| INVESTMENT SECURITIES |
2. INVESTMENT SECURITIES Available-for-Sale Debt Securities The following tables summarize the amortized cost and fair value of AFS debt securities, along with the related gross unrealized gains and losses recognized in AOCI: | | | | | | | | | | | | | | | | | Gross | | Gross | | | | | | Amortized | | Unrealized | | Unrealized | | Fair | June 30, 2026 (in thousands) | | Cost | | Gains | | Losses | | Value | | | | | | | | | | | | | | U.S. Treasury securities and U.S. Government agencies | | $ | 269,983 | | $ | 16 | | $ | (3,632) | | $ | 266,367 | Private label mortgage-backed security | | | — | | | 1,360 | | | — | | | 1,360 | Mortgage-backed securities - residential | | | 606,710 | | | 1,129 | | | (9,483) | | | 598,356 | Collateralized mortgage obligations | | | 16,579 | | | 24 | | | (388) | | | 16,215 | Corporate bonds | | | — | | | — | | | — | | | — | Trust preferred security | | | 3,951 | | | 733 | | | — | | | 4,684 | Total available-for-sale debt securities | | $ | 897,223 | | $ | 3,262 | | $ | (13,503) | | $ | 886,982 |
| | | | | | | | | | | | | | | | | Gross | | Gross | | | | | | Amortized | | Unrealized | | Unrealized | | Fair | December 31, 2025 (in thousands) | | Cost | | Gains | | Losses | | Value | | | | | | | | | | | | | | U.S. Treasury securities and U.S. Government agencies | | $ | 294,940 | | $ | 159 | | $ | (1,724) | | $ | 293,375 | Private label mortgage-backed security | | | — | | | 1,439 | | | — | | | 1,439 | Mortgage-backed securities - residential | | | 570,491 | | | 4,210 | | | (6,792) | | | 567,909 | Collateralized mortgage obligations | | | 17,528 | | | 27 | | | (648) | | | 16,907 | Corporate bonds | | | 1,001 | | | — | | | — | | | 1,001 | Trust preferred security | | | 3,924 | | | 138 | | | — | | | 4,062 | Total available-for-sale debt securities | | $ | 887,884 | | $ | 5,973 | | $ | (9,164) | | $ | 884,693 |
Held-to-Maturity Debt Securities The following tables summarize the amortized cost and fair value of HTM debt securities, together with the related gross unrecognized gains and losses: | | | | | | | | | | | | | | | | | | Gross | | Gross | | | | | | Amortized | | Unrecognized | | Unrecognized | | Fair | June 30, 2026 (in thousands) | | Cost | | Gains | | Losses | | Value | | | | | | | | | | | | | | Mortgage-backed securities - residential | | $ | 12 | | $ | — | | $ | — | | $ | 12 | Collateralized mortgage obligations | | | 4,534 | | | 3 | | | — | | | 4,537 | Total held-to-maturity debt securities | | $ | 4,546 | | $ | 3 | | $ | — | | $ | 4,549 |
| | | | | | | | | | | | | | | | | | Gross | | Gross | | | | | | Amortized | | Unrecognized | | Unrecognized | | Fair | December 31, 2025 (in thousands) | | Cost | | Gains | | Losses | | Value | | | | | | | | | | | | | | Mortgage-backed securities - residential | | $ | 13 | | $ | — | | $ | — | | $ | 13 | Collateralized mortgage obligations | | | 4,931 | | | 29 | | | (44) | | | 4,916 | Total held-to-maturity debt securities | | $ | 4,944 | | $ | 29 | | $ | (44) | | $ | 4,929 |
There were no HTM debt securities on nonaccrual or past due 90 days or more as of June 30, 2026, and December 31, 2025. There were no HTM debt securities considered collateral dependent as of June 30, 2026, and December 31, 2025. Sales and Calls of Available-for-Sale Debt Securities During the three and six months ended June 30, 2026, and 2025, there were no material sales of AFS debt securities and no material gains or losses on sales or calls of AFS debt securities. During the six months ended June 30, 2026, AFS debt securities with amortized cost of $90 million were called. During the six months ended June 30, 2025, AFS debt securities with amortized cost of $181 million were called. Debt Securities by Contractual Maturity The following table summarizes the amortized cost and fair value of debt securities by contractual maturity. Expected maturities may differ from contractual maturities due to the ability of issuers to call or prepay obligations, with or without call or prepayment penalties. Securities without a single contractual maturity date are presented separately. | | | | | | | | | | | | | | | Available-for-Sale | | Held-to-Maturity | | | Debt Securities | | Debt Securities | | | Amortized | | Fair | | Amortized | | Fair | June 30, 2026 (in thousands) | | Cost | | Value | | Cost | | Value | | | | | | | | | | | | | | Due in one year or less | | $ | 94,990 | | $ | 94,079 | | $ | — | | $ | — | Due from one year to five years | | | 174,993 | | | 172,288 | | | — | | | — | Due from five years to ten years | | | — | | | — | | | — | | | — | Due beyond ten years | | | 3,951 | | | 4,684 | | | — | | | — | Private label mortgage-backed security | | | — | | | 1,360 | | | — | | | — | Mortgage-backed securities - residential | | | 606,710 | | | 598,356 | | | 12 | | | 12 | Collateralized mortgage obligations | | | 16,579 | | | 16,215 | | | 4,534 | | | 4,537 | Total debt securities | | $ | 897,223 | | $ | 886,982 | | $ | 4,546 | | $ | 4,549 |
Unrealized Loss Analysis on Debt Securities The following tables summarize AFS debt securities in unrealized loss positions for which no ACLS was recorded, by investment category and duration of the continuous unrealized loss position: | | | | | | | | | | | | | | | | | | | | | Less than 12 months | | 12 months or more | | Total | | | | | | Unrealized | | | | | Unrealized | | | | | Unrealized | June 30, 2026 (in thousands) | | Fair Value | | Losses | | Fair Value | | Losses | | Fair Value | | Losses | | | | | | | | | | | | | | | | | | | | Available-for-sale debt securities: | | | | | | | | | | | | | | | | | | | U.S. Treasury securities and U.S. Government agencies | | $ | 172,289 | | $ | (2,704) | | $ | 79,068 | | $ | (928) | | $ | 251,357 | | $ | (3,632) | Mortgage-backed securities - residential | | | 261,134 | | | (2,617) | | | 74,936 | | | (6,866) | | | 336,070 | | | (9,483) | Collateralized mortgage obligations | | | 580 | | | (6) | | | 13,490 | | | (382) | | | 14,070 | | | (388) | Total available-for-sale debt securities | | $ | 434,003 | | $ | (5,327) | | $ | 167,494 | | $ | (8,176) | | $ | 601,497 | | $ | (13,503) |
| | | | | | | | | | | | | | | | | | | | | Less than 12 months | | 12 months or more | | Total | | | | | | Unrealized | | | | | Unrealized | | | | | Unrealized | December 31, 2025 (in thousands) | | Fair Value | | Losses | | Fair Value | | Losses | | Fair Value | | Losses | | | | | | | | | | | | | | | | | | | | Available-for-sale debt securities: | | | | | | | | | | | | | | | | | | | U.S. Treasury securities and U.S. Government agencies | | $ | 84,947 | | $ | (53) | | $ | 78,317 | | $ | (1,671) | | $ | 163,264 | | $ | (1,724) | Mortgage-backed securities - residential | | | 84,131 | | | (149) | | | 86,744 | | | (6,643) | | | 170,875 | | | (6,792) | Collateralized mortgage obligations | | | — | | | — | | | 14,242 | | | (648) | | | 14,242 | | | (648) | Total available-for-sale debt securities | | $ | 169,078 | | $ | (202) | | $ | 179,303 | | $ | (8,962) | | $ | 348,381 | | $ | (9,164) |
As of June 30, 2026, the Bank’s security portfolio consisted of 200 securities, 109 of which were in an unrealized loss position. As of December 31, 2025, the Bank’s security portfolio consisted of 198 securities, 86 of which were in an unrealized loss position. As of June 30, 2026, and December 31, 2025, there were no holdings of debt securities of any one issuer, other than the U.S. government and its agencies, in an amount greater than 10% of stockholders’ equity. Accrued interest receivable on AFS debt securities is included in other assets on the Consolidated Balance Sheets and is excluded from the ACLS, when applicable. Accrued interest receivable on AFS debt securities totaled $5 million and $5 million as of June 30, 2026, and December 31, 2025. Accrued interest receivable on HTM debt securities totaled $10,000 as of June 30, 2026, and $12,000 as of December 31, 2025. Mortgage-Backed Securities and Collateralized Mortgage Obligations As of June 30, 2026, all MBSs and CMOs held by the Bank, other than the private label MBS, were issued by U.S. government-sponsored entities and agencies, primarily the FHLMC and FNMA. As of June 30, 2026, and December 31, 2025, there were gross unrealized losses of approximately $9 million and $7 million related to AFS MBS’s and CMO’s. Because these unrealized losses are attributable to changes in interest rates and illiquidity, and not credit quality, and because the Bank does not have the intent to sell these securities, and it is likely that it will not be required to sell the securities before their anticipated recovery, management does not consider these securities to have credit-related impairment that would require an adjustment to the ACLS. Pledged Debt Securities Debt securities pledged to secure public deposits, SSUAR, and other obligations, or otherwise held for other purposes permitted by law, were as follows: | | | | | | | | | | As of | | (in thousands) | | June 30, 2026 | | December 31, 2025 | | | | | | | | | | Amortized cost | | $ | 128,191 | | $ | 168,530 | | Fair value | | | 126,162 | | | 166,757 | | Carrying amount | | | 126,162 | | | 166,757 | |
Equity Securities The following tables summarize the amortized cost and fair value of equity securities with readily determinable fair values: | | | | | | | | | | | | | | | | | Gross | | Gross | | | | | | Amortized | | Unrealized | | Unrealized | | Fair | June 30, 2026 (in thousands) | | Cost | | Gains | | Losses | | Value | | | | | | | | | | | | | | Freddie Mac preferred stock | | $ | — | | $ | 588 | | $ | — | | $ | 588 |
| | | | | | | | | | | | | | | | | Gross | | Gross | | | | | | Amortized | | Unrealized | | Unrealized | | Fair | December 31, 2025 (in thousands) | | Cost | | Gains | | Losses | | Value | | | | | | | | | | | | | | Freddie Mac preferred stock | | $ | — | | $ | 945 | | $ | — | | $ | 945 |
The following table presents the gross realized and unrealized gains and losses recognized in the Company's consolidated statements of income for equity securities with readily determinable fair values: | | | | | | | | | | | | | | | | | | | | | | Gains (Losses) Recognized on Equity Securities | | | | Three Months Ended June 30, 2026 | | Three Months Ended June 30, 2025 | | (in thousands) | | Realized | | Unrealized | | Total | | Realized | | Unrealized | | Total | | | | | | | | | | | | | | | | | | | | | | Freddie Mac preferred stock | | $ | — | | $ | 357 | | $ | 357 | | $ | — | | $ | 32 | | $ | 32 | |
| | | | | | | | | | | | | | | | | | | | | | Gains (Losses) Recognized on Equity Securities | | | Six Months Ended June 30, 2026 | | Six Months Ended June 30, 2025 | | (in thousands) | | Realized | | Unrealized | | Total | | Realized | | Unrealized | | Total | | | | | | | | | | | | | | | | | | | | | | Freddie Mac preferred stock | | $ | — | | $ | 357 | | $ | 357 | | $ | — | | $ | 63 | | $ | 63 | |
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