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Acquisition Business Acquisitions | 9 Months Ended
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Sep. 30, 2019
Business Combinations [Abstract] |
Business Combination Disclosure [Text Block] | Acquisition Santander Branch Acquisition On September 6, 2019, the Company's banking subsidiary, First Commonwealth Bank, completed its acquisition of 14 full service branches from Santander Bank N.A. ("Santander") receiving $329.5 million in cash. This acquisition further expands the Company's market into State College, Lock Haven, Williamsport and Lewisburg, Pennsylvania and included the purchase of 101.2 million in loans and $471.4 million in deposits. The table below summarizes the net assets acquired (at fair value) and consideration transferred in connection with the Santander acquisition (dollars in thousands):
Consideration received |  |  |
Cash received | $ | 329,530 |  |  |
Total consideration received |  |  | $ | 329,530 |
Fair Value of Assets Acquired |  |  |
Cash and cash equivalents | 2,935 |  |  |
Loans | 100,025 |  |  |
Premises and other equipment | 3,637 |  |  |
Core deposit intangible | 5,277 |  |  |
Other assets | 736 |  |  |
Total assets acquired | 112,610 |  |  |
Fair Value of Liabilities Assumed |  |  |
Deposits | 471,383 |  |  |
Other Liabilities | 187 |  |  |
Total liabilities assumed | 471,570 |  |  |
Total Fair Value of Identifiable Net Assets |  |  | (358,960 | )
Goodwill |  |  | $ | 29,430 |
The Company determined that this acquisition constitutes a business combination as defined in FASB ASC Topic 805, “Business Combinations.” Accordingly, as of the date of the acquisition, the Company recorded the assets acquired and liabilities assumed at fair value. The Company determined fair values in accordance with the guidance provided in FASB ASC Topic 820, “Fair Value Measurements and Disclosures.” Acquired loans were recorded at fair value with no carryover of the related allowance for loan losses. At the date of acquisition, none of the loans were accounted for under the guidance of ASC Topic 310-30, “Receivables-Loans and Debt Securities Acquired with Deteriorated Credit Quality.” The fair value of acquired loans and certificate of deposits is established by discounting the expected future cash flows with a market discount rate for like maturities and risk instruments. The $100.0 million fair value of acquired loans is the result of $101.2 million in loans acquired from Santander and the recognition of a net combined yield and credit mark adjustment of $1.2 million. The $471.4 million fair value of acquired deposits is the result of $471.0 million in deposits acquired and the recognition of a yield mark adjustment of $0.4 million on the certificate of deposits. A $5.3 million core deposit intangible was recognized for core deposits acquired. The fair value of the acquired loans, customer deposit intangible, other assets and assumed deposits may change during the provisional period, which may last up to twelve months subsequent to the acquisition date as we are in the process of finalizing our valuations. The Company may obtain additional information to refine the valuation of the aforementioned items and adjust the recorded fair value, although such adjustments are not expected to be significant. Adjustments recorded to the acquired assets and liabilities will be applied prospectively in accordance with ASU No. 2015-16, “Business Combinations.” The goodwill of $29.4 million arising from the acquisition consists largely of the synergies and economies of scale expected from combining the operations of the Company with the branches acquired from Santander. The goodwill for this transaction is expected to be deducted over a 15 year period for income tax purposes. Costs related to the acquisition totaled $3.7 million. These amounts were expensed as incurred and are recorded as a merger and acquisition related expense in the Consolidated Statements of Income. Garfield Acquisition Corporation On May 1, 2018, the Company completed its acquisition of Garfield Acquisition Corporation ("Garfield") and its banking subsidiary, Foundation Bank, for consideration of $17.4 million in cash and 2.7 million shares of the Company's common stock. Through the acquisition, the Company obtained five full-service banking offices which are operating under the First Commonwealth name. This acquisition expands the Company's presence into the Cincinnati, Ohio market and added $184.5 million in loans and $141.3 million in deposits to the Company's balance sheet. The table below summarizes the final purchase price allocation and the net assets acquired (at fair value) and consideration transferred in connection with the Garfield acquisition (dollars in thousands):
Consideration Paid |  |  |
Cash paid to shareholders | $ | 17,400 |  |  |
Shares issued to shareholders (2,745,098 shares) | 41,561 |  |  |
Total consideration paid |  |  | $ | 58,961 |
Fair Value of Assets Acquired |  |  |
Cash and cash equivalents | 18,105 |  |  |
FHLB Stock | 3,261 |  |  |
Loans | 184,506 |  |  |
Premises and other equipment | 409 |  |  |
Intangible assets | 1,248 |  |  |
Other assets | 1,747 |  |  |
Total assets acquired | 209,276 |  |  |
Fair Value of Liabilities Assumed |  |  |
Deposits | 141,281 |  |  |
FHLB borrowings | 22,988 |  |  |
Other liabilities | 5,068 |  |  |
Total liabilities assumed | 169,337 |  |  |
Total Fair Value of Identifiable Net Assets |  |  | 39,939 |
Goodwill |  |  | $ | 19,022 |
The goodwill of $19.0 million arising from the acquisition represents the value of synergies and economies of scale expected from combining the operations of the Company with Garfield Acquisition Corporation. The Company determined that this acquisition constitutes a business combination as defined in FASB ASC Topic 805, “Business Combinations.” Accordingly, as of the date of the acquisition, the Company recorded the assets acquired and liabilities assumed at fair value. The Company determined fair values in accordance with the guidance provided in FASB ASC Topic 820, “Fair Value Measurements and Disclosures.” Acquired loans were recorded at fair value with no carryover of the related allowance for loan losses. Fair value is established by discounting the expected future cash flows with a market discount rate for like maturities and risk instruments. At the date of acquisition, none of the loans were accounted for under the guidance of ASC Topic 310-30, “Receivables-Loans and Debt Securities Acquired with Deteriorated Credit Quality.” The $184.5 million fair value of acquired loans is the result of $183.7 million in net loans acquired from Garfield, the recognition of a net combined yield and credit mark adjustment of $4.3 million and the $5.1 million reversal of Garfield's allowance as well as prior fair value marks recorded by Garfield. The fair value of the 2,745,098 common shares issued was determined based on the market price of the Company's common shares on the acquisition date. Costs related to the acquisition totaled $1.6 million. These amounts were expensed as incurred and are recorded as a merger and acquisition related expense in the Consolidated Statements of Income. As a result of the full integration of the operations of Garfield, it is not practicable to determine revenue or net income included in the Company's operating results relating to Garfield since the date of acquisition as Garfield’s results cannot be separately identified.

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: 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
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