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Fair Value of Assets and liabilities (Tables)
 9 Months Ended
Sep. 30, 2023
Fair Value Disclosures [Abstract]  
Summary of Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following tables present the Company’s fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as of September 30, 2023 and December 31, 2022.

September 30, 2023
(Dollars in thousands)

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing deposits

 

$

—

 

 

$

1,250

 

 

$

—

 

 

$

1,250

 

Available for sale investment securities

 

 

—

 

 

 

53,175

 

 

 

—

 

 

 

53,175

 

Equity securities

 

 

1,671

 

 

 

—

 

 

 

—

 

 

 

1,671

 

Total (1)

 

$

1,671

 

 

$

54,425

 

 

$

—

 

 

$

56,096

 
(1)
Total unrealized losses of $1.2 million and $1.6 million, net of tax, was included in other comprehensive income for the three and nine months ended September 30, 2023 related to these assets.

December 31, 2022
(Dollars in thousands)

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing deposits

 

$

—

 

 

$

1,250

 

 

$

—

 

 

$

1,250

 

Available for sale investment securities

 

 

—

 

 

 

48,492

 

 

 

—

 

 

 

48,492

 

Equity securities

 

 

1,724

 

 

 

—

 

 

 

—

 

 

 

1,724

 

Total (1)

 

$

1,724

 

 

$

49,742

 

 

$

—

 

 

$

51,466

 
(1)
Total unrealized losses of $4.4 million, net of tax, was included in other comprehensive loss for the year ended December 31, 2022 related to these assets.
Summary of Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis

The following tables present the Company’s fair value hierarchy for those assets and liabilities measured at fair value on a non-recurring basis as of September 30, 2023 and December 31, 2022.

September 30, 2023
(Dollars in thousands)

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Equity investments

 

$

—

 

 

$

—

 

 

$

10,542

 

 

$

10,542

 

Impaired loans

 

 

—

 

 

 

—

 

 

 

20,648

 

 

 

20,648

 

Loan collateral in process of foreclosure

 

 

—

 

 

 

—

 

 

 

15,923

 

 

 

15,923

 

Total

 

$

—

 

 

$

—

 

 

$

47,113

 

 

$

47,113

 

 

December 31, 2022
(Dollars in thousands)

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Equity investments

 

$

—

 

 

$

—

 

 

$

10,293

 

 

$

10,293

 

Impaired loans

 

 

—

 

 

 

—

 

 

 

32,133

 

 

 

32,133

 

Loan collateral in process of foreclosure

 

 

—

 

 

 

—

 

 

 

21,819

 

 

 

21,819

 

Total

 

$

—

 

 

$

—

 

 

$

64,245

 

 

$

64,245

 
Summary of Valuation Techniques and Significant Unobservable Inputs Used in Non-Recurring Level 3 Fair Value Measurements of Assets and Liabilities

The valuation techniques and significant unobservable inputs used in non-recurring level 3 fair value measurements of assets and liabilities as of September 30, 2023 and December 31, 2022.

(Dollars in thousands except per share amounts)

 

Fair Value
at September 30, 2023

 

 

Valuation Techniques

 

Unobservable Inputs

 

Range
(Weighted Average)

Equity investments

 

$

10,269

 

 

Investee financial analysis

 

Financial condition and operating performance of the borrower (1)

 

N/A

 

 

 

 

 

 

 

Collateral support

 

N/A

 

 

 

273

 

 

Precedent market transaction

 

Offering price

 

$8.73 / share

Impaired loans

 

 

20,648

 

 

Market approach

 

Historical and actual loss experience

 

0.00% - 8.04%

 

 

 

 

 

 

 

Transfer prices (2)

 

$0.0 - 79.5

 

 

 

 

 

 

 

Collateral value

 

N/A

Loan collateral in process of foreclosure

 

 

15,923

 

 

Market approach

 

Transfer prices (2)

 

$0.0 - 79.5

 

 

 

 

 

 

 

Collateral value (3)

 

$2.9 - $43.2
(1)
Includes projections based on revenue, EBITDA, leverage, and liquidation amounts. These assumptions are based on a variety of factors, including economic conditions, industry, and market developments, market valuations of comparable companies, and company-specific developments, including exit strategies and realization opportunities.
(2)
Represents amount net of liquidation costs.
(3)
Relates to the recreation portfolio.

(Dollars in thousands except per share amounts)

 

Fair Value
at December 31, 2022

 

 

Valuation Techniques

 

Unobservable Inputs

 

Range
(Weighted Average)

Equity investments

 

$

10,020

 

 

Investee financial analysis

 

Financial condition and operating performance of the borrower (1)

 

N/A

 

 

 

 

 

 

 

Collateral support

 

N/A

 

 

 

273

 

 

Precedent market transaction

 

Offering price

 

$8.73 / share

Impaired loans

 

 

32,133

 

 

Market approach

 

Historical and actual loss experience

 

0.00% - 6.55%

 

 

 

 

 

 

 

 

 

60% of balance

 

 

 

 

 

 

 

Transfer prices (2)

 

$0.0 - $79.5

 

 

 

 

 

 

 

Collateral value

 

N/A

Loan collateral in process of foreclosure

 

 

21,819

 

 

Market approach

 

Transfer prices (2)

 

$0.0 - $79.5

 

 

 

 

 

 

 

Collateral value (3)

 

$2.5 - $54.1
(1)
Includes projections based on revenue, EBITDA, leverage, and liquidation amounts. These assumptions are based on a variety of factors, including economic conditions, industry, and market developments, market valuations of comparable companies, and company-specific developments, including exit strategies and realization opportunities.
(2)
Represents amount net of liquidation costs.
(3)
Relates to the recreation portfolio.