Securities

3 Months Ended

Mar. 31, 2024

Note 6 – Securities

The following tables summarize the Bank’s holdings for both securities held-to-maturity and securities available-for-sale as of March 31, 2024 and December 31, 2023 (amounts in thousands):


	March 31, 2024
	Amortized		Gross Unrealized				Fair
	Cost		Gains		Losses		Value
Held-to-maturity
U.S. agency obligations	$	3,618	$	—	$	(424)	$	3,194

Available-for-sale
U.S. agency obligations	$	72,610	$	15	$	(7,849)	$	64,776
Mortgage-backed securities		104,916		350		(10,441)		94,825
Municipals		50,828		—		(10,373)		40,455
Corporates		15,520		—		(754)		14,766

	$	243,874	$	365	$	(29,417)	$	214,822



	December 31, 2023
	Amortized		Gross Unrealized				Fair
	Cost		Gains		Losses		Value
Held-to-maturity
U.S. agency obligations	$	3,622	$	—	$	(391)	$	3,231

Available-for-sale
U.S. Treasuries	$	4,985	$	—	$	(38)	$	4,947
U.S. agency obligations		68,515		—		(7,560)		60,955
Mortgage-backed securities		103,992		608		(9,521)		95,079
Municipals		50,856		—		(10,067)		40,789
Corporates		15,523		—		(783)		14,740

	$	243,871	$	608	$	(27,969)	$	216,510

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Note 6 – Securities (continued)

The following tables summarize the fair value of securities available-for-sale as of March 31, 2024 and as of December 31, 2023 and the corresponding amounts of unrealized losses. Management uses the valuation as of month-end in determining when securities are in an unrealized loss position (amounts in thousands):


March 31. 2024	Less than 12 months				More than 12 months				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Losses		Value		Losses		Value		Losses
Available-for-sale
U.S. agency obligations	$	2,048	$	42	$	60,629	$	7,807	$	62,677	$	7,849
Mortgage-backed securities		1,311		6		59,671		10,435		60,982		10,441
Municipals		—		—		40,455		10,373		40,455		10,373
Corporates		—		—		6,766		754		6,766		754

	$	3,359	$	48	$	167,521	$	29,369	$	170,880	$	29,417



December 31, 2023	Less than 12 months				More than 12 months				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Losses		Value		Losses		Value		Losses
Available-for-sale
U.S. Treasuries		—		—		4,947		38		4,947		38
U.S. agency obligations		—		—		60,955		7,560		60,955		7,560
Mortgage-backed securities		—		—		62,242		9,521		62,242		9,521
Municipals		1,799		25		38,990		10,042		40,789		10,067
Corporates		—		—		6,740		783		6,740		783

	$	1,799	$	25	$	173,874	$	27,944	$	175,673	$	27,969

As of March 31, 2024, the Company owned 117 securities in an unrealized loss position. Of the securities, 28 were S&P rated AAA, 82 were rated AA, three were rated A, three were rated BBB, and one was non-rated. As of March 31, 2024, 53 of these securities were municipal issues, 56 were backed directly or indirectly by the U.S. government, and eight were issues of publicly traded domestic corporations. The Company monitors its municipal and corporate securities by periodically reviewing the issuer’s cash-flow and revenue streams, as well as other economic factors that could affect the issuer’s ability to service and/or repay the debt.

The Company has evaluated available-for-sale securities in an unrealized loss position for credit related impairment at March 31, 2024 and concluded no impairment existed based on a combination of factors, which included: (1) the securities are of high credit quality (2) unrealized losses are primarily the result of market volatility and increases in market interest rates, (3) the contractual terms of the investments do not permit the issuers to settle the securities at a price less than the par value of each investment, (4) issuers continue to make timely principal and interest payments, and (5) the Company does not intend to sell any of the investments before recovery of its amortized cost basis, nor is it likely that management will be required to sell the securities. As such, there was not an allowance for credit losses on available-for-sale securities at March 31, 2024.

The Company’s held-to-maturity portfolio is covered by the explicit or implied guarantee of the United States government or one of its agencies and rated investment grade or higher. As a result, the Company did not have an allowance for credit losses on held-to-maturity securities as of March 31, 2024 or December 31, 2023.

All held-to-maturity and available-for-sale securities were current with no securities past due or on nonaccrual as of March 31, 2024.

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Note 6 – Securities (continued)

There were no sales of available-for-sale securities during the three-months ended March 31, 2024 and 2023. As of March 31, 2024, the Company had $41,865 pledged as collateral for public deposits.

The amortized costs and fair values of securities at March 31, 2024, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.


	March 31, 2024
	Amortized
	Costs	Fair Value
Held-to-maturity:
Due in one year or less	$ -	$ -
Due after one year through five years	-	-
Due after five years through ten years	2,421	2,177
Due after ten years	1,197	1,017

Total securities Held-to-maturity	$ 3,618	$ 3,194


	Amortized
	Costs	Fair Value
Available-for-sale:
Due in one year or less	$ 10,502	$ 10,203
Due after one year through five years	37,477	34,286
Due after five years through ten years	64,722	56,765
Due after ten years	131,173	113,568

Total securities Available-for-sale	$ 243,874	$ 214,822