Note 4 - Loans Receivable and Allowance for Credit Losses

3 Months Ended

Mar. 31, 2026

Loans, Notes, Trade and Other Receivables, Excluding Allowance for Credit Losses [Text Block]

NOTE 4. LOANS AND ALLOWANCE FOR CREDIT LOSSES ON LOANS

At March 31, 2026 and December 31, 2025, the Company had $2.04 billion and $2.04 billion, respectively, in loans receivable outstanding. Outstanding balances include $0.05 million and $0.03 million at March 31, 2026 and December 31, 2025, respectively, for net deferred loan costs, and unamortized discounts.

The portfolio segments of loans receivable at March 31, 2026 and December 31, 2025, consist of the following:

	March 31, 2026			December 31, 2025
	(Dollars in thousands)
Commercial and Industrial	$	39,817		$	38,672
Construction		217,805			212,307
Real Estate Mortgage:
Commercial – Owner Occupied		184,691			182,529
Commercial – Non-owner Occupied		476,983			478,295
Residential – 1 to 4 Family		430,464			451,463
Residential – 1 to 4 Family Investment		479,098			494,228
Residential – Multifamily		210,577			173,611
Consumer		3,861			4,122
Total Loan receivable		2,043,296			2,035,227
Allowance for credit losses on loans		(34,921	)		(34,649	)
Total loan receivable, net of allowance for credit losses on loans	$	2,008,375		$	2,000,578

An age analysis of past due loans by class at March 31, 2026 and December 31, 2025 is as follows:

	30-59		60-89		Greater
	Days Past		Days Past		than 90		Total				Total
March 31, 2026	Due		Due		Days		Past Due		Current		Loans
	(Dollars in Thousands)
Commercial and Industrial	$	—	$	—	$	680	$	680	$	39,137	$	39,817
Construction		—		—		1,091		1,091		216,714		217,805
Real Estate Mortgage:
Commercial – Owner Occupied		—		—		400		400		184,291		184,691
Commercial – Non-owner Occupied		—		—		3,163		3,163		473,820		476,983
Residential – 1 to 4 Family		1,989		242		2,494		4,725		425,739		430,464
Residential – 1 to 4 Family Investment		1,507		118		1,437		3,062		476,036		479,098
Residential – Multifamily		—		—		—		—		210,577		210,577
Consumer		24		—		141		165		3,696		3,861
Total Loans	$	3,520	$	360	$	9,406	$	13,286	$	2,030,010	$	2,043,296

	30-59		60-89		Greater
	Days Past		Days Past		than 90		Total				Total
December 31, 2025	Due		Due		Days		Past Due		Current		Loans
	(Dollars in thousands)
Commercial and Industrial	$	—	$	—	$	688	$	688	$	37,984	$	38,672
Construction		—		—		1,091		1,091		211,216		212,307
Real Estate Mortgage:
Commercial – Owner Occupied		—		—		400		400		182,129		182,529
Commercial – Non-owner Occupied		—		1,122		3,668		4,790		473,505		478,295
Residential – 1 to 4 Family		—		1,434		2,965		4,399		447,064		451,463
Residential – 1 to 4 Family Investment		—		896		1,840		2,736		491,492		494,228
Residential – Multifamily		—		—		—		—		173,611		173,611
Consumer		—		32		141		173		3,949		4,122
Total Loans	$	—	$	3,484	$	10,793	$	14,277	$	2,020,950	$	2,035,227

The following table provides the amortized cost of loans on nonaccrual status:

	March 31, 2026
							Loans Past Due
	Nonaccrual		Nonaccrual		Total		Over 90 Days		Total
(amounts in thousands)	with no ACL		with ACL		Nonaccrual		Still Accruing		Nonperforming
Commercial and Industrial	$	—	$	680	$	680	$	—	$	680
Construction		1,091		—		1,091		—		1,091
Commercial - Owner Occupied		400		—		400		—		400
Commercial - Non-owner Occupied		243		2,920		3,163		—		3,163
Residential - 1 to 4 Family		2,296		198		2,494		—		2,494
Residential - 1 to 4 Family Investment		1,437		—		1,437		—		1,437
Residential - Multifamily		—		—		—		—		—
Consumer		141		—		141		—		141
Total	$	5,608	$	3,798	$	9,406	$	—	$	9,406

	December 31, 2025
							Loans Past Due
	Nonaccrual		Nonaccrual		Total		Over 90 Days		Total
(amounts in thousands)	with no ACL		with ACL		Nonaccrual		Still Accruing		Nonperforming
Commercial and Industrial	$	—	$	688	$	688	$	—	$	688
Construction		1,091		—		1,091		—		1,091
Commercial - Owner Occupied		400		—		400		—		400
Commercial - Non-owner Occupied		1,109		2,559		3,668		—		3,668
Residential - 1 to 4 Family		2,965		—		2,965		—		2,965
Residential - 1 to 4 Family Investment		1,840		—		1,840		—		1,840
Residential - Multifamily		—		—		—		—		—
Consumer		141		—		141		—		141
Total	$	7,546	$	3,247	$	10,793	$	—	$	10,793

Allowance for Credit Losses on Off-Balance Sheet Credit Exposures

The Company estimates expected credit losses over the contractual period in which the Company is exposed to credit risk via a contractual obligation to extend credit, unless that obligation is unconditionally cancellable by the Company. The allowance for credit losses on off-balance sheet credit exposures is recorded in other liabilities and is adjusted through the provision for credit loss expense. The estimate includes consideration of the likelihood that funding will occur and an estimate of expected credit losses on commitments expected to be funded over its estimated life. At March 31, 2026 and December 31, 2025, the allowance for credit losses on off-balance sheet credit exposures was $762.3 thousand and $829.1 thousand, respectively, on exposures totaling $198.0 million and $189.8 million, respectively. During the three months ended March 31, 2026 and 2025 , we recorded a recovery for credit losses of $66.8 thousand, and a provision for credit losses on off balance sheet exposures of $73.3 thousand, respectively.

Allowance for Credit Losses (ACL)

The following tables present the information regarding the allowance for credit losses for the three months ended March 31, 2026 and 2025:

						Real Estate Mortgage
						Commercial			Commercial						Residential
	Commercial					Owner			Non-owner			Residential			1 to 4 Family		Residential
	and Industrial		Construction			Occupied			Occupied			1 to 4 Family			Investment		Multifamily		Consumer			Total
	(Dollars in thousands)
Three months ended March 31, 2026
December 31, 2025	$	1,008	$	4,032		$	2,239		$	9,661		$	8,205		$	7,601	$	1,845	$	58		$	34,649
Charge-offs		—		—			—			—			—			—		—		—			—
Recoveries		2		—			—			—			—			—		—		—			2
Provisions (benefits)		21		(137	)		(25	)		(436	)		(274	)		526		596		(2	)		269
Ending Balance at March 31, 2026	$	1,032	$	3,895		$	2,214		$	9,225		$	7,931		$	8,127	$	2,441	$	56		$	34,921

For the three months ended March 31, 2026, the increase to the Residential 1 to 4 Family Investment segment was due to an increase in the qualitative factors related to an increase in problem loans that are 30 - 89 days delinquent. The increase in the Residential Multifamily segment was due to an increase in the portfolio balance that increased the loan exposure and also caused changes to the qualitative factors related to concentration levels within the portfolio segment. The provision benefit during the three months ended March 31, 2026 to the Commercial Non-owner Occupied segment is due to a decrease in the problem loans balance that decreased the loan exposure and also caused changes to the qualitative factors related to concentration levels within the portfolio segments.

							Real Estate Mortgage
							Commercial		Commercial					Residential
	Commercial						Owner		Non-owner		Residential			1 to 4 Family		Residential
	and Industrial			Construction			Occupied		Occupied		1 to 4 Family			Investment		Multifamily			Consumer			Total
	(Dollars in thousands)
Three months ended March 31, 2025
December 31, 2024	$	1,097		$	3,037		$	1,871	$	6,300	$	9,166		$	8,832	$	2,203		$	67		$	32,573
Charge-offs		—			—			—		—		—			—		—			—			—
Recoveries		1			—			—		—		—			—		—			—			1
Provisions (benefits)		(50	)		(762	)		599		1,061		(352	)		23		(1	)		(1	)		517
Ending Balance at March 31, 2025	$	1,048		$	2,275		$	2,470	$	7,361	$	8,814		$	8,855	$	2,202		$	66		$	33,091

For the three months ended March 31, 2025, the increase to the Commercial Owner Occupied, and the Commercial Non-owner Occupied portfolio's was due to an increase in the portfolio balances that increased the loan exposure and also caused changes to the qualitative factors related to concentration levels within the portfolio segments. The provision benefit during the quarter to the Construction segment is due to a decrease in the portfolio balance that decreased the loan exposure and also caused changes to the qualitative factors related to concentration levels within the portfolio segments.

Collateral-Dependent Loans

The following table presents the collateral-dependent loans by portfolio segment and collateral type at March 31, 2026:

			Business
(amounts in thousands)	Real Estate		Assets		Other
Commercial and Industrial	$	680	$	—	$	—
Construction		1,091		—		—
Commercial - Owner Occupied		400		—		—
Commercial - Non-owner Occupied		3,163		—		—
Residential - 1 to 4 Family		2,494		—		—
Residential - 1 to 4 Family Investment		1,437		—		—
Residential - Multifamily		—		—		—
Consumer		141		—		—
Total	$	9,406	$	—	$	—

The following table presents the collateral-dependent loans by portfolio segment and collateral type at December 31, 2025:

			Business
(amounts in thousands)	Real Estate		Assets		Other
Commercial and Industrial	$	688	$	—	$	—
Construction		1,091		—		—
Commercial - Owner Occupied		400		—		—
Commercial - Non-owner Occupied		3,668		—		—
Residential - 1 to 4 Family		2,965		—		—
Residential - 1 to 4 Family Investment		1,840		—		—
Residential - Multifamily		—		—		—
Consumer		141		—		—
Total	$	10,793	$	—	$	—

Credit Quality Indicators: As part of the on-going monitoring of the credit quality of the Company's loan portfolio, management tracks certain credit quality indicators including trends related to the risk grades of loans, the level of classified loans, net charge-offs, nonperforming loans (see details above) and the general economic conditions in the region.

The Company utilizes a risk grading matrix to assign a risk grade to each of its loans. Loans are graded on a scale of 1 to 7. Grades 1 through 4 are considered “Pass”. A description of the general characteristics of the seven risk grades is as follows:

Good: Borrower exhibits the strongest overall financial condition and represents the most creditworthy profile.

Satisfactory (A): Borrower reflects a well-balanced financial condition, demonstrates a high level of creditworthiness and typically will have a strong banking relationship with the Bank.

Satisfactory (B): Borrower exhibits a balanced financial condition and does not expose the Bank to more than a normal or average overall amount of risk. Loans are considered fully collectable.

Watch List: Borrower reflects a fair financial condition, but there exists an overall greater than average risk. Risk is deemed acceptable by virtue of increased monitoring and control over borrowings. Probability of timely repayment is present.

Other Assets Especially Mentioned (OAEM): Financial condition is such that assets in this category have a potential weakness or pose unwarranted financial risk to the Bank even though the asset value is not currently individually evaluated. The asset does not currently warrant adverse classification but if not corrected could weaken and could create future increased risk exposure. Includes loans that require an increased degree of monitoring or servicing as a result of internal or external changes.

Substandard: This classification represents more severe cases of #5 (OAEM) characteristics that require increased monitoring. Assets are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. Assets are inadequately protected by the current net worth and paying capacity of the borrower or of the collateral. Asset has a well-defined weakness or weaknesses that impairs the ability to repay debt and jeopardizes the timely liquidation or realization of the collateral at the asset’s net book value.

Doubtful: Assets which have all the weaknesses inherent in those assets classified #6 (Substandard) but the risks are more severe relative to financial deterioration in capital and/or asset value; accounting/evaluation techniques may be questionable and the overall possibility for collection in full is highly improbable. Borrowers in this category require constant monitoring, are considered work-out loans and present the potential for future loss to the Bank.

The following tables provide an analysis of loans by portfolio segment based on the credit quality indicators used to determine the allowance for credit losses, as of March 31, 2026.

													*Revolving*
													*Loans at*
(Dollars in thousands)	*Term Loans Amortized Cost Basis by Origination Year*												*Amortized*
As of March 31, 2026	*2026*		*2025*		*2024*		*2023*		*2022*		*Prior*		*Cost Basis*		*Total*
Commercial and Industrial
Pass	$	226	$	4,929	$	751	$	3,109	$	299	$	5,242	$	24,581	$	39,137
OAEM		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		403		—		277		680
Doubtful		—		—		—		—		—		—		—		—
	$	226	$	4,929	$	751	$	3,109	$	702	$	5,242	$	24,858	$	39,817
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Construction
Pass	$	—	$	1,002	$	324	$	305	$	988	$	194	$	213,901	$	216,714
OAEM		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		1,091		—		1,091
Doubtful		—		—		—		—		—		—		—		—
	$	—	$	1,002	$	324	$	305	$	988	$	1,285	$	213,901	$	217,805
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Commercial – Owner Occupied
Pass	$	6,655	$	33,535	$	23,157	$	29,220	$	33,828	$	55,657	$	2,239	$	184,291
OAEM		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		400		—		400
Doubtful		—		—		—		—		—		—		—		—
	$	6,655	$	33,535	$	23,157	$	29,220	$	33,828	$	56,057	$	2,239	$	184,691
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Commercial – Non-owner Occupied
Pass	$	6,889	$	108,733	$	50,344	$	13,113	$	102,107	$	174,973	$	4,302	$	460,461
OAEM		—		—		—		—		—		2,159		—		2,159
Substandard		—		—		—		—		361		14,002		—		14,363
Doubtful		—		—		—		—		—		—		—		—
	$	6,889	$	108,733	$	50,344	$	13,113	$	102,468	$	191,134	$	4,302	$	476,983
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Residential – 1 to 4 Family
Performing	$	10,225	$	41,700	$	42,313	$	45,814	$	93,114	$	189,267	$	5,537	$	427,970
Nonperforming		—		—		—		786		731		977		—		2,494
	$	10,225	$	41,700	$	42,313	$	46,600	$	93,845	$	190,244	$	5,537	$	430,464
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Residential – 1 to 4 Family Investment
Performing	$	4,422	$	37,623	$	51,216	$	67,270	$	110,450	$	206,680	$	—	$	477,661
Nonperforming		—		—		—		1,108		—		329		—		1,437
	$	4,422	$	37,623	$	51,216	$	68,378	$	110,450	$	207,009	$	—	$	479,098
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Residential – Multifamily
Pass	$	14,804	$	42,698	$	13,913	$	4,786	$	71,389	$	62,987	$	—	$	210,577
OAEM		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		—		—		—
Doubtful		—		—		—		—		—		—		—		—
	$	14,804	$	42,698	$	13,913	$	4,786	$	71,389	$	62,987	$	—	$	210,577
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Consumer
Performing	$	—	$	—	$	221	$	—	$	—	$	3,490	$	9	$	3,720
Nonperforming		—		—		—		—		—		141		—		141
	$	—	$	—	$	221	$	—	$	—	$	3,631	$	9	$	3,861
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Total Loan Receivable	$	43,221	$	270,220	$	182,239	$	165,511	$	413,670	$	717,589	$	250,846	$	2,043,296

As of March 31, 2026, the Company was in the process of foreclosing on 21 residential 1 to 4 family loans with a principal balance of $5.2 million.

The following tables provide an analysis of loans by portfolio segment based on the credit quality indicators used to determine the allowance for credit losses, as of December 31, 2025.

													*Revolving*
													*Loans at*
(Dollars in thousands)	*Term Loans Amortized Cost Basis by Origination Year*												*Amortized*
As of December 31, 2025	*2025*		*2024*		*2023*		*2022*		*2021*		*Prior*		*Cost Basis*		*Total*
Commercial and Industrial
Pass	$	4,990	$	879	$	3,313	$	305	$	2	$	5,778	$	22,717	$	37,984
OAEM		—		—		—		—		—		—		—		—
Substandard		—		—		—		411		—		—		277		688
Doubtful		—		—		—		—		—		—		—		—
	$	4,990	$	879	$	3,313	$	716	$	2	$	5,778	$	22,994	$	38,672
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Construction
Pass	$	1,001	$	325	$	307	$	1,396	$	—	$	193	$	207,994	$	211,216
OAEM		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		1,091		—		1,091
Doubtful		—		—		—		—		—		—		—		—
	$	1,001	$	325	$	307	$	1,396	$	—	$	1,284	$	207,994	$	212,307
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Commercial – Owner Occupied
Pass	$	32,560	$	23,259	$	32,471	$	34,016	$	11,545	$	46,025	$	2,253	$	182,129
OAEM		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		400		—		400
Doubtful		—		—		—		—		—		—		—		—
	$	32,560	$	23,259	$	32,471	$	34,016	$	11,545	$	46,425	$	2,253	$	182,529
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Commercial – Non-owner Occupied
Pass	$	109,092	$	50,669	$	14,659	$	102,688	$	29,279	$	150,007	$	4,794	$	461,188
OAEM		—		—		—		—		—		2,176		—		2,176
Substandard		—		—		—		370		—		14,561		—		14,931
Doubtful		—		—		—		—		—		—		—		—
	$	109,092	$	50,669	$	14,659	$	103,058	$	29,279	$	166,744	$	4,794	$	478,295
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	202	$	—	$	202

Residential – 1 to 4 Family
Performing	$	59,089	$	43,287	$	47,018	$	95,574	$	49,503	$	148,408	$	5,619	$	448,498
Nonperforming		—		—		841		733		—		1,391		—		2,965
	$	59,089	$	43,287	$	47,859	$	96,307	$	49,503	$	149,799	$	5,619	$	451,463
Current period gross charge-offs	$	—	$	—	$	47	$	—	$	—	$	203	$	—	$	250

Residential – 1 to 4 Family Investment
Performing	$	39,340	$	52,575	$	70,258	$	114,208	$	90,734	$	125,273	$	—	$	492,388
Nonperforming		—		—		985		525		—		330		—		1,840
	$	39,340	$	52,575	$	71,243	$	114,733	$	90,734	$	125,603	$	—	$	494,228
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Residential – Multifamily
Pass	$	27,456	$	13,952	$	4,812	$	63,789	$	31,067	$	32,535	$	—	$	173,611
OAEM		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		—		—		—
Doubtful		—		—		—		—		—		—		—		—
	$	27,456	$	13,952	$	4,812	$	63,789	$	31,067	$	32,535	$	—	$	173,611
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Consumer
Performing	$	—	$	226	$	—	$	—	$	—	$	3,746	$	9	$	3,981
Nonperforming		—		—		—		—		—		141		—		141
	$	—	$	226	$	—	$	—	$	—	$	3,887	$	9	$	4,122
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Total Loan Receivable	$	273,528	$	185,172	$	174,664	$	414,015	$	212,130	$	532,055	$	243,663	$	2,035,227

Modifications to Borrowers Experiencing Financial Difficulty

During the periods ended March 31, 2026 and 2025, the Company did not make any modifications to borrowers experiencing financial difficulty.