0001140361-20-024737 | 10-Q | XBRL Viewer | South Plains Financial INC

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Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2020	Nov. 06, 2020
Cover [Abstract]
Entity Registrant Name	SOUTH PLAINS FINANCIAL, INC.
Entity Central Index Key	0001163668
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Shell Company	false
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Common Stock, Shares Outstanding		18,059,174
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2020
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q3
Entity Address, State or Province	TX

CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
ASSETS
Cash and due from banks	$ 43,750	$ 56,246
Interest-bearing deposits in banks	245,785	101,853
Federal funds sold	1,350	0
Cash and cash equivalents	290,885	158,099
Securities available for sale	726,329	707,650
Loans held for sale	76,507	49,035
Loans held for investment	2,288,234	2,143,623
Allowance for loan losses	(46,076)	(24,197)
Accrued interest receivable	13,632	13,924
Premises and equipment, net	61,399	61,873
Bank-owned life insurance	70,401	69,397
Goodwill	19,508	18,757
Intangible assets	7,994	8,632
Mortgage servicing rights	6,562	2,054
Deferred tax asset, net	3,650	5,619
Other assets	23,641	22,701
Total assets	3,542,666	3,237,167
Deposits:
Noninterest-bearing	906,059	790,921
Interest-bearing	2,037,743	1,905,936
Total deposits	2,943,802	2,696,857
Short-term borrowings	7,765	37,165
Accrued expenses and other liabilities	41,592	29,098
Notes payable & other borrowings	75,000	95,000
Subordinated debt securities	75,546	26,472
Junior subordinated deferrable interest debentures	46,393	46,393
Total liabilities	3,190,098	2,930,985
Stockholders' equity:
Common stock, $1.00 par value per share, 30,000,000 shares authorized; 18,059,174 and 18,036,115 issued and outstanding at September 30, 2020 and December 31, 2019, respectively	18,059	18,036
Additional paid-in capital	141,245	140,492
Retained earnings	174,501	146,696
Accumulated other comprehensive income	18,763	958
Total stockholders' equity	352,568	306,182
Total liabilities and stockholders' equity	$ 3,542,666	$ 3,237,167

CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares	Sep. 30, 2020	Dec. 31, 2019
Stockholders' equity:
Common stock, par value (in dollars per share)	$ 1.00	$ 1.00
Common stock, shares authorized (in shares)	30,000,000	30,000,000
Common stock, shares issued (in shares)	18,059,174	18,036,115
Common stock, shares outstanding (in shares)	18,059,174	18,036,115

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Interest income:
Loans, including fees	$ 30,724	$ 29,652	$ 91,600	$ 86,342
Securities:
Taxable	2,678	2,021	9,628	6,013
Non taxable	1,061	226	2,399	669
Federal funds sold and interest-bearing deposits in banks	40	1,766	620	5,154
Total interest income	34,503	33,665	104,247	98,178
Interest expense:
Deposits	2,517	5,627	9,560	17,655
Notes payable & other borrowings	68	581	620	1,849
Subordinated debt securities	403	404	1,210	1,213
Junior subordinated deferrable interest debentures	242	485	937	1,510
Total interest expense	3,230	7,097	12,327	22,227
Net interest income	31,273	26,568	91,920	75,951
Provision for loan losses	6,062	420	25,429	1,903
Net interest income, after provision for loan losses	25,211	26,148	66,491	74,048
Noninterest income:
Service charges on deposit accounts	1,749	2,101	5,171	5,985
Income from insurance activities	3,303	1,114	5,484	4,074
Net gain on sales of loans	20,942	6,626	47,279	17,521
Bank card services and interchange fees	2,608	2,192	7,190	6,273
Realized gain on sale of securities	0	0	2,318	0
Investment commissions	441	419	1,261	1,245
Fiduciary fees	781	361	2,386	1,104
Other	1,836	1,302	4,342	3,691
Total noninterest income	31,660	14,115	75,431	39,893
Noninterest expense:
Salaries and employee benefits	23,672	18,135	66,103	56,044
Occupancy and equipment, net	3,710	3,486	10,896	10,309
Professional services	1,177	1,852	4,710	5,169
Marketing and development	615	762	2,189	2,275
IT and data services	843	722	2,769	2,104
Bank card expenses	1,095	864	3,164	2,394
Appraisal expenses	744	467	1,837	1,197
Other	4,137	3,740	13,543	10,502
Total noninterest expense	35,993	30,028	105,211	89,994
Income before income taxes	20,878	10,235	36,711	23,947
Income tax expense (benefit)	4,147	1,977	7,282	4,836
Net income	$ 16,731	$ 8,258	$ 29,429	$ 19,111
Earnings per share:
Basic (in dollars per share)	$ 0.93	$ 0.46	$ 1.63	$ 1.16
Diluted (in dollars per share)	$ 0.92	$ 0.45	$ 1.61	$ 1.15
Net income	$ 16,731	$ 8,258	$ 29,429	$ 19,111
Other comprehensive income (loss):
Change in net unrealized gain (loss) on securities available for sale	(1,418)	116	26,584	7,433
Change in net gain (loss) on cash flow hedges	430	0	(1,728)	0
Reclassification adjustment for (gain) loss included in net income	0	0	(2,318)	0
Tax effect	207	(25)	(4,733)	(1,562)
Other comprehensive income (loss)	(781)	91	17,805	5,871
Comprehensive income	$ 15,950	$ 8,349	$ 47,234	$ 24,982

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Treasury Stock [Member]	Less: ESOP Owned Shares [Member]	Total
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Cumulative change in accounting principle	$ 0	$ 0	$ (1,279)	$ 0	$ 0	$ 0	$ (1,279)
Balance at Dec. 31, 2018	$ 14,772	80,412	119,834	(2,243)	0	(58,195)	154,580
Balance (in shares) at Dec. 31, 2018	14,771,520
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock, net	$ 3,207	48,185	0	0	0	0	51,392
Issuance of common stock, net (in shares)	3,207,000
Net income	$ 0	0	19,111	0	0	0	19,111
Cash dividends, common	0	0	(539)	0	0	0	(539)
Other comprehensive income (loss), (net of tax)	0	0	0	5,871	0	0	5,871
Exercise of employee stock options and vesting of restricted stock units	$ 25	25	0	0	0	0	(161)
Exercise of employee stock options and vesting of restricted stock units (in shares)	25,803
Terminated ESOP put option	$ 0	0	0	0	0	58,195	58,195
Stock-based compensation	0	407	0	0	0	0	407
Share-based liability awards modified to equity awards	0	11,450	0	0	0	0	11,450
Balance at Sep. 30, 2019	$ 18,004	140,268	137,127	3,628	0	0	299,027
Balance (in shares) at Sep. 30, 2019	18,004,323
Balance at Jun. 30, 2019	$ 17,979	140,189	129,408	3,537	0	0	291,113
Balance (in shares) at Jun. 30, 2019	17,978,520
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock, net	$ 0	0	0	0	0	0	0
Issuance of common stock, net (in shares)	0
Net income	$ 0	0	8,258	0	0	0	8,258
Cash dividends, common	0	0	(539)	0	0	0	(539)
Other comprehensive income (loss), (net of tax)	0	0	0	91	0	0	91
Exercise of employee stock options and vesting of restricted stock units	$ 25	(186)	0	0	0	0	(161)
Exercise of employee stock options and vesting of restricted stock units (in shares)	25,803
Stock-based compensation	$ 0	265	0	0	0	0	265
Share-based liability awards modified to equity awards	0	0	0	0	0	0	0
Balance at Sep. 30, 2019	$ 18,004	140,268	137,127	3,628	0	0	299,027
Balance (in shares) at Sep. 30, 2019	18,004,323
Balance at Dec. 31, 2019	$ 18,036	140,492	146,696	958	0	0	$ 306,182
Balance (in shares) at Dec. 31, 2019	18,036,115						18,036,115
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	$ 0	0	29,429	0	0	0	$ 29,429
Cash dividends, common	0	0	(1,624)	0	0	0	(1,624)
Other comprehensive income (loss), (net of tax)	0	0	0	17,805	0	0	17,805
Exercise of employee stock options and vesting of restricted stock units	$ 28	(157)	0	0	0	0	(129)
Exercise of employee stock options and vesting of restricted stock units (in shares)	27,759
Purchase of treasury stock	$ 0	0	0	0	(61)	0	(61)
Extinguish treasury stock	(5)	(56)	0	0	61	0	$ 0
Extinguish treasury stock (in shares)							(4,700)
Stock-based compensation	0	966	0	0	0	0	$ 966
Balance at Sep. 30, 2020	$ 18,059	141,245	174,501	18,763	0	0	$ 352,568
Balance (in shares) at Sep. 30, 2020	18,059,174						18,059,174
Balance at Jun. 30, 2020	$ 18,059	140,620	158,311	19,544	0	0	$ 336,534
Balance (in shares) at Jun. 30, 2020	18,059,174
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	$ 0	0	16,731	0	0	0	16,731
Cash dividends, common	0	0	(541)	0	0	0	(541)
Other comprehensive income (loss), (net of tax)	0	0	0	(781)	0	0	(781)
Stock-based compensation	0	625	0	0	0	0	625
Balance at Sep. 30, 2020	$ 18,059	$ 141,245	$ 174,501	$ 18,763	$ 0	$ 0	$ 352,568
Balance (in shares) at Sep. 30, 2020	18,059,174						18,059,174

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited) (Parenthetical) - $ / shares	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited) [Abstract]
Cash dividends, common (in dollars per share)	$ 0.03	$ 0.03	$ 0.03	$ 0.03
Exercise of employee stock options, shares for cashless exercise (in shares)		8,570	17,178	8,570
Exercise of employee stock options, shares for taxes (in shares)		7,608	7,608	7,608

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Cash flows from operating activities:
Net income	$ 29,429	$ 19,111
Adjustments to reconcile net income to net cash from operating activities:
Provision for loan losses	25,429	1,903
Depreciation and amortization	4,935	3,733
Accretion and amortization	2,064	(97)
Other gains, net	(2,529)	(122)
Net gain on sales of loans	(47,279)	(17,521)
Proceeds from sales of loans held for sale	1,004,956	460,268
Loans originated for sale	(985,149)	(454,501)
Earnings on bank-owned life insurance	(1,004)	(937)
Stock based compensation	966	407
Net change in:
Accrued interest receivable and other assets	(8,642)	(3,390)
Accrued expenses and other liabilities	10,669	13,616
Net cash from operating activities	33,845	22,470
Activity in securities available for sale:
Purchases	(158,291)	(165,023)
Sales	94,514	0
Maturities, prepayments, and calls	69,618	109,414
Loan originations and principal collections, net	(150,579)	(7,786)
Cash paid for acquisition	(687)	(2,800)
Goodwill adjustment related to litigation settlement	460	0
Purchases of premises and equipment, net	(3,159)	(3,267)
Proceeds from sales of premises and equipment	192	208
Proceeds from sales of foreclosed assets	2,068	1,608
Net cash from investing activities	(145,864)	(67,646)
Cash flows from financing activities:
Net change in deposits	246,945	8,520
Net change in short-term borrowings	(29,400)	(7,850)
Proceeds from common stock issuance, net	0	51,392
Proceeds from subordinated debt issuance, net	49,074	0
Proceeds from notes payable & other borrowings	75,000	0
Payments to tax authorities for stock-based compensation	(129)	(161)
Payments made on notes payable and other borrowings	(95,000)	(7,530)
Cash dividends on common stock	(1,624)	(539)
Purchase of treasury stock	(61)	0
Net cash from financing activities	244,805	43,832
Net change in cash and cash equivalents	132,786	(1,344)
Beginning cash and cash equivalents	158,099	245,989
Ending cash and cash equivalents	290,885	244,645
Supplemental disclosures of cash flow information:
Interest paid on deposits and borrowed funds	12,956	21,882
Income taxes paid	8,719	4,364
Supplemental schedule of noncash investing and financing activities:
Loans transferred to foreclosed assets	1,468	1,521
Share-based liability awards modified to equity awards	$ 0	$ 11,450

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

9 Months Ended

Sep. 30, 2020

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations – South Plains Financial, Inc. (“SPFI”) is a Texas corporation and registered bank holding company that conducts its principal activities through its subsidiaries from offices located throughout Texas and Eastern New Mexico. Principal activities include commercial and retail banking, along with insurance, investment, trust, and mortgage services. The following are subsidiaries of SPFI:

Wholly Owned, Consolidated Subsidiaries:
City Bank	Bank subsidiary
Windmark Insurance Agency, Inc. (“Windmark”)	Non-bank subsidiary
Ruidoso Retail, Inc.	Non-bank subsidiary
CB Provence, LLC	Non-bank subsidiary
CBT Brushy Creek, LLC	Non-bank subsidiary
CBT Properties, LLC	Non-bank subsidiary
Wholly Owned, Equity Method Subsidiaries:
South Plains Financial Capital Trusts (SPFCT) III-V	Non-bank subsidiaries

Basis of Presentation and Consolidation – The consolidated financial statements in this Quarterly Report on Form 10-Q for the quarter ended September 30, 2020 (this “Form 10-Q”) include the accounts of SPFI and its wholly owned consolidated subsidiaries (collectively referred to as the “Company”) identified above. All significant intercompany balances and transactions have been eliminated in consolidation.

The interim consolidated financial statements in this Form 10-Q have not been audited by an independent registered public accounting firm, but in the opinion of management, reflect all adjustments necessary for a fair presentation of the Company’s financial position and results of operations. All such adjustments were of a normal and recurring nature. The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q adopted by the Securities and Exchange Commission (“SEC”). Accordingly, the financial statements do not include all of the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with the Company’s audited consolidated financial statements, and notes thereto in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. Operating results for the interim periods disclosed herein are not necessarily indicative of the results that may be expected for a full year or any future period.

Use of Estimates – The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Determination of the adequacy of the allowance for loan losses is a material estimate that is particularly susceptible to significant change in the near term; the assumptions used in stock-based compensation, the valuation of foreclosed assets, and fair values of financial instruments can also involve significant management estimates.

Change in Capital Structure – On March 11, 2019, the Company amended and restated its Certificate of Formation. The Amended and Restated Certificate of Formation increased the number of authorized shares of common stock, par value $1.00 per share, from 1,000,000 to 30,000,000.

The Company completed a 29-to-1 stock split of the Company’s outstanding shares of common stock for shareholders of record as of March 11, 2019. The stock split was payable in the form of a dividend on or about March 11, 2019. Shareholders received 29 additional shares for each share held as of the record date. All share and per share amounts in the consolidated financial statements have been retroactively adjusted to reflect this stock split for all periods presented.

Loans – Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are reported at their outstanding principal balances net of any unearned income, charge-offs, unamortized deferred fees and costs on originated loans, and premiums or discounts on purchased loans. Interest income is accrued on the unpaid principal balance. Loan origination fees, net of certain direct origination costs, are deferred and recognized as an adjustment of the related loan yield using the straight-line method, which is not materially different from the effective interest method required by GAAP.

Loans are placed on nonaccrual status when, in management’s opinion, collection of interest is unlikely, which typically occurs when principal or interest payments are more than ninety days past due. When interest accrual is discontinued, all unpaid accrued interest is reversed against interest income. The interest on these loans is accounted for on the cash-basis or cost-recovery method, until qualifying for return to accrual. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured.

Allowance for Loan Losses – The allowance for loan losses is established by management as an estimate to cover probable credit losses through a provision for loan losses charged to earnings. Loan losses are charged against the allowance when management believes the uncollectibility of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance. The Company’s allowance for loan losses consists of specific valuation allowances established for probable losses on specific loans and general valuation allowances calculated based on historical loan loss experience for similar loans with similar characteristics and trends, judgmentally adjusted for general economic conditions and other qualitative risk factors internal and external to the Company.

The allowance for loan losses is evaluated on a quarterly basis by management and is based upon management’s review of the collectability of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral, and prevailing economic conditions. This evaluation is inherently subjective, as it requires estimates that are susceptible to significant revision as more information becomes available. The determination of the adequacy of the allowance for loan losses is based on estimates that are particularly susceptible to significant changes in the economic environment and market conditions. In connection with the determination of the estimated losses on loans, management obtains independent appraisals for significant collateral. Loans originated by the bank subsidiary are generally secured by specific items of collateral including real property, crops, livestock, consumer assets, and other business assets.

While management uses available information to recognize losses on loans, further reductions in the carrying amounts of loans may be necessary based on various factors. In addition, regulatory agencies, as an integral part of their examination process, periodically review the estimated losses on loans. Such agencies may require the bank subsidiary to recognize additional losses based on their judgments about information available to them at the time of their examination. Because of these factors, it is reasonably possible that the estimated losses on loans may change materially in the near term. However, the amount of the change that is reasonably possible cannot be estimated.

A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. All loans rated substandard or worse and greater than $250,000 are specifically reviewed to determine if they are impaired. Factors considered by management in determining whether a loan is impaired include payment status and the sources, amounts, and probabilities of estimated cash flow available to service debt in relation to amounts due according to contractual terms. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed.

Loans that are determined to be impaired are then evaluated to determine estimated impairment, if any. GAAP allows impairment to be measured on a loan-by-loan basis by either the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s obtainable market price, or the fair value of the collateral if the loan is collateral dependent. Loans that are not individually determined to be impaired or are not subject to the specific review of impaired status are subject to the general valuation allowance portion of the allowance for loan loss.

The Company may modify its loan agreement with a borrower. The modification will be considered a troubled debt restructuring if the following criteria are met: (1) the borrower is experiencing a financial difficulty and (2) the Company makes a concession that it would not otherwise make. Concessions may include debt forgiveness, interest rate change, or maturity extension. Each of these loans is impaired and is evaluated for impairment, with a specific reserve recorded as necessary based on probable losses related to collateral and cash flow. A loan will no longer be required to be reported as restructured in calendar years following the restructure if the interest rate at the time of restructure is greater than or equal to the rate the Company was willing to accept for a new extension of credit with similar risk and the loan is in compliance with its modified terms.

Acquired Loans – Loans that the Company acquires in connection with business combinations are recorded at fair value with no carryover of the acquired entity’s related allowance for loan losses. The fair value of the acquired loans involves estimating the amount and timing of principal and interest cash flows expected to be collected on the loans and discounting those cash flows at a market rate of interest.

The excess of cash flows expected at acquisition over the estimated fair value is referred to as the accretable discount and is recognized into interest income over the remaining life of the loan. The difference between contractually required payments at acquisition and the cash flows expected to be collected at acquisition is referred to as the nonaccretable discount. These loans are accounted for under ASC 310-30, Loans and Debt Securities Acquired with Deteriorated Credit Quality. The nonaccretable discount includes estimated future credit losses expected to be incurred over the life of the loan. Subsequent decreases to the expected cash flows will require the Company to evaluate the need for an additional allowance. Subsequent improvement in expected cash flows will result in the reversal of a corresponding amount of the nonaccretable discount which the Company will then reclassify as accretable discount that will be recognized into interest income over the remaining life of the loan.

Loans acquired through business combinations that meet the specific criteria of ASC 310-30 are individually evaluated each period to analyze expected cash flows. To the extent that the expected cash flows of a loan have decreased due to credit deterioration, the Company then establishes an allowance.

Loans acquired through business combinations that do not meet the specific criteria of ASC 310-30 are accounted for under ASC 310-20. These loans are initially recorded at fair value, and include credit and interest rate marks associated with acquisition accounting adjustments. Purchase premiums or discounts are subsequently amortized as an adjustment to yield over the estimated contractual lives of the loans. There is no allowance for loan losses established at the acquisition date for acquired performing loans. An allowance for loan losses is recorded for any credit deterioration in these loans subsequent to acquisition.

Acquired loans that met the criteria for impaired or nonaccrual of interest prior to the acquisition may be considered performing upon acquisition, regardless of whether the customer is contractually delinquent, if the Company expects to fully collect the new carrying value (i.e. fair value) of the loans. As such, the Company may no longer consider the loan to be nonaccrual or nonperforming at the date of acquisition and may accrue interest on these loans, including the impact of any accretable discount. In addition, charge-offs on such loans would be first applied to the nonaccretable difference portion of the fair value adjustment.

Goodwill and Other Intangible Assets – Goodwill resulting from business combinations is generally determined as the excess of the fair value of the consideration transferred over the fair value of the net assets acquired and liabilities assumed as of the acquisition date. Goodwill is not amortized, but is tested for impairment at least annually or more frequently if events and circumstances exist that indicate that an impairment test should be performed. Intangible assets with definite lives are amortized over their estimated useful lives.

Core deposit intangible (“CDI”) is a measure of the value of checking and savings deposit relationships acquired in a business combination. The fair value of the CDI stemming from any given business combination is based on the present value of the expected cost savings attributable to the core deposit funding relative to an alternative source of funding. CDI is amortized over the estimated useful lives of the existing deposit relationships acquired, but does not exceed 10 years. Significantly all CDI is amortized using the sum of the years’ digits method.

The remaining other intangible assets consist of customer relationship and employment agreement intangible assets and are amortized over their estimated useful lives of 5 years.

Stock-based Compensation – The Company sponsors an equity incentive plan under which options to acquire shares of the Company’s common stock may be granted periodically to all full-time employees and directors of the Company or its affiliates at a specific exercise price. Shares are issued out of authorized and unissued common shares that have been reserved for issuance under such plan. Compensation cost is measured based on the estimated fair value of the award at the grant date and is recognized in earnings on a straight-line basis over the requisite service period. The fair value of stock options is estimated at the date of grant using the Black-Scholes option pricing model. This model requires assumptions as to the expected stock volatility, dividends, terms and risk-free rates. The expected volatility is based on the combination of the Company’s historical volatility and the volatility of comparable peer banks. The expected term represents the period of time that options are expected to be outstanding from the grant date. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for the appropriate life of each stock option.

Reclassification – Certain amounts in the Company’s Annual Report on Form 10-K, for the year ended December 31, 2019 have been reclassified to conform to the 2020 presentation.

Recent Accounting Pronouncements – Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) constitutes GAAP for nongovernmental entities. Updates to ASC are prescribed in Accounting Standards Updates (“ASU”), which are not authoritative until incorporated into ASC.

ASU 2016-02 Leases (Topic 842). The FASB amended existing guidance that requires that lessees recognize lease assets and lease liabilities on the balance sheet and disclose key information about leasing arrangements. The Company is in the process of determining the effect of the standard on its consolidated operating results and financial condition. These amendments are effective for the Company for annual periods beginning after December 15, 2021 and interim periods beginning after December 15, 2022.

ASU 2016-13 Financial Instruments - Credit Losses (Topic 326). The FASB issued guidance to replace the incurred loss model with an expected loss model, which is referred to as the current expected credit loss (“CECL”) model. The CECL model is applicable to the measurement of credit losses on financial assets measured at amortized cost, including loan receivables, held to maturity securities, and debt securities. ASU 2016-13 is effective for the Company for annual periods beginning after December 15, 2022, including interim periods within those fiscal years. Entities will apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. The Company is currently evaluating the impact adoption of ASU 2016-13 will have on its consolidated operating results and financial condition.

ASU 2017-04, Intangibles - Goodwill and Other (Topic 350). This ASU simplifies the accounting for goodwill impairment for all entities by eliminating Step 2 from the current provisions. Under the new guidance, an entity should perform the goodwill impairment test by comparing the fair value of a reporting unit with its carrying value and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. The Company elected to early adopt ASU 2017-04 on January 1, 2020, and it did not have a significant impact on its financial statements. The Company’s policy is to test goodwill for impairment annually or on an interim basis if an event triggering impairment may have occurred. During the period ended September 30, 2020, the economic disruption and uncertainty surrounding the ongoing COVID-19 pandemic and the recent volatility in the market price of crude oil resulted in a decrease in the Company’s stock price. The Company believed this resulted in a triggering event requiring an interim goodwill impairment quantitative analysis. Under the new simplified guidance, the Company’s estimated fair value as of September 30, 2020 exceeded its carrying amount resulting in no impairment charge for the period. Management will continue to evaluate the economic conditions at future reporting periods for applicable changes.

ASU 2019-12, Income Taxes, Simplifying the Accounting for Income Taxes (Topic 740). In December 2019, the FASB issued ASU 2019-12 to simplify the accounting for income taxes by removing certain exceptions to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition for deferred tax liabilities for outside basis differences. This update is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted, including adoption in any interim period for which financial statements have not yet been issued. The update is not expected to have any material effect on the Company’s financial statements.

Subsequent Events – The Company has evaluated subsequent events and transactions from September 30, 2020 through the date this Form 10-Q was filed with the SEC for potential recognition or disclosure as required by GAAP and determined that there were no material subsequent events requiring recognition or disclosure.

SECURITIES

9 Months Ended

Sep. 30, 2020

SECURITIES [Abstract]

SECURITIES

2. SECURITIES

The amortized cost and fair value of securities, with gross unrealized gains and losses, at period-end follow:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
September 30, 2020
Available for sale:
U.S. government and agencies	$	4,750	$	35	$	—		$	4,785
State and municipal		242,010		8,248		(428	)		249,830
Mortgage-backed securities		309,227		15,778		—			325,005
Collateralized mortgage obligations		107,249		—		(472	)		106,777
Asset-backed and other amortizing securities		32,614		2,313		—			34,927
Other securities		5,000		10		(5	)		5,005
	$	700,850	$	26,384	$	(905	)	$	726,329

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
December 31, 2019
Available for sale:
U.S. government and agencies	$	4,750	$	57	$	—		$	4,807
State and municipal		94,512		1,091		(911	)		94,692
Mortgage-backed securities		463,899		3,727		(3,110	)		464,516
Collateralized mortgage obligations		107,443		15		(169	)		107,289
Asset-backed and other amortizing securities		35,833		522		(9	)		36,346
	$	706,437	$	5,412	$	(4,199	)	$	707,650

The amortized cost and fair value of securities at September 30, 2020 are presented below by contractual maturity. Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations. Other securities are shown separately since they are not due at a single maturity date.

	Available for Sale
	Amortized Cost		Fair Value
Within 1 year	$	5,760	$	5,800
After 1 year through 5 years		1,246		1,343
After 5 years through 10 years		20,825		21,658
After 10 years		223,930		230,820
Other		449,089		466,708
	$	700,850	$	726,329

At both September 30, 2020 and December 31, 2019, there were no holdings of securities of any one issuer, other than the U.S. government and its agencies, in an amount greater than 10% of stockholders’ equity.

Securities with a carrying value of approximately $260.0 million and $211.0 million at September 30, 2020 and December 31, 2019, respectively, were pledged to collateralize public deposits and for other purposes as required or permitted by law.

The following table segregates securities with unrealized losses at the periods indicated, by the duration they have been in a loss position:

	Less than 12 Months				12 Months or More				Total
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
September 30, 2020
U.S. government and agencies	$	—	$	—	$	—	$	—	$	—	$	—
State and municipal		34,380		428		—		—		34,380		428
Mortgage-backed securities		—		—		—		—		—		—
Collateralized mortgage obligations		106,777		472		—		—		106,777		472
Asset-backed and other amortizing securities		3,495		5		—		—		3,495		5
	$	144,652	$	905	$	—	$	—	$	144,652	$	905

December 31, 2019
U.S. government and agencies	$	—	$	—	$	—	$	—	$	—	$	—
State and municipal		58,389		910		387		1		58,776		911
Mortgage-backed securities		284,120		3,070		4,661		40		288,781		3,110
Collateralized mortgage obligations		60,039		169		—		—		60,039		169
Asset-backed and other amortizing securities		2,661		9		—		—		2,661		9
	$	405,209	$	4,158	$	5,048	$	41	$	410,257	$	4,199

There were eight securities with an unrealized loss at September 30, 2020. Management does not believe that these losses are other than temporary as there is no intent to sell any of these securities before recovery and it is not probable that we will be required to sell any of these securities before recovery, and credit loss, if any, is not material. Any unrealized losses are largely due to increases in market interest rates over the yields available at the time the underlying securities were purchased. The fair value is expected to recover as the securities approach their maturity date or if market yields for such investments decline. Management does not believe any of the securities are impaired due to reasons of credit quality. Accordingly, as of September 30, 2020, management believes the impairments detailed in the table above are temporary and no impairment loss has been realized in the Company’s consolidated financial statements.

LOANS HELD FOR INVESTMENT

9 Months Ended

Sep. 30, 2020

LOANS HELD FOR INVESTMENT [Abstract]

LOANS HELD FOR INVESTMENT

3. LOANS HELD FOR INVESTMENT

Loans held for investment are summarized by category as of the periods presented below:

	September 30, 2020			December 31, 2019
Commercial real estate	$	655,432		$	658,195
Commercial - specialized		340,458			309,505
Commercial - general		578,181			441,398
Consumer:
1-4 family residential		372,114			362,796
Auto loans		193,023			215,209
Other consumer		68,877			74,000
Construction		80,149			82,520
		2,288,234			2,143,623
Allowance for loan losses		(46,076	)		(24,197	)
Loans, net	$	2,242,158		$	2,119,426

The Company has certain lending policies, underwriting standards, and procedures in place that are designed to maximize loan income with an acceptable level of risk. Management reviews and approves these policies, underwriting standards, and procedures on a regular basis and makes changes as appropriate. Management receives frequent reports related to loan originations, quality, concentrations, delinquencies, non-performing, and potential problem loans. Diversification in the loan portfolio is a means of managing risk associated with fluctuations in economic conditions, both by type of loan and geography.

Commercial – General and Specialized – Commercial loans are underwritten after evaluating and understanding the borrower’s ability to operate profitably. Underwriting standards have been designed to determine whether the borrower possesses sound business ethics and practices, evaluate current and projected cash flows to determine the ability of the borrower to repay their obligations, as agreed and ensure appropriate collateral is obtained to secure the loan. Commercial loans are primarily made based on the identified cash flows of the borrower and, secondarily, on the underlying collateral provided by the borrower. Most commercial loans are secured by the assets being financed or other business assets, such as real estate, accounts receivable, or inventory, and include personal guarantees. Owner-occupied real estate is included in commercial loans, as the repayment of these loans is generally dependent on the operations of the commercial borrower’s business rather than on income-producing properties or the sale of the properties. Commercial loans are grouped into two distinct sub-categories: specialized and general. Commercial related segments that are considered “specialized” include agricultural production and real estate loans, energy loans, and finance, investment, and insurance loans. Commercial related segments that contain a broader diversity of borrowers, sub-industries, or serviced industries are grouped into the “general category.” These include goods, services, restaurant & retail, construction, and other industries.

Commercial Real Estate – Commercial real estate loans are also subject to underwriting standards and processes similar to commercial loans. These loans are underwritten primarily based on projected cash flows for income-producing properties and collateral values for non-income-producing properties. The repayment of these loans is generally dependent on the successful operation of the property securing the loans or the sale or refinancing of the property. Real estate loans may be adversely affected by conditions in the real estate markets or in the general economy. The properties securing the Company’s real estate portfolio are diversified by type and geographic location. This diversity helps reduce the exposure to adverse economic events that affect any single market or industry.

Construction – Loans for residential construction are for single-family properties to developers, builders, or end-users. These loans are underwritten based on estimates of costs and completed value of the project. Funds are advanced based on estimated percentage of completion for the project. Performance of these loans is affected by economic conditions as well as the ability to control costs of the projects.

Consumer – Loans to consumers include 1-4 family residential loans, auto loans, and other loans for recreational vehicles or other purposes. The Company utilizes a computer-based credit scoring analysis to supplement its policies and procedures in underwriting consumer loans. The Company’s loan policy addresses types of consumer loans that may be originated and the collateral, if secured, which must be perfected. The relatively smaller individual dollar amounts of consumer loans that are spread over numerous individual borrowers also minimizes the Company’s risk. The Company generally requires mortgage title insurance and hazard insurance on 1-4 family residential loans.

The allowance for loan losses was $46.1 million at September 30, 2020, compared to $24.2 million at December 31, 2019. The allowance for loan losses to loans held for investment was 2.01% at September 30, 2020 and 1.13% at December 31, 2019. The increase in the allowance for loan losses at September 30, 2020 compared to December 31, 2019 is a result of economic effects from the ongoing COVID-19 pandemic as well as the decline in oil and gas prices that started in the first quarter of 2020. The increase in the provision for loan losses in the second quarter 2020 compared to the first quarter 2020 is a result of a further worsening of the economy and continued uncertainty from the ongoing COVID-19 pandemic. The full extent of the impact of the COVID-19 pandemic on the economy and the Company’s customers is still unknown at this time. Accordingly, additional provisions for loan losses may be necessary in future periods.

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

	Beginning Balance		Provision for Loan Losses			Charge-offs			Recoveries		Ending Balance
For the three months ended September 30, 2020
Commercial real estate	$	15,156	$	3,085		$	—		$	23	$	18,264
Commercial - specialized		6,614		(220	)		(109	)		19		6,304
Commercial - general		9,293		977			(372	)		91		9,989
Consumer:
1-4 family residential		2,926		1,688			(56	)		126		4,684
Auto loans		3,939		474			(212	)		32		4,233
Other consumer		1,640		250			(262	)		99		1,727
Construction		1,067		(192	)		—			—		875
Total	$	40,635	$	6,062		$	(1,011	)	$	390	$	46,076

For the three months ended September 30, 2019
Commercial real estate	$	5,415	$	(379	)	$	—		$	108	$	5,144
Commercial - specialized		3,346		(575	)		—			28		2,799
Commercial - general		8,325		734			(170	)		19		8,908
Consumer:
1-4 family residential		2,310		384			(65	)		9		2,638
Auto loans		3,067		127			(260	)		83		3,017
Other consumer		1,199		121			(230	)		63		1,153
Construction		509		8			—			—		517
Total	$	24,171	$	420		$	(725	)	$	310	$	24,176

	Beginning Balance		Provision for Loan Losses			Charge-offs			Recoveries		Ending Balance
For the nine months ended September 30, 2020
Commercial real estate	$	5,049	$	12,977		$	—		$	238	$	18,264
Commercial - specialized		2,287		4,870			(959	)		106		6,304
Commercial - general		9,609		1,952			(1,752	)		180		9,989
Consumer:
1-4 family residential		2,093		2,520			(56	)		127		4,684
Auto loans		3,385		1,624			(916	)		140		4,233
Other consumer		1,341		1,045			(1,011	)		352		1,727
Construction		433		441			—			1		875

Total	$	24,197	$	25,429		$	(4,694	)	$	1,144	$	46,076

For the nine months ended September 30, 2019
Commercial real estate	$	5,579	$	(758	)	$	—		$	323	$	5,144
Commercial - specialized		2,516		230			(37	)		90		2,799
Commercial - general		8,173		674			(235	)		296		8,908
Consumer:
1-4 family residential		2,249		412			(84	)		61		2,638
Auto loans		2,994		626			(765	)		162		3,017
Other consumer		1,192		550			(744	)		155		1,153
Construction		423		169			(75	)		—		517

Total	$	23,126	$	1,903		$	(1,940	)	$	1,087	$	24,176

The following table shows the Company’s investment in loans disaggregated based on the method of evaluating impairment:

	Recorded Investment				Allowance for Loan Losses
	Individually Evaluated		Collectively Evaluated		Individually Evaluated		Collectively Evaluated
September 30, 2020
Commercial real estate	$	4,339	$	651,093	$	260	$	18,004
Commercial - specialized		—		340,458		—		6,304
Commercial - general		7,071		571,110		1,734		8,255
Consumer:
1-4 family residential		2,236		369,878		70		4,614
Auto loans		—		193,023		—		4,233
Other consumer		—		68,877		—		1,727
Construction		—		80,149		—		875

Total	$	13,646	$	2,274,588	$	2,064	$	44,012

December 31, 2019
Commercial real estate	$	299	$	657,896	$	—	$	5,049
Commercial - specialized		573		308,932		—		2,287
Commercial - general		1,396		440,002		525		9,084
Consumer:
1-4 family residential		1,899		360,897		—		2,093
Auto loans		—		215,209		—		3,385
Other consumer		—		74,000		—		1,341
Construction		—		82,520		—		433

Total	$	4,167	$	2,139,456	$	525	$	23,672

Impaired loan information follows:

	Unpaid Contractual Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance		Average Recorded Investment
September 30, 2020
Commercial real estate	$	4,339	$	3,380	$	959	$	4,339	$	260	$	2,699
Commercial - specialized		—		—		—		—		—		673
Commercial - general		7,071		3,298		3,773		7,071		1,734		4,622
Consumer:
1-4 family		2,655		1,814		422		2,236		70		2,212
Auto loans		—		—		—		—		—		—
Other consumer		—		—		—		—		—		—
Construction		—		—		—		—		—		—

Total	$	14,065	$	8,492	$	5,154	$	13,646	$	2,064	$	10,206

December 31, 2019
Commercial real estate	$	754	$	299	$	—	$	299	$	—	$	1,059
Commercial - specialized		573		573		—		573		—		1,345
Commercial - general		1,839		—		1,396		1,396		525		2,173
Consumer:
1-4 family		2,318		1,899		—		1,899		—		2,187
Auto loans		—		—		—		—		—		—
Other consumer		—		—		—		—		—		—
Construction		—		—		—		—		—		—

Total	$	5,484	$	2,771	$	1,396	$	4,167	$	525	$	6,764

All impaired loans $250,000 and greater were specifically evaluated for impairment. Interest income recognized using a cash-basis method on impaired loans for the nine-month period ended September 30, 2020 and the year ended December 31, 2019 was not significant. Additional funds committed to be advanced on impaired loans are not significant.

The table below provides an age analysis on accruing past-due loans and nonaccrual loans:

	30-89 Days Past Due		90 Days or More Past Due		Nonaccrual
September 30, 2020
Commercial real estate	$	2,846	$	—	$	4,382
Commercial - specialized		304		—		205
Commercial - general		406		—		7,638
Consumer:
1-4 Family residential		1,203		1,851		789
Auto loans		567		73		—
Other consumer		779		15		53
Construction		—		—		—

Total	$	6,105	$	1,939	$	13,067

December 31, 2019
Commercial real estate	$	37	$	116	$	162
Commercial - specialized		708		—		1,172
Commercial - general		1,747		—		2,254
Consumer:
1-4 Family residential		1,212		932		1,105
Auto loans		1,468		183		—
Other consumer		848		121		—
Construction		1,159		—		—

Total	$	7,179	$	1,352	$	4,693

The Company grades its loans on a thirteen-point grading scale. These grades fit in one of the following categories: (i) pass, (ii) special mention, (iii) substandard, (iv) doubtful, or (v) loss. Loans categorized as loss are charged-off immediately. The grading of loans reflect a judgment about the risks of default associated with the loan. The Company reviews the grades on loans as part of our on-going monitoring of the credit quality of our loan portfolio.

Pass loans have financial factors or nature of collateral that are considered reasonable credit risks in the normal course of lending and encompass several grades that are assigned based on varying levels of risk, ranging from credits that are secured by cash or marketable securities, to watch credits which have all the characteristics of an acceptable credit risk but warrant more than the normal level of monitoring.

Special mention loans have potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of repayment prospects for the loans at some future date.

Substandard loans are inadequately protected by the current net worth and paying capacity of the borrower or by the collateral pledged, if any. These loans have a well-defined weakness or weaknesses that jeopardize collection and present the distinct possibility that some loss will be sustained if the deficiencies are not corrected. A protracted workout on these credits is a distinct possibility. Prompt corrective action is therefore required to strengthen the Company’s position, and/or to reduce exposure and to assure that adequate remedial measures are taken by the borrower. Credit exposure becomes more likely in such credits and a serious evaluation of the secondary support to the credit is performed. Substandard loans can be accruing or can be nonaccrual depending on the circumstances of the individual loans.

Doubtful loans have all the weaknesses inherent in substandard loans with the added characteristics that the weaknesses make collection or liquidation in full on the basis of currently existing facts, conditions, and values highly questionable and improbable. All doubtful loans are on nonaccrual.

The following table summarizes the internal classifications of loans:

	Pass		Special Mention		Substandard		Doubtful		Total
September 30, 2020
Commercial real estate	$	593,746	$	—	$	61,686	$	—	$	655,432
Commercial - specialized		331,377		—		9,081		—		340,458
Commercial - general		566,802		—		11,379		—		578,181
Consumer:
1-4 family residential		364,413		—		7,701		—		372,114
Auto loans		191,727		—		1,296		—		193,023
Other consumer		68,447		—		430		—		68,877
Construction		80,149		—		—		—		80,149

Total	$	2,196,661	$	—	$	91,573	$	—	$	2,288,234

December 31, 2019
Commercial real estate	$	632,641	$	22,313	$	3,241	$	—	$	658,195
Commercial - specialized		307,239		—		2,266		—		309,505
Commercial - general		428,155		—		13,243		—		441,398
Consumer:
1-4 family residential		356,422		—		6,374		—		362,796
Auto loans		214,363		—		846		—		215,209
Other consumer		73,716		—		284		—		74,000
Construction		82,520		—		—		—		82,520

Total	$	2,095,056	$	22,313	$	26,254	$	—	$	2,143,623

Under section 4013 of the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), banks may elect to deem that loan modifications do not result in a classification as a troubled debt restructuring (“TDR”) if they are (1) related to the COVID-19 pandemic; (2) executed on a loan that was not more than 30 days past due as of December 31, 2019; and (3) executed between March 1, 2020, and the earlier of (A) 60 days after the date of termination of the national emergency or (B) December 31, 2020. The Company elected to adopt these provisions of the CARES Act.

Additionally, other short-term modifications made on a good faith basis in response to the COVID-19 pandemic to borrowers who were current prior to any relief are not TDRs under ASC Subtopic 310-40 and the interagency statement released by the federal banking regulators on April 7, 2020 in response to the COVID-19 pandemic (the “Joint Interagency Regulatory Guidance”). This includes short-term (e.g., up to six months) modifications such as payment deferrals, fee waivers, extensions of repayment terms, or delays in payment that are insignificant. Borrowers considered current are those that are less than 30 days past due on their contractual payments at the time a modification program is implemented.

In response to the COVID-19 pandemic, the Company implemented a short-term deferral modification program that complies with ASC Subtopic 310-40 and the Joint Interagency Regulatory Guidance. As of September 30, 2020, the Company has an outstanding principal balance of modified loans of $53.8 million in loans that comply with ASC Subtopic 310-40 and the Joint Interagency Regulatory Guidance. These modifications include: $44.2 million in six months of interest-only payments, $8.2 million in 90 day commercial payment deferrals, and $1.4 million in consumer one to four month payment deferrals. The total of all of these short-term modifications represented 2.35% of outstanding loans held for investment at September 30, 2020.

Beginning in April 2020, the Company began offering additional COVID-19 related deferral and modification of principal and/or interest payments to selected borrowers on a case-by-case basis that were outside the scope of the short-term deferral modification program. These additional modifications comply with the provisions of section 4013 of the CARES Act. As of September 30, 2020 the Company had 23 loans totaling approximately $70.2 million subject to these deferral and modification agreements, representing 3.07% of outstanding loans held for investment.

There were no loans modified as a troubled debt restructurings during the nine-month period ended September 30, 2020 and the year ended December 31, 2019.

GOODWILL AND INTANGIBLES

9 Months Ended

Sep. 30, 2020

GOODWILL AND INTANGIBLES [Abstract]

GOODWILL AND INTANGIBLES

4. GOODWILL AND INTANGIBLES

Goodwill and other intangible assets are summarized below:

	September 30, 2020			December 31, 2019
Beginning goodwill	$	18,757		$	—
Arising from business combinations		—			18,757
Measurement period acquisition adjustment		751			—
Ending goodwill	$	19,508		$	18,757
Amortized intangible assets
Customer relationship intangibles	$	6,679		$	6,679
Less: Accumulated amortization		(1,113	)		(202	)
		5,566			6,477

Other intangibles		2,309			2,309
Arising from business combinations		663			—
Less: Accumulated amortization		(544	)		(154	)
		2,428			2,155

Other intangible assets, net	$	7,994		$	8,632

BORROWING ARRANGEMENTS	9 Months Ended
BORROWING ARRANGEMENTS	Sep. 30, 2020
BORROWING ARRANGEMENTS [Abstract]
BORROWING ARRANGEMENTS	5. BORROWING ARRANGEMENTS Subordinated Debt Securities In December 2018, the Company issued $26.5 million in subordinated debt securities. $12.4 million of the securities have a maturity date of December 2028 and an average fixed rate of 5.74% for the first five years. The remaining $14.1 million of securities have a maturity date of December 2030 and an average fixed rate of 6.41% for the first seven years. After the expiration of the fixed rate periods, all securities will float at the Wall Street Journal prime rate, with a floor of 4.5% and a ceiling of 7.5%. These securities pay interest quarterly, are unsecured, and may be called by the Company at any time after the remaining maturity is five years or less. Additionally, these securities qualify for Tier 2 capital treatment, subject to regulatory limitations. On September 29, 2020, the Company issued $50.0 million in subordinated debt securities. Proceeds were reduced by approximately $926,000 in debt issuance costs. The securities have a maturity date of September 2030 with a fixed rate of 4.50% for the first five years. After the expiration of the fixed rate period, the securities will reset quarterly at a variable rate equal to the then current three-month Secured Overnight Financing Rate (“SOFR”), as published by the Federal Reserve Bank of New York, plus 438 basis points. These securities pay interest semi-annually, are unsecured, and may be called by the Company at any time after the remaining maturity is five years or less. Additionally, these securities qualify for Tier 2 capital treatment, subject to regulatory limitations. Notes Payable and Other Borrowings City Bank has multiple advances from the Federal Home Loan Bank of Dallas (“FHLB”). The advances are collateralized through the line of credit with FHLB with interest payable monthly and principal due at maturity. In April 2020, City Bank borrowed $75 million from FHLB, on a term of three months, for liquidity needs associated with funding Paycheck Protection Program loans. The three month advance matured in July 2020 and was repaid. Additionally, a $20 million long-term advance matured in July 2020 and was repaid.

STOCK-BASED COMPENSATION

9 Months Ended

Sep. 30, 2020

STOCK-BASED COMPENSATION [Abstract]

STOCK-BASED COMPENSATION

6. STOCK-BASED COMPENSATION

Equity Incentive Plan

The 2019 Equity Incentive Plan (“Plan”) was approved by the Company’s Board of Directors on January 16, 2019 and by its shareholders on March 6, 2019. The purpose of the Plan is to: (i) attract and retain the best available personnel for positions of substantial responsibility, (ii) provide additional incentive to employees, directors and consultants, and (iii) promote the success of the Company’s business. This Plan permits the grant of incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock, restricted stock units, performance units, performance shares, and other stock-based awards. The maximum aggregate number of shares of common stock that may be issued pursuant to all awards under the Plan is 2,300,000. The maximum aggregate number of shares that may be issued under the Plan may be increased annually by up to 3% of the total issued and outstanding common shares of the Company at the beginning of each fiscal year.

The fair value of each option award is estimated on the date of grant using a closed form option valuation (“Black-Scholes”) model that uses the assumptions noted in the table below. Expected volatilities are based on historical volatilities of the Company’s common stock and similar peer company averages. The Company uses historical data to estimate option exercise and post-vesting termination behavior. The expected term of options granted represents the period of time that options granted are expected to be outstanding, which takes in to account that the options are not transferable. The risk-free interest rate for the expected term of the option is based on U.S. Treasury yield curve in effect at the time of the grant.

Options

A summary of activity in the Plan during the nine months ended September 30, 2020 is presented in the table below:

	Number of Shares			Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Life in Years		Aggregate Intrinsic Value
Nine Months Ended September 30, 2020
Outstanding at beginning of year:		1,462,997		$	13.42
Granted		248,966			20.96
Exercised		(27,851	)		10.72
Forfeited		(20,151	)		17.86
Expired		(1,263	)		16.00

Balance, September 30, 2020		1,662,698		$	14.54		5.97	$	1,657

Exercisable at end of period		1,065,753		$	12.11		5.21	$	1,657

Vested at end of period		1,065,753		$	12.11		5.21	$	1,657

A summary of assumptions used to calculate the fair values of the awards granted during the periods noted is presented below:

	Nine Months Ended September 30,
	2020			2019
Expected volatility		27.46	%	24.88% to 31.54%
Expected dividend yield		0.70	%		0.70	%
Expected term (years)	6.2 years			0.5 - 7.0 years
Risk-free interest rate		1.44	%	1.46% to 2.63%
Weighted average grant date fair value	$	5.68		$	8.01

The total intrinsic value of options exercised during the nine months ended September 30, 2020 was $185 thousand. There were no options exercised during the nine months ended September 30, 2019.

On January 16, 2019, the Company approved the conversion of its previously issued stock appreciation rights (“SARs”) to stock options. There were 1,401,000 outstanding SARs that were converted effective as of May 6, 2019. The fair value of the SARs was $11.5 million at the conversion date. During the modification of these awards from liabilities to equity, the Company accelerated the expiration date, between two and four years, on 750,000 of the stock options. As a result, the fair value of the stock options after modification was $11.2 million. However, since the fair value of the new equity awards was less than the fair value of the liability awards, no adjustment was made to the Company’s income statement. The $11.5 million was reclassified from liabilities to equity upon conversion on May 6, 2019.

Restricted Stock Units

A summary of activity in the Plan is presented in the table below:

	Number of Shares			Weighted-Average Grant Date Fair Value
Nine Months Ended September 30, 2020
Outstanding at beginning of year:		81,200		$	19.46
Granted		5,970			20.93
Vested		(24,694	)		19.79
Forfeited		—			—

Balance, September 30, 2020		62,476		$	19.47

Restricted stock units granted under the Plan typically vest over five years, but vesting periods may vary. Compensation expense for these grants will be recognized over the vesting period of the awards based on the fair value of the stock at the issue date.

The total unrecognized compensation cost for the awards outstanding under the Plan at September 30, 2020 was $3.1 million and will be recognized over a weighted average remaining period of 1.79 years. The total fair value of restricted stock units vested during the nine months ended September 30, 2020 was $489,000. There was no vesting of restricted stock units during the nine months ended September 30, 2019.

COMMITMENTS AND CONTINGENCIES

9 Months Ended

Sep. 30, 2020

COMMITMENTS AND CONTINGENCIES [Abstract]

COMMITMENTS AND CONTINGENCIES

7. COMMITMENTS AND CONTINGENCIES

Financial instruments with off-balance-sheet risk - The Company is a party to financial instruments with off-balance-sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and standby letters of credit. Such commitments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the Company’s consolidated financial statements. The Company’s exposure to credit loss is represented by the contractual amount of these commitments. The Company follows the same credit policies in making commitments as it does for recorded instruments.

Financial instruments whose contract amounts represent credit risk outstanding follow:

	September 30, 2020		December 31, 2019
Commitments to grant loans and unfunded commitments under lines of credit	$	439,633	$	409,969
Standby letters of credit		7,004		10,748

Commitments to grant loans and extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. The commitments for lines of credit may expire without being drawn upon. Therefore, the total commitment amounts do not necessarily represent future cash requirements. The amount of collateral obtained, if it is deemed necessary by the Company, is based on management’s credit evaluation of the customer.

Standby letters of credit are conditional commitments issued by the Company to guarantee the performance of a customer to a third party. Those letters of credit are primarily issued to support public and private borrowing arrangements. Essentially all letters of credit issued have expiration dates within one year. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. The Company requires collateral supporting those commitments if deemed necessary.

Litigation - The Company is a defendant in legal actions arising from time to time in the ordinary course of business. Management believes that the aggregate ultimate liability, if any, arising from these matters will not materially affect the Company’s consolidated financial statements.

FHLB Letters of Credit - The Company uses FHLB letters of credit to pledge to certain public deposits. The balance of these FHLB letters of credit was $199.0 million at both September 30, 2020 and December 31, 2019.

CAPITAL AND REGULATORY MATTERS

9 Months Ended

Sep. 30, 2020

CAPITAL AND REGULATORY MATTERS [Abstract]

CAPITAL AND REGULATORY MATTERS

8. CAPITAL AND REGULATORY MATTERS

The Company and its bank subsidiary are subject to various regulatory capital requirements administered by its banking regulators. 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 and its bank subsidiary’s financial statements. Under capital guidelines and the regulatory framework for prompt corrective action, the Company and its bank subsidiary must meet specific capital guidelines that involve quantitative measures of their assets, liabilities, and certain off-balance-sheet items as calculated under regulatory accounting practices. The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Prompt corrective action provisions are not applicable to bank holding companies.

In July 2013, the Board of Governors of the Federal Reserve System published final rules for the adoption of the Basel III regulatory capital framework (“Basel III”). Basel III, among other things, (i) introduced a new capital measure called Common Equity Tier 1 (“CET1”), (ii) specified that Tier 1 capital consists of CET1 and Additional Tier 1 Capital instruments meeting specified requirements, (iii) defined CET1 narrowly by requiring that most deductions/adjustments to regulatory capital measures be made to CET1 and not to the other components of capital and (iv) expanded the scope of the deductions/adjustments as compared to existing regulations. Basel III became effective for the Company and its bank subsidiary on January 1, 2016 with certain transition provisions fully phased-in on January 1, 2019.

Quantitative measures established by regulation to ensure capital adequacy require the Company and its bank subsidiary to maintain minimum amounts and ratios (set forth in the following table) of total, Tier 1 and CET1 capital (as defined in the regulations) to risk-weighted assets (as defined) and of Tier 1 capital (as defined) to average assets (as defined). Management believes, as of September 30, 2020 and December 31, 2019, that the Company and its bank subsidiary met all capital adequacy requirements to which they are subject.

As of September 30, 2020, the bank subsidiary was well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized, an institution must maintain minimum total risk-based, Tier 1 risk-based, CET1 and Tier 1 leverage ratios as set forth in the following tables. There are no conditions or events since September 30, 2020 that management believes have changed the bank subsidiary’s category.

The Company and its bank subsidiary’s actual capital amounts and ratios follow:

	Actual					Minimum Required Under BASEL III Fully Phased-In					To Be Well Capitalized Under Prompt Corrective Action Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
September 30, 2020
Total Capital to Risk Weighted Assets:
Consolidated	$	457,689		18.67	%	$	257,444		10.50	%		N/A		N/A
City Bank		394,673		16.10	%		257,430		10.50	%	$	245,171		10.00	%

Tier I Capital to Risk Weighted Assets:
Consolidated		351,303		14.33	%		208,407		8.50	%		N/A		N/A
City Bank		363,834		14.84	%		208,396		8.50	%		196,137		8.00	%

Common Equity Tier 1 to Risk Weighted Assets:
Consolidated		306,303		12.49	%		171,629		7.00	%		N/A		N/A
City Bank		363,834		14.84	%		171,620		7.00	%		159,361		6.50	%

Tier I Capital to Average Assets:
Consolidated		351,303		10.01	%		141,472		4.00	%		N/A		N/A
City Bank		363,834		10.37	%		141,401		4.00	%		175,376		5.00	%

December 31, 2019
Total Capital to Risk Weighted Assets:
Consolidated	$	373,684		14.88	%	$	263,769		10.50	%		N/A		N/A
City Bank		368,322		14.67	%		263,702		10.50	%	$	251,145		10.00	%

Tier I Capital to Risk Weighted Assets:
Consolidated		322,835		12.85	%		213,527		8.50	%		N/A		N/A
City Bank		343,945		13.70	%		213,473		8.50	%		200,916		8.00	%

Common Equity Tier 1 to Risk Weighted Assets:
Consolidated		277,835		11.06	%		175,846		7.00	%		N/A		N/A
City Bank		343,945		13.70	%		175,801		7.00	%		163,244		6.50	%

Tier I Capital to Average Assets:
Consolidated		322,835		10.74	%		120,219		4.00	%		N/A		N/A
City Bank		343,945		11.45	%		121,235		4.00	%		150,175		5.00	%

State banking regulations place certain restrictions on dividends paid by banks to their shareholders. Dividends paid by the Company’s bank subsidiary would be prohibited if the effect thereof would cause the bank subsidiary’s capital to be reduced below applicable minimum capital requirements.

- Definition

The entire disclosure for regulatory capital requirement for depository and lending institutions. Institutions include, but not are not limited to, finance company, insured depository institution, bank holding company, savings and loan association holding company, bank and savings institution not federally insured, mortgage company, foreign financial institution and credit union.

+ References + Details

DERIVATIVES

9 Months Ended

Sep. 30, 2020

DERIVATIVES [Abstract]

DERIVATIVES

9. DERIVATIVES

The Company utilizes interest rate and cash flow swap agreements as part of its asset-liability management strategy to help manage its interest rate and cash flow risk position. The notional amount of the interest rate and cash flow swaps do not represent amounts exchanged by the parties. The amount exchanged is determined by reference to the notional amounts and the other terms of the individual interest rate and cash flow swap agreements.

The following table reflects the fair value hedges included in the consolidated balance sheets:

	September 30, 2020				December 31, 2019
	Notional Amount		Fair Value		Notional Amount		Fair Value

Included in other liabilities:
Interest rate swaps related to fixed rate loans	$	10,276	$	1,028	$	10,557	$	351

Included in other assets:
Interest rate swaps related to fixed rate loans	$	—	$	—	$	—	$	—

The following table reflects the cash flow hedges included in the consolidated balance sheets:

	September 30, 2020				December 31, 2019
	Notional Amount		Fair Value		Notional Amount		Fair Value

Included in other liabilities:
Cash flow swaps related to state and municipal securities	$	123,760	$	1,643	$	—	$	—

Included in other assets:
Cash flow swaps related to state and municipal securities	$	—	$	—	$	—	$	—

Mortgage banking derivatives

The following table reflects the amount and fair value of mortgage banking derivatives in the consolidated balance sheets:

	September 30, 2020				December 31, 2019
	Notional Amount		Fair Value		Notional Amount		Fair Value

Included in other assets:
Forward contracts related to mortgage loans held for sale	$	—	$	—	$	—	$	—
Interest rate lock commitments		245,000		6,700		52,875		814

Total included in other assets	$	245,000	$	6,700	$	52,875	$	814

Included in other liabilities:
Forward contracts related to mortgage loans held for sale	$	210,724	$	1,006	$	58,948	$	141
Interest rate lock commitments		—		—		—		—

Total included in other liabilities	$	210,724	$	1,006	$	58,948	$	141

EARNINGS PER SHARE

9 Months Ended

Sep. 30, 2020

EARNINGS PER SHARE [Abstract]

EARNINGS PER SHARE

10. EARNINGS PER SHARE

The factors used in the earnings per share computation follow:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Net income	$	16,731	$	8,258	$	29,429	$	19,111

Weighted average common shares outstanding - basic		18,059,174		17,985,429		18,054,678		16,417,116
Effect of dilutive securities:
Stock-based compensation awards		196,987		377,604		269,044		160,606
Weighted average common shares outstanding - diluted		18,256,161		18,363,033		18,323,722		16,577,722

Basic earnings per share	$	0.93	$	0.46	$	1.63	$	1.16
Diluted earnings per share	$	0.92	$	0.45	$	1.61	$	1.15

SEGMENT INFORMATION

9 Months Ended

Sep. 30, 2020

SEGMENT INFORMATION [Abstract]

SEGMENT INFORMATION

11. SEGMENT INFORMATION

Financial results by reportable segment are detailed below:

Three Months Ended September 30, 2020	Banking			Insurance			Consolidated
Net interest income	$	31,273		$	—		$	31,273
Provision for loan loss		(6,062	)		—			(6,062	)
Noninterest income		28,393			3,267			31,660
Noninterest expense		(33,984	)		(2,009	)		(35,993	)

Income before income taxes		19,620			1,258			20,878

Income tax (expense) benefit		(3,891	)		(256	)		(4,147	)

Net income	$	15,729		$	1,002		$	16,731

Three Months Ended September 30, 2019	Banking			Insurance			Consolidated
Net interest income	$	26,568		$	—		$	26,568
Provision for loan loss		(420	)		—			(420	)
Noninterest income		13,048			1,067			14,115
Noninterest expense		(29,109	)		(919	)		(30,028	)

Income before income taxes		10,087			148			10,235

Income tax (expense) benefit		(1,945	)		(32	)		(1,977	)

Net income	$	8,142		$	116		$	8,258

Financial results by reportable segment are detailed below:

Nine Months Ended September 30, 2020	Banking			Insurance			Consolidated
Net interest income	$	91,920		$	—		$	91,920
Provision for loan loss		(25,429	)		—			(25,429	)
Noninterest income		70,050			5,381			75,431
Noninterest expense		(100,876	)		(4,335	)		(105,211	)

Income before income taxes		35,665			1,046			36,711

Income tax (expense) benefit		(7,008	)		(274	)		(7,282	)

Net income	$	28,657		$	772		$	29,429

Nine Months Ended September 30, 2019	Banking			Insurance			Consolidated
Net interest income	$	75,951		$	—		$	75,951
Provision for loan loss		(1,903	)		-			(1,903	)
Noninterest income		35,981			3,912			39,893
Noninterest expense		(87,279	)		(2,715	)		(89,994	)

Income before income taxes		22,750			1,197			23,947

Income tax (expense) benefit		(4,674	)		(162	)		(4,836	)

Net income	$	18,076		$	1,035		$	19,111

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 31
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8924-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-Section 50
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-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8981-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-Section 50
-Paragraph 32
-Subparagraph (f)
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
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-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8657-108599

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-Publisher FASB
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-URI http://asc.fasb.org/topic&trid=2134510

+ Details

FAIR VALUE DISCLOSURES

9 Months Ended

Sep. 30, 2020

FAIR VALUE DISCLOSURES [Abstract]

FAIR VALUE DISCLOSURES

12. FAIR VALUE DISCLOSURES

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. A fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability. The price in the principal (or most advantageous) market used to measure the fair value of the asset or liability is not adjusted for transaction costs. An orderly transaction is a transaction that assumes exposure to the market for a period prior to the measurement date to allow for marketing activities that are usual and customary for transactions involving such assets and liabilities; it is not a forced transaction. Market participants are buyers and sellers in the principal market that are (i) independent, (ii) knowledgeable, (iii) able to transact and (iv) willing to transact.

Valuation techniques that are consistent with the market approach, the income approach and/or the cost approach are required by GAAP. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets and liabilities. The income approach uses valuation techniques to convert future amounts, such as cash flows or earnings, to a single present amount on a discounted basis. The cost approach is based on the amount that currently would be required to replace the service capacity of an asset. Valuation techniques should be consistently applied. Inputs to valuation techniques refer to the assumptions that market participants would use in pricing the asset or liability. Inputs may be observable, meaning those that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from independent sources, or unobservable, meaning those that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The fair value hierarchy for valuation inputs 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 reporting entity 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 an entity’s own assumptions about the assumptions that market participants would use in pricing the assets or liabilities.

The following table summarizes fair value measurements:

	Level 1		Level 2			Level 3		Total
September 30, 2020
Assets (liabilities) measured at fair value on a recurring basis:
Securities available for sale:
U.S. government and agencies	$	—	$	4,785		$	—	$	4,785
State and municipal		5,878		243,952			—		249,830
Mortgage-backed securities		—		325,005			—		325,005
Collateralized mortgage obligations		—		106,777			—		106,777
Asset-backed and other amortizing securities		—		34,927			—		34,927
Other		—		5,005			—		5,005
Loans held for sale (mandatory)		—		60,478			—		60,478
Mortgage servicing rights		—		6,562			—		6,562
Asset derivatives		—		6,700			—		6,700
Liability derivatives		—		(3,677	)		—		(3,677	)

Assets measured at fair value on a non-recurring basis:
Impaired loans		—		—			11,582		11,582
Other real estate owned		—		—			1,336		1,336
Loans held for sale (best efforts)		—		16,029			—		16,029

December 31, 2019
Assets (liabilities) measured at fair value on a recurring basis:
Securities available for sale:
U.S. government and agencies	$	—	$	4,807		$	—	$	4,807
State and municipal		—		94,692			—		94,692
Mortgage-backed securities		—		464,516			—		464,516
Collateralized mortgage obligations		—		107,289			—		107,289
Asset-backed and other amortizing securities		—		36,346			—		36,346
Loans held for sale (mandatory)		—		32,809			—		32,809
Mortgage servicing rights		—		2,054			—		2,054
Asset derivatives		—		814			—		814
Liability derivatives		—		(492	)		—		(492	)

Assets measured at fair value on a non-recurring basis:
Impaired loans		—		—			3,642		3,642
Other real estate owned		—		—			1,883		1,883
Loans held for sale (best efforts)		—		16,226			—		16,226

Securities – Securities are carried at fair value. When available, fair value is based on quoted prices for the identical security in an active market and as such, would be classified as Level 1. If quoted market prices are not available, fair values are calculated based on market prices of similar securities using matrix pricing. Matrix pricing is a mathematical technique commonly used to price debt securities that are not actively traded. Securities for which Level 1 valuations are not available are classified as Level 2.

Loans held for sale (mandatory) – Loans held for sale originated for mandatory delivery are reported at fair value. Fair value is determined using quoted prices for similar assets, adjusted for specific attributes of that loan.

Mortgage servicing rights – Mortgage servicing rights are reported at fair value. Fair value is based on market prices for comparable mortgage servicing contracts.

Derivatives – Fair value of derivatives is based on valuation models using observable market data as of the measurement date.

Impaired loans – Impaired loans are reported at the fair value of the underlying collateral, less estimated disposal costs, if repayment is expected solely from the sale of the collateral. Collateral values are estimated using Level 2 inputs based on observable market data or Level 3 inputs based on customized discounting criteria.

Foreclosed assets – Foreclosed assets are transferred from loans at the lower of cost or fair value, less estimated costs to sell. Collateral values are estimated using Level 2 inputs based on observable market data or Level 3 inputs based on customized discounting criteria.

Loans held for sale (best efforts) – Loans held for sale originated for best efforts delivery are reported at fair value if, on an aggregate basis, the fair value for the loans is less than cost. In determining whether the fair value of loans held for sale is less than cost when quoted market prices are not available, the Company may consider outstanding investor commitments or discounted cash flow analyses with market assumptions. Such fair values are classified within either Level 2 or Level 3 of the fair value hierarchy.

The following table presents quantitative information about non-recurring Level 3 fair value measurements:

	Fair Value		Valuation Techniques	Unobservable Inputs	Range of Discounts
September 30, 2020
Impaired loans	$	11,582	Third party appraisals or inspections	Collateral discounts and selling costs		0%-100	%
Other real estate owned		1,336	Third party appraisals or inspections	Collateral discounts and selling costs		15%-66	%

December 31, 2019
Impaired loans	$	3,642	Third party appraisals or inspections	Collateral discounts and selling costs		0%-100	%
Other real estate owned		1,883	Third party appraisals or inspections	Collateral discounts and selling costs		15%-66	%

The estimated fair values, and related carrying amounts, of the Company’s financial instruments are as follows:

	Carrying Amount		Level 1		Level 2		Level 3		Total Fair Value

September 30, 2020
Financial assets:
Cash and cash equivalents	$	290,885	$	290,885	$	—	$	—	$	290,885
Loans, net		2,242,158		—		—		2,246,631		2,246,631
Accrued interest receivable		13,632		—		13,632		—		13,632
Bank-owned life insurance		70,401		—		70,401		—		70,401

Financial liabilities:
Deposits	$	2,943,802	$	2,674,130	$	274,768	$	—	$	2,948,898
Accrued interest payable		1,654		—		1,654		—		1,654
Notes payable & other borrowings		75,000		—		75,000		—		75,000
Junior subordinated deferrable interest debentures		46,393		—		46,393		—		46,393
Subordinated debt securities		75,546		—		75,546		—		75,546

	Carrying Amount		Level 1		Level 2		Level 3		Total Fair Value

December 31, 2019
Financial assets:
Cash and cash equivalents	$	158,099	$	158,099	$	—	$	—	$	158,099
Loans, net		2,119,426		—		—		2,123,289		2,123,289
Accrued interest receivable		13,924		—		13,924		—		13,924
Bank-owned life insurance		69,397		—		69,397		—		69,397

Financial liabilities:
Deposits	$	2,696,857	$	2,354,999	$	346,194	$	—	$	2,701,193
Accrued interest payable		2,283		—		2,283		—		2,283
Notes payable & other borrowings		95,000		—		95,000		—		95,000
Junior subordinated deferrable interest debentures		46,393		—		46,393		—		46,393
Subordinated debt securities		26,472		—		26,472		—		26,472

- 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

BUSINESS COMBINATIONS

9 Months Ended

Sep. 30, 2020

BUSINESS COMBINATIONS [Abstract]

BUSINESS COMBINATIONS

13. BUSINESS COMBINATIONS

In June 2020, Windmark acquired the operating assets of a crop insurance agency in Nebraska for $687,000. Fair value of the assets acquired in this transaction as of the closing date are as follows:

Cash paid	$	687

Assets acquired:
Premises and equipment, net	$	24
Customer list		512
Other intangible assets		151
Total assets acquired	$	687

The Company is still evaluating the fair values of other assets and other liabilities, additional adjustments may be recorded during the measurement period, but no later than one year from the closing date of the transaction. The Company will reflect measurement period adjustments, if any, in the period in which the adjustments are recognized, which may result in further adjustments to the values presented in the above table. The Company expects to finalize these values by June 30, 2021.

West Texas State Bank

In November 2019, the Company completed its acquisition of West Texas State Bank (“WTSB”). This transaction resulted in six additional branches. The Company paid the shareholders of WTSB $76.1 million in cash for all outstanding stock of WTSB and resulted in a 100% ownership interest.

The Company recognized total goodwill of $19.3 million, which is calculated as the excess of both the consideration exchanged and liabilities assumed compared to the fair market value of identifiable assets acquired. None of the goodwill recognized is expected to be deductible for income tax purposes.

The Company incurred expenses related to the acquisition of approximately $955,000 for the year ended December 31, 2019, which are included in noninterest expense in the consolidated statements of comprehensive income.

Non-credit impaired loans had a fair value of $196.2 million at the acquisition date and contractual balance of $198.4 million. As of the acquisition date, the Company expects that an insignificant amount of the contractual balance of these loans will be uncollectible. The difference of $2.2 million is being recognized into interest income as an adjustment to yield over the life of the loans. Purchased credit impaired loans were insignificant.

Fair values of the assets acquired and liabilities assumed in this transaction as of the closing date are as follows:

Cash paid	$	76,100

Assets acquired:
Cash and cash equivalents	$	77,903
Interest-bearing time deposits in banks		52,700
Federal funds purchased		26,468
Securities available for sale		68,398
Loans held for investment		195,228
Bank-owned life insurance		10,932
Premises and equipment, net		4,132
Accrued interest receivable		1,114
Core deposit intangible		6,679
Other assets		2,648
Total assets acquired	$	446,202

Liabilities assumed
Deposits	$	386,176
Accrued interest payable		55
Deferred tax liability		762
Other liabilities		2,424
Total liabilities assumed	$	389,417
Net assets acquired	$	56,785
Goodwill recorded in acquisition	$	19,315

In the first nine months of 2020, the Company made measurement period adjustments to reflect facts and circumstances in existence as of the closing date of the acquisition. These adjustments primarily included a $751,000 increase in goodwill, a $900,000 decrease in loans, and a $160,000 decrease in other liabilities. The amount of income recorded in current period earnings that would have been recorded in the previous reporting period had the adjustment been recognized as of the acquisition date is not significant. The Company is still evaluating the fair values of other assets and other liabilities, additional adjustments may be recorded during the measurement period, but no later than one year from the closing date of the transaction. The Company will reflect measurement period adjustments, if any, in the period in which the adjustments are recognized, which may result in further adjustments to the values presented in the above table. The Company expects to finalize these values by the year ended December 31, 2020.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

9 Months Ended

Sep. 30, 2020

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract]

Nature of Operations

Wholly Owned, Consolidated Subsidiaries:
City Bank	Bank subsidiary
Windmark Insurance Agency, Inc. (“Windmark”)	Non-bank subsidiary
Ruidoso Retail, Inc.	Non-bank subsidiary
CB Provence, LLC	Non-bank subsidiary
CBT Brushy Creek, LLC	Non-bank subsidiary
CBT Properties, LLC	Non-bank subsidiary
Wholly Owned, Equity Method Subsidiaries:
South Plains Financial Capital Trusts (SPFCT) III-V	Non-bank subsidiaries

Consolidation

Basis of Presentation

Use of Estimates

Change in Capital Structure

Loans

Allowance for Loan Losses

Acquired Loans

Goodwill and Other Intangible Assets

The remaining other intangible assets consist of customer relationship and employment agreement intangible assets and are amortized over their estimated useful lives of 5 years.

Stock-based Compensation

Reclassification

Reclassification – Certain amounts in the Company’s Annual Report on Form 10-K, for the year ended December 31, 2019 have been reclassified to conform to the 2020 presentation.

Recent Accounting Pronouncements

Subsequent Events

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

9 Months Ended

Sep. 30, 2020

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract]

Subsidiaries Information

The following are subsidiaries of SPFI:

Wholly Owned, Consolidated Subsidiaries:
City Bank	Bank subsidiary
Windmark Insurance Agency, Inc. (“Windmark”)	Non-bank subsidiary
Ruidoso Retail, Inc.	Non-bank subsidiary
CB Provence, LLC	Non-bank subsidiary
CBT Brushy Creek, LLC	Non-bank subsidiary
CBT Properties, LLC	Non-bank subsidiary
Wholly Owned, Equity Method Subsidiaries:
South Plains Financial Capital Trusts (SPFCT) III-V	Non-bank subsidiaries

SECURITIES (Tables)

9 Months Ended

Sep. 30, 2020

SECURITIES [Abstract]

Amortized Cost and Fair Value of Securities, with Gross Unrealized Gains and Losses

The amortized cost and fair value of securities, with gross unrealized gains and losses, at period-end follow:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
September 30, 2020
Available for sale:
U.S. government and agencies	$	4,750	$	35	$	—		$	4,785
State and municipal		242,010		8,248		(428	)		249,830
Mortgage-backed securities		309,227		15,778		—			325,005
Collateralized mortgage obligations		107,249		—		(472	)		106,777
Asset-backed and other amortizing securities		32,614		2,313		—			34,927
Other securities		5,000		10		(5	)		5,005
	$	700,850	$	26,384	$	(905	)	$	726,329

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
December 31, 2019
Available for sale:
U.S. government and agencies	$	4,750	$	57	$	—		$	4,807
State and municipal		94,512		1,091		(911	)		94,692
Mortgage-backed securities		463,899		3,727		(3,110	)		464,516
Collateralized mortgage obligations		107,443		15		(169	)		107,289
Asset-backed and other amortizing securities		35,833		522		(9	)		36,346
	$	706,437	$	5,412	$	(4,199	)	$	707,650

Amortized Cost and Fair Value of Securities by Contractual Maturity

	Available for Sale
	Amortized Cost		Fair Value
Within 1 year	$	5,760	$	5,800
After 1 year through 5 years		1,246		1,343
After 5 years through 10 years		20,825		21,658
After 10 years		223,930		230,820
Other		449,089		466,708
	$	700,850	$	726,329

Securities with Unrealized Losses Segregated by the Period in a Loss Position

The following table segregates securities with unrealized losses at the periods indicated, by the duration they have been in a loss position:

	Less than 12 Months				12 Months or More				Total
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
September 30, 2020
U.S. government and agencies	$	—	$	—	$	—	$	—	$	—	$	—
State and municipal		34,380		428		—		—		34,380		428
Mortgage-backed securities		—		—		—		—		—		—
Collateralized mortgage obligations		106,777		472		—		—		106,777		472
Asset-backed and other amortizing securities		3,495		5		—		—		3,495		5
	$	144,652	$	905	$	—	$	—	$	144,652	$	905

December 31, 2019
U.S. government and agencies	$	—	$	—	$	—	$	—	$	—	$	—
State and municipal		58,389		910		387		1		58,776		911
Mortgage-backed securities		284,120		3,070		4,661		40		288,781		3,110
Collateralized mortgage obligations		60,039		169		—		—		60,039		169
Asset-backed and other amortizing securities		2,661		9		—		—		2,661		9
	$	405,209	$	4,158	$	5,048	$	41	$	410,257	$	4,199

LOANS HELD FOR INVESTMENT (Tables)

9 Months Ended

Sep. 30, 2020

LOANS HELD FOR INVESTMENT [Abstract]

Summary of Loans Held for Investment by Category

Loans held for investment are summarized by category as of the periods presented below:

	September 30, 2020			December 31, 2019
Commercial real estate	$	655,432		$	658,195
Commercial - specialized		340,458			309,505
Commercial - general		578,181			441,398
Consumer:
1-4 family residential		372,114			362,796
Auto loans		193,023			215,209
Other consumer		68,877			74,000
Construction		80,149			82,520
		2,288,234			2,143,623
Allowance for loan losses		(46,076	)		(24,197	)
Loans, net	$	2,242,158		$	2,119,426

Activity in Allowance for Loan Losses and Investment in Loans Disaggregated Based on Method of Evaluating Impairment

	Beginning Balance		Provision for Loan Losses			Charge-offs			Recoveries		Ending Balance
For the three months ended September 30, 2020
Commercial real estate	$	15,156	$	3,085		$	—		$	23	$	18,264
Commercial - specialized		6,614		(220	)		(109	)		19		6,304
Commercial - general		9,293		977			(372	)		91		9,989
Consumer:
1-4 family residential		2,926		1,688			(56	)		126		4,684
Auto loans		3,939		474			(212	)		32		4,233
Other consumer		1,640		250			(262	)		99		1,727
Construction		1,067		(192	)		—			—		875
Total	$	40,635	$	6,062		$	(1,011	)	$	390	$	46,076

For the three months ended September 30, 2019
Commercial real estate	$	5,415	$	(379	)	$	—		$	108	$	5,144
Commercial - specialized		3,346		(575	)		—			28		2,799
Commercial - general		8,325		734			(170	)		19		8,908
Consumer:
1-4 family residential		2,310		384			(65	)		9		2,638
Auto loans		3,067		127			(260	)		83		3,017
Other consumer		1,199		121			(230	)		63		1,153
Construction		509		8			—			—		517
Total	$	24,171	$	420		$	(725	)	$	310	$	24,176

	Beginning Balance		Provision for Loan Losses			Charge-offs			Recoveries		Ending Balance
For the nine months ended September 30, 2020
Commercial real estate	$	5,049	$	12,977		$	—		$	238	$	18,264
Commercial - specialized		2,287		4,870			(959	)		106		6,304
Commercial - general		9,609		1,952			(1,752	)		180		9,989
Consumer:
1-4 family residential		2,093		2,520			(56	)		127		4,684
Auto loans		3,385		1,624			(916	)		140		4,233
Other consumer		1,341		1,045			(1,011	)		352		1,727
Construction		433		441			—			1		875

Total	$	24,197	$	25,429		$	(4,694	)	$	1,144	$	46,076

For the nine months ended September 30, 2019
Commercial real estate	$	5,579	$	(758	)	$	—		$	323	$	5,144
Commercial - specialized		2,516		230			(37	)		90		2,799
Commercial - general		8,173		674			(235	)		296		8,908
Consumer:
1-4 family residential		2,249		412			(84	)		61		2,638
Auto loans		2,994		626			(765	)		162		3,017
Other consumer		1,192		550			(744	)		155		1,153
Construction		423		169			(75	)		—		517

Total	$	23,126	$	1,903		$	(1,940	)	$	1,087	$	24,176

The following table shows the Company’s investment in loans disaggregated based on the method of evaluating impairment:

	Recorded Investment				Allowance for Loan Losses
	Individually Evaluated		Collectively Evaluated		Individually Evaluated		Collectively Evaluated
September 30, 2020
Commercial real estate	$	4,339	$	651,093	$	260	$	18,004
Commercial - specialized		—		340,458		—		6,304
Commercial - general		7,071		571,110		1,734		8,255
Consumer:
1-4 family residential		2,236		369,878		70		4,614
Auto loans		—		193,023		—		4,233
Other consumer		—		68,877		—		1,727
Construction		—		80,149		—		875

Total	$	13,646	$	2,274,588	$	2,064	$	44,012

December 31, 2019
Commercial real estate	$	299	$	657,896	$	—	$	5,049
Commercial - specialized		573		308,932		—		2,287
Commercial - general		1,396		440,002		525		9,084
Consumer:
1-4 family residential		1,899		360,897		—		2,093
Auto loans		—		215,209		—		3,385
Other consumer		—		74,000		—		1,341
Construction		—		82,520		—		433

Total	$	4,167	$	2,139,456	$	525	$	23,672

Impaired Loan Information

Impaired loan information follows:

	Unpaid Contractual Principal Balance		Recorded Investment With No Allowance		Recorded Investment With Allowance		Total Recorded Investment		Related Allowance		Average Recorded Investment
September 30, 2020
Commercial real estate	$	4,339	$	3,380	$	959	$	4,339	$	260	$	2,699
Commercial - specialized		—		—		—		—		—		673
Commercial - general		7,071		3,298		3,773		7,071		1,734		4,622
Consumer:
1-4 family		2,655		1,814		422		2,236		70		2,212
Auto loans		—		—		—		—		—		—
Other consumer		—		—		—		—		—		—
Construction		—		—		—		—		—		—

Total	$	14,065	$	8,492	$	5,154	$	13,646	$	2,064	$	10,206

December 31, 2019
Commercial real estate	$	754	$	299	$	—	$	299	$	—	$	1,059
Commercial - specialized		573		573		—		573		—		1,345
Commercial - general		1,839		—		1,396		1,396		525		2,173
Consumer:
1-4 family		2,318		1,899		—		1,899		—		2,187
Auto loans		—		—		—		—		—		—
Other consumer		—		—		—		—		—		—
Construction		—		—		—		—		—		—

Total	$	5,484	$	2,771	$	1,396	$	4,167	$	525	$	6,764

Age Analysis on Accruing Past-due Loans and Nonaccrual Loans

The table below provides an age analysis on accruing past-due loans and nonaccrual loans:

	30-89 Days Past Due		90 Days or More Past Due		Nonaccrual
September 30, 2020
Commercial real estate	$	2,846	$	—	$	4,382
Commercial - specialized		304		—		205
Commercial - general		406		—		7,638
Consumer:
1-4 Family residential		1,203		1,851		789
Auto loans		567		73		—
Other consumer		779		15		53
Construction		—		—		—

Total	$	6,105	$	1,939	$	13,067

December 31, 2019
Commercial real estate	$	37	$	116	$	162
Commercial - specialized		708		—		1,172
Commercial - general		1,747		—		2,254
Consumer:
1-4 Family residential		1,212		932		1,105
Auto loans		1,468		183		—
Other consumer		848		121		—
Construction		1,159		—		—

Total	$	7,179	$	1,352	$	4,693

Summary of Internal Classifications of Loans

The following table summarizes the internal classifications of loans:

	Pass		Special Mention		Substandard		Doubtful		Total
September 30, 2020
Commercial real estate	$	593,746	$	—	$	61,686	$	—	$	655,432
Commercial - specialized		331,377		—		9,081		—		340,458
Commercial - general		566,802		—		11,379		—		578,181
Consumer:
1-4 family residential		364,413		—		7,701		—		372,114
Auto loans		191,727		—		1,296		—		193,023
Other consumer		68,447		—		430		—		68,877
Construction		80,149		—		—		—		80,149

Total	$	2,196,661	$	—	$	91,573	$	—	$	2,288,234

December 31, 2019
Commercial real estate	$	632,641	$	22,313	$	3,241	$	—	$	658,195
Commercial - specialized		307,239		—		2,266		—		309,505
Commercial - general		428,155		—		13,243		—		441,398
Consumer:
1-4 family residential		356,422		—		6,374		—		362,796
Auto loans		214,363		—		846		—		215,209
Other consumer		73,716		—		284		—		74,000
Construction		82,520		—		—		—		82,520

Total	$	2,095,056	$	22,313	$	26,254	$	—	$	2,143,623

GOODWILL AND INTANGIBLES (Tables)

9 Months Ended

Sep. 30, 2020

GOODWILL AND INTANGIBLES [Abstract]

Goodwill and Other Intangible Assets

Goodwill and other intangible assets are summarized below:

	September 30, 2020			December 31, 2019
Beginning goodwill	$	18,757		$	—
Arising from business combinations		—			18,757
Measurement period acquisition adjustment		751			—
Ending goodwill	$	19,508		$	18,757
Amortized intangible assets
Customer relationship intangibles	$	6,679		$	6,679
Less: Accumulated amortization		(1,113	)		(202	)
		5,566			6,477

Other intangibles		2,309			2,309
Arising from business combinations		663			—
Less: Accumulated amortization		(544	)		(154	)
		2,428			2,155

Other intangible assets, net	$	7,994		$	8,632

STOCK-BASED COMPENSATION (Tables)

9 Months Ended

Sep. 30, 2020

STOCK-BASED COMPENSATION [Abstract]

Summary of Stock Option Activity

A summary of activity in the Plan during the nine months ended September 30, 2020 is presented in the table below:

	Number of Shares			Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Life in Years		Aggregate Intrinsic Value
Nine Months Ended September 30, 2020
Outstanding at beginning of year:		1,462,997		$	13.42
Granted		248,966			20.96
Exercised		(27,851	)		10.72
Forfeited		(20,151	)		17.86
Expired		(1,263	)		16.00

Balance, September 30, 2020		1,662,698		$	14.54		5.97	$	1,657

Exercisable at end of period		1,065,753		$	12.11		5.21	$	1,657

Vested at end of period		1,065,753		$	12.11		5.21	$	1,657

Summary of Assumptions Used to Calculate Fair Value of Awards

A summary of assumptions used to calculate the fair values of the awards granted during the periods noted is presented below:

	Nine Months Ended September 30,
	2020			2019
Expected volatility		27.46	%	24.88% to 31.54%
Expected dividend yield		0.70	%		0.70	%
Expected term (years)	6.2 years			0.5 - 7.0 years
Risk-free interest rate		1.44	%	1.46% to 2.63%
Weighted average grant date fair value	$	5.68		$	8.01

Summary of Activity of Restricted Stock Units

A summary of activity in the Plan is presented in the table below:

	Number of Shares			Weighted-Average Grant Date Fair Value
Nine Months Ended September 30, 2020
Outstanding at beginning of year:		81,200		$	19.46
Granted		5,970			20.93
Vested		(24,694	)		19.79
Forfeited		—			—

Balance, September 30, 2020		62,476		$	19.47

COMMITMENTS AND CONTINGENCIES (Tables)

9 Months Ended

Sep. 30, 2020

COMMITMENTS AND CONTINGENCIES [Abstract]

Financial Instrument Whose Contract Amounts Represent Credit Risk Outstanding

Financial instruments whose contract amounts represent credit risk outstanding follow:

	September 30, 2020		December 31, 2019
Commitments to grant loans and unfunded commitments under lines of credit	$	439,633	$	409,969
Standby letters of credit		7,004		10,748

CAPITAL AND REGULATORY MATTERS (Tables)

9 Months Ended

Sep. 30, 2020

CAPITAL AND REGULATORY MATTERS [Abstract]

Actual Capital Amounts and Ratios

The Company and its bank subsidiary’s actual capital amounts and ratios follow:

	Actual					Minimum Required Under BASEL III Fully Phased-In					To Be Well Capitalized Under Prompt Corrective Action Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
September 30, 2020
Total Capital to Risk Weighted Assets:
Consolidated	$	457,689		18.67	%	$	257,444		10.50	%		N/A		N/A
City Bank		394,673		16.10	%		257,430		10.50	%	$	245,171		10.00	%

Tier I Capital to Risk Weighted Assets:
Consolidated		351,303		14.33	%		208,407		8.50	%		N/A		N/A
City Bank		363,834		14.84	%		208,396		8.50	%		196,137		8.00	%

Common Equity Tier 1 to Risk Weighted Assets:
Consolidated		306,303		12.49	%		171,629		7.00	%		N/A		N/A
City Bank		363,834		14.84	%		171,620		7.00	%		159,361		6.50	%

Tier I Capital to Average Assets:
Consolidated		351,303		10.01	%		141,472		4.00	%		N/A		N/A
City Bank		363,834		10.37	%		141,401		4.00	%		175,376		5.00	%

December 31, 2019
Total Capital to Risk Weighted Assets:
Consolidated	$	373,684		14.88	%	$	263,769		10.50	%		N/A		N/A
City Bank		368,322		14.67	%		263,702		10.50	%	$	251,145		10.00	%

Tier I Capital to Risk Weighted Assets:
Consolidated		322,835		12.85	%		213,527		8.50	%		N/A		N/A
City Bank		343,945		13.70	%		213,473		8.50	%		200,916		8.00	%

Common Equity Tier 1 to Risk Weighted Assets:
Consolidated		277,835		11.06	%		175,846		7.00	%		N/A		N/A
City Bank		343,945		13.70	%		175,801		7.00	%		163,244		6.50	%

Tier I Capital to Average Assets:
Consolidated		322,835		10.74	%		120,219		4.00	%		N/A		N/A
City Bank		343,945		11.45	%		121,235		4.00	%		150,175		5.00	%

DERIVATIVES (Tables)

9 Months Ended

Sep. 30, 2020

DERIVATIVES [Abstract]

Fair Value Hedges

The following table reflects the fair value hedges included in the consolidated balance sheets:

	September 30, 2020				December 31, 2019
	Notional Amount		Fair Value		Notional Amount		Fair Value

Included in other liabilities:
Interest rate swaps related to fixed rate loans	$	10,276	$	1,028	$	10,557	$	351

Included in other assets:
Interest rate swaps related to fixed rate loans	$	—	$	—	$	—	$	—

The following table reflects the cash flow hedges included in the consolidated balance sheets:

	September 30, 2020				December 31, 2019
	Notional Amount		Fair Value		Notional Amount		Fair Value

Included in other liabilities:
Cash flow swaps related to state and municipal securities	$	123,760	$	1,643	$	—	$	—

Included in other assets:
Cash flow swaps related to state and municipal securities	$	—	$	—	$	—	$	—

Fair Value of Derivatives in Consolidated Balance Sheets

The following table reflects the amount and fair value of mortgage banking derivatives in the consolidated balance sheets:

	September 30, 2020				December 31, 2019
	Notional Amount		Fair Value		Notional Amount		Fair Value

Included in other assets:
Forward contracts related to mortgage loans held for sale	$	—	$	—	$	—	$	—
Interest rate lock commitments		245,000		6,700		52,875		814

Total included in other assets	$	245,000	$	6,700	$	52,875	$	814

Included in other liabilities:
Forward contracts related to mortgage loans held for sale	$	210,724	$	1,006	$	58,948	$	141
Interest rate lock commitments		—		—		—		—

Total included in other liabilities	$	210,724	$	1,006	$	58,948	$	141

EARNINGS PER SHARE (Tables)

9 Months Ended

Sep. 30, 2020

EARNINGS PER SHARE [Abstract]

Factors Used in Earnings Per Share Computation

The factors used in the earnings per share computation follow:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Net income	$	16,731	$	8,258	$	29,429	$	19,111

Weighted average common shares outstanding - basic		18,059,174		17,985,429		18,054,678		16,417,116
Effect of dilutive securities:
Stock-based compensation awards		196,987		377,604		269,044		160,606
Weighted average common shares outstanding - diluted		18,256,161		18,363,033		18,323,722		16,577,722

Basic earnings per share	$	0.93	$	0.46	$	1.63	$	1.16
Diluted earnings per share	$	0.92	$	0.45	$	1.61	$	1.15

SEGMENT INFORMATION (Tables)

9 Months Ended

Sep. 30, 2020

SEGMENT INFORMATION [Abstract]

Financial Results by Reportable Segment

Financial results by reportable segment are detailed below:

Three Months Ended September 30, 2020	Banking			Insurance			Consolidated
Net interest income	$	31,273		$	—		$	31,273
Provision for loan loss		(6,062	)		—			(6,062	)
Noninterest income		28,393			3,267			31,660
Noninterest expense		(33,984	)		(2,009	)		(35,993	)

Income before income taxes		19,620			1,258			20,878

Income tax (expense) benefit		(3,891	)		(256	)		(4,147	)

Net income	$	15,729		$	1,002		$	16,731

Three Months Ended September 30, 2019	Banking			Insurance			Consolidated
Net interest income	$	26,568		$	—		$	26,568
Provision for loan loss		(420	)		—			(420	)
Noninterest income		13,048			1,067			14,115
Noninterest expense		(29,109	)		(919	)		(30,028	)

Income before income taxes		10,087			148			10,235

Income tax (expense) benefit		(1,945	)		(32	)		(1,977	)

Net income	$	8,142		$	116		$	8,258

Financial results by reportable segment are detailed below:

Nine Months Ended September 30, 2020	Banking			Insurance			Consolidated
Net interest income	$	91,920		$	—		$	91,920
Provision for loan loss		(25,429	)		—			(25,429	)
Noninterest income		70,050			5,381			75,431
Noninterest expense		(100,876	)		(4,335	)		(105,211	)

Income before income taxes		35,665			1,046			36,711

Income tax (expense) benefit		(7,008	)		(274	)		(7,282	)

Net income	$	28,657		$	772		$	29,429

Nine Months Ended September 30, 2019	Banking			Insurance			Consolidated
Net interest income	$	75,951		$	—		$	75,951
Provision for loan loss		(1,903	)		-			(1,903	)
Noninterest income		35,981			3,912			39,893
Noninterest expense		(87,279	)		(2,715	)		(89,994	)

Income before income taxes		22,750			1,197			23,947

Income tax (expense) benefit		(4,674	)		(162	)		(4,836	)

Net income	$	18,076		$	1,035		$	19,111

FAIR VALUE DISCLOSURES (Tables)

9 Months Ended

Sep. 30, 2020

FAIR VALUE DISCLOSURES [Abstract]

Assets (Liabilities) Measured at Fair Value on Recurring and Non-Recurring Basis

The following table summarizes fair value measurements:

	Level 1		Level 2			Level 3		Total
September 30, 2020
Assets (liabilities) measured at fair value on a recurring basis:
Securities available for sale:
U.S. government and agencies	$	—	$	4,785		$	—	$	4,785
State and municipal		5,878		243,952			—		249,830
Mortgage-backed securities		—		325,005			—		325,005
Collateralized mortgage obligations		—		106,777			—		106,777
Asset-backed and other amortizing securities		—		34,927			—		34,927
Other		—		5,005			—		5,005
Loans held for sale (mandatory)		—		60,478			—		60,478
Mortgage servicing rights		—		6,562			—		6,562
Asset derivatives		—		6,700			—		6,700
Liability derivatives		—		(3,677	)		—		(3,677	)

Assets measured at fair value on a non-recurring basis:
Impaired loans		—		—			11,582		11,582
Other real estate owned		—		—			1,336		1,336
Loans held for sale (best efforts)		—		16,029			—		16,029

December 31, 2019
Assets (liabilities) measured at fair value on a recurring basis:
Securities available for sale:
U.S. government and agencies	$	—	$	4,807		$	—	$	4,807
State and municipal		—		94,692			—		94,692
Mortgage-backed securities		—		464,516			—		464,516
Collateralized mortgage obligations		—		107,289			—		107,289
Asset-backed and other amortizing securities		—		36,346			—		36,346
Loans held for sale (mandatory)		—		32,809			—		32,809
Mortgage servicing rights		—		2,054			—		2,054
Asset derivatives		—		814			—		814
Liability derivatives		—		(492	)		—		(492	)

Assets measured at fair value on a non-recurring basis:
Impaired loans		—		—			3,642		3,642
Other real estate owned		—		—			1,883		1,883
Loans held for sale (best efforts)		—		16,226			—		16,226

Quantitative Information about Non-Recurring Level 3 Fair Value Measurements

The following table presents quantitative information about non-recurring Level 3 fair value measurements:

	Fair Value		Valuation Techniques	Unobservable Inputs	Range of Discounts
September 30, 2020
Impaired loans	$	11,582	Third party appraisals or inspections	Collateral discounts and selling costs		0%-100	%
Other real estate owned		1,336	Third party appraisals or inspections	Collateral discounts and selling costs		15%-66	%

December 31, 2019
Impaired loans	$	3,642	Third party appraisals or inspections	Collateral discounts and selling costs		0%-100	%
Other real estate owned		1,883	Third party appraisals or inspections	Collateral discounts and selling costs		15%-66	%

Estimated Fair Values, and Related Carrying Amounts of Financial Instruments

The estimated fair values, and related carrying amounts, of the Company’s financial instruments are as follows:

	Carrying Amount		Level 1		Level 2		Level 3		Total Fair Value

September 30, 2020
Financial assets:
Cash and cash equivalents	$	290,885	$	290,885	$	—	$	—	$	290,885
Loans, net		2,242,158		—		—		2,246,631		2,246,631
Accrued interest receivable		13,632		—		13,632		—		13,632
Bank-owned life insurance		70,401		—		70,401		—		70,401

Financial liabilities:
Deposits	$	2,943,802	$	2,674,130	$	274,768	$	—	$	2,948,898
Accrued interest payable		1,654		—		1,654		—		1,654
Notes payable & other borrowings		75,000		—		75,000		—		75,000
Junior subordinated deferrable interest debentures		46,393		—		46,393		—		46,393
Subordinated debt securities		75,546		—		75,546		—		75,546

	Carrying Amount		Level 1		Level 2		Level 3		Total Fair Value

December 31, 2019
Financial assets:
Cash and cash equivalents	$	158,099	$	158,099	$	—	$	—	$	158,099
Loans, net		2,119,426		—		—		2,123,289		2,123,289
Accrued interest receivable		13,924		—		13,924		—		13,924
Bank-owned life insurance		69,397		—		69,397		—		69,397

Financial liabilities:
Deposits	$	2,696,857	$	2,354,999	$	346,194	$	—	$	2,701,193
Accrued interest payable		2,283		—		2,283		—		2,283
Notes payable & other borrowings		95,000		—		95,000		—		95,000
Junior subordinated deferrable interest debentures		46,393		—		46,393		—		46,393
Subordinated debt securities		26,472		—		26,472		—		26,472

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

+ References + Details

BUSINESS COMBINATIONS (Tables)

9 Months Ended

Sep. 30, 2020

West Texas State Bank [Member]

Business Combinations [Abstract]

Fair Value of the Assets Acquired and Liabilities Assumed

Fair values of the assets acquired and liabilities assumed in this transaction as of the closing date are as follows:

Cash paid	$	76,100

Assets acquired:
Cash and cash equivalents	$	77,903
Interest-bearing time deposits in banks		52,700
Federal funds purchased		26,468
Securities available for sale		68,398
Loans held for investment		195,228
Bank-owned life insurance		10,932
Premises and equipment, net		4,132
Accrued interest receivable		1,114
Core deposit intangible		6,679
Other assets		2,648
Total assets acquired	$	446,202

Liabilities assumed
Deposits	$	386,176
Accrued interest payable		55
Deferred tax liability		762
Other liabilities		2,424
Total liabilities assumed	$	389,417
Net assets acquired	$	56,785
Goodwill recorded in acquisition	$	19,315

Windmark Insurance Agency, Inc. [Member] | Crop Insurance Agency in Nebraska [Member]

Business Combinations [Abstract]

Fair Value of the Assets Acquired and Liabilities Assumed

In June 2020, Windmark acquired the operating assets of a crop insurance agency in Nebraska for $687,000. Fair value of the assets acquired in this transaction as of the closing date are as follows:

Cash paid	$	687

Assets acquired:
Premises and equipment, net	$	24
Customer list		512
Other intangible assets		151
Total assets acquired	$	687

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) $ / shares in Units, $ in Thousands		3 Months Ended	9 Months Ended
	Mar. 11, 2019 $ / shares shares	Sep. 30, 2020 USD ($) $ / shares shares	Sep. 30, 2020 USD ($) $ / shares shares	Dec. 31, 2019 $ / shares shares	Mar. 10, 2019 shares
Change in Capital Structure [Abstract]
Number of shares of common stock authorized (in shares) \| shares	30,000,000	30,000,000	30,000,000	30,000,000	1,000,000
Common stock, par value (in dollars per share) \| $ / shares	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Stock split ratio	29
Loans [Abstract]
Number of days principal or interest payments are past due for loans to be placed on nonaccrual status			90 days
Minimum [Member]
Allowance for Loan Losses [Abstract]
Threshold balance of loan to be specifically reviewed for impairment			$ 250
City Bank [Member] \| Bank Subsidiary [Member]
Subsidiaries Information [Abstract]
Wholly Owned, Consolidated Subsidiaries			City Bank
Windmark Insurance Agency, Inc. ("Windmark") [Member] \| Non-bank Subsidiary [Member]
Subsidiaries Information [Abstract]
Wholly Owned, Consolidated Subsidiaries			Windmark Insurance Agency, Inc. ("Windmark")
Ruidoso Retail, Inc. [Member] \| Non-bank Subsidiary [Member]
Subsidiaries Information [Abstract]
Wholly Owned, Consolidated Subsidiaries			Ruidoso Retail, Inc.
CB Provence, LLC [Member] \| Non-bank Subsidiary [Member]
Subsidiaries Information [Abstract]
Wholly Owned, Consolidated Subsidiaries			CB Provence, LLC
CBT Brushy Creek, LLC [Member] \| Non-bank Subsidiary [Member]
Subsidiaries Information [Abstract]
Wholly Owned, Consolidated Subsidiaries			CBT Brushy Creek, LLC
CBT Properties, LLC [Member] \| Non-bank Subsidiary [Member]
Subsidiaries Information [Abstract]
Wholly Owned, Consolidated Subsidiaries			CBT Properties, LLC
South Plains Financial Capital Trusts (SPFCT) III-V [Member] \| Non-bank Subsidiary [Member]
Subsidiaries Information [Abstract]
Wholly Owned, Equity Method Subsidiaries			South Plains Financial Capital Trusts (SPFCT) III-V
Substandard or Worse [Member] \| Minimum [Member]
Allowance for Loan Losses [Abstract]
Threshold balance of loan to be specifically reviewed for impairment		$ 250
Customer Relationships [Member]
Goodwill and Other Intangible Assets [Abstract]
Estimated useful lives			5 years
Employment Agreements [Member]
Goodwill and Other Intangible Assets [Abstract]
Estimated useful lives			5 years
Core Deposits Intangible [Member] \| Maximum [Member]
Goodwill and Other Intangible Assets [Abstract]
Estimated useful lives			10 years

SECURITIES, Available for Sale (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Available for sale [Abstract]
Amortized cost	$ 700,850	$ 706,437
Gross unrealized gains	26,384	5,412
Gross unrealized losses	(905)	(4,199)
Fair value	726,329	707,650
U.S. Government and Agencies [Member]
Available for sale [Abstract]
Amortized cost	4,750	4,750
Gross unrealized gains	35	57
Gross unrealized losses	0	0
Fair value	4,785	4,807
State and Municipal [Member]
Available for sale [Abstract]
Amortized cost	242,010	94,512
Gross unrealized gains	8,248	1,091
Gross unrealized losses	(428)	(911)
Fair value	249,830	94,692
Mortgage-backed Securities [Member]
Available for sale [Abstract]
Amortized cost	309,227	463,899
Gross unrealized gains	15,778	3,727
Gross unrealized losses	0	(3,110)
Fair value	325,005	464,516
Collateralized Mortgage Obligations [Member]
Available for sale [Abstract]
Amortized cost	107,249	107,443
Gross unrealized gains	0	15
Gross unrealized losses	(472)	(169)
Fair value	106,777	107,289
Asset-backed and Other Amortizing Securities [Member]
Available for sale [Abstract]
Amortized cost	32,614	35,833
Gross unrealized gains	2,313	522
Gross unrealized losses	0	(9)
Fair value	34,927	$ 36,346
Other Securities [Member]
Available for sale [Abstract]
Amortized cost	5,000
Gross unrealized gains	10
Gross unrealized losses	(5)
Fair value	$ 5,005

SECURITIES, Amortized Cost and Fair Value of Securities by Contractual Maturity (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Available for Sale, Amortized Cost [Abstract]
Within 1 year	$ 5,760
After 1 year through 5 years	1,246
After 5 years through 10 years	20,825
After 10 years	223,930
Other	449,089
Amortized cost	700,850	$ 706,437
Available for Sale, Fair Value [Abstract]
Within 1 year	5,800
After 1 year through 5 years	1,343
After 5 years through 10 years	21,658
After 10 years	230,820
Other	466,708
Fair value	$ 726,329	$ 707,650

SECURITIES, Securities Transferred and Securities Pledged (Details) $ in Millions	9 Months Ended	12 Months Ended
	Sep. 30, 2020 USD ($) Security	Dec. 31, 2019 USD ($) Security
SECURITIES [Abstract]
Holdings of securities of any one issuer, other than the U.S. government and its agencies, in an amount greater than 10% of stockholders' equity \| Security	0	0
Carrying value of securities pledged to collateralize public deposits and for other purposes \| $	$ 260.0	$ 211.0

SECURITIES, Securities with Unrealized Losses, Available for Sale (Details) $ in Thousands	Sep. 30, 2020 USD ($) Security	Dec. 31, 2019 USD ($)
Available for sale, Fair Value [Abstract]
Less than 12 months	$ 144,652	$ 405,209
12 months or more	0	5,048
Total	144,652	410,257
Available for sale, Unrealized Loss [Abstract]
Less than 12 months	905	4,158
12 months or more	0	41
Total	$ 905	4,199
Number of securities with an unrealized loss \| Security	8
U.S. Government and Agencies [Member]
Available for sale, Fair Value [Abstract]
Less than 12 months	$ 0	0
12 months or more	0	0
Total	0	0
Available for sale, Unrealized Loss [Abstract]
Less than 12 months	0	0
12 months or more	0	0
Total	0	0
State and Municipal [Member]
Available for sale, Fair Value [Abstract]
Less than 12 months	34,380	58,389
12 months or more	0	387
Total	34,380	58,776
Available for sale, Unrealized Loss [Abstract]
Less than 12 months	428	910
12 months or more	0	1
Total	428	911
Mortgage-backed Securities [Member]
Available for sale, Fair Value [Abstract]
Less than 12 months	0	284,120
12 months or more	0	4,661
Total	0	288,781
Available for sale, Unrealized Loss [Abstract]
Less than 12 months	0	3,070
12 months or more	0	40
Total	0	3,110
Collateralized Mortgage Obligations [Member]
Available for sale, Fair Value [Abstract]
Less than 12 months	106,777	60,039
12 months or more	0	0
Total	106,777	60,039
Available for sale, Unrealized Loss [Abstract]
Less than 12 months	472	169
12 months or more	0	0
Total	472	169
Asset-backed and Other Amortizing Securities [Member]
Available for sale, Fair Value [Abstract]
Less than 12 months	3,495	2,661
12 months or more	0	0
Total	3,495	2,661
Available for sale, Unrealized Loss [Abstract]
Less than 12 months	5	9
12 months or more	0	0
Total	$ 5	$ 9

LOANS HELD FOR INVESTMENT, Summary of Loans by Category (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2020 USD ($) Category	Jun. 30, 2020 USD ($)	Dec. 31, 2019 USD ($)	Sep. 30, 2019 USD ($)	Jun. 30, 2019 USD ($)	Dec. 31, 2018 USD ($)
Summary of Loans by Category [Abstract]
Loans, gross	$ 2,288,234		$ 2,143,623
Allowance for loan losses	(46,076)	$ (40,635)	(24,197)	$ (24,176)	$ (24,171)	$ (23,126)
Loans, net	2,242,158		2,119,426
Commercial Real Estate [Member]
Summary of Loans by Category [Abstract]
Loans, gross	655,432		658,195
Allowance for loan losses	$ (18,264)	(15,156)	(5,049)	(5,144)	(5,415)	(5,579)
Commercial [Member]
Summary of Loans by Category [Abstract]
Number of sub-categories of loans \| Category	2
Commercial [Member] \| Specialized [Member]
Summary of Loans by Category [Abstract]
Loans, gross	$ 340,458		309,505
Allowance for loan losses	(6,304)	(6,614)	(2,287)	(2,799)	(3,346)	(2,516)
Commercial [Member] \| General [Member]
Summary of Loans by Category [Abstract]
Loans, gross	578,181		441,398
Allowance for loan losses	(9,989)	(9,293)	(9,609)	(8,908)	(8,325)	(8,173)
Consumer [Member] \| 1-4 Family Residential [Member]
Summary of Loans by Category [Abstract]
Loans, gross	372,114		362,796
Allowance for loan losses	(4,684)	(2,926)	(2,093)	(2,638)	(2,310)	(2,249)
Consumer [Member] \| Auto Loans [Member]
Summary of Loans by Category [Abstract]
Loans, gross	193,023		215,209
Allowance for loan losses	(4,233)	(3,939)	(3,385)	(3,017)	(3,067)	(2,994)
Consumer [Member] \| Other Consumer [Member]
Summary of Loans by Category [Abstract]
Loans, gross	68,877		74,000
Allowance for loan losses	(1,727)	(1,640)	(1,341)	(1,153)	(1,199)	(1,192)
Construction [Member]
Summary of Loans by Category [Abstract]
Loans, gross	80,149		82,520
Allowance for loan losses	$ (875)	$ (1,067)	$ (433)	$ (517)	$ (509)	$ (423)

LOANS HELD FOR INVESTMENT, Activity in Allowance for Loan Losses (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
LOANS HELD FOR INVESTMENT [Abstract]
Percentage of allowance for loan losses to loans held for investment	2.01%		2.01%		1.13%
Allowance for Loan Losses [Roll Forward]
Beginning Balance	$ 40,635	$ 24,171	$ 24,197	$ 23,126
Provision for loan losses	6,062	420	25,429	1,903
Charge-offs	(1,011)	(725)	(4,694)	(1,940)
Recoveries	390	310	1,144	1,087
Ending Balance	46,076	24,176	46,076	24,176
Commercial Real Estate [Member]
Allowance for Loan Losses [Roll Forward]
Beginning Balance	15,156	5,415	5,049	5,579
Provision for loan losses	3,085	(379)	12,977	(758)
Charge-offs	0	0	0	0
Recoveries	23	108	238	323
Ending Balance	18,264	5,144	18,264	5,144
Commercial [Member] \| Specialized [Member]
Allowance for Loan Losses [Roll Forward]
Beginning Balance	6,614	3,346	2,287	2,516
Provision for loan losses	(220)	(575)	4,870	230
Charge-offs	(109)	0	(959)	(37)
Recoveries	19	28	106	90
Ending Balance	6,304	2,799	6,304	2,799
Commercial [Member] \| General [Member]
Allowance for Loan Losses [Roll Forward]
Beginning Balance	9,293	8,325	9,609	8,173
Provision for loan losses	977	734	1,952	674
Charge-offs	(372)	(170)	(1,752)	(235)
Recoveries	91	19	180	296
Ending Balance	9,989	8,908	9,989	8,908
Consumer [Member] \| 1-4 Family Residential [Member]
Allowance for Loan Losses [Roll Forward]
Beginning Balance	2,926	2,310	2,093	2,249
Provision for loan losses	1,688	384	2,520	412
Charge-offs	(56)	(65)	(56)	(84)
Recoveries	126	9	127	61
Ending Balance	4,684	2,638	4,684	2,638
Consumer [Member] \| Auto Loans [Member]
Allowance for Loan Losses [Roll Forward]
Beginning Balance	3,939	3,067	3,385	2,994
Provision for loan losses	474	127	1,624	626
Charge-offs	(212)	(260)	(916)	(765)
Recoveries	32	83	140	162
Ending Balance	4,233	3,017	4,233	3,017
Consumer [Member] \| Other Consumer [Member]
Allowance for Loan Losses [Roll Forward]
Beginning Balance	1,640	1,199	1,341	1,192
Provision for loan losses	250	121	1,045	550
Charge-offs	(262)	(230)	(1,011)	(744)
Recoveries	99	63	352	155
Ending Balance	1,727	1,153	1,727	1,153
Construction [Member]
Allowance for Loan Losses [Roll Forward]
Beginning Balance	1,067	509	433	423
Provision for loan losses	(192)	8	441	169
Charge-offs	0	0	0	(75)
Recoveries	0	0	1	0
Ending Balance	$ 875	$ 517	$ 875	$ 517

LOANS HELD FOR INVESTMENT, Investment in loans Disaggregated Based on Method of Evaluating Impairment (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Recorded Investment [Abstract]
Individually Evaluated	$ 13,646	$ 4,167
Collectively Evaluated	2,274,588	2,139,456
Allowance for Loan Losses [Abstract]
Individually Evaluated	2,064	525
Collectively Evaluated	44,012	23,672
Commercial Real Estate [Member]
Recorded Investment [Abstract]
Individually Evaluated	4,339	299
Collectively Evaluated	651,093	657,896
Allowance for Loan Losses [Abstract]
Individually Evaluated	260	0
Collectively Evaluated	18,004	5,049
Commercial [Member] \| Specialized [Member]
Recorded Investment [Abstract]
Individually Evaluated	0	573
Collectively Evaluated	340,458	308,932
Allowance for Loan Losses [Abstract]
Individually Evaluated	0	0
Collectively Evaluated	6,304	2,287
Commercial [Member] \| General [Member]
Recorded Investment [Abstract]
Individually Evaluated	7,071	1,396
Collectively Evaluated	571,110	440,002
Allowance for Loan Losses [Abstract]
Individually Evaluated	1,734	525
Collectively Evaluated	8,255	9,084
Consumer [Member] \| 1-4 Family Residential [Member]
Recorded Investment [Abstract]
Individually Evaluated	2,236	1,899
Collectively Evaluated	369,878	360,897
Allowance for Loan Losses [Abstract]
Individually Evaluated	70	0
Collectively Evaluated	4,614	2,093
Consumer [Member] \| Auto Loans [Member]
Recorded Investment [Abstract]
Individually Evaluated	0	0
Collectively Evaluated	193,023	215,209
Allowance for Loan Losses [Abstract]
Individually Evaluated	0	0
Collectively Evaluated	4,233	3,385
Consumer [Member] \| Other Consumer [Member]
Recorded Investment [Abstract]
Individually Evaluated	0	0
Collectively Evaluated	68,877	74,000
Allowance for Loan Losses [Abstract]
Individually Evaluated	0	0
Collectively Evaluated	1,727	1,341
Construction [Member]
Recorded Investment [Abstract]
Individually Evaluated	0	0
Collectively Evaluated	80,149	82,520
Allowance for Loan Losses [Abstract]
Individually Evaluated	0	0
Collectively Evaluated	$ 875	$ 433

LOANS HELD FOR INVESTMENT, Impaired Loan Information (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2020	Dec. 31, 2019
Impaired Loan Information [Abstract]
Unpaid Contractual Principal Balance	$ 14,065	$ 5,484
Recorded Investment With No Allowance	8,492	2,771
Recorded Investment With Allowance	5,154	1,396
Total Recorded Investment	13,646	4,167
Related Allowance	2,064	525
Average Recorded Investment	10,206	6,764
Minimum [Member]
Impaired Loan Information [Abstract]
Threshold balance of loan to be specifically reviewed for impairment	250
Commercial Real Estate [Member]
Impaired Loan Information [Abstract]
Unpaid Contractual Principal Balance	4,339	754
Recorded Investment With No Allowance	3,380	299
Recorded Investment With Allowance	959	0
Total Recorded Investment	4,339	299
Related Allowance	260	0
Average Recorded Investment	2,699	1,059
Commercial [Member] \| Specialized [Member]
Impaired Loan Information [Abstract]
Unpaid Contractual Principal Balance	0	573
Recorded Investment With No Allowance	0	573
Recorded Investment With Allowance	0	0
Total Recorded Investment	0	573
Related Allowance	0	0
Average Recorded Investment	673	1,345
Commercial [Member] \| General [Member]
Impaired Loan Information [Abstract]
Unpaid Contractual Principal Balance	7,071	1,839
Recorded Investment With No Allowance	3,298	0
Recorded Investment With Allowance	3,773	1,396
Total Recorded Investment	7,071	1,396
Related Allowance	1,734	525
Average Recorded Investment	4,622	2,173
Consumer [Member] \| 1-4 Family [Member]
Impaired Loan Information [Abstract]
Unpaid Contractual Principal Balance	2,655	2,318
Recorded Investment With No Allowance	1,814	1,899
Recorded Investment With Allowance	422	0
Total Recorded Investment	2,236	1,899
Related Allowance	70	0
Average Recorded Investment	2,212	2,187
Consumer [Member] \| Auto Loans [Member]
Impaired Loan Information [Abstract]
Unpaid Contractual Principal Balance	0	0
Recorded Investment With No Allowance	0	0
Recorded Investment With Allowance	0	0
Total Recorded Investment	0	0
Related Allowance	0	0
Average Recorded Investment	0	0
Consumer [Member] \| Other Consumer [Member]
Impaired Loan Information [Abstract]
Unpaid Contractual Principal Balance	0	0
Recorded Investment With No Allowance	0	0
Recorded Investment With Allowance	0	0
Total Recorded Investment	0	0
Related Allowance	0	0
Average Recorded Investment	0	0
Construction [Member]
Impaired Loan Information [Abstract]
Unpaid Contractual Principal Balance	0	0
Recorded Investment With No Allowance	0	0
Recorded Investment With Allowance	0	0
Total Recorded Investment	0	0
Related Allowance	0	0
Average Recorded Investment	$ 0	$ 0

LOANS HELD FOR INVESTMENT, Age Analysis on Accruing Past-due Loans and Nonaccrual Loans (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2020 USD ($) Point	Dec. 31, 2019 USD ($)
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Nonaccrual	$ 13,067	$ 4,693
Number of points on a grading scale for loans \| Point	13
30-89 Days Past Due [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Past Due	$ 6,105	7,179
90 Days or More Past Due [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Past Due	1,939	1,352
Commercial Real Estate [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Nonaccrual	4,382	162
Commercial Real Estate [Member] \| 30-89 Days Past Due [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Past Due	2,846	37
Commercial Real Estate [Member] \| 90 Days or More Past Due [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Past Due	0	116
Commercial [Member] \| Specialized [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Nonaccrual	205	1,172
Commercial [Member] \| Specialized [Member] \| 30-89 Days Past Due [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Past Due	304	708
Commercial [Member] \| Specialized [Member] \| 90 Days or More Past Due [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Past Due	0	0
Commercial [Member] \| General [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Nonaccrual	7,638	2,254
Commercial [Member] \| General [Member] \| 30-89 Days Past Due [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Past Due	406	1,747
Commercial [Member] \| General [Member] \| 90 Days or More Past Due [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Past Due	0	0
Consumer [Member] \| 1-4 Family Residential [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Nonaccrual	789	1,105
Consumer [Member] \| 1-4 Family Residential [Member] \| 30-89 Days Past Due [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Past Due	1,203	1,212
Consumer [Member] \| 1-4 Family Residential [Member] \| 90 Days or More Past Due [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Past Due	1,851	932
Consumer [Member] \| Auto Loans [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Nonaccrual	0	0
Consumer [Member] \| Auto Loans [Member] \| 30-89 Days Past Due [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Past Due	567	1,468
Consumer [Member] \| Auto Loans [Member] \| 90 Days or More Past Due [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Past Due	73	183
Consumer [Member] \| Other Consumer [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Nonaccrual	53	0
Consumer [Member] \| Other Consumer [Member] \| 30-89 Days Past Due [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Past Due	779	848
Consumer [Member] \| Other Consumer [Member] \| 90 Days or More Past Due [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Past Due	15	121
Construction [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Nonaccrual	0	0
Construction [Member] \| 30-89 Days Past Due [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Past Due	0	1,159
Construction [Member] \| 90 Days or More Past Due [Member]
Age Analysis on Accruing Past-due Loans and Nonaccrual Loans [Abstract]
Past Due	$ 0	$ 0

LOANS HELD FOR INVESTMENT, COVID-19 Related Deferral and Modification (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2020 USD ($) Loan	Dec. 31, 2019 USD ($)
CARES Act [Abstract]
Troubled debt restructurings	$ 0	$ 0
Covid-19 [Member]
CARES Act [Abstract]
Percentage of loans modified under CARES Act	3.07%
Number of outstanding loans subject to deferral and modification agreements \| Loan	23
Amount of outstanding loans subject to deferral and modification agreements	$ 70,200
Covid-19 [Member] \| Short-term Deferral Modification Program [Member]
CARES Act [Abstract]
Amount of outstanding principal balance of loans modified under CARES Act	$ 53,800
Percentage of loans modified under CARES Act	2.35%
Commercial [Member] \| Covid-19 [Member] \| Short-term Deferral Modification Program [Member] \| Interest-Only Payment [Member]
CARES Act [Abstract]
Amount of outstanding principal balance of loans modified under CARES Act	$ 44,200
Period of loan modification	6 months
Commercial [Member] \| Covid-19 [Member] \| Short-term Deferral Modification Program [Member] \| Payment Deferrals [Member]
CARES Act [Abstract]
Amount of outstanding principal balance of loans modified under CARES Act	$ 8,200
Period of loan modification	90 days
Consumer [Member] \| Covid-19 [Member] \| Short-term Deferral Modification Program [Member] \| Payment Deferrals [Member]
CARES Act [Abstract]
Amount of outstanding principal balance of loans modified under CARES Act	$ 1,400
Consumer [Member] \| Covid-19 [Member] \| Short-term Deferral Modification Program [Member] \| Payment Deferrals [Member] \| Minimum [Member]
CARES Act [Abstract]
Period of loan modification	1 month
Consumer [Member] \| Covid-19 [Member] \| Short-term Deferral Modification Program [Member] \| Payment Deferrals [Member] \| Maximum [Member]
CARES Act [Abstract]
Period of loan modification	4 months

GOODWILL AND INTANGIBLES (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
GOODWILL AND INTANGIBLES (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Goodwill and Other Intangible Assets [Abstract]
Beginning goodwill	$ 18,757	$ 0
Arising from business combinations	0	18,757
Measurement period acquisition adjustment	751	0
Ending goodwill	19,508	18,757
Amortized Intangible Assets [Abstract]
Other intangible assets, net	7,994	8,632
Customer Relationship Intangibles [Member]
Amortized Intangible Assets [Abstract]
Other intangible assets, gross	6,679	6,679
Less: Accumulated amortization	(1,113)	(202)
Other intangible assets, net	5,566	6,477
Other Intangibles [Member]
Amortized Intangible Assets [Abstract]
Other intangible assets, gross	2,309	2,309
Arising from business combinations	663	0
Less: Accumulated amortization	(544)	(154)
Other intangible assets, net	$ 2,428	$ 2,155

BORROWING ARRANGEMENTS (Details) - USD ($) $ in Thousands	1 Months Ended	9 Months Ended
BORROWING ARRANGEMENTS (Details) - USD ($) $ in Thousands	Jul. 31, 2020	Sep. 30, 2020	Sep. 30, 2019	Sep. 29, 2020	Apr. 30, 2020	Dec. 31, 2018
Subordinated Debt Securities [Abstract]
Payments made on notes payable and other borrowings		$ 95,000	$ 7,530
Subordinated Debt Securities Issued in December 2018 [Member]
Subordinated Debt Securities [Abstract]
Debt instrument, face amount						$ 26,500
Subordinated Debt Securities Issued in December 2018 [Member] \| Debt Securities One [Member]
Subordinated Debt Securities [Abstract]
Debt instrument, face amount						$ 12,400
Debt instrument, maturity date		Dec. 31, 2028
Debt instrument, initial interest rate						5.74%
Debt instrument, period of fixed interest rate		5 years
Debt instrument, variable interest rate, floor		4.50%
Debt instrument, variable interest rate, ceiling		7.50%
Subordinated Debt Securities Issued in December 2018 [Member] \| Debt Securities One [Member] \| Maximum [Member]
Subordinated Debt Securities [Abstract]
Remaining maturity period during which debt can be called		5 years
Subordinated Debt Securities Issued in December 2018 [Member] \| Debt Securities Two [Member]
Subordinated Debt Securities [Abstract]
Debt instrument, face amount						$ 14,100
Debt instrument, maturity date		Dec. 31, 2030
Debt instrument, initial interest rate						6.41%
Debt instrument, period of fixed interest rate		7 years
Debt instrument, variable interest rate, floor		4.50%
Debt instrument, variable interest rate, ceiling		7.50%
Subordinated Debt Securities Issued in December 2018 [Member] \| Debt Securities Two [Member] \| Maximum [Member]
Subordinated Debt Securities [Abstract]
Remaining maturity period during which debt can be called		5 years
Subordinated Debt Securities Issued in September 29, 2020 [Member]
Subordinated Debt Securities [Abstract]
Debt instrument, face amount				$ 50,000
Debt issuance cost				$ 926
Debt instrument, maturity date		Sep. 30, 2030
Debt instrument, initial interest rate				4.50%
Debt instrument, period of fixed interest rate		5 years
Subordinated Debt Securities Issued in September 29, 2020 [Member] \| SOFR [Member]
Subordinated Debt Securities [Abstract]
Term of variable rate		3 months
Basis spread on variable rate		4.38%
Subordinated Debt Securities Issued in September 29, 2020 [Member] \| Maximum [Member]
Subordinated Debt Securities [Abstract]
Remaining maturity period during which debt can be called		5 years
Short-Term Federal Home Loan Bank Advances [Member]
Subordinated Debt Securities [Abstract]
Debt instrument, maturity date		Jul. 31, 2020
Amount borrowed from FHLB for liquidity needs associated with funding Paycheck Protection Program loans					$ 75,000
Debt instrument, term		3 months
Payments made on notes payable and other borrowings	$ 75,000
Long-Term Federal Home Loan Bank Advances [Member]
Subordinated Debt Securities [Abstract]
Debt instrument, maturity date		Jul. 31, 2020
Payments made on notes payable and other borrowings	$ 20,000

STOCK-BASED COMPENSATION (Details) - 2019 Equity Incentive Plan [Member]	Mar. 06, 2019 shares
Equity Incentive Plan [Abstract]
Maximum aggregate number of shares of common stock that may be issued (in shares)	2,300,000
Maximum [Member]
Equity Incentive Plan [Abstract]
Annual increase in number of shares that may be issued	3.00%

STOCK-BASED COMPENSATION, Stock Options Activity (Details) - 2019 Equity Incentive Plan [Member] - Stock Option [Member] - USD ($) $ / shares in Units, $ in Thousands	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Number of Shares [Roll Forward]
Outstanding at beginning of year (in shares)	1,462,997
Granted (in shares)	248,966
Exercised (in shares)	(27,851)	0
Forfeited (in shares)	(20,151)
Expired (in shares)	(1,263)
Balance at end of period (in shares)	1,662,698
Exercisable at end of period (in shares)	1,065,753
Vested at end of period (in shares)	1,065,753
Weighted-Average Exercise Price [Abstract]
Outstanding at beginning of year (in dollars per share)	$ 13.42
Granted (in dollars per share)	20.96
Exercised (in dollars per share)	10.72
Forfeited (in dollars per share)	17.86
Expired (in dollars per share)	16.00
Balance at end of period (in dollars per share)	14.54
Exercisable at end of period (in dollars per share)	12.11
Vested at end of period (in dollars per share)	$ 12.11
Weighted Average Remaining Contractual Life in Years [Abstract]
Options Outstanding	5 years 11 months 19 days
Exercisable at end of period	5 years 2 months 16 days
Vested at end of period	5 years 2 months 16 days
Aggregate Intrinsic Value [Abstract]
Balance at end of period	$ 1,657
Exercisable at end of period	1,657
Vested at end of period	$ 1,657

STOCK-BASED COMPENSATION, Fair Value Assumptions (Details) - USD ($) $ / shares in Units, $ in Thousands		9 Months Ended
	May 06, 2019	Sep. 30, 2020	Sep. 30, 2019
Equity Incentive Plan [Abstract]
Stock option modified from liabilities to equity (in shares)	750,000
Fair value of stock options after modification	$ 11,200
Amount reclassified from liabilities to equity in conversion	11,500
Minimum [Member]
Equity Incentive Plan [Abstract]
Expiration period of options with accelerated vesting due to modification from liabilities to equity		2 years
Maximum [Member]
Equity Incentive Plan [Abstract]
Expiration period of options with accelerated vesting due to modification from liabilities to equity		4 years
Stock Appreciation Rights (SARs) [Member]
Equity Incentive Plan [Abstract]
Fair value of share-based equity awards at conversion date	$ 11,500
Stock Option [Member]
Summary of Assumptions Used to Calculate Fair Value of Awards [Abstract]
Expected volatility		27.46%
Expected dividend yield		0.70%	0.70%
Expected term		6 years 2 months 12 days
Risk-free interest rate		1.44%
Weighted average grant date fair value (in dollars per share)		$ 5.68	$ 8.01
Stock Option [Member] \| Minimum [Member]
Summary of Assumptions Used to Calculate Fair Value of Awards [Abstract]
Expected volatility			24.88%
Expected term			6 months
Risk-free interest rate			1.46%
Stock Option [Member] \| Maximum [Member]
Summary of Assumptions Used to Calculate Fair Value of Awards [Abstract]
Expected volatility			31.54%
Expected term			7 years
Risk-free interest rate			2.63%
2019 Equity Incentive Plan [Member] \| Stock Appreciation Rights (SARs) [Member]
Equity Incentive Plan [Abstract]
Number of outstanding shares converted (in shares)	1,401,000
2019 Equity Incentive Plan [Member] \| Stock Option [Member]
Equity Incentive Plan [Abstract]
Intrinsic value of options exercised		$ 185
Options exercised (in shares)		27,851	0

STOCK-BASED COMPENSATION, Restricted Stock Units (Details) - Restricted Stock Units [Member] - USD ($) $ / shares in Units, $ in Thousands	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Number of Shares [Roll Forward]
Outstanding at beginning of year (in shares)	81,200
Granted (in shares)	5,970
Vested (in shares)	(24,694)
Forfeited (in shares)	0
Balance at ending of period (in shares)	62,476
Weighted-Average Exercise Price [Abstract]
Outstanding at beginning of year (in dollars per share)	$ 19.46
Granted (in dollars per share)	20.93
Vested (in dollars per share)	19.79
Forfeited (in dollars per share)	0
Balance at ending of period (in dollars per share)	$ 19.47
Award vesting period	5 years
Unrecognized compensation cost	$ 3,100
Weighted average remaining period, recognition of compensation cost	1 year 9 months 14 days
Fair value of restricted stock units vested	$ 489
Vested at end of period (in shares)		0

COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
FHLB Letters of Credit [Abstract]
Letters of credit outstanding balance	$ 199,000	$ 199,000
Commitments to Grant Loans and Unfunded Commitments Under Lines of Credit [Member]
Financial instruments with off-balance-sheet risk [Abstract]
Financial instruments whose contract amounts represent credit risk outstanding	439,633	409,969
Standby Letters of Credit [Member]
Financial instruments with off-balance-sheet risk [Abstract]
Financial instruments whose contract amounts represent credit risk outstanding	$ 7,004	$ 10,748

CAPITAL AND REGULATORY MATTERS (Details) $ in Thousands	Sep. 30, 2020 USD ($)	Dec. 31, 2019 USD ($)
Consolidated [Member]
Total Capital to Risk Weighted Assets [Abstract]
Actual, Amount	$ 457,689	$ 373,684
Actual, Ratio	0.1867	0.1488
Minimum Required Under BASEL III Fully Phased-In, Amount	$ 257,444	$ 263,769
Minimum Required Under BASEL III Fully Phased-In, Ratio	0.1050	0.1050
Tier I Capital to Risk Weighted Assets [Abstract]
Actual, Amount	$ 351,303	$ 322,835
Actual, Ratio	0.1433	0.1285
Minimum Required Under BASEL III Fully Phased-In, Amount	$ 208,407	$ 213,527
Minimum Required Under BASEL III Fully Phased-In, Ratio	0.0850	0.0850
Common Equity Tier 1 to Risk Weighted Assets [Abstract]
Actual, Amount	$ 306,303	$ 277,835
Actual, Ratio	0.1249	0.1106
Minimum Required Under BASEL III Fully Phased-In, Amount	$ 171,629	$ 175,846
Minimum Required Under BASEL III Fully Phased-In, Ratio	0.0700	0.0700
Tier I Capital to Average Assets [Abstract]
Actual, Amount	$ 351,303	$ 322,835
Actual, Ratio	0.1001	0.1074
Minimum Required Under BASEL III Fully Phased-In, Amount	$ 141,472	$ 120,219
Minimum Required Under BASEL III Fully Phased-In, Ratio	0.0400	0.0400
City Bank [Member]
Total Capital to Risk Weighted Assets [Abstract]
Actual, Amount	$ 394,673	$ 368,322
Actual, Ratio	0.1610	0.1467
Minimum Required Under BASEL III Fully Phased-In, Amount	$ 257,430	$ 263,702
Minimum Required Under BASEL III Fully Phased-In, Ratio	0.1050	0.1050
To Be Well Capitalized Under Prompt Corrective Action Provisions, Amount	$ 245,171	$ 251,145
To Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio	0.1000	0.1000
Tier I Capital to Risk Weighted Assets [Abstract]
Actual, Amount	$ 363,834	$ 343,945
Actual, Ratio	0.1484	0.1370
Minimum Required Under BASEL III Fully Phased-In, Amount	$ 208,396	$ 213,473
Minimum Required Under BASEL III Fully Phased-In, Ratio	0.0850	0.0850
To Be Well Capitalized Under Prompt Corrective Action Provisions, Amount	$ 196,137	$ 200,916
To Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio	0.0800	0.0800
Common Equity Tier 1 to Risk Weighted Assets [Abstract]
Actual, Amount	$ 363,834	$ 343,945
Actual, Ratio	0.1484	0.1370
Minimum Required Under BASEL III Fully Phased-In, Amount	$ 171,620	$ 175,801
Minimum Required Under BASEL III Fully Phased-In, Ratio	0.0700	0.0700
To Be Well Capitalized Under Prompt Corrective Action Provisions, Amount	$ 159,361	$ 163,244
To Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio	0.0650	0.0650
Tier I Capital to Average Assets [Abstract]
Actual, Amount	$ 363,834	$ 343,945
Actual, Ratio	0.1037	0.1145
Minimum Required Under BASEL III Fully Phased-In, Amount	$ 141,401	$ 121,235
Minimum Required Under BASEL III Fully Phased-In, Ratio	0.0400	0.0400
To Be Well Capitalized Under Prompt Corrective Action Provisions, Amount	$ 175,376	$ 150,175
To Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio	0.0500	0.0500

DERIVATIVES (Details) - Fair Value Hedging [Member] - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Interest Rate Swaps [Member] \| Other Liabilities [Member]
Fair value hedges included in Consolidated Balance Sheets [Abstract]
Derivative liability, notional amount	$ 10,276	$ 10,557
Derivative liability, fair value	1,028	351
Interest Rate Swaps [Member] \| Other Assets [Member]
Fair value hedges included in Consolidated Balance Sheets [Abstract]
Derivative asset, notional amount	0	0
Derivative asset, fair value	0	0
Cash Flow Swaps [Member] \| Other Liabilities [Member]
Fair value hedges included in Consolidated Balance Sheets [Abstract]
Derivative liability, notional amount	123,760	0
Derivative liability, fair value	1,643	0
Cash Flow Swaps [Member] \| Other Assets [Member]
Fair value hedges included in Consolidated Balance Sheets [Abstract]
Derivative asset, notional amount	0	0
Derivative asset, fair value	$ 0	$ 0

DERIVATIVES, Mortgage Banking Derivatives (Details) - Mortgage Banking [Member] - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Other Assets [Member]
Notional amount and fair value of mortgage banking derivatives in Consolidated Balance Sheets [Abstract]
Derivative asset, notional amount	$ 245,000	$ 52,875
Derivative asset, fair value	6,700	814
Other Liabilities [Member]
Notional amount and fair value of mortgage banking derivatives in Consolidated Balance Sheets [Abstract]
Derivative liability, notional amount	210,724	58,948
Derivative liability, fair value	1,006	141
Forward Contracts [Member] \| Other Assets [Member]
Notional amount and fair value of mortgage banking derivatives in Consolidated Balance Sheets [Abstract]
Derivative asset, notional amount	0	0
Derivative asset, fair value	0	0
Forward Contracts [Member] \| Other Liabilities [Member]
Notional amount and fair value of mortgage banking derivatives in Consolidated Balance Sheets [Abstract]
Derivative liability, notional amount	210,724	58,948
Derivative liability, fair value	1,006	141
Interest Rate Lock Commitments [Member] \| Other Assets [Member]
Notional amount and fair value of mortgage banking derivatives in Consolidated Balance Sheets [Abstract]
Derivative asset, notional amount	245,000	52,875
Derivative asset, fair value	6,700	814
Interest Rate Lock Commitments [Member] \| Other Liabilities [Member]
Notional amount and fair value of mortgage banking derivatives in Consolidated Balance Sheets [Abstract]
Derivative liability, notional amount	0	0
Derivative liability, fair value	$ 0	$ 0

EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Basic [Abstract]
Net income	$ 16,731	$ 8,258	$ 29,429	$ 19,111
Weighted average common shares outstanding - basic (in shares)	18,059,174	17,985,429	18,054,678	16,417,116
Effect of dilutive securities [Abstract]
Stock-based compensation awards (in shares)	196,987	377,604	269,044	160,606
Weighted average common shares outstanding - diluted (in shares)	18,256,161	18,363,033	18,323,722	16,577,722
Basic earnings per share (in dollars per share)	$ 0.93	$ 0.46	$ 1.63	$ 1.16
Diluted earnings per share (in dollars per share)	$ 0.92	$ 0.45	$ 1.61	$ 1.15

- Definition

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

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- Definition

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

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- Definition

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

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+ Details

SEGMENT INFORMATION (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
SEGMENT INFORMATION (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Financial results by reportable segments [Abstract]
Net interest income	$ 31,273	$ 26,568	$ 91,920	$ 75,951
Provision for loan loss	(6,062)	(420)	(25,429)	(1,903)
Noninterest income	31,660	14,115	75,431	39,893
Noninterest expense	(35,993)	(30,028)	(105,211)	(89,994)
Income before income taxes	20,878	10,235	36,711	23,947
Income tax (expense) benefit	(4,147)	(1,977)	(7,282)	(4,836)
Net income	16,731	8,258	29,429	19,111
Banking [Member] \| Operating Segments [Member]
Financial results by reportable segments [Abstract]
Net interest income	31,273	26,568	91,920	75,951
Provision for loan loss	(6,062)	(420)	(25,429)	(1,903)
Noninterest income	28,393	13,048	70,050	35,981
Noninterest expense	(33,984)	(29,109)	(100,876)	(87,279)
Income before income taxes	19,620	10,087	35,665	22,750
Income tax (expense) benefit	(3,891)	(1,945)	(7,008)	(4,674)
Net income	15,729	8,142	28,657	18,076
Insurance [Member] \| Operating Segments [Member]
Financial results by reportable segments [Abstract]
Net interest income	0	0	0	0
Provision for loan loss	0	0	0	0
Noninterest income	3,267	1,067	5,381	3,912
Noninterest expense	(2,009)	(919)	(4,335)	(2,715)
Income before income taxes	1,258	148	1,046	1,197
Income tax (expense) benefit	(256)	(32)	(274)	(162)
Net income	$ 1,002	$ 116	$ 772	$ 1,035

FAIR VALUE DISCLOSURES, Assets (Liabilities) Measured at Fair Value on Recurring and Non-Recurring Basis (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Securities available for sale [Abstract]
Securities available for sale	$ 726,329	$ 707,650
U.S. Government and Agencies [Member]
Securities available for sale [Abstract]
Securities available for sale	4,785	4,807
State and Municipal [Member]
Securities available for sale [Abstract]
Securities available for sale	249,830	94,692
Mortgage-Backed Securities [Member]
Securities available for sale [Abstract]
Securities available for sale	325,005	464,516
Collateralized Mortgage Obligations [Member]
Securities available for sale [Abstract]
Securities available for sale	106,777	107,289
Other [Member]
Securities available for sale [Abstract]
Securities available for sale	5,005
Recurring [Member]
Securities available for sale [Abstract]
Asset-backed and other amortizing securities	34,927	36,346
Loans held for sale (mandatory)	60,478	32,809
Mortgage servicing rights	6,562	2,054
Asset derivatives	6,700	814
Liability derivatives	(3,677)	(492)
Recurring [Member] \| U.S. Government and Agencies [Member]
Securities available for sale [Abstract]
Securities available for sale	4,785	4,807
Recurring [Member] \| State and Municipal [Member]
Securities available for sale [Abstract]
Securities available for sale	249,830	94,692
Recurring [Member] \| Mortgage-Backed Securities [Member]
Securities available for sale [Abstract]
Securities available for sale	325,005	464,516
Recurring [Member] \| Collateralized Mortgage Obligations [Member]
Securities available for sale [Abstract]
Securities available for sale	106,777	107,289
Recurring [Member] \| Other [Member]
Securities available for sale [Abstract]
Securities available for sale	5,005
Recurring [Member] \| Level 1 [Member]
Securities available for sale [Abstract]
Asset-backed and other amortizing securities	0	0
Loans held for sale (mandatory)	0	0
Mortgage servicing rights	0	0
Asset derivatives	0	0
Liability derivatives	0	0
Recurring [Member] \| Level 1 [Member] \| U.S. Government and Agencies [Member]
Securities available for sale [Abstract]
Securities available for sale	0	0
Recurring [Member] \| Level 1 [Member] \| State and Municipal [Member]
Securities available for sale [Abstract]
Securities available for sale	5,878	0
Recurring [Member] \| Level 1 [Member] \| Mortgage-Backed Securities [Member]
Securities available for sale [Abstract]
Securities available for sale	0	0
Recurring [Member] \| Level 1 [Member] \| Collateralized Mortgage Obligations [Member]
Securities available for sale [Abstract]
Securities available for sale	0	0
Recurring [Member] \| Level 1 [Member] \| Other [Member]
Securities available for sale [Abstract]
Securities available for sale	0
Recurring [Member] \| Level 2 [Member]
Securities available for sale [Abstract]
Asset-backed and other amortizing securities	34,927	36,346
Loans held for sale (mandatory)	60,478	32,809
Mortgage servicing rights	6,562	2,054
Asset derivatives	6,700	814
Liability derivatives	(3,677)	(492)
Recurring [Member] \| Level 2 [Member] \| U.S. Government and Agencies [Member]
Securities available for sale [Abstract]
Securities available for sale	4,785	4,807
Recurring [Member] \| Level 2 [Member] \| State and Municipal [Member]
Securities available for sale [Abstract]
Securities available for sale	243,952	94,692
Recurring [Member] \| Level 2 [Member] \| Mortgage-Backed Securities [Member]
Securities available for sale [Abstract]
Securities available for sale	325,005	464,516
Recurring [Member] \| Level 2 [Member] \| Collateralized Mortgage Obligations [Member]
Securities available for sale [Abstract]
Securities available for sale	106,777	107,289
Recurring [Member] \| Level 2 [Member] \| Other [Member]
Securities available for sale [Abstract]
Securities available for sale	5,005
Recurring [Member] \| Level 3 [Member]
Securities available for sale [Abstract]
Asset-backed and other amortizing securities	0	0
Loans held for sale (mandatory)	0	0
Mortgage servicing rights	0	0
Asset derivatives	0	0
Liability derivatives	0	0
Recurring [Member] \| Level 3 [Member] \| U.S. Government and Agencies [Member]
Securities available for sale [Abstract]
Securities available for sale	0	0
Recurring [Member] \| Level 3 [Member] \| State and Municipal [Member]
Securities available for sale [Abstract]
Securities available for sale	0	0
Recurring [Member] \| Level 3 [Member] \| Mortgage-Backed Securities [Member]
Securities available for sale [Abstract]
Securities available for sale	0	0
Recurring [Member] \| Level 3 [Member] \| Collateralized Mortgage Obligations [Member]
Securities available for sale [Abstract]
Securities available for sale	0	0
Recurring [Member] \| Level 3 [Member] \| Other [Member]
Securities available for sale [Abstract]
Securities available for sale	0
Nonrecurring [Member]
Assets Measured at Fair Value on a Non-Recurring Basis [Abstract]
Impaired loans	11,582	3,642
Other real estate owned	1,336	1,883
Loans held-for-sale (best efforts)	16,029	16,226
Nonrecurring [Member] \| Level 1 [Member]
Assets Measured at Fair Value on a Non-Recurring Basis [Abstract]
Impaired loans	0	0
Other real estate owned	0	0
Loans held-for-sale (best efforts)	0	0
Nonrecurring [Member] \| Level 2 [Member]
Assets Measured at Fair Value on a Non-Recurring Basis [Abstract]
Impaired loans	0	0
Other real estate owned	0	0
Loans held-for-sale (best efforts)	16,029	16,226
Nonrecurring [Member] \| Level 3 [Member]
Assets Measured at Fair Value on a Non-Recurring Basis [Abstract]
Impaired loans	11,582	3,642
Other real estate owned	1,336	1,883
Loans held-for-sale (best efforts)	$ 0	$ 0

FAIR VALUE DISCLOSURES, Quantitative Information about Non-Recurring Level 3 Fair Value Measurements (Details) - Third Party Appraisals or Inspections [Member] - Collateral Discounts and Selling Costs [Member] $ in Thousands	Sep. 30, 2020 USD ($)	Dec. 31, 2019 USD ($)
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
Impaired loans	$ 11,582	$ 3,642
Other real estate owned	$ 1,336	$ 1,883
Minimum [Member]
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
Impaired loans, discounts	0	0
Other real estate owned, discounts	0.15	0.15
Maximum [Member]
Fair Value Measurement Inputs and Valuation Techniques [Abstract]
Impaired loans, discounts	1	1
Other real estate owned, discounts	0.66	0.66

FAIR VALUE DISCLOSURES, Estimated Fair Values, and Related Carrying Amounts (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Carrying Amount [Member]
Financial assets [Abstract]
Cash and cash equivalents	$ 290,885	$ 158,099
Loans, net	2,242,158	2,119,426
Accrued interest receivable	13,632	13,924
Bank-owned life insurance	70,401	69,397
Financial liabilities [Abstract]
Deposits	2,943,802	2,696,857
Accrued interest payable	1,654	2,283
Notes payable & other borrowings	75,000	95,000
Junior subordinated deferrable interest debentures	46,393	46,393
Subordinated debt securities	75,546	26,472
Fair Value [Member]
Financial assets [Abstract]
Cash and cash equivalents	290,885	158,099
Loans, net	2,246,631	2,123,289
Accrued interest receivable	13,632	13,924
Bank-owned life insurance	70,401	69,397
Financial liabilities [Abstract]
Deposits	2,948,898	2,701,193
Accrued interest payable	1,654	2,283
Notes payable & other borrowings	75,000	95,000
Junior subordinated deferrable interest debentures	46,393	46,393
Subordinated debt securities	75,546	26,472
Level 1 [Member]
Financial assets [Abstract]
Cash and cash equivalents	290,885	158,099
Loans, net	0	0
Accrued interest receivable	0	0
Bank-owned life insurance	0	0
Financial liabilities [Abstract]
Deposits	2,674,130	2,354,999
Accrued interest payable	0	0
Notes payable & other borrowings	0	0
Junior subordinated deferrable interest debentures	0	0
Subordinated debt securities	0	0
Level 2 [Member]
Financial assets [Abstract]
Cash and cash equivalents	0	0
Loans, net	0	0
Accrued interest receivable	13,632	13,924
Bank-owned life insurance	70,401	69,397
Financial liabilities [Abstract]
Deposits	274,768	346,194
Accrued interest payable	1,654	2,283
Notes payable & other borrowings	75,000	95,000
Junior subordinated deferrable interest debentures	46,393	46,393
Subordinated debt securities	75,546	26,472
Level 3 [Member]
Financial assets [Abstract]
Cash and cash equivalents	0	0
Loans, net	2,246,631	2,123,289
Accrued interest receivable	0	0
Bank-owned life insurance	0	0
Financial liabilities [Abstract]
Deposits	0	0
Accrued interest payable	0	0
Notes payable & other borrowings	0	0
Junior subordinated deferrable interest debentures	0	0
Subordinated debt securities	$ 0	$ 0

BUSINESS COMBINATIONS, Windmark (Details) - USD ($) $ in Thousands	1 Months Ended	9 Months Ended
	Jun. 30, 2020	Sep. 30, 2020	Sep. 30, 2019
Assets Acquired and Liabilities Assumed [Abstract]
Cash paid		$ 687	$ 2,800
Windmark Insurance Agency, Inc. [Member] \| Crop Insurance Agency in Nebraska [Member]
Assets Acquired and Liabilities Assumed [Abstract]
Cash paid	$ 687
Assets acquired [Abstract]
Premises and equipment, net	24
Total assets acquired	687
Windmark Insurance Agency, Inc. [Member] \| Crop Insurance Agency in Nebraska [Member] \| Customer List [Member]
Assets acquired [Abstract]
Intangible assets	512
Windmark Insurance Agency, Inc. [Member] \| Crop Insurance Agency in Nebraska [Member] \| Other Intangible Assets [Member]
Assets acquired [Abstract]
Intangible assets	$ 151

BUSINESS COMBINATIONS, West Texas State Bank (Details) $ in Thousands		9 Months Ended		12 Months Ended
	Nov. 12, 2019 USD ($) Branch	Sep. 30, 2020 USD ($)	Sep. 30, 2019 USD ($)	Dec. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)
Business Combinations [Abstract]
Increase in goodwill		$ 751		$ 0
Assets Acquired and Liabilities Assumed [Abstract]
Cash paid		687	$ 2,800
Liabilities assumed [Abstract]
Goodwill recorded in acquisition		19,508		18,757	$ 0
West Texas State Bank [Member]
Business Combinations [Abstract]
Number of additional branches \| Branch	6
Ownership interest	100.00%
Goodwill recognized expected to be deductible for income tax purposes	$ 0
Acquisition expenses				$ 955
Non-credit impaired loans fair value	196,200
Contractual balance of non-credit impaired loans	198,400
Discount on acquired loans being recognized into interest income	2,200
Increase in goodwill		751
Decrease in loans		(900)
Decrease in other liabilities		$ (160)
Assets Acquired and Liabilities Assumed [Abstract]
Cash paid	76,100
Assets acquired [Abstract]
Cash and cash equivalents	77,903
Interest-bearing time deposits in banks	52,700
Federal funds purchased	26,468
Securities available for sale	68,398
Loans held for investment	195,228
Bank-owned life insurance	10,932
Premises and equipment, net	4,132
Accrued interest receivable	1,114
Other assets	2,648
Total assets acquired	446,202
Liabilities assumed [Abstract]
Deposits	386,176
Accrued interest payable	55
Deferred tax liability	762
Other liabilities	2,424
Total liabilities assumed	389,417
Net assets acquired	56,785
Goodwill recorded in acquisition	19,315
West Texas State Bank [Member] \| Core Deposit Intangible [Member]
Assets acquired [Abstract]
Intangible assets	$ 6,679

LOANS HELD FOR INVESTMENT, Summary of Internal Classifications of Loans (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Loans by Internal Classifications [Abstract]
Loans	$ 2,288,234	$ 2,143,623
Pass [Member]
Loans by Internal Classifications [Abstract]
Loans	2,196,661	2,095,056
Special Mention [Member]
Loans by Internal Classifications [Abstract]
Loans	0	22,313
Substandard [Member]
Loans by Internal Classifications [Abstract]
Loans	91,573	26,254
Doubtful [Member]
Loans by Internal Classifications [Abstract]
Loans	0	0
Commercial Real Estate [Member]
Loans by Internal Classifications [Abstract]
Loans	655,432	658,195
Commercial Real Estate [Member] \| Pass [Member]
Loans by Internal Classifications [Abstract]
Loans	593,746	632,641
Commercial Real Estate [Member] \| Special Mention [Member]
Loans by Internal Classifications [Abstract]
Loans	0	22,313
Commercial Real Estate [Member] \| Substandard [Member]
Loans by Internal Classifications [Abstract]
Loans	61,686	3,241
Commercial Real Estate [Member] \| Doubtful [Member]
Loans by Internal Classifications [Abstract]
Loans	0	0
Commercial [Member] \| Specialized [Member]
Loans by Internal Classifications [Abstract]
Loans	340,458	309,505
Commercial [Member] \| Specialized [Member] \| Pass [Member]
Loans by Internal Classifications [Abstract]
Loans	331,377	307,239
Commercial [Member] \| Specialized [Member] \| Special Mention [Member]
Loans by Internal Classifications [Abstract]
Loans	0	0
Commercial [Member] \| Specialized [Member] \| Substandard [Member]
Loans by Internal Classifications [Abstract]
Loans	9,081	2,266
Commercial [Member] \| Specialized [Member] \| Doubtful [Member]
Loans by Internal Classifications [Abstract]
Loans	0	0
Commercial [Member] \| General [Member]
Loans by Internal Classifications [Abstract]
Loans	578,181	441,398
Commercial [Member] \| General [Member] \| Pass [Member]
Loans by Internal Classifications [Abstract]
Loans	566,802	428,155
Commercial [Member] \| General [Member] \| Special Mention [Member]
Loans by Internal Classifications [Abstract]
Loans	0	0
Commercial [Member] \| General [Member] \| Substandard [Member]
Loans by Internal Classifications [Abstract]
Loans	11,379	13,243
Commercial [Member] \| General [Member] \| Doubtful [Member]
Loans by Internal Classifications [Abstract]
Loans	0	0
Consumer [Member] \| 1-4 Family Residential [Member]
Loans by Internal Classifications [Abstract]
Loans	372,114	362,796
Consumer [Member] \| 1-4 Family Residential [Member] \| Pass [Member]
Loans by Internal Classifications [Abstract]
Loans	364,413	356,422
Consumer [Member] \| 1-4 Family Residential [Member] \| Special Mention [Member]
Loans by Internal Classifications [Abstract]
Loans	0	0
Consumer [Member] \| 1-4 Family Residential [Member] \| Substandard [Member]
Loans by Internal Classifications [Abstract]
Loans	7,701	6,374
Consumer [Member] \| 1-4 Family Residential [Member] \| Doubtful [Member]
Loans by Internal Classifications [Abstract]
Loans	0	0
Consumer [Member] \| Auto Loans [Member]
Loans by Internal Classifications [Abstract]
Loans	193,023	215,209
Consumer [Member] \| Auto Loans [Member] \| Pass [Member]
Loans by Internal Classifications [Abstract]
Loans	191,727	214,363
Consumer [Member] \| Auto Loans [Member] \| Special Mention [Member]
Loans by Internal Classifications [Abstract]
Loans	0	0
Consumer [Member] \| Auto Loans [Member] \| Substandard [Member]
Loans by Internal Classifications [Abstract]
Loans	1,296	846
Consumer [Member] \| Auto Loans [Member] \| Doubtful [Member]
Loans by Internal Classifications [Abstract]
Loans	0	0
Consumer [Member] \| Other Consumer [Member]
Loans by Internal Classifications [Abstract]
Loans	68,877	74,000
Consumer [Member] \| Other Consumer [Member] \| Pass [Member]
Loans by Internal Classifications [Abstract]
Loans	68,447	73,716
Consumer [Member] \| Other Consumer [Member] \| Special Mention [Member]
Loans by Internal Classifications [Abstract]
Loans	0	0
Consumer [Member] \| Other Consumer [Member] \| Substandard [Member]
Loans by Internal Classifications [Abstract]
Loans	430	284
Consumer [Member] \| Other Consumer [Member] \| Doubtful [Member]
Loans by Internal Classifications [Abstract]
Loans	0	0
Construction [Member]
Loans by Internal Classifications [Abstract]
Loans	80,149	82,520
Construction [Member] \| Pass [Member]
Loans by Internal Classifications [Abstract]
Loans	80,149	82,520
Construction [Member] \| Special Mention [Member]
Loans by Internal Classifications [Abstract]
Loans	0	0
Construction [Member] \| Substandard [Member]
Loans by Internal Classifications [Abstract]
Loans	0	0
Construction [Member] \| Doubtful [Member]
Loans by Internal Classifications [Abstract]
Loans	$ 0	$ 0