SECURITIES

9 Months Ended

Sep. 30, 2026

3. SECURITIES

Securities available for sale are summarized as follows as of the dates presented below (dollars in thousands):


	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Allowance for Credit Losses		Fair Value
September 30, 2026
Available for sale:
State and municipal	$	196,634	$	1	$	(37,810	)	$	-	$	158,825
Residential mortgage-backed securities		283,995		-		(54,995	)		-		229,000
Commercial mortgage-backed securities		53,264		-		(5,923	)		-		47,341
Commercial collateralized mortgage obligations		66,233		5		(138	)		-		66,100
Asset-backed and other amortizing securities		12,630		-		(1,332	)		-		11,298
Other securities		5,612		252		(81	)		-		5,783
	$	618,368	$	258	$	(100,279	)	$	-	$	518,347

December 31, 2025
Available for sale:
State and municipal	$	199,417	$	388	$	(23,500	)	$	-	$	176,305
Residential mortgage-backed securities		302,711		130		(42,081	)		-		260,760
Commercial mortgage-backed securities		48,769		-		(3,983	)		-		44,786
Commercial collateralized mortgage obligations		67,708		77		(188	)		-		67,597
Asset-backed and other amortizing securities		13,972		-		(840	)		-		13,132
Other securities		5,000		-		(40	)		-		4,960
	$	637,577	$	595	$	(70,632	)	$	-	$	567,540

The amortized cost and estimated fair value of securities at September 30, 2026 are presented below by contractual maturity (dollars in thousands). Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations. Declining-balance securities are shown separately since they are not due at a single maturity date.


	Available for Sale
	Amortized Cost		Fair Value
Within 1 year	$	490	$	491
After 1 year through 5 years		4,129		4,060
After 5 years through 10 years		19,467		18,229
After 10 years		178,160		141,828
Declining-balance securities		416,122		353,739
	$	618,368	$	518,347

At both September 30, 2026 and December 31, 2025, there were no holdings of securities of any one issuer, other than the U.S. government, its agencies, or its sponsored enterprises, in an amount greater than 10% of stockholders’ equity.

Securities with a carrying value of approximately $509.2 million and $413.7 million at September 30, 2026 and December 31, 2025, respectively, were pledged to collateralize public deposits and for other purposes as required or permitted by law.

The following table segregates securities with unrealized losses at the dates indicated, by the duration they have been in a loss position for which an allowance for credit losses has not been recorded (dollars in thousands):


	Less than 12 Months				12 Months or More				Total
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
September 30, 2026
State and municipal	$	6,985	$	299	$	148,009	$	37,511	$	154,994	$	37,810
Residential mortgage-backed securities		13,000		560		216,000		54,435		229,000		54,995
Commercial mortgage-backed securities		8,607		429		38,734		5,494		47,341		5,923
Commercial collateralized mortgage obligations		38,541		138		-		-		38,541		138
Asset-backed and other amortizing securities		-		-		11,299		1,332		11,299		1,332
Other securities		2,319		81		-		-		2,319		81
	$	69,452	$	1,507	$	414,042	$	98,772	$	483,494	$	100,279

December 31, 2025
State and municipal	$	205	$	-	$	165,618	$	23,500	$	165,823	$	23,500
Residential mortgage-backed securities		3,132		48		249,710		42,033		252,842		42,081
Commercial mortgage-backed securities		3,503		7		41,284		3,976		44,787		3,983
Commercial collateralized mortgage obligations		63,210		188		-		-		63,210		188
Asset-backed and other amortizing securities		-		-		13,132		840		13,132		840
Other securities		-		-		4,961		40		4,961		40
	$	70,050	$	243	$	474,705	$	70,389	$	544,755	$	70,632

There were 139 securities with an unrealized loss at September 30, 2026, generally due to a continuation of the elevated market interest rate environment. Management evaluates securities available for sale (“AFS”) in unrealized loss positions to determine whether the impairment is due to credit-related factors or non-credit related factors. Consideration is given to the extent to which the fair value is less than cost, the financial condition and near-term prospects of the issuer, and the intent and ability of the Company to retain its investment in the security for a period of time sufficient to allow for the anticipated recovery in fair value. Management does not have the intent to sell any of the securities in an unrealized loss position and believes that it is not likely that the securities will have to be sold before a recovery of cost. The fair value of these securities is expected to recover as the securities approach their maturity date or repricing date or if market yields for such investments decline. Accordingly, as of September 30, 2026, management believes the unrealized loss positions detailed in the previous table are due to non-credit related factors, including changes in interest rates and other market conditions, and therefore no ACL for AFS securities or losses have been recognized or realized in the consolidated financial statements.