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EMPLOYEE BENEFIT PLANS (Tables) | 12 Months Ended
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Dec. 31, 2021
EMPLOYEE BENEFIT PLANS [Abstract] |
Obligation and Net Funded Status | The following table sets forth the obligation and funded status of the Plans as of December 31 (in thousands):
|  | 2021 |  |  | 2020 |
Change in benefit obligation |  |  |  |  |  |
Benefit obligation at beginning of year |  | $ | 14,020 |  |  | $ | 13,027 |
Service cost |  |  | 380 |  |  |  | 330 |
Interest cost |  |  | 270 |  |  |  | 332 |
Actuarial (Gain) / Loss |  |  | (438 | ) |  |  | 1,810 |
Settlement gain |  |  | (17 | ) |  |  | (34 | )
Benefits paid |  |  | (1,092 | ) |  |  | (1,445 | )
Benefit obligation at end of year |  |  | 13,123 |  |  |  | 14,020 |
Change in plan assets |  |  |  |  |  |  |  |
Fair value of plan assets at beginning of year |  |  | 13,247 |  |  |  | 13,277 |
Actual return (loss) on plan assets |  |  | 1,761 |  |  |  | 1,415 |
Employer contribution |  |  | - |  |  |  | - |
Benefits paid |  |  | (1,092 | ) |  |  | (1,445 | )
Fair value of plan assets at end of year |  |  | 13,916 |  |  |  | 13,247 |
Funded status |  | $ | 793 |  |  | $ | (773 | )
Components of Net Periodic Pension Cost not yet recognized | Amounts not yet recognized as a component of net periodic pension cost as of December 31 (in thousands):
Amounts recognized in accumulated other comprehensive loss consists of: |  | 2021 |  |  | 2020 |
Net loss |  | $ | 2,491 |  |  | $ | 4,383 |
Prior service cost |  |  | - |  |  |  | - |
Total |  | $ | 2,491 |  |  | $ | 4,383 |
Components of Net Periodic Benefit Costs | The components of net periodic benefit costs for the years ended December 31 are as follows (in thousands):
|  | 2021 |  |  | 2020 |  |  | 2019 |  | Affected line item on the Consolidated Statement of Income
Service cost |  | $ | 380 |  |  | $ | 330 |  |  | $ | 289 |  | Salary and Employee Benefits
Interest cost |  |  | 270 |  |  |  | 332 |  |  |  | 588 |  | Other Expenses
Return on plan assets |  |  | (895 | ) |  |  | (862 | ) |  |  | (924 | ) | Other Expenses
Settlement loss (gain) |  |  | 235 |  |  |  | 302 |  |  |  | (259 | ) | Other Expenses
Net amortization and deferral |  |  | 336 |  |  |  | 233 |  |  |  | 272 |  | Other Expenses
Net periodic benefit cost |  | $ | 326 |  |  | $ | 335 |  |  | $ | (34 | ) |
Weighted-average Assumptions used to Determine Benefit Obligations and Net Periodic Benefit Cost (Income) | The weighted-average assumptions used to determine benefit obligations at December 31, 2021 and 2020 is summarized in the following table. The change in the discount rate is the primary driver of the actuarial gain that occurred in 2021 of $438,000.
|  | 2021 |  |  | 2020 |
Discount rate FCCB Plan |  |  | 2.25 | % |  |  | 2.00 | %
Rate of compensation increase |  |  | 3.00 | % |  |  | 3.00 | %
The weighted-average assumptions used to determine net periodic benefit cost (income) for the year ended December 31. Due to the decision to terminate the pension plan acquired as part of the FNB acquisition, the discount rate for the plans will be separated for 2019.
|  | 2021 |  |  | 2020 |  |  | 2019 |
Discount rate FCCB Plan |  |  | 2.00 | % |  |  | 2.75 | % |  |  | 4.00 | %
Discount rate FNB Plan |  | NA |  |  |  | NA |  |  |  | 3.49 | %
Expected long-term return on plan assets FCCB plan |  |  | 7.00 | % |  |  | 7.00 | % |  |  | 7.00 | %
Rate of compensation increase |  |  | 3.00 | % |  |  | 3.00 | % |  |  | 3.00 | %
Fair Value of Plan Assets | The long-term rate of return on plan assets gives consideration to returns currently being earned on plan assets as well as future rates expected to be earned. The investment objective is to maximize total return consistent with the interests of the participants and beneficiaries, and prudent investment management. The allocation of the pension plan assets is determined on the basis of sound economic principles and is continually reviewed in light of changes in market conditions. Asset allocation favors equity securities, with a target allocation of 50-70%. The target allocation for debt securities is 30-50%. At December 31, 2021, the pension plan had a sufficient cash and money market position in order to re-allocate the equity portfolio for diversification purposes and reduce risk in the total portfolio. The following table sets forth by level, within the fair value hierarchy as defined in footnote 19, the Plan’s assets at fair value as of December 31, 2021 and 2020 (dollars in thousands):
2021 |  | Level I |  |  | Level II |  |  | Level III |  |  | Total |  |  | Allocation |
Assets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents |  | $ | 188 |  |  | $ | - |  |  | $ | - |  |  | $ | 188 |  |  |  | 1.4 | %
Equity Securities |  |  | 6,291 |  |  |  | - |  |  |  | - |  |  |  | 6,291 |  |  |  | 45.2 | %
Mutual Funds and ETF’s |  |  | 5,246 |  |  |  | - |  |  |  | - |  |  |  | 5,246 |  |  |  | 37.7 | %
Corporate Bonds |  |  | - |  |  |  | 2,191 |  |  |  | - |  |  |  | 2,191 |  |  |  | 15.7 | %
Total |  | $ | 11,725 |  |  | $ | 2,191 |  |  | $ | - |  |  | $ | 13,916 |  |  |  | 100.0 | %
2020 |  | Level I |  |  | Level II |  |  | Level III |  |  | Total |  |  | Allocation |
Assets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents |  | $ | 456 |  |  | $ | - |  |  | $ | - |  |  | $ | 456 |  |  |  | 3.4 | %
Equity Securities |  |  | 5,709 |  |  |  | - |  |  |  | - |  |  |  | 5,709 |  |  |  | 43.1 | %
Mutual Funds and ETF’s |  |  | 4,410 |  |  |  | - |  |  |  | - |  |  |  | 4,410 |  |  |  | 33.3 | %
Corporate Bonds |  |  | - |  |  |  | 2,672 |  |  |  | - |  |  |  | 2,672 |  |  |  | 20.2 | %
Total |  | $ | 10,575 |  |  | $ | 2,672 |  |  | $ | - |  |  | $ | 13,247 |  |  |  | 100.0 | %
Expected Future Benefit Payments | The Bank does not expect to make a contribution to its pension plan in 2022. Expected future benefit payments that the Bank estimates from its pension plan are as follows (in thousands):
2022 |  | $ | 420 |
2023 |  |  | 634 |
2024 |  |  | 806 |
2025 |  |  | 1,161 |
2026 |  |  | 2,130 |
2027 - 2031 |  |  | 3,944 |
Vesting, Awarding and Forfeiting of Restricted Shares | The Company maintains a Restricted Stock Plan (the Plan) whereby employees and non-employee corporate directors are eligible to receive awards of restricted stock based upon performance related requirements. Awards granted under the Plan are in the form of the Company’s common stock and maybe subject to certain vesting requirements including in the case of employees, continuous employment or service with the Company. In April 2016, the Company’s stockholder authorized a total of 150,000 shares of the Company’s common stock to be made available under the Plan. As of December 31, 2021, 119,391 shares remain available to be issued under the Plan. The Plan assists the Company in attracting, retaining and motivating employees to make substantial contributions to the success of the Company and to increase the emphasis on the use of equity as a key component of compensation. The following table details the vesting, awarding and forfeiting of unearned restricted shares during 2021:
|  | 2021 |
|  | Shares |  |  | Weighted Average Market Price |
Outstanding, beginning of year |  |  | 10,202 |  |  | $ | 55.93 |
Granted |  |  | 4,660 |  |  |  | 60.73 |
Forfeited |  |  | (70 | ) |  |  | 55.03 |
Vested |  |  | (7,838 | ) |  |  | 56.51 |
Outstanding, end of year |  |  | 6,954 |  |  | $ | 58.51 |

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