XML 43 R30.htm IDEA: XBRL DOCUMENT v3.10.0.1
Subsequent Event - Business Combination Subsequent Event - Business Combination
12 Months Ended
Sep. 30, 2018
Subsequent Events [Abstract]  
Subsequent Event - Business Combination
Subsequent Event - Business Combination

On October 1, 2018, the Company completed the acquisition of South Sound Bank, a Washington-state chartered bank, headquartered in Olympia, Washington ("South Sound Merger"). The Company acquired 100% of the outstanding common stock of South Sound Bank, and South Sound Bank was merged into the Bank and the Company. Pursuant to the terms of the merger agreement, South Sound Bank shareholders received 0.746 of a share of the Company's common stock and $5.68825 in cash per share of South Sound Bank common stock. The Company issued 904,826 shares of its common stock (valued at $28,267,000 based on the Company's closing stock price on September 30, 2018 of $31.24 per share) and paid $6,903,000 in cash in the transaction for total consideration paid of $35,170,000. At September 30, 2018, South Sound Bank had total assets of $178,333,000, a loan portfolio of $121,347,000, and deposits of $151,427,000 with two branches in Thurston County. The primary reason for the acquisition was to expand the Company's presence along Washington State's economically important I-5 corridor.

The South Sound Merger constitutes a business acquisition as defined by GAAP, which establishes principles and requirements for how the acquirer of a business recognizes and measures in its financial statements the identifiable assets acquired and the liabilities assumed.  Accordingly, the estimated fair values of the acquired assets, including the identifiable intangible assets, and the assumed liabilities in the acquisition will be measured and recorded as of the acquisition date.

Costs incurred by the Company for the South Sound Merger totaled $616,000 during the year ended September 30, 2018 and are included in professional fees in the accompanying consolidated statement of income. The operating results of the Company for the year ended September 30, 2018 do not include the operating results produced by the acquired assets and assumed liabilities from South Sound Bank as the South Sound Merger did not close until October 1, 2018. Preliminary fair values for assets acquired and liabilities assumed are not reported herein as the Company is still in the process of completing the initial accounting for the acquisition.