v3.25.2
Investment Securities
 6 Months Ended
Jun. 30, 2025
Investments, Debt and Equity Securities [Abstract]  
Investment Securities Investment Securities
The following table summarizes the amortized cost and estimated fair value of investment securities at June 30, 2025:
Amortized
Cost		Unrealized GainsUnrealized LossesFair Value (Estimated)
Securities available for sale
U.S. Treasury & Agency securities$24,544,000 $— $(5,510,000)$19,034,000 
Mortgage-backed securities258,633,000 487,000 (34,704,000)224,416,000 
State and political subdivisions40,087,000 — (7,400,000)32,687,000 
Asset-backed securities2,117,000 10,000 (16,000)2,111,000 
$325,381,000 $497,000 $(47,630,000)$278,248,000 
Securities to be held to maturity
U.S. Treasury & Agency securities$38,100,000 $— $(8,879,000)$29,221,000 
Mortgage-backed securities50,510,000 78,000 (10,211,000)40,377,000 
State and political subdivisions251,461,000 44,000 (34,833,000)216,672,000 
Corporate securities28,000,000 — (1,762,000)26,238,000 
$368,071,000 $122,000 $(55,685,000)$312,508,000 
Less allowance for credit losses(198,000)— — — 
Net securities to be held to maturity$367,873,000 $122,000 $(55,685,000)$312,508,000 
Restricted equity securities
Federal Home Loan Bank Stock$6,697,000 $— $— $6,697,000 
Federal Reserve Bank Stock1,037,000 — — 1,037,000 
$7,734,000 $— $— $7,734,000 
The following table summarizes the amortized cost and estimated fair value of investment securities at December 31, 2024:
Amortized
Cost		Unrealized GainsUnrealized LossesFair Value (Estimated)
Securities available for sale
U.S. Treasury & Agency securities$26,042,000 $— $(6,246,000)$19,796,000 
Mortgage-backed securities260,267,000 141,000 (41,026,000)219,382,000 
State and political subdivisions40,148,000 — (6,896,000)33,252,000 
Asset-backed securities2,236,000 14,000 — 2,250,000 
$328,693,000 $155,000 $(54,168,000)$274,680,000 
Securities to be held to maturity
U.S. Treasury & Agency securities$38,100,000 $— $(9,938,000)$28,162,000 
Mortgage-backed securities52,370,000 15,000 (11,360,000)41,025,000 
State and political subdivisions252,180,000 83,000 (31,739,000)220,524,000 
Corporate securities27,250,000 — (1,968,000)25,282,000 
$369,900,000 $98,000 $(55,005,000)$314,993,000 
Less allowance for credit losses(196,000)— — — 
Net securities to be held to maturity$369,704,000 $98,000 $(55,005,000)$314,993,000 
Restricted equity securities
Federal Home Loan Bank Stock$6,166,000 $— $— $6,166,000 
Federal Reserve Bank Stock1,037,000 — — 1,037,000 
$7,203,000 $— $— $7,203,000 
The following table summarizes the amortized cost and estimated fair value of investment securities at June 30, 2024:
Amortized
Cost		Unrealized GainsUnrealized LossesFair Value (Estimated)
Securities available for sale
U.S. Treasury & Agency securities$26,038,000 $— $(6,260,000)$19,778,000 
Mortgage-backed securities259,574,000 50,000 (41,801,000)217,823,000 
State and political subdivisions40,272,000 — (6,902,000)33,370,000 
Asset-backed securities2,514,000 19,000 (3,000)2,530,000 
$328,398,000 $69,000 $(54,966,000)$273,501,000 
Securities to be held to maturity
U.S. Treasury & Agency securities$38,100,000 $— $(10,063,000)$28,037,000 
Mortgage-backed securities54,501,000 11,000 (11,352,000)43,160,000 
State and political subdivisions252,820,000 105,000 (32,268,000)220,657,000 
Corporate securities32,250,000 — (2,488,000)29,762,000 
$377,671,000 $116,000 $(56,171,000)$321,616,000 
Less allowance for credit losses(149,000)— — — 
Net securities to be held to maturity$377,522,000 $116,000 $(56,171,000)$321,616,000 
Restricted equity securities
Federal Home Loan Bank Stock$6,073,000 $— $— $6,073,000 
Federal Reserve Bank Stock1,037,000 — — 1,037,000 
$7,110,000 $— $— $7,110,000 
Allowance for Credit Losses: AFS securities, as shown in the above tables, consist of securities issued by U.S. Government Agencies, U.S. Government Sponsored Entities, State or Local Municipal Governments, or are backed by collateral that is guaranteed by the U.S. Government. We monitor the credit quality of these investments through credit ratings issued by major rating providers and through substantial price changes not consistent with general market movements. Each of the AFS securities is deemed to be investment grade, and no ACL has been established for AFS securities.
Similarly, the agency and mortgage-backed securities in the HTM portfolio have been determined to all be investment grade with no ACL required. Municipal securities within HTM include two private activity bonds issued by well-known customers of the Bank with total balances of $18,690,000 as of June 30, 2025. Corporate securities in HTM consist of 14 individual companies in the banking industry. Management reviewed the collectability of these securities taking into consideration such factors as the financial condition of the issuers, reported regulatory capital ratios of the issuers, and other performance factors. Aggregate credit risk of the private activity bonds and corporate securities is considered very low and an immaterial ACL has been established. As of June 30, 2025 and 2024, and December 31, 2024, the total ACL for HTM securities was $198,000, $149,000 and $196,000, respectively.
Changes in the ACL are recorded as credit loss expense, or reversal. Losses would be charged against the allowance when management believes collection of the full contractual amount due on a security is unlikely.
Contractual Maturities: The following table summarizes the contractual maturities of investment securities at June 30, 2025:
Securities available for saleSecurities to be held to maturity
Amortized
Cost		Fair Value (Estimated)Amortized
Cost		Fair Value (Estimated)
Due in 1 year or less$1,520,000 $1,514,000 $3,449,000 $3,451,000 
Due in 1 to 5 years1,144,000 1,032,000 25,972,000 24,904,000 
Due in 5 to 10 years28,577,000 25,480,000 107,248,000 99,952,000 
Due after 10 years294,140,000 250,222,000 231,402,000 184,201,000 
$325,381,000 $278,248,000 $368,071,000 $312,508,000 
The following table summarizes the contractual maturities of investment securities at December 31, 2024:
Securities available for saleSecurities to be held to maturity
Amortized
Cost		Fair Value (Estimated)Amortized
Cost		Fair Value (Estimated)
Due in 1 year or less$2,997,000 $2,967,000 $2,683,000 $2,694,000 
Due in 1 to 5 years294,000 293,000 20,488,000 19,335,000 
Due in 5 to 10 years29,768,000 25,700,000 99,505,000 92,362,000 
Due after 10 years295,634,000 245,720,000 247,224,000 200,602,000 
$328,693,000 $274,680,000 $369,900,000 $314,993,000 
The following table summarizes the contractual maturities of investment securities at June 30, 2024:
Securities available for saleSecurities to be held to maturity
Amortized
Cost		Fair Value (Estimated)Amortized
Cost		Fair Value (Estimated)
Due in 1 year or less$1,497,000 $1,464,000 $322,000 $321,000 
Due in 1 to 5 years1,940,000 1,887,000 20,181,000 19,361,000 
Due in 5 to 10 years28,319,000 24,353,000 101,723,000 93,597,000 
Due after 10 years296,642,000 245,797,000 255,445,000 208,337,000 
$328,398,000 $273,501,000 $377,671,000 $321,616,000 

Pledged Securities: At June 30, 2025, securities with a carrying value of $347,745,000 were pledged to secure public deposits, repurchase agreements, and for other purposes as required by law. This compares to securities with a carrying value of $349,833,000 as of December 31, 2024 and $310,931,000 at June 30, 2024, pledged for the same purposes.

Realized Gains and Losses: Gains and losses on the sale of securities are computed by subtracting the amortized cost at the time of sale from the security's selling price, net of accrued interest to be received. There were no gains or losses on the sale of securities for the six months ended June 30, 2025 and 2024.

Unrealized Gains and Losses on AFS Securities: As of June 30, 2025, there were 235 AFS securities with unrealized losses held in the Company's portfolio. The Company has the ability and intent to hold its securities which are in an unrealized loss position until a recovery of their amortized cost, which may be at maturity.
The following table summarizes AFS debt securities in an unrealized loss position for which an ACL has not been recorded at June 30, 2025, aggregated by major security type and length of time in a continuous unrealized loss position:
Less than 12 months12 months or moreTotal
Fair Value (Estimated)Unrealized LossesFair Value (Estimated)Unrealized LossesFair Value (Estimated)Unrealized Losses
U.S. Treasury & Agency securities$— $— $19,034,000 $(5,510,000)$19,034,000 $(5,510,000)
Mortgage-backed securities5,994,000 (91,000)182,167,000 (34,613,000)188,161,000 (34,704,000)
State and political subdivisions4,791,000 (241,000)27,716,000 (7,159,000)32,507,000 (7,400,000)
Asset-backed securities1,151,000 (16,000)— — 1,151,000 (16,000)
$11,936,000 $(348,000)$228,917,000 $(47,282,000)$240,853,000 $(47,630,000)
As of December 31, 2024, there were 243 AFS securities with unrealized losses held in the Company's portfolio. The Company has the ability and intent to hold its securities which are in an unrealized loss position until a recovery of their amortized cost, which may be at maturity.
The following table summarizes AFS debt securities in an unrealized loss position for which an ACL has not been recorded at December 31, 2024 aggregated by major security type and length of time in a continuous unrealized loss position:
Less than 12 months12 months or moreTotal
Fair Value (Estimated)Unrealized LossesFair Value (Estimated)Unrealized LossesFair Value (Estimated)Unrealized Losses
U.S. Treasury & Agency securities$— $— $19,796,000 $(6,246,000)$19,796,000 $(6,246,000)
Mortgage-backed securities18,544,000 (222,000)186,155,000 (40,804,000)204,699,000 (41,026,000)
State and political subdivisions4,968,000 (70,000)28,104,000 (6,826,000)33,072,000 (6,896,000)
$23,512,000 $(292,000)$234,055,000 $(53,876,000)$257,567,000 $(54,168,000)
As of June 30, 2024, there were 238 AFS securities with unrealized losses held in the Company's portfolio. The Company has the ability and intent to hold its securities which are in an unrealized loss position until a recovery of their amortized cost, which may be at maturity.
The following table summarizes AFS debt securities in an unrealized loss position for which an ACL has not been recorded at June 30, 2024 aggregated by major security type and length of time in a continuous unrealized loss position:
Less than 12 months12 months or moreTotal
Fair Value (Estimated)Unrealized LossesFair Value (Estimated)Unrealized LossesFair Value (Estimated)Unrealized Losses
U.S. Treasury & Agency securities$— $— $19,778,000 $(6,260,000)$19,778,000 $(6,260,000)
Mortgage-backed securities8,451,000 (43,000)197,155,000 (41,758,000)205,606,000 (41,801,000)
State and political subdivisions4,484,000 (62,000)28,616,000 (6,840,000)33,100,000 (6,902,000)
Asset-backed securities1,300,000 (3,000)— — 1,300,000 (3,000)
$14,235,000 $(108,000)$245,549,000 $(54,858,000)$259,784,000 $(54,966,000)

Credit Quality Indicators: Agency-backed and government-sponsored enterprise securities have a long history with no credit losses, including during times of severe stress. The principal and interest payments on agency-guaranteed debt is backed by the U.S. Government. Government-sponsored enterprises similarly guarantee principal and interest payments and carry an implicit guarantee from the U.S. Department of the Treasury. Additionally, government-sponsored enterprise securities are exceptionally liquid, readily marketable, and provide a substantial amount of price transparency and price parity, indicating a perception of zero credit losses. HTM municipal debt holdings are comprised primarily of high credit quality (rated A- or higher) state and municipal obligations. High credit quality state and municipal obligations have a history of zero to near-zero credit loss. All of the Mortgage-backed securities owned were issued either by GNMA, FNMA or FHLMC. HTM municipal debt holdings also include two unrated private activity bonds issued by well known customers of the Bank. These securities are regularly monitored as part of an overall credit relationship with the issuers; both issuers were in good standing as of June 30, 2025. HTM corporate debt holdings consist of 14 individual companies in the banking industry. Management conducts periodic reviews of the collectability of these securities taking into consideration such factors as the financial condition of the issuers; each issuer was in good standing as of June 30, 2025.
ACL for HTM Securities: The following tables present the activity in the ACL for HTM debt securities by major security type for the six months and quarters ended June 30, 2025 and 2024:
For the six months ended June 30, 2025For the six months ended June 30, 2024
State and Political SubdivisionsCorporate SecuritiesTotalState and Political SubdivisionsCorporate SecuritiesTotal
Allowance for credit losses:
   Beginning balance$80,000 $116,000 $196,000 $212,000 $222,000 $434,000 
   Credit loss (reduction) expense1
(1,000)3,000 2,000 (156,000)(129,000)(285,000)
   Securities charged-off— — — — — — 
   Recoveries— — — — — — 
   Total ending allowance balance$79,000 $119,000 $198,000 $56,000 $93,000 $149,000 
1June 30, 2024 total of (285,000) will not tie to Consolidated Statement of Income Credit loss reduction - debt securities HTM due to rounding.
For the three months ended June 30, 2025For the three months ended June 30, 2024
State and Political SubdivisionsCorporate SecuritiesTotalState and Political SubdivisionsCorporate SecuritiesTotal
Allowance for credit losses:
   Beginning balance$81,000 $116,000 $197,000 $69,000 $113,000 $182,000 
   Credit loss (reduction) expense1
(2,000)3,000 1,000 (13,000)(20,000)(33,000)
   Securities charged-off— — — — — — 
   Recoveries— — — — — — 
   Total ending allowance balance$79,000 $119,000 $198,000 $56,000 $93,000 $149,000 
1June 30, 2024 total of (33,000) will not tie to Consolidated Statement of Income Credit loss reduction - debt securities HTM due to rounding.

There was no ACL on U.S. Government-sponsored enterprise, agency securities, or mortgage-backed securities as of June 30, 2025. A security is considered to be past due once it is 30 days contractually past due under the terms of the agreement. As of June 30, 2025, none of the Company’s HTM debt securities were past due or on non-accrual status.

Re-Classified Securities: During the third quarter of 2014, the Company transferred securities with a total amortized cost of $89,780,000 with a corresponding fair value of $89,757,000 from available for sale to held to maturity. The net unrealized loss, net of taxes, on these securities at the date of the transfer was $15,000. The net unrealized holding loss at the time of transfer continues to be reported in AOCI, net of tax and is amortized over the remaining lives of the securities as an adjustment of the yield. The amortization of the net unrealized loss reported in AOCI will offset the effect on interest income of the discount for the transferred securities. The remaining unamortized balance of the net unrealized losses for the securities transferred from available for sale to held to maturity was $60,000, net of taxes, at June 30, 2025. This compares to $47,000 and $51,000, net of taxes, at December 31, 2024 and June 30, 2024, respectively. These securities were transferred as a part of the Company's overall investment and balance sheet strategies.

Restricted Equity Securities: The Bank is a member of the FHLBB, a cooperatively owned wholesale bank for housing and finance in the six New England States. As a requirement of membership in the FHLBB, the Bank must own a minimum required amount of FHLBB stock, calculated periodically based primarily on its level of borrowings from the FHLBB. The Bank uses the FHLBB for a portion of its wholesale funding needs. As of June 30, 2025 and 2024, and December 31, 2024, the Bank's investment in FHLBB stock totaled $6,697,000, $6,073,000 and $6,166,000, respectively. FHLBB stock is a non-marketable equity security and therefore is reported at cost, which equals par value.
The Bank is also a member of the FRBB. As a requirement for membership in the FRBB, the Bank must own a minimum required amount of FRBB stock. The Bank uses FRBB for certain correspondent banking services and maintains borrowing capacity at its discount window. The Bank's investment in FRBB stock totaled $1,037,000 at June 30, 2025 and 2024, and December 31, 2024.
The Company periodically evaluates its investment in FHLBB and FRBB stock for impairment based on, among other factors, the capital adequacy of the Banks and their overall financial condition. No impairment losses have been recorded through June 30, 2025. The Bank will continue to monitor its investment in these restricted equity securities.