Investment Securities

6 Months Ended

Jun. 30, 2025

Investment Securities

Investment Securities

Note 2— Investment Securities

Available-for-Sale

Each of the securities in the Company’s available-for-sale investment portfolio is either covered by the explicit or implied guarantee of the United States government or one of its agencies or rated investment grade or higher. All available-for-sale securities were current with no securities past due or on nonaccrual as of June 30, 2025 or December 31, 2024.

The following tables summarize the amortized cost and fair value of securities available-for-sale and the corresponding amounts of gross unrealized gains and losses at June 30, 2025 and December 31, 2024.


		June 30, 2025
					Gross			Gross
		Amortized			Unrealized			Unrealized			Fair
(Dollars in thousands)		Cost			Gains			(Losses)			Value
Available-for-sale
U.S. Treasuries		$	20,215		$	—		$	(401)		$	19,814
U.S. government and federal agencies			6,983			—			(232)			6,751
Corporate bonds			3,000			—			(223)			2,777
U.S. agency collateralized mortgage obligations			35,339			5			(5,784)			29,560
Tax-exempt municipal			1,378			—			(203)			1,175
Taxable municipal			270			—			(2)			268
U.S. agency mortgage-backed			69,141			120			(4,108)			65,153
Total Available-for-sale Securities		$	136,326		$	125		$	(10,953)		$	125,498


		December 31, 2024
					Gross			Gross
		Amortized			Unrealized			Unrealized			Fair
(Dollars in thousands)		Cost			Gains			(Losses)			Value
Available-for-sale
U.S. Treasuries		$	27,920		$	—		$	(783)		$	27,137
U.S. government and federal agencies			10,966			—			(385)			10,581
Corporate bonds			3,000			—			(261)			2,739
U.S. agency collateralized mortgage obligations			36,032			—			(6,421)			29,611
Tax-exempt municipal			1,379			—			(208)			1,171
Taxable municipal			270			—			(7)			263
U.S. agency mortgage-backed			64,274			—			(5,519)			58,755
Total Available-for-sale Securities		$	143,841		$	—		$	(13,584)		$	130,257

The Company did not sell or recognize any gain or loss for any securities for the three or six months ended June 30, 2025 and for the three or six months ended June 30, 2024.

Available-for-sale securities having a market value of $51.9 million and $48.8 million at June 30, 2025 and December 31, 2024, respectively, were pledged to secure public deposits. These securities had an amortized cost of $55.9 million and $52.5 million at June 30, 2025 and December 31, 2024, respectively.

The following tables summarize the fair value of securities available-for-sale at June 30, 2025 and December 31, 2024 and the corresponding amounts of gross unrealized losses. Management uses the valuations as of month-end in determining when securities are

in an unrealized loss position. Therefore, a security’s market value could have exceeded its amortized cost on other days during the prior twelve-month period.


		June 30, 2025
		Less than 12 Months						12 Months or Longer						Total
					Gross						Gross						Gross
		Fair			Unrealized			Fair			Unrealized			Fair			Unrealized
(Dollars in thousands)		Value			Losses			Value			Losses			Value			Losses
Available-for-sale
U.S. Treasuries		$	—		$	—		$	19,814		$	(401)		$	19,814		$	(401)
U.S. government and federal agencies			—			—			6,751			(232)			6,751			(232)
Corporate bonds			—			—			2,777			(223)			2,777			(223)
U.S. agency collateralized mortgage obligations			—			—			28,679			(5,784)			28,679			(5,784)
Tax-exempt municipal			—			—			1,175			(203)			1,175			(203)
Taxable municipal			—			—			268			(2)			268			(2)
U.S. agency mortgage-backed			—			—			52,469			(4,108)			52,469			(4,108)
Total Available-for-sale Securities		$	—		$	—		$	111,933		$	(10,953)		$	111,933		$	(10,953)


		December 31, 2024
		Less than 12 Months						12 Months or Longer						Total
					Gross						Gross						Gross
		Fair			Unrealized			Fair			Unrealized			Fair			Unrealized
(Dollars in thousands)		Value			Losses			Value			Losses			Value			Losses
Available-for-sale
U.S. Treasuries		$	—		$	—		$	27,137		$	(783)		$	27,137		$	(783)
U.S. government and federal agencies			—			—			10,581			(385)			10,581			(385)
Corporate bonds			—			—			2,739			(261)			2,739			(261)
U.S. agency collateralized mortgage obligations			—			—			29,611			(6,421)			29,611			(6,421)
Tax-exempt municipal			—			—			1,171			(208)			1,171			(208)
Taxable municipal			—			—			263			(7)			263			(7)
U.S. agency mortgage-backed			—			—			58,755			(5,519)			58,755			(5,519)
Total Available-for-sale Securities		$	—		$	—		$	130,257		$	(13,584)		$	130,257		$	(13,584)

The Company had 140 and 147 securities in an unrealized loss position for 12 months or longer as of June 30, 2025 and December 31, 2024, respectively. The Company has evaluated available-for-sale securities in an unrealized loss position for credit related impairment at June 30, 2025 and December 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 issuer(s) 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 and the accounting standard of “more likely than not” has not been met for the Company to be required to sell any of the investments before recovery of its amortized cost basis. As such, there was no allowance for credit losses on available-for-sale securities at June 30, 2025.

The table below summarizes the contractual maturities of our available-for-sale investment securities as of June 30, 2025. Issuers may have the right to call or prepay certain obligations, and as such, the expected maturities of our securities may occur sooner than the scheduled contractual maturities presented below.


		June 30, 2025
		Amortized			Fair
(Dollars in thousands)		Cost			Value
Available-for-sale
Due in one year or less		$	27,446		$	26,987
Due after one year through five years			12,387			12,042
Due after five years through ten years			42,405			41,146
Due after ten years			54,088			45,323
Total Available-for-sale Securities		$	136,326		$	125,498

In the prevailing rate environments as of both June 30, 2025 and December 31, 2024, the Company’s available-for-sale investment portfolio had an estimated weighted average remaining life of approximately 3.1 years in each instance.

Held-to-Maturity

Each of the securities in the Company’s held-to-maturity investment portfolio is either covered by the explicit or implied guarantee of the United States government or one of its agencies or rated investment grade or higher. All held-to-maturity securities were current with no securities past due or on nonaccrual as of June 30, 2025 or December 31, 2024.

The following tables summarize the amortized cost and fair value of securities held-to-maturity and the corresponding amounts of gross unrealized losses at June 30, 2025 and December 31, 2024, respectively.


		June 30, 2025
					Gross			Gross
		Amortized			Unrealized			Unrealized			Fair
(Dollars in thousands)		Cost			Gains			(Losses)			Value
Held-to-maturity
U.S. Treasuries		$	6,002		$	—		$	(410)		$	5,592
U.S. government and federal agencies			35,332			—			(3,594)			31,738
U.S. agency collateralized mortgage obligations			17,013			—			(3,420)			13,593
Taxable municipal			6,032			—			(872)			5,160
U.S. agency mortgage-backed			25,885			—			(4,520)			21,365
Total Held-to-maturity Securities		$	90,264		$	—		$	(12,816)		$	77,448


		December 31, 2024
					Gross			Gross
		Amortized			Unrealized			Unrealized			Fair
(Dollars in thousands)		Cost			Gains			(Losses)			Value
Held-to-maturity
U.S. Treasuries		$	6,001		$	—		$	(583)		$	5,418
U.S. government and federal agencies			35,349			—			(4,743)			30,606
U.S. agency collateralized mortgage obligations			17,805			—			(3,948)			13,857
Taxable municipal			6,041			—			(1,089)			4,952
U.S. agency mortgage-backed			26,813			—			(5,376)			21,437
Total Held-to-maturity Securities		$	92,009		$	—		$	(15,739)		$	76,270

Held-to-maturity securities having a market value of $45.7 million and $43.0 million at June 30, 2025 and December 31, 2024, respectively, were pledged to secure public deposits. These securities had an amortized cost of $51.3 million and $50.0 million at June 30, 2025 and December 31, 2024, respectively.

The Company evaluates the credit risk of its held-to-maturity securities on at least a quarterly basis. The Company estimates expected credit losses on held-to-maturity securities on an individual basis based on a probability of default/loss given default methodology primarily using security-level credit ratings. The primary indicators of credit quality for the Company’s held-to-maturity portfolio are security type and credit rating, which is influenced by a number of factors including obligor cash flow, geography, seniority, and others. The Company’s held-to-maturity securities with credit risk were comprised of municipal bonds and had a credit rating of AA or better as of June 30, 2025. All other held-to-maturity securities are covered by the explicit or implied guarantee of the United States government or one of its agencies. The Company did not have an allowance for credit losses on held-to-maturity securities as of June 30, 2025 or December 31, 2024.

The table below summarizes the contractual maturities of our held-to-maturity investment securities as of June 30, 2025. Issuers may have the right to call or prepay certain obligations and as such, the expected maturities of our securities are likely to occur sooner than the scheduled contractual maturities presented below.


		June 30, 2025
		Amortized			Fair
(Dollars in thousands)		Cost			Value
Held-to-maturity
Due in one year or less		$	—		$	—
Due after one year through five years			32,499			29,923
Due after five years through ten years			17,514			15,068
Due after ten years			40,251			32,457
Total Held-to-maturity Securities		$	90,264		$	77,448

In the prevailing rate environments as of June 30, 2025 and December 31, 2024, the Company’s held-to-maturity investment portfolio had an estimated weighted average remaining life of approximately 5.6 years and 6.0 years, respectively.

Restricted Securities

The table below summarizes the carrying amount of restricted securities as of June 30, 2025 and December 31, 2024.


(Dollars in thousands)		June 30, 2025			December 31, 2024
Federal Reserve Bank Stock		$	3,335		$	3,327
Federal Home Loan Bank Stock			4,242			4,247
Community Bankers’ Bank Stock			60			60
Total Restricted Securities		$	7,637		$	7,634

Equity Securities

The Company held equity securities with readily determinable fair values totaling $3.1 million and $2.8 million at June 30, 2025 and December 31, 2024, respectively. These securities consist of mutual funds held in a trust and were obtained for the purpose of economically hedging changes in the Company’s nonqualified deferred compensation liability. Changes in the fair value of these securities are reflected in earnings. Gains of $182 thousand and $35 thousand were recorded in non-interest income in the Consolidated Statements of Income for the three months ended June 30, 2025 and June 30, 2024, respectively. Gains of $206 thousand and $159 thousand were recorded in non-interest income in the Consolidated Statements of Income for the six months ended June 30, 2025 and June 30, 2024, respectively.