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SECURITIES | 9 Months Ended
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Sep. 30, 2023
SECURITIES [Abstract] |
SECURITIES | NOTE 3 – SECURITIES The following table summarizes the amortized cost and fair value of securities available for sale and securities held to maturity at September 30, 2023 and December 31, 2022, and the corresponding amounts of gross unrealized gains and losses recognized in accumulated other comprehensive (loss) and gross unrecognized gains and losses:
Securities Available for Sale |  | Amortized Cost |  |  | Gross Unrealized Gains |  |  | Gross Unrealized Losses |  |  | Estimated Fair Value |
September 30, 2023 |  |  |  |  |  |  |  |  |  |  |  |
U.S. Government securities |  | $ | 58,717 |  |  | $ | — |  |  | $ | (2,854 | ) |  | $ | 55,863 |
U.S. Government sponsored entity securities |  |  | 6,527 |  |  |  | — |  |  |  | (853 | ) |  |  | 5,674 |
Agency mortgage-backed securities, residential |  |  | 122,446 |  |  |  | — |  |  |  | (17,141 | ) |  |  | 105,305 |
Total securities |  | $ | 187,690 |  |  | $ | — |  |  | $ | (20,848 | ) |  | $ | 166,842 |
December 31, 2022 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Government securities |  | $ | 57,698 |  |  | $ | — |  |  | $ | (2,906 | ) |  | $ | 54,792 |
U.S. Government sponsored entity securities |  |  | 8,845 |  |  |  | — |  |  |  | (862 | ) |  |  | 7,983 |
Agency mortgage-backed securities, residential |  |  | 136,282 |  |  |  | — |  |  |  | (14,983 | ) |  |  | 121,299 |
Total securities |  | $ | 202,825 |  |  | $ | — |  |  | $ | (18,751 | ) |  | $ | 184,074 |
Securities Held to Maturity |  | Amortized Cost |  |  | Gross Unrecognized Gains |  |  | Gross Unrecognized Losses |  |  | Estimated Fair Value |  |  | Allowance for Credit Losses |
September 30, 2023 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Obligations of states and political subdivisions |  | $ | 8,947 |  |  | $ | 13 |  |  | $ | (1,032 | ) |  | $ | 7,928 |  |  | $ | (2 | )
Agency mortgage-backed securities, residential |  |  | 1 |  |  |  | — |  |  |  | — |  |  |  | 1 |  |  |  | — |
Total securities |  | $ | 8,948 |  |  | $ | 13 |  |  | $ | (1,032 | ) |  | $ | 7,929 |  |  | $ | (2 | )
December 31, 2022 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Obligations of states and political subdivisions |  | $ | 9,225 |  |  | $ | 32 |  |  | $ | (798 | ) |  | $ | 8,459 |  |  |  |  |
Agency mortgage-backed securities, residential |  |  | 1 |  |  |  | — |  |  |  | — |  |  |  | 1 |  |  |  |  |
Total securities |  | $ | 9,226 |  |  | $ | 32 |  |  | $ | (798 | ) |  | $ | 8,460 |  |  |  |  |
The amortized cost and estimated fair value of debt securities at September 30, 2023, by contractual maturity, are shown below. Actual maturities may differ from contractual maturities because certain issuers may have the right to call or prepay the debt obligations prior to their contractual maturities. Securities not due at a single maturity are shown separately.
|  | Available for Sale |  |  | Held to Maturity |
Debt Securities: |  | Amortized Cost |  |  | Estimated Fair Value |  |  | Amortized Cost |  |  | Estimated Fair Value |
Due in one year or less |  | $ | 18,390 |  |  | $ | 18,203 |  |  | $ | 585 |  |  | $ | 584 |
Due in over one to five years |  |  | 46,854 |  |  |  | 43,334 |  |  |  | 3,885 |  |  |  | 3,658 |
Due in over five to ten years |  |  | — |  |  |  | — |  |  |  | 2,207 |  |  |  | 1,850 |
Due after ten years |  |  | — |  |  |  | — |  |  |  | 2,270 |  |  |  | 1,836 |
Agency mortgage-backed securities, residential |  |  | 122,446 |  |  |  | 105,305 |  |  |  | 1 |  |  |  | 1 |
Total debt securities |  | $ | 187,690 |  |  | $ | 166,842 |  |  | $ | 8,948 |  |  | $ | 7,929 |
There were no sales of securities during the three and nine months ended September 30, 2023 and 2022. Debt securities with a carrying value of approximately $134,812 at September 30, 2023 and $126,318 at December 31, 2022, were pledged to secure public deposits, repurchase agreements, and for other purposes required or permitted by law. The following table summarizes debt securities available for sale in an unrealized loss position for which an allowance for credit losses has not been recorded at September 30, 2023 and December 31, 2022, aggregated by major security type and length of time in a continuous unrealized loss position:
September 30, 2023 |  | Less Than 12 Months |  |  | 12 Months or More |  |  | Total |
|  | Fair Value |  |  | Unrealized Loss |  |  | Fair Value |  |  | Unrealized Loss |  |  | Fair Value |  |  | Unrealized Loss |
Securities Available for Sale |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Government securities |  | $ | 12,257 |  |  | $ | (232 | ) |  | $ | 43,606 |  |  | $ | (2,622 | ) |  | $ | 55,863 |  |  | $ | (2,854 | )
U.S. Government sponsored entity securities |  |  | — |  |  |  | — |  |  |  | 5,674 |  |  |  | (853 | ) |  |  | 5,674 |  |  |  | (853 | )
Agency mortgage-backed securities, |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
residential |  |  | — |  |  |  | — |  |  |  | 105,305 |  |  |  | (17,141 | ) |  |  | 105,305 |  |  |  | (17,141 | )
Total available for sale |  | $ | 12,257 |  |  | $ | (232 | ) |  | $ | 154,585 |  |  | $ | (20,616 | ) |  | $ | 166,842 |  |  | $ | (20,848 | )
December 31, 2022 |  | Less Than 12 Months |  |  | 12 Months or More |  |  | Total |
|  | Fair Value |  |  | Unrealized Loss |  |  | Fair Value |  |  | Unrealized Loss |  |  | Fair Value |  |  | Unrealized Loss |
Securities Available for Sale |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Government securities |  | $ | 36,460 |  |  | $ | (977 | ) |  | $ | 18,332 |  |  | $ | (1,929 | ) |  | $ | 54,792 |  |  | $ | (2,906 | )
U.S Government sponsored entity securities |  |  | 2,786 |  |  |  | (60 | ) |  |  | 5,197 |  |  |  | (802 | ) |  |  | 7,983 |  |  |  | (862 | )
Agency mortgage-backed securities, |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
residential |  |  | 71,510 |  |  |  | (7,178 | ) |  |  | 49,789 |  |  |  | (7,805 | ) |  |  | 121,299 |  |  |  | (14,983 | )
Total available for sale |  | $ | 110,756 |  |  | $ | (8,215 | ) |  | $ | 73,318 |  |  | $ | (10,536 | ) |  | $ | 184,074 |  |  | $ | (18,751 | )
Management evaluates available for sale debt securities in unrealized positions to determine whether impairment is due to credit-related factors. Consideration is given to (1) the extent to which the fair value is less than cost, (2) the financial condition and near-term prospects of the issuer, and (3) the intent and ability of the Company to retain its investment in the security for a period of time sufficient to allow for any anticipated recovery in fair value. At September 30, 2023, the Company had 102 available for sale debt securities in an unrealized position without an allowance for credit losses, of which 19 were from U.S. Government securities, 3 were from U.S. Government sponsored entity securities, and 80 were from Agency mortgage-backed residential securities. Management does not have the intent to sell any of these securities and believes that it is more likely than not that the Company will not have to sell any such securities before a recovery of cost. The fair value is expected to recover as the securities approach their maturity date or repricing date or if market yields for such investments decline. Accordingly, as of September 30, 2023, management believes that the unrealized losses detailed in the previous table are due to noncredit-related factors, including changes in interest rates and other market conditions and, therefore, the Company carried no allowance for credit losses on available for sale debt securities at September 30, 2023. The following table presents the activity in the allowance for credit losses for held to maturity debt securities:
Held to Maturity Debt Securities |  | Nine months ended September 30, 2023 |
Allowance for credit losses: |  |  |
Beginning balance |  | $ | — |
Impact of adopting ASC 326 |  |  | 3 |
Provision for (recovery of) credit loss expense |  |  | (1 | )
Allowance for credit losses ending balance |  | $ | 2 |
The Company’s held to maturity securities primarily consist of obligations of states and political subdivisions. The ACL on held to maturity securities is estimated at each measurement date on a collective basis by major security type. Risk factors such as issuer bond ratings, historical loss rates, financial condition of issuer, and timely principal and interest payments of issuer were evaluated to determine if a credit reserve was required within the portfolio. At September 30, 2023, there were no past due principal and interest payments related to held to maturity securities. Upon adoption of ASC 326 on January 1, 2023, the Company identified a cumulative loss rate of .03% using historical loss data provided by S&P and Moody’s bond rating service. This resulted in a $3 credit loss reserve for held to maturity debt securities. During the third quarter of 2023, the cumulative loss rate decreased to 0.02%, resulting in a $1 recovery of provision expense during the three and nine months ended September 30, 2023.

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