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Fair Value of Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2023

Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis

Assets and liabilities measured at fair value on a recurring basis as of June 30, 2023 and December 31, 2022 are summarized below:



	Fair Value Measure on a Recurring Basis
($ in thousands)	Total Fair Value		Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
June 30, 2023
U.S. Government agencies or sponsored agency securities:
Residential mortgage-backed securities	$	46,332	$	—	$	46,332	$	—
Residential collateralized mortgage obligations	150,131		—		150,131		—
Municipal securities-tax exempt	5,787		—		5,787		—
Other investments:
Mutual fund - CRA qualified	3,370		3,370		—		—
December 31, 2022
U.S. Government agencies or sponsored agency securities:
Residential mortgage-backed securities	$	49,764	$	—	$	49,764	$	—
Residential collateralized mortgage obligations	160,045		—		160,045		—
Other investments:
Mutual fund - CRA qualified	3,330		3,330		—		—

Schedule of Fair Value Hierarchy and Fair Value of Assets that Were Still Held and Had Fair Value Adjustments Measured On a Nonrecurring Basis

The following table presents the fair value hierarchy and fair value of assets that were still held and had fair value adjustments measured on a nonrecurring basis as of June 30, 2023 and December 31, 2022:



	Fair Value Measure on a Nonrecurring Basis
($ in thousands)	Total Fair Value		Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
June 30, 2023
Collateral-dependent loans:
SBA—real estate	$	768	$	—	$	—	$	768

Home mortgage	2,305		—		—		2,305
Total	$	3,073	$	—	$	—	$	3,073
December 31, 2022
Impaired loans:
SBA—real estate	$	423	$	—	$	—	$	423
Total	$	423	$	—	$	—	$	423
Total

Schedule of Increase (Decrease) In Value of Certain Assets Held at End of Respective Reporting Periods Presented for Which a Nonrecurring Fair Value Adjustment

The following table presents the increase (decrease) in value of certain assets held at the end of the respective reporting periods presented for which a nonrecurring fair value adjustment was recognized during the period presented:



	Three Months Ended June 30,				Six Months Ended June 30,
($ in thousands)	2023		2022		2023		2022
Collateral-dependent loans:
SBA—real estate	$	(1)	$	8	$	1	$	15

Total	$	(1)	$	8	$	1	$	15

Schedule of Information about Significant Unobservable Inputs Utilized in Company's Nonrecurring Level 3 Fair Value Measurements

The following table presents information about significant unobservable inputs utilized in the Company’s nonrecurring Level 3 fair value measurements as of June 30, 2023 and December 31, 2022:

($ in thousands)

Fair Value
Measurements
(Level 3)

Valuation
Techniques

Unobservable
Inputs

Range of
Inputs

Weighted-

Average of

Inputs(1)

June 30, 2023

Collateral-dependent loans:

SBA—real estate

768

Income approach - income capitalization

Capitalization rate

8.0% to 11.5%

9.9%

Home mortgage

2,305

Sales comparison approach

Market data comparison

0.5% to 15.1%

6.5%

December 31, 2022

Impaired loans:

SBA—real estate

423

Income approach - income capitalization

Capitalization rate

11.5%

(1)Weighted-average of inputs is based on the relative fair value of the respective assets as of June 30, 2023 and December 31, 2022.

Schedule of Carrying Amounts and Estimated Fair Values of Financial Instruments Not Carried at Fair Value

Financial Instruments: The carrying amounts and estimated fair values of financial instruments that are not carried at fair value on a recurring basis as of June 30, 2023 and December 31, 2022 are as follows. These financial assets and liabilities are measured at amortized cost basis on the Company’s Consolidated Balance Sheets:



	June 30, 2023
($ in thousands)	Carrying Amount		Level 1		Level 2		Level 3		Fair Value
Financial assets:
Cash and cash equivalents	$	143,761	$	143,761	$	—	$	—	$	143,761
Loans held for sale	—		—		—		—		—
Loans receivable, net	1,695,395		—		—		1,681,164		1,681,164
Accrued interest receivable, net	7,703		60		828		6,815		7,703
Other investments:
FHLB and PCBB stock	12,717		N/A		N/A		N/A		N/A
Time deposits placed	96		—		96		—		96
Servicing assets	12,654		—		—		18,177		18,177
Financial liabilities:
Deposits	1,859,639		—		1,856,997		—		1,856,997

Accrued interest payable	9,354		—		9,354		—		9,354



	December 31, 2022
($ in thousands)	Carrying Amount		Level 1		Level 2		Level 3		Fair Value
Financial assets:
Cash and cash equivalents	$	82,972	$	82,972	$	—	$	—	$	82,972
Loans held for sale	44,335		—		47,217		—		47,217
Loans receivable, net	1,659,051		—		—		1,626,036		1,626,036
Accrued interest receivable, net	7,180		51		716		6,413		7,180
Other investments:
FHLB and PCBB stock	8,673		N/A		N/A		N/A		N/A
Time deposits placed	95		—		95		—		95
Servicing assets	12,759		—		—		16,845		16,845
Financial liabilities:
Deposits	1,885,771		—		1,880,508		—		1,880,508

Accrued interest payable	2,771		—		2,771		—		2,771