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Summary of Significant Accounting Policies (Tables) | 12 Months Ended
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Dec. 31, 2020
Accounting Policies [Abstract] |
Schedule of ASC 326 Adoption | The following tables show the impact to our financial statement line items due to adoption of ASC 326 as of and during the quarter ended December 31, 2020.
(in thousands) | Pre-Tax Increase (Decrease) Upon the Adoption of CECL | Deferred Tax Effect | After Tax Impact of Adoption of CECL
Impact to allowance for credit losses on loans: |  |  |
Allowance for credit losses on loans | $ | 748 |  |  |
Retained earnings (cumulative transition adjustment) | $ | (1,604) |  | $ | 474 |  | $ | (1,130) |
Net income (reversal of provision for credit losses on loans) | $ | 856 |  | $ | (253) |  | $ | 603 |
Impact to allowance for credit losses on unfunded loan commitments: |  |  |
Allowance for credit losses on unfunded commitments | $ | 1,082 |  |  |
Retained earnings (cumulative transition adjustment) | $ | (122) |  | $ | 36 |  | $ | (86) |
Net income (provision for credit losses on unfunded commitments) | $ | (960) |  | $ | 284 |  | $ | (676) |
The following table shows the impact on the allowance for credit losses due to the transition from the incurred loss method to the CECL method by loan class.
(in thousands) | Pre-Adoption Balance at September 30, 2020 | Cumulative Transition Adjustment 1 | Post Adoption Adjusted Balance at October 1, 2020
Allowance for credits losses on loans: |  |  |
Commercial and industrial | $ | 2,525 |  | $ | (278) |  | $ | 2,247 |
Real estate: |  |  |
Commercial owner-occupied | 3,135 |  | 138 |  | 3,273 |
Commercial investor-owned | 11,624 |  | 1,755 |  | 13,379 |
Construction | 860 |  | 201 |  | 1,061 |
Home equity | 1,038 |  | (361) |  | 677 |
Other residential | 1,260 |  | (212) |  | 1,048 |
Installment and other consumer loans | 406 |  | (125) |  | 281 |
Unallocated | 1,265 |  | 486 |  | 1,751 |
Total | $ | 22,113 |  | $ | 1,604 |  | $ | 23,717 |
Allowance for credit losses on unfunded commitments | $ | 1,697 |  | $ | 122 |  | $ | 1,819 |
1 The cumulative transition adjustment resulted from applying the CECL method, which was based on economic forecasts and other assumptions as of December 31, 2019. Refer to Note 3, Loans and Allowance for Credit Losses, for more information.
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | At December 31, 2020, the future estimated amortization expense for the CDI arising from our past acquisitions is as follows:
(in thousands) | 2021 | 2022 | 2023 | 2024 | 2025 | Thereafter | Total
Core deposit intangible amortization | $ | 818 |  | $ | 782 |  | $ | 719 |  | $ | 422 |  | $ | 400 |  | $ | 690 |  | $ | 3,831 |
Schedule of Earnings Per Share Reconciliation | The following table shows: 1) weighted average basic shares, 2) potentially dilutive weighted average common shares related to stock options and unvested restricted stock awards, and 3) weighted average diluted shares. Basic EPS are calculated by dividing net income by the weighted average number of common shares outstanding during each annual period, excluding unvested restricted stock awards. Diluted EPS are calculated using the weighted average number of potentially dilutive common shares. The number of potentially dilutive common shares included in year-to-date diluted EPS is a year-to-date weighted average of potentially dilutive common shares included in each quarterly diluted EPS computation. In computing diluted EPS, we exclude anti-dilutive shares such as options whose exercise prices exceed the current common stock price, as they would not reduce EPS under the treasury method. We have two forms of outstanding common stock: common stock and unvested restricted stock awards. Holders of unvested restricted stock awards receive non-forfeitable dividends at the same rate as common shareholders and they both share equally in undistributed earnings. Under the two-class method, the difference in EPS is nominal for these participating securities.
(in thousands, except per share data)1 | 2020 | 2019 | 2018
Weighted average basic common shares outstanding | 13,525 |  | 13,620 |  | 13,864 |
Potentially dilutive common shares related to: |  |  |
Stock options | 69 |  | 148 |  | 136 |
Unvested restricted stock awards | 23 |  | 26 |  | 29 |
Weighted average diluted common shares outstanding | 13,617 |  | 13,794 |  | 14,029 |
Net income | $ | 30,242 |  | $ | 34,241 |  | $ | 32,622 |
Basic EPS | $ | 2.24 |  | $ | 2.51 |  | $ | 2.35 |
Diluted EPS | $ | 2.22 |  | $ | 2.48 |  | $ | 2.33 |
Weighted average anti-dilutive common shares not included in the calculation of diluted EPS | 148 |  | 35 |  | 44 |
1 Share and per share data have been adjusted to reflect the two-for-one stock split effective November 27, 2018.

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