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Fair Value of Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2025

Fair Value, Assets Measured on Recurring Basis

The following tables present the fair value measurements of assets and liabilities recognized in the accompanying condensed consolidated balance sheets measured at fair value on a recurring basis and the level within the fair value hierarchy in which the fair value measurements fall at September 30, 2025 and December 31, 2024.


			September 30, 2025 Fair Value Measurements Using
(amounts in thousands)	Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
U.S. Government-sponsored agencies	$	67,536	$	—	$	67,536	$	—
Municipal securities	62,552		—		62,552		—
Agency mortgage-backed securities - residential	355,485		—		355,485		—
Agency mortgage-backed securities - commercial	60,509		—		60,509		—
Private label mortgage-backed securities - residential	36,900		—		36,900		—
Asset-backed securities	17,535		—		17,535		—
Corporate securities	25,389		—		25,389		—

Total available-for-sale securities	$	625,906	$	—	$	625,906	$	—

Servicing asset	22,107		—		—		22,107


Interest rate swap agreements - assets (back-to-back)	253		—		253		—
Interest rate swap agreements - liabilities (back-to-back)	(253)		—		(253)		—


			December 31, 2024 Fair Value Measurements Using
(amounts in thousands)	Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
U.S. Government-sponsored agencies	$	82,816	$	—	$	82,816	$	—
Municipal securities	63,654		—		63,654		—
Agency mortgage-backed securities - residential	269,641		—		269,641		—
Agency mortgage-backed securities - commercial	63,331		—		63,331		—
Private label mortgage-backed securities - residential	45,821		—		45,821		—
Asset-backed securities	23,821		—		23,821		—
Corporate securities	38,271		—		38,271		—

Total available-for-sale securities	$	587,355	$	—	$	587,355	$	—

Servicing asset	16,389		—		—		16,389


Interest rate swap agreements - assets (back-to-back)	200		—		200		—
Interest rate swap agreements - liabilities (back-to-back)	(200)		—		(200)		—

Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation

The following tables reconcile the beginning and ending balances of recurring fair value measurements recognized in the accompanying condensed consolidated balance sheets using significant unobservable (Level 3) inputs for the three and nine months ended September 30, 2025 and 2024.


	Three Months Ended
(amounts in thousands)	September 30, 2025		September 30, 2024
Balance, beginning of period	$	16,736	$	13,009
Total realized gains
Additions:
Originated1	6,703		2,499
Subtractions:
Paydowns	(903)		(689)
Change in fair value	(429)		(157)

Balance, end of period	$	22,107	$	14,662

1 Balance includes $3.8 million of originated servicing asset related to the sale of single tenant lease financing loans that was completed during the three months ended September 30, 2025.



	Nine Months Ended
(amounts in thousands)	September 30, 2025		September 30, 2024
Balance, beginning of period	$	16,389	$	10,567
Total realized gains
Additions:
Originated1	9,384		6,204
Subtractions:
Paydowns	(2,714)		(2,097)
Change in fair value	(952)		(12)

Balance, end of period	$	22,107	$	14,662

1 Balance includes $3.8 million of originated servicing asset related to the sale of single tenant lease financing loans that was completed during the nine months ended September 30, 2025.

Schedule Of Impaired Loans, Including Valuation Allowance, Fair Value, Unobservable Inputs Reconciliation

The following table presents the fair value measurements of assets and liabilities recognized in the accompanying condensed consolidated balance sheets measured at fair value on a nonrecurring basis and the level within the fair value hierarchy in which the fair value measurement falls at September 30, 2025 and December 31, 2024.


			September 30, 2025
(amounts in thousands)			Fair Value Measurements Using
	Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Collateral dependent loans	$	337	$	—	$	—	$	337
Other real estate owned	1,801		—		—		1,801


			December 31, 2024
(amounts in thousands)			Fair Value Measurements Using
	Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Collateral dependent loans	$	4,296	$	—	$	—	$	4,296

Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques

The following tables present quantitative information about unobservable inputs used in recurring and nonrecurring Level 3 fair value measurements.


(dollars in thousands)	Fair Value at September 30, 2025		Valuation Technique	Significant Unobservable Inputs	Range	Weighted-Average Range

Collateral dependent loans	$	337	Fair value of collateral	Discount for type of property and current market conditions	30% - 40%	31.5%

Servicing asset	22,107		Discounted cash flow	Prepayment speeds Discount rate	0% - 25% 13%	12.1% 13.3%
Other real estate owned	1,801		Fair value of collateral	Discount to reflect current market conditions	30%	30.0%

(dollars in thousands)

Fair Value at
December 31, 2024

Valuation
Technique

Significant Unobservable
Inputs

Range

Weighted-Average Range

Collateral dependent loans

4,296

Fair value of collateral

Discount for type of property and current market conditions

0% - 75%

24.2%

Servicing asset

16,389

Discounted cash flow

Prepayment speeds

Discount rate

0% - 25%

14%

11.7%

14%

Fair Value, by Balance Sheet Grouping

The following tables present the carrying value and estimated fair value of all financial assets and liabilities that are not measured at fair value on a recurring basis at September 30, 2025 and December 31, 2024.


	September 30, 2025 Fair Value Measurements Using
(amounts in thousands)	Carrying Amount		Fair Value		Quoted Prices In Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Cash and cash equivalents	$	787,661	$	787,661	$	787,661	$	—	$	—

Securities held-to-maturity, net	261,725		248,447		—		248,447		—
Loans held-for-sale	141,580		151,370		—		151,370		—
Net loans	3,543,583		3,482,547		—		—		3,482,547
Accrued interest receivable	26,674		26,674		26,674		—		—
Federal Home Loan Bank of Indianapolis stock	28,350		28,350		—		28,350		—
Deposits	4,915,434		4,932,641		2,516,385		—		2,416,256
Advances from Federal Home Loan Bank	249,500		251,975		—		251,975		—
Subordinated debt	105,386		104,862		37,059		67,803		—
Accrued interest payable	1,236		1,236		1,236		—		—


	December 31, 2024 Fair Value Measurements Using
(amounts in thousands)	Carrying Amount		Fair Value		Quoted Prices In Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Cash and cash equivalents	$	466,410	$	466,410	$	466,410	$	—	$	—

Securities held-to-maturity, net	249,796		228,851		—		228,851		—
Loans held-for-sale	54,695		58,510		—		58,510		—
Net loans	4,125,877		3,935,009		—		—		3,935,009
Accrued interest receivable	28,180		28,180		28,180		—		—
Federal Home Loan Bank of Indianapolis stock	28,350		28,350		—		28,350		—
Deposits	4,933,206		4,943,961		2,236,724		—		2,707,237
Advances from Federal Home Loan Bank	295,000		291,208		—		291,208		—
Subordinated debt	105,150		103,062		37,059		66,003		—
Accrued interest payable	2,495		2,495		2,495		—		—

- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

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