Note 2 - Debt Securities

6 Months Ended

Jun. 30, 2026

Notes to Financial Statements

Investment in Debt and Equity Securities and Other Trading Assets [Text Block]

NOTE 2 – DEBT SECURITIES

The Company did not hold securities classified as trading or held-to-maturity as of June 30, 2026 or December 31, 2025. The amortized cost and estimated fair value of available-for-sale debt securities as of June 30, 2026 and December 31, 2025 consisted of the following:

		*June 30, 2026*
						*Gross*				*Gross*				*Estimated*
		*Amortized*				*Unrealized*				*Unrealized*				*Fair*
(In thousands)		*Cost*				*Gains*				*Losses*				*Value*
Available-for-sale:
U.S. Treasury securities and obligations of U.S. government agencies		$	424			$	-			$	(21	)		$	403
Commercial mortgage-backed securities			16,025				-				(172	)			15,853
Residential mortgage-backed securities			213,786				114				(2,686	)			211,214
U.S. states and political subdivisions			4,712				51				(37	)			4,726
Total available-for-sale		$	234,947			$	165			$	(2,916	)		$	232,196

		*December 31, 2025*
						*Gross*				*Gross*				*Estimated*
		*Amortized*				*Unrealized*				*Unrealized*				*Fair*
(In thousands)		*Cost*				*Gains*				*Losses*				*Value*
Available-for-sale:
U.S. Treasury securities and obligations of U.S. government agencies		$	478			$	-			$	(20	)		$	458
Commercial mortgage-backed securities			5,454				3				(27	)			5,430
Residential mortgage-backed securities			207,847				340				(635	)			207,552
U.S. states and political subdivisions			4,709				72				(61	)			4,720
Total available-for-sale		$	218,488			$	415			$	(743	)		$	218,160

Net unrealized losses on available-for-sale debt securities totaling ($2.0 million) were recorded as accumulated other comprehensive loss, net of tax of $781 thousand, within shareholders' equity as of June 30, 2026. Net unrealized losses on available-for-sale debt securities totaling ($234 thousand) were recorded as accumulated other comprehensive loss, net of tax of $94 thousand, within shareholders' equity as of December 31, 2025.

During the three and six months ended June 30, 2026, the Company purchased $30.3 million of available-for-sale debt securities with an average yield of 5.17% and a duration of 3.19 years. During the three and six months ended June 30, 2026, there were no sales or calls of debt securities and no gains realized or losses recognized. There were no transfers between investment categories during the three and six months ended June 30, 2026 and 2025.

Debt securities with unrealized losses as of June 30, 2026 and December 31, 2025 are summarized and classified according to the duration of the loss period as follows: (in thousands)

		*Less than 12 Months*								*12 Months or More*								*Total*
						*Unrealized*								*Unrealized*								*Unrealized*
June 30, 2026		*Fair Value*				*Losses*				*Fair Value*				*Losses*				*Fair Value*				*Losses*
U.S. Treasury securities and obligations of U.S. government agencies		$	-			$	-			$	403			$	(21	)		$	403			$	(21	)
Commercial mortgage-backed securities			15,854				(172	)			-				-				15,854				(172	)
Residential mortgage-backed securities			168,811				(2,461	)			1,750				(225	)			170,561				(2,686	)
U.S. states and political subdivisions			-				-				896				(37	)			896				(37	)
Total available-for-sale		$	184,665			$	(2,633	)		$	3,049			$	(283	)		$	187,714			$	(2,916	)

		*Less than 12 Months*								*12 Months or More*								*Total*
						*Unrealized*								*Unrealized*								*Unrealized*
December 31, 2025		*Fair Value*				*Losses*				*Fair Value*				*Losses*				*Fair Value*				*Losses*
U.S. Treasury securities and obligations of U.S. government agencies		$	-			$	-			$	458			$	(20	)		$	458			$	(20	)
Commercial mortgage-backed securities			3,441				(20	)			1,004				(7	)			4,445				(27	)
Residential mortgage-backed securities			103,636				(437	)			1,798				(198	)			105,434				(635	)
U.S. states and political subdivisions			1,004				-				871				(61	)			1,875				(61	)
Total available-for-sale		$	108,081			$	(457	)		$	4,131			$	(286	)		$	112,212			$	(743	)

As of June 30, 2026, the Company held 3 securities available-for-sale, which were in a loss position for greater than 12 months. Management believes the unrealized losses on the Company’s debt securities were caused by interest rate changes. The contractual cash flows of those investments are generally guaranteed or supported by an agency or sponsored entity of the U.S. Government. Accordingly, it is expected that the securities would not be settled at a price less than the amortized cost of the Company’s investment. As of June 30, 2026, the Company did not intend to sell and does not believe it will be required to sell securities in an unrealized loss position prior to the recovery of their amortized cost basis. No credit impairment was recorded for those securities in an unrealized loss position for the three and six months ended June 30, 2026 or December 31, 2025, and there was no allowance for credit losses on securities available-for-sale recorded as of June 30, 2026 or December 31, 2025.

The amortized cost and estimated fair value of available-for-sale debt securities as of June 30, 2026 by contractual maturity are shown below. Expected maturities will differ from contractual maturities because the issuers of the securities may have the right to call or prepay obligations with or without call or prepayment penalties.

		*Available-for-sale*
(In thousands)			*Amortized Cost*				*Fair Value*
Due in one year or less		$	-			$	-
Due after one year through five years			-				-
Due after five years through 10 years			424				403
Due after 10 years			4,712				4,726
			5,136				5,129
Debt securities not due at a single maturity date: mortgage-backed securities			229,811				227,067
Total available-for-sale		$	234,947			$	232,196

Debt securities with fair values of $9.9 million and $8.9 million were pledged as of June 30, 2026 and December 31, 2025, respectively, toward certain letters of credit. No debt securities were pledged to secure public deposits as of June 30, 2026 or December 31, 2025.