HOME BANCORP, INC. - FORM 10-Q

HOME BANCORP, INC. - FORM 10-Q - May 11, 2015

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x	Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended: March 31, 2015

¨	Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from to

Commission File Number: 001-34190

HOME BANCORP, INC.

(Exact name of Registrant as specified in its charter)


Louisiana		71-1051785
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification Number)

503 Kaliste Saloom Road, Lafayette, Louisiana		70508
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s telephone number, including area code: (337) 237-1960

Not Applicable

(Former Name, Former Address and Former Fiscal Year, if changed since last report)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months and (2) has been subject to such filing requirements for the past 90 days. YES x NO ¨

Indicate by check mark whether the Registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). YES x NO ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). YES ¨ NO x

At May 5, 2015, the registrant had 7,152,603 shares of common stock, $0.01 par value, outstanding.

HOME BANCORP, INC. and SUBSIDIARY

TABLE OF CONTENTS


		Page

PART I

Item 1.	Financial Statements (unaudited)

	Consolidated Statements of Financial Condition		1

	Consolidated Statements of Income		2

	Consolidated Statements of Comprehensive Income		3

	Consolidated Statements of Changes in Shareholders’ Equity		4

	Consolidated Statements of Cash Flows		5

	Notes to Unaudited Consolidated Financial Statements		6

Item 2.	Managements’ Discussion and Analysis of Financial Condition and Results of Operations		26

Item 3.	Quantitative and Qualitative Disclosures About Market Risk		37

Item 4.	Controls and Procedures		37

PART II

Item 1.	Legal Proceedings		37

Item 1A.	Risk Factors		37

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		37

Item 3.	Defaults Upon Senior Securities		38

Item 4.	Mine Safety Disclosures		38

Item 5.	Other Information		38

Item 6.	Exhibits		39

SIGNATURES			40

HOME BANCORP, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION


	(Unaudited) March 31, 2015			(Audited) December 31, 2014
Assets
Cash and cash equivalents	$	30,175,858		$	29,077,907
Interest-bearing deposits in banks		5,526,000			5,526,000
Investment securities available for sale, at fair value		171,488,522			174,800,516
Investment securities held to maturity (fair values of $14,140,643 and $11,889,335, respectively)		13,912,512			11,705,470
Mortgage loans held for sale		5,622,509			4,516,835
Loans, net of unearned income		922,088,691			908,967,871
Allowance for loan losses		(8,271,676	)		(7,759,500	)

Total loans, net of unearned income and allowance for loan losses		913,817,015			901,208,371

Office properties and equipment, net		37,584,386			37,964,714
Cash surrender value of bank-owned life insurance		19,295,469			19,163,110
Accrued interest receivable and other assets		36,433,586			37,451,687

Total Assets	$	1,233,855,857		$	1,221,414,610


Liabilities
Deposits:
Noninterest-bearing	$	276,319,489		$	267,660,145
Interest-bearing		750,253,148			725,912,448

Total deposits		1,026,572,637			993,572,593
Short-term Federal Home Loan Bank (FHLB) advances		6,000,000			31,000,000
Long-term Federal Home Loan Bank (FHLB) advances		19,000,000			16,500,000
Securities sold under repurchase agreements		20,204,822			20,370,892
Accrued interest payable and other liabilities		5,295,919			5,827,369

Total Liabilities		1,077,073,378			1,067,270,854


Shareholders’ Equity
Preferred stock, $0.01 par value - 10,000,000 shares authorized; none issued		—			—
Common stock, $0.01 par value - 40,000,000 shares authorized; 9,132,145 and 9,008,745 shares issued; 7,163,649 and 7,123,442 shares outstanding, respectively		91,322			90,088
Additional paid-in capital		94,932,283			93,332,108
Treasury stock at cost - 1,968,496 and 1,885,303 shares, respectively		(30,372,933	)		(28,572,891	)
Unallocated common stock held by:
Employee Stock Ownership Plan (ESOP)		(4,820,480	)		(4,909,750	)
Recognition and Retention Plan (RRP)		(202,590	)		(202,590	)
Retained earnings		95,449,296			93,101,915
Accumulated other comprehensive income		1,705,581			1,304,876

Total Shareholders’ Equity		156,782,479			154,143,756

Total Liabilities and Shareholders’ Equity	$	1,233,855,857		$	1,221,414,610

The accompanying Notes are an integral part of these Consolidated Financial Statements.

HOME BANCORP, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF INCOME (Unaudited)


	For the Three Months Ended
	March 31,
	2015		2014
Interest Income
Loans, including fees	$	12,360,963	$	11,484,445
Investment securities		910,121		1,050,846
Other investments and deposits		33,752		31,158

Total interest income		13,304,836		12,566,449


Interest Expense
Deposits		684,979		622,565
Securities sold under repurchase agreement		18,429		16,675
Short-term FHLB advances		6,071		35,661
Long-term FHLB advances		103,235		80,550

Total interest expense		812,714		755,451

Net interest income		12,492,122		11,810,998
Provision for loan losses		538,487		145,016

Net interest income after provision for loan losses		11,953,635		11,665,982


Noninterest Income
Service fees and charges		892,118		796,093
Bank card fees		565,584		455,984
Gain on sale of loans, net		373,173		161,862
Income from bank-owned life insurance		132,359		110,641
Gain on sale of securities, net		—		1,826
Other income		115,450		129,573

Total noninterest income		2,078,684		1,655,979


Noninterest Expense
Compensation and benefits		5,760,787		6,794,808
Occupancy		1,171,280		1,014,330
Marketing and advertising		110,328		207,241
Data processing and communication		943,332		1,371,823
Professional services		238,175		487,110
Forms, printing and supplies		144,810		161,920
Franchise and shares tax		147,272		184,385
Regulatory fees		280,467		228,377
Foreclosed assets, net		235,782		361,885
Other expenses		686,853		445,166

Total noninterest expense		9,719,086		11,257,045

Income before income tax expense		4,313,233		2,064,916
Income tax expense		1,465,469		631,460

Net Income	$	2,847,764	$	1,433,456


Earnings per share:
Basic	$	0.43	$	0.22

Diluted	$	0.41	$	0.21


Cash dividends declared per common share	$	0.07	$	—

The accompanying Notes are an integral part of these Consolidated Financial Statements.

HOME BANCORP, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)


	For the Three Months Ended
	March 31,
	2015			2014

Net Income	$	2,847,764		$	1,433,456


Other Comprehensive Income
Unrealized gains on investment securities	$	616,469		$	746,538
Reclassification adjustment for gains included in net income		—			(1,826	)
Tax effect ⁽¹⁾		(215,764	)		(260,649	)

Other comprehensive (loss) income, net of taxes	$	400,705		$	484,063


Comprehensive Income	$	3,248,469		$	1,917,519

(1)	The tax effect on the change in unrealized gains on investment securities was $215,764 and $261,288 for the quarters ending March 31, 2015 and 2014, respectively. The reclassification adjustment for gains included in the net income had a tax effect of $639 for the quarter ending March 31, 2014.

The accompanying Notes are an integral part of these Consolidated Financial Statements.

HOME BANCORP, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Unaudited)


	Common Stock		Additional Paid-in Capital		Treasury Stock			Unallocated Common Stock Held by ESOP			Unallocated Common Stock Held by RRP			Retained Earnings			Accumulated Other Comprehensive Income		Total

Balance, December 31, 2013⁽¹⁾	$	89,585	$	92,192,410	$	(28,011,398	)	$	(5,266,830	)	$	(1,018,497	)	$	83,729,144		$	195,115	$	141,909,529
Net income															1,433,456					1,433,456
Other comprehensive income																		484,063		484,063
Treasury stock acquired at cost, 200 shares						(4,148	)													(4,148	)
Exercise of stock options		3		3,432																3,435
ESOP shares released for allocation				94,146					89,270											183,416
Share-based compensation cost				365,496																365,496

Balance, March 31, 2014	$	89,588	$	92,655,484	$	(28,015,546	)	$	(5,177,560	)	$	(1,018,497	)	$	85,162,600		$	679,178	$	144,375,247


Balance, December 31, 2014⁽¹⁾	$	90,088	$	93,332,108	$	(28,572,891	)	$	(4,909,750	)	$	(202,590	)	$	93,101,915		$	1,304,876	$	154,143,756
Net income															2,847,764					2,847,764
Other comprehensive income																		400,705		400,705
Treasury stock acquired at cost, 83,193 shares						(1,800,042	)													(1,800,042	)
Cash dividends declared, $0.07 per share															(500,383	)				(500,383	)
Exercise of stock options		1,234		1,425,616																1,426,850
ESOP shares released for allocation				141,619					89,270											230,889
Share-based compensation cost				32,940																32,940

Balance, March 31, 2015	$	91,322	$	94,932,283	$	(30,372,933	)	$	(4,820,480	)	$	(202,590	)	$	95,449,296		$	1,705,581	$	156,782,479

⁽¹⁾	Balances as of December 31, 2013 and December 31, 2014 are audited.

The accompanying Notes are an integral part of these Consolidated Financial Statements.

HOME BANCORP, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)


	For the Three Months Ended
	March 31,
	2015			2014
Cash flows from operating activities, net of effects of acquisition in 2014:
Net income	$	2,847,764		$	1,433,456
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan losses		538,487			145,016
Depreciation		447,898			404,657
Amortization of purchase accounting valuations and intangibles		1,214,457			1,768,439
Net amortization of mortgage servicing asset		31,270			59,574
Federal Home Loan Bank stock dividends		(3,900	)		(3,000	)
Net amortization of premium on investments		354,341			270,253
Gain on sale of investment securities, net		—			(1,826	)
Gain on loans sold, net		(373,173	)		(161,862	)
Proceeds, including principal payments, from loans held for sale		35,200,887			15,008,478
Originations of loans held for sale		(35,933,388	)		(16,714,484	)
Non-cash compensation		226,961			548,912
Deferred income tax (benefit) provision		(43,135	)		399,068
Decrease (increase) in interest receivable and other assets		(316,553	)		2,407,200
Increase in cash surrender value of bank-owned life insurance		(132,359	)		(110,641	)
Decrease in accrued interest payable and other liabilities		(494,581	)		(4,927,511	)

Net cash provided by operating activities		3,564,976			525,729


Cash flows from investing activities, net of effects of acquisition in 2014:
Purchases of securities available for sale		(3,126,663	)		(7,805,876	)
Purchases of securities held to maturity		(2,273,910	)		(1,559,433	)
Proceeds from maturities, prepayments and calls on securities available for sale		6,767,654			6,696,912
Proceeds from maturities, prepayments and calls on securities held to maturity		—			202,594
Proceeds from sales of securities available for sale		—			66,904,999
Net increase in loans		(14,586,858	)		(14,107,938	)
Reimbursement from FDIC for covered assets		130,933			226,038
Proceeds from sale of repossessed assets		496,798			1,208,064
Purchases of office properties and equipment		(67,570	)		(852,569	)
Proceeds from sale of properties and equipment		500			—
Net cash disbursed in business combination		—			(22,995,365	)
Purchases of Federal Home Loan Bank stock		(722,500	)		(2,129,600	)
Proceeds from redemption of Federal Home Loan Bank stock		1,272,900			—

Net cash (used in) provided by investing activities		(12,108,716	)		25,787,826


Cash flows from financing activities, net of effects of acquisition in 2014:
Increase in deposits		33,015,266			29,507,951
Decrease in Federal Home Loan Bank advances		(22,500,000	)		(24,924,000	)
Decrease in securities sold under repurchase agreements		—			(6,314,675	)
Purchase of treasury stock		(1,800,042	)		(4,148	)
Proceeds from exercise of stock options		1,426,850			3,435
Payment of dividends on common stock		(500,383	)		—

Net cash provided (used in) by financing activities		9,641,691			(1,731,437	)


Net change in cash and cash equivalents		1,097,951			24,582,118
Cash and cash equivalents at beginning of year		29,077,907			32,638,900

Cash and cash equivalents at end of period	$	30,175,858		$	57,221,018

The accompanying Notes are an integral part of these Consolidated Financial Statements.

HOME BANCORP, INC. AND SUBSIDIARY

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of Presentation

The accompanying unaudited consolidated financial statements of Home Bancorp, Inc. (the “Company”) were prepared in accordance with instructions for Form 10-Q and Regulation S-X and do not include information or footnotes necessary for a complete presentation of financial condition, results of operations, other comprehensive income, changes in shareholders’ equity and cash flows in conformity with accounting principles generally accepted in the United States of America. However, in the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the financial statements have been included. The results of operations for the three-month period ended March 31, 2015 are not necessarily indicative of the results which may be expected for the entire fiscal year. These statements should be read in conjunction with the Consolidated Financial Statements and notes thereto included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) for the year ended December 31, 2014.

In preparing the financial statements, the Company is required to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. The financial statements reflect all adjustments that are, in the opinion of management, necessary for a fair statement of the Company’s financial condition, results of operations, other comprehensive income, changes in shareholders’ equity and cash flows for the interim periods presented. These adjustments are of a normal recurring nature and include appropriate estimated provisions.

Certain amounts reported in prior periods have been reclassified to conform to the current period presentation. Such reclassifications had no effect on previously reported shareholders’ equity or net income.

2. Recent Accounting Pronouncements

In August 2014, the FASB issued ASU 2014-15, “Presentation of Financial Statements – Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern.” ASU 2014-15 requires companies to evaluate whether there are conditions and events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the financial statements are issued. Management will be required to make the evaluation and disclose for both annual and interim reporting periods. The ASU is effective for interim and annual periods after December 15, 2016. The adoption of this ASU is not expected to have a material effect on our Consolidated Financial Statements.

In February 2015, the FASB issued ASU 2015-02, “Amendments to the Consolidation Analysis,” which eliminates the deferral of certain investments in variable interest entities. ASU 2015-02 will allow companies with interests in certain investment funds to follow preceding consolidation guidance and make changes to the variable interest model and the voting model. The ASU is effective for annual and interim periods beginning after December 15, 2015. The adoption of this ASU is not expected to have a material effect on our Consolidated Financial Statements.

3. Investment Securities

Summary information regarding the Company’s investment securities classified as available for sale and held to maturity as of March 31, 2015 and December 31, 2014 is as follows.


*(dollars in thousands)*	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses				Fair Value
					Less Than 1 Year		Over 1 Year
March 31, 2015
Available for sale:
U.S. agency mortgage-backed	$	117,216	$	2,168	$	—	$	316	$	119,068
Non-U.S. agency mortgage-backed		7,360		55		27		25		7,363
Municipal bonds		23,752		620		17		11		24,344
U.S. government agency		20,537		226		—		49		20,714

Total available for sale	$	168,865	$	3,069	$	44	$	401	$	171,489


Held to maturity:
Municipal bonds	$	13,913	$	256	$	27	$	1	$	14,141


*(dollars in thousands)*	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses				Fair Value
					Less Than 1 Year		Over 1 Year
December 31, 2014
Available for sale:
U.S. agency mortgage-backed	$	120,009	$	1,984	$	10	$	485	$	121,498
Non-U.S. agency mortgage-backed		7,757		61		28		26		7,764
Municipal bonds		24,388		561		2		51		24,896
U.S. government agency		20,639		190		—		186		20,643

Total available for sale	$	172,793	$	2,796	$	40	$	748	$	174,801


Held to maturity:
Municipal bonds	$	11,705	$	202	$	3	$	15	$	11,889

The estimated fair value and amortized cost by maturity of the Company’s investment securities as of March 31, 2015 are shown in the following tables. Securities are classified according to their contractual maturities without consideration of principal amortization, potential prepayments or call options. The expected maturity of a security may differ from its contractual maturity because of prepayments or the exercise of call options. Accordingly, actual maturities may differ from contractual maturities.


*(dollars in thousands)*	One Year or Less		One Year to Five Years		Five to Ten Years		Over Ten Years		Total
Fair Value
Securities available for sale:
U.S. agency mortgage-backed	$	—	$	116	$	26,979	$	91,973	$	119,068
Non-U.S. agency mortgage-backed		—		—		—		7,363		7,363
Municipal bonds		857		8,502		11,186		3,799		24,344
U.S. government agency		—		16,176		—		4,538		20,714

Total available for sale	$	857	$	24,794	$	38,165	$	107,673	$	171,489


Securities held to maturity:
Municipal bonds	$	411	$	242	$	9,216	$	4,272	$	14,141

Total investment securities	$	1,268	$	25,036	$	47,381	$	111,945	$	185,630


*(dollars in thousands)*	One Year or Less		One Year to Five Years		Five to Ten Years		Over Ten Years		Total
Amortized Cost
Securities available for sale:
U.S. agency mortgage-backed	$	—	$	110	$	26,687	$	90,419	$	117,216
Non-U.S. agency mortgage-backed		—		—		—		7,360		7,360
Municipal bonds		828		8,261		10,999		3,664		23,752
U.S. government agency		—		16,111		—		4,426		20,537

Total available for sale	$	828	$	24,482	$	37,686	$	105,869	$	168,865


Securities held to maturity:
Municipal bonds	$	401	$	235	$	9,011	$	4,266	$	13,913

Total investment securities	$	1,229	$	24,717	$	46,697	$	110,135	$	182,778

Management evaluates securities for other-than-temporary impairment at least quarterly, and more frequently when economic and market conditions warrant such evaluations. Consideration is given to (1) the extent and length of time the fair value has been below cost; (2) the reasons for the decline in value; and (3) the Company’s intent to sell a security or whether it is more likely than not the Company will be required to sell the security before the recovery of its amortized cost, which may extend to maturity.

The Company performs a process to identify securities that could potentially have a credit impairment that is other-than-temporary. This process involves evaluating each security for impairment by monitoring credit performance, collateral type, collateral geography, bond credit support, loan-to-value ratios, credit scores, loss severity levels, pricing levels, downgrades by rating agencies, cash flow projections and other factors as indicators of potential credit issues. When the Company determines that a security is deemed to be other-than-temporarily impaired, an impairment loss is recognized.

As of March 31, 2015, 29 of the Company’s debt securities had unrealized losses totaling 1.4% of the individual securities’ amortized cost basis and 0.3% of the Company’s total amortized cost basis of the investment securities portfolio. At such date, 17 of the 29 securities had been in a continuous loss position for over 12 months. The 17 securities had an aggregate amortized cost basis of $27.2 million and unrealized loss of $402,000 at March 31, 2015. Management has the intent and ability to hold these debt securities until maturity, or until anticipated recovery; hence, no declines in these 17 securities were deemed to be other-than-temporary.

As of March 31, 2015 and December 31, 2014, the Company had $92,123,000 and $76,491,000, respectively, of securities pledged to secure public deposits. As of March 31, 2015 and December 31, 2014, the Company had $21,844,000 and $21,211,000 of securities pledged to securities sold under repurchase agreements.

4. Earnings Per Share

Earnings per common share were computed based on the following:


	Three Months Ended March 31,
*(in thousands, except per share data)*	2015		2014

Numerator:
Net income available to common shareholders	$	2,847	$	1,433

Denominator:
Weighted average common shares outstanding		6,634		6,491
Effect of dilutive securities:
Restricted stock		3		61
Stock options		325		339

Weighted average common shares outstanding – assuming dilution		6,962		6,891


Basic earnings per common share	$	0.43	$	0.22

Diluted earnings per common share	$	0.41	$	0.21

Options on 9,500 and 47,500 shares of common stock were not included in the computation of diluted earnings per share for the three months ended March 31, 2015 and March 31, 2014, respectively, because the effect of these options was anti-dilutive.

5. Credit Quality and Allowance for Loan Losses

The following briefly describes the distinction between originated and acquired loans and certain significant accounting policies relevant to each category.

Originated Loans

Loans originated for investment are reported at the principal balance outstanding net of unearned income. Interest on loans and accretion of unearned income are computed in a manner that approximates a level yield on recorded principal. Interest on loans is recorded as income as earned. The accrual of interest on an originated loan is discontinued when it is probable the borrower will not be able to meet payment obligations as they become due. The Company maintains an allowance for loan losses on originated loans that represents management’s estimate of probable losses incurred in this portfolio category.

Acquired Loans

Acquired Loans that were acquired as a result of our acquisitions of certain assets and liabilities of Statewide Bank (“Statewide”) of Covington, Louisiana, on March 12, 2010, GS Financial Corp. (“GSFC”), the former holding company of Guaranty Savings Bank of Metairie, Louisiana, on July 15, 2011 and Britton & Koontz Capital Corporation (“Britton & Koontz”), the former holding company of Britton & Koontz Bank, N.A. (“Britton & Koontz Bank”) of Natchez, Mississippi on February 14, 2014 are referred to as “Acquired Loans.”

Acquired Loans were recorded at estimated fair value at the acquisition date with no carryover of the related allowance for loan losses. The acquired loans were segregated between those considered to be performing (“acquired performing”) and those with evidence of credit deterioration (“acquired impaired”), and then further segregated into loan pools designed to facilitate the estimation of expected cash flows. The fair value estimate for each pool of acquired performing and acquired impaired loans was based on the estimate of expected cash flows, both principal and interest, from that pool, discounted at prevailing market interest rates.

The difference between the fair value of an acquired performing loan pool and the contractual amounts due at the acquisition date (the “fair value discount”) is accreted into income over the estimated life of the pool. Management estimates an allowance for loan losses for acquired performing loans using a methodology similar to that used for originated loans. The allowance determined for each loan pool is compared to the remaining fair value discount for that pool. If the allowance amount calculated under the Company’s methodology is greater than the Company’s

remaining discount, the additional amount called for is added to the reported allowance through a provision for loan losses. If the allowance amount calculated under the Company’s methodology is less than the Company’s recorded discount, no additional allowance or provision is recognized. Actual losses first reduce any remaining fair value discount for the loan pool. Once the discount is fully depleted, losses are applied against the allowance established for that pool. Acquired performing loans are placed on nonaccrual status and considered and reported as nonperforming or past due using the same criteria applied to the originated portfolio.

The excess of cash flows expected to be collected from an acquired impaired loan pool over the pool’s estimated fair value at acquisition is referred to as the accretable yield and is recognized in interest income using an effective yield method over the remaining life of the pool. Each pool of acquired impaired loans is accounted for as a single asset with a single composite interest rate and an aggregate expectation of cash flows.

Management recasts the estimate of cash flows expected to be collected on each acquired impaired loan pool periodically. If the present value of expected cash flows for a pool is less than its carrying value, an impairment is recognized by an increase in the allowance for loan losses and a charge to the provision for loan losses. If the present value of expected cash flows for a pool is greater than its carrying value, any previously established allowance for loan losses is reversed and any remaining difference increases the accretable yield which will be taken into interest income over the remaining life of the loan pool. Acquired impaired loans are generally not subject to individual evaluation for impairment and are not reported with impaired loans, even if they would otherwise qualify for such treatment.

Certain loans purchased in the Statewide acquisition are covered by loss sharing agreements between the FDIC and the Company. Historically, the Company has referred to loans subject to loss share agreements with the FDIC as “covered loans.” However, as of March 31, 2015, the commercial loss share agreements had expired and any future losses on these formerly covered loans are no longer eligible for reimbursement from the FDIC. As of March 31, 2015, only residential mortgage loans acquired from Statewide remained subject to loss sharing agreements with the FDIC. As of March 31, 2015, the Company’s remaining covered loans amounted to approximately $4.9 million, or less than 1.0% of the Company’s total loan portfolio, at such date. Given the limited amount of covered loans remaining, as of March 31, 2015, the Company is no longer reporting such loans as “covered loans,” and the remaining covered loans are included in “acquired loans.”

The allowance for loan losses and recorded investment in loans as of the dates indicated are as follows.


	As of March 31, 2015
	Originated Loans
*(dollars in thousands)*	Collectively Evaluated for Impairment		Individually Evaluated for Impairment		Acquired Loans		Total
Allowance for loan losses:
One- to four-family first mortgage	$	1,232	$	—	$	174	$	1,406
Home equity loans and lines		463		—		111		574
Commercial real estate		2,961		107		—		3,068
Construction and land		1,020		—		133		1,153
Multi-family residential		227		—		—		227
Commercial and industrial		1,274		33		—		1,307
Consumer		537		—		—		537

Total allowance for loan losses	$	7,714	$	140	$	418	$	8,272


	As of March 31, 2015
	Originated Loans
*(dollars in thousands)*	Collectively Evaluated for Impairment		Individually Evaluated for Impairment		Acquired Loans⁽¹⁾		Total
Loans:
One- to four-family first mortgage	$	168,912	$	78	$	65,271	$	234,261
Home equity loans and lines		35,723		—		19,616		55,339
Commercial real estate		287,099		777		67,443		355,319
Construction and land		79,911		—		9,000		88,911
Multi-family residential		19,623		—		10,553		30,176
Commercial and industrial		97,317		1,123		13,722		112,162
Consumer		43,393		—		2,528		45,921

Total loans	$	731,978	$	1,978	$	188,133	$	922,089


	As of December 31, 2014
	Originated Loans
*(dollars in thousands)*	Collectively Evaluated for Impairment		Individually Evaluated for Impairment		Acquired Loans		Total
Allowance for loan losses:
One- to four-family first mortgage	$	1,136	$	—	$	174	$	1,310
Home equity loans and lines		442		—		111		553
Commercial real estate		2,815		107		—		2,922
Construction and land		968		—		133		1,101
Multi-family residential		192		—		—		192
Commercial and industrial		1,128		33		—		1,161
Consumer		521		—		—		521

Total allowance for loan losses	$	7,202	$	140	$	418	$	7,760


	As of December 31, 2014
	Originated Loans
*(dollars in thousands)*	Collectively Evaluated for Impairment		Individually Evaluated for Impairment		Acquired Loans⁽¹⁾		Total
Loans:
One- to four-family first mortgage	$	164,450	$	78	$	68,721	$	233,249
Home equity loans and lines		34,485		—		21,515		56,000
Commercial real estate		279,493		777		72,593		352,863
Construction and land		77,057		—		12,097		89,154
Multi-family residential		16,507		—		10,868		27,375
Commercial and industrial		88,411		1,128		14,907		104,446
Consumer		43,049		—		2,832		45,881

Total loans	$	703,452	$	1,983	$	203,533	$	908,968

⁽¹⁾	$26.3 million and $31.9 million in acquired loans were accounted for under ASC 310-30 at March 31, 2015 and December 31, 2014, respectively.

A summary of activity in the allowance for loan losses during the three months ended March 31, 2015 and March 31, 2014 follows.


	For the Three Months Ended March 31, 2015
*(dollars in thousands)*	Beginning Balance		Charge-offs			Recoveries		Provision		Ending Balance
Originated loans:
Allowance for loan losses:
One- to four-family first mortgage	$	1,136	$	—		$	—	$	96	$	1,232
Home equity loans and lines		442		—			3		18		463
Commercial real estate		2,922		—			—		146		3,068
Construction and land		968		—			—		52		1,020
Multi-family residential		192		—			—		35		227
Commercial and industrial		1,161		(44	)		30		160		1,307
Consumer		521		(15	)		—		31		537

Total allowance for loan losses	$	7,342	$	(59	)	$	33	$	538	$	7,854


Acquired loans:
Allowance for loan losses:
One- to four-family first mortgage	$	174	$	—		$	—	$	—	$	174
Home equity loans and lines		111		—			—		—		111
Commercial real estate		—		—			—		—		—
Construction and land		133		—			—		—		133
Multi-family residential		—		—			—		—		—
Commercial and industrial		—		—			—		—		—
Consumer		—		—			—		—		—

Total allowance for loan losses	$	418	$	—		$	—	$	—	$	418


Total loans:
Allowance for loan losses:
One- to four-family first mortgage	$	1,310	$	—		$	—	$	96	$	1,406
Home equity loans and lines		553		—			3		18		574
Commercial real estate		2,922		—			—		146		3,068
Construction and land		1,101		—			—		52		1,153
Multi-family residential		192		—			—		35		227
Commercial and industrial		1,161		(44	)		30		160		1,307
Consumer		521		(15	)		—		31		537

Total allowance for loan losses	$	7,760	$	(59	)	$	33	$	538	$	8,272


	For the Three Months Ended March 31, 2014
*(dollars in thousands)*	Beginning Balance		Charge-offs			Recoveries		Provision			Ending Balance
Originated loans:
Allowance for loan losses:
One- to four-family first mortgage	$	904	$	—		$	—	$	32		$	936
Home equity loans and lines		366		—			2		5			373
Commercial real estate		2,528		—			—		115			2,643
Construction and land		977		(20	)		—		164			1,121
Multi-family residential		90		—			—		(6	)		84
Commercial and industrial		1,332		—			68		(177	)		1,223
Consumer		473		(11	)		2		12			476

Total allowance for loan losses	$	6,670	$	(31	)	$	72	$	145		$	6,856


Acquired loans:
Allowance for loan losses:
One- to four-family first mortgage	$	184	$	—		$	—	$	—		$	184
Home equity loans and lines		58		—			—		—			58
Commercial real estate		—		—			—		—			—
Construction and land		—		—			—		—			—
Multi-family residential		—		—			—		—			—
Commercial and industrial		6		—			—		—			6
Consumer		—		—			—		—			—

Total allowance for loan losses	$	248	$	—		$	—	$	—		$	248


Total loans:
Allowance for loan losses:
One- to four-family first mortgage	$	1,088	$	—		$	—	$	32		$	1,120
Home equity loans and lines		424		—			2		5			431
Commercial real estate		2,528		—			—		115			2,643
Construction and land		977		(20	)		—		164			1,121
Multi-family residential		90		—			—		(6	)		84
Commercial and industrial		1,338		—			68		(177	)		1,229
Consumer		473		(11	)		2		12			476

Total allowance for loan losses	$	6,918	$	(31	)	$	72	$	145		$	7,104

Credit quality indicators on the Company’s loan portfolio as of the dates indicated are as follows.


	March 31, 2015
*(dollars in thousands)*	Pass		Special Mention		Substandard		Doubtful		Total
Originated loans:
One- to four-family first mortgage	$	167,100	$	692	$	1,198	$	—	$	168,990
Home equity loans and lines		35,262		429		32		—		35,723
Commercial real estate		283,905		2,721		1,250		—		287,876
Construction and land		78,782		97		1,032		—		79,911
Multi-family residential		18,761		862		—		—		19,623
Commercial and industrial		97,262		35		1,143		—		98,440
Consumer		43,060		64		269		—		43,393

Total loans	$	724,132	$	4,900	$	4,924	$	—	$	733,956


Acquired loans:
One- to four-family first mortgage	$	60,119	$	932	$	4,220	$	—	$	65,271
Home equity loans and lines		18,846		257		513		—		19,616
Commercial real estate		56,765		1,871		8,807		—		67,443
Construction and land		4,021		2,654		2,325		—		9,000
Multi-family residential		8,307		914		1,332		—		10,553
Commercial and industrial		12,618		—		1,104		—		13,722
Consumer		2,451		44		33		—		2,528

Total loans	$	163,127	$	6,672	$	18,334	$	—	$	188,133


Total:
One- to four-family first mortgage	$	227,219	$	1,624	$	5,418	$	—	$	234,261
Home equity loans and lines		54,108		686		545		—		55,339
Commercial real estate		340,670		4,592		10,057		—		355,319
Construction and land		82,803		2,751		3,357		—		88,911
Multi-family residential		27,068		1,776		1,332		—		30,176
Commercial and industrial		109,880		35		2,247		—		112,162
Consumer		45,511		108		302		—		45,921

Total loans	$	887,259	$	11,572	$	23,258	$	—	$	922,089


	December 31, 2014
*(dollars in thousands)*	Pass		Special Mention		Substandard		Doubtful		Total
Originated loans:
One- to four-family first mortgage	$	161,922	$	251	$	2,355	$	—	$	164,528
Home equity loans and lines		33,731		255		499		—		34,485
Commercial real estate		274,878		3,655		1,737		—		280,270
Construction and land		75,888		103		1,066		—		77,057
Multi-family residential		15,642		865		—		—		16,507
Commercial and industrial		88,309		39		1,191		—		89,539
Consumer		42,718		2		329		—		43,049

Total loans	$	693,088	$	5,170	$	7,177	$	—	$	705,435


Acquired loans:
One- to four-family first mortgage	$	62,761	$	1,007	$	4,953	$	—	$	68,721
Home equity loans and lines		20,842		57		616		—		21,515
Commercial real estate		61,172		2,071		9,350		—		72,593
Construction and land		6,407		1		5,689		—		12,097
Multi-family residential		8,175		923		1,770		—		10,868
Commercial and industrial		13,699		—		1,208		—		14,907
Consumer		2,741		40		51		—		2,832

Total loans	$	175,797	$	4,099	$	23,637	$	—	$	203,533


Total:
One- to four-family first mortgage	$	224,683	$	1,258	$	7,308	$	—	$	233,249
Home equity loans and lines		54,573		312		1,115		—		56,000
Commercial real estate		336,050		5,726		11,087		—		352,863
Construction and land		82,295		104		6,755		—		89,154
Multi-family residential		23,817		1,788		1,770		—		27,375
Commercial and industrial		102,008		39		2,399		—		104,446
Consumer		45,459		42		380		—		45,881

Total loans	$	868,885	$	9,269	$	30,814	$	—	$	908,968

The above classifications follow regulatory guidelines and can generally be described as follows:

•

Pass loans are of satisfactory quality.

•

Special mention loans have an existing weakness that could cause future impairment, including the deterioration of financial ratios, past due status, questionable management capabilities and possible reduction in the collateral values.

•

Substandard loans have an existing specific and well-defined weakness that may include poor liquidity and deterioration of financial performance. Such loans may be past due and related deposit accounts experiencing overdrafts. Immediate corrective action is necessary.

•

Doubtful loans have specific weaknesses that are severe enough to make collection or liquidation in full highly questionable and improbable.

In addition, residential loans are classified using an inter-agency regulatory methodology that incorporates the extent of delinquencies and loan-to-value ratios. These classifications were the most current available as of the dates indicated and were generally updated within the quarter.

Age analysis of past due loans as of the dates indicated are as follows.


	March 31, 2015
*(dollars in thousands)*	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days Past Due		Total Past Due		Current Loans		Total Loans
Originated loans:
Real estate loans:
One- to four-family first mortgage	$	927	$	172	$	532	$	1,631	$	167,359	$	168,990
Home equity loans and lines		298		—		31		329		35,394		35,723
Commercial real estate		608		—		777		1,385		286,491		287,876
Construction and land		278		—		—		278		79,633		79,911
Multi-family residential		—		—		—		—		19,623		19,623

Total real estate loans		2,111		172		1,340		3,623		588,500		592,123


Other loans:
Commercial and industrial		1,119		21		418		1,558		96,882		98,440
Consumer		723		140		269		1,132		42,261		43,393

Total other loans		1,842		161		687		2,690		139,143		141,833

Total loans	$	3,953	$	333	$	2,027	$	6,313	$	727,643	$	733,956


Acquired loans:
Real estate loans:
One- to four-family first mortgage	$	2,952	$	521	$	2,355	$	5,828	$	59,443	$	65,271
Home equity loans and lines		183		12		266		461		19,155		19,616
Commercial real estate		108		—		3,858		3,966		63,477		67,443
Construction and land		933		—		662		1,595		7,405		9,000
Multi-family residential		834		—		313		1,147		9,406		10,553

Total real estate loans		5,010		533		7,454		12,997		158,886		171,883


Other loans:
Commercial and industrial		122		150		479		751		12,971		13,722
Consumer		51		1		21		73		2,455		2,528

Total other loans		173		151		500		824		15,426		16,250

Total loans	$	5,183	$	684	$	7,954	$	13,821	$	174,312	$	188,133


Total loans:
Real estate loans:
One- to four-family first mortgage	$	3,879	$	693	$	2,887	$	7,459	$	226,802	$	234,261
Home equity loans and lines		481		12		297		790		54,549		55,339
Commercial real estate		716		—		4,635		5,351		349,968		355,319
Construction and land		1,211		—		662		1,873		87,038		88,911
Multi-family residential		834		—		313		1,147		29,029		30,176

Total real estate loans		7,121		705		8,794		16,620		747,386		764,006


Other loans:
Commercial and industrial		1,241		171		897		2,309		109,853		112,162
Consumer		774		141		290		1,205		44,716		45,921

Total other loans		2,015		312		1,187		3,514		154,569		158,083

Total loans	$	9,136	$	1,017	$	9,981	$	20,134	$	901,955	$	922,089


	December 31, 2014
*(dollars in thousands)*	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days Past Due		Total Past Due		Current Loans		Total Loans
Originated loans:
Real estate loans:
One- to four-family first mortgage	$	2,056	$	90	$	1,058	$	3,204	$	161,324	$	164,528
Home equity loans and lines		434		—		65		499		33,986		34,485
Commercial real estate		1,284		—		829		2,113		278,157		280,270
Construction and land		309		—		—		309		76,748		77,057
Multi-family residential		—		—		—		—		16,507		16,507

Total real estate loans		4,083		90		1,952		6,125		566,722		572,847


Other loans:
Commercial and industrial		271		49		451		771		88,768		89,539
Consumer		924		133		329		1,386		41,663		43,049

Total other loans		1,195		182		780		2,157		130,431		132,588

Total loans	$	5,278	$	272	$	2,732	$	8,282	$	697,153	$	705,435


Acquired loans:
Real estate loans:
One- to four-family first mortgage	$	2,323	$	1,341	$	2,836	$	6,500	$	62,221	$	68,721
Home equity loans and lines		249		97		220		566		20,949		21,515
Commercial real estate		4,551		1		1,840		6,392		66,201		72,593
Construction and land		499		755		702		1,956		10,141		12,097
Multi-family residential		1,052		25		319		1,396		9,472		10,868

Total real estate loans		8,674		2,219		5,917		16,810		168,984		185,794


Other loans:
Commercial and industrial		177		392		336		905		14,002		14,907
Consumer		47		33		41		121		2,711		2,832

Total other loans		224		425		377		1,026		16,713		17,739

Total loans	$	8,898	$	2,644	$	6,294	$	17,836	$	185,697	$	203,533


Total loans:
Real estate loans:
One- to four-family first mortgage	$	4,379	$	1,431	$	3,894	$	9,704	$	223,545	$	233,249
Home equity loans and lines		683		97		285		1,065		54,935		56,000
Commercial real estate		5,835		1		2,669		8,505		344,358		352,863
Construction and land		808		755		702		2,265		86,889		89,154
Multi-family residential		1,052		25		319		1,396		25,979		27,375

Total real estate loans		12,757		2,309		7,869		22,935		735,706		758,641


Other loans:
Commercial and industrial		448		441		787		1,676		102,770		104,446
Consumer		971		166		370		1,507		44,374		45,881

Total other loans		1,419		607		1,157		3,183		147,144		150,327

Total loans	$	14,176	$	2,916	$	9,026	$	26,118	$	882,850	$	908,968

Excluding Acquired Loans with deteriorated credit quality, as of March 31, 2015 and December 31, 2014, the Company did not have any loans greater than 90 days past due and accruing.

The following is a summary of information pertaining to Originated Loans which were deemed to be impaired loans as of the dates indicated.


	As of Period Ended March 31, 2015
*(dollars in thousands)*	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
One- to four-family first mortgage	$	78	$	78	$	—	$	78	$	1
Home equity loans and lines		—		—		—		—		—
Commercial real estate		—		—		—		—		—
Construction and land		—		—		—		—		—
Multi-family residential		—		—		—		—		—
Commercial and industrial		398		398		—		398		6
Consumer		—		—		—		—		—

Total	$	476	$	476	$	—	$	476	$	7


With an allowance recorded:
One- to four-family first mortgage	$	—	$	—	$	—	$	—	$	—
Home equity loans and lines		—		—		—		—		—
Commercial real estate		777		777		107		777		11
Construction and land		—		—		—		—		—
Multi-family residential		—		—		—		—		—
Commercial and industrial		725		725		33		729		10
Consumer		—		—		—		—		—

Total	$	1,502	$	1,502	$	140	$	1,506	$	21


Total impaired Originated Loans:
One- to four-family first mortgage	$	78	$	78	$	—	$	78	$	1
Home equity loans and lines		—		—		—		—		—
Commercial real estate		777		777		107		777		11
Construction and land		—		—		—		—		—
Multi-family residential		—		—		—		—		—
Commercial and industrial		1,123		1,123		33		1,127		16
Consumer		—		—		—		—		—

Total	$	1,978	$	1,978	$	140	$	1,982	$	28


	As of Period Ended December 31, 2014
*(dollars in thousands)*	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
One- to four-family first mortgage	$	78	$	78	$	—	$	214	$	—
Home equity loans and lines		—		—		—		—		—
Commercial real estate		—		—		—		64		—
Construction and land		—		—		—		15		—
Multi-family residential		—		—		—		—		—
Commercial and industrial		398		398		—		494		4
Consumer		—		—		—		—		—

Total	$	476	$	476	$	—	$	787	$	4


With an allowance recorded:
One- to four-family first mortgage	$	—	$	—	$	—	$	—	$	—
Home equity loans and lines		—		—		—		—		—
Commercial real estate		777		777		107		239		10
Construction and land		—		—		—		—		—
Multi-family residential		—		—		—		—		—
Commercial and industrial		730		730		33		923		40
Consumer		—		—		—		—		—

Total	$	1,507	$	1,507	$	140	$	1,162	$	50


Total impaired Originated Loans:
One- to four-family first mortgage	$	78	$	78	$	—	$	214	$	—
Home equity loans and lines		—		—		—		—		—
Commercial real estate		777		777		107		303		10
Construction and land		—		—		—		15		—
Multi-family residential		—		—		—		—		—
Commercial and industrial		1,128		1,128		33		1,417		44
Consumer		—		—		—		—		—

Total	$	1,983	$	1,983	$	140	$	1,949	$	54

A summary of information pertaining to nonaccrual loans as of dates indicated is as follows.


	March 31, 2015						December 31, 2014
*(dollars in thousands)*	Originated		Acquired⁽¹⁾		Total		Originated		Acquired⁽¹⁾		Total
Nonaccrual loans:
One- to four-family first mortgage	$	531	$	4,518	$	5,049	$	1,429	$	5,072	$	6,501
Home equity loans and lines		31		523		554		65		482		547
Commercial real estate		777		5,940		6,717		829		5,498		6,327
Construction and land		—		1,462		1,462		—		5,356		5,356
Multi-family residential		—		1,332		1,332		—		1,770		1,770
Commercial and industrial		1,143		864		2,007		1,191		1,168		2,359
Consumer		270		64		334		329		92		421

Total	$	2,752	$	14,703	$	17,455	$	3,843	$	19,438	$	23,281

⁽¹⁾	Nonaccrual acquired loans accounted for under ASC 310-30 totaled $11.0 million and $15.1 million as of March 31, 2015 and December 31, 2014, respectively.

As of March 31, 2015, the Company was not committed to lend additional funds to any customer whose loan was classified as impaired.

Troubled Debt Restructurings

During the course of its lending operations, the Company periodically grants concessions to its customers in an attempt to protect as much of its investment as possible and to minimize risk of loss. These concessions may include restructuring the terms of a customer loan to alleviate the burden of the customer’s near-term cash requirements. The Company adopted the provisions of ASU No. 2011-02, Receivables (Topic 310): A Creditor’s Determination of Whether a Restructuring is a Troubled Debt Restructuring, which provides clarification on the determination of whether loan restructurings are considered troubled debt restructurings (“TDRs”). In accordance with the ASU, in order to be considered a TDR, the Company must conclude that the restructuring of a loan to a borrower who is experiencing financial difficulties constitutes a “concession”. The Company defines a concession as a modification of existing terms granted to a borrower for economic or legal reasons related to the borrower’s financial difficulties that the Company would otherwise not consider. The concession is either granted through an agreement with the customer or is imposed by a court or by a law. Concessions include modifying original loan terms to reduce or defer cash payments required as part of the loan agreement, including but not limited to:

•

a reduction of the stated interest rate for the remaining original life of the debt,

•

an extension of the maturity date or dates at an interest rate lower than the current market rate for new debt with similar risk characteristics,

•

a reduction of the face amount or maturity amount of the debt, or

•

a reduction of accrued interest receivable on the debt.

In its determination of whether the customer is experiencing financial difficulties, the Company considers numerous indicators, including, but not limited to:

•

whether the customer is currently in default on its existing loan, or is in an economic position where it is probable the customer will be in default on its loan in the foreseeable future without a modification,

•

whether the customer has declared or is in the process of declaring bankruptcy,

•

whether there is substantial doubt about the customer’s ability to continue as a going concern,

•

whether, based on its projections of the customer’s current capabilities, the Company believes the customer’s future cash flows will be insufficient to service the debt, including interest, in accordance with the contractual terms of the existing agreement for the foreseeable future, and

•

whether, without modification, the customer cannot obtain sufficient funds from other sources at an effective interest rate equal to the current market rate for similar debt for a non-troubled debtor.

If the Company concludes that both a concession has been granted and the concession was granted to a customer experiencing financial difficulties, the Company identifies the loan as a TDR. For purposes of the determination of an allowance for loan losses on TDRs, such loans are reviewed for specific impairment in accordance with the Company’s allowance for loan loss methodology. If it is determined that losses are probable on such TDRs, either because of delinquency or other credit quality indicators, the Company specifically allocates a portion of the allowance for loan losses to these loans.

Information about the Company’s TDRs is presented in the following tables.


	As of March 31, 2015
*(dollars in thousands)*	Current		Past Due Greater Than 30 Days		Nonaccrual TDRs		Total TDRs
Originated loans:
Real estate loans:
One- to four-family first mortgage	$	289	$	—	$	—	$	289
Home equity loans and lines		—		—		—		—
Commercial real estate		110		—		—		110
Construction and land		97		—		—		97
Multi-family residential		—		—		—		—

Total real estate loans		496		—		—		496


Other loans:
Commercial and industrial		—		—		725		725
Consumer		—		—		—		—

Total other loans		—		—		725		725

Total loans	$	496	$	—	$	725	$	1,221


Acquired loans:
Real estate loans:
One- to four-family first mortgage	$	—	$	508	$	45	$	553
Home equity loans and lines		—		—		—		—
Commercial real estate		—		—		1,278		1,278
Construction and land		—		—		89		89
Multi-family residential		—		—		—		—

Total real estate loans		—		508		1,412		1,920


Other loans:
Commercial and industrial		—		—		—		—
Consumer		1		—		2		3

Total other loans		1		—		2		3

Total loans	$	1	$	508	$	1,414	$	1,923


Total loans:
Real estate loans:
One- to four-family first mortgage	$	289	$	508	$	45	$	842
Home equity loans and lines		—		—		—		—
Commercial real estate		110		—		1,278		1,388
Construction and land		97		—		89		186
Multi-family residential		—		—		—		—

Total real estate loans		496		508		1,412		2,416


Other loans:
Commercial and industrial		—		—		725		725
Consumer		1		—		2		3

Total other loans		1		—		727		728

Total loans	$	497	$	508	$	2,139	$	3,144


	As of December 31, 2014
*(dollars in thousands)*	Current		Past Due Greater Than 30 Days		Nonaccrual TDRs		Total TDRs
Originated loans:
Real estate loans:
One- to four-family first mortgage	$	—	$	—	$	291	$	291
Home equity loans and lines		—		—		—		—
Commercial real estate		111		—		—		111
Construction and land		103		—		—		103
Multi-family residential		—		—		—		—

Total real estate loans		214		—		291		505


Other loans:
Commercial and industrial		—		—		730		730
Consumer		—		—		—		—

Total other loans		—		—		730		730

Total loans	$	214	$	—	$	1,021	$	1,235


Acquired loans:
Real estate loans:
One- to four-family first mortgage	$	432	$	77	$	49	$	558
Home equity loans and lines		—		—		—		—
Commercial real estate		—		—		967		967
Construction and land		—		—		117		117
Multi-family residential		—		—		—		—

Total real estate loans		432		77		1,133		1,642


Other loans:
Commercial and industrial		—		—		—		—
Consumer		2		—		2		4

Total other loans		2		—		2		4

Total loans	$	434	$	77	$	1,135	$	1,646


Total loans:
Real estate loans:
One- to four-family first mortgage	$	432	$	77	$	340	$	849
Home equity loans and lines		—		—		—		—
Commercial real estate		111		—		967		1,078
Construction and land		103		—		117		220
Multi-family residential		—		—		—		—

Total real estate loans		646		77		1,424		2,147


Other loans:
Commercial and industrial		—		—		730		730
Consumer		2		—		2		4

Total other loans		2		—		732		734

Total loans	$	648	$	77	$	2,156	$	2,881

None of the above referenced TDRs defaulted subsequent to the restructuring through the date the financial statements were issued. The Company restructured, as a TDR, one loan totaling $341,000 during the first quarter of 2015.

6. Fair Value Measurements and Disclosures

The Company utilizes fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. The Company groups assets and liabilities measured or disclosed at fair value in three levels as required by ASC 820, Fair Value Measurements and Disclosures. Under this guidance, fair value should be based on the assumptions market participants would use when pricing the asset or liability and establishes a fair value hierarchy that prioritizes the inputs used to develop those assumptions and measure fair value. The hierarchy requires companies to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels used to measure fair value are as follows:

•

Level 1 – Quoted prices in active markets for identical assets or liabilities.

•

Level 2 – Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

•

Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.

An asset’s or liability’s categorization within the fair value hierarchy is based upon the lowest level that is significant to the fair value measurement. Management reviews and updates the fair value hierarchy classifications of the Company’s assets and liabilities quarterly.

Recurring Basis

Investment Securities Available for Sale

Fair values of investment securities available for sale are primarily measured using information from a third-party pricing service. This pricing service provides pricing information by utilizing pricing models supported with market data information. Standard inputs include benchmark yields, reported trades, broker/dealer quotes, issuer spreads, benchmark securities bids, offers and other reference data from market research publications. If quoted prices are available in an active market, investment securities are classified as Level 1 measurements. If quoted prices are not available in an active market, fair values are estimated primarily by the use of pricing models. Level 2 investment securities are primarily comprised of mortgage-backed securities issued by government agencies and U.S. government-sponsored enterprises. In certain cases, where there is limited or less transparent information provided by the Company’s third-party pricing service, fair value is estimated by the use of secondary pricing services or through the use of non-binding third-party broker quotes. Investment securities are classified within Level 3 when little or no market activity supports the fair value.

Management primarily identifies investment securities which may have traded in illiquid or inactive markets by identifying instances of a significant decrease in the volume and frequency of trades, relative to historical levels, as well as instances of a significant widening of the bid-ask spread in the brokered markets. Investment securities that are deemed to have been trading in illiquid or inactive markets may require the use of significant unobservable inputs. For example, management may use quoted prices for similar investment securities in the absence of a liquid and active market for the investment securities being valued. As of March 31, 2015, management did not make adjustments to prices provided by the third-party pricing service as a result of illiquid or inactive markets.

The following tables present the balances of assets and liabilities measured for fair value on a recurring basis as of March 31, 2015 and December 31, 2014.


			Fair Value Measurements Using
*(dollars in thousands)*	March 31, 2015		Level 1		Level 2		Level 3
Available for sale securities:
U.S. agency mortgage-backed	$	119,068	$	—	$	119,068	$	—
Non-U.S. agency mortgage-backed		7,363		—		7,363		—
Municipal bonds		24,344		—		24,344		—
U.S. government agency		20,714		—		20,714		—

Total	$	171,489	$	—	$	171,489	$	—


			Fair Value Measurements Using
*(dollars in thousands)*	December 31, 2014		Level 1		Level 2		Level 3
Available for sale securities:
U.S. agency mortgage-backed	$	121,498	$	—	$	121,498	$	—
Non-U.S. agency mortgage-backed		7,764		—		7,764		—
Municipal bonds		24,896		—		24,896		—
U.S. government agency		20,643		—		20,643		—

Total	$	174,801	$	—	$	174,801	$	—

The Company did not record any liabilities at fair value for which measurement of the fair value was made on a recurring basis.

Nonrecurring Basis

In accordance with the provisions of ASC 310, Receivables, the Company records loans considered impaired at fair value. A loan is considered impaired if it is probable the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. Fair value is measured at the fair value of the collateral for collateral-dependent loans. For non-collateral-dependent loans, fair value is measured by present valuing expected future cash flows. Impaired loans are classified as Level 3 assets when measured using appraisals from external parties of the collateral less any prior liens and when there is no observable market price. Repossessed assets are initially recorded at fair value less estimated costs to sell. The fair value of repossessed assets is based on property appraisals and an analysis of similar properties available. As such, the Company classifies repossessed assets as Level 3 assets.

Acquired loans, acquired FHLB advances, and acquired interest-bearing deposit liabilities are measured on a nonrecurring basis using significant unobservable inputs (Level 3).

The Company has segregated all financial assets and liabilities that are measured at fair value on a nonrecurring basis into the most appropriate level within the fair value hierarchy based on the inputs used to determine the fair value at the measurement date in the table below.


			Fair Value Measurements Using
*(dollars in thousands)*	March 31, 2015		Level 1		Level 2		Level 3

Assets
Acquired loans with deteriorated credit quality	$	26,347	$	—	$	—	$	26,347
Acquired loans without deteriorated credit quality		161,367		—		—		161,367
Impaired loans, excluding acquired loans		1,838		—		—		1,838
Repossessed assets		4,877		—		—		4,877

Total	$	194,429	$	—	$	—	$	194,429


Liabilities
Deposits acquired through business combinations	$	64,752	$	—	$	—	$	64,752
Securities sold under repurchase agreement		20,205		—		—		20,205

Total	$	84,957	$	—	$	—	$	84,957


			Fair Value Measurements Using
*(dollars in thousands)*	December 31, 2014		Level 1		Level 2		Level 3

Assets
Acquired loans with deteriorated credit quality	$	31,908	$	—	$	—	$	31,908
Acquired loans without deteriorated credit quality		171,206		—		—		171,206
Impaired loans, excluding acquired loans		1,843		—		—		1,843
Repossessed assets		5,214		—		—		5,214

Total	$	210,171	$	—	$	—	$	210,171


Liabilities
Deposits acquired through business combinations	$	69,178	$	—	$	—	$	69,178
Securities sold under repurchase agreement		20,371		—		—		20,371

Total	$	89,549	$	—	$	—	$	89,549

ASC 820, Fair Value Measurements and Disclosures, requires the disclosure of each class of financial instruments for which it is practicable to estimate. The fair value of a financial instrument is the current amount that would be exchanged between willing parties, other than in a forced liquidation. Fair value is best determined based upon quoted market prices. However, in many instances, there are no quoted market prices for the Company’s various financial instruments. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. Accordingly, the fair value estimates may not be realized in an immediate settlement of the instrument. ASC 820 excludes certain financial instruments and all non-financial instruments from its disclosure requirements. Accordingly, the aggregate fair value amounts presented may not necessarily represent the underlying fair value of the Company.

Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial statements. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

Fair value estimates included herein are based on existing on- and off-balance-sheet financial instruments without attempting to estimate the value of anticipated future business and the fair value of assets and liabilities that are not required to be recorded or disclosed at fair value like premises and equipment. In addition, the tax ramifications related to the realization of the unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in the estimates.

The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate that value:

The carrying value of cash and cash equivalents and interest-bearing deposits in banks approximate their fair value.

The fair value for investment securities is determined from quoted market prices when available. If a quoted market price is not available, fair value is estimated using third party pricing services or quoted market prices of securities with similar characteristics.

The carrying value of mortgage loans held for sale approximates their fair value.

The fair value of loans is estimated by discounting the future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturity.

The cash surrender value of bank-owned life insurance (“BOLI”) approximates its fair value.

The fair value of the FDIC loss sharing receivable is determined by discounting projected cash flows from loss sharing agreements based on expected reimbursements for losses at the applicable loss sharing percentages based on the terms of the loss sharing agreements.

The fair value of customer deposits, excluding certificates of deposit, is the amount payable on demand. The fair value of fixed-maturity certificates of deposit is estimated by discounting the future cash flows using the rates currently offered for deposits of similar remaining maturities.

The fair value of short-term FHLB advances is the amount payable at maturity. The fair value of long-term FHLB advances is estimated by discounting the future cash flows using the rates currently offered for advances of similar maturities.

The carrying value of the securities sold under repurchase agreement is its fair value.

The following table presents estimated fair values of the Company’s financial instruments as of the dates indicated.


			Fair Value Measurements at March 31, 2015
*(dollars in thousands)*	Carrying Amount		Total		Level 1		Level 2		Level 3

Financial Assets
Cash and cash equivalents	$	30,176	$	30,176	$	30,176	$	—	$	—
Interest-bearing deposits in banks		5,526		5,526		5,526		—		—
Investment securities available for sale		171,489		171,489		—		171,489		—
Investment securities held to maturity		13,913		14,141		—		14,141		—
Mortgage loans held for sale		5,623		5,623		—		5,623		—
Loans, net		913,817		920,550		—		—		920,550
Cash surrender value of BOLI		19,295		19,295		19,295		—		—
FDIC loss sharing receivable		3,552		3,552		—		—		3,552

Financial Liabilities
Deposits	$	1,026,573	$	1,027,316	$	—	$	962,564	$	64,752
Short-term FHLB advances		6,000		6,000		6,000		—		—
Long-term FHLB advances		19,000		19,499		—		19,499		—
Securities sold under repurchase agreement		20,205		20,205		—		—		20,205

			Fair Value Measurements at December 31, 2014
*(dollars in thousands)*	Carrying Amount		Total		Level 1		Level 2		Level 3

Financial Assets
Cash and cash equivalents	$	29,078	$	29,078	$	29,078	$	—	$	—
Interest-bearing deposits in banks		5,526		5,526		5,526		—		—
Investment securities available for sale		174,801		174,801		—		174,801		—
Investment securities held to maturity		11,705		11,889		—		11,889		—
Mortgage loans held for sale		4,517		4,517		—		4,517		—
Loans, net		901,208		908,346		—		—		908,346
Cash surrender value of BOLI		19,163		19,163		19,163		—		—
FDIC loss sharing receivable		4,589		4,589		—		—		4,589

Financial Liabilities
Deposits	$	993,573	$	993,994	$	—	$	924,816	$	69,178
Short-term FHLB advances		31,000		31,000		31,000		—		—
Long-term FHLB advances		16,500		16,987		—		16,987		—
Securities sold under repurchase agreement		20,371		20,371		—		—		20,371

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The purpose of this discussion and analysis is to focus on significant changes in the financial condition of Home Bancorp, Inc. (the “Company”) and its wholly owned subsidiary, Home Bank, N. A. (the “Bank”), from December 31, 2014 through March 31, 2015 and on its results of operations for the three months ended March 31, 2015 and March 31, 2014. This discussion and analysis is intended to highlight and supplement information presented elsewhere in this quarterly report on Form 10-Q, particularly the consolidated financial statements and related notes appearing in Item 1.

Forward-Looking Statements

To the extent that statements in this Form 10-Q relate to future plans, objectives, financial results or performance of the Company or Bank, these statements are deemed to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements, which are based on management’s current information, estimates and assumptions and the current economic environment, are generally identified by the use of words such as “plan”, “believe”, “expect”, “intend”, “anticipate”, “estimate”, “project” or similar expressions, or by future or conditional terms such as “will”, “would”, “should”, “could”, “may”, “likely”, “probably”, or “possibly”. The Company’s or the Bank’s actual strategies and results in future periods may differ materially from those currently expected due to various risks and uncertainties. Factors that may cause actual results to differ materially from these forward-looking statements include, but are not limited to, the risk factors described under the heading “Risk Factors” in the Company’s Annual Report on Form 10-K filed with the Securities Exchange Commission (“SEC”) for the year ended December 31, 2014. The Company undertakes no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date on which such statements were made.

EXECUTIVE OVERVIEW

During the first quarter of 2015, the Company earned $2.8 million, an increase of $1.4 million, or 98.7%, compared to the first quarter of 2014. Diluted earnings per share for the first quarter of 2015 were $0.41, an increase of $0.20 per share, or 95.2%, compared to the first quarter of 2014. The first quarter of 2014 included $2.0 million of pre-tax expenses related to the acquisition of Britton & Koontz Capital Corporation (“Britton & Koontz”) in February 2014. Excluding merger-related expenses, net income for the first quarter of 2015 increased 2% compared to the first quarter of 2014. Excluding merger-related expenses, diluted earnings per share for the first quarter of 2015 were virtually identical to the first quarter of 2014.

Key components of the Company’s performance during the three months ended March 31, 2015 are summarized below.

•

Assets totaled $1.2 billion as of March 31, 2015, up $12.4 million, or 1.0%, from December 31, 2014. The increase was primarily the result of a $13.1 million increase in loans.

•

Loans as of March 31, 2015 were $922.1 million, an increase of $13.1 million, or 1.4%, from December 31, 2014. The increase was primarily the result of increases in commercial and industrial (up $7.7 million), multifamily residential ($2.8 million) and commercial real estate loans ($2.5 million) during the first quarter of 2015.

•

Deposits as of March 31, 2015 were $1.0 billion, an increase of $33.0 million, or 3.3%, from December 31, 2014. Core deposits (i.e., checking, savings, and money market accounts) totaled $810.6 million as of March 31, 2015, an increase of $37.8 million, or 4.9%, from December 31, 2014. The increase in core deposits was primarily driven by a $24.3 million increase in NOW accounts.

•

The Company purchased 83,193 shares of its common stock during the first quarter of 2015 at an average price per share of $21.64. As of March 31, 2015, an additional 85,250 shares remain eligible for purchase under the share repurchase plan announced in June 2013.

•

Interest income increased $738,000, or 5.9%, in the first quarter of 2015 compared to the first quarter of 2014. The increase was primarily due to increased average loan volume.

•

Interest expense increased $57,000, or 7.6%, for the first quarter of 2015 compared to the first quarter of 2014. The increase in the first quarter 2015 compared to the first quarter 2014 was primarily due to a slight increase in the cost of funds as the result of a change in the mix of interest bearing liabilities.

•

The provision for loan losses totaled $538,000 for the first quarter of 2015, an increase of $393,000, or 271.3%, compared to the first quarter of 2014. At March 31, 2015, the Company’s ratio of allowance for loan losses to total loans was 0.90%, compared to 0.81% at March 31, 2014. Excluding acquired loans, the ratio of the allowance for loan losses to total loans was 1.07% at March 31, 2015, compared to 1.10% at March 31, 2014. Net loan charge-offs for the first three months of 2015 were $26,000 compared to net loan recoveries of $41,000 during the first three months of 2014.

•

Noninterest income for the first quarter of 2015 increased $423,000, or 25.5%, compared to the first quarter of 2014, due primarily to increases in gain on sale of loans (up $211,000), bank card fees (up $110,000) and service fees and charges (up $96,000).

•

Noninterest expense for the first quarter of 2015 decreased $1.5 million, or 13.7%, compared to the first quarter of 2014. Noninterest expense for the first three months of 2014 includes $2.0 million of merger-related expenses associated with the acquisition of Britton & Koontz in February 2014. Excluding merger-related expenses, noninterest expense for the first quarter of 2015 totaled $9.7 million, an increase of $417,000, or 4.5%, compared to the first quarter of 2014. The increase in noninterest expense resulted primarily due to the addition of Britton & Koontz branches and employees.

The discussion and analysis contains financial information other than in accordance with generally accepted accounting principles (“GAAP”). The Company uses these non-GAAP financial measures in their analysis of the Company’s performance. Reconciliation of GAAP to non-GAAP disclosures is included in the table below.

Non-GAAP Reconciliation


	For the Three Months Ended
*(dollars in thousands)*	March 31, 2015		March 31, 2014

Reported noninterest expense	$	9,719	$	11,257
Less: Merger-related expenses		—		(1,955	)

Non-GAAP noninterest expense	$	9,719	$	9,302


Reported net income	$	2,848	$	1,433
Add: Merger-related expenses (after tax)		—		1,357

Non-GAAP net income	$	2,848	$	2,790


Diluted EPS	$	0.41	$	0.21
Add: Merger-related expenses		—		0.20

Non-GAAP EPS	$	0.41	$	0.41

FINANCIAL CONDITION

Loans, Asset Quality and Allowance for Loan Losses

Loans – Loans outstanding as of March 31, 2015 were $922.1 million, an increase of $13.1 million, or 1.4%, from December 31, 2014. The increase was primarily the result of increases in commercial and industrial (up $7.7 million), multifamily residential ($2.8 million) and commercial real estate loans ($2.5 million).

The following table summarizes the composition of the Company’s loan portfolio as of the dates indicated.


	March 31,		December 31,		Increase/(Decrease)
*(dollars in thousands)*	2015		2014		Amount			Percent
Real estate loans:
One- to four-family first mortgage	$	234,261	$	233,249	$	1,012			0.4	%
Home equity loans and lines		55,339		56,000		(661	)		(1.2	)
Commercial real estate		355,319		352,863		2,456			0.7
Construction and land		88,911		89,154		(243	)		(0.3	)
Multi-family residential		30,176		27,375		2,801			10.2

Total real estate loans		764,006		758,641		5,365			0.7

Other loans:
Commercial and industrial		112,162		104,446		7,716			7.4
Consumer		45,921		45,881		40			0.1

Total other loans		158,083		150,327		7,756			5.2

Total loans	$	922,089	$	908,968	$	13,121			1.4	%

Asset Quality – One of management’s key objectives has been, and continues to be, maintaining a high level of asset quality. In addition to maintaining credit standards for new loan originations, we proactively monitor loans and collection and workout processes of delinquent or problem loans. When a borrower fails to make a scheduled payment, we attempt to cure the deficiency by making personal contact with the borrower. Initial contacts are generally made within 10 days after the date the payment is due. In most cases, deficiencies are promptly resolved. If the delinquency continues, late charges are assessed and additional efforts are made to collect the deficiency. All loans which are designated as “special mention,” classified or which are delinquent 90 days or more are reported to the Board of Directors of the Bank monthly. For loans where the collection of principal or interest payments is doubtful, the accrual of interest income ceases. It is our policy, with certain limited exceptions, to discontinue accruing interest and reverse any interest accrued on any loan which is 90 days or more past due. On occasion, this action may be taken earlier if the financial condition of the borrower raises significant concern with regard to his/her ability to service the debt in accordance with the terms of the loan agreement. Interest income is not accrued on these loans until the borrower’s financial condition and payment record demonstrate an ability to service the debt.

Repossessed assets which are acquired as a result of foreclosure are classified as repossessed assets until sold. Third party property valuations are obtained at the time the asset is repossessed and periodically until the property is liquidated. Repossessed assets are recorded at the lesser of the balance of the loan or fair value less estimated selling costs, at the date acquired or upon receiving new property valuations. Costs associated with acquiring and improving a foreclosed property are usually capitalized to the extent that the carrying value does not exceed fair value less estimated selling costs. Holding costs are charged to expense. Gains and losses on the sale of repossessed assets are charged to operations, as incurred.

An impaired loan generally is one for which it is probable, based on current information, that the lender will not collect all the amounts due under the contractual terms of the loan. Large groups of smaller balance, homogeneous loans are collectively evaluated for impairment. Loans collectively evaluated for impairment include smaller balance commercial loans, residential real estate loans and consumer loans. These loans are evaluated as a group because they have similar characteristics and performance experience. Larger (i.e., loans with balances of $100,000 or greater) commercial real estate, multi-family residential, construction and land loans and commercial and industrial loans are individually evaluated for impairment. Third party property valuations are obtained at the time of origination for real estate secured loans. When a determination is made that a loan has deteriorated to the point of becoming a problem loan, updated valuations may be ordered to help determine if there is impairment, which may lead to a recommendation for partial charge off or appropriate allowance allocation. Property valuations are ordered through, and are reviewed by, an appraisal officer. The Company typically orders an “as is” valuation for collateral property if the loan is in a criticized loan classification. The Board of Directors is provided with monthly reports on impaired loans. As of March 31, 2015 and December 31, 2014, loans individually evaluated for impairment, excluding acquired loans, amounted to $2.0 million. As of

March 31, 2015 and December 31, 2014, substandard loans, excluding acquired loans, amounted to $4.9 million and $7.2 million, respectively. The amount of the allowance for loan losses allocated to impaired or substandard loans originated by Home Bank totaled $140,000 as of March 31, 2015 and December 31, 2014. There were no assets classified as doubtful or loss as of March 31, 2015 and December 31, 2014.

Federal regulations and our policies require that we utilize an internal asset classification system as a means of reporting problem and potential problem assets. We have incorporated an internal asset classification system, substantially consistent with Federal banking regulations, as a part of our credit monitoring system. Federal banking regulations set forth a classification scheme for problem and potential problem assets as “substandard,” “doubtful” or “loss” assets. An asset is considered “substandard” if it is inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. “Substandard” assets include those characterized by the “distinct possibility” that the insured institution will sustain “some loss” if the deficiencies are not corrected. Assets classified as “doubtful” have all of the weaknesses inherent in those classified “substandard” with the added characteristic that the weaknesses present make “collection or liquidation in full,” on the basis of currently existing facts, conditions and values, “highly questionable and improbable.” Assets classified as “loss” are those considered “uncollectible” and of such little value that their continuance as assets without the establishment of a specific loss reserve is not warranted.

A bank’s determination as to the classification of its assets and the amount of its valuation allowances is subject to review by Federal bank regulators which can order the establishment of additional general or specific loss allowances. The Federal banking agencies have adopted an interagency policy statement on the allowance for loan and lease losses. The policy statement provides guidance for financial institutions on both the responsibilities of management for the assessment and establishment of allowances and guidance for banking agency examiners to use in determining the adequacy of general valuation guidelines. Generally, the policy statement recommends that institutions have effective systems and controls to identify, monitor and address asset quality problems; that management analyzes all significant factors that affect the collectability of the portfolio in a reasonable manner; and that management establishes acceptable allowance evaluation processes that meet the objectives set forth in the policy statement. Our management believes that, based on information currently available, our allowance for loan losses is maintained at a level which covers all known and inherent losses that are both probable and reasonably estimable as of each reporting date. However, actual losses are dependent upon future events and, as such, further additions to the level of allowance for loan losses may become necessary.

Real estate, or other collateral, which is acquired as a result of foreclosure is classified as a foreclosed asset until sold. Foreclosed assets are recorded at the lesser of the balance of the loan or fair value less estimated selling costs, at the date acquired or upon receiving new property valuations. Holding costs are charged to expense. Gains and losses on the sale of real estate owned are charged to operations, as incurred.

The following table sets forth the composition of the Company’s nonperforming assets (“NPAs”) and troubled debt restructurings as of the dates indicated.


	March 31, 2015							December 31, 2014
*(dollars in thousands)*	Originated		Acquired⁽¹⁾		Total			Originated		Acquired⁽¹⁾		Total
Nonaccrual loans:
Real estate loans:
One- to four-family first mortgage	$	531	$	4,518	$	5,049		$	1,429	$	5,072	$	6,501
Home equity loans and lines		31		523		554			65		482		547
Commercial real estate		777		5,940		6,717			829		5,498		6,327
Construction and land		—		1,462		1,462			—		5,356		5,356
Multi-family residential		—		1,332		1,332			—		1,770		1,770
Other loans:
Commercial and industrial		1,143		864		2,007			1,191		1,168		2,359
Consumer		270		64		334			329		92		421

Total nonaccrual loans		2,752		14,703		17,455			3,843		19,438		23,281
Accruing loans 90 days or more past due		—		—		—			—		—		—

Total nonperforming loans		2,752		14,703		17,455			3,843		19,438		23,281
Foreclosed assets		1,886		2,991		4,877			1,835		3,380		5,215

Total nonperforming assets		4,638		17,694		22,332			5,678		22,818		28,496
Performing troubled debt restructurings		496		508		1,004			214		510		724

Total nonperforming assets and troubled debt restructurings	$	5,134	$	18,202	$	23,336		$	5,892	$	23,328	$	29,220

Nonperforming loans to total loans						1.89	%						2.56	%
Nonperforming loans to total assets						1.41	%						1.91	%
Nonperforming assets to total assets						1.81	%						2.33	%

⁽¹⁾

Includes $11.0 million and $15.1 million in acquired loans accounted for under ASC 310-30 at March 31, 2015 and December 31, 2014, respectively. Excluding acquired loans and assets, ratios for nonperforming loans to total loans, nonperforming loans to total assets and nonperforming assets to total assets were 0.37%, 0.26% and 0.44%, respectively, at March 31, 2015.

Net loan charge-offs for the first quarter of 2015 were $26,000, compared to net loan recoveries of $41,000 for the first quarter of 2014.

Allowance for Loan Losses – The allowance for loan losses is established through provisions for loan losses. The Company maintains the allowance at a level believed, to the best of management’s knowledge, to cover all known and inherent losses in the portfolio that are both probable and reasonable to estimate at each reporting date. Management reviews the allowance for loan losses at least quarterly in order to identify those inherent losses and to assess the overall collection probability for the loan portfolio. The evaluation process includes, among other things, an analysis of delinquency trends, nonperforming loan trends, the level of charge-offs and recoveries, prior loss experience, total loans outstanding, the volume of loan originations, the type, size and geographic concentration of loans, the value of collateral securing loans, the borrower’s ability to repay and repayment performance, the number of loans requiring heightened management oversight, economic conditions and industry experience. Based on this evaluation, management assigns risk ratings to segments of the loan portfolio. Such risk ratings are periodically reviewed by management and revised as deemed appropriate. These efforts are supplemented by reviews and validations performed by independent loan reviewers. The results of the reviews are reported to the Audit Committee of the Board of Directors. The establishment of the allowance for loan losses is significantly affected by management judgment. There is likelihood that different amounts would be reported under different conditions or assumptions. Federal regulatory agencies, as an integral part of their examination process, periodically review our allowance for loan losses. Such agencies may require management to make additional provisions for estimated loan losses based upon judgments different from those of management.

With respect to acquired loans, the Company follows the reserve standard set forth in ASC 310, Receivables. At acquisition, the Company reviews each loan to determine whether there is evidence of deterioration in credit quality since origination and if it is probable that the Company will be unable to collect all amounts due according to the loan’s contractual terms. The Company considers expected prepayments and estimates the amount and timing of undiscounted expected principal, interest and other cash flows for each loan pool meeting the criteria above, and determines the excess of the loan pool’s scheduled contractual principal and interest payments in excess of cash flows expected at acquisition as an amount that should not be accreted (nonaccretable difference). The remaining amount, representing the excess of the pool’s cash flows expected to be collected over the fair value, is accreted into interest income over the remaining life of the pool (accretable yield). The Company records a discount on these loans at acquisition to record them at their estimated fair values. As a result, acquired loans subject to ASC 310 are excluded from the calculation of the allowance for loan losses as of the acquisition date. See Note 6 to the Unaudited Consolidated Financial Statements for additional information concerning our allowance for Acquired loans.

Acquired loans were recorded at their acquisition date fair value, which was based on expected cash flows and included an estimation of expected future loan losses. Under current accounting principles, if the Company determines that losses arose after the acquisition date, the additional losses will be reflected as a provision to the allowance for loan losses. As of both March 31, 2015 and December 31, 2014, $124,000 of our allowance for loan losses was allocated to acquired loans with deteriorated credit quality.

We will continue to monitor and modify our allowance for loan losses as conditions warrant. No assurance can be given that our level of allowance for loan losses will cover all of the inherent losses on our loans or that future adjustments to the allowance for loan losses will not be necessary if economic and other conditions differ substantially from the conditions used by management to determine the current level of the allowance for loan losses.

The following table presents the activity in the allowance for loan losses during the first three months of 2015.


*(dollars in thousands)*	Originated			Acquired		Total

Balance, December 31, 2014	$	7,342		$	418	$	7,760
Provision charged to operations		538			—		538
Loans charged off		(59	)		—		(59	)
Recoveries on charged off loans		33			—		33

Balance, March 31, 2015	$	7,854		$	418	$	8,272

At March 31, 2015, the Company’s ratio of allowance for loan losses to total loans was 0.90%, compared to 0.85% and 0.81% at December 31, 2014 and March 31, 2014, respectively. Excluding acquired loans, the ratio of allowance for loan losses to total loans was 1.07% at March 31, 2015, compared to 1.04% and 1.10% at December 31, 2014 and March 31, 2014, respectively.

Investment Securities

The Company’s investment securities portfolio totaled $185.4 million as of March 31, 2015, a decrease of $1.1 million, or 0.6%, from December 31, 2014. As of March 31, 2015, the Company had a net unrealized gain on its available for sale investment securities portfolio of $2.6 million, compared to $2.0 million as of December 31, 2014. The investment securities portfolio had a modified duration of 3.4 and 3.8 years at March 31, 2015 and December 31, 2014, respectively.

The following table summarizes activity in the Company’s investment securities portfolio during the first three months of 2015.


*(dollars in thousands)*	Available for Sale			Held to Maturity

Balance, December 31, 2014	$	174,801		$	11,705
Purchases		3,127			2,274
Sales		—			—
Principal payments and calls		(6,768	)		—
Accretion of discounts and amortization of premiums, net		(287	)		(66	)
Increase in market value		616			—

Balance, March 31, 2015	$	171,489		$	13,913

Funding Sources

Deposits – Deposits totaled $1.0 billion as of March 31, 2015, an increase of $33.0 million, or 3.3%, compared to December 31, 2014. Core deposits totaled $810.6 million as of March 31, 2015, an increase of $37.8 million, or 4.9%, compared to December 31, 2014. The increase was related primarily to NOW accounts (up $24.3 million) and demand deposit accounts (up $8.7 million).

The following table sets forth the composition of the Company’s deposits at the dates indicated.


	March 31,		December 31,		Increase (Decrease)
*(dollars in thousands)*	2015		2014		Amount			Percent

Demand deposit	$	276,319	$	267,660	$	8,659			3.2	%
Savings		83,568		81,145		2,423			3.0
Money market		221,949		219,456		2,493			1.1
NOW		228,806		204,536		24,270			11.9
Certificates of deposit		215,931		220,775		(4,844	)		(2.2	)

Total deposits	$	1,026,573	$	993,572	$	33,001			3.3	%

Federal Home Loan Bank Advances – Short-term FHLB advances totaled $6.0 million as of March 31, 2015, compared to $31.0 million as of December 31, 2014. Long-term FHLB advances totaled $19.0 million as of March 31, 2015 compared to $16.5 million as of December 31, 2014.

Securities Sold Under Repurchase Agreements – Securities sold under repurchase agreements totaled $20.2 million as of March 31, 2015 with a July 2015 maturity date and an effective interest rate of 0.36%. The underlying securities are U.S. Government obligations and obligations of other U.S. Government agencies. At March 31, 2015, these securities had coupon rates ranging from 1.25% to 3.75% and maturity dates ranging from 2016 to 2028

Shareholders’ Equity – Shareholders’ equity increased $2.6 million, or 1.7%, from $154.1 million as of December 31, 2014 to $156.8 million as of March 31, 2015. The increase was primarily the result of retained earnings (up $2.3 million).

As of March 31, 2015, the Company had regulatory capital that was well in excess of regulatory requirements. The following table details the Company’s actual levels and current regulatory capital requirements as of March 31, 2015.


	Actual					Required for Capital Adequacy Purposes					To Be Well Capitalized Under Prompt Corrective Action Provisions
*(dollars in thousands)*	Amount		Ratio			Amount		Ratio			Amount		Ratio

Tier 1 risk-based capital	$	151,323		17.37	%	$	34,846		4.00	%	$	52,268		6.00	%
Common equity tier 1 capital		151,323		17.37			39,201		4.50			56,624		6.50
Total risk-based capital		159,595		18.32			69,691		8.00			87,114		10.00
Tier 1 leverage capital		151,323		12.38			48,899		4.00			61,123		5.00
Tangible capital		151,323		12.38			18,337		1.50			N/A		N/A

LIQUIDITY AND ASSET/LIABILITY MANAGEMENT

Liquidity Management

Liquidity management encompasses our ability to ensure that funds are available to meet the cash flow requirements of depositors and borrowers, while also ensuring adequate cash flow exists to meet the Company’s needs, including operating, strategic and capital. The Company develops its liquidity management strategies as part of its overall asset/liability management process. Our primary sources of funds are from deposits, amortization of loans, loan prepayments and the maturity of loans, investment securities and other investments, and other funds provided from operations. While scheduled payments from the amortization of loans and investment securities and maturing investment securities are relatively predictable sources of funds, deposit flows and loan prepayments can be greatly influenced by general interest rates, economic conditions and competition. The Company also maintains excess funds in short-term, interest-bearing assets that provide additional liquidity. As of March 31, 2015, cash and cash equivalents totaled $30.2 million. At such date, investment securities available for sale totaled $171.5 million.

The Company uses its liquidity to fund existing and future loan commitments, to fund maturing certificates of deposit and demand deposit withdrawals, to invest in other interest-earning assets, and to meet operating expenses. As of March 31, 2015, certificates of deposit maturing within the next 12 months totaled $155.2 million. Based upon historical experience, the Company anticipates that a significant portion of the maturing certificates of deposit will be redeposited with us. For the three months ended March 31, 2015, the average balance of our outstanding FHLB advances was $35.4 million. As of March 31, 2015, the Company had $25.0 million in total outstanding FHLB advances and had $419.7 million in additional FHLB advances available.

In addition to cash flow from loan and securities payments and prepayments as well as from sales of securities available for sale, the Company has significant borrowing capacity available to fund liquidity needs. In recent years, the Company has utilized borrowings as a cost efficient addition to deposits as a source of funds. Our borrowings consist of advances from the FHLB of Dallas, of which the Company is a member. Under terms of the collateral agreement with the FHLB, the Company pledges residential mortgage loans and investment securities as well as the Company’s stock in the FHLB as collateral for such advances.

Asset/Liability Management

The objective of asset/liability management is to implement strategies for the funding and deployment of the Company’s financial resources that are expected to maximize soundness and profitability over time at acceptable levels of risk. Interest rate sensitivity is the potential impact of changing rate environments on both net interest income and cash flows. The Company measures its interest rate sensitivity over the near term primarily by running net interest income simulations.

Our interest rate sensitivity also is monitored by management through the use of a model which generates estimates of the change in its net interest income over a range of interest rate scenarios. Based on the Company’s interest rate risk model, the table below sets forth the results of immediate and sustained changes in interest rates as of March 31, 2015.

The actual impact of changes in interest rates will depend on many factors. These factors include the Company’s ability to achieve expected growth in earning assets and maintain a desired mix of earning assets and interest-bearing liabilities, the actual timing of asset and liability repricings, the magnitude of interest rate changes and corresponding movement in interest rate spreads, and the level of success of asset/liability management strategies.

Off-Balance Sheet Activities

To meet the financing needs of its customers, the Bank issues financial instruments which represent conditional obligations that are not recognized, wholly or in part, in the statements of financial condition. These financial instruments include commitments to extend credit and standby letters of credit. Such instruments expose the Company to varying degrees of credit and interest rate risk in much the same way as funded loans. The same credit policies are used in these commitments as for on-balance sheet instruments. The Company’s exposure to credit losses from these financial instruments is represented by their contractual amounts.

The following table summarizes our outstanding commitments to originate loans and to advance additional amounts pursuant to outstanding letters of credit, lines of credit and undisbursed construction loans as of March 31, 2015 and December 31, 2014.


	Contract Amount
	March 31,		December 31,
*(dollars in thousands)*	2015		2014

Standby letters of credit	$	5,125	$	5,405
Available portion of lines of credit		110,814		107,242
Undisbursed portion of loans in process		46,030		54,200
Commitments to originate loans		87,908		96,506

Commitments to 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. Since many of the commitments are expected to be drawn upon, the total commitment amounts generally represent future cash requirements.

Unfunded commitments under commercial lines of credit, revolving credit lines and overdraft protection agreements are commitments for possible future extensions of credit to existing customers. These lines of credit usually do not contain a specified maturity date and may not be drawn upon to the total extent to which the Company is committed.

The Company is subject to certain claims and litigation arising in the ordinary course of business. In the opinion of management, after consultation with legal counsel, the ultimate disposition of these matters is not expected to have a material effect on the financial condition or results of operations of the Company.

RESULTS OF OPERATIONS

During the first quarter of 2015, the Company earned $2.8 million, an increase of $1.4 million, or 98.7%, compared to the first quarter of 2014. Diluted earnings per share for the first quarter of 2015 were $0.41, an increase of $0.20 per share, or 95.2%, compared to the first quarter of 2014. Excluding merger-related expenses from the first quarter of 2014, net income for the first quarter of 2015 increased 2% compared to the first quarter of 2014. Excluding merger-related expenses, diluted earnings per share for the first quarter of 2015 were virtually identical to the first quarter of 2014.

Net Interest Income – Net interest income is the difference between the interest income earned on interest-earning assets, such as loans and investment securities, and the interest expense paid on interest-bearing liabilities, such as deposits and borrowings. The Company’s net interest income is largely determined by our net interest spread, which is the difference between the average yield earned on interest-earning assets and the average rate paid on interest-bearing liabilities, and the relative amounts of interest-earning assets and interest-bearing liabilities. The Company’s tax-equivalent net interest spread was 4.40% and 4.62% for the three months ended March 31, 2015 and March 31, 2014, respectively. The Company’s tax-equivalent net interest margin, which is net interest income as a percentage of average interest-earning assets, was 4.51% and 4.72% for the three months ended March 31, 2015 and March 31, 2014, respectively. The decrease in the net interest spread and net interest margin related primarily to lower yields on loans and investment securities.

Net interest income totaled $12.5 million for the three months ended March 31, 2015, an increase of $681,000, or 5.8%, compared to the three months ended March 31, 2014. Interest income increased $738,000, or 5.9%, in the first quarter of 2015 compared to the first quarter of 2014. The increase in interest income was primarily due to increased average loan volume. Interest expense increased $57,000, or 7.6%, for the first quarter of 2015 compared to the first quarter of 2014. The increase in the first quarter of 2015 compared to the first quarter of 2014 was primarily due to increases in average volume and in the cost of funds of interest bearing liabilities.

The following table sets forth, for the periods indicated, information regarding (i) the total dollar amount of interest income of the Company from interest-earning assets and the resultant average yields; (ii) the total dollar amount of interest expense on interest-bearing liabilities and the resultant average rate; (iii) net interest income; (iv) net interest spread; and (v) net interest margin. Information is based on average monthly balances during the indicated periods. Taxable equivalent (“TE”) yields are calculated using a marginal tax rate of 35%.


	Three Months Ended March 31,
	2015							2014
*(dollars in thousands)*	Average Balance		Interest		Average Yield/ Rate ⁽¹⁾			Average Balance		Interest		Average Yield/ Rate⁽¹⁾
Interest-earning assets:
Loans receivable⁽¹⁾	$	919,109	$	12,361		5.40	%	$	793,509	$	11,484		5.81	%
Investment securities (TE)		184,331		910		2.18			190,016		1,051		2.47
Other interest-earning assets		15,044		34		0.91			31,166		31		0.41

Total interest-earning assets (TE)		1,118,484		13,305		4.81			1,014,691		12,566		5.02

Noninterest-earning assets		107,736							103,670

Total assets	$	1,226,220						$	1,118,361


Interest-bearing liabilities:
Deposits:
Savings, checking and money market	$	523,535	$	291		0.23	%	$	423,213	$	237		0.23	%
Certificates of deposit		219,066		394		0.73			219,226		385		0.71

Total interest-bearing deposits		742,601		685		0.37			642,439		622		0.39
Securities sold under repurchase agreement		20,295		19		0.37			14,031		17		0.48
FHLB advances		35,441		109		1.23			109,625		116		0.42

Total interest-bearing liabilities		798,337		813		0.41			766,095		755		0.40

Noninterest-bearing liabilities		271,822							210,939

Total liabilities		1,070,159							977,034
Shareholders’ equity		156,061							141,327

Total liabilities and shareholders’ equity	$	1,226,220						$	1,118,361

Net interest-earning assets	$	320,147						$	248,596

Net interest spread (TE)			$	12,492		4.40	%			$	11,811		4.62	%

Net interest margin (TE)						4.51	%						4.72	%

⁽¹⁾	Nonperforming loans are included in the respective average loan balances, net of deferred fees, discounts and loans in process. Acquired loans were recorded at fair value upon acquisition and accrete interest income over the remaining lives of the respective loans.

(The following table displays the dollar amount of changes in interest income and interest expense for major components of interest-earning assets and interest-bearing liabilities. The table distinguishes between (i) changes attributable to volume (changes in average volume between periods times prior year rate), (ii) changes attributable to rate (changes in average rate between periods times prior year volume) and (iii) total increase (decrease).


	For the Three Months Ended
	March 31,
	2015 Compared to 2014
	Change Attributable To
*(dollars in thousands)*	Rate			Volume			Total Increase (Decrease)
Interest income:
Loans receivable	$	(670	)	$	1,547		$	877
Investment securities (TE)		(115	)		(26	)		(141	)
Other interest-earning assets		29			(26	)		3

Total interest income		(756	)		1,495			739


Interest expense:
Savings, checking and money market accounts		—			54			54
Certificates of deposit		11			(2	)		9
Securities sold under repurchase agreement		(4	)		6			2
FHLB advances		(36	)		29			(7	)

Total interest expense		(29	)		87			58

Increase (decrease) in net interest income	$	(727	)	$	1,408		$	681

Provision for Loan Losses – For the quarter ended March 31, 2015, the Company recorded a provision for loan losses of $538,000, $393,000, or 271.3% higher than the $145,000 recorded for the same period in 2014. As of March 31, 2015, the Company’s ratio of allowance for loan losses to total loans was 0.90%, compared to 0.85% and 0.81% at December 31, 2014 and March 31, 2014, respectively. Excluding acquired loans, the ratio of the allowance for loan losses to total loans was 1.07% at March 31, 2015, compared to 1.04% at December 31, 2014 and 1.10% at March 31, 2014, respectively.

Noninterest Income – The Company’s noninterest income was $2.1 million for the three months ended March 31, 2015, $423,000, or 25.5%, higher than the $1.7 million earned for the same period in 2014. The increase in noninterest income in the first quarter of 2015 compared to the first quarter of 2014 resulted primarily from increases in gain on sale of loans (up $211,000), bank card fees (up $110,000) and service fees and charges (up $96,000).

Noninterest Expense – The Company’s noninterest expense for the first quarter of 2015 decreased $1.5 million, or 13.7%, compared to the first quarter of 2014. Noninterest expense for the first three months of 2014 included $2.2 million of merger-related expenses associated with the acquisition of Britton & Koontz. Excluding merger-related expenses, noninterest expense for the first quarter of 2015 totaled $9.7 million, an increase of $417,000, or 4.5%, compared to the first quarter of 2014. The increase in noninterest expense resulted primarily due to the addition of Britton & Koontz branches and employees.

Income Taxes – For the quarters ended March 31, 2015 and March 31, 2014, the Company incurred income tax expense of $1.5 million and $631,000, respectively. The Company’s effective tax rate was 34.0% and 30.6% during the first quarters of 2015 and 2014, respectively. Differences between the effective tax rate and the statutory tax rate primarily relate to variances in items that are non-taxable or non-deductible (e.g., state tax, tax-exempt income, etc.).

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Quantitative and qualitative disclosures about market risk are presented in the Company’s Annual Report on Form 10-K filed with the SEC for the year ended December 31, 2014, under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Asset/ Liability Management and Market Risk”. Additional information at March 31, 2015 is included herein under Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Asset/Liability Management”.

Item 4. Controls and Procedures.

Our management evaluated, with the participation of our Chief Executive Officer and Chief Financial Officer, the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) as of the end of the period covered by this report. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and regulations and are operating in an effective manner.

No change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15(d)-15(f) under the Securities Exchange Act of 1934) occurred during the first quarter of 2015 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings.

Not applicable.

Item 1A. Risk Factors.

There have been no material changes from the risk factors previously disclosed in the Company’s Annual Report on Form 10-K for December 31, 2014 filed with the Securities and Exchange Commission.

Item 2. Unregistered Sales of Equity Securities and the Use of Proceeds.

The Company’s purchases of its common stock made during the quarter consisted of stock repurchases under the Company’s approved plan and are set forth in the following table.


Period	Total Number of Shares Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Maximum Number of Shares that May Yet be Purchased Under the Plan or Programs⁽¹⁾
January 1 - January 31, 2015		15,700	$	22.67		15,700		125,801
February 1 – February 28, 2015		30,780		21.53		30,780		95,021
March 1 – March 31, 2015		36,713		21.28		9,771		85,250

Total		83,193	$	21.64		56,251		85,250

⁽¹⁾	On June 7, 2013, the Company announced the commencement of a new stock repurchase program. Under the plan, the Company can repurchase up to 370,000 shares, or approximately 5% of its common stock outstanding, through open market or privately negotiated transactions.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

None.

Item 5. Other Information.

None.

Item 6. Exhibits and Financial Statement Schedules.


No.		Description

31.1		Rule 13(a)-14(a) Certification of the Chief Executive Officer

31.2		Rule 13(a)-14(a) Certification of the Chief Financial Officer

32.0		Section 1350 Certification

101.INS		XBRL Instance Document

101.SCH		XBRL Taxonomy Extension Schema Document

101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document

101.LAB		XBRL Taxonomy Extension Label Linkbase Document

101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

101.DEF		XBRL Taxonomy Extension Definitions Linkbase Document

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


		HOME BANCORP, INC.

May 11, 2015	By:	/s/ John W. Bordelon
		John W. Bordelon
		President, Chief Executive Officer and Director

May 11, 2015	By:	/s/ Joseph B. Zanco
		Joseph B. Zanco
		Executive Vice President and Chief Financial Officer

Large accelerated filer

Accelerated filer

Non-accelerated filer

¨ (Do not check if a smaller reporting company)

Smaller reporting company