Company: EMYB
Filing Date: 2025-05-14
Form Type: 10-Q
Source: 0001449794-25-000009
Chunk: 4

Company: Embassy Bancorp, Inc.
Filing Date: 2025-05-14
Form: 10-Q
Item: Part I, Item 8
Chunk 4
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 the issuer, and the Company’s intent and ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in fair value. Management believes that the unrealized loss only represents temporary impairment of the securities, which are predominantly backed by credit of government agencies, and are a result of the increased market interest rates since the time of purchase, and not the credit quality of the issuer. As such, no allowance for credit losses was required on securities available for sale in an unrealized loss position at March 31, 2025 and December 31, 2024. Note 4 – Restricted Investment in Bank Stock Restricted investments in bank stock consist of FHLBank of Pittsburgh (“FHLB”) stock and Atlantic Community Bankers Bank (“ACBB”) stock. The restricted stocks are carried at cost. Federal law requires a member institution of the FHLB to hold stock of its district FHLB according to a predetermined formula. The Bank had FHLB stock at a carrying value of $998 thousand and $1.6 million as of March 31, 2025 and December 31, 2024, respectively. The Bank had ACBB stock at a carrying value of $40 thousand at March 31, 2025 and December 31, 2024.‎ 

10  Embassy Bancorp, Inc.                                                                                                                            Notes to Consolidated Financial Statements (Unaudited) 

 Management evaluates the FHLB and ACBB restricted stock for impairment. Management’s determination of whether these investments are impaired is based on their assessment of the ultimate recoverability of their cost rather than by recognizing temporary declines in value. The determination of whether a decline affects the ultimate recoverability of their cost is influenced by criteria such as (1) the significance of the decline in net assets of the issuer as compared to the capital stock amount for the issuer and the length of time this situation has persisted, (2) commitments by the issuer to make payments required by law or regulation and the level of such payments in relation to the operating performance of the issuer, and (3) the impact of legislative and regulatory changes on institutions and, accordingly, on the customer base of the issuer. Based upon its evaluation of the foregoing criteria, management believes no impairment charge is necessary related to the FHLB or ACBB stock as of March 31, 2025. Note 5 – Loans and Credit Quality The following table presents the composition of loans receivable at March 31, 2025 and December 31, 2024