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SECURITIES (Tables)

12 Months Ended

Dec. 31, 2019

Schedule of Available-For-Sale Securities


			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
(dollars in thousands)	Cost		Gain		Losses		Value
2019
Mortgage-backed securities: residential	$	283,817	$	4,751	$	(387)	$	288,181
Mortgage-backed securities: commercial		36,712		262		(2)		36,972
State and municipal securities		270,480		12,828		(228)		283,080
Total	$	591,009	$	17,841	$	(617)	$	608,233

2018
U.S. Treasury securities	$	994	$	0	$	(7)	$	987
U.S. government sponsored agencies		4,435		0		(85)		4,350
Mortgage-backed securities: residential		329,516		1,392		(5,496)		325,412
Mortgage-backed securities: commercial		38,712		0		(571)		38,141
State and municipal securities		217,964		1,403		(2,708)		216,659
Total	$	591,621	$	2,795	$	(8,867)	$	585,549

Schedule of Available-For-Sale Securities By Maturity


	Amortized		Fair
(dollars in thousands)	Cost		Value
Due in one year or less	$	4,587	$	4,610
Due after one year through five years		15,115		15,453
Due after five years through ten years		24,962		26,061
Due after ten years		225,816		236,956
		270,480		283,080
Mortgage-backed securities		320,529		325,153
Total debt securities	$	591,009	$	608,233

Schedule of Security proceeds, gross gains and gross losses


(dollars in thousands)	2019		2018		2017
Sales of securities available-for-sale
Proceeds	$	57,114	$	15,302	$	40,877
Gross gains		279		21		267
Gross losses		(137)		(71)		(235)
Number of securities		46		29		50

Schedule of Available-For-Sale Securities Continuous Unrealized Loss Position


	Less than 12 months				12 months or more				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(dollars in thousands)	Value		Losses		Value		Losses		Value		Losses
2019
Mortgage-backed securities: residential	$	23,436	$	112	$	14,174	$	275	$	37,610	$	387
Mortgage-backed securities: commercial		4,591		2		0		0		4,591		2
State and municipal securities		14,188		228		0		0		14,188		228
Total temporarily impaired	$	42,215	$	342	$	14,174	$	275	$	56,389	$	617

2018
U.S. Treasury securities	$	0	$	0	$	987	$	7	$	987	$	7
U.S. government sponsored agencies		0		0		4,350		85		4,350		85
Mortgage-backed securities: residential		11,619		12		217,182		5,484		228,801		5,496
Mortgage-backed securities: commercial		0		0		38,141		571		38,141		571
State and municipal securities		26,229		124		85,982		2,584		112,211		2,708
Total temporarily impaired	$	37,848	$	136	$	346,642	$	8,731	$	384,490	$	8,867

Schedule of securities with unrealized losses


	Less than	12 months
	12 months	or more	Total
2019
Mortgage-backed securities: residential	7	6	13
Mortgage-backed securities: commercial	1	0	1
State and municipal securities	11	0	11
Total temporarily impaired	19	6	25

2018
U.S. Treasury securities	0	1	1
U.S. government sponsored agencies	0	2	2
Mortgage-backed securities: residential	5	84	89
Mortgage-backed securities: commercial	0	9	9
State and municipal securities	35	111	146
Total temporarily impaired	40	207	247

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
ASSETS
Cash and due from banks	$ 68,605	$ 192,290
Short-term investments	30,776	24,632
Total cash and cash equivalents	99,381	216,922
Securities available-for-sale (carried at fair value)	608,233	585,549
Real estate mortgage loans held-for-sale	4,527	2,293
Loans, net of allowance for loan losses of $50,652 and $48,453	4,015,176	3,866,292
Land, premises and equipment, net	60,154	58,097
Bank owned life insurance	83,848	77,106
Federal Reserve and Federal Home Loan Bank Stock	13,772	13,772
Accrued interest receivable	15,391	15,518
Goodwill	4,970	4,970
Other assets	41,293	34,735
Total assets	4,946,745	4,875,254
LIABILITIES
Noninterest bearing deposits	983,307	946,838
Interest bearing deposits	3,150,512	3,097,227
Total deposits	4,133,819	4,044,065
Securities sold under agreements to repurchase	0	75,555
Federal Home Loan Bank advances	170,000	170,000
Subordinated debentures	0	30,928
Total borrowings	170,000	276,483
Accrued interest payable	11,604	10,404
Other liabilities	33,222	22,598
Total liabilities	4,348,645	4,353,550
Commitments, off-balance sheet risks and contingencies (Notes 1 and 18)
STOCKHOLDERS' EQUITY
Common stock: 90,000,000 shares authorized, no par value 25,623,016 shares issued and 25,444,275 outstanding as of December 31, 2019 25,301,732 shares issued and 25,128,773 outstanding as of December 31, 2018	114,858	112,383
Retained earnings	475,247	419,179
Accumulated other comprehensive income (loss)	12,059	(6,191)
Treasury stock, at cost (178,741 shares and 172,959 shares as of December 31, 2019 and 2018, respectively)	(4,153)	(3,756)
Total stockholders' equity	598,011	521,615
Noncontrolling interest	89	89
Total equity	598,100	521,704
Total liabilities and equity	$ 4,946,745	$ 4,875,254

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Net income	$ 87,047	$ 80,411	$ 57,330
Change in securities available-for-sale:
Unrealized holding gain (loss) on securities available-for-sale arising during the period	23,438	(7,339)	2,245
Reclassification adjustment for (gains) losses included in net income	(142)	50	(32)
Net securities gain (loss) activity during the period	23,296	(7,289)	2,213
Tax effect	(4,893)	1,637	(707)
Net of tax amount	18,403	(5,652)	1,506
Defined benefit pension plans:
Net gain (loss) on defined benefit pension plans	(409)	269	97
Amortization of net actuarial loss	205	266	265
Net gain (loss) on activity during the period	(204)	535	362
Tax effect	51	(163)	(151)
Net of tax amount	(153)	372	211
Total other comprehensive income (loss), net of tax	18,250	(5,280)	1,717
Comprehensive income	$ 105,297	$ 75,131	$ 59,047

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables)

12 Months Ended

Dec. 31, 2019

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Schedule of Changes in Accumulated Other Comprehensive Income

The following tables summarize the changes within each classification of accumulated other comprehensive income (loss) for December 31, 2019 and 2018 all shown net of tax:


	Unrealized
	Gains and
	(Losses) on		Defined
	Available-		Benefit
	for-Sales		Pension
(dollars in thousands)	Securities		Items		Total
Balance at December 31, 2018	$	(4,796)	$	(1,395)	$	(6,191)
Other comprehensive income (loss) before reclassification		18,515		(306)		18,209
Amounts reclassified from accumulated other comprehensive income (loss)		(112)		153		41
Net current period other comprehensive income (loss)		18,403		(153)		18,250
Balance at December 31, 2019	$	13,607	$	(1,548)	$	12,059


	Unrealized
	Gains and
	(Losses) on		Defined
	Available-		Benefit
	for-Sales		Pension
(dollars in thousands)	Securities		Items		Total
Balance at December 31, 2017	$	784	$	(1,454)	$	(670)
Other comprehensive income (loss) before reclassification		(5,691)		175		(5,516)
Amounts reclassified from accumulated other comprehensive income (loss)		39		197		236
Net current period other comprehensive income (loss)		(5,652)		372		(5,280)
Adoption of ASU 2018-02		140		(313)		(173)
Adoption of ASU 2016-01		(68)		0		(68)
Balance at December 31, 2018	$	(4,796)	$	(1,395)	$	(6,191)

Reclassification Accumulated Other Comprehensive Income

Reclassifications out of accumulated comprehensive income for the years ended December 31, 2019, 2018 and 2017 are as follows:


Details about	Amount		Affected Line Item
Accumulated Other	Reclassified From		in the Statement
Comprehensive	Accumulated Other		Where Net
Income (Loss) Components	Comprehensive Income (Loss)		Income is Presented
2019
(dollars in thousands)
Realized gains and losses on available-for-sale securities	$	142	Net securities gains (losses)
Tax effect		(30)	Income tax expense
Subtotal		112	Net of tax
Amortization of defined benefit pension items⁽¹⁾		(205)	Salaries and employee benefits
Tax effect		52	Income tax expense
Subtotal		(153)	Net of tax
Total reclassifications for the period	$	(41)	Net income


2018
(dollars in thousands)
Realized gains and losses on available-for-sale securities	$	(50)	Net securities gains (losses)
Tax effect		11	Income tax expense
Subtotal		(39)	Net of tax
Amortization of defined benefit pension items⁽¹⁾		(266)	Salaries and employee benefits
Tax effect		69	Income tax expense
Subtotal		(197)	Net of tax
Total reclassifications for the period	$	(236)	Net income


2017
(dollars in thousands)
Realized gains and losses on available-for-sale securities	$	32	Net securities gains (losses)
Tax effect		(13)	Income tax expense
Subtotal		19	Net of tax
Amortization of defined benefit pension items⁽¹⁾		(265)	Salaries and employee benefits
Tax effect		104	Income tax expense
Subtotal		(161)	Net of tax
Total reclassifications for the period	$	(142)	Net income

(1)	Included in the computation of net pension plan expense as more fully discussed in Note 11 – Pension and Other Postretirement Plans.

ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY - Additional Information (Details) - USD ($)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Troubled Debt Restructuring [Abstract]
Loans Modified In Troubled Debt Restructured Loans	$ 2,500,000	$ 3,700,000
Financing Receivable, Troubled Debt Restructuring, Subsequent Default	601,000	0	$ 0
Loan amount of credit quality analysis	250,000
Construction and land development loans
Troubled Debt Restructuring [Abstract]
Financing Receivable, Modifications, Recorded Investment	2,400,000	1,400,000
Commercial and Industrial Loans
Troubled Debt Restructuring [Abstract]
Increase (decrease) in allowance for loan loss			513,000
Financing Receivable, Modifications, Recorded Investment			1,900,000
Commercial and Industrial Loans \| Non-working capital loans
Troubled Debt Restructuring [Abstract]
Financing Receivable, Modifications, Recorded Investment			2,500,000
Commercial Real Estate and Multi-family Residential Loans
Troubled Debt Restructuring [Abstract]
Increase (decrease) in allowance for loan loss			$ 27,000
Financing Receivable, Modifications, Recorded Investment	1,900,000	1,300,000
Consumer 1-4 Family Mortgage Loans
Troubled Debt Restructuring [Abstract]
Increase (decrease) in allowance for loan loss	$ 484,000	189,000
Financing Receivable, Modifications, Recorded Investment		$ 593,000

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	12 Months Ended
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Cash flows from operating activities:
Net income	$ 87,047,000	$ 80,411,000	$ 57,330,000
Adjustments to reconcile net income to net cash from operating activities:
Depreciation	5,930,000	5,654,000	5,119,000
Provision for loan losses	3,235,000	6,400,000	3,000,000
Net loss on sale and write down of other real estate owned	0	16,000	12,000
Amortization of loan servicing rights	528,000	503,000	599,000
Loans originated for sale	(66,008,000)	(49,816,000)	(54,188,000)
Net gain on sales of loans	(2,043,000)	(1,713,000)	(1,749,000)
Proceeds from sale of loans	64,820,000	51,715,000	57,621,000
Net (gain) loss on sale of premises and equipment	(3,000)	1,000	79,000
Net (gain) loss on sales and calls of securities available-for-sale	(142,000)	50,000	(32,000)
Net amortization of available-for-sale securities	3,947,000	3,177,000	3,114,000
Stock based compensation expense	4,187,000	5,608,000	5,698,000
Earnings on life insurance	(1,890,000)	(1,244,000)	(1,768,000)
Gain on life insurance	(841,000)	(206,000)	0
Tax benefit of stock award issuances	(529,000)	(761,000)	(964,000)
Net change:
Interest receivable and other assets	(4,733,000)	(3,301,000)	787,000
Interest payable and other liabilities	6,534,000	8,481,000	2,584,000
Total adjustments	12,992,000	24,564,000	19,912,000
Net cash from operating activities	100,039,000	104,975,000	77,242,000
Cash flows from investing activities:
Proceeds from sale of securities available-for-sale	57,114,000	15,302,000	40,877,000
Proceeds from maturities, calls and principal paydowns of securities available-for-sale	67,818,000	53,817,000	61,745,000
Purchases of securities available-for-sale	(129,453,000)	(126,551,000)	(139,252,000)
Purchase of life insurance	(5,552,000)	(423,000)	(580,000)
Net increase in total loans	(152,119,000)	(101,670,000)	(347,217,000)
Proceeds from sales of land, premises and equipment	14,000	461,000	10,000
Purchases of land, premises and equipment	(7,998,000)	(7,968,000)	(9,582,000)
Purchase of Federal Home Loan Bank Stock	0	0	(2,250,000)
Proceeds from sales of other real estate owned	0	21,000	199,000
Proceeds from life insurance	1,483,000	569,000	0
Net cash from investing activities	(168,693,000)	(166,442,000)	(396,050,000)
Cash flows from financing activities:
Net increase in total deposits	89,754,000	35,410,000	430,743,000
Net increase (decrease) in short-term borrowings	(75,555,000)	174,903,000	20,607,000
Proceeds from short-term FHLB borrowings	0	0	80,000,000
Payments on short term FHLB borrowings	0	(80,000,000)	(180,000,000)
Payments on long-term FHLB borrowings	0	(30,000)	(2,000)
Payments on subordinated debentures	(30,928,000)	0	0
Common dividends paid	(29,639,000)	(25,278,000)	(21,396,000)
Preferred dividends paid	(13,000)	(13,000)	(13,000)
Payments related to equity incentive plan	(2,109,000)	(2,435,000)	(1,736,000)
Purchase of treasury stock	(515,000)	(463,000)	(495,000)
Sales of treasury stock	118,000	115,000	0
Net cash from financing activities	(48,887,000)	102,209,000	327,708,000
Net change in cash and cash equivalents	(117,541,000)	40,742,000	8,900,000
Cash and cash equivalents at beginning of the year	216,922,000	176,180,000	167,280,000
Cash and cash equivalents at end of the year	99,381,000	216,922,000	176,180,000
Cash paid during the year for:
Interest	58,964,000	43,606,000	29,171,000
Income taxes	21,035,000	19,033,000	29,120,000
Supplemental non-cash disclosures:
Loans transferred to other real estate owned	0	316,000	88,000
Property transferred to held for sale	0	221,000	0
Right-of-use assets obtained in exchange for lease liabilities	$ 5,483,000	$ 0	$ 0

ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY - Loans Individually Evaluated For Impairment (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Loans Individually Evaluated for Impairment [Abstract]
Unpaid Principal Balance	$ 30,422	$ 32,194
Recorded Investment	27,829	26,717
Allowance for Loan Losses Allocated	10,384	10,029
Average Recorded Investment	26,464	18,035	$ 18,570
Interest Income Recognized	770	442	584
Cash Basis Interest Income Recognized	651	306	549
Other Consumer Loans
Loans Individually Evaluated for Impairment [Abstract]
Unpaid principal balance with an allowance recorded	17	45
Recorded investment with an allowance recorded	17	44
Allowance for loans losses allocated with an allowance recorded	6	26
Average Recorded Investment with an allowance recorded	21	47
Interest Income Recognized with an allowance recorded	2	3
Cash basis interest income recognized with an allowance recorded	1	3
Commercial and Industrial Loans
Loans Individually Evaluated for Impairment [Abstract]
Allowance for Loan Losses Allocated	9,324	8,552
Commercial and Industrial Loans \| Working capital lines of credit loans
Loans Individually Evaluated for Impairment [Abstract]
Unpaid principal balance with no related allowance recorded	22
Unpaid principal balance with an allowance recorded	6,214	9,691
Recorded Investment with no related allowance recorded	22
Recorded investment with an allowance recorded	6,214	6,694
Allowance for loan losses allocated with no related allowance recorded	0
Allowance for loans losses allocated with an allowance recorded	3,089	2,602
Average Recorded Investment with no related allowance recorded	176	785	407
Average Recorded Investment with an allowance recorded	6,335	3,307	2,083
Interest Income Recognized with no related allowance recorded	9	26	46
Interest Income Recognized with an allowance recorded	143	74	17
Cash basis interest income recognized with no related allowance recorded	9	23	39
Cash basis interest income recognized with an allowance recorded	81	12	17
Commercial and Industrial Loans \| Non-working capital loans
Loans Individually Evaluated for Impairment [Abstract]
Unpaid principal balance with no related allowance recorded	2,130	3,284
Unpaid principal balance with an allowance recorded	13,230	11,099
Recorded Investment with no related allowance recorded	735	1,889
Recorded investment with an allowance recorded	12,609	11,151
Allowance for loan losses allocated with no related allowance recorded	0	0
Allowance for loans losses allocated with an allowance recorded	6,235	5,950
Average Recorded Investment with no related allowance recorded	1,170	1,862	1,341
Average Recorded Investment with an allowance recorded	11,800	5,328	5,715
Interest Income Recognized with no related allowance recorded	40	74	57
Interest Income Recognized with an allowance recorded	448	138	103
Cash basis interest income recognized with no related allowance recorded	30	68	51
Cash basis interest income recognized with an allowance recorded	410	81	103
Commercial Real Estate and Multi-family Residential Loans
Loans Individually Evaluated for Impairment [Abstract]
Allowance for Loan Losses Allocated	538	921
Commercial Real Estate and Multi-family Residential Loans \| Construction and land development loans
Loans Individually Evaluated for Impairment [Abstract]
Unpaid principal balance with an allowance recorded		291
Recorded investment with an allowance recorded		291
Allowance for loans losses allocated with an allowance recorded		142
Average Recorded Investment with no related allowance recorded		58	110
Average Recorded Investment with an allowance recorded		453	69
Interest Income Recognized with no related allowance recorded		5	5
Interest Income Recognized with an allowance recorded		26	5
Cash basis interest income recognized with no related allowance recorded		4	5
Cash basis interest income recognized with an allowance recorded		29	0
Commercial Real Estate and Multi-family Residential Loans \| Owner occupied loans
Loans Individually Evaluated for Impairment [Abstract]
Unpaid principal balance with no related allowance recorded	3,189	1,773
Unpaid principal balance with an allowance recorded	1,988	2,938
Recorded Investment with no related allowance recorded	3,010	1,527
Recorded investment with an allowance recorded	1,988	2,448
Allowance for loan losses allocated with no related allowance recorded	0	0
Allowance for loans losses allocated with an allowance recorded	538	779
Average Recorded Investment with no related allowance recorded	2,354	2,291	2,349
Average Recorded Investment with an allowance recorded	1,849	1,631	1,664
Interest Income Recognized with no related allowance recorded	34	36	17
Interest Income Recognized with an allowance recorded	43	9	3
Cash basis interest income recognized with no related allowance recorded	34	37	15
Cash basis interest income recognized with an allowance recorded	39	1	2
Commercial Real Estate and Multi-family Residential Loans \| Nonowner occupied loans
Loans Individually Evaluated for Impairment [Abstract]
Average Recorded Investment with no related allowance recorded			3,009
Interest Income Recognized with no related allowance recorded			294
Cash basis interest income recognized with no related allowance recorded			284
Agri-business and Agricultural Loans
Loans Individually Evaluated for Impairment [Abstract]
Allowance for Loan Losses Allocated	90	73
Agri-business and Agricultural Loans \| Loans secured by farmland
Loans Individually Evaluated for Impairment [Abstract]
Unpaid principal balance with no related allowance recorded	603	603
Unpaid principal balance with an allowance recorded	147	150
Recorded Investment with no related allowance recorded	283	283
Recorded investment with an allowance recorded	147	150
Allowance for loan losses allocated with no related allowance recorded	0	0
Allowance for loans losses allocated with an allowance recorded	90	73
Average Recorded Investment with no related allowance recorded	283	283	287
Average Recorded Investment with an allowance recorded	147	12	2
Interest Income Recognized with no related allowance recorded	0	0	0
Interest Income Recognized with an allowance recorded	3	1	0
Cash basis interest income recognized with no related allowance recorded	0	0	0
Cash basis interest income recognized with an allowance recorded	1	0	0
Agri-business and Agricultural Loans \| Loans for agricultural production
Loans Individually Evaluated for Impairment [Abstract]
Unpaid principal balance with no related allowance recorded	15
Recorded Investment with no related allowance recorded	15
Allowance for loan losses allocated with no related allowance recorded	0
Average Recorded Investment with no related allowance recorded	4
Interest Income Recognized with no related allowance recorded	0
Cash basis interest income recognized with no related allowance recorded	0
Agri-business and Agricultural Loans \| Open end and junior lien loans
Loans Individually Evaluated for Impairment [Abstract]
Unpaid principal balance with an allowance recorded	641
Recorded investment with an allowance recorded	640
Allowance for loans losses allocated with an allowance recorded	53
Agri-business and Agricultural Loans \| Residential construction loans
Loans Individually Evaluated for Impairment [Abstract]
Unpaid principal balance with an allowance recorded	51
Recorded investment with an allowance recorded	52
Allowance for loans losses allocated with an allowance recorded	10
Consumer 1-4 Family Mortgage Loans
Loans Individually Evaluated for Impairment [Abstract]
Allowance for Loan Losses Allocated	426	457
Consumer 1-4 Family Mortgage Loans \| Closed end first mortgage loans
Loans Individually Evaluated for Impairment [Abstract]
Unpaid principal balance with no related allowance recorded	411	583
Unpaid principal balance with an allowance recorded	1,643	1,517
Recorded Investment with no related allowance recorded	330	502
Recorded investment with an allowance recorded	1,646	1,518
Allowance for loan losses allocated with no related allowance recorded	0	0
Allowance for loans losses allocated with an allowance recorded	363	457
Average Recorded Investment with no related allowance recorded	272	521	293
Average Recorded Investment with an allowance recorded	1,643	1,214	1,006
Interest Income Recognized with no related allowance recorded	3	13	9
Interest Income Recognized with an allowance recorded	45	37	25
Cash basis interest income recognized with no related allowance recorded	3	12	8
Cash basis interest income recognized with an allowance recorded	43	36	22
Consumer 1-4 Family Mortgage Loans \| Open end and junior lien loans
Loans Individually Evaluated for Impairment [Abstract]
Unpaid principal balance with no related allowance recorded	121	220
Recorded Investment with no related allowance recorded	121	220
Allowance for loan losses allocated with no related allowance recorded	0	0
Average Recorded Investment with no related allowance recorded	133	205	103
Average Recorded Investment with an allowance recorded	268	38	80
Interest Income Recognized with no related allowance recorded	0	0	0
Interest Income Recognized with an allowance recorded	0	0	0
Cash basis interest income recognized with no related allowance recorded	0	0	0
Cash basis interest income recognized with an allowance recorded	0	$ 0	0
Consumer 1-4 Family Mortgage Loans \| Residential construction loans
Loans Individually Evaluated for Impairment [Abstract]
Average Recorded Investment with an allowance recorded	9
Interest Income Recognized with an allowance recorded	0
Cash basis interest income recognized with an allowance recorded	$ 0
Consumer 1-4 Family Mortgage Loans \| Other Consumer Loans
Loans Individually Evaluated for Impairment [Abstract]
Average Recorded Investment with an allowance recorded			52
Interest Income Recognized with an allowance recorded			3
Cash basis interest income recognized with an allowance recorded			$ 3

FAIR VALUE - Additional Information (Details) - USD ($)	12 Months Ended
FAIR VALUE - Additional Information (Details) - USD ($)	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Mortgage servicing rights	$ 4,400,000
Percentage of discount from appraised value (in hundredths)	3.90%
Weighted average maturity of residential mortgages	20 years
Prepayment Speed used in unobservable assumptions	118	81
Discount rate used to estimate fair value (in hundredths)	9.40%	9.40%
Subtotal	$ 4,067,385,000	$ 3,916,326,000
Valuation allowance	50,652,000	48,453,000	$ 47,121,000	$ 43,718,000
Provision for Loan and Lease Losses	3,235,000	6,400,000	3,000,000
Allowance for Loan and Lease Loss, Recovery of Bad Debts	874,000	1,043,000	$ 1,963,000
Ten Percent Adverse Changes In Psa
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Mortgage servicing rights	124,000
Twenty Percent Adverse Changes In Psa
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Mortgage servicing rights	242,000
Ten Percent Adverse Changes In Discount Rate
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Mortgage servicing rights	170,000
Twenty Percent Adverse Changes In Discount Rate
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Mortgage servicing rights	329,000
Minimum
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Amount of variance	$ 100,000
Minimum \| Municipal Notes
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Percentage of Variance	(5.00%)
Minimum \| US Government Agencies Short-term Debt Securities
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Percentage of Variance	(3.00%)
Minimum \| US Treasury Securities
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Percentage of Variance	(1.00%)
Maximum \| Municipal Notes
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Percentage of Variance	5.00%
Maximum \| US Government Agencies Short-term Debt Securities
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Percentage of Variance	3.00%
Maximum \| US Treasury Securities
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Percentage of Variance	1.00%
Commercial Real Estates \| Minimum \| Level 3
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Percentage of discount from appraised value (in hundredths)	0.00%
Commercial Real Estates \| Maximum \| Level 3
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Percentage of discount from appraised value (in hundredths)	50.00%
Inventory Finished Goods \| Minimum \| Level 3
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Percentage of discount from appraised value (in hundredths)	35.00%
Inventory Finished Goods \| Maximum \| Level 3
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Percentage of discount from appraised value (in hundredths)	65.00%
Finished Goods \| Minimum \| Level 3
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Percentage of discount from appraised value (in hundredths)	30.00%
Finished Goods \| Maximum \| Level 3
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Percentage of discount from appraised value (in hundredths)	60.00%
Inventory Work In Process \| Minimum \| Level 3
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Percentage of discount from appraised value (in hundredths)	50.00%
Inventory Work In Process \| Maximum \| Level 3
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Percentage of discount from appraised value (in hundredths)	100.00%
Equipment \| Minimum \| Level 3
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Percentage of discount from appraised value (in hundredths)	30.00%
Equipment \| Maximum \| Level 3
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Percentage of discount from appraised value (in hundredths)	70.00%
Marketable Securities \| Minimum \| Level 3
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Percentage of discount from appraised value (in hundredths)	10.00%
Marketable Securities \| Maximum \| Level 3
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Percentage of discount from appraised value (in hundredths)	30.00%
Impaired Loans
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Subtotal	$ 22,200,000	21,000,000.0
Valuation allowance	10,100,000	9,500,000
Allowance for Loan and Lease Loss, Recovery of Bad Debts	600,000,000,000	7,100,000
Other Real Estate Owned
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Impaired Loans Fair Value Disclosure	$ 316,000	$ 316,000

COMMITMENTS, OFF-BALANCE SHEET RISKS AND CONTINGENCIES (Tables)

12 Months Ended

Dec. 31, 2019

COMMITMENTS, OFF-BALANCE SHEET RISKS AND CONTINGENCIES

Schedule of Financial Instruments Commitments

These financial instruments include commitments to make loans and open-ended revolving lines of credit. Amounts as of the years ended December 31, 2019 and 2018, were as follows:


	2019				2018
	Fixed		Variable		Fixed		Variable
(dollars in thousands)	Rate		Rate		Rate		Rate
Commercial loan lines of credit	$	39,104	$	1,451,704	$	63,625	$	1,337,437
Commercial letters of credit		0		0		0		3,245
Standby letters of credit		0		70,932		0		81,512
Real estate mortgage loans		4,448		1,488		2,811		2,881
Real estate construction mortgage loans		478		2,139		400		2,189
Home equity mortgage open-ended revolving lines		0		247,562		0		232,362
Consumer loan open-ended revolving lines		180		17,116		215		14,468
Total	$	44,210	$	1,790,941	$	67,051	$	1,674,094

Schedule Of Rate Of Interest Percentage Financial Instruments

Interest rate ranges on commitments and open-ended revolving lines of credit for years ended December 31, 2019 and 2018, were as follows:


	2019				2018
	Fixed		Variable		Fixed		Variable
	Rate		Rate		Rate		Rate
Commercial loan	0.75-14.50	%	2.65-9.25	%	0.75-14.50	%	2.65-10.00	%
Real estate mortgage loan	3.13-4.00	%	3.75-4.25	%	3.75-6.13	%	3.75-11.00	%
Consumer loan open-ended revolving line	15.00	%	3.88-15.00	%	15.00	%	3.88-15.00	%

GOODWILL AND OTHER INTANGIBLE ASSETS

12 Months Ended

Dec. 31, 2019

GOODWILL AND OTHER INTANGIBLE ASSETS

GOODWILL AND OTHER INTANGIBLE ASSETS

NOTE 7 – GOODWILL AND OTHER INTANGIBLE ASSETS

Goodwill

There have been no changes in the $5.0 million carrying amount of goodwill since 2002.

Impairment exists when a reporting unit’s carrying value of goodwill exceeds its fair value, which is determined through a two-step impairment test. Step 1 of the impairment test includes the determination of the carrying value of our single reporting unit, including the existing goodwill and intangible assets, and estimating the fair value of the reporting unit. The Company determined the fair value of our reporting unit and compared it to its carrying amount. If the carrying amount of a reporting unit exceeds its fair value, the Company is required to perform a second step to the impairment test. Our annual impairment analysis as of May 31, 2019, indicated that the Step 2 analysis was not necessary. Circumstances did not substantially change during the second half of the year such that the Company did not believe it was necessary to do an additional impairment analysis.

ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY - Allowance for loan losses by portfolio segment (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Financing Receivable, Allowance for Credit Losses
Beginning balance	$ 48,453	$ 47,121	$ 43,718
Provision for loan losses	3,235	6,400	3,000
Loans charged-off	(1,910)	(6,111)	(1,560)
Recoveries	874	1,043	1,963
Net loans (charged-off) recovered	(1,036)	(5,068)	403
Ending balance	50,652	48,453	47,121
Commercial and Industrial Loans
Financing Receivable, Allowance for Credit Losses
Beginning balance	22,518	21,097	20,272
Provision for loan losses	4,259	5,884	614
Loans charged-off	(1,447)	(5,215)	(842)
Recoveries	459	752	1,053
Net loans (charged-off) recovered	(988)	(4,463)	211
Ending balance	25,789	22,518	21,097
Commercial Real Estate and Multi-family Residential Loans
Financing Receivable, Allowance for Credit Losses
Beginning balance	15,393	14,714	13,452
Provision for loan losses	259	1,140	997
Loans charged-off	(17)	(491)	(406)
Recoveries	161	30	671
Net loans (charged-off) recovered	144	(461)	265
Ending balance	15,796	15,393	14,714
Agri-business and Agricultural Loans
Financing Receivable, Allowance for Credit Losses
Beginning balance	4,305	4,920	3,532
Provision for loan losses	(444)	(657)	1,365
Loans charged-off	0	0	0
Recoveries	8	42	23
Net loans (charged-off) recovered	8	42	23
Ending balance	3,869	4,305	4,920
Other Commercial
Financing Receivable, Allowance for Credit Losses
Beginning balance	368	577	461
Provision for loan losses	79	(209)	116
Loans charged-off	0	0	0
Recoveries	0	0	0
Net loans (charged-off) recovered	0	0	0
Ending balance	447	368	577
Consumer 1-4 Family Mortgage Loans
Financing Receivable, Allowance for Credit Losses
Beginning balance	2,292	2,768	2,827
Provision for loan losses	(219)	(536)	(105)
Loans charged-off	(110)	(48)	(53)
Recoveries	123	108	99
Net loans (charged-off) recovered	13	60	46
Ending balance	2,086	2,292	2,768
Other Consumer
Financing Receivable, Allowance for Credit Losses
Beginning balance	283	379	387
Provision for loan losses	275	150	134
Loans charged-off	(336)	(357)	(259)
Recoveries	123	111	117
Net loans (charged-off) recovered	(213)	(246)	(142)
Ending balance	345	283	379
Unallocated
Financing Receivable, Allowance for Credit Losses
Beginning balance	3,294	2,666	2,787
Provision for loan losses	(974)	628	(121)
Loans charged-off	0	0	0
Recoveries	0	0	0
Net loans (charged-off) recovered	0	0	0
Ending balance	$ 2,320	$ 3,294	$ 2,666

DEPOSITS - Additional information (Details) $ in Millions	Dec. 31, 2019 USD ($)
DEPOSITS
Total amount available to the Bank	$ 200.0
Total amount drawn	$ 75.1

REVENUE RECOGNITION - Additional Information (Details)	Jan. 02, 2018 USD ($)
Retained Earnings
New Accounting Pronouncement or Change in Accounting Principle, Effect of Change on Net Income	$ 24,000

SUBORDINATED DEBENTURES (Details) - USD ($)		9 Months Ended	12 Months Ended
SUBORDINATED DEBENTURES (Details) - USD ($)	Dec. 31, 2019	Oct. 01, 2003	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Subordinated Debentures Disclosure [Abstract]
Proceeds from Issuance of Trust Preferred Securities		$ 30,000,000.0
Trust preferred securities and subordinated debentures, description of variable rate basis				(“LIBOR”) plus 3.05%
Floating rate of trust preferred securities and subordinated debentures				5.85%
Investment In Common Stock			$ 0	$ 928,000
Proceeds From Issuance Of Subordinated Debentures		$ 30,900,000
Integral multiple subordinated debentures may be redeemed in	$ 1,000		$ 1,000
Percentage of principal amount subordinated debentures may be redeemed at	100.00%		100.00%
Payments for redemption of trust preferred securities	$ 30,000,000.0
Payments for redemption of common securities	$ 928,000		$ 515,000	$ 463,000	$ 495,000
Concurrent redemption of junior subordinated debentures	100.00%		100.00%
Redemption price as a percentage of principal amount	100.00%
Redemption of the outstanding common securities and the outstanding trust preferred securities	100.00%

GOODWILL AND OTHER INTANGIBLE ASSETS (Details) $ in Millions	Dec. 31, 2019 USD ($)
GOODWILL AND OTHER INTANGIBLE ASSETS
Carrying amount of goodwill	$ 5.0

LEASES (Details) $ in Thousands	12 Months Ended
LEASES (Details) $ in Thousands	Dec. 31, 2019 USD ($)
LEASES
2020	$ 561
2021	581
2022	595
2023	606
2024	622
2025 and thereafter	2,873
Total undiscounted lease payments	5,838
Less imputed interest	(738)
Lease liability	$ 5,100
Operating Lease, Liability, Statement of Financial Position [Extensible List]	Other Liabilities
Right-of-use asset	$ 5,100
Lease cost
Operating lease cost	498
Short-term lease cost	24
Total lease cost	522
Operating cash outflows from operating leases	$ 498
Weighted-average remaining lease term - operating leases	9 years 9 months 18 days
Weighted average discount rate - operating leases	2.80%

COMMITMENTS, OFF-BALANCE SHEET RISKS AND CONTINGENCIES - Commitments To Make Loans And Open Ended Revolving Lines Of Credit (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Commitments Off-Balance Sheet Risks and Contingencies
Fixed Rate	$ 44,210	$ 67,051
Variable Rate	1,790,941	1,674,094
Working capital lines of credit loans
Commitments Off-Balance Sheet Risks and Contingencies
Fixed Rate	39,104	63,625
Variable Rate	1,451,704	1,337,437
Commercial Letters Of Credit [Member]
Commitments Off-Balance Sheet Risks and Contingencies
Fixed Rate	0	0
Variable Rate	0	3,245
Standby Letters of Credit [Member]
Commitments Off-Balance Sheet Risks and Contingencies
Fixed Rate	0	0
Variable Rate	70,932	81,512
Real Estate Mortgage Loans [Member]
Commitments Off-Balance Sheet Risks and Contingencies
Fixed Rate	4,448	2,811
Variable Rate	1,488	2,881
Real Estate Construction Mortgage Loans [Member]
Commitments Off-Balance Sheet Risks and Contingencies
Fixed Rate	478	400
Variable Rate	2,139	2,189
Residential construction loans
Commitments Off-Balance Sheet Risks and Contingencies
Fixed Rate	0	0
Variable Rate	247,562	232,362
Consumer loan open-ended revolving line
Commitments Off-Balance Sheet Risks and Contingencies
Fixed Rate	180	215
Variable Rate	$ 17,116	$ 14,468

EARNINGS PER SHARE - Earnings Per Share Computations (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Basic earnings per common share:
Net income	$ 22,198	$ 21,454	$ 21,713	$ 21,682	$ 21,363	$ 20,570	$ 20,142	$ 18,336	$ 87,047	$ 80,411	$ 57,330
Weighted-average common shares outstanding									25,588,404	25,288,533	25,181,208
Basic earnings per common share	$ 0.86	$ 0.84	$ 0.85	$ 0.85	$ 0.84	$ 0.81	$ 0.80	$ 0.73	$ 3.40	$ 3.18	$ 2.28
Diluted earnings per common share:
Net income	$ 22,198	$ 21,454	$ 21,713	$ 21,682	$ 21,363	$ 20,570	$ 20,142	$ 18,336	$ 87,047	$ 80,411	$ 57,330
Weighted-average common shares outstanding for basic earnings per common share									25,588,404	25,288,533	25,181,208
Add: Dilutive effect of assumed exercise of warrant									0	225,831	219,273
Add: Dilutive effect of assumed exercises of stock options and awards									170,489	213,467	262,900
Average shares and dilutive potential common shares									25,758,893	25,727,831	25,663,381
Diluted earnings per common share	$ 0.86	$ 0.83	$ 0.85	$ 0.84	$ 0.83	$ 0.80	$ 0.79	$ 0.71	$ 3.38	$ 3.13	$ 2.23

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

+ References

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- Definition

The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

+ References

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+ Details

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References + Details

SELECTED QUARTERLY DATA (UNAUDITED) (Tables)

12 Months Ended

Dec. 31, 2019

SELECTED QUARTERLY DATA (UNAUDITED)

Schedule of Quarterly Financial Information

4th

3rd

2nd

1st

2019

Quarter

Interest income

52,312

54,769

54,635

53,494

Interest expense

13,430

15,224

16,224

15,285

Net interest income

38,882

39,545

38,411

38,209

Provision for loan losses

250

1,000

785

1,200

Net interest income after provision

38,632

38,545

37,626

37,009

Noninterest income

11,119

10,765

11,588

11,525

Noninterest expense

22,122

22,737

22,092

22,473

Income tax expense

5,431

5,119

5,409

4,379

Net income

22,198

21,454

21,713

21,682

Basic earnings per common share

0.86

0.84

0.85

Diluted earnings per common share

0.86

0.83

0.85

0.84


	4th		3rd		2nd		1st
2018	Quarter		Quarter		Quarter		Quarter
Interest income	$	53,728	$	50,379	$	48,795	$	46,068
Interest expense		14,138		12,454		11,262		9,845
Net interest income		39,590		37,925		37,533		36,223
Provision for loan losses		300		1,100		1,700		3,300
Net interest income after provision		39,290		36,825		35,833		32,923
Noninterest income		10,077		10,624		9,722		9,879
Noninterest expense		22,524		22,200		20,303		21,202
Income tax expense		5,480		4,679		5,110		3,264
Net income	$	21,363	$	20,570	$	20,142	$	18,336

Basic earnings per common share	$	0.84	$	0.81	$	0.80	$	0.73
Diluted earnings per common share	$	0.83	$	0.80	$	0.79	$	0.71

ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY - Troubled Debt Restructuring (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Troubled Debt Restructuring [Abstract]
Accruing troubled debt restructured loans	$ 5,909	$ 8,016
Nonaccrual troubled debt restructured loans	3,188	4,384
Total troubled debt restructured loans	$ 9,097	$ 12,400

CAPITAL REQUIREMENTS AND RESTRICTIONS ON RETAINED EARNINGS

12 Months Ended

Dec. 31, 2019

CAPITAL REQUIREMENTS AND RESTRICTIONS ON RETAINED EARNINGS

CAPITAL REQUIREMENTS AND RESTRICTIONS ON RETAINED EARNINGS

NOTE 16 – CAPITAL REQUIREMENTS AND RESTRICTIONS ON RETAINED EARNINGS

The Company became a financial holding company effective May 30, 2012 and is now required to be well capitalized under the applicable regulatory guidelines. The Company and the Bank are subject to various regulatory capital requirements administered by federal banking agencies. Failure to meet certain heightened minimum capital requirements can initiate certain mandatory, and possibly discretionary actions by regulators that, if undertaken, could have a direct material effect on the financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and the Bank must meet specific capital guidelines that involve quantitative measures of the assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices. The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weighting and other factors.

The capital adequacy requirements were heightened by the Basel III Rules, which went into effect on January 1, 2015 with a phase-in period for certain aspects of the rule through 2019. Under the Basel III rules, the Company must hold a capital conservation buffer above the adequately capitalized risk-based capital ratios. The capital conservation buffer is being phased in from 0.000% for 2015 to 2.50% by 2019. The capital conservation buffer for 2019 and 2018 was 2.50% and 1.875%, respectively. The net unrealized gain or loss on available-for-sale securities is not included in computing regulatory capital. The quantitative measures established by regulation to ensure capital adequacy that were in effect on December 31, 2019 and 2018, require the Company and the Bank to maintain minimum capital amounts and ratios (set forth in the following table) of Total, Tier I and Common Equity Tier 1 capital (as defined in the regulations) to risk-weighted assets (as defined in the regulation), and of Tier I capital (as defined in the regulation) to average assets (as defined). Management believes, as of the years ended December 31, 2019 and 2018, that the Company and the Bank met all capital adequacy requirements to which they are subject.

NOTE 16 – CAPITAL REQUIREMENTS AND RESTRICTIONS ON RETAINED EARNINGS (continued)

As of December 31, 2019, the most recent notification from the federal regulators categorized the Company and the Bank as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized, the Company and the Bank must maintain minimum Total risk-based capital ratios, Tier I risk-based capital ratios and Tier I leverage capital ratios as set forth in the table. There have been no conditions or events since that notification that management believes have changed the Company and the Bank’s category.


													Minimum Required to
					Minimum Required				For Capital Adequacy				Be Well Capitalized
					For Capital				Purposes Plus Capital				Under Prompt Corrective
	Actual				Adequacy Purposes				Conservation Buffer				Action Regulations
(dollars in thousands)	Amount		Ratio		Amount		Ratio		Amount		Ratio		Amount		Ratio
As of December 31, 2019:
Total Capital (to Risk Weighted Assets)
Consolidated	$	631,723	14.36	%	$	351,894	8.00	%	$	461,862	N/A			N/A	N/A
Bank	$	616,386	14.04	%	$	351,227	8.00	%	$	460,985	10.50	%	$	439,034	10.00	%
Tier I Capital (to Risk Weighted Assets)
Consolidated	$	580,982	13.21	%	$	263,921	6.00	%	$	373,887	N/A			N/A	N/A
Bank	$	565,645	12.88	%	$	263,420	6.00	%	$	373,179	8.50	%	$	351,227	8.00	%
Common Equity Tier 1 (CET1)
Consolidated	$	580,982	13.21	%	$	197,941	4.50	%	$	307,908	N/A			N/A	N/A
Bank	$	565,645	12.88	%	$	197,565	4.50	%	$	307,324	7.00	%	$	285,372	6.50	%
Tier I Capital (to Average Assets)
Consolidated	$	580,982	11.67	%	$	199,099	4.00	%	$	199,099	N/A			N/A	N/A
Bank	$	565,645	11.43	%	$	197,923	4.00	%	$	197,923	4.00	%	$	247,404	5.00	%

As of December 31, 2018:
Total Capital (to Risk Weighted Assets)
Consolidated	$	601,379	14.20	%	$	338,690	8.00	%	$	418,070	N/A			N/A	N/A
Bank	$	583,206	13.80	%	$	338,098	8.00	%	$	417,340	9.875	%	$	422,623	10.00	%
Tier I Capital (to Risk Weighted Assets)
Consolidated	$	552,836	13.06	%	$	254,017	6.00	%	$	333,398	N/A			N/A	N/A
Bank	$	534,664	12.65	%	$	253,574	6.00	%	$	332,815	7.875	%	$	338,098	8.00	%
Common Equity Tier 1 (CET1)
Consolidated	$	522,836	12.35	%	$	190,513	4.50	%	$	269,893	N/A			N/A	N/A
Bank	$	534,664	12.65	%	$	190,180	4.50	%	$	269,422	6.375	%	$	274,705	6.50	%
Tier I Capital (to Average Assets)
Consolidated	$	552,836	11.44	%	$	193,305	4.00	%	$	193,305	N/A			N/A	N/A
Bank	$	534,664	11.06	%	$	193,312	4.00	%	$	193,312	4.00	%	$	241,639	5.00	%

The Bank is required to obtain the approval of the Indiana Department of Financial Institutions for the payment of any dividend if the total amount of all dividends declared by the Bank during the calendar year, including the proposed dividend, would exceed the sum of the retained net income for the year-to-date combined with the retained net income for the previous two years. Indiana law defines “retained net income” to mean the net income of a specified period, calculated under the consolidated report of income instructions, less the total amount of all dividends declared for the specified period. As of December 31, 2019, approximately $89.1 million was available to be paid as dividends to the Company by the Bank.

The payment of dividends by any financial institution or its holding company is affected by the requirement to maintain adequate capital pursuant to applicable capital adequacy guidelines and regulations, and a financial institution generally is prohibited from paying any dividends if, following payment thereof, the institution would be undercapitalized. As described above, the Bank exceeded its minimum capital requirements under applicable guidelines as of December 31, 2019. Notwithstanding the availability of funds for dividends however, the FDIC may prohibit the payment of any dividends by the Bank if the FDIC determines such payment would constitute an unsafe or unsound practice.

RELATED PARTY TRANSACTIONS (Tables)

12 Months Ended

Dec. 31, 2019

RELATED PARTY TRANSACTIONS

Schedule of related party transactions

Loans to principal officers, directors, and their affiliates as of December 31, 2019 and 2018 were as follows:


(dollars in thousands)	2019		2018
Beginning balance	$	83,546	$	105,242
New loans and advances		55,465		94,542
Effect of changes in related parties		(5,967)		0
Repayments and renewals		(49,064)		(116,238)
Ending balance	$	83,980	$	83,546

ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY - Balance In The Allowance For Loan Losses And The Recorded Investment In Loans By Portfolio Management (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Ending allowance balance attributable to loans:
Individually evaluated for impairment	$ 10,384	$ 10,029
Collectively evaluated for impairment	40,268	38,424
Total ending allowance balance	50,652	48,453	$ 47,121	$ 43,718
Loans:
Loans individually evaluated for impairment	27,829	26,717
Loans collectively evaluated for impairment	4,037,999	3,888,028
Total ending loans balance	4,065,828	3,914,745
Commercial and Industrial Loans
Ending allowance balance attributable to loans:
Individually evaluated for impairment	9,324	8,552
Collectively evaluated for impairment	16,465	13,966
Total ending allowance balance	25,789	22,518	21,097	20,272
Loans:
Loans individually evaluated for impairment	19,580	19,734
Loans collectively evaluated for impairment	1,407,246	1,385,604
Total ending loans balance	1,426,826	1,405,338
Commercial Real Estate and Multi-family Residential Loans
Ending allowance balance attributable to loans:
Individually evaluated for impairment	538	921
Collectively evaluated for impairment	15,258	14,472
Total ending allowance balance	15,796	15,393	14,714	13,452
Loans:
Loans individually evaluated for impairment	4,998	4,266
Loans collectively evaluated for impairment	1,665,842	1,562,899
Total ending loans balance	1,670,840	1,567,165
Agri-business and Agricultural Loans
Ending allowance balance attributable to loans:
Individually evaluated for impairment	90	73
Collectively evaluated for impairment	3,779	4,232
Total ending allowance balance	3,869	4,305	4,920	3,532
Loans:
Loans individually evaluated for impairment	445	433
Loans collectively evaluated for impairment	379,186	370,174
Total ending loans balance	379,631	370,607
Other Commercial
Ending allowance balance attributable to loans:
Individually evaluated for impairment	0	0
Collectively evaluated for impairment	447	368
Total ending allowance balance	447	368	577	461
Loans:
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	112,166	95,520
Total ending loans balance	112,166	95,520
Consumer 1-4 Family Mortgage Loans
Ending allowance balance attributable to loans:
Individually evaluated for impairment	426	457
Collectively evaluated for impairment	1,660	1,835
Total ending allowance balance	2,086	2,292	2,768	2,827
Loans:
Loans individually evaluated for impairment	2,789	2,240
Loans collectively evaluated for impairment	375,210	388,053
Total ending loans balance	377,999	390,293
Other Consumer
Ending allowance balance attributable to loans:
Individually evaluated for impairment	6	26
Collectively evaluated for impairment	339	257
Total ending allowance balance	345	283	379	387
Loans:
Loans individually evaluated for impairment	17	44
Loans collectively evaluated for impairment	98,349	85,778
Total ending loans balance	98,366	85,822
Unallocated
Ending allowance balance attributable to loans:
Individually evaluated for impairment	0	0
Collectively evaluated for impairment	2,320	3,294
Total ending allowance balance	2,320	3,294	$ 2,666	$ 2,787
Loans:
Loans individually evaluated for impairment	0	0
Loans collectively evaluated for impairment	0	0
Total ending loans balance	$ 0	$ 0

STOCK BASED COMPENSATION

12 Months Ended

Dec. 31, 2019

STOCK BASED COMPENSATION

STOCK BASED COMPENSATION

NOTE 15 – STOCK BASED COMPENSATION

Effective April 8, 2008, the Company adopted the Lakeland Financial Corporation 2008 Equity Incentive Plan (the “2008 Plan”), which was approved by the Company’s stockholders. At its inception there were 1,125,000 shares of common stock reserved for grants of stock options, stock appreciation rights, stock awards and cash incentive awards to employees of the Company, its subsidiaries and Board. Effective April 9, 2013, the Company adopted the Lakeland Financial Corporation 2013 Equity Incentive Plan (the “2013 Plan”), which was also approved by the Company’s stockholders. At its inception the remaining shares of common stock available to grant under the 2008 Plan of 435,867 were transferred to the 2013 Plan and reserved for grants of stock options, stock appreciation rights, stock awards and cash incentive awards to employees of the Company, its subsidiaries and Board. Non-vested shares from the 2008 Plan that are unused at vesting are added to the shares available to grant of the 2013 Plan. Effective April 12, 2017, the Company adopted the Lakeland Financial Corporation 2017 Equity Incentive Plan (the “2017 Plan”), which was also approved by the Company’s stockholders. At its inception there were 1,000,000 shares of common stock reserved for grants of stock options, stock appreciation rights, stock awards and cash incentive awards to employees of the Company, its subsidiaries and Board. As of December 31, 2019, 684,926 shares were available for future grants. Certain stock awards provide for accelerated vesting if there is a change in control. The Company has a policy of issuing new shares to satisfy exercises of stock awards.

Included in net income for the years ended December 31, 2019, 2018 and 2017 was employee stock compensation expense of $4.2 million, $5.6 million and $5.7 million, and a related tax benefit of $1.1 million, $1.5 million and $2.2 million, respectively.

Stock Options

The equity incentive plan requires that the exercise price for options be the market price on the date the options are granted. The maximum option term is ten years and the awards usually vest over three years. The fair value of each stock option is estimated with the Black Scholes pricing model, using the following weighted-average assumptions as of the grant date for stock options granted during the years presented. Expected volatilities are based on historical volatility of the Company’s stock over the immediately preceding expected life period, as well as other factors known on the grant date that would have a significant effect on the stock price during the expected life period. The expected stock option life used is the historical option life of the similar employee base or Board. The turnover rate is based on historical data of the similar employee base as a group and the Board as a group. The risk-free interest rate is the Treasury rate on the date of grant corresponding to the expected life period of the stock option.

There were no stock option grants in 2019, 2018 or 2017. Also, there were no modifications of stock option awards during the years ended December 31, 2019, 2018 and 2017. As of December 31, 2019, there was no unrecognized compensation cost related to non-vested stock options granted under the plan.

NOTE 15 – STOCK BASED COMPENSATION (continued)

All outstanding stock options were exercised during the year ended December 31, 2018. The following table presents information on stock awards exercised for the years ended December 31, 2019, 2018, and 2017.


(dollars in thousands)	2019		2018		2017
Total intrinsic value	$	0	$	243	$	44
Cash received		0		118		24
Actual tax benefit realized for tax deductions		0		0		0

Restricted Stock Awards and Units

The fair value of restricted stock awards and units is the closing price of the Company’s common stock on the date of grant adjusted for the present value of expected dividends. The restricted stock awards fully vest based upon a schedule determined at the grant date, with the exception of 15,600 shares included as vested, below, which vested on the grant date.

A summary of the changes in the Company’s non-vested shares for the year follows:


		Weighted-Average
		Grant-Date
Nonvested Shares	Shares	Fair Value
Nonvested at January 1, 2019	1,000	$	48.14
Granted	19,100		44.59
Vested	(16,600)		44.56
Nonvested at December 31, 2019	3,500	$	45.70

As of December 31, 2019, there was $135,000 of total unrecognized compensation cost related to non-vested shares granted under the plan. The cost is expected to be recognized over a weighted period of 1.01 years. The total fair value of shares vested during the years ended December 31, 2019, 2018 and 2017 was $737,000, $726,000 and $1.2 million, respectively.

Performance Stock Units

The fair value of stock awards is the closing price of the Company’s common stock on the date of grant adjusted for the present value of expected dividends. The expected dividend rate is assumed to be the most recent dividend rate declared by the Board on the grant date. The grant date fair value of stock awards is assumed at the target payout rate. The stock awards fully vest on the third anniversary of the grant date. The 2019-2021, 2018-2020 and 2017-2019 Long-Term Incentive Plans must be paid in stock and have performance conditions which include revenue growth, diluted earnings per share growth and average return on beginning equity. Shares granted below include the number of shares assumed granted based on actual performance criteria of the 2019-2021, 2018-2020 and 2017-2019 Long-Term Incentive Plans at December 31, 2019.


		Weighted-Average
		Grant-Date
Nonvested Shares	Shares	Fair Value
Nonvested at January 1, 2019	368,503	$	39.83
Granted	39,715		41.78
Vested	(126,672)		29.23
Forfeited	(4,461)		45.42
Nonvested at December 31, 2019	277,085	$	44.86

As of December 31, 2019, there was $3.4 million of total unrecognized compensation cost related to non-vested shares granted under the Plan. The cost is expected to be recognized over a weighted period of 1.55 years. The total fair value of shares vested during the year ended December 31, 2019, 2018 and 2017 was $5.7 million, $6.6 million and $5.1 million, respectively. During the years ended December 31, 2019, 2018 and 2017, 126,672, 137,472 and 112,055 shares vested, respectively.

PARENT COMPANY STATEMENTS (Tables)

12 Months Ended

Dec. 31, 2019

PARENT COMPANY STATEMENTS

Schedule of Condensed Balance Sheet

CONDENSED BALANCE SHEETS


	December 31,
(dollars in thousands)	2019		2018
ASSETS
Deposits with Lake City Bank	$	1,762	$	1,283
Deposits with other depository institutions		2,104		7,613
Cash		3,866		8,896
Investments in banking subsidiary		582,674		533,442
Investments in other subsidiaries		3,276		3,992
Other assets		8,457		6,468
Total assets	$	598,273	$	552,798
LIABILITIES
Dividends payable and other liabilities	$	262	$	255
Subordinated debt		0		30,928
STOCKHOLDERS’ EQUITY		598,011		521,615
Total liabilities and stockholders’ equity	$	598,273	$	552,798

Schedule of Condensed Income Statement

CONDENSED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME


	Years Ended December 31,
(dollars in thousands)	2019		2018		2017
Dividends from Lake City Bank	$	57,842	$	27,933	$	21,822
Dividends from non-bank subsidiaries		1,302		1,010		1,030
Other income		155		171		57
Interest expense on subordinated debt		(1,720)		(1,643)		(1,349)
Miscellaneous expense		(5,321)		(6,422)		(6,491)
INCOME BEFORE INCOME TAXES AND EQUITY IN UNDISTRIBUTED INCOME OF SUBSIDIARIES		52,258		21,049		15,069
Income tax benefit		2,256		2,795		2,688
INCOME BEFORE EQUITY IN UNDISTRIBUTED INCOME OF SUBSIDIARIES		54,514		23,844		17,757
Equity in undistributed income of subsidiaries		32,533		56,567		39,573
NET INCOME	$	87,047	$	80,411	$	57,330
COMPREHENSIVE INCOME	$	105,297	$	75,131	$	59,047

Schedule of Condensed Cash Flow Statement

CONDENSED STATEMENTS OF CASH FLOWS


	Years Ended December 31,
(dollars in thousands)	2019		2018		2017
Cash flows from operating activities:
Net income	$	87,047	$	80,411	$	57,330
Adjustments to net cash from operating activities:
Equity in undistributed income of subsidiaries		(32,533)		(56,567)		(39,573)
Other changes		3,529		7,294		3,586
Net cash from operating activities		58,043		31,138		21,343
Cash flows from financing activities
Repayment of long-term debt		(30,928)		0		0
Payments related to equity incentive plans		(2,109)		(2,435)		(1,736)
Purchase of treasury stock		(515)		(463)		(495)
Sales of treasury stock		118		115		0
Dividends paid		(29,639)		(25,278)		(21,396)
Cash flows from financing activities		(63,073)		(28,061)		(23,627)
Net increase (decrease) in cash and cash equivalents		(5,030)		3,077		(2,284)
Cash and cash equivalents at beginning of the year		8,896		5,819		8,103
Cash and cash equivalents at end of the year	$	3,866	$	8,896	$	5,819

LEASES (Tables)

12 Months Ended

Dec. 31, 2019

LEASES

Schedule of Maturity Analysis of the Operating Lease Liabilities


	Operating Lease
Years ending December 31, (in thousands)	Obligation
2020	$	561
2021		581
2022		595
2023		606
2024		622
2025 and thereafter		2,873
Total undiscounted lease payments		5,838
Less imputed interest		(738)
Lease liability	$	5,100
Right-of-use asset	$	5,100

Schedule of Lease Cost


	Year Ended
	December 31,2019
Lease cost
Operating lease cost	$	498
Short-term lease cost		24
Total lease cost	$	522

Other information
Operating cash outflows from operating leases	$	498
Weighted-average remaining lease term - operating leases		9.8	years
Weighted average discount rate - operating leases		2.8	%

PENSION AND OTHER POSTRETIREMENT PLANS - Schedule of Assumptions Used in Calculating the Net Benefit Obligation (Details)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Weighted average discount rate	2.98%	4.08%	3.46%
Lump sum assumed interest rates for First 5 years	2.01%	3.33%	2.05%
Lump sum assumed interest rates for Next 15 years	3.06%	4.39%	3.61%
Lump sum assumed interest rates for All future years	3.65%	4.72%	4.27%
Net pension expense, Weighted average discount rate	4.08%	3.46%	3.86%
Expected long-term rate of return	6.50%	6.50%	6.50%
SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Weighted average discount rate	2.98%	4.08%	3.46%
Net pension expense, Weighted average discount rate	4.08%	3.46%	3.86%
Expected long-term rate of return	6.50%	6.50%	6.50%

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($)		12 Months Ended
	Jan. 01, 2019	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Summary of Significant Accounting Policies [Line Items]
Accrued Interest On Loans		$ 11,500,000	$ 11,800,000
Financing Receivable, Net		250,000
Equity Method Investments		6,700,000	7,000,000.0
Real Estate Acquired Through Foreclosure		316,000	316,000
Servicing fees		$ 1,100,000	$ 1,100,000	$ 1,000,000.0
Treasury Stock Shares		178,741	172,959
Bank Owned Life Insurance		$ 83,848,000	$ 77,106,000
Cash on hand or on deposit to meet regulatory reserve and clearing requirements		28,900,000	6,400,000
Carrying value of mortgage servicing rights		3,800,000	3,300,000
Unpaid principal balances		337,900,000	343,500,000
Cash Available for Distributions		1,600,000	2,100,000
Operating Lease, Right-of-Use Asset		5,100,000
Accounting Standards Update 2017-08
Summary of Significant Accounting Policies [Line Items]
Cumulative period adjustment made to retained earnings	$ 1,300,000
Accounting Standards Update 2016-02
Summary of Significant Accounting Policies [Line Items]
Operating Lease, Right-of-Use Asset	5,500,000
Operating Lease, Liability, Noncurrent	5,500,000
Cumulative period adjustment made to retained earnings	$ 0
Interest Rate Swap [Member]
Summary of Significant Accounting Policies [Line Items]
Notional amount		349,600,000	258,000,000.0
Fair value of interest rate swap asset		7,300,000	3,900,000
Fair value of interest rate swap liability		7,900,000	4,000,000.0
Life Insurance [Member] \| Officer [Member]
Summary of Significant Accounting Policies [Line Items]
Bank Owned Life Insurance		79,800,000	73,900,000
Deferred Compensation Plan [Member] \| Officer [Member]
Summary of Significant Accounting Policies [Line Items]
Bank Owned Life Insurance		$ 4,000,000.0	$ 3,200,000
Minimum
Summary of Significant Accounting Policies [Line Items]
Percentage of increase in allowance for credit losses		8.00%
Maximum
Summary of Significant Accounting Policies [Line Items]
Percentage of increase in allowance for credit losses		13.00%
Premises and Improvements Assets [Member] \| Minimum
Summary of Significant Accounting Policies [Line Items]
Property, Plant and Equipment, Useful Life		5 years
Premises and Improvements Assets [Member] \| Maximum
Summary of Significant Accounting Policies [Line Items]
Property, Plant and Equipment, Useful Life		40 years
Equipment and Furniture Assets [Member] \| Minimum
Summary of Significant Accounting Policies [Line Items]
Property, Plant and Equipment, Useful Life		3 years
Equipment and Furniture Assets [Member] \| Maximum
Summary of Significant Accounting Policies [Line Items]
Property, Plant and Equipment, Useful Life		7 years

CAPITAL REQUIREMENTS AND RESTRICTIONS ON RETAINED EARNINGS (Tables)

12 Months Ended

Dec. 31, 2019

CAPITAL REQUIREMENTS AND RESTRICTIONS ON RETAINED EARNINGS

Schedule of Compliance with Regulatory Capital Requirements under Banking Regulations

There have been no conditions or events since that notification that management believes have changed the Company and the Bank’s category.


													Minimum Required to
					Minimum Required				For Capital Adequacy				Be Well Capitalized
					For Capital				Purposes Plus Capital				Under Prompt Corrective
	Actual				Adequacy Purposes				Conservation Buffer				Action Regulations
(dollars in thousands)	Amount		Ratio		Amount		Ratio		Amount		Ratio		Amount		Ratio
As of December 31, 2019:
Total Capital (to Risk Weighted Assets)
Consolidated	$	631,723	14.36	%	$	351,894	8.00	%	$	461,862	N/A			N/A	N/A
Bank	$	616,386	14.04	%	$	351,227	8.00	%	$	460,985	10.50	%	$	439,034	10.00	%
Tier I Capital (to Risk Weighted Assets)
Consolidated	$	580,982	13.21	%	$	263,921	6.00	%	$	373,887	N/A			N/A	N/A
Bank	$	565,645	12.88	%	$	263,420	6.00	%	$	373,179	8.50	%	$	351,227	8.00	%
Common Equity Tier 1 (CET1)
Consolidated	$	580,982	13.21	%	$	197,941	4.50	%	$	307,908	N/A			N/A	N/A
Bank	$	565,645	12.88	%	$	197,565	4.50	%	$	307,324	7.00	%	$	285,372	6.50	%
Tier I Capital (to Average Assets)
Consolidated	$	580,982	11.67	%	$	199,099	4.00	%	$	199,099	N/A			N/A	N/A
Bank	$	565,645	11.43	%	$	197,923	4.00	%	$	197,923	4.00	%	$	247,404	5.00	%

As of December 31, 2018:
Total Capital (to Risk Weighted Assets)
Consolidated	$	601,379	14.20	%	$	338,690	8.00	%	$	418,070	N/A			N/A	N/A
Bank	$	583,206	13.80	%	$	338,098	8.00	%	$	417,340	9.875	%	$	422,623	10.00	%
Tier I Capital (to Risk Weighted Assets)
Consolidated	$	552,836	13.06	%	$	254,017	6.00	%	$	333,398	N/A			N/A	N/A
Bank	$	534,664	12.65	%	$	253,574	6.00	%	$	332,815	7.875	%	$	338,098	8.00	%
Common Equity Tier 1 (CET1)
Consolidated	$	522,836	12.35	%	$	190,513	4.50	%	$	269,893	N/A			N/A	N/A
Bank	$	534,664	12.65	%	$	190,180	4.50	%	$	269,422	6.375	%	$	274,705	6.50	%
Tier I Capital (to Average Assets)
Consolidated	$	552,836	11.44	%	$	193,305	4.00	%	$	193,305	N/A			N/A	N/A
Bank	$	534,664	11.06	%	$	193,312	4.00	%	$	193,312	4.00	%	$	241,639	5.00	%

SECURITIES - Additional information (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018
Available for sale securities
Available-for-sale Securities pledged as collateral	$ 59.3	$ 164.7

INCOME TAXES - Summary of Net Deferred Tax Asset And Liability (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Deferred tax assets:
Bad debts	$ 12,945	$ 12,478
Pension and deferred compensation liability	1,505	1,188
Nonaccrual loan interest	1,104	937
Long-term incentive plan	2,281	2,357
Lease liability	1,303	0
Other	510	506
Deferred Tax Assets, Gross	19,648	17,466
Deferred tax liabilities:
Depreciation	4,741	4,583
Loan servicing rights	1,019	877
State taxes	464	447
Intangible assets	1,270	1,280
REIT spillover dividend	1,401	1,231
Prepaid expenses	795	786
Lease Right of use	1,303	0
Other	382	475
Deferred Tax Liabilities, Gross	11,375	9,679
Valuation allowance	0	0
Net deferred tax asset	$ 8,273	$ 7,787

SUBORDINATED DEBENTURES

12 Months Ended

Dec. 31, 2019

SUBORDINATED DEBENTURES

SUBORDINATED DEBENTURES

NOTE 10 – SUBORDINATED DEBENTURES

Lakeland Statutory Trust II, a trust formed by the Company (the “Trust”), issued $30.0 million of floating rate trust preferred securities on October 1, 2003 as part of a privately placed offering of such securities. The Company issued $30.9 million of subordinated debentures to the Trust in exchange for the proceeds of the Trust. The Company held a controlling interest in the Trust, but did not have a majority of voting rights; therefore the Trust was considered a variable interest entity. The Company was not considered the primary beneficiary of this Trust; therefore, the Trust was not consolidated in the Company’s financial statements, but rather the subordinated debentures was shown as a liability. The Company’s investment in the common stock of the Trust was included in other assets and was $0 and $928,000 as of December 31, 2019 and 2018, respectively.

Subject to the Company having received prior approval of the Federal Reserve, the Company was able to redeem the subordinated debentures, in whole or in part, but in all cases in a principal amount with integral multiples of $1,000, on any interest payment date on or after October 1, 2008 at 100% of the principal amount, plus accrued and unpaid interest. The subordinated debentures were required to be redeemed no later than 2033. These securities were considered Tier I capital (with certain limitations applicable) under current regulatory guidelines and, subject to certain limitations, were also considered Tier 1 capital under Basel III.

On December 31, 2019, the Company redeemed $30.0 million of trust preferred securities of the Trust. The trust preferred securities were redeemed, along with $928,000 in common securities issued by the Trust and held by the Company, as a result of the concurrent redemption of 100% of the Company’s junior subordinated debentures due 2033 and held by the Trust, which underlie the trust preferred securities. The redemption price for the junior subordinated debentures was equal to 100% of the principal amount plus accrued interest up to, but not including, the redemption date. The proceeds from the redemption of the junior subordinated debentures were simultaneously applied to redeem all of the outstanding common securities and the outstanding trust preferred securities at a price of 100% of the aggregate liquidation amount of the trust preferred securities plus accumulated but unpaid distributions up to, but not including, the redemption date. The redemption was pursuant to the optional redemption provisions of the underlying indenture.

The floating rate of the trust preferred securities and subordinated debentures was equal to the three-month London Interbank Offered Rate (“LIBOR”) plus 3.05%, which was 5.85% at December 31, 2018.

DEPOSITS - Summary of Certain Deposits (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Non-interest bearing demand deposits	$ 983,307	$ 946,838
Savings and transaction accounts:
Savings deposits	234,508	247,903
Interest bearing demand deposits	3,150,512	3,097,227
Time deposits:
Other time deposits	281,934	273,533
Deposits of $100,000 to $250,000	291,805	268,058
Deposits of $250,000 or more	618,328	878,163
Total deposits	4,133,819	4,044,065
Demand deposits
Savings and transaction accounts:
Interest bearing demand deposits	$ 1,723,937	$ 1,429,570

COMMITMENTS, OFF-BALANCE SHEET RISKS AND CONTINGENCIES - Interest Rate Ranges On Commitments And Open Ended Revolving Lines Of Credit (Details)	Dec. 31, 2019	Dec. 31, 2018
Working capital lines of credit loans \| Minimum
Commitments Off-Balance Sheet Risks and Contingencies
Fixed Rate	0.75%	0.75%
Variable Rate	2.65%	2.65%
Working capital lines of credit loans \| Maximum
Commitments Off-Balance Sheet Risks and Contingencies
Fixed Rate	14.50%	14.50%
Variable Rate	9.25%	10.00%
Real Estate Mortgage Loans [Member] \| Minimum
Commitments Off-Balance Sheet Risks and Contingencies
Fixed Rate	3.13%	3.75%
Variable Rate	3.75%	3.75%
Real Estate Mortgage Loans [Member] \| Maximum
Commitments Off-Balance Sheet Risks and Contingencies
Fixed Rate	4.00%	6.13%
Variable Rate	4.25%	11.00%
Consumer loan open-ended revolving line
Commitments Off-Balance Sheet Risks and Contingencies
Fixed Rate	15.00%	15.00%
Consumer loan open-ended revolving line \| Minimum
Commitments Off-Balance Sheet Risks and Contingencies
Variable Rate	3.88%	3.88%
Consumer loan open-ended revolving line \| Maximum
Commitments Off-Balance Sheet Risks and Contingencies
Variable Rate	15.00%	15.00%

STOCK BASED COMPENSATION - Summary of Stock Awards Exercised (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
STOCK BASED COMPENSATION
Total intrinsic value	$ 0	$ 243	$ 44
Cash received	0	118	24
Actual tax benefit realized for tax deductions	$ 0	$ 0	$ 0

REVENUE RECOGNITION (Details) - USD ($) $ in Thousands	12 Months Ended
REVENUE RECOGNITION (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
REVENUE RECOGNITION
Wealth advisory fees	$ 6,835	$ 6,344	$ 5,481
Investment brokerage fees	1,687	1,458	1,273
Service charges on deposit accounts
Service charges on commercial deposit accounts	10,082	10,234	8,230
Service charges on retail deposit accounts	880	879	905
Overdrafts, net	3,585	3,581	3,452
Other	1,170	1,137	1,109
Loan and service fees
Debit card interchange fees	6,344	5,883	4,663
Loan fees	2,544	2,423	2,231
Other	1,023	985	1,006
Merchant card fee income	2,641	2,461	2,279
Bank owned life insurance income	1,890	1,244	1,768
Mortgage banking income	1,626	1,150	982
Net securities gains/(losses)	142	(50)	32
Other income	4,548	2,573	2,629
Total noninterest income	$ 44,997	$ 40,302	$ 36,040

OFFSETTING ASSETS AND LIABILITIES (Tables)

12 Months Ended

Dec. 31, 2019

OFFSETTING ASSETS AND LIABILITIES.

Schedule of Offsetting Assets And Liability

The following tables summarize gross and net information about financial instruments and derivative instruments that are offset in the statement of financial position or that are subject to an enforceable master netting arrangement at December 31, 2019 and 2018.


	December 31, 2019
			Gross
	Gross		Amounts		Net Amounts		Gross Amounts Not
	Amounts of		Offset in the		presented in		Offset in the Statement
	Recognized		Statement of		the Statement		of Financial Position
	Assets/		Financial		of Financial		Financial		Cash Collateral		Net
(dollars in thousands)	Liabilities		Position		Position		Instruments		Position		Amount
Assets
Interest Rate Swap Derivatives	$	7,263	$	0	$	7,263	$	0	$	0	$	7,263
Total Assets	$	7,263	$	0	$	7,263	$	0	$	0	$	7,263
Liabilities
Interest Rate Swap Derivatives	$	7,860	$	0	$	7,860	$	0	$	(7,560)	$	300
Repurchase Agreements		0		0		0		0		0		0
Total Liabilities	$	7,860	$	0	$	7,860	$	0	$	(7,560)	$	300


	December 31, 2018
			Gross
	Gross		Amounts		Net Amounts		Gross Amounts Not
	Amounts of		Offset in the		presented in		Offset in the Statement
	Recognized		Statement of		the Statement		of Financial Position
	Assets/		Financial		of Financial		Financial		Cash Collateral		Net
(dollars in thousands)	Liabilities		Position		Position		Instruments		Position		Amount
Assets
Interest Rate Swap Derivatives	$	3,869	$	0	$	3,869	$	0	$	(760)	$	3,109
Total Assets	$	3,869	$	0	$	3,869	$	0	$	(760)	$	3,109
Liabilities
Interest Rate Swap Derivatives	$	4,025	$	0	$	4,025	$	0	$	(560)	$	3,465
Repurchase Agreements		75,555		0		75,555		(75,555)		0		0
Total Liabilities	$	79,580	$	0	$	79,580	$	(75,555)	$	(560)	$	3,465

BORROWINGS - Short-Term Borrowings - Parenthetical (Details)	12 Months Ended
	Dec. 31, 2019
Federal Home Loan Bank of Indianapolis Advance, 1.61%, Due January 7, 2020
Debt Instrument [Line Items]
Federal Home Loan Bank, Advances, Branch of FHLB Bank, Interest Rate	1.61%
Federal Home Loan Bank Advances Branch Of Fhlb Bank Due Dates	Jan. 07, 2019
Federal Home Loan Bank of Indianapolis Notes, 2.52%, Due January 7, 2019
Debt Instrument [Line Items]
Federal Home Loan Bank, Advances, Branch of FHLB Bank, Interest Rate	2.52%
Federal Home Loan Bank Advances Branch Of Fhlb Bank Due Dates	Jun. 27, 2018

PENSION AND OTHER POSTRETIREMENT PLANS - Net pension expense and other amounts (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Net pension expense:
Net (gain)/loss	$ 409	$ (269)	$ (97)
Pension Benefits
Net pension expense:
Service cost	0	0	0
Interest cost	87	93	104
Expected return on plan assets	(137)	(138)	(143)
Recognized net actuarial loss	132	193	185
Settlement cost	0	224	0
Net pension expense	82	372	146
Net (gain)/loss	353	(296)	(36)
Amortization of net loss	(132)	(193)	(185)
Total recognized in other comprehensive income (loss)	221	(489)	(221)
Total recognized in net pension expense and other comprehensive income (loss)	303	(117)	(75)
SERP Benefits
Net pension expense:
Service cost	0	0	0
Interest cost	37	34	40
Expected return on plan assets	(55)	(61)	(63)
Recognized net actuarial loss	73	73	80
Settlement cost	0	0	0
Net pension expense	55	46	57
Net (gain)/loss	56	27	(61)
Amortization of net loss	(73)	(73)	(80)
Total recognized in other comprehensive income (loss)	(17)	(46)	(141)
Total recognized in net pension expense and other comprehensive income (loss)	$ 38	$ 0	$ (84)

FAIR VALUE

12 Months Ended

Dec. 31, 2019

FAIR VALUE

FAIR VALUE

NOTE 5 – FAIR VALUE

Fair value is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of inputs that may be used to measure fair values:

Level 1 Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2 Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3 Significant unobservable inputs that reflect a company’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

The Company used the following methods and significant assumptions to estimate the fair value of each type of financial instrument:

Securities: Securities available-for-sale are valued primarily by a third party pricing service. The fair values of securities available-for-sale are determined on a recurring basis by obtaining quoted prices on nationally recognized securities exchanges (Level 1 inputs) or pricing models which utilize significant observable inputs such as matrix pricing. This is a mathematical technique widely used in the industry to value debt securities without relying exclusively on quoted prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted securities (Level 2 inputs). These models utilize the market approach with standard inputs that include, but are not limited to benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data. For certain municipal securities that are not rated and observable inputs about the specific issuer are not available, fair values are estimated using observable data from other municipal securities presumed to be similar or other market data on other non-rated municipal securities (Level 3 inputs).

The Company’s Finance Department, which is responsible for all accounting and SEC compliance, and the Company’s Treasury Department, which is responsible for investment portfolio management and asset/liability modeling, are the two areas that determine the Company’s valuation policies and procedures. Both of these areas report directly to the Executive Vice President and Chief Financial Officer of the Company. For assets or liabilities that may be considered for Level 3 fair value measurement on a recurring basis, these two departments and the Executive Vice President and Chief Financial Officer determine the appropriate level of the assets or liabilities under consideration. If there are assets or liabilities that are determined to be Level 3 by this group, the Risk Management Committee of the Company and the Audit Committee of the board of directors (the “Board”) are made aware of such assets at their next scheduled meeting.

Securities pricing is obtained on securities from a third party pricing service and all security prices are tested annually against prices from another third party provider and reviewed with a market value price tolerance variance that varies by sector: municipal securities +/- 5%, government mbs/cmo +/- 3% and U.S. treasuries +/-1%. If any securities fall outside the tolerance threshold and have a variance of $100,000 or more, a determination of materiality is made for the amount over the threshold. Any security that would have a material threshold difference would be further investigated to determine why the variance exists and if any action is needed concerning the security pricing for that individual security. Changes in market value are reviewed monthly in aggregate by security type and any material differences are reviewed to determine why they exist. At least annually, the pricing methodology of the pricing service is received and reviewed to support the fair value levels used by the Company. A detailed pricing evaluation is requested and reviewed on any security determined to be fair valued using unobservable inputs by the pricing service.

Mortgage banking derivative: The fair values of mortgage banking derivatives are based on observable market data as of the measurement date (Level 2).

NOTE 5 – FAIR VALUE (continued)

Interest rate swap derivatives: Our derivatives are traded in an over-the-counter market where quoted market prices are not always available. Therefore, the fair values of derivatives are determined using quantitative models that utilize multiple market inputs. The inputs will vary based on the type of derivative, but could include interest rates, prices and indices to generate continuous yield or pricing curves, prepayment rates, and volatility factors to value the position. The majority of market inputs are actively quoted and can be validated through external sources, including brokers, market transactions and third-party pricing services. The fair value of interest rate swap derivatives is determined by pricing or valuation models using observable market data as of the measurement date (Level 2).

Impaired loans: Impaired loans with specific allocations of the allowance for loan losses are generally based on the fair value of the underlying collateral if repayment is expected solely from the collateral. Fair value is determined using several methods. Generally, the fair value of real estate is based on appraisals by qualified third party appraisers. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are usually significant and result in a Level 3 classification of the inputs for determining fair value. In addition, the Company’s management routinely applies internal discount factors to the value of appraisals used in the fair value evaluation of impaired loans. The deductions to the appraisals take into account changing business factors and market conditions, as well as value impairment in cases where the appraisal date predates a likely change in market conditions. Commercial real estate is generally discounted from its appraised value by 0-50% with the higher discounts applied to real estate that is determined to have a thin trading market or to be specialized collateral. In addition to real estate, the Company’s management evaluates other types of collateral as follows: (a) raw and finished inventory is discounted from its cost or book value by 35-65%, depending on the marketability of the goods (b) finished goods are generally discounted by 30-60%, depending on the ease of marketability, cost of transportation or scope of use of the finished good (c) work in process inventory is typically discounted by 50-100%, depending on the length of manufacturing time, types of components used in the completion process, and the breadth of the user base (d) equipment is valued at a percentage of depreciated book value or recent appraised value, if available, and is typically discounted at 30-70% after various considerations including age and condition of the equipment, marketability, breadth of use, and whether the equipment includes unique components or add-ons; and (e) marketable securities are discounted by 10-30%, depending on the type of investment, age of valuation report and general market conditions. This methodology is based on a market approach and typically results in a Level 3 classification of the inputs for determining fair value.

Mortgage servicing rights: As of December 31, 2019, the fair value of the Company’s Level 3 servicing assets for residential mortgage loans (“MSRs”) was $4.4 million, none of which are currently impaired and therefore are carried at amortized cost. These residential mortgage loans have a weighted average interest rate of 3.9%, a weighted average maturity of 20 years and are secured by homes generally within the Company’s market area of Northern Indiana and Indianapolis. A valuation model is used to estimate fair value by stratifying the portfolios on the basis of certain risk characteristics, including loan type and interest rate. Impairment is estimated based on an income approach. The inputs used include estimates of prepayment speeds, discount rate, cost to service, escrow account earnings, contractual servicing fee income, ancillary income, late fees, and float income. The most significant assumption used to value MSRs is prepayment rate. Prepayment rates are estimated based on published industry consensus prepayment rates. The most significant unobservable assumption is the discount rate. At December 31, 2019, the constant prepayment speed (“PSA”) used was 118 and discount rate used was 9.4%. At December 31, 2018, the PSA used was 81 and the discount rate used was 9.4%.

At December 31, 2019, the sensitivity of the current fair value of MSRs to an immediate 10% and 20% adverse change in the PSA and discount rate was ($124,000) and ($242,000), respectively for the PSA, and was ($170,000) and ($329,000), respectively for the discount rate. These sensitivities are hypothetical and should not be relied upon. As the figures indicate, changes in value based on a 10% and 20% variation in assumptions generally cannot be extrapolated because the relationship of the change in assumption to the change in value may not be linear. Also, in this example, the effect of a variation in a particular assumption on the value of the MSR is calculated without changing any other assumption; however, in reality, changes in one factor may result in changes in another (for example, increases in market interest rates may result in lower prepayments), which might magnify or counteract the sensitivities.

NOTE 5 – FAIR VALUE (continued)

Other real estate owned: Nonrecurring adjustments to certain commercial and residential real estate properties classified as other real estate owned are measured at the lower of carrying amount or fair value less costs to sell. Fair values are generally based on third party appraisals of the property and are reviewed by the Company’s internal appraisal officer. Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable properties used to determine value. Such adjustments are usually significant and result in a Level 3 classification. In addition, the Company’s management may apply discount factors to the appraisals to take into account changing business factors and market conditions, as well as value impairment in cases where the appraisal date predates a likely change in market conditions. In cases where the carrying amount exceeds the fair value, less costs to sell, an impairment loss is recognized.

Real estate mortgage loans held-for-sale: Real estate mortgage loans held for sale are carried at the lower of cost or fair value, as determined by outstanding commitments, from third party investors, and result in a Level 2 classification.

The table below presents the balances of assets and liabilities measured at fair value on a recurring basis:


	December 31, 2019
	Fair Value Measurements Using						Assets
(dollars in thousands)	Level 1		Level 2		Level 3		at Fair Value
Assets:
Mortgage-backed securities: residential	$	0	$	288,181	$	0	$	288,181
Mortgage-backed securities: commercial		0		36,972		0		36,972
State and municipal securities		0		282,935		145		283,080
Total Securities		0		608,088		145		608,233
Mortgage banking derivative		0		198		0		198
Interest rate swap derivative		0		7,263		0		7,263
Total assets	$	0	$	615,549	$	145	$	615,694

Liabilities:
Mortgage banking derivative		0		14		0		14
Interest rate swap derivative		0		7,860		0		7,860
Total liabilities	$	0	$	7,874	$	0	$	7,874


	December 31, 2018
	Fair Value Measurements Using						Assets
(dollars in thousands)	Level 1		Level 2		Level 3		at Fair Value
Assets:
U.S. Treasury securities	$	987	$	0	$	0	$	987
U.S. government sponsored agency securities		0		4,350		0		4,350
Mortgage-backed securities: residential		0		325,412		0		325,412
Mortgage-backed securities: commercial		0		38,141		0		38,141
State and municipal securities		0		216,509		150		216,659
Total Securities		987		584,412		150		585,549
Mortgage banking derivative		0		95		0		95
Interest rate swap derivative		0		3,869		0		3,869
Total assets	$	987	$	588,376	$	150	$	589,513

Liabilities:
Mortgage banking derivative		0		23		0		23
Interest rate swap derivative		0		4,025		0		4,025
Total liabilities	$	0	$	4,048	$	0	$	4,048

There were no transfers between Level 1 and Level 2 during 2019 and 2018.

NOTE 5 – FAIR VALUE (continued)

The fair value of Level 3 available-for-sale securities was immaterial to warrant additional recurring fair value disclosures as of December 31, 2019 and 2018.

The tables below present the amount of assets measured at fair value on a nonrecurring basis:


	December 31, 2019
	Fair Value Measurements Using						Assets
(dollars in thousands)	Level 1		Level 2		Level 3		at Fair Value
Assets
Impaired loans:
Commercial and industrial loans:
Working capital lines of credit loans	$	0	$	0	$	3,126	$	3,126
Non-working capital loans		0		0		6,374		6,374
Commercial real estate and multi-family residential loans:
Construction and land development loans		0		0		43		43
Owner occupied loans		0		0		1,449		1,449
Agri-business and agricultural loans:
Loans secured by farmland		0		0		57		57
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		0		0		474		474
Open end and junior lien loans		0		0		587		587
Other consumer loans		0		0		11		11
Total impaired loans	$	0	$	0	$	12,121	$	12,121
Other real estate owned		0		0		0		0
Total assets	$	0	$	0	$	12,121	$	12,121


	December 31, 2018
	Fair Value Measurements Using						Assets
(dollars in thousands)	Level 1		Level 2		Level 3		at Fair Value
Assets
Impaired loans:
Commercial and industrial loans:
Working capital lines of credit loans	$	0	$	0	$	4,092	$	4,092
Non-working capital loans		0		0		4,967		4,967
Commercial real estate and multi-family residential loans:
Construction and land development loans		0		0		148		148
Owner occupied loans		0		0		1,669		1,669
Agri-business and agricultural loans:
Loans secured by farmland		0		0		77		77
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		0		0		553		553
Total impaired loans	$	0	$	0	$	11,506	$	11,506
Other real estate owned		0		0		316		316
Total assets	$	0	$	0	$	11,822	$	11,822

NOTE 5 – FAIR VALUE (continued)

The following table presents the valuation methodology and unobservable inputs for Level 3 assets measured at fair value on a non-recurring basis at December 31, 2019:


(dollars in thousands)	Fair Value		Valuation Methodology	Unobservable Inputs	Average		Range of Inputs
Impaired loans:
Commercial and industrial	$	9,500	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	53	%	1%-100%


Impaired loans:
Commercial real estate		1,492	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	27	%	7%-61%



Impaired loans:
Agribusiness and agricultural		57	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	61	%


Impaired loans:
Consumer 1-4 family mortgage		1,061	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	14	%	5%-100%


Impaired loans:
Other consumer		11	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	36	%

NOTE 5 – FAIR VALUE (continued)

The following table presents the valuation methodology and unobservable inputs for Level 3 assets measured at fair value on a non-recurring basis at December 31, 2018:


(dollars in thousands)	Fair Value		Valuation Methodology	Unobservable Inputs	Average		Range of Inputs
Impaired loans:
Commercial and industrial	$	9,059	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	48	%	4%-100%


Impaired loans:
Commercial real estate		1,817	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	34	%	6%-53%



Impaired loans:
Agribusiness and agricultural		77	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	49	%


Impaired loans:
Consumer 1-4 family mortgage		553	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	23	%	0%-64%



Other real estate owned		316	Collateral based measurements	Discount to reflect current market conditions	0	%

NOTE 5 – FAIR VALUE (continued)

Impaired loans, which are measured for impairment using the fair value of the collateral for collateral dependent loans, had a gross carrying amount of $22.2 million, with a valuation allowance of $10.1 million at December 31, 2019, resulting in an increase in provision for loan losses of $600,000 for the year ended December 31, 2019. At December 31, 2018, impaired loans had a gross carrying amount of $21.0 million, with a valuation allowance of $9.5 million, resulting in an increase in provision for loan losses of $7.1 million for the year ended December 31, 2018.

At December 31, 2019 and 2018, other real estate owned had a net carrying amount of $316,000.

The following table contains the estimated fair values and the related carrying values of the Company’s financial instruments at December 31, 2019. Items which are not financial instruments are not included.

December 31, 2019

Carrying

Estimated Fair Value

(dollars in thousands)

Value

Level 1

Level 2

Level 3

Total

Financial Assets:

Cash and cash equivalents

99,381

96,603

2,778

99,381

Securities available-for-sale

608,233

608,088

145

608,233

Real estate mortgages held-for-sale

4,527

4,614

Loans, net

4,015,176

3,979,006

Federal Reserve and Federal Home Loan Bank Stock

13,772

N/A

Accrued interest receivable

15,391

3,729

11,662

15,391

Financial Liabilities:

Certificates of deposit

(1,192,067)

(1,202,060)

All other deposits

(2,941,752)

Federal Home Loan Bank advances

(170,000)

(169,998)

Standby letters of credit

(915)

Accrued interest payable

(11,604)

(102)

(11,502)

(11,604)

The following table contains the estimated fair values and the related carrying values of the Company’s financial instruments at December 31, 2018. Items which are not financial instruments are not included.


	December 31, 2018
	Carrying		Estimated Fair Value
(dollars in thousands)	Value		Level 1		Level 2		Level 3		Total
Financial Assets:
Cash and cash equivalents	$	216,922	$	214,452	$	2,470	$	0	$	216,922
Securities available-for-sale		585,549		987		584,412		150		585,549
Real estate mortgages held-for-sale		2,293		0		2,314		0		2,314
Loans, net		3,866,292		0		0		3,786,175		3,786,175
Federal Reserve and Federal Home Loan Bank Stock		13,772		N/A		N/A		N/A		N/A
Accrued interest receivable		15,518		3		3,569		11,946		15,518
Financial Liabilities:
Certificates of deposit		(1,419,754)		0		(1,424,553)		0		(1,424,553)
All other deposits		(2,624,311)		(2,624,311)		0		0		(2,624,311)
Securities sold under agreements to repurchase		(75,555)		0		(75,555)		0		(75,555)
Federal Home Loan Bank advances		(170,000)		0		(169,996)		0		(169,996)
Subordinated debentures		(30,928)		0		0		(31,195)		(31,195)
Standby letters of credit		(978)		0		0		(978)		(978)
Accrued interest payable		(10,404)		(110)		(10,289)		(5)		(10,404)

BORROWINGS (Securities Sold with Agreements to Repurchase) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Short-term Debt [Abstract]
Outstanding at year end	$ 0	$ 75,555	$ 70,652
Approximate average interest rate at year end	0.00%	0.74%	0.46%
Highest amount outstanding as of any month end during the year	$ 72,814	$ 106,239	$ 77,886
Approximate average outstanding during the year	$ 15,104	$ 86,874	$ 63,379
Approximate average interest rate during the year	0.86%	0.58%	0.39%

LAND, PREMISES AND EQUIPMENT, NET - Additional Information (Details) - USD ($)	Dec. 31, 2019	Dec. 31, 2018
Other assets
Disposal Group, Including Discontinued Operation, Property, Plant and Equipment	$ 100,000	$ 100,000

INCOME TAXES

12 Months Ended

Dec. 31, 2019

INCOME TAXES

INCOME TAXES

NOTE 13 – INCOME TAXES

On December 22, 2017, the Tax Cuts and Jobs Act (“Act”) was enacted into law and, among other items, reduces the corporate income tax rate from 35% to 21%, effective January 1, 2018. The enactment of this law resulted in a lower federal income tax rate resulting in a reduction of the benefit provided by the Company’s existing deferred tax assets.

In accordance with ASC Topic 740, “Income Taxes”, the Company revalued its net deferred tax asset based on facts and circumstances available for the reporting period ending December 31, 2017 in which the Act was enacted and through the time the Company issues its financial statements for that reporting period. As a result of this revaluation, the Company recorded an income tax provision of $4.1 million for the period ending December 31, 2017. In addition, through the preparation the Company’s 2017 corporate tax return and the completion of cost segregation studies on new construction projects, the Company recognized a tax benefit of $408,000 for the year ending December 31, 2018.

Income tax expense for the years ended December 31, 2019, 2018 and 2017 consisted of the following:


(dollars in thousands)	2019		2018		2017
Current federal	$	19,430	$	16,871	$	27,064
Deferred federal		(408)		707		(199)
Revalue deferred taxes due to tax reform		0		(408)		4,137
Current state		1,394		1,462		1,559
Deferred state		(78)		(99)		(257)
Total income tax expense	$	20,338	$	18,533	$	32,304

The differences between financial statement tax expense and amounts computed by applying the statutory federal income tax rate of 21% for 2019 and 2018 and 35% for 2017 to income before income taxes were as follows:


(dollars in thousands)	2019		2018		2017
Income taxes at statutory federal rate of 21% (2019 and 2018) and 35% (2017)	$	22,551	$	20,778	$	31,372
Increase (decrease) in taxes resulting from:
Tax exempt income		(1,682)		(1,434)		(2,015)
Nondeductible expense		194		165		193
State income tax, net of federal tax effect		1,040		1,077		846
Captive insurance premium income		(310)		(292)		(378)
Tax credits		(548)		(412)		(326)
Bank owned life insurance		(573)		(303)		(619)
Long - term incentive plan		(421)		(641)		(854)
Revaluation deferred tax asset at 21% rate		0		(408)		4,137
Other		87		3		(52)
Total income tax expense	$	20,338	$	18,533	$	32,304

NOTE 13 – INCOME TAXES (continued)

The net deferred tax asset recorded in the consolidated balance sheets at December 31, 2019 and 2018 consisted of the following:


(dollars in thousands)	2019		2018
Deferred tax assets:
Bad debts	$	12,945	$	12,478
Pension and deferred compensation liability		1,505		1,188
Nonaccrual loan interest		1,104		937
Long-term incentive plan		2,281		2,357
Lease liability		1,303		0
Other		510		506
		19,648		17,466
Deferred tax liabilities:
Depreciation		4,741		4,583
Loan servicing rights		1,019		877
State taxes		464		447
Intangible assets		1,270		1,280
REIT spillover dividend		1,401		1,231
Prepaid expenses		795		786
Lease Right of Use		1,303		0
Other		382		475
		11,375		9,679
Valuation allowance		0		0
Net deferred tax asset	$	8,273	$	7,787

In addition to the net deferred tax assets included above, the deferred income tax asset (liability) allocated to the unrealized net gain (loss) on securities available-for-sale included in equity was ($3.6) million and $1.3 million for 2019 and 2018, respectively. The deferred income tax asset allocated to the pension plan and SERP included in equity was $512,000 and $462,000 for 2019 and 2018, respectively.

The Company evaluated its deferred tax asset at year end 2019 and has concluded that it is more likely than not that it will be realized. The Company expects to have taxable income in the future such that the deferred tax asset will be realized. Therefore, no valuation allowance is required.

Unrecognized Tax Benefits

The Company did not have any unrecognized tax benefits at December 31, 2019 or 2018. The Company does not expect the total amount of unrecognized tax benefits to significantly increase or decrease in the next twelve months.

No interest or penalties were recorded in the income statement and no amount was accrued for interest and penalties for the period ending December 31, 2019, 2018 and 2017. Should the accrual of any interest or penalties relative to unrecognized tax benefits be necessary, it is the Company’s policy to record such accruals in its income taxes accounts.

The Company and its subsidiaries file a consolidated U.S. federal tax return and a combined unitary return in the States of Indiana and Michigan. These returns are subject to examinations by authorities for all years after 2015.

PENSION AND OTHER POSTRETIREMENT PLANS - Components of net periodic benefit cost (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Pension Benefits
Change in benefit obligation:
Beginning benefit obligation	$ 2,118	$ 2,862
Interest cost	87	93	$ 104
Actuarial (gain) loss	631	(325)
Benefits paid	(121)	(512)
Ending benefit obligation	2,715	2,118	2,862
Change in plan assets (primarily equity and fixed income investments and money market funds), at fair value:
Beginning plan assets	2,151	2,356
Actual return	415	(61)
Employer contribution	27	368
Benefits paid	(121)	(512)
Ending plan assets	2,472	2,151	2,356
Funded status at end of year	(243)	33
SERP Benefits
Change in benefit obligation:
Beginning benefit obligation	924	1,086
Interest cost	37	34	40
Actuarial (gain) loss	164	(62)
Benefits paid	(134)	(134)
Ending benefit obligation	991	924	1,086
Change in plan assets (primarily equity and fixed income investments and money market funds), at fair value:
Beginning plan assets	885	1,047
Actual return	163	(28)
Employer contribution	0	0
Benefits paid	(134)	(134)
Ending plan assets	914	885	$ 1,047
Funded status at end of year	$ (77)	$ (39)

LAND, PREMISES AND EQUIPMENT, NET

12 Months Ended

Dec. 31, 2019

LAND, PREMISES AND EQUIPMENT, NET

LAND, PREMISES AND EQUIPMENT, NET

NOTE 6 – LAND, PREMISES AND EQUIPMENT, NET

Land, premises and equipment and related accumulated depreciation were as follows at December 31, 2019 and 2018:


(dollars in thousands)	2019		2018
Land	$	12,511	$	12,302
Premises and improvements		53,213		49,064
Equipment and furniture		38,691		36,111
Total cost		104,415		97,477
Less accumulated depreciation		44,261		39,380
Land, premises and equipment, net	$	60,154	$	58,097

The Company had land, premises and equipment of $100,000 held for sale and included in other assets as of December 31, 2019 and 2018.

FAIR VALUE - Valuation Methodology and Unobservable Inputs for Level 3 Assets (Details) - Fair Value, Measurements, Nonrecurring $ in Thousands	12 Months Ended
	Dec. 31, 2019 USD ($) item	Dec. 31, 2018 USD ($) item
Valuation Methodology and Unobservable Inputs For Level 3 Assets Measured At Fair Value [Line Items]
Impaired loans \| $	$ 12,121	$ 11,506
Commercial and Industrial Loans
Valuation Methodology and Unobservable Inputs For Level 3 Assets Measured At Fair Value [Line Items]
Impaired loans \| $	$ 9,500	$ 9,059
Valuation Methodology	Collateral based measurements	Collateral based measurements
Unobservable Inputs	Discount to reflect current market conditions and ultimate collectability	Discount to reflect current market conditions
Commercial and Industrial Loans \| Minimum
Valuation Methodology and Unobservable Inputs For Level 3 Assets Measured At Fair Value [Line Items]
Range of Inputs (Average) (in hundredths)	1	4
Commercial and Industrial Loans \| Maximum
Valuation Methodology and Unobservable Inputs For Level 3 Assets Measured At Fair Value [Line Items]
Range of Inputs (Average) (in hundredths)	100	100
Commercial and Industrial Loans \| Weighted Average
Valuation Methodology and Unobservable Inputs For Level 3 Assets Measured At Fair Value [Line Items]
Range of Inputs (Average) (in hundredths)	53	48
Commercial Real Estate and Multi-family Residential Loans
Valuation Methodology and Unobservable Inputs For Level 3 Assets Measured At Fair Value [Line Items]
Impaired loans \| $	$ 1,492	$ 1,817
Valuation Methodology	Collateral based measurements	Collateral based measurements
Unobservable Inputs	Discount to reflect current market conditions and ultimate collectability	Discount to reflect current market conditions
Commercial Real Estate and Multi-family Residential Loans \| Minimum
Valuation Methodology and Unobservable Inputs For Level 3 Assets Measured At Fair Value [Line Items]
Range of Inputs (Average) (in hundredths)	7	6
Commercial Real Estate and Multi-family Residential Loans \| Maximum
Valuation Methodology and Unobservable Inputs For Level 3 Assets Measured At Fair Value [Line Items]
Range of Inputs (Average) (in hundredths)	61	53
Commercial Real Estate and Multi-family Residential Loans \| Weighted Average
Valuation Methodology and Unobservable Inputs For Level 3 Assets Measured At Fair Value [Line Items]
Range of Inputs (Average) (in hundredths)	27	34
Consumer 1-4 Family Mortgage Loans
Valuation Methodology and Unobservable Inputs For Level 3 Assets Measured At Fair Value [Line Items]
Impaired loans \| $	$ 1,061	$ 553
Valuation Methodology	Collateral based measurements	Collateral based measurements
Unobservable Inputs	Discount to reflect current market conditions and ultimate collectability	Discount to reflect current market conditions and ultimate collectability
Consumer 1-4 Family Mortgage Loans \| Minimum
Valuation Methodology and Unobservable Inputs For Level 3 Assets Measured At Fair Value [Line Items]
Range of Inputs (Average) (in hundredths)	5	0
Consumer 1-4 Family Mortgage Loans \| Maximum
Valuation Methodology and Unobservable Inputs For Level 3 Assets Measured At Fair Value [Line Items]
Range of Inputs (Average) (in hundredths)	100	64
Consumer 1-4 Family Mortgage Loans \| Weighted Average
Valuation Methodology and Unobservable Inputs For Level 3 Assets Measured At Fair Value [Line Items]
Range of Inputs (Average) (in hundredths)	14	23
Other Real Estate Owned
Valuation Methodology and Unobservable Inputs For Level 3 Assets Measured At Fair Value [Line Items]
Impaired loans \| $		$ 316
Valuation Methodology		Collateral based measurements
Unobservable Inputs		Discount to reflect current market conditions
Other Real Estate Owned \| Weighted Average
Valuation Methodology and Unobservable Inputs For Level 3 Assets Measured At Fair Value [Line Items]
Range of Inputs (Average) (in hundredths)		0
Other consumer loans
Valuation Methodology and Unobservable Inputs For Level 3 Assets Measured At Fair Value [Line Items]
Impaired loans \| $	$ 11
Valuation Methodology	Collateral based measurements
Unobservable Inputs	Discount to reflect current market conditions and ultimate collectability
Other consumer loans \| Weighted Average
Valuation Methodology and Unobservable Inputs For Level 3 Assets Measured At Fair Value [Line Items]
Range of Inputs (Average) (in hundredths)	36
Agribusiness and Agricultural
Valuation Methodology and Unobservable Inputs For Level 3 Assets Measured At Fair Value [Line Items]
Impaired loans \| $	$ 57	$ 77
Valuation Methodology	Collateral based measurements	Collateral based measurements
Unobservable Inputs	Discount to reflect current market conditions and ultimate collectability	Discount to reflect current market conditions and ultimate collectability
Agribusiness and Agricultural \| Weighted Average
Valuation Methodology and Unobservable Inputs For Level 3 Assets Measured At Fair Value [Line Items]
Range of Inputs (Average) (in hundredths)	61	49

STOCK BASED COMPENSATION - Additional Information (Details) - USD ($)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Apr. 12, 2017	Apr. 09, 2013	Apr. 08, 2008
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-Based Compensation, Shares Authorized Under Equity Incentive Plans						1,125,000
Employee Stock Ownership Plan (ESOP), Compensation Expense	$ 4,200,000	$ 5,600,000	$ 5,700,000
Employee Service Share-based Compensation, Tax Benefit from Compensation Expense	$ 1,100,000	$ 1,500,000	$ 2,200,000
Number of stock option grants	0	0	0
Modifications of stock option	0	0	0
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Stock Options	$ 0
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant	684,926
2013 Plan Member
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant					435,867
2017 Plan Member
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-Based Compensation, Shares Authorized Under Equity Incentive Plans				1,000,000
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Stock Options	$ 135,000
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Period for Recognition	1 year 3 days
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Intrinsic Value	$ 737,000	$ 726,000	$ 1,200,000
Vested	15,600
Performance Shares [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Stock Options	$ 3,400,000
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Period for Recognition	1 year 6 months 18 days
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Intrinsic Value	$ 5,700,000	$ 6,600,000	$ 5,100,000
Vested	126,672	137,472	112,055

REVENUE RECOGNITION (Tables)

12 Months Ended

Dec. 31, 2019

REVENUE RECOGNITION

Schedule of Revenue from External Customers by Products and Services

All of the Company’s revenue from contracts with customers in the scope of ASC 606 is recognized within noninterest income. The following table presents the Company’s sources of noninterest income for the years ended 2019, 2018 and 2017. Items outside of scope of ASC 606 are noted as such.


	Year Ended December 31,
	2019		2018		2017 ⁽²⁾
NONINTEREST INCOME
Wealth advisory fees	$	6,835	$	6,344	$	5,481
Investment brokerage fees		1,687		1,458		1,273
Service charges on deposit accounts
Service charges on commercial deposit acounts		10,082		10,234		8,230
Service charges on retail deposit acounts		880		879		905
Overdrafts, net		3,585		3,581		3,452
Other		1,170		1,137		1,109
Loan and service fees
Debit card interchange fees		6,344		5,883		4,663
Loan fees ⁽¹⁾		2,544		2,423		2,231
Other		1,023		985		1,006
Merchant card fee income		2,641		2,461		2,279
Bank owned life insurance income ⁽¹⁾		1,890		1,244		1,768
Mortgage banking income ⁽¹⁾		1,626		1,150		982
Net securities gains (losses) ⁽¹⁾		142		(50)		32
Other income		4,548		2,573		2,629
Total noninterest income	$	44,997	$	40,302	$	36,040

(1)	Not within scope of ASC 606

(2)

The Company elected the modified retrospective approach of adoption; therefore, prior period balances are presented under legacy GAAP and may not be comparable to current year presentation. As a result of this new standard, the only revenue streams with changes in reporting in the current periods compared to the prior year comparable periods are loan and service fees and other income.

LAND, PREMISES AND EQUIPMENT, NET (Tables)

12 Months Ended

Dec. 31, 2019

LAND, PREMISES AND EQUIPMENT, NET

Schedule of Land, Premises And Equipment

Land, premises and equipment and related accumulated depreciation were as follows at December 31, 2019 and 2018:


(dollars in thousands)	2019		2018
Land	$	12,511	$	12,302
Premises and improvements		53,213		49,064
Equipment and furniture		38,691		36,111
Total cost		104,415		97,477
Less accumulated depreciation		44,261		39,380
Land, premises and equipment, net	$	60,154	$	58,097

INCOME TAXES - Computation of Differences Between Financial Statement Tax Expense And Amounts (Details) - USD ($)	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
INCOME TAXES
Income taxes at statutory federal rate of 21% (2019 and 2018) and 35% (2017)									$ 22,551,000	$ 20,778,000	$ 31,372,000
Increase (decrease) in taxes resulting from:
Tax exempt income									(1,682,000)	(1,434,000)	(2,015,000)
Nondeductible expense									194,000	165,000	193,000
State income tax, net of federal tax effect									1,040,000	1,077,000	846,000
Captive insurance premium income									(310,000)	(292,000)	(378,000)
Tax credits									(548,000)	(412,000)	(326,000)
Bank owned life insurance									(573,000)	(303,000)	(619,000)
Long - term incentive plan									(421,000)	(641,000)	(854,000)
Revaluation deferred tax asset at 21% rate									0	(408,000)	4,137,000
Other									87,000	3,000	(52,000)
Total income tax expense	$ 5,431,000	$ 5,119,000	$ 5,409,000	$ 4,379,000	$ 5,480,000	$ 4,679,000	$ 5,110,000	$ 3,264,000	$ 20,338,000	$ 18,533,000	$ 32,304,000

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	12 Months Ended
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	Dec. 31, 2019
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature of Operations and Principles of Consolidation	Nature of Operations and Principles of Consolidation: The consolidated financial statements include Lakeland Financial Corporation (the “Holding Company”) and its wholly-owned subsidiaries, Lake City Bank (the “Bank”) and LCB Risk Management, Inc., together referred to as (the “Company”). On December 18, 2006, LCB Investments II, Inc. was formed as a wholly owned subsidiary of the Bank incorporated in Nevada to manage a portion of the Bank’s investment portfolio beginning in 2007. On December 21, 2006, LCB Funding, Inc., a real estate investment trust incorporated in Maryland, was formed as a wholly owned subsidiary of LCB Investments II, Inc. On December 28, 2012, LCB Risk Management, Inc., a captive insurance company incorporated in Nevada, was formed as a wholly owned subsidiary of the Holding Company. All intercompany transactions and balances are eliminated in consolidation. The Company provides financial services through the Bank, a full-service commercial bank with 50 branch offices in fifteen counties in Northern and Central Indiana. The Company provides commercial, retail, trust and investment services to its customers. Commercial products include commercial loans and technology-driven solutions to meet commercial customers’ treasury management needs such as internet business banking and on-line treasury management services. Retail banking clients are provided a wide array of traditional retail banking services, including lending, deposit and investment services. Retail lending programs are focused on mortgage loans, home equity lines of credit and traditional retail installment loans. The Company provides credit card services to retail and commercial customers through its retail card program and merchant processing activity. The Company provides wealth advisory and trust clients with traditional personal and corporate trust services. The Company also provides retail brokerage services, including an array of financial and investment products such as annuities and life insurance. Other financial instruments, which represent potential concentrations of credit risk, include deposit accounts in other financial institutions.
Use of Estimates	Use of Estimates: To prepare financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”), management makes estimates and assumptions based on available information. These estimates and assumptions affect the amounts reported in the financial statements and the disclosures provided and future results could differ.
Cash Flows	Cash Flows: Cash and cash equivalents include cash, demand deposits in other financial institutions and short-term investments and certificates of deposit with maturities of 90 days or less. Cash flows are reported net for customer loan and deposit transactions, and short-term borrowings.
Securities	Securities: Securities are classified as available-for-sale when they might be sold before maturity. Securities available-for-sale are carried at fair value, with unrealized holding gains and losses reported in other comprehensive income (loss), net of tax. Securities are classified as held-to-maturity and carried at amortized cost when management has the positive intent and ability to hold them to maturity. Purchase premiums or discounts are recognized in interest income using the interest method over the terms of the securities or overestimated lives for mortgage-backed securities. Gains and losses on sales are based on the amortized cost of the security sold and recorded on the trade date. For securities in an unrealized loss position, management considers the extent and duration of the unrealized loss, and the financial condition and near-term prospects of the issuer. Management also assesses whether it intends to sell, or it is more likely than not that it will be required to sell, a security in an unrealized loss position before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the entire difference between amortized cost and fair value is recognized as impairment through earnings. For debt securities that do not meet the aforementioned criteria, the amount of impairment is split into two components as follows: 1) other-than-temporary impairment (OTTI) related to credit loss, which must be recognized in the income statement and 2) OTTI related to other factors, which is recognized in other comprehensive income. The credit loss is defined as the difference between the present value of the cash flows expected to be collected and the amortized cost basis. Equity securities which are included in other assets, are carried at fair value with changes in fair value recorded through earnings.
Real Estate Mortgage Loans Held-for-Sale	Real Estate Mortgage Loans Held-for-Sale: Loans held for sale are reported at the lower of cost or fair value on an aggregate basis. Net unrealized losses, if any, are recorded as a valuation allowance and charged to earnings. Loan sales occur on the delivery date agreed to in the relevant commitment agreement. The Company retains servicing on the majority of loans sold. The carrying value of loans sold is reduced by the amount allocated to the servicing right. The gain or loss on the sale of loans is the difference between the carrying value of the loans sold and the funds received from the sale.
Loans	Loans: Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are reported at the principal balance outstanding, net of unearned interest, deferred loan fees and costs, and an allowance for loan losses. Interest income is reported on the interest method and includes amortization of net deferred loan fees and costs over the loan term. All classes of commercial and industrial, commercial real estate and multi-family residential, agri-business and agricultural, other commercial and consumer 1-4 family mortgage loans for which collateral is insufficient to cover all principal and accrued interest are reclassified as nonaccrual loans, on or before the date when the loan becomes 90 days delinquent. When a loan is classified as a nonaccrual loan, interest on the loan is no longer accrued, all unpaid accrued interest is reversed and interest income is subsequently recorded on the cash-basis or cost-recovery method. Accrual status is resumed when all contractually due payments are brought current and future payments are reasonably assured. Other consumer loans are not placed on a nonaccrual status since these loans are charged-off when they have been delinquent from 90 to 180 days, and when the related collateral, if any, is not sufficient to offset the indebtedness. Nonaccrual loans and loans past due 90 days still on accrual include both smaller balance homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans. The recorded investment in loans is the loan balance net of unamortized deferred loan fees and costs. The total amount of accrued interest on loans as of December 31, 2019 and 2018 was $11.5 million and $11.8 million.
Allowance for Loan Losses	Allowance for Loan Losses: The allowance for loan losses is a valuation allowance for probable incurred credit losses. Loan losses are charged against the allowance when management believes the inability to fully collect a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance. The Company has an established process to determine the adequacy of the allowance for loan losses that generally includes consideration of the following factors: changes in the nature and volume of the loan portfolio, overall portfolio quality and current economic conditions that may affect the borrowers’ ability to repay. Consideration is not limited to these factors, although they represent the most commonly cited factors. This evaluation is inherently subjective, as it requires estimates that are susceptible to significant revision as more information becomes available or as future events change. Allocations of the allowance may be made for specific loans, but the entire allowance is available for any loan that, in management’s judgment, should be charged-off. The allowance consists of specific and general components. The specific component relates to loans that are individually classified as impaired. The general component covers non-impaired loans and is based on historical loss experience, subject to a floor, adjusted for current factors. A detailed analysis is performed on loans that are classified but determined not to be impaired which incorporates different scenarios where the risk that the borrower will be unable or unwilling to repay its debt in full or on time is combined with an estimate of loss in the event the borrower cannot pay to develop non-specific allocations for such loan pools. The historical loss experience is determined by portfolio segment and is based on the actual loss history experienced by the Company over the most recent three years, subject to a floor. This loss experience is supplemented with other environmental factors based on the risks present for each portfolio segment. These factors include consideration of the following: levels of, and trends in, delinquencies and impaired loans; trends in volume and terms of loans; effects of any changes in risk selection and underwriting standards; other changes in lending policies, procedure, and practices; experience, ability, and depth of lending management and other relevant staff; national and local economic trends and conditions; industry conditions; and effects of changes in credit concentrations. The following portfolio segments have been identified: commercial and industrial, commercial real estate and multi-family residential, agri-business and agricultural, other commercial, consumer 1-4 family mortgage and other consumer. The risk characteristics of each of the identified portfolio segments are as follows: NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Commercial and Industrial – Borrowers may be subject to industry conditions including decreases in product demand; increases in material or other production costs that cannot be immediately recaptured in the sales or distribution cycle; interest rate increases that could have an adverse impact on profitability; non-payment of credit that has been extended under normal vendor terms for goods sold or services; and interruption related to the importing or exporting of production materials or sold products. Commercial Real Estate and Multi-Family Residential – Borrowers may be subject to potential adverse market conditions that cause a decrease in market value or lease rates; the potential for environmental impairment from events occurring on subject or neighboring properties; and obsolescence in location or function. Multi-Family Residential is also subject to adverse market conditions associated with a change in governmental or personal funding sources for tenants; over supply of units in a specific region; a shift in population; and reputational risks. Construction and Land Development risks include slower absorption than anticipated on speculative projects; deterioration in market conditions that may impact a project’s value; unforeseen costs not considered in the original construction budget; or any other factors that may impact the completion or success of the project. Agri-business and Agricultural – Borrowers may be subject to adverse market or weather conditions including changes in local or foreign demand; lower yields than anticipated; political or other impact on storage, distribution or use; foreign trade policies, including tariffs; and exposure to increasing commodity prices which result in higher production, distribution or exporting costs. Other Commercial – Borrowers may be subject to the uninterrupted flow of funds to states and other political subdivisions for the purpose of debt repayments on loans held by the Bank. Consumer 1-4 Family Mortgage – Borrowers may be subject to adverse employment conditions in the local economy leading to increased default rates; decreased market values from oversupply in a geographic area; and impact to borrowers’ ability to maintain payments in the event of incremental rate increases on adjustable rate mortgages. Other Consumer – Borrowers may be subject to adverse employment conditions in the local economy which may lead to higher default rates; and decreases in the value of underlying collateral. A loan is impaired when, based on current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. Loans, for which the terms have been modified and a concession has been granted for borrowers experiencing financial difficulties, are considered troubled debt restructurings and classified as impaired and may be either accruing or non-accruing. Nonaccrual troubled debt restructurings follow the same policy as described above for other loans. Impairment for troubled debt restructurings is measured at the present value of estimated future cash flows using the loan’s effective rate at inception or at discounted collateral value for collateral dependent loans. Impairment is evaluated individually or in total for smaller-balance loans of similar nature such as all classes of consumer 1-4 family and other consumer loans, and individually for all classes of commercial and industrial, commercial real estate and multi-family, agri-business and agricultural and other commercial loans. The Company analyzes commercial loans individually by classifying the loans as to credit risk. This analysis is performed on a quarterly basis for Special Mention, Substandard and Doubtful grade loans and annually on Pass grade loans over $250,000. Factors considered by management in determining impairment include payment status, collateral value and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed. If a loan is impaired, a portion of the allowance may be allocated so that the loan is reported, net, at the present value of estimated future cash flows using the loan’s existing rate or at the fair value of collateral less anticipated costs to sell if repayment is expected solely from the collateral. All classes of commercial and industrial, commercial real estate and multifamily residential, agri-business and agricultural, other commercial and consumer 1-4 family mortgage loans that become delinquent beyond 90 days are analyzed and a charge-off is taken when it is determined that the underlying collateral, if any, is not sufficient to offset the indebtedness. NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Troubled debt restructured loans are considered for removal from troubled debt restructuring status in the year following modification or at time of subsequent restructuring for loans with cumulative principal forgiveness if the interest rate is considered a market rate at the time of modification and it has been performing according to the terms of the modification for a reasonable period of time long enough to observe an ability to repay under the modified terms. If removed from troubled debt restructuring status, the loan continues to be evaluated for impairment with either the present value of estimated future cash flows using the loan’s effective rate at inception or at discounted collateral value for collateral dependent loans. In addition, troubled debt restructured loans with subsequent modifications that do not have cumulative principal forgiveness are considered for removal from troubled debt restructuring status at the time of the subsequent modification if the following circumstances exist: (1) at the time of the subsequent restructuring, the borrower is not experiencing financial difficulties; (2) under the terms of the subsequent restructuring agreement no concession has been granted to the borrower; and (3) the subsequent restructuring agreement includes market terms that are no less favorable than those that would be offered for comparable new debt. Upon meeting these criteria, the loan is no longer individually evaluated for impairment and is no longer disclosed as a troubled debt restructuring.
Investments in Limited Partnerships	Investments in Limited Partnerships: The Company enters into and invests in limited partnerships in order to invest in affordable housing projects for the primary purpose of obtaining available tax benefits. The Company is a limited partner in these investments and, as such, the Company is not involved in the management or operation of such investments. These investments are accounted for using the equity method of accounting. Under the equity method of accounting, the Company records its share of the partnership’s earnings or losses in its income statement and adjusts the carrying amount of the investments on the consolidated balance sheet. These investments are evaluated for impairment when events indicate the carrying amount may not be recoverable. The investments recorded at December 31, 2019 and 2018 were $6.7 million and $7.0 million, respectively and are included with other assets in the consolidated balance sheet. The Company also has a commitment to fund an additional $1.6 million at December 31, 2019 in two of the limited partnerships compared to $2.1 million at December 31, 2018, which is included with other liabilities in the consolidated balance sheet.
Foreclosed Assets	Foreclosed Assets: Assets acquired through loan foreclosure are initially recorded at fair value less costs to sell when acquired, establishing a new cost basis. These assets are subsequently accounted for at lower of cost or fair value less estimated costs to sell. If fair value declines, a valuation allowance is recorded through expense. Costs incurred after acquisition are expensed. At December 31, 2019 and 2018, the balance of other real estate owned was $316,000 and is included with other assets on the consolidated balance sheet.
Land, Premises and Equipment, Net	Land, Premises and Equipment, Net: Land is carried at cost. Premises and equipment are stated at cost less accumulated depreciation. Depreciation is computed on the straight-line method over the useful lives of the assets. Premises and improvements assets have useful lives between 5 and 40 years. Equipment and furniture assets have useful lives between 3 and 7 years.
Loan Servicing Rights	Loan Servicing Rights: Servicing rights are recognized separately when they are acquired through sales of loans. When mortgage loans are sold, servicing rights are initially recorded at fair value with the income statement effect recorded in mortgage banking income. Fair value is based on a valuation model that calculates the present value of estimated future net servicing income. All classes of servicing assets are subsequently measured using the amortization method which requires servicing rights to be amortized into noninterest income in proportion to, and over the period of, the estimated future net servicing income of the underlying loans. The amortization of servicing rights is netted against mortgage banking income. Servicing fees totaled $1.1 million, $1.1 million and $1.0 million for the years ended December 31, 2019, 2018 and 2017, respectively. Late fees and ancillary fees related to loan servicing are not material. NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Servicing rights are evaluated for impairment based upon the fair value of the rights as compared to carrying amount. Impairment is determined by stratifying rights into groupings based on predominant risk characteristics, such as loan type, term and interest rate. Any impairment of a grouping is reported as a valuation allowance, to the extent that fair value is less than the carrying amount. If the Company later determines that all or a portion of the impairment no longer exists for a particular grouping, a reduction of the allowance may be recorded as an increase to income. Changes in the valuation allowance are reported with mortgage banking income on the income statement. The fair values of servicing rights are subject to significant fluctuations as a result of changes in estimated and actual prepayment speeds and default rates and losses. The carrying value of mortgage servicing rights, which is included with other assets in the consolidated balance sheet, was $3.8 million and $3.3 million as of December 31, 2019 and 2018. Mortgage loans serviced for others are not included in the accompanying consolidated balance sheets. The unpaid principal balances of these loans were $337.9 million and $343.5 million at December 31, 2019 and 2018. Custodial escrow balances maintained in connection with serviced loans were $1.6 million at year end 2019 and 2018. Servicing fee income (loss), which is included in loan and service fees on the income statement, is recorded for fees earned for servicing loans. Fees earned for servicing loans are based on a contractual percentage of the outstanding principal amount of the loan and are recorded as income when earned.
Transfers of Financial Assets	Transfers of Financial Assets: Transfers of financial assets are accounted for as sales, when control over the assets has been relinquished. Control over transferred assets is deemed to be surrendered when the assets have been isolated from the Company, the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets and the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity.
Mortgage Banking Derivatives	Mortgage Banking Derivatives: Commitments to fund mortgage loans (interest rate locks) to be sold into the secondary market and forward commitments for the future delivery of these mortgage loans are accounted for as free standing derivatives. Fair values of these mortgage derivatives are estimated based on changes in mortgage interest rates from the date the interest on the loan is locked. The Company enters into forward commitments for the future delivery of mortgage loans when interest rate locks are entered into, in order to hedge the change in interest rates resulting from its commitments to fund the loans. Changes in fair values of these derivatives are included in mortgage banking income.
Interest Rate Swap Derivatives	Interest Rate Swap Derivatives: The Company offers a derivative product to certain creditworthy commercial banking customers. This product allows the commercial banking customers to enter into an agreement with the Company to swap a variable rate loan to a fixed rate. These derivative products are designed to reduce, eliminate or modify the borrower’s interest rate exposure. The extension of credit incurred in connection with these derivative products is subject to the same approval and underwriting standards as traditional credit products. The Company limits its risk exposure by simultaneously entering into a similar, offsetting swap agreement with a separate, well-capitalized and highly rated counterparty previously approved by the Company’s Asset Liability Committee. By using these interest rate swap arrangements, the Company is also better insulated from the interest rate risk associated with underwriting fixed-rate loans and is better able to meet customer demand for fixed rate loans. These derivative contracts are not designated against specific assets or liabilities and, therefore, do not qualify for hedge accounting. The derivatives are recorded as assets and liabilities on the balance sheet at fair value with changes in fair value recorded in non-interest income for both the commercial banking customer swaps and the related offsetting swaps. The fair value of the derivative instruments incorporates a consideration of credit risk (in accordance with ASC 820), resulting in some potential volatility in earnings each period. NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) The notional amount of the combined interest rate swaps with customers and counterparties at December 31, 2019 and 2018 was $349.6 million and $258.0 million, respectively. The fair value of the interest rate swap asset was $7.3 million and $3.9 million and the fair value of the interest rate swap liability was $7.9 million and $4.0 million at December 31, 2019 and 2018, respectively.
Bank Owned Life Insurance	Bank Owned Life Insurance: At December 31, 2019 and 2018, the Company owned $79.8 million and $73.9 million, respectively, of life insurance policies on certain officers to provide a life insurance benefit for these officers. At December 31, 2019 and 2018, the Company also owned $4.0 million and $3.2 million, respectively, of variable life insurance on certain officers related to a deferred compensation plan. Bank owned life insurance is recorded at the amount that can be realized under the insurance contract at the balance sheet date, i.e., the cash surrender value adjusted for other changes or other amounts due that are probable at settlement.
Goodwill and Other Intangible Assets	Goodwill and Other Intangible Assets: All goodwill on the Company’s consolidated balance sheet resulted from business combinations prior to January 1, 2009 and represents the excess of the purchase price over the fair value of acquired tangible assets and liabilities and identifiable intangible assets. Goodwill is not amortized, but assessed at least annually for impairment and any such impairment will be recognized in the period identified.
FHLB and Federal Reserve Bank Stock	FHLB and Federal Reserve Bank Stock: FHLB and Federal Reserve Bank stock are carried at cost in other assets, classified as a restricted security and are periodically evaluated for impairment based on ultimate recoverability of par value. Both cash and stock dividends are reported as income.
Repurchase Agreements	Repurchase Agreements: Substantially all repurchase agreement liabilities represent amounts advanced by various customers. Securities are pledged to cover these liabilities, which are not covered by federal deposit insurance. This product was discontinued during 2019.
Long-term Assets	Long-term Assets: Premises and equipment, and other long-term assets are reviewed for impairment when events indicate their carrying amount may not be recoverable from future undiscounted cash flows. If impaired, the assets are recorded at fair value.
Benefit Plans	Benefit Plans: The Company has a noncontributory defined benefit pension plan, which covered substantially all employees until the plan was frozen effective April 1, 2000. Funding of the plan equals or exceeds the minimum funding requirement determined by the actuary. Pension expense is the net of interest cost, return on plan assets and amortization of gains and losses not immediately recognized. Benefits are based on years of service and compensation levels. The Company maintains a 401(k) profit sharing plan for all employees meeting certain age and service requirements. The Company contributions are based upon the percentage of budgeted net income earned during the year. An employee deferred compensation plan is available to certain employees with returns based on investments in mutual funds. The Company maintains a directors’ deferred compensation plan. Effective January 1, 2003, the directors’ deferred compensation plan was amended to restrict the deferral to be in stock only and deferred directors’ fees are included in equity. The Company acquires shares on the open market and records such shares as treasury stock.
Stock Based Compensation	Stock Based Compensation: Compensation cost is recognized for stock options and restricted stock awards issued to employees, based on the fair value of these awards at the date of grant. A Black-Scholes model is utilized to estimate the fair value of stock options, while the market price of the Company’s common stock at the date of grant adjusted for the present value of expected dividends is used for restricted stock awards. Compensation cost is recognized over the required service period, generally defined as the vesting period. Certain of the restricted stock awards are performance based, as more fully discussed in Note 15 – Stock Based Compensation.
Income Taxes	Income Taxes: Annual consolidated federal and state income tax returns are filed by the Company. Deferred income tax assets and liabilities are determined using the liability (or balance sheet) method. Income tax expense is recorded based on the amount of taxes due on its tax return plus net deferred taxes computed based upon the expected future tax consequences of temporary differences between carrying amounts and tax basis of assets and liabilities, using enacted tax rates. A valuation allowance, if needed, reduces deferred tax assets to the amount expected to be realized. A tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is more likely of being realized on examination than not. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. The Company recognizes interest and/or penalties related to income tax matters in income tax expense.
Off-Balance Sheet Financial Instruments	Off-Balance Sheet Financial Instruments: Financial instruments include credit instruments, such as commitments to make loans and standby letters of credit, issued to meet customer financing needs. The face amount for these items represents the exposure to loss, before considering customer collateral or ability to repay. Such financial instruments are recorded when they are funded. The fair value of standby letters of credit is recorded as a liability during the commitment period.
Earnings Per Common Share	Earnings Per Common Share: Basic earnings per common share is net income divided by the weighted average number of common shares outstanding during the period. Diluted earnings per common share includes the dilutive effect of additional potential common shares issuable under stock options, restricted stock awards and warrants. Earnings and dividends per share are restated for all stock splits and dividends through the date of issue of the financial statements. The common shares included in treasury stock for 2019 and 2018 include 178,741 and 172,959 shares, respectively, of Company common stock that has been purchased under the directors’ deferred compensation plan described above. Because these shares are held in trust for the participants, they are treated as outstanding when computing the weighted-average common shares outstanding for the calculation of both basic and diluted earnings per share.
Comprehensive Income	Comprehensive Income: Comprehensive income consists of net income and other comprehensive income (loss). Other comprehensive income (loss) includes unrealized gains and losses on securities available-for-sale and changes in the funded status of the pension plan, which are also recognized as separate components of equity.
Loss Contingencies	Loss Contingencies: Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated. Management does not believe there currently are such matters that will have a material effect on the financial statements.
Restrictions on Cash	Restrictions on Cash: The Company was required to have $28.9 million and $6.4 million of cash on hand or on deposit with the Federal Reserve Bank to meet regulatory reserve and clearing requirements at year-end 2019 and 2018, respectively. The Company met this requirement both years.
Dividend Restriction	Dividend Restriction: Banking regulations require maintaining certain capital levels and may limit the dividends paid by the Bank to the Company or by the Company to its stockholders. These restrictions currently pose no practical limit on the ability of the Bank or Company to pay dividends at historical levels.
Fair Value of Financial Instruments	Fair Value of Financial Instruments: Fair values of financial instruments are estimated using relevant market information and other assumptions, as more fully disclosed in Note 5 - Fair Value. Fair value estimates involve uncertainties and matters of significant judgment regarding interest rates, credit risk, prepayments and other factors, especially in the absence of broad markets for particular items. Changes in assumptions or in market conditions could significantly affect the estimates.
Operating Segments	Operating Segments: The Company’s chief decision-makers monitor and evaluate financial performance on a Company-wide basis. All of the Company’s financial service operations are similar and considered by management to be aggregated into one reportable operating segment. While the Company has assigned certain management responsibilities by region and business-line, the Company’s chief decision-makers monitor and evaluate financial performance on a Company-wide basis. The majority of the Company’s revenue is from the business of banking and the Company’s assigned regions have similar economic characteristics, products, services and customers. Accordingly, all of the Company’s operations are considered by management to be aggregated in one reportable operating segment.
Adoption of New Accounting Standards	Adoption of New Accounting Standards: The Company accounts for leases in accordance with ASU 2016-02, “Leases”, which the Company adopted on January 1, 2019. This guidance replaced existing lease guidance in GAAP and requires lessees to recognize lease assets and lease liabilities on the balance sheet for all leases and disclose key information about leasing arrangements. Lessees and lessors are required to recognize and measure leases that exist at the beginning of the earliest period presented using a modified retrospective approach. The Company recorded a right-of-use asset of $5.5 million and a lease liability of $5.5 million upon adoption, and there was no cumulative period adjustment made to retained earnings. This standard did not have a material impact on the Company’s consolidated balance sheets or cash flows from operations and had no impact on the Company’s operating results. The most significant impact was the recognition of right-of-use assets and lease obligations for operating leases. The Company elected to adopt the package of practical expedients for this standard. Disclosures are presented in Note 25 – Leases. NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) In March 2017, the FASB issued ASU No. 2017-08, “Receivables-Nonrefundable Fees and Other Costs: Premium Amortization on Purchased Callable Debt Securities.” This update amends the amortization period for certain purchased callable debt securities held at a premium. FASB has shortened the amortization period for the premium to the earliest call date. Under legacy GAAP, entities generally amortized the premium as an adjustment of yield over the contractual life of the instrument. The amendments in this update became effective for annual periods and interim periods within those annual periods beginning after December 15, 2018. The Company adopted this new accounting standard on January 1, 2019. The effect of adoption was a reduction in retained earnings of approximately $1.3 million to reflect the acceleration of amortization of premiums on available-for-sale debt securities. In August 2017, the FASB issued ASU 2017-12, “Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities”. The purpose of this updated guidance is to better align a company's financial reporting for hedging activities with the economic objectives of those activities. ASU 2017-12 is effective for public business entities for fiscal years beginning after December 15, 2018, with early adoption, including adoption in an interim period, permitted. The Company adopted ASU 2017-12 on January 1, 2019. ASU 2017-12 required a modified retrospective transition method in which the Company recognized the cumulative effect of the change on the opening balance of each affected component of equity in the consolidated balance sheet as of the date of adoption. Adopting this standard did not have an impact on the Company’s financial condition or operations.
Newly Issued But Not Yet Effective Accounting Standards	Newly Issued But Not Yet Effective Accounting Standards: In June 2016, the FASB issued guidance related to credit losses on financial instruments. This update, commonly referred to as the current expected credit losses methodology (“CECL”), will change the accounting for credit losses on loans and debt securities. Under the new guidance, the Company’s measurement of expected credit losses is to be based on information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. For loans, this measurement will take place at the time the financial asset is first added to the balance sheet and periodically thereafter. This differs significantly from the “incurred loss” model required under current GAAP, which delays recognition until it is probable a loss has been incurred. In addition, the guidance will modify the other-than-temporary impairment model for available-for-sale debt securities to require an allowance for credit impairment instead of a direct write-down, which will allow for reversal of credit impairments in future periods. This guidance is effective for the Company for fiscal years beginning after December 15, 2019, including interim periods in those fiscal years. This amendment is required to be adopted using a modified retrospective approach with a cumulative-effect adjustment to beginning retained earnings, as of the beginning of the first reporting period in which the guidance is effective. The Company formed a cross-functional committee that has evaluated existing technology and other solutions to assist with calculating losses under this new standard, selected a vendor to validate data currently loaded in the technology solution, and reviewed the validation assessment report. Additionally, the committee has selected a probability of default/loss given default model, run parallel calculations and evaluated changes to the overall internal control structure under the new model. Upon adoption of this standard, the Company will recognize credit losses earlier than it historically has done under the current incurred loss model. The Company will utilize a one to two year reasonable and supportable forecast period. Due to this change in methodology, the Company anticipates larger increases in credit loss allowances for its longer-lived retail portfolios and smaller increases for its shorter-lived commercial portfolio. Based upon the Company’s loan portfolio composition at December 31, 2019, and the current economic environment and management’s current forecast and qualitative adjustment assumptions, the Company estimates an 8% - 13% increase in its allowance for credit losses upon adoption of this standard. The final impact of CECL on its allowance for credit losses, effective January 1, 2020, will depend on refinements to key assumptions including forecasting and qualitative factors. Once final, the calculation will require approval by the loan review committee and governance in accordance with the Company’s internal controls over financial reporting. Additionally, the Company has evaluated the need to recognize an allowance for credit impairment for available-for-sale debt securities. The impact on available-for-sale debt securities is subject to a limitation, which is based on the fair value of the debt securities. When evaluating the credit quality of our existing portfolio, the Company does not expect the allowance for credit impairment for available-for-sale securities to be significant. NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) In January 2017, the FASB issued ASU No. 2017-04 "Intangibles - Goodwill and Other - Simplifying the Test for Goodwill Impairment." These amendments eliminate Step 2 from the goodwill impairment test. The amendments also eliminate the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment and, if it fails that qualitative test, to perform Step 2 of the goodwill impairment test. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. The guidance is effective for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. ASU 2017-04 should be adopted on a prospective basis. Management does not expect the adoption of this new accounting standard to have a material impact on our financial statements.
Reclassifications	Reclassifications: Certain amounts appearing in the financial statements and notes thereto for prior periods have been reclassified to conform with the current presentation. The reclassifications had no effect on net income or stockholders’ equity as previously reported.

INCOME TAXES - Additional Information (Details) - USD ($)	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
INCOME TAXES
Income tax expense	$ 5,431,000	$ 5,119,000	$ 5,409,000	$ 4,379,000	$ 5,480,000	$ 4,679,000	$ 5,110,000	$ 3,264,000	$ 20,338,000	$ 18,533,000	$ 32,304,000
Statutory percentage rate of provision									21.00%	21.00%	35.00%
Deferred Tax Assets Unrealized Gain Losses On Available for Sale Securities Gross	(3,600,000)				1,300,000				$ (3,600,000)	$ 1,300,000
Deferred Tax Liabilities Allocated To Benefit Plan	$ 512,000				$ 462,000				512,000	462,000
Non-cash, Non-operating and Non-recurring Income Tax Provision											$ 4,100,000
Effective Income Tax Rate Reconciliation, Change in Deferred Tax Assets Valuation Allowance, Amount									$ 0	$ (408,000)	$ 4,137,000

DEPOSITS - Scheduled Maturities of Time Deposits (Details) $ in Thousands	Dec. 31, 2019 USD ($)
DEPOSITS
Maturing in 2020	$ 895,601
Maturing in 2021	206,303
Maturing in 2022	35,181
Maturing in 2023	23,143
Maturing in 2024	29,747
Thereafter	2,092
Total time deposits	$ 1,192,067

INCOME TAXES - Summary of Income Tax Expense (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
INCOME TAXES
Current federal									$ 19,430	$ 16,871	$ 27,064
Deferred federal									(408)	707	(199)
Revalue deferred taxes due to tax reform									0	(408)	4,137
Current state									1,394	1,462	1,559
Deferred state									(78)	(99)	(257)
Total income tax expense	$ 5,431	$ 5,119	$ 5,409	$ 4,379	$ 5,480	$ 4,679	$ 5,110	$ 3,264	$ 20,338	$ 18,533	$ 32,304

PENSION AND OTHER POSTRETIREMENT PLANS (Additional Information) (Details) - USD ($)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Equity Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plans Target Allocation Percentage	60.00%
Defined Benefit Plan, Assumptions Used Calculating Net Periodic Benefit Cost, Expected Long-term Rate of Return on Plan Assets	8.85%
Debt Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plans Target Allocation Percentage	40.00%
Defined Benefit Plan, Assumptions Used Calculating Net Periodic Benefit Cost, Expected Long-term Rate of Return on Plan Assets	3.00%
Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Accumulated Benefit Obligation	$ 2,700,000	$ 2,100,000
Assets for Plan Benefits, Defined Benefit Plan	$ 2,470,000	$ 2,148,000
Defined Benefit Plan, Assumptions Used Calculating Net Periodic Benefit Cost, Expected Long-term Rate of Return on Plan Assets	6.50%	6.50%	6.50%
Defined Benefit Plan, Expected Amortization, Next Fiscal Year	$ 172,000
Pension Benefits \| Accrued Interest and Dividend Income [Member]
Defined Benefit Plan Disclosure [Line Items]
Assets for Plan Benefits, Defined Benefit Plan	$ 2,000	$ 3,000
Pension Benefits \| Equity Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assumptions Used Calculating Net Periodic Benefit Cost, Expected Long-term Rate of Return on Plan Assets	8.85%
Pension Benefits \| Debt Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assumptions Used Calculating Net Periodic Benefit Cost, Expected Long-term Rate of Return on Plan Assets	3.00%
SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Accumulated Benefit Obligation	$ 1,000,000.0	900,000
Assets for Plan Benefits, Defined Benefit Plan	$ 913,000	$ 884,000
Defined Benefit Plan, Assumptions Used Calculating Net Periodic Benefit Cost, Expected Long-term Rate of Return on Plan Assets	6.50%	6.50%	6.50%
Defined Benefit Plan, Expected Amortization, Next Fiscal Year	$ 80,000
SERP Benefits \| Accrued Interest and Dividend Income [Member]
Defined Benefit Plan Disclosure [Line Items]
Assets for Plan Benefits, Defined Benefit Plan	$ 1,000	$ 1,000
SERP Benefits \| Equity Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assumptions Used Calculating Net Periodic Benefit Cost, Expected Long-term Rate of Return on Plan Assets	8.85%
SERP Benefits \| Debt Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assumptions Used Calculating Net Periodic Benefit Cost, Expected Long-term Rate of Return on Plan Assets	3.00%

BORROWINGS (Tables)

12 Months Ended

Dec. 31, 2019

BORROWINGS

Schedule of Short-Term Debt

For the years ending December 31, advances from the Federal Home Loan Bank were as follows:


(dollars in thousands)	2019		2018
Federal Home Loan Bank of Indianapolis Advance, 1.61%, Due January 7, 2020	$	170,000	$	0
Federal Home Loan Bank of Indianapolis Advance, 2.52%, Due January 7, 2019		0		170,000
Total	$	170,000	$	170,000

Schedule of securities Sold with Agreements to Repurchase


(dollars in thousands)	2019			2018			2017
Securities sold under agreements to repurchase
Outstanding at year end	$	0		$	75,555		$	70,652
Approximate average interest rate at year end		0.00	%		0.74	%		0.46	%
Highest amount outstanding as of any month end during the year	$	72,814		$	106,239		$	77,886
Approximate average outstanding during the year		15,104			86,874			63,379
Approximate average interest rate during the year		0.86	%		0.58	%		0.39	%

Document And Entity Information - USD ($)	12 Months Ended
Document And Entity Information - USD ($)	Dec. 31, 2019	Feb. 18, 2020	Jun. 30, 2019
Document and Entity Information
Document Type	10-K
Document Annual Report	true
Document Transition Report	false
Document Period End Date	Dec. 31, 2019
Entity File Number	0-11487
Entity Registrant Name	LAKELAND FINANCIAL CORPORATION
Entity Incorporation, State or Country Code	IN
Entity Tax Identification Number	35-1559596
Entity Address, Address Line One	202 East Center Street
Entity Address, Address Line Two	P.O. Box 1387
Entity Address, City or Town	Warsaw
Entity Address, State or Province	IN
Entity Address, Postal Zip Code	46581
City Area Code	574
Local Phone Number	267-6144
Title of 12(b) Security	Common Stock, no par value
Trading Symbol	LKFN
Security Exchange Name	NASDAQ
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Public Float			$ 1,128,651,235
Entity Common Stock, Shares Outstanding		25,701,115
Entity Central Index Key	0000721994
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	FY
Amendment Flag	false

WARRANT

12 Months Ended

Dec. 31, 2019

WARRANT

WARRANT

NOTE 23 – WARRANT

On February 27, 2009, the Company entered into a Letter Agreement with the Treasury, pursuant to which the Company issued (i) 56,044 shares of the Company’s Series A Preferred Stock and (ii) the Warrant to purchase 396,538 shares of the Company’s common stock, no par value, for an aggregate purchase price of $56,044,000 in cash. This transaction was conducted in accordance with the CPP. On June 9, 2010, the Company redeemed the Series A Preferred Stock and accreted the remaining unamortized discount on these shares. The Company did not repurchase the Warrant, and the Warrant was sold by Treasury to an independent, third party.

The Warrant had a 10-year term and was immediately exercisable upon its issuance, with an exercise price, subject to anti-dilution adjustments, equal to $21.20 per share of the common stock (trailing 20-day Lakeland average closing price as of December 17, 2008, which was the last trading day prior to date of receipt of Treasury’s preliminary approval for our participation in the CPP). The Warrant was valued using the Black-Scholes model with the following assumptions: market price of $17.45; exercise price of $21.20; risk-free interest rate of 3.02%; expected life of 10 years; expected dividend rate on common stock of 4.5759% and volatility of common stock price of 41.8046%. This resulted in a value of $4.4433 per share of common stock underlying the Warrant.

On December 3, 2009, the Company was notified by Treasury that, as a result of the Company’s completion of our November 18, 2009 Qualified Equity Offering, the amount of the Warrant was reduced by 50% to 198,269 shares. In accordance with the terms of the Warrant, the number of shares issuable upon exercise and the exercise price were adjusted each time the Company paid a dividend to its stockholders in excess of the dividend paid at the time the warrant was issued. Based on the formula set forth in the warrant, at December 31, 2018, the number of shares issuable upon exercise of the Warrant were 314,846 and the exercise price was $13.3503.

NOTE 23 – WARRANT (continued)

On February 4, 2019 the Company was notified that the holder of the Warrant was initiating the exercise on a cashless basis. At the time of exercise, the holder was entitled to 315,961 shares of common stock. The cost to exercise the Warrant was approximately $4.2 million, which was the equivalent of 91,894 shares of common stock with a fair value of $45.74 per share. On February 8, 2019, the Company issued 224,066 shares to the Warrant holder as a cashless exercise and the Warrant was retired. The issuance of the shares was exempt from registration pursuant to Section 3(a)(9) under the Securities Act of 1933.

OTHER BENEFIT PLANS

12 Months Ended

Dec. 31, 2019

OTHER BENEFIT PLANS

OTHER BENEFIT PLANS

NOTE 12 – OTHER BENEFIT PLANS

401(k) Plan

The Company maintains a 401(k) profit sharing plan for all employees meeting certain age and service requirements. The 401(k) plan allows employees to contribute up to the maximum amount allowable under the Internal Revenue Code, which are matched based upon the percentage of budgeted net income earned during the year on the first 6% of the compensation contributed. The expense recognized from matching was $1.8 million, $1.8 million and $1.7 million in 2019, 2018 and 2017, respectively.

Deferred Compensation Plan

Effective January 1, 2004, the Company adopted the Lake City Bank Deferred Compensation Plan. The purpose of the deferred compensation plan is to extend full 401(k) type retirement benefits to certain individuals without regard to statutory limitations under tax qualified plans. A liability is accrued by the Company for its obligation under this plan. The (income) expense recognized was $461,000, ($31,000) and $456,000 during the years ended December 31, 2019, 2018 and 2017, respectively. This resulted in a deferred compensation liability of $4.2 million and $3.3 million as of year-end 2019 and 2018, respectively. The deferred compensation plan is funded solely by participant contributions and does not receive a Company match.

Employee Agreements

Under employment agreements with certain executives, certain events leading to separation from the Company could result in cash payments totaling $5.3 million as of December 31, 2019. On December 31, 2019, no amounts were accrued on these contingent obligations.

Directors’ Deferred Compensation and Cash Plans

The Company maintains a directors’ deferred compensation plan and a cash plan. The amount owed to directors for fees under the deferred directors’ compensation and cash plans as of December 31, 2019 and 2018 was $4.4 million and $4.0 million, respectively. The related expense for the deferred directors’ compensation and cash plans for the years ended December 31, 2019, 2018 and 2017 was $515,000, $486,000 and $491,000, respectively.

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) - Reclassification Adjustment (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Unrealized gains and losses on available-for-sale securities
Net securities gains (losses)	$ 142	$ (50)	$ 32
Income tax expense	(30)	11	(13)
Net of tax	112	(39)	19
Amortization of defined benefit pension items
Salaries and employee benefits	(205)	(266)	(265)
Income tax expense	52	69	104
Net of tax	(153)	(197)	(161)
Total reclassifications for the period	$ (41)	$ (236)	$ (142)

FAIR VALUE - Estimated Fair Values And The Related Carrying Values Of Financial Instruments (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Financial Assets:
Securities available-for-sale	$ 608,233	$ 585,549
Financial Liabilities:
Federal Home Loan Bank advances	(170,000)	(170,000)
Carrying Value
Financial Assets:
Cash and cash equivalents	99,381	216,922
Securities available-for-sale	608,233	585,549
Real estate mortgages held-for-sale	4,527	2,293
Loans, net	4,015,176	3,866,292
Federal Reserve and Federal Home Loan Bank Stock	13,772	13,772
Accrued interest receivable	15,391	15,518
Financial Liabilities:
Certificates of deposit	(1,192,067)	(1,419,754)
All other deposits	(2,941,752)	(2,624,311)
Securities sold under agreements to repurchase		(75,555)
Federal Home Loan Bank advances	(170,000)	(170,000)
Subordinated debentures		(30,928)
Standby letters of credit	(915)	(978)
Accrued interest payable	(11,604)	(10,404)
Estimate of Fair Value Measurement
Financial Assets:
Cash and cash equivalents	99,381	216,922
Securities available-for-sale	608,233	585,549
Real estate mortgages held-for-sale	4,614	2,314
Loans, net	3,979,006	3,786,175
Accrued interest receivable	15,391	15,518
Financial Liabilities:
Certificates of deposit	(1,202,060)	(1,424,553)
All other deposits	(2,941,752)	(2,624,311)
Securities sold under agreements to repurchase		(75,555)
Federal Home Loan Bank advances	(169,998)	(169,996)
Subordinated debentures		(31,195)
Standby letters of credit	(915)	(978)
Accrued interest payable	(11,604)	(10,404)
Level 1 \| Estimate of Fair Value Measurement
Financial Assets:
Cash and cash equivalents	96,603	214,452
Securities available-for-sale	0	987
Real estate mortgages held-for-sale	0	0
Loans, net	0	0
Accrued interest receivable	0	3
Financial Liabilities:
Certificates of deposit	0	0
All other deposits	(2,941,752)	(2,624,311)
Securities sold under agreements to repurchase		0
Federal Home Loan Bank advances	0	0
Subordinated debentures		0
Standby letters of credit	0	0
Accrued interest payable	(102)	(110)
Level 2 \| Estimate of Fair Value Measurement
Financial Assets:
Cash and cash equivalents	2,778	2,470
Securities available-for-sale	608,088	584,412
Real estate mortgages held-for-sale	4,614	2,314
Loans, net	0	0
Accrued interest receivable	3,729	3,569
Financial Liabilities:
Certificates of deposit	(1,202,060)	(1,424,553)
All other deposits	0	0
Securities sold under agreements to repurchase		(75,555)
Federal Home Loan Bank advances	(169,998)	(169,996)
Subordinated debentures		0
Standby letters of credit	0	0
Accrued interest payable	(11,502)	(10,289)
Level 3 \| Estimate of Fair Value Measurement
Financial Assets:
Cash and cash equivalents	0	0
Securities available-for-sale	145	150
Real estate mortgages held-for-sale	0	0
Loans, net	3,979,006	3,786,175
Accrued interest receivable	11,662	11,946
Financial Liabilities:
Certificates of deposit	0	0
All other deposits	0	0
Securities sold under agreements to repurchase		0
Federal Home Loan Bank advances	0	0
Subordinated debentures		(31,195)
Standby letters of credit	(915)	(978)
Accrued interest payable	$ 0	$ (5)

OTHER BENEFIT PLANS (Details) - USD ($)	12 Months Ended
OTHER BENEFIT PLANS (Details) - USD ($)	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Summary of Other Benefit Plan [Line Items]
Potential Cash Payments Under Employment Agreements	$ 5,300,000
Directors' Deferred Compensation and Cash Plans
Summary of Other Benefit Plan [Line Items]
Deferred Compensation Liability	4,400,000	$ 4,000,000.0
Deferred Compensation Arrangement with Individual, Compensation Expense	515,000	486,000	$ 491,000
Other Employee Benefit Plans
Summary of Other Benefit Plan [Line Items]
Deferred Compensation Expense	461,000	(31,000)	456,000
Deferred Compensation Liability	4,200,000	3,300,000
Retirement Benefits Plan 401k
Summary of Other Benefit Plan [Line Items]
Deferred Compensation Expense	$ 1,800,000	$ 1,800,000	$ 1,700,000
Defined Contribution Plan, Maximum Annual Contributions Per Employee, Percent	6.00%

PARENT COMPANY STATEMENTS - CONDENSED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Condensed Financial Statements, Captions [Line Items]
Other income									$ 4,548	$ 2,573	$ 2,629
Interest expense on subordinated debt	$ (13,430)	$ (15,224)	$ (16,224)	$ (15,285)	$ (14,138)	$ (12,454)	$ (11,262)	$ (9,845)	(60,163)	(47,699)	(29,806)
INCOME BEFORE INCOME TAX EXPENSE									107,385	98,944	89,634
Income tax benefit	(5,431)	(5,119)	(5,409)	(4,379)	(5,480)	(4,679)	(5,110)	(3,264)	(20,338)	(18,533)	(32,304)
NET INCOME	$ 22,198	$ 21,454	$ 21,713	$ 21,682	$ 21,363	$ 20,570	$ 20,142	$ 18,336	87,047	80,411	57,330
COMPREHENSIVE INCOME									105,297	75,131	59,047
Reportable Legal Entities [Member] \| Parent Company [Member]
Condensed Financial Statements, Captions [Line Items]
Other income									155	171	57
Interest expense on subordinated debt									(1,720)	(1,643)	(1,349)
Miscellaneous expense									(5,321)	(6,422)	(6,491)
INCOME BEFORE INCOME TAX EXPENSE									52,258	21,049	15,069
Income tax benefit									2,256	2,795	2,688
INCOME BEFORE EQUITY IN UNDISTRIBUTED INCOME OF SUBSIDIARIES									54,514	23,844	17,757
Equity in undistributed income of subsidiaries									32,533	56,567	39,573
NET INCOME									87,047	80,411	57,330
COMPREHENSIVE INCOME									105,297	75,131	59,047
Reportable Legal Entities [Member] \| Parent Company [Member] \| Lake City Bank [Member]
Condensed Financial Statements, Captions [Line Items]
Dividends from Lake City Bank, Lakeland Statutory Trust II									57,842	27,933	21,822
Reportable Legal Entities [Member] \| Parent Company [Member] \| Non-bank Subsidiaries [Member]
Condensed Financial Statements, Captions [Line Items]
Dividends from Lake City Bank, Lakeland Statutory Trust II									$ 1,302	$ 1,010	$ 1,030

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
CONSOLIDATED BALANCE SHEETS
Valuation allowance	$ 50,652	$ 48,453
Common stock, shares authorized (in shares)	90,000,000	90,000,000
Common stock, no par value (in dollars per share)	$ 0	$ 0
Common stock, shares issued (in shares)	25,623,016	25,301,732
Common stock, shares outstanding (in shares)	25,444,275	25,128,773
Treasury stock, at cost	178,741	172,959

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Changes in Accumulated Other Comprehensive Income By Component) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Unrealized Gains and Losses on Available- for-Sales Securities, Opening Balance	$ (4,796)	$ 784
Unrealized Gains and Losses on Available- for-Sales Securities, Other comprehensive income ( loss ) before reclassification	18,515	(5,691)
Unrealized Gains and Losses on Available- for-Sales Securities, Amounts reclassified from accumulated other comprehensive income (loss)	(112)	39
Unrealized Gains and Losses on Available- for-Sales Securities, Net current period other comprehensive income (loss)	18,403	(5,652)
Unrealized Gains and Losses on Available- for-Sales Securities, Ending Balance	13,607	(4,796)	$ 784
Defined Benefit Pension Items, Opening Balance	(1,395)	(1,454)
Defined Benefit Pension Items, Other comprehensive income before reclassification	(306)	175
Defined Benefit Pension Items, Amounts reclassified from accumulated other comprehensive income (loss)	153	197
Net of tax amount	(153)	372	211
Defined Benefit Pension Items, Ending Balance	(1,548)	(1,395)	(1,454)
Total, Opening Balance	(6,191)	(670)
Total, Other comprehensive income (loss) before reclassification	18,209	(5,516)
Total, Amounts reclassified from accumulated other comprehensive income (loss)	41	236
Total other comprehensive income (loss), net of tax	18,250	(5,280)	1,717
Total, Ending Balance	$ 12,059	(6,191)	$ (670)
Accounting Standards Update 2018-02
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Other Comprehensive Income (Loss), Available-for-sale Securities Adjustment, Net of Tax		140
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, after Tax		(313)
Other Comprehensive Income Loss, Adjustment, Net of Tax		(173)
Accounting Standards Update 2016-01
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Other Comprehensive Income (Loss), Available-for-sale Securities Adjustment, Net of Tax		(68)
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, after Tax		0
Other Comprehensive Income Loss, Adjustment, Net of Tax		$ (68)

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Parenthetical) - $ / shares	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
Cash dividends declared, per share	$ 1.16	$ 1.00	$ 0.85

FAIR VALUE (Tables)

12 Months Ended

Dec. 31, 2019

FAIR VALUE

Schedule of Assets Measured at Fair Value on a Recurring Basis

The table below presents the balances of assets and liabilities measured at fair value on a recurring basis:


	December 31, 2019
	Fair Value Measurements Using						Assets
(dollars in thousands)	Level 1		Level 2		Level 3		at Fair Value
Assets:
Mortgage-backed securities: residential	$	0	$	288,181	$	0	$	288,181
Mortgage-backed securities: commercial		0		36,972		0		36,972
State and municipal securities		0		282,935		145		283,080
Total Securities		0		608,088		145		608,233
Mortgage banking derivative		0		198		0		198
Interest rate swap derivative		0		7,263		0		7,263
Total assets	$	0	$	615,549	$	145	$	615,694

Liabilities:
Mortgage banking derivative		0		14		0		14
Interest rate swap derivative		0		7,860		0		7,860
Total liabilities	$	0	$	7,874	$	0	$	7,874


	December 31, 2018
	Fair Value Measurements Using						Assets
(dollars in thousands)	Level 1		Level 2		Level 3		at Fair Value
Assets:
U.S. Treasury securities	$	987	$	0	$	0	$	987
U.S. government sponsored agency securities		0		4,350		0		4,350
Mortgage-backed securities: residential		0		325,412		0		325,412
Mortgage-backed securities: commercial		0		38,141		0		38,141
State and municipal securities		0		216,509		150		216,659
Total Securities		987		584,412		150		585,549
Mortgage banking derivative		0		95		0		95
Interest rate swap derivative		0		3,869		0		3,869
Total assets	$	987	$	588,376	$	150	$	589,513

Liabilities:
Mortgage banking derivative		0		23		0		23
Interest rate swap derivative		0		4,025		0		4,025
Total liabilities	$	0	$	4,048	$	0	$	4,048

Schedule of Assets Measured at Fair Value on a Nonrecurring Basis

The tables below present the amount of assets measured at fair value on a nonrecurring basis:


	December 31, 2019
	Fair Value Measurements Using						Assets
(dollars in thousands)	Level 1		Level 2		Level 3		at Fair Value
Assets
Impaired loans:
Commercial and industrial loans:
Working capital lines of credit loans	$	0	$	0	$	3,126	$	3,126
Non-working capital loans		0		0		6,374		6,374
Commercial real estate and multi-family residential loans:
Construction and land development loans		0		0		43		43
Owner occupied loans		0		0		1,449		1,449
Agri-business and agricultural loans:
Loans secured by farmland		0		0		57		57
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		0		0		474		474
Open end and junior lien loans		0		0		587		587
Other consumer loans		0		0		11		11
Total impaired loans	$	0	$	0	$	12,121	$	12,121
Other real estate owned		0		0		0		0
Total assets	$	0	$	0	$	12,121	$	12,121


	December 31, 2018
	Fair Value Measurements Using						Assets
(dollars in thousands)	Level 1		Level 2		Level 3		at Fair Value
Assets
Impaired loans:
Commercial and industrial loans:
Working capital lines of credit loans	$	0	$	0	$	4,092	$	4,092
Non-working capital loans		0		0		4,967		4,967
Commercial real estate and multi-family residential loans:
Construction and land development loans		0		0		148		148
Owner occupied loans		0		0		1,669		1,669
Agri-business and agricultural loans:
Loans secured by farmland		0		0		77		77
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		0		0		553		553
Total impaired loans	$	0	$	0	$	11,506	$	11,506
Other real estate owned		0		0		316		316
Total assets	$	0	$	0	$	11,822	$	11,822

Schedule of Fair Value Measured On Nonrecurring Basis Valuation Techniques

The following table presents the valuation methodology and unobservable inputs for Level 3 assets measured at fair value on a non-recurring basis at December 31, 2019:


(dollars in thousands)	Fair Value		Valuation Methodology	Unobservable Inputs	Average		Range of Inputs
Impaired loans:
Commercial and industrial	$	9,500	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	53	%	1%-100%


Impaired loans:
Commercial real estate		1,492	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	27	%	7%-61%



Impaired loans:
Agribusiness and agricultural		57	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	61	%


Impaired loans:
Consumer 1-4 family mortgage		1,061	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	14	%	5%-100%


Impaired loans:
Other consumer		11	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	36	%

NOTE 5 – FAIR VALUE (continued)

The following table presents the valuation methodology and unobservable inputs for Level 3 assets measured at fair value on a non-recurring basis at December 31, 2018:


(dollars in thousands)	Fair Value		Valuation Methodology	Unobservable Inputs	Average		Range of Inputs
Impaired loans:
Commercial and industrial	$	9,059	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	48	%	4%-100%


Impaired loans:
Commercial real estate		1,817	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	34	%	6%-53%



Impaired loans:
Agribusiness and agricultural		77	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	49	%


Impaired loans:
Consumer 1-4 family mortgage		553	Collateral based measurements	Discount to reflect current market conditions and ultimate collectability	23	%	0%-64%



Other real estate owned		316	Collateral based measurements	Discount to reflect current market conditions	0	%

Schedule of Fair Values and the Related Carrying Values of Financial Instruments

December 31, 2019

Carrying

Estimated Fair Value

(dollars in thousands)

Value

Level 1

Level 2

Level 3

Total

Financial Assets:

Cash and cash equivalents

99,381

96,603

2,778

99,381

Securities available-for-sale

608,233

608,088

145

608,233

Real estate mortgages held-for-sale

4,527

4,614

Loans, net

4,015,176

3,979,006

Federal Reserve and Federal Home Loan Bank Stock

13,772

N/A

Accrued interest receivable

15,391

3,729

11,662

15,391

Financial Liabilities:

Certificates of deposit

(1,192,067)

(1,202,060)

All other deposits

(2,941,752)

Federal Home Loan Bank advances

(170,000)

(169,998)

Standby letters of credit

(915)

Accrued interest payable

(11,604)

(102)

(11,502)

(11,604)


	December 31, 2018
	Carrying		Estimated Fair Value
(dollars in thousands)	Value		Level 1		Level 2		Level 3		Total
Financial Assets:
Cash and cash equivalents	$	216,922	$	214,452	$	2,470	$	0	$	216,922
Securities available-for-sale		585,549		987		584,412		150		585,549
Real estate mortgages held-for-sale		2,293		0		2,314		0		2,314
Loans, net		3,866,292		0		0		3,786,175		3,786,175
Federal Reserve and Federal Home Loan Bank Stock		13,772		N/A		N/A		N/A		N/A
Accrued interest receivable		15,518		3		3,569		11,946		15,518
Financial Liabilities:
Certificates of deposit		(1,419,754)		0		(1,424,553)		0		(1,424,553)
All other deposits		(2,624,311)		(2,624,311)		0		0		(2,624,311)
Securities sold under agreements to repurchase		(75,555)		0		(75,555)		0		(75,555)
Federal Home Loan Bank advances		(170,000)		0		(169,996)		0		(169,996)
Subordinated debentures		(30,928)		0		0		(31,195)		(31,195)
Standby letters of credit		(978)		0		0		(978)		(978)
Accrued interest payable		(10,404)		(110)		(10,289)		(5)		(10,404)

OFFSETTING ASSETS AND LIABILITIES

12 Months Ended

Dec. 31, 2019

OFFSETTING ASSETS AND LIABILITIES

OFFSETTING ASSETS AND LIABILITIES

NOTE 17 – OFFSETTING ASSETS AND LIABILITIES


	December 31, 2019
			Gross
	Gross		Amounts		Net Amounts		Gross Amounts Not
	Amounts of		Offset in the		presented in		Offset in the Statement
	Recognized		Statement of		the Statement		of Financial Position
	Assets/		Financial		of Financial		Financial		Cash Collateral		Net
(dollars in thousands)	Liabilities		Position		Position		Instruments		Position		Amount
Assets
Interest Rate Swap Derivatives	$	7,263	$	0	$	7,263	$	0	$	0	$	7,263
Total Assets	$	7,263	$	0	$	7,263	$	0	$	0	$	7,263
Liabilities
Interest Rate Swap Derivatives	$	7,860	$	0	$	7,860	$	0	$	(7,560)	$	300
Repurchase Agreements		0		0		0		0		0		0
Total Liabilities	$	7,860	$	0	$	7,860	$	0	$	(7,560)	$	300


	December 31, 2018
			Gross
	Gross		Amounts		Net Amounts		Gross Amounts Not
	Amounts of		Offset in the		presented in		Offset in the Statement
	Recognized		Statement of		the Statement		of Financial Position
	Assets/		Financial		of Financial		Financial		Cash Collateral		Net
(dollars in thousands)	Liabilities		Position		Position		Instruments		Position		Amount
Assets
Interest Rate Swap Derivatives	$	3,869	$	0	$	3,869	$	0	$	(760)	$	3,109
Total Assets	$	3,869	$	0	$	3,869	$	0	$	(760)	$	3,109
Liabilities
Interest Rate Swap Derivatives	$	4,025	$	0	$	4,025	$	0	$	(560)	$	3,465
Repurchase Agreements		75,555		0		75,555		(75,555)		0		0
Total Liabilities	$	79,580	$	0	$	79,580	$	(75,555)	$	(560)	$	3,465

If an event of default occurs causing an early termination of an interest rate swap derivative, any early termination amount payable to one party by the other party may be reduced by set-off against any other amount payable by the one party to the other party. If a default in performance of any obligation of a repurchase agreement occurs, each party will set-off property held in respect of transactions against obligations owing in respect of any other transactions.

LEASES

12 Months Ended

Dec. 31, 2019

LEASES

LEASES

NOTE 25 – LEASES

The Company leases certain office facilities under long-term operating lease agreements. The leases expire at various dates through 2029 and some include renewal options. Many of these leases require the payment of property taxes, insurance premiums, maintenance, utilities and other costs. In many cases, rentals are subject to increase in relation to a cost-of-living index. The Company accounts for lease and non-lease components together as a single lease component. The Company determines if an arrangement is a lease at inception. Operating leases are recorded as a right-of-use (“ROU”) lease assets and are included in other assets on the consolidated balance sheet. The Company’s corresponding lease obligations are included in other liabilities on the consolidated balance sheet. ROU lease assets represent the Company’s right to use an underlying asset for the lease term and lease obligations represent the Company’s obligation to make lease payments arising from the lease. Operating ROU lease assets and obligations are recognized at the commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The ROU lease asset also includes any lease payments made and excludes lease incentives. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option.

Lease expense for lease payments is recognized on a straight-line basis over the lease term. Short-term leases are leases having a term of twelve months or less. The Company recognizes short-term leases on a straight-line basis and does not record a related lease asset or liability for such leases, as allowed as practical expedient of the standard. The following is a maturity analysis of the operating lease liabilities as of December 31, 2019:


	Operating Lease
Years ending December 31, (in thousands)	Obligation
2020	$	561
2021		581
2022		595
2023		606
2024		622
2025 and thereafter		2,873
Total undiscounted lease payments		5,838
Less imputed interest		(738)
Lease liability	$	5,100
Right-of-use asset	$	5,100


	Year Ended
	December 31,2019
Lease cost
Operating lease cost	$	498
Short-term lease cost		24
Total lease cost	$	522

Other information
Operating cash outflows from operating leases	$	498
Weighted-average remaining lease term - operating leases		9.8	years
Weighted average discount rate - operating leases		2.8	%

BORROWINGS

12 Months Ended

Dec. 31, 2019

BORROWINGS

BORROWINGS

NOTE 9 – BORROWINGS

For the years ending December 31, advances from the Federal Home Loan Bank were as follows:


(dollars in thousands)	2019		2018
Federal Home Loan Bank of Indianapolis Advance, 1.61%, Due January 7, 2020	$	170,000	$	0
Federal Home Loan Bank of Indianapolis Advance, 2.52%, Due January 7, 2019		0		170,000
Total	$	170,000	$	170,000

The outstanding FHLB advance at December 31, 2019 of $170.0 million is a fixed rate advance and may not be prepaid without penalty. All FHLB notes require monthly interest payments and are secured by residential real estate loans and securities with a carrying value of $453.2 million and $412.9 million at December 31, 2019 and 2018, respectively. At December 31, 2019 and 2018, the Company owned $10.4 million of FHLB stock, which also secures debts owed to the FHLB. The Company is authorized by the Board to borrow up to $800.0 million at the FHLB, but availability is limited to $115.5 million based on collateral and outstanding borrowings. Federal Reserve Discount Window borrowings were secured by commercial loans with a carrying value of $446.9 million and $381.5 million as of December 31, 2019 and 2018. The Company had a borrowing capacity of $339.5 million and $286.5 million at the Federal Reserve Bank as of December 31, 2019 and 2018, respectively. There were no borrowings outstanding at the Federal Reserve Bank at December 31, 2019 and 2018.

The Company had $325.0 million of availability in federal funds lines with twelve correspondent banks, none of which was drawn on as of December 31, 2019 and 2018. The Bank is also a member of the American Financial Exchange (AFX) where overnight fed funds purchased can be obtained from other banks on the Exchange that have approved the Bank for an unsecured, overnight line. These funds are only available if the approving banks have an ‘offer’ out to sell that day. As of December 31, 2019 and 2018, the total amount approved for the Bank via AFX banks was $244.0 million and $119.0 million, respectively. There were no amounts drawn as of December 31, 2019 and 2018.

On August 2, 2019 the Company entered into an unsecured revolving credit agreement with another financial institution allowing the Company to borrow up to $30.0 million. Funds provided under the agreement may be used to repurchase shares of the Company’s common stock under the share repurchase program, which was reauthorized by the Company’s board of directors on January 14, 2020. The credit agreement includes a negative pledge agreement whereby the Company agrees not to pledge or otherwise encumber the stock of the Bank. The credit agreement has a one year term which may be amended, extended, modified or renewed. There was no amount drawn on the line as of December 31, 2019.

NOTE 9 – BORROWINGS (continued)

Securities sold under agreements to repurchase (“repo accounts”) represent collateralized borrowings with customers located primarily within the Company’s service area. The Bank discontinued offering this product in early 2019. All repo accounts at December 31, 2018 matured on demand. Repo accounts are not covered by federal deposit insurance and are secured by securities owned.

The following is a schedule, at the end of the year indicated, of statistical information relating to securities sold under agreement to repurchase secured by either U.S. government agency securities or mortgage-backed securities classified as securities available-for-sale. There were no other categories of short-term borrowings for which the average balance outstanding during the period was 30 percent or more of stockholders' equity at the end of each period.


(dollars in thousands)	2019			2018			2017
Securities sold under agreements to repurchase
Outstanding at year end	$	0		$	75,555		$	70,652
Approximate average interest rate at year end		0.00	%		0.74	%		0.46	%
Highest amount outstanding as of any month end during the year	$	72,814		$	106,239		$	77,886
Approximate average outstanding during the year		15,104			86,874			63,379
Approximate average interest rate during the year		0.86	%		0.58	%		0.39	%

COMMITMENTS, OFF-BALANCE SHEET RISKS AND CONTINGENCIES

12 Months Ended

Dec. 31, 2019

COMMITMENTS, OFF-BALANCE SHEET RISKS AND CONTINGENCIES

COMMITMENTS, OFF-BALANCE SHEET RISKS AND CONTINGENCIES

NOTE 18 – COMMITMENTS, OFF-BALANCE SHEET RISKS AND CONTINGENCIES

During the normal course of business, the Company becomes a party to financial instruments with off-balance sheet risk in order to meet the financing needs of its customers. These financial instruments include commitments to make loans and open-ended revolving lines of credit. Amounts as of the years ended December 31, 2019 and 2018, were as follows:


	2019				2018
	Fixed		Variable		Fixed		Variable
(dollars in thousands)	Rate		Rate		Rate		Rate
Commercial loan lines of credit	$	39,104	$	1,451,704	$	63,625	$	1,337,437
Commercial letters of credit		0		0		0		3,245
Standby letters of credit		0		70,932		0		81,512
Real estate mortgage loans		4,448		1,488		2,811		2,881
Real estate construction mortgage loans		478		2,139		400		2,189
Home equity mortgage open-ended revolving lines		0		247,562		0		232,362
Consumer loan open-ended revolving lines		180		17,116		215		14,468
Total	$	44,210	$	1,790,941	$	67,051	$	1,674,094

The index on variable rate commercial loan commitments is principally the national prime rate. Interest rate ranges on commitments and open-ended revolving lines of credit for years ended December 31, 2019 and 2018, were as follows:


	2019				2018
	Fixed		Variable		Fixed		Variable
	Rate		Rate		Rate		Rate
Commercial loan	0.75-14.50	%	2.65-9.25	%	0.75-14.50	%	2.65-10.00	%
Real estate mortgage loan	3.13-4.00	%	3.75-4.25	%	3.75-6.13	%	3.75-11.00	%
Consumer loan open-ended revolving line	15.00	%	3.88-15.00	%	15.00	%	3.88-15.00	%

Commitments, excluding open-ended revolving lines, generally have fixed expiration dates of one year or less. Open-ended revolving lines are monitored for proper performance and compliance on a monthly basis. Since many commitments expire without being drawn upon, the total commitment amount does not necessarily represent future cash requirements. The Company follows the same credit policy (including requiring collateral, if deemed appropriate) to make such commitments as it follows for those loans that are recorded in its financial statements.

The Company’s exposure to credit losses in the event of nonperformance is represented by the contractual amount of the commitments. Management does not expect any significant losses as a result of these commitments.

DEPOSITS

12 Months Ended

Dec. 31, 2019

DEPOSITS

DEPOSITS

NOTE 8 – DEPOSITS

The following table details total deposits as of December 31, 2019 and 2018:


(dollars in thousands)	2019		2018
Non-interest bearing demand deposits	$	983,307	$	946,838
Savings and transaction accounts:
Savings deposits		234,508		247,903
Interest bearing demand deposits		1,723,937		1,429,570
Time deposits:
Other time deposits		281,934		273,533
Deposits of $100,000 to $250,000		291,805		268,058
Deposits of $250,000 or more		618,328		878,163
Total deposits	$	4,133,819	$	4,044,065

NOTE 8 – DEPOSITS (continued)

At December 31, 2019, the scheduled maturities of time deposits were as follows:


(dollars in thousands)	Amount
Maturing in 2020	$	895,601
Maturing in 2021		206,303
Maturing in 2022		35,181
Maturing in 2023		23,143
Maturing in 2024		29,747
Thereafter		2,092
Total time deposits	$	1,192,067

During 2019 the Bank entered into agreements with Promontory Interfinancial Network relative to their Insured Cash Sweep One-Way Buy program. As of December 31, 2019, the total amount available to the Bank via this program was $200.0 million, of which, $75.1 million was drawn.

RELATED PARTY TRANSACTIONS

12 Months Ended

Dec. 31, 2019

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS

NOTE 14 – RELATED PARTY TRANSACTIONS

Loans to principal officers, directors, and their affiliates as of December 31, 2019 and 2018 were as follows:


(dollars in thousands)	2019		2018
Beginning balance	$	83,546	$	105,242
New loans and advances		55,465		94,542
Effect of changes in related parties		(5,967)		0
Repayments and renewals		(49,064)		(116,238)
Ending balance	$	83,980	$	83,546

Deposits from principal officers, directors, and their affiliates at year-end 2019 were $33.3 million and there were no securities sold under agreements to repurchase. Deposits from principal officers, directors, and their affiliates at year-end 2018 were $12.1 million plus an additional $1.9 million included in securities sold under agreements to repurchase.

CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands	12 Months Ended
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Interest and fees on loans
Taxable	$ 196,733	$ 181,451	$ 150,295
Tax exempt	951	814	729
Interest and dividends on securities
Taxable	8,909	9,717	9,218
Tax exempt	7,127	6,079	5,102
Interest on short-term investments	1,490	909	354
Total interest income	215,210	198,970	165,698
Interest on deposits	57,148	44,913	27,026
Interest on borrowings
Short-term	1,311	1,143	1,446
Long-term	1,704	1,643	1,334
Total interest expense	60,163	47,699	29,806
NET INTEREST INCOME	155,047	151,271	135,892
Provision for loan losses	3,235	6,400	3,000
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES	151,812	144,871	132,892
NONINTEREST INCOME
Wealth advisory fees	6,835	6,344	5,481
Investment brokerage fees	1,687	1,458	1,273
Service charges on deposit accounts	15,717	15,831	13,696
Loan and service fees	9,911	9,291	7,900
Merchant and interchange fee income	2,641	2,461	2,279
Bank owned life insurance income	1,890	1,244	1,768
Mortgage banking income	1,626	1,150	982
Net securities gains (losses)	142	(50)	32
Other income	4,548	2,573	2,629
Total noninterest income	44,997	40,302	36,040
NONINTEREST EXPENSE
Salaries and employee benefits	49,434	48,353	45,306
Net occupancy expense	5,295	5,149	4,595
Equipment costs	5,521	5,243	4,629
Data processing fees and supplies	10,407	9,685	8,233
Corporate and business development	4,371	5,066	4,744
FDIC insurance and other regulatory fees	638	1,701	1,798
Professional fees	4,644	3,798	3,574
Other expense	9,114	7,234	6,419
Total noninterest expense	89,424	86,229	79,298
INCOME BEFORE INCOME TAX EXPENSE	107,385	98,944	89,634
Income tax expense	20,338	18,533	32,304
NET INCOME	$ 87,047	$ 80,411	$ 57,330
BASIC WEIGHTED AVERAGE COMMON SHARES	25,588,404	25,288,533	25,181,208
BASIC EARNINGS PER COMMON SHARE	$ 3.40	$ 3.18	$ 2.28
DILUTED WEIGHTED AVERAGE COMMON SHARES	25,758,893	25,727,831	25,663,381
DILUTED EARNINGS PER COMMON SHARE	$ 3.38	$ 3.13	$ 2.23

SECURITIES - Available Sale Of Securities By Maturity (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Maturities of Available-for-sale Debt Securities
Amortized Cost, Due in one year or less	$ 4,587
Amortized Cost, Due after one year through five years	15,115
Amortized Cost, Due after five years through ten years	24,962
Amortized Cost, Due after ten years	225,816
Amortized Cost, Available for sale securities with maturities amortized cost	270,480
Amortized Cost, Mortgage-backed securities	320,529
Amortized Cost, Total debt securities	591,009	$ 591,621
Fair Value, Due in one year or less	4,610
Fair Value, Due after one year through five years	15,453
Fair Value, Due after five years through ten years	26,061
Fair Value, Due after ten years	236,956
Fair Value, Available for sale securities with maturities fair value	283,080
Fair Value, Mortgage-backed securities	325,153
Fair Value, Total debt securities	$ 608,233	$ 585,549

PARENT COMPANY STATEMENTS - CONDENSED BALANCE SHEETS (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
ASSETS
Other assets	$ 41,293	$ 34,735
Total assets	4,946,745	4,875,254
LIABILITIES
Subordinated debt	0	30,928
STOCKHOLDERS' EQUITY	598,011	521,615
Total liabilities and equity	4,946,745	4,875,254
Parent Company [Member] \| Reportable Legal Entities [Member]
ASSETS
Deposits with Lake City Bank	1,762	1,283
Deposits with other depository institutions	2,104	7,613
Cash	3,866	8,896
Investments in banking subsidiary	582,674	533,442
Investments in other subsidiaries	3,276	3,992
Other assets	8,457	6,468
Total assets	598,273	552,798
LIABILITIES
Dividends payable and other liabilities	262	255
Subordinated debt	0	30,928
STOCKHOLDERS' EQUITY	598,011	521,615
Total liabilities and equity	$ 598,273	$ 552,798

ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY - Loans By Class Modified As Troubled Debt Restructuring (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
Modified Repayment Terms
Troubled Debt Restructurings Modified During Period [Abstract]
Number of Loans	1	12	8
Extension period for modified repayment terms	1 month
Modified Repayment Terms \| Minimum
Troubled Debt Restructurings Modified During Period [Abstract]
Extension period for modified repayment terms		0 months	0 months
Modified Repayment Terms \| Maximum
Troubled Debt Restructurings Modified During Period [Abstract]
Extension period for modified repayment terms		239 months	350 months
All Modifications
Troubled Debt Restructurings Modified During Period [Abstract]
Number of Loans	1	12	8
Pre-Modification Outstanding Recorded Investment	$ 35	$ 7,183	$ 3,852
Post-Modification Outstanding Recorded Investment	$ 35	$ 7,182	$ 3,854
Commercial and Industrial Loans \| Working capital lines of credit loans \| Modified Repayment Terms
Troubled Debt Restructurings Modified During Period [Abstract]
Number of Loans	1	1	1
Extension period for modified repayment terms	1 month	0 months	9 months
Commercial and Industrial Loans \| Working capital lines of credit loans \| All Modifications
Troubled Debt Restructurings Modified During Period [Abstract]
Number of Loans	1	1	1
Pre-Modification Outstanding Recorded Investment	$ 35	$ 600	$ 1,324
Post-Modification Outstanding Recorded Investment	$ 35	$ 600	$ 1,324
Commercial and Industrial Loans \| Non-working capital loans \| Modified Repayment Terms
Troubled Debt Restructurings Modified During Period [Abstract]
Number of Loans		7
Commercial and Industrial Loans \| Non-working capital loans \| Modified Repayment Terms \| Minimum
Troubled Debt Restructurings Modified During Period [Abstract]
Extension period for modified repayment terms		0 months	0 months
Commercial and Industrial Loans \| Non-working capital loans \| Modified Repayment Terms \| Maximum
Troubled Debt Restructurings Modified During Period [Abstract]
Extension period for modified repayment terms		6 months	6 months
Commercial and Industrial Loans \| Non-working capital loans \| All Modifications
Troubled Debt Restructurings Modified During Period [Abstract]
Number of Loans		7	4
Pre-Modification Outstanding Recorded Investment		$ 4,628	$ 1,922
Post-Modification Outstanding Recorded Investment		$ 4,628	$ 1,922
Commercial Real Estate and Multi-family Residential Loans \| Owner occupied loans \| Modified Repayment Terms
Troubled Debt Restructurings Modified During Period [Abstract]
Number of Loans		2	1
Extension period for modified repayment terms		12 months	6 months
Commercial Real Estate and Multi-family Residential Loans \| Owner occupied loans \| All Modifications
Troubled Debt Restructurings Modified During Period [Abstract]
Number of Loans		2	1
Pre-Modification Outstanding Recorded Investment		$ 933	$ 486
Post-Modification Outstanding Recorded Investment		$ 933	$ 486
Commercial Real Estate and Multi-family Residential Loans \| Construction and land development loans \| Modified Repayment Terms
Troubled Debt Restructurings Modified During Period [Abstract]
Number of Loans		1
Extension period for modified repayment terms		12 months
Commercial Real Estate and Multi-family Residential Loans \| Construction and land development loans \| All Modifications
Troubled Debt Restructurings Modified During Period [Abstract]
Number of Loans		1
Pre-Modification Outstanding Recorded Investment		$ 824
Post-Modification Outstanding Recorded Investment		$ 824
Consumer 1-4 Family Mortgage Loans \| Closed end first mortgage loans \| Modified Repayment Terms
Troubled Debt Restructurings Modified During Period [Abstract]
Number of Loans		1	2
Extension period for modified repayment terms		239 months
Consumer 1-4 Family Mortgage Loans \| Closed end first mortgage loans \| Modified Repayment Terms \| Minimum
Troubled Debt Restructurings Modified During Period [Abstract]
Extension period for modified repayment terms			198 months
Consumer 1-4 Family Mortgage Loans \| Closed end first mortgage loans \| Modified Repayment Terms \| Maximum
Troubled Debt Restructurings Modified During Period [Abstract]
Extension period for modified repayment terms			350 months
Consumer 1-4 Family Mortgage Loans \| Closed end first mortgage loans \| All Modifications
Troubled Debt Restructurings Modified During Period [Abstract]
Number of Loans		1	2
Pre-Modification Outstanding Recorded Investment		$ 198	$ 120
Post-Modification Outstanding Recorded Investment		$ 197	$ 122

PENSION AND OTHER POSTRETIREMENT PLANS

12 Months Ended

Dec. 31, 2019

OTHER BENEFIT PLANS

PENSION AND OTHER POSTRETIREMENT PLANS

NOTE 11 – PENSION AND OTHER POSTRETIREMENT PLANS

In April 2000, the Lakeland Financial Corporation Pension Plan was frozen. The Company also maintains a Supplemental Executive Retirement Plan (“SERP”) for select officers that was established as a funded, non-qualified deferred compensation plan. Currently, six retired officers are the only participants in the SERP. The measurement date for both the pension plan and SERP is December 31, 2019 and 2018.

Information as to the Company’s employee benefit plans at December 31, 2019 and 2018 is as follows:


	Pension Benefits				SERP Benefits
(dollars in thousands)	2019		2018		2019		2018
Change in benefit obligation:
Beginning benefit obligation	$	2,118	$	2,862	$	924	$	1,086
Interest cost		87		93		37		34
Actuarial (gain) loss		631		(325)		164		(62)
Benefits paid		(121)		(512)		(134)		(134)
Ending benefit obligation		2,715		2,118		991		924

Change in plan assets (primarily equity and fixed income investments and money market funds), at fair value:
Beginning plan assets		2,151		2,356		885		1,047
Actual return		415		(61)		163		(28)
Employer contribution		27		368		0		0
Benefits paid		(121)		(512)		(134)		(134)
Ending plan assets		2,472		2,151		914		885
Funded status at end of year	$	(243)	$	33	$	(77)	$	(39)

Amounts recognized in the consolidated balance sheets consist of:


	Pension Benefits				SERP Benefits
(dollars in thousands)	2019		2018		2019		2018
Funded status included in other liabilities	$	(243)	$	33	$	(77)	$	(39)

Amounts recognized in accumulated other comprehensive income (loss) consist of:


	Pension Benefits				SERP Benefits
(dollars in thousands)	2019		2018		2019		2018
Net actuarial loss	$	1,464	$	1,242	$	597	$	615

The accumulated benefit obligation for the pension plan was $2.7 million and $2.1 million for December 31, 2019 and 2018, respectively. The accumulated benefit obligation for the SERP was $1.0 million and $900,000 for December 31, 2019 and 2018, respectively.

NOTE 11 – PENSION AND OTHER POSTRETIREMENT PLANS (continued)

Net period benefit cost and other amounts recognized in other comprehensive income (loss) include the following:


	Pension Benefits						SERP Benefits
(dollars in thousands)	2019		2018		2017		2019		2018		2017
Net pension expense:
Service cost	$	0	$	0	$	0	$	0	$	0	$	0
Interest cost		87		93		104		37		34		40
Expected return on plan assets		(137)		(138)		(143)		(55)		(61)		(63)
Recognized net actuarial loss		132		193		185		73		73		80
Settlement cost		0		224		0		0		0		0
Net pension expense	$	82	$	372	$	146	$	55	$	46	$	57

Net (gain) loss	$	353	$	(296)	$	(36)	$	56	$	27	$	(61)
Amortization of net loss		(132)		(193)		(185)		(73)		(73)		(80)
Total recognized in other comprehensive income (loss)		221		(489)		(221)		(17)		(46)		(141)
Total recognized in net pension expense and other comprehensive income (loss)	$	303	$	(117)	$	(75)	$	38	$	0	$	(84)

The estimated net loss (gain) for the defined benefit pension plan and SERP that will be amortized from accumulated other comprehensive income (loss) into net periodic benefit cost over the next fiscal year is $172,000 for the pension plan and $80,000 for the SERP. The settlement costs in 2018 were related to participants taking lump sum distributions from the pension plan during those years.

For 2019, 2018 and 2017, the assumed form of payment elected by active participants upon retirement was a lump sum to reflect participant trends. The lump sum assumed interest rates, below, for December 31, 2019, 2018 and 2017 reflect the mortality table in effect for 2019, 2018 and 2017, respectively. For 2019, the mortality assumption was changed to the PRI-2012 White Collar Mortality Table, with full generational Projection Scale MP-2019 as of December 31, 2019, to reflect improved mortality expectations. For 2018, the mortality assumption was changed to the RP-2014 Mortality Table, adjusted to 2006, with full generational Projection Scale MP-2018 as of December 31, 2018, to reflect improved mortality expectations. For 2017, the mortality assumption was changed to the RP-2014 Mortality Table, adjusted to 2006, with full generational Projection Scale MP-2017 as of December 31, 2017, to reflect improved mortality expectations.


	Pension Benefits						SERP Benefits
	2019		2018		2017		2019		2018		2017
The following assumptions were used in calculating the net benefit obligation:

Weighted average discount rate	2.98	%	4.08	%	3.46	%	2.98	%	4.08	%	3.46	%
Rate of increase in future compensation	N/A		N/A		N/A		N/A		N/A		N/A
Lump sum assumed interest rates
First 5 years	2.01	%	3.33	%	2.05	%	N/A		N/A		N/A
Next 15 years	3.06	%	4.39	%	3.61	%	N/A		N/A		N/A
All future years	3.65	%	4.72	%	4.27	%	N/A		N/A		N/A

The following assumptions were used in calculating the net pension expense:

Weighted average discount rate	4.08	%	3.46	%	3.86	%	4.08	%	3.46	%	3.86	%
Rate of increase in future compensation	N/A		N/A		N/A		N/A		N/A		N/A
Expected long-term rate of return	6.50	%	6.50	%	6.50	%	6.50	%	6.50	%	6.50	%

NOTE 11 – PENSION AND OTHER POSTRETIREMENT PLANS (continued)

Pension Plan and SERP Assets

The Company's investment strategies are to invest in a prudent manner for the purpose of providing benefits to participants in the pension plan and the SERP. The investment strategies are targeted to maximize the total return of the portfolio net of inflation, spending and expenses. Risk is controlled through diversification of asset types and investments in domestic and international equities and fixed income securities. The target allocations for plan assets are shown in the tables below. Equity securities primarily include investments in common stocks. Debt securities include government agency and commercial bonds. Other investments consist of money market mutual funds.

The weighted average expected long-term rate of return on pension plan and SERP assets is developed in consultation with the plans actuary. It is primarily based upon industry trends and consensus rates of return which are then adjusted to reflect the specific asset allocations and historical rates of return of the Company's plan assets. The following assumptions were used in determining the total long term rate of return: equity securities were assumed to have a long-term rate of return of approximately 8.85% and debt securities were assumed to have a long-term rate of return of approximately 3.0%. These rates of return were adjusted to reflect an approximate target allocation of 60% equity securities and 40% debt securities with a small downward adjustment due to investments in the “Other” category, which consist of low yielding money market mutual funds.

Certain asset types and investment strategies are prohibited including, the investment in commodities, options, futures, short sales, margin transactions and non-marketable securities.

The Company's pension plan asset allocation at year-end 2019 and 2018, target allocation for 2020, and expected long-term rate of return by asset category are as follows:


			Percentage of Plan				Weighted
	Target		Assets				Average Expected
	Allocation		at Year End				Long-Term Rate
Asset Category	2020		2019		2018		of Return
Equity securities	55-65	%	61	%	59	%	8.85	%
Debt securities	35-45	%	36	%	40	%	3.00	%
Other	5-10	%	3	%	1	%	0.10	%
Total			100	%	100	%	6.50	%

The Company’s SERP plan asset allocation at year-end 2019 and 2018, target allocation for 2020, and expected long-term rate of return by asset category are as follows:


			Percentage of Plan				Weighted
	Target		Assets				Average Expected
	Allocation		at Year End				Long-Term Rate
Asset Category	2020		2019		2018		of Return
Equity securities	55-65	%	65	%	58	%	8.85	%
Debt securities	35-45	%	34	%	40	%	3.00	%
Other	5-10	%	1	%	2	%	0.10	%
Total			100	%	100	%	6.50	%

NOTE 11 – PENSION AND OTHER POSTRETIREMENT PLANS (continued)

Fair Value of Pension Plan and SERP Assets

Fair value is the exchange price that would be received for an asset in the principal or most advantageous market for the asset in an orderly transaction between market participants on the measurement date. Also a fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

The Company used the following methods and significant assumptions to estimate the fair value of each type of financial instrument:

Equity and debt securities: The fair values of securities are determined on a recurring basis by obtaining quoted prices on nationally recognized securities exchanges (Level 1 inputs) or pricing models, which utilize significant observable inputs such as matrix pricing. This is a mathematical technique widely used in the industry to value debt securities without relying exclusively on quoted prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted securities (Level 2 inputs).

The fair values of the Company’s pension plan assets at December 31, 2019, by asset category are as follows:


			Quoted Prices
			in Active		Significant		Significant
			Markets for		Observable		Unobservable
			Identical Assets		Inputs		Inputs
Asset Category	Total		(Level 1)		(Level 2)		(Level 3)
(dollars in thousands)
Equity securities - US large cap common stocks	$	912	$	912	$	0	$	0
Equity securities - US mid cap stock mutual funds		115		115		0		0
Equity securities - US small cap stock mutual funds		119		119		0		0
Equity securities - international stock mutual funds		257		257		0		0
Equity securities - emerging markets stock mutual funds		111		111		0		0
Debt securities - intermediate term bond mutual funds		402		402		0		0
Debt securities - short term bond mutual funds		480		480		0		0
Cash - money market account		74		74		0		0
Total	$	2,470	$	2,470	$	0	$	0

Total pension plan assets available for benefits also include $2,000 in accrued interest and dividend income.

The fair values of the Company’s pension plan assets at December 31, 2018, by asset category are as follows:


			Quoted Prices
			in Active		Significant		Significant
			Markets for		Observable		Unobservable
			Identical Assets		Inputs		Inputs
Asset Category	Total		(Level 1)		(Level 2 )		(Level 3)
(dollars in thousands)
Equity securities - US large cap common stocks	$	784	$	784	$	0	$	0
Equity securities - US mid cap stock mutual funds		107		107		0		0
Equity securities - US small cap stock mutual funds		114		114		0		0
Equity securities - international stock mutual funds		225		225		0		0
Equity securities - emerging markets stock mutual funds		49		49		0		0
Debt securities - intermediate term bond mutual funds		309		309		0		0
Debt securities - short term bond mutual funds		543		543		0		0
Cash - money market account		17		17		0		0
Total	$	2,148	$	2,148	$	0	$	0

NOTE 11 – PENSION AND OTHER POSTRETIREMENT PLANS (continued)

Total pension plan assets available for benefits also include $3,000 in accrued interest and dividend income.

There were no Level 2 or 3 securities during either year.

The fair values of the Company’s SERP assets at December 31, 2019, by asset category are as follows:


			Quoted Prices
			in Active		Significant		Significant
			Markets for		Observable		Unobservable
			Identical Assets		Inputs		Inputs
Asset Category	Total		(Level 1)		(Level 2 )		(Level 3)
(dollars in thousands)
Equity securities - US large cap common stocks	$	353	$	353	$	0	$	0
Equity securities - US mid cap stock mutual funds		46		46		0		0
Equity securities - US small cap stock mutual funds		47		47		0		0
Equity securities - emerging markets stock mutual funds		43		43		0		0
Equity securities - international stock mutual funds		100		100		0		0
Debt securities - intermediate term bond mutual funds		156		156		0		0
Debt securities - short term bond mutual funds		155		155		0		0
Cash - money market account		13		13		0		0
Total	$	913	$	913	$	0	$	0

Total SERP plan assets available for benefits also include $1,000 in accrued interest and dividend income.

The fair values of the Company's SERP assets at December 31, 2018, by asset category are as follows:


			Quoted Prices
			in Active		Significant		Significant
			Markets for		Observable		Unobservable
			Identical Assets		Inputs		Inputs
Asset Category	Total		(Level 1)		(Level 2)		(Level 3)
(dollars in thousands)
Equity securities - US large cap common stocks	$	322	$	322	$	0	$	0
Equity securities - US mid cap stock mutual funds		43		43		0		0
Equity securities - US small cap stock mutual funds		43		43		0		0
Equity securities - emerging markets stock mutual funds		18		18		0		0
Equity securities - international stock mutual funds		89		89		0		0
Debt securities - intermediate term bond mutual funds		123		123		0		0
Debt securities - short term bond mutual funds		231		231		0		0
Cash - money market account		15		15		0		0
Total	$	884	$	884	$	0	$	0

Total SERP plan assets available for benefits also include $1,000 in accrued interest and dividend income.

There were no Level 2 or 3 securities during either year.

Contributions

The Company does not expect to contribute to its pension or SERP plans in 2020.

NOTE 11 – PENSION AND OTHER POSTRETIREMENT PLANS (continued)

Estimated Future Benefit Payments

The following benefit payments are expected to be paid over the next ten years:


	Pension		SERP
Plan Year	Benefits		Benefits
(dollars in thousands)
2020	$	259	$	132
2021		220		126
2022		228		120
2023		205		112
2024		202		103
2025-2029		870		364

SECURITIES - Available Sale Of Securities Continuous Unrealized Loss Position (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Securities with unrealized losses
Less than 12 months, Fair Value	$ 42,215	$ 37,848
12 months or more, Fair value	14,174	346,642
Total Fair value	56,389	384,490
Less than 12 Months, Unrealized Losses	342	136
12 Months or more, Unrealized Losses	275	8,731
Total Unrealized Losses	617	8,867
US Treasury Securities
Securities with unrealized losses
Less than 12 months, Fair Value		0
12 months or more, Fair value		987
Total Fair value		987
Less than 12 Months, Unrealized Losses		0
12 Months or more, Unrealized Losses		7
Total Unrealized Losses		7
US Government Sponsored Agencies
Securities with unrealized losses
Less than 12 months, Fair Value		0
12 months or more, Fair value		4,350
Total Fair value		4,350
Less than 12 Months, Unrealized Losses		0
12 Months or more, Unrealized Losses		85
Total Unrealized Losses		85
Mortgage-backed securities residential
Securities with unrealized losses
Less than 12 months, Fair Value	23,436	11,619
12 months or more, Fair value	14,174	217,182
Total Fair value	37,610	228,801
Less than 12 Months, Unrealized Losses	112	12
12 Months or more, Unrealized Losses	275	5,484
Total Unrealized Losses	387	5,496
Mortgage-backed securities commercial
Securities with unrealized losses
Less than 12 months, Fair Value	4,591	0
12 months or more, Fair value	0	38,141
Total Fair value	4,591	38,141
Less than 12 Months, Unrealized Losses	2	0
12 Months or more, Unrealized Losses	0	571
Total Unrealized Losses	2	571
State and Municipal Securities
Securities with unrealized losses
Less than 12 months, Fair Value	14,188	26,229
12 months or more, Fair value	0	85,982
Total Fair value	14,188	112,211
Less than 12 Months, Unrealized Losses	228	124
12 Months or more, Unrealized Losses	0	2,584
Total Unrealized Losses	$ 228	$ 2,708

EARNINGS PER SHARE

12 Months Ended

Dec. 31, 2019

EARNINGS PER SHARE

EARNINGS PER SHARE

NOTE 20 – EARNINGS PER SHARE

Following are the factors used in the earnings per share computations:


(dollars in thousand except share and per share data)	2019		2018		2017
Basic earnings per common share:
Net income	$	87,047	$	80,411	$	57,330
Weighted-average common shares outstanding		25,588,404		25,288,533		25,181,208
Basic earnings per common share	$	3.40	$	3.18	$	2.28
Diluted earnings per common share:
Net income	$	87,047	$	80,411	$	57,330
Weighted-average common shares outstanding for basic earnings per common share		25,588,404		25,288,533		25,181,208
Add: Dilutive effect of assumed exercise of warrant		0		225,831		219,273
Add: Dilutive effect of assumed exercises of stock options and awards		170,489		213,467		262,900
Average shares and dilutive potential common shares		25,758,893		25,727,831		25,663,381
Diluted earnings per common share	$	3.38	$	3.13	$	2.23

There were no antidilutive stock options for 2019, 2018 and 2017.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Dec. 31, 2019

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations and Principles of Consolidation:

The consolidated financial statements include Lakeland Financial Corporation (the “Holding Company”) and its wholly-owned subsidiaries, Lake City Bank (the “Bank”) and LCB Risk Management, Inc., together referred to as (the “Company”). On December 18, 2006, LCB Investments II, Inc. was formed as a wholly owned subsidiary of the Bank incorporated in Nevada to manage a portion of the Bank’s investment portfolio beginning in 2007. On December 21, 2006, LCB Funding, Inc., a real estate investment trust incorporated in Maryland, was formed as a wholly owned subsidiary of LCB Investments II, Inc. On December 28, 2012, LCB Risk Management, Inc., a captive insurance company incorporated in Nevada, was formed as a wholly owned subsidiary of the Holding Company. All intercompany transactions and balances are eliminated in consolidation.

The Company provides financial services through the Bank, a full-service commercial bank with 50 branch offices in fifteen counties in Northern and Central Indiana. The Company provides commercial, retail, trust and investment services to its customers. Commercial products include commercial loans and technology-driven solutions to meet commercial customers’ treasury management needs such as internet business banking and on-line treasury management services. Retail banking clients are provided a wide array of traditional retail banking services, including lending, deposit and investment services. Retail lending programs are focused on mortgage loans, home equity lines of credit and traditional retail installment loans. The Company provides credit card services to retail and commercial customers through its retail card program and merchant processing activity. The Company provides wealth advisory and trust clients with traditional personal and corporate trust services. The Company also provides retail brokerage services, including an array of financial and investment products such as annuities and life insurance. Other financial instruments, which represent potential concentrations of credit risk, include deposit accounts in other financial institutions.

Use of Estimates:

To prepare financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”), management makes estimates and assumptions based on available information. These estimates and assumptions affect the amounts reported in the financial statements and the disclosures provided and future results could differ.

Cash Flows:

Cash and cash equivalents include cash, demand deposits in other financial institutions and short-term investments and certificates of deposit with maturities of 90 days or less. Cash flows are reported net for customer loan and deposit transactions, and short-term borrowings.

Securities:

Securities are classified as available-for-sale when they might be sold before maturity. Securities available-for-sale are carried at fair value, with unrealized holding gains and losses reported in other comprehensive income (loss), net of tax. Securities are classified as held-to-maturity and carried at amortized cost when management has the positive intent and ability to hold them to maturity.

Purchase premiums or discounts are recognized in interest income using the interest method over the terms of the securities or overestimated lives for mortgage-backed securities. Gains and losses on sales are based on the amortized cost of the security sold and recorded on the trade date. For securities in an unrealized loss position, management considers the extent and duration of the unrealized loss, and the financial condition and near-term prospects of the issuer. Management also assesses whether it intends to sell, or it is more likely than not that it will be required to sell, a security in an unrealized loss position before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the entire difference between amortized cost and fair value is recognized as impairment through earnings. For debt securities that do not meet the aforementioned criteria, the amount of impairment is split into two components as follows: 1) other-than-temporary impairment (OTTI) related to credit loss, which must be recognized in the income statement and 2) OTTI related to other factors, which is recognized in other comprehensive income. The credit loss is defined as the difference between the present value of the cash flows expected to be collected and the amortized cost basis. Equity securities which are included in other assets, are carried at fair value with changes in fair value recorded through earnings.

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Real Estate Mortgage Loans Held-for-Sale:

Loans held for sale are reported at the lower of cost or fair value on an aggregate basis. Net unrealized losses, if any, are recorded as a valuation allowance and charged to earnings.

Loan sales occur on the delivery date agreed to in the relevant commitment agreement. The Company retains servicing on the majority of loans sold. The carrying value of loans sold is reduced by the amount allocated to the servicing right. The gain or loss on the sale of loans is the difference between the carrying value of the loans sold and the funds received from the sale.

Loans:

Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are reported at the principal balance outstanding, net of unearned interest, deferred loan fees and costs, and an allowance for loan losses.

Interest income is reported on the interest method and includes amortization of net deferred loan fees and costs over the loan term. All classes of commercial and industrial, commercial real estate and multi-family residential, agri-business and agricultural, other commercial and consumer 1-4 family mortgage loans for which collateral is insufficient to cover all principal and accrued interest are reclassified as nonaccrual loans, on or before the date when the loan becomes 90 days delinquent. When a loan is classified as a nonaccrual loan, interest on the loan is no longer accrued, all unpaid accrued interest is reversed and interest income is subsequently recorded on the cash-basis or cost-recovery method. Accrual status is resumed when all contractually due payments are brought current and future payments are reasonably assured. Other consumer loans are not placed on a nonaccrual status since these loans are charged-off when they have been delinquent from 90 to 180 days, and when the related collateral, if any, is not sufficient to offset the indebtedness. Nonaccrual loans and loans past due 90 days still on accrual include both smaller balance homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans.

The recorded investment in loans is the loan balance net of unamortized deferred loan fees and costs. The total amount of accrued interest on loans as of December 31, 2019 and 2018 was $11.5 million and $11.8 million.

Allowance for Loan Losses:

The allowance for loan losses is a valuation allowance for probable incurred credit losses. Loan losses are charged against the allowance when management believes the inability to fully collect a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance. The Company has an established process to determine the adequacy of the allowance for loan losses that generally includes consideration of the following factors: changes in the nature and volume of the loan portfolio, overall portfolio quality and current economic conditions that may affect the borrowers’ ability to repay. Consideration is not limited to these factors, although they represent the most commonly cited factors. This evaluation is inherently subjective, as it requires estimates that are susceptible to significant revision as more information becomes available or as future events change. Allocations of the allowance may be made for specific loans, but the entire allowance is available for any loan that, in management’s judgment, should be charged-off.

The allowance consists of specific and general components. The specific component relates to loans that are individually classified as impaired. The general component covers non-impaired loans and is based on historical loss experience, subject to a floor, adjusted for current factors. A detailed analysis is performed on loans that are classified but determined not to be impaired which incorporates different scenarios where the risk that the borrower will be unable or unwilling to repay its debt in full or on time is combined with an estimate of loss in the event the borrower cannot pay to develop non-specific allocations for such loan pools. The historical loss experience is determined by portfolio segment and is based on the actual loss history experienced by the Company over the most recent three years, subject to a floor. This loss experience is supplemented with other environmental factors based on the risks present for each portfolio segment. These factors include consideration of the following: levels of, and trends in, delinquencies and impaired loans; trends in volume and terms of loans; effects of any changes in risk selection and underwriting standards; other changes in lending policies, procedure, and practices; experience, ability, and depth of lending management and other relevant staff; national and local economic trends and conditions; industry conditions; and effects of changes in credit concentrations. The following portfolio segments have been identified: commercial and industrial, commercial real estate and multi-family residential, agri-business and agricultural, other commercial, consumer 1-4 family mortgage and other consumer. The risk characteristics of each of the identified portfolio segments are as follows:

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Commercial and Industrial – Borrowers may be subject to industry conditions including decreases in product demand; increases in material or other production costs that cannot be immediately recaptured in the sales or distribution cycle; interest rate increases that could have an adverse impact on profitability; non-payment of credit that has been extended under normal vendor terms for goods sold or services; and interruption related to the importing or exporting of production materials or sold products.

Commercial Real Estate and Multi-Family Residential – Borrowers may be subject to potential adverse market conditions that cause a decrease in market value or lease rates; the potential for environmental impairment from events occurring on subject or neighboring properties; and obsolescence in location or function. Multi-Family Residential is also subject to adverse market conditions associated with a change in governmental or personal funding sources for tenants; over supply of units in a specific region; a shift in population; and reputational risks. Construction and Land Development risks include slower absorption than anticipated on speculative projects; deterioration in market conditions that may impact a project’s value; unforeseen costs not considered in the original construction budget; or any other factors that may impact the completion or success of the project.

Agri-business and Agricultural – Borrowers may be subject to adverse market or weather conditions including changes in local or foreign demand; lower yields than anticipated; political or other impact on storage, distribution or use; foreign trade policies, including tariffs; and exposure to increasing commodity prices which result in higher production, distribution or exporting costs.

Other Commercial – Borrowers may be subject to the uninterrupted flow of funds to states and other political subdivisions for the purpose of debt repayments on loans held by the Bank.

Consumer 1-4 Family Mortgage – Borrowers may be subject to adverse employment conditions in the local economy leading to increased default rates; decreased market values from oversupply in a geographic area; and impact to borrowers’ ability to maintain payments in the event of incremental rate increases on adjustable rate mortgages.

Other Consumer – Borrowers may be subject to adverse employment conditions in the local economy which may lead to higher default rates; and decreases in the value of underlying collateral.

A loan is impaired when, based on current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. Loans, for which the terms have been modified and a concession has been granted for borrowers experiencing financial difficulties, are considered troubled debt restructurings and classified as impaired and may be either accruing or non-accruing. Nonaccrual troubled debt restructurings follow the same policy as described above for other loans. Impairment for troubled debt restructurings is measured at the present value of estimated future cash flows using the loan’s effective rate at inception or at discounted collateral value for collateral dependent loans. Impairment is evaluated individually or in total for smaller-balance loans of similar nature such as all classes of consumer 1-4 family and other consumer loans, and individually for all classes of commercial and industrial, commercial real estate and multi-family, agri-business and agricultural and other commercial loans. The Company analyzes commercial loans individually by classifying the loans as to credit risk. This analysis is performed on a quarterly basis for Special Mention, Substandard and Doubtful grade loans and annually on Pass grade loans over $250,000. Factors considered by management in determining impairment include payment status, collateral value and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed. If a loan is impaired, a portion of the allowance may be allocated so that the loan is reported, net, at the present value of estimated future cash flows using the loan’s existing rate or at the fair value of collateral less anticipated costs to sell if repayment is expected solely from the collateral. All classes of commercial and industrial, commercial real estate and multifamily residential, agri-business and agricultural, other commercial and consumer 1-4 family mortgage loans that become delinquent beyond 90 days are analyzed and a charge-off is taken when it is determined that the underlying collateral, if any, is not sufficient to offset the indebtedness.

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Troubled debt restructured loans are considered for removal from troubled debt restructuring status in the year following modification or at time of subsequent restructuring for loans with cumulative principal forgiveness if the interest rate is considered a market rate at the time of modification and it has been performing according to the terms of the modification for a reasonable period of time long enough to observe an ability to repay under the modified terms. If removed from troubled debt restructuring status, the loan continues to be evaluated for impairment with either the present value of estimated future cash flows using the loan’s effective rate at inception or at discounted collateral value for collateral dependent loans. In addition, troubled debt restructured loans with subsequent modifications that do not have cumulative principal forgiveness are considered for removal from troubled debt restructuring status at the time of the subsequent modification if the following circumstances exist: (1) at the time of the subsequent restructuring, the borrower is not experiencing financial difficulties; (2) under the terms of the subsequent restructuring agreement no concession has been granted to the borrower; and (3) the subsequent restructuring agreement includes market terms that are no less favorable than those that would be offered for comparable new debt. Upon meeting these criteria, the loan is no longer individually evaluated for impairment and is no longer disclosed as a troubled debt restructuring.

Investments in Limited Partnerships:

The Company enters into and invests in limited partnerships in order to invest in affordable housing projects for the primary purpose of obtaining available tax benefits. The Company is a limited partner in these investments and, as such, the Company is not involved in the management or operation of such investments. These investments are accounted for using the equity method of accounting. Under the equity method of accounting, the Company records its share of the partnership’s earnings or losses in its income statement and adjusts the carrying amount of the investments on the consolidated balance sheet. These investments are evaluated for impairment when events indicate the carrying amount may not be recoverable. The investments recorded at December 31, 2019 and 2018 were $6.7 million and $7.0 million, respectively and are included with other assets in the consolidated balance sheet. The Company also has a commitment to fund an additional $1.6 million at December 31, 2019 in two of the limited partnerships compared to $2.1 million at December 31, 2018, which is included with other liabilities in the consolidated balance sheet.

Foreclosed Assets:

Assets acquired through loan foreclosure are initially recorded at fair value less costs to sell when acquired, establishing a new cost basis. These assets are subsequently accounted for at lower of cost or fair value less estimated costs to sell. If fair value declines, a valuation allowance is recorded through expense. Costs incurred after acquisition are expensed. At December 31, 2019 and 2018, the balance of other real estate owned was $316,000 and is included with other assets on the consolidated balance sheet.

Land, Premises and Equipment, Net:

Land is carried at cost. Premises and equipment are stated at cost less accumulated depreciation. Depreciation is computed on the straight-line method over the useful lives of the assets. Premises and improvements assets have useful lives between 5 and 40 years. Equipment and furniture assets have useful lives between 3 and 7 years.

Loan Servicing Rights:

Servicing rights are recognized separately when they are acquired through sales of loans. When mortgage loans are sold, servicing rights are initially recorded at fair value with the income statement effect recorded in mortgage banking income. Fair value is based on a valuation model that calculates the present value of estimated future net servicing income. All classes of servicing assets are subsequently measured using the amortization method which requires servicing rights to be amortized into noninterest income in proportion to, and over the period of, the estimated future net servicing income of the underlying loans. The amortization of servicing rights is netted against mortgage banking income. Servicing fees totaled $1.1 million, $1.1 million and $1.0 million for the years ended December 31, 2019, 2018 and 2017, respectively. Late fees and ancillary fees related to loan servicing are not material.

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Servicing rights are evaluated for impairment based upon the fair value of the rights as compared to carrying amount. Impairment is determined by stratifying rights into groupings based on predominant risk characteristics, such as loan type, term and interest rate. Any impairment of a grouping is reported as a valuation allowance, to the extent that fair value is less than the carrying amount. If the Company later determines that all or a portion of the impairment no longer exists for a particular grouping, a reduction of the allowance may be recorded as an increase to income. Changes in the valuation allowance are reported with mortgage banking income on the income statement. The fair values of servicing rights are subject to significant fluctuations as a result of changes in estimated and actual prepayment speeds and default rates and losses.

The carrying value of mortgage servicing rights, which is included with other assets in the consolidated balance sheet, was $3.8 million and $3.3 million as of December 31, 2019 and 2018.

Mortgage loans serviced for others are not included in the accompanying consolidated balance sheets. The unpaid principal balances of these loans were $337.9 million and $343.5 million at December 31, 2019 and 2018. Custodial escrow balances maintained in connection with serviced loans were $1.6 million at year end 2019 and 2018.

Servicing fee income (loss), which is included in loan and service fees on the income statement, is recorded for fees earned for servicing loans. Fees earned for servicing loans are based on a contractual percentage of the outstanding principal amount of the loan and are recorded as income when earned.

Transfers of Financial Assets:

Transfers of financial assets are accounted for as sales, when control over the assets has been relinquished. Control over transferred assets is deemed to be surrendered when the assets have been isolated from the Company, the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets and the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity.

Mortgage Banking Derivatives:

Commitments to fund mortgage loans (interest rate locks) to be sold into the secondary market and forward commitments for the future delivery of these mortgage loans are accounted for as free standing derivatives. Fair values of these mortgage derivatives are estimated based on changes in mortgage interest rates from the date the interest on the loan is locked. The Company enters into forward commitments for the future delivery of mortgage loans when interest rate locks are entered into, in order to hedge the change in interest rates resulting from its commitments to fund the loans. Changes in fair values of these derivatives are included in mortgage banking income.

Interest Rate Swap Derivatives:

The Company offers a derivative product to certain creditworthy commercial banking customers. This product allows the commercial banking customers to enter into an agreement with the Company to swap a variable rate loan to a fixed rate. These derivative products are designed to reduce, eliminate or modify the borrower’s interest rate exposure. The extension of credit incurred in connection with these derivative products is subject to the same approval and underwriting standards as traditional credit products. The Company limits its risk exposure by simultaneously entering into a similar, offsetting swap agreement with a separate, well-capitalized and highly rated counterparty previously approved by the Company’s Asset Liability Committee. By using these interest rate swap arrangements, the Company is also better insulated from the interest rate risk associated with underwriting fixed-rate loans and is better able to meet customer demand for fixed rate loans. These derivative contracts are not designated against specific assets or liabilities and, therefore, do not qualify for hedge accounting. The derivatives are recorded as assets and liabilities on the balance sheet at fair value with changes in fair value recorded in non-interest income for both the commercial banking customer swaps and the related offsetting swaps. The fair value of the derivative instruments incorporates a consideration of credit risk (in accordance with ASC 820), resulting in some potential volatility in earnings each period.

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

The notional amount of the combined interest rate swaps with customers and counterparties at December 31, 2019 and 2018 was $349.6 million and $258.0 million, respectively. The fair value of the interest rate swap asset was $7.3 million and $3.9 million and the fair value of the interest rate swap liability was $7.9 million and $4.0 million at December 31, 2019 and 2018, respectively.

Bank Owned Life Insurance:

At December 31, 2019 and 2018, the Company owned $79.8 million and $73.9 million, respectively, of life insurance policies on certain officers to provide a life insurance benefit for these officers. At December 31, 2019 and 2018, the Company also owned $4.0 million and $3.2 million, respectively, of variable life insurance on certain officers related to a deferred compensation plan. Bank owned life insurance is recorded at the amount that can be realized under the insurance contract at the balance sheet date, i.e., the cash surrender value adjusted for other changes or other amounts due that are probable at settlement.

Goodwill and Other Intangible Assets:

All goodwill on the Company’s consolidated balance sheet resulted from business combinations prior to January 1, 2009 and represents the excess of the purchase price over the fair value of acquired tangible assets and liabilities and identifiable intangible assets. Goodwill is not amortized, but assessed at least annually for impairment and any such impairment will be recognized in the period identified.

FHLB and Federal Reserve Bank Stock:

FHLB and Federal Reserve Bank stock are carried at cost in other assets, classified as a restricted security and are periodically evaluated for impairment based on ultimate recoverability of par value. Both cash and stock dividends are reported as income.

Repurchase Agreements:

Substantially all repurchase agreement liabilities represent amounts advanced by various customers. Securities are pledged to cover these liabilities, which are not covered by federal deposit insurance. This product was discontinued during 2019.

Long-term Assets:

Premises and equipment, and other long-term assets are reviewed for impairment when events indicate their carrying amount may not be recoverable from future undiscounted cash flows. If impaired, the assets are recorded at fair value.

Benefit Plans:

The Company has a noncontributory defined benefit pension plan, which covered substantially all employees until the plan was frozen effective April 1, 2000. Funding of the plan equals or exceeds the minimum funding requirement determined by the actuary. Pension expense is the net of interest cost, return on plan assets and amortization of gains and losses not immediately recognized. Benefits are based on years of service and compensation levels.

The Company maintains a 401(k) profit sharing plan for all employees meeting certain age and service requirements. The Company contributions are based upon the percentage of budgeted net income earned during the year.

An employee deferred compensation plan is available to certain employees with returns based on investments in mutual funds.

The Company maintains a directors’ deferred compensation plan. Effective January 1, 2003, the directors’ deferred compensation plan was amended to restrict the deferral to be in stock only and deferred directors’ fees are included in equity. The Company acquires shares on the open market and records such shares as treasury stock.

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Stock Based Compensation:

Compensation cost is recognized for stock options and restricted stock awards issued to employees, based on the fair value of these awards at the date of grant. A Black-Scholes model is utilized to estimate the fair value of stock options, while the market price of the Company’s common stock at the date of grant adjusted for the present value of expected dividends is used for restricted stock awards. Compensation cost is recognized over the required service period, generally defined as the vesting period. Certain of the restricted stock awards are performance based, as more fully discussed in Note 15 – Stock Based Compensation.

Income Taxes:

Annual consolidated federal and state income tax returns are filed by the Company. Deferred income tax assets and liabilities are determined using the liability (or balance sheet) method. Income tax expense is recorded based on the amount of taxes due on its tax return plus net deferred taxes computed based upon the expected future tax consequences of temporary differences between carrying amounts and tax basis of assets and liabilities, using enacted tax rates. A valuation allowance, if needed, reduces deferred tax assets to the amount expected to be realized.

A tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is more likely of being realized on examination than not. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded.

The Company recognizes interest and/or penalties related to income tax matters in income tax expense.

Off-Balance Sheet Financial Instruments:

Financial instruments include credit instruments, such as commitments to make loans and standby letters of credit, issued to meet customer financing needs. The face amount for these items represents the exposure to loss, before considering customer collateral or ability to repay. Such financial instruments are recorded when they are funded. The fair value of standby letters of credit is recorded as a liability during the commitment period.

Earnings Per Common Share:

Basic earnings per common share is net income divided by the weighted average number of common shares outstanding during the period. Diluted earnings per common share includes the dilutive effect of additional potential common shares issuable under stock options, restricted stock awards and warrants. Earnings and dividends per share are restated for all stock splits and dividends through the date of issue of the financial statements. The common shares included in treasury stock for 2019 and 2018 include 178,741 and 172,959 shares, respectively, of Company common stock that has been purchased under the directors’ deferred compensation plan described above. Because these shares are held in trust for the participants, they are treated as outstanding when computing the weighted-average common shares outstanding for the calculation of both basic and diluted earnings per share.

Comprehensive Income:

Comprehensive income consists of net income and other comprehensive income (loss). Other comprehensive income (loss) includes unrealized gains and losses on securities available-for-sale and changes in the funded status of the pension plan, which are also recognized as separate components of equity.

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Loss Contingencies:

Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated. Management does not believe there currently are such matters that will have a material effect on the financial statements.

Restrictions on Cash:

The Company was required to have $28.9 million and $6.4 million of cash on hand or on deposit with the Federal Reserve Bank to meet regulatory reserve and clearing requirements at year-end 2019 and 2018, respectively. The Company met this requirement both years.

Dividend Restriction:

Banking regulations require maintaining certain capital levels and may limit the dividends paid by the Bank to the Company or by the Company to its stockholders. These restrictions currently pose no practical limit on the ability of the Bank or Company to pay dividends at historical levels.

Fair Value of Financial Instruments:

Fair values of financial instruments are estimated using relevant market information and other assumptions, as more fully disclosed in Note 5 - Fair Value. Fair value estimates involve uncertainties and matters of significant judgment regarding interest rates, credit risk, prepayments and other factors, especially in the absence of broad markets for particular items. Changes in assumptions or in market conditions could significantly affect the estimates.

Operating Segments:

The Company’s chief decision-makers monitor and evaluate financial performance on a Company-wide basis. All of the Company’s financial service operations are similar and considered by management to be aggregated into one reportable operating segment. While the Company has assigned certain management responsibilities by region and business-line, the Company’s chief decision-makers monitor and evaluate financial performance on a Company-wide basis. The majority of the Company’s revenue is from the business of banking and the Company’s assigned regions have similar economic characteristics, products, services and customers. Accordingly, all of the Company’s operations are considered by management to be aggregated in one reportable operating segment.

Adoption of New Accounting Standards:

The Company accounts for leases in accordance with ASU 2016-02, “Leases”, which the Company adopted on January 1, 2019. This guidance replaced existing lease guidance in GAAP and requires lessees to recognize lease assets and lease liabilities on the balance sheet for all leases and disclose key information about leasing arrangements. Lessees and lessors are required to recognize and measure leases that exist at the beginning of the earliest period presented using a modified retrospective approach. The Company recorded a right-of-use asset of $5.5 million and a lease liability of $5.5 million upon adoption, and there was no cumulative period adjustment made to retained earnings. This standard did not have a material impact on the Company’s consolidated balance sheets or cash flows from operations and had no impact on the Company’s operating results. The most significant impact was the recognition of right-of-use assets and lease obligations for operating leases. The Company elected to adopt the package of practical expedients for this standard. Disclosures are presented in Note 25 – Leases.

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

In March 2017, the FASB issued ASU No. 2017-08, “Receivables-Nonrefundable Fees and Other Costs: Premium Amortization on Purchased Callable Debt Securities.” This update amends the amortization period for certain purchased callable debt securities held at a premium. FASB has shortened the amortization period for the premium to the earliest call date. Under legacy GAAP, entities generally amortized the premium as an adjustment of yield over the contractual life of the instrument. The amendments in this update became effective for annual periods and interim periods within those annual periods beginning after December 15, 2018. The Company adopted this new accounting standard on January 1, 2019. The effect of adoption was a reduction in retained earnings of approximately $1.3 million to reflect the acceleration of amortization of premiums on available-for-sale debt securities.

In August 2017, the FASB issued ASU 2017-12, “Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities”. The purpose of this updated guidance is to better align a company's financial reporting for hedging activities with the economic objectives of those activities. ASU 2017-12 is effective for public business entities for fiscal years beginning after December 15, 2018, with early adoption, including adoption in an interim period, permitted. The Company adopted ASU 2017-12 on January 1, 2019. ASU 2017-12 required a modified retrospective transition method in which the Company recognized the cumulative effect of the change on the opening balance of each affected component of equity in the consolidated balance sheet as of the date of adoption. Adopting this standard did not have an impact on the Company’s financial condition or operations.

Newly Issued But Not Yet Effective Accounting Standards:

In June 2016, the FASB issued guidance related to credit losses on financial instruments. This update, commonly referred to as the current expected credit losses methodology (“CECL”), will change the accounting for credit losses on loans and debt securities. Under the new guidance, the Company’s measurement of expected credit losses is to be based on information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. For loans, this measurement will take place at the time the financial asset is first added to the balance sheet and periodically thereafter. This differs significantly from the “incurred loss” model required under current GAAP, which delays recognition until it is probable a loss has been incurred. In addition, the guidance will modify the other-than-temporary impairment model for available-for-sale debt securities to require an allowance for credit impairment instead of a direct write-down, which will allow for reversal of credit impairments in future periods. This guidance is effective for the Company for fiscal years beginning after December 15, 2019, including interim periods in those fiscal years. This amendment is required to be adopted using a modified retrospective approach with a cumulative-effect adjustment to beginning retained earnings, as of the beginning of the first reporting period in which the guidance is effective.

The Company formed a cross-functional committee that has evaluated existing technology and other solutions to assist with calculating losses under this new standard, selected a vendor to validate data currently loaded in the technology solution, and reviewed the validation assessment report. Additionally, the committee has selected a probability of default/loss given default model, run parallel calculations and evaluated changes to the overall internal control structure under the new model. Upon adoption of this standard, the Company will recognize credit losses earlier than it historically has done under the current incurred loss model. The Company will utilize a one to two year reasonable and supportable forecast period.

Due to this change in methodology, the Company anticipates larger increases in credit loss allowances for its longer-lived retail portfolios and smaller increases for its shorter-lived commercial portfolio. Based upon the Company’s loan portfolio composition at December 31, 2019, and the current economic environment and management’s current forecast and qualitative adjustment assumptions, the Company estimates an 8% - 13% increase in its allowance for credit losses upon adoption of this standard. The final impact of CECL on its allowance for credit losses, effective January 1, 2020, will depend on refinements to key assumptions including forecasting and qualitative factors. Once final, the calculation will require approval by the loan review committee and governance in accordance with the Company’s internal controls over financial reporting. Additionally, the Company has evaluated the need to recognize an allowance for credit impairment for available-for-sale debt securities. The impact on available-for-sale debt securities is subject to a limitation, which is based on the fair value of the debt securities. When evaluating the credit quality of our existing portfolio, the Company does not expect the allowance for credit impairment for available-for-sale securities to be significant.

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

In January 2017, the FASB issued ASU No. 2017-04 "Intangibles - Goodwill and Other - Simplifying the Test for Goodwill Impairment." These amendments eliminate Step 2 from the goodwill impairment test. The amendments also eliminate the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment and, if it fails that qualitative test, to perform Step 2 of the goodwill impairment test. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. The guidance is effective for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. ASU 2017-04 should be adopted on a prospective basis. Management does not expect the adoption of this new accounting standard to have a material impact on our financial statements.

Reclassifications:

Certain amounts appearing in the financial statements and notes thereto for prior periods have been reclassified to conform with the current presentation. The reclassifications had no effect on net income or stockholders’ equity as previously reported.

STOCK BASED COMPENSATION - Summary Of Changes In Company's Nonvested Shares (Details)	12 Months Ended
	Dec. 31, 2019 $ / shares shares
Restricted Stock Units (RSUs) [Member]
Shares
Shares Nonvested, beginning balance \| shares	1,000
Granted \| shares	19,100
Vested \| shares	(16,600)
Shares Nonvested, ending balance \| shares	3,500
Weighted-Average Grant-Date Fair Value
Weighted-Average Grant-Date Fair Value, beginning balance \| $ / shares	$ 48.14
Granted \| $ / shares	44.59
Vested \| $ / shares	44.56
Weighted-Average Grant-Date Fair Value, ending balance \| $ / shares	$ 45.70
Performance Stock Units [Member]
Shares
Shares Nonvested, beginning balance \| shares	368,503
Granted \| shares	39,715
Vested \| shares	(126,672)
Forfeited \| shares	(4,461)
Shares Nonvested, ending balance \| shares	277,085
Weighted-Average Grant-Date Fair Value
Weighted-Average Grant-Date Fair Value, beginning balance \| $ / shares	$ 39.83
Granted \| $ / shares	41.78
Vested \| $ / shares	29.23
Forfeited \| $ / shares	45.42
Weighted-Average Grant-Date Fair Value, ending balance \| $ / shares	$ 44.86

LOANS

12 Months Ended

Dec. 31, 2019

LOANS

LOANS

NOTE 3 – LOANS

Total loans outstanding as of the years ended December 31, 2019 and 2018 consisted of the following:


(dollars in thousands)	2019		2018
Commercial and industrial loans:
Working capital lines of credit loans	$	709,849	$	690,620
Non-working capital loans		717,019		714,759
Total commercial and industrial loans		1,426,868		1,405,379

Commercial real estate and multi-family residential loans:
Construction and land development loans		287,641		266,805
Owner occupied loans		573,665		586,325
Nonowner occupied loans		571,364		520,901
Multi-family loans		240,652		195,604
Total commercial real estate and multi-family residential loans		1,673,322		1,569,635

Agri-business and agricultural loans:
Loans secured by farmland		174,380		177,503
Loans for agricultural production		205,151		193,010
Total agri-business and agricultural loans		379,531		370,513

Other commercial loans		112,302		95,657
Total commercial loans		3,592,023		3,441,184

Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		177,227		185,822
Open end and junior lien loans		186,552		187,030
Residential construction and land development loans		12,966		16,226
Total consumer 1-4 family mortgage loans		376,745		389,078

Other consumer loans		98,617		86,064
Total consumer loans		475,362		475,142
Gross loans		4,067,385		3,916,326
Less: Allowance for loan losses		(50,652)		(48,453)
Net deferred loan fees		(1,557)		(1,581)
Loans, net	$	4,015,176	$	3,866,292

The recorded investment in loans does not include accrued interest.

The Company had $1.6 million and $586,000 in residential real estate loans in process of foreclosure as of December 31, 2019 and 2018, respectively.

SECURITIES - Sales Of Securities Available For Sale (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Sales of securities available for sale
Proceeds	$ 57,114	$ 15,302	$ 40,877
Gross gains	279	21	267
Gross losses	$ (137)	$ (71)	$ (235)
Number of securities	46	29	50

PENSION AND OTHER POSTRETIREMENT PLANS - Amounts Recognized in Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Defined Benefit Plan Disclosure [Line Items]
Net actuarial loss	$ 153	$ (372)	$ (211)
Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Net actuarial loss	1,464	1,242
SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Net actuarial loss	$ 597	$ 615

STOCK BASED COMPENSATION (Tables)

12 Months Ended

Dec. 31, 2019

STOCK BASED COMPENSATION

Schedule of Information on Stock Awards Exercised


(dollars in thousands)	2019		2018		2017
Total intrinsic value	$	0	$	243	$	44
Cash received		0		118		24
Actual tax benefit realized for tax deductions		0		0		0

Schedule of Restricted Stock Awards and Units

A summary of the changes in the Company’s non-vested shares for the year follows:


		Weighted-Average
		Grant-Date
Nonvested Shares	Shares	Fair Value
Nonvested at January 1, 2019	1,000	$	48.14
Granted	19,100		44.59
Vested	(16,600)		44.56
Nonvested at December 31, 2019	3,500	$	45.70

Schedule of Nonvested Performance-based Units

Shares granted below include the number of shares assumed granted based on actual performance criteria of the 2019-2021, 2018-2020 and 2017-2019 Long-Term Incentive Plans at December 31, 2019.


		Weighted-Average
		Grant-Date
Nonvested Shares	Shares	Fair Value
Nonvested at January 1, 2019	368,503	$	39.83
Granted	39,715		41.78
Vested	(126,672)		29.23
Forfeited	(4,461)		45.42
Nonvested at December 31, 2019	277,085	$	44.86

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

12 Months Ended

Dec. 31, 2019

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

NOTE 21 – ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The following tables summarize the changes within each classification of accumulated other comprehensive income (loss) for December 31, 2019 and 2018 all shown net of tax:


	Unrealized
	Gains and
	(Losses) on		Defined
	Available-		Benefit
	for-Sales		Pension
(dollars in thousands)	Securities		Items		Total
Balance at December 31, 2018	$	(4,796)	$	(1,395)	$	(6,191)
Other comprehensive income (loss) before reclassification		18,515		(306)		18,209
Amounts reclassified from accumulated other comprehensive income (loss)		(112)		153		41
Net current period other comprehensive income (loss)		18,403		(153)		18,250
Balance at December 31, 2019	$	13,607	$	(1,548)	$	12,059


	Unrealized
	Gains and
	(Losses) on		Defined
	Available-		Benefit
	for-Sales		Pension
(dollars in thousands)	Securities		Items		Total
Balance at December 31, 2017	$	784	$	(1,454)	$	(670)
Other comprehensive income (loss) before reclassification		(5,691)		175		(5,516)
Amounts reclassified from accumulated other comprehensive income (loss)		39		197		236
Net current period other comprehensive income (loss)		(5,652)		372		(5,280)
Adoption of ASU 2018-02		140		(313)		(173)
Adoption of ASU 2016-01		(68)		0		(68)
Balance at December 31, 2018	$	(4,796)	$	(1,395)	$	(6,191)

NOTE 21 – ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (continued)

Reclassifications out of accumulated comprehensive income for the years ended December 31, 2019, 2018 and 2017 are as follows:


Details about	Amount		Affected Line Item
Accumulated Other	Reclassified From		in the Statement
Comprehensive	Accumulated Other		Where Net
Income (Loss) Components	Comprehensive Income (Loss)		Income is Presented
2019
(dollars in thousands)
Realized gains and losses on available-for-sale securities	$	142	Net securities gains (losses)
Tax effect		(30)	Income tax expense
Subtotal		112	Net of tax
Amortization of defined benefit pension items⁽¹⁾		(205)	Salaries and employee benefits
Tax effect		52	Income tax expense
Subtotal		(153)	Net of tax
Total reclassifications for the period	$	(41)	Net income


2018
(dollars in thousands)
Realized gains and losses on available-for-sale securities	$	(50)	Net securities gains (losses)
Tax effect		11	Income tax expense
Subtotal		(39)	Net of tax
Amortization of defined benefit pension items⁽¹⁾		(266)	Salaries and employee benefits
Tax effect		69	Income tax expense
Subtotal		(197)	Net of tax
Total reclassifications for the period	$	(236)	Net income


2017
(dollars in thousands)
Realized gains and losses on available-for-sale securities	$	32	Net securities gains (losses)
Tax effect		(13)	Income tax expense
Subtotal		19	Net of tax
Amortization of defined benefit pension items⁽¹⁾		(265)	Salaries and employee benefits
Tax effect		104	Income tax expense
Subtotal		(161)	Net of tax
Total reclassifications for the period	$	(142)	Net income

(1)	Included in the computation of net pension plan expense as more fully discussed in Note 11 – Pension and Other Postretirement Plans.

RELATED PARTY TRANSACTIONS - Additional Information (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018
RELATED PARTY TRANSACTIONS
Due to Related Parties	$ 33.3	$ 12.1
Additional Amount Due To Related Parties Current and Non Current	$ 0.0	$ 1.9

SECURITIES - Fair Value and Amortized Cost Of Securities Available For Sale (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Available for sale securities
Amortized Cost	$ 591,009	$ 591,621
Gross Unrealized Gain	17,841	2,795
Gross Unrealized Losses	(617)	(8,867)
Fair Value	608,233	585,549
US Treasury Securities
Available for sale securities
Amortized Cost		994
Gross Unrealized Gain		0
Gross Unrealized Losses		(7)
Fair Value		987
US Government Sponsored Agencies
Available for sale securities
Amortized Cost		4,435
Gross Unrealized Gain		0
Gross Unrealized Losses		(85)
Fair Value		4,350
Mortgage-backed securities residential
Available for sale securities
Amortized Cost	283,817	329,516
Gross Unrealized Gain	4,751	1,392
Gross Unrealized Losses	(387)	(5,496)
Fair Value	288,181	325,412
Mortgage-backed securities commercial
Available for sale securities
Amortized Cost	36,712	38,712
Gross Unrealized Gain	262	0
Gross Unrealized Losses	(2)	(571)
Fair Value	36,972	38,141
State and Municipal Securities
Available for sale securities
Amortized Cost	270,480	217,964
Gross Unrealized Gain	12,828	1,403
Gross Unrealized Losses	(228)	(2,708)
Fair Value	$ 283,080	$ 216,659

PARENT COMPANY STATEMENTS

12 Months Ended

Dec. 31, 2019

PARENT COMPANY STATEMENTS

PARENT COMPANY STATEMENTS

NOTE 19 – PARENT COMPANY STATEMENTS

The Company operates primarily in the banking industry, which accounts for substantially all of its revenues, operating income and assets. Presented below are parent only financial statements:

CONDENSED BALANCE SHEETS


	December 31,
(dollars in thousands)	2019		2018
ASSETS
Deposits with Lake City Bank	$	1,762	$	1,283
Deposits with other depository institutions		2,104		7,613
Cash		3,866		8,896
Investments in banking subsidiary		582,674		533,442
Investments in other subsidiaries		3,276		3,992
Other assets		8,457		6,468
Total assets	$	598,273	$	552,798
LIABILITIES
Dividends payable and other liabilities	$	262	$	255
Subordinated debt		0		30,928
STOCKHOLDERS’ EQUITY		598,011		521,615
Total liabilities and stockholders’ equity	$	598,273	$	552,798

NOTE 19 – PARENT COMPANY STATEMENTS (continued)

CONDENSED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME


	Years Ended December 31,
(dollars in thousands)	2019		2018		2017
Dividends from Lake City Bank	$	57,842	$	27,933	$	21,822
Dividends from non-bank subsidiaries		1,302		1,010		1,030
Other income		155		171		57
Interest expense on subordinated debt		(1,720)		(1,643)		(1,349)
Miscellaneous expense		(5,321)		(6,422)		(6,491)
INCOME BEFORE INCOME TAXES AND EQUITY IN UNDISTRIBUTED INCOME OF SUBSIDIARIES		52,258		21,049		15,069
Income tax benefit		2,256		2,795		2,688
INCOME BEFORE EQUITY IN UNDISTRIBUTED INCOME OF SUBSIDIARIES		54,514		23,844		17,757
Equity in undistributed income of subsidiaries		32,533		56,567		39,573
NET INCOME	$	87,047	$	80,411	$	57,330
COMPREHENSIVE INCOME	$	105,297	$	75,131	$	59,047

CONDENSED STATEMENTS OF CASH FLOWS


	Years Ended December 31,
(dollars in thousands)	2019		2018		2017
Cash flows from operating activities:
Net income	$	87,047	$	80,411	$	57,330
Adjustments to net cash from operating activities:
Equity in undistributed income of subsidiaries		(32,533)		(56,567)		(39,573)
Other changes		3,529		7,294		3,586
Net cash from operating activities		58,043		31,138		21,343
Cash flows from financing activities
Repayment of long-term debt		(30,928)		0		0
Payments related to equity incentive plans		(2,109)		(2,435)		(1,736)
Purchase of treasury stock		(515)		(463)		(495)
Sales of treasury stock		118		115		0
Dividends paid		(29,639)		(25,278)		(21,396)
Cash flows from financing activities		(63,073)		(28,061)		(23,627)
Net increase (decrease) in cash and cash equivalents		(5,030)		3,077		(2,284)
Cash and cash equivalents at beginning of the year		8,896		5,819		8,103
Cash and cash equivalents at end of the year	$	3,866	$	8,896	$	5,819

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Common Stock	Retained Earnings	Accumulated Other Comprehensive Income (Loss)	Treasury Stock	Total Stockholders' Equity	Noncontrolling Interest	Total
Balance at Dec. 31, 2016	$ 104,405	$ 327,873	$ (2,387)	$ (2,913)	$ 426,978	$ 89	$ 427,067
Balance (in shares) at Dec. 31, 2016	24,937,865
Net income		57,330			57,330		57,330
Other comprehensive income (loss), net of tax			1,717		1,717		1,717
Cash dividends declared		(21,409)			(21,409)		(21,409)
Treasury shares purchased under deferred directors' plan	$ 495			(495)	0		0
Treasury shares purchased under deferred directors' plan (in shares)	(10,748)
Stock activity under equity incentive plans	$ (1,736)				(1,736)		(1,736)
Stock activity under equity incentive plans (in shares)	98,816
Stock based compensation expense	$ 5,698				5,698		5,698
Balance at Dec. 31, 2017	$ 108,862	363,794	(670)	(3,408)	468,578	89	468,667
Balance (in shares) at Dec. 31, 2017	25,025,933
Adoption of ASU \| Accounting Standards Update 2018-02		173	(173)		0		0
Adoption of ASU \| Accounting Standards Update 2014-09		24			24		24
Adoption of ASU \| Accounting Standards Update 2016-01		68	(68)		0		0
Net income		80,411			80,411		80,411
Other comprehensive income (loss), net of tax			(5,280)		(5,280)		(5,280)
Cash dividends declared		(25,291)			(25,291)		(25,291)
Treasury shares purchased under deferred directors' plan	$ 463			(463)	0		0
Treasury shares purchased under deferred directors' plan (in shares)	(9,625)
Treasury shares sold and distributed under deferred directors' plan	$ (115)			115	0		0
Treasury shares sold and distributed under deferred directors' plan (in shares)	5,636
Stock activity under equity incentive plans	$ (2,435)				(2,435)		(2,435)
Stock activity under equity incentive plans (in shares)	106,829
Stock based compensation expense	$ 5,608				5,608		5,608
Balance at Dec. 31, 2018	$ 112,383	419,179	(6,191)	(3,756)	521,615	89	521,704
Balance (in shares) at Dec. 31, 2018	25,128,773
Adoption of ASU \| Accounting Standards Update 2017-08		(1,327)			(1,327)		(1,327)
Net income		87,047			87,047		87,047
Other comprehensive income (loss), net of tax			18,250		18,250		18,250
Cash dividends declared		(29,652)			(29,652)		(29,652)
Cashless exercise of warrents	$ 0				0		0
Cashless exercise of warrents (in shares)	224,066
Treasury shares purchased under deferred directors' plan	$ 515			(515)	0		0
Treasury shares purchased under deferred directors' plan (in shares)	(11,481)
Treasury shares sold and distributed under deferred directors' plan	$ (118)			118	0		0
Treasury shares sold and distributed under deferred directors' plan (in shares)	5,699
Stock activity under equity incentive plans	$ (2,109)				(2,109)		(2,109)
Stock activity under equity incentive plans (in shares)	97,218
Stock based compensation expense	$ 4,187				4,187		4,187
Balance at Dec. 31, 2019	$ 114,858	$ 475,247	$ 12,059	$ (4,153)	$ 598,011	$ 89	$ 598,100
Balance (in shares) at Dec. 31, 2019	25,444,275

DEPOSITS (Tables)

12 Months Ended

Dec. 31, 2019

DEPOSITS

Schedule of Certain Deposits

The following table details total deposits as of December 31, 2019 and 2018:


(dollars in thousands)	2019		2018
Non-interest bearing demand deposits	$	983,307	$	946,838
Savings and transaction accounts:
Savings deposits		234,508		247,903
Interest bearing demand deposits		1,723,937		1,429,570
Time deposits:
Other time deposits		281,934		273,533
Deposits of $100,000 to $250,000		291,805		268,058
Deposits of $250,000 or more		618,328		878,163
Total deposits	$	4,133,819	$	4,044,065

Schedule of maturities of time deposits

At December 31, 2019, the scheduled maturities of time deposits were as follows:


(dollars in thousands)	Amount
Maturing in 2020	$	895,601
Maturing in 2021		206,303
Maturing in 2022		35,181
Maturing in 2023		23,143
Maturing in 2024		29,747
Thereafter		2,092
Total time deposits	$	1,192,067

CAPITAL REQUIREMENTS AND RESTRICTIONS ON RETAINED EARNINGS - Summary Of Capital Adequacy Requirements (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Consolidated Entities [Member]
Compliance with Regulatory Capital Requirements under Banking Regulations
Total Capital (to Risk Weighted Assets), Actual Amount	$ 631,723	$ 601,379
Total Capital (to Risk Weighted Assets), Actual Ratio	14.36%	14.20%
Tier I Capital (to Risk Weighted Assets), Actual Amount	$ 580,982	$ 552,836
Tier I Capital (to Risk Weighted Assets), Actual Ratio	13.21%	13.06%
Common Equity Tier 1 (CET1), Actual Amount	$ 580,982	$ 522,836
Common Equity Tier 1 (CET1), Actual Ratio	13.21%	12.35%
Tier I Capital (to Average Assets), Actual Amount	$ 580,982	$ 552,836
Tier I Capital (to Average Assets), Actual Ratio	11.67%	11.44%
Total Capital (to Risk Weighted Assets), Minimum Required For Capital Adequacy Purposes Amount	$ 351,894	$ 338,690
Total Capital (to Risk Weighted Assets), Minimum Required For Capital Adequacy Purposes Ratio	8.00%	8.00%
Tier I Capital (to Risk Weighted Assets), Minimum Required For Capital Adequacy Purposes Amount	$ 263,921	$ 254,017
Tier I Capital (to Risk Weighted Assets), Minimum Required For Capital Adequacy Purposes Ratio	6.00%	6.00%
Common Equity Tier 1 (CET1), Minimum Required For Capital Adequacy Purposes Amount	$ 197,941	$ 190,513
Common Equity Tier 1 (CET1), Minimum Required For Capital Adequacy Purposes Ratio	4.50%	4.50%
Tier I Capital (to Average Assets), Minimum Required For Capital Adequacy Purposes Amount	$ 199,099	$ 193,305
Tier I Capital (to Average Assets), Minimum Required For Capital Adequacy Purposes Ratio	4.00%	4.00%
Excess Capital, For Capital Adequacy Purposes Plus Capital Conservation Buffer Amount	$ 461,862	$ 418,070
Tier I Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Plus Capital Conservation Buffer Amount	373,887	333,398
Common Equity Tier 1 (CET1), For Capital Adequacy Purposes Plus Capital Conservation Buffer Amount	307,908	269,893
Tier I Capital (to Average Assets), For Capital Adequacy Purposes Plus Capital Conservation Buffer Amount	199,099	193,305
Bank [Member]
Compliance with Regulatory Capital Requirements under Banking Regulations
Total Capital (to Risk Weighted Assets), Actual Amount	$ 616,386	$ 583,206
Total Capital (to Risk Weighted Assets), Actual Ratio	14.04%	13.80%
Tier I Capital (to Risk Weighted Assets), Actual Amount	$ 565,645	$ 534,664
Tier I Capital (to Risk Weighted Assets), Actual Ratio	12.88%	12.65%
Common Equity Tier 1 (CET1), Actual Amount	$ 565,645	$ 534,664
Common Equity Tier 1 (CET1), Actual Ratio	12.88%	12.65%
Tier I Capital (to Average Assets), Actual Amount	$ 565,645	$ 534,664
Tier I Capital (to Average Assets), Actual Ratio	11.43%	11.06%
Total Capital (to Risk Weighted Assets), Minimum Required For Capital Adequacy Purposes Amount	$ 351,227	$ 338,098
Total Capital (to Risk Weighted Assets), Minimum Required For Capital Adequacy Purposes Ratio	8.00%	8.00%
Tier I Capital (to Risk Weighted Assets), Minimum Required For Capital Adequacy Purposes Amount	$ 263,420	$ 253,574
Tier I Capital (to Risk Weighted Assets), Minimum Required For Capital Adequacy Purposes Ratio	6.00%	6.00%
Common Equity Tier 1 (CET1), Minimum Required For Capital Adequacy Purposes Amount	$ 197,565	$ 190,180
Common Equity Tier 1 (CET1), Minimum Required For Capital Adequacy Purposes Ratio	4.50%	4.50%
Tier I Capital (to Average Assets), Minimum Required For Capital Adequacy Purposes Amount	$ 197,923	$ 193,312
Tier I Capital (to Average Assets), Minimum Required For Capital Adequacy Purposes Ratio	4.00%	4.00%
Excess Capital, For Capital Adequacy Purposes Plus Capital Conservation Buffer Amount	$ 460,985	$ 417,340
Excess Capital to Risk Weighted Assets, For Capital Adequacy Purposes Plus Capital Conservation Buffer Ratio	10.50%	9.875%
Tier I Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Plus Capital Conservation Buffer Amount	$ 373,179	$ 332,815
Tier I Capital (to Risk Weighted Assets), For Capital Adequacy Purposes Plus Capital Conservation Buffer Ratio	8.50%	7.875%
Common Equity Tier 1 (CET1), For Capital Adequacy Purposes Plus Capital Conservation Buffer Amount	$ 307,324	$ 269,422
Common Equity Tier 1 (CET1), For Capital Adequacy Purposes Plus Capital Conservation Buffer Ratio	7.00%	6.375%
Tier I Capital (to Average Assets), For Capital Adequacy Purposes Plus Capital Conservation Buffer Amount	$ 197,923	$ 193,312
Tier I Capital (to Average Assets), For Capital Adequacy Purposes Plus Capital Conservation Buffer Ratio	4.00%	4.00%
Total Capital (to Risk Weighted Assets), Minimum Required to Be Well Capitalized Under Prompt Corrective Action Regulations Amount	$ 439,034	$ 422,623
Total Capital (to Risk Weighted Assets), Minimum Required to Be Well Capitalized Under Prompt Corrective Action Regulations Ratio	10.00%	10.00%
Tier I Capital (to Risk Weighted Assets), Minimum Required to Be Well Capitalized Under Prompt Corrective Action Regulations Amount	$ 351,227	$ 338,098
Tier I Capital (to Risk Weighted Assets), Minimum Required to Be Well Capitalized Under Prompt Corrective Action Regulations Ratio	8.00%	8.00%
Common Equity Tier 1 (CET1), Minimum Required to Be Well Capitalized Under Prompt Corrective Action Regulations Amount	$ 285,372	$ 274,705
Common Equity Tier 1 (CET1), Minimum Required to Be Well Capitalized Under Prompt Corrective Action Regulations Ratio	6.50%	6.50%
Tier I Capital (to Average Assets), Minimum Required to Be Well Capitalized Under Prompt Corrective Action Regulations Amount	$ 247,404	$ 241,639
Tier I Capital (to Average Assets), Minimum Required to Be Well Capitalized Under Prompt Corrective Action Regulations Ratio	5.00%	5.00%

REVENUE RECOGNITION

12 Months Ended

Dec. 31, 2019

REVENUE RECOGNITION

REVENUE RECOGNITION

NOTE 24 – REVENUE RECOGNITION


	Year Ended December 31,
	2019		2018		2017 ⁽²⁾
NONINTEREST INCOME
Wealth advisory fees	$	6,835	$	6,344	$	5,481
Investment brokerage fees		1,687		1,458		1,273
Service charges on deposit accounts
Service charges on commercial deposit acounts		10,082		10,234		8,230
Service charges on retail deposit acounts		880		879		905
Overdrafts, net		3,585		3,581		3,452
Other		1,170		1,137		1,109
Loan and service fees
Debit card interchange fees		6,344		5,883		4,663
Loan fees ⁽¹⁾		2,544		2,423		2,231
Other		1,023		985		1,006
Merchant card fee income		2,641		2,461		2,279
Bank owned life insurance income ⁽¹⁾		1,890		1,244		1,768
Mortgage banking income ⁽¹⁾		1,626		1,150		982
Net securities gains (losses) ⁽¹⁾		142		(50)		32
Other income		4,548		2,573		2,629
Total noninterest income	$	44,997	$	40,302	$	36,040

(1)	Not within scope of ASC 606

(2)

The following is a description of principal activities from which we generate revenue. Revenues are recognized as the Company satisfies its obligations with our customers, in an amount that reflects the consideration that we expect to receive in exchange for those services.

Wealth advisory fees

The Company provides wealth advisory services to its customers and earns fees from its contracts with trust customers to manage assets for investment and/or to transact on their accounts. These fees are primarily earned over time as the Company provides the contracted monthly, quarterly, or annual services and are generally assessed based on a tiered scale of the market value of assets under management (AUM) at month-end. Fees that are transaction based, including trade execution services, are recognized at the point in time that the transaction is executed. Other related services, such as escrow accounts that are based on a fixed schedule, are recognized when the services are rendered.

NOTE 24 – REVENUE RECOGNITION (continued)

Investment brokerage services

The Company provides investment brokerage services through a full service brokerage and investment and advisory firm, Cetera Investment Services LLC (“Cetera”). The Company receives commissions from Cetera on a monthly basis based upon customer activity for the month. The fees are recognized monthly and a receivable is recorded until commissions are generally paid by the 5th business day of the following month. Because the Company (i) acts as an agent in arranging the relationship between the customer and the Cetera and (ii) does not control the services to the customers, investment brokerage service fees are presented net of Cetera’s related costs.

Service charges on deposit accounts

The Company earns fees from its deposit customers for transaction-based, account maintenance, and overdraft services. Transaction-based fees, which include services such as ATM use fees, stop payment charges, statement rendering, and ACH fees, are recognized at the time the transaction is executed as that is the point in time the Company fulfills the customer’s request. Account maintenance fees, which relate primarily to monthly maintenance, are earned over the course of a month, representing the period over which the Company satisfies the performance obligation. Overdraft fees are recognized at the point in time that the overdraft occurs. Service charges on deposits are withdrawn from the customer’s balance.

Interchange income

The Company provides the ability to transact on certain deposit accounts through the use of debit cards by outsourcing the services through third party service providers. Performance obligations are met on a transactional basis and income is recognized monthly based on transaction type and volume. Under the accounting standards in effect in the prior period, revenue was previously recognized net of the third party’s costs. Under ASC 606, fees from interchange income related to its customers use of debit cards will be reported gross in loan and service fees under noninterest income. The cost of using third party providers for these interchange services will be reported in data processing fees and supplies under noninterest expense, which has no effect on net income for the period.

Gain on sale of other real estate (OREO) owned financed by seller

On occasion, the Company underwrites a loan to purchase property owned by the Company. Under the accounting standards in effect in the prior period, the gain on the sale of the Company owned property was deferred and recognized over the life of the loan. Under ASC 606, the Company assesses whether the buyer is committed to perform their obligations under the contract and whether collectability of the transaction price is probable. Once these criteria are met, the OREO asset is derecognized and the gain or loss on sale is recorded upon the transfer of control of the property to the buyer. In determining the gain or loss on the sale, the Company adjusts the transaction price and related gain (loss) on sale if a significant financing component is present. As a result of the adoption of ASC 606, the Company reported a net increase of $24,000 to opening retained earnings as of January 1, 2018.

Debit card incentive rebates

The Company receives incentive rebates based on debit card transaction volume. Performance obligations are met on a transactional basis and income is recognized monthly based on transaction volume. Under the accounting standards in effect in the prior period, revenue was previously recognized in other income under noninterest income. Under ASC 606, these rebates related to debit card transaction volume will be reported as a contra expense in data processing fees and supplies under noninterest expense, which has no effect on net income for the period.

RELATED PARTY TRANSACTIONS - Summary of Loans To Related Party (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
RELATED PARTY TRANSACTIONS
Beginning balance	$ 83,546	$ 105,242
New loans and advances	55,465	94,542
Effect of changes in related parties	(5,967)	0
Repayments and renewals	(49,064)	(116,238)
Ending balance	$ 83,980	$ 83,546

BORROWINGS - Short-Term Borrowings (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Short-term Debt [Line Items]
Other Short-term Borrowings	$ 170,000	$ 170,000
Federal Home Loan Bank of Indianapolis Advance, 1.61%, Due January 7, 2020
Short-term Debt [Line Items]
Other Short-term Borrowings	170,000	0
Federal Home Loan Bank of Indianapolis Notes, 2.52%, Due January 7, 2019
Short-term Debt [Line Items]
Other Short-term Borrowings	$ 0	$ 170,000

SELECTED QUARTERLY DATA (UNAUDITED) - Summary Of Selected Quarterly Data (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
SELECTED QUARTERLY DATA (UNAUDITED)
Interest income	$ 52,312	$ 54,769	$ 54,635	$ 53,494	$ 53,728	$ 50,379	$ 48,795	$ 46,068	$ 215,210	$ 198,970	$ 165,698
Interest expense	13,430	15,224	16,224	15,285	14,138	12,454	11,262	9,845	60,163	47,699	29,806
Net interest income	38,882	39,545	38,411	38,209	39,590	37,925	37,533	36,223	155,047	151,271	135,892
Provision for loan losses	250	1,000	785	1,200	300	1,100	1,700	3,300	3,235	6,400	3,000
Net interest income after provision	38,632	38,545	37,626	37,009	39,290	36,825	35,833	32,923	151,812	144,871	132,892
Noninterest income	11,119	10,765	11,588	11,525	10,077	10,624	9,722	9,879
Noninterest expense	22,122	22,737	22,092	22,473	22,524	22,200	20,303	21,202	89,424	86,229	79,298
Income tax expense	5,431	5,119	5,409	4,379	5,480	4,679	5,110	3,264	20,338	18,533	32,304
Net income	$ 22,198	$ 21,454	$ 21,713	$ 21,682	$ 21,363	$ 20,570	$ 20,142	$ 18,336	$ 87,047	$ 80,411	$ 57,330
Basic earnings per common share	$ 0.86	$ 0.84	$ 0.85	$ 0.85	$ 0.84	$ 0.81	$ 0.80	$ 0.73	$ 3.40	$ 3.18	$ 2.28
Diluted earnings per common share	$ 0.86	$ 0.83	$ 0.85	$ 0.84	$ 0.83	$ 0.80	$ 0.79	$ 0.71	$ 3.38	$ 3.13	$ 2.23

PENSION AND OTHER POSTRETIREMENT PLANS (Tables)

12 Months Ended

Dec. 31, 2019

OTHER BENEFIT PLANS

Schedule of Changes in Projected Benefit Obligations and Plan Assets

Information as to the Company’s employee benefit plans at December 31, 2019 and 2018 is as follows:


	Pension Benefits				SERP Benefits
(dollars in thousands)	2019		2018		2019		2018
Change in benefit obligation:
Beginning benefit obligation	$	2,118	$	2,862	$	924	$	1,086
Interest cost		87		93		37		34
Actuarial (gain) loss		631		(325)		164		(62)
Benefits paid		(121)		(512)		(134)		(134)
Ending benefit obligation		2,715		2,118		991		924

Change in plan assets (primarily equity and fixed income investments and money market funds), at fair value:
Beginning plan assets		2,151		2,356		885		1,047
Actual return		415		(61)		163		(28)
Employer contribution		27		368		0		0
Benefits paid		(121)		(512)		(134)		(134)
Ending plan assets		2,472		2,151		914		885
Funded status at end of year	$	(243)	$	33	$	(77)	$	(39)

Schedule of Amounts Recognized in Balance Sheet

Amounts recognized in the consolidated balance sheets consist of:


	Pension Benefits				SERP Benefits
(dollars in thousands)	2019		2018		2019		2018
Funded status included in other liabilities	$	(243)	$	33	$	(77)	$	(39)

Schedule of Amounts Recognized in Accumulated Other Comprehensive Income (loss)

Amounts recognized in accumulated other comprehensive income (loss) consist of:


	Pension Benefits				SERP Benefits
(dollars in thousands)	2019		2018		2019		2018
Net actuarial loss	$	1,464	$	1,242	$	597	$	615

Schedule of Components of Net Periodic Benefit Cost

Net period benefit cost and other amounts recognized in other comprehensive income (loss) include the following:


	Pension Benefits						SERP Benefits
(dollars in thousands)	2019		2018		2017		2019		2018		2017
Net pension expense:
Service cost	$	0	$	0	$	0	$	0	$	0	$	0
Interest cost		87		93		104		37		34		40
Expected return on plan assets		(137)		(138)		(143)		(55)		(61)		(63)
Recognized net actuarial loss		132		193		185		73		73		80
Settlement cost		0		224		0		0		0		0
Net pension expense	$	82	$	372	$	146	$	55	$	46	$	57

Net (gain) loss	$	353	$	(296)	$	(36)	$	56	$	27	$	(61)
Amortization of net loss		(132)		(193)		(185)		(73)		(73)		(80)
Total recognized in other comprehensive income (loss)		221		(489)		(221)		(17)		(46)		(141)
Total recognized in net pension expense and other comprehensive income (loss)	$	303	$	(117)	$	(75)	$	38	$	0	$	(84)

Schedule of Assumptions Used in Calculating the Net Benefit Obligation


	Pension Benefits						SERP Benefits
	2019		2018		2017		2019		2018		2017
The following assumptions were used in calculating the net benefit obligation:

Weighted average discount rate	2.98	%	4.08	%	3.46	%	2.98	%	4.08	%	3.46	%
Rate of increase in future compensation	N/A		N/A		N/A		N/A		N/A		N/A
Lump sum assumed interest rates
First 5 years	2.01	%	3.33	%	2.05	%	N/A		N/A		N/A
Next 15 years	3.06	%	4.39	%	3.61	%	N/A		N/A		N/A
All future years	3.65	%	4.72	%	4.27	%	N/A		N/A		N/A

The following assumptions were used in calculating the net pension expense:

Weighted average discount rate	4.08	%	3.46	%	3.86	%	4.08	%	3.46	%	3.86	%
Rate of increase in future compensation	N/A		N/A		N/A		N/A		N/A		N/A
Expected long-term rate of return	6.50	%	6.50	%	6.50	%	6.50	%	6.50	%	6.50	%

Schedule of Allocation of Plan Assets

The Company's pension plan asset allocation at year-end 2019 and 2018, target allocation for 2020, and expected long-term rate of return by asset category are as follows:


			Percentage of Plan				Weighted
	Target		Assets				Average Expected
	Allocation		at Year End				Long-Term Rate
Asset Category	2020		2019		2018		of Return
Equity securities	55-65	%	61	%	59	%	8.85	%
Debt securities	35-45	%	36	%	40	%	3.00	%
Other	5-10	%	3	%	1	%	0.10	%
Total			100	%	100	%	6.50	%

The Company’s SERP plan asset allocation at year-end 2019 and 2018, target allocation for 2020, and expected long-term rate of return by asset category are as follows:


			Percentage of Plan				Weighted
	Target		Assets				Average Expected
	Allocation		at Year End				Long-Term Rate
Asset Category	2020		2019		2018		of Return
Equity securities	55-65	%	65	%	58	%	8.85	%
Debt securities	35-45	%	34	%	40	%	3.00	%
Other	5-10	%	1	%	2	%	0.10	%
Total			100	%	100	%	6.50	%

Schedule Of Fair Values Of Pension Plan and Postretirement Plan Assets By Asset Category

The fair values of the Company’s pension plan assets at December 31, 2019, by asset category are as follows:


			Quoted Prices
			in Active		Significant		Significant
			Markets for		Observable		Unobservable
			Identical Assets		Inputs		Inputs
Asset Category	Total		(Level 1)		(Level 2)		(Level 3)
(dollars in thousands)
Equity securities - US large cap common stocks	$	912	$	912	$	0	$	0
Equity securities - US mid cap stock mutual funds		115		115		0		0
Equity securities - US small cap stock mutual funds		119		119		0		0
Equity securities - international stock mutual funds		257		257		0		0
Equity securities - emerging markets stock mutual funds		111		111		0		0
Debt securities - intermediate term bond mutual funds		402		402		0		0
Debt securities - short term bond mutual funds		480		480		0		0
Cash - money market account		74		74		0		0
Total	$	2,470	$	2,470	$	0	$	0

The fair values of the Company’s pension plan assets at December 31, 2018, by asset category are as follows:


			Quoted Prices
			in Active		Significant		Significant
			Markets for		Observable		Unobservable
			Identical Assets		Inputs		Inputs
Asset Category	Total		(Level 1)		(Level 2 )		(Level 3)
(dollars in thousands)
Equity securities - US large cap common stocks	$	784	$	784	$	0	$	0
Equity securities - US mid cap stock mutual funds		107		107		0		0
Equity securities - US small cap stock mutual funds		114		114		0		0
Equity securities - international stock mutual funds		225		225		0		0
Equity securities - emerging markets stock mutual funds		49		49		0		0
Debt securities - intermediate term bond mutual funds		309		309		0		0
Debt securities - short term bond mutual funds		543		543		0		0
Cash - money market account		17		17		0		0
Total	$	2,148	$	2,148	$	0	$	0

The fair values of the Company’s SERP assets at December 31, 2019, by asset category are as follows:


			Quoted Prices
			in Active		Significant		Significant
			Markets for		Observable		Unobservable
			Identical Assets		Inputs		Inputs
Asset Category	Total		(Level 1)		(Level 2 )		(Level 3)
(dollars in thousands)
Equity securities - US large cap common stocks	$	353	$	353	$	0	$	0
Equity securities - US mid cap stock mutual funds		46		46		0		0
Equity securities - US small cap stock mutual funds		47		47		0		0
Equity securities - emerging markets stock mutual funds		43		43		0		0
Equity securities - international stock mutual funds		100		100		0		0
Debt securities - intermediate term bond mutual funds		156		156		0		0
Debt securities - short term bond mutual funds		155		155		0		0
Cash - money market account		13		13		0		0
Total	$	913	$	913	$	0	$	0

The fair values of the Company's SERP assets at December 31, 2018, by asset category are as follows:


			Quoted Prices
			in Active		Significant		Significant
			Markets for		Observable		Unobservable
			Identical Assets		Inputs		Inputs
Asset Category	Total		(Level 1)		(Level 2)		(Level 3)
(dollars in thousands)
Equity securities - US large cap common stocks	$	322	$	322	$	0	$	0
Equity securities - US mid cap stock mutual funds		43		43		0		0
Equity securities - US small cap stock mutual funds		43		43		0		0
Equity securities - emerging markets stock mutual funds		18		18		0		0
Equity securities - international stock mutual funds		89		89		0		0
Debt securities - intermediate term bond mutual funds		123		123		0		0
Debt securities - short term bond mutual funds		231		231		0		0
Cash - money market account		15		15		0		0
Total	$	884	$	884	$	0	$	0

Schedule of Expected Benefit Payments

The following benefit payments are expected to be paid over the next ten years:


	Pension		SERP
Plan Year	Benefits		Benefits
(dollars in thousands)
2020	$	259	$	132
2021		220		126
2022		228		120
2023		205		112
2024		202		103
2025-2029		870		364

LAND, PREMISES AND EQUIPMENT, NET - Summary of Land, Premises And Equipment (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
LAND, PREMISES AND EQUIPMENT, NET
Land	$ 12,511	$ 12,302
Premises and improvements	53,213	49,064
Equipment and furniture	38,691	36,111
Total cost	104,415	97,477
Less accumulated depreciation	44,261	39,380
Land, premises and equipment, net	$ 60,154	$ 58,097

PENSION AND OTHER POSTRETIREMENT PLANS (Schedule of Allocation of Plan Assets) (Details)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Equity Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Target Allocation	60.00%
Weighted Average Expected Long-Term Rate of Return	8.85%
Debt Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Target Allocation	40.00%
Weighted Average Expected Long-Term Rate of Return	3.00%
Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Percentage of Plan Assets	100.00%	100.00%
Weighted Average Expected Long-Term Rate of Return	6.50%	6.50%	6.50%
Pension Benefits \| Equity Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Percentage of Plan Assets	61.00%	59.00%
Weighted Average Expected Long-Term Rate of Return	8.85%
Pension Benefits \| Equity Securities [Member] \| Minimum
Defined Benefit Plan Disclosure [Line Items]
Target Allocation	55.00%
Pension Benefits \| Equity Securities [Member] \| Maximum
Defined Benefit Plan Disclosure [Line Items]
Target Allocation	65.00%
Pension Benefits \| Debt Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Percentage of Plan Assets	36.00%	40.00%
Weighted Average Expected Long-Term Rate of Return	3.00%
Pension Benefits \| Debt Securities [Member] \| Minimum
Defined Benefit Plan Disclosure [Line Items]
Target Allocation	35.00%
Pension Benefits \| Debt Securities [Member] \| Maximum
Defined Benefit Plan Disclosure [Line Items]
Target Allocation	45.00%
Pension Benefits \| Other Debt Obligations [Member]
Defined Benefit Plan Disclosure [Line Items]
Percentage of Plan Assets	3.00%	1.00%
Weighted Average Expected Long-Term Rate of Return	0.10%
Pension Benefits \| Other Debt Obligations [Member] \| Minimum
Defined Benefit Plan Disclosure [Line Items]
Target Allocation	5.00%
Pension Benefits \| Other Debt Obligations [Member] \| Maximum
Defined Benefit Plan Disclosure [Line Items]
Target Allocation	10.00%
SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Percentage of Plan Assets	100.00%	100.00%
Weighted Average Expected Long-Term Rate of Return	6.50%	6.50%	6.50%
SERP Benefits \| Equity Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Percentage of Plan Assets	65.00%	58.00%
Weighted Average Expected Long-Term Rate of Return	8.85%
SERP Benefits \| Equity Securities [Member] \| Minimum
Defined Benefit Plan Disclosure [Line Items]
Target Allocation	55.00%
SERP Benefits \| Equity Securities [Member] \| Maximum
Defined Benefit Plan Disclosure [Line Items]
Target Allocation	65.00%
SERP Benefits \| Debt Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Percentage of Plan Assets	34.00%	40.00%
Weighted Average Expected Long-Term Rate of Return	3.00%
SERP Benefits \| Debt Securities [Member] \| Minimum
Defined Benefit Plan Disclosure [Line Items]
Target Allocation	35.00%
SERP Benefits \| Debt Securities [Member] \| Maximum
Defined Benefit Plan Disclosure [Line Items]
Target Allocation	45.00%
SERP Benefits \| Other Debt Obligations [Member]
Defined Benefit Plan Disclosure [Line Items]
Percentage of Plan Assets	1.00%	2.00%
Weighted Average Expected Long-Term Rate of Return	0.10%
SERP Benefits \| Other Debt Obligations [Member] \| Minimum
Defined Benefit Plan Disclosure [Line Items]
Target Allocation	5.00%
SERP Benefits \| Other Debt Obligations [Member] \| Maximum
Defined Benefit Plan Disclosure [Line Items]
Target Allocation	10.00%

LOANS - Additional information (Details) - USD ($)	Dec. 31, 2019	Dec. 31, 2018
LOANS
Mortgage Loans in Process of Foreclosure, Amount	$ 1,600,000	$ 586,000

PENSION AND OTHER POSTRETIREMENT PLANS - Schedule of Expected Benefit Payments (Details) $ in Thousands	Dec. 31, 2019 USD ($)
Pension Benefits
2020	$ 259
2021	220
2022	228
2023	205
2024	202
2025-2029	870
SERP Benefits
2020	132
2021	126
2022	120
2023	112
2024	103
2025-2029	$ 364

LOANS (Tables)

12 Months Ended

Dec. 31, 2019

LOANS

Schedule of Loans

Total loans outstanding as of the years ended December 31, 2019 and 2018 consisted of the following:


(dollars in thousands)	2019		2018
Commercial and industrial loans:
Working capital lines of credit loans	$	709,849	$	690,620
Non-working capital loans		717,019		714,759
Total commercial and industrial loans		1,426,868		1,405,379

Commercial real estate and multi-family residential loans:
Construction and land development loans		287,641		266,805
Owner occupied loans		573,665		586,325
Nonowner occupied loans		571,364		520,901
Multi-family loans		240,652		195,604
Total commercial real estate and multi-family residential loans		1,673,322		1,569,635

Agri-business and agricultural loans:
Loans secured by farmland		174,380		177,503
Loans for agricultural production		205,151		193,010
Total agri-business and agricultural loans		379,531		370,513

Other commercial loans		112,302		95,657
Total commercial loans		3,592,023		3,441,184

Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		177,227		185,822
Open end and junior lien loans		186,552		187,030
Residential construction and land development loans		12,966		16,226
Total consumer 1-4 family mortgage loans		376,745		389,078

Other consumer loans		98,617		86,064
Total consumer loans		475,362		475,142
Gross loans		4,067,385		3,916,326
Less: Allowance for loan losses		(50,652)		(48,453)
Net deferred loan fees		(1,557)		(1,581)
Loans, net	$	4,015,176	$	3,866,292

EARNINGS PER SHARE (Tables)

12 Months Ended

Dec. 31, 2019

EARNINGS PER SHARE

Schedule of weighted average number of shares

Following are the factors used in the earnings per share computations:


(dollars in thousand except share and per share data)	2019		2018		2017
Basic earnings per common share:
Net income	$	87,047	$	80,411	$	57,330
Weighted-average common shares outstanding		25,588,404		25,288,533		25,181,208
Basic earnings per common share	$	3.40	$	3.18	$	2.28
Diluted earnings per common share:
Net income	$	87,047	$	80,411	$	57,330
Weighted-average common shares outstanding for basic earnings per common share		25,588,404		25,288,533		25,181,208
Add: Dilutive effect of assumed exercise of warrant		0		225,831		219,273
Add: Dilutive effect of assumed exercises of stock options and awards		170,489		213,467		262,900
Average shares and dilutive potential common shares		25,758,893		25,727,831		25,663,381
Diluted earnings per common share	$	3.38	$	3.13	$	2.23

SECURITIES - Securities With Unrealized Losses (Details) $ in Thousands	Dec. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
Number of securities with unrealized losses
Number of available-for-sale securities in unrealized loss positions, less than 12 months	19	40
Number of available-for-sale securities in unrealized loss positions, 12 months or more	6	207
Available-for-sale, Securities in Unrealized Loss Positions, Number of Positions	25	247
Debt securities with credit losses recognized in income	$ 0	$ 0	$ 0
US Treasury Securities
Number of securities with unrealized losses
Number of available-for-sale securities in unrealized loss positions, less than 12 months		0
Number of available-for-sale securities in unrealized loss positions, 12 months or more		1
Available-for-sale, Securities in Unrealized Loss Positions, Number of Positions		1
US Government Sponsored Agencies
Number of securities with unrealized losses
Number of available-for-sale securities in unrealized loss positions, less than 12 months		0
Number of available-for-sale securities in unrealized loss positions, 12 months or more		2
Available-for-sale, Securities in Unrealized Loss Positions, Number of Positions		2
Mortgage-backed securities residential
Number of securities with unrealized losses
Number of available-for-sale securities in unrealized loss positions, less than 12 months	7	5
Number of available-for-sale securities in unrealized loss positions, 12 months or more	6	84
Available-for-sale, Securities in Unrealized Loss Positions, Number of Positions	13	89
Mortgage-backed securities commercial
Number of securities with unrealized losses
Number of available-for-sale securities in unrealized loss positions, less than 12 months	1	0
Number of available-for-sale securities in unrealized loss positions, 12 months or more	0	9
Available-for-sale, Securities in Unrealized Loss Positions, Number of Positions	1	9
State and Municipal Securities
Number of securities with unrealized losses
Number of available-for-sale securities in unrealized loss positions, less than 12 months	11	35
Number of available-for-sale securities in unrealized loss positions, 12 months or more	0	111
Available-for-sale, Securities in Unrealized Loss Positions, Number of Positions	11	146

CAPITAL REQUIREMENTS AND RESTRICTIONS ON RETAINED EARNINGS - Additional Information (Details) $ in Millions	12 Months Ended
	Dec. 31, 2019 USD ($)
CAPITAL REQUIREMENTS AND RESTRICTIONS ON RETAINED EARNINGS
Statutory Accounting Practices, Statutory Amount Available for Dividend Payments	$ 89.1
Description of Regulatory Requirements, Capital Adequacy Purposes	Under the Basel III rules, the Company must hold a capital conservation buffer above the adequately capitalized risk-based capital ratios. The capital conservation buffer is being phased in from 0.000% for 2015 to 2.50% by 2019. The capital conservation buffer for 2019 and 2018 was 2.50% and 1.875%, respectively. The net unrealized gain or loss on available-for-sale securities is not included in computing regulatory capital

SECURITIES

12 Months Ended

Dec. 31, 2019

SECURITIES

SECURITIES

NOTE 2 – SECURITIES

Information related to the fair value and amortized cost of securities available-for-sale and the related gross unrealized gains and losses recognized in accumulated other comprehensive income (loss) at December 31 is provided in the tables below.


			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
(dollars in thousands)	Cost		Gain		Losses		Value
2019
Mortgage-backed securities: residential	$	283,817	$	4,751	$	(387)	$	288,181
Mortgage-backed securities: commercial		36,712		262		(2)		36,972
State and municipal securities		270,480		12,828		(228)		283,080
Total	$	591,009	$	17,841	$	(617)	$	608,233

2018
U.S. Treasury securities	$	994	$	0	$	(7)	$	987
U.S. government sponsored agencies		4,435		0		(85)		4,350
Mortgage-backed securities: residential		329,516		1,392		(5,496)		325,412
Mortgage-backed securities: commercial		38,712		0		(571)		38,141
State and municipal securities		217,964		1,403		(2,708)		216,659
Total	$	591,621	$	2,795	$	(8,867)	$	585,549

NOTE 2 – SECURITIES (continued)

Information regarding the fair value and amortized cost of available-for-sale debt securities by maturity as of December 31, 2019, is presented below. Maturity information is based on contractual maturity for all securities other than mortgage-backed securities. Actual maturities of securities may differ from contractual maturities because borrowers may have the right to prepay the obligation without prepayment penalty.


	Amortized		Fair
(dollars in thousands)	Cost		Value
Due in one year or less	$	4,587	$	4,610
Due after one year through five years		15,115		15,453
Due after five years through ten years		24,962		26,061
Due after ten years		225,816		236,956
		270,480		283,080
Mortgage-backed securities		320,529		325,153
Total debt securities	$	591,009	$	608,233

Security proceeds, gross gains and gross losses for 2019, 2018 and 2017 were as follows:


(dollars in thousands)	2019		2018		2017
Sales of securities available-for-sale
Proceeds	$	57,114	$	15,302	$	40,877
Gross gains		279		21		267
Gross losses		(137)		(71)		(235)
Number of securities		46		29		50

Securities with carrying values of $59.3 million and $164.7 million were pledged as of December 31, 2019 and 2018, respectively, as collateral for securities sold under agreements to repurchase, borrowings from the FHLB and for other purposes as permitted or required by law.

Information regarding securities with unrealized losses as of December 31, 2019 and 2018, is presented below. The tables distribute the securities between those with unrealized losses for less than twelve months and those with unrealized losses for twelve months or more.


	Less than 12 months				12 months or more				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(dollars in thousands)	Value		Losses		Value		Losses		Value		Losses
2019
Mortgage-backed securities: residential	$	23,436	$	112	$	14,174	$	275	$	37,610	$	387
Mortgage-backed securities: commercial		4,591		2		0		0		4,591		2
State and municipal securities		14,188		228		0		0		14,188		228
Total temporarily impaired	$	42,215	$	342	$	14,174	$	275	$	56,389	$	617

2018
U.S. Treasury securities	$	0	$	0	$	987	$	7	$	987	$	7
U.S. government sponsored agencies		0		0		4,350		85		4,350		85
Mortgage-backed securities: residential		11,619		12		217,182		5,484		228,801		5,496
Mortgage-backed securities: commercial		0		0		38,141		571		38,141		571
State and municipal securities		26,229		124		85,982		2,584		112,211		2,708
Total temporarily impaired	$	37,848	$	136	$	346,642	$	8,731	$	384,490	$	8,867

NOTE 2 – SECURITIES (continued)

The number of securities with unrealized losses as of December 31, 2019 and 2018 is presented below.


	Less than	12 months
	12 months	or more	Total
2019
Mortgage-backed securities: residential	7	6	13
Mortgage-backed securities: commercial	1	0	1
State and municipal securities	11	0	11
Total temporarily impaired	19	6	25

2018
U.S. Treasury securities	0	1	1
U.S. government sponsored agencies	0	2	2
Mortgage-backed securities: residential	5	84	89
Mortgage-backed securities: commercial	0	9	9
State and municipal securities	35	111	146
Total temporarily impaired	40	207	247

There were no debt securities with credit losses recognized in income during 2019, 2018 or 2017.

Ninety-nine percent of the securities are backed by the U.S. government, government agencies, government sponsored agencies or are rated above investment grade, except for certain non-local or local municipal securities, which are not rated. For the government, government-sponsored agency and municipal securities, management did not have concerns of credit losses and there was nothing to indicate that full principal will not be received. Management considered the unrealized losses on these securities to be primarily interest rate driven and does not expect material losses given current market conditions unless the securities are sold. However, at this time management does not have the intent to sell and it is more likely than not that it will not be required to sell these securities before the recovery of their amortized cost basis.

The Company does not have a history of actively trading securities, but keeps the securities available-for-sale should liquidity for interest rate risk management or other needs develop that would warrant the sale of securities. While these securities are held in the available-for-sale portfolio, it is management’s current intent and ability to hold them until a recovery in fair value or maturity.

ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY (Tables)

12 Months Ended

Dec. 31, 2019

ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY

Schedule of Allowance For Loan Losses and Recorded Investment In Loans By Portfolio Segment

The following tables present the activity and balance in the allowance for loan losses by portfolio segment for the year ended December 31, 2019, 2018 and 2017:

Commercial

Real Estate

Commercial

and

Agri-business

Consumer

and

Multi-family

and

Other

1-4 Family

Other

(dollars in thousands)

Industrial

Residential

Agricultural

Commercial

Mortgage

Consumer

Unallocated

Total

December 31, 2019

Beginning balance

22,518

15,393

4,305

368

2,292

283

3,294

48,453

Provision for loan losses

4,259

259

(444)

(219)

275

(974)

3,235

Loans charged-off

(1,447)

(17)

(110)

(336)

(1,910)

Recoveries

459

161

123

874

Net loans (charged-off) recovered

(988)

144

(213)

(1,036)

Ending balance

25,789

15,796

3,869

447

2,086

345

2,320

50,652


			Commercial
			Real Estate
	Commercial		and		Agri-business				Consumer
	and		Multi-family		and		Other		1-4 Family		Other
(dollars in thousands)	Industrial		Residential		Agricultural		Commercial		Mortgage		Consumer		Unallocated		Total
December 31, 2018
Beginning balance	$	21,097	$	14,714	$	4,920	$	577	$	2,768	$	379	$	2,666	$	47,121
Provision for loan losses		5,884		1,140		(657)		(209)		(536)		150		628		6,400
Loans charged-off		(5,215)		(491)		0		0		(48)		(357)		0		(6,111)
Recoveries		752		30		42		0		108		111		0		1,043
Net loans (charged-off) recovered		(4,463)		(461)		42		0		60		(246)		0		(5,068)
Ending balance	$	22,518	$	15,393	$	4,305	$	368	$	2,292	$	283	$	3,294	$	48,453


			Commercial
			Real Estate
	Commercial		and		Agri-business				Consumer
	and		Multi-family		and		Other		1-4 Family		Other
(dollars in thousands)	Industrial		Residential		Agricultural		Commercial		Mortgage		Consumer		Unallocated		Total
December 31, 2017
Beginning balance	$	20,272	$	13,452	$	3,532	$	461	$	2,827	$	387	$	2,787	$	43,718
Provision for loan losses		614		997		1,365		116		(105)		134		(121)		3,000
Loans charged-off		(842)		(406)		0		0		(53)		(259)		0		(1,560)
Recoveries		1,053		671		23		0		99		117		0		1,963
Net loans (charged-off) recovered		211		265		23		0		46		(142)		0		403
Ending balance	$	21,097	$	14,714	$	4,920	$	577	$	2,768	$	379	$	2,666	$	47,121

NOTE 4 - ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY (continued)

The following tables present balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method as of December 31, 2019 and 2018:

Commercial

Real Estate

Commercial

and

Agri-business

Consumer

and

Multi-family

and

Other

1-4 Family

Other

(dollars in thousands)

Industrial

Residential

Agricultural

Commercial

Mortgage

Consumer

Unallocated

Total

December 31, 2019

Allowance for loan losses:

Ending allowance balance attributable to loans:

Individually evaluated for impairment

9,324

538

426

10,384

Collectively evaluated for impairment

16,465

15,258

3,779

447

1,660

339

2,320

40,268

Total ending allowance balance

25,789

15,796

3,869

447

2,086

345

2,320

50,652

Loans:

Loans individually evaluated for impairment

19,580

4,998

445

2,789

27,829

Loans collectively evaluated for impairment

1,407,246

1,665,842

379,186

112,166

375,210

98,349

4,037,999

Total ending loans balance

1,426,826

1,670,840

379,631

112,166

377,999

98,366

4,065,828


			Commercial
			Real Estate
	Commercial		and		Agri-business				Consumer
	and		Multi-family		and		Other		1-4 Family		Other
(dollars in thousands)	Industrial		Residential		Agricultural		Commercial		Mortgage		Consumer		Unallocated		Total
December 31, 2018
Allowance for loan losses:
Ending allowance balance attributable to loans:
Individually evaluated for impairment	$	8,552	$	921	$	73	$	0	$	457	$	26	$	0	$	10,029
Collectively evaluated for impairment		13,966		14,472		4,232		368		1,835		257		3,294		38,424
Total ending allowance balance	$	22,518	$	15,393	$	4,305	$	368	$	2,292	$	283	$	3,294	$	48,453

Loans:
Loans individually evaluated for impairment	$	19,734	$	4,266	$	433	$	0	$	2,240	$	44	$	0	$	26,717
Loans collectively evaluated for impairment		1,385,604		1,562,899		370,174		95,520		388,053		85,778		0		3,888,028
Total ending loans balance	$	1,405,338	$	1,567,165	$	370,607	$	95,520	$	390,293	$	85,822	$	0	$	3,914,745

Schedule of Loans individually evaluated for impairment

The following table presents loans individually evaluated for impairment by class of loans as of December 31, 2019:


	Unpaid				Allowance for
	Principal		Recorded		Loan Losses
(dollars in thousands)	Balance		Investment		Allocated
With no related allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans	$	22	$	22	$	0
Non-working capital loans		2,130		735		0
Commercial real estate and multi-family residential loans:
Owner occupied loans		3,189		3,010		0
Agri-business and agricultural loans:
Loans secured by farmland		603		283		0
Loans for ag production		15		15		0
Consumer 1-4 family loans:
Closed end first mortgage loans		411		330		0
Open end and junior lien loans		121		121		0
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans		6,214		6,214		3,089
Non-working capital loans		13,230		12,609		6,235
Commercial real estate and multi-family residential loans:
Owner occupied loans		1,988		1,988		538
Agri-business and agricultural loans:
Loans secured by farmland		147		147		90
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		1,643		1,646		363
Open end and junior lien loans		641		640		53
Residential construction loans		51		52		10
Other consumer loans		17		17		6
Total	$	30,422	$	27,829	$	10,384

NOTE 4 - ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY (continued)

The following table presents loans individually evaluated for impairment by class of loans as of December 31, 2018:


	Unpaid				Allowance for
	Principal		Recorded		Loan Losses
(dollars in thousands)	Balance		Investment		Allocated
With no related allowance recorded:
Commercial and industrial loans:
Non-working capital loans	$	3,284	$	1,889	$	0
Commercial real estate and multi-family residential loans:
Owner occupied loans		1,773		1,527		0
Agri-business and agricultural loans:
Loans secured by farmland		603		283		0
Consumer 1-4 family loans:
Closed end first mortgage loans		583		502		0
Open end and junior lien loans		220		220		0
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans		9,691		6,694		2,602
Non-working capital loans		11,099		11,151		5,950
Commercial real estate and multi-family residential loans:
Construction and land development loans		291		291		142
Owner occupied loans		2,938		2,448		779
Agri-business and agricultural loans:
Loans secured by farmland		150		150		73
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		1,517		1,518		457
Other consumer loans		45		44		26
Total	$	32,194	$	26,717	$	10,029

NOTE 4 - ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY (continued)

The following table presents loans individually evaluated for impairment by class of loans for the year ended December 31, 2019:


					Cash Basis
	Average		Interest		Interest
	Recorded		Income		Income
(dollars in thousands)	Investment		Recognized		Recognized
With no related allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans	$	176	$	9	$	9
Non-working capital loans		1,170		40		30
Commercial real estate and multi-family residential loans:
Owner occupied loans		2,354		34		34
Agri-business and agricultural loans:
Loans secured by farmland		283		0		0
Loans for ag production		4		0		0
Consumer 1-4 family loans:
Closed end first mortgage loans		272		3		3
Open end and junior lien loans		133		0		0
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans		6,335		143		81
Non-working capital loans		11,800		448		410
Commercial real estate and multi-family residential loans:
Owner occupied loans		1,849		43		39
Agri-business and agricultural loans:
Loans secured by farmland		147		3		1
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		1,643		45		43
Open end and junior lien loans		268		0		0
Residential construction loans		9		0		0
Other consumer loans		21		2		1
Total	$	26,464	$	770	$	651

NOTE 4 - ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY (continued)

The following table presents loans individually evaluated for impairment by class of loans for the year ended December 31, 2018:


					Cash Basis
	Average		Interest		Interest
	Recorded		Income		Income
(dollars in thousands)	Investment		Recognized		Recognized
With no related allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans	$	785	$	26	$	23
Non-working capital loans		1,862		74		68
Commercial real estate and multi-family residential loans:
Construction and land development loans		58		5		4
Owner occupied loans		2,291		36		37
Agri-business and agricultural loans:
Loans secured by farmland		283		0		0
Consumer 1-4 family loans:
Closed end first mortgage loans		521		13		12
Open end and junior lien loans		205		0		0
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans		3,307		74		12
Non-working capital loans		5,328		138		81
Commercial real estate and multi-family residential loans:
Construction and land development loans		453		26		29
Owner occupied loans		1,631		9		1
Agri-business and agricultural loans:
Loans secured by farmland		12		1		0
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		1,214		37		36
Open end and junior lien loans		38		0		0
Other consumer loans		47		3		3
Total	$	18,035	$	442	$	306

NOTE 4 - ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY (continued)

The following table presents loans individually evaluated for impairment by class of loans for the year ended December 31, 2017:


					Cash Basis
	Average		Interest		Interest
	Recorded		Income		Income
(dollars in thousands)	Investment		Recognized		Recognized
With no related allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans	$	407	$	46	$	39
Non-working capital loans		1,341		57		51
Commercial real estate and multi-family residential loans:
Construction and land development loans		110		5		5
Owner occupied loans		2,349		17		15
Nonowner occupied loans		3,009		294		284
Agri-business and agricultural loans:
Loans secured by farmland		287		0		0
Consumer 1‑4 family loans:
Closed end first mortgage loans		293		9		8
Open end and junior lien loans		103		0		0
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans		2,083		17		17
Non-working capital loans		5,715		103		103
Commercial real estate and multi-family residential loans:
Construction and land development loans		69		5		0
Owner occupied loans		1,664		3		2
Agri-business and agricultural loans:
Loans secured by farmland		2		0		0
Consumer 1‑4 family mortgage loans:
Closed end first mortgage loans		1,006		25		22
Open end and junior lien loans		80		0		0
Other consumer loans		52		3		3
Total	$	18,570	$	584	$	549

Schedule of Aging of the Recorded Investment in Past Due Loans

NOTE 4 - ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY (continued)

The following table presents the aging of the recorded investment in past due loans as of December 31, 2019 by class of loans:

Greater than

30‑89

90 Days Past

Total Past

Loans Not

Days

Due and Still

Due and

(dollars in thousands)

Past Due

Accruing

Nonaccrual

Total

Commercial and industrial loans:

Working capital lines of credit loans

703,737

6,236

6,246

709,983

Non-working capital loans

710,557

6,282

6,286

716,843

Commercial real estate and multi-family residential loans:

Construction and land development loans

286,534

Owner occupied loans

569,303

4,056

573,359

Nonowner occupied loans

570,687

Multi-family loans

240,260

Agri-business and agricultural loans:

Loans secured by farmland

173,959

430

174,389

Loans for agricultural production

205,228

205,242

Other commercial loans

112,166

Consumer 1-4 family mortgage loans:

Closed end first mortgage loans

174,902

1,099

827

1,971

176,873

Open end and junior lien loans

187,255

188

761

949

188,204

Residential construction loans

12,870

12,922

Other consumer loans

98,176

173

190

98,366

Total

4,045,634

1,474

18,675

20,194

4,065,828

NOTE 4 - ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY (continued)

The following table presents the aging of the recorded investment in past due loans as of December 31, 2018 by class of loans:


					Greater than
			30‑89		90 Days Past				Total Past
	Loans Not		Days		Due and Still				Due and
(dollars in thousands)	Past Due		Past Due		Accruing		Nonaccrual		Nonaccrual		Total
Commercial and industrial loans:
Working capital lines of credit loans	$	684,191	$	4,328	$	0	$	2,245	$	6,573	$	690,764
Non-working capital loans		709,629		3,368		0		1,577		4,945		714,574
Commercial real estate and multi-family residential loans:
Construction and land development loans		265,544		0		0		0		0		265,544
Owner occupied loans		583,214		486		0		2,269		2,755		585,969
Nonowner occupied loans		520,431		57		0		0		57		520,488
Multi-family loans		195,164		0		0		0		0		195,164
Agri-business and agricultural loans:
Loans secured by farmland		177,080		150		0		283		433		177,513
Loans for agricultural production		193,094		0		0		0		0		193,094
Other commercial loans		95,520		0		0		0		0		95,520
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		183,420		1,370		0		671		2,041		185,461
Open end and junior lien loans		188,320		98		0		220		318		188,638
Residential construction loans		16,194		0		0		0		0		16,194
Other consumer loans		85,654		168		0		0		168		85,822
Total	$	3,897,455	$	10,025	$	0	$	7,265	$	17,290	$	3,914,745

Schedule of Troubled Debt Restructuring


(dollars in thousands)	2019		2018
Accruing troubled debt restructured loans	$	5,909	$	8,016
Nonaccrual troubled debt restructured loans		3,188		4,384
Total troubled debt restructured loans	$	9,097	$	12,400

Schedule of Loans by Class Modified as Troubled Debt Restructurings

The following table presents loans by class modified as new troubled debt restructurings that occurred during the year ending December 31, 2019:


						Modified Repayment Terms
		Pre-Modification		Post-Modification			Extension
		Outstanding		Outstanding			Period or
	Number of	Recorded		Recorded		Number of	Range
(dollars in thousands)	Loans	Investment		Investment		Loans	(in months)
Troubled Debt Restructurings Commercial and industrial loans:
Working capital lines of credit loans	1	$	35	$	35	1	1
Total	1	$	35	$	35	1	1

The following table presents loans by class modified as new troubled debt restructurings that occurred during the year ending December 31, 2018:


						Modified Repayment Terms
		Pre-Modification		Post-Modification			Extension
		Outstanding		Outstanding			Period or
	Number of	Recorded		Recorded		Number of	Range
(dollars in thousands)	Loans	Investment		Investment		Loans	(in months)
Troubled Debt Restructurings Commercial and industrial loans:
Working capital lines of credit loans	1	$	600	$	600	1	0
Non-working capital loans	7		4,628		4,628	7	0‑6
Commercial real estate and multi-family residential loans:
Construction and land development loans	1		824		824	1	12
Owner occupied loans	2		933		933	2	12
Consumer 1-4 family loans:
Closed end first mortgage loans	1		198		197	1	239
Total	12	$	7,183	$	7,182	12	0‑239

The following table presents loans by class modified as new troubled debt restructurings that occurred during the year ending December 31, 2017:


						Modified Repayment Terms
		Pre-Modification		Post-Modification			Extension
		Outstanding		Outstanding			Period or
	Number of	Recorded		Recorded		Number of	Range
(dollars in thousands)	Loans	Investment		Investment		Loans	(in months)
Troubled Debt Restructurings Commercial and industrial loans:
Working capital lines of credit loans	1	$	1,324	$	1,324	1	9
Non-working capital loans	4		1,922		1,922	4	0‑6
Commercial real estate and multi-family residential loans:
Owner occupied loans	1		486		486	1	6
Consumer 1-4 family loans:
Closed end first mortgage loans	2		120		122	2	198‑350
Total	8	$	3,852	$	3,854	8	0‑350

Schedule of Loans Modified as Troubled Debt Restructurings which were Payment Default with in Tweleve Months Following the Modification Terms


	2019			2018			2017
	Number of	Recorded		Number of	Recorded		Number of	Recorded
(dollars in thousands)	Loans	Investment		Loans	Investment		Loans	Investment
Troubled Debt Restructurings that Subsequently Defaulted Commercial and industrial loans:
Non-working capital loans	1	$	601	0	$	0	0	$	0
Total	1	$	601	0	$	0	0	$	0

Schedule of Credit Quality Indicators

As of December 31, 2019, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:

Special

Not

(dollars in thousands)

Pass

Mention

Substandard

Doubtful

Rated

Total

Commercial and industrial loans:

Working capital lines of credit loans

631,728

40,551

37,278

426

709,983

Non-working capital loans

673,370

18,782

19,381

5,310

716,843

Commercial real estate and multi-family residential loans:

Construction and land development loans

286,534

Owner occupied loans

535,496

14,804

23,059

573,359

Nonowner occupied loans

569,315

781

591

570,687

Multi-family loans

240,260

Agri-business and agricultural loans:

Loans secured by farmland

165,005

7,952

1,432

174,389

Loans for agricultural production

191,489

13,738

205,242

Other commercial loans

112,166

Consumer 1-4 family mortgage loans:

Closed end first mortgage loans

47,405

1,976

127,492

176,873

Open end and junior lien loans

10,845

762

176,597

188,204

Residential construction loans

12,871

12,922

Other consumer loans

27,250

71,099

98,366

Total

3,490,863

96,608

84,562

393,795

4,065,828

As of December 31, 2018, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:


			Special						Not
(dollars in thousands)	Pass		Mention		Substandard		Doubtful		Rated		Total
Commercial and industrial loans:
Working capital lines of credit loans	$	618,612	$	43,240	$	28,563	$	0	$	349	$	690,764
Non-working capital loans		664,787		15,992		27,548		0		6,247		714,574
Commercial real estate and multi-family residential loans:
Construction and land development loans		264,900		353		291		0		0		265,544
Owner occupied loans		541,734		21,864		22,371		0		0		585,969
Nonowner occupied loans		517,356		2,491		641		0		0		520,488
Multi-family loans		194,948		216		0		0		0		195,164
Agri-business and agricultural loans:
Loans secured by farmland		166,623		9,107		1,783		0		0		177,513
Loans for agricultural production		183,189		8,155		1,750		0		0		193,094
Other commercial loans		95,516		0		0		0		4		95,520
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		54,879		0		2,021		0		128,561		185,461
Open end and junior lien loans		8,810		0		220		0		179,608		188,638
Residential construction loans		0		0		0		0		16,194		16,194
Other consumer loans		12,700		0		44		0		73,078		85,822
Total	$	3,324,054	$	101,418	$	85,232	$	0	$	404,041	$	3,914,745

ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY - Aging Of The Recorded Investment In Past Due Loans (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Financing Receivable, Recorded Investment, Aging [Abstract]
Loans Not Past Due	$ 4,045,634	$ 3,897,455
30 to 89 Days Past Due	1,474	10,025
90 Days Past Due and Still Accruing	45	0
Nonaccrual	18,675	7,265
Total Past Due and Nonaccural	20,194	17,290
Total	4,065,828	3,914,745
Other Commercial Loans
Financing Receivable, Recorded Investment, Aging [Abstract]
Loans Not Past Due	112,166	95,520
30 to 89 Days Past Due	0	0
Nonaccrual	0	0
Total Past Due and Nonaccural	0	0
Total	112,166	95,520
Other Commercial Loans \| Greater than 90 Days Past Due [Member]
Financing Receivable, Recorded Investment, Aging [Abstract]
90 Days Past Due and Still Accruing	0	0
Commercial and Industrial Loans
Financing Receivable, Recorded Investment, Aging [Abstract]
Total	1,426,826	1,405,338
Commercial and Industrial Loans \| Working capital lines of credit loans
Financing Receivable, Recorded Investment, Aging [Abstract]
Loans Not Past Due	703,737	684,191
30 to 89 Days Past Due	10	4,328
Nonaccrual	6,236	2,245
Total Past Due and Nonaccural	6,246	6,573
Total	709,983	690,764
Commercial and Industrial Loans \| Working capital lines of credit loans \| Greater than 90 Days Past Due [Member]
Financing Receivable, Recorded Investment, Aging [Abstract]
90 Days Past Due and Still Accruing	0	0
Commercial and Industrial Loans \| Non-working capital loans
Financing Receivable, Recorded Investment, Aging [Abstract]
Loans Not Past Due	710,557	709,629
30 to 89 Days Past Due	4	3,368
Nonaccrual	6,282	1,577
Total Past Due and Nonaccural	6,286	4,945
Total	716,843	714,574
Commercial and Industrial Loans \| Non-working capital loans \| Greater than 90 Days Past Due [Member]
Financing Receivable, Recorded Investment, Aging [Abstract]
90 Days Past Due and Still Accruing	0	0
Commercial Real Estate and Multi-family Residential Loans
Financing Receivable, Recorded Investment, Aging [Abstract]
Total	1,670,840	1,567,165
Commercial Real Estate and Multi-family Residential Loans \| Construction and land development loans
Financing Receivable, Recorded Investment, Aging [Abstract]
Loans Not Past Due	286,534	265,544
30 to 89 Days Past Due	0	0
Nonaccrual	0	0
Total Past Due and Nonaccural	0	0
Total	286,534	265,544
Commercial Real Estate and Multi-family Residential Loans \| Construction and land development loans \| Greater than 90 Days Past Due [Member]
Financing Receivable, Recorded Investment, Aging [Abstract]
90 Days Past Due and Still Accruing	0	0
Commercial Real Estate and Multi-family Residential Loans \| Owner occupied loans
Financing Receivable, Recorded Investment, Aging [Abstract]
Loans Not Past Due	569,303	583,214
30 to 89 Days Past Due	0	486
Nonaccrual	4,056	2,269
Total Past Due and Nonaccural	4,056	2,755
Total	573,359	585,969
Commercial Real Estate and Multi-family Residential Loans \| Owner occupied loans \| Greater than 90 Days Past Due [Member]
Financing Receivable, Recorded Investment, Aging [Abstract]
90 Days Past Due and Still Accruing	0	0
Commercial Real Estate and Multi-family Residential Loans \| Nonowner occupied loans
Financing Receivable, Recorded Investment, Aging [Abstract]
Loans Not Past Due	570,687	520,431
30 to 89 Days Past Due	0	57
Nonaccrual	0	0
Total Past Due and Nonaccural	0	57
Total	570,687	520,488
Commercial Real Estate and Multi-family Residential Loans \| Nonowner occupied loans \| Greater than 90 Days Past Due [Member]
Financing Receivable, Recorded Investment, Aging [Abstract]
90 Days Past Due and Still Accruing	0	0
Commercial Real Estate and Multi-family Residential Loans \| Multi-family loans
Financing Receivable, Recorded Investment, Aging [Abstract]
Loans Not Past Due	240,260	195,164
30 to 89 Days Past Due	0	0
Nonaccrual	0	0
Total Past Due and Nonaccural	0	0
Total	240,260	195,164
Commercial Real Estate and Multi-family Residential Loans \| Multi-family loans \| Greater than 90 Days Past Due [Member]
Financing Receivable, Recorded Investment, Aging [Abstract]
90 Days Past Due and Still Accruing	0	0
Agri-business and Agricultural Loans
Financing Receivable, Recorded Investment, Aging [Abstract]
Total	379,631	370,607
Agri-business and Agricultural Loans \| Loans secured by farmland
Financing Receivable, Recorded Investment, Aging [Abstract]
Loans Not Past Due	173,959	177,080
30 to 89 Days Past Due	0	150
Nonaccrual	430	283
Total Past Due and Nonaccural	430	433
Total	174,389	177,513
Agri-business and Agricultural Loans \| Loans secured by farmland \| Greater than 90 Days Past Due [Member]
Financing Receivable, Recorded Investment, Aging [Abstract]
90 Days Past Due and Still Accruing	0	0
Agri-business and Agricultural Loans \| Loans for agricultural production
Financing Receivable, Recorded Investment, Aging [Abstract]
Loans Not Past Due	205,228	193,094
30 to 89 Days Past Due	0	0
Nonaccrual	14	0
Total Past Due and Nonaccural	14	0
Total	205,242	193,094
Agri-business and Agricultural Loans \| Loans for agricultural production \| Greater than 90 Days Past Due [Member]
Financing Receivable, Recorded Investment, Aging [Abstract]
90 Days Past Due and Still Accruing	0	0
Consumer 1-4 Family Mortgage Loans
Financing Receivable, Recorded Investment, Aging [Abstract]
Total	377,999	390,293
Consumer 1-4 Family Mortgage Loans \| Closed end first mortgage loans
Financing Receivable, Recorded Investment, Aging [Abstract]
Loans Not Past Due	174,902	183,420
30 to 89 Days Past Due	1,099	1,370
90 Days Past Due and Still Accruing	45	0
Nonaccrual	827	671
Total Past Due and Nonaccural	1,971	2,041
Total	176,873	185,461
Consumer 1-4 Family Mortgage Loans \| Open end and junior lien loans
Financing Receivable, Recorded Investment, Aging [Abstract]
Loans Not Past Due	187,255	188,320
30 to 89 Days Past Due	188	98
Nonaccrual	761	220
Total Past Due and Nonaccural	949	318
Total	188,204	188,638
Consumer 1-4 Family Mortgage Loans \| Open end and junior lien loans \| Greater than 90 Days Past Due [Member]
Financing Receivable, Recorded Investment, Aging [Abstract]
90 Days Past Due and Still Accruing	0	0
Consumer 1-4 Family Mortgage Loans \| Residential construction loans
Financing Receivable, Recorded Investment, Aging [Abstract]
Loans Not Past Due	12,870	16,194
30 to 89 Days Past Due	0	0
Nonaccrual	52	0
Total Past Due and Nonaccural	52	0
Total	12,922	16,194
Consumer 1-4 Family Mortgage Loans \| Residential construction loans \| Greater than 90 Days Past Due [Member]
Financing Receivable, Recorded Investment, Aging [Abstract]
90 Days Past Due and Still Accruing	0	0
Consumer 1-4 Family Mortgage Loans \| Other consumer loans
Financing Receivable, Recorded Investment, Aging [Abstract]
Loans Not Past Due	98,176	85,654
30 to 89 Days Past Due	173	168
Nonaccrual	17	0
Total Past Due and Nonaccural	190	168
Total	98,366	85,822
Consumer 1-4 Family Mortgage Loans \| Other consumer loans \| Greater than 90 Days Past Due [Member]
Financing Receivable, Recorded Investment, Aging [Abstract]
90 Days Past Due and Still Accruing	$ 0	$ 0

LOANS - Total Loans Outstanding (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Loans outstanding
Gross loans	$ 4,067,385	$ 3,916,326
Less: Allowance for loan losses	(50,652)	(48,453)	$ (47,121)	$ (43,718)
Net deferred loan fees	(1,557)	(1,581)
Loans, net	4,015,176	3,866,292
Commercial Portfolio Segment
Loans outstanding
Gross loans	3,592,023	3,441,184
Other consumer loans
Loans outstanding
Gross loans	98,617	86,064
Consumer loan open-ended revolving line
Loans outstanding
Gross loans	475,362	475,142
Commercial and Industrial Loans
Loans outstanding
Less: Allowance for loan losses	(25,789)	(22,518)	(21,097)	(20,272)
Commercial and Industrial Loans \| Commercial Portfolio Segment
Loans outstanding
Gross loans	1,426,868	1,405,379
Commercial and Industrial Loans \| Working capital lines of credit loans
Loans outstanding
Gross loans	709,849	690,620
Commercial and Industrial Loans \| Non-working capital loans
Loans outstanding
Gross loans	717,019	714,759
Commercial Real Estate and Multi-family Residential Loans \| Commercial Portfolio Segment
Loans outstanding
Gross loans	1,673,322	1,569,635
Commercial Real Estate and Multi-family Residential Loans \| Construction and land development loans
Loans outstanding
Gross loans	287,641	266,805
Commercial Real Estate and Multi-family Residential Loans \| Owner occupied loans
Loans outstanding
Gross loans	573,665	586,325
Commercial Real Estate and Multi-family Residential Loans \| Nonowner occupied loans
Loans outstanding
Gross loans	571,364	520,901
Commercial Real Estate and Multi-family Residential Loans \| Multi-family loans
Loans outstanding
Gross loans	240,652	195,604
Agri-business and Agricultural Loans
Loans outstanding
Less: Allowance for loan losses	(3,869)	(4,305)	$ (4,920)	$ (3,532)
Agri-business and Agricultural Loans \| Commercial Portfolio Segment
Loans outstanding
Gross loans	379,531	370,513
Agri-business and Agricultural Loans \| Loans secured by farmland \| Commercial Portfolio Segment
Loans outstanding
Gross loans	174,380	177,503
Agri-business and Agricultural Loans \| Loans for agricultural production \| Commercial Portfolio Segment
Loans outstanding
Gross loans	205,151	193,010
Other Commercial Loans \| Commercial Portfolio Segment
Loans outstanding
Gross loans	112,302	95,657
Total Consumer 1 To 4 Family Mortgage Loans
Loans outstanding
Gross loans	376,745	389,078
Total Consumer 1 To 4 Family Mortgage Loans \| Closed end first mortgage loans
Loans outstanding
Gross loans	177,227	185,822
Total Consumer 1 To 4 Family Mortgage Loans \| Open end and junior lien loans
Loans outstanding
Gross loans	186,552	187,030
Total Consumer 1 To 4 Family Mortgage Loans \| Residential construction and land development loans
Loans outstanding
Gross loans	$ 12,966	$ 16,226

WARRANT (Details) - USD ($)		1 Months Ended		12 Months Ended
WARRANT (Details) - USD ($)	Feb. 04, 2019	Nov. 18, 2009	Feb. 27, 2009	Dec. 31, 2018	Feb. 08, 2019
Summary of Warrants
Share Price			$ 17.45
Fair Value Assumptions, Exercise Price			$ 21.20
Fair Value Assumptions, Risk Free Interest Rate			3.02%
Fair Value Assumptions, Expected Term			10 years
Fair Value Assumptions, Expected Dividend Rate			4.5759%
Fair Value Assumptions, Expected Volatility Rate			41.8046%
Issue Of Warrant Stock Purchase			396,538
Issue Of Warrants Aggregate Purchase Price Of Stock			$ 56,044,000
Warrant Period			10 years
Warrant Exercise Price Per Share			$ 21.20	$ 13.3503
Warrant Fair Value Per Share	$ 45.74		$ 4.4433
Adjustments In Share Capital Warrants Issue		198,269
Shares Issuable Upon Exercise Of Warrants				314,846
Number of shares of common stock entitled by warrant holders	315,961				224,066
Cost to exercise the Warrant	$ 4,200,000
Number of shares of common stock for warrants	91,894
Series A Preferred Stock [Member]
Summary of Warrants
Preferred Stock, Shares Issued			56,044

SELECTED QUARTERLY DATA (UNAUDITED)

12 Months Ended

Dec. 31, 2019

SELECTED QUARTERLY DATA (UNAUDITED)

SELECTED QUARTERLY DATA (UNAUDITED)

NOTE 22 – SELECTED QUARTERLY DATA (UNAUDITED) (in thousands except per share data)

4th

3rd

2nd

1st

2019

Quarter

Interest income

52,312

54,769

54,635

53,494

Interest expense

13,430

15,224

16,224

15,285

Net interest income

38,882

39,545

38,411

38,209

Provision for loan losses

250

1,000

785

1,200

Net interest income after provision

38,632

38,545

37,626

37,009

Noninterest income

11,119

10,765

11,588

11,525

Noninterest expense

22,122

22,737

22,092

22,473

Income tax expense

5,431

5,119

5,409

4,379

Net income

22,198

21,454

21,713

21,682

Basic earnings per common share

0.86

0.84

0.85

Diluted earnings per common share

0.86

0.83

0.85

0.84


	4th		3rd		2nd		1st
2018	Quarter		Quarter		Quarter		Quarter
Interest income	$	53,728	$	50,379	$	48,795	$	46,068
Interest expense		14,138		12,454		11,262		9,845
Net interest income		39,590		37,925		37,533		36,223
Provision for loan losses		300		1,100		1,700		3,300
Net interest income after provision		39,290		36,825		35,833		32,923
Noninterest income		10,077		10,624		9,722		9,879
Noninterest expense		22,524		22,200		20,303		21,202
Income tax expense		5,480		4,679		5,110		3,264
Net income	$	21,363	$	20,570	$	20,142	$	18,336

Basic earnings per common share	$	0.84	$	0.81	$	0.80	$	0.73
Diluted earnings per common share	$	0.83	$	0.80	$	0.79	$	0.71

OFFSETTING ASSETS AND LIABILITIES - Schedule of Offsetting of Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Assets
Gross Amounts of Recognized Assets	$ 7,263	$ 3,869
Gross Amounts Offset in the Statement of Financial Position	0	0
Net Amounts of Assets presented in the Statement of Financial Position	7,263	3,869
Gross Amounts Not Offset in the Statement of Financial Position, Financial Instruments	0	0
Gross Amounts Not Offset in the Statement of Financial Position, Cash Collateral Received	0	(760)
Net Amount	7,263	3,109
Liabilities
Gross Amounts of Recognized Liabilities	7,860	79,580
Gross Amounts Offset in the Statement of Financial Position	0	0
Net Amounts of Liabilities presented in the Statement of Financial Position	7,860	79,580
Gross Amounts Not Offset in the Statement of Financial Position, Financial Instruments	0	(75,555)
Gross Amounts Not Offset in the Statement of Financial Position, Cash Collateral Received	(7,560)	(560)
Net Amount	300	3,465
Interest Rate Swap [Member]
Assets
Gross Amounts of Recognized Assets	7,263	3,869
Gross Amounts Offset in the Statement of Financial Position	0	0
Net Amounts of Assets presented in the Statement of Financial Position	7,263	3,869
Gross Amounts Not Offset in the Statement of Financial Position, Financial Instruments	0	0
Gross Amounts Not Offset in the Statement of Financial Position, Cash Collateral Received	0	(760)
Net Amount	7,263	3,109
Liabilities
Gross Amounts of Recognized Liabilities	7,860	4,025
Gross Amounts Offset in the Statement of Financial Position	0	0
Net Amounts of Liabilities presented in the Statement of Financial Position	7,860	4,025
Gross Amounts Not Offset in the Statement of Financial Position, Financial Instruments	0	0
Gross Amounts Not Offset in the Statement of Financial Position, Cash Collateral Received	(7,560)	(560)
Net Amount	300	3,465
Repurchase Agreements [Member]
Liabilities
Gross Amounts of Recognized Liabilities	0	75,555
Gross Amounts Offset in the Statement of Financial Position	0	0
Net Amounts of Liabilities presented in the Statement of Financial Position	0	75,555
Gross Amounts Not Offset in the Statement of Financial Position, Financial Instruments	0	(75,555)
Gross Amounts Not Offset in the Statement of Financial Position, Cash Collateral Received	0	0
Net Amount	$ 0	$ 0

ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY

12 Months Ended

Dec. 31, 2019

ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY

ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY

NOTE 4 – ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY

The following tables present the activity and balance in the allowance for loan losses by portfolio segment for the year ended December 31, 2019, 2018 and 2017:

Commercial

Real Estate

Commercial

and

Agri-business

Consumer

and

Multi-family

and

Other

1-4 Family

Other

(dollars in thousands)

Industrial

Residential

Agricultural

Commercial

Mortgage

Consumer

Unallocated

Total

December 31, 2019

Beginning balance

22,518

15,393

4,305

368

2,292

283

3,294

48,453

Provision for loan losses

4,259

259

(444)

(219)

275

(974)

3,235

Loans charged-off

(1,447)

(17)

(110)

(336)

(1,910)

Recoveries

459

161

123

874

Net loans (charged-off) recovered

(988)

144

(213)

(1,036)

Ending balance

25,789

15,796

3,869

447

2,086

345

2,320

50,652


			Commercial
			Real Estate
	Commercial		and		Agri-business				Consumer
	and		Multi-family		and		Other		1-4 Family		Other
(dollars in thousands)	Industrial		Residential		Agricultural		Commercial		Mortgage		Consumer		Unallocated		Total
December 31, 2018
Beginning balance	$	21,097	$	14,714	$	4,920	$	577	$	2,768	$	379	$	2,666	$	47,121
Provision for loan losses		5,884		1,140		(657)		(209)		(536)		150		628		6,400
Loans charged-off		(5,215)		(491)		0		0		(48)		(357)		0		(6,111)
Recoveries		752		30		42		0		108		111		0		1,043
Net loans (charged-off) recovered		(4,463)		(461)		42		0		60		(246)		0		(5,068)
Ending balance	$	22,518	$	15,393	$	4,305	$	368	$	2,292	$	283	$	3,294	$	48,453


			Commercial
			Real Estate
	Commercial		and		Agri-business				Consumer
	and		Multi-family		and		Other		1-4 Family		Other
(dollars in thousands)	Industrial		Residential		Agricultural		Commercial		Mortgage		Consumer		Unallocated		Total
December 31, 2017
Beginning balance	$	20,272	$	13,452	$	3,532	$	461	$	2,827	$	387	$	2,787	$	43,718
Provision for loan losses		614		997		1,365		116		(105)		134		(121)		3,000
Loans charged-off		(842)		(406)		0		0		(53)		(259)		0		(1,560)
Recoveries		1,053		671		23		0		99		117		0		1,963
Net loans (charged-off) recovered		211		265		23		0		46		(142)		0		403
Ending balance	$	21,097	$	14,714	$	4,920	$	577	$	2,768	$	379	$	2,666	$	47,121

NOTE 4 - ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY (continued)

The following tables present balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method as of December 31, 2019 and 2018:

Commercial

Real Estate

Commercial

and

Agri-business

Consumer

and

Multi-family

and

Other

1-4 Family

Other

(dollars in thousands)

Industrial

Residential

Agricultural

Commercial

Mortgage

Consumer

Unallocated

Total

December 31, 2019

Allowance for loan losses:

Ending allowance balance attributable to loans:

Individually evaluated for impairment

9,324

538

426

10,384

Collectively evaluated for impairment

16,465

15,258

3,779

447

1,660

339

2,320

40,268

Total ending allowance balance

25,789

15,796

3,869

447

2,086

345

2,320

50,652

Loans:

Loans individually evaluated for impairment

19,580

4,998

445

2,789

27,829

Loans collectively evaluated for impairment

1,407,246

1,665,842

379,186

112,166

375,210

98,349

4,037,999

Total ending loans balance

1,426,826

1,670,840

379,631

112,166

377,999

98,366

4,065,828


			Commercial
			Real Estate
	Commercial		and		Agri-business				Consumer
	and		Multi-family		and		Other		1-4 Family		Other
(dollars in thousands)	Industrial		Residential		Agricultural		Commercial		Mortgage		Consumer		Unallocated		Total
December 31, 2018
Allowance for loan losses:
Ending allowance balance attributable to loans:
Individually evaluated for impairment	$	8,552	$	921	$	73	$	0	$	457	$	26	$	0	$	10,029
Collectively evaluated for impairment		13,966		14,472		4,232		368		1,835		257		3,294		38,424
Total ending allowance balance	$	22,518	$	15,393	$	4,305	$	368	$	2,292	$	283	$	3,294	$	48,453

Loans:
Loans individually evaluated for impairment	$	19,734	$	4,266	$	433	$	0	$	2,240	$	44	$	0	$	26,717
Loans collectively evaluated for impairment		1,385,604		1,562,899		370,174		95,520		388,053		85,778		0		3,888,028
Total ending loans balance	$	1,405,338	$	1,567,165	$	370,607	$	95,520	$	390,293	$	85,822	$	0	$	3,914,745

NOTE 4 - ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY (continued)

The following table presents loans individually evaluated for impairment by class of loans as of December 31, 2019:


	Unpaid				Allowance for
	Principal		Recorded		Loan Losses
(dollars in thousands)	Balance		Investment		Allocated
With no related allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans	$	22	$	22	$	0
Non-working capital loans		2,130		735		0
Commercial real estate and multi-family residential loans:
Owner occupied loans		3,189		3,010		0
Agri-business and agricultural loans:
Loans secured by farmland		603		283		0
Loans for ag production		15		15		0
Consumer 1-4 family loans:
Closed end first mortgage loans		411		330		0
Open end and junior lien loans		121		121		0
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans		6,214		6,214		3,089
Non-working capital loans		13,230		12,609		6,235
Commercial real estate and multi-family residential loans:
Owner occupied loans		1,988		1,988		538
Agri-business and agricultural loans:
Loans secured by farmland		147		147		90
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		1,643		1,646		363
Open end and junior lien loans		641		640		53
Residential construction loans		51		52		10
Other consumer loans		17		17		6
Total	$	30,422	$	27,829	$	10,384

NOTE 4 - ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY (continued)

The following table presents loans individually evaluated for impairment by class of loans as of December 31, 2018:


	Unpaid				Allowance for
	Principal		Recorded		Loan Losses
(dollars in thousands)	Balance		Investment		Allocated
With no related allowance recorded:
Commercial and industrial loans:
Non-working capital loans	$	3,284	$	1,889	$	0
Commercial real estate and multi-family residential loans:
Owner occupied loans		1,773		1,527		0
Agri-business and agricultural loans:
Loans secured by farmland		603		283		0
Consumer 1-4 family loans:
Closed end first mortgage loans		583		502		0
Open end and junior lien loans		220		220		0
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans		9,691		6,694		2,602
Non-working capital loans		11,099		11,151		5,950
Commercial real estate and multi-family residential loans:
Construction and land development loans		291		291		142
Owner occupied loans		2,938		2,448		779
Agri-business and agricultural loans:
Loans secured by farmland		150		150		73
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		1,517		1,518		457
Other consumer loans		45		44		26
Total	$	32,194	$	26,717	$	10,029

NOTE 4 - ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY (continued)

The following table presents loans individually evaluated for impairment by class of loans for the year ended December 31, 2019:


					Cash Basis
	Average		Interest		Interest
	Recorded		Income		Income
(dollars in thousands)	Investment		Recognized		Recognized
With no related allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans	$	176	$	9	$	9
Non-working capital loans		1,170		40		30
Commercial real estate and multi-family residential loans:
Owner occupied loans		2,354		34		34
Agri-business and agricultural loans:
Loans secured by farmland		283		0		0
Loans for ag production		4		0		0
Consumer 1-4 family loans:
Closed end first mortgage loans		272		3		3
Open end and junior lien loans		133		0		0
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans		6,335		143		81
Non-working capital loans		11,800		448		410
Commercial real estate and multi-family residential loans:
Owner occupied loans		1,849		43		39
Agri-business and agricultural loans:
Loans secured by farmland		147		3		1
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		1,643		45		43
Open end and junior lien loans		268		0		0
Residential construction loans		9		0		0
Other consumer loans		21		2		1
Total	$	26,464	$	770	$	651

NOTE 4 - ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY (continued)

The following table presents loans individually evaluated for impairment by class of loans for the year ended December 31, 2018:


					Cash Basis
	Average		Interest		Interest
	Recorded		Income		Income
(dollars in thousands)	Investment		Recognized		Recognized
With no related allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans	$	785	$	26	$	23
Non-working capital loans		1,862		74		68
Commercial real estate and multi-family residential loans:
Construction and land development loans		58		5		4
Owner occupied loans		2,291		36		37
Agri-business and agricultural loans:
Loans secured by farmland		283		0		0
Consumer 1-4 family loans:
Closed end first mortgage loans		521		13		12
Open end and junior lien loans		205		0		0
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans		3,307		74		12
Non-working capital loans		5,328		138		81
Commercial real estate and multi-family residential loans:
Construction and land development loans		453		26		29
Owner occupied loans		1,631		9		1
Agri-business and agricultural loans:
Loans secured by farmland		12		1		0
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		1,214		37		36
Open end and junior lien loans		38		0		0
Other consumer loans		47		3		3
Total	$	18,035	$	442	$	306

NOTE 4 - ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY (continued)

The following table presents loans individually evaluated for impairment by class of loans for the year ended December 31, 2017:


					Cash Basis
	Average		Interest		Interest
	Recorded		Income		Income
(dollars in thousands)	Investment		Recognized		Recognized
With no related allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans	$	407	$	46	$	39
Non-working capital loans		1,341		57		51
Commercial real estate and multi-family residential loans:
Construction and land development loans		110		5		5
Owner occupied loans		2,349		17		15
Nonowner occupied loans		3,009		294		284
Agri-business and agricultural loans:
Loans secured by farmland		287		0		0
Consumer 1‑4 family loans:
Closed end first mortgage loans		293		9		8
Open end and junior lien loans		103		0		0
With an allowance recorded:
Commercial and industrial loans:
Working capital lines of credit loans		2,083		17		17
Non-working capital loans		5,715		103		103
Commercial real estate and multi-family residential loans:
Construction and land development loans		69		5		0
Owner occupied loans		1,664		3		2
Agri-business and agricultural loans:
Loans secured by farmland		2		0		0
Consumer 1‑4 family mortgage loans:
Closed end first mortgage loans		1,006		25		22
Open end and junior lien loans		80		0		0
Other consumer loans		52		3		3
Total	$	18,570	$	584	$	549

Nonaccrual loans and loans past due 90 days still on accrual include both smaller balance homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans.

NOTE 4 - ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY (continued)

The following table presents the aging of the recorded investment in past due loans as of December 31, 2019 by class of loans:

Greater than

30‑89

90 Days Past

Total Past

Loans Not

Days

Due and Still

Due and

(dollars in thousands)

Past Due

Accruing

Nonaccrual

Total

Commercial and industrial loans:

Working capital lines of credit loans

703,737

6,236

6,246

709,983

Non-working capital loans

710,557

6,282

6,286

716,843

Commercial real estate and multi-family residential loans:

Construction and land development loans

286,534

Owner occupied loans

569,303

4,056

573,359

Nonowner occupied loans

570,687

Multi-family loans

240,260

Agri-business and agricultural loans:

Loans secured by farmland

173,959

430

174,389

Loans for agricultural production

205,228

205,242

Other commercial loans

112,166

Consumer 1-4 family mortgage loans:

Closed end first mortgage loans

174,902

1,099

827

1,971

176,873

Open end and junior lien loans

187,255

188

761

949

188,204

Residential construction loans

12,870

12,922

Other consumer loans

98,176

173

190

98,366

Total

4,045,634

1,474

18,675

20,194

4,065,828

NOTE 4 - ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY (continued)

The following table presents the aging of the recorded investment in past due loans as of December 31, 2018 by class of loans:


					Greater than
			30‑89		90 Days Past				Total Past
	Loans Not		Days		Due and Still				Due and
(dollars in thousands)	Past Due		Past Due		Accruing		Nonaccrual		Nonaccrual		Total
Commercial and industrial loans:
Working capital lines of credit loans	$	684,191	$	4,328	$	0	$	2,245	$	6,573	$	690,764
Non-working capital loans		709,629		3,368		0		1,577		4,945		714,574
Commercial real estate and multi-family residential loans:
Construction and land development loans		265,544		0		0		0		0		265,544
Owner occupied loans		583,214		486		0		2,269		2,755		585,969
Nonowner occupied loans		520,431		57		0		0		57		520,488
Multi-family loans		195,164		0		0		0		0		195,164
Agri-business and agricultural loans:
Loans secured by farmland		177,080		150		0		283		433		177,513
Loans for agricultural production		193,094		0		0		0		0		193,094
Other commercial loans		95,520		0		0		0		0		95,520
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		183,420		1,370		0		671		2,041		185,461
Open end and junior lien loans		188,320		98		0		220		318		188,638
Residential construction loans		16,194		0		0		0		0		16,194
Other consumer loans		85,654		168		0		0		168		85,822
Total	$	3,897,455	$	10,025	$	0	$	7,265	$	17,290	$	3,914,745

NOTE 4 - ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY (continued)

Troubled Debt Restructurings:

Troubled debt restructured loans are included in the totals for impaired loans. The Company has allocated $2.5 million and $3.7 million of specific reserves to customers whose loan terms have been modified in troubled debt restructurings as of December 31, 2019 and 2018. The Company is not committed to lend additional funds to debtors whose loans have been modified in a troubled debt restructuring.


(dollars in thousands)	2019		2018
Accruing troubled debt restructured loans	$	5,909	$	8,016
Nonaccrual troubled debt restructured loans		3,188		4,384
Total troubled debt restructured loans	$	9,097	$	12,400

During the year ending December 31, 2019, certain loans were modified as troubled debt restructurings. The modified terms of these loans include one or a combination of the following: inadequate compensation for the terms of the restructure or renewal; a modification of the repayment terms which delays principal repayment for some period; or renewal terms offered to borrowers in financial distress where no additional credit enhancements were obtained at the time of renewal.

Additional concessions were granted to borrowers during 2019 with previously identified troubled debt restructured loans. There were three commercial real estate loans with recorded investments totaling $1.9 million and five commercial and industrial loans with recorded investments totaling $2.4 million where the collateral values or cash flows were insufficient to support the loans. These troubled debt restructured loans with additional concessions decreased the allowance by $484,000 and resulted in no charge-offs for year ending December 31, 2019. These concessions are not included in the table below.

The following table presents loans by class modified as new troubled debt restructurings that occurred during the year ending December 31, 2019:


						Modified Repayment Terms
		Pre-Modification		Post-Modification			Extension
		Outstanding		Outstanding			Period or
	Number of	Recorded		Recorded		Number of	Range
(dollars in thousands)	Loans	Investment		Investment		Loans	(in months)
Troubled Debt Restructurings Commercial and industrial loans:
Working capital lines of credit loans	1	$	35	$	35	1	1
Total	1	$	35	$	35	1	1

For the period ending December 31, 2019, the working capital line of credit loan troubled debt restructuring described above had no impact to the allowance and no charge-offs were recorded.

During the year ending December 31, 2018, certain loans were modified as troubled debt restructurings. The modified terms of these loans include one or a combination of the following: inadequate compensation for the terms of the restructure or renewal; a modification of the repayment terms which delays principal repayment for some period; or renewal terms offered to borrowers in financial distress where no additional credit enhancements were obtained at the time of renewal.

Additional concessions were granted to borrowers during 2018 with previously identified troubled debt restructured loans. There were three commercial real estate loans with recorded investments totaling $1.3 million and three commercial and industrial loans with recorded investments totaling $1.4 million where the collateral value and/or cash flows do not support those loans. The other three loans are to borrowers for investments in land for residential development which have not had sales activity to support loans with a recorded investments totaling $593,000. These troubled debt restructured loans with additional concessions increased the allowance by $189,000 and resulted in no charge-offs for year ending December 31, 2018. These concessions are not included in the table below.

NOTE 4 - ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY (continued)

The following table presents loans by class modified as new troubled debt restructurings that occurred during the year ending December 31, 2018:


						Modified Repayment Terms
		Pre-Modification		Post-Modification			Extension
		Outstanding		Outstanding			Period or
	Number of	Recorded		Recorded		Number of	Range
(dollars in thousands)	Loans	Investment		Investment		Loans	(in months)
Troubled Debt Restructurings Commercial and industrial loans:
Working capital lines of credit loans	1	$	600	$	600	1	0
Non-working capital loans	7		4,628		4,628	7	0‑6
Commercial real estate and multi-family residential loans:
Construction and land development loans	1		824		824	1	12
Owner occupied loans	2		933		933	2	12
Consumer 1-4 family loans:
Closed end first mortgage loans	1		198		197	1	239
Total	12	$	7,183	$	7,182	12	0‑239

Additional concessions were granted to borrowers during 2017 with previously identified troubled debt restructured loans. There were four loans for commercial real estate buildings where the collateral value and cash flows from the companies occupying the buildings do not support the loans with recorded investments of $1.9 million. There were five loans for commercial and industrial non-working capital loans with recorded investments of $2.5 million. These concessions are not included in table below.

The following table presents loans by class modified as new troubled debt restructurings that occurred during the year ending December 31, 2017:


						Modified Repayment Terms
		Pre-Modification		Post-Modification			Extension
		Outstanding		Outstanding			Period or
	Number of	Recorded		Recorded		Number of	Range
(dollars in thousands)	Loans	Investment		Investment		Loans	(in months)
Troubled Debt Restructurings Commercial and industrial loans:
Working capital lines of credit loans	1	$	1,324	$	1,324	1	9
Non-working capital loans	4		1,922		1,922	4	0‑6
Commercial real estate and multi-family residential loans:
Owner occupied loans	1		486		486	1	6
Consumer 1-4 family loans:
Closed end first mortgage loans	2		120		122	2	198‑350
Total	8	$	3,852	$	3,854	8	0‑350

For the period ending December 31, 2017, the commercial and industrial troubled debt restructurings described above increased the allowance for loan losses by $513,000 and the commercial real estate and multi-family residential loan troubled debt restructurings increased the allowance for loan losses by $27,000. No charge-offs resulted from any troubled debt restructurings described above during the year ended December 31, 2017.

NOTE 4 - ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY (continued)

A loan is considered to be in payment default once it is 30 days contractually past due under the modified terms. The following table presents loans modified as troubled debt restructurings for which there was a payment default within twelve months following the modification during the period ending December 31, 2019, 2018 and 2017.


	2019			2018			2017
	Number of	Recorded		Number of	Recorded		Number of	Recorded
(dollars in thousands)	Loans	Investment		Loans	Investment		Loans	Investment
Troubled Debt Restructurings that Subsequently Defaulted Commercial and industrial loans:
Non-working capital loans	1	$	601	0	$	0	0	$	0
Total	1	$	601	0	$	0	0	$	0

Credit Quality Indicators:

The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Company analyzes commercial loans individually by classifying the loans as to credit risk. This analysis is performed on a quarterly basis for Special Mention, Substandard and Doubtful grade loans and annually on Pass grade loans over $250,000.

The Company uses the following definitions for risk ratings:

Special Mention. Loans classified as Special Mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.

Substandard. Loans classified as Substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized as the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

Doubtful. Loans classified as Doubtful have all the weaknesses inherent in those classified as Substandard, with the added characteristics that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

Loans not meeting the criteria above that are analyzed individually as part of the above-described process are considered to be Pass rated loans with the exception of consumer troubled debt restructurings which are evaluated and listed with Substandard consumer loans and consumer nonaccrual loans which are evaluated individually and listed with Not Rated loans. Loans listed as Not Rated are consumer loans or commercial loans with consumer characteristics included in groups of homogenous loans which are analyzed for credit quality indicators utilizing delinquency status.

NOTE 4 - ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY (continued)

As of December 31, 2019, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:

Special

Not

(dollars in thousands)

Pass

Mention

Substandard

Doubtful

Rated

Total

Commercial and industrial loans:

Working capital lines of credit loans

631,728

40,551

37,278

426

709,983

Non-working capital loans

673,370

18,782

19,381

5,310

716,843

Commercial real estate and multi-family residential loans:

Construction and land development loans

286,534

Owner occupied loans

535,496

14,804

23,059

573,359

Nonowner occupied loans

569,315

781

591

570,687

Multi-family loans

240,260

Agri-business and agricultural loans:

Loans secured by farmland

165,005

7,952

1,432

174,389

Loans for agricultural production

191,489

13,738

205,242

Other commercial loans

112,166

Consumer 1-4 family mortgage loans:

Closed end first mortgage loans

47,405

1,976

127,492

176,873

Open end and junior lien loans

10,845

762

176,597

188,204

Residential construction loans

12,871

12,922

Other consumer loans

27,250

71,099

98,366

Total

3,490,863

96,608

84,562

393,795

4,065,828

As of December 31, 2018, and based on the most recent analysis performed, the risk category of loans by class of loans is as follows:


			Special						Not
(dollars in thousands)	Pass		Mention		Substandard		Doubtful		Rated		Total
Commercial and industrial loans:
Working capital lines of credit loans	$	618,612	$	43,240	$	28,563	$	0	$	349	$	690,764
Non-working capital loans		664,787		15,992		27,548		0		6,247		714,574
Commercial real estate and multi-family residential loans:
Construction and land development loans		264,900		353		291		0		0		265,544
Owner occupied loans		541,734		21,864		22,371		0		0		585,969
Nonowner occupied loans		517,356		2,491		641		0		0		520,488
Multi-family loans		194,948		216		0		0		0		195,164
Agri-business and agricultural loans:
Loans secured by farmland		166,623		9,107		1,783		0		0		177,513
Loans for agricultural production		183,189		8,155		1,750		0		0		193,094
Other commercial loans		95,516		0		0		0		4		95,520
Consumer 1-4 family mortgage loans:
Closed end first mortgage loans		54,879		0		2,021		0		128,561		185,461
Open end and junior lien loans		8,810		0		220		0		179,608		188,638
Residential construction loans		0		0		0		0		16,194		16,194
Other consumer loans		12,700		0		44		0		73,078		85,822
Total	$	3,324,054	$	101,418	$	85,232	$	0	$	404,041	$	3,914,745

INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2019

INCOME TAXES

Scedule of Components of Income Tax Expense

Income tax expense for the years ended December 31, 2019, 2018 and 2017 consisted of the following:


(dollars in thousands)	2019		2018		2017
Current federal	$	19,430	$	16,871	$	27,064
Deferred federal		(408)		707		(199)
Revalue deferred taxes due to tax reform		0		(408)		4,137
Current state		1,394		1,462		1,559
Deferred state		(78)		(99)		(257)
Total income tax expense	$	20,338	$	18,533	$	32,304

Schedule of Differences In Taxes From Continuing Operations


(dollars in thousands)	2019		2018		2017
Income taxes at statutory federal rate of 21% (2019 and 2018) and 35% (2017)	$	22,551	$	20,778	$	31,372
Increase (decrease) in taxes resulting from:
Tax exempt income		(1,682)		(1,434)		(2,015)
Nondeductible expense		194		165		193
State income tax, net of federal tax effect		1,040		1,077		846
Captive insurance premium income		(310)		(292)		(378)
Tax credits		(548)		(412)		(326)
Bank owned life insurance		(573)		(303)		(619)
Long - term incentive plan		(421)		(641)		(854)
Revaluation deferred tax asset at 21% rate		0		(408)		4,137
Other		87		3		(52)
Total income tax expense	$	20,338	$	18,533	$	32,304

Schedule of Deferred Tax Assets and Liabilities

The net deferred tax asset recorded in the consolidated balance sheets at December 31, 2019 and 2018 consisted of the following:


(dollars in thousands)	2019		2018
Deferred tax assets:
Bad debts	$	12,945	$	12,478
Pension and deferred compensation liability		1,505		1,188
Nonaccrual loan interest		1,104		937
Long-term incentive plan		2,281		2,357
Lease liability		1,303		0
Other		510		506
		19,648		17,466
Deferred tax liabilities:
Depreciation		4,741		4,583
Loan servicing rights		1,019		877
State taxes		464		447
Intangible assets		1,270		1,280
REIT spillover dividend		1,401		1,231
Prepaid expenses		795		786
Lease Right of Use		1,303		0
Other		382		475
		11,375		9,679
Valuation allowance		0		0
Net deferred tax asset	$	8,273	$	7,787

PENSION AND OTHER POSTRETIREMENT PLANS - Schedule of Amounts Recognized in Balance Sheet (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Funded status included in other liabilities	$ (243)	$ (33)
SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Funded status included in other liabilities	$ (77)	$ (39)

FAIR VALUE - Assets and Liabilities Measured At Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Assets
Securities available-for-sale	$ 608,233	$ 585,549
Mortgage banking derivative	7,263	3,109
Liabilities
Mortgage banking derivative	300	3,465
Fair Value, Measurements, Recurring
Assets
U.S. Treasury securities		987
U.S. government sponsored agency securities		4,350
Mortgage-backed securities: residential	288,181	325,412
Mortgage-backed securities: commercial	36,972	38,141
State and municipal securities	283,080	216,659
Securities available-for-sale	608,233	585,549
Mortgage banking derivative	198	95
Interest rate swap derivative	7,263	3,869
Total assets	615,694	589,513
Liabilities
Mortgage banking derivative	14	23
Interest rate swap derivative	7,860	4,025
Total liabilities	7,874	4,048
Level 1 \| Fair Value, Measurements, Recurring
Assets
U.S. Treasury securities		987
U.S. government sponsored agency securities		0
Mortgage-backed securities: residential	0	0
Mortgage-backed securities: commercial	0	0
State and municipal securities	0	0
Securities available-for-sale	0	987
Mortgage banking derivative	0	0
Interest rate swap derivative	0	0
Total assets	0	987
Liabilities
Mortgage banking derivative	0	0
Interest rate swap derivative	0	0
Total liabilities	0	0
Level 2 \| Fair Value, Measurements, Recurring
Assets
U.S. Treasury securities		0
U.S. government sponsored agency securities		4,350
Mortgage-backed securities: residential	288,181	325,412
Mortgage-backed securities: commercial	36,972	38,141
State and municipal securities	282,935	216,509
Securities available-for-sale	608,088	584,412
Mortgage banking derivative	198	95
Interest rate swap derivative	7,263	3,869
Total assets	615,549	588,376
Liabilities
Mortgage banking derivative	14	23
Interest rate swap derivative	7,860	4,025
Total liabilities	7,874	4,048
Level 3 \| Fair Value, Measurements, Recurring
Assets
U.S. Treasury securities		0
U.S. government sponsored agency securities		0
Mortgage-backed securities: residential	0	0
Mortgage-backed securities: commercial	0	0
State and municipal securities	145	150
Securities available-for-sale	145	150
Mortgage banking derivative	0	0
Interest rate swap derivative	0	0
Total assets	145	150
Liabilities
Mortgage banking derivative	0	0
Interest rate swap derivative	0	0
Total liabilities	$ 0	$ 0

BORROWINGS - Additional Information (Details) - USD ($) $ in Millions		12 Months Ended
	Aug. 02, 2019	Dec. 31, 2019	Dec. 31, 2018
Debt Instrument [Line Items]
Residential real estate loans and securities pledged as collateral for FHLB advances, carrying value		$ 453.2	$ 412.9
FHLB Stock owned		10.4	10.4
FHLB borrowing capacity, authorized		800.0
Line of Credit Facility, Current Borrowing Capacity		115.5
Commercial loans pledged as collateral for Federal Reserve Discount Window, carrying value		446.9	381.5
Federal Reserve borrowing capacity		339.5	286.5
Secured Debt		170.0
Line of Credit Facility, Remaining Borrowing Capacity		325.0
Unsecured revolving credit agreement
Debt Instrument [Line Items]
Maximum borrowing capacity	$ 30.0
Term of credit agreement	1 year
Amount drawn on the line		0.0
American Financial Exchange
Debt Instrument [Line Items]
Line of Credit Facility, Remaining Borrowing Capacity		$ 244.0	$ 119.0

PARENT COMPANY STATEMENTS - CONDENSED STATEMENTS OF CASH FLOWS (Details) - USD ($)		3 Months Ended								12 Months Ended
	Dec. 31, 2019	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Cash flows from operating activities:
Net income		$ 22,198,000	$ 21,454,000	$ 21,713,000	$ 21,682,000	$ 21,363,000	$ 20,570,000	$ 20,142,000	$ 18,336,000	$ 87,047,000	$ 80,411,000	$ 57,330,000
Adjustments to net cash from operating activities:
Net cash from operating activities										100,039,000	104,975,000	77,242,000
Cash flows from financing activities:
Purchase of treasury stock	$ (928,000)									(515,000)	(463,000)	(495,000)
Sales of treasury stock										118,000	115,000	0
Net cash from financing activities										(48,887,000)	102,209,000	327,708,000
Net change in cash and cash equivalents										(117,541,000)	40,742,000	8,900,000
Cash and cash equivalents at beginning of the year					216,922,000				176,180,000	216,922,000	176,180,000	167,280,000
Cash and cash equivalents at end of the year	99,381,000	99,381,000				216,922,000				99,381,000	216,922,000	176,180,000
Reportable Legal Entities [Member] \| Parent Company [Member]
Cash flows from operating activities:
Net income										87,047,000	80,411,000	57,330,000
Adjustments to net cash from operating activities:
Equity in undistributed income of subsidiaries										(32,533,000)	(56,567,000)	(39,573,000)
Other changes										3,529,000	7,294,000	3,586,000
Net cash from operating activities										58,043,000	31,138,000	21,343,000
Cash flows from financing activities:
Repayment of long-term debt										(30,928,000)	0	0
Payments related to equity incentive plans										(2,109,000)	(2,435,000)	(1,736,000)
Purchase of treasury stock										(515,000)	(463,000)	(495,000)
Sales of treasury stock										118,000	115,000	0
Dividends paid										(29,639,000)	(25,278,000)	(21,396,000)
Net cash from financing activities										(63,073,000)	(28,061,000)	(23,627,000)
Net change in cash and cash equivalents										(5,030,000)	3,077,000	(2,284,000)
Cash and cash equivalents at beginning of the year					$ 8,896,000				$ 5,819,000	8,896,000	5,819,000	8,103,000
Cash and cash equivalents at end of the year	$ 3,866,000	$ 3,866,000				$ 8,896,000				$ 3,866,000	$ 8,896,000	$ 5,819,000

ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY - Troubled Debt Restructurings Subsequently Defaulted (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2019 USD ($) item	Dec. 31, 2018 USD ($) item	Dec. 31, 2017 USD ($) item
Troubled Debt Restructurings
Troubled Debt Restructurings, Subsequently Defaulted , Number of Loans \| item	1	0
Troubled Debt Restructurings, Subsequently Defaulted, Recorded Investment \| $	$ 601	$ 0	$ 0
Non-working capital loans \| Commercial and Industrial Loans
Troubled Debt Restructurings
Troubled Debt Restructurings, Subsequently Defaulted , Number of Loans \| item	1	0	0
Troubled Debt Restructurings, Subsequently Defaulted, Recorded Investment \| $	$ 601	$ 0	$ 0

ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY - Credit Quality Indicators (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	$ 4,065,828	$ 3,914,745
Other Commercial Loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	112,166	95,520
Other Consumer Loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	98,366	85,822
Commercial and Industrial Loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	1,426,826	1,405,338
Commercial and Industrial Loans \| Working capital lines of credit loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	709,983	690,764
Commercial and Industrial Loans \| Non-working capital loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	716,843	714,574
Commercial Real Estate and Multi-family Residential Loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	1,670,840	1,567,165
Commercial Real Estate and Multi-family Residential Loans \| Construction and land development loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	286,534	265,544
Commercial Real Estate and Multi-family Residential Loans \| Owner occupied loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	573,359	585,969
Commercial Real Estate and Multi-family Residential Loans \| Nonowner occupied loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	570,687	520,488
Commercial Real Estate and Multi-family Residential Loans \| Multi-family loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	240,260	195,164
Agri-business and Agricultural Loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	379,631	370,607
Agri-business and Agricultural Loans \| Loans secured by farmland
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	174,389	177,513
Agri-business and Agricultural Loans \| Loans for agricultural production
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	205,242	193,094
Consumer 1-4 Family Mortgage Loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	377,999	390,293
Consumer 1-4 Family Mortgage Loans \| Closed end first mortgage loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	176,873	185,461
Consumer 1-4 Family Mortgage Loans \| Open end and junior lien loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	188,204	188,638
Consumer 1-4 Family Mortgage Loans \| Residential construction loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	12,922	16,194
Pass
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	3,490,863	3,324,054
Pass \| Other Commercial Loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	112,166	95,516
Pass \| Other Consumer Loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	27,250	12,700
Pass \| Commercial and Industrial Loans \| Working capital lines of credit loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	631,728	618,612
Pass \| Commercial and Industrial Loans \| Non-working capital loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	673,370	664,787
Pass \| Commercial Real Estate and Multi-family Residential Loans \| Construction and land development loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	286,534	264,900
Pass \| Commercial Real Estate and Multi-family Residential Loans \| Owner occupied loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	535,496	541,734
Pass \| Commercial Real Estate and Multi-family Residential Loans \| Nonowner occupied loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	569,315	517,356
Pass \| Commercial Real Estate and Multi-family Residential Loans \| Multi-family loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	240,260	194,948
Pass \| Agri-business and Agricultural Loans \| Loans secured by farmland
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	165,005	166,623
Pass \| Agri-business and Agricultural Loans \| Loans for agricultural production
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	191,489	183,189
Pass \| Consumer 1-4 Family Mortgage Loans \| Closed end first mortgage loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	47,405	54,879
Pass \| Consumer 1-4 Family Mortgage Loans \| Open end and junior lien loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	10,845	8,810
Pass \| Consumer 1-4 Family Mortgage Loans \| Residential construction loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Special Mention
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	96,608	101,418
Special Mention \| Other Commercial Loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Special Mention \| Other Consumer Loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Special Mention \| Commercial and Industrial Loans \| Working capital lines of credit loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	40,551	43,240
Special Mention \| Commercial and Industrial Loans \| Non-working capital loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	18,782	15,992
Special Mention \| Commercial Real Estate and Multi-family Residential Loans \| Construction and land development loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	353
Special Mention \| Commercial Real Estate and Multi-family Residential Loans \| Owner occupied loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	14,804	21,864
Special Mention \| Commercial Real Estate and Multi-family Residential Loans \| Nonowner occupied loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	781	2,491
Special Mention \| Commercial Real Estate and Multi-family Residential Loans \| Multi-family loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	216
Special Mention \| Agri-business and Agricultural Loans \| Loans secured by farmland
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	7,952	9,107
Special Mention \| Agri-business and Agricultural Loans \| Loans for agricultural production
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	13,738	8,155
Special Mention \| Consumer 1-4 Family Mortgage Loans \| Closed end first mortgage loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Special Mention \| Consumer 1-4 Family Mortgage Loans \| Open end and junior lien loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Special Mention \| Consumer 1-4 Family Mortgage Loans \| Residential construction loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Substandard
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	84,562	85,232
Substandard \| Other Commercial Loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Substandard \| Other Consumer Loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	17	44
Substandard \| Commercial and Industrial Loans \| Working capital lines of credit loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	37,278	28,563
Substandard \| Commercial and Industrial Loans \| Non-working capital loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	19,381	27,548
Substandard \| Commercial Real Estate and Multi-family Residential Loans \| Construction and land development loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	291
Substandard \| Commercial Real Estate and Multi-family Residential Loans \| Owner occupied loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	23,059	22,371
Substandard \| Commercial Real Estate and Multi-family Residential Loans \| Nonowner occupied loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	591	641
Substandard \| Commercial Real Estate and Multi-family Residential Loans \| Multi-family loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Substandard \| Agri-business and Agricultural Loans \| Loans secured by farmland
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	1,432	1,783
Substandard \| Agri-business and Agricultural Loans \| Loans for agricultural production
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	15	1,750
Substandard \| Consumer 1-4 Family Mortgage Loans \| Closed end first mortgage loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	1,976	2,021
Substandard \| Consumer 1-4 Family Mortgage Loans \| Open end and junior lien loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	762	220
Substandard \| Consumer 1-4 Family Mortgage Loans \| Residential construction loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	51	0
Doubtful
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Doubtful \| Other Commercial Loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Doubtful \| Other Consumer Loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Doubtful \| Commercial and Industrial Loans \| Working capital lines of credit loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Doubtful \| Commercial and Industrial Loans \| Non-working capital loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Doubtful \| Commercial Real Estate and Multi-family Residential Loans \| Construction and land development loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Doubtful \| Commercial Real Estate and Multi-family Residential Loans \| Owner occupied loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Doubtful \| Commercial Real Estate and Multi-family Residential Loans \| Nonowner occupied loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Doubtful \| Commercial Real Estate and Multi-family Residential Loans \| Multi-family loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Doubtful \| Agri-business and Agricultural Loans \| Loans secured by farmland
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Doubtful \| Agri-business and Agricultural Loans \| Loans for agricultural production
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Doubtful \| Consumer 1-4 Family Mortgage Loans \| Closed end first mortgage loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Doubtful \| Consumer 1-4 Family Mortgage Loans \| Open end and junior lien loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Doubtful \| Consumer 1-4 Family Mortgage Loans \| Residential construction loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Not Rated
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	393,795	404,041
Not Rated \| Other Commercial Loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	4
Not Rated \| Other Consumer Loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	71,099	73,078
Not Rated \| Commercial and Industrial Loans \| Working capital lines of credit loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	426	349
Not Rated \| Commercial and Industrial Loans \| Non-working capital loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	5,310	6,247
Not Rated \| Commercial Real Estate and Multi-family Residential Loans \| Construction and land development loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Not Rated \| Commercial Real Estate and Multi-family Residential Loans \| Owner occupied loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Not Rated \| Commercial Real Estate and Multi-family Residential Loans \| Nonowner occupied loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Not Rated \| Commercial Real Estate and Multi-family Residential Loans \| Multi-family loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Not Rated \| Agri-business and Agricultural Loans \| Loans secured by farmland
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Not Rated \| Agri-business and Agricultural Loans \| Loans for agricultural production
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	0	0
Not Rated \| Consumer 1-4 Family Mortgage Loans \| Closed end first mortgage loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	127,492	128,561
Not Rated \| Consumer 1-4 Family Mortgage Loans \| Open end and junior lien loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	176,597	179,608
Not Rated \| Consumer 1-4 Family Mortgage Loans \| Residential construction loans
Financing Receivable, Recorded Investment [Line Items]
Total ending loans balance	$ 12,871	$ 16,194

FAIR VALUE - Assets Measured at Fair Value on a Nonrecurring Basis (Details) - Fair Value, Measurements, Nonrecurring - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	$ 12,121	$ 11,506
Other real estate owned	0	316
Total assets	12,121	11,822
Level 1
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	0	0
Other real estate owned	0	0
Total assets	0	0
Level 2
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	0	0
Other real estate owned	0	0
Total assets	0	0
Level 3
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	12,121	11,506
Other real estate owned	0	316
Total assets	12,121	11,822
Other consumer loans
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	11
Other consumer loans \| Level 1
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	0
Other consumer loans \| Level 2
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	0
Other consumer loans \| Level 3
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	11
Commercial and Industrial Loans
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	9,500	9,059
Commercial and Industrial Loans \| Working capital lines of credit loans
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	3,126	4,092
Commercial and Industrial Loans \| Working capital lines of credit loans \| Level 1
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	0	0
Commercial and Industrial Loans \| Working capital lines of credit loans \| Level 2
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	0	0
Commercial and Industrial Loans \| Working capital lines of credit loans \| Level 3
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	3,126	4,092
Commercial and Industrial Loans \| Non-working capital loans
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	6,374	4,967
Commercial and Industrial Loans \| Non-working capital loans \| Level 1
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	0	0
Commercial and Industrial Loans \| Non-working capital loans \| Level 2
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	0	0
Commercial and Industrial Loans \| Non-working capital loans \| Level 3
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	6,374	4,967
Commercial Real Estate and Multi-family Residential Loans
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	1,492	1,817
Commercial Real Estate and Multi-family Residential Loans \| Construction and land development loans
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	43	148
Commercial Real Estate and Multi-family Residential Loans \| Construction and land development loans \| Level 1
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	0	0
Commercial Real Estate and Multi-family Residential Loans \| Construction and land development loans \| Level 2
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	0	0
Commercial Real Estate and Multi-family Residential Loans \| Construction and land development loans \| Level 3
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	43	148
Commercial Real Estate and Multi-family Residential Loans \| Owner occupied loans
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	1,449	1,669
Commercial Real Estate and Multi-family Residential Loans \| Owner occupied loans \| Level 1
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	0	0
Commercial Real Estate and Multi-family Residential Loans \| Owner occupied loans \| Level 2
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	0	0
Commercial Real Estate and Multi-family Residential Loans \| Owner occupied loans \| Level 3
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	1,449	1,669
Consumer 1-4 Family Mortgage Loans
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	1,061	553
Consumer 1-4 Family Mortgage Loans \| Closed end first mortgage loans
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	474	553
Consumer 1-4 Family Mortgage Loans \| Closed end first mortgage loans \| Level 1
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	0	0
Consumer 1-4 Family Mortgage Loans \| Closed end first mortgage loans \| Level 2
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	0	0
Consumer 1-4 Family Mortgage Loans \| Closed end first mortgage loans \| Level 3
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	474	553
Consumer 1-4 Family Mortgage Loans \| Open end and junior lien loans
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	587
Consumer 1-4 Family Mortgage Loans \| Open end and junior lien loans \| Level 1
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	0
Consumer 1-4 Family Mortgage Loans \| Open end and junior lien loans \| Level 2
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	0
Consumer 1-4 Family Mortgage Loans \| Open end and junior lien loans \| Level 3
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	587
Agribusiness and Agricultural
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	57	77
Agribusiness and Agricultural \| Loans secured by farmland
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	57	77
Agribusiness and Agricultural \| Loans secured by farmland \| Level 1
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	0	0
Agribusiness and Agricultural \| Loans secured by farmland \| Level 2
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	0	0
Agribusiness and Agricultural \| Loans secured by farmland \| Level 3
Assets Measured At Fair Value On Nonrecurring Basis [Line Items]
Impaired loans	$ 57	$ 77

PENSION AND OTHER POSTRETIREMENT PLANS - Schedule of Fair Values of Pension Plan and Postretirement Plan Assets by Asset Category (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	$ 2,470	$ 2,148
SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	913	884
Level 1 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	2,470	2,148
Level 1 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	913	884
Level 2 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Level 2 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Level 3 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Level 3 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Equity securities - US large cap common stocks [Member] \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	912	784
Equity securities - US large cap common stocks [Member] \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	353	322
Equity securities - US large cap common stocks [Member] \| Level 1 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	912	784
Equity securities - US large cap common stocks [Member] \| Level 1 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	353	322
Equity securities - US large cap common stocks [Member] \| Level 2 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Equity securities - US large cap common stocks [Member] \| Level 2 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Equity securities - US large cap common stocks [Member] \| Level 3 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Equity securities - US large cap common stocks [Member] \| Level 3 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Equity securities - US mid cap stock mutual funds [Member] \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	115	107
Equity securities - US mid cap stock mutual funds [Member] \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	46	43
Equity securities - US mid cap stock mutual funds [Member] \| Level 1 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	115	107
Equity securities - US mid cap stock mutual funds [Member] \| Level 1 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	46	43
Equity securities - US mid cap stock mutual funds [Member] \| Level 2 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Equity securities - US mid cap stock mutual funds [Member] \| Level 2 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Equity securities - US mid cap stock mutual funds [Member] \| Level 3 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Equity securities - US mid cap stock mutual funds [Member] \| Level 3 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Equity securities - US small cap stock mutual funds [Member] \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	119	114
Equity securities - US small cap stock mutual funds [Member] \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	47	43
Equity securities - US small cap stock mutual funds [Member] \| Level 1 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	119	114
Equity securities - US small cap stock mutual funds [Member] \| Level 1 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	47	43
Equity securities - US small cap stock mutual funds [Member] \| Level 2 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Equity securities - US small cap stock mutual funds [Member] \| Level 2 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Equity securities - US small cap stock mutual funds [Member] \| Level 3 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Equity securities - US small cap stock mutual funds [Member] \| Level 3 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Equity securities - international stock mutual funds [Member] \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	257	225
Equity securities - international stock mutual funds [Member] \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	100	89
Equity securities - international stock mutual funds [Member] \| Level 1 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	257	225
Equity securities - international stock mutual funds [Member] \| Level 1 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	100	89
Equity securities - international stock mutual funds [Member] \| Level 2 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Equity securities - international stock mutual funds [Member] \| Level 2 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Equity securities - international stock mutual funds [Member] \| Level 3 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Equity securities - international stock mutual funds [Member] \| Level 3 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Equity Securities - emerging markets stock mutual funds [Member] \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	111	49
Equity Securities - emerging markets stock mutual funds [Member] \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	43	18
Equity Securities - emerging markets stock mutual funds [Member] \| Level 1 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	111	49
Equity Securities - emerging markets stock mutual funds [Member] \| Level 1 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	43	18
Equity Securities - emerging markets stock mutual funds [Member] \| Level 2 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Equity Securities - emerging markets stock mutual funds [Member] \| Level 2 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Equity Securities - emerging markets stock mutual funds [Member] \| Level 3 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Equity Securities - emerging markets stock mutual funds [Member] \| Level 3 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Debt securities - intermediate term bond mutual funds [Member] \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	402	309
Debt securities - intermediate term bond mutual funds [Member] \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	156	123
Debt securities - intermediate term bond mutual funds [Member] \| Level 1 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	402	309
Debt securities - intermediate term bond mutual funds [Member] \| Level 1 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	156	123
Debt securities - intermediate term bond mutual funds [Member] \| Level 2 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Debt securities - intermediate term bond mutual funds [Member] \| Level 2 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Debt securities - intermediate term bond mutual funds [Member] \| Level 3 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Debt securities - intermediate term bond mutual funds [Member] \| Level 3 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Debt securities - short term bond mutual funds [Member] \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	480	543
Debt securities - short term bond mutual funds [Member] \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	155	231
Debt securities - short term bond mutual funds [Member] \| Level 1 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	480	543
Debt securities - short term bond mutual funds [Member] \| Level 1 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	155	231
Debt securities - short term bond mutual funds [Member] \| Level 2 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Debt securities - short term bond mutual funds [Member] \| Level 2 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Debt securities - short term bond mutual funds [Member] \| Level 3 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Debt securities - short term bond mutual funds [Member] \| Level 3 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Cash - money market account [Member] \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	74	17
Cash - money market account [Member] \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	13	15
Cash - money market account [Member] \| Level 1 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	74	17
Cash - money market account [Member] \| Level 1 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	13	15
Cash - money market account [Member] \| Level 2 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Cash - money market account [Member] \| Level 2 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Cash - money market account [Member] \| Level 3 \| Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	0	0
Cash - money market account [Member] \| Level 3 \| SERP Benefits
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Assets for Plan Benefits	$ 0	$ 0