v3.26.1
INVESTMENT SECURITIES
 6 Months Ended
Jun. 30, 2026
Investment Securities [Abstract]  
Investment Securities
NOTE 2 –
INVESTMENT SECURITIES
Investment Portfolio Composition
. The following table summarizes the amortized cost and related fair value of investment
securities available-for-sale (“AFS”) and securities held-to-maturity (“HTM”)
and the corresponding amounts of gross
unrealized gains and losses.
Available for
Sale
Amortized
Unrealized
Unrealized
Allowance for
Fair
(Dollars in Thousands)
Cost
Gains
Losses
Credit Losses
Value
June 30, 2026
U.S. Government Treasury
$
554,416
$
70
$
3,884
$
-
$
550,602
U.S. Government Agency
180,039
36
2,781
-
177,294
States and Political Subdivisions
36,230
29
2,047
-
34,212
Mortgage-Backed Securities
(1)
56,624
-
8,000
-
48,624
Corporate Debt Securities
36,933
1
2,169
(44)
34,721
Other Securities
(2)
8,155
-
-
-
8,155
Total
$
872,397
$
136
$
18,881
$
(44)
$
853,608
December 31, 2025
U.S. Government Treasury
$
331,495
$
1,940
$
171
$
-
$
333,264
U.S. Government Agency
174,527
71
2,484
-
172,114
States and Political Subdivisions
36,918
38
2,045
-
34,911
Mortgage-Backed Securities
(1)
59,699
2
7,697
-
52,004
Corporate Debt Securities
45,810
-
2,236
(42)
43,532
Other Securities
(2)
8,097
-
-
-
8,097
Total
$
656,546
$
2,051
$
14,633
$
(42)
$
643,922
Held to Maturity
Amortized
Unrealized
Unrealized
Fair
(Dollars in Thousands)
Cost
Gains
Losses
Value
June 30, 2026
U.S. Government Treasury
$
8,587
$
-
$
8
$
8,579
Mortgage-Backed Securities
(1)
295,873
146
10,528
285,491
Total
$
304,460
$
146
$
10,536
$
294,070
December 31, 2025
U.S. Government Treasury
$
129,782
$
-
$
514
$
129,268
Mortgage-Backed Securities
(1)
247,664
930
8,542
240,052
Total
$
377,446
$
930
$
9,056
$
369,320
(1)
Comprised of residential mortgage-backed
securities.
(2)
Includes Federal Home Loan Bank stock recorded
at cost of $
3.1
million and $
3.0
million at June 30, 2026 and December 31,
2025, respectively,
and Federal Reserve Bank stock recorded
at cost of $
5.1
million at June 30, 2026 and December 31, 2025.
At June 30, 2026 and December 31, 2025, the investment portfolio had $
2.1
million in equity securities. These securities do not have a
readily determinable fair value and were not credit impaired.
Securities with an amortized cost of $
563.0
million and $
461.3
million at June 30, 2026 and December 31, 2025, respectively,
were
pledged to secure public deposits and for other purposes.
The Bank, as a member of the Federal Home Loan Bank of Atlanta (“FHLB”), is required
to own capital stock in the FHLB based
generally upon the balances of residential and commercial real estate loans, and
FHLB advances. The Bank’s investment
in FHLB
stock, which is included in other securities,
is pledged to secure FHLB advances.
No ready market exists for this stock, and it has no
quoted fair value; however, redemption
of this stock has historically been at par value.
As a member of the Federal Reserve Bank of
Atlanta, the Bank is required to maintain stock in the Federal Reserve Bank of Atlanta
based on a specified ratio relative to the Bank’s
capital.
Federal Reserve Bank stock is carried at cost.
Investment Sales.
There were
no
sales of investment securities for the three and six months ended June 30, 2026
and 2025.
Maturity Distribution
.
At June 30, 2026, the Company’s investment
securities had the following maturity distribution based on
contractual maturity.
Expected maturities may differ from contractual maturities because borrowers
may have the right to call or
prepay obligations.
Mortgage-backed securities, certain amortizing U.S. government agency
securities and other securities are shown
separately because they are not due at a certain maturity date.
Available for
Sale
Held to Maturity
(Dollars in Thousands)
Amortized Cost
Fair Value
Amortized Cost
Fair Value
Due in one year or less
$
164,396
$
163,918
$
8,587
$
8,579
Due after one year through five years
490,095
482,562
-
-
Due after five year through ten years
3,220
2,852
-
-
Mortgage-Backed Securities
56,624
48,624
295,873
285,491
U.S. Government Agency
149,907
147,497
-
-
Other Securities
8,155
8,155
-
-
Total
$
872,397
$
853,608
$
304,460
$
294,070
Unrealized Losses on Investment Securities.
The following table summarizes the available for sale and held to maturity
investment
securities with unrealized losses aggregated by major security type and length
of time in a continuous unrealized loss position:
Less Than
Greater Than
12 Months
12 Months
Total
Fair
Unrealized
Fair
Unrealized
Fair
Unrealized
(Dollars in Thousands)
Value
Losses
Value
Losses
Value
Losses
June 30, 2026
Available for
Sale
U.S. Government Treasury
$
455,403
$
3,841
$
5,968
$
43
$
461,371
$
3,884
U.S. Government Agency
73,602
597
92,621
2,184
166,223
2,781
States and Political Subdivisions
965
14
32,331
2,033
33,296
2,047
Mortgage-Backed Securities
52
-
48,562
8,000
48,614
8,000
Corporate Debt Securities
-
-
33,889
2,169
33,889
2,169
Total
$
530,022
$
4,452
$
213,371
$
14,429
$
743,393
$
18,881
Held to Maturity
U.S. Government Treasury
-
-
8,578
8
8,578
8
Mortgage-Backed Securities
156,316
1,640
90,125
8,888
246,441
10,528
Total
$
156,316
$
1,640
$
98,703
$
8,896
$
255,019
$
10,536
December 31, 2025
Available for
Sale
U.S. Government Treasury
$
31,319
$
22
$
8,902
$
149
$
40,221
$
171
U.S. Government Agency
62,809
182
91,760
2,302
154,569
2,484
States and Political Subdivisions
3,030
124
30,705
1,921
33,735
2,045
Mortgage-Backed Securities
-
-
51,932
7,697
51,932
7,697
Corporate Debt Securities
-
-
42,333
2,236
42,333
2,236
Total
$
97,158
$
328
$
225,632
$
14,305
$
322,790
$
14,633
Held to Maturity
U.S. Government Treasury
-
-
129,268
514
129,268
514
Mortgage-Backed Securities
33,589
98
106,262
8,444
139,851
8,542
Total
$
33,589
$
98
$
235,530
$
8,958
$
269,119
$
9,056
At June 30, 2026, there were
816
positions (combined AFS and HTM) with unrealized pre-tax losses totaling $
29.4
million.
69
of
these positions are U.S. Treasury bonds
and carry the full faith and credit of the U.S. Government.
675
are U.S. government agency
securities issued by U.S. government sponsored entities.
We believe
the long history of no credit losses on government securities
indicates that the expectation of nonpayment of the amortized cost basis is effectively
zero.
At June 30, 2026, all collateralized
mortgage obligation securities, mortgage-backed securities, Small Business
Administration securities, U.S. Agency,
and U.S. Treasury
bonds held were AAA rated.
The remaining
72
positions (municipal securities and corporate bonds) have a credit component.
At
June 30, 2026, corporate debt securities had an allowance for credit
losses of $
44,000
.
No
ne of the securities held by the Company
were past due or in nonaccrual status at June 30, 2026.
Credit Quality Indicators
The Company monitors the credit quality of its investment securities through
various risk management procedures, including the
monitoring of credit ratings.
A majority of the debt securities in the Company’s
investment portfolio were issued by a U.S.
government entity or agency and are either explicitly or implicitly guaranteed
by the U.S. government.
The Company believes the
long history of no credit losses on these securities indicates that the expectation
of nonpayment of the amortized cost basis is
effectively zero, even if the U.S. government were
to technically default.
Further, certain municipal securities held by the Company
have been pre-refunded and secured by government guaranteed
treasuries.
Therefore, for the aforementioned securities, the Company
does
no
t assess or record expected credit losses due to the zero loss assumption.
The Company monitors the credit quality of its
municipal and corporate securities portfolio via credit ratings
which are updated on a quarterly basis.
On a quarterly basis, municipal
and corporate securities in an unrealized loss position are evaluated to determine
if the loss is attributable to credit related factors and
if an allowance for credit loss is needed.