Meridian Bancorp, Inc. - S-1 filing on 2014-03-10

Loans (Tables)

12 Months Ended

Dec. 31, 2013

A summary of loans follows:


	December 31,
	2013			2012
	(Dollars in thousands)
Real estate loans:
Residential real estate:
One- to four-family	$	454,148		$	443,228
Multi-family		288,172			178,948
Home equity lines of credit		54,499			60,907
Commercial real estate		1,032,408			795,642
Construction		208,799			173,255

Total real estate loans		2,038,026			1,651,980
Commercial business loans		247,005			147,814
Consumer		7,225			7,143

Total loans		2,292,256			1,806,937
Allowance for loan losses		(25,335	)		(20,504	)
Net deferred loan origination fees		(1,521	)		(94	)

Loans, net	$	2,265,400		$	1,786,339

Outstanding Balance of Acquired Loans

The following is a summary of the outstanding balance of the acquired loans with evidence of credit deterioration:


	December 31,
	2013			2012
	(In thousands)
Real estate loans:
Residential real estate:
One- to four-family	$	6,494		$	7,581
Multi-family		846			1,280
Home equity lines of credit		509			568
Commercial real estate		720			1,646

Total real estate loans		8,569			11,075
Commercial business loans		78			78
Consumer		4			4

Outstanding principal balance		8,651			11,157
Discount		(2,215	)		(2,595	)

Carrying amount	$	6,436		$	8,562

Accretable Yield

A rollforward of accretable yield follows:


	Years Ended December 31,
	2013			2012			2011
	(In thousands)
Beginning balance	$	1,047		$	1,181		$	—
Reclassification from nonaccretable discount		332			—			1,188
Accretion		(37	)		(44	)		(7	)
Disposals		(161	)		(90	)		—

Ending balance	$	1,181		$	1,047		$	1,181

Allowance for Loan Losses

An analysis of the allowance for loan losses and related information follows:


							Home
	One- to			Multi-			equity lines			Commercial						Commercial
	four-family			family			of credit			real estate			Construction			business			Consumer			Unallocated		Total
	(In thousands)
Allowance for loan losses:
Balance at December 31, 2010	$	1,130		$	1,038		$	227		$	5,238		$	2,042		$	448		$	32		$	—	$	10,155
Provision (credit) for loan losses		795			280			136			1,875			(240	)		685			132			—		3,663
Charge-offs		(192	)		—			(123	)		(150	)		(869	)		(72	)		(96	)		—		(1,502	)
Recoveries		128			43			5			17			497			—			47			—		737

Balance at December 31, 2011		1,861			1,361			245			6,980			1,430			1,061			115			—		13,053
Provision for loan losses		919			114			33			3,917			2,382			1,102			114			—		8,581
Charge-offs		(599	)		(72	)		(52	)		(719	)		(398	)		—			(164	)		—		(2,004	)
Recoveries		326			28			—			227			242			11			40			—		874

Balance at December 31, 2012		2,507			1,431			226			10,405			3,656			2,174			105			—		20,504
Provision (credit) for loan losses		(217	)		1,084			(71	)		2,426			1,525			1,523			200			—		6,470
Charge-offs		(531	)		(96	)		—			—			(1,362	)		(288	)		(283	)		—		(2,560	)
Recoveries		232			—			—			—			555			24			110			—		921

Balance at December 31, 2013	$	1,991		$	2,419		$	155		$	12,831		$	4,374		$	3,433		$	132		$	—	$	25,335

December 31, 2013
Amount of allowance for loan losses for loans deemed to be impaired	$	132		$	—		$	—		$	190		$	54		$	—		$	—		$	—	$	376
Amount of allowance for loan losses for loans not deemed to be impaired		1,859			2,419			155			12,641			4,320			3,433			132			—		24,959

	$	1,991		$	2,419		$	155		$	12,831		$	4,374		$	3,433		$	132		$	—	$	25,335

Amount of allowance for loan losses for loans acquired with deteriorated credit quality included above	$	44		$	—		$	—		$	12		$	—		$	—		$	—		$	—	$	56

Loans deemed to be impaired	$	4,089		$	4,002		$	21		$	10,820		$	13,308		$	1,232		$	—				$	33,472
Loans not deemed to be impaired		450,059			284,170			54,478			1,021,588			195,491			245,773			7,225					2,258,784

	$	454,148		$	288,172		$	54,499		$	1,032,408		$	208,799		$	247,005		$	7,225				$	2,292,256


					Home
	One- to		Multi-		equity lines		Commercial				Commercial
	four-family		family		of credit		real estate		Construction		business		Consumer		Unallocated		Total
	(In thousands)
December 31, 2012
Amount of allowance for loan losses for loans deemed to be impaired	$	128	$	90	$	—	$	204	$	227	$	—	$	—	$	—	$	649
Amount of allowance for loan losses for loans not deemed to be impaired		2,379		1,341		226		10,201		3,429		2,174		105				19,855

	$	2,507	$	1,431	$	226	$	10,405	$	3,656	$	2,174	$	105	$	—	$	20,504

Amount of allowance for loan losses for loans acquired with deteriorated credit quality included above	$	31	$	90	$	—	$	9	$	—	$	—	$	—	$	—	$	130

Loans deemed to be impaired	$	4,486	$	5,784	$	22	$	12,146	$	18,319	$	424	$	—			$	41,181
Loans not deemed to be impaired		438,742		173,164		60,885		783,496		154,936		147,390		7,143				1,765,756

	$	443,228	$	178,948	$	60,907	$	795,642	$	173,255	$	147,814	$	7,143			$	1,806,937

Past Due and Non Accrual

The following table provides information about the Company’s past due and non-accrual loans:


	30-59		60-89		90 Days
	Days		Days		or Greater		Total		Loans on
	Past Due		Past Due		Past Due		Past Due		Non-accrual
	(In thousands)
December 31, 2013
Real estate loans:
Residential real estate:
One- to four-family	$	6,203	$	1,185	$	6,714	$	14,102	$	17,622
Multi-family		75		—		85		160		—
Home equity lines of credit		2,504		178		744		3,426		2,689
Commercial real estate		314		—		2,742		3,056		8,972
Construction		497		—		11,297		11,794		11,298

Total real estate loans		9,593		1,363		21,582		32,538		40,581
Commercial business loans		284		50		852		1,186		949
Consumer		461		282		—		743		—

Total	$	10,338	$	1,695	$	22,434	$	34,467	$	41,530

December 31, 2012
Real estate loans:
Residential real estate:
One- to four-family	$	3,996	$	2,476	$	8,990	$	15,462	$	18,870
Multi-family		—		—		364		364		976
Home equity lines of credit		767		674		754		2,195		2,674
Commercial real estate		1,722		379		3,671		5,772		8,844
Construction		496		—		6,553		7,049		7,785

Total real estate loans		6,981		3,529		20,332		30,842		39,149
Commercial business loans		201		—		318		519		424
Consumer		479		132		—		611		—

Total	$	7,661	$	3,661	$	20,650	$	31,972	$	39,573

Impaired Loans of Company

The following tables provide information with respect to the Company’s impaired loans:


	December 31,
	2013						2012
			Unpaid						Unpaid
	Recorded		Principal		Related		Recorded		Principal		Related
	Investment		Balance		Allowance		Investment		Balance		Allowance
	(In thousands)
Impaired loans without a valuation allowance:
One- to four-family	$	2,399	$	2,699			$	2,157	$	2,465
Multi-family		4,002		4,002				5,419		5,893
Home equity lines of credit		21		21				22		22
Commercial real estate		9,327		10,014				9,752		10,054
Construction		12,930		15,926				16,726		17,818
Commercial business loans		1,232		1,635				424		502

Total		29,911		34,297				34,500		36,754

Impaired loans with a valuation allowance:
One- to four-family		1,690		1,806	$	132		2,329		2,330	$	128
Multi-family		—		—		—		365		482		90
Commercial real estate		1,493		1,493		190		2,394		2,394		204
Construction		378		389		54		1,593		1,787		227

Total		3,561		3,688		376		6,681		6,993		649

Total impaired loans	$	33,472	$	37,985	$	376	$	41,181	$	43,747	$	649

At December 31, 2013, additional funds of $2.9 million are committed to be advanced in connection with impaired construction loans.


	Years Ended December 31,
	2013						2012						2011
					Interest						Interest						Interest
	Average		Interest		Income		Average		Interest		Income		Average		Interest		Income
	Recorded		Income		Recognized		Recorded		Income		Recognized		Recorded		Income		Recognized
	Investment		Recognized		on Cash Basis		Investment		Recognized		on Cash Basis		Investment		Recognized		on Cash Basis
	(In thousands)
One- to four-family	$	4,627	$	219	$	192	$	4,510	$	245	$	196	$	5,285	$	344	$	288
Multi-family		5,694		300		292		8,959		752		717		4,346		428		415
Home equity lines of credit		22		1		1		23		1		1		124		8		8
Commercial real estate		13,010		654		314		14,479		857		498		12,383		959		710
Construction		16,452		1,076		359		23,027		1,428		706		26,849		2,572		1,750
Commercial business loans		958		62		32		674		54		54		690		123		115

Total impaired loans	$	40,763	$	2,312	$	1,190	$	51,672	$	3,337	$	2,172	$	49,677	$	4,434	$	3,286

Summary of Troubled Debt Restructurings at the Dates

The following table summarizes the TDRs at the dates indicated:


	December 31,
	2013		2012
	(In thousands)
TDRs on accrual status:
One- to four-family	$	2,588	$	1,992
Multi-family		109		110
Home equity lines of credit		21		22
Commercial real estate		1,368		1,393
Construction		—		3,319

Total TDRs on accrual status		4,086		6,836

TDRs on non-accrual status:
One- to four-family		1,500		2,493
Commercial real estate		4,309		4,466
Construction		9,489		3,838
Commercial business loans		192		—

Total TDRs on non-accrual status		15,490		10,797

Total TDRs	$	19,576	$	17,633

Summary of Troubled Debt Restructurings Modified During Period

The following is a summary of TDRs modified during the periods indicated:


	Years Ended December 31,
	2013						2012						2011
	Number of		Pre- Modification		Post- Modification		Number of		Pre- Modification		Post- Modification		Number of		Pre- Modification		Post- Modification
	Loans		Balance		Balance		Loans		Balance		Balance		Loans		Balance		Balance
	(Dollars In thousands)
Real estate loans:
One- to four-family		2	$	391	$	391		6	$	1,433	$	1,433		9	$	2,185	$	2,185
Multi-family		—		—		—		1		110		110		—		—		—
Commercial real estate		1		207		207		1		1,395		1,395		1		3,450		3,450
Construction		2		2,946		2,946		—		—		—		2		2,237		2,237

Total		5	$	3,544	$	3,544		8	$	2,938	$	2,938		12	$	7,872	$	7,872

Modified TDRs Loans

The following provides information on how loans were modified as TDRs during the periods indicated:


	Years Ended December 31,
	2013		2012		2011
	(In thousands)
Adjusted interest rates	$	391	$	1,433	$	5,635
Extended maturity dates		2,946		—		—
Combination of rate and maturity		207		1,505		2,237

Total	$	3,544	$	2,938	$	7,872

Summary of Defaulted TDRs

The following is a summary of TDRs that defaulted (became 90 days past due) in the first twelve months after restructure:


	Years Ended December 31,
	2013				2012				2011
	Number of		Recorded		Number of		Recorded		Number of		Recorded
	Loans		Investment		Loans		Investment		Loans		Investment
	(Dollars In thousands)
Real estate loans:
One- to four-family		—	$	—		5	$	908		3	$	812
Construction		1		207		—		—		2		6,031

Total		1	$	207		5	$	908		5	$	6,843

Risk Rating

The following tables provide information with respect to the Company’s risk rating:


	December 31,
	2013								2012
	Multi-family								Multi-family
	residential		Commercial				Commercial		residential		Commercial				Commercial
	real estate		real estate		Construction		business		real estate		real estate		Construction		business
	(In thousands)
Loans rated 1 - 3A	$	275,711	$	1,015,172	$	178,980	$	245,646	$	164,370	$	773,844	$	125,418	$	145,676
Loans rated 4 - 4A		1,665		4,315		—		4		8,455		10,216		29,551		1,582
Loans rated 5		10,796		12,921		29,819		1,355		6,123		11,582		18,286		556
Loans rated 6		—		—		—		—		—		—		—		—
Loans rated 7		—		—		—		—		—		—		—		—

Total	$	288,172	$	1,032,408	$	208,799	$	247,005	$	178,948	$	795,642	$	173,255	$	147,814