therefore , management has reviewed and approved these critical accounting policies and estimates and has discussed these policies with the company 's audit committee . 42 allowance for loan losses the allowance for loan loss is management 's estimate of credit losses inherent in the loan portfolio . the allowance for loan losses is established as losses are estimated to have occurred through a provision for loan losses charged to earnings . loan losses are charged against the allowance when management believes the uncollectibility of a loan balance is confirmed . subsequent recoveries , if any , are credited to the allowance . the allowance for loan losses is evaluated on a regular basis by management and is based upon management 's periodic review of the collectability of the loans in light of historical experience , the nature and volume of the loan portfolio , adverse situations that may affect the borrower 's ability to repay , estimated value of any underlying collateral and prevailing economic conditions . this evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available . we have an established process to determine the adequacy of the allowance for loan losses that assesses the losses inherent in our portfolio . while we attribute portions of the allowance to specific portfolio segments , the entire allowance is available to absorb credit losses inherent in the total loan portfolio . our process involves procedures to appropriately consider the unique risk characteristics of our commercial and consumer loan portfolio segments . for each portfolio segment , impairment is measured individually for each impaired loan . our allowance levels are influenced by loan volume , loan grade or delinquency status , historic loss experience and other economic conditions . the allowance consists of general and specific components . commercial loans are assessed for estimated losses by grading each loan using various risk factors identified through periodic reviews . we apply historic grade-specific loss factors to each loan class . in the development of our statistically derived loan grade loss factors , we observe historical losses over 20 quarters for each loan grade . these loss estimates are adjusted as appropriate based on additional analysis of external loss data or other risks identified from current economic conditions and credit quality trends . for consumer loans , we determine the allowance on a collective basis utilizing historical losses over 20 quarters to represent our best estimate of inherent loss . we pool loans , generally by loan class with similar risk characteristics . included in the general component of the allowance for loan losses for both portfolio segments is a margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating general losses in the portfolio . uncertainties and subjective issues such as changes in the lending policies and procedures , changes in the local/national economy , changes in volume or type of credits , changes in volume/severity or problem loans , quality of loan review and board of director oversight , concentrations of credit , and peer group comparisons are qualitative and environmental factors considered . the specific component relates to loans that are classified as impaired . for loans that are classified as impaired , an allowance is established when the value of the impaired loan is lower than the carrying value of that loan . a loan is considered impaired when , based on current information and events , it is probable that the company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement . factors considered by management in determining impairment include payment status , collateral value , and the probability of collecting scheduled principal and interest payments when due . impairment is measured on a loan by loan basis for commercial and consumer loans by either the present value of expected future cash flows discounted at the loan 's effective interest rate , the loan 's obtainable market price , or the fair value of the collateral if the loan is collateral dependent . the specific component also includes an amount for the estimated impairment on commercial and consumer loans modified in a troubled debt restructuring ( “ tdr ” ) , whether on accrual or nonaccrual status . while management uses available information to recognize losses on loans , future additions to the allowance may be necessary based on changes in local economic conditions . in addition , regulatory agencies , as an integral part of their examination process , periodically review our allowance for loan losses . such agencies may require us to recognize additions to the allowances based on their judgments about information available to them at the time of their examination . fair valuation of financial instruments we use fair value measurements to record fair value adjustments to certain financial instruments and to determine fair value disclosures . additionally , we may be required to record other assets at fair value on a nonrecurring basis . these nonrecurring fair value adjustments typically involve application of lower-of-cost-or-market accounting or write-downs of individual assets . further , we include in the notes to the consolidated financial statements information about the extent to which fair value is used to measure assets and liabilities , the valuation methodologies used , and the related impact to income . additionally , for financial instruments not recorded at fair value , we disclose the estimate of their fair value . 43 fair value is defined as the exchange price that would be received to sell an asset or paid to transfer the liability in an orderly transaction between market participants at the measurement date . accounting standards establish a three-level hierarchy for disclosure of assets and liabilities recorded at fair value . story_separator_special_tag the increase in provision expense of $ 2.3 million during 2019 primarily relates to the $ 266.2 million of loan growth in 2019. during the year ended december 31 , 2019 , our net charge-offs were $ 1.4 million , representing 0.08 % of average loans , and consisted of $ 1.5 million in loans charged-off , partially offset by $ 95,000 of recoveries on loans previously charged-off . in addition , nonperforming assets decreased to 0.30 % of total assets while our level of classified assets declined to 7.9 % at december 31 , 2019. factors such as these are also considered in determining the amount of our loan loss provision necessary to maintain our allowance for loan losses at an adequate level . the continued improvement in these credit quality factors is the primary driver of the reduction in the allowance for loan losses as a percentage of our gross loans . we reported net charge-offs of $ 1.7 million and $ 1.3 million for the years ended december 31 , 2018 and 2017 , respectively , including recoveries of $ 485,000 and $ 306,000 in 2018 and 2017 , respectively . the net charge-offs of $ 1.7 million and $ 1.3 million during 2018 and 2017 , respectively , represented 0.11 % and 0.10 % of the average outstanding loan portfolios for 2018 and 2017 , respectively . noninterest income the following table sets forth information related to our noninterest income . replace_table_token_7_th noninterest income was $ 15.0 million for the year ended december 31 , 2019 , a $ 4.8 million , or 46.9 % , increase compared to noninterest income of $ 10.2 million for the year ended december 31 , 2018. the increase in noninterest income during 2019 , compared to 2018 , resulted primarily from the following : ● mortgage banking income increased $ 4.4 million , or 79.0 % , driven by higher mortgage origination volume during 2019 due in part to the favorable interest rate environment for mortgage loans . ● atm and debit card income increased $ 238,000 , or 16.0 % , driven by higher transaction volume when compared to 2018 . ● gain on sale of investment securities increased $ 720,000 primarily due to the sale of investments during the fourth quarter . see paragraph immediately below . ● loss on extinguishment of debt resulted from the prepayment penalty related to the paydown of fhlb advances . see paragraph immediately below . ● other income increased by $ 797,000 , or 64.2 % , due primarily to the sale of our health savings account ( “ hsa ” ) deposit accounts during the fourth quarter . see paragraph immediately below . during the fourth quarter of 2019 , the company sold its health savings account ( “ hsa ” ) deposit accounts , which totaled $ 6.2 million , to a nationwide hsa servicer and recognized a gain of approximately $ 745,000 from the sale . also during the fourth quarter , the company sold $ 29.5 million of investment securities from its existing investment portfolio , recognizing a gain of approximately $ 720,000 and paid off $ 25.0 million of fhlb advances that resulted in a prepayment penalty of $ 1.5 million . 48 noninterest income was $ 10.2 million for the year ended december 31 , 2018 , a $ 864,000 , or 9.3 % , increase compared to noninterest income of $ 9.3 million for the year ended december 31 , 2017. the increase in noninterest income during 2018 , compared to 2017 resulted primarily from the following : ● mortgage banking income increased $ 392,000 , or 7.6 % , driven by higher origination volume during 2018 due primarily to an increase in mortgage originators across all of our markets . ● atm and debit card income increased $ 318,000 , or 27.1 % , driven by higher transaction volume when compared to 2017 . ● other income increased by $ 212,000 , or 20.6 % , due primarily to an increase in wire fees , which is driven primarily by an increase in transaction volume , as well as increased loan fee income , which includes late fees , appraisal review fees , and line of credit fees . noninterest expenses the following table sets forth information related to our noninterest expenses . replace_table_token_8_th noninterest expenses were $ 44.5 million for the year ended december 31 , 2019 , a $ 4.7 million , or 11.8 % , increase from noninterest expense of $ 39.8 million for 2018. the increase in total noninterest expenses during 2019 , compared to 2018 , resulted primarily from the following : ● compensation and benefits expense increased $ 3.5 million , or 13.6 % , during 2019 relating primarily to an increase in base compensation , partially offset by a decrease in benefits expense . base compensation expense increased by $ 4.1 million driven by the addition of 14 new employees - of which 12 were hired to support our new offices in georgia , north carolina , and south carolina . benefits expense , which includes insurance and 401k expenses , decreased by $ 485,000 primarily due to lower group insurance costs related to lower claims expense in 2019 . ● occupancy expenses increased $ 478,000 , or 9.5 % , driven by increased rent expense primarily due to two new offices in summerville , south carolina and greensboro , north carolina as well as additional depreciation , insurance , property taxes and maintenance expenses related to all of our owned properties . ● outside service and data processing costs increased $ 885,000 , or 26.8 % , primarily due to increased electronic banking and software licensing costs . partially offsetting these increases in noninterest expenses during 2019 was a $ 471,000 decrease in insurance expenses which was driven by a reduction in fdic premiums in the fourth quarter . noninterest expense was $ 39.8 million

liquidity and capital resources liquidity represents the ability of a company to convert assets into cash or cash equivalents without significant loss , and the ability to raise additional funds by increasing liabilities . liquidity management involves monitoring our sources and uses of funds in order to meet our day-to-day cash flow requirements while maximizing profits . liquidity management is made more complicated because different balance sheet components are subject to varying degrees of management control . for example , the timing of maturities of our investment portfolio is fairly predictable and subject to a high degree of control at the time investment decisions are made . however , net deposit inflows and outflows are far less predictable and are not subject to the same degree of control . at december 31 , 2019 and 2018 , our cash and cash equivalents amounted to $ 127.8 million and $ 72.9 million , or 5.6 % and 3.8 % of total assets , respectively . our investment securities at december 31 , 2019 and 2018 amounted to $ 74.6 million and $ 79.0 million , or 3.3 % and 4.2 % of total assets , respectively . investment securities traditionally provide a secondary source of liquidity since they can be converted into cash in a timely manner . our ability to maintain and expand our deposit base and borrowing capabilities serves as our primary source of liquidity . we plan to meet our future cash needs through the liquidation of temporary investments , the generation of deposits , and from additional borrowings . in addition , we will receive cash upon the maturity and sale of loans and the maturity of investment securities . we maintain four federal funds purchased lines of credit with correspondent banks totaling $ 72.0 million for which there were no borrowings against the lines at december 31 , 2019. we are also a member of the fhlb of atlanta , from which applications for borrowings can be made . the fhlb requires that securities , qualifying mortgage loans , and stock of the fhlb owned by the bank be pledged to secure any advances from the fhlb .


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```liquidity and capital resources liquidity represents the ability of a company to convert assets into cash or cash equivalents without significant loss , and the ability to raise additional funds by increasing liabilities . liquidity management involves monitoring our sources and uses of funds in order to meet our day-to-day cash flow requirements while maximizing profits . liquidity management is made more complicated because different balance sheet components are subject to varying degrees of management control . for example , the timing of maturities of our investment portfolio is fairly predictable and subject to a high degree of control at the time investment decisions are made . however , net deposit inflows and outflows are far less predictable and are not subject to the same degree of control . at december 31 , 2019 and 2018 , our cash and cash equivalents amounted to $ 127.8 million and $ 72.9 million , or 5.6 % and 3.8 % of total assets , respectively . our investment securities at december 31 , 2019 and 2018 amounted to $ 74.6 million and $ 79.0 million , or 3.3 % and 4.2 % of total assets , respectively . investment securities traditionally provide a secondary source of liquidity since they can be converted into cash in a timely manner . our ability to maintain and expand our deposit base and borrowing capabilities serves as our primary source of liquidity . we plan to meet our future cash needs through the liquidation of temporary investments , the generation of deposits , and from additional borrowings . in addition , we will receive cash upon the maturity and sale of loans and the maturity of investment securities . we maintain four federal funds purchased lines of credit with correspondent banks totaling $ 72.0 million for which there were no borrowings against the lines at december 31 , 2019. we are also a member of the fhlb of atlanta , from which applications for borrowings can be made . the fhlb requires that securities , qualifying mortgage loans , and stock of the fhlb owned by the bank be pledged to secure any advances from the fhlb .
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 Suspicious Activity Report : therefore , management has reviewed and approved these critical accounting policies and estimates and has discussed these policies with the company 's audit committee . 42 allowance for loan losses the allowance for loan loss is management 's estimate of credit losses inherent in the loan portfolio . the allowance for loan losses is established as losses are estimated to have occurred through a provision for loan losses charged to earnings . loan losses are charged against the allowance when management believes the uncollectibility of a loan balance is confirmed . subsequent recoveries , if any , are credited to the allowance . the allowance for loan losses is evaluated on a regular basis by management and is based upon management 's periodic review of the collectability of the loans in light of historical experience , the nature and volume of the loan portfolio , adverse situations that may affect the borrower 's ability to repay , estimated value of any underlying collateral and prevailing economic conditions . this evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available . we have an established process to determine the adequacy of the allowance for loan losses that assesses the losses inherent in our portfolio . while we attribute portions of the allowance to specific portfolio segments , the entire allowance is available to absorb credit losses inherent in the total loan portfolio . our process involves procedures to appropriately consider the unique risk characteristics of our commercial and consumer loan portfolio segments . for each portfolio segment , impairment is measured individually for each impaired loan . our allowance levels are influenced by loan volume , loan grade or delinquency status , historic loss experience and other economic conditions . the allowance consists of general and specific components . commercial loans are assessed for estimated losses by grading each loan using various risk factors identified through periodic reviews . we apply historic grade-specific loss factors to each loan class . in the development of our statistically derived loan grade loss factors , we observe historical losses over 20 quarters for each loan grade . these loss estimates are adjusted as appropriate based on additional analysis of external loss data or other risks identified from current economic conditions and credit quality trends . for consumer loans , we determine the allowance on a collective basis utilizing historical losses over 20 quarters to represent our best estimate of inherent loss . we pool loans , generally by loan class with similar risk characteristics . included in the general component of the allowance for loan losses for both portfolio segments is a margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating general losses in the portfolio . uncertainties and subjective issues such as changes in the lending policies and procedures , changes in the local/national economy , changes in volume or type of credits , changes in volume/severity or problem loans , quality of loan review and board of director oversight , concentrations of credit , and peer group comparisons are qualitative and environmental factors considered . the specific component relates to loans that are classified as impaired . for loans that are classified as impaired , an allowance is established when the value of the impaired loan is lower than the carrying value of that loan . a loan is considered impaired when , based on current information and events , it is probable that the company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement . factors considered by management in determining impairment include payment status , collateral value , and the probability of collecting scheduled principal and interest payments when due . impairment is measured on a loan by loan basis for commercial and consumer loans by either the present value of expected future cash flows discounted at the loan 's effective interest rate , the loan 's obtainable market price , or the fair value of the collateral if the loan is collateral dependent . the specific component also includes an amount for the estimated impairment on commercial and consumer loans modified in a troubled debt restructuring ( “ tdr ” ) , whether on accrual or nonaccrual status . while management uses available information to recognize losses on loans , future additions to the allowance may be necessary based on changes in local economic conditions . in addition , regulatory agencies , as an integral part of their examination process , periodically review our allowance for loan losses . such agencies may require us to recognize additions to the allowances based on their judgments about information available to them at the time of their examination . fair valuation of financial instruments we use fair value measurements to record fair value adjustments to certain financial instruments and to determine fair value disclosures . additionally , we may be required to record other assets at fair value on a nonrecurring basis . these nonrecurring fair value adjustments typically involve application of lower-of-cost-or-market accounting or write-downs of individual assets . further , we include in the notes to the consolidated financial statements information about the extent to which fair value is used to measure assets and liabilities , the valuation methodologies used , and the related impact to income . additionally , for financial instruments not recorded at fair value , we disclose the estimate of their fair value . 43 fair value is defined as the exchange price that would be received to sell an asset or paid to transfer the liability in an orderly transaction between market participants at the measurement date . accounting standards establish a three-level hierarchy for disclosure of assets and liabilities recorded at fair value . story_separator_special_tag the increase in provision expense of $ 2.3 million during 2019 primarily relates to the $ 266.2 million of loan growth in 2019. during the year ended december 31 , 2019 , our net charge-offs were $ 1.4 million , representing 0.08 % of average loans , and consisted of $ 1.5 million in loans charged-off , partially offset by $ 95,000 of recoveries on loans previously charged-off . in addition , nonperforming assets decreased to 0.30 % of total assets while our level of classified assets declined to 7.9 % at december 31 , 2019. factors such as these are also considered in determining the amount of our loan loss provision necessary to maintain our allowance for loan losses at an adequate level . the continued improvement in these credit quality factors is the primary driver of the reduction in the allowance for loan losses as a percentage of our gross loans . we reported net charge-offs of $ 1.7 million and $ 1.3 million for the years ended december 31 , 2018 and 2017 , respectively , including recoveries of $ 485,000 and $ 306,000 in 2018 and 2017 , respectively . the net charge-offs of $ 1.7 million and $ 1.3 million during 2018 and 2017 , respectively , represented 0.11 % and 0.10 % of the average outstanding loan portfolios for 2018 and 2017 , respectively . noninterest income the following table sets forth information related to our noninterest income . replace_table_token_7_th noninterest income was $ 15.0 million for the year ended december 31 , 2019 , a $ 4.8 million , or 46.9 % , increase compared to noninterest income of $ 10.2 million for the year ended december 31 , 2018. the increase in noninterest income during 2019 , compared to 2018 , resulted primarily from the following : ● mortgage banking income increased $ 4.4 million , or 79.0 % , driven by higher mortgage origination volume during 2019 due in part to the favorable interest rate environment for mortgage loans . ● atm and debit card income increased $ 238,000 , or 16.0 % , driven by higher transaction volume when compared to 2018 . ● gain on sale of investment securities increased $ 720,000 primarily due to the sale of investments during the fourth quarter . see paragraph immediately below . ● loss on extinguishment of debt resulted from the prepayment penalty related to the paydown of fhlb advances . see paragraph immediately below . ● other income increased by $ 797,000 , or 64.2 % , due primarily to the sale of our health savings account ( “ hsa ” ) deposit accounts during the fourth quarter . see paragraph immediately below . during the fourth quarter of 2019 , the company sold its health savings account ( “ hsa ” ) deposit accounts , which totaled $ 6.2 million , to a nationwide hsa servicer and recognized a gain of approximately $ 745,000 from the sale . also during the fourth quarter , the company sold $ 29.5 million of investment securities from its existing investment portfolio , recognizing a gain of approximately $ 720,000 and paid off $ 25.0 million of fhlb advances that resulted in a prepayment penalty of $ 1.5 million . 48 noninterest income was $ 10.2 million for the year ended december 31 , 2018 , a $ 864,000 , or 9.3 % , increase compared to noninterest income of $ 9.3 million for the year ended december 31 , 2017. the increase in noninterest income during 2018 , compared to 2017 resulted primarily from the following : ● mortgage banking income increased $ 392,000 , or 7.6 % , driven by higher origination volume during 2018 due primarily to an increase in mortgage originators across all of our markets . ● atm and debit card income increased $ 318,000 , or 27.1 % , driven by higher transaction volume when compared to 2017 . ● other income increased by $ 212,000 , or 20.6 % , due primarily to an increase in wire fees , which is driven primarily by an increase in transaction volume , as well as increased loan fee income , which includes late fees , appraisal review fees , and line of credit fees . noninterest expenses the following table sets forth information related to our noninterest expenses . replace_table_token_8_th noninterest expenses were $ 44.5 million for the year ended december 31 , 2019 , a $ 4.7 million , or 11.8 % , increase from noninterest expense of $ 39.8 million for 2018. the increase in total noninterest expenses during 2019 , compared to 2018 , resulted primarily from the following : ● compensation and benefits expense increased $ 3.5 million , or 13.6 % , during 2019 relating primarily to an increase in base compensation , partially offset by a decrease in benefits expense . base compensation expense increased by $ 4.1 million driven by the addition of 14 new employees - of which 12 were hired to support our new offices in georgia , north carolina , and south carolina . benefits expense , which includes insurance and 401k expenses , decreased by $ 485,000 primarily due to lower group insurance costs related to lower claims expense in 2019 . ● occupancy expenses increased $ 478,000 , or 9.5 % , driven by increased rent expense primarily due to two new offices in summerville , south carolina and greensboro , north carolina as well as additional depreciation , insurance , property taxes and maintenance expenses related to all of our owned properties . ● outside service and data processing costs increased $ 885,000 , or 26.8 % , primarily due to increased electronic banking and software licensing costs . partially offsetting these increases in noninterest expenses during 2019 was a $ 471,000 decrease in insurance expenses which was driven by a reduction in fdic premiums in the fourth quarter . noninterest expense was $ 39.8 million

