BORROWINGS

12 Months Ended

Dec. 31, 2025

Debt Disclosure [Abstract]

BORROWINGS

BORROWINGS

The Bank has executed a blanket pledge and security agreement with the FHLB which requires certain loans and securities be pledged as collateral for any outstanding borrowings under the agreement. The collateral pledged as of December 31, 2025 and 2024 amounted to $1.45 billion and $1.30 billion, respectively. Based on this collateral and the Company’s holdings of FHLB stock, the Company was eligible to borrow an additional $623.4 million as of December 31, 2025.

Upon maturity, the Company renewed a three-month $50.0 million FHLB advance on October 2, 2025. The rate for the borrowing is adjusted daily based on the SOFR rate plus 14.0 basis points. The advance matured on January 2, 2026 and was renewed for an additional three months.

The following presents the Company's maturities of FHLB borrowings (dollars in thousands):

			December 31,
Maturity Date	Rate %		2025		2024
January 1, 2026(1)	3.89	%	$	12,332	$	5,000
January 2, 2026	3.85		50,000		50,000
Total			$	62,332	$	55,000

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(1)The borrowing has a one day, automatic daily renewal maturity date, subject to FHLB discretion not to renew.

To bolster the effectiveness of the SBA’s PPP, the Federal Reserve supplied liquidity to participating financial institutions through term financing collateralized by PPP loans to small businesses. The Paycheck Protection Program Liquidity Facility (PPPLF) extended credit to eligible financial institutions that originated PPP loans, taking the loans as collateral at face value and bearing interest at 35 bps. The terms of the loans are directly tied to the underlying PPP loans, which were originated at 2 or 5 years. For the years ended December 31, 2025 and 2024, the Company had outstanding $0.5 million and $2.0 million, respectively, under the PPPLF program which is included in the FHLB and Federal Reserve borrowings line of the Consolidated Balance Sheets.

The Bank has borrowing capacity associated with two unsecured federal funds lines of credit up to $10.0 million and $19.0 million. As of December 31, 2025 and 2024, there were no amounts outstanding on any of the federal funds lines.

The following presents the Company's subordinated notes included in the Subordinated notes line of the Consolidated Balance Sheets (dollars in thousands):

Issuance Date	Stated Rate	Interest Paid	Maturity	Carrying Value		Initial Debt Issuance Costs		Remaining Net Balance as of December 31, 2025(1)
November 2020	SOFR plus 402 basis points until maturity	Quarterly	12/1/2030	$	10,000	$	162	$	10,000
August 2021	3.25% per annum until 9/1/2026, then SOFR plus 258 basis points until maturity	Semi-annual (Quarterly beginning 09/01/26)	9/1/2031	15,000		242		14,963
December 2022	7.00% per annum until 12/15/2027, then SOFR plus 328 basis points until maturity	Semi-annual (Quarterly beginning 12/15/27)	12/15/2032	20,000		506		19,809

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(1)Remaining net balance includes amortization of debt issuance costs.

In 2025, a subordinated note with a carrying value of $8.0 million became eligible and was redeemed. For the years ended December 31, 2025 and 2024, the Company recorded $2.4 million and $2.7 million, respectively, of interest expense related to the collective subordinated notes. The subordinated notes are included in Tier 2 capital under current regulatory guidelines and interpretations, subject to limitations.

The Company’s borrowing facilities include various financial and other covenants, including, but not limited to, a requirement that the Bank maintains regulatory capital that is deemed "well capitalized" by federal banking agencies. See Note 22 – Regulatory Capital Matters for additional information. As of December 31, 2025 and 2024, the Company was in compliance with the covenant requirements.