Investment Securities

12 Months Ended

Dec. 31, 2023

Investments, Debt and Equity Securities [Abstract]

Investment Securities

Note 4 – Investment Securities

The following tables summarize the amortized cost and estimated fair value of securities available-for-sale at December 31, 2023 and December 31, 2022 with gross unrealized gains and losses therein:

	December 31, 2023
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Available-for-sale			(In thousands)
Mortgage-backed securities - U.S. government sponsored enterprises (GSEs)	$	48,399	$	219	$	(5,984	)	$	42,634
U.S. government agency securities		6,260		—		(969	)		5,291
Obligations of state and political subdivisions		44,059		12		(3,262	)		40,809
Small business association (SBA) securities		2,617		2		(1	)		2,618
Total	$	101,335	$	233	$	(10,216	)	$	91,352

	December 31, 2022
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Available-for-sale			(In thousands)
Mortgage-backed securities - U.S. government sponsored enterprises (GSEs)	$	41,515	$	2	$	(6,602	)	$	34,915
U.S. government agency securities		6260		—		(1,175	)		5,085
Obligations of state and political subdivisions		45,161		8		(3,828	)		41,341
Total	$	92,936	$	10	$	(11,605	)	$	81,341

The unrealized losses, categorized by the length of time in a continuous loss position, and the fair value of related securities available-for-sale as of December 31, 2023 and December 31, 2022 are as follows:

	Less than 12 Months					More than 12 Months					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
December 31, 2023	(In thousands)
Mortgage-backed securities - U.S. government sponsored enterprises (GSEs)	$	2,858	$	(14	)	$	31,398	$	(5,970	)	$	34,256	$	(5,984	)
U.S. government agency securities		—		—			5,291		(969	)		5,291		(969	)
Obligations of state and political subdivisions		5,117		(102	)		30,646		(3,160	)		35,763		(3,262	)
Small business association (SBA) securities		723		(1	)		—		—			723		(1	)
Total	$	8,698	$	(117	)	$	67,335	$	(10,099	)	$	76,033	$	(10,216	)

	Less than 12 Months					More than 12 Months					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
December 31, 2022	(In thousands)
Mortgage-backed securities - U.S. government sponsored enterprises (GSEs)	$	15,605	$	(1,778	)	$	19,137	$	(4,824	)	$	34,742	$	(6,602	)
U.S. government agency securities		—		—			5,085		(1,175	)		5,085		(1,175	)
Obligations of state and political subdivisions		36,421		(3,457	)		1,352		(371	)		37,773		(3,828	)
Total	$	52,026	$	(5,235	)	$	25,574	$	(6,370	)	$	77,600	$	(11,605	)

Accrued interest receivable for investment securities was $523,000 and $487,000 at December 31, 2023 and 2022, respectively. Debt securities are placed on nonaccrual status and accrued interest is reversed at the time any principal or interest payments become 90 days delinquent. There were no past due securities at December 31, 2023 or 2022.

On January 1, 2023, the Company adopted ASC 326 and implemented the CECL methodology for allowance for credit losses. The new CECL methodology replaces the other-than-temporary impairment model that previously existed. Adoption of this guidance did not have a CECL day 1 impact attributable to its investment securities portfolio and the Company did not have an allowance for credit losses on its investment securities available for sale as of December 31, 2023.

The Company’s securities primarily consist of the following types of instruments; U.S. guaranteed mortgage-backed securities, U.S guaranteed agency bonds and state and political subdivision issued bonds. We believe it is reasonable to expect that the securities with a credit guarantee of the U.S. government, will have a zero-credit loss. Therefore, no reserve was recorded for U.S. guaranteed securities or bonds at December 31, 2023. The state and political subdivision securities carry a minimum investment rating of A. Some of the smaller municipalities also have insurance to cover the Company in the event of default. Therefore, the Company expects to have a zero-credit loss and no reserve was recorded as of December 31, 2023.

At December 31, 2023, there were a total of 188 securities in an unrealized loss position, including 73 mortgage-backed securities, 107 obligations of state and political subdivisions and eight U.S. government agency securities in the securities available-for-sale portfolio. The securities had unrealized losses totaling $10.2 million, or 11.84% of their amortized cost basis.

The Company does not intend to sell these securities and it is not more likely than not that we will be required to sell these securities. Unrealized losses primarily relate to interest rate fluctuations and not credit-related criteria. No credit charges were recorded for the years ended December 31, 2023 and 2022.

The amortized cost and estimated fair value of securities available-for-sale at December 31, 2023 by contractual maturity are shown below. Expected maturities will differ from contractual maturities as borrowers may have the right to call or prepay obligations with or without call or prepayment penalties:

	Amortized Cost		Fair Value
	(In thousands)
Due in one year or less	$	—	$	—
Due after one year through five years		8,538		8,415
Due after five years through ten years		29,382		27,040
Due after ten years		12,399		10,645
Mortgage-backed securities (GSEs)		48,399		42,634
Small business association (SBA) securities		2,617		2,618
	$	101,335	$	91,352

There were no sales of available-for-sale securities for the twelve months ended December 31, 2023. Proceeds from the calls and maturities of securities available-for-sale amounted to $1.6 million for the twelve months ended December 31, 2023, which included approximately $39,000 in gross realized gains. There were no sales of available-for-sale securities for the twelve months ended December 31, 2022. Proceeds from the calls and maturities of securities available-for-sale amounted to $3.7 million for the twelve months ended December 31, 2022, which included approximately $2,000 in gross realized gains.

There were no securities pledged as collateral for NJ Governmental Unit Deposit Protection Act (“GUDPA”) deposits at December 31, 2023 or 2022.