SECURITIES

12 Months Ended

Dec. 31, 2024

SECURITIES

SECURITIES

NOTE 2 — SECURITIES

Debt Securities

There was no allowance for credit losses for debt securities available-for-sale as of December 31, 2024; therefore, it is not present in the table below. The amortized cost, related estimated fair value, and unrealized gains and losses for debt securities classified as Available-For-Sale were as follows at December 31, 2024 and 2023:

	Debt Securities Available-for-Sale
(Dollars in thousands)			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
December 31, 2024:	Cost		Gains		Losses		Value
U.S. Treasury securities	$	7,911	$	—	$	(760)	$	7,151
Obligations of U.S. Government Agencies and Sponsored Agencies:
Mortgage-backed		150,999		170		(14,461)		136,708
Other		5,080		78		(36)		5,122
Other mortgage backed securities		48,336		65		(2,128)		46,273
Obligations of state and political subdivisions		93,809		19		(10,343)		83,485
Asset-backed securities		74,006		263		(402)		73,867
Corporate debt securities		41,139		204		(3,661)		37,682
Total	$	421,280	$	799	$	(31,791)	$	390,288

	Debt Securities Available-for-Sale
(Dollars in thousands)			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
December 31, 2023:	Cost		Gains		Losses		Value
U.S. Treasury securities	$	7,881	$	—	$	(840)	$	7,041
Obligations of U.S. Government Agencies and Sponsored Agencies:
Mortgage-backed		152,510		—		(14,518)		137,992
Other		7,560		126		(54)		7,632
Other mortgage backed securities		36,623		168		(2,741)		34,050
Obligations of state and political subdivisions		97,899		18		(10,214)		87,703
Asset-backed securities		82,852		150		(840)		82,162
Corporate debt securities		40,647		74		(4,333)		36,388
Total	$	425,972	$	536	$	(33,540)	$	392,968

Debt securities available-for-sale with an aggregate fair value of $251,961,000 at December 31, 2024 and $249,114,000 at December 31, 2023, were pledged to secure public funds, trust funds, securities sold under agreements to repurchase and the Federal Discount Window aggregating $192,671,000 at December 31, 2024 and $182,050,000 at December 31, 2023.

The amortized cost and fair value of securities, by contractual maturity, are shown below at December 31, 2024. 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.

(Dollars in thousands)	Available-for-Sale
	Amortized
	Cost		Fair Value
1 year or less	$	9,946	$	9,895
Over 1 year through 5 years		19,845		18,719
Over 5 years through 10 years		69,650		63,438
Over 10 years		122,504		115,255
Mortgage-backed securities		199,335		182,981
Total	$	421,280	$	390,288

At December 31, 2024 and 2023, the Corporation had holdings of securities from the following issuers in excess of ten percent of consolidated stockholders’ equity (excluding holdings of the U.S. Government and U.S. Government Agencies and Corporations).

(Dollars in thousands)
	Fair
December 31, 2024:	Value
Issuer
Sallie Mae Bank	$	26,187
Velocity Commercial Capital		23,334
Nelnet Student Loan Trust		15,008
Navient Student Loan Trust		10,726

(Dollars in thousands)
	Fair
December 31, 2023:	Value
Issuer
Sallie Mae Bank	$	25,737
Nelnet Student Loan Trust		15,486
Navient Student Loan Trust		13,179

Proceeds from sales of investments in debt securities available-for-sale during 2024 and 2023 were $0 and $23,230,000 respectively. Gross gains realized on these sales were $0 and $447,000 respectively. Gross losses on these sales were $0 and $348,000 respectively.

The summary below shows the gross unrealized losses and fair value of the Corporation’s debt securities, aggregated by investment category, of which individual securities have been in a continuous unrealized loss position for less than 12 months or 12 months or more as of December 31, 2024 and 2023:

December 31, 2024

(Dollars in thousands)	Less Than 12 Months				12 Months or More				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
Available-for-Sale:	Value		Loss		Value		Loss		Value		Loss
U.S. Treasury securities	$	—	$	—	$	7,151	$	(760)	$	7,151	$	(760)
Obligations of U.S. Government Agencies and Sponsored Agencies:
Mortgage-backed		20,726		(570)		81,217		(13,891)		101,943		(14,461)
Other		—		—		1,927		(36)		1,927		(36)
Other mortgage-backed debt securities		21,700		(560)		19,001		(1,568)		40,701		(2,128)
Obligations of state and political subdivisions		243		(7)		79,684		(10,336)		79,927		(10,343)
Asset-backed securities		7,791		(33)		16,280		(369)		24,071		(402)
Corporate debt securities		7,209		(1,178)		25,594		(2,483)		32,803		(3,661)
Total	$	57,669	$	(2,348)	$	230,854	$	(29,443)	$	288,523	$	(31,791)

December 31, 2023

(Dollars in thousands)	Less Than 12 Months				12 Months or More				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
Available-for-Sale:	Value		Loss		Value		Loss		Value		Loss
U.S. Treasury securities	$	—	$	—	$	7,041	$	(840)	$	7,041	$	(840)
Obligations of U.S. Government Agencies and Sponsored Agencies:
Mortgage-backed		23,103		(242)		102,608		(14,276)		125,711		(14,518)
Other		—		—		3,029		(54)		3,029		(54)
Other mortgage-backed debt securities		1,568		(1)		25,042		(2,740)		26,610		(2,741)
Obligations of state and political subdivisions		—		—		82,113		(10,214)		82,113		(10,214)
Asset-backed securities		52,862		(342)		12,726		(498)		65,588		(840)
Corporate debt securities		2,813		(270)		30,501		(4,063)		33,314		(4,333)
Total	$	80,346	$	(855)	$	263,060	$	(32,685)	$	343,406	$	(33,540)

There were 167 individual debt securities in an unrealized loss position as of December 31, 2024, with a combined decline in value representing 7.36% of the debt securities portfolio. There were 177 individual debt securities in an unrealized loss position as of December 31, 2023, with their combined decline in value representing 7.75% of the debt securities portfolio.

The Corporation made a policy election to exclude accrued interest receivable from the amortized cost basis of debt securities available for sale. Accrued interest receivable on debt securities available for sale is reported as a component of accrued interest receivable on the Corporation’s consolidated balance sheet and totaled $2,142,000 as of December 31, 2024. Accrued interest receivable on debt securities available for sale is excluded from the estimate of credit losses.

All debt securities available for sale in an unrealized loss position, as of December 31, 2024, continue to perform as scheduled and the Corporation does not believe that there is a credit loss or that a provision for credit losses is necessary. Also, as part of the Corporation’s evaluation of its intent and ability to hold debt securities for a period of time sufficient to allow for any anticipated recovery in the market, the Corporation considers its investment strategies, cash flow needs, liquidity position, capital adequacy and interest rate risk position. The Corporation does not currently

intend to sell the debt securities within the portfolio and it is not more-likely-than-not that the Corporation will be required to sell the debt securities.

Management continues to monitor all of our debt securities with a high degree of scrutiny. There can be no assurance that the Corporation will not conclude in future periods that conditions existing at that time indicate some or all of its debt securities may be sold or would require a charge to earnings as a provision for credit losses in such periods.

Equity Securities

At December 31, 2024 and 2023, the Corporation had $1,587,000 and $1,482,000, respectively, in equity securities recorded at fair value. The following is a summary of unrealized and realized gains and losses recognized in net income on equity securities during 2024 and 2023:

(Dollars in thousands)
	December 31, 2024		December 31, 2023
Net gains (losses) from market value fluctuations recognized during the period on equity securities	$	105	$	(217)
Less: Net gains recognized during the period on equity securities sold during the period		—		—
Net gains (losses) recognized during the reporting period on equity securities still held at the reporting date	$	105	$	(217)

The Corporation monitors the equity securities portfolio monthly with particular attention given to securities in a continuous loss position of at least ten percent for over twelve months. Based on the factors described above, management did not consider any equity securities to be impaired at December 31, 2024 or 2023.