Fair Value and Interest Rate Risk (Tables)

12 Months Ended

Dec. 31, 2024

Schedule of 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 December 31, 2024 and 2023:


(In thousands)		December 31, 2024				December 31, 2023
	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	$	3,295	$	3,295	$	2,195	$	2,195
Interest-bearing deposits due from banks	Level 1	144,273		144,273		50,322		50,322
Restricted cash	Level 1	15,042		15,042		14,019		14,019
Available-for-sale securities	Level 2	68,869		68,869		78,925		78,925
Available-for-sale securities	Level 3	11,123		11,123		10,262		10,262
Other investments	Level 2	4,450		4,450		4,450		4,450
Federal Reserve Bank stock	Level 2	1,377		1,377		2,090		2,090
Federal Home Loan Bank stock	Level 2	779		779		4,202		4,202
Loans receivable, net	Level 3	700,167		675,901		832,934		812,856
Loans held for sale	Level 2	15,702		15,702		20,767		21,557
Servicing assets	Level 3	766		852		857		932
Other real estate owned	Level 2	2,843		2,843		2,843		2,843
Accrued interest receivable	Level 2	5,488		5,488		7,219		7,219
Interest rate swap receivable	Level 2	83		83		74		74

Financial assets, total		$	974,257	$	950,077	$	1,031,159	$	1,011,946

Financial Liabilities:
Demand deposits	Level 2	$	119,212	$	119,212	$	110,056	$	110,056
Negotiable order of withdrawal accounts	Level 2	31,549		31,549		33,035		33,035
Savings deposits	Level 2	38,743		38,743		44,104		44,104
Interest bearing DDA	Level 2	205,995		205,995		171,577		171,577
Money market deposits	Level 2	262,023		262,023		200,280		200,280
Time deposits	Level 2	239,373		239,077		240,733		239,655
Brokered deposits	Level 1	69,702		69,435		40,526		40,453
FHLB, FRB and correspondent bank borrowings	Level 2	3,000		3,000		171,000		170,171
Senior notes	Level 2	11,861		11,677		11,723		11,397
Subordinated debt	Level 2	9,898		9,575		9,869		10,102
Junior subordinated debt owed to unconsolidated trust	Level 2	8,147		8,147		8,137		8,137
Note payable	Level 3	162		158		376		362
Accrued interest payable	Level 2	1,417		1,417		1,235		1,235
Interest rate swap liability	Level 2	83		83		74		74

Financial liabilities, total		$	1,001,165	$	1,000,091	$	1,042,725	$	1,040,638

Schedule of 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 December 31, 2024 and 2023.


(In thousands)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
December 31, 2024:
U. S. Government agency and mortgage-backed securities	$	—	$	60,223	$	—	$	60,223
Corporate bonds	—		1,612		11,123		12,735
Subordinated notes	—		3,461		—		3,461
SBA loan pools	—		3,573		—		3,573


Available-for-sale securities	$	—	$	68,869	$	11,123	$	79,992

Interest rate swap receivable	$	—	$	83	$	—	$	83

Interest rate swap liability	$	—	$	83	$	—	$	83

December 31, 2023:
U. S. Government agency and mortgage-backed securities	$	—	$	65,671	$	—	$	65,671
Corporate bonds	—		3,504		10,262		13,766
Subordinated notes	—		4,227		—		4,227
SBA loan pools	—		5,037		—		5,037
Municipal bonds	—		486		—		486

Available-for-sale securities	$	—	$	78,925	$	10,262	$	89,187

Interest rate swap receivable	$	—	$	74	$	—	$	74

Interest rate swap liability	$	—	$	74	$	—	$	74

Schedule of Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation

The reconciliation of the beginning and ending balances for Level 3 available-for-sale securities for the years ended December 31, 2024, 2023 and 2022 is as follows:


	Year Ended December 31,
	2024		2023		2022
Level 3 fair value, beginning of period	$	10,262	$	9,427	$	13,180
Purchases	—		—		—
Realized gain (loss)	—		—		—
Unrealized gain (loss)	861		835		(3,753)
Transfers in and /or out of Level 3	—		—		—
Level 3 fair value, end of period	$	11,123	$	10,262	$	9,427

Schedule of 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 December 31, 2024 and 2023:


(In thousands)	Fair Value		Valuation Methodology	Unobservable Inputs	Range of Inputs
December 31, 2024:

Individually evaluated loans, net	$	24,552	Real Estate Appraisals	Discount for appraisal type	5.8%		-	20%

Servicing assets	852		Discounted Cash Flows	Market discount rates	14.73%		-	14.90%

December 31, 2023:

Individually evaluated loans, net	$	12,928	Real Estate Appraisals	Discount for appraisal type	5.8%		-	20%

Servicing assets	932		Discounted Cash Flows	Market discount rates	14.73	%	-	14.90	%

- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

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