What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2021-07-30 compared with 2021-04-30 · 233 added, 169 removed, 1143 unchanged (26% of the section changed)

30 unchanged sentences

Less treasury stock, at cost -

at March 31, 2021

at June 30, 2021

and December 31, 2020, respectively

7 unchanged sentences

Consolidated Statements of Earnings

Quarter ended March 31,

Quarter ended June 30,

Six months ended June 30,

(Dollars in thousands, except share and per share data)

31 unchanged sentences

Consolidated Statements of Comprehensive Income

Quarter ended March 31,

Quarter ended June 30,

Six months ended June 30,

(Dollars in thousands)

Other comprehensive (loss) income, net of tax:

Unrealized net holding (loss) gain on securities

Other comprehensive income (loss), net of

Unrealized net holding gain (loss) on securities

Reclassification adjustment for net gain on securities

recognized in net earnings

Other comprehensive (loss) income

Comprehensive (loss) income

Other comprehensive income (loss)

Comprehensive income

See accompanying notes to consolidated financial statements

5 unchanged sentences

(Dollars in thousands, except share data)

Quarter ended March 31, 2021

income (loss)

Quarter ended June 30, 2021

Balance, March 31, 2021

Other comprehensive income

Cash dividends paid ($

Stock repurchases

Sale of treasury stock

Balance, June 30, 2021

Quarter ended June 30, 2020

Balance, March 31, 2020

Other comprehensive income

Cash dividends paid ($

Sale of treasury stock

Balance, June 30, 2020

Six months ended June 30,

Balance, December 31, 2020

1 unchanged sentence

Cash dividends paid ($

Stock repurchases

Sale of treasury stock

Balance, March 31, 2021

Quarter ended March 31, 2020

Balance, June 30, 2021

Six months ended June 30,

Balance, December 31, 2019

1 unchanged sentence

Cash dividends paid ($

Balance, March 31, 2020

Sale of treasury stock

Balance, June 30, 2020

See accompanying notes to consolidated financial statements

3 unchanged sentences

Consolidated Statements of Cash Flows

Quarter ended March 31,

Six months ended June 30,

(Dollars in thousands)

7 unchanged sentences

Net gain on sale of loans held for sale

Net gain on other real estate owned

Loans originated for sale

3 unchanged sentences

Net decrease (increase) in other assets

Net increase (decrease) in accrued expenses and other liabilities

Net decrease in accrued expenses and other liabilities

Net cash provided by operating activities

Cash flows from investing activities:

Proceeds from sales of securities available-for-sale

Proceeds from prepayments and maturities of securities available

Purchase of securities available-for-sale

(Increase) decrease in loans, net

Decrease (increase) in loans, net

Net purchases of premises and equipment

1 unchanged sentence

Decrease (increase) in FHLB stock

Proceeds from sale of other real estate owned

Net cash used in investing activities

4 unchanged sentences

under agreements to repurchase

Stock repurchases

Dividends paid

104 unchanged sentences

and transactions through the date of this filing that have

subsequent to March 31, 2021.

subsequent to June 30, 2021.

The Company does not believe

3 unchanged sentences

Accounting Developments

In the first quarter of 2021, the Company did not adopt any new

In the first six months of 2021, the Company did not adopt any new

accounting guidance.

2 unchanged sentences

by the weighted average common shares outstanding for

the quarters ended March 31, 2021 and 2020, respectively.

Diluted net earnings per share reflect the potential dilution that

could occur upon exercise of securities or other rights for,

or convertible into, shares of the Company’s

common stock.

March 31, 2021 and 2020, respectively,

the Company had no such securities or rights issued

or outstanding, and therefore,

no dilutive effect to consider for the diluted net earnings

per share calculation.

the respective period.

Diluted net earnings per share reflect the potential dilution that could

occur upon exercise of

securities or other rights for, or convertible

into, shares of the Company’s common

At June 30, 2021 and 2020,

respectively, the Company had

no such securities or rights issued or outstanding, and therefore,

no dilutive effect to

consider for the diluted net earnings per share calculation.

The basic and diluted net earnings per share computations for

the respective periods are presented below

Quarter ended March 31,

Quarter ended June 30,

Six months ended June 30,

(Dollars in thousands, except share and per share data)

3 unchanged sentences

Net earnings per share

At March 31, 2021 and December 31, 2020, respectively,

At June 30, 2021 and December 31, 2020, respectively,

all securities within the scope of ASC 320,

Investments – Debt

and Equity Securities,

Investments – Debt and

Equity Securities,

were classified as available-for-sale.

The fair value and amortized cost for securities available-for-

sale by contractual maturity at March 31, 2021 and

December 31, 2020, respectively,

are presented below.

The fair value and amortized cost for securities available-for-sale

by contractual maturity at June 30, 2021 and December 31,

2020, respectively, are presented

Gross Unrealized

(Dollars in thousands)

March 31, 2021

June 30, 2021

Agency obligations (a)

12 unchanged sentences

million and $

million at March 31, 2021 and December 31, 2020,

million at June 30, 2021 and December 31, 2020,

respectively, were pledged to

7 unchanged sentences

million and $

million at March 31, 2021 and

December 31, 2020, respectively.

Non-marketable equity investments include FHLB of Atlanta Stock,

Federal Reserve

Bank (“FRB”) stock, and stock in a privately held financial institution.

million at June 30, 2021 and December

31, 2020, respectively.

Non-marketable equity investments

include FHLB of Atlanta Stock, Federal Reserve Bank

(“FRB”) stock, and stock in a privately held financial institution.

Gross Unrealized Losses and Fair Value

The fair values and gross unrealized losses on securities at March

The fair values and gross unrealized losses on securities at June 30,

2021 and December 31, 2020, respectively,

segregated by those securities that have been in an unrealized

loss position for less than 12 months and 12 months or

longer, are presented below.

by those securities that have been in an unrealized loss position for

less than 12 months and 12 months or longer,

presented below.

Less than 12 Months

1 unchanged sentence

(Dollars in thousands)

March 31, 2021:

June 30, 2021:

Agency obligations

88 unchanged sentences

reductions in the credit loss component of credit-impaired debt

securities during the quarters ended March 31, 2021 and

securities during the quarters ended June 30, 2021 and 2020,

respectively.

2 unchanged sentences

of securities.

Quarter ended March 31,

Quarter ended June 30,

Six months ended June 30,

(Dollars in thousands)

19 unchanged sentences

of the Company’s total loan portfolio

at March 31, 2021.

31, 2021, the Company’s geographic

loan distribution was concentrated primarily in Lee County,

surrounding areas.

at June 30, 2021.

the Company’s geographic loan distribution

was concentrated primarily in Lee County,

Alabama, and surrounding

In accordance with ASC 310, a portfolio segment is defined as the level

14 unchanged sentences

determining credit risk.

The following describes

the risk characteristics relevant to each of the portfolio

segments and classes.

The following describes the risk characteristics relevant to each

of the portfolio segments and classes.

Commercial and industrial (“C&I”) —

5 unchanged sentences

of repayment is the cash flow from business operations and activities

a participating lender in the Paycheck Protection Program (“PPP”).

PPP loans are forgivable in whole or

in part, if the proceeds are used for payroll and other permitted

purposes in accordance with the requirements of the PPP.

As of March 31, 2021, the Company has

We participated

as a lender in the Paycheck Protection Program (“PPP”),

which ended May 31, 2021.

are forgivable in whole or in part, if the proceeds

are used for payroll and other permitted purposes in accordance

requirements of the PPP.

The Company had

PPP loans with an aggregate outstanding principal balance of

included in this category.

million and $

million, included in this category,

as of June 30, 2021 and December 31, 2020, respectively.

Construction and land development (“C&D”) —

54 unchanged sentences

loans are underwritten in accordance

with the Bank’s general loan policies

and procedures which require, among other things, proper

with the Bank’s general loan poli

cies and procedures which require, among other things, proper

documentation of

each borrower’s financial condition, satisfactory credit

and property value.

history, and property

Investment property

16 unchanged sentences

financial condition, satisfactory credit history,

if applicable, property value.

and, if applicable, property value.

The following is a summary of current, accruing past due, and nonaccrual

loans by portfolio segment and class as of March

loans by portfolio segment and class as of June

30, 2021 and December 31, 2020.

(Dollars in thousands)

March 31, 2021:

June 30, 2021:

Commercial and industrial

84 unchanged sentences

As part of the Company’s quarterly assessment

of the allowance, management divides the loan portfol

io into five segments:

of the allowance, management divides the loan portfolio

into five segments:

commercial and industrial, construction and land development, commercial

14 unchanged sentences

may make adjustments based, in part, on loss rates of peer

At March 31, 2021 and December 31, 2020, and for the periods then ended,

the Company adjusted its historical

loss rates for the commercial real estate portfolio segment based,

At June 30, 2021 and December 31, 2020, and for the periods

then ended, the Company adjusted its historical loss

rates for the commercial real estate portfolio segment based,

in part, on loss rates of peer bank groups.

28 unchanged sentences

loan losses and its balance would decrease.

quarter ended March 31, 2021, the Company increased its look

-back period to 48 quarters to continue to include losses

quarter ended June 30, 2021, the Company increased its look-back

period to 49 quarters to continue to include losses

incurred by the Company beginning with the first quarter of 2009.

2 unchanged sentences

economic downturn in its loss history.

adjusted certain qualitative and economic factors related to changes i

During 2020, the Company

adjusted certain qualitative and economic factors related to changes in

economic conditions driven by the impact of the

2 unchanged sentences

unemployment in our primary market area.

During the second quarter of 2021, the Company adjusted

certain qualitative

and economic factors to reflect improvements in economic conditions

in our primary market area.

The following table details the changes in the allowance for loan

losses by portfolio segment for the respective periods.

March 31, 2021

June 30, 2021

(Dollars in thousands)

2 unchanged sentences

Beginning balance

Net recoveries

Net recoveries (charge-offs)

Provision for loan losses

Ending balance

March 31, 2020

Six months ended:

Beginning balance

Net recoveries (charge-offs)

Provision for loan losses

Ending balance

June 30, 2020

(Dollars in thousands)

5 unchanged sentences

Ending balance

Six months ended:

Beginning balance

Net recoveries (charge-offs)

Provision for loan losses

Ending balance

The following table presents an analysis of the allowance for

loan losses and recorded investment in loans by portfolio

segment and impairment methodology as of March 31, 2021

segment and impairment methodology as of June 30, 2021

Collectively evaluated (1)

1 unchanged sentence

(Dollars in thousands)

March 31, 2021:

June 30, 2021:

Commercial and industrial (3)

3 unchanged sentences

Consumer installment

March 31, 2020:

June 30, 2020:

Commercial and industrial (4)

12 unchanged sentences

impaired loans.

Includes $28.7 million of PPP loans for which no loan loss reserve

was allocated due to 100% SBA guarantee.

Includes $22.1 million of PPP loans for which no allowance

for loan losses was allocated due to 100% SBA guarantee.

Includes $36.5 million of PPP loans for which no allowance

for loan losses was allocated due to 100% SBA guarantee.

Credit Quality Indicators

27 unchanged sentences

(Dollars in thousands)

March 31, 2021:

June 30, 2021:

Commercial and industrial

36 unchanged sentences

that were individually evaluated

for impairment at March 31, 2021 and December 31, 2020.

March 31, 2021

for impairment at June 30, 2021 and December 31, 2020.

June 30, 2021

(Dollars in thousands)

51 unchanged sentences

respective periods.

Quarter ended March 31, 2021

Quarter ended March 31, 2020

Quarter ended June 30, 2021

Six months ended June 30, 2021

Total interest

7 unchanged sentences

Total residential real estate

Quarter ended June 30, 2020

Six months ended June 30, 2020

Total interest

(Dollars in thousands)

Impaired loans:

Commercial real estate:

Total commercial real estate

Residential real estate:

Investment property

Total residential real estate

Troubled Debt

2 unchanged sentences

On March 27, 2020, the Coronavirus Aid, Relief, and

Economic Security Act (“CARES

Act”) was signed into law.

4013 of the CARES Act, “Temporary

Economic Security Act (“CARES Act”) was signed into law.

Section 4013 of the CARES Act, “Temporary

Troubled Debt Restructurings,” provides

3 unchanged sentences

On April 7, 2020, the Federal

Reserve and the other banking agencies and regulators issued

a statement, “Interagency Statement on Loan Modifications

and Reporting for Financial Institutions Working

With Customers Affected by

the Coronavirus (Revised)” (the

“Interagency Statement on COVID-19 Loan Modifications”),

to encourage banks to work prudently with borrowers and to

describe the agencies’ interpretation of how accounting rules

under ASC 310-40, “Troubled Debt

Restructurings by

Creditors,” apply to certain COVID-19-related modifications.

The Interagency Statement on COVID-19 Loan

Modifications was supplemented on June 23, 2020 by the Interagency

Examiner Guidance for Assessing Safety and

Soundness Considering the Effect of the COVID-19

Pandemic on Institutions.

If a loan modification is eligible, a bank

may elect to account for the loan under section 4013

of the CARES Act.

If a loan modification is not eligible under section

4013, or if the bank elects not to account for the loan modification

under section 4013, the Revised Statement includes

criteria when a bank may presume a loan modification is not

a TDR in accordance with ASC 310-40.

Reserve and the other banking regulators issued a statement, “Interagency

Statement on Loan Modifications and Reporting

for Financial Institutions Working

With Customers Affected

by the Coronavirus (Revised)” (the “Interagency Statement on

COVID-19 Loan Modifications”), to encourage banks to work prudently

with borrowers and to describe the agencies’

interpretation of how accounting rules under ASC 310

-40, “Troubled Debt Restructurings by Creditors,”

apply to certain

COVID-19-related modifications.

The Interagency Statement

on COVID-19 Loan Modifications was supplemented on

June 23, 2020 by the Interagency Examiner Guidance for Assessing

Safety and Soundness Considering the Effect of the

COVID-19 Pandemic on Institutions.

If a loan modification is eligible, a bank may elect to account for

the loan under

section 4013 of the CARES Act.

If a loan modification is not

eligible under section 4013, or if the bank elects not to

account for the loan modification under section 4013, the Revised Statement

includes criteria when a bank may presume a

loan modification is not a TDR in accordance with ASC 310

The Company evaluates loan extensions or modifications not

42 unchanged sentences

related allowance for loan losses, by portfolio segment and class as of

March 31, 2021 and December 31, 2020,

respectively.

June 30, 2021 and December 31, 2020, respectively.

(Dollars in thousands)

March 31, 2021

June 30, 2021

Commercial real estate:

9 unchanged sentences

Total residential real estate

At March 31, 2021 there were no significant outstanding commitments

to advance additional funds

to customers whose

loans had been restructured.

There were no loans modified in a TDR during the quarters

ended March 31, 2021 and 2020.

During the quarters

ended March 31, 2021 and 2020, respectively,

there were no loans modified in a TDR within the

previous 12 months for which there was a payment default (defined

as 90 days or more past due).

At June 30, 2021 there were no significant outstanding commitments to

advance additional funds to customers whose loans

had been restructured.

Quarter ended June 30,

Six months ended June 30,

(Dollars in thousands)

Total commercial real estate

Residential real estate:

Investment property

Total residential real estate

There were no loans modified in a TDR during the quarter and

six months ended June 30, 2021.

During the quarter and six months ended ended June 30, 2021

and 2020, respectively, there

were no loans modified in a

TDR within the previous 12 months for which there was a payment default

(defined as 90 days or more past due).

MORTGAGE SERVICING

2 unchanged sentences

corresponding mortgage loans are sold.

An estimate of the Company’s MSRs is determined

using assumptions that market

participants would use in

estimating future net servicing income, including estimates of prepayment

speeds, discount rate,

default rates, cost to service, escrow account earnings, contractual

servicing fee income, ancillary income, and late fees.

Subsequent to the date of transfer, the Company

has elected to measure its MSRs under the amortization method.

the amortization method, MSRs are amortized in proportion

to, and over the period of, estimated net servicing income.

The Company has recorded MSRs related to loans sold to

The Company generally sells conforming, fixed-

rate, closed-end, residential mortgages to Fannie Mae.

MSRs are included in other assets on the accompanying

consolidated balance sheets.

An estimate of the fair value of the Company’s

MSRs is determined using

assumptions that market participants would use in estimating

future net servicing income, including estimates of

prepayment speeds, discount rates, default rates, costs to service,

escrow account earnings, contractual servicing fee

income, ancillary income, and late fees.

Subsequent to the date of transfer,

the Company has elected to measure its MSRs

under the amortization method.

Under the amortization method, MSRs are amortized in proportion

to, and over the period

of, estimated net servicing income.

The Company has recorded MSRs related to loans sold without

recourse to Fannie Mae.

The Company generally sells

conforming, fixed-rate, closed-end, residential mortgages to Fannie

MSRs are included in other assets on the

accompanying consolidated balance sheets.

The Company evaluates MSRs for impairment on a quarterly basis.

10 unchanged sentences

lending income.

The change in amortized MSRs and the related valuation allowance

for the quarters ended March 31, 2021 and 2020

presented below.

Quarter ended March 31,

The following table details the changes in amortized MSRs and

the related valuation allowance for the respective periods.

Quarter ended June 30,

Six months ended June 30,

(Dollars in thousands)

41 unchanged sentences

that transfers in and out of any level are expected to be infrequent.

For the quarter ended March 31, 2021, there were no

For the six months ended June 30, 2021, there were no

transfers between levels and no changes in valuation techniques for

the Company’s financial assets and

the Company’s financial

assets and liabilities.

Assets and liabilities measured at fair value

24 unchanged sentences

The following table presents the balances of the assets and liabilities

measured at fair value on a recurring basis as of March

measured at fair value on a recurring basis as of June

30, 2021 and December 31, 2020, respectively,

6 unchanged sentences

(Dollars in thousands)

March 31, 2021:

June 30, 2021:

Securities available-for-sale:

67 unchanged sentences

and late fees.

Periodically, the Company will

Periodically, the Compa

ny will review

broker surveys and other market research to validate significant

9 unchanged sentences

measured at fair value on a nonrecurring basis as of

March 31, 2021 and December 31, 2020, respectively,

by caption, on the accompanying consolidated balance sheets and

June 30, 2021 and December 31, 2020, respectively,

by caption, on the accompanying consolidated balance

sheets and by

FASB ASC 820 valuation

4 unchanged sentences

(Dollars in thousands)

March 31, 2021:

June 30, 2021:

Loans held for sale

6 unchanged sentences

of any related allowance for loan losses.

Represents MSRs, net which are carried at lower of

cost or estimated fair value.

Represents MSRs, net.

These are carried at lower of cost or estimated fair value.

Quantitative Disclosures for Level 3 Fair

Value Measurements

At March 31, 2021,

the Company had no Level 3 assets measured at fair value on a recurring basis.

For Level 3 assets

measured at fair value on a non-recurring basis at March 31,

2021, the significant unobservable inputs used in the fair value

measurements are presented below

At June 30, 2021 and December 31, 2020,

the Company had no Level 3 assets measured at fair value on a recurring

For Level 3 assets measured at fair value on a non-recurring basis

at June 30, 2021 and December 31, 2021,

the significant

unobservable inputs used in the fair value measurements are presented

(Dollars in thousands)

1 unchanged sentence

Unobservable Input

March 31, 2021:

June 30, 2021:

Impaired loans

42 unchanged sentences

price notion.

Loans held for sale

Loans held for

Fair values of loans held for sale are determined using quoted

6 unchanged sentences

fair value hierarchy of the Company’s

instruments at March 31, 2021 and December 31, 2020

instruments at June 30, 2021 and December 31, 2020

are presented below.

15 unchanged sentences

(Dollars in thousands)

March 31, 2021:

June 30, 2021:

Financial Assets:

13 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements