v3.26.3
Branch Sale Agreement
9 Months Ended
Sep. 30, 2026
Disposal Group, Including Discontinued Operation, Additional Disclosures [Abstract]  
Branch Sale Agreement
Note 3 - Branch Sale Agreement
On September 29, 2026, the Bank entered into a purchase and assumption agreement (the “P&A Agreement”) with respect to the Bank’s branch office located at North Riverside, Illinois. Pursuant to the P&A Agreement, another financial institution will purchase the branch office as well as certain loans and other assets attributed to the branch office and will also assume certain deposit and other liabilities attributed to the branch office (the “Chicago Branch Sale”). Consummation of the Chicago Branch Sale remains subject to customary closing conditions, including the receipt of all required regulatory approvals and is expected to close during the first quarter of 2027.
Management evaluated the transaction under ASC 360 and ASC 205-20 and concluded that the disposal does not represent a strategic shift that has a major effect on the Company’s operations or financial results. Accordingly, the transaction is not reported as discontinued operations.
The loans are recorded at their amortized cost of $60.2 million and are reported within Loans held for sale on the Consolidated Balance Sheet as of September 30, 2026. The loans will be sold at par value, or the unpaid principal balance on the loan exclusive of any accrued interest, fees, premiums, discounts, reserves or allowances. Upon completion of the sale, the Company will recognize any difference between the sale proceeds and the carrying amount of the loans as a gain or loss. The Branch location’s real estate and furniture and equipment are also classified as held for sale and valued at $1.3 million as of September 30, 2026. These assets are reported in the Premises and equipment, net on the Consolidated Balance Sheet. The Company did not recognize an impairment loss upon classification of the disposal group as held for sale because its carrying amount did not exceed its fair value less cost to sell as of September 30, 2026.
At September 30, 2026, there were approximately $111.1 million of deposits held at the branch office that are expected to be assumed in the Chicago Branch Sale. Based upon the composition of deposits at September 30, 2026, the Bank would have received a deposit premium of approximately $3.2 million had the transaction been completed on that date.
The assets and liabilities subject to the Chicago Branch Sale, as well as their related income statement accounts, are reported within the Company’s Commercial Bank segment.