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ACQUISITION (Tables)
 12 Months Ended
Dec. 31, 2019
Business Combinations [Abstract]  
Summary of Consideration Assets Acquired and Liabilities Assumed
The following table provides a summary of the assets acquired and liabilities assumed and the associated fair value adjustments as recorded by the Company at acquisition:
(in thousands)
 
As Acquired
 
Fair Value Adjustments
 
As Recorded by the Company
Consideration Paid:
 
 
 
 
 
 
Company common stock issued to SIFI common shareholders
$
175,804

Fair value of SIFI stock options converted to Berkshire options
 
 
 
 
 
907

Cash in lieu paid to SIFI shareholders
 
 
 
 
 
14

Total consideration paid
 
 
 
 
 
$
176,725

Recognized amounts of identifiable assets acquired and (liabilities) assumed, at fair value:
Cash and short-term investments
 
$
110,774

 
$
—

 
$
110,774

Investment securities
 
144,629

 
(1,261
)
(a)
143,368

Loans held for sale
 
1,005

 
—

 
1,005

Loans, net
 
1,332,127

 
(29,388
)
(b)
1,302,739

Premises and equipment
 
19,039

 
(2,092
)
(c)
16,947

Core deposit intangibles
 
—

 
17,980

(d)
17,980

Deferred tax assets, net
 
6,629

 
11,315

(e)
17,944

Goodwill and other intangibles
 
16,063

 
(16,063
)
(f)
—

Other assets
 
60,648

 
(984
)
 
59,664

Deposits
 
(1,327,115
)
 
(7,733
)
(g)
(1,334,848
)
Borrowings
 
(154,726
)
 
1,717

(h)
(153,009
)
Other liabilities
 
(33,987
)
 
(7,289
)
(i)
(41,276
)
Total identifiable net assets
 
$
175,086

 
$
(33,798
)
 
$
141,288

 
 
 
 
 
 
 
Goodwill
 
 
 
 
 
$
35,437

_____________________________________
Explanation of Certain Fair Value Adjustments:
(a)
The adjustment represents the write down of the book value of securities to their estimated fair value at the date of acquisition.
(b)
The adjustment represents the write-off of $15.6 million in allowance for loan and lease losses and the write down of the book value of loans to their estimated fair value based on interest rates and expected cash flows as of the acquisition date, which includes an estimate of expected loan loss inherent in the portfolio. Loans with evidence of credit deterioration at acquisition are accounted for under ASC 310-30 and had a book value of $55.8 million and had a fair value of $32.1 million, including a $4.2 million fair value adjustment that is accretable in earnings. Non-impaired loans accounted for under ASC 310-20 had a book value of $1.29 billion and have a fair value of $1.27 billion, including a $6.7 million fair value adjustment discount that is amortized over the remaining term of the loans using the effective interest method, or a straight-line method if the loan is a revolving credit facility.
(c)
The adjustment represents a decreased fair value based on the appraised value of Savings Institute's owned branches comprised of $1.1 million for land. This is in addition to a $1.0 million reduction of the book value of furniture, fixtures, and equipment, to their estimated fair value and the immediate expensing of equipment not meeting the thresholds for capitalization in accordance with Company policy. The adjustments will be depreciated over the remaining estimated economic lives of the assets.
(d)
The adjustment represents the value of the core deposit base assumed in the acquisition. The core deposit asset was recorded as an identifiable intangible asset and will be amortized over the estimated useful life of the deposit base (10 years).
(e)
Represents net deferred tax assets resulting from the fair value adjustments related to the acquired assets and liabilities, identifiable intangibles, and other purchase accounting adjustments.
(f)
Represents the write-off of goodwill and intangible assets from a prior SIFI acquisition.
(g)
The adjustment is necessary because the weighted average interest rate of time deposits exceeded the cost of similar funding at the time of acquisition. The amount will be amortized over the estimated useful life of eleven months.
(h)
Adjusts borrowings by a reduction of $0.8 million to their estimated fair value, which is calculated based on current market rates. This is in addition to a $0.9 million reduction to the estimated fair value for the SI Capital Trust II, which is calculated based on the amount an institution would be willing to purchase the instrument at in the open market.
(i)
Adjusts the book value of other liabilities to their estimated fair value at the acquisition date. The adjustment consists of a $6.7 million increase to post-retirement liabilities due to change-in-control provisions, a $0.9 million increase in bank-owned life insurance liabilities, offset by a decrease of $0.4 million to the unfunded commitment reserve.
Schedule of Acquired Loan Portfolio Information about the Savings Institute acquired loan portfolio subject to ASC 310-30 as of May 17, 2019 is as follows (in thousands):
 
 
ASC 310-30 Loans
Gross contractual receivable amounts at acquisition
 
$
55,754

Contractual cash flows not expected to be collected (nonaccretable discount)
 
(19,427
)
Expected cash flows at acquisition
 
36,327

Interest component of expected cash flows (accretable discount)
 
(4,200
)
Fair value of acquired loans
 
$
32,127
Pro Forma Financial Information
Information in the following table is shown in thousands:
 
 
Pro Forma (unaudited) Years Ended December 31,
 
 
2019
 
2018
Net interest income
 
$
383,828

 
$
412,164

Non-interest income
 
88,500

 
85,563

Income available to common shareholders
 
118,552

 
127,693