Note 10. Subordinated Debt

On August 20, 2025, the Company issued $100 million of 7.25% fixed-to-floating rate subordinated notes (the "2025 Notes"), which were outstanding as of December 31, 2025.

The 2025 Notes have a stated maturity of September 1, 2035, are redeemable by the Company (i) in whole or in part, on or after September 1, 2030, and (ii) in full, at any time upon the occurrence of certain events. The 2025 Notes will bear interest at a fixed rate of 7.25% per year, from and including August 20, 2025, to, but excluding September 1, 2030, or earlier redemption date. From and including September 1, 2030, to, but excluding the maturity date or early redemption date, the interest rate will reset quarterly at a variable rate equal to the then current three-month term secured overnight financing rate (“SOFR”), plus 385 basis points. As provided in the 2025 Notes, the interest rate on the 2025 Notes during the applicable floating rate period may be determined based on a rate other than three-month term SOFR.

The debt issuance costs for the 2025 Notes totaled $1.4 million and will be amortized through September 1, 2030. Unamortized debt issuance cost was $1.3 million at December 31, 2025.  Amortization expense totaled $96 thousand for the year ended December 31, 2025.

On September 28, 2018, the Company issued $40 million of 5.625% fixed-to-floating rate subordinated notes (the "Notes"), which were outstanding as of December 31, 2024. Unamortized debt issuance cost was $0 and $316 thousand at December 31, 2025, and 2024, respectively.  The unamortized debt issuance cost was written off as of September 30, 2025, and subsequently the 2018 Notes were retired on October 2, 2025.  

Amortization expense totaled $56 for the year ended December 31, 2025, and $84 thousand for each of the years ended December 31, 2024, and 2023, respectively.