v3.26.3
Investment Securities
 9 Months Ended
Sep. 30, 2026
Investment Securities [Abstract]  
Investment Securities
(4) Investment Securities

(a) Debt Securities available for sale

The amortized cost and fair value of the debt securities available for sale are as follows:

   
September 30, 2026
  
         
Gross
    
Gross
        
   
Amortized
    
Unrealized
    
Unrealized
    
Fair
  
(dollars in thousands)
  
Cost
    
Gains
    
Losses
    
Value
  
                         
U.S. government sponsored enterprises
  
$
10,000
    
$
-
    
$
127
    
$
9,873
  
State and political subdivisions
    
9
      
-
      
-
      
9
  
Mortgage backed securities and collateralized mortgage obligations - residential
    
220,654
      
-
      
23,966
      
196,688
  
Corporate bonds
    
79,975
      
-
      
2,541
      
77,434
  
Small Business Administration - guaranteed participation securities
    
10,208
      
-
      
902
      
9,306
  
Other
    
690
      
23
      
-
      
713
  
Total Securities Available for Sale
  
$
321,536
    
$
23
    
$
27,536
    
$
294,023
  

   
December 31, 2025
  
         
Gross
    
Gross
        
   
Amortized
    
Unrealized
    
Unrealized
    
Fair
  
(dollars in thousands)
  
Cost
    
Gains
    
Losses
    
Value
  
                         
U.S. government sponsored enterprises
  
$
31,939
    
$
18
    
$
185
    
$
31,772
  
State and political subdivisions
    
9
      
-
      
-
      
9
  
Mortgage backed securities and collateralized mortgage obligations - residential
    
221,611
      
543
      
15,864
      
206,290
  
Corporate bonds
    
59,972
      
99
      
139
      
59,932
  
Small Business Administration - guaranteed participation securities
    
12,427
      
-
      
717
      
11,710
  
Other
    
689
      
16
      
-
      
705
  
 
                                
Total Securities Available for Sale
  
$
326,647
    
$
676
    
$
16,905
    
$
310,418
  

The following table categorizes the debt securities included in the available for sale portfolio as of September 30, 2026, based on the securities’ final maturity. Actual maturities may differ because of securities prepayments and the right of certain issuers to call or prepay their obligations without penalty. Debt securities not due at a single maturity date are presented separately:

   
September 30, 2026
  
   
Amortized
    
Fair
  
(dollars in thousands)
  
Cost
    
Value
  
             
Due in one year or less
  
$
49
    
$
73
  
Due after one year through five years
    
90,625
      
87,956
  
Mortgage backed securities and collateralized mortgage obligations - residential
    
220,654
      
196,688
  
Small Business Administration - guaranteed participation securities
    
10,208
      
9,306
  
   
$
321,536
    
$
294,023
  
Gross unrealized losses on debt securities available for sale and the related fair values aggregated by the length of time that individual securities have been in an unrealized loss position, were as follows:

   
September 30, 2026
  
   
Less than
    
12 months
              
   
12 months
    
or more
    
Total
  
         
Gross
          
Gross
          
Gross
  
   
Fair
    
Unrealized
    
Fair
    
Unrealized
    
Fair
    
Unrealized
  
(dollars in thousands)
  
Value
    
Loss
    
Value
    
Loss
    
Value
    
Loss
  
                                     
U.S. government sponsored enterprises
  
$
9,873
    
$
127
    
$
-
    
$
-
    
$
9,873
    
$
127
  
Mortgage backed securities and collateralized mortgage
obligations - residential
    
49,501
      
2,299
      
147,187
      
21,667
      
196,688
      
23,966
  
Corporate bonds
    
58,502
      
1,490
      
18,932
      
1,051
      
77,434
      
2,541
  
Small Business Administration - guaranteed
participation securities
    
-
      
-
      
9,306
      
902
      
9,306
      
902
  
                                                 
Total
  
$
117,876
    
$
3,916
    
$
175,425
    
$
23,620
    
$
293,301
    
$
27,536
  

   
December 31, 2025
  
   
Less than
    
12 months
              
   
12 months
    
or more
    
Total
  
         
Gross
          
Gross
          
Gross
  
   
Fair
    
Unrealized
    
Fair
    
Unrealized
    
Fair
    
Unrealized
  
(dollars in thousands)
  
Value
    
Loss
    
Value
    
Loss
    
Value
    
Loss
  
 
                                    
U.S. government sponsored enterprises
  
$
1,998
    
$
2
    
$
24,756
    
$
183
    
$
26,754
    
$
185
  
Mortgage backed securities and collateralized mortgage
obligations - residential
    
-
      
-
      
178,551
      
15,864
      
178,551
      
15,864
  
Corporate bonds
    
34,842
      
139
      
-
      
-
      
34,842
      
139
  
Small Business Administration - guaranteed
participation securities
    
-
      
-
      
11,710
      
717
      
11,710
      
717
  
 
                                                
Total
  
$
36,840
    
$
141
    
$
215,017
    
$
16,764
    
$
251,857
    
$
16,905
  

There was no allowance for credit losses recorded for debt securities available for sale during the three and nine months ended September 30, 2026 and 2025.
The proceeds from sales, calls/paydowns and maturities of debt securities available for sale, gross realized gains and gross realized losses from sales, calls/paydowns and maturities during the three and nine months ended September 30, 2026 and 2025 are as follows:

   
Three months ended September 30,
  
(dollars in thousands)
  
2026
    
2025
  
             
Proceeds from sales
  
$
-
    
$
-
  
Proceeds from calls/paydowns
    
10,466
      
30,105
  
Proceeds from maturities
    
10,000
      
10,000
  
Gross realized gains
    
-
      
-
  
Gross realized losses
    
-
      
-
  

   
Nine months ended September 30,
  
   
2026
    
2025
  
(dollars in thousands)
            
             
Proceeds from sales
  
$
-
    
$
-
  
Proceeds from calls/paydowns
    
39,427
      
54,469
  
Proceeds from maturities
    
25,000
      
70,050
  
Gross realized gains
    
-
      
-
  
Gross realized losses
    
-
      
-
  

There were no transfers of debt securities available for sale during the three and nine months ended September 30, 2026 and 2025.

(b) Held to maturity securities

The amortized cost and fair value of the held to maturity securities are as follows:

   
September 30, 2026
  
         
Gross
    
Gross
        
   
Amortized
    
Unrecognized
    
Unrecognized
    
Fair
  
(dollars in thousands)
  
Cost
    
Gains
    
Losses
    
Value
  
                         
Mortgage backed securities and collateralized
mortgage obligations - residential
  
$
3,640
    
$
13
    
$
91
    
$
3,562
  
Total held to maturity
  
$
3,640
    
$
13
    
$
91
    
$
3,562
  

   
December 31, 2025
  
         
Gross
    
Gross
        
   
Amortized
    
Unrecognized
    
Unrecognized
    
Fair
  
(dollars in thousands)
  
Cost
    
Gains
    
Losses
    
Value
  
                         
Mortgage backed securities and collateralized
mortgage obligations - residential
  
$
4,339
    
$
90
    
$
40
    
$
4,389
  
Total held to maturity
  
$
4,339
    
$
90
    
$
40
    
$
4,389
  
The following table categorizes the debt securities included in the held to maturity portfolio as of September 30, 2026, based on the securities’ final maturity.   Actual maturities may differ because of securities prepayments and the right of certain issuers to call or prepay their obligations without penalty.  Debt securities not due at a single maturity date are presented separately:

   
September 30, 2026
  
(dollars in thousands)
  
Amortized
    
Fair
  
   
Cost
    
Value
  
Mortgage backed securities and collateralized
mortgage obligations - residential
  
$
3,640
    
$
3,562
  
   
$
3,640
    
$
3,562
  

All held to maturity securities are held at amortized cost on the financial statements.

Gross unrecognized losses on held to maturity securities and the related fair values aggregated by the length of time that individual securities have been in an unrecognized loss position, were as follows:

   
September 30, 2026
  
   
Less than
    
12 months
              
(dollars in thousands)
  
12 months
    
or more
    
Total
  
         
Gross
          
Gross
          
Gross
  
   
Fair
    
Unrec.
    
Fair
    
Unrec.
    
Fair
    
Unrec.
  
   
Value
    
Loss
    
Value
    
Loss
    
Value
    
Loss
  
Mortgage backed securities and collateralized
mortgage obligations - residential
  
$
1,384
    
$
33
    
$
1,089
    
$
58
    
$
2,473
    
$
91
  
                                                 
Total
  
$
1,384
    
$
33
    
$
1,089
    
$
58
    
$
2,473
    
$
91
  

   
December 31, 2025
  
   
Less than
    
12 months
              
(dollars in thousands)
  
12 months
    
or more
    
Total
  
         
Gross
          
Gross
          
Gross
  
   
Fair
    
Unrec.
    
Fair
    
Unrec.
    
Fair
    
Unrec.
  
   
Value
    
Loss
    
Value
    
Loss
    
Value
    
Loss
  
Mortgage backed securities and collateralized
mortgage obligations - residential
  
$
123
    
$
-
    
$
1,485
    
$
40
    
$
1,608
    
$
40
  
                                                 
Total
  
$
123
    
$
-
    
$
1,485
    
$
40
    
$
1,608
    
$
40
  

There were no sales or transfers of held to maturity securities during the three and nine months ended September 30, 2026 and 2025.

There was no allowance for credit losses recorded for held to maturity securities as of September 30, 2026 and December 31, 2025.  There was no credit loss expense recorded for held to maturity securities for the three and nine months ended September 30, 2026 and 2025.  As of September 30, 2026, there were no securities on non-accrual status and all securities were performing in accordance with contractual terms.

(c) Equity Securities

During the second quarter of 2026, TrustCo recognized an $844 thousand unrealized gain on equity securities resulting from the conversion of Visa Class B-2 shares into a combination of Visa Class B‑3 and Visa Class C shares and the fair-value recognition of the Class C shares received.  The Company sold all of its Visa Class C shares in the third quarter of 2026 and recorded an additional gain of $56 thousand, thus resulting in no remaining carrying value on the Company’s Statement of Financial Condition as of September 30, 2026.  The Company originally obtained the Visa Class B shares in 2008.
(d) Securities in an unrealized loss position

As of September 30, 2026, the Company’s securities portfolio included certain securities which were in an unrealized loss position, and are discussed below.

U.S. government sponsored enterprises:

 In the case of unrealized losses on U.S. government sponsored enterprises, because the decline in fair value is attributable to changes in interest rates, and not credit quality, and because the Company does not have the intent to sell these securities and it is likely that it will not be required to sell the securities before their anticipated recovery, the securities are investment grade rated and there were no material underlying credit downgrades during the third quarter of 2026. As of September 30, 2026, two out of two securities were in an unrealized loss position.  All securities are performing.

Mortgage-backed securities and collateralized mortgage obligations – residential:

 At September 30, 2026, all mortgage-backed securities and collateralized mortgage obligations held by the Company were issued by U.S. government sponsored entities and agencies, primarily Ginnie Mae, Fannie Mae and Freddie Mac, institutions which the government has affirmed its commitment to support.  Because the decline in fair value is attributable to changes in interest rates, and not credit quality, and because the Company does not have the intent to sell these securities and it is likely that it will not be required to sell the securities before their anticipated recovery, the securities are investment grade rated and there were no material underlying credit downgrades during the third quarter of 2026. As of September 30, 2026, 150 out of 163 securities were in an unrealized loss position.  All securities are performing.

Small Business Administration (SBA) - guaranteed participation securities:

At September 30, 2026, all of the SBA securities held by the Company were issued and guaranteed by the U.S. Small Business Administration.  Because the decline in fair value is attributable to changes in interest rates, and not credit quality, and because the Company does not have the intent to sell these securities and it is likely that it will not be required to sell the securities before their anticipated recovery, the securities are investment grade rated and there were no material underlying credit downgrades during the third quarter of 2026. As of September 30, 2026, eight out of eight securities were in an unrealized loss position. All securities are performing.

Corporate Bonds:

 At September 30, 2026, corporate bonds held by the Company are investment grade quality.  Because the decline in fair value is attributable to changes in interest rates, and not credit quality, and because the Company does not have the intent to sell these securities and it is likely that it will not be required to sell the securities before their anticipated recovery, the securities are investment grade rated and there were no material underlying credit downgrades during the third quarter of 2026. As of September 30, 2026, 13 out of 13 securities were in an unrealized loss position. All securities are performing.