XML 22 R12.htm IDEA: XBRL DOCUMENT

Investment securities

9 Months Ended

Sep. 30, 2025

Investment securities

Investment securities

5. Investment securities:

The amortized cost and fair value of investment securities aggregated by investment category at September 30, 2025 and December 31, 2024 are summarized below. There was no allowance for credit losses (“ACL”) recorded for available for sale or held to maturity debt securities at September 30, 2025 and December 31, 2024.


		September 30, 2025
					Gross			Gross
		Amortized			Unrealized			Unrealized			Fair
(Dollars in thousands)		Cost			Gains			Losses			Value
Available for sale:
U.S. Treasury securities		$	132,694		$			$	4,187		$	128,507
State and municipals:
Taxable			68,636			25			7,463			61,198
Tax-exempt			92,000			318			8,532			83,786
Residential mortgage-backed securities:
U.S. government agencies			9,962			147			5			10,104
U.S. government-sponsored enterprises			174,749			751			15,804			159,696
Commercial mortgage-backed securities:
U.S. government-sponsored enterprises			1,915						27			1,888
Private collateralized mortgage obligations			44,907			780			262			45,425
Asset backed securities			19,535			46			298			19,283
Corporate debt securities			23,515			829			437			23,907
Negotiable certificates of deposit			720			7						727
Total available for sale		$	568,633		$	2,903		$	37,015		$	534,521
Held to maturity:
Tax-exempt state and municipals		$	10,821		$	4		$	655		$	10,170
Residential mortgage-backed securities:
U.S. government agencies			12,639						2,088			10,551
U.S. government-sponsored enterprises			49,826						7,002			42,824
Total held to maturity		$	73,286		$	4		$	9,745		$	63,545


		December 31, 2024
					Gross			Gross
		Amortized			Unrealized			Unrealized			Fair
(Dollars in thousands)		Cost			Gains			Losses			Value
Available for sale:
U.S. Treasury securities		$	176,302		$			$	8,751		$	167,551
U.S. government-sponsored enterprises
State and municipals:
Taxable			79,341			39			10,481			68,899
Tax-exempt			76,390			7			10,280			66,117
Residential mortgage-backed securities:
U.S. government agencies			1,403			1			28			1,376
U.S. government-sponsored enterprises			145,831			92			19,547			126,376
Commercial mortgage-backed securities:
U.S. government-sponsored enterprises			1,927						71			1,856
Private collateralized mortgage obligations			38,366			358			152			38,572
Asset backed securities			23,586			66			400			23,252
Corporate debt securities			31,442			894			715			31,621
Negotiable certificates of deposit			700			9						709
Total available for sale		$	575,288		$	1,466		$	50,425		$	526,329
Held to maturity:
Tax-exempt state and municipals		$	10,846		$			$	1,103		$	9,743
Residential mortgage-backed securities:
U.S. government agencies			13,847						2,643			11,204
U.S. government-sponsored enterprises			53,491						9,286			44,205
Total held to maturity		$	78,184		$			$	13,032		$	65,152

The Company did not sell any investment securities during the three and nine months ended September 30, 2025. The Company did not sell any investments from its legacy securities portfolio during the three and nine months ended September 30, 2024. Immediately after the consummation of the FNCB merger, the Company sold a significant portion of the available for sale investments acquired from FNCB and used the proceeds of $241.3 million to repay short-term borrowings and build on-balance sheet liquidity; there were no gains or losses on the sale.

The following table summarizes the maturity distribution of the fair value, which is the net carrying amount, of the debt securities classified as available for sale at September 30, 2025. Expected maturities will differ from contractual maturities because borrowers have the right to call or prepay obligations with or without call or prepayment penalties.


		Amortized			Fair
(Dollars in thousands)		Cost			Value
Within one year		$	67,777		$	67,008
After one but within five years			109,367			104,142
After five but within ten years			68,813			62,794
After ten years			71,608			64,181
			317,565			298,125
Mortgage-backed and other amortizing securities			251,068			236,396
Total		$	568,633		$	534,521

The maturity distribution of the amortized cost and fair value, of debt securities classified as held to maturity at September 30, 2025, is summarized as follows:


		Amortized			Fair
(Dollars in thousands)		Cost			Value
After one but within five years		$	3,212		$	2,939
After five but within ten years			7,609			7,231
			10,821			10,170
Mortgage-backed securities			62,465			53,375
Total		$	73,286		$	63,545

Securities with a carrying value of $437.7 million and $441.5 million at September 30, 2025 and December 31, 2024, respectively, were pledged to secure public deposits and certain other deposits as required or permitted by law and pledged to the Discount Window at the Federal Reserve.

Securities and short-term investment activities are conducted with a diverse group of government entities, corporations and state and local municipalities. The counterparty’s creditworthiness and type of collateral is evaluated on a case-by-case basis. At September 30, 2025, there were no significant concentrations of credit risk from any one issuer, with the exception of U.S. government agencies and sponsored enterprises, which exceeded 10.0 percent of stockholders’ equity.

The fair value and gross unrealized losses of investment securities with unrealized losses at September 30, 2025 and December 31, 2024, aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position, are summarized as follows:


		September 30, 2025
		Less than Twelve Months								Twelve Months or Longer								Total
		Total # in a loss					Unrealized			Total # in a loss					Unrealized			Total # in a loss					Unrealized
(Dollars in thousands)		Position			Fair Value		Losses			Position			Fair Value		Losses			Position			Fair Value		Losses
Securities Available for Sale
U.S. Treasury securities				$			$			32		$	128,507		$	4,187		32		$	128,507		$	4,187
State and municipals:
Taxable										64			58,578			7,463		64			58,578			7,463
Tax-exempt		1			255			1		89			63,370			8,531		90			63,625			8,532
Residential mortgage-backed securities:
U.S. government agencies										1			1,369			5		1			1,369			5
U.S. government-sponsored enterprises		14			31,779			155		33			70,758			15,649		47			102,537			15,804
Commercial mortgage-backed securities:
U.S. government-sponsored enterprises										1			1,888			27		1			1,888			27
Private collateralized mortgage obligations		5			10,174			71		10			7,734			191		15			17,908			262
Asset-backed securities		1			2,296			13		2			1,892			285		3			4,188			298
Corporate debt securities										9			8,195			437		9			8,195			437
Total		21		$	44,504		$	240		241		$	342,291		$	36,775		262		$	386,795		$	37,015

Securities Held to Maturity
Tax-exempt state and municipals				$			$			11		$	6,615		$	655		11		$	6,615		$	655
Residential mortgage-backed securities:
U.S. government agencies										4			10,551			2,088		4			10,551			2,088
U.S. government-sponsored enterprises										8			42,824			7,002		8			42,824			7,002
Total				$			$			23		$	59,990		$	9,745		23		$	59,990		$	9,745


		December 31, 2024
		Less than Twelve Months								Twelve Months or Longer								Total
		Total # in a loss						Unrealized		Total # in a loss						Unrealized		Total # in a loss						Unrealized
(Dollars in thousands)		Position			Fair Value			Losses		Position			Fair Value			Losses		Position			Fair Value			Losses
Securities available for sale
U.S. Treasury securities				$			$			38		$	167,551		$	8,751		38		$	167,551		$	8,751
State and municipals:
Taxable		2			1,097			6		64			55,712			10,475		66			56,809			10,481
Tax-exempt		6			1,874			41		91			62,329			10,239		97			64,203			10,280
Residential mortgage-backed securities:
U.S. government agencies		1			1,299			27		1			3			1		2			1,302			28
U.S. government-sponsored enterprises		29			40,886			622		31			68,732			18,925		60			109,618			19,547
Commercial mortgage-backed securities:
U.S. government-sponsored enterprises										1			1,856			71		1			1,856			71
Private collateralized mortgage obligations		15			12,854			152										15			12,854			152
Asset-backed securities		2			2,659			11		1			1,939			389		3			4,598			400
Corporate debt securities		5			6,083			316		6			3,601			399		11			9,684			715
Total		60		$	66,752		$	1,175		233		$	361,723		$	49,250		293		$	428,475		$	50,425


Securities held to maturity
Tax-exempt state and municipals		4		$	2,508		$	66		12		$	7,235		$	1,037		16		$	9,743		$	1,103
Residential mortgage-backed securities:
U.S. government agencies										4			11,204			2,643		4			11,204			2,643
U.S. government-sponsored enterprises										8			44,205			9,286		8			44,205			9,286
Total		4		$	2,508		$	66		24		$	62,644		$	12,966		28		$	65,152		$	13,032

Management considered whether a credit loss existed related to the investments in an unrealized loss position by determining (i) whether the decline in fair value is attributable to adverse conditions specifically related to the financial condition of the security issuer or specific conditions in an industry or geographic area; (ii) whether the credit rating of the issuer of the security has been downgraded; (iii) whether dividend or interest payments have been reduced or have not been made and (iv) an adverse change in the remaining expected cash flows from the security such that the Company will not recover the amortized cost of the security. If the decline is judged to be due to factors related to credit, the credit loss should be recorded as an ACL with an offsetting entry to net income. The portion of the loss related to non-credit factors are recorded in OCI.

Based on management’s assessment of the factors identified above, it is determined the fair value of all the identified investments being less than the amortized costs was primarily caused by changes in market interest rates and spreads and not credit quality of the issuers. All interest payments have been received as scheduled, substantially all debt securities are rated above investment grade and no material downgrades were announced. Because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost basis, which may be maturity, the Company does not consider unrealized losses related to investments to be credit related, thus no allowance for credit losses for these investments was recorded at September 30, 2025 or December 31, 2024.

Equity Securities

Included in equity securities with readily determinable fair values at September 30, 2025, were investments in the common or preferred stock of publicly traded bank holding companies and an investment in a mutual fund comprised of 1-4 family residential mortgage-backed securities collateralized by properties within the Company’s market area. Equity securities with readily determinable fair values are reported at fair value with net unrealized gains and losses recognized in the consolidated statements of income and comprehensive income.

The following table presents unrealized and realized gains and losses recognized in net income on equity securities for the three and nine months ended September 30, 2025, and 2024:


			For the three months ended						For the nine months ended
			September 30,						September 30,
(Dollars in thousands)			2025			2024			2025			2024
Net (losses) gains recognized on equity securities		$	(21)		$	175		$	43		$	155
Less: net gains realized on equity securities sold						54						54
Unrealized (losses) gains on equity securities		$	(21)		$	121		$	43		$	101

Equity Securities without Readily Determinable Fair Values

The Company’s holdings of equity securities without readily determinable fair values primarily includes restricted equity securities of the Federal Home Loan Bank (“FHLB”) of Pittsburgh and Atlantic Community Bankers Bank. Also included in equity securities without readily determinable fair values are an investment in fixed-rate, non-cumulative perpetual preferred stock of a privately held bank holding company, equity interests in two FinTech companies and an equity interest in an insurance company. The Company evaluates equity securities without readily determinable fair values for impairment quarterly, or more frequently should events or circumstances indicate that their respective carrying values may not be recoverable. Based on its evaluations, the Company determined that there was no impairment related to its investments in equity securities without readily determinable fair values at September 30, 2025 and December 31, 2024. Equity securities without readily determinable fair values, which are included in other assets in the Consolidated Balance Sheets were $5.4 million at September 30, 2025 and $5.1 million at December 31, 2024.