Securities

9 Months Ended

Sep. 30, 2024

Securities

Securities

Note 2:   Securities

Available-for-Sale (“AFS”) Securities

AFS securities are summarized as follows as of the dates indicated:

	September 30, 2024
			Gross		Gross
			Unrealized		Unrealized		Approximate
	Amortized Cost		Gains		Losses		Fair Value
	(Dollars in thousands)
Mortgage-backed - GSE residential	$	239,492	$	1,570	$	17,954	$	223,108
Collateralized mortgage obligations - GSE residential		97,029		1,285		518		97,796
State and political subdivisions		371,365		163		39,514		332,014
Small Business Administration loan pools		120,221		1,963		1		122,183
Corporate bonds		9,580		—		686		8,894
Total available-for-sale securities	$	837,687	$	4,981	$	58,673	$	783,995

	December 31, 2023
			Gross		Gross
			Unrealized		Unrealized		Approximate
	Amortized Cost		Gains		Losses		Fair Value
	(Dollars in thousands)
Federal agency obligations	$	9,988	$	84	$	—	$	10,072
U.S. Treasury securities		4,965		3		—		4,968
Mortgage-backed - GSE residential		233,203		629		21,370		212,462
Collateralized mortgage obligations - GSE residential		50,125		493		674		49,944
State and political subdivisions		396,349		497		40,949		355,897
Small Business Administration loan pools		125,017		722		961		124,778
Corporate bonds		9,740		—		1,208		8,532
Total available-for-sale securities	$	829,387	$	2,428	$	65,162	$	766,653

The carrying value of securities pledged as collateral was $45 million and $40 million at September 30, 2024 and December 31, 2023, respectively.

As of September 30, 2024 and December 31, 2023, the AFS securities had $6 million and $7 million, respectively, of accrued interest excluded from the amortized cost basis and presented in “interest receivable” on the consolidated statements of financial condition.

The following tables summarize the gross realized gains and losses from sales or maturities of AFS securities as of the dates shown:

For the Three Months Ended

For the Nine Months Ended

September 30, 2024

September 30, 2024

Gross

Gross

Net

Gross

Gross

Net

Realized

Realized

Realized

Realized

Realized

Realized

Gains

Losses

Gain

Gains

Losses

Gain

(Dollars in thousands)

Available-for-sale securities

$

158

$

(99)

$

59

$

163

$

(104)

$

59

For the Three Months Ended

For the Nine Months Ended

September 30, 2023

September 30, 2023

Gross

Gross

Net

Gross

Gross

Net

Realized

Realized

Realized

Realized

Realized

Realized

Gains

Losses

Loss

Gains

Losses

Gain

(Dollars in thousands)

Available-for-sale securities

$

68

$

(128)

$

(60)

$

335

$

(332)

$

3

The following tables summarize AFS securities gross unrealized losses, as of the dates shown, along with the length of time in an unrealized loss position:

	September 30, 2024
	Less than 12 Months					12 Months or More					Total
	Fair		Unrealized		Number of	Fair		Unrealized		Number of	Fair		Unrealized		Number of
	Value		Losses		Securities	Value		Losses		Securities	Value		Losses		Securities
	(Dollars in thousands)
Available-for-Sale Securities
Mortgage-backed - GSE residential	$	2,536	$	16	2	$	130,091	$	17,938	51	$	132,627	$	17,954	53
Collateralized mortgage obligations - GSE residential		30,667		69	5		11,499		449	17		42,166		518	22
State and political subdivisions		8,048		66	4		308,136		39,448	200		316,184		39,514	204
Small Business Administration loan pools		—		—	—		70		1	4		70		1	4
Corporate bonds		—		—	—		8,895		686	4		8,895		686	4
Total temporarily impaired AFS securities	$	41,251	$	151	11	$	458,691	$	58,522	276	$	499,942	$	58,673	287

	December 31, 2023
	Less than 12 Months					12 Months or More					Total
	Fair		Unrealized		Number of	Fair		Unrealized		Number of	Fair		Unrealized		Number of
	Value		Losses		Securities	Value		Losses		Securities	Value		Losses		Securities
	(Dollars in thousands)
Available-for-Sale Securities
Federal agency obligations	$	—	$	—	—	$	—	$	—	—	$	—	$	—	—
U.S. Treasury securities		—		—	—		—		—	—		—		—	—
Mortgage-backed - GSE residential		21,523		56	5		137,626		21,314	52		159,149		21,370	57
Collateralized mortgage obligations - GSE residential		17,707		135	4		8,469		539	17		26,176		674	21
State and political subdivisions		33,577		207	20		287,128		40,742	190		320,705		40,949	210
Small Business Administration loan pools		76,380		959	11		91		2	4		76,471		961	15
Corporate bonds		—		—	—		8,532		1,208	5		8,532		1,208	5
Total temporarily impaired AFS securities	$	149,187	$	1,357	40	$	441,846	$	63,805	268	$	591,033	$	65,162	308

Management evaluated all of the AFS securities in an unrealized loss position at September 30, 2024. The unrealized losses in the Company’s investment portfolio were primarily caused by interest rate changes. The Company does not intend to sell the investments, and it is not more likely than not the Company will be required to sell the investments before recovery of their amortized cost basis. The Company did not record any credit losses on AFS securities during the nine months ended September 30, 2024 or the year ended December 31, 2023.

The amortized cost, fair value, and weighted average yield of AFS securities by contractual maturity, are shown below:

	September 30, 2024
	Within			After One to			After Five to			After
	One Year			Five Years			Ten Years			Ten Years			Total
	(Dollars in thousands)
Available-for-sale securities
Mortgage-backed - GSE residential(1)
Amortized cost	$	—		$	—		$	775		$	238,717		$	239,492
Estimated fair value	$	—		$	—		$	730		$	222,378		$	223,108
Weighted average yield(2)		—	%		—	%		2.23	%		3.30	%		3.29	%
Collateralized mortgage obligations - GSE residential(1)
Amortized cost	$	—		$	1,990		$	17,915		$	77,124		$	97,029
Estimated fair value	$	—		$	1,942		$	18,046		$	77,808		$	97,796
Weighted average yield(2)		—	%		2.80	%		5.12	%		5.99	%		5.77	%
State and political subdivisions(1)
Amortized cost	$	519		$	3,331		$	58,405		$	309,110		$	371,365
Estimated fair value	$	532		$	3,344		$	57,785		$	270,353		$	332,014
Weighted average yield(2)		4.10	%		4.34	%		2.94	%		2.50	%		2.59	%
Small Business Administration loan pools(1)
Amortized cost	$	6		$	65		$	—		$	120,150		$	120,221
Estimated fair value	$	6		$	64		$	—		$	122,113		$	122,183
Weighted average yield(2)		5.01	%		4.10	%		—	%		4.96	%		4.96	%
Corporate bonds(1)
Amortized cost	$	—		$	88		$	9,492		$	—		$	9,580
Estimated fair value	$	—		$	85		$	8,809		$	—		$	8,894
Weighted average yield(2)		—	%		5.30	%		5.71	%		—	%		5.71	%
Total available-for-sale securities
Amortized cost	$	525		$	5,474		$	86,587		$	745,101		$	837,687
Estimated fair value	$	538		$	5,435		$	85,370		$	692,652		$	783,995
Weighted average yield(2)		4.11	%		3.79	%		3.69	%		3.51	%		3.53	%

⁽¹⁾ Actual maturities may differ from contractual maturities because issuers may have the rights to call or prepay obligations with or without prepayment penalties.

⁽²⁾ Yields are calculated based on amortized cost using 30/360 day basis. Tax-exempt securities are not tax effected.

Equity Securities

Equity securities consist of $7.3 million of private equity investments. Equity securities are included in other assets on the consolidated statements of financial condition.

The Company elected a measurement alternative for its private equity investments that did not have a readily determinable fair value and did not qualify for the practical expedient to estimate fair value using the net asset value per share. A cost basis was calculated for the equity investments. The recorded balance will adjust for any impairment or any observable price changes for an identical or similar investment of the same issuer. No such events occurred during the three- or nine-month periods ended September 30, 2024.

The following is a summary of the recorded fair value and the unrealized and realized gains and losses recognized in net income on equity securities:

	For the Three Months Ended				For the Nine Months Ended
	September 30,				September 30,
	2024		2023		2024		2023
	(Dollars in thousands)
Net gains recognized during the reporting period on equity securities	$	3	$	98	$	16	$	114
Less: net gains recognized during the period on equity securities sold during the period		—		93		18		93
Unrealized gain (loss) recognized during the reporting period on equity securities still held at the reporting date	$	3	$	5	$	(2)	$	21