Fair Value Measurements (Tables)
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9 Months Ended |
Sep. 30, 2026 |
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| Fair Value Measurements |
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| Schedule of balance of assets and liabilities which are measured at fair value on a recurring basis |
| | | | | | | | | | | | | | | September 30, 2026 | | | Level 1 | | Level 2 | | Level 3 | | Total | Assets: | | | | | | | | | | | | | Securities available-for-sale | | | | | | | | | | | | | U.S. Treasury | | $ | 148,073 | | $ | - | | $ | - | | $ | 148,073 | U.S. government agencies | | | - | | | 39,109 | | | - | | | 39,109 | U.S. government agencies mortgage-backed | | | - | | | 74,835 | | | - | | | 74,835 | States and political subdivisions | | | - | | | 170,770 | | | 6,502 | | | 177,272 | Collateralized mortgage obligations | | | - | | | 328,790 | | | - | | | 328,790 | Asset-backed securities | | | - | | | 32,248 | | | 5,147 | | | 37,395 | Collateralized loan obligations | | | - | | | 172,331 | | | - | | | 172,331 | Equity securities | | | - | | | 771 | | | - | | | 771 | Loans held-for-sale | | | - | | | 1,407 | | | - | | | 1,407 | Mortgage servicing rights | | | - | | | - | | | 10,690 | | | 10,690 | Interest rate derivatives 1 | | | - | | | 7,009 | | | - | | | 7,009 | Total | | $ | 148,073 | | $ | 827,270 | | $ | 22,339 | | $ | 997,682 | | | | | | | | | | | | | | Liabilities: | | | | | | | | | | | | | Interest rate swap agreements, including risk participation agreements | | $ | - | | $ | 2,027 | | $ | - | | $ | 2,027 | Mortgage banking derivatives | | | - | | | 20 | | | - | | | 20 | Total | | $ | - | | $ | 2,047 | | $ | - | | $ | 2,047 | | | | | | | | | | | | | |
1 Interest rate derivatives include interest rate swaps, a rate cap and risk participation agreements. | | | | | | | | | | | | | | | December 31, 2025 | | | Level 1 | | Level 2 | | Level 3 | | Total | Assets: | | | | | | | | | | | | | Securities available-for-sale | | | | | | | | | | | | | U.S. Treasury | | $ | 165,860 | | $ | - | | $ | - | | $ | 165,860 | U.S. government agencies | | | - | | | 29,176 | | | - | | | 29,176 | U.S. government agencies mortgage-backed | | | - | | | 88,780 | | | - | | | 88,780 | States and political subdivisions | | | - | | | 199,428 | | | 6,947 | | | 206,375 | Collateralized mortgage obligations | | | - | | | 359,305 | | | - | | | 359,305 | Asset-backed securities | | | - | | | 40,966 | | | 4,850 | | | 45,816 | Collateralized loan obligations | | | - | | | 194,464 | | | - | | | 194,464 | Equity securities | | | - | | | 747 | | | - | | | 747 | Loans held-for-sale | | | - | | | 3,645 | | | - | | | 3,645 | Mortgage servicing rights | | | - | | | - | | | 9,459 | | | 9,459 | Interest rate derivatives 1 | | | - | | | 4,321 | | | - | | | 4,321 | Mortgage banking derivatives | | | - | | | 31 | | | - | | | 31 | Total | | $ | 165,860 | | $ | 920,863 | | $ | 21,256 | | $ | 1,107,979 | | | | | | | | | | | | | | Liabilities: | | | | | | | | | | | | | Interest rate swap agreements, including risk participation agreements | | $ | - | | $ | 1,157 | | $ | - | | $ | 1,157 | Total | | $ | - | | $ | 1,157 | | $ | - | | $ | 1,157 |
1 Interest rate derivatives include interest rate swaps, a rate cap and risk participation agreements.
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| Schedule of changes in Level 3 assets and liabilities measured at fair value on a recurring basis |
The changes in Level 3 assets and liabilities measured at fair value on a recurring basis are as follows: | | | | | | | | | | | | | Nine Months Ended September 30, 2026 | | | Securities available-for-sale | | | | | | | | States and | | Mortgage | | | Asset-backed | | Political | | Servicing | | | Securities | | Subdivisions | | Rights | Beginning balance January 1, 2026 | | $ | 4,850 | | $ | 6,947 | | $ | 9,459 | Transfers out of Level 3 | | | - | | | - | | | - | Total gains or losses | | | | | | | | | | Included in earnings | | | - | | | - | | | 814 | Included in other comprehensive income | | | (142) | | | (438) | | | - | Purchases, issuances, sales, and settlements | | | | | | | | | | Purchases | | | 873 | | | - | | | - | Issuances | | | - | | | - | | | 912 | Settlements | | | (434) | | | (7) | | | (495) | Ending balance September 30, 2026 | | $ | 5,147 | | $ | 6,502 | | $ | 10,690 | | | | | | | | | | |
| | | | | | | | | | | | | | Nine Months Ended September 30, 2025 | | | | | Securities available-for-sale | | | | | | | | | States and | | Mortgage | | | | Asset-backed | | Political | | Servicing | | | | Securities | | Subdivisions | | Rights | | Beginning balance January 1, 2025 | | $ | 3,254 | | $ | 11,896 | | $ | 10,374 | | Transfers out of Level 3 | | | - | | | - | | | - | | Total gains or losses | | | | | | | | | | | Included in earnings | | | - | | | - | | | (1,143) | | Included in other comprehensive income | | | (16) | | | (335) | | | - | | Purchases, issuances, sales, and settlements | | | | | | | | | | | Purchases | | | 1,702 | | | - | | | - | | Issuances | | | - | | | - | | | 665 | | Settlements | | | (340) | | | (120) | | | (347) | | Ending balance September 30, 2025 | | $ | 4,600 | | $ | 11,441 | | $ | 9,549 | |
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| Schedule of quantitative information about level 3 fair value measurements |
The following table and commentary present quantitative and qualitative information about Level 3 fair value measurements as of September 30, 2026: | | | | | | | | | | | | | | | | | | | | | | | | Weighted | Measured at fair value | | | | | | | Significant Unobservable | | | | Average | on a recurring basis: | | Fair Value | | Valuation Methodology | | Inputs | | Range of Input | | of Inputs | | | | | | | | | | | | | | States and political subdivisions | | $ | 6,502 | | Discounted Cash Flow | | Discount Rate | | 4.7 - 4.8% | | 4.7 | % | | | | | | | | Liquidity Premium | | 0.5 - 0.5% | | 0.5 | % | | | | | | | | | | | | | | Asset-backed securities | | $ | 5,147 | | Discounted Cash Flow | | Discount Rate | | 6.2 - 10.4% | | 6.7 | % | | | | | | | | | | | | | | Mortgage servicing rights | | $ | 10,690 | | Discounted Cash Flow | | Discount Rate | | 9.0 - 9.0% | | 9.0 | % | | | | | | | | Prepayment Speed | | 5.4 - 24.6% | | 7.5 | % | | | | | | | | | | | | | |
The following table and commentary present quantitative and qualitative information about Level 3 fair value measurements as of December 31, 2025: | | | | | | | | | | | | | | | | | | | | | | | | Weighted | Measured at fair value | | | | | | | Significant Unobservable | | | | Average | on a recurring basis: | | Fair Value | | Valuation Methodology | | Inputs | | Range of Input | | of Inputs | | | | | | | | | | | | | | States and political subdivisions | | $ | 6,947 | | Discounted Cash Flow | | Discount Rate | | 3.5 - 3.6% | | 3.5 | % | | | | | | | | Liquidity Premium | | 0.5 - 0.5% | | 0.5 | % | | | | | | | | | | | | | | Asset-backed securities | | $ | 4,850 | | Discounted Cash Flow | | Discount Rate | | 4.9 - 4.9% | | 4.9 | % | | | | | | | | | | | | | | Mortgage servicing rights | | $ | 9,459 | | Discounted Cash Flow | | Discount Rate | | 9.0 - 9.0% | | 9.0 | % | | | | | | | | Prepayment Speed | | 0.0 - 33.2% | | 8.2 | % |
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| Schedule of assets measured at fair value on a nonrecurring basis |
| | | | | | | | | | | | | | | September 30, 2026 | | | Level 1 | | Level 2 | | Level 3 | | Total | Individually evaluated loans1 | | $ | - | | $ | - | | $ | 20,709 | | $ | 20,709 | Other real estate owned, net2 | | | - | | | - | | | - | | | - | Total | | $ | - | | $ | - | | $ | 20,709 | | $ | 20,709 |
1 Represents carrying value and related write-downs of loans for which adjustments are substantially based on the appraised value of collateral or another form of third-party valuation for collateral-dependent loans, which had a carrying amount of $28.0 million and a valuation allowance of $7.3 million, resulting in an increase of specific allocations within the allowance for credit losses on loans of $837,000 for the nine months ended September 30, 2026. 2 OREO is measured at the lower of carrying or fair value less costs to sell. As of September 30, 2026, the Company is not carrying any OREO. | | | | | | | | | | | | | | | December 31, 2025 | | | Level 1 | | Level 2 | | Level 3 | | Total | Individually evaluated loans1 | | $ | - | | $ | - | | $ | 34,430 | | $ | 34,430 | Other real estate owned, net2 | | | - | | | - | | | 1,427 | | | 1,427 | Total | | $ | - | | $ | - | | $ | 35,857 | | $ | 35,857 |
1 Represents carrying value and related write-downs of loans for which adjustments are substantially based on the appraised value of collateral for collateral-dependent loans and to a lesser extent the discounted cash flow, which had a carrying amount of $40.9 million and a valuation allowance of $6.4 million, resulting in a decrease of specific allocations within the allowance for credit losses on loans of $747,000 for the year December 31, 2025. 2 OREO is measured at the lower of carrying or fair value less costs to sell, and had a net carrying amount of $1.4 million at December 31, 2025, which is made up of the outstanding balance of $2.1 million, net of a valuation allowance of $632,000.
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