v3.26.1
Fair Value Disclosure
 3 Months Ended
Mar. 31, 2026
Fair Value Disclosures [Abstract]  
Fair Value Disclosure Fair Value Disclosure
ASC Topic 820 “Fair Value Measurement” defines fair value and provides the framework for measuring fair value and required disclosures about fair value measurements. Fair value is defined as the price that would be received for an asset or paid to transfer a liability in an orderly transaction between market participants in the principal or most advantageous market for the asset or liability at the transaction date. ASC 820 establishes a fair value hierarchy that prioritizes the inputs used in valuation methods to determine fair value.
The three levels of fair value hierarchy are as follows:
Level 1 –    Fair value is based on unadjusted quoted prices in active markets that are accessible to the Company for identical assets. These generally provide the most reliable evidence and are used to measure fair value whenever available.
Level 2 –    Fair value is based on significant inputs, other than Level 1 inputs, that are observable either directly or indirectly for substantially the full term of the asset through corroboration with observable market data. Level 2 inputs include quoted market prices in active markets for similar assets, quoted market prices in markets that are not active for identical or similar assets, and other observable inputs.
Level 3 –    Fair value is based on significant unobservable inputs. Examples of valuation methodologies that would result in Level 3 classification include option pricing models, discounted cash flows, and other similar techniques.
This hierarchy requires the use of observable market data when available. The level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement.
The majority of the Company’s securities are included in Level 2 of the fair value hierarchy. Fair values for Level 2 securities were primarily determined by a third-party pricing service using both quoted prices for similar assets, when available, and model-based valuation techniques that derive fair value based on market-corroborated data, such as instruments with similar prepayment speeds and default interest rates. The standard inputs that are normally used include benchmark yields of like securities, reportable trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers, and reference data including market research publications.
The Company uses derivative instruments, including interest rate swaps and risk participation agreements, and the fair value of such instruments are calculated using accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of each derivative, considering the contractual terms of each derivative, and uses observable market-based inputs, such as interest rate curves and implied volatilities. Credit valuation adjustments are incorporated to appropriately reflect nonperformance risk and the respective counterparties' nonperformance risk in calculating fair value measurements. These instruments are classified as Level 2.
There were no transfers into or out of Level 3 during the three months ended March 31, 2026 or year ended December 31, 2025.
The following table presents the financial assets measured at fair value on a recurring basis and reported on the Consolidated Statements of Financial Condition as of the dates indicated, by level within the fair value hierarchy:
Fair Value
Hierarchy
March 31, 2026December 31, 2025
(Dollars in Thousands)
ASSETS
Available-for-Sale Debt Securities
U.S. Government Agencies
Level 2
$1,967 $— 
Obligations of States and Political Subdivisions
Level 2
35,753 36,224 
Mortgage-Backed Securities - Government-Sponsored Enterprises
Level 2
47,734 41,089 
Collateralized Mortgage Obligations - Government Sponsored Enterprises
Level 2
80,480 67,575 
Collateralized Mortgage Obligations - Non-AgencyLevel 29,920 10,547 
Collateralized Loan ObligationsLevel 296,190 101,218 
Corporate DebtLevel 222,491 22,333 
Total Available-for-Sale Debt Securities294,535 278,986 
Equity Securities
Mutual Funds
Level 1
917 909 
Total Equity Securities917 909 
Total Securities295,452 279,895 
Derivative Financial Assets
Interest Rate Swaps - Commercial LoansLevel 2$37 $103 
Total Assets$295,489 $279,998 
LIABILITIES
Derivative Financial Liabilities
Interest Rate SwapsLevel 2$401 $704 
Interest Rate Swaps - Commercial LoansLevel 237 103 
Risk Participation AgreementsLevel 260 66 
Total Liabilities$498 $873 
The following table presents the financial assets on the Consolidated Statements of Financial Condition measured at fair value on a nonrecurring basis as of the dates indicated by level within the fair value hierarchy for only those nonrecurring assets that had a fair value below the carrying amount. The table also presents the significant unobservable inputs used in the fair value measurements.
Financial AssetFair Value HierarchyMarch 31,
2026		Valuation
Techniques		Significant Unobservable InputsRangeWeighted Average
(Dollars in Thousands)
Collateral-Dependent Loans Individually AssessedLevel 3$1,523 
Appraisal of Collateral (1)
Appraisal Adjustments (2)
31%to86%59.9%
Financial AssetFair Value HierarchyDecember 31,
2025		Valuation
Techniques		Significant Unobservable InputsRangeWeighted Average
(Dollars in Thousands)
Collateral-Dependent Loans Individually AssessedLevel 3$805 
Appraisal of Collateral (1)
Appraisal Adjustments (2)
31%to85%
69.9%
(1)Fair value is generally determined through independent appraisals of the underlying collateral, which may include various Level 3 inputs, which are not identifiable.
(2)Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated liquidation expenses. The range and weighted average of appraisal adjustments and liquidation expense are presented as a percent of the appraisal.
Collateral-dependent loans are evaluated and valued at the time the loan is identified as collateral-dependent, at the lower of cost or fair value. Fair value is measured based on the value of the collateral securing the loans and is classified as Level 3 in the fair value hierarchy. At March 31, 2026, the fair value of these loans consisted of loan balances of $1.9 million less specific valuation allowances of $331,000. At December 31, 2025, the fair value of these loans consisted of loan balances of $1.0 million less specific valuation allowances of $165,000.
Financial instruments are defined as cash, evidence of an ownership in an entity, or a contract which creates an obligation or right to receive or deliver cash or another financial instrument from/to a second entity on potentially favorable or unfavorable terms.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. If no readily available market exists, the fair value estimates for financial instruments should be based upon management’s judgment regarding current economic conditions, interest rate risk, expected cash flows, future estimated losses and other factors, as determined through various option pricing formulas or simulation modeling. As many of these assumptions result from judgments made by management based upon estimates which are inherently uncertain, the resulting estimated fair values may not be indicative of the amount realizable in the sale of a particular financial instrument. In addition, changes in the assumptions on which the estimated fair values are based may have significant impact on the resulting estimated fair values.
As certain assets such as deferred tax assets and premises and equipment are not considered financial instruments, the estimated fair value of financial instruments would not represent the full value of the Company.
The following table presents the estimated fair values of the Company’s financial instruments at the dates indicated.
March 31, 2026December 31, 2025
Fair Value
Hierarchy
Carrying
Value
Fair
Value
Carrying
Value
Fair
Value
(Dollars in Thousands)
Financial Assets:
Cash and Due From Banks:
Interest-Earning
Level 1
$42,849 $42,849 $18,374 $18,374 
Noninterest-Earning
Level 1
12,700 12,700 13,319 13,319 
Securities
See Above
295,452 295,452 279,895 279,895 
Loans, Net
Level 3
1,147,534 1,113,261 1,152,144 1,119,213 
Restricted Stock
Level 2
3,587 3,587 2,985 2,985 
Mortgage Servicing RightsLevel 3403 696 415 700 
Derivative AssetsLevel 237 37 103 103 
Accrued Interest Receivable
Level 2
6,451 6,451 6,374 6,374 
Financial Liabilities:
Deposits
Level 2
1,375,437 1,374,804 1,339,805 1,339,286 
Other Borrowed Funds
FHLB BorrowingsLevel 220,000 20,035 20,000 20,109 
Subordinated DebtLevel 214,768 14,322 14,758 14,452 
Derivative LiabilitiesLevel 2498 498 873 873 
Accrued Interest Payable
Level 2
1,920 1,920 2,021 2,021