nrim-20240930

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

☑ Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended September 30, 2024

☐ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from_____to____

Commission File Number 000-33501

NORTHRIM BANCORP, INC.

(Exact name of registrant as specified in its charter)


Alaska						92-0175752
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

3111 C Street

Anchorage, Alaska 99503

(Address of principal executive offices) (Zip Code)

(907) 562-0062

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act: None


TITLE OF EACH CLASS	TRADING SYMBOL	NAME OF EXCHANGE

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

ý Yes ¨ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

ý Yes ¨ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

Large Accelerated Filer ¨ Accelerated Filer ý Non-accelerated Filer ¨

Smaller Reporting Company ☐ Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

☐ Yes ý No

The number of shares of the issuer’s Common Stock, par value $1 per share, outstanding at October 30, 2024 was 5,501,943.


TABLE OF CONTENTS

Part I	FINANCIAL INFORMATION
Item 1.	Financial Statements (unaudited)
	Consolidated Balance Sheets	3
	Consolidated Statements of Income	4
	Consolidated Statements of Comprehensive Income	5
	Consolidated Statements of Changes in Shareholders' Equity	6
	Consolidated Statements of Cash Flows	8
	Notes to the Consolidated Financial Statements	10
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	40
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	58
Item 4.	Controls and Procedures	58

Part II	OTHER INFORMATION
Item 1.	Legal Proceedings	59
Item 1A.	Risk Factors	59
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	59


Item 5.	Other Information	60
Item 6.	Exhibits	60
SIGNATURES		61

PART I. FINANCIAL INFORMATION

These consolidated financial statements should be read in conjunction with the consolidated financial statements, accompanying notes and other relevant information included in Northrim BanCorp, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2023.

ITEM 1. FINANCIAL STATEMENTS

CONSOLIDATED FINANCIAL STATEMENTS

NORTHRIM BANCORP, INC.

Consolidated Balance Sheets

(Unaudited)


	September 30, 2024	December 31, 2023
(In Thousands, Except Share Data)
ASSETS
Cash and due from banks	$42,805	$27,457
Interest bearing deposits in other banks	60,071	91,073
Investment securities available for sale, at fair value	545,210	637,936
Marketable equity securities	12,957	13,153
Investment securities held to maturity, at amortized cost	36,750	36,750
Investment in Federal Home Loan Bank stock	4,318	2,980

Loans held for sale	97,937	31,974
Loans	2,007,565	1,789,497
Allowance for credit losses, loans	(19,528)	(17,270)
Net loans	1,988,037	1,772,227
Purchased receivables, net	23,564	36,842
Mortgage servicing rights, at fair value	21,570	19,564

Premises and equipment, net	39,625	40,693
Operating lease right-of-use assets	7,616	9,092
Goodwill	15,017	15,017
Other intangible assets, net	950	950
Other assets	66,965	71,789
Total assets	$2,963,392	$2,807,497
LIABILITIES
Deposits:
Demand	$763,595	$749,683
Interest-bearing demand	979,238	927,291
Savings	245,043	255,338
Money market	201,821	221,492
Certificates of deposit less than $250,000	219,838	189,106
Certificates of deposit $250,000 and greater	216,032	142,145
Total deposits	2,625,567	2,485,055

Borrowings	13,354	13,675
Junior subordinated debentures	10,310	10,310
Operating lease liabilities	7,635	9,092
Other liabilities	46,476	54,647
Total liabilities	2,703,342	2,572,779
SHAREHOLDERS' EQUITY
Preferred stock, $1 par value, 2,500,000 shares authorized, none issued or outstanding	—	—
Common stock, $1 par value, 10,000,000 shares authorized, 5,501,943 and 5,513,459 issued and outstanding at September 30, 2024 and December 31, 2023, respectively	5,502	5,513
Additional paid-in capital	9,460	9,605
Retained earnings	251,842	236,037
Accumulated other comprehensive loss, net of tax	(6,754)	(16,437)
Total shareholders' equity	260,050	234,718
Total liabilities and shareholders' equity	$2,963,392	$2,807,497

See notes to consolidated financial statements

NORTHRIM BANCORP, INC.

Consolidated Statements of Income

(Unaudited)


	Three Months Ended		Nine Months Ended
	September 30,		September 30,
(In Thousands, Except Per Share Data)	2024	2023	2024	2023
Interest and Dividend Income
Interest and fees on loans and loans held for sale	$34,863	$29,097	$97,680	$79,104
Interest on investment securities available for sale	3,408	4,012	10,682	11,942
Dividends on marketable equity securities	209	199	679	542
Interest on investment securities held to maturity	467	473	1,419	1,420
Dividends on Federal Home Loan Bank stock	80	43	214	114
Interest on deposits in other banks	389	584	1,459	2,901
Total Interest and Dividend Income	39,416	34,408	112,133	96,023
Interest Expense
Interest expense on deposits	10,123	7,138	28,779	17,835

Interest expense on borrowings	357	825	729	1,381
Interest expense on junior subordinated debentures	94	95	283	283
Total Interest Expense	10,574	8,058	29,791	19,499
Net Interest Income	28,842	26,350	82,342	76,524
Provision for credit losses	2,063	1,190	2,092	2,957
Net Interest Income After Provision for Credit Losses	26,779	25,160	80,250	73,567
Other Operating Income
Mortgage banking income	7,047	4,405	16,962	10,326
Bankcard fees	1,196	1,022	3,218	2,916
Purchased receivable income	1,033	1,180	3,620	3,175
Service charges on deposit accounts	605	550	1,726	1,512
Unrealized gain (loss) on marketable equity securities	576	12	830	(445)



Other income	1,130	833	2,652	2,406
Total Other Operating Income	11,587	8,002	29,008	19,890
Other Operating Expense
Salaries and other personnel expense	17,549	15,657	49,593	46,324
Data processing expense	2,618	2,589	7,878	7,321
Occupancy expense	1,911	1,857	5,716	5,611
Professional and outside services	903	803	2,384	2,326
Marketing expense	860	499	2,063	1,996
Insurance expense	596	640	2,067	1,844
OREO expense, net rental income and gains on sale	2	(784)	(387)	(766)
Intangible asset amortization expense	—	4	—	11



Other operating expense	2,289	1,631	6,246	5,521
Total Other Operating Expense	26,728	22,896	75,560	70,188
Income Before Provision for Income Taxes	11,638	10,266	33,698	23,269
Provision for income taxes	2,813	1,892	7,654	4,488


Net Income	$8,825	$8,374	$26,044	$18,781
Earnings Per Share, Basic	$1.60	$1.50	$4.73	$3.34
Earnings Per Share, Diluted	$1.57	$1.48	$4.67	$3.30
Weighted Average Common Shares Outstanding, Basic	5,501,943	5,569,238	5,500,703	5,630,948
Weighted Average Common Shares Outstanding, Diluted	5,583,055	5,624,906	5,574,135	5,688,687

See notes to consolidated financial statements

NORTHRIM BANCORP, INC.

Consolidated Statements of Comprehensive Income

(Unaudited)

2010


	Three Months Ended September 30,		Nine Months Ended September 30,
(In Thousands)	2024	2023	2024	2023
Net income	$8,825	$8,374	$26,044	$18,781
Other comprehensive income (loss), net of tax:
Securities available for sale:
Unrealized holding gains arising during the period	$10,591	$1,320	$13,689	$5,025



Derivatives and hedging activities:
Unrealized holding gains (losses) arising during the period	(488)	639	(160)	621
Income tax expense related to unrealized (gains) losses	(2,872)	(557)	(3,847)	(1,606)
Other comprehensive income, net of tax	7,231	1,402	9,682	4,040
Comprehensive income	$16,056	$9,776	$35,726	$22,821

See notes to consolidated financial statements

NORTHRIM BANCORP, INC.

Consolidated Statements of Changes in Shareholders’ Equity

(Unaudited)


	Common Stock		Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Income (Loss), net of Tax	Total
	Number of Shares	Par Value
(In Thousands)
Balance as of January 1, 2023	5,701	$5,701	$17,784	$224,225	($29,081)	$218,629
Cash dividend on common stock ($0.60 per share)	—	—	—	(3,444)	—	(3,444)
Stock-based compensation expense	—	—	140	—	—	140

Repurchase of common stock	(28)	(28)	(1,299)	—	—	(1,327)
Other comprehensive gain, net of tax	—	—	—	—	5,597	5,597


Net income	—	—	—	4,830	—	4,830
Balance as of March 31, 2023	5,673	$5,673	$16,625	$225,611	($23,484)	$224,425
Cash dividend on common stock ($0.60 per share)	—	—	—	(3,432)	—	(3,432)
Stock-based compensation expense	—	—	225	—	—	225

Repurchase of common stock	(62)	(62)	(2,439)	—	—	(2,501)
Other comprehensive loss, net of tax	—	—	—	—	(2,958)	(2,958)
Net income	—	—	—	5,577	—	5,577
Balance as of June 30, 2023	5,611	$5,611	$14,411	$227,756	($26,442)	$221,336
Cash dividend on common stock ($0.60 per share)	—	—	—	(3,384)	—	(3,384)
Stock-based compensation expense	—	—	254	—	—	254
Exercise of stock options and vesting of restricted stock units, net	—	—	(12)	—	—	(12)
Repurchase of common stock	(63)	(63)	(2,648)	—	—	(2,711)
Other comprehensive gain, net of tax	—	—	—	—	1,402	1,402
Net income	—	—	—	8,374	—	8,374
Balance as of September 30, 2023	5,548	$5,548	$12,005	$232,746	($25,040)	$225,259
Cash dividend on common stock ($0.60 per share)	—	—	—	(3,322)	—	(3,322)
Stock-based compensation expense	—	—	318	—	—	318
Exercise of stock options and vesting of restricted stock units, net	21	21	(269)	—	—	(248)
Repurchase of common stock	(56)	(56)	(2,449)	—	—	(2,505)
Other comprehensive gain, net of tax	—	—	—	—	8,603	8,603
Net income	—	—	—	6,613	—	6,613
Balance as of December 31, 2023	5,513	$5,513	$9,605	$236,037	($16,437)	$234,718

See notes to consolidated financial statements

NORTHRIM BANCORP, INC.

Consolidated Statements of Changes in Shareholders’ Equity

(Continued)

(Unaudited)


	Common Stock		Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Income (Loss), net of Tax	Total
	Number of Shares	Par Value
(In Thousands)
Balance as of January 1, 2024	5,513	$5,513	$9,605	$236,037	($16,437)	$234,718
Cash dividend on common stock ($0.61 per share)	—	—	—	(3,388)	—	(3,388)
Stock-based compensation expense	—	—	208	—	—	208
Exercise of stock options and vesting of restricted stock units, net	1	1	(27)	—	—	(26)
Repurchase of common stock	(14)	(14)	(774)	—	—	(788)
Other comprehensive gain, net of tax	—	—	—	—	404	404

Net income	—	—	—	8,199	—	8,199
Balance as of March 31, 2024	5,500	$5,500	$9,012	$240,848	($16,033)	$239,327
Cash dividend on common stock ($0.61 per share)	—	—	—	(3,393)	—	(3,393)
Stock-based compensation expense	—	—	219	—	—	219
Exercise of stock options and vesting of restricted stock units, net	2	2	(23)	—	—	(21)

Other comprehensive gain, net of tax	—	—	—	—	2,048	2,048
Net income	—	—	—	9,020	—	9,020
Balance as of June 30, 2024	5,502	$5,502	$9,208	$246,475	($13,985)	$247,200
Cash dividend on common stock ($0.62 per share)	—	—	—	(3,458)	—	(3,458)
Stock-based compensation expense	—	—	265	—	—	265
Exercise of stock options and vesting of restricted stock units, net	—	—	(13)	—	—	(13)

Other comprehensive gain, net of tax	—	—	—	—	7,231	7,231
Net income	—	—	—	8,825	—	8,825
Balance as of September 30, 2024	5,502	$5,502	$9,460	$251,842	($6,754)	$260,050

See notes to consolidated financial statements

NORTHRIM BANCORP, INC.

Consolidated Statements of Cash Flows

(Unaudited)


	Nine Months Ended September 30,
(In Thousands)	2024	2023
Operating Activities:
Net income	$26,044	$18,781
Adjustments to Reconcile Net Income to Net Cash (Used) by Operating Activities:


Depreciation and amortization of premises and equipment	2,712	2,430
Amortization of software	511	865
Intangible asset amortization	—	11
Amortization of investment security premium, net of discount accretion	309	376
Unrealized (gain) loss on marketable equity securities	(830)	445

Stock-based compensation	692	619

Deferred loan fees and amortization, net of costs	190	(324)
Provision for credit losses	2,092	2,957

Additions to home mortgage servicing rights carried at fair value	(3,080)	(2,440)
Change in fair value of home mortgage servicing rights carried at fair value	1,074	1,679
Change in fair value of commercial servicing rights carried at fair value	155	144
Gain on sale of loans	(10,247)	(6,366)
Proceeds from the sale of loans held for sale	390,907	267,165
Origination of loans held for sale	(446,623)	(296,412)
Gain on sale of other real estate owned	(392)	(929)
Impairment on other real estate owned	—	123


Net changes in assets and liabilities:
(Increase) in accrued interest receivable	(951)	(3,265)
Decrease in other assets	—	1,903
(Decrease) increase in other liabilities	(6,808)	1,127
Net Cash (Used) by Operating Activities	(44,245)	(11,111)
Investing Activities:
Investment in securities:
Purchases of investment securities available for sale	(19,517)	(6,000)
Purchases of marketable equity securities	(1,964)	(324)
Purchases of FHLB stock	(24,872)	(5,441)

Proceeds from sales/calls/maturities of securities available for sale	125,625	35,528
Proceeds from calls of marketable equity securities	2,989	—


Proceeds from redemption of FHLB stock	23,534	2,923
Decrease (increase) in purchased receivables, net	13,278	(14,584)
Increase in loans, net	(241,563)	(218,121)
Proceeds from the sale of loans	23,469	—
Proceeds from sale of other real estate owned	392	929


Purchases of software	(419)	(104)

Purchases of premises and equipment	(1,644)	(5,529)
Net Cash (Used) by Investing Activities	(100,692)	(210,723)
Financing Activities:
Increase in deposits	140,512	40,719

(Decrease) increase in borrowings	(321)	49,686
Repurchase of common stock	(788)	(6,539)


Cash dividends paid	(10,120)	(10,154)
Net Cash Provided by Financing Activities	129,283	73,712
Net Change in Cash and Cash Equivalents	(15,654)	(148,122)
Cash and Cash Equivalents at Beginning of Period	118,530	259,350
Cash and Cash Equivalents at End of Period	$102,876	$111,228



Supplemental Information:
Income taxes paid	$3,488	$2,031
Interest paid	$29,286	$18,340
Noncash commitments to invest in Low Income Housing Tax Credit Partnerships	$—	$14,273
Transfer of loans to other real estate owned	$—	$273


Non-cash lease liability arising from obtaining right of use assets	$265	$423
Cash dividends declared but not paid	$119	$106

See notes to consolidated financial statements

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. Basis of Presentation and Significant Accounting Policies

The accompanying unaudited consolidated financial statements and corresponding footnotes have been prepared by Northrim BanCorp, Inc. (the “Company”) in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and with instructions to Form 10-Q under the Securities Exchange Act of 1934, as amended. The year-end Consolidated Balance Sheet data was derived from the Company's audited financial statements. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The Company owns a 100% interest in Residential Mortgage Holding Company, LLC, the parent company of Residential Mortgage, LLC (collectively “RML”) and consolidates their balance sheets and income statement into its financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The Company determined that it operates in two primary operating segments: Community Banking and Home Mortgage Lending. The Company has evaluated subsequent events and transactions for potential recognition or disclosure. Operating results for the interim period ended September 30, 2024 are not necessarily indicative of the results anticipated for the year ending December 31, 2024. These consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.

The Company’s significant accounting policies are discussed in Note 1 to the audited consolidated financial statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2023. There have been no significant changes in our application of these accounting policies in 2024.

Reclassification of Prior Period Presentation

Certain prior year amounts have been reclassified for consistency with the current period presentation. These reclassifications had no effect on the reported results of operations or total shareholders' equity.

Recent Accounting Pronouncements

Accounting pronouncements implemented in 2024

In March 2023, the Financial Accounting Standards Board (“FASB”) issued ASU 2023-02, Investments - Equity Method and Joint Ventures (Topic 323): Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method (“ASU 2023-02”). Under current GAAP, an entity can only elect to apply the proportional amortization method to investments in low income housing tax credit (“LIHTC”) structures. The amendments in ASU 2023-02 allow entities to elect to account for equity investments made primarily for the purpose of receiving income tax credits using the proportional amortization method, regardless of the tax credit program through which the investment earns income tax credits, if certain conditions are met. ASU 2023-02 provides amendments to Accounting Standards Codification (“ASC”) paragraph 323-740-25-1, which sets forth the conditions needed to apply the proportional amortization method. The amendments make certain limited changes to those conditions to clarify their application to a broader group of tax credit investment programs. However, the conditions in substance remain consistent with current GAAP. The amendments in this ASU 2023-02 also eliminate certain LIHTC-specific guidance to align the accounting more closely for LIHTCs with the accounting for other equity investments in tax credit structures and require that the delayed equity contribution guidance in paragraph ASC 323-740-25-3 applies only to tax equity investments accounted for using the proportional amortization method. The Company adopted ASU 2023-02 on January 1, 2024. The adoption of ASU 2023-02 did not have a material impact on the Company's consolidated financial statements.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures (“ASU 2023-07”). Under current GAAP, public entities are required to report a measure of segment profit or loss. The amendments in ASU 2023-07 do not change or remove this requirement, nor does it change how an entity identifies its operating segments. The amendments in ASU 2023-07 improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The Company adopted ASU 2023-07 on January 1, 2024. The adoption of ASU 2023-07 did not have a material impact on the Company's consolidated financial statements.

Accounting pronouncements to be implemented in future periods

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740) - Improvements to Income Tax Disclosures (“ASU 2023-09”). The amendments in ASU 2023-09 improve transparency of income tax disclosures related to rate reconciliation and income taxes paid disclosures by requiring consistent categories and greater disaggregation of information in rate reconciliation, and by requiring disclosure of income taxes paid disaggregated by jurisdiction. The amendments in ASU 2023-09 allow investors to better assess, in their capital allocation decisions, how an entity's worldwide operations and related tax risks and tax planning and operations opportunities affect its income tax rate and prospects for future cash flow. ASU 2023-09 is effective for the Company for fiscal years beginning after December 15, 2024 and may be applied on a prospective or retrospective basis. The Company intends to adopt ASU 2023-09 prospectively and does not believe that the adoption will have a material impact on the Company's consolidated financial statements.

In March 2024, the FASB issued ASU 2024-02, Codification Improvements - Amendments to Remove References to the Concepts Statements ("ASU 2024-02"). ASU 2024-02 contains amendments to the Codification that remove references to various Concepts Statements. In most instances, the references are extraneous and not required to understand or apply the guidance. In other instances, the references were used in prior Concepts Statements to provide guidance in certain topical areas. FASB Concepts Statement are nonauthoritative. Removing all references to Concepts Statements in the guidance is intended to simplify the Codification and draw a distinction between authoritative and nonauthoritative literature. ASU 2024-02 is effective for the Company for fiscal years beginning after December 15, 2024 and may be applied on a prospective or retrospective basis. The Company intends to adopt ASU 2024-02 prospectively and does not believe that the adoption will have a material impact on the Company's consolidated financial statements.

2. Investment Securities

Marketable Equity Securities

The Company held marketable equity securities with fair values of $13.0 million and $13.2 million at September 30, 2024 and December 31, 2023, respectively. The gross realized and unrealized gains (losses) recognized on marketable equity securities in other operating income in the Company's Consolidated Statements of Income were as follows:


	Three Months Ended September 30,		Nine Months Ended September 30,
(In Thousands)	2024	2023	2024	2023
Unrealized gain (loss) on marketable equity securities	$576	$12	$830	($445)

Total	$576	$12	$830	($445)

Debt securities

Debt securities have been classified in the financial statements as available for sale or held to maturity. The following table summarizes the amortized cost, estimated fair value, and the Allowance for Credit Losses (“ACL”) of debt securities and the corresponding amounts of gross unrealized gains and losses of available-for-sale securities recognized in accumulated other comprehensive income (loss) and gross unrecognized gains and losses of held to maturity securities at the periods indicated:


(In Thousands)	Amortized Cost	Gross Unrealized Gains	Gross Unrealized Losses	Allowance for Credit Losses	Fair Value
September 30, 2024
Securities available for sale
U.S. Treasury and government sponsored entities	$500,436	$1,094	($11,607)	$—	$489,923


Corporate bonds	9,011	20	(229)	—	8,802
Collateralized loan obligations	46,405	87	(7)	—	46,485
Total securities available for sale	$555,852	$1,201	($11,843)	$—	$545,210


(In Thousands)	Amortized Cost	Gross Unrealized Gains	Gross Unrealized Losses	Fair Value
September 30, 2024
Securities held to maturity
Corporate bonds	$36,750	$—	($2,135)	$34,615
Allowance for credit losses	—	—	—	—
Total securities held to maturity, net of ACL	$36,750	$—	($2,135)	$34,615


(In Thousands)	Amortized Cost	Gross Unrealized Gains	Gross Unrealized Losses	Allowance for Credit Losses	Fair Value
December 31, 2023
Securities available for sale
U.S. Treasury and government sponsored entities	$587,639	$451	($23,965)	$—	$564,125
Municipal securities	820	—	(4)	—	816

Corporate bonds	14,014	28	(418)	—	13,624
Collateralized loan obligations	59,795	12	(436)	—	59,371
Total securities available for sale	$662,268	$491	($24,823)	$—	$637,936


(In Thousands)	Amortized Cost	Gross Unrealized Gains	Gross Unrealized Losses	Fair Value
December 31, 2023
Securities held to maturity
Corporate bonds	$36,750	$—	($3,337)	$33,413
Allowance for credit losses	—	—	—	—
Total securities held to maturity, net of ACL	$36,750	$—	($3,337)	$33,413

Gross unrealized losses on available for sale securities and the fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at September 30, 2024 and December 31, 2023 were as follows:


	Less Than 12 Months		More Than 12 Months		Total
(In Thousands)	Fair Value	Unrealized Losses	Fair Value	Unrealized Losses	Fair Value	Unrealized Losses
September 30, 2024
Securities available for sale
U.S. Treasury and government sponsored entities	$9,991	($9)	$434,211	($11,598)	$444,202	($11,607)
Corporate bonds	—	—	4,783	(229)	4,783	(229)
Collateralized loan obligations	—	—	4,988	(7)	4,988	(7)



Total	$9,991	($9)	$443,982	($11,834)	$453,973	($11,843)




December 31, 2023:
Securities available for sale
U.S. Treasury and government sponsored entities	$9,997	($3)	$528,574	($23,962)	$538,571	($23,965)
Corporate bonds	—	—	6,599	(418)	6,599	(418)
Collateralized loan obligations	3,909	(91)	43,149	(345)	47,058	(436)
Municipal securities	—	—	816	(4)	816	(4)

Total	$13,906	($94)	$579,138	($24,729)	$593,044	($24,823)

Management evaluates available for sale debt securities in unrealized loss positions to determine whether the impairment is due to credit-related factors or noncredit-related factors. Consideration is given to the extent to which the fair value is less than cost, the financial condition and near-term prospects of the issuer, and the intent and ability of the Company to retain its investment in the security for a period of time sufficient to allow for any anticipated recovery in fair value.

At September 30, 2024, the Company had 50 available for sale securities in an unrealized loss position without an ACL. At September 30, 2024, the Company had five held to maturity securities in an unrealized loss position without an ACL. Management does not have the intent to sell any of these securities and believes that it is more likely than not that the Company will not have to sell any such securities before a recovery of cost. The fair value is expected to recover as the securities approach their maturity date or repricing date or if market yields for such investments decline. Accordingly, as of September 30, 2024, management believes that the unrealized losses detailed in the previous table are due to noncredit-related factors, primarily changes in interest rates, and therefore no losses have been recognized in the Company's Consolidated Statements of Income.

At September 30, 2024 and December 31, 2023, carrying amounts of $179.2 million and $180.1 million in securities were pledged for deposits and borrowings, respectively.

The amortized cost and estimated fair values of debt securities at September 30, 2024, are distributed by contractual maturity as shown below. Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.


(In Thousands)	Amortized Cost	Fair Value
US Treasury and government sponsored entities
Within 1 year	$176,092	$174,118
1-5 years	324,344	315,805

Total	$500,436	$489,923






Corporate bonds
Within 1 year	$3,999	$4,019
1-5 years	15,012	14,722
5-10 years	26,750	24,676
Total	$45,761	$43,417
Collateralized loan obligations

5-10 years	$27,405	$27,432
Over 10 years	19,000	19,053
Total	$46,405	$46,485

There were no proceeds from sales of investment securities for the three or nine-month periods ending September 30, 2024 and 2023.

A summary of interest income for the three and nine-month periods ending September 30, 2024 and 2023, on available for sale investment securities are as follows:


	Three Months Ended September 30,		Nine Months Ended September 30,
(In Thousands)	2024	2023	2024	2023
US Treasury and government sponsored entities	$2,443	$2,794	$7,511	$8,424

Other	965	1,214	3,168	3,505
Total taxable interest income	$3,408	$4,008	$10,679