| INVESTMENT SECURITIES |
NOTE 4 — INVESTMENT SECURITIES The following tables summarize the amortized cost and fair value of AFS and HTM debt securities and equity investments and the corresponding amounts of gross unrealized gains and losses recognized in accumulated other comprehensive income (loss) and gross unrecognized gains and losses recognized in earnings (in thousands): | | | | | | | | | | | | | | | | | | Gross | | Gross | | | | | | | | | Unrealized/ | | Unrealized/ | | | | | | Amortized | | Unrecognized | | Unrecognized | | | | At March 31, 2026 | | Cost | | Gains | | Losses | | Fair Value | Available-for-Sale Securities: | | | | | | | | | | | | | U.S. Government agency securities | | $ | 20,000 | | $ | — | | $ | (1,828) | | $ | 18,172 | U.S. State and Municipal securities | | | 11,144 | | | — | | | (1,468) | | | 9,676 | Residential MBS | | | 628,441 | | | 1,195 | | | (53,344) | | | 576,292 | Commercial MBS | | | 45,463 | | | — | | | (2,187) | | | 43,276 | Asset-backed securities | | | 2,353 | | | — | | | (50) | | | 2,303 | Total securities available-for-sale | | $ | 707,401 | | $ | 1,195 | | $ | (58,877) | | $ | 649,719 | | | | | | | | | | | | | | Held-to-Maturity Securities: | | | | | | | | | | | | | U.S. State and Municipal securities | | $ | 15,001 | | $ | — | | $ | (1,459) | | $ | 13,542 | Residential MBS | | | 324,825 | | | — | | | (43,399) | | | 281,426 | Commercial MBS | | | 8,042 | | | — | | | (478) | | | 7,564 | Total securities held-to-maturity | | $ | 347,868 | | $ | — | | $ | (45,336) | | $ | 302,532 | | | | | | | | | | | | | | Equity Investments: | | | | | | | | | | | | | CRA Mutual Fund | | $ | 5,903 | | $ | — | | $ | (278) | | $ | 5,625 | Total equity investment securities | | $ | 5,903 | | $ | — | | $ | (278) | | $ | 5,625 |
| | | | | | | | | | | | | | | | | | Gross | | Gross | | | | | | | | | Unrealized/ | | Unrealized/ | | | | | | Amortized | | Unrecognized | | Unrecognized | | | | At December 31, 2025 | | Cost | | Gains | | Losses | | Fair Value | Available-for-Sale Securities: | | | | | | | | | | | | | U.S. Government agency securities | | $ | 30,000 | | $ | — | | $ | (1,886) | | $ | 28,114 | U.S. State and Municipal securities | | | 11,184 | | | — | | | (1,456) | | | 9,728 | Residential MBS | | | 543,349 | | | 2,409 | | | (50,726) | | | 495,032 | Commercial MBS | | | 45,560 | | | 79 | | | (1,939) | | | 43,700 | Asset-backed securities | | | 2,419 | | | — | | | (61) | | | 2,358 | Total securities available-for-sale | | $ | 632,512 | | $ | 2,488 | | $ | (56,068) | | $ | 578,932 | | | | | | | | | | | | | | Held-to-Maturity Securities: | | | | | | | | | | | | | U.S. State and Municipal securities | | | 15,065 | | | — | | | (1,402) | | | 13,663 | Residential MBS | | | 333,515 | | | — | | | (41,662) | | | 291,853 | Commercial MBS | | | 8,047 | | | — | | | (481) | | | 7,566 | Total securities held-to-maturity | | $ | 356,627 | | $ | — | | $ | (43,545) | | $ | 313,082 | | | | | | | | | | | | | | Equity Investments: | | | | | | | | | | | | | CRA Mutual Fund | | $ | 5,858 | | $ | — | | $ | (249) | | $ | 5,609 | Total equity investment securities | | $ | 5,858 | | $ | — | | $ | (249) | | $ | 5,609 |
There were no proceeds from sales or calls of AFS securities for the three months ended March 31, 2026 and 2025. The tables below summarize, by contractual maturity, the amortized cost and fair value of debt securities. The tables do not include the effect of principal repayments or scheduled principal amortization. Equity securities, primarily investments in mutual funds, have been excluded from the table. Expected maturities may differ from contractual maturities if borrowers have the right to call or prepay obligations with or without call or prepayment penalties (in thousands): | | | | | | | | | | | | | | | Held-to-Maturity | | Available-for-Sale | At March 31, 2026 | | Amortized Cost | | Fair Value | | Amortized Cost | | Fair Value | Due within 1 year | | $ | — | | $ | — | | $ | — | | $ | — | After 1 year through 5 years | | | — | | | — | | | 15,000 | | | 14,302 | After 5 years through 10 years | | | — | | | — | | | 9,822 | | | 7,864 | After 10 years | | | 15,001 | | | 13,542 | | | 6,322 | | | 5,682 | Mortgage-backed and Asset-backed Securities | | | 332,867 | | | 288,990 | | | 676,257 | | | 621,871 | Total Securities | | $ | 347,868 | | $ | 302,532 | | $ | 707,401 | | $ | 649,719 |
| | | | | | | | | | | | | | | Held-to-Maturity | | Available-for-Sale | At December 31, 2025 | | Amortized Cost | | Fair Value | | Amortized Cost | | Fair Value | Due within 1 year | | $ | — | | | — | | | 10,000 | | | 9,960 | After 1 year through 5 years | | | — | | | — | | | 15,000 | | | 14,261 | After 5 years through 10 years | | | — | | | — | | | 4,823 | | | 3,985 | After 10 years | | | 15,065 | | | 13,663 | | | 11,361 | | | 9,636 | Mortgage-backed and Asset-backed Securities | | | 341,562 | | | 299,419 | | | 591,328 | | | 541,090 | Total Securities | | $ | 356,627 | | $ | 313,082 | | $ | 632,512 | | $ | 578,932 |
At March 31, 2026, there were $882.1 million of securities pledged to support wholesale funding, and to a lesser extent certain other types of deposits, of which $125.1 million was encumbered. At December 31, 2025, there were $807.5 million of securities pledged to support wholesale funding, and to a lesser extent certain other types of deposits, of which $118.2 million was encumbered. At March 31, 2026 and December 31, 2025, there were no holdings of securities of any one issuer, other than the U.S. Government and its agencies, in an amount greater than 10% of stockholders’ equity. At March 31, 2026 and December 31, 2025, all of the residential MBS and commercial MBS held by the Company were issued by U.S. Government-sponsored entities and agencies. The following tables present debt securities with unrealized/unrecognized losses aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position (in thousands): | | | | | | | | | | | | | | | | | | | | | Less than 12 Months | | 12 Months or More | | Total | | | | | | Unrealized/ | | | | | Unrealized/ | | | | | Unrealized/ | | | Estimated | | Unrecognized | | Estimated | | Unrecognized | | Estimated | | Unrecognized | At March 31, 2026 | | Fair Value | | Losses | | Fair Value | | Losses | | Fair Value | | Losses | Available-for-Sale Securities: | | | | | | | | | | | | | | | | | | | U.S. Government agency securities | | $ | — | | $ | — | | $ | 18,172 | | $ | (1,828) | | $ | 18,172 | | $ | (1,828) | U.S. State and Municipal securities | | | — | | | — | | | 9,676 | | | (1,468) | | | 9,676 | | | (1,468) | Residential MBS | | | 177,994 | | | (1,392) | | | 233,677 | | | (51,952) | | | 411,671 | | | (53,344) | Commercial MBS | | | 20,274 | | | (71) | | | 23,002 | | | (2,116) | | | 43,276 | | | (2,187) | Asset-backed securities | | | — | | | — | | | 2,303 | | | (50) | | | 2,303 | | | (50) | Total securities available-for-sale | | $ | 198,268 | | $ | (1,463) | | $ | 286,830 | | $ | (57,414) | | $ | 485,098 | | $ | (58,877) | | | | | | | | | | | | | | | | | | | | Held-to-Maturity Securities: | | | | | | | | | | | | | | | | | | | U.S. State and Municipal securities | | $ | — | | $ | — | | $ | 13,542 | | $ | (1,459) | | $ | 13,542 | | $ | (1,459) | Residential MBS | | | — | | | — | | | 281,426 | | | (43,399) | | | 281,426 | | | (43,399) | Commercial MBS | | | — | | | — | | | 7,564 | | | (478) | | | 7,564 | | | (478) | Total securities held-to-maturity | | $ | — | | $ | — | | $ | 302,532 | | $ | (45,336) | | $ | 302,532 | | $ | (45,336) |
| | | | | | | | | | | | | | | | | | | | | Less than 12 Months | | 12 Months or More | | Total | | | | | | Unrealized/ | | | | | Unrealized/ | | | | | Unrealized/ | | | Estimated | | Unrecognized | | Estimated | | Unrecognized | | Estimated | | Unrecognized | At December 31, 2025 | | Fair Value | | Losses | | Fair Value | | Losses | | Fair Value | | Losses | Available-for-Sale Securities: | | | | | | | | | | | | | | | | | | | U.S. Government agency securities | | $ | — | | $ | — | | $ | 28,114 | | $ | (1,886) | | $ | 28,114 | | $ | (1,886) | U.S. State and Municipal securities | | | — | | | — | | | 9,728 | | | (1,456) | | | 9,728 | | | (1,456) | Residential MBS | | | — | | | — | | | 241,900 | | | (50,726) | | | 241,900 | | | (50,726) | Commercial MBS | | | 10,878 | | | (13) | | | 23,354 | | | (1,926) | | | 34,232 | | | (1,939) | Asset-backed securities | | | — | | | — | | | 2,358 | | | (61) | | | 2,358 | | | (61) | Total securities available-for-sale | | $ | 10,878 | | $ | (13) | | $ | 305,454 | | $ | (56,055) | | $ | 316,332 | | $ | (56,068) | | | | | | | | | | | | | | | | | | | | Held-to-Maturity Securities: | | | | | | | | | | | | | | | | | | | U.S. State and Municipal securities | | | — | | | — | | | 13,663 | | | (1,402) | | | 13,663 | | | (1,402) | Residential MBS | | | — | | | — | | | 291,853 | | | (41,662) | | | 291,853 | | | (41,662) | Commercial MBS | | | — | | | — | | | 7,566 | | | (481) | | | 7,566 | | | (481) | Total securities held-to-maturity | | $ | — | | $ | — | | $ | 313,082 | | $ | (43,545) | | $ | 313,082 | | $ | (43,545) |
Except for U.S. State and Municipal securities, the Company has a zero loss expectation for its HTM securities portfolio, and therefore has no ACL related to these securities. Obligations of U.S. State and Municipal securities were rated investment grade and the associated ACL was immaterial at March 31, 2026 and December 31, 2025. AFS securities in unrealized loss positions are evaluated for impairment related to credit losses on a quarterly basis. The unrealized losses on AFS securities are primarily due to the changes in market interest rates subsequent to purchase. In addition, the Company does not intend, nor would it be required, to sell these investments until there is a full recovery of the unrealized loss, which may be at maturity. As a result, no ACL was recognized during the three months ended March 31, 2026 and 2025.
|