The following presents the amortized cost and fair value of securities held-to-maturity and the corresponding amounts of gross unrecognized gains and losses as of the date noted (dollars in thousands):


September 30, 2023	Amortized Cost		Gross Unrecognized Gains		Gross Unrecognized Losses		Fair Value		Allowance for Credit Losses(1)
Investment securities held-to-maturity:
U.S. Treasury debt	$	250	$	—	$	(11)	$	239	$	—

Corporate bonds	23,729		—		(3,334)		20,395		(71)
GNMA mortgage-backed securities – residential	35,503		—		(4,152)		31,351		—
FNMA mortgage-backed securities – residential	6,178		—		(730)		5,448		—
Government CMO and MBS - commercial	6,033		10		(558)		5,485		—
Corporate CMO and MBS	3,917		—		(348)		3,569		—
Total securities held-to-maturity	$	75,610	$	10	$	(9,133)	$	66,487	$	(71)


December 31, 2022	Amortized Cost		Gross Unrecognized Gains		Gross Unrecognized Losses		Fair Value
Investment securities held-to-maturity:
U.S. Treasury debt	$	243	$	—	$	(9)	$	234

Corporate bonds	23,819		—		(2,453)		21,366
GNMA mortgage-backed securities – residential	39,426		—		(2,800)		36,626
FNMA mortgage-backed securities – residential	6,708		—		(506)		6,202
Government CMO and MBS - commercial	6,786		13		(403)		6,396
Corporate CMO and MBS	4,074		—		(180)		3,894
Total securities held-to-maturity	$	81,056	$	13	$	(6,351)	$	74,718

The Company reassessed classification of investment securities and, effective April 1, 2022, elected to transfer all securities, fair valued at $58.7 million, from available-for-sale to held-to-maturity. The related unrealized loss of $2.3 million included in accumulated other comprehensive loss on April 1, 2022 remained in accumulated other comprehensive loss and is being amortized out with an offsetting entry to interest income as a yield adjustment through earnings over the remaining term of the securities. No gain or loss was recorded at the time of transfer.

As of September 30, 2023, the amortized cost and estimated fair value of held-to-maturity securities have contractual maturity dates shown in the table below (dollars in thousands). Expected maturities will differ from contractual maturities because borrowers may 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.


September 30, 2023	Amortized Cost		Fair Value
Due within one year	$	250	$	239
Due between one year and five years	1,993		1,874
Due between five years and ten years	21,495		18,303
Due after ten years	241		218
Securities (CMO and MBS)	51,631		45,853
Total	$	75,610	$	66,487

During the year ended December 31, 2022, the Company committed $6.0 million in total to two bank technology funds. During the nine months ended September 30, 2023, the Company made a total of $0.6 million in contributions to the partnerships, and received a $0.1 million return on investment. During the year ended December 31, 2022, the Company made $1.3 million in contributions to both partnerships and received a $0.1 million return on investment. As of September 30, 2023, the Company held a balance of $1.9 million, which is included in Other assets in the accompanying Condensed Consolidated Balance Sheets. The Company may be obligated to invest up to an additional $4.1 million in future contributions.

In 2014, the Company began investing in a small business investment company ("SBIC") fund administered by the Small Business Administration. The Company made $0.2 million in contributions to the SBIC fund during the nine months ended September 30, 2023. During the year ended December 31, 2022, the Company did not make any contributions to the SBIC fund and received a $0.1 million return of capital. As of September 30, 2023 and December 31, 2022, the Company held a balance of $2.2 million and $2.0 million, respectively, in the SBIC fund, which is included in Other assets in the accompanying Condensed Consolidated Balance Sheets. The Company may be obligated to invest up to an additional $0.8 million in future SBIC investments.

As of September 30, 2023, securities with market values totaling $45.2 million were pledged to secure various public deposits and credit facilities of the Company, including $39.5 million pledged under the BTFP program (refer to Note 1 - Organization and Summary of Significant Accounting Policies for more information on the BTFP program). As of December 31, 2022, securities with carrying values of $22.6 million were pledged to secure various public deposits and credit facilities of the Company.

As of September 30, 2023 and December 31, 2022, there were no holdings of securities of any one issuer, other than the U.S. Government sponsored entities and agencies, in an amount greater than 10% of shareholders’ equity.

The following presents securities with unrecognized losses aggregated by major security type and length of time in a continuous unrecognized loss position as of the date noted (dollars in thousands, before tax):


	Less than 12 Months				12 Months or Longer				Total
September 30, 2023	Fair Value		Unrecognized Losses		Fair Value		Unrecognized Losses		Fair Value		Unrecognized Losses
Investment securities held-to-maturity:
U.S. Treasury debt	$	—	$	—	$	239	$	(11)	$	239	$	(11)

Corporate bonds	—		—		20,395		(3,334)		20,395		(3,334)
GNMA mortgage-backed securities – residential	—		—		31,351		(4,152)		31,351		(4,152)
FNMA mortgage-backed securities – residential	—		—		5,449		(730)		5,449		(730)
Government CMO and MBS - commercial	48		*		4,884		(558)		4,932		(558)
Corporate CMO and MBS	—		—		3,547		(348)		3,547		(348)
Total	$	48	*		$	65,865	$	(9,133)	$	65,913	$	(9,133)


	Less than 12 Months				12 Months or Longer				Total
December 31, 2022	Fair Value		Unrecognized Losses		Fair Value		Unrecognized Losses		Fair Value		Unrecognized Losses
Investment securities held-to-maturity:
U.S. Treasury debt	$	—	$	—	$	234	$	(9)	$	234	$	(9)
Corporate bonds	20,911		(2,436)		455		(17)		21,366		(2,453)
GNMA mortgage-backed securities – residential	22,371		(1,051)		14,255		(1,749)		36,626		(2,800)
FNMA mortgage-backed securities - residential	6,202		(506)		—		—		6,202		(506)
Government CMO and MBS - commercial	5,591		(403)		—		—		5,591		(403)
Corporate CMO and MBS	3,499		(147)		395		(33)		3,894		(180)
Total	$	58,574	$	(4,543)	$	15,339	$	(1,808)	$	73,913	$	(6,351)

Management measures expected credit losses on held-to-maturity debt securities on a collective basis by major security type. The majority of our held-to-maturity investment portfolio consists of securities issues by U.S. government entities and agencies and we consider the risk of credit loss to be zero and, therefore, we do not record an ACL. The Company's non-government backed securities include private label CMO and MBS and bank subordinated debt. Accrued interest receivable on held-to-maturity debt securities totaled $0.5 million at September 30, 2023 and is excluded from the estimate of credit losses. Refer to Note 1 - Organization and Summary of Significant Accounting Policies for additional information on the Company’s methodology on estimating credit losses. The following table presents the activity in the allowance for credit losses for debt securities held-to-maturity by major security type for the three and nine months ended September 30, 2023:


Three Months Ended September 30, 2023	Corporate Bonds		Corporate CMO
Allowance for credit losses:
Beginning balance	$	71	$	—

Provision for credit losses	—		—
Securities charged-off (recoveries)	—		—
Total ending allowance balance	$	71	$	—


Nine Months Ended September 30, 2023	Corporate Bonds		Corporate CMO
Allowance for credit losses:
Beginning balance	$	—	$	—
Impact of ASU 2016-13 adoption(1)	71		—
Provision for credit losses	—		—
Securities charged-off (recoveries)	—		—
Total ending allowance balance	$	71	$	—