Note 3 - Securities

6 Months Ended

Jun. 30, 2025

Notes to Financial Statements

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

NOTE 3 – SECURITIES

Equity Securities

The Company held equity securities with fair values of $3,292,000 and $3,169,000 as of June 30, 2025 and December 31, 2024, respectively. There were no sales of equity securities during the three and six-month periods ended June 30, 2025 and 2024. Consistent with ASC 321, Equity Securities, these securities are carried at fair value with the changes in fair value recognized in the condensed consolidated statements of income. Accordingly, the Company recognized gains of $4,000 and $64,000 during the three and six-month periods ended June 30, 2025, respectively, as compared to losses of $24,000 and $81,000 during the same periods of 2024.

Debt Securities

Debt securities have been classified in the financial statements as available for sale. The amortized cost and estimated fair values of debt securities as of June 30, 2025 are as follows:

(dollars in thousands)		Amortized Cost				Gross Unrealized Gains				Gross Unrealized Losses				Fair Value
Available-for-sale securities:
U.S. agencies		$	85,244			$	39			$	(4,293	)		$	80,990
Collateralized mortgage obligations			26,052				112				(437	)			25,727
Municipalities			346,153				319				(35,881	)			310,591
SBA pools			765				1				(3	)			763
Corporate debt			43,500				12				(1,787	)			41,725
Asset backed securities			44,089				71				(609	)			43,551
		$	545,803			$	554			$	(43,010	)		$	503,347

The following table details the gross unrealized losses and fair values of debt securities aggregated by investment category and the length of time that individual securities have been in a continuous unrealized loss position as of June 30, 2025.

(dollars in thousands)						Less than 12 months								12 months or more								Total
Description of Securities		Number of Securities				Fair Value				Unrealized Loss				Fair Value				Unrealized Loss				Fair Value				Unrealized Loss
U.S. agencies			37			$	7,862			$	(331	)		$	54,463			$	(3,962	)		$	62,325			$	(4,293	)
Collateralized mortgage obligations			7				10,445				(75	)			6,582				(362	)			17,027				(437	)
Municipalities			126				113,844				(6,988	)			177,945				(28,893	)			291,789				(35,881	)
SBA pools			4				415				(1	)			133				(2	)			548				(3	)
Corporate debt			11				0				0				39,713				(1,787	)			39,713				(1,787	)
Asset backed securities			15				9,792				(54	)			14,286				(555	)			24,079				(609	)
Total temporarily impaired securities			200			$	142,358			$	(7,449	)		$	293,122			$	(35,561	)		$	435,481			$	(43,010	)

For available-for-sale debt securities in an unrealized loss position, management evaluates whether the decline in fair value is a reflection of credit deterioration or other factors. In performing this evaluation, management considers the extent which fair value has fallen below amortized cost, changes in ratings by rating agencies, and other information indicating a deterioration in repayment capacity of either the underlying issuer or the borrowers providing repayment capacity in a securitization. If management’s evaluation indicates that a credit loss exists then a present value of the expected cash flows is calculated and compared to the amortized cost basis of the security in question and, to the degree that the amortized cost basis exceeds the present value, an allowance for credit loss (“ACL”) is established, with the caveat that the maximum amount of the reserve on any individual security is the difference between the fair value and amortized cost balance of the security in question. Any unrealized loss that has not been recorded through an ACL is recognized in other comprehensive income. Accrued interest receivable on available-for-sale securities was $5,071,000 and $4,888,000 as of June 30, 2025 and December 31, 2024, respectively, and is not included in the tables within this footnote.

The unrealized losses are due primarily to rising market yields and not due to credit deterioration. As such, no ACL on available-for-sale securities has been established as of June 30, 2025 and December 31, 2024. The Company does not intend to sell the securities and it is not likely that the Company will be required to sell the securities before the earlier of the forecasted recovery or the maturity of the underlying investment security.

The amortized cost and estimated fair value of debt securities as of June 30, 2025, segregated by contractual maturity or call date, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

(dollars in thousands)		Amortized				Fair
		Cost				Value
Available-for-sale securities:
Due in one year or less		$	87,268			$	84,648
Due after one year through five years			166,369				151,794
Due after five years through ten years			178,922				158,310
Due after ten years			26,948				26,256
Subtotal			459,507				421,008
Mortgage-backed securities and collateralized mortgage obligations			86,296				82,339
Total		$	545,803			$	503,347

The amortized cost and estimated fair values of debt securities as of December 31, 2024 are as follows:

(dollars in thousands)		Amortized Cost				Gross Unrealized Gains				Gross Unrealized Losses				Fair Value
Available-for-sale securities:
U.S. agencies		$	92,659			$	20			$	(5,605	)		$	87,074
Collateralized mortgage obligations			29,105				0				(606	)			28,499
Municipalities			347,051				900				(25,459	)			322,492
SBA pools			882				0				(3	)			879
Corporate debt			43,500				6				(2,294	)			41,212
Asset backed securities			46,946				66				(672	)			46,340
		$	560,143			$	992			$	(34,639	)		$	526,496

The following tables detail the gross unrealized losses and fair values aggregated of debt securities by investment category and length of time that individual securities have been in a continuous unrealized loss position at December 31, 2024.

(dollars in thousands)						Less than 12 months								12 months or more								Total
Description of Securities		Number of Securities				Fair Value				Unrealized Loss				Fair Value				Unrealized Loss				Fair Value				Unrealized Loss
U.S. agencies			45			$	29,489			$	(777	)		$	54,568			$	(4,828	)		$	84,057			$	(5,605	)
Collateralized mortgage obligations			9				25,092				(189	)			3,408				(417	)			28,500				(606	)
Municipalities			123				113,936				(2,280	)			179,223				(23,179	)			293,159				(25,459	)
SBA pools			6				720				(1	)			159				(2	)			879				(3	)
Corporate debt			11				0				0				39,206				(2,294	)			39,206				(2,294	)
Asset backed securities			13				7,948				(15	)			15,912				(657	)			23,860				(672	)
			207			$	177,185			$	(3,262	)		$	292,476			$	(31,377	)		$	469,661			$	(34,639	)

There were no sales of available-for-sale securities during the three and six-months ended June 30, 2025. There were 17 available-for-sale securities sold during the three-months ended June 30, 2024 with a book value of $26,300,000, resulting in gross gains of $25,000, and 18 available-for-sale securities sold during the six-months ended June 30, 2024 with a book value of $28,258,000, resulting in gross gains of $105,000. In addition, the Company recognized a gain of $2,000 on called securities during the three and six-month periods ended June 30, 2025, as compared to losses of $1,000 and $9,000 during the comparable 2024 periods, respectively.

Debt securities carried at $301,282,000 and $288,199,000 as of June 30, 2025 and December 31, 2024, respectively, were pledged to secure deposits of public funds.