XML 24 R11.htm IDEA: XBRL DOCUMENT

Note 3 - Investments

12 Months Ended

Dec. 31, 2023

NOTE 3 – INVESTMENTS

The following tables present the amortized costs, unrealized gains, unrealized losses, and estimated fair values of securities available-for-sale and held-to-maturity, and ACL on securities held-to-maturity, at the dates indicated:

	December 31, 2023
								Estimated
	Amortized		Unrealized		Unrealized			Fair
SECURITIES AVAILABLE-FOR-SALE	Cost		Gains		Losses			Values		ACL
U.S. agency securities	$	21,151	$	46	$	(3,179	)	$	18,018	$	—
Corporate securities		13,000		613		(741	)		12,872		—
Municipal bonds		138,803		42		(19,398	)		119,447		—
Mortgage-backed securities		112,855		238		(11,845	)		101,248		—
U.S. Small Business Administration securities		42,886		—		(1,538	)		41,348		—
Total securities available-for-sale		328,695		939		(36,701	)		292,933		—

SECURITIES HELD-TO-MATURITY
Corporate securities		8,500		—		(834	)		7,666		45
Total securities held-to-maturity		8,500		—		(834	)		7,666		45

Total securities	$	337,195	$	939	$	(37,535	)	$	300,599	$	45

	December 31, 2022
								Estimated
	Amortized		Unrealized		Unrealized			Fair
SECURITIES AVAILABLE-FOR-SALE	Cost		Gains		Losses			Values		ACL
U.S. agency securities	$	21,153	$	—	$	(3,865	)	$	17,288	$	—
Corporate securities		9,497		27		(979	)		8,545		—
Municipal bonds		144,200		21		(23,619	)		120,602		—
Mortgage-backed securities		82,424		—		(12,458	)		69,966		—
U.S. Small Business Administration securities		14,519		—		(1,668	)		12,851		—
Total securities available-for-sale		271,793		48		(42,589	)		229,252		—

SECURITIES HELD-TO-MATURITY
Corporate securities		8,500		—		(571	)		7,929		31
Total securities held-to-maturity		8,500		—		(571	)		7,929		31

Total securities	$	280,293	$	48	$	(43,160	)	$	237,181	$	31

The following table presents the activity in the ACL on securities held-to-maturity by major security type for the years indicated:

SECURITIES HELD-TO-MATURITY	For the Year Ended
Corporate Securities	December 31, 2023		December 31, 2022
Beginning ACL balance	$	31	$	—
Impact of adopting ASU 2016-13		—		72
Provision for (recapture of) credit losses		14		(41	)
Securities charged-off		—		—
Recoveries		—		—
Total ending ACL balance	$	45	$	31

Management measures expected credit losses on held-to-maturity debt securities on an individual basis. The estimate of expected credit losses considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts. Accrued interest receivable on held-to-maturity debt securities totaled $116,000 as of December 31, 2023 and 2022, and was $1.5 million and $1.2 million on available-for-sale debt securities as of December 31, 2023 and 2022, respectively. Accrued interest receivable on securities is reported in “Accrued interest receivable” on the Consolidated Balance Sheets and is excluded from the calculation of the ACL.

The Bank monitors the credit quality of debt securities held-to-maturity quarterly using credit rating, material event notices, and changes in market value. The following table summarizes the amortized cost of debt securities held-to-maturity at the dates indicated, aggregated by credit quality indicator:

	December 31,
Corporate securities	2023		2022
BBB/BBB-	$	7,000	$	8,500
BB+		1,500		—
Total	$	8,500	$	8,500

At December 31, 2023, there were no debt securities held-to-maturity that were classified as either nonaccrual or 90 days or more past due and still accruing interest.

The following table presents, as of December 31, 2023, investment securities which were pledged to secure borrowings, public deposits or other obligations as permitted or required by law:

	December 31, 2023
Purpose or beneficiary	Carrying Value		Amortized Cost		Fair Value
State and local government public deposits	$	39,704	$	45,689	$	39,704
FRB - Bank Term Funding Program facility ("BTFP")		77,043		90,195		77,043
Total pledged securities	$	116,747	$	135,884	$	116,747

Investment securities that were in an unrealized loss position at the dates indicated are presented in the following tables, based on the length of time individual securities have been in an unrealized loss position.

	December 31, 2023
	Less than 12 Months					12 Months or Longer					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
SECURITIES AVAILABLE-FOR-SALE	Value		Losses			Value		Losses			Value		Losses
U.S. agency securities	$	—	$	—		$	15,972	$	(3,179	)	$	15,972	$	(3,179	)
Corporate securities		959		(41	)		4,300		(700	)		5,259		(741	)
Municipal bonds		3,922		(23	)		113,577		(19,375	)		117,499		(19,398	)
Mortgage-backed securities		20,662		(113	)		67,376		(11,732	)		88,038		(11,845	)
U.S. Small Business Administration securities		33,211		(460	)		8,137		(1,078	)		41,348		(1,538	)
Total securities available-for-sale	$	58,754	$	(637	)	$	209,362	$	(36,064	)	$	268,116	$	(36,701	)

SECURITIES HELD-TO-MATURITY
Corporate securities		—		—			7,666		(834	)		7,666		(834	)
Total securities held-to-maturity		—		—			7,666		(834	)		7,666		(834	)

Total	$	58,754	$	(637	)	$	217,028	$	(36,898	)	$	275,782	$	(37,535	)

	December 31, 2022
	Less than 12 Months					12 Months or Longer					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
SECURITIES AVAILABLE-FOR-SALE	Value		Losses			Value		Losses			Value		Losses
U.S. agency securities	$	3,823	$	(118	)	$	13,465	$	(3,747	)	$	17,288	$	(3,865	)
Corporate securities		2,494		(4	)		4,026		(975	)		6,520		(979	)
Municipal bonds		44,261		(5,794	)		73,990		(17,825	)		118,251		(23,619	)
Mortgage-backed securities		29,791		(3,188	)		40,175		(9,270	)		69,966		(12,458	)
U.S. Small Business Administration securities		10,807		(1,162	)		2,044		(506	)		12,851		(1,668	)
Total securities available-for-sale	$	91,176	$	(10,266	)	$	133,700	$	(32,323	)	$	224,876	$	(42,589	)

SECURITIES HELD-TO-MATURITY
Corporate securities		7,929		(571	)		—		—			7,929		(571	)
Total securities held-to-maturity		7,929		(571	)		—		—			7,929		(571	)

Total	$	99,105	$	(10,837	)	$	133,700	$	(32,323	)	$	232,805	$	(43,160	)

There were no held-to-maturity debt securities in an unrealized loss position of less than one year and seven in an unrealized loss position of more than one year at December 31, 2023.

There were 30 available-for-sale securities in an unrealized loss position of less than one year and 180 available-for-sale securities in an unrealized loss position of more than one year at December 31, 2023. The unrealized losses associated with these securities are believed to be caused by changing market conditions that are considered to be temporary and the Company does not intend to sell the securities, and it is not likely to be required to sell these securities prior to maturity. Management monitors the published credit ratings of the issuers of the debt securities for material ratings or outlook changes. Substantially all of the Company’s municipal bond portfolio is comprised of obligations of states and political subdivisions located within the Company’s geographic footprint that are monitored through quarterly or annual financial review utilizing published credit ratings. All the municipal bond securities are investment grade.

All of the available-for-sale mortgage-backed securities and U.S. Small Business Administration securities in an unrealized loss position are issued or guaranteed by government-sponsored enterprises, and the available-for-sale corporate securities are all investment grade and monitored for rating or outlook changes. Based on the Company’s evaluation of these securities, no credit impairment was recorded for the years ended December 31, 2023, 2022, and 2021.

The contractual maturities of securities available-for-sale and held-to-maturity at the dates indicated are listed below. Expected maturities of mortgage-backed securities may differ from contractual maturities because borrowers may have the right to call or prepay the obligations; therefore, these securities are classified separately with no specific maturity date.

	December 31,
	2023				2022
SECURITIES AVAILABLE-FOR-SALE	Amortized		Fair		Amortized		Fair
U.S. agency securities	Cost		Value		Cost		Value
Due within one year	$	922	$	914	$	—	$	—
Due after one year through five years		3,947		3,544		4,874		4,321
Due after five years through ten years		11,972		10,139		6,989		5,963
Due after ten years		4,310		3,421		9,290		7,004
Subtotal		21,151		18,018		21,153		17,288
Corporate securities
Due within one year		1,000		1,004		1,000		997
Due after one year through five years		6,000		6,609		2,497		2,519
Due after five years through ten years		4,000		3,839		4,000		3,763
Due after ten years		2,000		1,420		2,000		1,266
Subtotal		13,000		12,872		9,497		8,545
Municipal bonds
Due within one year		1,013		1,003		2,660		2,644
Due after one year through five years		757		751		1,038		1,012
Due after five years through ten years		7,603		7,101		6,341		5,771
Due after ten years		129,430		110,592		134,161		111,175
Subtotal		138,803		119,447		144,200		120,602
Mortgage-backed securities
Federal National Mortgage Association (“FNMA”)		76,369		66,275		68,421		57,358
Federal Home Loan Mortgage Corporation (“FHLMC”)		32,311		31,376		9,290		8,424
Government National Mortgage Association (“GNMA”)		4,175		3,597		4,713		4,184
Subtotal		112,855		101,248		82,424		69,966
U.S. Small Business Administration securities
Due within one year		198		196		—		—
Due after one year through five years		1,860		1,824		2,553		2,407
Due after five years through ten years		21,420		20,929		4,461		3,996
Due after ten years		19,408		18,399		7,505		6,448
Subtotal		42,886		41,348		14,519		12,851
Total securities available-for-sale		328,695		292,933		271,793		229,252

SECURITIES HELD-TO-MATURITY
Corporate securities
Due after five years through ten years		8,500		7,666		8,500		7,929
Total securities held-to-maturity		8,500		7,666		8,500		7,929
Total securities	$	337,195	$	300,599	$	280,293	$	237,181

There were no sales proceeds, or gains or losses from the sale of securities available-for-sale for the years ended December 31, 2023, 2022, and 2021.