SECURITIES

3 Months Ended

Mar. 31, 2026

3. SECURITIES

Securities available for sale are summarized as follows as of the dates presented below (dollars in thousands):

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Allowance for Credit Losses		Fair Value
March 31, 2026
Available for sale:
U.S government and agencies	$	49,990	$	—	$	—		$	—	$	49,990
State and municipal		198,274		269		(25,346	)		—		173,197
Residential mortgage-backed securities		295,057		91		(41,083	)		—		254,065
Commercial mortgage-backed securities		49,924		—		(4,091	)		—		45,833
Commercial collateralized mortgage obligations		67,206		39		(178	)		—		67,067
Asset-backed and other amortizing securities		13,550		—		(850	)		—		12,700
Other securities		—		—		—			—		—
	$	674,001	$	399	$	(71,548	)	$	—	$	602,852

December 31, 2025
Available for sale:
State and municipal	$	199,417	$	388	$	(23,500	)	$	—	$	176,305
Residential mortgage-backed securities		302,711		130		(42,081	)		—		260,760
Commercial mortgage-backed securities		48,769		—		(3,983	)		—		44,786
Commercial collateralized mortgage obligations		67,708		77		(188	)		—		67,597
Asset-backed and other amortizing securities		13,972		—		(840	)		—		13,132
Other securities		5,000		—		(40	)		—		4,960
	$	637,577	$	595	$	(70,632	)	$	—	$	567,540

The amortized cost and estimated fair value of securities at March 31, 2026 are presented below by contractual maturity (dollars in thousands). Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations. Declining-balance securities are shown separately since they are not due at a single maturity date.

	Available for Sale
	Amortized Cost		Fair Value
Within 1 year	$	49,990	$	49,990
After 1 year through 5 years		5,072		5,015
After 5 years through 10 years		13,909		13,067
After 10 years		179,293		155,115
Declining-balance securities		425,737		379,665
	$	674,001	$	602,852

At both March 31, 2026 and December 31, 2025, there were no holdings of securities of any one issuer, other than the U.S. government, its agencies, or its sponsored enterprises, in an amount greater than 10% of stockholders’ equity.

Securities with a carrying value of approximately $469.7 million and $413.7 million at March 31, 2026 and December 31, 2025, respectively, were pledged to collateralize public deposits and for other purposes as required or permitted by law.

The following table segregates securities with unrealized losses at the dates indicated, by the duration they have been in a loss position for which an allowance for credit losses has not been recorded (dollars in thousands):

	Less than 12 Months				12 Months or More				Total
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
March 31, 2026
State and municipal	$	277	$	2	$	162,047	$	25,344	$	162,324	$	25,346
Residential mortgage-backed securities		3,055		77		243,723		41,006		246,778		41,083
Commercial mortgage-backed securities		4,954		56		40,879		4,035		45,833		4,091
Commercial collateralized mortgage obligations		62,956		178		—		—		62,956		178
Asset-backed and other amortizing securities		—		—		12,700		850		12,700		850
Other securities		—		—		—		—		—		—
	$	71,242	$	313	$	459,349	$	71,235	$	530,591	$	71,548

December 31, 2025
State and municipal	$	205	$	—	$	165,618	$	23,500	$	165,823	$	23,500
Residential mortgage-backed securities		3,132		48		249,710		42,033		252,842		42,081
Commercial mortgage-backed securities		3,503		7		41,284		3,976		44,787		3,983
Commercial collateralized mortgage obligations		63,210		188		—		—		63,210		188
Asset-backed and other amortizing securities		—		—		13,132		840		13,132		840
Other securities		—		—		4,961		40		4,961		40
	$	70,050	$	243	$	474,705	$	70,389	$	544,755	$	70,632

There were 128 securities with an unrealized loss at March 31, 2026, generally due to a continuation of the elevated market interest rate environment. Management evaluates securities available for sale (“AFS”) in unrealized loss positions to determine whether the impairment is due to credit-related factors or non-credit related factors. Consideration is given to the extent to which the fair value is less than cost, the financial condition and near-term prospects of the issuer, and the intent and ability of the Company to retain its investment in the security for a period of time sufficient to allow for the anticipated recovery in fair value. Management does not have the intent to sell any of the securities in an unrealized loss position and believes that it is not likely that the securities will have to be sold before a recovery of cost. The fair value of these securities is expected to recover as the securities approach their maturity date or repricing date or if market yields for such investments decline. Accordingly, as of March 31, 2026, management believes the unrealized loss positions detailed in the previous table are due to non-credit related factors, including changes in interest rates and other market conditions, and therefore no ACL for AFS securities or losses have been recognized or realized in the consolidated financial statements.