|
|
129,044
|
|
|
1,631
|
|
|
239
|
|
|
130,436
|
|
||||
Commercial
|
|
366,830
|
|
|
3,812
|
|
|
1,206
|
|
|
369,436
|
|
||||
Total
|
|
$
|
909,506
|
|
|
$
|
16,322
|
|
|
$
|
4,028
|
|
|
$
|
921,800
|
|
(1)
|
All mortgage-backed securities issued and/or guaranteed by U.S. government agencies or U.S. government-sponsored enterprises.
|
(2)
|
See “Note 1 - Summary of Significant Accounting and Reporting Policies” for further information.
|
|
December 31, 2018
|
||||||||||||||||||||||
|
Less Than 12 Months
|
|
More Than 12 Months
|
|
Total
|
||||||||||||||||||
|
Fair Value
|
|
Unrealized
Loss
|
|
Fair Value
|
|
Unrealized
Loss
|
|
Fair Value
|
|
Unrealized
Loss
|
||||||||||||
AVAILABLE FOR SALE
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Investment Securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
State and Political Subdivisions
|
$
|
98,112
|
|
|
$
|
899
|
|
|
$
|
399,205
|
|
|
$
|
16,757
|
|
|
$
|
497,317
|
|
|
$
|
17,656
|
|
Other Stocks and Bonds
|
2,709
|
|
|
291
|
|
|
—
|
|
|
—
|
|
|
2,709
|
|
|
291
|
|
||||||
Mortgage-backed Securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Residential
|
5,552
|
|
|
27
|
|
|
488,334
|
|
|
9,084
|
|
|
493,886
|
|
|
9,111
|
|
||||||
Commercial
|
9,529
|
|
|
30
|
|
|
457,704
|
|
|
7,515
|
|
|
467,233
|
|
|
7,545
|
|
||||||
Total
|
$
|
115,902
|
|
|
$
|
1,247
|
|
|
$
|
1,345,243
|
|
|
$
|
33,356
|
|
|
$
|
1,461,145
|
|
|
$
|
34,603
|
|
HELD TO MATURITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Investment Securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
State and Political Subdivisions
|
$
|
235
|
|
|
$
|
1
|
|
|
$
|
2,022
|
|
|
$
|
41
|
|
|
$
|
2,257
|
|
|
$
|
42
|
|
Mortgage-backed Securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Residential
|
4,826
|
|
|
60
|
|
|
51,046
|
|
|
1,080
|
|
|
55,872
|
|
|
1,140
|
|
||||||
Commercial
|
399
|
|
|
2
|
|
|
89,168
|
|
|
2,326
|
|
|
89,567
|
|
|
2,328
|
|
||||||
Total
|
$
|
5,460
|
|
|
$
|
63
|
|
|
$
|
142,236
|
|
|
$
|
3,447
|
|
|
$
|
147,696
|
|
|
$
|
3,510
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
December 31, 2017
|
||||||||||||||||||||||
|
Less Than 12 Months
|
|
More Than 12 Months
|
|
Total
|
||||||||||||||||||
|
Fair Value
|
|
Unrealized
Loss |
|
Fair Value
|
|
Unrealized
Loss |
|
Fair Value
|
|
Unrealized
Loss |
||||||||||||
AVAILABLE FOR SALE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Investment Securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
State and Political Subdivisions
|
$
|
32,341
|
|
|
$
|
121
|
|
|
$
|
172,006
|
|
|
$
|
3,870
|
|
|
$
|
204,347
|
|
|
$
|
3,991
|
|
Other Equity Securities
(1)
|
5,920
|
|
|
107
|
|
|
—
|
|
|
—
|
|
|
5,920
|
|
|
107
|
|
||||||
Mortgage-backed Securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Residential
|
429,742
|
|
|
3,232
|
|
|
102,973
|
|
|
4,145
|
|
|
532,715
|
|
|
7,377
|
|
||||||
Commercial
|
146,796
|
|
|
419
|
|
|
13,134
|
|
|
481
|
|
|
159,930
|
|
|
900
|
|
||||||
Total
|
$
|
614,799
|
|
|
$
|
3,879
|
|
|
$
|
288,113
|
|
|
$
|
8,496
|
|
|
$
|
902,912
|
|
|
$
|
12,375
|
|
HELD TO MATURITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Investment Securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
State and Political Subdivisions
|
$
|
85,608
|
|
|
$
|
807
|
|
|
$
|
56,736
|
|
|
$
|
1,776
|
|
|
$
|
142,344
|
|
|
$
|
2,583
|
|
Mortgage-backed Securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Residential
|
24,707
|
|
|
157
|
|
|
2,736
|
|
|
82
|
|
|
27,443
|
|
|
239
|
|
||||||
Commercial
|
136,491
|
|
|
782
|
|
|
13,552
|
|
|
424
|
|
|
150,043
|
|
|
1,206
|
|
||||||
Total
|
$
|
246,806
|
|
|
$
|
1,746
|
|
|
$
|
73,024
|
|
|
$
|
2,282
|
|
|
$
|
319,830
|
|
|
$
|
4,028
|
|
(1)
|
See “Note 1 – Summary of Significant Accounting and Reporting Policies” for further information.
|
|
Years Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
U.S. Treasury
|
$
|
218
|
|
|
$
|
519
|
|
|
$
|
739
|
|
U.S. Government Agency Debentures
|
89
|
|
|
178
|
|
|
—
|
|
|||
State and Political Subdivisions
|
24,960
|
|
|
24,530
|
|
|
22,654
|
|
|||
Other Stocks and Bonds
|
110
|
|
|
125
|
|
|
195
|
|
|||
Other Equity Securities
(1)
|
—
|
|
|
116
|
|
|
123
|
|
|||
Mortgage-backed Securities
|
41,584
|
|
|
41,361
|
|
|
37,450
|
|
|||
Total interest income on securities
|
$
|
66,961
|
|
|
$
|
66,829
|
|
|
$
|
61,161
|
|
(1)
|
See “Note 1 - Summary of Significant Accounting and Reporting Policies” for further information.
|
|
December 31, 2018
|
||||||
|
Amortized Cost
|
|
Fair Value
|
||||
AVAILABLE FOR SALE
|
|
||||||
Investment Securities:
|
|
|
|
||||
Due in one year or less
|
$
|
3,559
|
|
|
$
|
3,602
|
|
Due after one year through five years
|
39,169
|
|
|
40,055
|
|
||
Due after five years through ten years
|
176,316
|
|
|
175,181
|
|
||
Due after ten years
|
512,098
|
|
|
500,472
|
|
||
|
731,142
|
|
|
719,310
|
|
||
Mortgage-backed Securities
|
1,282,343
|
|
|
1,270,126
|
|
||
Total
|
$
|
2,013,485
|
|
|
$
|
1,989,436
|
|
|
December 31, 2018
|
||||||
|
Amortized Cost
|
|
Fair Value
|
||||
HELD TO MATURITY
|
|
||||||
Investment Securities:
|
|
|
|
||||
Due in one year or less
|
$
|
116
|
|
|
$
|
115
|
|
Due after one year through five years
|
1,696
|
|
|
1,674
|
|
||
Due after five years through ten years
|
1,271
|
|
|
1,257
|
|
||
Due after ten years
|
—
|
|
|
—
|
|
||
|
3,083
|
|
|
3,046
|
|
||
Mortgage-backed Securities:
|
159,848
|
|
|
156,735
|
|
||
Total
|
$
|
162,931
|
|
|
$
|
159,781
|
|
|
|
Year Ended
|
||
|
|
December 31, 2018
|
||
Net losses recognized during the period on equity investments
|
|
$
|
(117
|
)
|
Less: Net gains (losses) recognized during the period on equity investments sold during the period
|
|
—
|
|
|
Unrealized losses recognized during the reporting period on equity investments still held at the reporting date
|
|
$
|
(117
|
)
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
Real Estate Loans:
|
|
|
|
|
||||
Construction
|
|
$
|
507,732
|
|
|
$
|
475,867
|
|
1-4 Family Residential
|
|
794,499
|
|
|
805,341
|
|
||
Commercial
|
|
1,194,118
|
|
|
1,265,159
|
|
||
Commercial Loans
|
|
356,649
|
|
|
266,422
|
|
||
Municipal Loans
|
|
353,370
|
|
|
345,798
|
|
||
Loans to Individuals
|
|
106,431
|
|
|
135,769
|
|
||
Total Loans
|
|
3,312,799
|
|
|
3,294,356
|
|
||
Less: Allowance for Loan Losses
(1)
|
|
27,019
|
|
|
20,781
|
|
||
Net Loans
|
|
$
|
3,285,780
|
|
|
$
|
3,273,575
|
|
(1)
|
Loans acquired with the Diboll acquisition were measured at fair value on
November 30, 2017
, with no carryover of allowance for loan loss. The allowance for loan loss recorded on PCI loans totaled
$302,000
as of
December 31, 2018
. There was
no
allowance for loan loss recorded on PCI loans as of
December 31, 2017
.
|
•
|
Pass (Rating 1 – 4) – This rating is assigned to all satisfactory loans. This category, by definition, consists of acceptable credit. Credit and collateral exceptions should not be present, although their presence would not necessarily prohibit a loan from being rated Pass, if deficiencies are in the process of correction. These loans are not included in the Watch List.
|
•
|
Pass Watch (Rating 5) – These loans require some degree of special treatment but not due to credit quality. This category does not include loans specially mentioned or adversely classified; however, particular attention is warranted to characteristics such as:
|
◦
|
A lack of, or abnormally extended payment program;
|
◦
|
A heavy degree of concentration of collateral without sufficient margin;
|
◦
|
A vulnerability to competition through lesser or extensive financial leverage; and
|
◦
|
A dependence on a single or few customers or sources of supply and materials without suitable substitutes or alternatives.
|
•
|
Special Mention (Rating 6) – A Special Mention loan has potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or in our credit position at some future date. Special Mention loans are not adversely classified and do not expose us to sufficient risk to warrant adverse classification.
|
•
|
Substandard (Rating 7) – Substandard loans are inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected.
|
•
|
Doubtful (Rating 8) – Loans classified as Doubtful have all the weaknesses inherent in those classified Substandard with the added characteristic that the weaknesses make collection or liquidation, in full, on the basis of currently known facts, conditions and values, highly questionable and improbable.
|
•
|
Changes in lending policies or procedures, including underwriting, collection, charge-off and recovery procedures;
|
•
|
Changes in local, regional and national economic and business conditions, including entry into new markets;
|
•
|
Changes in the volume or type of credit extended;
|
•
|
Changes in the experience, ability and depth of lending management;
|
•
|
Changes in the volume and severity of past due, nonaccrual, restructured or classified loans;
|
•
|
Changes in charge-off trends;
|
•
|
Changes in loan review or Board oversight;
|
•
|
Changes in the level of concentrations of credit; and
|
•
|
Changes in external factors, such as competition and legal and regulatory requirements.
|
|
|
Year Ended December 31, 2018
|
||||||||||||||||||||||||||
|
|
Real Estate
|
|
|
|
|
|
|
|
|
||||||||||||||||||
|
|
Construction
|
|
1-4 Family
Residential
|
|
Commercial
|
|
Commercial
Loans
|
|
Municipal
Loans
|
|
Loans to
Individuals
|
|
Total
|
||||||||||||||
Balance at beginning of period
(1)
|
|
$
|
3,676
|
|
|
$
|
2,445
|
|
|
$
|
10,821
|
|
|
$
|
2,094
|
|
|
$
|
860
|
|
|
$
|
885
|
|
|
$
|
20,781
|
|
Provision (reversal) for loan losses
(2)
|
|
(72
|
)
|
|
1,134
|
|
|
3,894
|
|
|
2,392
|
|
|
(335
|
)
|
|
1,424
|
|
|
8,437
|
|
|||||||
Loans charged off
|
|
(14
|
)
|
|
(91
|
)
|
|
(783
|
)
|
|
(756
|
)
|
|
—
|
|
|
(2,602
|
)
|
|
(4,246
|
)
|
|||||||
Recoveries of loans charged off
|
|
7
|
|
|
356
|
|
|
36
|
|
|
244
|
|
|
—
|
|
|
1,404
|
|
|
2,047
|
|
|||||||
Balance at end of period
|
|
$
|
3,597
|
|
|
$
|
3,844
|
|
|
$
|
13,968
|
|
|
$
|
3,974
|
|
|
$
|
525
|
|
|
$
|
1,111
|
|
|
$
|
27,019
|
|
|
|
Year Ended December 31, 2017
|
||||||||||||||||||||||||||
|
|
Real Estate
|
|
|
|
|
|
|
|
|
||||||||||||||||||
|
|
Construction
|
|
1-4 Family Residential
|
|
Commercial
|
|
Commercial Loans
|
|
Municipal Loans
|
|
Loans to
Individuals
|
|
Total
|
||||||||||||||
Balance at beginning of period
|
|
$
|
4,147
|
|
|
$
|
2,665
|
|
|
$
|
7,204
|
|
|
$
|
2,263
|
|
|
$
|
750
|
|
|
$
|
882
|
|
|
$
|
17,911
|
|
Provision (reversal) for loan losses
(2)
|
|
(437
|
)
|
|
65
|
|
|
3,604
|
|
|
242
|
|
|
110
|
|
|
1,091
|
|
|
4,675
|
|
|||||||
Loans charged off
|
|
(35
|
)
|
|
(304
|
)
|
|
—
|
|
|
(723
|
)
|
|
—
|
|
|
(2,391
|
)
|
|
(3,453
|
)
|
|||||||
Recoveries of loans charged off
|
|
1
|
|
|
19
|
|
|
13
|
|
|
312
|
|
|
—
|
|
|
1,303
|
|
|
1,648
|
|
|||||||
Balance at end of period
(1)
|
|
$
|
3,676
|
|
|
$
|
2,445
|
|
|
$
|
10,821
|
|
|
$
|
2,094
|
|
|
$
|
860
|
|
|
$
|
885
|
|
|
$
|
20,781
|
|
|
|
Year Ended December 31, 2016
|
||||||||||||||||||||||||||
|
|
Real Estate
|
|
|
|
|
|
|
|
|
||||||||||||||||||
|
|
Construction
|
|
1-4 Family Residential
|
|
Commercial
|
|
Commercial Loans
(3)
|
|
Municipal Loans
|
|
Loans to
Individuals
|
|
Total
|
||||||||||||||
Balance at beginning of period
|
|
$
|
4,350
|
|
|
$
|
2,595
|
|
|
$
|
4,577
|
|
|
$
|
6,596
|
|
|
$
|
725
|
|
|
$
|
893
|
|
|
$
|
19,736
|
|
Provision (reversal) for loan losses
(2)
|
|
(472
|
)
|
|
(28
|
)
|
|
2,604
|
|
|
6,397
|
|
|
(224
|
)
|
|
1,503
|
|
|
9,780
|
|
|||||||
Loans charged off
(3)
|
|
—
|
|
|
(43
|
)
|
|
—
|
|
|
(11,396
|
)
|
|
—
|
|
|
(2,948
|
)
|
|
(14,387
|
)
|
|||||||
Recoveries of loans charged off
|
|
269
|
|
|
141
|
|
|
23
|
|
|
666
|
|
|
249
|
|
|
1,434
|
|
|
2,782
|
|
|||||||
Balance at end of period
|
|
$
|
4,147
|
|
|
$
|
2,665
|
|
|
$
|
7,204
|
|
|
$
|
2,263
|
|
|
$
|
750
|
|
|
$
|
882
|
|
|
$
|
17,911
|
|
(3)
|
Of the
$11.4 million
in commercial charge-offs recorded for the
year ended December 31, 2016
,
$10.9 million
relates to the charge-off of
two
large commercial borrowing relationships.
|
|
|
December 31, 2018
|
||||||||||||||||||||||||||
|
|
Real Estate
|
|
|
|
|
|
|
|
|
||||||||||||||||||
|
|
Construction
|
|
1-4 Family
Residential
|
|
Commercial
|
|
Commercial
Loans
|
|
Municipal
Loans
|
|
Loans to
Individuals
|
|
Total
|
||||||||||||||
Ending balance – individually evaluated for impairment
(1)
|
|
$
|
13
|
|
|
$
|
40
|
|
|
$
|
5,337
|
|
|
$
|
368
|
|
|
$
|
1
|
|
|
$
|
149
|
|
|
$
|
5,908
|
|
Ending balance – collectively evaluated for impairment
|
|
3,584
|
|
|
3,804
|
|
|
8,631
|
|
|
3,606
|
|
|
524
|
|
|
962
|
|
|
21,111
|
|
|||||||
Balance at end of period
|
|
$
|
3,597
|
|
|
$
|
3,844
|
|
|
$
|
13,968
|
|
|
$
|
3,974
|
|
|
$
|
525
|
|
|
$
|
1,111
|
|
|
$
|
27,019
|
|
|
|
December 31, 2017
|
||||||||||||||||||||||||||
|
|
Real Estate
|
|
|
|
|
|
|
|
|
||||||||||||||||||
|
|
Construction
|
|
1-4 Family
Residential
|
|
Commercial
|
|
Commercial
Loans
|
|
Municipal
Loans
|
|
Loans to
Individuals
|
|
Total
|
||||||||||||||
Ending balance – individually evaluated for impairment
(1)
|
|
$
|
12
|
|
|
$
|
14
|
|
|
$
|
14
|
|
|
$
|
252
|
|
|
$
|
10
|
|
|
$
|
51
|
|
|
$
|
353
|
|
Ending balance – collectively evaluated for impairment
|
|
3,664
|
|
|
2,431
|
|
|
10,807
|
|
|
1,842
|
|
|
850
|
|
|
834
|
|
|
20,428
|
|
|||||||
Balance at end of period
|
|
$
|
3,676
|
|
|
$
|
2,445
|
|
|
$
|
10,821
|
|
|
$
|
2,094
|
|
|
$
|
860
|
|
|
$
|
885
|
|
|
$
|
20,781
|
|
(1)
|
The allowance for loan loss on PCI loans totaled
$302,000
as of
December 31, 2018
. There was
no
allowance for loan losses associated with PCI loans as of
December 31, 2017
.
|
|
|
December 31, 2018
|
||||||||||||||||||||||||||
|
|
Real Estate
|
|
|
|
|
|
|
|
|
||||||||||||||||||
|
|
Construction
|
|
|
1-4 Family Residential
|
|
Commercial
|
|
Commercial Loans
|
|
Municipal Loans
|
|
Loans to Individuals
|
|
Total
|
|
||||||||||||
Loans individually evaluated for impairment
|
|
$
|
12
|
|
|
$
|
1,215
|
|
|
$
|
33,013
|
|
|
$
|
1,394
|
|
|
$
|
429
|
|
|
$
|
184
|
|
|
$
|
36,247
|
|
Loans collectively evaluated for impairment
|
|
507,564
|
|
|
782,614
|
|
|
1,128,220
|
|
|
353,036
|
|
|
352,941
|
|
|
105,775
|
|
|
3,230,150
|
|
|||||||
Purchased credit impaired loans
(1)
|
|
156
|
|
|
10,670
|
|
|
32,885
|
|
|
2,219
|
|
|
—
|
|
|
472
|
|
|
46,402
|
|
|||||||
Total ending loan balance
|
|
$
|
507,732
|
|
|
$
|
794,499
|
|
|
$
|
1,194,118
|
|
|
$
|
356,649
|
|
|
$
|
353,370
|
|
|
$
|
106,431
|
|
|
$
|
3,312,799
|
|
|
|
December 31, 2017
|
||||||||||||||||||||||||||
|
|
Real Estate
|
|
|
|
|
|
|
|
|
||||||||||||||||||
|
|
Construction
|
|
1-4 Family Residential
|
|
Commercial
|
|
Commercial Loans
|
|
Municipal Loans
|
|
Loans to Individuals
|
|
Total
|
||||||||||||||
Loans individually evaluated for impairment
|
|
$
|
86
|
|
|
$
|
1,581
|
|
|
$
|
895
|
|
|
$
|
1,429
|
|
|
$
|
502
|
|
|
$
|
205
|
|
|
$
|
4,698
|
|
Loans collectively evaluated for impairment
|
|
475,505
|
|
|
797,111
|
|
|
1,232,327
|
|
|
259,745
|
|
|
345,296
|
|
|
134,441
|
|
|
3,244,425
|
|
|||||||
Purchased credit impaired loans
|
|
276
|
|
|
6,649
|
|
|
31,937
|
|
|
5,248
|
|
|
—
|
|
|
1,123
|
|
|
45,233
|
|
|||||||
Total ending loan balance
|
|
$
|
475,867
|
|
|
$
|
805,341
|
|
|
$
|
1,265,159
|
|
|
$
|
266,422
|
|
|
$
|
345,798
|
|
|
$
|
135,769
|
|
|
$
|
3,294,356
|
|
|
|
December 31, 2018
|
||||||||||||||||||||||
|
|
Pass
|
|
Pass Watch
(1)
|
|
Special Mention
(1)
|
|
Substandard
(1)
|
|
Doubtful
(1)
|
|
Total
|
||||||||||||
Real Estate Loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Construction
|
|
$
|
507,529
|
|
|
$
|
163
|
|
|
$
|
—
|
|
|
$
|
28
|
|
|
$
|
12
|
|
|
$
|
507,732
|
|
1-4 Family Residential
|
|
787,516
|
|
|
37
|
|
|
100
|
|
|
5,489
|
|
|
1,357
|
|
|
794,499
|
|
||||||
Commercial
|
|
1,067,874
|
|
|
11,479
|
|
|
26,490
|
|
|
87,767
|
|
|
508
|
|
|
1,194,118
|
|
||||||
Commercial Loans
|
|
349,495
|
|
|
520
|
|
|
3,189
|
|
|
2,988
|
|
|
457
|
|
|
356,649
|
|
||||||
Municipal Loans
|
|
353,370
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
353,370
|
|
||||||
Loans to Individuals
|
|
105,536
|
|
|
4
|
|
|
4
|
|
|
678
|
|
|
209
|
|
|
106,431
|
|
||||||
Total
|
|
$
|
3,171,320
|
|
|
$
|
12,203
|
|
|
$
|
29,783
|
|
|
$
|
96,950
|
|
|
$
|
2,543
|
|
|
$
|
3,312,799
|
|
|
|
December 31, 2017
|
||||||||||||||||||||||
|
|
Pass
|
|
Pass Watch
(1)
|
|
Special Mention
(1)
|
|
Substandard
(1)
|
|
Doubtful
(1)
|
|
Total
|
||||||||||||
Real Estate Loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Construction
|
|
$
|
471,446
|
|
|
$
|
3,329
|
|
|
$
|
77
|
|
|
$
|
982
|
|
|
$
|
33
|
|
|
$
|
475,867
|
|
1-4 Family Residential
|
|
796,639
|
|
|
559
|
|
|
857
|
|
|
6,610
|
|
|
676
|
|
|
805,341
|
|
||||||
Commercial
|
|
1,136,576
|
|
|
26,275
|
|
|
25,301
|
|
|
76,625
|
|
|
382
|
|
|
1,265,159
|
|
||||||
Commercial Loans
|
|
247,430
|
|
|
9,625
|
|
|
3,956
|
|
|
5,203
|
|
|
208
|
|
|
266,422
|
|
||||||
Municipal Loans
|
|
344,366
|
|
|
—
|
|
|
930
|
|
|
502
|
|
|
—
|
|
|
345,798
|
|
||||||
Loans to Individuals
|
|
134,694
|
|
|
20
|
|
|
102
|
|
|
707
|
|
|
246
|
|
|
135,769
|
|
||||||
Total
|
|
$
|
3,131,151
|
|
|
$
|
39,808
|
|
|
$
|
31,223
|
|
|
$
|
90,629
|
|
|
$
|
1,545
|
|
|
$
|
3,294,356
|
|
(1)
|
Includes PCI loans comprised of
$22,000
pass watch,
$859,000
special mention,
$3.9 million
substandard and
$1.2 million
doubtful as of
December 31, 2018
. Includes PCI loans comprised of
$362,000
pass watch,
$6.0 million
special mention,
$10.5 million
substandard and
$925,000
doubtful as of
December 31, 2017
.
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
Nonaccrual loans
(1) (2)
|
|
$
|
35,770
|
|
|
$
|
2,937
|
|
Accruing loans past due more than 90 days
(1)
|
|
—
|
|
|
1
|
|
||
Restructured loans
(3)
|
|
5,930
|
|
|
5,767
|
|
||
Other real estate owned
|
|
1,206
|
|
|
1,613
|
|
||
Repossessed assets
|
|
—
|
|
|
154
|
|
||
Total Nonperforming Assets
|
|
$
|
42,906
|
|
|
$
|
10,472
|
|
(1)
|
Excludes PCI loans measured at fair value at acquisition if the timing and amount of cash flows expected to be collected from those sales can be reasonably estimated. The increase in nonaccrual loans was primarily
due to the addition of
four
commercial real estate loans to nonaccrual status during the year,
one
of which was added during the fourth quarter
.
|
(2)
|
Includes
$10.9 million
and
$1.3 million
of restructured loans as of
December 31, 2018
and
2017
, respectively.
|
(3)
|
Includes
$3.1 million
and
$2.9 million
in PCI loans restructured as of
December 31, 2018
and
2017
, respectively.
|
|
|
Nonaccrual Loans
|
||||||
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
Real Estate Loans:
|
|
|
|
|
||||
Construction
|
|
$
|
12
|
|
|
$
|
86
|
|
1-4 Family Residential
|
|
2,202
|
|
|
1,098
|
|
||
Commercial
|
|
32,599
|
|
|
595
|
|
||
Commercial Loans
|
|
639
|
|
|
903
|
|
||
Loans to Individuals
|
|
318
|
|
|
255
|
|
||
Total
|
|
$
|
35,770
|
|
|
$
|
2,937
|
|
|
|
December 31, 2018
|
||||||||||
|
|
Unpaid Contractual
Principal Balance
|
|
Recorded
Investment
|
|
Related Allowance for Loan Losses
|
||||||
Real Estate Loans:
|
|
|
|
|
|
|
||||||
Construction
|
|
$
|
182
|
|
|
$
|
148
|
|
|
$
|
13
|
|
1-4 Family Residential
|
|
6,507
|
|
|
5,923
|
|
|
40
|
|
|||
Commercial
|
|
36,457
|
|
|
34,744
|
|
|
5,337
|
|
|||
Commercial Loans
|
|
2,874
|
|
|
2,366
|
|
|
368
|
|
|||
Municipal Loans
|
|
429
|
|
|
429
|
|
|
1
|
|
|||
Loans to Individuals
|
|
825
|
|
|
657
|
|
|
149
|
|
|||
Total
(1)
|
|
$
|
47,274
|
|
|
$
|
44,267
|
|
|
$
|
5,908
|
|
|
|
December 31, 2017
|
||||||||||
|
|
Unpaid Contractual
Principal Balance
|
|
Recorded
Investment |
|
Related Allowance for Loan Losses
|
||||||
Real Estate Loans:
|
|
|
|
|
|
|
||||||
Construction
|
|
$
|
91
|
|
|
$
|
86
|
|
|
$
|
12
|
|
1-4 Family Residential
|
|
4,141
|
|
|
3,952
|
|
|
14
|
|
|||
Commercial
|
|
1,353
|
|
|
1,199
|
|
|
14
|
|
|||
Commercial Loans
|
|
1,665
|
|
|
1,605
|
|
|
252
|
|
|||
Municipal Loans
|
|
502
|
|
|
502
|
|
|
10
|
|
|||
Loans to Individuals
|
|
237
|
|
|
205
|
|
|
51
|
|
|||
Total
(1)
|
|
$
|
7,989
|
|
|
$
|
7,549
|
|
|
$
|
353
|
|
(1)
|
Includes
$8.0 million
and
$2.9 million
of PCI loans that experienced deterioration in credit quality subsequent to the acquisition date as of
December 31, 2018
and
December 31, 2017
, respectively.
|
|
|
December 31, 2018
|
||||||||||||||||||||||
|
|
30-59 Days
Past Due
|
|
60-89 Days
Past Due
|
|
Greater than
90 Days
Past Due
|
|
Total Past
Due
|
|
Current
(1)
|
|
Total
|
||||||||||||
Real Estate Loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Construction
|
|
$
|
627
|
|
|
$
|
307
|
|
|
$
|
—
|
|
|
$
|
934
|
|
|
$
|
506,798
|
|
|
$
|
507,732
|
|
1-4 Family Residential
|
|
7,441
|
|
|
1,258
|
|
|
1,335
|
|
|
10,034
|
|
|
784,465
|
|
|
794,499
|
|
||||||
Commercial
|
|
10,663
|
|
|
7,655
|
|
|
—
|
|
|
18,318
|
|
|
1,175,800
|
|
|
1,194,118
|
|
||||||
Commercial Loans
|
|
1,946
|
|
|
705
|
|
|
591
|
|
|
3,242
|
|
|
353,407
|
|
|
356,649
|
|
||||||
Municipal Loans
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
353,370
|
|
|
353,370
|
|
||||||
Loans to Individuals
|
|
1,289
|
|
|
351
|
|
|
146
|
|
|
1,786
|
|
|
104,645
|
|
|
106,431
|
|
||||||
Total
|
|
$
|
21,966
|
|
|
$
|
10,276
|
|
|
$
|
2,072
|
|
|
$
|
34,314
|
|
|
$
|
3,278,485
|
|
|
$
|
3,312,799
|
|
|
|
December 31, 2017
|
||||||||||||||||||||||
|
|
30-59 Days
Past Due
|
|
60-89 Days
Past Due
|
|
Greater than
90 Days
Past Due
|
|
Total Past
Due
|
|
Current
(1)
|
|
Total
|
||||||||||||
Real Estate Loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Construction
|
|
$
|
1,302
|
|
|
$
|
1,530
|
|
|
$
|
68
|
|
|
$
|
2,900
|
|
|
$
|
472,967
|
|
|
$
|
475,867
|
|
1-4 Family Residential
|
|
8,508
|
|
|
1,574
|
|
|
862
|
|
|
10,944
|
|
|
794,397
|
|
|
805,341
|
|
||||||
Commercial
|
|
1,357
|
|
|
24
|
|
|
5
|
|
|
1,386
|
|
|
1,263,773
|
|
|
1,265,159
|
|
||||||
Commercial Loans
|
|
662
|
|
|
400
|
|
|
333
|
|
|
1,395
|
|
|
265,027
|
|
|
266,422
|
|
||||||
Municipal Loans
|
|
422
|
|
|
—
|
|
|
—
|
|
|
422
|
|
|
345,376
|
|
|
345,798
|
|
||||||
Loans to Individuals
|
|
1,526
|
|
|
373
|
|
|
93
|
|
|
1,992
|
|
|
133,777
|
|
|
135,769
|
|
||||||
Total
|
|
$
|
13,777
|
|
|
$
|
3,901
|
|
|
$
|
1,361
|
|
|
$
|
19,039
|
|
|
$
|
3,275,317
|
|
|
$
|
3,294,356
|
|
(1)
|
Includes PCI loans measured at fair value at acquisition if the timing and amount of cash flows expected to be collected from those sales can be reasonably estimated.
|
|
|
Years Ended December 31,
|
||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||||||||||||||
|
|
Average
Recorded Investment
|
|
Interest Income Recognized
|
|
Average Recorded Investment
|
|
Interest Income Recognized
|
|
Average Recorded Investment
|
|
Interest Income Recognized
|
||||||||||||
Real Estate Loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Construction
|
|
$
|
149
|
|
|
$
|
7
|
|
|
$
|
251
|
|
|
$
|
—
|
|
|
$
|
510
|
|
|
$
|
22
|
|
1-4 Family Residential
|
|
4,193
|
|
|
208
|
|
|
4,264
|
|
|
197
|
|
|
3,247
|
|
|
169
|
|
||||||
Commercial
|
|
26,186
|
|
|
65
|
|
|
1,338
|
|
|
30
|
|
|
4,490
|
|
|
63
|
|
||||||
Commercial Loans
|
|
2,131
|
|
|
102
|
|
|
2,862
|
|
|
59
|
|
|
13,481
|
|
|
48
|
|
||||||
Municipal Loans
|
|
474
|
|
|
26
|
|
|
545
|
|
|
30
|
|
|
612
|
|
|
33
|
|
||||||
Loans to Individuals
|
|
250
|
|
|
9
|
|
|
244
|
|
|
9
|
|
|
257
|
|
|
9
|
|
||||||
Total
|
|
$
|
33,383
|
|
|
$
|
417
|
|
|
$
|
9,504
|
|
|
$
|
325
|
|
|
$
|
22,597
|
|
|
$
|
344
|
|
|
|
December 31, 2018
|
||||||||||||||||
|
|
Extend Amortization
Period
|
|
Interest Rate Reductions
|
|
Combination
|
|
Total Modifications
|
|
Number of Contracts
|
||||||||
Real Estate Loans:
|
|
|
|
|
|
|
|
|
|
|
||||||||
1-4 Family Residential
|
|
$
|
—
|
|
|
$
|
79
|
|
|
$
|
—
|
|
|
$
|
79
|
|
|
1
|
Commercial
|
|
10,398
|
|
|
—
|
|
|
274
|
|
|
10,672
|
|
|
3
|
||||
Commercial Loans
|
|
211
|
|
|
—
|
|
|
215
|
|
|
426
|
|
|
13
|
||||
Loans to Individuals
|
|
8
|
|
|
33
|
|
|
51
|
|
|
92
|
|
|
5
|
||||
Total
|
|
$
|
10,617
|
|
|
$
|
112
|
|
|
$
|
540
|
|
|
$
|
11,269
|
|
|
22
|
|
|
December 31, 2017
|
||||||||||||||||
|
|
Extend Amortization
Period
|
|
Interest Rate Reductions
|
|
Combination
|
|
Total Modifications
|
|
Number of Contracts
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
Commercial Loans
|
|
$
|
778
|
|
|
$
|
—
|
|
|
$
|
241
|
|
|
$
|
1,019
|
|
|
4
|
Loans to Individuals
|
|
23
|
|
|
—
|
|
|
52
|
|
|
75
|
|
|
6
|
||||
Total
|
|
$
|
801
|
|
|
$
|
—
|
|
|
$
|
293
|
|
|
$
|
1,094
|
|
|
10
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
Outstanding principal balance
(1)
|
$
|
51,388
|
|
|
$
|
52,426
|
|
Carrying amount
(1)
|
$
|
46,402
|
|
|
$
|
45,233
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
Balance at beginning of period
|
$
|
18,721
|
|
|
$
|
2,480
|
|
Additions due to acquisition
|
—
|
|
|
15,389
|
|
||
Changes in expected cash flows not affecting non-accretable differences
|
(1,445
|
)
|
|
—
|
|
||
Reclassifications (to) from nonaccretable discount
|
1,211
|
|
|
1,720
|
|
||
Accretion
|
(3,433
|
)
|
|
(868
|
)
|
||
Balance at end of period
|
$
|
15,054
|
|
|
$
|
18,721
|
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
|
|
(in thousands)
|
||||||
Premises
|
|
$
|
166,128
|
|
|
$
|
158,817
|
|
Furniture and equipment
|
|
41,810
|
|
|
40,565
|
|
||
|
|
207,938
|
|
|
199,382
|
|
||
Less: accumulated depreciation
|
|
71,966
|
|
|
65,742
|
|
||
Total
|
|
$
|
135,972
|
|
|
$
|
133,640
|
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
|
|
(in thousands)
|
||||||
Noninterest bearing demand deposits:
|
|
|
|
|
||||
Private accounts
|
|
$
|
967,096
|
|
|
$
|
995,685
|
|
Public accounts
|
|
27,584
|
|
|
41,716
|
|
||
Total noninterest bearing demand deposits
|
|
994,680
|
|
|
1,037,401
|
|
||
Interest bearing deposits:
|
|
|
|
|
|
|
||
Private accounts:
|
|
|
|
|
|
|
||
Savings deposits
|
|
360,007
|
|
|
356,857
|
|
||
Money market demand deposits
|
|
440,442
|
|
|
443,015
|
|
||
Platinum money market deposits
|
|
344,546
|
|
|
308,105
|
|
||
Interest bearing checking
|
|
662,911
|
|
|
686,816
|
|
||
NOW demand deposits
|
|
23,451
|
|
|
20,142
|
|
||
Certificates and other time deposits of $250,000 or more
|
|
84,564
|
|
|
87,195
|
|
||
Certificates and other time deposits under $250,000
|
|
680,282
|
|
|
534,220
|
|
||
Total private accounts
|
|
2,596,203
|
|
|
2,436,350
|
|
||
Public accounts:
|
|
|
|
|
|
|
||
Savings deposits
|
|
320
|
|
|
304
|
|
||
Money market demand deposits
|
|
15,513
|
|
|
19,560
|
|
||
Platinum money market deposits
|
|
329,695
|
|
|
360,006
|
|
||
Interest bearing checking
|
|
56,694
|
|
|
55,902
|
|
||
NOW demand deposits
|
|
141,200
|
|
|
114,401
|
|
||
Certificates and other time deposits of $250,000 or more
|
|
281,204
|
|
|
462,941
|
|
||
Certificates and other time deposits under $250,000
|
|
9,521
|
|
|
28,582
|
|
||
Total public accounts
|
|
834,147
|
|
|
1,041,696
|
|
||
Total interest bearing deposits
|
|
3,430,350
|
|
|
3,478,046
|
|
||
Total deposits
|
|
$
|
4,425,030
|
|
|
$
|
4,515,447
|
|
2019
|
$
|
845,661
|
|
2020
|
116,542
|
|
|
2021
|
42,254
|
|
|
2022
|
20,003
|
|
|
2023
|
25,931
|
|
|
2024 and thereafter
|
5,180
|
|
|
|
$
|
1,055,571
|
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
Federal funds purchased and repurchase agreements:
|
|
|
|
|
||||
Balance at end of period
|
|
$
|
36,810
|
|
|
$
|
9,498
|
|
Average amount outstanding during the period
(1)
|
|
10,880
|
|
|
8,120
|
|
||
Maximum amount outstanding during the period
(2)
|
|
36,810
|
|
|
9,498
|
|
||
Weighted average interest rate during the period
(3)
|
|
1.4
|
%
|
|
0.2
|
%
|
||
Interest rate at end of period
(4)
|
|
2.1
|
%
|
|
0.2
|
%
|
||
|
|
|
|
|
||||
FHLB borrowings:
|
|
|
|
|
|
|
||
Balance at end of period
|
|
$
|
719,065
|
|
|
$
|
1,017,361
|
|
Average amount outstanding during the period
(1)
|
|
720,785
|
|
|
1,222,033
|
|
||
Maximum amount outstanding during the period
(2)
|
|
957,231
|
|
|
1,414,453
|
|
||
Weighted average interest rate during the period
(3)
|
|
1.8
|
%
|
|
1.2
|
%
|
||
Interest rate at end of period
(4)
|
|
2.3
|
%
|
|
1.4
|
%
|
(1)
|
The average amount outstanding during the period was computed by dividing the total daily outstanding principal balances by the number of days in the period.
|
(2)
|
The maximum amount outstanding at any month-end during the period.
|
(3)
|
The weighted average interest rate during the period was computed by dividing the actual interest expense by the average amount outstanding during the period. The weighted average interest rate on the FHLB borrowings includes the effect of interest rate swaps.
|
(4)
|
Stated rate.
|
|
|
Payments Due by Period
|
||||||||||||||||||||||||||
|
|
Less than 1 Year
|
|
1-2 Years
|
|
2-3 Years
|
|
3-4 Years
|
|
4-5 Years
|
|
Thereafter
|
|
Total
|
||||||||||||||
Federal funds purchased and repurchase agreements
|
|
$
|
36,686
|
|
|
$
|
124
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
36,810
|
|
FHLB borrowings
|
|
336,502
|
|
|
365,165
|
|
|
11,483
|
|
|
—
|
|
|
—
|
|
|
5,915
|
|
|
719,065
|
|
|||||||
Total obligations
|
|
$
|
373,188
|
|
|
$
|
365,289
|
|
|
$
|
11,483
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,915
|
|
|
$
|
755,875
|
|
|
December 31, 2018
|
|
December 31,
2017 |
||||
|
(in thousands)
|
||||||
Subordinated notes:
(1)
|
|
|
|
||||
5.50% Subordinated Notes, net of unamortized debt issuance costs
(2)
|
$
|
98,407
|
|
|
$
|
98,248
|
|
Total Subordinated notes
|
98,407
|
|
|
98,248
|
|
||
Trust preferred subordinated debentures:
(3)
|
|
|
|
||||
Southside Statutory Trust III, net of unamortized debt issuance costs
(4)
|
20,554
|
|
|
20,549
|
|
||
Southside Statutory Trust IV
|
23,196
|
|
|
23,196
|
|
||
Southside Statutory Trust V
|
12,887
|
|
|
12,887
|
|
||
Magnolia Trust Company I
|
3,609
|
|
|
3,609
|
|
||
Total Trust preferred subordinated debentures
|
60,246
|
|
|
60,241
|
|
||
Total Long-term debt
|
$
|
158,653
|
|
|
$
|
158,489
|
|
(1)
|
This debt consists of subordinated notes with a remaining maturity greater than
one
year that qualify under the risk-based capital guidelines as Tier 2 capital, subject to certain limitations.
|
(2)
|
The unamortized discount and debt issuance costs reflected in the carrying amount of the subordinated notes totaled approximately
$1.6 million
at
December 31, 2018
and
$1.8 million
at
December 31, 2017
.
|
(3)
|
This debt consists of trust preferred securities that qualify under the risk-based capital guidelines as Tier 1 capital, subject to certain limitations.
|
(4)
|
The unamortized debt issuance costs reflected in the carrying amount of the Southside Statutory Trust III junior subordinated debentures totaled
$65,000
at
December 31, 2018
and
$70,000
at
December 31, 2017
.
|
(1)
|
On October 10, 2007, as part of an acquisition we assumed
$3.6 million
of floating rate junior subordinated debentures issued in 2005 to Magnolia Trust Company I.
|
|
|
Year Ended December 31,
|
||||||||||||||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||||||||||||||||||||||||||
|
|
Defined Benefit
Pension
Plan
|
|
Defined
Benefit Pension Plan Acquired |
|
Restoration
Plan
|
|
Defined
Benefit
Pension
Plan
|
|
Defined
Benefit Pension Plan Acquired |
|
Restoration
Plan
|
|
Defined
Benefit
Pension
Plan
|
|
Defined
Benefit Pension Plan Acquired |
|
Restoration
Plan
|
||||||||||||||||||
|
|
(in thousands)
|
||||||||||||||||||||||||||||||||||
Change in Projected Benefit Obligation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Benefit obligation at end of prior year
|
|
$
|
94,276
|
|
|
$
|
4,392
|
|
|
$
|
14,642
|
|
|
$
|
88,071
|
|
|
$
|
4,238
|
|
|
$
|
12,723
|
|
|
$
|
80,040
|
|
|
$
|
4,685
|
|
|
$
|
12,024
|
|
Service cost
|
|
1,548
|
|
|
—
|
|
|
293
|
|
|
1,398
|
|
|
—
|
|
|
247
|
|
|
1,375
|
|
|
—
|
|
|
207
|
|
|||||||||
Interest cost
|
|
3,392
|
|
|
163
|
|
|
597
|
|
|
3,601
|
|
|
177
|
|
|
567
|
|
|
3,731
|
|
|
212
|
|
|
535
|
|
|||||||||
Actuarial (gain) loss
|
|
(9,399
|
)
|
|
(480
|
)
|
|
344
|
|
|
5,404
|
|
|
418
|
|
|
1,751
|
|
|
4,978
|
|
|
275
|
|
|
237
|
|
|||||||||
Benefits paid
|
|
(3,622
|
)
|
|
(183
|
)
|
|
(576
|
)
|
|
(4,128
|
)
|
|
(43
|
)
|
|
(646
|
)
|
|
(3,632
|
)
|
|
(31
|
)
|
|
(280
|
)
|
|||||||||
Expenses paid
|
|
(203
|
)
|
|
(19
|
)
|
|
—
|
|
|
(70
|
)
|
|
(47
|
)
|
|
—
|
|
|
(91
|
)
|
|
(39
|
)
|
|
—
|
|
|||||||||
Plan amendments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
121
|
|
|
—
|
|
|
—
|
|
|||||||||
Settlements
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(351
|
)
|
|
—
|
|
|
—
|
|
|
(864
|
)
|
|
—
|
|
|||||||||
Special and contractual termination benefits
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,549
|
|
|
—
|
|
|
—
|
|
|||||||||
Benefit obligation at end of year
|
|
85,992
|
|
|
3,873
|
|
|
15,300
|
|
|
94,276
|
|
|
4,392
|
|
|
14,642
|
|
|
88,071
|
|
|
4,238
|
|
|
12,723
|
|
|||||||||
Change in Plan Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fair value of plan assets at end of prior year
|
|
91,233
|
|
|
4,031
|
|
|
—
|
|
|
85,293
|
|
|
2,993
|
|
|
—
|
|
|
76,355
|
|
|
3,740
|
|
|
—
|
|
|||||||||
Actual return
|
|
(4,497
|
)
|
|
(259
|
)
|
|
—
|
|
|
8,138
|
|
|
479
|
|
|
—
|
|
|
7,661
|
|
|
187
|
|
|
—
|
|
|||||||||
Employer contributions
|
|
2,000
|
|
|
500
|
|
|
576
|
|
|
2,000
|
|
|
1,000
|
|
|
646
|
|
|
5,000
|
|
|
—
|
|
|
280
|
|
|||||||||
Benefits paid
|
|
(3,622
|
)
|
|
(183
|
)
|
|
(576
|
)
|
|
(4,128
|
)
|
|
(43
|
)
|
|
(646
|
)
|
|
(3,632
|
)
|
|
(31
|
)
|
|
(280
|
)
|
|||||||||
Expenses paid
|
|
(203
|
)
|
|
(19
|
)
|
|
—
|
|
|
(70
|
)
|
|
(47
|
)
|
|
—
|
|
|
(91
|
)
|
|
(39
|
)
|
|
—
|
|
|||||||||
Settlements
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(351
|
)
|
|
—
|
|
|
—
|
|
|
(864
|
)
|
|
—
|
|
|||||||||
Fair value of plan assets at end of year
|
|
84,911
|
|
|
4,070
|
|
|
—
|
|
|
91,233
|
|
|
4,031
|
|
|
—
|
|
|
85,293
|
|
|
2,993
|
|
|
—
|
|
|||||||||
(Un)Funded status at end of year
|
|
(1,081
|
)
|
|
197
|
|
|
(15,300
|
)
|
|
(3,043
|
)
|
|
(361
|
)
|
|
(14,642
|
)
|
|
(2,778
|
)
|
|
(1,245
|
)
|
|
(12,723
|
)
|
|||||||||
Accrued benefit (liability) asset recognized
|
|
$
|
(1,081
|
)
|
|
$
|
197
|
|
|
$
|
(15,300
|
)
|
|
$
|
(3,043
|
)
|
|
$
|
(361
|
)
|
|
$
|
(14,642
|
)
|
|
$
|
(2,778
|
)
|
|
$
|
(1,245
|
)
|
|
$
|
(12,723
|
)
|
Accumulated benefit obligation at end of year
|
|
$
|
77,888
|
|
|
$
|
3,873
|
|
|
$
|
13,403
|
|
|
$
|
83,802
|
|
|
$
|
4,392
|
|
|
$
|
13,246
|
|
|
$
|
77,639
|
|
|
$
|
4,238
|
|
|
$
|
11,133
|
|
|
|
Year Ended December 31,
|
||||||||||||||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||||||||||||||||||||||||||
|
|
Defined
Benefit Pension Plan |
|
Defined
Benefit Pension Plan Acquired |
|
Restoration
Plan |
|
Defined
Benefit Pension Plan |
|
Defined
Benefit Pension Plan Acquired |
|
Restoration
Plan |
|
Defined
Benefit Pension Plan |
|
Defined
Benefit Pension Plan Acquired |
|
Restoration
Plan |
||||||||||||||||||
Recognition of net loss
|
|
$
|
1,512
|
|
|
$
|
—
|
|
|
$
|
677
|
|
|
$
|
1,312
|
|
|
$
|
—
|
|
|
$
|
301
|
|
|
$
|
1,642
|
|
|
$
|
—
|
|
|
$
|
186
|
|
Recognition of prior service (credit) cost
|
|
(14
|
)
|
|
—
|
|
|
7
|
|
|
(14
|
)
|
|
—
|
|
|
6
|
|
|
(14
|
)
|
|
—
|
|
|
6
|
|
|||||||||
Recognition of loss (gain) due to settlement
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8
|
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
|
—
|
|
|||||||||
Net (loss) gain occurring during the year
|
|
(1,581
|
)
|
|
(69
|
)
|
|
(344
|
)
|
|
(3,317
|
)
|
|
(150
|
)
|
|
(1,751
|
)
|
|
(2,541
|
)
|
|
(354
|
)
|
|
(237
|
)
|
|||||||||
Net prior service cost occurring during the year
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(121
|
)
|
|
—
|
|
|
—
|
|
|||||||||
|
|
(83
|
)
|
|
(69
|
)
|
|
340
|
|
|
(2,019
|
)
|
|
(142
|
)
|
|
(1,444
|
)
|
|
(1,034
|
)
|
|
(362
|
)
|
|
(45
|
)
|
|||||||||
Deferred tax benefit (expense)
|
|
17
|
|
|
14
|
|
|
(71
|
)
|
|
241
|
|
|
30
|
|
|
259
|
|
|
362
|
|
|
127
|
|
|
16
|
|
|||||||||
Other comprehensive (loss) income, net of tax
|
|
$
|
(66
|
)
|
|
$
|
(55
|
)
|
|
$
|
269
|
|
|
$
|
(1,778
|
)
|
|
$
|
(112
|
)
|
|
$
|
(1,185
|
)
|
|
$
|
(672
|
)
|
|
$
|
(235
|
)
|
|
$
|
(29
|
)
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
|
|
Defined
Benefit
Pension
Plan
|
|
Defined
Benefit Pension Plan Acquired |
|
Restoration
Plan
|
|
Defined
Benefit Pension Plan |
|
Defined
Benefit Pension Plan Acquired |
|
Restoration
Plan
|
||||||||||||
Net loss
|
|
$
|
1,512
|
|
|
$
|
—
|
|
|
$
|
677
|
|
|
$
|
1,312
|
|
|
$
|
—
|
|
|
$
|
301
|
|
Prior service (credit) cost
|
|
(14
|
)
|
|
—
|
|
|
7
|
|
|
(14
|
)
|
|
—
|
|
|
6
|
|
||||||
Loss (gain) recognized due to settlement
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8
|
|
|
—
|
|
||||||
|
|
1,498
|
|
|
—
|
|
|
684
|
|
|
1,298
|
|
|
8
|
|
|
307
|
|
||||||
Deferred tax (expense) benefit
|
|
(315
|
)
|
|
—
|
|
|
(144
|
)
|
|
(454
|
)
|
|
(2
|
)
|
|
(107
|
)
|
||||||
Accumulated other comprehensive income (loss), net of tax
|
|
$
|
1,183
|
|
|
$
|
—
|
|
|
$
|
540
|
|
|
$
|
844
|
|
|
$
|
6
|
|
|
$
|
200
|
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
|
|
Defined
Benefit Pension Plan |
|
Defined
Benefit Pension Plan Acquired |
|
Restoration
Plan |
|
Defined
Benefit Pension Plan |
|
Defined
Benefit Pension Plan Acquired |
|
Restoration
Plan |
||||||||||||
Net (loss) gain
|
|
$
|
(28,928
|
)
|
|
$
|
(171
|
)
|
|
$
|
(3,984
|
)
|
|
$
|
(28,859
|
)
|
|
$
|
(102
|
)
|
|
$
|
(4,317
|
)
|
Prior service cost
|
|
(123
|
)
|
|
—
|
|
|
(24
|
)
|
|
(109
|
)
|
|
—
|
|
|
(31
|
)
|
||||||
|
|
(29,051
|
)
|
|
(171
|
)
|
|
(4,008
|
)
|
|
(28,968
|
)
|
|
(102
|
)
|
|
(4,348
|
)
|
||||||
Deferred tax benefit (expense)
|
|
6,100
|
|
|
35
|
|
|
841
|
|
|
9,674
|
|
|
15
|
|
|
1,276
|
|
||||||
Reclassification of certain deferred tax effects
(1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,591
|
)
|
|
6
|
|
|
(364
|
)
|
||||||
Accumulated other comprehensive (loss) income, net of tax
|
|
$
|
(22,951
|
)
|
|
$
|
(136
|
)
|
|
$
|
(3,167
|
)
|
|
$
|
(22,885
|
)
|
|
$
|
(81
|
)
|
|
$
|
(3,436
|
)
|
(1)
|
Amounts reclassified to retained earnings due to early adoption of ASU 2018-02. See “Note 1 – Summary of Significant Accounting and Reporting Policies” for further information.
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Defined Benefit Pension Plan:
|
|
|
||||||||||
Service cost
|
|
$
|
1,548
|
|
|
$
|
1,398
|
|
|
$
|
1,375
|
|
Interest cost
|
|
3,392
|
|
|
3,601
|
|
|
3,731
|
|
|||
Expected return on assets
|
|
(6,483
|
)
|
|
(6,050
|
)
|
|
(5,224
|
)
|
|||
Net loss amortization
|
|
1,512
|
|
|
1,312
|
|
|
1,642
|
|
|||
Prior service credit amortization
|
|
(14
|
)
|
|
(14
|
)
|
|
(14
|
)
|
|||
Special and contractual termination benefits
|
|
—
|
|
|
—
|
|
|
1,549
|
|
|||
Net periodic benefit cost
|
|
$
|
(45
|
)
|
|
$
|
247
|
|
|
$
|
3,059
|
|
Defined Benefit Pension Plan Acquired:
|
|
|
||||||||||
Service cost
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest cost
|
|
163
|
|
|
177
|
|
|
212
|
|
|||
Expected return on assets
|
|
(290
|
)
|
|
(212
|
)
|
|
(265
|
)
|
|||
Net loss amortization
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Prior service credit amortization
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Loss (gain) recognized due to settlement
|
|
—
|
|
|
8
|
|
|
(8
|
)
|
|||
Net periodic benefit cost
|
|
$
|
(127
|
)
|
|
$
|
(27
|
)
|
|
$
|
(61
|
)
|
Restoration Plan:
|
|
|
|
|
|
|
||||||
Service cost
|
|
$
|
293
|
|
|
$
|
247
|
|
|
$
|
207
|
|
Interest cost
|
|
597
|
|
|
567
|
|
|
535
|
|
|||
Net loss amortization
|
|
677
|
|
|
301
|
|
|
186
|
|
|||
Prior service cost amortization
|
|
7
|
|
|
6
|
|
|
6
|
|
|||
Net periodic benefit cost
|
|
$
|
1,574
|
|
|
$
|
1,121
|
|
|
$
|
934
|
|
|
|
Defined
Benefit
Pension
Plan
|
|
Defined
Benefit Pension Plan Acquired |
|
Restoration
Plan |
||||||
Net loss
|
|
$
|
1,774
|
|
|
$
|
—
|
|
|
$
|
398
|
|
Prior service (credit) cost
|
|
(14
|
)
|
|
—
|
|
|
6
|
|
|||
|
|
1,760
|
|
|
—
|
|
|
404
|
|
|||
Deferred tax benefit
|
|
(370
|
)
|
|
—
|
|
|
(85
|
)
|
|||
Accumulated other comprehensive loss, net of tax
|
|
$
|
1,390
|
|
|
$
|
—
|
|
|
$
|
319
|
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||||||||
|
|
Defined Benefit
Pension Plan |
|
Defined
Benefit Pension Plan Acquired |
|
Restoration
Plan |
|
Defined
Benefit Pension Plan |
|
Defined
Benefit Pension Plan Acquired |
|
Restoration
Plan |
||||||
Discount rate
|
|
4.32
|
%
|
|
4.32
|
%
|
|
4.32
|
%
|
|
3.71
|
%
|
|
3.71
|
%
|
|
3.71
|
%
|
Compensation increase rate
|
|
3.50
|
%
|
|
—
|
|
|
3.50
|
%
|
|
3.50
|
%
|
|
—
|
|
|
3.50
|
%
|
|
|
Year Ended December 31,
|
|||||||
|
|
2018
|
|
2017
|
|
2016
|
|||
Defined Benefit Pension Plan:
|
|
|
|
|
|
|
|||
Discount rate
|
|
3.71
|
%
|
|
4.23
|
%
|
|
4.56
|
%
|
Expected long-term rate of return on plan assets
|
|
7.25
|
%
|
|
7.25
|
%
|
|
7.25
|
%
|
Compensation increase rate
|
|
3.50
|
%
|
|
3.50
|
%
|
|
3.50
|
%
|
Defined Benefit Pension Plan Acquired
|
|
|
|
|
|
|
|||
Discount rate
|
|
3.71
|
%
|
|
4.23
|
%
|
|
4.56
|
%
|
Expected long-term rate of return on plan assets
|
|
7.25
|
%
|
|
7.25
|
%
|
|
7.25
|
%
|
Compensation increase rate
|
|
—
|
|
|
—
|
|
|
—
|
|
Restoration Plan:
|
|
|
|
|
|
|
|
|
|
Discount rate
|
|
3.71
|
%
|
|
4.23
|
%
|
|
4.56
|
%
|
Compensation increase rate
|
|
3.50
|
%
|
|
3.50
|
%
|
|
3.50
|
%
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||||||
|
|
Defined
Benefit Pension Plan |
|
Defined
Benefit Pension Plan Acquired |
|
Defined
Benefit Pension Plan |
|
Defined
Benefit Pension Plan Acquired |
||||||||
Level 1:
|
|
|
||||||||||||||
Cash
|
|
$
|
278
|
|
|
$
|
—
|
|
|
$
|
423
|
|
|
$
|
—
|
|
Equity Securities:
|
|
|
|
|
|
|
|
|
|
|
||||||
U.S. large cap
(1)
|
|
5,204
|
|
|
—
|
|
|
6,198
|
|
|
—
|
|
||||
U.S. mid cap
(2)
|
|
18,913
|
|
|
—
|
|
|
21,379
|
|
|
—
|
|
||||
U.S. small cap
(3)
|
|
9,900
|
|
|
—
|
|
|
10,706
|
|
|
—
|
|
||||
Fixed Income Securities:
|
|
|
|
|
|
|
|
|
||||||||
International developed
(4)
|
|
6,733
|
|
|
—
|
|
|
8,601
|
|
|
—
|
|
||||
International emerging
(2)
|
|
3,464
|
|
|
—
|
|
|
4,308
|
|
|
—
|
|
||||
Level 2:
|
|
|
|
|
|
|
|
|
|
|
||||||
Cash Equivalents
|
|
15,025
|
|
|
—
|
|
|
13,256
|
|
|
—
|
|
||||
Equity Securities:
|
|
|
|
|
|
|
|
|
||||||||
U.S. large cap
(1)
|
|
—
|
|
|
1,360
|
|
|
—
|
|
|
1,440
|
|
||||
U.S. mid cap
(2)
|
|
—
|
|
|
152
|
|
|
—
|
|
|
167
|
|
||||
U.S. small cap
(3)
|
|
—
|
|
|
72
|
|
|
—
|
|
|
84
|
|
||||
International
(5)
|
|
—
|
|
|
735
|
|
|
—
|
|
|
712
|
|
||||
Fixed Income Securities:
|
|
|
|
|
|
|
|
|
|
|||||||
Corporate bonds
(6)
|
|
952
|
|
|
407
|
|
|
1,118
|
|
|
378
|
|
||||
U.S. government agencies
(6)
|
|
20,182
|
|
|
—
|
|
|
19,303
|
|
|
—
|
|
||||
Municipal bonds
(6)
|
|
3,991
|
|
|
—
|
|
|
5,595
|
|
|
—
|
|
||||
U.S. agency mortgage-backed securities
(7)
|
|
269
|
|
|
—
|
|
|
346
|
|
|
—
|
|
||||
Asset-backed securities
(8)
|
|
—
|
|
|
743
|
|
|
—
|
|
|
717
|
|
||||
Real estate
(9)
|
|
—
|
|
|
286
|
|
|
—
|
|
|
241
|
|
||||
Balanced Asset Allocation
(10)
|
|
—
|
|
|
84
|
|
|
—
|
|
|
81
|
|
||||
Other
(11)
|
|
—
|
|
|
231
|
|
|
—
|
|
|
211
|
|
||||
Total fair value of plan assets
|
|
$
|
84,911
|
|
|
$
|
4,070
|
|
|
$
|
91,233
|
|
|
$
|
4,031
|
|
(1)
|
For the defined benefit pension plan, this category is comprised of individual securities that are actively managed and a broadly diversified “passive” mutual fund. The Acquired Plan assets in this category consist of pooled separate accounts invested in mutual funds and domestic stocks.
|
(2)
|
For the defined benefit pension plan, this category is comprised of broadly diversified “passive” mutual funds. The Acquired Plan assets in this category consist of pooled separate accounts invested in mutual funds and domestic stocks.
|
(3)
|
For the defined benefit pension plan, this category is comprised of broadly diversified “passive” mutual funds and shares of Southside Bancshares stock that is owned in the Plan. The Acquired Plan assets in this category consist of pooled separate accounts invested in mutual funds and domestic stocks.
|
(4)
|
This category is comprised of individual securities that are actively managed and a broadly diversified “passive” mutual fund.
|
(5)
|
This category is comprised of pooled separate accounts invested in mutual funds and international stocks.
|
(6)
|
For the defined benefit pension plan, this category is comprised of individual investment grade securities that are generally held to maturity in the Plan. The Acquired Plan assets in this category consist of pooled separate accounts invested in investment grade and below investment grade bonds.
|
(7)
|
This category is comprised of individual securities that are generally not held to maturity.
|
(8)
|
This category is mainly comprised of a pooled separate account invested in asset backed securities, residential mortgage backed securities, commercial mortgage backed securities and corporate bonds.
|
(9)
|
This category is comprised of a pooled separate account invested in commercial real estate and includes mortgage loans which are backed by the associated properties.
|
(10)
|
This category is comprised of a pooled separate account invested in a single mutual fund invested in a combination of fixed income and equity investment options.
|
(11)
|
This category is comprised of a pooled separate account invested in a broad range of instruments including, but not limited to, equities, bonds, currencies, convertible securities and derivatives such as futures, options, swaps and forwards.
|
|
Defined Benefit
Pension Plan
|
|
Defined Benefit
Pension Plan Acquired |
|
Restoration
Plan |
||||||
2019
|
$
|
3,836
|
|
|
$
|
66
|
|
|
$
|
723
|
|
2020
|
3,951
|
|
|
229
|
|
|
780
|
|
|||
2021
|
4,142
|
|
|
129
|
|
|
916
|
|
|||
2022
|
4,354
|
|
|
90
|
|
|
1,031
|
|
|||
2023
|
4,520
|
|
|
92
|
|
|
1,005
|
|
|||
2024 through 2028
|
25,008
|
|
|
897
|
|
|
5,521
|
|
|||
|
$
|
45,811
|
|
|
$
|
1,503
|
|
|
$
|
9,976
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
New shares issued from available authorized shares
|
—
|
|
|
48,311
|
|
|
108,225
|
|
|||
New shares issued from available treasury shares
|
140,692
|
|
|
111,045
|
|
|
—
|
|
|||
Total
|
140,692
|
|
|
159,356
|
|
|
108,225
|
|
|||
|
|
|
|
|
|
||||||
Proceeds from stock option exercises
|
$
|
2,653
|
|
|
$
|
2,692
|
|
|
$
|
1,663
|
|
|
|
Years Ended December 31,
|
||||
|
|
2018
|
|
2017
|
|
2016
|
Weighted-average grant date fair value per option
|
|
$6.78
|
|
—
|
|
$7.18
|
Weighted-average assumptions:
|
|
|
|
|
|
|
Risk-free interest rates
|
|
2.81%
|
|
—
|
|
1.79%
|
Expected dividend yield
|
|
1.10%
|
|
—
|
|
2.69%
|
Expected volatility factors of the market price of Southside Bancshares common stock
|
|
25.41%
|
|
—
|
|
27.02%
|
Expected option life (in years)
|
|
6.2
|
|
—
|
|
6.2
|
|
|
Restricted Stock Units
Outstanding
|
|
Stock Options Outstanding
|
||||||||||||||
|
|
Number
of Shares
|
|
Weighted-
Average
Grant-Date
Fair
Value
|
|
Number
of Shares
|
|
Weighted-
Average
Exercise
Price
|
|
Weighted-
Average
Grant-Date
Fair
Value
|
||||||||
Balance, January 1, 2018
|
|
78,253
|
|
|
$
|
32.04
|
|
|
690,312
|
|
|
$
|
26.02
|
|
|
$
|
6.19
|
|
Granted
|
|
64,358
|
|
|
34.28
|
|
|
356,849
|
|
|
34.52
|
|
|
6.78
|
|
|||
Stock options exercised
|
|
—
|
|
|
—
|
|
|
(115,277
|
)
|
|
23.02
|
|
|
5.69
|
|
|||
Stock awards vested
|
|
(29,752
|
)
|
|
31.14
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Forfeited
|
|
(3,109
|
)
|
|
32.93
|
|
|
(16,980
|
)
|
|
32.51
|
|
|
6.67
|
|
|||
Canceled/expired
|
|
—
|
|
|
—
|
|
|
(5,553
|
)
|
|
30.06
|
|
|
6.68
|
|
|||
Balance, December 31, 2018
|
|
109,750
|
|
|
$
|
33.57
|
|
|
909,351
|
|
|
$
|
29.59
|
|
|
$
|
6.47
|
|
|
|
Options Outstanding
|
|
Options Exercisable
|
||||||||||||||||
Range of Exercise Prices
|
|
Number
of Shares |
|
Weighted-
Average Exercise Price |
|
Weighted-
Average Remaining Contractual Life in Years |
|
Number
of Shares |
|
Weighted-
Average Exercise Price |
||||||||||
$
|
14.67
|
|
-
|
$20.00
|
|
110,291
|
|
|
$
|
15.89
|
|
|
3.03
|
|
110,291
|
|
|
$
|
15.89
|
|
20.01
|
|
-
|
25.00
|
|
106,826
|
|
|
22.92
|
|
|
5.43
|
|
82,747
|
|
|
23.01
|
|
|||
25.01
|
|
-
|
30.00
|
|
202,009
|
|
|
26.68
|
|
|
6.47
|
|
136,613
|
|
|
26.58
|
|
|||
30.01
|
|
-
|
35.00
|
|
346,965
|
|
|
34.52
|
|
|
9.41
|
|
—
|
|
|
—
|
|
|||
35.01
|
|
-
|
37.28
|
|
143,260
|
|
|
37.28
|
|
|
7.90
|
|
76,710
|
|
|
37.28
|
|
|||
Total
|
|
909,351
|
|
|
$
|
29.59
|
|
|
7.28
|
|
406,361
|
|
|
$
|
24.97
|
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
|
|
Estimated Fair Value
|
|
Estimated Fair Value
|
||||||||||||||||||||
|
|
Notional Amount
(1)
|
|
Asset Derivative
|
|
Liability Derivative
|
|
Notional
Amount (1) |
|
Asset Derivative
|
|
Liability Derivative
|
||||||||||||
Derivatives designated as hedging instruments
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Interest rate contracts:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Swaps-Cash Flow Hedge-Financial institution counterparties
|
|
$
|
270,000
|
|
|
$
|
9,388
|
|
|
$
|
457
|
|
|
$
|
240,000
|
|
|
$
|
7,922
|
|
|
$
|
22
|
|
Swaps-Fair Value Hedge-Financial institution counterparties
|
|
21,100
|
|
|
—
|
|
|
657
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Derivatives designated as non-hedging instruments
|
||||||||||||||||||||||||
Interest rate contracts:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Swaps-Financial institution counterparties
|
|
93,967
|
|
|
1,119
|
|
|
1,087
|
|
|
67,220
|
|
|
92
|
|
|
612
|
|
||||||
Swaps-Customer counterparties
|
|
93,967
|
|
|
1,087
|
|
|
1,119
|
|
|
67,220
|
|
|
612
|
|
|
92
|
|
||||||
Gross derivatives
|
|
|
|
11,594
|
|
|
3,320
|
|
|
|
|
8,626
|
|
|
726
|
|
||||||||
Offsetting derivative assets/liabilities
|
|
|
|
(2,201
|
)
|
|
(2,201
|
)
|
|
|
|
(114
|
)
|
|
(114
|
)
|
||||||||
Cash collateral received/posted
|
|
|
|
(8,306
|
)
|
|
—
|
|
|
|
|
(7,900
|
)
|
|
(520
|
)
|
||||||||
Net derivatives included in the consolidated balance sheets
(2)
|
|
|
|
$
|
1,087
|
|
|
$
|
1,119
|
|
|
|
|
$
|
612
|
|
|
$
|
92
|
|
(1)
|
Notional amounts, which represent the extent of involvement in the derivatives market, are used to determine the contractual cash flows required in accordance with the terms of the agreement. These amounts are typically not exchanged, significantly exceed amounts subject to credit or market risk and are not reflected in the consolidated balance sheets.
|
(2)
|
Net derivative assets are included in other assets and net derivative liabilities are included in other liabilities on the consolidated balance sheets. Included in the fair value of net derivative assets and net derivative liabilities are credit valuation adjustments reflecting counterparty credit risk and our credit risk. We had
no
credit exposure related to interest rate swaps with financial institutions and
$1.1 million
related to interest rate swaps with customers at
December 31, 2018
. We had net credit exposure of
$30,000
related to interest rate swaps with financial institutions and
$612,000
related to interest rate swaps with customers
at
December 31, 2017
. The credit risk associated with customer transactions is partially mitigated as these are generally secured by the non-cash collateral securing the underlying transaction being hedged.
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
|
|
|
|
Weighted Average
|
|
|
|
Weighted Average
|
||||||||||||||||
|
|
Notional Amount
|
|
Remaining Maturity
(in years)
|
|
Receive Rate
|
|
Pay
Rate
|
|
Notional Amount
|
|
Remaining Maturity
(in years) |
|
Receive Rate
|
|
Pay
Rate |
||||||||
Swaps-Cash Flow Hedge
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Financial institution counterparties
|
|
$
|
270,000
|
|
|
4.8
|
|
2.45
|
%
|
|
1.58
|
%
|
|
$
|
240,000
|
|
|
5.3
|
|
1.44
|
%
|
|
1.43
|
%
|
Swaps-Fair Value Hedge
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Financial institution counterparties
|
|
21,100
|
|
|
7.5
|
|
2.56
|
|
|
3.00
|
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
||
Swaps-Non-Hedging
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Financial institution counterparties
|
|
93,967
|
|
|
11.6
|
|
2.36
|
|
|
2.58
|
|
|
67,220
|
|
|
12.7
|
|
1.39
|
|
|
2.37
|
|
||
Customer counterparties
|
|
93,967
|
|
|
11.6
|
|
2.58
|
|
|
2.36
|
|
|
67,220
|
|
|
12.7
|
|
2.37
|
|
|
1.39
|
|
|
December 31, 2018
|
||||||||||||||
|
|
|
Fair Value Measurements at the End of the Reporting Period Using
|
||||||||||||
|
Carrying
Amount
|
|
Quoted Prices in Active Markets for Identical Assets
(Level 1)
|
|
Significant Other Observable Inputs
(Level 2)
|
|
Significant Unobservable Inputs
(Level 3)
|
||||||||
Recurring fair value measurements
|
|
|
|
|
|
|
|
||||||||
Investment Securities:
|
|
|
|
|
|
|
|
||||||||
State and Political Subdivisions
|
$
|
716,601
|
|
|
$
|
—
|
|
|
$
|
716,601
|
|
|
$
|
—
|
|
Other Stocks and Bonds
|
2,709
|
|
|
—
|
|
|
2,709
|
|
|
—
|
|
||||
Mortgage-backed Securities:
(1)
|
|
|
|
|
|
|
|
|
|
||||||
Residential
|
732,972
|
|
|
—
|
|
|
732,972
|
|
|
—
|
|
||||
Commercial
|
537,154
|
|
|
—
|
|
|
537,154
|
|
|
—
|
|
||||
Equity Investments:
|
|
|
|
|
|
|
|
||||||||
Equity Investments
(2)
|
5,791
|
|
|
5,791
|
|
|
—
|
|
|
—
|
|
||||
Derivative assets:
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
11,594
|
|
|
—
|
|
|
11,594
|
|
|
—
|
|
||||
Total asset recurring fair value measurements
|
$
|
2,006,821
|
|
|
$
|
5,791
|
|
|
$
|
2,001,030
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
Derivative liabilities:
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
$
|
3,320
|
|
|
$
|
—
|
|
|
$
|
3,320
|
|
|
$
|
—
|
|
Total liability recurring fair value measurements
|
$
|
3,320
|
|
|
$
|
—
|
|
|
$
|
3,320
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
Nonrecurring fair value measurements
|
|
|
|
|
|
|
|
|
|
|
|
||||
Foreclosed assets
|
$
|
1,206
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,206
|
|
Impaired loans
(3)
|
37,813
|
|
|
—
|
|
|
—
|
|
|
37,813
|
|
||||
Total asset nonrecurring fair value measurements
|
$
|
39,019
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
39,019
|
|
|
December 31, 2017
|
||||||||||||||
|
|
|
Fair Value Measurements at the End of the Reporting Period Using
|
||||||||||||
|
Carrying
Amount
|
|
Quoted Prices in Active Markets for Identical Assets
(Level 1)
|
|
Significant Other Observable Inputs
(Level 2)
|
|
Significant Unobservable Inputs
(Level 3)
|
||||||||
Recurring fair value measurements
|
|
|
|
|
|
|
|
||||||||
Investment Securities:
|
|
|
|
|
|
|
|
||||||||
U.S. Government Agency Debentures
|
$
|
108,869
|
|
|
$
|
—
|
|
|
$
|
108,869
|
|
|
$
|
—
|
|
State and Political Subdivisions
|
392,664
|
|
|
—
|
|
|
392,664
|
|
|
—
|
|
||||
Other Stocks and Bonds
|
5,055
|
|
|
—
|
|
|
5,055
|
|
|
—
|
|
||||
Equity Investments
(2)
|
5,920
|
|
|
5,920
|
|
|
—
|
|
|
—
|
|
||||
Mortgage-backed Securities:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
||||
Residential
|
718,029
|
|
|
—
|
|
|
718,029
|
|
|
—
|
|
||||
Commercial
|
308,218
|
|
|
—
|
|
|
308,218
|
|
|
—
|
|
||||
Derivative assets:
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
8,626
|
|
|
—
|
|
|
8,626
|
|
|
—
|
|
||||
Total asset recurring fair value measurements
|
$
|
1,547,381
|
|
|
$
|
5,920
|
|
|
$
|
1,541,461
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
Derivative liabilities:
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
$
|
726
|
|
|
$
|
—
|
|
|
$
|
726
|
|
|
$
|
—
|
|
Total liability recurring fair value measurements
|
$
|
726
|
|
|
$
|
—
|
|
|
$
|
726
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
Nonrecurring fair value measurements
|
|
|
|
|
|
|
|
|
|
|
|
||||
Foreclosed assets
|
$
|
1,767
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,767
|
|
Impaired loans
(3)
|
6,536
|
|
|
—
|
|
|
—
|
|
|
6,536
|
|
||||
Total asset nonrecurring fair value measurements
|
$
|
8,303
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8,303
|
|
(1)
|
All mortgage-backed securities are issued and/or guaranteed by U.S. government agencies or U.S. government-sponsored enterprises.
|
(2)
|
With the adoption of ASU 2016-01 on January 1, 2018, these investments are included in equity investments on our consolidated balance sheets. The guidance was applied on a prospective approach resulting in prior-periods no longer being comparable. See “Note 1 - Summary of Significant Accounting and Reporting Policies” for further information.
|
(3)
|
Impaired loans represent collateral-dependent loans with a specific valuation allowance. Losses on these loans represent charge-offs which are netted against the allowance for loan losses.
|
|
|
|
Estimated Fair Value
|
||||||||||||||||
December 31, 2018
|
Carrying
Amount |
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||
Financial Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
120,719
|
|
|
$
|
120,719
|
|
|
$
|
120,719
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Investment Securities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Held to maturity, at carrying value
|
3,083
|
|
|
3,046
|
|
|
—
|
|
|
3,046
|
|
|
—
|
|
|||||
Mortgage-backed Securities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Held to maturity, at carrying value
|
159,848
|
|
|
156,735
|
|
|
—
|
|
|
156,735
|
|
|
—
|
|
|||||
FHLB stock, at cost
|
32,583
|
|
|
32,583
|
|
|
—
|
|
|
32,583
|
|
|
—
|
|
|||||
Equity investments
|
6,302
|
|
|
6,302
|
|
|
—
|
|
|
6,302
|
|
|
—
|
|
|||||
Loans, net of allowance for loan losses
|
3,285,780
|
|
|
3,251,923
|
|
|
—
|
|
|
—
|
|
|
3,251,923
|
|
|||||
Loans held for sale
|
601
|
|
|
601
|
|
|
—
|
|
|
601
|
|
|
—
|
|
|||||
Financial Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Deposits
|
$
|
4,425,030
|
|
|
$
|
4,417,902
|
|
|
$
|
—
|
|
|
$
|
4,417,902
|
|
|
$
|
—
|
|
Federal funds purchased and repurchase agreements
|
36,810
|
|
|
36,810
|
|
|
—
|
|
|
36,810
|
|
|
—
|
|
|||||
FHLB borrowings
|
719,065
|
|
|
708,904
|
|
|
—
|
|
|
708,904
|
|
|
—
|
|
|||||
Subordinated notes, net of unamortized debt issuance costs
|
98,407
|
|
|
97,611
|
|
|
—
|
|
|
97,611
|
|
|
—
|
|
|||||
Trust preferred subordinated debentures, net of unamortized debt issuance costs
|
60,246
|
|
|
54,729
|
|
|
—
|
|
|
54,729
|
|
|
—
|
|
|
|
|
Estimated Fair Value
|
||||||||||||||||
December 31, 2017
|
Carrying
Amount |
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||
Financial Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
198,692
|
|
|
$
|
198,692
|
|
|
$
|
198,692
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Investment Securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Held to maturity, at carrying value
|
413,632
|
|
|
421,928
|
|
|
—
|
|
|
421,928
|
|
|
—
|
|
|||||
Mortgage-backed Securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Held to maturity, at carrying value
|
495,874
|
|
|
499,872
|
|
|
—
|
|
|
499,872
|
|
|
—
|
|
|||||
FHLB stock, at cost
|
55,729
|
|
|
55,729
|
|
|
—
|
|
|
55,729
|
|
|
—
|
|
|||||
Equity investments
|
5,821
|
|
|
5,821
|
|
|
—
|
|
|
5,821
|
|
|
—
|
|
|||||
Loans, net of allowance for loan losses
|
3,273,575
|
|
|
3,269,316
|
|
|
—
|
|
|
—
|
|
|
3,269,316
|
|
|||||
Loans held for sale
|
2,001
|
|
|
2,001
|
|
|
—
|
|
|
2,001
|
|
|
—
|
|
|||||
Financial Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Deposits
|
$
|
4,515,447
|
|
|
$
|
4,506,133
|
|
|
$
|
—
|
|
|
$
|
4,506,133
|
|
|
$
|
—
|
|
Federal funds purchased and repurchase agreements
|
9,498
|
|
|
9,498
|
|
|
—
|
|
|
9,498
|
|
|
—
|
|
|||||
FHLB borrowings
|
1,017,361
|
|
|
1,008,292
|
|
|
—
|
|
|
1,008,292
|
|
|
—
|
|
|||||
Subordinated notes, net of unamortized debt issuance costs
|
98,248
|
|
|
99,665
|
|
|
—
|
|
|
99,665
|
|
|
—
|
|
|||||
Trust preferred subordinated debentures, net of unamortized debt issuance costs
|
60,241
|
|
|
47,622
|
|
|
—
|
|
|
47,622
|
|
|
—
|
|
|
|
Actual
|
|
For Capital
Adequacy Purposes
|
|
To Be Well Capitalized
Under Prompt
Corrective Actions
Provisions
|
|||||||||||||||
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|
Amount
|
|
Ratio
|
|||||||||
December 31, 2018:
|
|
(dollars in thousands)
|
|||||||||||||||||||
Common Equity Tier 1 (to Risk Weighted Assets)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Consolidated
|
|
$
|
568,283
|
|
|
14.77
|
%
|
|
$
|
173,174
|
|
|
4.50
|
%
|
|
N/A
|
|
|
N/A
|
|
|
Bank Only
|
|
$
|
714,991
|
|
|
18.59
|
%
|
|
$
|
173,095
|
|
|
4.50
|
%
|
|
$
|
250,026
|
|
|
6.50
|
%
|
Tier 1 Capital (to Risk Weighted Assets)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Consolidated
|
|
$
|
626,718
|
|
|
16.29
|
%
|
|
$
|
230,899
|
|
|
6.00
|
%
|
|
N/A
|
|
|
N/A
|
|
|
Bank Only
|
|
$
|
714,991
|
|
|
18.59
|
%
|
|
$
|
230,793
|
|
|
6.00
|
%
|
|
$
|
307,725
|
|
|
8.00
|
%
|
Total Capital (to Risk Weighted Assets)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Consolidated
|
|
$
|
754,034
|
|
|
19.59
|
%
|
|
$
|
307,865
|
|
|
8.00
|
%
|
|
N/A
|
|
|
N/A
|
|
|
Bank Only
|
|
$
|
743,900
|
|
|
19.34
|
%
|
|
$
|
307,725
|
|
|
8.00
|
%
|
|
$
|
384,656
|
|
|
10.00
|
%
|
Tier 1 Capital (to Average Assets)
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Consolidated
|
|
$
|
626,718
|
|
|
10.64
|
%
|
|
$
|
235,689
|
|
|
4.00
|
%
|
|
N/A
|
|
|
N/A
|
|
|
Bank Only
|
|
$
|
714,991
|
|
|
12.14
|
%
|
|
$
|
235,532
|
|
|
4.00
|
%
|
|
$
|
294,415
|
|
|
5.00
|
%
|
December 31, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Common Equity Tier 1 (to Risk Weighted Assets)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Consolidated
|
|
$
|
570,610
|
|
|
14.65
|
%
|
|
$
|
175,216
|
|
|
4.50
|
%
|
|
N/A
|
|
|
N/A
|
|
|
Bank Only
|
|
$
|
711,157
|
|
|
18.27
|
%
|
|
$
|
175,145
|
|
|
4.50
|
%
|
|
$
|
252,987
|
|
|
6.50
|
%
|
Tier 1 Capital (to Risk Weighted Assets)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Consolidated
|
|
$
|
627,532
|
|
|
16.12
|
%
|
|
$
|
233,621
|
|
|
6.00
|
%
|
|
N/A
|
|
|
N/A
|
|
|
Bank Only
|
|
$
|
711,157
|
|
|
18.27
|
%
|
|
$
|
233,527
|
|
|
6.00
|
%
|
|
$
|
311,369
|
|
|
8.00
|
%
|
Total Capital (to Risk Weighted Assets)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Consolidated
|
|
$
|
748,532
|
|
|
19.22
|
%
|
|
$
|
311,495
|
|
|
8.00
|
%
|
|
N/A
|
|
|
N/A
|
|
|
Bank Only
|
|
$
|
733,909
|
|
|
18.86
|
%
|
|
$
|
311,369
|
|
|
8.00
|
%
|
|
$
|
389,211
|
|
|
10.00
|
%
|
Tier 1 Capital (to Average Assets)
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Consolidated
|
|
$
|
627,532
|
|
|
11.16
|
%
|
|
$
|
224,844
|
|
|
4.00
|
%
|
|
N/A
|
|
|
N/A
|
|
|
Bank Only
|
|
$
|
711,157
|
|
|
12.66
|
%
|
|
$
|
224,741
|
|
|
4.00
|
%
|
|
$
|
280,926
|
|
|
5.00
|
%
|
(1)
|
Refers to quarterly average assets as calculated in accordance with policies established by bank regulatory agencies.
|
|
|
Years Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Current income tax expense
|
|
$
|
4,009
|
|
|
$
|
12,607
|
|
|
$
|
8,557
|
|
Deferred income tax expense
|
|
6,154
|
|
|
3,514
|
|
|
1,768
|
|
|||
Income tax expense
|
|
$
|
10,163
|
|
|
$
|
16,121
|
|
|
$
|
10,325
|
|
|
|
Assets
|
|
Liabilities
|
|||
Allowance for loan losses
|
|
$
|
5,673
|
|
|
$
|
|
Retirement and other benefit plans
|
|
|
|
|
(2,519
|
)
|
|
Premises and equipment
|
|
|
|
(6,360
|
)
|
||
Core deposit intangible
|
|
|
|
(2,748
|
)
|
||
Unrealized losses on securities available for sale
|
|
7,926
|
|
|
|
||
Effective hedging derivatives
|
|
|
|
(1,761
|
)
|
||
Fair value adjustment on loans
|
|
1,894
|
|
|
|
||
Fair value adjustment on time deposits
|
|
|
|
(6
|
)
|
||
Unfunded status of defined benefit plan
|
|
6,979
|
|
|
|
|
|
State business tax credit
|
|
483
|
|
|
|
|
|
Stock-based compensation
|
|
797
|
|
|
|
|
|
Other
|
|
|
|
|
(582
|
)
|
|
Gross deferred tax assets (liabilities)
|
|
23,752
|
|
|
(13,976
|
)
|
|
Net deferred tax asset at December 31, 2018
|
|
$
|
9,776
|
|
|
|
|
|
|
|
|
|
|||
Allowance for loan losses
|
|
$
|
4,364
|
|
|
$
|
|
Retirement and other benefit plans
|
|
|
|
|
(2,102
|
)
|
|
Premises and equipment
|
|
|
|
|
(5,716
|
)
|
|
Core deposit intangible
|
|
|
|
(3,660
|
)
|
||
Unrealized losses on securities available for sale
|
|
4,285
|
|
|
|
|
|
Effective hedging derivatives
|
|
|
|
(1,701
|
)
|
||
Fair value adjustment on loans
|
|
2,607
|
|
|
|
||
Fair value adjustment on time deposits
|
|
|
|
|
(54
|
)
|
|
Alternative minimum tax credit
|
|
6,943
|
|
|
|
||
Unfunded status of defined benefit plan
|
|
7,018
|
|
|
|
|
|
State business tax credit
|
|
544
|
|
|
|
|
|
Stock-based compensation
|
|
642
|
|
|
|
|
|
Other
|
|
|
|
|
(966
|
)
|
|
Gross deferred tax assets (liabilities)
|
|
26,403
|
|
|
(14,199
|
)
|
|
Net deferred tax asset at December 31, 2017
|
|
$
|
12,204
|
|
|
|
|
|
|
Years Ended December 31,
|
|||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|||||||||||||||
|
|
Amount
|
|
Percent of Pre-Tax Income
|
|
Amount
|
|
Percent of Pre-Tax Income
|
|
Amount
|
|
Percent of Pre-Tax Income
|
|||||||||
Statutory tax expense
|
|
$
|
17,703
|
|
|
21.0
|
%
|
|
$
|
24,652
|
|
|
35.0
|
%
|
|
$
|
20,886
|
|
|
35.0
|
%
|
Increase (decrease) in taxes from:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Tax rate changes
|
|
(767
|
)
|
|
(0.9
|
)%
|
|
2,416
|
|
|
3.4
|
%
|
|
—
|
|
|
—
|
|
|||
Tax exempt interest
|
|
(6,257
|
)
|
|
(7.4
|
)%
|
|
(10,195
|
)
|
|
(14.5
|
)%
|
|
(9,879
|
)
|
|
(16.6
|
)%
|
|||
Bank owned life insurance
|
|
(613
|
)
|
|
(0.7
|
)%
|
|
(885
|
)
|
|
(1.2
|
)%
|
|
(915
|
)
|
|
(1.5
|
)%
|
|||
Share-based compensation
|
|
(191
|
)
|
|
(0.2
|
)%
|
|
(482
|
)
|
|
(0.7
|
)%
|
|
—
|
|
|
—
|
|
|||
Acquisition costs
|
|
—
|
|
|
—
|
|
|
467
|
|
|
0.7
|
%
|
|
—
|
|
|
—
|
|
|||
State business tax
|
|
297
|
|
|
0.3
|
%
|
|
68
|
|
|
0.1
|
%
|
|
71
|
|
|
0.1
|
%
|
|||
Other, net
|
|
(9
|
)
|
|
—
|
|
|
80
|
|
|
0.1
|
%
|
|
162
|
|
|
0.3
|
%
|
|||
Income tax expense
|
|
$
|
10,163
|
|
|
12.1
|
%
|
|
$
|
16,121
|
|
|
22.9
|
%
|
|
$
|
10,325
|
|
|
17.3
|
%
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
Unused commitments:
|
|
|
|
|
|
||
Commitments to extend credit
|
$
|
874,557
|
|
|
$
|
804,715
|
|
Standby letters of credit
|
27,438
|
|
|
14,890
|
|
||
Total
|
$
|
901,995
|
|
|
$
|
819,605
|
|
2019
|
$
|
1,265
|
|
2020
|
1,158
|
|
|
2021
|
906
|
|
|
2022
|
742
|
|
|
2023
|
560
|
|
|
2024 and thereafter
|
1,352
|
|
|
|
$
|
5,983
|
|
2019
|
$
|
2,574
|
|
2020
|
2,427
|
|
|
2021
|
1,374
|
|
|
2022
|
1,352
|
|
|
2023
|
1,119
|
|
|
2024 and thereafter
|
3,996
|
|
|
|
$
|
12,842
|
|
CONDENSED BALANCE SHEETS
|
|
December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
ASSETS
|
|
|
|
|
|
|
||
Cash and due from banks
|
|
$
|
11,431
|
|
|
$
|
8,483
|
|
Investment in bank subsidiaries at equity in underlying net assets
|
|
875,814
|
|
|
894,010
|
|
||
Investment in nonbank subsidiaries at equity in underlying net assets
|
|
1,826
|
|
|
1,826
|
|
||
Other assets
|
|
4,290
|
|
|
10,350
|
|
||
Total assets
|
|
$
|
893,361
|
|
|
$
|
914,669
|
|
LIABILITIES
|
|
|
|
|
|
|
||
Subordinated notes, net of unamortized debt issuance costs
|
|
$
|
98,407
|
|
|
$
|
98,248
|
|
Trust preferred subordinated debentures, net of unamortized debt issuance costs
|
|
60,246
|
|
|
60,241
|
|
||
Other liabilities
|
|
3,417
|
|
|
2,040
|
|
||
Total liabilities
|
|
162,070
|
|
|
160,529
|
|
||
SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
||
Common stock: ($1.25 par value, 80,000,000 shares authorized, 37,845,224 shares issued at December 31, 2018 and 40,000,000 shares authorized and 37,802,352 shares issued at December 31, 2017)
|
|
47,307
|
|
|
47,253
|
|
||
Paid-in capital
|
|
762,470
|
|
|
757,439
|
|
||
Retained earnings
|
|
64,797
|
|
|
32,851
|
|
||
Treasury stock, at cost (4,120,475 at December 31, 2018 and 2,802,019 at December 31, 2017)
|
|
(93,055
|
)
|
|
(47,105
|
)
|
||
Accumulated other comprehensive loss
|
|
(50,228
|
)
|
|
(36,298
|
)
|
||
Total shareholders’ equity
|
|
731,291
|
|
|
754,140
|
|
||
Total liabilities and shareholders’ equity
|
|
$
|
893,361
|
|
|
$
|
914,669
|
|
|
|
Years Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Income
|
|
|
||||||||||
Dividends from subsidiary
|
|
$
|
90,000
|
|
|
$
|
27,000
|
|
|
$
|
30,000
|
|
Interest income
|
|
78
|
|
|
60
|
|
|
51
|
|
|||
Total income
|
|
90,078
|
|
|
27,060
|
|
|
30,051
|
|
|||
Expense
|
|
|
|
|
|
|
||||||
Interest expense
|
|
8,269
|
|
|
7,646
|
|
|
3,334
|
|
|||
Other
|
|
3,662
|
|
|
5,869
|
|
|
3,227
|
|
|||
Total expense
|
|
11,931
|
|
|
13,515
|
|
|
6,561
|
|
|||
Income before income tax expense
|
|
78,147
|
|
|
13,545
|
|
|
23,490
|
|
|||
Income tax benefit
|
|
2,489
|
|
|
4,242
|
|
|
2,278
|
|
|||
Income before equity in undistributed earnings of subsidiaries
|
|
80,636
|
|
|
17,787
|
|
|
25,768
|
|
|||
Equity in undistributed earnings of subsidiaries
|
|
(6,498
|
)
|
|
36,525
|
|
|
23,581
|
|
|||
Net income
|
|
$
|
74,138
|
|
|
$
|
54,312
|
|
|
$
|
49,349
|
|
|
|
Years Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
||||||||||
OPERATING ACTIVITIES:
|
|
|
|
|
|
|
||||||
Net Income
|
|
$
|
74,138
|
|
|
$
|
54,312
|
|
|
$
|
49,349
|
|
Adjustments to reconcile net income to net cash provided by operations:
|
|
|
|
|
|
|
||||||
Amortization
|
|
164
|
|
|
153
|
|
|
45
|
|
|||
Equity in undistributed earnings of subsidiaries
|
|
6,498
|
|
|
(36,525
|
)
|
|
(23,581
|
)
|
|||
Decrease (increase) in other assets
|
|
6,060
|
|
|
(2,113
|
)
|
|
(1,035
|
)
|
|||
Increase (decrease) in other liabilities
|
|
1,377
|
|
|
(155
|
)
|
|
1,564
|
|
|||
Net cash provided by operating activities
|
|
88,237
|
|
|
15,672
|
|
|
26,342
|
|
|||
INVESTING ACTIVITIES:
|
|
|
|
|
|
|
||||||
Investment in subsidiaries
|
|
—
|
|
|
890
|
|
|
(126,000
|
)
|
|||
Net cash paid in acquisition
|
|
—
|
|
|
(22,801
|
)
|
|
—
|
|
|||
Net cash used in investing activities
|
|
—
|
|
|
(21,911
|
)
|
|
(126,000
|
)
|
|||
FINANCING ACTIVITIES:
|
|
|
|
|
|
|
||||||
Net proceeds from issuance of subordinated long-term debt
|
|
—
|
|
|
—
|
|
|
98,060
|
|
|||
Purchase of common stock
|
|
(47,193
|
)
|
|
—
|
|
|
(10,199
|
)
|
|||
Proceeds from issuance of common stock
|
|
3,883
|
|
|
3,953
|
|
|
78,962
|
|
|||
Cash dividends paid
|
|
(41,979
|
)
|
|
(32,199
|
)
|
|
(25,963
|
)
|
|||
Net cash (used in) provided by financing activities
|
|
(85,289
|
)
|
|
(28,246
|
)
|
|
140,860
|
|
|||
|
|
|
|
|
|
|
||||||
Net increase (decrease) in cash and cash equivalents
|
|
2,948
|
|
|
(34,485
|
)
|
|
41,202
|
|
|||
Cash and cash equivalents at beginning of period
|
|
8,483
|
|
|
42,968
|
|
|
1,766
|
|
|||
Cash and cash equivalents at end of period
|
|
$
|
11,431
|
|
|
$
|
8,483
|
|
|
$
|
42,968
|
|
20.
|
QUARTERLY FINANCIAL INFORMATION OF REGISTRANT
|
|
|
2018
|
||||||||||||||
|
|
Fourth
Quarter |
|
Third
Quarter |
|
Second
Quarter |
|
First
Quarter |
||||||||
|
|
|
|
|
|
|
|
|
||||||||
Interest income
|
|
$
|
58,022
|
|
|
$
|
57,152
|
|
|
$
|
56,797
|
|
|
$
|
57,194
|
|
Interest expense
|
|
15,612
|
|
|
14,742
|
|
|
13,686
|
|
|
13,061
|
|
||||
Net interest income
|
|
42,410
|
|
|
42,410
|
|
|
43,111
|
|
|
44,133
|
|
||||
Provision for loan losses
|
|
2,446
|
|
|
975
|
|
|
1,281
|
|
|
3,735
|
|
||||
Net gain (loss) on sale of securities available for sale
|
|
61
|
|
|
(741
|
)
|
|
(332
|
)
|
|
(827
|
)
|
||||
Noninterest income excluding net gain (loss) on sale of securities
|
|
10,073
|
|
|
10,763
|
|
|
11,339
|
|
|
10,437
|
|
||||
Noninterest expense
|
|
30,196
|
|
|
28,962
|
|
|
29,274
|
|
|
31,667
|
|
||||
Income before income tax expense
|
|
19,902
|
|
|
22,495
|
|
|
23,563
|
|
|
18,341
|
|
||||
Income tax expense
|
|
2,521
|
|
|
2,192
|
|
|
3,360
|
|
|
2,090
|
|
||||
Net income
|
|
17,381
|
|
|
20,303
|
|
|
20,203
|
|
|
16,251
|
|
||||
Earnings per common share
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic
|
|
$
|
0.50
|
|
|
$
|
0.58
|
|
|
$
|
0.58
|
|
|
$
|
0.46
|
|
Diluted
|
|
$
|
0.50
|
|
|
$
|
0.58
|
|
|
$
|
0.57
|
|
|
$
|
0.46
|
|
Cash dividends paid per common share
|
|
$
|
0.32
|
|
|
$
|
0.30
|
|
|
$
|
0.30
|
|
|
$
|
0.28
|
|
|
|
2017
|
||||||||||||||
|
|
Fourth
Quarter |
|
Third
Quarter |
|
Second
Quarter |
|
First
Quarter |
||||||||
|
|
|
|
|
|
|
|
|
||||||||
Interest income
|
|
$
|
50,104
|
|
|
$
|
46,473
|
|
|
$
|
46,009
|
|
|
$
|
44,888
|
|
Interest expense
|
|
11,798
|
|
|
11,513
|
|
|
10,585
|
|
|
9,608
|
|
||||
Net interest income
|
|
38,306
|
|
|
34,960
|
|
|
35,424
|
|
|
35,280
|
|
||||
Provision for loan losses
|
|
1,271
|
|
|
960
|
|
|
1,346
|
|
|
1,098
|
|
||||
Net (loss) gain on sale of securities available for sale
|
|
(249
|
)
|
|
627
|
|
|
(75
|
)
|
|
322
|
|
||||
Noninterest income excluding net gain (loss) on sale of securities
|
|
9,348
|
|
|
8,781
|
|
|
9,368
|
|
|
9,351
|
|
||||
Noninterest expense
|
|
29,933
|
|
|
25,007
|
|
|
25,537
|
|
|
25,858
|
|
||||
Income before income tax expense
|
|
16,201
|
|
|
18,401
|
|
|
17,834
|
|
|
17,997
|
|
||||
Income tax expense
|
|
5,870
|
|
|
3,890
|
|
|
3,353
|
|
|
3,008
|
|
||||
Net income
|
|
10,331
|
|
|
14,511
|
|
|
14,481
|
|
|
14,989
|
|
||||
Earnings per common share
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Basic
|
|
$
|
0.33
|
|
|
$
|
0.49
|
|
|
$
|
0.49
|
|
|
$
|
0.51
|
|
Diluted
|
|
$
|
0.33
|
|
|
$
|
0.49
|
|
|
$
|
0.49
|
|
|
$
|
0.51
|
|
Cash dividends paid per common share
|
|
$
|
0.30
|
|
|
$
|
0.28
|
|
|
$
|
0.28
|
|
|
$
|
0.25
|
|
•
|
pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;
|
•
|
provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and
|
•
|
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.
|
|
|
|
|
|
|
Incorporated by Reference
|
||||||
Exhibit Number
|
|
Exhibit Description
|
|
Filed Herewith
|
|
Exhibit
|
|
Form
|
|
Filing Date
|
|
File No.
|
(2)
|
|
Plan of acquisition, reorganization, arrangement, liquidation or succession
|
|
|
|
|
|
|
|
|
|
|
2.1
|
|
Agreement and Plan of Merger
, dated April 28, 2014, by and among Southside Bancshares, Inc., Omega Merger Sub, Inc. and OmniAmerican Bancorp, Inc.
|
|
|
|
2
|
|
10-Q
|
|
05/09/2014
|
|
0-12247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2.2
|
|
Agreement and Plan of Merger,
dated June 12, 2017, by and among Southside Bancshares, Inc., Rocket Merger Sub, Inc. and Diboll State Bancshares, Inc.
|
|
|
|
2.1
|
|
10-Q
|
|
07/28/2017
|
|
0-12247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3)
|
|
Articles of Incorporation and Bylaws
|
|
|
|
|
|
|
|
|
|
|
3.1
|
|
|
|
|
3.1
|
|
8-K
|
|
05/14/2018
|
|
0-12247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3.2
|
|
|
|
|
3.1
|
|
8-K
|
|
02/22/2018
|
|
0-12247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4)
|
|
Instruments defining the rights of security holders, including indentures
|
|
|
|
|
|
|
|
|
|
|
4.1
|
|
Subordinated Indenture
, dated as of September 19, 2016, by and between the Company and Wilmington Trust, National Association, as Trustee.
|
|
|
|
4.1
|
|
8-K
|
|
9/19/2016
|
|
0-12247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4.2
|
|
First Supplemental Indenture
, dated as of September 19, 2016 by and between the Company and Wilmington Trust, National Association, as Trustee, including the form of the Notes attached as Exhibit A thereto.
|
|
|
|
4.2
|
|
8-K
|
|
09/19/2016
|
|
0-12247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4.3
|
|
Management agrees to furnish to the Securities and Exchange Commission, upon request, a copy of any other agreements or instruments of Southside Bancshares, Inc. and its subsidiaries defining the rights of holders of any long-term debt whose authorization does not exceed 10% of total assets.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(10)
|
|
Material Contracts
|
|
|
|
|
|
|
|
|
|
|
10.1
|
|
Officers Long-term Disability Income Plan effective June 25, 1990 (filed as Exhibit 10(b) to the Registrant’s Form 10-K for the year ended June 30, 1990, and incorporated herein by reference)
|
|
|
|
**10 (b)
|
|
10-K
|
|
1991
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.2
|
|
Retirement Plan Restoration Plan for the subsidiaries of SoBank, Inc. (now named Southside Bancshares, Inc.)
|
|
|
|
**10 (c)
|
|
10-K
|
|
1993
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.3
|
|
Form of Deferred Compensation Agreements
dated June 30, 1994 with each of Sam Dawson, Lee Gibson and Jeryl Story, as amended October 15, 1997
|
|
|
|
**10 (f)
|
|
10-K
|
|
03/30/1998
|
|
0-12247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.4
|
|
Deferred Compensation Agreement
dated December 12, 2008, by and between Southside Bank and Julie Shamburger
|
|
|
|
**10.3
|
|
10-Q
|
|
04/28/2017
|
|
0-12247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.5
|
|
Deferred Compensation Agreement
dated December 12, 2008, by and between Southside Bank and Tim Alexander
|
|
|
|
**10.2
|
|
10-Q
|
|
04/28/2017
|
|
0-12247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.6
|
|
Deferred Compensation Agreement
dated January 14, 2009, by and between Southside Bank and Bill Clawater
|
|
|
|
**10.6
|
|
10-K
|
|
02/28/2018
|
|
0-12247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.7
|
|
Deferred Compensation Agreement
dated January 12, 2009, by and between Southside Bank and Brian McCabe
|
|
|
|
**10.7
|
|
10-K
|
|
02/28/2018
|
|
0-12247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.8
|
|
Split dollar compensation plan
dated September 7, 2004 with Lee R. Gibson, III
|
|
|
|
**10 (i)
|
|
8-K
|
|
10/19/2004
|
|
3-17203
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.9
|
|
Split dollar compensation plan
dated August 31, 2004 with Charles E. Dawson
|
|
|
|
**10 (k)
|
|
8-K
|
|
10/19/2004
|
|
3-17203
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.10
|
|
Employment Agreement
dated October 22, 2007, by and between Southside Bank and Lee R. Gibson
|
|
|
|
**10 (l)
|
|
8-K
|
|
10/26/2007
|
|
3-17203
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.11
|
|
Employment Agreement
dated June 4, 2008, by and between Southside Bank and Julie Shamburger
|
|
|
|
**10.1
|
|
10-Q
|
|
04/28/2017
|
|
0-12247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.12
|
|
Employment Agreemen
t dated October 22, 2007, by and between Southside Bank and Sam Dawson
|
|
|
|
**10 (m)
|
|
8-K
|
|
10/26/2007
|
|
3-17203
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.13
|
|
Employment Agreement
dated April 28, 2014, by and between Southside Bank, Southside Bancshares, Inc., and Tim Carter
|
|
|
|
**10.2
|
|
S-4
|
|
7/18/2014
|
|
3-196817
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.14
|
|
Employment Agreement
dated November 17, 2008, by and between Southside Bank and Brian McCabe
|
|
|
|
**10.14
|
|
10-K
|
|
02/28/2018
|
|
0-12247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.15
|
|
Amended and Restated Employment Agreement
dated September 13, 2017, by and between Southside Bank, Southside Bancshares, Inc., and Tim Carter
|
|
|
|
**10.1
|
|
10-Q
|
|
10/27/2017
|
|
0-12247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.16
|
|
First Amendment to Employment Agreement
dated as of October 25, 2018, by and between Southside Bank and Julie Shamburger
|
|
|
|
**10.1
|
|
10-Q
|
|
10/26/2018
|
|
0-12247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.17
|
|
Key Employee Retention Agreement,
dated as of June 12, 2017 by and between Southside Bank and Hilliard J. Shands, III
|
|
|
|
**10.1
|
|
8-K
|
|
12/1/2017
|
|
0-12247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.18
|
|
|
|
|
**99.1
|
|
8-K
|
|
4/20/2009
|
|
3-17203
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.19
|
|
Form of Southside Bancshares, Inc. Nonstatutory Stock Option Award Certificate
for purchase of Options pursuant to the Southside Bancshares, Inc. 2009 Incentive Plan
|
|
|
|
**10.1
|
|
10-Q
|
|
8/8/2011
|
|
3-17203
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.20
|
|
Form of Southside Bancshares, Inc. Restricted Stock Unit Award Certificate
for grant of Units pursuant to the Southside Bancshares, Inc. 2009 Incentive Plan
|
|
|
|
**10.2
|
|
10-Q
|
|
8/8/2011
|
|
3-17203
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.21
|
|
|
|
|
**10.1
|
|
8-K
|
|
05/12/2017
|
|
0-12247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.22
|
|
Form of Southside Bancshares, Inc. Restricted Stock Unit Award Certificate
for grant of Units pursuant to the Southside Bancshares, Inc. 2017 Incentive Plan
|
|
|
|
**10.2
|
|
10-Q
|
|
10/27/2017
|
|
0-12247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.23
|
|
Form of Southside Bancshares, Inc. Nonstatutory Stock Option Award Certificate
for purchase of Options pursuant to the Southside Bancshares, Inc. 2017 Incentive Plan
|
|
|
|
**10.3
|
|
10-Q
|
|
10/27/2017
|
|
0-12247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(21)
|
|
Subsidiaries of the registrant
|
|
|
|
|
|
|
|
|
|
|
21
|
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(23)
|
|
Consents of experts and counsel
|
|
|
|
|
|
|
|
|
|
|
23.1
|
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(31)
|
|
Rule 13a-14(a)/15d-14(a) Certifications
|
|
|
|
|
|
|
|
|
|
|
31.1
|
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
31.2
|
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(32)
|
|
Section 1350 Certification
|
|
|
|
|
|
|
|
|
|
|
32
|
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(101)
|
|
Interactive Date File
|
|
|
|
|
|
|
|
|
|
|
101.INS
|
|
XBRL Instance Document.
|
|
X
|
|
|
|
|
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document.
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document.
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
**Compensation plan, benefit plan or employment contract or arrangement.
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
SOUTHSIDE BANCSHARES, INC.
|
|
|
|
|
|
|
|
|
|
DATE:
|
February 28, 2019
|
BY:
|
/s/ Lee R. Gibson
|
|
|
|
Lee R. Gibson, CPA
|
|
|
|
President and Chief Executive Officer
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DATE:
|
February 28, 2019
|
BY:
|
/s/ Julie N. Shamburger
|
|
|
|
Julie N. Shamburger, CPA
|
|
|
|
Senior Executive Vice President and Chief Financial Officer
|
|
|
|
(Principal Financial and Accounting Officer)
|
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
|
/s/
|
John R. (Bob) Garrett
|
|
Chairman of the Board
|
|
February 28, 2019
|
|
John R. (Bob) Garrett
|
|
and Director
|
|
|
|
|
|
|
|
|
/s/
|
Donald W. Thedford
|
|
Vice Chairman of the Board
|
|
February 28, 2019
|
|
Donald W. Thedford
|
|
and Director
|
|
|
|
|
|
|
|
|
/s/
|
Lee R. Gibson
|
|
President, Chief Executive Officer
|
|
February 28, 2019
|
|
Lee R. Gibson
|
|
and Director
|
|
|
|
|
|
|
|
|
/s/
|
Lawrence Anderson
|
|
Director
|
|
February 28, 2019
|
|
Lawrence Anderson
|
|
|
|
|
|
|
|
|
|
|
/s/
|
S. Elaine Anderson
|
|
Director
|
|
February 28, 2019
|
|
S. Elaine Anderson
|
|
|
|
|
|
|
|
|
|
|
/s/
|
Michael J. Bosworth
|
|
Director
|
|
February 28, 2019
|
|
Michael J. Bosworth
|
|
|
|
|
|
|
|
|
|
|
/s/
|
Herbert C. Buie
|
|
Director
|
|
February 28, 2019
|
|
Herbert C. Buie
|
|
|
|
|
|
|
|
|
|
|
/s/
|
Alton Cade, Jr.
|
|
Director
|
|
February 28, 2019
|
|
Alton Cade, Jr.
|
|
|
|
|
|
|
|
|
|
|
/s/
|
Patricia A. Callan
|
|
Director
|
|
February 28, 2019
|
|
Patricia A. Callan
|
|
|
|
|
|
|
|
|
|
|
/s/
|
George H. (Trey) Henderson, III
|
|
Director
|
|
February 28, 2019
|
|
George H. (Trey) Henderson, III
|
|
|
|
|
|
|
|
|
|
|
/s/
|
Melvin B. Lovelady
|
|
Director
|
|
February 28, 2019
|
|
Melvin B. Lovelady
|
|
|
|
|
|
|
|
|
|
|
/s/
|
Tony K. Morgan
|
|
Director
|
|
February 28, 2019
|
|
Tony K. Morgan
|
|
|
|
|
|
|
|
|
|
|
/s/
|
John F. Sammons, Jr.
|
|
Director
|
|
February 28, 2019
|
|
John F. Sammons, Jr.
|
|
|
|
|
|
|
|
|
|
|
/s/
|
H. J. Shands, III
|
|
Director
|
|
February 28, 2019
|
|
H. J. Shands, III
|
|
|
|
|
|
|
|
|
|
|
/s/
|
William Sheehy
|
|
Director
|
|
February 28, 2019
|
|
William Sheehy
|
|
|
|
|
|
|
|
|
|
|
/s/
|
Preston L. Smith
|
|
Director
|
|
February 28, 2019
|
|
Preston L. Smith
|
|
|
|
|
|
|
|
|
|
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/s/
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M. Richard Warner
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Director
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February 28, 2019
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M. Richard Warner
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