v3.26.3
INVESTMENT SECURITIES
 9 Months Ended
Sep. 30, 2026
Investments, Debt and Equity Securities [Abstract]  
INVESTMENT SECURITIES INVESTMENT SECURITIES
Our investment portfolio is comprised primarily of U.S. government and SBA agency securities, mortgage-backed securities ("MBS") backed by government-sponsored entities, collateralized mortgage obligations ("CMO"), commercial paper, and municipal tax-exempt securities. The following table summarizes the amortized cost and fair value of investment securities available for sale (“AFS”) and held to maturity (“HTM”) and the corresponding amounts of gross unrealized gains and losses as of the dates indicated:
September 30, 2026Amortized
Cost		Gross
Unrealized
Gains		Gross
Unrealized
Losses		Fair
Value
Available for sale(dollars in thousands)
Government agency securities$18,725 $12 $(561)$18,176 
SBA agency securities19,437 9 (915)18,531 
MBS: Residential95,306 — (8,732)86,574 
MBS: Commercial10,003 — (67)9,936 
CMO: Residential114,623 13 (12,195)102,441 
CMO: Commercial76,949 116 (2,536)74,529 
Commercial paper39,722 — (23)39,699 
Corporate debt securities24,595 14 (1,518)23,091 
Municipal tax-exempt securities12,541 — (4,174)8,367 
Total available for sale$411,901 $164 $(30,721)$381,344 
Held to maturity
Municipal tax-exempt securities$4,179 $— $(376)$3,803 
Total held to maturity$4,179 $— $(376)$3,803 
December 31, 2025Amortized
Cost		Gross
Unrealized
Gains		Gross
Unrealized
Losses		Fair
Value
Available for sale(dollars in thousands)
Government agency securities$22,850 $34 $(179)$22,705 
SBA agency securities21,326 90 (236)21,180 
MBS: Residential91,049 634 (4,505)87,178 
MBS: Commercial5,010 — (33)4,977 
CMO: Residential120,475 760 (8,740)112,495 
CMO: Commercial102,755 183 (2,161)100,777 
Commercial paper19,948 — — 19,948 
Corporate debt securities30,165 75 (1,811)28,429 
Municipal tax-exempt securities12,567 — (3,052)9,515 
Total available for sale$426,145 $1,776 $(20,717)$407,204 
Held to maturity
Municipal tax-exempt securities$4,184 $— $(81)$4,103 
Total held to maturity$4,184 $— $(81)$4,103 
At September 30, 2026 and December 31, 2025, investment securities with a fair value of $45.9 million and $48.7 million were pledged to secure certificates of deposit from the State of California. One security with a fair value of $27,000 and $36,000 at September 30, 2026 and December 31, 2025 was pledged to secure a local agency deposit.
There were no sales of investment securities during the three and nine months ended September 30, 2026 and 2025.
Accrued interest receivable for investment securities at September 30, 2026 and December 31, 2025 totaled $1.5 million and $1.6 million.
The following tables show the amortized cost and fair value of the investment securities portfolio, by expected maturity, as of the dates indicated. However, expected maturities may differ from contractual maturities if borrowers have the right to call or prepay obligations with or without call or prepayment penalties. Accordingly, MBS and CMO are classified in accordance with their estimated average life.
One Year or LessMore than One Year to Five YearsMore than Five Years to Ten YearsMore than Ten YearsTotal
Amortized CostFair ValueAmortized CostFair ValueAmortized CostFair ValueAmortized CostFair ValueAmortized CostFair Value
September 30, 2026(dollars in thousands)
Government agency securities$658 $650 $8,409 $8,292 $9,658 $9,234 $— $— $18,725 $18,176 
SBA agency securities— — 6,134 5,765 13,303 12,766 — — 19,437 18,531 
MBS: Residential— — 19,717 18,894 75,589 67,680 — — 95,306 86,574 
MBS: Commercial4,993 4,947 5,010 4,989 — — — — 10,003 9,936 
CMO: Residential610 604 71,511 68,630 42,502 33,207 — — 114,623 102,441 
CMO: Commercial3,430 3,358 31,366 30,797 42,153 40,374 — — 76,949 74,529 
Commercial paper39,722 39,699 — — — — — — 39,722 39,699 
Corporate debt securities2,003 1,999 11,371 10,948 7,650 7,434 3,571 2,710 24,595 23,091 
Municipal tax-exempt securities— — — — 1,077 820 11,464 7,547 12,541 8,367 
Total AFS$51,416 $51,257 $153,518 $148,315 $191,932 $171,515 $15,035 $10,257 $411,901 $381,344 
Municipal tax-exempt securities$— $— $1,741 $1,633 $2,438 $2,170 $— $— $4,179 $3,803 
Total HTM$— $— $1,741 $1,633 $2,438 $2,170 $— $— $4,179 $3,803 
December 31, 2025
Government agency securities$65 $65 $22,785 $22,640 $— $— $— $— $22,850 $22,705 
SBA agency securities— — 6,496 6,456 14,830 14,724 — — 21,326 21,180 
MBS: Residential— — 26,636 26,537 64,413 60,641 — — 91,049 87,178 
MBS: Commercial— — 5,010 4,977 — — — — 5,010 4,977 
CMO: Residential6,198 6,248 68,422 68,100 45,855 38,147 — — 120,475 112,495 
CMO: Commercial6,629 6,591 51,805 51,365 44,321 42,821 — — 102,755 100,777 
Commercial paper19,948 19,948 — — — — — — 19,948 19,948 
Corporate debt securities4,022 4,006 8,903 8,733 14,650 13,756 2,590 1,934 30,165 28,429 
Municipal tax-exempt securities— — — — 1,081 921 11,486 8,594 12,567 9,515 
Total AFS$36,862 $36,858 $190,057 $188,808 $185,150 $171,010 $14,076 $10,528 $426,145 $407,204 
Municipal tax-exempt securities$— $— $860 $857 $2,817 $2,742 $507 $504 $4,184 $4,103 
Total HTM$— $— $860 $857 $2,817 $2,742 $507 $504 $4,184 $4,103 
The following tables show the fair value and gross unrealized losses of our investment securities, aggregated by investment category and the length of time individual securities have been in a continuous unrealized loss position, as of the dates indicated:
Less than Twelve MonthsTwelve Months or MoreTotal
Fair ValueUnrealized Losses# of IssuancesFair ValueUnrealized Losses# of IssuancesFair ValueUnrealized Losses# of Issuances
September 30, 2026(dollars in thousands)
Government agency securities$9,883 $(433)3 $4,497 $(128)2 $14,380 $(561)5 
SBA agency securities14,129 (659)5 2,541 (256)5 16,670 (915)10 
MBS: Residential63,072 (3,125)19 23,502 (5,607)15 86,574 (8,732)34 
MBS: Commercial9,936 (67)2 — — — 9,936 (67)2 
CMO: Residential51,325 (1,517)15 45,203 (10,678)23 96,528 (12,195)38 
CMO: Commercial4,106 (21)1 47,376 (2,515)21 51,482 (2,536)22 
Commercial paper24,705 (23)4 — — — 24,705 (23)4 
Corporate debt securities2,944 (56)3 15,626 (1,462)16 18,570 (1,518)19 
Municipal tax-exempt securities— — — 8,367 (4,174)11 8,367 (4,174)11 
Total AFS$180,100 $(5,901)52 $147,112 $(24,820)93 $327,212 $(30,721)145 
Municipal tax-exempt securities$1,521 $(109)4 $2,282 $(267)5 $3,803 $(376)9 
Total HTM$1,521 $(109)4 $2,282 $(267)5 $3,803 $(376)9 
Less than Twelve MonthsTwelve Months or MoreTotal
Fair ValueUnrealized Losses# of IssuancesFair ValueUnrealized Losses# of IssuancesFair ValueUnrealized Losses# of Issuances
December 31, 2025(dollars in thousands)
Government agency securities$1,749 $(6)1 $6,572 $(173)3 $8,321 $(179)4 
SBA agency securities7,654 (93)3 2,962 (143)5 10,616 (236)8 
MBS: Residential14,196 (91)4 27,573 (4,414)15 41,769 (4,505)19 
MBS: Commercial4,977 (33)1 — — — 4,977 (33)1 
CMO: Residential3,130 (1)1 53,195 (8,739)24 56,325 (8,740)25 
CMO: Commercial13,947 (31)4 49,366 (2,130)21 63,313 (2,161)25 
Corporate debt securities— — — 22,577 (1,811)24 22,577 (1,811)24 
Municipal tax-exempt securities— — — 9,515 (3,052)11 9,515 (3,052)11 
Total AFS$45,653 $(255)14 $171,760 $(20,462)103 $217,413 $(20,717)117 
Municipal tax-exempt securities$— $— — $3,663 $(81)8 $3,663 $(81)8 
Total HTM$— $— — $3,663 $(81)8 $3,663 $(81)8 
The securities that were in an unrealized loss position at September 30, 2026 and December 31, 2025 were evaluated to determine whether the decline in fair value below the amortized cost basis resulted from a credit loss or other factors. We concluded that the unrealized losses were primarily attributed to yield curve movement. All SBA agency securities, mortgage-backed securities, and collateralized mortgage obligations are issued by government or government sponsored entities and have the support of the U.S. federal government. The issuers have not, to our knowledge, established any cause for default on these securities. We expect to recover the amortized cost basis of our securities and have no present intent to sell and do not expect to be required to sell securities that have declined below their cost before their anticipated recovery. As of September 30, 2026 and December 31, 2025, all of our HTM securities were rated “AA-” or above. Based on this evaluation, no ACL was recorded as of September 30, 2026 and December 31, 2025, against HTM or AFS securities, and there was no provision for credit losses recognized for the three months and nine months ended September 30, 2026 and 2025.