Annual report pursuant to Section 13 and 15(d)

ACQUISITION

v3.6.0.2
ACQUISITION
 12 Months Ended
Dec. 31, 2016
Business Combinations [Abstract]  
ACQUISITION
NOTE 2.
ACQUISITION
 
On January 31, 2015, the Company completed its acquisition of Metro Bancshares, Inc. (“Metro”) and Metro Bank, Metro’s wholly-owned bank subsidiary, for an aggregate of $20.9 million in cash and 1,273,184 shares of Company common stock. The acquisition of Metro was the Company’s entrance into the greater Atlanta, Georgia area with two added banking offices.
 
The following table provides a summary of the assets acquired and liabilities assumed as recorded by Metro, the fair value adjustments necessary to adjust those acquired assets and assumed liabilities to estimated fair value, and the resultant fair values of those assets and liabilities as recorded by the Company.
 
 
 
January 31, 2015
 
 
 
As recorded by
 
Fair value
 
 
 
As recorded by
 
 
 
Metro
 
adjustments
 
 
 
the Company
 
Assets acquired:
 
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
$
8,543
 
$
-
 
 
 
$
8,543
 
Debt securities
 
 
28,833
 
 
(41)
 
a
 
 
28,792
 
Equity securities
 
 
499
 
 
-
 
 
 
 
499
 
Loans
 
 
152,869
 
 
(3,874)
 
b
 
 
148,995
 
Allowance for loan losses
 
 
(1,621)
 
 
1,621
 
b
 
 
-
 
Premises and equipment, net
 
 
7,606
 
 
762
 
c
 
 
8,368
 
Accrued interest receivable
 
 
484
 
 
-
 
 
 
 
484
 
Deferred taxes
 
 
754
 
 
3,153
 
d
 
 
3,907
 
Other real estate owned
 
 
2,373
 
 
(25)
 
e
 
 
2,348
 
Bank owned life insurance contracts
 
 
2,685
 
 
-
 
 
 
 
2,685
 
Core deposit intangible
 
 
-
 
 
2,090
 
f
 
 
2,090
 
Other assets
 
 
364
 
 
-
 
 
 
 
364
 
Total assets acquired
 
 
203,389
 
 
3,686
 
 
 
 
207,075
 
Deposits
 
 
175,236
 
 
518
 
g
 
 
175,754
 
Federal funds purchased
 
 
2,175
 
 
-
 
 
 
 
2,175
 
Other borrowings
 
 
1,400
 
 
(4)
 
h
 
 
1,396
 
Accrued interest payable
 
 
89
 
 
-
 
 
 
 
89
 
Other liabilities
 
 
996
 
 
-
 
 
 
 
996
 
Total liabilities assumed
 
 
179,896
 
 
514
 
 
 
 
180,410
 
Net assets acquired
 
$
23,493
 
$
3,172
 
 
 
$
26,665
 
Consideration Paid:
 
 
 
 
 
 
 
 
 
 
 
 
Cash
 
 
 
 
 
 
 
 
 
$
(20,926)
 
Stock
 
 
 
 
 
 
 
 
 
 
(19,356)
 
Total consideration paid
 
 
 
 
 
 
 
 
 
 
(40,282)
 
Goodwill
 
 
 
 
 
 
 
 
 
$
13,617
 
  
Explanation of fair value adjustments:
a-
Adjustment reflects the fair value adjustment based on the Company’s pricing of the acquired debt securities portfolio.
b-
Adjustment reflects the fair value adjustment based on the Company’s evaluation of the acquired loan portfolio and to eliminate the recorded allowance for loan losses.
c-
Adjustment reflects the fair value adjustment based on the Company’s evaluation of the premises and equipment acquired.
d-
Adjustment reflects the differences in the carrying values of acquired assets and assumed liabilities for financial statement purposes and their basis for federal income tax purposes.
e-
Adjustment reflects the fair value adjustment based on the Company’s evaluation of the other real estate owned acquired.
f-
Adjustment reflects the fair value adjustment for the core deposit intangible asset recorded as a result of the acquisition.
g-
Adjustment reflects the fair value adjustment based on the Company’s evaluation of the acquired deposits.
h-
Adjustment reflects the fair value adjustment based on the Company’s evaluation of the assumed debt.
 
The estimated fair value of the purchased credit impaired loans acquired in the Metro transaction on January 31, 2015 was $5.1 million, which amount is immaterial to the Company’s consolidated financial statements.
 
Pro forma financial information is not provided because such amounts are immaterial to the Company’s consolidated financial statements.