Note 6 - Securities Available for Sale

3 Months Ended

Mar. 31, 2024

Notes to Financial Statements

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

(6) Securities Available For Sale

The following table shows the gross unrealized losses and fair values for the securities available for sale portfolio, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at March 31, 2024 and December 31, 2023.

	Less Than Twelve Months							Twelve Months or More							Total
(Dollars in thousands)	# of Investments		Fair Value		Unrealized Losses			# of Investments		Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
March 31, 2024
Mortgage backed securities:
Federal National Mortgage Association (FNMA)		0	$	0		0			34	$	82,474		(9,625	)	$	82,474		(9,625	)
Federal Home Loan Mortgage Corporation (FHLMC)		0		0		0			24		70,254		(8,398	)		70,254		(8,398	)
Collateralized mortgage obligations:
FNMA		0		0		0			1		31		(2	)		31		(2	)
Other marketable securities:
U.S. Government agency obligations		5		24,874		(76	)		4		19,679		(321	)		44,553		(397	)
Total temporarily impaired securities		5	$	24,874		(76	)		63	$	172,438		(18,346	)	$	197,312		(18,422	)

	Less Than Twelve Months							Twelve Months or More							Total
(Dollars in thousands)	# of Investments		Fair Value		Unrealized Losses			# of Investments		Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
December 31, 2023
Mortgage backed securities:
FNMA		0	$	0		0			34	$	87,133		(9,704	)	$	87,133		(9,704	)
FHLMC		0		0		0			24		74,249		(8,246	)		74,249		(8,246	)
Collateralized mortgage obligations:
FNMA		0		0		0			1		32		(2	)		32		(2	)
Other marketable securities:
U.S. government agency obligations		1		5,000		(9	)		7		34,456		(543	)		39,456		(552	)
Total temporarily impaired securities		1	$	5,000		(9	)		66	$	195,870		(18,495	)	$	200,870		(18,504	)

The Company reviews its investment portfolio on a quarterly basis for indications of impairment due to credit-related factors or noncredit-related factors and the Company does not intend to sell the securities and has the intent and ability to hold them for a period of time sufficient for recovery in their amortized cost basis. This review includes analyzing the extent to which the fair value has been lower than the cost, the market liquidity for the investment, the financial condition and near-term prospects of the issuer, including any specific events which may influence the operations of the issuer, and the Company’s intent and ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in fair value.

As of March 31, 2024, the Company did not consider the unrealized losses on its securities available for sale to be attributable to credit-related factors. All of the Company’s investments are issued by U.S. government agencies, are implicitly guaranteed by the U.S. government, and have a long history of no credit losses. The unrealized losses on impaired securities are the result of changes in interest rates. As a result, there was no allowance for credit losses required on available for sale debt securities in an unrealized loss position at March 31, 2024. During the three month periods ended March 31, 2024 and March 31, 2023, there were no sales of securities.

A summary of securities available for sale at March 31, 2024 and December 31, 2023 is as follows:

(Dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
March 31, 2024
Mortgage-backed securities:
FNMA	$	92,099		0		(9,625	)		82,474
FHLMC		78,652		0		(8,398	)		70,254
Collateralized mortgage obligations:
FNMA		33		0		(2	)		31
		170,784		0		(18,025	)		152,759
Other marketable securities:
U.S. Government agency obligations		54,221		26		(397	)		53,850
		54,221		26		(397	)		53,850
	$	225,005		26		(18,422	)		206,609
December 31, 2023
Mortgage-backed securities:
FNMA	$	96,837		0		(9,704	)		87,133
FHLMC		82,495		0		(8,246	)		74,249
Collateralized mortgage obligations:
FNMA		34		0		(2	)		32
		179,366		0		(17,952	)		161,414
Other marketable securities:
U.S. Government agency obligations		54,112		120		(552	)		53,680
		54,112		120		(552	)		53,680
	$	233,478		120		(18,504	)		215,094

The following table indicates amortized cost and estimated fair value of securities available for sale at March 31, 2024 based upon contractual maturity adjusted for scheduled repayments of principal and projected prepayments of principal based upon current economic conditions and interest rates.

(Dollars in thousands)	Amortized Cost		Fair Value
Due less than one year	$	64,284		60,418
Due after one year through five years		125,539		114,722
Due after five years through fifteen years		35,179		31,466
Due after fifteen years		3		3
Total	$	225,005		206,609

The allocation of mortgage-backed securities in the table above is based upon the anticipated future cash flow of the securities using estimated mortgage prepayment speeds. The allocation of other marketable securities that have call features is based on the anticipated cash flows to the expected call date if it is anticipated that the security will be called, or to the maturity date if it is not anticipated to be called.

The Company made an accounting policy election to exclude accrued interest receivable from the amortized cost basis of securities available for sale. Accrued interest receivable on securities available for sale is reported as a component of accrued interest receivable on the consolidated balance sheet and totaled $0.5 million at both March 31, 2024 and December 31, 2023 and these amounts are excluded from the estimated credit losses.

The Company had available for sale securities pledged as collateral for customer deposits in excess of the $250,000 insurance limit of the Federal Deposit Insurance Corporation. The securities pledged had a fair market value of $41.6 million at March 31, 2024 and December 31, 2023.