XML 26 R11.htm IDEA: XBRL DOCUMENT

Investment Securities

12 Months Ended

Dec. 31, 2025

Investment Securities [Abstract]

Investment Securities

Note 2—Investment Securities

The amortized cost, fair values, and unrealized gains and losses of the securities available-for-sale are as follows:

						Gross Unrealized
(Dollars in thousands)		Amortized Cost				Gains				Losses				Fair Value
As of December 31, 2025
U.S. Government-sponsored securities		$	2,046			$	2			$	10			$	2,038
Mortgage-backed securities⁽¹⁾			834,820				9,140				17,720				826,240
Commercial mortgage-backed obligations⁽¹⁾			1,231				22				-				1,253
Collateralized mortgage obligations⁽¹⁾			21,087				5				362				20,730
Municipal securities			66,142				4,703				-				70,845
Corporate securities			29,567				171				-				29,738
Other			310				-				-				310
Total available-for-sale securities		$	955,203			$	14,043			$	18,092			$	951,154

⁽¹⁾All mortgage-backed securities and collateralized mortgage obligations were issued by an agency or government sponsored entity of the U.S. Government.

						Gross Unrealized
(Dollars in thousands)		Amortized Cost				Gains				Losses				Fair Value
As of December 31, 2024
U.S. Government-sponsored securities		$	2,657			$	4			$	17			$	2,644
Mortgage-backed securities⁽¹⁾			466,302				464				26,908				439,858
Commercial mortgage-backed obligations⁽¹⁾			1,228				-				16				1,212
Collateralized mortgage obligations⁽¹⁾			5,653				-				156				5,497
Corporate securities			14,800				56				-				14,856
Other			352				-				5				347
Total available-for-sale securities		$	490,992			$	524			$	27,102			$	464,414

⁽¹⁾All mortgage-backed securities and collateralized mortgage obligations were issued by an agency or government sponsored entity of the U.S. Government.

The book values, estimated fair values, and unrecognized gains and losses of investments classified as held-to-maturity are as follows:

						Gross Unrecognized												Allowance
		Amortized																for Credit
(Dollars in thousands)		Cost				Gains				Losses				Fair Value				Losses
As of December 31, 2025
Mortgage-backed securities⁽¹⁾		$	586,001			$	88			$	115,773			$	470,316			$	-
Collateralized mortgage obligations⁽¹⁾			62,476				-				10,234				52,242				-
Municipal securities			70,164				1,011				997				70,178				450
Total held-to-maturity securities		$	718,641			$	1,099			$	127,004			$	592,736			$	450

⁽¹⁾All mortgage-backed securities and collateralized mortgage obligations were issued by an agency or government sponsored entity of the U.S. Government.

																		Allowance
		Amortized				Gross Unrecognized												for Credit
(Dollars in thousands)		Cost				Gains				Losses				Fair Value				Losses
As of December 31, 2024
Mortgage-backed securities⁽¹⁾		$	626,427			$	-			$	143,544			$	482,883			$	-
Collateralized mortgage obligations⁽¹⁾			68,377				-				13,876				54,501				-
Municipal securities			74,639				46				1,116				73,569				450
Total held-to-maturity securities		$	769,443			$	46			$	158,536			$	610,953			$	450

⁽¹⁾All mortgage-backed securities and collateralized mortgage obligations were issued by an agency or government sponsored entity of the U.S. Government.

The allowance for credit losses on held-to-maturity securities is a contra-asset valuation account that is deducted from the amortized cost basis of held-to-maturity securities to present the net amount expected to be collected. Management measures expected credit losses on held-to-maturity securities on a collective basis by major security type with each type sharing similar risk characteristics, and considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts. With regard to residential mortgage-backed securities issued by the U.S. government, or agencies thereof, it is expected that the securities will not be settled at prices less than the amortized cost basis of the securities as such securities are backed by the full faith and credit of and/or guaranteed by the U.S. government. Accordingly, no allowance for credit losses has been recorded for these securities. With regard to securities issued by States and political subdivisions and other held-to-maturity securities, management considers (i) issuer bond ratings, (ii) historical loss rates for given bond ratings, (iii) whether issuers continue to make timely principal and interest payments under the contractual terms of the securities, (iv) internal forecasts and (v) whether or not such securities are guaranteed or pre-refunded by the issuers.

Fair values are based on quoted market prices or dealer quotes. If a quoted market price or dealer quote is not available, fair value is estimated using quoted market prices for similar securities.

The following tables show the gross unrealized losses for available-for-sale securities, for which an allowance for credit losses has not been recorded, that have been in an unrealized loss position for less than 12 months or 12 months or more:

										December 31, 2025
		Less Than 12 Months								12 Months or More								Total
(Dollars in thousands)		Fair Value				Unrealized Losses				Fair Value				Unrealized Losses				Fair Value				Unrealized Losses
Available-for-Sale Securities
U.S. Government-sponsored securities		$	461			$	2			$	676			$	8			$	1,137			$	10
Mortgage-backed securities⁽¹⁾			60,935				244				75,647				17,476				136,582				17,720
Collateralized mortgage obligations⁽¹⁾			13,262				230				5,511				132				18,773				362
Total available-for-sale securities		$	74,658			$	476			$	81,834			$	17,616			$	156,492			$	18,092

⁽¹⁾All mortgage-backed securities and collateralized mortgage obligations were issued by an agency or government sponsored entity of the U.S. Government.

										December 31, 2024
		Less Than 12 Months								12 Months or More								Total
(Dollars in thousands)		Fair Value				Unrealized Losses				Fair Value				Unrealized Losses				Fair Value				Unrealized Losses
Available-for-Sale Securities
U.S. Government-sponsored securities		$	600			$	1			$	888			$	16			$	1,488			$	17
Mortgage-backed securities⁽¹⁾			324,202				5,772				67,319				21,136				391,521				26,908
Commerical mortgage-backed securities⁽¹⁾			1,212				16				-				-				1,212				16
Collateralized mortgage obligations⁽¹⁾			5,043				147				454				9				5,497				156
Other			347				5				-				-				347				5
Total available-for-sale securities		$	331,404			$	5,941			$	68,661			$	21,161			$	400,065			$	27,102

⁽¹⁾All mortgage-backed securities and collateralized mortgage obligations were issued by an agency or government sponsored entity of the U.S. Government.

As of December 31, 2025, the Company held 324 available-for-sale securities of which 14 securities were in an unrealized loss position for less than twelve months and 104 securities were in an unrealized loss position for twelve months or more without an allowance for credit losses. 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 and it is likely that the Company will not be required to sell the securities prior to their anticipated recovery at maturity, it has been determined that there is no expected credit loss on these securities. Management evaluates the available-for-sale securities in an unrealized loss position, relying primarily on industry analyst reports and observations of market conditions and interest rate fluctuations.

The following tables present the activity in the allowance for credit losses for held-to-maturity securities by major type:

		December 31, 2025
(Dollars in thousands)		Municipal securities				Mortgage-backed securities				Collateralized mortgage obligations				Total
Allowance for credit losses - securities
Beginning balance		$	450			$	-			$	-			$	450
Provision for credit losses			-				-				-				-
Ending balance		$	450			$	-			$	-			$	450

		December 31, 2024
(Dollars in thousands)		Municipal securities				Mortgage-backed securities				Collateralized mortgage obligations				Total
Allowance for credit losses - securities
Beginning balance		$	450			$	-			$	-			$	450
Provision for credit losses			-				-				-				-
Ending balance		$	450			$	-			$	-			$	450

The amortized cost and estimated fair values of investment securities at December 31, 2025 by contractual final maturity are shown in the following table:

		Available-for-Sale								Held-to-Maturity
(Dollars in thousands)		Amortized Cost				Fair Value				Amortized Cost				Fair Value
Securities maturing in:
One year or less		$	5,670			$	5,672			$	1,918			$	1,911
After one year through five years			25,577				25,733				18,411				18,389
After five years through ten years			24,394				25,778				18,653				17,843
After ten years			899,562				893,971				679,659				554,593
Total		$	955,203			$	951,154			$	718,641			$	592,736

Maturities are based on the final contractual payment dates, and do not reflect the impact of contractual monthly principal payments, prepayments or early redemptions that may occur. Expected maturities of mortgage-backed and CMO securities may differ from contractual maturities because borrowers have the right to call or prepay obligations with or without call or prepayment penalties.

The Company monitors the credit quality of those held-to-maturity securities not issued by the U.S. government or one of its agencies or government sponsored entities, through the use of credit ratings. Credit ratings are reviewed and updated quarterly. Nonrated municipal investments consist primarily of bonds issued by political subdivisions such as housing authorities and reclamation districts. Nonrated municipal investments are monitored through financial covenants and review of repayment history. As of December 31, 2025, there were no past due principal or interest payments associated with held-to-maturity municipal securities. There were no holdings of securities of any one issuer, other than the U.S. Government and its agencies, in an amount greater than 10% of shareholders’ equity.

The following tables summarize the amortized cost of held-to-maturity municipal securities by credit rating as of the dates indicated:

		Held-to-Maturity
		Amortized Cost
(Dollars in thousands)		AAA/AA/A				BBB/BB/B				Not Rated				Total
December 31, 2025

Municipal securities		$	18,562			$	935			$	50,667			$	70,164
Total		$	18,562			$	935			$	50,667			$	70,164

		Held-to-Maturity
		Amortized Cost
(Dollars in thousands)		AAA/AA/A				BBB/BB/B				Not Rated				Total
December 31, 2024

Municipal securities		$	19,022			$	403			$	55,214			$	74,639
Total		$	19,022			$	403			$	55,214			$	74,639

During 2025, the Company sold securities with a book value of $24.8 million for a net gain of $44,287. Included in the sales were $3.2 million of securities that were in the held-to-maturity portfolio and were sold for a loss of $145,367 for the year ended December 31, 2025. All held-to-maturity securities sold were mortgage-backed securities with a remaining book value of less than 15% of the original principal balance at the time of purchase and, as allowed under ASC 320-10-25-14, the sales were considered maturities for purposes of security classification.

Proceeds from sales and calls of investment securities were as follows:

		For the Year Ended December 31,
(Dollars in thousands)		2025				2024				2023
Gross proceeds		$	25,797			$	70,721			$	39,901
Gross gains			189				839				-
Gross losses			145				96				8,199

Pledged Securities

As of December 31, 2025, investment securities carried at $673.8 million were pledged to secure public deposits, Federal Home Loan Bank (“FHLB”) borrowings, and other government agency deposits as required by law. This amount was $712.5 million at December 31, 2024.