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SECURITIES | 12 Months Ended
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Dec. 31, 2024
Investments, Debt and Equity Securities [Abstract] |
SECURITIES | SECURITIES Amortized cost and estimated fair value of securities available for sale as of December 31, 2024 and 2023 are as follows (in thousands):
| December 31, 2024
| Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Allowance for Credit Losses |  | Estimated Fair Value
U.S. treasury notes and bonds | $ | 59,880 |  |  | $ | — |  |  | $ | 2,974 |  |  | $ | — |  |  | $ | 56,906 |
Mortgage-backed securities, residential | 441,191 |  |  | 14 |  |  | 75,271 |  |  | — |  |  | 365,934 |
Obligations of states and political subdivisions | 37,059 |  |  | — |  |  | 1,554 |  |  | — |  |  | 35,505 |
Corporate bonds and notes | 25,750 |  |  | — |  |  | 3,734 |  |  | — |  |  | 22,016 |
SBA loan pools | 53,391 |  |  | 35 |  |  | 2,345 |  |  | — |  |  | 51,081 |
Total | $ | 617,271 |  |  | $ | 49 |  |  | $ | 85,878 |  |  | $ | — |  |  | $ | 531,442 |
|  | December 31, 2023
|  | Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Allowance for Credit Losses |  | Estimated Fair Value
U.S. treasury notes and bonds |  | $ | 59,812 |  |  | $ | — |  |  | $ | 4,480 |  |  | $ | — |  |  | $ | 55,332 |
Mortgage-backed securities, residential |  | 476,240 |  |  | 6 |  |  | 72,422 |  |  | — |  |  | 403,824 |
Obligations of states and political subdivisions |  | 39,503 |  |  | — |  |  | 817 |  |  | — |  |  | 38,686 |
Corporate bonds and notes |  | 25,750 |  |  | — |  |  | 5,081 |  |  | — |  |  | 20,669 |
SBA loan pools |  | 67,787 |  |  | 75 |  |  | 2,380 |  |  | — |  |  | 65,482 |
Total |  | $ | 669,092 |  |  | $ | 81 |  |  | $ | 85,180 |  |  | $ | — |  |  | $ | 583,993 |
There were no proceeds from sales and calls of securities resulting in gains or losses during the year ended December 31, 2024. Proceeds from the sale of available for sale securities for the year ended December 31, 2023 were $1.2 million, and a gross loss of $14 thousand was realized on these sales. The sales were executed by Chemung Risk Management, Inc., which served as a wholly owned captive insurance company based in the State of Nevada, until dissolution by the Corporation effective December 6, 2023. The tax benefit related to these net realized losses was $4 thousand for the year ended December 31, 2023. The amortized cost and estimated fair value of debt securities available for sale are shown below by contractual maturity. Expected maturities may differ from contractual maturities if borrowers have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately (in thousands):
|  | December 31, 2024
|  | Amortized Cost |  | Estimated Fair Value
Within one year |  | $ | 4,633 |  |  | $ | 4,522 |
After one, but within five years |  | 73,487 |  |  | 69,676 |
After five, but within ten years |  | 43,336 |  |  | 39,075 |
After ten years |  | 1,233 |  |  | 1,154 |
Mortgage-backed securities, residential |  | 441,191 |  |  | 365,934 |
SBA loan pools |  | 53,391 |  |  | 51,081 |
Total |  | $ | 617,271 |  |  | $ | 531,442 |
Amortized cost and estimated fair value of securities held to maturity as of December 31, 2024 and 2023 are as follows (in thousands):
|  | December 31, 2024
|  | Amortized Cost |  | Gross Unrecognized Gains |  | Gross Unrecognized Losses |  | Allowance for Credit Losses |  | Estimated Fair Value
Obligations of states and political subdivisions |  | $ | 808 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 808 |
|  | December 31, 2023
|  | Amortized Cost |  | Gross Unrecognized Gains |  | Gross Unrecognized Losses |  | Allowance for Credit Losses |  | Estimated Fair Value
Obligations of states and political subdivisions |  | $ | 785 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 785 |
There were no proceeds from sales of securities held to maturity during the year ended December 31, 2024. Proceeds from the sale of held to maturity securities for the year ended December 31, 2023 were $1.0 million, and a gross loss of $25 thousand was realized on these sales. The sales were executed by Chemung Risk Management, Inc., which served as a wholly owned captive insurance company based in the State of Nevada, until dissolution by the Corporation effective December 6, 2023. The contractual maturity of securities held to maturity was as follows as of December 31, 2024 (in thousands):
|  | December 31, 2024
|  | Amortized Cost |  | Fair Value
Within one year |  | $ | 200 |  |  | $ | 200 |
After one, but within five years |  | 48 |  |  | 48 |
After five, but within ten years |  | 560 |  |  | 560 |
After ten years |  | — |  |  | — |
Total |  | $ | 808 |  |  | $ | 808 |
The following tables summarize the investment securities available for sale with unrealized losses, for which an allowance for credit losses has not been recorded as of December 31, 2024, and December 31, 2023 aggregated by major security type and length of time in a continuous unrealized loss position (in thousands):
|  | Less than 12 months |  | 12 months or longer |  | Total
|  | Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses
2024 |
U.S. treasury notes and bonds |  | $ | — |  |  | $ | — |  |  | $ | 56,906 |  |  | $ | 2,974 |  |  | $ | 56,906 |  |  | $ | 2,974 |
Mortgage-backed securities, residential |  | 5,006 |  |  | 111 |  |  | 359,722 |  |  | 75,160 |  |  | 364,728 |  |  | 75,271 |
Obligations of states and political subdivisions |  | 107 |  |  | 3 |  |  | 35,398 |  |  | 1,551 |  |  | 35,505 |  |  | 1,554 |
Corporate bonds and notes |  | 1,921 |  |  | 79 |  |  | 20,095 |  |  | 3,655 |  |  | 22,016 |  |  | 3,734 |
SBA loan pools |  | 564 |  |  | 1 |  |  | 46,018 |  |  | 2,344 |  |  | 46,582 |  |  | 2,345 |
Total |  | $ | 7,598 |  |  | $ | 194 |  |  | $ | 518,139 |  |  | $ | 85,684 |  |  | $ | 525,737 |  |  | $ | 85,878 |
|  | Less than 12 months |  | 12 months or longer |  | Total
|  | Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses
2023 |
U.S. treasury notes and bonds |  | $ | — |  |  | $ | — |  |  | $ | 55,332 |  |  | $ | 4,480 |  |  | $ | 55,332 |  |  | $ | 4,480 |
Mortgage-backed securities, residential |  | — |  |  | — |  |  | 402,986 |  |  | 72,422 |  |  | 402,986 |  |  | 72,422 |
Obligations of states and political subdivisions |  | 17,891 |  |  | 241 |  |  | 20,686 |  |  | 576 |  |  | 38,577 |  |  | 817 |
Corporate bonds and notes |  | 7,492 |  |  | 2,508 |  |  | 13,177 |  |  | 2,573 |  |  | 20,669 |  |  | 5,081 |
SBA loan pools |  | 3,914 |  |  | 13 |  |  | 54,468 |  |  | 2,367 |  |  | 58,382 |  |  | 2,380 |
Total |  | $ | 29,297 |  |  | $ | 2,762 |  |  | $ | 546,649 |  |  | $ | 82,418 |  |  | $ | 575,946 |  |  | $ | 85,180 |
Pledged Securities The fair value of securities pledged to secure public funds on deposit or for other purposes as required by law was $181.5 million as of December 31, 2024 and $255.0 million as of December 31, 2023. Concentrations There are no securities of a single issuer (other than securities of U.S. Government sponsored enterprises) that exceeded 10% of shareholders' equity as of December 31, 2024 or 2023. Assessment of Available for Sale Debt Securities for Credit Risk Management assesses the change in fair value of investment securities on a regular basis. Unrealized losses on debt securities may occur from current market conditions, increases in interest rates since the time of purchase, structural changes in an investment, volatility in financial results of specific issuers, or deterioration in credit quality of issuers. Management assesses both qualitative and quantitative factors to determine whether an allowance for credit losses is required. The following is a discussion of the credit quality characteristics of major portfolio segments carrying material unrealized losses as of December 31, 2024. Obli g ations of U.S. Governmental a g encies and sponsored enterprises: As of December 31, 2024, the majority of the Corporation’s unrealized losses in available for sale investment securities related to mortgage-backed securities, issued by government-sponsored entities and agencies. Declines in fair value were attributable to changes in interest rates and market liquidity, not credit quality. All mortgage-backed securities in the available for sale securities portfolio as of December 31, 2024 were issued by FHLMC, FNMA, or GNMA. The Corporation considers these obligations to carry zero credit loss estimates, and therefore has not recorded an allowance for credit losses as of December 31, 2024. Corporate bonds and notes: The Corporation's corporate bonds and notes portfolio is comprised of subordinated debt issues of community and regional banks. Management considers the credit quality of these investments on an individual basis. Management reviews the collectability of these securities, taking into consideration such factors as the financial condition of issuers, reported regulatory capital ratios of the issuers, and credit ratings when available, among other pertinent factors. All corporate bond debt securities continue to accrue interest and make payments as expected with no defaults or deferrals on the part of the issuers. The decrease in market value was attributable to changes in interest rates. Therefore, the Corporation considers the potential credit risk of the issuers to be immaterial, and has not recorded an allowance for credit losses as of December 31, 2024. Equity Method Investments The Corporation holds a non-qualified deferred compensation plan to allow a select group of management and employees the opportunity to defer all or a portion of their annual compensation, and treats assets held under this plan as equity method investments. The fair value of investments held in relation to the deferred compensation plan was $2.6 million and $2.4 million as of December 31, 2024 and 2023, respectively. The Corporation also held $0.6 million of marketable securities as equity method investments for each of the years ended December 31, 2024 and 2023, respectively.

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