The tables below present a summary of the Company's derivative financial instruments, notional amounts and fair values for the periods presented:


	As of December 31, 2024
(Dollars in thousands)	Asset Notional Amount		Asset Derivatives(1)(2)		Liability Notional Amount		Liability Derivatives(1)(2)
Derivatives designated as hedging instruments
Interest-rate positions:
Interest-rate swaps - loans	$	—	$	—	$	100,000	$	336
Total cash flow hedge interest-rate swaps	$	—	$	—	$	100,000	$	336

Derivatives not subject to hedge accounting
Customer related positions:
Loan level derivatives - pay floating, receive fixed	$	—	$	—	$	3,212	$	321
Loan level derivatives - pay fixed, receive floating	3,212		321		—		—
Risk participation agreements sold	—		—		46,387		25
Total derivatives not subject to hedge accounting	$	3,212	$	321	$	49,599	$	346


	As of December 31, 2023
(Dollars in thousands)	Asset Notional Amount		Asset Derivatives(1)(2)		Liability Notional Amount		Liability Derivatives(1)(2)
Derivatives designated as hedging instruments
Interest-rate positions:
Interest-rate swaps - loans	$	—	$	—	$	100,000	$	760
Total cash flow hedge interest-rate swaps	$	—	$	—	$	100,000	$	760

Derivatives not subject to hedge accounting
Customer related positions:
Loan level derivatives - pay floating, receive fixed	$	—	$	—	$	7,524	$	630
Loan level derivatives - pay fixed, receive floating	7,524		630		—		—
Risk participation agreements sold	—		—		46,910		65
Total back-to-back interest-rate swaps	$	7,524	$	630	$	54,434	$	695

(2) The assets and liabilities related to the pay fixed, receive floating interest-rate contracts are subject to a master netting agreement and are presented net in the Consolidated Balance Sheet.

The Company may utilize various interest rate derivatives as hedging instruments against interest rate risk associated with the Company’s loan portfolio. Each interest rate swap agreement was designated as a fair value hedge and involves the net settlement of receiving floating-rate payments from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. At December 31, 2024 and December 31, 2023, the Company had three pay fixed, receive float, interest rate swap agreements with a combined notional value of $100.0 million.

The table below presents the carrying amount of hedged items and cumulative fair value hedging basis adjustments for the periods presented:


		As of December 31, 2024				December 31, 2023
(Dollars in thousands)	Balance Sheet Location of Hedged Item	Carrying Amount of Hedged Assets		Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets		Carrying Amount of Hedged Assets		Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets
Interest-rate swaps - loans	Loans	$	100,305	$	305	$	100,755	$	755

The table below presents the gains (losses) from interest rate derivatives accounted for as fair value hedges and the related hedged items during the periods indicated:


		Year ended
(Dollars in thousands)	Affected Income Statement Line Item	December 31, 2024		December 31, 2023
Derivatives designated as fair value hedges:
Fair value adjustments on derivatives	Net interest income	$	424	$	(760)
Fair value adjustments on hedged instrument	Net interest income	(451)		755
Total		$	(27)	$	(5)

The Company has a "Back-to-Back Swap" program whereby the Bank enters into an interest-rate swap with qualified commercial banking customers and simultaneously enters into equal and opposite interest-rate swap with a swap counterparty. The customer interest-rate swap agreement allows commercial banking customers to convert a floating-rate loan payment to a fixed-rate payment.

Each Back-to-Back swap consists of two interest-rate swaps (a customer swap and offsetting counterparty swap) and amounted to a total number of two interest-rate swaps outstanding at December 31, 2024 and four outstanding at December 31, 2023. As a result of this offsetting relationship, there were no net gains or losses recognized in income on Back-to-Back swaps during the years ended December 31, 2024, 2023, or 2022.

Interest-rate swaps with the counterparty are subject to master netting agreements, while interest-rate swaps with customers are not. At December 31, 2024 and December 31, 2023, all the back-to-back swaps with the counterparty were in asset positions, therefore there was no netting reflected in the Company's Consolidated Balance Sheets as of the respective dates.

The Company enters into RPAs for which the Company has assumed credit risk for customers' performance under interest-rate swap agreements related to the customers' commercial loan and receives fee income commensurate with the risk assumed. The RPAs and the customers' loan are secured by the same collateral.

By using derivative financial instruments, the Company exposes itself to counterparty credit risk. Credit risk is the risk of failure by the counterparty to perform under the terms of the derivative contract. The credit risk in derivative instruments is mitigated by entering into transactions with highly rated counterparties that management believes to be creditworthy. As of December 31, 2024, the Company had two active interest-rate swap institutional counterparties both of which had investment grade credit ratings.

The Company's interest-rate swaps with counterparties contain credit-risk-related contingent provisions. These provisions provide the counterparty with the right to terminate its derivative positions and require the Company to settle its obligations under the agreements if the Company defaults on certain of its indebtedness.

As of December 31, 2024 and December 31, 2023, the Company had credit risk exposure relating to interest-rate swaps with counterparties of $321 thousand and $492 thousand, respectively, and cash posted by counterparties amounted to $120 thousand and $590 thousand at December 31, 2024 and December 31, 2023, respectively.

The Company has minimum collateral posting thresholds with certain of its derivative counterparties, and as of December 31, 2024 and December 31, 2023, cash collateral posted by the Company amounted to $480 thousand and $570 thousand, respectively.

As of December 31, 2024, the fair value of derivatives related to these agreements was at a net liability position of $11 thousand, which excludes any adjustment for nonperformance risk.