View Filing Data

Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Mar. 31, 2019	May 08, 2019
Document and Entity Information
Entity Registrant Name	FIRST BUSEY CORP /NV/
Entity Central Index Key	0000314489
Document Type	10-Q
Trading Symbol	BUSE
Document Period End Date	Mar. 31, 2019
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		55,624,627
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q1

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Assets
Cash and due from banks	$ 112,775	$ 128,838
Interest-bearing deposits	217,632	111,135
Total cash and cash equivalents	330,407	239,973
Securities available for sale	1,918,295	697,685
Securities held to maturity (fair value 2019 $15,975; 2018 $603,360)	15,846	608,660
Securities equity investments	6,378	6,169
Loans held for sale	20,291	25,895
Portfolio loans (net of allowance for loan losses 2019 $50,915; 2018 $50,648)	6,464,166	5,517,780
Premises and equipment, net	147,958	117,672
Goodwill	314,343	267,685
Other intangible assets, net	63,396	32,873
Cash surrender value of bank owned life insurance	172,934	128,491
Right of use asset	10,898
Other assets	72,422	59,474
Total assets	9,537,334	7,702,357
Deposits:
Noninterest-bearing	1,791,339	1,464,700
Interest-bearing	5,971,887	4,784,621
Total deposits	7,763,226	6,249,321
Securities sold under agreements to repurchase	217,077	185,796
Short-term borrowings	30,739
Long-term debt	89,476	50,000
Senior notes, net of unamortized issuance costs	39,573	39,539
Subordinated notes, net of unamortized issuance costs	59,172	59,147
Junior subordinated debt owed to unconsolidated trusts	71,192	71,155
Lease liability	10,982
Other liabilities	69,756	52,435
Total liabilities	8,351,193	6,707,393
Commitments and contingencies (see Note 10)
Stockholders' Equity
Common stock, $.001 par value, authorized 66,666,667 shares; 55,910,674 shares issued 2019 and 49,185,581 shares issued 2018	56	49
Additional paid-in capital	1,247,340	1,080,084
Accumulated deficit	(57,125)	(72,167)
Accumulated other comprehensive loss	1,595	(6,812)
Total stockholders' equity before treasury stock	1,191,866	1,001,154
Treasury stock, at cost (2019 286,106 shares; 2018 310,745 shares)	(5,725)	(6,190)
Total stockholders’ equity	1,186,141	994,964
Total liabilities and stockholders’ equity	$ 9,537,334	$ 7,702,357
Common shares outstanding at period end	55,624,627	48,874,836

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
CONSOLIDATED BALANCE SHEETS
Held to maturity, fair value	$ 15,975	$ 603,360
Portfolio Loans, allowance for loan losses (in dollars)	$ 50,915	$ 50,648
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	66,666,667	66,666,667
Common stock, shares issued	55,910,674	49,185,581
Common stock shares held in treasury	286,106	310,745

CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands	3 Months Ended
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands	Mar. 31, 2019	Mar. 31, 2018
Interest income:
Interest and fees on loans	$ 71,789	$ 60,960
Interest and dividends on investment securities:
Taxable interest income	10,184	5,990
Non-taxable interest income	1,076	1,260
Other interest income	1,232	423
Total interest income	84,281	68,633
Interest expense:
Deposits	12,500	5,987
Federal funds purchased and securities sold under agreements to repurchase	583	341
Short-term borrowings	191	476
Long-term debt	579	164
Senior notes	400	400
Subordinated notes	731	793
Junior subordinated debt owed to unconsolidated trusts	914	715
Total interest expense	15,898	8,876
Net interest income	68,383	59,757
Provision for loan losses	2,111	1,008
Net interest income after provision for loan losses	66,272	58,749
Non-interest income:
Mortgage revenue	1,945	1,643
Security gains, net	42
Other income	3,052	1,895
Total non-interest income	25,945	22,486
Non-interest expense:
Salaries, wages and employee benefits	32,341	28,819
Net occupancy expense of premises	4,202	3,821
Furniture and equipment expenses	2,095	1,913
Data processing	4,401	4,345
Amortization of intangible assets	2,094	1,515
Other expense	12,030	10,627
Total non-interest expense	57,163	51,040
Income before income taxes	35,054	30,195
Income taxes	9,585	8,278
Net income	$ 25,469	$ 21,917
Basic earnings per common share (in dollars per share)	$ 0.48	$ 0.45
Diluted earnings per common share (in dollars per share)	0.48	0.45
Dividends declared per share of common stock (in dollars per share)	$ 0.21	$ 0.20
Trust fees
Non-interest income:
Non-interest income	$ 8,115	$ 7,514
Commissions and brokers fees, net
Non-interest income:
Non-interest income	914	1,096
Remittance processing
Non-interest income:
Non-interest income	3,780	3,392
Fees for customer services
Non-interest income:
Non-interest income	$ 8,097	$ 6,946

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Net income	$ 25,469	$ 21,917
Unrealized net gains/(losses) on securities:
Unrealized net holding gains (losses) arising during period	6,799	(8,754)
Unrealized gains on investment securities transferred from held to maturity to available for sale	4,780
Reclassification adjustment for gains included in net income	184
Other comprehensive income (loss), before tax	11,763	(8,754)
Income tax expense (benefit) related to items of other comprehensive income	3,356	(2,495)
Other comprehensive income (loss), net of tax	8,407	(6,259)
Comprehensive income	$ 33,876	$ 15,658

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Common Stock	Additional Paid-in Capital	Accumulated (Deficit)	Accumulated Other Comprehensive Income (loss)	Treasury Stock	Total
Beginning Balance at Dec. 31, 2017	$ 49	$ 1,084,889	$ (132,122)	$ (2,810)	$ (15,003)	$ 935,003
Beginning Balance (in shares) at Dec. 31, 2017						48,684,943
Increase (decrease) in shareholders' equity
Net income			21,917			$ 21,917
Other comprehensive loss				(6,259)		(6,259)
Tax Cuts and Jobs Act of 2017 reclassification			605	(605)
Issuance of treasury stock for employee stock purchase plan		(248)			494	$ 246
Issuance of treasury stock for employee stock purchase plan (in shares)						8,718
Net issuance of treasury stock for stock options exercised, net of shares redeemed and related tax		(1,206)			1,336	$ 130
Net issuance of treasury stock for stock options exercised, net of shares redeemed and related tax (in shares)						23,578
Cash dividends common stock at $0.20 and $0.21 per share for the three months ended March 31, 2018 and 2019, respectively			(9,739)			$ (9,739)
Stock dividend equivalents restricted stock units at $0.20 and $0.21 per share for the three months ended March 31, 2018 and 2019, respectively		128	(128)
Stock-based compensation		848				848
Ending Balance at Mar. 31, 2018	49	1,084,411	(119,467)	(9,674)	(13,173)	$ 942,146
Ending Balance (in shares) at Mar. 31, 2018						48,717,239
Beginning Balance at Dec. 31, 2018	49	1,080,084	(72,167)	(6,812)	(6,190)	$ 994,964
Beginning Balance (in shares) at Dec. 31, 2018						48,874,836
Increase (decrease) in shareholders' equity
Net income			25,469			$ 25,469
Other comprehensive loss				8,407		8,407
Stock issued in acquisition of Banc Ed, net of stock issuance costs	7	166,274				$ 166,281
Stock issued in acquisition of Banc Ed, net of stock issuance costs (in shares)						6,725,152
Issuance of treasury stock for employee stock purchase plan		50			222	$ 272
Issuance of treasury stock for employee stock purchase plan (in shares)						11,731
Net issuance of treasury stock for restricted/deferred stock unit vesting and related tax		(171)			171
Net issuance of treasury stock for restricted/deferred stock unit vesting and related tax (in shares)						9,070
Net issuance of treasury stock for stock options exercised, net of shares redeemed and related tax		(72)			72
Net issuance of treasury stock for stock options exercised, net of shares redeemed and related tax (in shares)						3,838
Cash dividends common stock at $0.20 and $0.21 per share for the three months ended March 31, 2018 and 2019, respectively			(10,266)			$ (10,266)
Stock dividend equivalents restricted stock units at $0.20 and $0.21 per share for the three months ended March 31, 2018 and 2019, respectively		161	(161)
Stock-based compensation		1,014				1,014
Ending Balance at Mar. 31, 2019	$ 56	$ 1,247,340	$ (57,125)	$ 1,595	$ (5,725)	$ 1,186,141
Ending Balance (in shares) at Mar. 31, 2019						55,624,627

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) - $ / shares	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
Cash dividends, common stock (in dollars per share)	$ 0.21	$ 0.20
Stock dividends, restricted stock units (in dollars per share)	$ 0.21	$ 0.20

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Cash Flows from Operating Activities
Net income	$ 25,469	$ 21,917
Adjustments to reconcile net income to net cash provided by operating activities:
Stock-based and non-cash compensation	1,014	848
Depreciation	2,671	2,384
Amortization of intangible assets	2,094	1,515
Provision for loan losses	2,111	1,008
Provision for deferred income taxes	1,751	3,172
Amortization of security premiums and discounts, net	1,355	2,324
Accretion of premiums and discounts on time deposits and trust preferred securities, net	(263)	(12)
Accretion of premiums and discounts on portfolio loans, net	(2,694)	(3,398)
Amortization of discount on FHLB advances	(4)
Security loss (gain), net	175
Unrealized losses recorded	(216)
Change in equity securities, net		350
Gain on sales of mortgage loans, net of origination costs	(2,141)	(2,093)
Mortgage loans originated for sale	(83,950)	(97,138)
Proceeds from sales of mortgage loans	93,463	165,045
Net losses on disposition of premises and equipment	24	52
Decrease in deferred compensation	(3,339)
Increase in cash surrender value of bank owned life insurance	(884)	(726)
Change in assets and liabilities:
(Increase) decrease in other assets	(3,121)	2,845
(Decrease) in other liabilities	(3,427)	(10,401)
Increase in interest payable	357	1,550
Increase in income taxes receivable	5,824	4,421
Net cash provided by operating activities	36,269	93,663
Cash Flows from Investing Activities
Proceeds from sales of securities classified available for sale	141,798
Proceeds from sales of securities classified equity	958
Proceeds from maturities of securities classified available for sale	43,435	43,066
Proceeds from maturities of securities classified held to maturity	13,822	8,012
Purchase of securities classified available for sale	(125,464)	(2,164)
Purchase of securities classified held to maturity		(24,868)
Net increase in loans	(72,655)	(10,844)
Proceeds from sale of OREO properties	147	639
Purchases of premises and equipment	(1,052)	(4,508)
Proceeds from the redemption of FHLB stock, net		4,864
Net cash paid in acquisitions	(49,387)
Net cash (used in) provided by investing activities	(48,398)	14,197
Cash Flows from Financing Activities
Net increase (decrease) in certificates of deposit	(25,958)	72,764
Net (decrease) increase in demand deposits, money market and savings accounts	100,960	132,493
Net (decrease) increase in federal funds purchased and securities sold under agreements to repurchase	(19,318)	(69,255)
Repayment of FHLB advances, net	(1,121)
Repayment of short-term borrowings		(220,000)
Net proceeds from long-term debt	60,000
Cash dividends paid	(10,266)	(9,739)
Repayments of long-term debt	(1,500)
Proceeds from stock options exercised		130
Common stock issuance costs	(234)
Net cash (used in) provided by financing activities	102,563	(93,607)
Net increase in cash and cash equivalents	90,434	14,253
Cash and cash equivalents, beginning of period	239,973	353,272
Cash and cash equivalents, ending of period	330,407	367,525
Cash payments for:
Interest	14,876	7,325
Income taxes	690
Non-cash Investing and Financing Activities:
Other real estate acquired in settlement of loans	577	$ 348
Transfer of investment securities held to maturity to available for sale	$ 573,639

Significant Accounting Policies

3 Months Ended

Mar. 31, 2019

Significant Accounting Policies

Significant Accounting Policies

Note 1: Significant Accounting Policies

Basis of Financial Statement Presentation

When preparing these unaudited consolidated financial statements of First Busey Corporation and its subsidiaries (“First Busey,” “Company,” “we,” or “our”), a Nevada corporation, we have assumed that you have read the audited consolidated financial statements included in our 2018 Form 10-K. These interim unaudited consolidated financial statements serve to update our 2018 Form 10-K and may not include all information and notes necessary to constitute a complete set of financial statements.

We prepared these unaudited consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”). We have eliminated intercompany accounts and transactions. We have also reclassified certain prior year amounts to conform to the current period presentation. These reclassifications did not have a material impact on our consolidated financial condition or results of operations.

In our opinion, the unaudited consolidated financial statements reflect all normal, recurring adjustments needed to present fairly our results for the interim periods. The results of operations for interim periods are not necessarily indicative of the results that may be expected for the full year or any other interim period.

The Company has evaluated subsequent events for potential recognition and/or disclosure through the date the unaudited consolidated financial statements included in this Quarterly Report on Form 10-Q were issued. There were no significant subsequent events for the quarter ended March 31, 2019 through the issuance date of these unaudited consolidated financial statements that warranted adjustment to or disclosure in the unaudited consolidated financial statements.

Use of Estimates

In preparing the accompanying unaudited consolidated financial statements in conformity with GAAP, the Company’s management is required to make estimates and assumptions that affect the amounts reported in the financial statements and the disclosures provided. Actual results could differ from those estimates. Material estimates which are particularly susceptible to significant change in the near term relate to the fair value of investment securities, fair value of assets acquired and liabilities assumed in business combinations, goodwill, and the determination of the allowance for loan losses.

Leases

A determination is made at inception if an arrangement contains a lease. For arrangements that contain a lease, the Company recognizes the lease on the balance sheet as a right of use asset and corresponding lease liability. Lease-related assets, or right of use assets, are recognized on the lease commencement date at amounts equal to the respective lease liabilities, adjusted for prepaid lease payments, initial direct costs, and lease incentives received. Lease-related liabilities are recognized at the present value of the remaining contractual fixed lease payments, discounted using our incremental borrowing rate. Operating lease expense is recognized on a straight-line basis over the lease term, while variable lease payments are expensed as incurred.

Topic 842 requires the use of the rate implicit in the lease whenever this rate is readily determinable. If not readily determinable, the Company utilizes its incremental borrowing rate at lease inception, on a collateralized basis, over a similar term. For operating leases existing prior to January 1, 2019, the Company used a borrowing rate that corresponded to the remaining lease term.

The Company’s lease agreements often include one or more options to renew at the Company’s discretion. If at lease inception, the Company considers the exercising of a renewal option to be reasonably certain, the Company will include the extended term in the calculation of the right-of-use asset and lease liability.

Impact of recently adopted accounting standards

Accounting Standards Update (“ASU”) 2016-02, "Leases (Topic 842)." ASU 2016-02 intends to increase transparency and comparability among organizations by recognizing all lease transactions (with original terms in excess of 12 months) on the Consolidated Balance Sheet as a lease liability and a right-of-use asset. The guidance also requires qualitative and quantitative disclosures of the amount, timing and uncertainty of cash flows arising from leases. In July 2018, ASU 2018-11, "Leases (Topic 842): Targeted Improvements" was issued to allow companies to choose to recognize the cumulative effect of applying the new standard to leased assets and liabilities as an adjustment to the opening balance of retained earnings rather than recasting prior year results upon adoption of the standard.

ASU 2019-01, "Leases (Topic 842): Codification Improvements." In 2016, The FASB issued ASU 2016- 02, “Leases (Topic 842)”, to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing essential information about leasing transactions. ASU 2019-01 clarifies the guidance in ASU 2016-02 and/or corrects unintended application of the guidance. For public business entities, this guidance is effective for annual reporting periods beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted and the Company adopted this guidance during the first quarter of 2019. The adoption of this guidance did not have a material impact on the Company’s consolidated financial statements.

On January 1, 2019, the Company adopted ASU No. 2016-02 “Leases (Topic 842) and all subsequent ASUs that modified Topic 842. The Company made the following elections for all leases in connection with the adoption of this guidance:

The Company elected the package of practical expedients to not reassess prior conclusions related to contracts containing leases, lease classification and initial direct costs;

The Company did not elect the hindsight practical expedient;

The Company elected the optional transition method that allows companies to use the effective date as the date of initial application on transition. As a result, the Company did not adjust comparative period financial information or make the newly required lease disclosures for periods before the effective date;

The Company elected not to apply the above guidance to short-term leases;

The Company elected to separate the lease components from the nonlease components and exclude the nonlease components from the right-of-use asset and lease liability; and

The Company did not elect the land easement practical expedient.

At the date of adoption, the Company recorded approximately $11.6 million on its Consolidated Balance Sheets to reflect the right of use asset and associated lease liability. The Company utilized its incremental borrowing rate, on a collateralized basis, for the remaining contractual lease term.

ASU 2017-08, "Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20), Premium Amortization on Purchased Callable Debt Securities." ASU 2017-08 shortens the amortization period for certain callable debt securities held at a premium, requiring the premium to be amortized to the earliest call date. ASU 2017-08 does not require an accounting change for securities held at a discount; the discount continues to be amortized to maturity. This guidance was effective for annual reporting periods beginning after December 15, 2018, including interim periods within those fiscal years. The adoption of this guidance did not have a material impact on the Company’s consolidated financial statements.

ASU 2017-12, "Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities." ASU 2017-12 amends Topic 815 to reduce the cost and complexity of applying hedge accounting and expands the types of relationships that qualify for hedge accounting. The guidance eliminates the requirement to separately measure and report hedge ineffectiveness, requires all items that affect earnings to be presented in the same income statement line as the hedged item, provides for applying hedge accounting to additional hedging strategies, provides for new approaches to measuring the hedged item in fair value hedges of interest rate risk, and eases the requirements for effective testing and hedge documentation. This guidance was effective for annual reporting periods beginning after December 15, 2018, including interim periods within those fiscal years. During the first quarter of 2019, when the Company adopted this guidance and reassessed classification of certain investments and transferred $573.6 million of securities from held to maturity to available for sale.

ASU 2018-07, "Compensation-Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting." ASU 2018-07 expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. This guidance was effective for annual reporting periods beginning after December 15, 2018, including interim periods within those fiscal years. The adoption of this guidance did not have a material impact on the Company’s consolidated financial statements.

ASU 2016-13, "Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments." ASU 2016-13 implements a change from the current impaired loss model to an expected credit loss model over the life of an instrument, including loans and securities held to maturity. The expected credit loss model is expected to result in earlier recognition of losses. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019 including interim periods with those years. The Company has developed and is executing a project plan to implement this guidance. The project plan includes an assessment of data, development of CECL methodologies, model validation, and parallel runs to assess the impact of CECL calculations on its consolidated financial statements and evaluation of related disclosures.

Acquisition

3 Months Ended

Mar. 31, 2019

Acquisition

Acquisition

Note 2: Acquisition

The Banc Ed Corp.

On January 31, 2019, the Company completed its acquisition of The Banc Ed Corp. (“Banc Ed”). TheBANK of Edwardsville (“TheBANK”), Banc Ed’s wholly-owned bank subsidiary, will be merged with and into First Busey’s bank subsidiary, Busey Bank, which is expected to occur in the fourth quarter of 2019. At the time of the bank merger, TheBANK’s banking offices will become branches of Busey Bank.

Under the terms of the Merger Agreement with Banc Ed, at the effective time of the acquisition, each share of Banc Ed common stock issued and outstanding was converted into the right to receive 8.2067 shares of the Company’s common stock, cash in lieu of fractional shares and $111.53 cash consideration per share. The market value of the 6.7 million shares of First Busey common stock issued at the effective time of the acquisition was approximately $166.5 million based on First Busey’s closing stock price of $24.76 on January 31, 2019.

This transaction was accounted for using the acquisition method of accounting and, accordingly, assets acquired, liabilities assumed, and consideration exchanged was recorded at estimated fair values on the date of acquisition. Fair values are considered provisional until final fair values are determined or the measurement period has passed, but no later than one year from the acquisition date. Reviews of third party valuations are still being performed by management. Therefore amounts are subject to change and could change materially from the provisional amounts disclosed below.

First Busey incurred $1.0 million in pre-tax expenses related to the acquisition of Banc Ed for the three months ended March 31, 2019, primarily for professional and legal fees, all of which are reported as a component of non-interest expense in the accompanying unaudited Consolidated Statement of Income.

The following table presents the estimated fair value of Banc Ed’s assets acquired and liabilities assumed as of January 31, 2019 (dollars in thousands):


	Estimated by
	First Busey
Assets acquired:
Cash and cash equivalents	$	42,013
Securities		692,684
Loans held for sale		2,157
Portfolio loans		873,336
Premises and equipment		31,929
Other intangible assets		32,617
Mortgage servicing rights		6,946
Other assets		57,296
Total assets acquired		1,738,978

Liabilities assumed:
Deposits		1,439,203
Other borrowings		63,439
Other liabilities		25,079
Total liabilities assumed		1,527,721

Net assets acquired	$	211,257

Consideration paid:
Cash	$	91,400
Common stock		166,515
Total consideration paid	$	257,915

Goodwill	$	46,658

The loans acquired in this transaction were recorded at fair value with no carryover of any existing allowance for loan losses. Loans that were not deemed to be credit-impaired at the acquisition date were accounted for under FASB ASC 310-20, Receivables-Nonrefundable Fees and Other Costs, and were subsequently considered as part of the Company’s determination of the adequacy of the allowance for loan losses. Purchased credit impaired (“PCI”) loans were accounted for under ASC 310-30, Receivables — Loans and Debt Securities Acquired with Deteriorated Credit Quality. As of the acquisition date, the aggregate principal balance outstanding and aggregate fair value of the acquired performing loans, including loans held for sale, were $889.3 and $871.0 million, respectively. The difference between the carrying value and aggregate fair value of $17.0 million will be accreted over the estimated remaining life of the respective loans in a manner that approximates the level yield method. As of the acquisition date, the aggregate principal balance outstanding of PCI loans totaled $3.9 million and the aggregate fair value of PCI loans totaled $2.3 million. The accretable discount of $0.2 million on PCI loans represents the amount by which the undiscounted expected cash flows on such loans exceed their carrying value. The amount by which the contractual payments exceeds the undiscounted expected cash flows represents the non-accretable difference. The difference between contractually required payments at the acquisition date and the cash flow expected to be collected is referred to as the non-accretable difference. Further, the excess of cash flows expected at acquisition over the fair value is referred to as the accretable yield. At March 31, 2019, the carrying value of PCI loans acquired from Banc Ed was $2.3 million.

Since the acquisition date, Banc Ed earned total revenues of $12.3 million and net income of $3.6 million, which are included in the Company’s Consolidated Statements of Income for the three months ended March 31, 2019. The following table provides the unaudited pro forma information for the results of operations for the three months ended March 31, 2019 and 2018, as if the acquisition had occurred January 1, 2018. The pro forma results combine the historical results of Banc Ed into the Company’s Consolidated Statements of Income, including the impact of purchase accounting adjustments including loan discount accretion, intangible assets amortization, deposit accretion and premises accretion, net of taxes. The pro forma results have been prepared for comparative purposes only and are not necessarily indicative of the results that would have been obtained had the acquisition actually occurred on January 1, 2018. No assumptions have been applied to the pro forma results of operations regarding possible revenue enhancements, expense efficiencies or asset dispositions. Only the merger related expenses that have been recognized are included in net income in the table below (dollars in thousands):


	Pro Forma
	Three Months Ended March 31,
	2019		2018
Total revenues (net interest income plus non-interest income)	$	100,652	$	101,119
Net income		27,390		25,813
Diluted earnings per common share		0.49		0.47

Securities

3 Months Ended

Mar. 31, 2019

Securities

Securities

Note 3: Securities

The table below provides the amortized cost, unrealized gains and losses and fair values of securities summarized by major category (dollars in thousands):


			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
March 31, 2019:	Cost		Gains		Losses		Value
Available for sale
U.S. Treasury securities	$	64,506	$	76	$	(273)	$	64,309
Obligations of U.S. government corporations and agencies		323,686		2,122		(388)		325,420
Obligations of states and political subdivisions		281,473		2,357		(352)		283,478
Commercial mortgage-backed securities		55,926		29		(393)		55,562
Residential mortgage-backed securities		1,051,556		4,512		(6,307)		1,049,761
Corporate debt securities		138,913		933		(81)		139,765
Total	$	1,916,060	$	10,029	$	(7,794)	$	1,918,295

Held to maturity
Obligations of states and political subdivisions	$	15,846	$	132	$	(3)	$	15,975


			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
December 31, 2018:	Cost		Gains		Losses		Value
Available for sale
U.S. Treasury securities	$	25,824	$	1	$	(414)	$	25,411
Obligations of U.S. government corporations and agencies		53,096		7		(761)		52,342
Obligations of states and political subdivisions		171,131		484		(1,571)		170,044
Commercial mortgage-backed securities		2,003		—		(61)		1,942
Residential mortgage-backed securities		322,646		245		(7,143)		315,748
Corporate debt securities		132,513		61		(376)		132,198
Total	$	707,213	$	798	$	(10,326)	$	697,685

Held to maturity
Obligations of states and political subdivisions	$	33,947	$	68	$	(87)	$	33,928
Commercial mortgage-backed securities		59,054		11		(1,003)		58,062
Residential mortgage-backed securities		515,659		1,748		(6,037)		511,370
Total	$	608,660	$	1,827	$	(7,127)	$	603,360

In adopting ASU 2017-12, the Company reassessed classification of certain investments during the first quarter of 2019 and transferred $573.6 million of securities from held to maturity to available for sale. The transfer occurred at fair value and had a related unrealized loss of $4.8 million recorded in other comprehensive income.

The amortized cost and fair value of debt securities, by contractual maturity or pre-refunded date, are shown below. Mortgages underlying mortgage-backed securities may be called or prepaid; therefore, actual maturities could differ from the contractual maturities. All mortgage-backed securities were issued by U.S. government agencies and corporations (dollars in thousands).


	Available for sale				Held to maturity
	Amortized		Fair		Amortized		Fair
March 31, 2019:	Cost		Value		Cost		Value
Due in one year or less	$	166,786	$	166,734	$	1,914	$	1,913
Due after one year through five years		517,731		519,968		12,807		12,909
Due after five years through ten years		276,057		277,308		1,125		1,153
Due after ten years		955,486		954,285		—		—
Total	$	1,916,060	$	1,918,295	$	15,846	$	15,975

Realized gains and losses related to sales and calls of securities available for sale are summarized as follows (dollars in thousands):


	Three Months Ended March 31,
	2019		2018
Gross security gains	$	184	$	—
Gross security (losses)		—		—
Security gains (losses), net(1)	$	184	$	—

(1)

Security gains (losses), net reported on the Consolidated Statements of Income in 2019 includes gains of equity securities, excluded in this table.

Investment securities with carrying amounts of $564.0 million and $498.3 million on March 31, 2019 and December 31, 2018, respectively, were pledged as collateral for public deposits, securities sold under agreements to repurchase and for other purposes as required or permitted by law.

Information pertaining to securities with gross unrealized losses aggregated by investment category and length of time that individual securities have been in a continuous loss position, follows (dollars in thousands):



	For less than				For greater
	12 months, gross				than 12 months, gross				Total, gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
March 31, 2019:	Value		Losses		Value		Losses		Value		Losses
Available for sale
U.S. Treasury securities	$	7,484	$	(2)	$	24,505	$	(271)	$	31,989	$	(273)
Obligations of U.S. government corporations and agencies		750		(2)		50,966		(386)		51,716		(388)
Obligations of states and political subdivisions		11,453		(28)		63,959		(324)		75,412		(352)
Commercial mortgage-backed securities		—		—		430		(393)		430		(393)
Residential mortgage-backed securities		16,083		(9)		551,248		(6,298)		567,331		(6,307)
Corporate debt securities		7,561		(16)		20,369		(65)		27,930		(81)
Total temporarily impaired securities	$	43,331	$	(57)	$	711,477	$	(7,737)	$	754,808	$	(7,794)

Held to maturity
Obligations of states and political subdivisions	$	—	$	—	$	2,301	$	(3)	$	2,301	$	(3)



	For less than				For greater
	12 months, gross				than 12 months, gross				Total, gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
December 31, 2018:	Value		Losses		Value		Losses		Value		Losses
Available for sale
U.S. Treasury securities	$	995	$	(4)	$	24,343	$	(410)	$	25,338	$	(414)
Obligations of U.S. government corporations and agencies		749		(3)		50,744		(758)		51,493		(761)
Obligations of states and political subdivisions		49,893		(460)		77,651		(1,111)		127,544		(1,571)
Commercial mortgage-backed securities		—		—		1,942		(61)		1,942		(61)
Residential mortgage-backed securities		48,387		(496)		247,573		(6,647)		295,960		(7,143)
Corporate debt securities		90,713		(268)		15,083		(108)		105,796		(376)
Total temporarily impaired securities	$	190,737	$	(1,231)	$	417,336	$	(9,095)	$	608,073	$	(10,326)

Held to maturity
Obligations of states and political subdivisions	$	9,531	$	(33)	$	9,538	$	(54)	$	19,069	$	(87)
Commercial mortgage-backed securities		12,067		(212)		45,041		(791)		57,108		(1,003)
Residential mortgage-backed securities		77,071		(974)		245,128		(5,063)		322,199		(6,037)
Total temporarily impaired securities	$	98,669	$	(1,219)	$	299,707	$	(5,908)	$	398,376	$	(7,127)

Securities are periodically evaluated for other-than-temporary impairment (“OTTI”). As of March 31, 2019, the Company’s security portfolio consisted of 1,354 securities. The total number of securities in the investment portfolio in an unrealized loss position as of March 31, 2019 was 366 and represented an unrealized loss of 1.02% of the aggregate amortized cost. The unrealized losses relate to changes in market interest rates and market conditions that do not represent credit-related impairments. Furthermore, the Company does not intend to sell such securities and it is more likely than not that the Company will recover the amortized cost prior to being required to sell the securities. Full collection of the amounts due according to the contractual terms of the securities is expected; therefore, the Company does not consider these investments to be OTTI at March 31, 2019. As of March 31, 2019, the Company did not hold general obligation bonds of any single issuer, the aggregate of which exceeded 10% of the Company’s stockholders’ equity.

Portfolio loans

3 Months Ended

Mar. 31, 2019

Portfolio loans

Portfolio loans

Note 4: Portfolio loans

The distribution of portfolio loans is as follows (dollars in thousands):


	March 31,		December 31,
	2019		2018
Commercial	$	1,657,022	$	1,405,106
Commercial real estate		2,699,491		2,366,823
Real estate construction		387,623		288,197
Retail real estate		1,718,415		1,480,133
Retail other		52,530		28,169
Portfolio loans	$	6,515,081	$	5,568,428

Allowance for loan losses		(50,915)		(50,648)
Portfolio loans, net	$	6,464,166	$	5,517,780

Net deferred loan origination costs included in the table above were $5.4 million as of March 31, 2019 and $5.6 million as of December 31, 2018. Net accretable purchase accounting adjustments included in the table above reduced loans by $28.2 million as of March 31, 2019 and $13.9 million as of December 31, 2018.

The Company utilizes a loan grading scale to assign a risk grade to all of its loans. A description of the general characteristics of each grade is as follows:

Pass- This category includes loans that are all considered strong credits, ranging from investment or near investment grade, to loans made to borrowers who exhibit credit fundamentals that exceed industry standards and loan policy guidelines and loans that exhibit acceptable credit fundamentals.

Watch- This category includes loans on management’s “Watch List” and is intended to be utilized on a temporary basis for a pass grade borrower where a significant risk-modifying action is anticipated in the near future.

Special mention- This category is for “Other Assets Specially Mentioned” loans that have potential weaknesses, which may, if not checked or corrected, weaken the asset or inadequately protect the Company’s credit position at some future date.

Substandard- This category includes “Substandard” loans, determined in accordance with regulatory guidelines, for which the accrual of interest has not been stopped. Assets so classified must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Company will sustain some loss if the deficiencies are not corrected.

Substandard Non-accrual- This category includes loans that have all the characteristics of a “Substandard” loan with additional factors that make collection in full highly questionable and improbable. Such loans are placed on non-accrual status and may be dependent on collateral with a value that is difficult to determine.

All loans are graded at their inception. Most commercial lending relationships that are $1.0 million or less are processed through an expedited underwriting process. If the credit receives a pass grade, it is aggregated into a homogenous pool of either: $0.35 million or less, or $0.35 million to $1.0 million. These pools are monitored on a regular basis and reviewed annually. Most commercial loans greater than $1.0 million are included in a portfolio review at least annually. Commercial loans greater than $0.35 million that have a grading of special mention or worse are reviewed on a quarterly basis. Interim reviews may take place if circumstances of the borrower warrant a more timely review.

The following table is a summary of risk grades segregated by category of portfolio loans (excluding accretable purchase accounting adjustments and clearings) (dollars in thousands):


	March 31, 2019
					Special				Substandard
	Pass		Watch		Mention		Substandard		Non-accrual
Commercial	$	1,359,640	$	180,954	$	59,595	$	41,525	$	16,243
Commercial real estate		2,406,213		168,415		89,262		33,585		9,761
Real estate construction		362,541		19,652		3,105		1,346		1,126
Retail real estate		1,671,219		14,202		6,802		7,678		9,080
Retail other		51,101		90		—		16		20
Total	$	5,850,714	$	383,313	$	158,764	$	84,150	$	36,230


	December 31, 2018
					Special				Substandard
	Pass		Watch		Mention		Substandard		Non-accrual
Commercial	$	1,126,257	$	172,449	$	47,000	$	42,532	$	17,953
Commercial real estate		2,106,711		137,214		85,148		36,205		10,298
Real estate construction		268,069		14,562		3,899		1,888		18
Retail real estate		1,448,964		6,425		6,792		5,435		6,698
Retail other		26,707		—		—		—		30
Total	$	4,976,708	$	330,650	$	142,839	$	86,060	$	34,997

An analysis of portfolio loans that are past due and still accruing or on a non-accrual status is as follows (dollars in thousands):


	March 31, 2019
	Loans past due, still accruing						Non-accrual
	30-59 Days		60-89 Days		90+Days		Loans
Commercial	$	410	$	1,500	$	72	$	16,243
Commercial real estate		1,662		595		—		9,761
Real estate construction		191		—		—		1,126
Retail real estate		4,442		1,596		284		9,080
Retail other		364		20		—		20
Total	$	7,069	$	3,711	$	356	$	36,230


	December 31, 2018
	Loans past due, still accruing						Non-accrual
	30-59 Days		60-89 Days		90+Days		Loans
Commercial	$	158	$	140	$	775	$	17,953
Commercial real estate		148		558		—		10,298
Real estate construction		121		—		58		18
Retail real estate		4,578		1,368		766		6,698
Retail other		48		2		2		30
Total	$	5,053	$	2,068	$	1,601	$	34,997

The gross interest income that would have been recorded in the three months ended March 31, 2019 and 2018 if impaired loans had been current in accordance with their original terms was $0.7 million and $0.4 million, respectively. The amount of interest collected on those loans and recognized on a cash basis that was included in interest income was insignificant for the three months ended March 31, 2019 and 2018.

A summary of restructured loans is as follows (dollars in thousands):


	March 31,		December 31,
	2019		2018
In compliance with modified terms	$	11,127	$	8,319
30 — 89 days past due		184		127
Included in non-performing loans		360		392
Total	$	11,671	$	8,838

There was $3.1 million of loans newly classified as troubled debt restructurings (“TDR”) during the three months ended March 31, 2019, which included one commercial loan for payment modification. There were no loans newly classified as TDRs during the three months ended March 31, 2018.

The gross interest income that would have been recorded in the three months ended March 31, 2019 and 2018 if TDRs had performed in accordance with their original terms compared with their modified terms was insignificant.

There were no TDRs that were entered into during the last twelve months that were subsequently classified as non-performing and had payment defaults (a default occurs when a loan is 90 days or more past due or transferred to non-accrual) during the three months ended March 31, 2019. There were no TDRs that were entered into during the prior twelve months that were subsequently classified as non-performing and had payment defaults during the three months ended March 31, 2018.

At March 31, 2019, the Company had $3.4 million of residential real estate in the process of foreclosure.

The following tables provide details of loans identified as impaired, segregated by category. The unpaid contractual principal balance represents the recorded balance prior to any partial charge-offs. The recorded investment represents customer balances net of any partial charge-offs recognized on the loan. The average recorded investment is calculated using the most recent four quarters (dollars in thousands).


	March 31, 2019
	Unpaid		Recorded
	Contractual		Investment		Recorded		Total				Average
	Principal		with No		Investment		Recorded		Related		Recorded
	Balance		Allowance		with Allowance		Investment		Allowance		Investment
Commercial	$	19,507	$	5,605	$	10,787	$	16,392	$	4,126	$	15,165
Commercial real estate		20,174		13,818		4,498		18,316		1,231		18,448
Real estate construction		930		820		—		820		—		586
Retail real estate		16,795		14,815		115		14,930		42		13,792
Retail other		48		20		—		20		—		40
Total	$	57,454	$	35,078	$	15,400	$	50,478	$	5,399	$	48,031


	December 31, 2018
	Unpaid		Recorded
	Contractual		Investment		Recorded		Total				Average
	Principal		with No		Investment		Recorded		Related		Recorded
	Balance		Allowance		with Allowance		Investment		Allowance		Investment
Commercial	$	21,442	$	6,858	$	12,001	$	18,859	$	4,319	$	13,364
Commercial real estate		19,079		13,082		4,498		17,580		1,181		18,077
Real estate construction		478		453		—		453		—		712
Retail real estate		14,418		13,196		61		13,257		61		14,110
Retail other		117		33		—		33		—		40
Total	$	55,534	$	33,622	$	16,560	$	50,182	$	5,561	$	46,303

Management's evaluation as to the ultimate collectability of loans includes estimates regarding future cash flows from operations and the value of property, real and personal, pledged as collateral. These estimates are affected by changing economic conditions and the economic prospects of borrowers.

The Company holds acquired loans from business combinations with uncollected principal balances. These loans are carried net of a fair value adjustment for credit risk and interest rates and are only included in the allowance calculation to the extent that the reserve requirement exceeds the fair value adjustment. As the acquired loans renew, it is generally necessary to establish an allowance, which represents an amount that, in management’s opinion, will be adequate to absorb probable credit losses in such loans. The recorded investment of all acquired loans as of March 31, 2019 totaled approximately $2.0 billion.

The following table details activity in the allowance for loan losses. Allocation of a portion of the allowance to one category does not preclude its availability to absorb losses in other categories (dollars in thousands):


	As of and for the Three Months Ended March 31, 2019
			Commercial		Real Estate		Retail Real
	Commercial		Real Estate		Construction		Estate		Retail Other		Total
Beginning balance	$	17,829	$	21,137	$	2,723	$	8,471	$	488	$	50,648
Provision for loan losses		1,793		(1,089)		2		1,357		48		2,111
Charged-off		(1,807)		(15)		—		(517)		(130)		(2,469)
Recoveries		183		64		82		192		104		625
Ending balance	$	17,998	$	20,097	$	2,807	$	9,503	$	510	$	50,915


	As of and for the Three Months Ended March 31, 2018
			Commercial		Real Estate		Retail Real
	Commercial		Real Estate		Construction		Estate		Retail Other		Total
Beginning balance	$	14,779	$	21,813	$	2,861	$	13,783	$	346	$	53,582
Provision for loan losses		3,003		1,536		2		(3,662)		129		1,008
Charged-off		(781)		(1,315)		(97)		(530)		(207)		(2,930)
Recoveries		576		56		33		245		79		989
Ending balance	$	17,577	$	22,090	$	2,799	$	9,836	$	347	$	52,649

The following table presents the allowance for loan losses and recorded investments in portfolio loans by category (dollars in thousands):


	As of March 31, 2019
			Commercial		Real Estate		Retail Real
	Commercial		Real Estate		Construction		Estate		Retail Other		Total
Allowance for loan losses
Ending balance attributed to:
Loans individually evaluated for impairment	$	4,126	$	1,231	$	—	$	42	$	—	$	5,399
Loans collectively evaluated for impairment		13,872		18,866		2,807		9,461		510		45,516
Ending balance	$	17,998	$	20,097	$	2,807	$	9,503	$	510	$	50,915

Loans:
Loans individually evaluated for impairment	$	16,361	$	15,733	$	385	$	13,296	$	20	$	45,795
Loans collectively evaluated for impairment		1,640,630		2,679,200		387,238		1,705,025		52,510		6,464,603
PCI loans evaluated for impairment		31		4,558		—		94		—		4,683
Ending balance	$	1,657,022	$	2,699,491	$	387,623	$	1,718,415	$	52,530	$	6,515,081


	As of December 31, 2018
			Commercial		Real Estate		Retail Real
	Commercial		Real Estate		Construction		Estate		Retail Other		Total
Allowance for loan losses
Ending balance attributed to:
Loans individually evaluated for impairment	$	4,319	$	1,181	$	—	$	61	$	—	$	5,561
Loans collectively evaluated for impairment		13,510		19,956		2,723		8,410		488		45,087
Ending balance	$	17,829	$	21,137	$	2,723	$	8,471	$	488	$	50,648

Loans:
Loans individually evaluated for impairment	$	18,441	$	15,318	$	453	$	13,159	$	33	$	47,404
Loans collectively evaluated for impairment		1,386,247		2,349,243		287,744		1,466,876		28,136		5,518,246
PCI loans evaluated for impairment		418		2,262		—		98		—		2,778
Ending balance	$	1,405,106	$	2,366,823	$	288,197	$	1,480,133	$	28,169	$	5,568,428

Deposits

3 Months Ended

Mar. 31, 2019

Deposits

Deposits

Note 5: Deposits

The composition of deposits is as follows (dollars in thousands):


	March 31, 2019		December 31, 2018
Demand deposits, noninterest-bearing	$	1,791,339	$	1,464,700
Interest-bearing transaction deposits		1,812,146		1,435,574
Saving deposits and money market deposits		2,402,663		1,852,044
Time deposits		1,757,078		1,497,003
Total	$	7,763,226	$	6,249,321

The Company held brokered saving deposits and money market deposits of $20.0 million and $17.5 million at March 31, 2019 and December 31, 2018, respectively.

The aggregate amount of time deposits with a minimum denomination of $100,000 was approximately $886.2 million and $673.7 million at March 31, 2019 and December 31, 2018, respectively. The aggregate amount of time deposits with a minimum denomination that meets or exceeds the Federal Deposit Insurance Corporation (“FDIC”) insurance limit of $250,000 was approximately $348.5 million and $264.1 million at March 31, 2019 and December 31, 2018, respectively. The Company held brokered time deposits of $121.9 million and $262.5 million at March 31, 2019 and December 31, 2018, respectively.

As of March 31, 2019, the scheduled maturities of time deposits are as follows (dollars in thousands):


April 1, 2019 – March 31, 2020	$	1,094,836
April 1, 2020 – March 31, 2021		361,266
April 1, 2021 – March 31, 2022		140,316
April 1, 2022 – March 31, 2023		86,067
April 1, 2023 – March 31, 2024		73,720
Thereafter		873
	$	1,757,078

Borrowings

3 Months Ended

Mar. 31, 2019

Borrowings

Borrowings

Note 6: Borrowings

Securities sold under agreements to repurchase, which are classified as secured borrowings, generally mature daily. Securities sold under agreements to repurchase are reflected at the amount of cash received in connection with the transaction. The underlying securities are held by the Company’s safekeeping agent. The Company may be required to provide additional collateral based on fluctuations in the fair value of the underlying securities.

Short-term borrowings include FHLB advances which mature in less than one year from date of origination.

On January 29, 2019, the Company entered into an Amended and Restated Credit Agreement to allow any outstanding balance on the $20.0 million revolving facility at the maturity date of April 30, 2019 to be converted into a term loan with a maturity date of April 30, 2021. The revolving facility incurs a non-usage fee based on the undrawn amount. The Amended and Restated Credit Agreement also provided for a $60.0 million term loan (the “Term Loan”) with a maturity date of November 30, 2023. The loan has an annual interest rate of one-month LIBOR plus a spread of 1.50%. The proceeds of the Term Loan were used to fund the cash consideration related to the acquisition of Banc Ed. The Company had $58.5 million outstanding on March 31, 2019, $6.0 million of short-term and $52.5 million of long-term.

On April 19, 2019, the company entered into an amendment to the Amended and Restated Credit Agreement to extend the maturity of its revolving loan facility from April 30, 2019 to April 30, 2020.

Long-term debt is summarized as follows (dollars in thousands):


	March 31,		December 31,
	2019		2018
Notes payable, FHLB, ranging in original maturity from nineteen months to ten years, collateralized by FHLB deposits, residential and commercial real estate loans and FHLB stock.	$	36,976	$	50,000
Notes payable		52,500		—
Total long-term borrowings	$	89,476	$	50,000

As of March 31, 2019, funds borrowed from the FHLB, consisted of variable-rate notes maturing through September 2024, with interest rates ranging from 1.64% to 3.04%. The weighted average rate on the long-term advances was 2.36% as of March 31, 2019. As of December 31, 2018, funds borrowed from the FHLB, listed above, consisted of variable-rate notes maturing through September 2024, with interest rates ranging from 2.20% to 2.41%. The weighted average rate on the long-term advances was 2.28% as of December 31, 2018.

On May 25, 2017, the Company issued $40.0 million of 3.75% senior notes that mature on May 25, 2022. The senior notes are payable semi-annually on each May 25 and November 25, commencing on November 25, 2017. Additionally, on May 25, 2017, the Company issued $60.0 million of fixed-to-floating rate subordinated notes that mature on May 25, 2027. The subordinated notes, which qualify as Tier 2 capital for First Busey, are at an initial rate of 4.75% for five years and thereafter at an annual floating rate equal to three-month LIBOR plus a spread of 2.919%. The subordinated notes are payable semi-annually on each May 25 and November 25, commencing on November 25, 2017 during the five year fixed-term and thereafter each February 25, May 25, August 25 and November 25 of each year, commencing on August 25, 2022. The subordinated notes have an optional redemption in whole or in part on any interest payment date on or after May 25, 2022. The senior notes and subordinated notes are unsecured obligations of the Company. Unamortized debt issuance costs related to the senior notes and subordinated notes totaled $0.4 million and $0.8 million, respectively, at March 31, 2019. Unamortized debt issuance costs related to the senior notes and subordinated notes totaled $0.5 million and $0.9 million, respectively, at December 31, 2018.

Junior Subordinated Debt Owed to Unconsolidated Trusts	3 Months Ended
Junior Subordinated Debt Owed to Unconsolidated Trusts	Mar. 31, 2019
Junior Subordinated Debt Owed to Unconsolidated Trusts
Junior Subordinated Debt Owed to Unconsolidated Trusts	Note 7: Junior Subordinated Debt Owed to Unconsolidated Trusts First Busey maintains statutory trusts for the sole purpose of issuing and servicing trust preferred securities and related trust common securities. The proceeds from such issuances were used by the trusts to purchase junior subordinated notes of the Company, which are the sole assets of each trust. Concurrent with the issuance of the trust preferred securities, the Company issued guarantees for the benefit of the holders of the trust preferred securities. The trust preferred securities are instruments that qualify, and are treated by the Company, as Tier 1 regulatory capital. The Company owns all of the common securities of each trust. The trust preferred securities issued by each trust rank equally with the common securities in right of payment, except that if an event of default under the indenture governing the notes has occurred and is continuing, the preferred securities will rank senior to the common securities in right of payment. In connection with the acquisition of Pulaski Financial Corp. (“Pulaski”) in 2016, the Company acquired similar statutory trusts maintained by Pulaski and the fair value adjustment is being accreted over the weighted average remaining life. The Company had $71.2 million of junior subordinated debt owed to unconsolidated trusts at March 31, 2019 and December 31, 2018. The trust preferred securities are subject to mandatory redemption, in whole or in part, upon repayment of the junior subordinated notes at par value at the stated maturity date or upon redemption. Each trust’s ability to pay amounts due on the trust preferred securities is solely dependent upon the Company making payment on the related junior subordinated notes. The Company’s obligations under the junior subordinated notes and other relevant trust agreements, in aggregate, constitute a full and unconditional guarantee by the Company of each trust’s obligations under the trust preferred securities issued by each trust. The Company has the right to defer payment of interest on the notes, in which case the distributions on the trust preferred securities will also be deferred, for up to five years, but not beyond the stated maturity date. Under current banking regulations, bank holding companies are allowed to include qualifying trust preferred securities in their Tier 1 Capital for regulatory capital purposes, subject to a 25% limitation to all core (Tier 1) capital elements, net of goodwill and other intangible assets less any associated deferred tax liability. As of March 31, 2019, 100% of the trust preferred securities qualified as Tier 1 capital under the final rule adopted in March 2005. The Dodd-Frank Act mandated the Federal Reserve to establish minimum capital levels for holding companies on a consolidated basis as stringent as those required for FDIC-insured institutions. A result of this change is that the proceeds of hybrid instruments, such as trust preferred securities, are excluded from capital over a phase-out period. However, if such securities were issued prior to May 19, 2010 by bank holding companies with less than $15.0 billion of assets, they may be retained, subject to certain restrictions. Because the Company has assets of less than $15.0 billion, it is able to maintain its trust preferred proceeds as capital, but the Company has to comply with new capital mandates in other respects and will not be able to raise capital in the future through the issuance of trust preferred securities.

Earnings Per Common Share

3 Months Ended

Mar. 31, 2019

Earnings Per Common Share

Earnings Per Common Share

Note 8: Earnings Per Common Share

Earnings per common share have been computed as follows (in thousands, except per share data):


	Three Months Ended
	March 31,
	2019		2018
Net income	$	25,469	$	21,917
Shares:
Weighted average common shares outstanding		53,277		48,775
Dilutive effect of outstanding options, warrants and restricted stock units as determined by the application of the treasury stock method		301		404

Weighted average common shares outstanding, as adjusted for diluted earnings per share calculation		53,578		49,179

Basic earnings per common share	$	0.48	$	0.45

Diluted earnings per common share	$	0.48	$	0.45

Basic earnings per share is computed by dividing net income for the period by the weighted average number of common shares outstanding, which include deferred stock units that are vested but not delivered.

Diluted earnings per common share is computed using the treasury stock method and reflects the potential dilution that could occur if the Company’s outstanding stock options and warrants were exercised and restricted stock units were vested. At March 31, 2019, 172,571 outstanding restricted stock units, 49,646 outstanding stock options, and 191,278 warrants were anti-dilutive and excluded from the calculation of common stock equivalents. At March 31, 2018, 191,278 warrants were anti-dilutive and excluded from the calculation of common stock equivalents.

Share-based Compensation

3 Months Ended

Mar. 31, 2019

Share-based Compensation

Share-based Compensation

Note 9: Share-based Compensation

The Company currently grants share-based compensation in the form of restricted stock units (“RSUs”) and deferred stock units (“DSUs”). The Company grants RSUs to members of management periodically throughout the year. Each RSU is equivalent to one share of the Company’s common stock. These units have requisite service periods ranging from one to five years. The Company annually grants share-based awards in the form of DSUs, which are RSUs with a deferred settlement date, to its board of directors and advisory directors. Each DSU is equivalent to one share of the Company’s common stock. The DSUs vest over a twelve-month period following the grant date or on the date of the next Annual Meeting of Stockholders, whichever is earlier. These units generally are subject to the same terms as RSUs under the Company’s 2010 Equity Plan or the First Community 2016 Equity Plan, except that, following vesting, settlement occurs within 30 days following the earlier of separation from the board or a change in control of the Company. Subsequent to vesting and prior to delivery, these units will continue to earn dividend equivalents. The Company also has outstanding stock options granted prior to 2011 and stock options assumed from acquisitions.

A description of the 2010 Equity Incentive Plan, which was amended in 2015, can be found in the Company’s Proxy Statement for the 2015 Annual Meeting of Stockholders. A description of the First Community 2016 Equity Incentive Plan can be found in the Proxy Statement of First Community Financial Partners, Inc. for the 2016 Annual Meeting of Stockholders.

Stock Option Plan

A summary of the status of and changes in the Company's stock option awards for the three months ended March 31, 2019 follows:


		Weighted-		Weighted-
		Average		Average
		Exercise		Remaining Contractual
	Shares	Price		Term
Outstanding at beginning of period	87,600	$	20.58
Exercised	(8,712)		12.93
Forfeited	(1,319)		23.53
Expired	(176)		21.03
Outstanding at end of period	77,393	$	21.39	5.16
Exercisable at end of period	61,146	$	20.82	4.50

The Company recorded an insignificant amount in stock option compensation expense for the three months ended March 31, 2019, related to the converted options from First Community. The Company recorded $0.1 million in stock option compensation expense for the three months ended March 31, 2018. As of March 31, 2019, the Company had $0.1 million of unrecognized stock option expense. This cost is expected to be recognized in 2019.

Restricted Stock Unit Plan

A summary of the changes in the Company’s stock unit awards for the three months ended March 31, 2019, is as follows:


		Weighted-		Director	Weighted-
	Restricted	Average		Deferred	Average
	Stock	Grant Date		Stock	Grant Date
	Units	Fair Value		Units	Fair Value
Non-vested at beginning of period	690,495	$	26.14	20,449	$	27.93
Granted	—		—	—		—
Dividend equivalents earned	5,729		25.31	157		25.31
Vested	—		—	(1,512)		31.67
Forfeited	—		—	(1,523)		31.62
Non-vested at end of period	696,224	$	26.13	17,571	$	27.26
Outstanding at end of period	696,224	$	26.13	76,750	$	27.57

Recipients earn quarterly dividend equivalents on their respective units which entitle the recipients to additional units. Therefore, dividends earned each quarter compound based upon the updated unit balances. Upon vesting/delivery, shares are expected (though not required) to be issued from treasury.

The Company recognized $1.0 million and $0.8 million of compensation expense related to both non-vested RSUs and DSUs for the three months ended March 31, 2019 and 2018, respectively. As of March 31, 2019, there was $9.9 million of total unrecognized compensation cost related to these non-vested stock awards. This cost is expected to be recognized over a period of 3.5 years.

As of March 31, 2019, 731,118 shares remain available for issuance pursuant to the Company’s 2010 Equity Incentive Plan, 59,329 shares remain available for issuance pursuant to the Company’s Employee Stock Purchase Plan and 308,617 shares remain available for issuance pursuant to the First Community 2016 Equity Incentive Plan.

Outstanding Commitments and Contingent Liabilities

3 Months Ended

Mar. 31, 2019

Outstanding Commitments and Contingent Liabilities

Outstanding Commitments and Contingent Liabilities

Note 10: Outstanding Commitments and Contingent Liabilities

Legal Matters

The Company is a party to legal actions which arise in the normal course of its business activities. In the opinion of management, the ultimate resolution of these matters is not expected to have a material effect on the financial position or the results of operations of the Company.

Credit Commitments and Contingencies

A summary of the contractual amount of the Company’s exposure to off-balance-sheet risk relating to the Company’s commitments to extend credit and standby letters of credit follows (dollars in thousands):


	March 31, 2019		December 31, 2018
Financial instruments whose contract amounts represent credit risk:
Commitments to extend credit	$	1,600,624	$	1,398,483
Standby letters of credit		35,334		32,156

Regulatory Capital

3 Months Ended

Mar. 31, 2019

Regulatory Capital

Regulatory Capital

Note 11: Regulatory Capital

The Company and the subsidiary banks are subject to various regulatory capital requirements administered by federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory—and possibly additional discretionary—actions by regulators that, if undertaken, could have a direct material effect on the Company's financial statements. The capital amounts and classification also are subject to qualitative judgments by the regulators about components, risk weightings and other factors.

Banking regulations identify five capital categories for insured depository institutions: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized and critically undercapitalized. As of March 31, 2019 and December 31, 2018, all capital ratios of the Company and the subsidiary banks exceeded the well capitalized levels under the applicable regulatory capital adequacy guidelines. Management believes that no events or changes have occurred subsequent to March 31, 2019 that would change this designation.

The following tables summarize the applicable holding company and bank regulatory capital requirements (dollars in thousands):


									Minimum
					Minimum				To Be Well
	Actual				Capital Requirement				Capitalized
	Amount		Ratio		Amount		Ratio		Amount		Ratio
As of March 31, 2019:
Total Capital (to Risk Weighted Assets)
Consolidated	$	1,009,053	13.95	%	$	578,555	8.00	%	$	723,194	10.00	%
Busey Bank	$	882,181	14.49	%	$	487,119	8.00	%	$	608,899	10.00	%
TheBANK	$	190,105	16.78	%	$	90,646	8.00	%	$	113,308	10.00	%

Tier 1 Capital (to Risk Weighted Assets)
Consolidated	$	898,138	12.42	%	$	433,917	6.00	%	$	578,555	8.00	%
Busey Bank	$	831,371	13.65	%	$	365,340	6.00	%	$	487,119	8.00	%
TheBANK	$	190,000	16.77	%	$	67,985	6.00	%	$	90,646	8.00	%

Common Equity Tier 1 Capital (to Risk Weighted Assets)
Consolidated	$	824,138	11.40	%	$	325,438	4.50	%	$	470,076	6.50	%
Busey Bank	$	831,371	13.65	%	$	274,005	4.50	%	$	395,785	6.50	%
TheBANK	$	190,000	16.77	%	$	50,989	4.50	%	$	73,650	6.50	%

Tier 1 Capital (to Average Assets)
Consolidated	$	898,138	10.55	%	$	340,417	4.00	%		N/A	N/A
Busey Bank	$	831,371	11.25	%	$	295,723	4.00	%	$	369,654	5.00	%
TheBANK	$	190,000	11.10	%	$	68,472	4.00	%	$	85,589	5.00	%


									Minimum
					Minimum				To Be Well
	Actual				Capital Requirement				Capitalized
	Amount		Ratio		Amount		Ratio		Amount		Ratio
As of December 31, 2018:
Total Capital (to Risk Weighted Assets)
Consolidated	$	894,572	14.83	%	$	482,638	8.00	%	$	603,297	10.00	%
Busey Bank	$	854,351	14.19	%	$	481,701	8.00	%	$	602,126	10.00	%

Tier 1 Capital (to Risk Weighted Assets)
Consolidated	$	783,924	12.99	%	$	361,978	6.00	%	$	482,638	8.00	%
Busey Bank	$	803,703	13.35	%	$	361,276	6.00	%	$	481,701	8.00	%

Common Equity Tier 1 Capital (to Risk Weighted Assets)
Consolidated	$	709,924	11.77	%	$	271,484	4.50	%	$	392,143	6.50	%
Busey Bank	$	803,703	13.35	%	$	270,957	4.50	%	$	391,382	6.50	%

Tier 1 Capital (to Average Assets)
Consolidated	$	783,924	10.36	%	$	302,704	4.00	%		N/A	N/A
Busey Bank	$	803,703	10.64	%	$	302,232	4.00	%	$	377,789	5.00	%

In July 2013, the U.S. federal banking authorities approved the Basel III Rule for strengthening international capital standards. The Basel III Rule introduced a capital conservation buffer, composed entirely of Common Equity Tier 1 Capital (“CET1”), which is added to the minimum risk-weighted asset ratios. The capital conservation buffer is not a minimum capital requirement; however, banking institutions with a ratio of CET1 to risk-weighted assets below the capital conservation buffer will face constraints on dividends, equity repurchases and discretionary bonus payments based on the amount of the shortfall. In order to refrain from restrictions on dividends, equity repurchases and discretionary bonus payments, banking institutions must maintain minimum ratios of (i) CET1 to risk-weighted assets of at least 7.0%, (ii) Tier 1 capital to risk-weighted assets of at least 8.5%, and (iii) Total capital to risk-weighted assets of at least 10.5%.

The ability of the Company to pay cash dividends to its stockholders and to service its debt was historically dependent on the receipt of cash dividends from its subsidiaries. Under applicable regulatory requirements, an Illinois state-chartered bank such as Busey Bank may not pay dividends in excess of its net profits. Because Busey Bank had been in an accumulated deficit position since 2009, it was not able to pay dividends in prior years. With prior approval from its regulators, however, an Illinois state-chartered bank in that situation was able to reduce its capital stock by amending its charter to decrease the authorized number of shares, and then make a subsequent distribution to its holding company. Using this approach, and with the approval of its regulators, Busey Bank has distributed funds to the Company, the most recent of which was $40.0 million on October 12, 2018. Busey Bank returned to positive retained earnings in the second quarter of 2018. Busey Bank will return to paying dividends in 2019.

- Definition

The entire disclosure for banks, savings institutions, and credit unions, for regulatory capital requirements imposed by the Federal Reserve System (FRB), the Federal Deposit Insurance Corporation (FDIC), the Office of Thrift Supervision (OTS) or for any state imposed capital requirements, as applicable. The disclosure may include (1) a description of regulatory capital requirements (a) for capital adequacy purposes and (b) established by the prompt corrective action provisions of Section 38 of the Federal Depository Insurance Act; (2) the actual or possible material effects of noncompliance with such requirements; (3) whether the entity is in compliance with the regulatory capital requirements including (a) required and actual ratios and amounts of Tier 1 leverage, Tier 1 risk-based, and total risk-based capital, tangible capital (for savings institutions), and Tier 3 capital for market risk (for certain banks and bank holding companies), (b) factors that may significantly affect capital adequacy; (4) the prompt corrective action category in which the entity was classified as of its most recent notification; (5) whether management believes any conditions or events since notification have changed the entity's category. Also may include additional information that might be disclosed in situations where substantial doubt about the entity's ability to continue as a going concern for a reasonable period of time.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 505
-Section 50
-Paragraph 1G
-URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958577-112826

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 505
-Section 50
-Paragraph 1C
-URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958572-112826

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 505
-Section 50
-Paragraph 1E
-URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958574-112826

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 505
-Section 50
-Paragraph 1H
-URI http://asc.fasb.org/extlink&oid=84167132&loc=d3e65071-112826

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 505
-Section 50
-Paragraph 1A
-URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958569-112826

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 505
-Section 50
-Paragraph 1B
-URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958570-112826

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 505
-Section 50
-Paragraph 1F
-URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958575-112826

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 505
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958568-112826

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 505
-Section 50
-Paragraph 1D
-URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958573-112826

+ Details

Operating Segments and Related Information

3 Months Ended

Mar. 31, 2019

Operating Segments and Related Information

Operating Segments and Related Information

Note 12: Operating Segments and Related Information

The Company has three reportable operating segments, Banking, Remittance Processing and Wealth Management. The Banking operating segment provides a full range of banking services to individual and corporate customers through its banking center network in Illinois, St. Louis, Missouri metropolitan area, southwest Florida and through its banking center in Indianapolis, Indiana. Banking services for Busey Bank and TheBANK are aggregated into the banking operating segment as they have similar operations and activities. The Remittance Processing operating segment provides for online bill payments, lockbox and walk-in payments. The Wealth Management operating segment provides a full range of asset management, investment and fiduciary services to individuals, businesses and foundations, tax preparation, philanthropic advisory services and farm and brokerage services.

The Company’s three operating segments are strategic business units that are separately managed as they offer different products and services and have different marketing strategies. The “other” category consists of the Parent Company and the elimination of intercompany transactions.

The segment financial information provided below has been derived from information used by management to monitor and manage the financial performance of the Company. The accounting policies of the three segments are the same as those described in the summary of significant accounting policies in the “Note 1. Significant Accounting Policies” to Form 10-K. The Company accounts for intersegment revenue and transfers at current market value.

Following is a summary of selected financial information for the Company’s operating segments (dollars in thousands):


	Goodwill				Total Assets
	March 31, 2019		December 31, 2018		March 31, 2019		December 31, 2018

Banking	$	293,657	$	246,999	$	9,499,513	$	7,656,709
Remittance Processing		8,992		8,992		41,467		39,278
Wealth Management		11,694		11,694		22,894		20,992
Other		—		—		(26,540)		(14,622)
Totals	$	314,343	$	267,685	$	9,537,334	$	7,702,357


	Three Months Ended March 31,
	2019		2018
Net interest income:
Banking	$	70,638	$	61,416
Remittance Processing		18		16
Wealth Management		—		94
Other		(2,273)		(1,769)
Total net interest income	$	68,383	$	59,757

Non-interest income:
Banking	$	12,783	$	10,897
Remittance Processing		4,181		3,783
Wealth Management		9,133		8,641
Other		(152)		(835)
Total non-interest income	$	25,945	$	22,486

Non-interest expense:
Banking	$	45,171	$	41,386
Remittance Processing		2,764		2,466
Wealth Management		5,564		4,911
Other		3,664		2,277
Total non-interest expense	$	57,163	$	51,040

Income before income taxes:
Banking	$	36,139	$	29,919
Remittance Processing		1,435		1,333
Wealth Management		3,569		3,824
Other		(6,089)		(4,881)
Total income before income taxes	$	35,054	$	30,195

Net income:
Banking	$	26,665	$	21,845
Remittance Processing		1,025		953
Wealth Management		2,641		2,764
Other		(4,862)		(3,645)
Total net income	$	25,469	$	21,917

Derivative Financial Instruments

3 Months Ended

Mar. 31, 2019

Derivative Financial Instruments

Derivative Financial Instruments

Note 13: Derivative Financial Instruments

The Company enters into derivative financial instruments, including interest rate lock commitments issued to residential loan customers for loans that will be held for sale, forward sales commitments to sell residential mortgage loans to loan investors and derivatives to customers for interest rate swaps. See “Note 14: Fair Value Measurements” for further discussion of the fair value measurement of such derivatives.

Interest Rate Lock Commitments. At March 31, 2019 and December 31, 2018, the Company had issued $53.8 million and $27.2 million, respectively, of unexpired interest rate lock commitments to loan customers. Such interest rate lock commitments that meet the definition of derivative financial instruments under ASC Topic 815, Derivatives and Hedging, are carried at their fair values in other assets or other liabilities in the unaudited consolidated financial statements, with changes in the fair values of the corresponding derivative financial assets or liabilities recorded as either a charge or credit to current earnings during the period in which the changes occurred.

Forward Sales Commitments. At March 31, 2019 and December 31, 2018, the Company had issued $69.2 million and $48.6 million, respectively, of unexpired forward sales commitments to mortgage loan investors. Typically, the Company economically hedges mortgage loans held for sale and interest rate lock commitments issued to its residential loan customers related to loans that will be held for sale by obtaining corresponding best-efforts forward sales commitments with an investor to sell the loans at an agreed-upon price at the time the interest rate locks are issued to the customers. Forward sales commitments that meet the definition of derivative financial instruments under ASC Topic 815, Derivatives and Hedging, are carried at their fair values in other assets or other liabilities in the unaudited consolidated financial statements. While such forward sales commitments generally served as an economic hedge to the mortgage loans held for sale and interest rate lock commitments, the Company did not designate them for hedge accounting treatment. Changes in fair value of the corresponding derivative financial asset or liability were recorded as either a charge or credit to current earnings during the period in which the changes occurred.

The fair values of derivative assets and liabilities related to interest rate lock commitments and forward sales commitments recorded in the unaudited Consolidated Balance Sheets are summarized as follows (dollars in thousands):


	March 31, 2019		December 31, 2018
Fair value recorded in other assets	$	835	$	624
Fair value recorded in other liabilities		1,118		1,205

The gross gains and losses on these derivative assets and liabilities related to interest rate lock commitments and forward sales commitments recorded in non-interest income and expense in the unaudited Consolidated Statements of Income are summarized as follows (dollars in thousands):


	Three Months Ended March 31,
	2019		2018
Gross gains	$	1,078	$	732
Gross (losses)		(1,118)		(1,054)
Net gains (losses)	$	(40)	$	(322)

The impact of the net gains or losses on derivative financial instruments related to interest rate lock commitments issued to residential loan customers for loans that will be held for sale and forward sales commitments to sell residential mortgage loans to loan investors are almost entirely offset by a corresponding change in the fair value of loans held for sale.

Derivatives to Customers. The Company may offer derivative contracts to its customers in connection with their risk management needs. These derivatives are primarily interest rate swaps. The Company manages the risk associated with these contracts by entering into an equal and offsetting derivative with a third-party dealer. With notional values of $334.7 million and $243.7 million at March 31, 2019 and December 31, 2018, respectively, these contracts support variable rate, commercial loan relationships totaling $167.4 million and $121.8 million, respectively. These derivatives generally worked together as an economic interest rate hedge, but the Company did not designate them for hedge accounting treatment. Consequently, changes in fair value of the corresponding derivative financial asset or liability were recorded as either a charge or credit to current earnings during the period in which the changes occurred.

The fair values of derivative assets and liabilities related to derivatives for customers for interest rate swaps recorded in the unaudited Consolidated Balance Sheets are summarized as follows (dollars in thousands):


		March 31, 2019		December 31, 2018
Fair value recorded in other assets	$	5,151	$	1,438
Fair value recorded in other liabilities		5,151		1,438

The gross gains and losses on these derivative assets and liabilities recorded in non-interest income and non-interest expense in the unaudited Consolidated Statements of Income are summarized as follows (dollars in thousands):


	Three Months Ended March 31,
		March 31, 2019		March 31, 2018
Gross gains	$	3,713	$	954
Gross losses		(3,713)		(954)
Net gains (losses)	$	—	$	—

The Company pledged $5.7 million in cash to secure its obligation under these contracts at March 31, 2019. The Company pledged $1.0 million in cash to secure its obligation under contracts at December 31, 2018.

Fair Value Measurements

3 Months Ended

Mar. 31, 2019

Fair Value Measurements

Fair Value Measurements

Note 14: Fair Value Measurements

The fair value of an asset or liability is the price that would be received by selling that asset or paid in transferring that liability (exit price) in an orderly transaction occurring in the principal market (or most advantageous market in the absence of a principal market) for such asset or liability. ASC Topic 820, Fair Value Measurement, establishes a fair value hierarchy for valuation inputs that gives the highest priority to quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The fair value hierarchy is as follows:

Level 1 Inputs - Unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.

Level 2 Inputs - Inputs other than quoted prices included in level 1 that are observable for the asset or liability, either directly or indirectly. These might include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (such as interest rates, volatilities, prepayment speeds, credit risks, etc.) or inputs that are derived principally from or corroborated by market data by correlation or other means.

Level 3 Inputs - Unobservable inputs for determining the fair values of assets or liabilities that reflect the Company’s own assumptions about the assumptions that market participants would use in pricing the assets or liabilities.

A description of the valuation methodologies used for instruments measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy, is set forth below. These valuation methodologies were applied to those Company assets and liabilities that are carried at fair value.

There were no transfers between levels during the quarter ended March 31, 2019.

In general, fair value is based upon quoted market prices, when available. If such quoted market prices are not available, fair values are measured utilizing independent valuation techniques of identical or similar securities for which significant assumptions are derived primarily from or corroborated by observable data. Valuation adjustments may be made to ensure that financial instruments are recorded at fair value. These adjustments may include amounts to reflect, among other things, counterparty credit quality and the company's creditworthiness as well as unobservable parameters. Any such valuation adjustments are applied consistently over time. While management believes the Company's valuation methodologies are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different estimate of fair value at the reporting date.

Securities Available for Sale. Securities classified as available for sale are reported at fair value utilizing level 2 measurements. The Company obtains fair value measurements from an independent pricing service. The independent pricing service utilizes evaluated pricing models that vary by asset class and incorporate available trade, bid and other market information. Because many fixed income securities do not trade on a daily basis, the independent pricing service applies available information, focusing on observable market data such as benchmark curves, benchmarking of like securities, sector groupings, and matrix pricing, to prepare evaluations.

The independent pricing service uses model processes, such as the Option Adjusted Spread model, to assess interest rate impact and develop prepayment scenarios. The models and processes take into account market conventions. For each asset class, a team of evaluators gathers information from market sources and integrates relevant credit information, perceived market movements and sector news into the evaluated pricing applications and models.

The market inputs that the independent pricing service normally seeks for evaluations of securities, listed in approximate order of priority, include: benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data including market research publications. The independent pricing service also monitors market indicators, industry and economic events. For certain security types, additional inputs may be used or some of the market inputs may not be applicable. Evaluators may prioritize inputs differently on any given day for any security based on market conditions, and not all inputs listed are available for use in the evaluation process for each security evaluation on a given day. Because the data utilized was observable, the securities have been classified as level 2.

Securities Equity Investments. Securities classified as equity investments are reported at fair value utilizing level 1 measurements. For mutual funds and other equity securities, unadjusted quoted prices in active markets for identical assets are utilized to determine fair value at the measurement date and have been classified as level 1.

Loans Held for Sale. Loans held for sale are reported at fair value utilizing level 2 measurements. The fair value of the mortgage loans held for sale are measured using observable quoted market or contract prices or market price equivalents and are classified as level 2.

Derivative Assets and Derivative Liabilities. Derivative assets and derivative liabilities are reported at fair value utilizing level 2 measurements. The fair value of derivative assets and liabilities is determined based on prices that are obtained from a third-party which uses observable market inputs. Derivative assets and liabilities are classified as level 2.

The following table summarizes financial assets and financial liabilities measured at fair value on a recurring basis, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value (dollars in thousands):


	Level 1		Level 2		Level 3		Total
March 31, 2019	Inputs		Inputs		Inputs		Fair Value
Fair value adjusted through comprehensive income:
Securities available for sale
U.S. Treasury securities	$	—	$	64,309	$	—	$	64,309
Obligations of U.S. government corporations and agencies		—		325,420		—		325,420
Obligations of states and political subdivisions		—		283,478		—		283,478
Commercial mortgage-backed securities		—		55,562		—		55,562
Residential mortgage-backed securities		—		1,049,761		—		1,049,761
Corporate debt securities		—		139,765		—		139,765
Fair value adjusted through current period earnings:
Securities equity investments		6,378		—		—		6,378
Loans held for sale		—		20,291		—		20,291
Derivative assets		—		5,986		—		5,986
Derivative liabilities		—		6,269		—		6,269


	Level 1		Level 2		Level 3		Total
December 31, 2018	Inputs		Inputs		Inputs		Fair Value
Securities available for sale
U.S. Treasury securities	$	—	$	25,411	$	—	$	25,411
Obligations of U.S. government corporations and agencies		—		52,342		—		52,342
Obligations of states and political subdivisions		—		170,044		—		170,044
Commercial mortgage-backed securities		—		1,942		—		1,942
Residential mortgage-backed securities		—		315,748		—		315,748
Corporate debt securities		—		132,198		—		132,198
Fair value adjusted through period earnings:
Securities equity investments		6,169		—		—		6,169
Loans held for sale		—		25,895		—		25,895
Derivative assets		—		2,062		—		2,062
Derivative liabilities		—		2,643		—		2,643

Certain financial assets and financial liabilities are measured at fair value on a non-recurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment).

Impaired Loans. The Company does not record loans at fair value on a recurring basis. However, periodically, a loan is identified as impaired and is reported at the fair value of the underlying collateral, less estimated costs to sell, if repayment is expected solely from the collateral. Impaired loans measured at fair value typically consist of loans on non-accrual status and restructured loans in compliance with modified terms. Collateral values are estimated using a combination of observable inputs, including recent appraisals, and unobservable inputs based on customized discounting criteria. Due to the significance of the unobservable inputs, all impaired loan fair values have been classified as level 3.

OREO. Non-financial assets and non-financial liabilities measured at fair value include OREO (upon initial recognition or subsequent impairment). OREO properties are measured using a combination of observable inputs, including recent appraisals, and unobservable inputs. Due to the significance of the unobservable inputs, all OREO fair values have been classified as level 3.

Bank Property Held for Sale. Bank property held for sale represents certain banking center office buildings which the Company has closed and consolidated with other existing banking centers. Bank property held for sale is measured at the lower of amortized cost or fair value less estimated costs to sell. The fair values were based upon appraisals or real estate listing price. Due to the significance of the unobservable inputs, all bank property held for sale fair values have been classified as level 3.

The following table summarizes assets and liabilities measured at fair value on a non-recurring basis, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value (dollars in thousands):


	Level 1		Level 2		Level 3		Total
	Inputs		Inputs		Inputs		Fair Value
March 31, 2019
Impaired loans	$	—	$	—	$	10,001	$	10,001
OREO		—		—		84		84
Bank property held for sale		—		—		1,832		1,832


December 31, 2018
Impaired loans	$	—	$	—	$	10,999	$	10,999
OREO		—		—		55		55
Bank property held for sale		—		—		1,832		1,832

The following table presents additional quantitative information about assets measured at fair value on a non-recurring basis for which the Company has utilized level 3 inputs to determine fair value (dollars in thousands):


	Quantitative Information about Level 3 Fair Value Measurements
	Fair Value		Valuation	Unobservable	Range
	Estimate		Techniques	Input	(Weighted Average)
March 31, 2019
Impaired loans	$	10,001	Appraisal of collateral	Appraisal adjustments	- 4.1	%	to	- 100.0	%
					(-25.6)%
OREO		84	Appraisal of collateral	Appraisal adjustments	- 25.0	%	to	- 100.0	%
					(-61.8)%
Bank property held for sale		1,832	Appraisal of collateral or real estate listing price	Appraisal adjustments	- 0.0	%	to	- 35.1	%
					(-28.3)%
	Quantitative Information about Level 3 Fair Value Measurements
	Fair Value		Valuation	Unobservable	Range
	Estimate		Techniques	Input	(Weighted Average)
December 31, 2018
Impaired loans	$	10,999	Appraisal of collateral	Appraisal adjustments	- 3.3	%	to	- 100.0	%
					(-24.1)%
OREO		55	Appraisal of collateral	Appraisal adjustments	- 25.0	%	to	- 100.0	%
					(-65.0)%
Bank property held for sale		1,832	Appraisal of collateral or real estate listing price	Appraisal adjustments	- 0.0	%	to	- 35.1	%
					(-28.3)%

The estimated fair values of financial instruments that are reported at amortized cost in the Company’s Consolidated Balance Sheets, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value, were as follows (dollars in thousands):


	March 31, 2019				December 31, 2018
	Carrying		Fair		Carrying		Fair
	Amount		Value		Amount		Value
Financial assets:
Level 1 inputs:
Cash and cash equivalents	$	330,407	$	330,407	$	239,973	$	239,973
Level 2 inputs:
Securities held to maturity		15,846		15,975		608,660		603,360
Accrued interest receivable		29,748		29,748		22,314		22,314
Level 3 inputs:
Portfolio loans, net		6,464,166		6,402,404		5,517,780		5,473,063
Mortgage servicing rights		10,201		16,194		3,315		11,051
Other servicing rights		839		1,413		781		1,443

Financial liabilities:
Level 2 inputs:
Time deposits	$	1,757,078	$	1,746,252	$	1,497,003	$	1,482,301
Securities sold under agreements to repurchase		217,077		217,077		185,796		185,796
Short-term borrowings		30,739		30,871		—		—
Long-term debt		89,476		89,738		50,000		49,873
Junior subordinated debt owed to unconsolidated trusts		71,192		65,152		71,155		65,182
Accrued interest payable		7,589		7,589		6,568		6,568
Level 3 inputs:
Senior notes, net of unamortized issuance costs		39,573		39,797		39,539		39,452
Subordinated notes, net of unamortized issuance costs		59,172		58,748		59,147		58,186

ASC Topic 825 requires disclosure of the fair value of financial assets and financial liabilities, including those financial assets and financial liabilities that are not measured and reported at fair value on a recurring basis or non-recurring basis. A detailed description of the valuation methodologies used in estimating the fair value of financial instruments is set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Leases

3 Months Ended

Mar. 31, 2019

Leases

Leases

Note 15: Leases

The Company has operating leases consisting primarily of equipment leases and real estate leases. The Company leases real estate property for bank branches, ATM locations, and office space with terms extending through 2032. As of March 31, 2019, the Company reported $10.9 million of right-of-use asset and $11.0 million lease liability in its Consolidated Balance Sheets.

The following tables represents lease costs and other lease information for the periods presented (dollars in thousands):


	Three Months Ended March 31,
Lease Costs	2019
Operating lease costs	$	533
Variable lease costs		111
Short-term lease costs		15
Sublease income		-
Net lease cost	$	659

Other information
Cash paid for amounts included in the measurement of lease liabilities:
Operating lease cash flows – Fixed payments	$	513
Operating lease cash flows – Liability reduction		463
Right of use assets obtained during the period in exchange for operating lease liabilities		—
Weighted average lease term (in years)		8.33
Weighted average discount rate		3.11%

At March 31, 2019, the Company was obligated under noncancelable operating leases for office space and other commitments. Rent expense under operating leases, included in net occupancy and equipment expense, was $0.7 million for the three months ended March 31, 2019 and 2018.

Rent commitments were as follows (dollars in thousands):


	Three Months Ended March 31,
	2019
2019	$	1,628
2020		2,094
2021		1,573
2022		1,406
2023		1,249
Thereafter		4,498
Amounts representing interest		(1,466)
Present value of net future minimum lease payments	$	10,982

Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2019

Significant Accounting Policies

Use of Estimates

Leases

Impact of recently adopted accounting standards

The Company elected the package of practical expedients to not reassess prior conclusions related to contracts containing leases, lease classification and initial direct costs;

The Company did not elect the hindsight practical expedient;

The Company elected not to apply the above guidance to short-term leases;

The Company elected to separate the lease components from the nonlease components and exclude the nonlease components from the right-of-use asset and lease liability; and

The Company did not elect the land easement practical expedient.

Acquisition (Tables) - Banc Ed

3 Months Ended

Mar. 31, 2019

Schedule of fair value estimates of assets acquired and liabilities assumed

The following table presents the estimated fair value of Banc Ed’s assets acquired and liabilities assumed as of January 31, 2019 (dollars in thousands):


	Estimated by
	First Busey
Assets acquired:
Cash and cash equivalents	$	42,013
Securities		692,684
Loans held for sale		2,157
Portfolio loans		873,336
Premises and equipment		31,929
Other intangible assets		32,617
Mortgage servicing rights		6,946
Other assets		57,296
Total assets acquired		1,738,978

Liabilities assumed:
Deposits		1,439,203
Other borrowings		63,439
Other liabilities		25,079
Total liabilities assumed		1,527,721

Net assets acquired	$	211,257

Consideration paid:
Cash	$	91,400
Common stock		166,515
Total consideration paid	$	257,915

Goodwill	$	46,658

Schedule of unaudited pro forma results of operations for the acquisition

Only the merger related expenses that have been recognized are included in net income in the table below (dollars in thousands):


	Pro Forma
	Three Months Ended March 31,
	2019		2018
Total revenues (net interest income plus non-interest income)	$	100,652	$	101,119
Net income		27,390		25,813
Diluted earnings per common share		0.49		0.47

Securities (Tables)

3 Months Ended

Mar. 31, 2019

Securities

Schedule of amortized cost, unrealized gains and losses and fair values of securities classified available for sale and held to maturity

The table below provides the amortized cost, unrealized gains and losses and fair values of securities summarized by major category (dollars in thousands):


			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
March 31, 2019:	Cost		Gains		Losses		Value
Available for sale
U.S. Treasury securities	$	64,506	$	76	$	(273)	$	64,309
Obligations of U.S. government corporations and agencies		323,686		2,122		(388)		325,420
Obligations of states and political subdivisions		281,473		2,357		(352)		283,478
Commercial mortgage-backed securities		55,926		29		(393)		55,562
Residential mortgage-backed securities		1,051,556		4,512		(6,307)		1,049,761
Corporate debt securities		138,913		933		(81)		139,765
Total	$	1,916,060	$	10,029	$	(7,794)	$	1,918,295

Held to maturity
Obligations of states and political subdivisions	$	15,846	$	132	$	(3)	$	15,975


			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
December 31, 2018:	Cost		Gains		Losses		Value
Available for sale
U.S. Treasury securities	$	25,824	$	1	$	(414)	$	25,411
Obligations of U.S. government corporations and agencies		53,096		7		(761)		52,342
Obligations of states and political subdivisions		171,131		484		(1,571)		170,044
Commercial mortgage-backed securities		2,003		—		(61)		1,942
Residential mortgage-backed securities		322,646		245		(7,143)		315,748
Corporate debt securities		132,513		61		(376)		132,198
Total	$	707,213	$	798	$	(10,326)	$	697,685

Held to maturity
Obligations of states and political subdivisions	$	33,947	$	68	$	(87)	$	33,928
Commercial mortgage-backed securities		59,054		11		(1,003)		58,062
Residential mortgage-backed securities		515,659		1,748		(6,037)		511,370
Total	$	608,660	$	1,827	$	(7,127)	$	603,360

Schedule of amortized cost and fair value of debt securities available for sale and held to maturity by contractual maturity


	Available for sale				Held to maturity
	Amortized		Fair		Amortized		Fair
March 31, 2019:	Cost		Value		Cost		Value
Due in one year or less	$	166,786	$	166,734	$	1,914	$	1,913
Due after one year through five years		517,731		519,968		12,807		12,909
Due after five years through ten years		276,057		277,308		1,125		1,153
Due after ten years		955,486		954,285		—		—
Total	$	1,916,060	$	1,918,295	$	15,846	$	15,975

Schedule of realized gains and losses related to sales of securities

Realized gains and losses related to sales and calls of securities available for sale are summarized as follows (dollars in thousands):


	Three Months Ended March 31,
	2019		2018
Gross security gains	$	184	$	—
Gross security (losses)		—		—
Security gains (losses), net(1)	$	184	$	—

Security gains (losses), net reported on the Consolidated Statements of Income in 2019 includes gains of equity securities, excluded in this table.

Schedule of securities with gross unrealized losses aggregated by investment category and length of time that individual securities have been in a continuous loss position



	For less than				For greater
	12 months, gross				than 12 months, gross				Total, gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
March 31, 2019:	Value		Losses		Value		Losses		Value		Losses
Available for sale
U.S. Treasury securities	$	7,484	$	(2)	$	24,505	$	(271)	$	31,989	$	(273)
Obligations of U.S. government corporations and agencies		750		(2)		50,966		(386)		51,716		(388)
Obligations of states and political subdivisions		11,453		(28)		63,959		(324)		75,412		(352)
Commercial mortgage-backed securities		—		—		430		(393)		430		(393)
Residential mortgage-backed securities		16,083		(9)		551,248		(6,298)		567,331		(6,307)
Corporate debt securities		7,561		(16)		20,369		(65)		27,930		(81)
Total temporarily impaired securities	$	43,331	$	(57)	$	711,477	$	(7,737)	$	754,808	$	(7,794)

Held to maturity
Obligations of states and political subdivisions	$	—	$	—	$	2,301	$	(3)	$	2,301	$	(3)



	For less than				For greater
	12 months, gross				than 12 months, gross				Total, gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
December 31, 2018:	Value		Losses		Value		Losses		Value		Losses
Available for sale
U.S. Treasury securities	$	995	$	(4)	$	24,343	$	(410)	$	25,338	$	(414)
Obligations of U.S. government corporations and agencies		749		(3)		50,744		(758)		51,493		(761)
Obligations of states and political subdivisions		49,893		(460)		77,651		(1,111)		127,544		(1,571)
Commercial mortgage-backed securities		—		—		1,942		(61)		1,942		(61)
Residential mortgage-backed securities		48,387		(496)		247,573		(6,647)		295,960		(7,143)
Corporate debt securities		90,713		(268)		15,083		(108)		105,796		(376)
Total temporarily impaired securities	$	190,737	$	(1,231)	$	417,336	$	(9,095)	$	608,073	$	(10,326)

Held to maturity
Obligations of states and political subdivisions	$	9,531	$	(33)	$	9,538	$	(54)	$	19,069	$	(87)
Commercial mortgage-backed securities		12,067		(212)		45,041		(791)		57,108		(1,003)
Residential mortgage-backed securities		77,071		(974)		245,128		(5,063)		322,199		(6,037)
Total temporarily impaired securities	$	98,669	$	(1,219)	$	299,707	$	(5,908)	$	398,376	$	(7,127)

Portfolio loans (Tables)

3 Months Ended

Mar. 31, 2019

Portfolio loans

Schedule of distribution of portfolio loans

The distribution of portfolio loans is as follows (dollars in thousands):


	March 31,		December 31,
	2019		2018
Commercial	$	1,657,022	$	1,405,106
Commercial real estate		2,699,491		2,366,823
Real estate construction		387,623		288,197
Retail real estate		1,718,415		1,480,133
Retail other		52,530		28,169
Portfolio loans	$	6,515,081	$	5,568,428

Allowance for loan losses		(50,915)		(50,648)
Portfolio loans, net	$	6,464,166	$	5,517,780

Summary of risk grades segregated by category of portfolio loans (excluding accretable purchase accounting adjustments and clearings)

The following table is a summary of risk grades segregated by category of portfolio loans (excluding accretable purchase accounting adjustments and clearings) (dollars in thousands):


	March 31, 2019
					Special				Substandard
	Pass		Watch		Mention		Substandard		Non-accrual
Commercial	$	1,359,640	$	180,954	$	59,595	$	41,525	$	16,243
Commercial real estate		2,406,213		168,415		89,262		33,585		9,761
Real estate construction		362,541		19,652		3,105		1,346		1,126
Retail real estate		1,671,219		14,202		6,802		7,678		9,080
Retail other		51,101		90		—		16		20
Total	$	5,850,714	$	383,313	$	158,764	$	84,150	$	36,230


	December 31, 2018
					Special				Substandard
	Pass		Watch		Mention		Substandard		Non-accrual
Commercial	$	1,126,257	$	172,449	$	47,000	$	42,532	$	17,953
Commercial real estate		2,106,711		137,214		85,148		36,205		10,298
Real estate construction		268,069		14,562		3,899		1,888		18
Retail real estate		1,448,964		6,425		6,792		5,435		6,698
Retail other		26,707		—		—		—		30
Total	$	4,976,708	$	330,650	$	142,839	$	86,060	$	34,997

Summary of portfolio loans that are past due and still accruing or on a non-accrual status

An analysis of portfolio loans that are past due and still accruing or on a non-accrual status is as follows (dollars in thousands):


	March 31, 2019
	Loans past due, still accruing						Non-accrual
	30-59 Days		60-89 Days		90+Days		Loans
Commercial	$	410	$	1,500	$	72	$	16,243
Commercial real estate		1,662		595		—		9,761
Real estate construction		191		—		—		1,126
Retail real estate		4,442		1,596		284		9,080
Retail other		364		20		—		20
Total	$	7,069	$	3,711	$	356	$	36,230


	December 31, 2018
	Loans past due, still accruing						Non-accrual
	30-59 Days		60-89 Days		90+Days		Loans
Commercial	$	158	$	140	$	775	$	17,953
Commercial real estate		148		558		—		10,298
Real estate construction		121		—		58		18
Retail real estate		4,578		1,368		766		6,698
Retail other		48		2		2		30
Total	$	5,053	$	2,068	$	1,601	$	34,997

Summary of restructured loans

A summary of restructured loans is as follows (dollars in thousands):


	March 31,		December 31,
	2019		2018
In compliance with modified terms	$	11,127	$	8,319
30 — 89 days past due		184		127
Included in non-performing loans		360		392
Total	$	11,671	$	8,838

Schedule of details of impaired loans, segregated by category

The average recorded investment is calculated using the most recent four quarters (dollars in thousands).


	March 31, 2019
	Unpaid		Recorded
	Contractual		Investment		Recorded		Total				Average
	Principal		with No		Investment		Recorded		Related		Recorded
	Balance		Allowance		with Allowance		Investment		Allowance		Investment
Commercial	$	19,507	$	5,605	$	10,787	$	16,392	$	4,126	$	15,165
Commercial real estate		20,174		13,818		4,498		18,316		1,231		18,448
Real estate construction		930		820		—		820		—		586
Retail real estate		16,795		14,815		115		14,930		42		13,792
Retail other		48		20		—		20		—		40
Total	$	57,454	$	35,078	$	15,400	$	50,478	$	5,399	$	48,031


	December 31, 2018
	Unpaid		Recorded
	Contractual		Investment		Recorded		Total				Average
	Principal		with No		Investment		Recorded		Related		Recorded
	Balance		Allowance		with Allowance		Investment		Allowance		Investment
Commercial	$	21,442	$	6,858	$	12,001	$	18,859	$	4,319	$	13,364
Commercial real estate		19,079		13,082		4,498		17,580		1,181		18,077
Real estate construction		478		453		—		453		—		712
Retail real estate		14,418		13,196		61		13,257		61		14,110
Retail other		117		33		—		33		—		40
Total	$	55,534	$	33,622	$	16,560	$	50,182	$	5,561	$	46,303

Schedule of activity on the allowance for loan losses


	As of and for the Three Months Ended March 31, 2019
			Commercial		Real Estate		Retail Real
	Commercial		Real Estate		Construction		Estate		Retail Other		Total
Beginning balance	$	17,829	$	21,137	$	2,723	$	8,471	$	488	$	50,648
Provision for loan losses		1,793		(1,089)		2		1,357		48		2,111
Charged-off		(1,807)		(15)		—		(517)		(130)		(2,469)
Recoveries		183		64		82		192		104		625
Ending balance	$	17,998	$	20,097	$	2,807	$	9,503	$	510	$	50,915


	As of and for the Three Months Ended March 31, 2018
			Commercial		Real Estate		Retail Real
	Commercial		Real Estate		Construction		Estate		Retail Other		Total
Beginning balance	$	14,779	$	21,813	$	2,861	$	13,783	$	346	$	53,582
Provision for loan losses		3,003		1,536		2		(3,662)		129		1,008
Charged-off		(781)		(1,315)		(97)		(530)		(207)		(2,930)
Recoveries		576		56		33		245		79		989
Ending balance	$	17,577	$	22,090	$	2,799	$	9,836	$	347	$	52,649

Schedule of allowance for loan losses and recorded investments in portfolio loans, by category

The following table presents the allowance for loan losses and recorded investments in portfolio loans by category (dollars in thousands):


	As of March 31, 2019
			Commercial		Real Estate		Retail Real
	Commercial		Real Estate		Construction		Estate		Retail Other		Total
Allowance for loan losses
Ending balance attributed to:
Loans individually evaluated for impairment	$	4,126	$	1,231	$	—	$	42	$	—	$	5,399
Loans collectively evaluated for impairment		13,872		18,866		2,807		9,461		510		45,516
Ending balance	$	17,998	$	20,097	$	2,807	$	9,503	$	510	$	50,915

Loans:
Loans individually evaluated for impairment	$	16,361	$	15,733	$	385	$	13,296	$	20	$	45,795
Loans collectively evaluated for impairment		1,640,630		2,679,200		387,238		1,705,025		52,510		6,464,603
PCI loans evaluated for impairment		31		4,558		—		94		—		4,683
Ending balance	$	1,657,022	$	2,699,491	$	387,623	$	1,718,415	$	52,530	$	6,515,081


	As of December 31, 2018
			Commercial		Real Estate		Retail Real
	Commercial		Real Estate		Construction		Estate		Retail Other		Total
Allowance for loan losses
Ending balance attributed to:
Loans individually evaluated for impairment	$	4,319	$	1,181	$	—	$	61	$	—	$	5,561
Loans collectively evaluated for impairment		13,510		19,956		2,723		8,410		488		45,087
Ending balance	$	17,829	$	21,137	$	2,723	$	8,471	$	488	$	50,648

Loans:
Loans individually evaluated for impairment	$	18,441	$	15,318	$	453	$	13,159	$	33	$	47,404
Loans collectively evaluated for impairment		1,386,247		2,349,243		287,744		1,466,876		28,136		5,518,246
PCI loans evaluated for impairment		418		2,262		—		98		—		2,778
Ending balance	$	1,405,106	$	2,366,823	$	288,197	$	1,480,133	$	28,169	$	5,568,428

Deposits (Tables)

3 Months Ended

Mar. 31, 2019

Deposits

Schedule of composition of deposits

The composition of deposits is as follows (dollars in thousands):


	March 31, 2019		December 31, 2018
Demand deposits, noninterest-bearing	$	1,791,339	$	1,464,700
Interest-bearing transaction deposits		1,812,146		1,435,574
Saving deposits and money market deposits		2,402,663		1,852,044
Time deposits		1,757,078		1,497,003
Total	$	7,763,226	$	6,249,321

Schedule of maturities of time deposits

As of March 31, 2019, the scheduled maturities of time deposits are as follows (dollars in thousands):


April 1, 2019 – March 31, 2020	$	1,094,836
April 1, 2020 – March 31, 2021		361,266
April 1, 2021 – March 31, 2022		140,316
April 1, 2022 – March 31, 2023		86,067
April 1, 2023 – March 31, 2024		73,720
Thereafter		873
	$	1,757,078

Borrowings (Tables)

3 Months Ended

Mar. 31, 2019

Borrowings

Summary of long-term debt

Long-term debt is summarized as follows (dollars in thousands):


	March 31,		December 31,
	2019		2018
Notes payable, FHLB, ranging in original maturity from nineteen months to ten years, collateralized by FHLB deposits, residential and commercial real estate loans and FHLB stock.	$	36,976	$	50,000
Notes payable		52,500		—
Total long-term borrowings	$	89,476	$	50,000

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02.22)
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21475-112644

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 470
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=75038535&loc=d3e64711-112823

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(e),(f))
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 55
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=64930739&loc=d3e28878-108400

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21538-112644

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21506-112644

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 1A
-URI http://asc.fasb.org/extlink&oid=64930785&loc=d3e28541-108399

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=64930785&loc=d3e28551-108399

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21521-112644

+ Details

Earnings Per Common Share (Tables)

3 Months Ended

Mar. 31, 2019

Earnings Per Common Share

Schedule of computation of earnings per common share

Earnings per common share have been computed as follows (in thousands, except per share data):


	Three Months Ended
	March 31,
	2019		2018
Net income	$	25,469	$	21,917
Shares:
Weighted average common shares outstanding		53,277		48,775
Dilutive effect of outstanding options, warrants and restricted stock units as determined by the application of the treasury stock method		301		404

Weighted average common shares outstanding, as adjusted for diluted earnings per share calculation		53,578		49,179

Basic earnings per common share	$	0.48	$	0.45

Diluted earnings per common share	$	0.48	$	0.45

Share-based Compensation (Tables)

3 Months Ended

Mar. 31, 2019

Share-based Compensation

Schedule of status of and changes in the Company's stock option awards

A summary of the status of and changes in the Company's stock option awards for the three months ended March 31, 2019 follows:


		Weighted-		Weighted-
		Average		Average
		Exercise		Remaining Contractual
	Shares	Price		Term
Outstanding at beginning of period	87,600	$	20.58
Exercised	(8,712)		12.93
Forfeited	(1,319)		23.53
Expired	(176)		21.03
Outstanding at end of period	77,393	$	21.39	5.16
Exercisable at end of period	61,146	$	20.82	4.50

Summary of the changes in the Company’s stock unit awards

A summary of the changes in the Company’s stock unit awards for the three months ended March 31, 2019, is as follows:


		Weighted-		Director	Weighted-
	Restricted	Average		Deferred	Average
	Stock	Grant Date		Stock	Grant Date
	Units	Fair Value		Units	Fair Value
Non-vested at beginning of period	690,495	$	26.14	20,449	$	27.93
Granted	—		—	—		—
Dividend equivalents earned	5,729		25.31	157		25.31
Vested	—		—	(1,512)		31.67
Forfeited	—		—	(1,523)		31.62
Non-vested at end of period	696,224	$	26.13	17,571	$	27.26
Outstanding at end of period	696,224	$	26.13	76,750	$	27.57

Outstanding Commitments and Contingent Liabilities (Tables)

3 Months Ended

Mar. 31, 2019

Outstanding Commitments and Contingent Liabilities

Schedule of contractual amount of exposure to off-balance-sheet risk


	March 31, 2019		December 31, 2018
Financial instruments whose contract amounts represent credit risk:
Commitments to extend credit	$	1,600,624	$	1,398,483
Standby letters of credit		35,334		32,156

Regulatory Capital (Tables)

3 Months Ended

Mar. 31, 2019

Regulatory Capital

Schedule of applicable holding company and bank regulatory capital requirements

The following tables summarize the applicable holding company and bank regulatory capital requirements (dollars in thousands):


									Minimum
					Minimum				To Be Well
	Actual				Capital Requirement				Capitalized
	Amount		Ratio		Amount		Ratio		Amount		Ratio
As of March 31, 2019:
Total Capital (to Risk Weighted Assets)
Consolidated	$	1,009,053	13.95	%	$	578,555	8.00	%	$	723,194	10.00	%
Busey Bank	$	882,181	14.49	%	$	487,119	8.00	%	$	608,899	10.00	%
TheBANK	$	190,105	16.78	%	$	90,646	8.00	%	$	113,308	10.00	%

Tier 1 Capital (to Risk Weighted Assets)
Consolidated	$	898,138	12.42	%	$	433,917	6.00	%	$	578,555	8.00	%
Busey Bank	$	831,371	13.65	%	$	365,340	6.00	%	$	487,119	8.00	%
TheBANK	$	190,000	16.77	%	$	67,985	6.00	%	$	90,646	8.00	%

Common Equity Tier 1 Capital (to Risk Weighted Assets)
Consolidated	$	824,138	11.40	%	$	325,438	4.50	%	$	470,076	6.50	%
Busey Bank	$	831,371	13.65	%	$	274,005	4.50	%	$	395,785	6.50	%
TheBANK	$	190,000	16.77	%	$	50,989	4.50	%	$	73,650	6.50	%

Tier 1 Capital (to Average Assets)
Consolidated	$	898,138	10.55	%	$	340,417	4.00	%		N/A	N/A
Busey Bank	$	831,371	11.25	%	$	295,723	4.00	%	$	369,654	5.00	%
TheBANK	$	190,000	11.10	%	$	68,472	4.00	%	$	85,589	5.00	%


									Minimum
					Minimum				To Be Well
	Actual				Capital Requirement				Capitalized
	Amount		Ratio		Amount		Ratio		Amount		Ratio
As of December 31, 2018:
Total Capital (to Risk Weighted Assets)
Consolidated	$	894,572	14.83	%	$	482,638	8.00	%	$	603,297	10.00	%
Busey Bank	$	854,351	14.19	%	$	481,701	8.00	%	$	602,126	10.00	%

Tier 1 Capital (to Risk Weighted Assets)
Consolidated	$	783,924	12.99	%	$	361,978	6.00	%	$	482,638	8.00	%
Busey Bank	$	803,703	13.35	%	$	361,276	6.00	%	$	481,701	8.00	%

Common Equity Tier 1 Capital (to Risk Weighted Assets)
Consolidated	$	709,924	11.77	%	$	271,484	4.50	%	$	392,143	6.50	%
Busey Bank	$	803,703	13.35	%	$	270,957	4.50	%	$	391,382	6.50	%

Tier 1 Capital (to Average Assets)
Consolidated	$	783,924	10.36	%	$	302,704	4.00	%		N/A	N/A
Busey Bank	$	803,703	10.64	%	$	302,232	4.00	%	$	377,789	5.00	%

Operating Segments and Related Information (Tables)

3 Months Ended

Mar. 31, 2019

Operating Segments and Related Information

Summary of information relating to operating segments

Following is a summary of selected financial information for the Company’s operating segments (dollars in thousands):


	Goodwill				Total Assets
	March 31, 2019		December 31, 2018		March 31, 2019		December 31, 2018

Banking	$	293,657	$	246,999	$	9,499,513	$	7,656,709
Remittance Processing		8,992		8,992		41,467		39,278
Wealth Management		11,694		11,694		22,894		20,992
Other		—		—		(26,540)		(14,622)
Totals	$	314,343	$	267,685	$	9,537,334	$	7,702,357


	Three Months Ended March 31,
	2019		2018
Net interest income:
Banking	$	70,638	$	61,416
Remittance Processing		18		16
Wealth Management		—		94
Other		(2,273)		(1,769)
Total net interest income	$	68,383	$	59,757

Non-interest income:
Banking	$	12,783	$	10,897
Remittance Processing		4,181		3,783
Wealth Management		9,133		8,641
Other		(152)		(835)
Total non-interest income	$	25,945	$	22,486

Non-interest expense:
Banking	$	45,171	$	41,386
Remittance Processing		2,764		2,466
Wealth Management		5,564		4,911
Other		3,664		2,277
Total non-interest expense	$	57,163	$	51,040

Income before income taxes:
Banking	$	36,139	$	29,919
Remittance Processing		1,435		1,333
Wealth Management		3,569		3,824
Other		(6,089)		(4,881)
Total income before income taxes	$	35,054	$	30,195

Net income:
Banking	$	26,665	$	21,845
Remittance Processing		1,025		953
Wealth Management		2,641		2,764
Other		(4,862)		(3,645)
Total net income	$	25,469	$	21,917

Derivative Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2019

Interest rate lock commitments and forward sales commitments

Summary of fair values of derivative assets and liabilities recorded in consolidated balance sheet


	March 31, 2019		December 31, 2018
Fair value recorded in other assets	$	835	$	624
Fair value recorded in other liabilities		1,118		1,205

Summary of gross gains and losses on derivative assets and liabilities recorded in non-interest income and expense in consolidated statements of income


	Three Months Ended March 31,
	2019		2018
Gross gains	$	1,078	$	732
Gross (losses)		(1,118)		(1,054)
Net gains (losses)	$	(40)	$	(322)

Interest rate swap

Summary of fair values of derivative assets and liabilities recorded in consolidated balance sheet


		March 31, 2019		December 31, 2018
Fair value recorded in other assets	$	5,151	$	1,438
Fair value recorded in other liabilities		5,151		1,438

Summary of gross gains and losses on derivative assets and liabilities recorded in non-interest income and expense in consolidated statements of income


	Three Months Ended March 31,
		March 31, 2019		March 31, 2018
Gross gains	$	3,713	$	954
Gross losses		(3,713)		(954)
Net gains (losses)	$	—	$	—

Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2019

Fair Value Measurements

Schedule of financial assets and financial liabilities measured at fair value on a recurring basis


	Level 1		Level 2		Level 3		Total
March 31, 2019	Inputs		Inputs		Inputs		Fair Value
Fair value adjusted through comprehensive income:
Securities available for sale
U.S. Treasury securities	$	—	$	64,309	$	—	$	64,309
Obligations of U.S. government corporations and agencies		—		325,420		—		325,420
Obligations of states and political subdivisions		—		283,478		—		283,478
Commercial mortgage-backed securities		—		55,562		—		55,562
Residential mortgage-backed securities		—		1,049,761		—		1,049,761
Corporate debt securities		—		139,765		—		139,765
Fair value adjusted through current period earnings:
Securities equity investments		6,378		—		—		6,378
Loans held for sale		—		20,291		—		20,291
Derivative assets		—		5,986		—		5,986
Derivative liabilities		—		6,269		—		6,269


	Level 1		Level 2		Level 3		Total
December 31, 2018	Inputs		Inputs		Inputs		Fair Value
Securities available for sale
U.S. Treasury securities	$	—	$	25,411	$	—	$	25,411
Obligations of U.S. government corporations and agencies		—		52,342		—		52,342
Obligations of states and political subdivisions		—		170,044		—		170,044
Commercial mortgage-backed securities		—		1,942		—		1,942
Residential mortgage-backed securities		—		315,748		—		315,748
Corporate debt securities		—		132,198		—		132,198
Fair value adjusted through period earnings:
Securities equity investments		6,169		—		—		6,169
Loans held for sale		—		25,895		—		25,895
Derivative assets		—		2,062		—		2,062
Derivative liabilities		—		2,643		—		2,643

Schedule of assets and liabilities measured at fair value on a non-recurring basis


	Level 1		Level 2		Level 3		Total
	Inputs		Inputs		Inputs		Fair Value
March 31, 2019
Impaired loans	$	—	$	—	$	10,001	$	10,001
OREO		—		—		84		84
Bank property held for sale		—		—		1,832		1,832


December 31, 2018
Impaired loans	$	—	$	—	$	10,999	$	10,999
OREO		—		—		55		55
Bank property held for sale		—		—		1,832		1,832

Schedule of quantitative information about Level 3 fair value measurements


	Quantitative Information about Level 3 Fair Value Measurements
	Fair Value		Valuation	Unobservable	Range
	Estimate		Techniques	Input	(Weighted Average)
March 31, 2019
Impaired loans	$	10,001	Appraisal of collateral	Appraisal adjustments	- 4.1	%	to	- 100.0	%
					(-25.6)%
OREO		84	Appraisal of collateral	Appraisal adjustments	- 25.0	%	to	- 100.0	%
					(-61.8)%
Bank property held for sale		1,832	Appraisal of collateral or real estate listing price	Appraisal adjustments	- 0.0	%	to	- 35.1	%
					(-28.3)%
	Quantitative Information about Level 3 Fair Value Measurements
	Fair Value		Valuation	Unobservable	Range
	Estimate		Techniques	Input	(Weighted Average)
December 31, 2018
Impaired loans	$	10,999	Appraisal of collateral	Appraisal adjustments	- 3.3	%	to	- 100.0	%
					(-24.1)%
OREO		55	Appraisal of collateral	Appraisal adjustments	- 25.0	%	to	- 100.0	%
					(-65.0)%
Bank property held for sale		1,832	Appraisal of collateral or real estate listing price	Appraisal adjustments	- 0.0	%	to	- 35.1	%
					(-28.3)%

Schedule of estimated fair values of financial instruments


	Quantitative Information about Level 3 Fair Value Measurements
	Fair Value		Valuation	Unobservable	Range
	Estimate		Techniques	Input	(Weighted Average)
March 31, 2019
Impaired loans	$	10,001	Appraisal of collateral	Appraisal adjustments	- 4.1	%	to	- 100.0	%
					(-25.6)%
OREO		84	Appraisal of collateral	Appraisal adjustments	- 25.0	%	to	- 100.0	%
					(-61.8)%
Bank property held for sale		1,832	Appraisal of collateral or real estate listing price	Appraisal adjustments	- 0.0	%	to	- 35.1	%
					(-28.3)%
	Quantitative Information about Level 3 Fair Value Measurements
	Fair Value		Valuation	Unobservable	Range
	Estimate		Techniques	Input	(Weighted Average)
December 31, 2018
Impaired loans	$	10,999	Appraisal of collateral	Appraisal adjustments	- 3.3	%	to	- 100.0	%
					(-24.1)%
OREO		55	Appraisal of collateral	Appraisal adjustments	- 25.0	%	to	- 100.0	%
					(-65.0)%
Bank property held for sale		1,832	Appraisal of collateral or real estate listing price	Appraisal adjustments	- 0.0	%	to	- 35.1	%
					(-28.3)%


	March 31, 2019				December 31, 2018
	Carrying		Fair		Carrying		Fair
	Amount		Value		Amount		Value
Financial assets:
Level 1 inputs:
Cash and cash equivalents	$	330,407	$	330,407	$	239,973	$	239,973
Level 2 inputs:
Securities held to maturity		15,846		15,975		608,660		603,360
Accrued interest receivable		29,748		29,748		22,314		22,314
Level 3 inputs:
Portfolio loans, net		6,464,166		6,402,404		5,517,780		5,473,063
Mortgage servicing rights		10,201		16,194		3,315		11,051
Other servicing rights		839		1,413		781		1,443

Financial liabilities:
Level 2 inputs:
Time deposits	$	1,757,078	$	1,746,252	$	1,497,003	$	1,482,301
Securities sold under agreements to repurchase		217,077		217,077		185,796		185,796
Short-term borrowings		30,739		30,871		—		—
Long-term debt		89,476		89,738		50,000		49,873
Junior subordinated debt owed to unconsolidated trusts		71,192		65,152		71,155		65,182
Accrued interest payable		7,589		7,589		6,568		6,568
Level 3 inputs:
Senior notes, net of unamortized issuance costs		39,573		39,797		39,539		39,452
Subordinated notes, net of unamortized issuance costs		59,172		58,748		59,147		58,186

Leases (Tables)

3 Months Ended

Mar. 31, 2019

Leases

Schedule of lease costs and other lease information

The following tables represents lease costs and other lease information for the periods presented (dollars in thousands):


	Three Months Ended March 31,
Lease Costs	2019
Operating lease costs	$	533
Variable lease costs		111
Short-term lease costs		15
Sublease income		-
Net lease cost	$	659

Other information
Cash paid for amounts included in the measurement of lease liabilities:
Operating lease cash flows – Fixed payments	$	513
Operating lease cash flows – Liability reduction		463
Right of use assets obtained during the period in exchange for operating lease liabilities		—
Weighted average lease term (in years)		8.33
Weighted average discount rate		3.11%

Schedule of future rent commitments

Rent commitments were as follows (dollars in thousands):


	Three Months Ended March 31,
	2019
2019	$	1,628
2020		2,094
2021		1,573
2022		1,406
2023		1,249
Thereafter		4,498
Amounts representing interest		(1,466)
Present value of net future minimum lease payments	$	10,982

Significant Accounting Policies - Impact of new financial accounting standards (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Jan. 01, 2019
Recently Issued Accounting Standards
Lease, Practical Expedients, Package [true/false]	true
Lease, Practical Expedient, Use of Hindsight [true/false]	false
Right of use asset	$ 10,898
Lease liability	10,982
Accounting Standards Update 2017-12
Recently Issued Accounting Standards
Transferred securities from held to maturity to available-for-sale	$ 573,600
Accounting Standards Update 2016-02 \| Restatement
Recently Issued Accounting Standards
Right of use asset		$ 11,600
Lease liability		$ 9,700

Acquisition - The Banc Ed Corp. (Details) $ / shares in Units, $ in Thousands, shares in Millions			3 Months Ended
	Aug. 21, 2019 $ / shares	Jan. 31, 2019 USD ($) $ / shares shares	Mar. 31, 2019 USD ($) $ / shares	Mar. 31, 2018 USD ($) $ / shares	Dec. 31, 2018 USD ($)
Consideration paid
Goodwill			$ 314,343		$ 267,685
Banc Ed
Merger agreement
Share consideration conversion ratio	8.2067
Per share cash consideration entitled (in dollars per share) \| $ / shares	$ 111.53
Number of common shares issued for acquisition \| shares		6.7
Market value of common stock issued		$ 166,500
Common stock		$ 166,515
Share price \| $ / shares		$ 24.76
Assets acquired:
Cash and cash equivalents		$ 42,013
Securities		692,684
Loans held for sale		2,157
Portfolio loans		873,336
Premises and equipment		31,929
Other intangible assets		32,617
Mortgage servicing rights		6,946
Other assets		57,296
Total assets acquired		1,738,978
Liabilities assumed:
Deposits		1,439,203
Other borrowings		63,439
Other liabilities		25,079
Total liabilities assumed		1,527,721
Net assets acquired		211,257
Consideration paid
Cash		91,400
Common stock		166,515
Total consideration paid		257,915
Goodwill		46,658
Aggregate principal outstanding		889,300
Fair value of performing loans, including loans held for sale		871,000
Amount expected to be accreted, gross		17,000
Contractual amount of PCI loans		3,900
Accretable discount on PCI loans		200
Fair value of credit-impaired loans		$ 2,300
Total revenues (net interest income plus non-interest income)			12,300
Net income			3,600
Banc Ed \| Pro Forma
Consideration paid
Total revenues (net interest income plus non-interest income)			100,652,000	$ 101,119,000
Net income			$ 27,390,000	$ 25,813,000
Diluted earnings per common share (in dollars per share) \| $ / shares			$ 490,000.00	$ 470,000.00
Banc Ed \| Non-interest expense
Merger agreement
Business acquisition expenses			$ 1,000

Securities - General Disclosures (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Securities
Equity securities consisting of common stock and money market mutual funds, fair value	$ 6,378	$ 6,169
Unrealized losses recorded	(216)
Available for sale
Amortized Cost	1,916,060	707,213
Gross Unrealized Gains	10,029	798
Gross Unrealized Losses	(7,794)	(10,326)
Fair Value	1,918,295	697,685
Held to maturity
Amortized Cost	15,846	608,660
Gross Unrealized Gains		1,827
Gross Unrealized Losses		(7,127)
Fair Value	15,975	603,360
Available for sale, Amortized Cost
Due in one year or less	166,786
Due after one year through five years	517,731
Due after five years through ten years	276,057
Due after ten years	955,486
Amortized Cost	1,916,060	707,213
Available for sale, Fair Value
Due in one year or less	166,734
Due after one year through five years	519,968
Due after five years through ten years	277,308
Due after ten years	954,285
Fair Value	1,918,295	697,685
Held to maturity, Amortized Cost
Due in one year or less	1,914
Due after one year through five years	12,807
Due after five years through ten years	1,125
Amortized Cost	15,846	608,660
Held to maturity, Fair Value
Due in one year or less	1,913
Due after one year through five years	12,909
Due after five years through ten years	1,153
Fair Value	15,975	603,360
Realized gains and losses related to sales and calls of securities AFS
Gross security gains	184
Security gains (losses), net	184
Available for sale, Fair Value
Continuous unrealized losses existing for less than 12 months, gross	43,331	190,737
Continuous unrealized losses existing for greater than 12 months, gross	711,477	417,336
Total, gross	754,808	608,073
Available for sale, Unrealized Losses
Continuous unrealized losses existing for less than 12 months, gross	(57)	(1,231)
Continuous unrealized losses existing greater than 12 months, gross	(7,737)	(9,095)
Total, gross	$ (7,794)	(10,326)
Held to maturity, Fair Value
Continuous unrealized losses existing for less than 12 months, gross		98,669
Continuous unrealized losses existing for greater than 12 months, gross		299,707
Total, gross		398,376
Held to maturity, Unrealized Losses
Continuous unrealized losses existing for less than 12 months, gross		(1,219)
Continuous unrealized losses existing for greater than 12 months, gross		(5,908)
Total, gross		(7,127)
Security portfolio evaluated for other-than-temporary impairment	1,354
Number of securities in unrealized loss position	366
Securities in unrealized loss position as a percentage of aggregate carrying value of investments	1.02%
Collateral
Realized gains and losses related to sales and calls of securities AFS
Carrying amount of investment securities pledged as collateral	$ 564,000	498,300
U.S. Treasury securities
Available for sale
Amortized Cost	64,506	25,824
Gross Unrealized Gains	76	1
Gross Unrealized Losses	(273)	(414)
Fair Value	64,309	25,411
Available for sale, Amortized Cost
Amortized Cost	64,506	25,824
Available for sale, Fair Value
Fair Value	64,309	25,411
Available for sale, Fair Value
Continuous unrealized losses existing for less than 12 months, gross	7,484	995
Continuous unrealized losses existing for greater than 12 months, gross	24,505	24,343
Total, gross	31,989	25,338
Available for sale, Unrealized Losses
Continuous unrealized losses existing for less than 12 months, gross	(2)	(4)
Continuous unrealized losses existing greater than 12 months, gross	(271)	(410)
Total, gross	(273)	(414)
Obligations of U.S. government corporations and agencies
Available for sale
Amortized Cost	323,686	53,096
Gross Unrealized Gains	2,122	7
Gross Unrealized Losses	(388)	(761)
Fair Value	325,420	52,342
Available for sale, Amortized Cost
Amortized Cost	323,686	53,096
Available for sale, Fair Value
Fair Value	325,420	52,342
Available for sale, Fair Value
Continuous unrealized losses existing for less than 12 months, gross	750	749
Continuous unrealized losses existing for greater than 12 months, gross	50,966	50,744
Total, gross	51,716	51,493
Available for sale, Unrealized Losses
Continuous unrealized losses existing for less than 12 months, gross	(2)	(3)
Continuous unrealized losses existing greater than 12 months, gross	(386)	(758)
Total, gross	(388)	(761)
Obligations of states and political subdivisions
Available for sale
Amortized Cost	281,473	171,131
Gross Unrealized Gains	2,357	484
Gross Unrealized Losses	(352)	(1,571)
Fair Value	283,478	170,044
Held to maturity
Amortized Cost	15,846	33,947
Gross Unrealized Gains	132	68
Gross Unrealized Losses	(3)	(87)
Fair Value	15,975	33,928
Available for sale, Amortized Cost
Amortized Cost	281,473	171,131
Available for sale, Fair Value
Fair Value	283,478	170,044
Held to maturity, Amortized Cost
Amortized Cost	15,846	33,947
Held to maturity, Fair Value
Fair Value	15,975	33,928
Available for sale, Fair Value
Continuous unrealized losses existing for less than 12 months, gross	11,453	49,893
Continuous unrealized losses existing for greater than 12 months, gross	63,959	77,651
Total, gross	75,412	127,544
Available for sale, Unrealized Losses
Continuous unrealized losses existing for less than 12 months, gross	(28)	(460)
Continuous unrealized losses existing greater than 12 months, gross	(324)	(1,111)
Total, gross	(352)	(1,571)
Held to maturity, Fair Value
Continuous unrealized losses existing for less than 12 months, gross		9,531
Continuous unrealized losses existing for greater than 12 months, gross	2,301	9,538
Total, gross	2,301	19,069
Held to maturity, Unrealized Losses
Continuous unrealized losses existing for less than 12 months, gross		(33)
Continuous unrealized losses existing for greater than 12 months, gross	(3)	(54)
Total, gross	(3)	(87)
Commercial mortgage-backed securities
Available for sale
Amortized Cost	55,926	2,003
Gross Unrealized Gains	29
Gross Unrealized Losses	(393)	(61)
Fair Value	55,562	1,942
Held to maturity
Amortized Cost		59,054
Gross Unrealized Gains		11
Gross Unrealized Losses		(1,003)
Fair Value		58,062
Available for sale, Amortized Cost
Amortized Cost	55,926	2,003
Available for sale, Fair Value
Fair Value	55,562	1,942
Held to maturity, Amortized Cost
Amortized Cost		59,054
Held to maturity, Fair Value
Fair Value		58,062
Available for sale, Fair Value
Continuous unrealized losses existing for greater than 12 months, gross	430	1,942
Total, gross	430	1,942
Available for sale, Unrealized Losses
Continuous unrealized losses existing greater than 12 months, gross	(393)	(61)
Total, gross	(393)	(61)
Held to maturity, Fair Value
Continuous unrealized losses existing for less than 12 months, gross		12,067
Continuous unrealized losses existing for greater than 12 months, gross		45,041
Total, gross		57,108
Held to maturity, Unrealized Losses
Continuous unrealized losses existing for less than 12 months, gross		(212)
Continuous unrealized losses existing for greater than 12 months, gross		(791)
Total, gross		(1,003)
Residential mortgage-backed securities
Available for sale
Amortized Cost	1,051,556	322,646
Gross Unrealized Gains	4,512	245
Gross Unrealized Losses	(6,307)	(7,143)
Fair Value	1,049,761	315,748
Held to maturity
Amortized Cost		515,659
Gross Unrealized Gains		1,748
Gross Unrealized Losses		(6,037)
Fair Value		511,370
Available for sale, Amortized Cost
Amortized Cost	1,051,556	322,646
Available for sale, Fair Value
Fair Value	1,049,761	315,748
Held to maturity, Amortized Cost
Amortized Cost		515,659
Held to maturity, Fair Value
Fair Value		511,370
Available for sale, Fair Value
Continuous unrealized losses existing for less than 12 months, gross	16,083	48,387
Continuous unrealized losses existing for greater than 12 months, gross	551,248	247,573
Total, gross	567,331	295,960
Available for sale, Unrealized Losses
Continuous unrealized losses existing for less than 12 months, gross	(9)	(496)
Continuous unrealized losses existing greater than 12 months, gross	(6,298)	(6,647)
Total, gross	(6,307)	(7,143)
Held to maturity, Fair Value
Continuous unrealized losses existing for less than 12 months, gross		77,071
Continuous unrealized losses existing for greater than 12 months, gross		245,128
Total, gross		322,199
Held to maturity, Unrealized Losses
Continuous unrealized losses existing for less than 12 months, gross		(974)
Continuous unrealized losses existing for greater than 12 months, gross		(5,063)
Total, gross		(6,037)
Corporate debt securities
Available for sale
Amortized Cost	138,913	132,513
Gross Unrealized Gains	933	61
Gross Unrealized Losses	(81)	(376)
Fair Value	139,765	132,198
Available for sale, Amortized Cost
Amortized Cost	138,913	132,513
Available for sale, Fair Value
Fair Value	139,765	132,198
Available for sale, Fair Value
Continuous unrealized losses existing for less than 12 months, gross	7,561	90,713
Continuous unrealized losses existing for greater than 12 months, gross	20,369	15,083
Total, gross	27,930	105,796
Available for sale, Unrealized Losses
Continuous unrealized losses existing for less than 12 months, gross	(16)	(268)
Continuous unrealized losses existing greater than 12 months, gross	(65)	(108)
Total, gross	(81)	$ (376)
Accounting Standards Update 2017-12
Realized gains and losses related to sales and calls of securities AFS
Transferred securities from held to maturity to available-for-sale	573,600
Unrealized loss related to transfer of securities from held to maturity to AFS	$ 4,800

Portfolio loans - Distribution (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018	Mar. 31, 2018	Dec. 31, 2017
Portfolio Loans
Portfolio loans	$ 6,515,081	$ 5,568,428
Allowance for loan losses	(50,915)	(50,648)	$ (52,649)	$ (53,582)
Portfolio loans, net	6,464,166	5,517,780
Net deferred loan origination costs	5,400	5,600
Amount of loan reduction due to net accretable purchase accounting adjustments	28,200	13,900
Commercial
Portfolio Loans
Portfolio loans	1,657,022	1,405,106
Allowance for loan losses	(17,998)	(17,829)	(17,577)	(14,779)
Commercial real estate
Portfolio Loans
Portfolio loans	2,699,491	2,366,823
Allowance for loan losses	(20,097)	(21,137)	(22,090)	(21,813)
Real estate construction
Portfolio Loans
Portfolio loans	387,623	288,197
Allowance for loan losses	(2,807)	(2,723)	(2,799)	(2,861)
Retail real estate
Portfolio Loans
Portfolio loans	1,718,415	1,480,133
Allowance for loan losses	(9,503)	(8,471)	(9,836)	(13,783)
Retail other
Portfolio Loans
Portfolio loans	52,530	28,169
Allowance for loan losses	$ (510)	$ (488)	$ (347)	$ (346)

Portfolio loans - Narrative (Details)	3 Months Ended
Portfolio loans - Narrative (Details)	Mar. 31, 2019 USD ($) contract	Mar. 31, 2018 USD ($) loan	Dec. 31, 2018 USD ($)
Portfolio Loans
Net deferred loan origination costs	$ 5,400,000		$ 5,600,000
Amount of loan reduction due to net accretable purchase accounting adjustments	28,200,000		$ 13,900,000
Gross interest income that would have been recorded if impaired loans had been current	$ 700,000	$ 400,000
Loans newly classified as troubled debt restructurings (“TDR”)		$ 0
TDRs subsequently classified as non-performing and had payment defaults	0	0
Minimum days past due for TDR loans to be classified as non-performing	90 days
Balance of all acquired loans	$ 2,000,000,000
Retail real estate
Portfolio Loans
Loans in the process of foreclosure	3,400,000
Maximum \| Commercial real estate
Portfolio Loans
Limit where loans are processed through an expedited underwriting process	1,000,000
Pass and watch \| Commercial
Portfolio Loans
Limit where loans are processed through an expedited underwriting process	350,000
Pass and watch \| Minimum \| Commercial
Portfolio Loans
Limit where loans are processed through an expedited underwriting process	350,000
Pass and watch \| Maximum \| Commercial
Portfolio Loans
Limit where loans are processed through an expedited underwriting process	1,000,000
Watch \| Commercial
Portfolio Loans
Limit above which loans are annually reviewed	1,000,000
Special Mention
Portfolio Loans
Limit above which loans are annually reviewed	350,000
In compliance with modified terms
Portfolio Loans
Loans newly classified as troubled debt restructurings (“TDR”)	$ 3,100,000
In compliance with modified terms \| Commercial
Portfolio Loans
Performing loans classified as TDRs \| loan		1

Portfolio loans - Risk Grades (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Pass
Loans
Portfolio loans receivable	$ 5,850,714	$ 4,976,708
Watch
Loans
Portfolio loans receivable	383,313	330,650
Special Mention
Loans
Portfolio loans receivable	158,764	142,839
Substandard
Loans
Portfolio loans receivable	84,150	86,060
Substandard Non-accrual
Loans
Portfolio loans receivable	36,230	34,997
Commercial \| Pass
Loans
Portfolio loans receivable	1,359,640	1,126,257
Commercial \| Watch
Loans
Portfolio loans receivable	180,954	172,449
Commercial \| Special Mention
Loans
Portfolio loans receivable	59,595	47,000
Commercial \| Substandard
Loans
Portfolio loans receivable	41,525	42,532
Commercial \| Substandard Non-accrual
Loans
Portfolio loans receivable	16,243	17,953
Commercial real estate \| Pass
Loans
Portfolio loans receivable	2,406,213	2,106,711
Commercial real estate \| Watch
Loans
Portfolio loans receivable	168,415	137,214
Commercial real estate \| Special Mention
Loans
Portfolio loans receivable	89,262	85,148
Commercial real estate \| Substandard
Loans
Portfolio loans receivable	33,585	36,205
Commercial real estate \| Substandard Non-accrual
Loans
Portfolio loans receivable	9,761	10,298
Real estate construction \| Pass
Loans
Portfolio loans receivable	362,541	268,069
Real estate construction \| Watch
Loans
Portfolio loans receivable	19,652	14,562
Real estate construction \| Special Mention
Loans
Portfolio loans receivable	3,105	3,899
Real estate construction \| Substandard
Loans
Portfolio loans receivable	1,346	1,888
Real estate construction \| Substandard Non-accrual
Loans
Portfolio loans receivable	1,126	18
Retail real estate \| Pass
Loans
Portfolio loans receivable	1,671,219	1,448,964
Retail real estate \| Watch
Loans
Portfolio loans receivable	14,202	6,425
Retail real estate \| Special Mention
Loans
Portfolio loans receivable	6,802	6,792
Retail real estate \| Substandard
Loans
Portfolio loans receivable	7,678	5,435
Retail real estate \| Substandard Non-accrual
Loans
Portfolio loans receivable	9,080	6,698
Retail other \| Pass
Loans
Portfolio loans receivable	51,101	26,707
Retail other \| Watch
Loans
Portfolio loans receivable	90
Retail other \| Substandard
Loans
Portfolio loans receivable	16
Retail other \| Substandard Non-accrual
Loans
Portfolio loans receivable	$ 20	$ 30

Portfolio loans - Past Due and Still Accruing or on a Non-accrual Status Loans (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Loans past due
Loans past due, still accruing		$ 1,601
90+Days	$ 356
Non-accrual Loans	36,230	34,997
30 to 59 Days
Loans past due
Loans past due, still accruing	7,069	5,053
60 to 89 Days
Loans past due
Loans past due, still accruing	3,711	2,068
Commercial
Loans past due
Loans past due, still accruing		775
90+Days	72
Non-accrual Loans	16,243	17,953
Commercial \| 30 to 59 Days
Loans past due
Loans past due, still accruing	410	158
Commercial \| 60 to 89 Days
Loans past due
Loans past due, still accruing	1,500	140
Commercial real estate
Loans past due
Non-accrual Loans	9,761	10,298
Commercial real estate \| 30 to 59 Days
Loans past due
Loans past due, still accruing	1,662	148
Commercial real estate \| 60 to 89 Days
Loans past due
Loans past due, still accruing	595	558
Real estate construction
Loans past due
Loans past due, still accruing		58
Non-accrual Loans	1,126	18
Real estate construction \| 30 to 59 Days
Loans past due
Loans past due, still accruing	191	121
Retail real estate
Loans past due
Loans past due, still accruing		766
90+Days	284
Non-accrual Loans	9,080	6,698
Retail real estate \| 30 to 59 Days
Loans past due
Loans past due, still accruing	4,442	4,578
Retail real estate \| 60 to 89 Days
Loans past due
Loans past due, still accruing	1,596	1,368
Retail other
Loans past due
Loans past due, still accruing		2
Non-accrual Loans	20	30
Retail other \| 30 to 59 Days
Loans past due
Loans past due, still accruing	364	48
Retail other \| 60 to 89 Days
Loans past due
Loans past due, still accruing	$ 20	$ 2

Portfolio loans - Summary of Restructured Loans (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Restructured loans
Total loans	$ 11,671	$ 8,838
In compliance with modified terms
Restructured loans
Total loans	11,127	8,319
30-89 days past due
Restructured loans
Total loans	184	127
Included in non-performing loans
Restructured loans
Total loans	$ 360	$ 392

Portfolio loans - Loans Identified as Impaired, Segregated by Category (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Loans identified as impaired
Unpaid Contractual Principal Balance	$ 57,454	$ 55,534
Recorded Investment with No Allowance	35,078	33,622
Recorded Investment with Allowance	15,400	16,560
Total Recorded Investment	50,478	50,182
Related Allowance	5,399	5,561
Average Recorded Investment	48,031	46,303
Commercial
Loans identified as impaired
Unpaid Contractual Principal Balance	19,507	21,442
Recorded Investment with No Allowance	5,605	6,858
Recorded Investment with Allowance	10,787	12,001
Total Recorded Investment	16,392	18,859
Related Allowance	4,126	4,319
Average Recorded Investment	15,165	13,364
Commercial real estate
Loans identified as impaired
Unpaid Contractual Principal Balance	20,174	19,079
Recorded Investment with No Allowance	13,818	13,082
Recorded Investment with Allowance	4,498	4,498
Total Recorded Investment	18,316	17,580
Related Allowance	1,231	1,181
Average Recorded Investment	18,448	18,077
Real estate construction
Loans identified as impaired
Unpaid Contractual Principal Balance	930	478
Recorded Investment with No Allowance	820	453
Total Recorded Investment	820	453
Average Recorded Investment	586	712
Retail real estate
Loans identified as impaired
Unpaid Contractual Principal Balance	16,795	14,418
Recorded Investment with No Allowance	14,815	13,196
Recorded Investment with Allowance	115	61
Total Recorded Investment	14,930	13,257
Related Allowance	42	61
Average Recorded Investment	13,792	14,110
Retail other
Loans identified as impaired
Unpaid Contractual Principal Balance	48	117
Recorded Investment with No Allowance	20	33
Total Recorded Investment	20	33
Average Recorded Investment	$ 40	$ 40

Portfolio loans - Allowance for Loan Loss (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Mar. 31, 2019	Dec. 31, 2018
Changes in allowance for loan losses
Beginning balance	$ 50,648	$ 53,582
Provision for loan loss	2,111	1,008
Charged-off	(2,469)	(2,930)
Recoveries	625	989
Ending balance	50,915	52,649
Allowance for loan losses Ending balance attributed to:
Loans individually evaluated for impairment			$ 5,399	$ 5,561
Loans collectively evaluated for impairment			45,516	45,087
Ending balance	50,648	53,582	50,915	50,648
Allowance for loan losses and recorded investments in portfolio loans by category
Loans individually evaluated for impairment			45,795	47,404
Loans collectively evaluated for impairment			6,464,603	5,518,246
PCI loans evaluated for impairment			4,683	2,778
Ending balance			6,515,081	5,568,428
Commercial
Changes in allowance for loan losses
Beginning balance	17,829	14,779
Provision for loan loss	1,793	3,003
Charged-off	(1,807)	(781)
Recoveries	183	576
Ending balance	17,998	17,577
Allowance for loan losses Ending balance attributed to:
Loans individually evaluated for impairment			4,126	4,319
Loans collectively evaluated for impairment			13,872	13,510
Ending balance	17,829	14,779	17,998	17,829
Allowance for loan losses and recorded investments in portfolio loans by category
Loans individually evaluated for impairment			16,361	18,441
Loans collectively evaluated for impairment			1,640,630	1,386,247
PCI loans evaluated for impairment			31	418
Ending balance			1,657,022	1,405,106
Commercial real estate
Changes in allowance for loan losses
Beginning balance	21,137	21,813
Provision for loan loss	(1,089)	1,536
Charged-off	(15)	(1,315)
Recoveries	64	56
Ending balance	20,097	22,090
Allowance for loan losses Ending balance attributed to:
Loans individually evaluated for impairment			1,231	1,181
Loans collectively evaluated for impairment			18,866	19,956
Ending balance	21,137	21,813	20,097	21,137
Allowance for loan losses and recorded investments in portfolio loans by category
Loans individually evaluated for impairment			15,733	15,318
Loans collectively evaluated for impairment			2,679,200	2,349,243
PCI loans evaluated for impairment			4,558	2,262
Ending balance			2,699,491	2,366,823
Real estate construction
Changes in allowance for loan losses
Beginning balance	2,723	2,861
Provision for loan loss	2	2
Charged-off		(97)
Recoveries	82	33
Ending balance	2,807	2,799
Allowance for loan losses Ending balance attributed to:
Loans collectively evaluated for impairment			2,807	2,723
Ending balance	2,723	2,861	2,807	2,723
Allowance for loan losses and recorded investments in portfolio loans by category
Loans individually evaluated for impairment			385	453
Loans collectively evaluated for impairment			387,238	287,744
Ending balance			387,623	288,197
Retail real estate
Changes in allowance for loan losses
Beginning balance	8,471	13,783
Provision for loan loss	1,357	(3,662)
Charged-off	(517)	(530)
Recoveries	192	245
Ending balance	9,503	9,836
Allowance for loan losses Ending balance attributed to:
Loans individually evaluated for impairment			42	61
Loans collectively evaluated for impairment			9,461	8,410
Ending balance	8,471	13,783	9,503	8,471
Allowance for loan losses and recorded investments in portfolio loans by category
Loans individually evaluated for impairment			13,296	13,159
Loans collectively evaluated for impairment			1,705,025	1,466,876
PCI loans evaluated for impairment			94	98
Ending balance			1,718,415	1,480,133
Retail other
Changes in allowance for loan losses
Beginning balance	488	346
Provision for loan loss	48	129
Charged-off	(130)	(207)
Recoveries	104	79
Ending balance	510	347
Allowance for loan losses Ending balance attributed to:
Loans collectively evaluated for impairment			510	488
Ending balance	$ 488	$ 346	510	488
Allowance for loan losses and recorded investments in portfolio loans by category
Loans individually evaluated for impairment			20	33
Loans collectively evaluated for impairment			52,510	28,136
Ending balance			$ 52,530	$ 28,169

Deposits (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Deposits
Demand deposits, noninterest-bearing	$ 1,791,339	$ 1,464,700
Interest-bearing transaction deposits	1,812,146	1,435,574
Saving deposits and money market deposits	2,402,663	1,852,044
Time deposits	1,757,078	1,497,003
Total deposits	7,763,226	6,249,321
Reciprocal brokered transaction deposits included in savings deposits and money market funds	20,000	17,500
Time deposits minimum denomination of $100,000 or more	886,200	673,700
Time deposits minimum denomination of $250,000 or more	348,500	264,100
Brokered deposits included in the balance of time deposits	121,900	262,500
Deposits
April 1, 2019 – March 31, 2020	1,094,836
April 1, 2020 – March 31, 2021	361,266
April 1, 2021 – March 31, 2022	140,316
April 1, 2022 – March 31, 2023	86,067
April 1, 2023 – March 31, 2024	73,720
Thereafter	873
Time Deposits	$ 1,757,078	$ 1,497,003

Borrowings - Maturity period (Details)	3 Months Ended
Borrowings - Maturity period (Details)	Mar. 31, 2019
Maturity period
Maximum maturity period of short-term debt	1 year

Borrowings - Short-term Borrowings (Details) - Line of Credit - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2019	Jan. 29, 2019
Revolving loan facility
Borrowings
Maximum borrowing capacity		$ 20.0
Term Loan
Borrowings
Maximum borrowing capacity		$ 60.0
Outstanding amounts	$ 58.5
Short-term outstanding balance for the period ending	6.0
Long-term outstanding balance for the period ending	$ 52.5
Interest rate (as a percent)		1.50%

- Definition

The carrying value as of the balance sheet date of the current and noncurrent portions of long-term obligations drawn from a line of credit, which is a bank's commitment to make loans up to a specific amount. Examples of items that might be included in the application of this element may consist of letters of credit, standby letters of credit, and revolving credit arrangements, under which borrowings can be made up to a maximum amount as of any point in time conditional on satisfaction of specified terms before, as of and after the date of drawdowns on the line. Includes short-term obligations that would normally be classified as current liabilities but for which (a) postbalance sheet date issuance of a long term obligation to refinance the short term obligation on a long term basis, or (b) the enterprise has entered into a financing agreement that clearly permits the enterprise to refinance the short-term obligation on a long term basis and the following conditions are met (1) the agreement does not expire within 1 year and is not cancelable by the lender except for violation of an objectively determinable provision, (2) no violation exists at the BS date, and (3) the lender has entered into the financing agreement is expected to be financially capable of honoring the agreement.

+ References + Details

Borrowings - Long-term Debt (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Long-term debt
Notes payable, FHLB, ranging in original maturity from nineteen months to ten years, collateralized by FHLB deposits, residential and commercial real estate loans and FHLB stock.	$ 36,976	$ 50,000
Notes Payable	52,500
Total long-term borrowings	$ 89,476	$ 50,000
FHLB advances
Long-term debt
Weighted average rate (as a percent)	2.36%	2.28%
FHLB advances \| Minimum
Long-term debt
Interest rate (as a percent)	1.64%	2.20%
FHLB advances \| Maximum
Long-term debt
Interest rate (as a percent)	3.04%	2.41%

Borrowings - Senior notes and Subordinate Notes (Details) - USD ($) $ in Millions	May 25, 2017	Mar. 31, 2019	Dec. 31, 2018
Long-term debt
Unamortized debt issuance cost		$ 5.4	$ 5.6
Senior notes
Long-term debt
Issuance of debt	$ 40.0
Interest rate (as a percent)	3.75%
Unamortized debt issuance cost		0.4	0.5
Subordinated debt
Long-term debt
Issuance of debt	$ 60.0
Interest rate (as a percent)	4.75%
Term of debt instrument	5 years
Unamortized debt issuance cost		$ 0.8	$ 0.9
Three-month LIBOR \| Subordinated debt
Long-term debt
Floating interest rate margin (as a percent)	2.919%

Junior Subordinated Debt Owed to Unconsolidated Trusts (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Junior subordinated debt owed to unconsolidated trusts
Junior subordinated debt owed to unconsolidated trusts	$ 71,192	$ 71,155
Trust Preferred Securities
Junior subordinated debt owed to unconsolidated trusts
Percentage limit on inclusion of qualifying trust preferred securities in Tier I Capital	25.00%
Trust preferred securities qualified as Tier I capital (as a percent)	100.00%
Maximum of holding companies assets retained	$ 15,000,000
Junior Subordinated Notes \| Trust Preferred Securities
Junior subordinated debt owed to unconsolidated trusts
Maximum period to defer payment of interest on the notes and, therefore, distributions on the trust preferred securities	5 years
Parent
Junior subordinated debt owed to unconsolidated trusts
Junior subordinated debt owed to unconsolidated trusts	$ 71,200	$ 71,200

Earnings Per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Net income per share calculations for basic and diluted methods
Net income available to common stockholders	$ 25,469	$ 21,917
Shares:
Weighted average common shares outstanding	53,277,000	48,775,000
Dilutive effect of outstanding options, warrants and restricted stock units as determined by the application of the treasury stock method (in shares)	301,000	404,000
Weighted average common shares outstanding, as adjusted for diluted earnings per share calculation	53,578,000	49,179,000
Basic earnings per common share (in dollars per share)	$ 0.48	$ 0.45
Diluted earnings per common share (in dollars per share)	$ 0.48	$ 0.45
Stock options
Anti-dilutive securities excluded from the calculation of common stock equivalents
Number of anti-dilutive securities (in shares)	49,646
RSU
Anti-dilutive securities excluded from the calculation of common stock equivalents
Number of anti-dilutive securities (in shares)	172,571
Warrants
Anti-dilutive securities excluded from the calculation of common stock equivalents
Number of anti-dilutive securities (in shares)	191,278	191,278

Share-based Compensation (Details) - shares	3 Months Ended
Share-based Compensation (Details) - shares	Mar. 31, 2019	Dec. 31, 2018
Share-based Compensation
Number of shares held in treasury	286,106	310,745
RSU
Share-based Compensation
Number of shares of common stock per award	1
Minimum \| RSU
Share-based Compensation
Requisite service periods	1 year
Maximum \| RSU
Share-based Compensation
Requisite service periods	5 years
Board of directors and advisory directors \| DSUs
Share-based Compensation
Number of shares of common stock per award	1
Settlement period	30 days

Share-based Compensation - Award Status (Details) - Stock option awards	3 Months Ended
	Mar. 31, 2019 $ / shares shares
Shares
Outstanding at beginning of year (in shares) \| shares	87,600
Exercised (in shares) \| shares	(8,712)
Forfeited (in shares) \| shares	(1,319)
Expired (in shares) \| shares	(176)
Outstanding at end of year (in shares) \| shares	77,393
Exercisable at end of year (in shares) \| shares	61,146
Weighted-Average Exercise Price
Outstanding at beginning of year (in dollars per share) \| $ / shares	$ 20.58
Exercised (in dollars per share) \| $ / shares	12.93
Forfeited (in dollars per share) \| $ / shares	23.53
Expired (in dollars per share) \| $ / shares	21.03
Outstanding at end of year (in dollars per share) \| $ / shares	21.39
Exercisable at end of year (in dollars per share) \| $ / shares	$ 20.82
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Remaining Contractual Term	4 years 6 months
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term	5 years 1 month 28 days

Share-based Compensation - Restricted and Deferred Stock Units (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Additional disclosures
Stock Issued During Period Shares Equity Instruments Other than Options Vested and Related Tax Benefit	9,070
RSU
Shares
Non-vested at beginning of year (in shares)	690,495
Dividend equivalents earned (in shares)	5,729
Non-vested at end of year (in shares)	696,224
Outstanding at end of year (in shares)	696,224
Weighted-Average Grant Date Fair Value
Non-vested at beginning of year (in dollars per share)	$ 26.14
Dividend equivalents earned (in dollars per share)	25.31
Non-vested at end of year (in dollars per share)	26.13
Outstanding at end of year (in dollars per share)	$ 26.13
DSUs
Shares
Non-vested at beginning of year (in shares)	20,449
Dividend equivalents earned (in shares)	157
Vested (in shares)	(1,512)
Forfeited (in shares)	(1,523)
Non-vested at end of year (in shares)	17,571
Outstanding at end of year (in shares)	76,750
Weighted-Average Grant Date Fair Value
Non-vested at beginning of year (in dollars per share)	$ 27.93
Dividend equivalents earned (in dollars per share)	25.31
Vested (in dollars per share)	31.67
Forfeited (in dollars per share)	31.62
Non-vested at end of year (in dollars per share)	27.26
Outstanding at end of year (in dollars per share)	$ 27.57
RSUs and DSUs
Additional disclosures
Compensation expense recognized	$ 1.0	$ 0.8
Amount of compensation cost to be recognized	$ 9.9
Period over which cost will be recognized	3 years 6 months
Employee stock purchase plan
Additional disclosures
Remaining shares available for issuance	59,329
Stock option awards
Additional disclosures
Compensation expense recognized		$ 0.1
Unrecognized stock option expense	$ 0.1
First Community 2016 Equity Incentive Plan
Additional disclosures
Remaining shares available for issuance	308,617
2010 Equity Incentive Plan
Additional disclosures
Remaining shares available for issuance	731,118

Outstanding Commitments and Contingent Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Commitments to extend credit
Credit Commitments and Contingencies
Financial instruments whose contract amounts represent credit risk	$ 1,600,624	$ 1,398,483
Standby letters of credit
Credit Commitments and Contingencies
Financial instruments whose contract amounts represent credit risk	$ 35,334	$ 32,156

Regulatory Capital (Details) - USD ($) $ in Thousands	Oct. 12, 2018	Mar. 31, 2019	Dec. 31, 2018
Total Capital (to Risk Weighted Assets), Amount
Actual, Amount		$ 1,009,053	$ 894,572
Minimum Capital Requirement, Amount		578,555	482,638
Minimum To Be Well Capitalized, Amount		$ 723,194	$ 603,297
Total Capital (to Risk Weighted Assets), Ratio
Actual, Ratio (as a percent)		13.95%	14.83%
Minimum Capital Requirement, Ratio (as a percent)		8.00%	8.00%
Minimum To Be Well Capitalized, Ratio (as a percent)		10.00%	10.00%
Tier 1 Capital (to Risk Weighted Assets), Amount
Actual, Amount		$ 898,138	$ 783,924
Minimum Capital Requirement, Amount		433,917	361,978
Minimum To Be Well Capitalized, Amount		$ 578,555	$ 482,638
Tier 1 Capital (to Risk Weighted Assets), Ratio
Actual, Ratio (as a percent)		12.42%	12.99%
Minimum Capital Requirement, Ratio (as a percent)		6.00%	6.00%
Minimum To Be Well Capitalized, Ratio (as a percent)		8.00%	8.00%
Common Equity Tier 1 Capital (to Risk Weighted Assets), Amount
Actual, Amount		$ 824,138	$ 709,924
Minimum Capital Requirement, Amount		325,438	271,484
Minimum To Be Well Capitalized, Amount		$ 470,076	$ 392,143
Common Equity Tier 1 Capital (to Risk Weighted Assets), Ratio
Actual, Ratio (as a percent)		11.40%	11.77%
Minimum Capital Requirement, Ratio (as a percent)		4.50%	4.50%
Minimum To Be Well Capitalized, Ratio (as a percent)		6.50%	6.50%
Tier 1 Capital (to Average Assets), Amount
Actual, Amount		$ 898,138	$ 783,924
Minimum Capital Requirement, Amount		$ 340,417	$ 302,704
Tier 1 Capital (to Average Assets), Ratio
Actual, Ratio (as a percent)		10.55%	10.36%
Minimum Capital Requirement, Ratio (as a percent)		4.00%	4.00%
Busey Bank
Total Capital (to Risk Weighted Assets), Amount
Actual, Amount		$ 882,181	$ 854,351
Minimum Capital Requirement, Amount		487,119	481,701
Minimum To Be Well Capitalized, Amount		$ 608,899	$ 602,126
Total Capital (to Risk Weighted Assets), Ratio
Actual, Ratio (as a percent)		14.49%	14.19%
Minimum Capital Requirement, Ratio (as a percent)		8.00%	8.00%
Minimum To Be Well Capitalized, Ratio (as a percent)		10.00%	10.00%
Tier 1 Capital (to Risk Weighted Assets), Amount
Actual, Amount		$ 831,371	$ 803,703
Minimum Capital Requirement, Amount		365,340	361,276
Minimum To Be Well Capitalized, Amount		$ 487,119	$ 481,701
Tier 1 Capital (to Risk Weighted Assets), Ratio
Actual, Ratio (as a percent)		13.65%	13.35%
Minimum Capital Requirement, Ratio (as a percent)		6.00%	6.00%
Minimum To Be Well Capitalized, Ratio (as a percent)		8.00%	8.00%
Common Equity Tier 1 Capital (to Risk Weighted Assets), Amount
Actual, Amount		$ 831,371	$ 803,703
Minimum Capital Requirement, Amount		274,005	270,957
Minimum To Be Well Capitalized, Amount		$ 395,785	$ 391,382
Common Equity Tier 1 Capital (to Risk Weighted Assets), Ratio
Actual, Ratio (as a percent)		13.65%	13.35%
Minimum Capital Requirement, Ratio (as a percent)		4.50%	4.50%
Minimum To Be Well Capitalized, Ratio (as a percent)		6.50%	6.50%
Tier 1 Capital (to Average Assets), Amount
Actual, Amount		$ 831,371	$ 803,703
Minimum Capital Requirement, Amount		295,723	302,232
Minimum To Be Well Capitalized, Amount		$ 369,654	$ 377,789
Tier 1 Capital (to Average Assets), Ratio
Actual, Ratio (as a percent)		11.25%	10.64%
Minimum Capital Requirement, Ratio (as a percent)		4.00%	4.00%
Minimum To Be Well Capitalized, Ratio (as a percent)		5.00%	5.00%
Banc Ed
Total Capital (to Risk Weighted Assets), Amount
Actual, Amount		$ 190,105
Minimum Capital Requirement, Amount		90,646
Minimum To Be Well Capitalized, Amount		$ 113,308
Total Capital (to Risk Weighted Assets), Ratio
Actual, Ratio (as a percent)		16.78%
Minimum Capital Requirement, Ratio (as a percent)		8.00%
Minimum To Be Well Capitalized, Ratio (as a percent)		10.00%
Tier 1 Capital (to Risk Weighted Assets), Amount
Actual, Amount		$ 190,000
Minimum Capital Requirement, Amount		67,985
Minimum To Be Well Capitalized, Amount		$ 90,646
Tier 1 Capital (to Risk Weighted Assets), Ratio
Actual, Ratio (as a percent)		16.77%
Minimum Capital Requirement, Ratio (as a percent)		6.00%
Minimum To Be Well Capitalized, Ratio (as a percent)		8.00%
Common Equity Tier 1 Capital (to Risk Weighted Assets), Amount
Actual, Amount		$ 190,000
Minimum Capital Requirement, Amount		50,989
Minimum To Be Well Capitalized, Amount		$ 73,650
Common Equity Tier 1 Capital (to Risk Weighted Assets), Ratio
Actual, Ratio (as a percent)		16.77%
Minimum Capital Requirement, Ratio (as a percent)		4.50%
Minimum To Be Well Capitalized, Ratio (as a percent)		6.50%
Tier 1 Capital (to Average Assets), Amount
Actual, Amount		$ 190,000
Minimum Capital Requirement, Amount		68,472
Minimum To Be Well Capitalized, Amount		$ 85,589
Tier 1 Capital (to Average Assets), Ratio
Actual, Ratio (as a percent)		11.10%
Minimum Capital Requirement, Ratio (as a percent)		4.00%
Minimum To Be Well Capitalized, Ratio (as a percent)		5.00%
Busey Bank
Regulatory Capital
Distribution received through chartered amendment	$ 40,000

Operating Segments and Related Information (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2019 USD ($) segment	Mar. 31, 2018 USD ($)	Dec. 31, 2018 USD ($)
Operating Segments and Related Information
Number of reportable segments \| segment	3
Number of operating segments \| segment	3
Goodwill	$ 314,343		$ 267,685
Total Assets	9,537,334		7,702,357
Net interest income	68,383	$ 59,757
Non-interest income:	25,945	22,486
Non-interest expense:	57,163	51,040
Income before income taxes	35,054	30,195
Net income:	25,469	21,917
Operating segments \| Banking
Operating Segments and Related Information
Goodwill	293,657		246,999
Total Assets	9,499,513		7,656,709
Net interest income	70,638	61,416
Non-interest income:	12,783	10,897
Non-interest expense:	45,171	41,386
Income before income taxes	36,139	29,919
Net income:	26,665	21,845
Operating segments \| Remittance Processing
Operating Segments and Related Information
Goodwill	8,992		8,992
Total Assets	41,467		39,278
Net interest income	18	16
Non-interest income:	4,181	3,783
Non-interest expense:	2,764	2,466
Income before income taxes	1,435	1,333
Net income:	1,025	953
Operating segments \| Wealth Management
Operating Segments and Related Information
Goodwill	11,694		11,694
Total Assets	22,894		20,992
Net interest income		94
Non-interest income:	9,133	8,641
Non-interest expense:	5,564	4,911
Income before income taxes	3,569	3,824
Net income:	2,641	2,764
Other
Operating Segments and Related Information
Total Assets	(26,540)		$ (14,622)
Net interest income	(2,273)	(1,769)
Non-interest income:	(152)	(835)
Non-interest expense:	3,664	2,277
Income before income taxes	(6,089)	(4,881)
Net income:	$ (4,862)	$ (3,645)

Derivative Financial Instruments (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Interest Rate Lock Commitments
Derivative Financial Instruments
Aggregate notional amount	$ 53,800		$ 27,200
Forward Sales Commitments
Derivative Financial Instruments
Aggregate notional amount	69,200		48,600
Interest rate lock commitments and forward sales commitments
Gross gains and losses on derivative assets and liabilities recorded in Consolidated Statements of Income
Net gains (losses)	(40)	$ (322)
Interest rate lock commitments and forward sales commitments \| Non-interest income
Gross gains and losses on derivative assets and liabilities recorded in Consolidated Statements of Income
Gross gains	1,078	732
Interest rate lock commitments and forward sales commitments \| Non-interest expense
Gross gains and losses on derivative assets and liabilities recorded in Consolidated Statements of Income
Gross (losses)	(1,118)	(1,054)
Interest rate lock commitments and forward sales commitments \| Other assets
Fair values of derivative assets and liabilities recorded in consolidated balance sheets
Fair value recorded in other assets	835		624
Interest rate lock commitments and forward sales commitments \| Other liabilities
Fair values of derivative assets and liabilities recorded in consolidated balance sheets
Fair value recorded in other liabilities	1,118		1,205
Interest rate swap
Derivative Financial Instruments
Aggregate notional amount	334,700		243,700
Variable rate, commercial loans that are supported by the interest rate swap contracts	167,400		121,800
Derivative cash pledged			1,000
Derivative securities pledged	5,700
Gross gains and losses on derivative assets and liabilities recorded in Consolidated Statements of Income
Net gains (losses)
Interest rate swap \| Non-interest income
Gross gains and losses on derivative assets and liabilities recorded in Consolidated Statements of Income
Gross gains	3,713	954
Interest rate swap \| Non-interest expense
Gross gains and losses on derivative assets and liabilities recorded in Consolidated Statements of Income
Gross (losses)	(3,713)	$ (954)
Interest rate swap \| Other assets
Fair values of derivative assets and liabilities recorded in consolidated balance sheets
Fair value recorded in other assets	5,151		1,438
Interest rate swap \| Other liabilities
Fair values of derivative assets and liabilities recorded in consolidated balance sheets
Fair value recorded in other liabilities	$ 5,151		$ 1,438

Fair Value Measurements - General Disclosures (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Financial assets and financial liabilities measured at fair value
Transfers between levels of fair value hierarchy	$ 0
Securities available for sale	1,918,295	$ 697,685
Securities equity investments	6,378	6,169
Loans held for sale	20,291	25,895
U.S. Treasury securities
Financial assets and financial liabilities measured at fair value
Securities available for sale	64,309	25,411
Obligations of U.S. government corporations and agencies
Financial assets and financial liabilities measured at fair value
Securities available for sale	325,420	52,342
Obligations of states and political subdivisions
Financial assets and financial liabilities measured at fair value
Securities available for sale	283,478	170,044
Commercial mortgage-backed securities
Financial assets and financial liabilities measured at fair value
Securities available for sale	55,562	1,942
Residential mortgage-backed securities
Financial assets and financial liabilities measured at fair value
Securities available for sale	1,049,761	315,748
Corporate debt securities
Financial assets and financial liabilities measured at fair value
Securities available for sale	139,765	132,198
Recurring basis
Financial assets and financial liabilities measured at fair value
Securities equity investments	6,378	6,169
Loans held for sale	20,291	25,895
Recurring basis \| Derivative assets
Financial assets and financial liabilities measured at fair value
Fair value recorded in other assets	5,986	2,062
Recurring basis \| Derivative liabilities
Financial assets and financial liabilities measured at fair value
Fair value recorded in other liabilities	6,269	2,643
Recurring basis \| U.S. Treasury securities
Financial assets and financial liabilities measured at fair value
Securities available for sale	64,309	25,411
Recurring basis \| Obligations of U.S. government corporations and agencies
Financial assets and financial liabilities measured at fair value
Securities available for sale	325,420	52,342
Recurring basis \| Obligations of states and political subdivisions
Financial assets and financial liabilities measured at fair value
Securities available for sale	283,478	170,044
Recurring basis \| Commercial mortgage-backed securities
Financial assets and financial liabilities measured at fair value
Securities available for sale	55,562	1,942
Recurring basis \| Residential mortgage-backed securities
Financial assets and financial liabilities measured at fair value
Securities available for sale	1,049,761	315,748
Recurring basis \| Corporate debt securities
Financial assets and financial liabilities measured at fair value
Securities available for sale	139,765	132,198
Recurring basis \| Level 1
Financial assets and financial liabilities measured at fair value
Securities equity investments	6,378	6,169
Recurring basis \| Level 2
Financial assets and financial liabilities measured at fair value
Loans held for sale	20,291	25,895
Recurring basis \| Level 2 \| Derivative assets
Financial assets and financial liabilities measured at fair value
Fair value recorded in other assets	5,986	2,062
Recurring basis \| Level 2 \| Derivative liabilities
Financial assets and financial liabilities measured at fair value
Fair value recorded in other liabilities	6,269	2,643
Recurring basis \| Level 2 \| U.S. Treasury securities
Financial assets and financial liabilities measured at fair value
Securities available for sale	64,309	25,411
Recurring basis \| Level 2 \| Obligations of U.S. government corporations and agencies
Financial assets and financial liabilities measured at fair value
Securities available for sale	325,420	52,342
Recurring basis \| Level 2 \| Obligations of states and political subdivisions
Financial assets and financial liabilities measured at fair value
Securities available for sale	283,478	170,044
Recurring basis \| Level 2 \| Commercial mortgage-backed securities
Financial assets and financial liabilities measured at fair value
Securities available for sale	55,562	1,942
Recurring basis \| Level 2 \| Residential mortgage-backed securities
Financial assets and financial liabilities measured at fair value
Securities available for sale	1,049,761	315,748
Recurring basis \| Level 2 \| Corporate debt securities
Financial assets and financial liabilities measured at fair value
Securities available for sale	$ 139,765	$ 132,198

Fair Value Measurements - Additional Quantitative Information (Details)	Mar. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Impaired loans	$ 50,478,000	$ 50,182,000
Non-recurring basis
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Impaired loans	10,001,000	10,999,000
OREO	84,000	55,000
Bank property held for sale	1,832,000	1,832,000
Non-recurring basis \| Level 3
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Impaired loans	10,001,000	10,999,000
OREO	84,000	55,000
Bank property held for sale	1,832,000	1,832,000
Non-recurring basis \| Level 3 \| Appraisal of collateral \| Impaired loans
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Impaired loans	10,001,000	10,999,000
Non-recurring basis \| Level 3 \| Appraisal of collateral \| OREO
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
OREO	84,000	55,000
Non-recurring basis \| Level 3 \| Appraisal of collateral or real estate listing price \| Bank property held for sale
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Bank property held for sale	$ 1,832,000	$ 1,832,000
Appraisal adjustments \| Non-recurring basis \| Level 3 \| Appraisal of collateral \| Impaired loans \| Minimum
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Impaired loans	(4.1)	(3.3)
Appraisal adjustments \| Non-recurring basis \| Level 3 \| Appraisal of collateral \| Impaired loans \| Maximum
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Impaired loans	(100.0)	(100.0)
Appraisal adjustments \| Non-recurring basis \| Level 3 \| Appraisal of collateral \| OREO \| Minimum
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
OREO	(25.0)	(25.0)
Appraisal adjustments \| Non-recurring basis \| Level 3 \| Appraisal of collateral \| OREO \| Maximum
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
OREO	100.0	(100.0)
Appraisal adjustments \| Non-recurring basis \| Level 3 \| Appraisal of collateral or real estate listing price \| Bank property held for sale \| Minimum
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Bank property held for sale		$ 0.0
Bank property held for sale	0.0
Appraisal adjustments \| Non-recurring basis \| Level 3 \| Appraisal of collateral or real estate listing price \| Bank property held for sale \| Maximum
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Bank property held for sale		$ (35.1)
Bank property held for sale	(35.1)

Fair Value Measurements - Segregated by Level of Valuation Inputs (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Financial assets:
Cash and cash equivalents	$ 330,407	$ 239,973
Securities held to maturity	15,975	603,360
Portfolio loans, net	6,464,166	5,517,780
Financial liabilities:
Short-term borrowings	30,739
Junior subordinated debt owed to unconsolidated trusts	71,192	71,155
Level 1 \| Carrying Amount
Financial assets:
Cash and cash equivalents	330,407	239,973
Level 1 \| Fair Value
Financial assets:
Cash and cash equivalents	330,407	239,973
Level 2 \| Carrying Amount
Financial assets:
Securities held to maturity	15,846	608,660
Accrued interest receivable	29,748	22,314
Financial liabilities:
Time deposits	1,757,078	1,497,003
Securities sold under agreements to repurchase	217,077	185,796
Short-term borrowings	30,739
Long-term debt	89,476	50,000
Junior subordinated debt owed to unconsolidated trusts	71,192	71,155
Accrued interest payable	7,589	6,568
Level 2 \| Fair Value
Financial assets:
Securities held to maturity	15,975	603,360
Accrued interest receivable	29,748	22,314
Financial liabilities:
Time deposits	1,746,252	1,482,301
Securities sold under agreements to repurchase	217,077	185,796
Short-term borrowings	30,871
Long-term debt	89,738	49,873
Junior subordinated debt owed to unconsolidated trusts	65,152	65,182
Accrued interest payable	7,589	6,568
Level 3 \| Carrying Amount
Financial assets:
Portfolio loans, net	6,464,166	5,517,780
Mortgage servicing rights	10,201	3,315
Other servicing rights	839	781
Level 3 \| Fair Value
Financial assets:
Portfolio loans, net	6,402,404	5,473,063
Mortgage servicing rights	16,194	11,051
Other servicing rights	1,413	1,443
Level 3 \| Senior notes \| Carrying Amount
Financial liabilities:
Long-term debt	39,573	39,539
Level 3 \| Senior notes \| Fair Value
Financial liabilities:
Long-term debt	39,797	39,452
Level 3 \| Subordinated debt \| Carrying Amount
Financial liabilities:
Long-term debt	59,172	59,147
Level 3 \| Subordinated debt \| Fair Value
Financial liabilities:
Long-term debt	$ 58,748	$ 58,186

Leases (Details) $ in Thousands	Mar. 31, 2019 USD ($)
Leases
Right of use asset	$ 10,898
Lease liability	$ 10,982

Leases - Lease cost and other lease information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Lease Costs
Operating lease costs	$ 533
Variable lease costs	111
Short-term lease costs	15
Net lease cost	659	$ 700
Cash paid for amounts included in the measurement of lease liabilities
Operating lease cash flows – Fixed payments	513
Operating lease cash flows – Liability reduction	$ 463
Weighted average lease term (in years)	8 years 3 months 29 days
Weighted average discount rate (in percent)	3.11%

Leases - Future rent commitments (Details) $ in Thousands	Mar. 31, 2019 USD ($)
Projected minimum rental payments under the terms of leases
2019	$ 1,628
2020	2,094
2021	1,573
2022	1,406
2023	1,249
Thereafter	4,498
Amounts representing interest	(1,466)
Present value of net future minimum lease payments	$ 10,982