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v3.23.3

Fair Value and Interest Rate Risk (Tables) | 6 Months Ended
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Jun. 30, 2023
Fair Value Disclosures [Abstract] |
Fair Value, by Balance Sheet Grouping | The following table provides a comparison of the carrying amounts and estimated fair values of Patriot’s financial assets and liabilities as of June 30, 2023 and December 31, 2022:
(In thousands) |  |  | June 30, 2023 |  | December 31, 2022
| Fair Value Hierarchy |  | Carrying Amount |  | Estimated Fair Value |  | Carrying Amount |  | Estimated Fair Value
Financial Assets: |  |  |  |  |  |  |  |  |
Cash and noninterest bearing balances due from banks | Level 1 |  | $ | 2,320 |  |  | $ | 2,320 |  |  | $ | 5,182 |  |  | $ | 5,182 |
Interest-bearing deposits due from banks | Level 1 |  | 68,489 |  |  | 68,489 |  |  | 33,311 |  |  | 33,311 |
Available-for-sale securities | Level 2 |  | 80,665 |  |  | 80,665 |  |  | 75,093 |  |  | 75,093 |
Available-for-sale securities | Level 3 |  | 9,882 |  |  | 9,882 |  |  | 9,427 |  |  | 9,427 |
Other investments | Level 2 |  | 4,450 |  |  | 4,450 |  |  | 4,450 |  |  | 4,450 |
Federal Reserve Bank stock | Level 2 |  | 2,523 |  |  | 2,523 |  |  | 2,627 |  |  | 2,627 |
Federal Home Loan Bank stock | Level 2 |  | 8,072 |  |  | 8,072 |  |  | 3,874 |  |  | 3,874 |
Loans receivable, net | Level 3 |  | 906,636 |  |  | 893,639 |  |  | 838,006 |  |  | 818,960 |
Loans held for sale | Level 2 |  | 5,860 |  |  | 6,320 |  |  | 5,211 |  |  | 5,534 |
SBA servicing assets | Level 3 |  | 882 |  |  | 977 |  |  | 886 |  |  | 1,013 |
Accrued interest receivable | Level 2 |  | 7,628 |  |  | 7,628 |  |  | 7,267 |  |  | 7,267 |
Interest rate swap receivable | Level 2 |  | 244 |  |  | 244 |  |  | 203 |  |  | 203 |
Financial assets, total |  |  | $ | 1,097,651 |  |  | $ | 1,085,209 |  |  | $ | 985,537 |  |  | $ | 966,941 |
Financial Liabilities: |  |  |  |  |  |  |  |  |
Demand deposits | Level 2 |  | $ | 127,817 |  |  | $ | 127,817 |  |  | $ | 269,636 |  |  | $ | 269,636 |
Savings deposits | Level 2 |  | 50,981 |  |  | 50,981 |  |  | 71,002 |  |  | 71,002 |
Money market deposits | Level 2 |  | 298,717 |  |  | 298,717 |  |  | 211,000 |  |  | 211,000 |
Negotiable order of withdrawal accounts | Level 2 |  | 37,970 |  |  | 37,970 |  |  | 34,440 |  |  | 34,440 |
Time deposits | Level 2 |  | 238,768 |  |  | 235,475 |  |  | 225,670 |  |  | 221,353 |
Brokered deposits | Level 1 |  | 109,126 |  |  | 108,641 |  |  | 48,698 |  |  | 47,684 |
FHLB and other borrowings | Level 2 |  | 207,000 |  |  | 205,964 |  |  | 85,000 |  |  | 83,853 |
Senior notes | Level 2 |  | 11,653 |  |  | 11,127 |  |  | 11,640 |  |  | 11,103 |
Subordinated debt | Level 2 |  | 9,854 |  |  | 9,826 |  |  | 9,840 |  |  | 9,680 |
Junior subordinated debt owed to unconsolidated trust | Level 2 |  | 8,132 |  |  | 8,132 |  |  | 8,128 |  |  | 8,128 |
Note payable | Level 3 |  | 481 |  |  | 455 |  |  | 585 |  |  | 544 |
Accrued interest payable | Level 2 |  | 1,117 |  |  | 1,117 |  |  | 585 |  |  | 585 |
Interest rate swap liability | Level 2 |  | 244 |  |  | 244 |  |  | 203 |  |  | 203 |
Financial liabilities, total |  |  | $ | 1,101,860 |  |  | $ | 1,096,466 |  |  | $ | 976,427 |  |  | $ | 969,211 |
Fair Value, Assets Measured on Recurring Basis | The following tables detail the financial assets measured at fair value on a recurring basis and the valuation techniques utilized relative to the fair value hierarchy, as of June 30, 2023 and December 31, 2022:
(In thousands) | Quoted Prices in Active Markets for Identical Assets (Level 1) |  | Significant Observable Inputs (Level 2) |  | Significant Unobservable Inputs (Level 3) |  | Total
June 30, 2023: |  |  |  |  |  |  |
U. S. Government agency and mortgage-backed securities | $ | — |  |  | $ | 67,248 |  |  | $ | — |  |  | $ | 67,248 |
Corporate bonds | — |  |  | 3,373 |  |  | 9,882 |  |  | 13,255 |
Subordinated notes | — |  |  | 4,236 |  |  | — |  |  | 4,236 |
SBA loan pools | — |  |  | 5,326 |  |  | — |  |  | 5,326 |
Municipal bonds | — |  |  | 482 |  |  | — |  |  | 482 |
Available-for-sale securities | $ | — |  |  | $ | 80,665 |  |  | $ | 9,882 |  |  | $ | 90,547 |
Interest rate swap receivable | $ | — |  |  | $ | 244 |  |  | $ | — |  |  | $ | 244 |
Interest rate swap liability | $ | — |  |  | $ | 244 |  |  | $ | — |  |  | $ | 244 |
December 31, 2022: |  |  |  |  |  |  |
U. S. Government agency and mortgage-backed securities | $ | — |  |  | $ | 59,046 |  |  | $ | — |  |  | $ | 59,046 |
Corporate bonds | — |  |  | 5,228 |  |  | 9,427 |  |  | 14,655 |
Subordinated notes | — |  |  | 4,602 |  |  | — |  |  | 4,602 |
SBA loan pools | — |  |  | 5,718 |  |  | — |  |  | 5,718 |
Municipal bonds | — |  |  | 499 |  |  | — |  |  | 499 |
Available-for-sale securities | $ | — |  |  | $ | 75,093 |  |  | $ | 9,427 |  |  | $ | 84,520 |
Interest rate swap receivable | $ | — |  |  | $ | 203 |  |  | $ | — |  |  | $ | 203 |
Interest rate swap liability | $ | — |  |  | $ | 203 |  |  | $ | — |  |  | $ | 203 |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation | The reconciliation of the beginning and ending balances during 2023 for Level 3 available-for-sale securities is as follows:
| Three Months Ended June 30, |  | Six Months Ended June 30,
(In thousands) | 2023 |  | 2022 |  | 2023 |  | 2022
Level 3 fair value, beginning of year | $ | 10,205 |  |  | $ | 11,237 |  |  | $ | 9,427 |  |  | $ | 13,180 |
Purchases | — |  |  | — |  |  | — |  |  | — |
Realized gain (loss) | — |  |  | — |  |  | — |  |  | — |
Unrealized gain (loss) | (323) |  |  | (895) |  |  | 455 |  |  | (2,838) |
Transfers in and /or out of Level 3 | — |  |  | — |  |  | — |  |  | — |
Level 3 fair value, end of year | $ | 9,882 |  |  | $ | 10,342 |  |  | $ | 9,882 |  |  | $ | 10,342 |
Fair Value Measurement Inputs and Valuation Techniques | The table below presents the valuation methodology and unobservable inputs for level 3 assets measured at fair value on a non-recurring basis as of June 30, 2023 and December 31, 2022:
(In thousands) | Fair Value |  | Valuation Methodology |  | Unobservable Inputs |  | Range of Inputs
June 30, 2023: |  |  |  |  |  |  |  |  |
Impaired loans, net | $ | 13,003 |  |  | Real Estate Appraisals |  | Discount for appraisal type |  | 5.8 | % | - | 20%
SBA servicing assets | 977 |  |  | Discounted Cash Flows |  | Market discount rates |  | 14.73 | % | - | 14.90%
December 31, 2022: |  |  |  |  |  |  |  |  |
Impaired loans, net | $ | 12,873 |  |  | Real Estate Appraisals |  | Discount for appraisal type |  | 5.8 | % | - | 20%
SBA servicing assets | 1,013 |  |  | Discounted Cash Flows |  | Market discount rates |  | 14.73 | % | - | 14.90%

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