XML 21 R11.htm IDEA: XBRL DOCUMENT

Securities

9 Months Ended

Sep. 30, 2025

Note 3 – Securities

The Company's available-for-sale securities are carried at fair value. For available-for-sale securities in an unrealized loss position, management will first evaluate whether there is intent to sell, or if it is more likely than not that the Company will be required to sell a security prior to anticipated recovery of its amortized cost basis. If either of these criteria are met, the Company will record a write-down of the security's amortized cost basis to fair value through income. For those available-for-sale securities which do not meet the intent or requirement to sell criteria, management will evaluate whether the decline in fair value is a result of credit-related matters or other factors. In performing this assessment, management considers the creditworthiness of the issuer including whether the security is guaranteed by the U.S. Federal Government or other government agency, the extent to which fair value is less than amortized cost, and changes in credit rating during the period, among other factors.

If this assessment indicates the existence of credit losses, the security will be written down to fair value, as determined by a discounted cash flow analysis, through an allowance for credit losses. To the extent the estimated cash flows do not support the amortized cost, the deficiency is considered to be due to credit loss and is recognized in earnings.

Changes in the allowance for credit losses are recorded as a provision for (or reversal of) credit loss expense. Losses are charged against the allowance when the uncollectibility of a security is confirmed, or when either of the aforementioned criteria surrounding intent or requirement to sell have been met.

Securities have been classified on the consolidated balance sheets according to management’s intent. The following tables summarize the amortized cost, allowance for credit losses, and fair value of securities and their corresponding amounts of unrealized gains and losses at the dates indicated:


		Amortized			Unrealized			Unrealized			Allowance for
		Cost			Gain			Loss			Credit Losses			Fair Value

September 30, 2025		(in thousands)
Available-for-Sale Debt Securities:
U.S. Treasury securities		$	68,838		$	338		$	(153)		$	—		$	69,023
U.S. Government agencies			11,149			52			(1)			—			11,200
Agency mortgage-backed securities			45,043			124			(1,320)			—			43,847
Agency collateralized mortgage obligations			10,833			224			(107)			—			10,950
Corporate bonds			86,465			272			(4,093)			—			82,644
Municipal obligations			6,595			—			(107)			—			6,488
SBA securities			6,977			—			(106)			—			6,871
Total		$	235,900		$	1,010		$	(5,887)		$	—		$	231,023


		Amortized			Unrealized			Unrealized			Allowance for
		Cost			Gain			Loss			Credit Losses			Fair Value

December 31, 2024		(in thousands)
Available-for-Sale Debt Securities:
U.S. Treasury securities		$	69,469		$	104		$	(489)		$	—		$	69,084
U.S. Government agencies			9,005			9			(7)			—			9,007
Agency mortgage-backed securities			42,083			—			(2,899)			—			39,184
Agency collateralized mortgage obligations			10,993			147			(307)			—			10,833
Corporate bonds			90,219			163			(6,337)			—			84,045
Municipal obligations			10,092			—			(286)			—			9,806
SBA securities			6,298			2			(54)			—			6,246
Total		$	238,159		$	425		$	(10,379)		$	—		$	228,205

The Company did not record a provision for estimated credit losses on any available-for-sale securities for the three and nine months ended September 30, 2025 and 2024. Excluded from the table above is accrued interest on available-for-sale securities of $1.7 million and $1.6 million at September 30, 2025 and December 31, 2024, respectively, which is included within accrued interest receivable on the consolidated balance sheets. Additionally, the Company did not record any write-offs of accrued interest income on available-for-sale securities for the three and nine months ended September 30, 2025 and 2024. No securities held by the Company were delinquent on contractual payments at September 30, 2025 or December 31, 2024, nor were any securities placed on non-accrual status for the three and nine months ended September 30, 2025 and 2024.

The following is a summary of actual maturities of certain available-for-sale securities as of September 30, 2025. The amortized cost and fair values are based on the contractual maturity dates. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without penalty. Agency mortgage-backed securities and collateralized mortgage obligations are presented as separate lines as paydowns are expected to occur before contractual maturity dates.


		Available-for-Sale
		Amortized Cost			Fair Value

		(in thousands)

Within one year		$	44,634		$	44,293
Over one year to five years			81,471			81,245
Over five years to ten years			49,235			46,025
Over ten years			4,684			4,663
			180,024			176,226
Agency mortgage-backed securities			45,043			43,847
Agency collateralized mortgage obligations			10,833			10,950
		$	235,900		$	231,023

When securities are sold, the adjusted cost of the specific security sold is used to compute the gain or loss on the sale. There were no sales of available-for-sale securities during the three and nine months ended September 30, 2025. During the three and nine months ended September 30, 2024, the Company sold $29.3 million of AFS securities and recognized gross realized losses of $1.9 million and gross realized gains of $30,000.

There were no available-for-sale securities pledged to secure borrowings as of September 30, 2025 and December 31, 2024.

The following tables present fair value and gross unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, as of the dates stated.


				Less than 12 Months						12 Months or More						Total

				(Dollars in thousands)
				Gross						Gross						Gross
				Unrealized			Fair			Unrealized			Fair			Unrealized			Fair
September 30, 2025		Number of Securities		Losses			Value			Losses			Value			Losses			Value
U. S. Treasuries		7		$	(5)		$	6,417		$	(148)		$	6,848		$	(153)		$	13,265
U.S. Government Agencies		2			(1)			2,500			—			—			(1)			2,500
Agency mortgage-backed securities		14			(236)			9,468			(1,084)			24,542			(1,320)			34,010
Agency collateralized mortgage obligations		3			(1)			49			(106)			7,657			(107)			7,706
Corporate bonds		28			(596)			11,375			(3,497)			63,555			(4,093)			74,930
Municipal obligations		6			(6)			1,434			(101)			5,054			(107)			6,488
SBA securities		5			(106)			6,871			—			—			(106)			6,871
Total		65		$	(951)		$	38,114		$	(4,936)		$	107,656		$	(5,887)		$	145,770


				Less than 12 Months						12 Months or More						Total

				(Dollars in thousands)
				Gross						Gross						Gross
				Unrealized			Fair			Unrealized			Fair			Unrealized			Fair
December 31, 2024		Number of Securities		Losses			Value			Losses			Value			Losses			Value
U.S. Treasury securities		18		$	(152)		$	35,388		$	(337)		$	6,646		$	(489)		$	42,034
U.S. Government Agencies		2			(7)			4,999			—			—			(7)			4,999
Agency mortgage-backed securities		17			(1,196)			30,229			(1,703)			8,955			(2,899)			39,184
Agency collateralized mortgage obligations		3			(304)			8,265			(3)			113			(307)			8,378
Corporate bonds		29			(1,250)			8,748			(5,087)			69,134			(6,337)			77,882
Municipal obligations		6			—			—			(286)			7,306			(286)			7,306
SBA securities		3			(54)			4,722			—			—			(54)			4,722
Total		78		$	(2,963)		$	92,351		$	(7,416)		$	92,154		$	(10,379)		$	184,505

Management evaluates securities for expected credit losses at least on a quarterly basis, and more frequently when economic or market concerns warrant such evaluation.

Included in corporate bonds are investments in senior and subordinated debt of banks and bank holding companies, some of which do not have investment ratings.

At September 30, 2025, available-for-sale debt securities had unrealized losses with aggregate depreciation of 3.9% from the Company’s amortized cost basis. These unrealized losses relate to changes in market interest rates since acquiring the securities. As management has the intent and ability to hold available-for-sale debt securities until maturity or cost recovery, no allowance for credit losses on securities is deemed necessary as of September 30, 2025 and December 31, 2024.