v3.25.2
Derivatives and Hedging Activities
 6 Months Ended
Jun. 30, 2025
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivatives and Hedging Activities Derivatives and Hedging Activities
Risk Management Objective of Using Derivatives
The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company primarily uses interest rate swaps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. Such derivatives were used to hedge the variable cash flows associated with existing variable-rate deposits.
For derivatives designated and that qualify as cash flow hedges of interest rate risk, the gain or loss on the derivative is recorded in accumulated other comprehensive income (“OCI”) and subsequently reclassified into interest expense in the same period(s) during which the hedged transaction affects earnings. Amounts reported in accumulated OCI related to derivatives will be reclassified to interest on deposits as interest payments are made on the Company’s variable-rate deposits. During the twelve months following June 30, 2025, the Company estimates that an additional $23 thousand will be reclassified as a reduction to interest expense.
Fair Value of Derivative Instruments on the Consolidated Balance Sheets
The table below presents the notional amount, location, and fair value of the Company’s derivative financial instruments on the Consolidated Balance Sheets as of June 30, 2025 and December 31, 2024:
Derivative Liabilities 
As of June 30, 2025
($ in thousands)Notional AmountBalance Sheet LocationFair Value
Derivatives designated as hedging instruments:
Interest rate swaps$80,000 Other liabilities$4 
Total$4 
Derivative Assets 
As of December 31, 2024
($ in thousands)Notional AmountBalance Sheet LocationFair Value
Derivatives designated as hedging instruments:
Interest rate swaps$80,000  Other assets $509 
Total$509 
Effect of Cash Flow Hedge Accounting on Accumulated Other Comprehensive Income
The table below presents the pre-tax effect of cash flow hedge accounting on accumulated other comprehensive income for the three and six months ended June 30, 2025 (in thousands):
Three Months Ended June 30, 2025
 Amount of Gain (Loss) Recognized in OCI on DerivativeLocation of Gain Recognized from Accumulated OCI into IncomeAmount of Gain Reclassified from Accumulated OCI into Income
Derivatives in Cash Flow Hedging Relationships: 
Interest rate swaps$28 Interest on deposits$112 
Total$28 $112 
Six Months Ended June 30, 2025
 Amount of Gain (Loss) Recognized in OCI on DerivativeLocation of Gain Recognized from Accumulated OCI into IncomeAmount of Gain Reclassified from Accumulated OCI into Income
Derivatives in Cash Flow Hedging Relationships: 
Interest rate swaps$(226)Interest on deposits$225 
Total$(226)$225 
Effect of Cash Flow Hedge Accounting on the Statement of Income for the Three and Six Months Ended June 30, 2025
The table below presents the effect of the Company’s derivative financial instruments on the Consolidated Statements of Income for the three and six months ended June 30, 2025 (in thousands):
Three Months Ended
June 30, 2025		Six Months Ended
June 30, 2025
 Location and Amount of Gain Recognized in Income on Cash Flow Hedging RelationshipsLocation and Amount of Gain Recognized in Income on Cash Flow Hedging Relationships
Location of gain recognized in incomeInterest on depositsInterest on deposits
Total amounts of income and expense line items presented in the statement of financial performance in which the effects of cash flow hedges are recorded$112 $225 
The effects of cash flow hedging:
Interest rate swaps:
Amount of gain reclassified from accumulated OCI into income$112 $225 
Offsetting Derivative Assets and Liabilities
The tables below present a gross presentation, the effects of offsetting, and a net presentation of the Company’s derivatives as of June 30, 2025 and December 31, 2024. The net amounts of derivative assets and liabilities can be reconciled to the tabular disclosure of fair value. The tabular disclosure of fair value provides the location that derivative assets and liabilities are presented on the consolidated balance sheets.
As of June 30, 2025
Gross Amounts Not Offset in the Statement of Financial Position
($ in thousands)Gross Amounts of Recognized LiabilitiesGross Amounts Offset in the Statement of Financial PositionNet Amounts of Liabilities presented in the Statement of Financial PositionFinancial InstrumentsCash Collateral ReceivedNet Amount
Liabilities:
Interest rate swaps$4 $— $4 $— $— $4 
As of December 31, 2024
Gross Amounts Not Offset in the Statement of Financial Position
($ in thousands)Gross Amounts of Recognized AssetsGross Amounts Offset in the Statement of Financial PositionNet Amounts of Assets presented in the Statement of Financial PositionFinancial InstrumentsCash Collateral ReceivedNet Amount
Assets:
Interest rate swaps$509 $— $509 $— $— $509