Securities

9 Months Ended

Sep. 30, 2025

Investments, Debt and Equity Securities [Abstract]

Securities available for sale (“AFS”) consist of the following:


	Amortized Cost		Unrealized
			Gains		Losses		Fair Value
	(In thousands)
September 30, 2025
U.S. agency	$	8,509	$	1	$	439	$	8,071
U.S. agency residential mortgage-backed	85,014		117		6,935		78,196
U.S. agency commercial mortgage-backed	8,362		—		907		7,455
Private label mortgage-backed	44,358		262		2,684		41,936
Other asset backed	32,548		24		443		32,129
Obligations of states and political subdivisions	320,802		—		41,187		279,615
Corporate	56,080		11		1,891		54,200
Trust preferred	989		—		8		981
Total	$	556,662	$	415	$	54,494	$	502,583

December 31, 2024
U.S. agency	$	8,858	$	1	$	700	$	8,159
U.S. agency residential mortgage-backed	80,589		47		9,499		71,137
U.S. agency commercial mortgage-backed	12,821		—		1,180		11,641
Private label mortgage-backed	74,268		263		4,496		70,035
Other asset backed	39,232		18		734		38,516
Obligations of states and political subdivisions	330,874		14		42,097		288,791
Corporate	73,960		—		4,039		69,921
Trust preferred	986		—		4		982
Total	$	621,588	$	343	$	62,749	$	559,182

Securities held to maturity (“HTM”) consist of the following:


	Carrying Value		Transferred Unrealized Loss (1)		ACL		Amortized Cost		Unrealized				Fair Value
									Gains		Losses
	(In thousands)
September 30, 2025
U.S. agency	$	23,119	$	1,280	$	—	$	24,399	$	—	$	3,929	$	20,470
U.S. agency residential mortgage-backed	94,648		7,916		—		102,564		—		19,715		82,849
U.S. agency commercial mortgage-backed	3,926		76		—		4,002		—		261		3,741
Private label mortgage-backed	7,310		106		2		7,418		—		315		7,103
Obligations of states and political subdivisions	150,784		4,089		19		154,892		43		15,366		139,569
Corporate	40,706		260		67		41,033		—		2,523		38,510
Trust preferred	957		39		4		1,000		—		—		1,000
Total	$	321,450	$	13,766	$	92	$	335,308	$	43	$	42,109	$	293,242

December 31, 2024
U.S. agency	$	24,150	$	1,404	$	—	$	25,554	$	—	$	4,987	$	20,567
U.S. agency residential mortgage-backed	100,700		8,669		—		109,369		—		24,631		84,738
U.S. agency commercial mortgage-backed	4,013		107		—		4,120		—		402		3,718
Private label mortgage-backed	7,350		190		1		7,541		—		551		6,990
Obligations of states and political subdivisions	156,305		5,262		17		161,584		28		19,461		142,151
Corporate	45,964		496		111		46,571		—		3,875		42,696
Trust preferred	954		43		3		1,000		—		—		1,000
Total	$	339,436	$	16,171	$	132	$	355,739	$	28	$	53,907	$	301,860

(1)Represents the remaining unrealized loss to be accreted on securities that were transferred from AFS to HTM on April 1, 2022.

Our investments' gross unrealized losses and fair values for securities AFS aggregated by investment type and length of time that individual securities have been at a continuous unrealized loss position follows:


	Less Than Twelve Months				Twelve Months or More				Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(In thousands)
September 30, 2025
U.S. agency	$	1,232	$	7	$	6,710	$	432	$	7,942	$	439
U.S. agency residential mortgage-backed	6,395		11		50,236		6,924		56,631		6,935
U.S. agency commercial mortgage-backed	—		—		7,456		907		7,456		907
Private label mortgage-backed	—		—		40,298		2,684		40,298		2,684
Other asset backed	1,021		4		25,368		439		26,389		443
Obligations of states and political subdivisions	155		10		279,299		41,177		279,454		41,187
Corporate	—		—		52,503		1,891		52,503		1,891
Trust preferred	—		—		982		8		982		8
Total	$	8,803	$	32	$	462,852	$	54,462	$	471,655	$	54,494

December 31, 2024
U.S. agency	$	324	$	1	$	7,565	$	699	$	7,889	$	700
U.S. agency residential mortgage-backed	147		—		61,219		9,499		61,366		9,499
U.S. agency commercial mortgage-backed	—		—		11,641		1,180		11,641		1,180
Private label mortgage-backed	2,551		8		66,411		4,488		68,962		4,496
Other asset backed	3,984		19		27,052		715		31,036		734
Obligations of states and political subdivisions	221		1		288,570		42,096		288,791		42,097
Corporate	1,473		23		68,448		4,016		69,921		4,039
Trust preferred	—		—		982		4		982		4
Total	$	8,700	$	52	$	531,888	$	62,697	$	540,588	$	62,749

Securities AFS in unrealized loss positions are evaluated quarterly for impairment related to credit losses. For securities AFS in an unrealized loss position, we first assess whether we intend to sell, or it is more likely than not that we will be required to sell the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value through income. No securities AFS met these two criteria during the periods presented. For securities AFS that do not meet this criteria, we evaluate whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, we consider the extent to which fair value is less than amortized cost, adverse conditions specifically related to the security and the issuer and the impact of changes in market interest rates on the market value of the security, among other factors. If this assessment indicates that a credit loss exists, we compare the present value of cash flows expected to be collected from the security with the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis for the security, a credit loss exists and an ACL is recorded, limited to the amount that the fair value of the security is less than its amortized cost basis. Any impairment that has not been recorded through an ACL is recognized in other comprehensive income, net of applicable taxes. No ACL for securities AFS was needed at September 30, 2025 and December 31, 2024. Accrued interest receivable on securities AFS totaled $3.1 million and $3.9

million at September 30, 2025 and December 31, 2024, respectively, and is excluded from the estimate of credit losses and is included in accrued income and other assets in the interim Condensed Consolidated Statements of Financial Condition.

U.S. agency, U.S. agency residential mortgage-backed and U.S. agency commercial mortgage-backed securities — at September 30, 2025, we had 29 U.S. agency, 88 U.S. agency residential mortgage-backed and 9 U.S. agency commercial mortgage-backed securities whose fair value is less than amortized cost. These securities are either explicitly or implicitly guaranteed by the U.S. government, are highly rated by major credit rating agencies, and have a long history of no credit losses. The unrealized losses are largely attributed to widening spreads to Treasury bonds and/or an increase in interest rates since acquisition.

Private label mortgage backed, other asset backed and corporate securities — at September 30, 2025, we had 50 private label mortgage backed, 37 other asset backed, and 58 corporate securities whose fair value is less than amortized cost. The unrealized losses are primarily due to credit spread widening and/or an increase in interest rates since acquisition.

Obligations of states and political subdivisions — at September 30, 2025, we had 290 municipal securities whose fair value is less than amortized cost. The unrealized losses are primarily due to an increase in interest rates since acquisition.

Trust preferred securities — at September 30, 2025, we had one trust preferred security whose fair value is less than amortized cost. This trust preferred security is a single issue security issued by a trust subsidiary of a bank holding company. The pricing of trust preferred securities has suffered from credit spread widening. This security is rated by a major rating agency as investment grade.

At September 30, 2025 management does not intend to liquidate any of the securities discussed above and it is more likely than not that we will not be required to sell these securities prior to recovery of these unrealized losses.

We recorded no credit related charges in our interim Condensed Consolidated Statements of Operations related to securities AFS during the three and nine month periods ended September 30, 2025 and 2024, respectively.

The ACL on securities HTM is a contra asset valuation account that is deducted from the carrying amount of securities HTM to present the net amount expected to be collected. Securities HTM are charged off against the ACL when deemed uncollectible. Adjustments to the ACL are reported in our interim Condensed Consolidated Statements of Operations in provision for credit losses. We measure expected credit losses on securities HTM on a collective basis by major security type with each type sharing similar risk characteristics, and consider historical credit loss information. Accrued interest receivable on securities HTM totaled $1.7 million at both September 30, 2025 and December 31, 2024, respectively and is excluded from the estimate of credit losses and is included in accrued income and other assets in the interim Condensed Consolidated Statements of Financial Condition. With regard to U.S. Government-sponsored agency and mortgage-backed securities (residential and commercial), all these securities are issued by a U.S. government-sponsored entity and have an implicit or explicit government guarantee; therefore, no allowance for credit losses has been recorded for these securities. With regard to obligations of states and political subdivisions, private label-mortgage-backed, corporate and trust preferred securities HTM, we consider (1) issuer bond ratings, (2) historical loss rates for given bond ratings, (3) the financial condition of the issuer, and (4) whether issuers continue to make timely principal and interest payments under the contractual terms of the securities. Historical loss rates associated with securities having similar grades as those in our portfolio have been insignificant. During the first quarter of 2023, one corporate security (Signature Bank) defaulted resulting in a full charge-off. Subsequent to this security's charge-off, a portion of its fair value had recovered and was subsequently sold during the first quarter of 2024 for $1.1 million during which period we recorded that amount as a recovery to the ACL. Despite this lone security loss, the long-term historical loss rates associated with securities having similar grades as those in our portfolio have been insignificant. Furthermore, as of September 30, 2025 and December 31, 2024, there were no past due principal and interest payments associated with these securities. At those same dates an allowance for credit losses of $92,000 and $132,000, respectively was recorded on non U.S. agency securities HTM based on applying the long-term historical credit loss rate, as published by credit rating agencies, for similarly rated securities.

On a quarterly basis, we monitor the credit quality of securities HTM through the use of credit ratings. The carrying value of securities HTM aggregated by credit quality follow:


	Private Label Mortgage- Backed		Obligations of States and Political Subdivisions		Corporate		Trust Preferred		Carrying Value Total
	(In thousands)
September 30, 2025
Credit rating:
AAA	$	7,310	$	17,764	$	—	$	—	$	25,074
AA	—		117,374		—		—		117,374
A	—		1,886		5,003		—		6,889
BBB	—		443		30,751		—		31,194
BB	—		—		1,979		—		1,979
Non-rated	—		13,317		2,973		957		17,247
Total	$	7,310	$	150,784	$	40,706	$	957	$	199,757

December 31, 2024
Credit rating:
AAA	$	7,350	$	34,973	$	—	$	—	$	42,323
AA	—		101,112		—		—		101,112
A	—		3,473		5,005		—		8,478
BBB	—		652		36,045		—		36,697
BB	—		—		1,963		—		1,963
Non-rated	—		16,095		2,951		954		20,000
Total	$	7,350	$	156,305	$	45,964	$	954	$	210,573

An analysis of the allowance for credit losses by security HTM type for the three months ended September 30 follows:


	Private Label Mortgage- Backed		Obligations of States and Political Subdivisions		Corporate		Trust Preferred		Total
	(In thousands)
2025
Balance at beginning of period	$	1	$	17	$	111	$	4	$	133
Additions (deductions)
Provision for credit losses	1		2		(44)		—		(41)
Recoveries credited to the allowance	—		—		—		—		—
Securities HTM charged against the allowance	—		—		—		—		—
Balance at end of period	$	2	$	19	$	67	$	4	$	92

2024
Balance at beginning of period	$	4	$	31	$	116	$	4	$	155
Additions (deductions)
Provision for credit losses	(3)		(14)		(5)		—		(22)
Recoveries credited to the allowance	—		—		—		—		—
Securities HTM charged against the allowance	—		—		—		—		—
Balance at end of period	$	1	$	17	$	111	$	4	$	133

An analysis of the allowance for credit losses by security HTM type for the nine months ended September 30 follows:


	Private Label Mortgage- Backed		Obligations of States and Political Subdivisions		Corporate		Trust Preferred		Total
	(In thousands)
2025
Balance at beginning of period	$	1	$	17	$	111	$	3	$	132
Additions (deductions)
Provision for credit losses	1		2		(44)		1		(40)
Recoveries credited to the allowance	—		—		—		—		—
Securities HTM charged against the allowance	—		—		—		—		—
Balance at end of period	$	2	$	19	$	67	$	4	$	92

2024
Balance at beginning of period	$	4	$	33	$	116	$	4	$	157
Additions (deductions)
Provision for credit losses	(3)		(16)		(1,130)		—		(1,149)
Recoveries credited to the allowance	—		—		1,125		—		1,125
Securities HTM charged against the allowance	—		—		—		—		—
Balance at end of period	$	1	$	17	$	111	$	4	$	133

The amortized cost and fair value of securities AFS and securities HTM at September 30, 2025, by contractual maturity, follow:


	Securities AFS				Securities HTM
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
	(In thousands)
Maturing within one year	$	24,490	$	24,216	$	13,117	$	12,967
Maturing after one year but within five years	127,044		120,736		48,794		46,630
Maturing after five years but within ten years	42,007		38,417		91,368		82,613
Maturing after ten years	192,839		159,498		68,045		57,339
	386,380		342,867		221,324		199,549
U.S. agency residential mortgage-backed	85,014		78,196		102,564		82,849
U.S. agency commercial mortgage-backed	8,362		7,455		4,002		3,741
Private label mortgage-backed	44,358		41,936		7,418		7,103
Other asset backed	32,548		32,129		—		—
Total	$	556,662	$	502,583	$	335,308	$	293,242

The actual maturity may differ from the contractual maturity because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

Gains and losses realized on the sale of securities AFS are determined using the specific identification method and are recognized on a trade-date basis. A summary of proceeds from the sale of securities AFS and gains and losses for the nine month periods ending September 30, follows:


			Realized
	Proceeds		Gains		Losses
	(In thousands)
2025	$	30,581	$	37	$	392
2024	39,431		14		428

During the second quarter of 2024 we acquired certain securities classified as equity securities at fair value consisting of Visa Inc. Class C common stock. These securities were all sold during the second and third quarters of 2024. During both the three and nine months ended September 30, 2024, we recognized gains (losses) on these equity securities of $(0.01) million and $2.7 million, respectively that are included in net gains on equity securities at fair value in the interim Condensed Consolidated Statements of Operations. We had no equity securities at fair value during the same periods in 2025. See note #13.