| Investment Securities |
4. Investment Securities The following table shows a comparison of amortized cost and fair values of investment securities at December 31, 2025 and 2024: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (in thousands) | | Amortized
Cost | | Gross
Unrealized
Gains | | Gross
Unrealized
Losses | | Allowance for Credit Losses | | Estimated Fair Value | December 31, 2025 | | | | | | | | | | | | | | | | Available for Sale: | | | | | | | | | | | | | | | | U.S. government agencies | | $ | 2,000 | | $ | — | | $ | 596 | | $ | — | | $ | 1,404 | Residential mortgage-backed agencies | | | 25,891 | | | 40 | | | 3,076 | | | — | | | 22,855 | Commercial mortgage-backed agencies | | | 37,805 | | | 1 | | | 7,738 | | | — | | | 30,068 | Collateralized mortgage obligations | | | 29,795 | | | 40 | | | 2,445 | | | — | | | 27,390 | Obligations of states and political subdivisions | | | 8,557 | | | 35 | | | 67 | | | — | | | 8,525 | Corporate bonds | | | 1,000 | | | — | | | 93 | | | — | | | 907 | Collateralized debt obligations | | | 18,802 | | | — | | | 2,807 | | | — | | | 15,995 | Total available for sale | | $ | 123,850 | | $ | 116 | | $ | 16,822 | | $ | — | | $ | 107,144 | | | | | | | | | | | | | | | | | (in thousands) | | Amortized
Cost | | Gross
Unrecognized
Gains | | Gross
Unrecognized
Losses | | Estimated Fair Value | | Allowance for Credit Losses | December 31, 2025 | | | | | | | | | | | | | | | | Held to Maturity: | | | | | | | | | | | | | | | | U.S. government agencies | | $ | 68,595 | | $ | — | | $ | 7,721 | | $ | 60,874 | | $ | — | Residential mortgage-backed agencies | | | 32,084 | | | 138 | | | 2,474 | | | 29,748 | | | — | Commercial mortgage-backed agencies | | | 20,947 | | | — | | | 5,180 | | | 15,767 | | | — | Collateralized mortgage obligations | | | 45,447 | | | — | | | 7,056 | | | 38,391 | | | — | Obligations of states and political subdivisions | | | 4,390 | | | 206 | | | 487 | | | 4,109 | | | 102 | Total held to maturity | | $ | 171,463 | | $ | 344 | | $ | 22,918 | | $ | 148,889 | | $ | 102 |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (in thousands) | | Amortized
Cost | | Gross
Unrealized
Gains | | Gross
Unrealized
Losses | | Allowance for Credit Losses | | Estimated Fair Value | December 31, 2024 | | | | | | | | | | | | | | | | Available for Sale: | | | | | | | | | | | | | | | | U.S. government agencies | | $ | 7,000 | | $ | — | | $ | 885 | | $ | — | | $ | 6,115 | Residential mortgage-backed agencies | | | 24,621 | | | — | | | 4,425 | | | — | | | 20,196 | Commercial mortgage-backed agencies | | | 37,205 | | | — | | | 8,571 | | | — | | | 28,634 | Collateralized mortgage obligations | | | 21,069 | | | — | | | 3,343 | | | — | | | 17,726 | Obligations of states and political subdivisions | | | 6,533 | | | — | | | 324 | | | — | | | 6,209 | Corporate bonds | | | 1,000 | | | — | | | 104 | | | — | | | 896 | Collateralized debt obligations | | | 18,686 | | | — | | | 3,968 | | | — | | | 14,718 | Total available for sale | | $ | 116,114 | | $ | — | | $ | 21,620 | | $ | — | | $ | 94,494 | | | | | | | | | | | | | | | | | (in thousands) | | Amortized
Cost | | Gross
Unrecognized
Gains | | Gross
Unrecognized
Losses | | Estimated Fair Value | | Allowance for Credit Losses | December 31, 2024 | | | | | | | | | | | | | | | | Held to Maturity: | | | | | | | | | | | | | | | | U.S. government agencies | | $ | 68,301 | | $ | — | | $ | 11,192 | | $ | 57,109 | | $ | — | Residential mortgage-backed agencies | | | 32,171 | | | 1 | | | 3,561 | | | 28,611 | | | — | Commercial mortgage-backed agencies | | | 21,134 | | | — | | | 5,794 | | | 15,340 | | | — | Collateralized mortgage obligations | | | 49,439 | | | — | | | 9,724 | | | 39,715 | | | — | Obligations of states and political subdivisions | | | 4,511 | | | 177 | | | 703 | | | 3,985 | | | 59 | Total held to maturity | | $ | 175,556 | | $ | 178 | | $ | 30,974 | | $ | 144,760 | | $ | 59 |
Proceeds from sales and calls of AFS securities and the realized gains and losses for the years ended December 31, 2025 and 2024 are as follows: | | | | | | | | | | | | | | (in thousands) | | 2025 | | 2024 | Proceeds | | $ | 8,965 | | $ | — | Gross realized gains | | | 203 | | | — | Gross realized losses | | | (106) | | | — |
The Corporation’s AFS security portfolio includes securities with a fair value of $90.6 million and $93.3 million, respectively, which had unrealized losses of $16.8 million and $21.6 million at December 31, 2025 and 2024, respectively. The Corporation does not have the intent to sell these securities, and it is likely that it will not be required to sell these securities before their anticipated recoveries. The following table shows the Corporation’s securities with gross unrealized and unrecognized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized position, at December 31, 2025 and 2024: | | | | | | | | | | | | | | | | | | | Less than 12 months | | 12 months or more | (in thousands) | | Fair
Value | | Unrealized
Losses | | Number of
Investments | | Fair
Value | | Unrealized
Losses | | Number of
Investments | December 31, 2025 | | | | | | | | | | | | | | | | | Available for Sale: | | | | | | | | | | | | | | | | | U.S. government agencies | | $ | — | | $ | — | | — | | $ | 1,404 | | $ | 596 | | 1 | Residential mortgage-backed agencies | | | — | | | — | | — | | | 17,405 | | | 3,076 | | 3 | Commercial mortgage-backed agencies | | | — | | | — | | — | | | 28,623 | | | 7,738 | | 9 | Collateralized mortgage obligations | | | 8,811 | | | 100 | | 1 | | | 14,160 | | | 2,345 | | 9 | Obligations of states and political subdivisions | | | — | | | — | | — | | | 3,332 | | | 67 | | 2 | Corporate Bonds | | | — | | | — | | — | | | 907 | | | 93 | | 1 | Collateralized debt obligations | | | — | | | — | | — | | | 15,995 | | | 2,807 | | 9 | Total available for sale | | $ | 8,811 | | $ | 100 | | 1 | | $ | 81,826 | | $ | 16,722 | | 34 | | | | | | | | | | | | | | | | | | | | Less than 12 months | | 12 months or more | (in thousands) | | Fair
Value | | Unrecognized
Losses | | Number of
Investments | | Fair
Value | | Unrecognized
Losses | | Number of
Investments | December 31, 2025 | | | | | | | | | | | | | | | | | Held to Maturity: | | | | | | | | | | | | | | | | | U.S. government agencies | | $ | — | | $ | — | | — | | $ | 60,874 | | $ | 7,721 | | 9 | Residential mortgage-backed agencies | | | — | | | — | | — | | | 19,434 | | | 2,474 | | 35 | Commercial mortgage-backed agencies | | | — | | | — | | — | | | 15,767 | | | 5,180 | | 2 | Collateralized mortgage obligations | | | — | | | — | | — | | | 38,391 | | | 7,056 | | 8 | Obligations of states and political subdivisions | | | — | | | — | | — | | | 2,364 | | | 487 | | 1 | Total held to maturity | | $ | — | | $ | — | | — | | $ | 136,830 | | $ | 22,918 | | 55 |
| | | | | | | | | | | | | | | | | | | Less than 12 months | | 12 months or more | (in thousands) | | Fair
Value | | Unrealized
Losses | | Number of
Investments | | Fair
Value | | Unrealized
Losses | | Number of
Investments | December 31, 2024 | | | | | | | | | | | | | | | | | Available for Sale: | | | | | | | | | | | | | | | | | U.S. government agencies | | $ | — | | $ | — | | — | | $ | 6,115 | | $ | 885 | | 2 | Residential mortgage-backed agencies | | | 1,974 | | | 18 | | 1 | | | 18,222 | | | 4,407 | | 3 | Commercial mortgage-backed agencies | | | 1,688 | | | 59 | | 1 | | | 26,946 | | | 8,512 | | 8 | Collateralized mortgage obligations | | | 2,892 | | | 50 | | 1 | | | 14,834 | | | 3,293 | | 9 | Obligations of states and political subdivisions | | | 1,224 | | | 18 | | 2 | | | 3,742 | | | 306 | | 3 | Corporate Bonds | | | — | | | — | | — | | | 896 | | | 104 | | 1 | Collateralized debt obligations | | | — | | | — | | — | | | 14,718 | | | 3,968 | | 9 | Total available for sale | | $ | 7,778 | | $ | 145 | | 5 | | $ | 85,473 | | $ | 21,475 | | 35 | | | | | | | | | | | | | | | | | | | | Less than 12 months | | 12 months or more | (in thousands) | | Fair
Value | | Unrecognized
Losses | | Number of
Investments | | Fair
Value | | Unrecognized
Losses | | Number of
Investments | December 31, 2024 | | | | | | | | | | | | | | | | | Held to Maturity: | | | | | | | | | | | | | | | | | U.S. government agencies | | $ | — | | $ | — | | — | | $ | 57,109 | | $ | 11,192 | | 9 | Residential mortgage-backed agencies | | | 8,291 | | | 132 | | 5 | | | 20,243 | | | 3,429 | | 35 | Commercial mortgage-backed agencies | | | — | | | — | | — | | | 15,340 | | | 5,794 | | 2 | Collateralized mortgage obligations | | | — | | | — | | — | | | 39,715 | | | 9,724 | | 8 | Obligations of states and political subdivisions | | | — | | | — | | — | | | 2,179 | | | 703 | | 1 | Total held to maturity | | $ | 8,291 | | $ | 132 | | 5 | | $ | 134,586 | | $ | 30,842 | | 55 |
At December 31, 2025 and December 31, 2024, the Corporation recorded ACL of approximately $102,000 and $59,000, respectively, related to one bond in the HTM security portfolio. The amortized cost and estimated fair value of securities by contractual maturity at December 31, 2025 are shown in the following table. Actual maturities will differ from contractual maturities because the issuers of the securities may have the right to call or prepay obligations with or without call or prepayment penalties. | | | | | | | | | | | | | | (in thousands) | | Amortized
Cost | | Fair
Value | Contractual Maturity | | | | | | | Available for sale: | | | | | | | Due after one year through five years | | $ | 250 | | $ | 250 | Due after five years through ten years | | | 16,680 | | | 14,751 | Due after ten years | | | 13,429 | | | 11,830 | | | | 30,359 | | | 26,831 | Residential mortgage-backed agencies | | | 25,891 | | | 22,855 | Commercial mortgage-backed agencies | | | 37,805 | | | 30,068 | Collateralized mortgage obligations | | | 29,795 | | | 27,390 | Total available for sale | | $ | 123,850 | | $ | 107,144 | Held to Maturity: | | | | | | | Due after one year through five years | | $ | 17,050 | | $ | 16,640 | Due after five years through ten years | | | 45,393 | | | 40,147 | Due after ten years | | | 10,542 | | | 8,196 | | | | 72,985 | | | 64,983 | Residential mortgage-backed agencies | | | 32,084 | | | 29,748 | Commercial mortgage-backed agencies | | | 20,947 | | | 15,767 | Collateralized mortgage obligations | | | 45,447 | | | 38,391 | Total held to maturity | | $ | 171,463 | | $ | 148,889 | | | | | | | |
At December 31, 2025 and 2024, AFS investment securities with a fair value of $87.1 million and $71.6 million, respectively, and HTM investment securities with a book value of $169.0 million and $161.2 million, respectively, were pledged as permitted or required to secure public deposits, for securities sold under agreements to repurchase as required or permitted by law and as collateral for borrowing capacity.
|