Company: MCHB
Filing Date: 2025-07-15
Form Type: S-4/A
Source: 0001140361-25-025920
Chunk: 399

Company: Mechanics Bancorp
Filing Date: 2025-07-15
Form: S-4/A
Chunk 399
---
39,401 |     | —                |
| Total debt securities available-for-sale         |     |        $3,065,251 |     | $—                            |     |        $3,065,251 |     | $—               |
| Equity securities                                |     |           $15,355 |     | $—                            |     |           $15,355 |     | $—               |
| Derivative assets                                |     |           $12,835 |     | $—                            |     |           $12,835 |     | $—               |
| Derivative liabilities                           |     |           $11,056 |     | $—                            |     |           $11,056 |     | $—               |

As of March 31, 2025 and December 31, 2024, there were no assets measured at fair value on a recurring basis using significant observable inputs (Level 3). Assets and Liabilities Measured on a Non-Recurring Basis Collateral Dependent Loan and Lease Receivables: The fair value of collateral dependent loan and lease receivables with specific allocations of the allowance for credit losses based on collateral values is generally based on recent real estate appraisals. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are typically significant and result in a Level 3 classification of the inputs for determining fair value. Collateral dependent loans with specific allowance allocations of the allowance for credit losses, which are measured for dependency using the fair value of the collateral for collateral dependent loans. Other real estate owned: Non-recurring adjustments to certain commercial and residential real estate properties classified as other real estate owned are measured at the lower of the carrying amount or fair value, less costs to sell. Fair values are generally based on third party appraisals of the property or internal evaluations based on comparable sales, resulting in a Level 3 classification. Appraisals for both collateral-dependent impaired loans and real estate owned are performed by certified general appraisers (for commercial properties) or certified residential appraisers (for residential properties) whose qualifications and licenses have been reviewed and verified by the Bank. Once

F-73

TABLE OF CONTENTS

received, a member of the Appraisal Department reviews the assumptions and approaches utilized in the appraisal as well as the overall resulting fair value in comparison