What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2025-05-02 compared with 2024-11-01 · 182 added, 337 removed, 739 unchanged (41% of the section changed)

4 unchanged sentences

Consolidated Balance Sheets

September 30,

(Dollars in thousands, except share data)

11 unchanged sentences

Total deposits

Federal funds purchased and securities sold under agreements to repurchase

Accrued expenses and other liabilities

8 unchanged sentences

Less treasury stock, at cost -

at September 30, 2024

shares at both March 31, 2025

and December 31, 2024, respectively

6 unchanged sentences

Consolidated Statements of Earnings

Quarter ended September 30,

Nine months ended September 30,

Quarter ended March 31,

(Dollars in thousands, except share and per share data)

7 unchanged sentences

Net interest income

Provision for (reversal of) credit losses

Provision for credit losses

Net interest income after provision for credit

19 unchanged sentences

AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income

Quarter ended September 30,

Nine months ended September 30,

Consolidated Statements of Comprehensive Income (Loss)

Quarter ended March 31,

(Dollars in thousands)

Other comprehensive income (loss):

Unrealized gain (loss) on securities

Related tax (expense) benefit

Other comprehensive income (loss), net of tax:

Unrealized net holding gain (loss) on securities, net of

tax expense of $

and tax benefit of $

, respectively

Other comprehensive income (loss)

Comprehensive income (loss)

6 unchanged sentences

(Dollars in thousands, except share data)

income (loss)

Quarter ended September 30, 2024

Balance, June 30, 2024

Other comprehensive income

Cash dividends paid ($

Balance, September 30, 2024

Quarter ended September 30, 2023

Balance, June 30, 2023

Other comprehensive loss

Cash dividends paid ($

Stock repurchases

Sale of treasury stock

Balance, September 30, 2023

Nine months ended September 30, 2024

Quarter ended March 31, 2025

Balance, December 31, 2024

Cumulative effect of change in accounting

standard ASC 326

Other comprehensive income

Cash dividends paid ($

Sale of treasury stock

Balance, September 30, 2024

Nine months ended September 30, 2023

Balance, March 31, 2025

Quarter ended March 31, 2024

Balance, December 31, 2023

Cumulative effect of change in accounting

standard ASU 2023-12

Other comprehensive loss

Cash dividends paid ($

Stock repurchases

Sale of treasury stock

Balance, September 30, 2023

Balance, March 31, 2024

See accompanying notes to consolidated financial statements

3 unchanged sentences

Consolidated Statements of Cash Flows

Nine months ended September 30,

Quarter ended March 31,

(Dollars in thousands)

2 unchanged sentences

operating activities:

Provision for (reversal of) credit losses

Provision for credit losses

Depreciation and amortization

4 unchanged sentences

Increase in cash surrender value of bank-owned life insurance

Income recognized from death benefit on bank-owned life insurance

Net (increase) decrease in other assets

Net increase in accrued expenses and other liabilities

Net decrease (increase) in other assets

Net (decrease) increase in accrued expenses and other liabilities

Net cash provided by operating activities

1 unchanged sentence

Proceeds from prepayments and maturities of securities available-for-sale

Increase in loans, net

Decrease (increase) in loans, net

Net purchases of premises and equipment

Proceeds from bank-owned life insurance death benefit

Proceeds from surrender of bank-owned life insurance

Decrease (increase) in FHLB stock

Decrease in FHLB stock

Net cash provided by (used in) investing activities

Cash flows from financing activities:

Net decrease in noninterest-bearing deposits

Net increase (decrease) in noninterest-bearing deposits

Net increase in interest-bearing deposits

Net decrease in federal funds purchased and securities sold

Net increase in federal funds purchased and securities sold

under agreements to repurchase

Stock repurchases

Dividends paid

62 unchanged sentences

deposits, ATM

interchange fees and gains and losses on sales of other real estate, all of which

are presented as components of noninterest

The following is a summary of the revenue streams that fall within

the scope of ASC 606:

interchange fees and gains and losses on sales of OREO, all of which

are presented as components of noninterest income.

The following is a summary of the revenue streams that fall within the scope

Service charges on deposits, investment services, ATM

22 unchanged sentences

transactions through the date of this filing that have occurred

subsequent to September 30, 2024.

subsequent to March 31, 2025.

The Company does not believe there were any material subsequent events during

period that would have required further recognition or disclosure in the

unaudited consolidated financial statements

period that would have required further recognition or disclosure in

the unaudited consolidated financial statements

included in this report.

Correction of Error

The disclosure of loans by vintage in Note 5 – Loans and Allowance for Credit

Losses in the Company’s Annual

Form 10-K for year ended December 31, 2023 contained incorrect

information as it pertains to loans originated by vintage

and revolving loans.

All current period gross charge-off data, total loans by segment

and total loans by credit quality

indicator were correctly reported.

The loans originated by vintage and revolving loans as of December 31, 2023 have been

corrected in the comparative presentation in Note 5 – Loans and Allowance

for Credit Losses in the Notes herein.

Reclassifications

Certain amounts reported in prior periods have been reclassified to

conform to the current-period presentation.

reclassifications had no effect on the Company’s

previously reported net earnings or total stockholders’ equity.

Accounting Standards Adopted in 2024

On January 1, 2024, the Company adopted ASU 2023-02,

Investments – Equity Method and Joint Ventures

Accounting for Investments in Tax

Credit Structures Using

the Proportional Amortization Method

ASU 2023-02 now

permits reporting entities to elect to account for their equity investments made

primarily to receive income tax credits and

other income tax benefits, regardless of the program from which the income

tax credits or benefits are received, using the

proportional amortization method if certain conditions are met.

new standard is effective for fiscal years, and interim

periods within those fiscal years, beginning after December 15,

The Company adopted ASU 2023-02 effective

January 1, 2024 and recorded a cumulative effect of change in accounting

standard adjustment which reduced beginning

retained earnings by $0.3 million.

The Company, beginning January

1, 2024, accounts

for its investments in New Markets

Tax Credits (“NMTCs”) using

the proportional amortization method through charges to

the provision for income taxes.

Note 3, Variable

Interest Entities.

Accounting Developments

In the first quarter of 2025, the Company did not adopt any new accounting

BASIC AND DILUTED NET EARNINGS PER SHARE

1 unchanged sentence

average common shares outstanding for

the respective period.

Diluted net earnings per share reflect the potential dilution that could occur upon

securities or other rights for, or convertible into,

shares of the Company’s common stock.

At September 30, 2024 and

2023, respectively,

the Company had no such securities or rights issued or outstanding, and therefore, no dilutive

consider for the diluted net earnings per share calculation.

the quarters ended March 31, 2025 and 2024, respectively.

Diluted net earnings per share reflect the potential dilution that

could occur upon exercise of securities or other rights for,

or convertible into, shares of the Company’s

common stock.

March 31, 2025 and 2024, respectively,

the Company had no such securities or rights issued or outstanding, and therefore,

no dilutive effect to consider for the diluted net earnings per share calculation.

The basic and diluted net earnings per share computations for the respective

periods are presented below

Quarter ended September 30,

Nine months ended September 30,

Quarter ended March 31,

(Dollars in thousands, except share and per share data)

3 unchanged sentences

Net earnings per share

INTEREST ENTITIES

Generally, a variable interest

entity (“VIE”) is a corporation, partnership, trust or other legal structure that

does not have

equity investors with substantive or proportional voting rights or has equity

investors that do not provide sufficient financial

resources for the entity to support its activities.

At September 30, 2024, the Company did not have any consolidated VIEs but did

have one nonconsolidated VIE, discussed

New Markets Tax

Credit Investment

September 30,

2024 and December

31, 2023, respectively,

investment of $1.0

million and $1.7

million, respectively,

which was included in other assets in the Company’s

consolidated balance sheets as a VIE.

investment exceeds

the outstanding

equity interest

not consolidate

direct the activities

not a primary

beneficiary of

On March 29, 2023, the FASB

issued ASU 2023-02, which was effective beginning in 2024

for public business entities.

proportional amortization

method results

tax credit investment

being amortized

in proportion

to the allocation

credits and other

tax benefits in each

net presentation within

the income tax

The cumulative effects

January 1, 2024.

Summary of Significant Accounting Policies – Accounting Standards

Adopted in 2024.

(Dollars in thousands)

Loss Exposure

Asset Recognized

Classification

New Markets Tax Credit

At September 30, 2024 and December 31, 2023, respectively,

At March 31, 2025 and December 31, 2024, respectively,

all securities within the scope of ASC 320,

Investments –

Debt and Equity Securities,

Investments – Debt

and Equity Securities,

were classified as available-for-sale.

The fair value and amortized cost for securities available-

for-sale by contractual maturity at September 30, 2024

and December 31, 2023, respectively,

are presented below.

The fair value and amortized cost for securities available-for-

sale by contractual maturity at March 31, 2025 and December 31, 2024,

respectively, are presented

Gross Unrealized

(Dollars in thousands)

September 30, 2024

March 31, 2025

Agency obligations (a)

13 unchanged sentences

have the right to call or repay such securities

obligations with or without prepayment penalties and (ii) loans incuded in Agency

MBS generally have the right to

prepay such loan in whole or in part at any time.

obligations with or without prepayment penalties and (ii) borrowers of

the loans included in Agency MBS generally

have the right to prepay such loan in whole or in part at any time.

Securities with aggregate fair values of $

million and $

at September 30, 2024 and December 31, 2023,

respectively, were

pledged to secure public deposits, securities sold under agreements to repurchase,

Federal Home Loan

Bank of Atlanta (“FHLB of Atlanta”) advances, and for other purposes required

or permitted by law.

at March 31, 2025 and December 31, 2024, respectively,

were pledged to secure public deposits,

securities sold under agreements to repurchase, FHLB advances, and for

purposes required or permitted by law.

Included in other assets on the accompanying consolidated balance sheets include

1 unchanged sentence

carrying amounts of non-marketable equity investments were $

million at September 30, 2024 and December 31, 2023,

million at March 31, 2025 and December 31, 2024,

respectively.

3 unchanged sentences

Gross Unrealized Losses and Fair Value

The fair values and gross unrealized losses on securities at September

The fair values and gross unrealized losses on securities at March 31, 2025

and December 31, 2024, respectively,

5 unchanged sentences

(Dollars in thousands)

September 30, 2024:

March 31, 2025:

Agency obligations

3 unchanged sentences

State and political subdivisions

For the securities in the previous table, the Company considers the severity of

the unrealized loss as well as the Company’s

intent to hold the securities to maturity or the recovery of the cost basis.

Unrealized losses have not been recognized into

income as the decline in fair value is largely due to changes in interest rates

and other market conditions.

For the securities

held as of September 30, 2024 in the table immediately above, management

does not intend to sell and it is likely that

management will not be required to sell the securities prior to their recovery.

Agency Obligations

Investments in agency obligations are guaranteed as to full and timely

payment of principal and interest by the issuing

Based on management's analysis and judgement, there were no credit losses attributable

to the Company’s

investments in agency obligations at September 30, 2024.

Investments in agency mortgage-backed securities (“MBS”) are MBS issued by

Ginnie Mae, Fannie Mae, and Freddie

Each of these agencies provide a guarantee of full and timely payments of principal and

interest on their respective

MBS by the issuing agency.

Based on management's analysis and judgement, there were no

credit losses attributable to the

Company’s investments

in agency MBS at September 30, 2024.

State and Political Subdivisions

Investments in state and political subdivisions are securities issued by

various municipalities in the United States.

majority of these securities were rated AA or higher,

with no securities rated below investment grade at September 30,

Based on management's analysis and judgement, there were no credit losses attributable

to the Company’s

investments in state and political subdivisions at September 30, 2024.

For the securities in the previous table, the Company assesses whether or not

it intends to sell the security, or more

than not will be required to sell the security,

before recovery of its amortized cost basis which would require a write-down

to fair value through net income.

Because the Company currently does not intend to sell those securities that have an

unrealized loss at March 31, 2025, and it is not more-likely-than-not that the

Company will be required to sell the securities

before recovery of their amortized cost bases, which may be maturity,

the Company has determined that no write-down is

In addition, the Company evaluates whether any portion of the decline in fair value of

securities is the result of

credit deterioration, which would require the recognition of an allowance for credit

Such evaluations consider the

extent to which the amortized cost of the security exceeds its fair value, changes in credit

ratings and any other known

adverse conditions related to the specific security.

The unrealized losses associated with securities at March 31, 2025 are

driven by changes in interest rates and are not due to the credit quality of the securities,

and accordingly, no allowance

credit losses is considered necessary related to securities at March 31, 2025.

These securities will continue to be monitored

as a part of the Company’s ongoing

evaluation of credit quality.

Management evaluates the financial performance of the

issuers on a quarterly basis to determine if it is probable that the issuers can make

all contractual principal and interest

Realized Gains and Losses

The Company had no realized gains or losses on sale of securities during the nine

months ended September 30, 2024 and

The Company had no realized gains or losses on sale of securities during the quarter

ended March 31, 2025 and 2024,

respectively.

1 unchanged sentence

FOR CREDIT LOSSES

September 30,

(Dollars in thousands)

10 unchanged sentences

Loans secured by real estate were approximately 87.8% of the Company’s

total loan portfolio at September 30, 2024.

September 30, 2024, the Company’s

geographic loan distribution was concentrated primarily in Lee County,

total loan portfolio at March 31, 2025.

31, 2025, the Company’s geographic

loan distribution was concentrated primarily in Lee County,

surrounding areas.

The loan portfolio segment is defined as the level at which an entity develops

and documents a systematic method for

The loan portfolio segment is defined as the level at which an entity develops and

documents a systematic method for

determining its allowance for credit losses.

38 unchanged sentences

– includes loans for hotels and motels.

Generally, the primary source

of repayment is dependent upon

Generally, the primary

source of repayment is dependent upon

income generated from the hotel/motel securing the loan.

7 unchanged sentences

repayment is dependent upon income generated from the real estate collateral.

underwriting of these loans

The underwriting of these loans

takes into consideration the occupancy and rental rates, as well as the financial

6 unchanged sentences

retail centers,

medical and professional offices, single retail stores, industrial

buildings, and warehouses leased to

medical and professional offices, single retail stores, industrial buildings,

and warehouses leased to

local and other businesses.

12 unchanged sentences

in accordance

with the Bank’s general loan policies and

procedures which require, among other things, proper documentation of

with the Bank’s general loan

policies and procedures which require, among other things, proper documentation

each borrower’s financial condition, satisfactory credit

14 unchanged sentences

the Bank’s general loan policies and

procedures which require, among other things, proper documentation

procedures which require, among other things, proper documentation of each

borrower’s financial condition, satisfactory credit history,

1 unchanged sentence

The following is a summary of current, accruing past due, and nonaccrual

loans by portfolio segment and class as of

September 30, 2024 and December 31, 2023.

loans by portfolio segment and class as of March

31, 2025 and December 31, 2024.

(Dollars in thousands)

September 30, 2024:

March 31, 2025:

Commercial and industrial

49 unchanged sentences

segments and classes by year of origination as

of September 30, 2024 and December 31, 2023.

The December 31, 2023 table has been revised to correct revolving loans

and properly allocate loans by year of origination.

Summary of Significant Accounting Policies – Correction

of March 31, 2025 and December 31, 2024.

Year of Origination

(Dollars in thousands)

September 30, 2024:

March 31, 2025:

Commercial and industrial

16 unchanged sentences

(Dollars in thousands)

September 30, 2024:

March 31, 2025:

Special mention

61 unchanged sentences

Allowance for Credit Losses

The Company adopted ASC 326 on January 1, 2023, which introduced

the CECL methodology for estimating all expected

losses over the life of a financial asset.

Under the CECL methodology,

the allowance for credit losses is measured on a

collective basis for pools of loans with similar risk characteristics, and for loans

that do not share similar risk characteristics

with the collectively evaluated pools, evaluations are performed

on an individual basis.

The composition of the provision for (reversal of) credit losses for the respective

periods is presented below.

Quarter ended September 30,

Nine months ended September 30,

The allowance for credit losses is measured on a collective basis for pools of

loans with similar risk characteristics, and for

loans that do not share similar risk characteristics with the collectively evaluated

pools, evaluations are performed on an

individual basis.

The composition of the provision for credit losses for the respective periods

is presented below.

Quarter ended March 31,

(Dollars in thousands)

1 unchanged sentence

Reserve for unfunded commitments

Total provision for (reversal

of) credit losses

Total provision for credit

The following table details the changes in the allowance for credit losses for loans,

2 unchanged sentences

Commercial and

Quarter ended:

September 30, 2024

Quarter ended March 31, 2025:

Beginning balance

Net (charge-offs) recoveries

Provision for (reversal of) credit losses

Ending balance

Nine months ended:

September 30, 2024

Beginning balance

Net recoveries (charge-offs)

Provision for (reversal of) credit losses

Ending balance

(Dollars in thousands)

Commercial and

Quarter ended:

September 30, 2023

Beginning balance

Net recoveries (charge-offs)

Provision for (reversal of) credit losses

Provision for credit losses

Ending balance

Nine months ended:

September 30, 2023

Quarter ended March 31, 2024:

Beginning balance

Impact of adopting ASC 326

Net recoveries (charge-offs)

Provision for (reversal of) credit losses

Provision for credit losses

Ending balance

1 unchanged sentence

which are individually evaluated to

determine expected credit losses as of September 30, 2024 and December

determine expected credit losses for the respective periods:

(Dollars in thousands)

September 30, 2024:

Commercial real estate

March 31, 2025:

Construction and land development

December 31, 2024:

Commercial real estate

Commercial and industrial

Construction and land development

The following table summarizes the Company’s

nonaccrual loans by major categories as of September 30, 2024 and

December 31, 2023.

Nonaccrual loans

nonaccrual loans by major categories for the respective periods.

(Dollars in thousands)

with no Allowance

With an Allowance

Nonaccrual Loans

September 30, 2024

Commercial real estate

March 31, 2025

Commercial and industrial

Construction and land development

Residential real estate

December 31, 2024

Commercial real estate

Residential real estate

Commercial and industrial

Construction and land development

MORTGAGE SERVICING

2 unchanged sentences

corresponding mortgage loans are sold.

An estimate of the fair value of the Company’s

MSRs is determined using

assumptions that market participants would use in estimating future net

servicing income, including estimates of

prepayment speeds, discount rates, default rates, costs to service, escrow account

earnings, contractual servicing fee

income, ancillary income, and late fees.

Subsequent to the date of transfer, the Company

has elected to measure its MSRs

under the amortization method.

Under the amortization method, MSRs are amortized in proportion to, and over

of, estimated net servicing income.

The Company generally sells, without recourse, conforming, fixed-rate, closed-end,

residential mortgages to Fannie Mae,

where the Company services the mortgages sold and records MSRs.

MSRs are included in other assets on the

accompanying consolidated balance sheets.

An estimate of the Company’s MSRs is determined

using assumptions that market

participants would use in estimating future net servicing income, including

estimates of prepayment speeds, discount rate,

default rates, cost to service, escrow account earnings, contractual servicing

fee income, ancillary income, and late fees.

The Company has elected to measure its MSRs under the amortization

Under the amortization method, MSRs are

amortized in proportion to, and over the period of, estimated net servicing

Increases in market interest rates

generally increase the fair value of MSRs by reducing prepayments and

refinancings and therefore reducing the prepayment

The Company has recorded MSRs related to loans sold to Fannie Mae.

The Company generally sells conforming, fixed-

rate, closed-end, residential mortgages to Fannie Mae.

MSRs are included in other assets on the accompanying

consolidated balance sheets.

The Company evaluates MSRs for impairment on a quarterly basis.

Impairment is determined by stratifying MSRs into

groupings based on predominant risk characteristics, such as interest rate and

groupings based on predominant risk characteristics, such as interest rate and loan

If, by individual stratum, the

2 unchanged sentences

as the fair value changes.

Changes in the valuation allowance are recognized in earnings as a component

Changes in the valuation allowance are recognized in earnings as a component of mortgage

lending income.

The following table details the changes in amortized MSRs and the related valuation

allowance for the respective periods.

Quarter ended September 30,

Nine months ended September 30,

The change in amortized MSRs and the related valuation allowance

for the quarters ended March 31, 2025 and 2024 are

presented below.

Quarter ended March 31,

(Dollars in thousands)

16 unchanged sentences

for an asset or liability at the measurement date.

GAAP establishes a fair value hierarchy for valuation inputs that gives the highest priority

to quoted prices in active

GAAP establishes a fair value hierarchy for valuation inputs that gives the

highest priority to quoted prices in active

markets for identical assets or liabilities and the lowest priority to unobservable inputs.

The fair value hierarchy is as

Level 1—inputs to the valuation methodology are quoted prices, unadjusted,

for identical assets or liabilities in active

Level 2—inputs to the valuation methodology include quoted prices for similar assets and

liabilities in active markets,

1—inputs to the valuation methodology are quoted prices, unadjusted, for identical assets or liabilities

Level 2—inputs to the valuation methodology include quoted prices for similar

assets and liabilities in active markets,

quoted prices for identical or similar assets or liabilities in markets that are not

14 unchanged sentences

that transfers in and out of any level are expected to be infrequent.

For the nine months ended September 30, 2024, there

were no transfers between levels and no changes in valuation techniques for

the Company’s financial assets and liabilities.

For the quarter ended March 31, 2025, there were no

transfers between levels and no changes in valuation techniques for the

Company’s financial assets and liabilities.

Assets and liabilities measured at fair value on a recurring

13 unchanged sentences

As part of its review, management may

obtain non-binding third party broker/dealer quotes to validate

obtain non-binding third-party broker/dealer quotes to validate the fair

value measurements.

7 unchanged sentences

The following table presents the balances of the assets and liabilities measured at fair

value on a recurring basis as of

September 30, 2024 and December 31, 2023, respectively,

by caption, on the accompanying consolidated balance sheets by

ASC 820 valuation hierarchy (as described above).

value on a recurring basis as of March

31, 2025 and December 31, 2024, respectively,

by caption, on the accompanying consolidated balance sheets by ASC 820

valuation hierarchy (as described above).

Quoted Prices in

2 unchanged sentences

(Dollars in thousands)

September 30, 2024:

March 31, 2025:

Securities available-for-sale:

57 unchanged sentences

value on a nonrecurring basis as of

September 30, 2024 and December 31, 2023, respectively,

by caption, on the accompanying consolidated balance sheets

and by FASB ASC 820

valuation hierarchy (as described above):

March 31, 2025 and December 31, 2024, respectively,

by caption, on the accompanying consolidated balance sheets and by

FASB ASC 820 valuation

hierarchy (as described above):

Quoted Prices in

2 unchanged sentences

(Dollars in thousands)

September 30, 2024:

March 31, 2025:

Loans held for sale

5 unchanged sentences

Quantitative Disclosures for Level 3 Fair Value

At September 30, 2024 and December 31, 2023, the Company had no Level

3 assets measured at fair value on a recurring

For Level 3 assets measured at fair value on a non-recurring basis at September

30, 2024 and December 31, 2023,

the significant unobservable inputs used in the fair value measurements

and the range of such inputs with respect to such

assets are presented below.

At March 31, 2025 and December 31, 2024, the Company had no Level 3 assets measured

at fair value on a recurring basis.

For Level 3 assets measured at fair value on a non-recurring basis at March 31,

2025 and December 31, 2024, the

significant unobservable inputs used in the fair value measurements and

the range of such inputs with respect to such assets

are presented below.

(Dollars in thousands)

1 unchanged sentence

Unobservable Input

September 30, 2024:

March 31, 2025:

Collateral dependent loans

49 unchanged sentences

and placement in the fair value hierarchy of the Company’s

instruments at September 30, 2024 and December 31, 2023 are presented

This table excludes financial instruments

for which the carrying amount approximates fair value.

instruments at March 31, 2025 and December 31, 2024 are presented below.

This table excludes financial instruments for

which the carrying amount approximates fair value.

Financial assets for which fair value approximates carrying value

13 unchanged sentences

(Dollars in thousands)

September 30, 2024:

March 31, 2025:

Financial Assets:

12 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements