XML 73 R11.htm IDEA: XBRL DOCUMENT
v3.19.3

Acquisition | 9 Months Ended
--- | ---
Sep. 30, 2019
Business Combinations [Abstract] |
Acquisition | ACQUISITION MBT Financial Corp. On September 1, 2019, the Corporation acquired 100 percent of MBT. MBT, a Michigan corporation, merged with and into the Corporation, whereupon the separate corporate existence of MBT ceased and the Corporation survived. Immediately following the merger, MBT's wholly-owned subsidiary, Monroe Bank & Trust, merged with and into the Bank, with the Bank continuing as the surviving bank. MBT was headquartered in Monroe, Michigan and had 20 banking centers serving the Monroe market. Pursuant to the merger agreement, each MBT shareholder received 0.275 shares of the Corporation's common stock for each outstanding share of MBT common stock held. The Corporation issued approximately 6.4 million shares of common stock, which was valued at approximately $229.9 million. The Corporation engaged in this transaction with the expectation that it would be accretive to income and add a new market area in Michigan that has a demographic profile consistent with many of the current Indiana and Ohio markets served by the Bank. Goodwill resulted from this transaction due to the expected synergies and economies of scale. Under the acquisition method of accounting, the total purchase price is allocated to net tangible and intangible assets based on their current estimated fair values on the date of the acquisition. Based on preliminary valuations of the fair value of tangible and intangible assets acquired and liabilities assumed, which are based on assumptions that are subject to change based on the timing of the transaction, the purchase price for the MBT acquisition is detailed in the following table. If, prior to the end of the one-year measurement period for finalizing the purchase price allocation, information becomes available about facts and circumstances that existed as of the acquisition date, which would indicate adjustments are required to the purchase price allocation, such adjustments will be included in the purchase price allocation retrospectively.
|  | Fair Value
Cash and cash equivalents |  | $ | 10,222 |
Interest-bearing time deposits |  | 281,228 |
Investment securities |  | 212,235 |
Loans |  | 731,260 |
Premises and equipment |  | 21,664 |
Federal Home Loan Bank stock |  | 4,148 |
Interest receivable |  | 3,361 |
Cash surrender value of life insurance |  | 59,545 |
Tax asset, deferred and receivable |  | 4,970 |
Other assets |  | 7,737 |
Deposits |  | (1,105,926 | )
Securities sold under repurchase agreements |  | (94,760 | )
Federal Home Loan Bank advances |  | (10,853 | )
Other liabilities |  | (9,261 | )
Net tangible assets acquired |  | 115,570 |
Core deposit intangible |  | 16,527 |
Goodwill |  | 97,844 |
Purchase price |  | $ | 229,941 |
Of the total purchase price, $16,527,000 was allocated to a core deposit intangible, which will be amortized over its estimated life of 10 years. The remaining purchase price was allocated to goodwill, which is not deductible for tax purposes. Acquired loan data for MBT is included in the following table:
| Fair Value of Acquired Loans at Acquisition Date |  | Gross Contractual Amounts Receivable at Acquisition Date |  | Best Estimate at Acquisition Date of Contractual Cash Flows Not Expected to be Collected
Acquired receivables subject to ASC 310-30 | $ | 3,531 |  |  | $ | 6,840 |  |  | $ | 2,733 |
Acquired receivables not subject to ASC 310-30 | $ | 727,729 |  |  | $ | 907,210 |  |  | $ | 14,506 |
Purchased loans with evidence of credit deterioration since origination and for which it is probable at the date of acquisition that the acquirer will not collect all contractually required principal and interest payments are accounted for under ASC 310-30, Loans Acquired with Deteriorated Credit Quality. The difference between contractually required payments and the cash flows expected to be collected at acquisition is referred to as the nonaccretable difference. The accretable portion of the fair value discount or premium is the difference between the expected cash flows and the net present value of expected cash flows, with such difference accreted into earnings over the term of the loans. Pro Forma Financial Information The results of operations of MBT have been included in the Corporation's consolidated financial statements since the acquisition date. The following schedules includes pro forma results for the three months and nine months ended September 30, 2019 and the annual period ended December 31, 2018, as if the MBT acquisition occurred as of the beginning of the periods presented.
|  | Three Months Ended September 30, 2019 |  | Nine Months Ended September 30, 2019
Total revenue (net interest income plus other income) |  | $ | 120,606 |  |  | $ | 351,121 |
Net income available to common shareholders |  | $ | 30,835 |  |  | $ | 110,958 |
Earnings per share: |  |  |  |
Basic |  | $ | 0.55 |  |  | $ | 1.98 |
Diluted |  | $ | 0.54 |  |  | $ | 1.97 |
|  |  |  | Year Ended December 31, 2018
Total revenue (net interest income plus other income) |  |  |  | $ | 474,842 |
Net income available to common shareholders |  |  |  | $ | 174,900 |
Earnings per share: |  |  |  |
Basic |  |  |  | $ | 3.13 |
Diluted |  |  |  | $ | 3.12 |
The pro forma information includes adjustments for interest income on loans and investments, interest expense on deposits and borrowings, premises expense for banking centers acquired and amortization of intangibles arising from the transaction and the related income tax effects. The pro forma information for the three months ended September 30, 2019 includes operating revenue from MBT of $4.9 million since the date of acquisition. Additionally $17.3 million, net of tax, of non-recurring expenses directly attributable to the MBT acquisition were included in the three months ended September 30, 2019 pro forma information. The pro forma information for the nine months ended September 30, 2019, includes operating revenue from MBT $4.9 million since the date of acquisition. Additionally $18.2 million, net of tax, of non-recurring expenses directly attributable to the MBT acquisition were included in the nine months ended September 30, 2019 pro forma information. The pro forma information for the year ended December 31, 2018 includes operating results from MBT as if the acquisition occurred at the beginning of the year. Additionally, $877,000, net of tax, of non-recurring expenses directly attributable to the MBT acquisition were included in the year ended December 31, 2018 pro forma information. The pro forma information is presented for informational purposes only and is not indicative of the results of operations that actually would have been achieved had the acquisition been consummated as of that time, or intended to be a projection of future results.

X
- References No definition available. + Details
Name: | us-gaap_BusinessCombinationsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for business combinations, including leverage buyout transactions (as applicable), and divestitures. This may include a description of a business combination or divestiture (or series of individually immaterial business combinations or divestitures) completed during the period, including background, timing, and assets and liabilities recognized and reclassified or sold. This element does not include fixed asset sales and plant closings. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=2122178 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
Name: | us-gaap_MergersAcquisitionsAndDispositionsDisclosuresTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration