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Fair Value of Assets and liabilities (Tables)
 9 Months Ended
Sep. 30, 2024
Fair Value Disclosures [Abstract]  
Summary of Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following tables present the Company’s fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as of September 30, 2024 and December 31, 2023.

September 30, 2024
(Dollars in thousands)

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing deposits

 

$

—

 

 

$

1,250

 

 

$

—

 

 

$

1,250

 

Investment securities (1)

 

 

—

 

 

 

56,754

 

 

 

—

 

 

 

56,754

 

Equity securities

 

 

1,785

 

 

 

—

 

 

 

—

 

 

 

1,785

 

Total

 

$

1,785

 

 

$

58,004

 

 

$

—

 

 

$

59,789

 
(1)
Total unrealized gain of $1.5 million and unrealized loss of less than $1.4 million, net of tax, related to these assets was included in other comprehensive income for the three and nine months ended September 30, 2024.

December 31, 2023
(Dollars in thousands)

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing deposits

 

$

—

 

 

$

1,250

 

 

$

—

 

 

$

1,250

 

Investment securities (1)

 

 

—

 

 

 

54,282

 

 

 

—

 

 

 

54,282

 

Equity securities

 

 

1,748

 

 

 

—

 

 

 

—

 

 

 

1,748

 

Total

 

$

1,748

 

 

$

55,532

 

 

$

—

 

 

$

57,280

 
(1)
Total unrealized losses of $0.3 million, net of tax, related to these assets was included in other comprehensive loss for the year ended December 31, 2023.
Summary of Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis

The following tables present the Company’s fair value hierarchy for those assets and liabilities measured at fair value on a non-recurring basis as of September 30, 2024 and December 31, 2023.

September 30, 2024
(Dollars in thousands)

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Equity investments

 

$

—

 

 

$

—

 

 

$

9,897

 

 

$

9,897

 

Nonaccrual loans

 

 

—

 

 

 

—

 

 

 

23,985

 

 

 

23,985

 

Loan collateral in process of foreclosure

 

 

—

 

 

 

—

 

 

 

8,818

 

 

 

8,818

 

Total

 

$

—

 

 

$

—

 

 

$

42,700

 

 

$

42,700

 

 

December 31, 2023
(Dollars in thousands)

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Equity investments

 

$

—

 

 

$

—

 

 

$

11,430

 

 

$

11,430

 

Nonaccrual loans

 

 

—

 

 

 

—

 

 

 

25,974

 

 

 

25,974

 

Loan collateral in process of foreclosure

 

 

—

 

 

 

—

 

 

 

11,772

 

 

 

11,772

 

Total

 

$

—

 

 

$

—

 

 

$

49,176

 

 

$

49,176

 
Summary of Valuation Techniques and Significant Unobservable Inputs Used in Non-Recurring Level 3 Fair Value Measurements of Assets and Liabilities

The valuation techniques and significant unobservable inputs used in non-recurring level 3 fair value measurements of assets and liabilities as of September 30, 2024 and December 31, 2023.

(Dollars in thousands except per share amounts)

 

Fair Value
at September 30, 2024

 

 

Valuation Techniques

 

Unobservable Inputs

 

Range
(Weighted Average)

Equity investments

 

$

9,624

 

 

Investee financial analysis

 

Financial condition and operating performance of the borrower (1)

 

N/A

 

 

 

 

 

 

 

Collateral support

 

N/A

 

 

 

273

 

 

Precedent market transaction

 

Offering price

 

$8.73 / share

Nonaccrual loans

 

 

23,985

 

 

Market approach

 

Historical and actual loss experience

 

0.00% - 58.96%

 

 

 

 

 

 

 

Transfer prices (2)

 

$0.0 - 79.5

 

 

 

 

 

 

 

Collateral value

 

N/A

Loan collateral in process of foreclosure

 

 

8,818

 

 

Market approach

 

Transfer prices (2)

 

$0.0 - 79.5

 

 

 

 

 

 

 

Collateral value (3)

 

$2.3 - $49.1
(1)
Includes projections based on revenue, EBITDA, leverage, and liquidation amounts. These assumptions are based on a variety of factors, including economic conditions, industry, and market developments, market valuations of comparable companies, and company-specific developments, including exit strategies and realization opportunities.
(2)
Represents amount net of liquidation costs.
(3)
Relates to the recreation loan portfolio.

(Dollars in thousands except per share amounts)

 

Fair Value
at December 31, 2023

 

 

Valuation Techniques

 

Unobservable Inputs

 

Range
(Weighted Average)

Equity investments

 

$

11,157

 

 

Investee financial analysis

 

Financial condition and operating performance of the borrower (1)

 

N/A

 

 

 

 

 

 

 

Collateral support

 

N/A

 

 

 

273

 

 

Precedent market transaction

 

Offering price

 

$8.73 / share

Nonaccrual loans

 

 

25,974

 

 

Market approach

 

Historical and actual loss experience

 

0.00% - 28.48%

 

 

 

 

 

 

 

Transfer prices (2)

 

$0.0 - $79.5

 

 

 

 

 

 

 

Collateral value

 

N/A

Loan collateral in process of foreclosure

 

 

11,772

 

 

Market approach

 

Transfer prices (2)

 

$0.0 - $79.5

 

 

 

 

 

 

 

Collateral value (3)

 

$2.3 - $45.0
(1)
Includes projections based on revenue, EBITDA, leverage, and liquidation amounts. These assumptions are based on a variety of factors, including economic conditions, industry, and market developments, market valuations of comparable companies, and company-specific developments, including exit strategies and realization opportunities.
(2)
Represents amount net of liquidation costs.
(3)
Relates to the recreation loan portfolio.