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SHAREHOLDERS' EQUITY AND EARNINGS PER COMMON SHARE | 12 Months Ended
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Dec. 31, 2016
Stockholders' Equity Note [Abstract] |
SHAREHOLDERS' EQUITY AND EARNINGS PER COMMON SHARE | SHAREHOLDERS’ EQUITY AND EARNINGS PER COMMON SHARE Minimum Regulatory Capital Requirements The Company and Bank are subject to various regulatory capital requirements administered by the federal and state banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if imposed, could have a direct material impact on the Company’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and Bank must meet specific capital guidelines that involve quantitative measures of its assets, liabilities and certain off-balance-sheet items as calculated under regulatory accounting practices. The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weighting and other factors. Quantitative measures established by regulation to ensure capital adequacy require the Company and Bank to maintain minimum amounts and ratios (set forth in the following table) of total and Tier 1 capital (as defined in the regulations) to risk-weighted assets (as defined) and of Tier 1 capital to average assets (as defined). As of year-end 2016 and 2015, the Bank and the Company met the capital adequacy requirements. Regulators may set higher expected capital requirements in some cases based on their examinations. Effective January 1, 2015, the Company and the Bank became subject to the Basel III rule that requires the Company and the Bank to assess their Common equity tier 1 capital to risk weighted assets and the Company and the Bank each exceed the minimum to be well capitalized. In addition, the final capital rules added a requirement to maintain a minimum conservation buffer, composed of Common equity tier 1 capital, of 2.5% of risk-weighted assets, to be phased in over three years and applied to the Common equity tier 1 risk-based capital ratio, the Tier 1 risk-based capital ratio and the Total risk-based capital ratio. Accordingly, banking organizations, on a fully phased in basis no later than January 1, 2019, must maintain a minimum Common equity tier 1 risk-based capital ratio of 7.0%, a minimum Tier 1 risk-based capital ratio of 8.5% and a minimum Total risk-based capital ratio of 10.5%. The required minimum conservation buffer began to be phased in incrementally, starting at 0.625% on January 1, 2016 and will increase to 1.25% on January 1, 2017, 1.875% on January 1, 2018 and 2.5% on January 1, 2019. The final capital rules impose restrictions on capital distributions and certain discretionary cash bonus payments if the minimum capital conservation buffer is not met. At December 31, 2016, the capital levels of both the Company and the Bank exceeded all regulatory capital requirements and their regulatory capital ratios were above the minimum levels required to be considered well capitalized for regulatory purposes. The capital levels of both the Company and the Bank at December 31, 2016 also exceeded the minimum capital requirements including the currently applicable capital conservation buffer of 0.625%. As of year-end 2016 and 2015, the Bank and the Company met the conditions to be classified as “well capitalized” under the relevant regulatory framework. To be categorized as well capitalized, an institution must maintain minimum total risk-based, Tier 1 risk-based, and Tier 1 leverage ratios as set forth in the following tables. The Company and Bank’s actual and required capital amounts were as follows:
|  |  |  |  |  | Minimum Capital Requirement |  | Minimum to be Well Capitalized Under Prompt Corrective Action Provisions
|  | Actual |  |
(Dollars in thousands) |  | Amount |  | Ratio |  | Amount |  | Ratio |  | Amount |  | Ratio
December 31, 2016 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Company (Consolidated) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total capital to risk-weighted assets |  | $ | 803,618 |  |  | 11.87 | % |  | $ | 541,603 |  |  | 8.00 | % |  | $ | 677,004 |  |  | 10.00 | %
Common Equity Tier 1 Capital to risk weighted assets |  | 670,120 |  |  | 9.90 |  |  | 304,652 |  |  | 4.50 |  |  | 440,053 |  |  | 6.50 |
Tier 1 capital to risk-weighted assets |  | 681,500 |  |  | 10.07 |  |  | 406,202 |  |  | 6.00 |  |  | 541,603 |  |  | 8.00 |
Tier 1 capital to average assets |  | 681,500 |  |  | 7.88 |  |  | 270,802 |  |  | 4.00 |  |  | 338,502 |  |  | 5.00 |
Bank |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total capital to risk-weighted assets |  | $ | 756,792 |  |  | 11.21 | % |  | $ | 539,893 |  |  | 8.00 | % |  | $ | 674,866 |  |  | 10.00 | %
Common Equity Tier 1 Capital to risk weighted assets |  | 672,244 |  |  | 9.96 |  |  | 303,690 |  |  | 4.50 |  |  | 438,663 |  |  | 6.50 |
Tier 1 capital to risk-weighted assets |  | 672,244 |  |  | 9.96 |  |  | 404,920 |  |  | 6.00 |  |  | 539,893 |  |  | 8.00 |
Tier 1 capital to average assets |  | 672,244 |  |  | 7.84 |  |  | 269,920 |  |  | 4.00 |  |  | 337,433 |  |  | 5.00 |
December 31, 2015 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Company (Consolidated) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total capital to risk-weighted assets |  | $ | 686,489 |  |  | 11.91 | % |  | $ | 461,231 |  |  | 8.00 | % |  | $ | 576,539 |  |  | 10.00 | %
Common Equity Tier 1 Capital to risk weighted assets |  | 564,878 |  |  | 9.80 |  |  | 259,443 |  |  | 4.50 |  |  | 374,750 |  |  | 6.50 |
Tier 1 capital to risk-weighted assets |  | 573,033 |  |  | 9.94 |  |  | 345,924 |  |  | 6.00 |  |  | 461,231 |  |  | 8.00 |
Tier 1 capital to average assets |  | 573,033 |  |  | 7.71 |  |  | 297,420 |  |  | 4.00 |  |  | 371,775 |  |  | 5.00 |
Bank |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total capital to risk-weighted assets |  | $ | 642,866 |  |  | 11.16 | % |  | $ | 460,882 |  |  | 8.00 | % |  | $ | 576,103 |  |  | 10.00 | %
Common Equity Tier 1 Capital to risk weighted assets |  | 569,131 |  |  | 9.88 |  |  | 259,246 |  |  | 4.50 |  |  | 374,467 |  |  | 6.50 |
Tier 1 capital to risk-weighted assets |  | 569,131 |  |  | 9.88 |  |  | 345,662 |  |  | 6.00 |  |  | 460,882 |  |  | 8.00 |
Tier 1 capital to average assets |  | 569,131 |  |  | 7.66 |  |  | 297,313 |  |  | 4.00 |  |  | 371,641 |  |  | 5.00 |
Common stock The Bank is subject to dividend restrictions imposed by various regulators, including a limitation on the total of all dividends that the Bank may pay to the Company in any calendar year. The total of all dividends shall not exceed the Bank’s net income for the current year (as defined by statute), plus the Bank’s net income retained for the two previous years, without regulatory approval. Dividends from the Bank are an important source of funds to the Company to make dividend payments on its common and preferred stock, to make payments on its borrowings, and for its other cash needs. The ability of the Company and the Bank to pay dividends is dependent on regulatory policies and regulatory capital requirements. The ability to pay such dividends in the future may be adversely affected by new legislation or regulations, or by changes in regulatory policies relating to capital, safety and soundness, and other regulatory concerns. The payment of dividends by the Company is subject to Delaware law, which generally limits dividends to an amount equal to an excess of the net assets of a company (the amount by which total assets exceed total liabilities) over statutory capital, or if there is no excess, to the Company’s net profits for the current and/or immediately preceding fiscal year. Accumulated other comprehensive income Year-end components of accumulated other comprehensive income/(loss) are as follows:
(In thousands) |  | 2016 |  | 2015
Other accumulated comprehensive income/(loss), before tax: |  |  |  |  |  |
Net unrealized holding gain on AFS securities |  | $ | 25,176 |  |  | $ | 6,316 |
Net (loss) on effective cash flow hedging derivatives |  | (6,573 | ) |  | (8,532 | )
Net unrealized holding (loss) on pension plans |  | (2,954 | ) |  | (3,469 | )
Income taxes related to items of accumulated other comprehensive income/(loss): |  |  |  |  |  |
Net unrealized holding (gain) on AFS securities |  | (9,636 | ) |  | (2,437 | )
Net loss on effective cash flow hedging derivatives |  | 2,589 |  |  | 3,424 |
Net unrealized holding loss on pension plans |  | 1,164 |  |  | 1,392 |
Accumulated other comprehensive income/(loss) |  | $ | 9,766 |  |  | $ | (3,305 | )
The following table presents the components of other comprehensive income (loss) for the years ended December 31, 2016, 2015, and 2014:
(In thousands) |  | Before Tax |  | Tax Effect |  | Net of Tax
Year Ended December 31, 2016 |  |  |  |  |  |  |  |  |
Net unrealized holding gain on AFS securities: |  |  |  |  |  |  |  |  |
Net unrealized gain arising during the period |  | $ | 18,309 |  |  | $ | (6,979 | ) |  | $ | 11,330 |
Less: reclassification adjustment for (losses) realized in net income |  | (551 | ) |  | 220 |  |  | (331 | )
Net unrealized holding gain on AFS securities |  | 18,860 |  |  | (7,199 | ) |  | 11,661 |
Net loss on cash flow hedging derivatives: |  |  |  |  |  |  |  |  |
Net unrealized (loss) arising during the period |  | (2,023 | ) |  | 754 |  |  | (1,269 | )
Less: reclassification adjustment for (losses) realized in net income |  | (3,981 | ) |  | 1,589 |  |  | (2,392 | )
Net gain on cash flow hedging derivatives |  | 1,958 |  |  | (835 | ) |  | 1,123 |
Net unrealized holding gain on pension plans |  |  |  |  |  |  |  |  |
Net unrealized gain arising during the period |  | 351 |  |  | (155 | ) |  | 196 |
Less: reclassification adjustment for losses realized in net income |  | 164 |  |  | (73 | ) |  | 91 |
Net unrealized holding gain on pension plans |  | 515 |  |  | (228 | ) |  | 287 |
Other Comprehensive Income |  | $ | 21,333 |  |  | $ | (8,262 | ) |  | $ | 13,071 |
(In thousands) |  | Before Tax |  | Tax Effect |  | Net of Tax
Year Ended December 31, 2015 |  |  |  |  |  |  |  |  |
Net unrealized holding (loss) on AFS securities: |  |  |  |  |  |  |  |  |
Net unrealized (loss) arising during the period |  | $ | (7,567 | ) |  | $ | 2,793 |  |  | $ | (4,774 | )
Less: reclassification adjustment for gains realized in net income |  | 2,110 |  |  | (847 | ) |  | 1,263 |
Net unrealized holding (loss) on AFS securities |  | (9,677 | ) |  | 3,640 |  |  | (6,037 | )
Net (loss) on cash flow hedging derivatives: |  |  |  |  |  |  |  |  |
Net unrealized (loss) arising during the period |  | (5,232 | ) |  | 2,094 |  |  | (3,138 | )
Less: reclassification adjustment for (losses) realized in net income |  | — |  |  | — |  |  | — |
Net (loss) on cash flow hedging derivatives |  | (5,232 | ) |  | 2,094 |  |  | (3,138 | )
Net unrealized holding (loss) on pension plans |  |  |  |  |  |  |  |  |
Net unrealized (loss) arising during the period |  | (1,436 | ) |  | 572 |  |  | (864 | )
Less: reclassification adjustment for (losses) gains realized in net income |  | (259 | ) |  | 104 |  |  | (155 | )
Net unrealized holding (loss) on pension plans |  | (1,177 | ) |  | 468 |  |  | (709 | )
Other Comprehensive Loss |  | $ | (16,086 | ) |  | $ | 6,202 |  |  | $ | (9,884 | )
(In thousands) |  | Before Tax |  | Tax Effect |  | Net of Tax
Year Ended December 31, 2014 |  |  |  |  |  |  |  |  |
Net unrealized holding gain on AFS securities: |  |  |  |  |  |  |  |  |
Net unrealized gain arising during the period |  | $ | 25,769 |  |  | $ | (9,791 | ) |  | $ | 15,978 |
Less: reclassification adjustment for gains realized in net income |  | 482 |  |  | (196 | ) |  | 286 |
Net unrealized holding gain on AFS securities |  | 25,287 |  |  | (9,595 | ) |  | 15,692 |
Net (loss) on cash flow hedging derivatives: |  |  |  |  |  |  |  |  |
Net unrealized (loss) arising during the period |  | (6,403 | ) |  | 2,608 |  |  | (3,795 | )
Less: reclassification adjustment for (losses) realized in net income |  | (5,393 | ) |  | 2,201 |  |  | (3,192 | )
Net (loss) on cash flow hedging derivatives |  | (1,010 | ) |  | 407 |  |  | (603 | )
Net loss on terminated swap: |  |  |  |  |  |  |  |  |
Net unrealized (loss) arising during the period |  | — |  |  | — |  |  | — |
Less: reclassification adjustment for (losses) realized in net income |  | (3,237 | ) |  | 1,312 |  |  | (1,925 | )
Net loss on terminated swap |  | 3,237 |  |  | (1,312 | ) |  | 1,925 |
Net unrealized holding (loss) on pension plans |  |  |  |  |  |  |  |  |
Net unrealized (loss) arising during the period |  | (2,308 | ) |  | 930 |  |  | (1,378 | )
Less: reclassification adjustment for gains (losses) realized in net income |  | — |  |  | — |  |  | — |
Net unrealized holding (loss) on pension plans |  | (2,308 | ) |  | 930 |  |  | (1,378 | )
Other Comprehensive Income |  | $ | 25,206 |  |  | $ | (9,570 | ) |  | $ | 15,636 |
The following table presents the changes in each component of accumulated other comprehensive income (loss), for the years ended December 31, 2016, 2015, and 2014:
(in thousands) |  | Net unrealized holding gain (loss) on AFS Securities |  | Net loss on effective cash flow hedging derivatives |  | Net loss on terminated swap |  | Net unrealized holding gain (loss) on pension plans |  | Total
Year Ended December 31, 2016 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Balance at Beginning of Year |  | $ | 3,880 |  |  | $ | (5,108 | ) |  | $ | — |  |  | $ | (2,077 | ) |  | $ | (3,305 | )
Other Comprehensive Gain (Loss) before reclassifications |  | 11,330 |  |  | (1,269 | ) |  | — |  |  | 196 |  |  | 10,257 |
Amounts Reclassified from Accumulated other comprehensive income |  | (331 | ) |  | (2,392 | ) |  | — |  |  | (91 | ) |  | (2,814 | )
Total Other Comprehensive Income |  | 11,661 |  |  | 1,123 |  |  | — |  |  | 287 |  |  | 13,071 |
Balance at End of Period |  | $ | 15,541 |  |  | $ | (3,985 | ) |  | $ | — |  |  | $ | (1,790 | ) |  | $ | 9,766 |
Year Ended December 31, 2015 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Balance at Beginning of Year |  | $ | 9,916 |  |  | $ | (1,969 | ) |  | $ | — |  |  | $ | (1,368 | ) |  | $ | 6,579 |
Other Comprehensive (Loss) before reclassifications |  | (4,774 | ) |  | (3,138 | ) |  | — |  |  | (864 | ) |  | (8,776 | )
Amounts Reclassified from Accumulated other comprehensive income |  | 1,263 |  |  | — |  |  | — |  |  | (155 | ) |  | 1,108 |
Total Other Comprehensive Loss |  | (6,037 | ) |  | (3,138 | ) |  | — |  |  | (709 | ) |  | (9,884 | )
Balance at End of Period |  | $ | 3,880 |  |  | $ | (5,108 | ) |  | $ | — |  |  | $ | (2,077 | ) |  | $ | (3,305 | )
Year Ended December 31, 2014 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Balance at Beginning of Year |  | $ | (5,776 | ) |  | $ | (1,366 | ) |  | $ | (1,925 | ) |  | $ | 10 |  |  | $ | (9,057 | )
Other Comprehensive Gain (Loss) Before reclassifications |  | 15,978 |  |  | (3,795 | ) |  | — |  |  | (1,378 | ) |  | 10,805 |
Amounts Reclassified from Accumulated other comprehensive income |  | 286 |  |  | (3,192 | ) |  | (1,925 | ) |  | — |  |  | (4,831 | )
Total Other Comprehensive Income |  | 15,692 |  |  | (603 | ) |  | 1,925 |  |  | (1,378 | ) |  | 15,636 |
Balance at End of Period |  | $ | 9,916 |  |  | $ | (1,969 | ) |  | $ | — |  |  | $ | (1,368 | ) |  | $ | 6,579 |
The following table presents the amounts reclassified out of each component of accumulated other comprehensive income (loss) for the years ended December 31, 2016, 2015, and 2014:
|  |  |  |  |  |  |  | Affected Line Item in the Statement Where Net Income Is Presented
|  | Years Ended December 31, |
(in thousands) |  | 2016 |  | 2015 |  | 2014 |
Realized (losses) gains on AFS securities:
|  | $ | (551 | ) |  | $ | 2,110 |  |  | $ | 482 |  |  | Non-interest income
|  | 220 |  |  | (847 | ) |  | (196 | ) |  | Tax expense
|  | (331 | ) |  | 1,263 |  |  | 286 |  |  |
Realized (losses) on cash flow hedging derivatives:
|  | (3,981 | ) |  | — |  |  | (5,393 | ) |  | Interest income
|  | 1,589 |  |  | — |  |  | 2,201 |  |  | Tax expense
|  | (2,392 | ) |  | — |  |  | (3,192 | ) |  |
Amortization of realized (losses) on terminated swap:
|  | — |  |  | — |  |  | (3,237 | ) |  | Interest income
|  | — |  |  | — |  |  | 1,312 |  |  | Tax expense
|  | — |  |  | — |  |  | (1,925 | ) |  |
Realized (losses) on pension plans |  |  |  |  |  |  |  |
|  | 164 |  |  | (259 | ) |  | — |  |  | Non-interest expense
|  | (73 | ) |  | 104 |  |  | — |  |  | Tax expense
|  | 91 |  |  | (155 | ) |  | — |  |  |
Total reclassifications for the period |  | $ | (2,632 | ) |  | $ | 1,108 |  |  | $ | (4,831 | ) |  |
Earnings Per Common Share Basic earnings per common share (“EPS”) excludes dilution and is computed by dividing net income applicable to common stock by the weighted average number of common shares outstanding for the year. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock (such as stock options) were exercised or converted into additional common shares that would then share in the earnings of the entity. Diluted EPS is computed by dividing net income applicable to common stock by the weighted average number of common shares outstanding for the year, plus an incremental number of common-equivalent shares computed using the treasury stock method. Earnings per common share has been computed based on the following (average diluted shares outstanding is calculated using the treasury stock method):
|  | Years Ended December 31,
(In thousands, except per share data) |  | 2016 |  | 2015 |  | 2014
Net income |  | $ | 58,670 |  |  | $ | 49,518 |  |  | $ | 33,744 |
Average number of common shares issued |  | 32,604 |  |  | 30,074 |  |  | 26,525 |
Less: average number of treasury shares |  | 1,116 |  |  | 1,215 |  |  | 1,386 |
Less: average number of unvested stock award shares |  | 500 |  |  | 466 |  |  | 409 |
Average number of basic common shares outstanding |  | 30,988 |  |  | 28,393 |  |  | 24,730 |
Plus: dilutive effect of unvested stock award shares |  | 122 |  |  | 106 |  |  | 67 |
Plus: dilutive effect of stock options outstanding |  | 57 |  |  | 65 |  |  | 57 |
Average number of diluted common shares outstanding |  | 31,167 |  |  | 28,564 |  |  | 24,854 |
Basic earning per share |  | $ | 1.89 |  |  | $ | 1.74 |  |  | $ | 1.36 |
Diluted earnings per share |  | $ | 1.88 |  |  | $ | 1.73 |  |  | $ | 1.36 |
For the year ended 2016, 52 thousand options were anti-dilutive and therefore excluded from the earnings per share calculations. For the year ended 2015, 200 thousand options were anti-dilutive and therefore excluded from the earnings per share calculations. For the year ended 2014, 225 thousand options were anti-dilutive and therefore excluded from the earnings per share calculations.

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