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Employee Benefit Plans | 12 Months Ended
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Dec. 31, 2023
Retirement Benefits [Abstract] |
Employee Benefit Plans | Employee Benefit Plans 401(k) Plan The Company sponsors a retirement savings plan pursuant to Section 401(k) of the Internal Revenue Code ("IRC"). New employees who have met the age requirement are automatically enrolled in the plan at a 6% deferral rate. The automatic deferral can be modified by the employee at any time. An eligible employee may contribute up to 15% of annual salary to the plan, not to exceed IRC limits. For each of the years ended December 31, 2023, 2022, and 2021, the Company matched 100% of the employee’s contribution up to 6%. The Company’s matching contribution expense was $6.1 million, $4.9 million, and $4.3 million for the years ended December 31, 2023, 2022, and 2021, respectively. Although discretionary contributions by the Company are permitted by the plan, the Company did not make any such contributions in the years presented. The Company’s matching and discretionary contributions are made according to the same investment elections each participant has established for their deferral contributions. Pension Plan Historically, the Company offered a noncontributory defined benefit retirement plan (the “Pension Plan”) that qualified under Section 401(a) of the IRC. The Pension Plan provided for a monthly payment, at normal retirement age of 65, equal to one-twelfth of the sum of (i) 0.75% of Final Average Annual Compensation (five highest consecutive calendar years’ earnings out of the last ten years of employment) multiplied by the employee’s years of service not in excess of 40 years, and (ii) 0.65% of Final Average Annual Compensation in excess of the average social security wage base multiplied by years of service not in excess of 35 years. Benefits were fully vested after five years of service. Effective December 31, 2012, the Company froze the Pension Plan for all participants and has not made any contributions to the Pension Plan in any year presented. In March 2023, the Company’s Board of Directors (the "Board") approved a resolution to terminate the Pension Plan. During the second quarter of 2023, the Company commenced the Pension Plan termination process and on July 31, 2023, the Pension Plan was amended to terminate it as of that date. During the fourth quarter of 2023, the Pension Plan settled benefits through lump-sum payments of approximately $9.2 million to eligible participants electing that option and purchased annuity contracts from One America (the "Insurer") which irrevocably transferred to the Insurer approximately $19.5 million of the Pension Plan's obligations and related assets, thereby reducing the Pension Plan's obligations at December 31, 2023 to zero. The Insurer will administer all future payments to remaining participants of the Pension Plan. The Pension Plan's net funded position was sufficient to cover the lump sum payments and the purchase of the annuity contract, settling all benefit obligations with no additional funding required. As a result of this transaction, the Company recognized a one-time, non-cash pension settlement charge of $1.0 million. After the settlement of the benefit obligations and payment of expenses, the Company had excess assets in the Pension Plan of approximately $2.5 million. The Company has elected to utilize the remaining surplus after payment of final administrative expenses for future contributions under the Company’s 401(k) plan. The assets will be held in the Pension Plan trust account until the contributions are made and are included in "Other assets" on the consolidated balance sheets. Prior to the termination of the Pension Plan, the investment objective was to ensure that there were sufficient assets to fund regular pension benefits payable to employees over the long-term life of the plan. Plan assets were allocated in a manner to closely duration-match the actuarial projected cash flows of the plan liabilities. In 2018, the Pension Plan adopted a liability-driven investment strategy to help meet the objectives. This strategy employed a structured fixed-income portfolio designed to reduce volatility in the Pension Plan’s future funding requirements and funding status. This was accomplished by using a blend of high quality corporate and government fixed-income securities, with both intermediate and long-term durations. The following table reconciles the beginning and ending balances of the Pension Plan’s benefit obligation, as computed by the Company with assistance from its independent actuarial consultants, and its plan assets, with the difference between the two amounts representing the funded status of the Pension Plan as of the end of the respective year.
($ in thousands) |  | 2023 |  | 2022 |  | 2021
Change in benefit obligation |  |  |  |  |  |
Benefit obligation at beginning of year |  | $ | 30,611 |  |  | 41,657 |  |  | 44,750 |
Service cost |  | — |  |  | — |  |  | — |
Interest cost |  | 1,451 |  |  | 1,043 |  |  | 981 |
Actuarial gain |  | (1,470) |  |  | (10,286) |  |  | (2,041) |
Benefits paid, including lump sums |  | (11,135) |  |  | (1,803) |  |  | (2,033) |
Transfer to insurer |  | (19,457) |  |  | — |  |  | — |
Accumulated benefit obligation at end of year |  | — |  |  | 30,611 |  |  | 41,657 |
Change in plan assets |  |  |  |  |  |
Plan assets at beginning of year |  | 33,655 |  |  | 44,904 |  |  | 48,167 |
Actual return on plan assets |  | (547) |  |  | (9,446) |  |  | (1,230) |
Employer contributions |  | — |  |  | — |  |  | — |
Benefits paid, including lump sums |  | (11,135) |  |  | (1,803) |  |  | (2,033) |
Transfer to insurer |  | (19,457) |  |  | — |  |  | — |
Plan assets at end of year |  | 2,517 |  |  | 33,655 |  |  | 44,904 |
Funded status at end of year (1) |  | $ | 2,517 |  |  | 3,044 |  |  | 3,247 |
(1) - As of December 31, 2023, the Pension Plan was terminated and surplus assets were held in the Pension Plan's trust account until deployed as contributions to the Company's 401(k) Plan in 2024 and 2025.
The following table presents information regarding the amounts recognized in accumulated other comprehensive income (loss) (“AOCI”) at December 31, 2023 and 2022, as it relates to the Pension Plan.
($ in thousands) |  | 2023 |  | 2022
Net actuarial loss |  | $ | — |  |  | (1,497) |
Prior service cost |  | — |  |  | — |
Amount recognized in AOCI before tax effect |  | — |  |  | (1,497) |
Tax benefit |  | — |  |  | 344 |
Net amount recognized as decrease to AOCI |  | $ | — |  |  | (1,153) |
The following table reconciles the beginning and ending balances of AOCI at December 31, 2023 and 2022, as it relates to the Pension Plan:
($ in thousands) |  | 2023 |  | 2022
Accumulated other comprehensive loss at beginning of fiscal year |  | $ | (1,153) |  |  | (1,110) |
Net loss arising during period |  | (693) |  |  | (312) |
Recognition of net actuarial loss due to plan settlement |  | 998 |  |  | — |
Amortization of net unrecognized actuarial loss |  | 1,192 |  |  | 256 |
Tax (benefit) expense of changes during the year, net |  | (344) |  |  | 13 |
Accumulated other comprehensive loss at end of fiscal year |  | $ | — |  |  | (1,153) |
The following table reconciles the beginning and ending balances of the prepaid pension cost related to the Pension Plan for the periods presented. As noted above, there are no remaining obligations of the Pension Plan and assets at December 31, 2023 represent the surplus cash held in the Pension Plan's trust account for contributions to be made to the Company's 401(k) plan during 2024 and 2025.
($ in thousands) |  | 2023 |  | 2022
Prepaid pension cost as of beginning of fiscal year |  | $ | 4,542 |  |  | 4,689 |
Net periodic pension cost for fiscal year |  | (2,025) |  |  | (147) |
Actual employer contributions |  | — |  |  | — |
Prepaid pension asset as of end of fiscal year |  | $ | 2,517 |  |  | 4,542 |
Net pension cost for the Pension Plan included the following components for the years ended December 31, 2023, 2022, and 2021:
($ in thousands) |  | 2023 |  | 2022 |  | 2021
Service cost – benefits earned during the period |  | $ | — |  |  | — |  |  | — |
Interest cost on projected benefit obligation |  | 1,451 |  |  | 1,043 |  |  | 981 |
Expected return on plan assets |  | (1,616) |  |  | (1,152) |  |  | (1,059) |
Net amortization and deferral |  | 1,192 |  |  | 256 |  |  | 577 |
Recognized settlement loss |  | 998 |  |  | — |  |  | — |
Net periodic pension cost |  | $ | 2,025 |  |  | 147 |  |  | 499 |
The components of net periodic benefit cost other than the service cost component are included in the line item "Other operating expenses" in the consolidated statements of income. The following assumptions were used in determining the actuarial information for the Pension Plan for the years ended December 31, 2023, 2022, and 2021:
|  | 2023 |  | 2022 |  | 2021
Discount rate used to determine net periodic pension cost |  | 4.94% |  | 2.62% |  | 2.24%
Expected long-term rate of return on assets |  | 4.94% |  | 2.62% |  | 2.24%
Discount rate used to calculate end of year liability disclosures (1) |  | n/a |  | 4.94% |  | 2.62%
(1) - As of December 31, 2023, there were no Pension Plan obligations or liabilities.
The Company’s discount rate policy for the Pension Plan is based on a calculation of the Company’s expected pension payments, with those payments discounted using the FTSE yield curve (formerly called the Citigroup Pension Index yield curve) that matches the specific expected cash flows of the Pension Plan. As noted above, the remaining assets in the Pension Plan's trust account at December 31, 2023 represent the surplus cash held for contributions to be made to the Company's 401(k) plan during 2024 and 2025. The cash balance is held in an interest-bearing money market accounts and is considered a Level 1 fair value asset. The Pension Plan assets at December 31, 2022 included $194.0 thousand of cash and cash equivalents which consisted of interest-bearing money market accounts and is considered a Level 1 fair value asset. The Pension Plans' Level 2 assets totaled $33.5 million and consisted of fixed income commingled funds that primarily include investments in U.S. government securities and corporate bonds. The commingled funds are valued at the net asset value ("NAV") for the units in the fund. The NAV, as provided by the Trustee, is used as practical expedient to estimate fair value. The NAV is based on the fair value of the underlying investments held by the fund. Supplemental Executive Retirement Plan Historically, the Company sponsored a Supplemental Executive Retirement Plan (the “SERP”) for the benefit of certain senior management executives of the Company. The purpose of the SERP was to provide additional monthly pension benefits to ensure that each such senior management executive would receive lifetime monthly pension benefits equal to 3% of his or her final average compensation multiplied by his or her years of service (maximum of 20 years) to the Company or its subsidiaries, subject to a maximum of 60% of his or her final average compensation. The amount of a participant’s monthly SERP benefit is reduced by (i) the amount payable under the Company’s Pension Plan (described above), and (ii) 50% of the participant’s primary social security benefit. Final average compensation means the average of the five highest consecutive calendar years of earnings during the last ten years of service prior to termination of employment. The SERP is an unfunded plan. Payments are made from the general assets of the Company. Effective December 31, 2012, the Company froze the SERP to all participants. The following table reconciles the beginning and ending balances of the SERP’s benefit obligation, as computed by the Company’s independent actuarial consultants:
($ in thousands) |  | 2023 |  | 2022 |  | 2021
Change in benefit obligation |  |  |  |  |  |
Benefit obligation at beginning of year |  | $ | 3,521 |  |  | 4,660 |  |  | 5,982 |
Service cost |  | — |  |  | — |  |  | — |
Interest cost |  | 158 |  |  | 112 |  |  | 119 |
Actuarial gain |  | (86) |  |  | (1,006) |  |  | (1,119) |
Benefits paid |  | (241) |  |  | (245) |  |  | (322) |
Accumulated benefit obligation at end of year |  | 3,352 |  |  | 3,521 |  |  | 4,660 |
Plan assets |  | — |  |  | — |  |  | — |
Funded status at end of year |  | $ | (3,352) |  |  | (3,521) |  |  | (4,660) |
The accumulated benefit obligation presented above is included in "Other liabilities" in the consolidated balance sheets at December 31, 2023 and 2022. The following table presents information regarding the amounts recognized in AOCI at December 31, 2023 and 2022, as it relates to the SERP:
($ in thousands) |  | 2023 |  | 2022
Net (loss) gain |  | $ | (100) |  |  | 1,551 |
Prior service cost |  | — |  |  | — |
Amount recognized in AOCI before tax effect |  | (100) |  |  | 1,551 |
Tax benefit (expense) |  | 23 |  |  | (356) |
Net amount recognized as (decrease) increase to AOCI |  | $ | (77) |  |  | 1,195 |
The following table reconciles the beginning and ending balances of AOCI at December 31, 2023 and 2022, as it relates to the SERP:
($ in thousands) |  | 2023 |  | 2022
Accumulated other comprehensive income at beginning of fiscal year |  | $ | 1,195 |  |  | 838 |
Net gain arising during period |  | 86 |  |  | 1,007 |
Prior service cost |  | — |  |  | — |
Amortization of unrecognized actuarial loss |  | (1,737) |  |  | (544) |
Tax benefit (expense) related to changes during the year, net |  | 379 |  |  | (106) |
Accumulated other comprehensive (loss) income at end of fiscal year |  | $ | (77) |  |  | 1,195 |
The following table reconciles the beginning and ending balances of the prepaid pension cost related to the SERP:
($ in thousands) |  | 2023 |  | 2022
Accrued liability as of beginning of fiscal year |  | $ | (5,071) |  |  | (5,748) |
Net periodic pension cost for fiscal year |  | 1,579 |  |  | 432 |
Benefits paid |  | 241 |  |  | 245 |
Accrued liability as of end of fiscal year |  | $ | (3,251) |  |  | (5,071) |
Net pension cost for the SERP included the following components for the years ended December 31, 2023, 2022, and 2021:
($ in thousands) |  | 2023 |  | 2022 |  | 2021
Service cost – benefits earned during the period |  | $ | — |  |  | — |  |  | — |
Interest cost on projected benefit obligation |  | 158 |  |  | 112 |  |  | 119 |
Amortization of net actuarial (loss) gain |  | (1,737) |  |  | (544) |  |  | 15 |
Net periodic pension cost |  | $ | (1,579) |  |  | (432) |  |  | 134 |
The components of net periodic benefit cost other than the service cost component are included in the line item "Other operating expenses" in the consolidated statements of income. The following table is an estimate of the benefits that will be paid in accordance with the SERP for each of the five calendar years ending December 31, 2027 and thereafter:
($ in thousands) |  | Estimated benefit payments
2024 |  | $ | 240 |
2025 |  | 278 |
2026 |  | 280 |
2027 |  | 298 |
2028 |  | 288 |
2029-2033 |  | 1,322 |
The following assumptions were used in determining the actuarial information for the SERP for the years ended December 31, 2023, 2022, and 2021:
|  | 2023 |  | 2022 |  | 2021
Discount rate used to determine net periodic pension cost |  | 4.90 | % |  | 2.48 | % |  | 2.04 | %
Discount rate used to calculate end of year liability disclosures |  | 4.68 | % |  | 4.90 | % |  | 2.48 | %
The Company’s discount rate policy for the SERP is to use the FTSE yield curve that matches the expected cash flows of the SERP.

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