INVESTMENT SECURITIES

9 Months Ended

Sep. 30, 2026

Investments, Debt and Equity Securities [Abstract]

At September 30, 2026 and December 31, 2025, all investment securities were classified as AFS. The following table summarizes amortized cost and fair value of AFS securities, the corresponding amounts of gross unrealized gains and losses recognized in AOCI and the ACL at September 30, 2026 and December 31, 2025:


	Amortized Cost		Gross Unrealized Gains		(Gross Unrealized Losses)		Allowance for Credit Losses		Fair Value
September 30, 2026
U.S. Treasury securities	$	15,010	$	—	$	844	$	—	$	14,166
U.S. Government Agencies	1,325		35		—		—		1,360

States and political subdivisions	217,801		—		30,484		—		187,317
GSE residential MBSs	249,039		—		17,448		—		231,591
GSE commercial MBSs	10,813		19		394		—		10,438
GSE residential CMOs	340,352		255		13,697		—		326,910

Non-agency CMOs	80,030		12		3,084		—		76,958


Asset-backed	69,804		305		675		—		69,434
Corporate debt	957		4		—		—		961
Other	313		—		—		—		313
Totals	$	985,444	$	630	$	66,626	$	—	$	919,448
December 31, 2025
U.S. Treasury securities	$	15,016	$	—	$	805	$	—	$	14,211
U.S. Government Agencies	1,746		50		—		—		1,796

States and political subdivisions	218,832		288		16,972		—		202,148
GSE residential MBSs	234,016		3,228		3,141		—		234,103
GSE commercial MBSs	6,081		106		16		—		6,171
GSE residential CMOs	354,954		3,425		4,376		—		354,003

Non-agency CMOs	60,693		363		1,233		—		59,823


Asset-backed	78,610		443		803		—		78,250
Corporate debt	1,947		45		—		—		1,992
Other	243		—		—		—		243
Totals	$	972,138	$	7,948	$	27,346	$	—	$	952,740

The following table summarizes investment securities with unrealized losses at September 30, 2026 and December 31, 2025, aggregated by major security type and the length of time in a continuous unrealized loss position:


	Less Than 12 Months					12 Months or More					Total
	# of Securities	Fair Value		Unrealized Losses		# of Securities	Fair Value		Unrealized Losses		# of Securities	Fair Value		Unrealized Losses
September 30, 2026
U.S. Treasury securities	—	$	—	$	—	2	$	14,166	$	844	2	$	14,166	$	844

States and political subdivisions	19	15,340		673		40	171,977		29,811		59	187,317		30,484
GSE residential MBSs	90	211,929		13,656		9	19,662		3,792		99	231,591		17,448
GSE commercial MBS	4	8,266		336		2	1,045		58		6	9,311		394
GSE residential CMOs	89	231,212		7,744		16	51,018		5,953		105	282,230		13,697
Non-agency CMOs	15	59,545		2,049		4	15,196		1,035		19	74,741		3,084



Asset-backed	2	5,811		10		10	40,174		665		12	45,985		675

Totals	219	$	532,103	$	24,468	83	$	313,238	$	42,158	302	$	845,341	$	66,626
December 31, 2025
U.S. Treasury securities	—	$	—	$	—	2	$	14,211	$	805	2	$	14,211	$	805


States and political subdivisions	2	10,498		199		39	176,757		16,773		41	187,255		16,972
GSE residential MBSs	7	72,981		1,044		8	13,003		2,097		15	85,984		3,141
GSE commercial MBS	2	1,222		16		—	—		—		2	1,222		16
GSE residential CMOs	9	39,588		335		21	87,901		4,041		30	127,489		4,376
Non-agency CMOs	5	21,230		180		4	16,158		1,053		9	37,388		1,233



Asset-backed	2	3,890		29		9	43,168		774		11	47,058		803

Totals	27	$	149,409	$	1,803	83	$	351,198	$	25,543	110	$	500,607	$	27,346

For AFS securities in an unrealized loss position, the Company assesses on a quarterly basis whether it intends to sell, or it is more likely than not that it will be required to sell the investment security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the investment security’s amortized cost basis is written down to fair value through earnings. For AFS securities that do not meet the aforementioned criteria, the Company evaluates the unrealized losses to determine if a security's decline in fair value below its amortized cost basis is due to credit factors. The evaluation is based upon factors such as the creditworthiness of the underlying issuers, performance of the underlying collateral, if applicable, and the level of credit support in the security structure. Management also evaluates other factors and circumstances that may be indicative of a decline in the fair value of the security due to a credit factor. This includes, but is not limited to, an evaluation of the type of security, extent to which the fair value has been less than cost and near-term prospects of the issuer. If this assessment indicates that a credit loss exists, the present value of the expected cash flows of the security is compared to the amortized cost basis of the security. Under the CECL standard, if the present value of the cash flows expected to be collected is less than the amortized cost, an ACL is recorded for the credit loss, which is limited by the amount that the fair value is less than the amortized cost basis. Any additional amount of loss would be due to non-credit factors and is recorded in AOCI, net of taxes. If a credit loss is recognized in earnings, subsequent improvements to the expectation of collectability will be recognized through the ACL. If the fair value of the security increases above its amortized cost, the unrealized gain will be recorded in AOCI, net of taxes, on the consolidated balance sheets.

The Company did not record an ACL on the AFS securities at September 30, 2026 and December 31, 2025. As of these periods, the Company considers the unrealized losses on the AFS securities to be related to fluctuations in market conditions, primarily higher interest rates from the time of the security purchase, and not reflective of deterioration in credit. In addition, the Company maintains that it has the intent and ability to hold these AFS securities until the amortized cost is recovered and it is more likely than not that any of AFS securities in an unrealized loss position would not be required to be sold.

U.S. Treasury Securities. The unrealized losses presented in the table above have been caused by an increase in interest rates from the time these securities were purchased. Management considers the full faith and credit of the U.S. government in determining whether declines in fair value are due to credit factors.

States and Political Subdivisions. The unrealized losses presented in the table above have been caused by a rise in interest rates from the time these securities were purchased. Management evaluates the financial performance of the issuers, including the investment rating, the state of the issuer of the security and other credit support in determining whether declines in fair value are due to credit factors.

GSE Residential CMOs, GSE Residential MBS and GSE Commercial MBS. The unrealized losses presented in the table above have been caused by a widening of spreads and a rise in interest rates from the time these securities were purchased. The contractual terms of these securities do not permit the issuer to settle the securities at a price less than its par value basis.

Non-Agency CMOs. The unrealized losses presented in the table above were caused by a widening of spreads and a rise in interest rates from the time the securities were purchased. In determining whether declines in fair value in these investment securities are due to credit factors, management evaluates credit enhancements and other credit support, the investment rating and delinquencies.

Asset-backed. The unrealized losses presented in the table above were caused by a widening of spreads and a rise in the interest rates from the time the securities were purchased. In determining whether declines in fair value in these investment securities are due to credit factors, management evaluates credit enhancements and other credit support, the investment rating and delinquencies.

The Company does not intend to sell the aforementioned investment securities with unrealized losses and it is more likely than not that the Company will not be required to sell them before recovery of their amortized cost basis, which may be maturity. In addition, the unrealized losses are not credit related. Therefore, the Company has concluded that the unrealized losses for these securities do not require an ACL at September 30, 2026.

The following table summarizes amortized cost and fair value of investment securities by contractual maturity at September 30, 2026. Expected maturities may differ from contractual maturities if issuers have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately.


	Amortized Cost		Fair Value
Due in one year or less	$	5,993	$	5,916
Due after one year through five years	44,966		41,350
Due after five years through ten years	54,039		49,025
Due after ten years	130,408		107,826
CMOs and MBSs	680,234		645,897
Asset-backed	69,804		69,434

Totals	$	985,444	$	919,448

The following table summarizes proceeds from sales of investment securities and gross gains and gross losses for the three and nine months ended September 30, 2026 and 2025:


	Three months ended September 30,				Nine months ended September 30,
	2026		2025		2026		2025
Proceeds from sale of investment securities	$	—	$	41,647	$	—	$	41,647
Gross gains	15		50		72		71
Gross losses	—		—		2		—

During the three and nine months ended September 30, 2026, the Company recorded a net gain of $15 thousand and $70 thousand from mark-to-market activity on an equity security. During the three and nine months ended September 30, 2026, the Company did not sell any investment securities. The Company recorded gains of $50 thousand and $71 thousand for the three and nine months ended September 30, 2025, respectively, which included a gain of $44 thousand from the sale of GSE residential MBS securities with a principal balance of $41.6 million and the remaining balances from mark-to-market activity on an equity security. Investment securities with a fair value of $662.1 million and $556.5 million at September 30, 2026 and December 31, 2025, respectively, were pledged to secure public funds and for other purposes as required or permitted by law. At September 30, 2026 and December 31, 2025, no AFS investment securities holding of any one issuer, other than the U.S. government and its agencies, amounted to greater than 10% of shareholders’ equity.