Securities

9 Months Ended

Sep. 30, 2026

Note 3: Securities

The following tables present the amortized cost and estimated fair value of securities with gross unrealized gains and losses at September 30, 2026 and December 31, 2025:


		September 30, 2026
					Gross			Gross
		Amortized			Unrealized			Unrealized
(dollars in thousands)		Cost			Gains			Losses			Fair Value
Securities Available for Sale:
Municipal Bonds		$	319,141		$	51		$	(40,932)		$	278,260
Mortgage-Backed Securities			228,684			24			(19,382)			209,326
Corporate Securities			81,973			1,572			(2,459)			81,086
U.S. Government Agency Securities			6,256			86			(20)			6,322
Asset-Backed Securities			23,729			—			(10)			23,719
Total Securities Available for Sale		$	659,783		$	1,733		$	(62,803)		$	598,713


		December 31, 2025
					Gross			Gross
		Amortized			Unrealized			Unrealized
(dollars in thousands)		Cost			Gains			Losses			Fair Value
Securities Available for Sale:
U.S. Treasury Securities		$	155,863		$	—		$	(9,657)		$	146,206
Municipal Bonds			242,995			8,686			(12,513)			239,168
Mortgage-Backed Securities			252,291			3,442			(10,061)			245,672
Corporate Securities			93,080			1,958			(2,631)			92,407
U.S. Government Agency Securities			8,664			73			(30)			8,707
Asset-Backed Securities			44,298			20			(37)			44,281
Total Securities Available for Sale		$	797,191		$	14,179		$	(34,929)		$	776,441

Securities with a carrying value of $96.2 million and $254.3 million were pledged to secure borrowing capacity at the Federal Reserve Discount Window as of September 30, 2026 and December 31, 2025, respectively.

The following tables present the fair value and gross unrealized losses of securities with unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at September 30, 2026 and December 31, 2025:


				Less Than 12 Months						12 Months or Greater						Total
		Number of					Unrealized						Unrealized						Unrealized
(dollars in thousands, except number of holdings)		Holdings		Fair Value			Losses			Fair Value			Losses			Fair Value			Losses
September 30, 2026
Municipal Bonds		320		$	187,693		$	(23,279)		$	86,588		$	(17,653)		$	274,281		$	(40,932)
Mortgage-Backed Securities		136			104,398			(5,819)			97,743			(13,563)			202,141			(19,382)
Corporate Securities		39			20,314			(567)			29,499			(1,892)			49,813			(2,459)
U.S. Government Agency Securities		21			790			(7)			1,098			(13)			1,888			(20)
Asset-Backed Securities		7			18,995			(6)			435			(4)			19,430			(10)
Total Securities Available for Sale		523		$	332,190		$	(29,678)		$	215,363		$	(33,125)		$	547,553		$	(62,803)


				Less Than 12 Months						12 Months or Greater						Total
		Number of					Unrealized						Unrealized						Unrealized
(dollars in thousands, except number of holdings)		Holdings		Fair Value			Losses			Fair Value			Losses			Fair Value			Losses
December 31, 2025
U.S. Treasury Securities		2		$	—		$	—		$	146,206		$	(9,657)		$	146,206		$	(9,657)
Municipal Bonds		185			22,430			(354)			94,839			(12,159)			117,269			(12,513)
Mortgage-Backed Securities		108			4,701			(14)			110,265			(10,047)			114,966			(10,061)
Corporate Securities		45			10,341			(68)			39,318			(2,563)			49,659			(2,631)
U.S. Government Agency Securities		25			800			(3)			1,884			(27)			2,684			(30)
Asset-Backed Securities		7			13,024			(31)			6,150			(6)			19,174			(37)
Total Securities Available for Sale		372		$	51,296		$	(470)		$	398,662		$	(34,459)		$	449,958		$	(34,929)

At September 30, 2026 and December 31, 2025, 523 and 372 debt securities had unrealized losses with aggregate depreciation of approximately 10.3% and 7.2%, respectively, from the Company’s amortized cost. These unrealized losses have not been recognized into income because management does not intend to sell these securities, and it is not more likely than not it will be required to sell the securities before recovery of its amortized cost basis. Furthermore, the unrealized losses are primarily due to changes in interest rates and other market conditions and were not reflective of credit events. To make this determination, consideration is given to such factors as the credit rating of the issuer, level of credit enhancement, changes in credit ratings, market conditions such as current interest rates, any adverse conditions specific to the security, and delinquency status on contractual payments. As of September 30, 2026 and December 31, 2025, there was no allowance for credit losses carried on the Company’s securities portfolio.

Accrued interest receivable on securities, which is recorded within accrued interest on the balance sheet, totaled $3.8 million and $6.2 million at September 30, 2026 and December 31, 2025, respectively, and was excluded from the estimate of credit losses.

The Company has entered into fair value hedging transactions to mitigate the impact of changing interest rates on the fair value of securities within the portfolio. See Note 6 – Derivative Instruments and Hedging Activities for additional information.

There were no net realized gains or losses as a result of sales from the securities portfolio for the three months ended September 30, 2026. There was a $7.3 million net realized gain as a result of sales from the securities portfolio for the nine months ended September 30, 2026, which included a net gain of $10.4 million recorded on the termination of fair value hedges on treasury and municipal securities.

The following table presents a summary of the amortized cost and estimated fair value of debt securities by the earlier of expected call date or contractual maturity as of September 30, 2026. Call date is used when a call of the debt security is expected, as determined by the Company when the security has a market value above its amortized cost. Contractual maturities will differ from expected maturities for mortgage-backed, U.S. government agency securities and asset-backed securities because borrowers may have the right to call or prepay obligations without penalties.


(dollars in thousands)		Amortized Cost			Fair Value
September 30, 2026
Due in One Year or Less		$	14,061		$	15,274
Due After One Year Through Five Years			62,206			60,095
Due After Five Years Through 10 Years			119,182			103,399
Due After 10 Years			205,665			180,578
Subtotal			401,114			359,346
Mortgage-Backed Securities			228,684			209,326
U.S. Government Agency Securities			6,256			6,322
Asset-Backed Securities			23,729			23,719
Totals		$	659,783		$	598,713

The following table presents a summary of the proceeds from sales of securities available for sale, as well as gross gains and losses, for the three and nine months ended September 30, 2026 and 2025:


		Three Months Ended						Nine Months Ended
		September 30,						September 30,
(dollars in thousands)		2026			2025			2026			2025
Proceeds From Sales of Securities		$	—		$	5,112		$	208,501		$	64,707
Gross Gains on Sales			—			59			6,190			543
Gross Losses on Sales			—			—			(9,342)			(9)