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INVESTMENT SECURITIES
 12 Months Ended
Dec. 31, 2023
Investments, Debt and Equity Securities [Abstract]  
INVESTMENT SECURITIES INVESTMENT SECURITIES
The following presents the amortized cost, fair value, and allowance for credit losses of securities held-to-maturity and the corresponding amounts of gross unrecognized gains and losses as of the date noted (dollars in thousands):
December 31, 2023Amortized
Cost		Gross
Unrecognized
Gains		Gross
Unrecognized
Losses		Fair
Value
Allowance for Credit Losses(1)
Investment securities held-to-maturity:
U.S. Treasury debt$253 $— $(11)$242 $— 
Corporate bonds23,687 — (3,020)20,667 (71)
GNMA mortgage-backed securities – residential34,579 — (3,410)31,169 — 
FNMA mortgage-backed securities – residential6,035 — (509)5,526 — 
Government CMO and MBS - commercial5,836 9 (377)5,468 — 
Corporate CMO and MBS(2)
3,783 — (238)3,545 — 
Total securities held-to-maturity$74,173 $9 $(7,565)$66,617 $(71)
(1) Refer to Note 1 – Organization and Summary of Significant Accounting Policies for further information on our credit loss methodology.
(2) Management reviewed the collectability of corporate CMO and MBS securities taking into consideration such factors as the asset quality of the corporate bond issuers and credit support and delinquencies associated with the corporate CMO and MBS.
December 31, 2022Amortized
Cost		Gross
Unrecognized
Gains		Gross
Unrecognized
Losses		Fair
Value
Investment securities held-to-maturity:
U.S. Treasury debt$243 $— $(9)$234 
Corporate bonds23,819 — (2,453)21,366 
GNMA mortgage-backed securities – residential39,426 — (2,800)36,626 
FNMA mortgage-backed securities – residential6,708 — (506)6,202 
Government CMO and MBS - commercial6,786 13 (403)6,396 
Corporate CMO and MBS4,074 — (180)3,894 
Total securities held-to-maturity$81,056 $13 $(6,351)$74,718 
Net amortization of premiums and discounts related to mortgage securities during each of the years ended December 31, 2023 and 2022 totaled an immaterial amount and $0.1 million, respectively, and is included in Net interest income in the Consolidated Statements of Income.
The following presents securities with unrecognized losses aggregated by major security type and length of time in a continuous unrecognized loss position as of the date noted (dollars in thousands, before tax):
Less than 12 Months12 Months or LongerTotal
December 31, 2022Fair
Value		Unrecognized
Losses		Fair
Value		Unrecognized
Losses		Fair
Value		Unrecognized
Losses
Investment securities held-to-maturity:
U.S. Treasury debt$— $— $234 $(9)$234 $(9)
Corporate bonds20,911 (2,436)455 (17)21,366 (2,453)
GNMA mortgage-backed securities – residential22,371 (1,051)14,255 (1,749)36,626 (2,800)
FNMA mortgage-backed securities – residential6,202 (506)— — 6,202 (506)
Government CMO and MBS - commercial5,591 (403)— — 5,591 (403)
Corporate CMO and MBS3,499 (147)395 (33)3,894 (180)
Total$58,574 $(4,543)$15,339 $(1,808)$73,913 $(6,351)
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 other comprehensive income on April 1, 2022 remained in other comprehensive income 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 December 31, 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.
December 31, 2023Amortized
Cost		Fair
Value
Due within one year$253 $242 
Due between one year and five years4,078 3,844 
Due between five years and ten years19,39516,630
Due after ten years214193
Securities (CMO and MBS)50,23345,708
Total$74,173 $66,617 
During year ended December 31, 2022, the Company committed $6.0 million in total to two bank technology funds. During the year ended December 31, 2023, the Company made $0.8 million in contributions to both 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 December 31, 2023, the Company held a balance of $2.0 million which is included in Other assets in the accompanying Consolidated Balance Sheets. The Company may be obligated to invest up to an additional $4.0 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 year ended December 31, 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 December 31, 2023 and 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 Consolidated Balance Sheets. The Company may be obligated to invest up to an additional $0.8 million in future SBIC investments.
As of December 31, 2023, securities with market values totaling $45.1 million were pledged to secure various public deposits and credit facilities of the Company, including $39.3 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 December 31, 2023, there were no holdings of securities of any one issuer in an amount greater than 10% of shareholders’ equity. As of 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 Company did not sell any securities during the years ended December 31, 2023 or 2022.
Allowance for Credit Losses for HTM Securities

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. The Company's non-government backed securities are paying within the agreed upon terms and there are no securities on non-accrual status. Accrued interest receivable on held-to-maturity debt securities totaled $0.4 million at December 31, 2023 and is excluded from the estimate of credit losses. Refer to Note 1 – Organization and Summary of Significant Accounting Policies for additional information on the Company’s methodology on estimating credit losses. The following table presents the activity in the allowance for credit losses for debt securities held-to-maturity by major security type for the year ended December 31, 2023:
December 31, 2023Corporate Bonds
Corporate CMO(1)
Allowance for credit losses:
Beginning balance$— $— 
Impact of ASU 2016-13 adoption(2)
71 — 
Provision for credit losses— — 
Securities charged-off (recoveries)— — 
Total ending allowance balance$71 $— 
(1) Management reviewed the collectability of corporate CMO and MBS securities taking into consideration such factors as the asset quality of the corporate bond issuers and credit support and delinquencies associated with the corporate CMO and MBS.
(2) Refer to Note 1 – Organization and Summary of Significant Accounting Policies for further information on our credit loss methodology
The Company monitors the credit quality of held-to-maturity securities on a quarterly basis. As of December 31, 2023, there were no held-to-maturity securities past due or on non-accrual