Note 11 – Fair Value Of Financial Instruments

Financial instruments require disclosure of fair value information, whether or not recognized in the consolidated balance sheets, when it is practical to estimate the fair value. A financial instrument is defined as cash, evidence of an ownership interest in an entity or a contractual obligation which requires the exchange of cash. Certain items are specifically excluded from the financial instrument fair value disclosure requirements, including the Company’s common stock, foreclosed real estate, premises and equipment and other assets and liabilities.

The estimated fair value amounts have been determined by the Company using available market information and appropriate valuation methodologies. However, considerable judgment is required to interpret market data to develop the estimates of fair value. Accordingly, the estimates presented herein are not necessarily indicative of the amounts the Company could realize in a current market exchange. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. Therefore, any aggregate unrealized gains or losses should not be interpreted as a forecast of future earnings or cash flows. Furthermore, the fair values disclosed should not be interpreted as the aggregate current value of the Company.

The Company’s estimated fair values of financial instruments are presented in the following table.


		June 30, 2025				December 31, 2024
	Fair value	Carrying		Fair		Carrying		Fair
(dollars in thousands)	hierarchy	amount		value		amount		value

Financial assets
Cash and cash equivalents	Level 1	$	56,323	$	56,323	$	70,500	$	70,500
Equity investment	Level 1		406		406		391		391
Securities held to maturity	Level 2		5,832		5,128		5,979		5,171
Securities held to available for sale	Level 2		35,359		35,359		37,259		37,259
Federal Home Loan Bank of Atlanta stock	Level 2		656		656		1,366		1,366
Loans receivable	Level 3		742,414		743,944		729,238		722,005
Accrued interest receivable	Level 2		3,243		3,243		3,161		3,161

Financial liabilities
Deposits	Level 3	$	658,891	$	585,332	$	651,491	$	574,273
FHLB Borrowings	Level 2		—		—		15,000		15,000
Subordinated Debentures	Level 3		34,961		32,977		34,883		31,117
Accrued interest payable	Level 2		645		645		346		346