INVESTMENT SECURITIES

3 Months Ended

Mar. 31, 2025

INVESTMENT SECURITIES

INVESTMENT SECURITIES

2. INVESTMENT SECURITIES

Available-for-Sale Debt Securities

The following tables summarize the amortized cost, fair value, and ACLS of AFS debt securities and the corresponding amounts of related gross unrealized gains and losses recognized in AOCI:

			Gross		Gross		Allowance
	Amortized		Unrealized		Unrealized		for		Fair
March 31, 2025 (in thousands)	Cost		Gains		Losses		Credit Losses		Value
U.S. Treasury securities and U.S. Government agencies	$	350,261	$	91	$	(4,656)	$	—	$	345,696
Private label mortgage-backed security		74		1,441		—		—		1,515
Mortgage-backed securities - residential		247,077		436		(10,183)		—		237,330
Collateralized mortgage obligations		19,451		28		(769)		—		18,710
Corporate bonds		2,006		—		(3)		—		2,003
Trust preferred security		3,879		194		—		—		4,073
Total available-for-sale debt securities	$	622,748	$	2,190	$	(15,611)	$	—	$	609,327

			Gross		Gross		Allowance
	Amortized		Unrealized		Unrealized		for		Fair
December 31, 2024 (in thousands)	Cost		Gains		Losses		Credit Losses		Value
U.S. Treasury securities and U.S. Government agencies	$	395,609	$	4	$	(6,527)	$	—	$	389,086
Private label mortgage-backed security		121		1,429		—		—		1,550
Mortgage-backed securities - residential		180,765		193		(12,725)		—		168,233
Collateralized mortgage obligations		20,127		27		(911)		—		19,243
Corporate bonds		2,008		1		—		—		2,009
Trust preferred security		3,863		171		—		—		4,034
Total available-for-sale debt securities	$	602,493	$	1,825	$	(20,163)	$	—	$	584,155

Held-to-Maturity Debt Securities

The following tables summarize the amortized cost, fair value, and ACLS of HTM debt securities and the corresponding amounts of related gross unrecognized gains and losses:

			Gross		Gross				Allowance
	Amortized		Unrecognized		Unrecognized		Fair		for
March 31, 2025 (in thousands)	Cost		Gains		Losses		Value		Credit Losses
U.S. Treasury securities and U.S. Government agencies	$	—	$	—	$	—	$	—	$	—
Mortgage-backed securities - residential		14		—		—		14		—
Collateralized mortgage obligations		5,598		33		(80)		5,551		—
Corporate bonds		—		—		—		—		—
Obligations of state and political subdivisions		—		—		—		—		—
Total held-to-maturity debt securities	$	5,612	$	33	$	(80)	$	5,565	$	—

			Gross		Gross				Allowance
	Amortized		Unrecognized		Unrecognized		Fair		for
December 31, 2024 (in thousands)	Cost		Gains		Losses		Value		Credit Losses
U.S. Treasury securities and U.S. Government agencies	$	—	$	—	$	—	$	—	$	—
Mortgage-backed securities - residential		23		1		—		24		—
Collateralized mortgage obligations		5,756		36		(86)		5,706		—
Corporate bonds		4,999		6		—		5,005		—
Obligations of state and political subdivisions		—		—		—		—		—
Total held-to-maturity debt securities	$	10,778	$	43	$	(86)	$	10,735	$	—

Sales of Available-for-Sale Debt Securities

During the three months ended March 31, 2025 and 2024, there were no material gains or losses on sales or calls of AFS debt securities.

Debt Securities by Contractual Maturity

The amortized cost and fair value of debt securities by contractual maturity as of March 31, 2025 follow. Expected maturities may differ from contractual maturities if borrowers have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are detailed separately.

	Available-for-Sale				Held-to-Maturity
	Debt Securities				Debt Securities
	Amortized		Fair		Amortized		Fair
March 31, 2025 (in thousands)	Cost		Value		Cost		Value
Due in one year or less	$	125,311	$	124,280	$	—	$	—
Due from one year to five years		216,956		213,421		—		—
Due from five years to ten years		10,000		9,998		—		—
Due beyond ten years		3,879		4,073		—		—
Private label mortgage-backed security		74		1,515		—		—
Mortgage-backed securities - residential		247,077		237,330		14		14
Collateralized mortgage obligations		19,451		18,710		5,598		5,551
Total debt securities	$	622,748	$	609,327	$	5,612	$	5,565

Unrealized-Loss Analysis on Debt Securities

The following tables summarize AFS debt securities in an unrealized loss position for which an ACLS had not been recorded as of March 31, 2025 and December 31, 2024, aggregated by investment category and length of time in a continuous unrealized loss position:

	Less than 12 months				12 months or more				Total
			Unrealized				Unrealized				Unrealized
March 31, 2025 (in thousands)	Fair Value		Losses		Fair Value		Losses		Fair Value		Losses
Available-for-sale debt securities:
U.S. Treasury securities and U.S. Government agencies	$	79,927	$	(40)	$	185,360	$	(4,616)	$	265,287	$	(4,656)
Mortgage-backed securities - residential		48,192		(295)		109,966		(9,888)		158,158		(10,183)
Collateralized mortgage obligations		3,070		(158)		13,784		(611)		16,854		(769)
Corporate bonds		2,003		(3)		—		—		2,003		(3)
Trust preferred security		—		—		—		—		—		—
Total available-for-sale debt securities	$	133,192	$	(496)	$	309,110	$	(15,115)	$	442,302	$	(15,611)

	Less than 12 months				12 months or more				Total
			Unrealized				Unrealized				Unrealized
December 31, 2024 (in thousands)	Fair Value		Losses		Fair Value		Losses		Fair Value		Losses
Available-for-sale debt securities:
U.S. Treasury securities and U.S. Government agencies	$	145,048	$	(212)	$	209,033	$	(6,315)	$	354,081	$	(6,527)
Mortgage-backed securities - residential		52,347		(874)		104,453		(11,851)		156,800		(12,725)
Collateralized mortgage obligations		700		(8)		15,951		(903)		16,651		(911)
Trust preferred security		—		—		—		—		—		—
Total available-for-sale debt securities	$	198,095	$	(1,094)	$	329,437	$	(19,069)	$	527,532	$	(20,163)

As of March 31, 2025, the Bank’s security portfolio consisted of 182 securities of which 103 securities were in an unrealized loss position.

As of December 31, 2024, the Bank’s security portfolio consisted of 182 securities of which 114 securities were in an unrealized loss position.

As of March 31, 2025 and December 31, 2024, there were no holdings of debt securities of any one issuer, other than the U.S. government and its agencies, in an amount greater than 10% of stockholders’ equity.

Mortgage-Backed Securities and Collateralized Mortgage Obligations

As of March 31, 2025, with the exception of one private label mortgage-backed security with an amortized cost of $74,000, all other mortgage-backed securities and CMOs held by the Bank were issued by U.S. government-sponsored entities and agencies, primarily the FHLMC and FNMA. As of March 31, 2025 and December 31, 2024, there were gross unrealized losses of $11.0 million and $13.6 million related to AFS mortgage-backed securities and CMOs. Because these unrealized losses are attributable to changes in interest rates and illiquidity, and not credit quality, and because the Bank does not have the intent to sell these securities and it is likely that it will not be required to sell the securities before their anticipated recovery, management does not consider these securities to have credit-related impairment that would require a provision adjustment to the ACLS.

Roll-forward of the Allowance for Credit Losses on Debt Securities

The tables below present a roll-forward for the three months ended March 31, 2025 and 2024 of the ACLS on AFS and HTM debt securities:

	ACLS Roll-forward
	Three Months Ended March 31,
	2025										2024
	Beginning				Charge-				Ending			Beginning				Charge-				Ending
(in thousands)	Balance		Provision		offs		Recoveries		Balance			Balance		Provision		offs		Recoveries		Balance
Available-for-Sale Securities:
Corporate Bonds	$	—	$	—	$	—	$	—	$	—		$	—	$	—	$	—	$	—	$	—
Held-to-Maturity Securities:
Corporate Bonds		—		—		—		—		—			10		—		—		—		10
Total	$	—	$	—	$	—	$	—	$	—		$	10	$	—	$	—	$	—	$	10

There were no HTM debt securities on nonaccrual or past due 90 days or more as of March 31, 2025 and December 31, 2024. All of the Company’s HTM corporate bonds were rated investment grade as of March 31, 2025 and December 31, 2024.

There were no HTM debt securities considered collateral dependent as of March 31, 2025 and December 31, 2024.

Accrued interest on AFS debt securities is presented as a component of other assets on the Company’s balance sheet and is excluded from the ACLS. Accrued interest on AFS debt securities totaled $4 million and $3 million as of March 31, 2025 and December 31, 2024. Accrued interest receivable on HTM debt securities totaled $14,000 and $60,000 as of March 31, 2025 and December 31, 2024.

Pledged Debt Securities

Debt securities pledged to secure public deposits, securities sold under agreements to repurchase, and debt securities held for other purposes, as required or permitted by law, were as follows:

	As of
(in thousands)	March 31, 2025		December 31, 2024
Amortized cost	$	204,867	$	205,160
Fair value		200,550		199,607
Carrying amount		200,550		199,607

Equity Securities

The carrying value, gross unrealized gains and losses, and fair value of equity securities with readily determinable fair values were as follows:

			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
March 31, 2025 (in thousands)	Cost		Gains		Losses		Value
Freddie Mac preferred stock	$	—	$	724	$	—	$	724
Total equity securities with readily determinable fair values	$	—	$	724	$	—	$	724

			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
December 31, 2024 (in thousands)	Cost		Gains		Losses		Value
Freddie Mac preferred stock	$	—	$	693	$	—	$	693
Total equity securities with readily determinable fair values	$	—	$	693	$	—	$	693

For equity securities with readily determinable fair values, the gross realized and unrealized gains and losses recognized in the Company’s consolidated statements of income were as follows:

	Gains (Losses) Recognized on Equity Securities
	Three Months Ended March 31, 2025						Three Months Ended March 31, 2024
(in thousands)	Realized		Unrealized		Total		Realized		Unrealized		Total
Freddie Mac preferred stock	$	—	$	31	$	31	$	—	$	61	$	61
Total equity securities with readily determinable fair value	$	—	$	31	$	31	$	—	$	61	$	61