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Securities | 9 Months Ended
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Sep. 30, 2023
Debt Securities, Available-for-Sale [Abstract] |
Securities | NOTE 4. Securities On January 1, 2023, the Company adopted ASC 326, which made changes to accounting for available for sale debt securities whereby credit losses should be presented as an allowance, rather than as a write-down when management does not intend to sell and does not believe that it is more likely than not they will be required to sell a security prior to maturity. In addition, ASC 326 requires financial assets measured at amortized cost to measure an expected credit loss under the CECL methodology that requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. All securities information presented as of September 30, 2023 is in accordance with ASC 326. All securities information presented as of December 31, 2022 or a prior date is presented in accordance with previously applicable GAAP. Amortized costs and fair values of securities available for sale at September 30, 2023 and December 31, 2022 were as follows:
|  | Amortized Cost |  |  | Gross Unrealized Gains |  |  | Gross Unrealized (Losses) |  |  | Fair Value |
|  | September 30, 2023 |
|  | (in thousands) |
Obligations of U.S. government corporations and agencies |  | $ | 9,259 |  |  | $ | — |  |  | $ | (1,011 | ) |  | $ | 8,248 |
Mortgage-backed securities |  |  | 143,206 |  |  |  | — |  |  |  | (27,616 | ) |  |  | 115,590 |
Obligations of states and political subdivisions |  |  | 6,591 |  |  |  | — |  |  |  | (423 | ) |  |  | 6,168 |
Subordinated debt |  |  | 4,750 |  |  |  | — |  |  |  | (780 | ) |  |  | 3,970 |
|  | $ | 163,806 |  |  | $ | — |  |  | $ | (29,830 | ) |  | $ | 133,976 |
|  | December 31, 2022 |
|  | (in thousands) |
Obligations of U.S. government corporations and agencies |  | $ | 9,993 |  |  | $ | — |  |  | $ | (858 | ) |  | $ | 9,135 |
Mortgage-backed securities |  |  | 153,289 |  |  |  | — |  |  |  | (24,136 | ) |  |  | 129,153 |
Obligations of states and political subdivisions |  |  | 7,027 |  |  |  | 2 |  |  |  | (422 | ) |  |  | 6,607 |
Subordinated debt |  |  | 4,750 |  |  |  | — |  |  |  | (489 | ) |  |  | 4,261 |
|  | $ | 175,059 |  |  | $ | 2 |  |  | $ | (25,905 | ) |  | $ | 149,156 |
The amortized cost and estimated fair value of securities at September 30, 2023, by the earlier of contractual maturity or expected maturity, are shown below. The Company has elected to exclude accrued interest receivable, totaling $396 thousand at September 30, 2023, from the amortized cost basis of securities. Expected maturities will differ from contractual maturities because borrowers may have the right to prepay obligations with or without call or prepayment penalties.
|  | Amortized Cost |  |  | Fair Value |
|  | (in thousands) |
Due in one year or less |  | $ | 1,667 |  |  | $ | 1,646 |
Due after one year through five years |  |  | 5,124 |  |  |  | 4,705 |
Due after five years through ten years |  |  | 20,776 |  |  |  | 18,124 |
Due after ten years |  |  | 136,239 |  |  |  | 109,501 |
|  | $ | 163,806 |  |  | $ | 133,976 |
During the nine months ended September 30, 2023, the Company sold no available for sale securities. During the nine months ended September 30, 2022, the Company sold $15.4 million of available for sale securities recognizing $6 thousand in gross gains and $743 thousand in gross losses. The fair value and gross unrealized losses for securities available for sale, totaled by the length of time that individual securities have been in a continuous gross unrealized loss position, at September 30, 2023 and December 31, 2022 were as follows:
|  | Less than 12 months |  |  | 12 months or more |  |  | Total |
|  | Fair Value |  |  | Gross Unrealized Losses |  |  | Fair Value |  |  | Gross Unrealized Losses |  |  | Fair Value |  |  | Gross Unrealized Losses |
|  | September 30, 2023 |
|  | (in thousands) |
Obligations of U.S. government corporations and agencies |  | $ | — |  |  | $ | — |  |  | $ | 8,248 |  |  | $ | 1,011 |  |  | $ | 8,248 |  |  | $ | 1,011 |
Mortgage-backed securities |  |  | — |  |  |  | — |  |  |  | 115,590 |  |  |  | 27,616 |  |  |  | 115,590 |  |  |  | 27,616 |
Obligations of states and political subdivisions |  |  | 485 |  |  |  | 16 |  |  |  | 5,283 |  |  |  | 407 |  |  |  | 5,768 |  |  |  | 423 |
Subordinated debt |  |  | 218 |  |  |  | 32 |  |  |  | 3,252 |  |  |  | 748 |  |  |  | 3,470 |  |  |  | 780 |
|  | $ | 703 |  |  | $ | 48 |  |  | $ | 132,373 |  |  | $ | 29,782 |  |  | $ | 133,076 |  |  | $ | 29,830 |
|  | Less than 12 months |  |  | 12 months or more |  |  | Total |
|  | Fair Value |  |  | Gross Unrealized Losses |  |  | Fair Value |  |  | Gross Unrealized Losses |  |  | Fair Value |  |  | Gross Unrealized Losses |
|  | December 31, 2022 |
|  | (in thousands) |
Obligations of U.S. government corporations and agencies |  | $ | 6,140 |  |  | $ | 543 |  |  | $ | 2,994 |  |  | $ | 315 |  |  | $ | 9,134 |  |  | $ | 858 |
Mortgage-backed securities |  |  | 31,771 |  |  |  | 4,052 |  |  |  | 97,382 |  |  |  | 20,084 |  |  |  | 129,153 |  |  |  | 24,136 |
Obligations of states and political subdivisions |  |  | 6,065 |  |  |  | 422 |  |  |  | — |  |  |  | — |  |  |  | 6,065 |  |  |  | 422 |
Subordinated debt |  |  | 2,431 |  |  |  | 319 |  |  |  | 1,080 |  |  |  | 170 |  |  |  | 3,511 |  |  |  | 489 |
|  | $ | 46,407 |  |  | $ | 5,336 |  |  | $ | 101,456 |  |  | $ | 20,569 |  |  | $ | 147,863 |  |  | $ | 25,905 |
The reference point for determining when securities are in an unrealized loss position is month end. As such, it is possible that a security's market value exceeded its amortized cost on other days during the past twelve-month period. There were 104 debt securities with a fair value below the amortized cost basis, totaling $133.1 million of aggregate fair value as of September 30, 2023. The Company concluded that a credit loss does not exist in its securities portfolio at September 30, 2023, and no impairment loss has been recognized based on the fact that (1) changes in fair value were caused primarily by fluctuations in interest rates, (2) securities with unrealized losses had generally high credit quality, (3) the Company intends to hold these investments in debt securities to maturity and it is more-likely-than-not that the Company will not be required to sell these investments before a recovery of its investment, and (4) issuers have continued to make timely payments of principal and interest. Additionally, the Company’s mortgage-backed securities are entirely issued by either U.S. government agencies or U.S. government-sponsored enterprises. Collectively, these entities provide a guarantee, which is either explicitly or implicitly supported by the full faith and credit of the U.S. government, that investors in such mortgage-backed securities will receive timely principal and interest payments. Securities having a carrying v alue of $13.8 mi llion at September 30, 2023 were pledged as security for trust accounts. The composition of restricted investments at September 30, 2023 and December 31, 2022 was as follows:
|  | September 30, 2023 |  |  | December 31, 2022 |
|  | (in thousands) |
Federal Reserve Bank Stock |  | $ | 344 |  |  | $ | 944 |
Federal Home Loan Bank Stock |  |  | 8,099 |  |  |  | 8,149 |
Community Bankers’ Bank Stock |  |  | 140 |  |  |  | 140 |
|  | $ | 8,583 |  |  | $ | 9,233 |

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- Definition The entire disclosure for information about available for sale securities. + References No definition available. + Details
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- References No definition available. + Details
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