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FAIR VALUE OF FINANCIAL INSTRUMENTS
 9 Months Ended
Sep. 30, 2025
Fair Value Disclosures [Abstract]  
FAIR VALUE OF FINANCIAL INSTRUMENTS FAIR VALUE OF FINANCIAL INSTRUMENTS
Fair value is defined as the exchange price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date reflecting assumptions that a market participant would use when pricing an asset or liability. The hierarchy uses three levels of inputs to measure the fair value of assets and liabilities as follows:
•Level 1: Unadjusted quoted prices for identical assets or liabilities traded in active markets.
•Level 2: Significant other observable inputs other than Level 1, including quoted prices for similar assets and liabilities in active markets, quoted prices in less active markets, or other observable inputs that can be corroborated by observable market data.
•Level 3: Significant unobservable inputs that reflect a company’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.
The Company used the following methods and significant assumptions to estimate the fair value of each type of financial instrument:
Investment securities. The fair value of investment securities available for sale are determined by quoted market prices, if available (Level 1). For investment securities available for sale where quoted prices are not available, fair values are calculated based on market prices of similar securities (Level 2). For investment securities available for sale where quoted prices or market prices of similar securities are not available, fair values are calculated using discounted cash flows or other market indicators (Level 3). Securities classified as Level 3 are not actively traded, and as a result, fair value is determined utilizing third-party valuation services through consensus pricing. There were no transfers between Levels 1, 2 or 3 during the period presented for assets measured at fair value on a recurring basis. The fair value of equity securities is determined using quoted prices or market prices for similar securities (Level 2).
Residential loans held for sale. The fair value of residential loans held for sale is determined using quoted prices for a similar asset, adjusted for specific attributes of that loan (Level 2).
Credit enhancement asset. The fair value of the credit enhancement asset is calculated using the Income Approach Valuation Method (Level 3).
Derivative instruments. The fair value of derivative instruments are determined based on derivative valuation models using observable market data as of the measurement date (Level 2).
Nonperforming loans. Nonaccrual loans are considered nonperforming and are reviewed individually for the amount of impairment, if any. We measure collateral dependent nonperforming loans based on the estimated fair value of such collateral. In cases where the Company has an agreed upon selling price for the collateral, the fair value is set at the selling price (Level 1). The fair value of each loan’s collateral is generally based on estimated market prices from an independently prepared appraisal, which is then adjusted for the cost related to liquidating such collateral (Level 2). When adjustments are made to an appraised value to reflect various factors such as the age of the appraisal or known changes in the market or the collateral, such valuation inputs are considered unobservable (Level 3). The nonperforming loans categorized as Level 3 also include unsecured loans and other secured loans whose fair values are based significantly on unobservable inputs such as the strength of a guarantor, cash flows discounted at the effective loan rate, and management’s judgment.
Commercial loans held for sale. The fair value of commercial loans held for sale may be based upon third party bids to purchase the specific notes, or the estimated fair value of the underlying collateral. The fair value of the collateral is based on estimated market prices from an independently prepared appraisal, which is adjusted to reflect the cost of liquidating such collateral, and various other factors such as the age of the appraisal or known changes in the market or the collateral, such valuation inputs are considered unobservable (Level 3).
Consumer loans held for sale. The fair value of consumer loans held for sale are calculated using discounted cash flows or other market indicators (Level 3).
Other Real Estate Owned. OREO is initially recorded at fair value at the date of foreclosure less estimated costs of disposal, which establishes a new cost basis. After foreclosure, OREO is held for sale and is carried at the lower of cost or fair value less estimated costs of disposal. Fair value for OREO is based on an appraisal performed upon foreclosure. Adjustments are routinely made in the appraisal process by the independent appraisers to adjust for differences between comparable sales and income data available. Property is evaluated regularly to ensure the recorded amount is supported by its fair value less estimated costs to dispose. After the initial foreclosure appraisal, fair value is generally determined by an annual appraisal unless known events warrant adjustments to the recorded value (Level 2). When adjustments are made to an appraised value to reflect various factors such as the age of the appraisal or known changes in the market or the collateral, such valuation inputs are considered unobservable (Level 3).
Appraisals for both collateral-dependent loans and other real estate owned are performed by certified general appraisers (for commercial properties) or certified residential appraisers (for residential properties) whose qualifications and licenses have been reviewed and verified by the Company. Once received, a member of the Company’s asset quality or collections department reviews the assumptions and approaches utilized in the appraisal.
Assets and liabilities measured and recorded at fair value, including financial assets for which the Company has elected the fair value option, on a recurring and nonrecurring basis at September 30, 2025 and December 31, 2024, are summarized below:
September 30, 2025
(dollars in thousands)Carrying
amount		Quoted prices
in active
markets
for identical
assets
(Level 1)		Significant
other
observable
inputs
(Level 2)		Significant unobservable
inputs
(Level 3)
Assets and liabilities measured at fair value on a recurring basis:
Assets
Investment securities available for sale:
U.S. government sponsored entities and U.S. agency securities$15,123 $— $15,123 $— 
Mortgage-backed securities - agency1,048,803 — 1,048,803 — 
Mortgage-backed securities - non-agency93,860 — 93,860 — 
Asset-backed student loans43,258 — 43,258 — 
State and municipal securities73,290 — 73,290 — 
Collateralized loan obligations47,845 — 47,845 — 
Corporate securities56,728 — 56,728 — 
Equity securities4,214 4,214 — — 
Residential loans held for sale7,535 — 7,535 — 
Credit enhancement asset5,765 — — 5,765 
Derivative assets3,910 — 3,910 — 
Total$1,400,331 $4,214 $1,390,352 $5,765 
Liabilities
Derivative liabilities$6,309 $— $6,309 $— 
Total$6,309 $— $6,309 $— 
Assets measured at fair value on a non-recurring basis:
Nonperforming loans$44,368 $— $— $44,368 
Other real estate owned393 — — 393 
December 31, 2024
(dollars in thousands)Carrying
amount		Quoted prices
in active
markets
for identical
assets
(Level 1)		Significant
other
observable
inputs
(Level 2)		Significant unobservable
inputs
(Level 3)
Assets and liabilities measured at fair value on a recurring basis:
Assets
Investment securities available for sale:
U.S. government sponsored entities and U.S. agency securities$20,141 $— $20,141 $— 
Mortgage-backed securities - agency847,056 — 847,056 — 
Mortgage-backed securities - non-agency101,012 — 101,012 — 
Asset-backed student loans49,973 — 49,973 — 
State and municipal securities69,061 — 69,061 — 
Collateralized loan obligations40,450 — 40,450 — 
Corporate securities79,881 — 79,881 — 
Equity securities4,792 4,792 — — 
Loans held for sale8,228 — 8,228 — 
Credit enhancement asset16,804 — — 16,804 
Derivative assets3,837 — 3,837 — 
Total$1,241,235 $4,792 $1,219,639 $16,804 
Liabilities
Derivative liabilities$5,655 $— $5,655 $— 
Total$5,655 $— $5,655 $— 
Assets measured at fair value on a non-recurring basis:
Nonperforming loans$120,222 $— $— $120,222 
Consumer loans held for sale336,719 — — 336,719 
Other real estate owned4,941 — — 4,941 
    The following table presents losses recognized on assets measured on a nonrecurring basis for the three and nine months ended September 30, 2025 and 2024:
Three Months Ended September 30,Nine Months Ended September 30,
(dollars in thousands)2025202420252024
Nonperforming loans$5,821 $355 16,114 14,225 
Other real estate owned— 548 — 1,278 
Total losses on assets measured on a nonrecurring basis$5,821 $903 $16,114 $15,503 
    The following tables present quantitative information about significant unobservable inputs used in fair value measurements of Level 3 assets measured on a nonrecurring basis at September 30, 2025 and December 31, 2024:
(dollars in thousands)Fair valueValuation
technique		Unobservable
input / assumptions
Range (weighted average)(1)
September 30, 2025
Nonperforming loans$44,368 Fair value of collateralDiscount for type of property, age of appraisal, and/or current status
0.00% - 60.05% (2.58%)
Other real estate owned393 Fair value of collateralDiscount for type of property, age of appraisal, and/or current status
39.00% - 72.88% (56.42%)
December 31, 2024
Nonperforming loans$120,222 Fair value of collateralDiscount to reflect current market conditions and ultimate collectability
0.00% - 34.15% (0.67%)
Other real estate owned4,941 Fair value of collateralDiscount for type of property, age of appraisal, and/or current status
0.00% - 43.54% (10.68%.)
Consumer loans held for sale(2)
336,719 Discounted cash flowDiscount rate8.98%
(1)Unobservable inputs were weighted by the relative fair value of the instruments.
(2)There was one pool of loans at December 31, 2024 with write-downs during 2024, so no range or weighted average is reported.
ASC Topic 825, Financial Instruments, requires disclosure of the estimated fair value of certain financial instruments and the methods and significant assumptions used to estimate such fair values. Additionally, certain financial instruments and all nonfinancial instruments are excluded from the applicable disclosure requirements.
The Company has elected the fair value option for newly originated residential loans held for sale. These loans are intended for sale and are hedged with derivative instruments. We have elected the fair value option to mitigate accounting mismatches in cases where hedge accounting is complex and to achieve operational simplification.

The following table presents the difference between the aggregate fair value and the aggregate remaining principal balance for loans for which the fair value option has been elected as of September 30, 2025 and December 31, 2024:
September 30, 2025December 31, 2024
(dollars in thousands)Aggregate
fair value		DifferenceContractual
principal		Aggregate
fair value		DifferenceContractual
principal
Residential loans held for sale$7,535 $369 $7,166 $8,228 $282 $7,946 
The following table presents the amount of gains (losses) from fair value changes included in income before income taxes for financial assets carried at fair value for the three and nine months ended September 30, 2025 and 2024:
Three Months Ended September 30,Nine Months Ended September 30,
(dollars in thousands)2025202420252024
Residential loans held for sale$(56)$133 $80 $150 
    The carrying values and estimated fair value of certain financial instruments not carried at fair value at September 30, 2025 and December 31, 2024 were as follows:
September 30, 2025
(dollars in thousands)Carrying
amount		Fair valueQuoted prices
in active
markets
for identical
assets
(Level 1)		Significant
other
observable
inputs
(Level 2)		Significant
unobservable
inputs
(Level 3)
Assets
Cash and due from banks$165,673 $165,673 $165,673 $— $— 
Federal funds sold474 474 474 — — 
Loans4,766,701 4,688,350 — — 4,688,350 
Accrued interest receivable26,672 26,672 — 26,672 — 
Liabilities
Deposits$5,604,825 $5,567,878 $— $5,567,878 $— 
Short-term borrowings146,766 146,766 — 146,766 — 
FHLB and other borrowings373,000 374,874 — 374,874 — 
Subordinated debt27,014 23,090 — 23,090 — 
Trust preferred debentures51,684 49,781 — 49,781 — 
December 31, 2024
(dollars in thousands)Carrying
amount		Fair valueQuoted prices
in active
markets
for identical
assets
(Level 1)		Significant
other
observable
inputs
(Level 2)		Significant
unobservable
inputs
(Level 3)
Assets
Cash and due from banks$114,055 $114,055 $114,055 $— $— 
Federal funds sold711 711 711 — — 
Loans5,056,370 4,872,824 — — 4,872,824 
Accrued interest receivable25,329 25,329 — 25,329 — 
Liabilities
Deposits$6,197,243 $6,183,807 $— $6,183,807 $— 
Short-term borrowings87,499 87,499 75,000 12,499 — 
FHLB and other borrowings258,000 253,520 — 253,520 — 
Subordinated debt77,749 69,827 — 69,827 — 
Trust preferred debentures51,205 49,056 — 49,056 — 
The methods utilized to measure fair value of financial instruments at September 30, 2025 and December 31, 2024 represent an approximation of exit price; however, an actual exit price may differ.