SECURITIES

6 Months Ended

Jun. 30, 2026

NOTE 3 – SECURITIES

The amortized cost and fair value of securities available for sale at June 30, 2026 and December 31, 2025 are as follows (in thousands):


					Gross			Gross
		Amortized			Unrealized			Unrealized
		Cost			Gains			Losses			Fair Value
June 30, 2026
U.S. Treasury Securities		$	29,635		$	—		$	(50)		$	29,585
State and political subdivisions			27,904			32			(395)			27,541
Mortgage-backed securities (“MBSs”) – residential			51,617			184			(669)			51,132
Collateralized mortgage obligations (“CMOs”)			2,875			—			(77)			2,798
Corporate securities			3,991			—			(14)			3,977
Total securities available for sale		$	116,022		$	216		$	(1,205)		$	115,033


					Gross			Gross
		Amortized			Unrealized			Unrealized
		Cost			Gains			Losses			Fair Value
December 31, 2025
U.S. Treasury Securities		$	2,955		$	6		$	—		$	2,961
State and political subdivisions			12,204			—			(185)			12,019
Mortgage-backed securities (“MBSs”) – residential			45,721			708			(382)			46,047
Collateralized mortgage obligations (“CMOs”)			97			—			(44)			53
Corporate securities			5,484			—			(2)			5,482
Total securities available for sale		$	66,461		$	714		$	(613)		$	66,562

Immediately after the merger with NBC, the Company sold $50.2 million AFS investments that were acquired from NBC, with no gross gains or losses realized upon sale. There were no other sales during the three and six months ended June 30, 2026. None were sold during the year ended December 31, 2025. There were no securities called during the six months ended June 30, 2026 and none during the year ended December 31, 2025.

NOTE 3 – SECURITIES (Continued)

As of June 30, 2026, the contractual maturity of debt securities available for sale (MBSs and CMOs are shown separately) at amortized cost and approximate fair value is as follows (in thousands):


		Amortized
		Cost			Fair Value
Within one year		$	33,260		$	33,203
After one year to five years			17,443			17,286
After five years to ten years			10,490			10,268
Over ten years			337			345
Total debt securities			61,530			61,102
MBSs and CMOs			54,492			53,931
Total		$	116,022		$	115,033

Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

The carrying value of securities available for sale pledged to secure borrowings, deposits, and for other purposes was $50.9 million and $60.6 million at June 30, 2026 and December 31, 2025, respectively. At June 30, 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 shareholders’ equity.

The following table provides the gross unrealized losses and fair value, aggregated by investment category and length of time individual securities have been in a continuous unrealized loss position at June 30, 2026 and December 31, 2025 (in thousands).


		Less than 12 Months						12 Months or longer						Total
					Gross						Gross
					Unrealized						Unrealized						Unrealized
		Fair Value			Losses			Fair Value			Losses			Fair Value			Losses
June 30, 2026
U.S. Treasury Securities		$	29,585		$	(50)		$	—		$	—		$	29,585		$	(50)
State and political subdivisions			15,006			(231)			5,956			(164)			20,962			(395)
MBSs			18,729			(149)			15,108			(520)			33,837			(669)
CMOs			2,751			(25)			47			(52)			2,798			(77)
Corporate Securities			2,476			(14)			—			—			2,476			(14)
		$	68,547		$	(469)		$	21,111		$	(736)		$	89,658		$	(1,205)


		Less than 12 Months						12 Months or longer						Total
		Estimated			Unrealized			Estimated			Unrealized			Estimated			Unrealized
		Fair Value			Losses			Fair Value			Losses			Fair Value			Losses
December 31, 2025
Treasury		$	—		$	—		$	—		$	—		$	—		$	—
State and political subdivisions			—			—			11,816			(185)			11,816			(185)
MBSs			—			—			16,133			(382)			16,133			(382)
CMOs			—			—			53			(44)			53			(44)
Corporate Securities			2,482			(2)			—			—			2,482			(2)
		$	2,482		$	(2)		$	28,002		$	(611)		$	30,484		$	(613)

Management has assessed the securities available for sale that were in an unrealized loss position at June 30, 2026 and December 31, 2025, and determined that the decline in fair value is driven by changes in market interest rates and credit spreads, not changes in credit quality. There were no defaults on principal or interest payments, and no interest payments were deferred. Based on management’s analysis of each individual security, the issues appear to have the ability to meet debt service requirements over the life of the security. The Company had no allowance for credit losses on securities available for sale at June 30, 2026 and December 31, 2025. At June 30, 2026 the Company does not intend to sell, nor is it more likely than not that the Company will be required to sell, any securities before recovery of its amortized cost basis, which may be maturity.