Company: FCAP
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001171843-25-001868
Chunk: 113

Company: FIRST CAPITAL INC
Filing Date: 2025-03-31
Form: 10-K
Item: Item 1
Chunk 113
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 a provision for (or recovery of) credit loss expense. Losses are charged against the ACL when management believes that uncollectibility of an available for sale debt security is confirmed or when either of the criteria regarding intent or requirement to sell is met.

Accrued interest receivable on available for sale debt securities is reported in accrued interest receivable on the consolidated balance sheet and is excluded from the estimate of credit losses. Accrued interest receivable on available for sale debt securities totaled $2.1 million and $2.4 million at December 31, 2024 and 2023, respectively.

F-10

FIRST CAPITAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

(1 - continued)

Held to Maturity Debt Securities:  Debt securities for which the Company has the positive intent and ability to hold to maturity are reported at cost, adjusted for amortization of premiums and accretion of discounts that are recognized in interest income using methods approximating the interest method over the period to maturity, adjusted for anticipated prepayments.  The held to maturity securities portfolio includes subordinated debt obligations issued by other bank holding companies.

Management measures expected credit losses on held to maturity debt securities on a collective basis by major security type. Accrued interest receivable on held to maturity debt securities is reported in accrued interest receivable on the consolidated balance sheet and is excluded from the estimate of credit losses. Accrued interest receivable on held to maturity debt securities totaled $18,000 at both December 31, 2024 and 2023.      

The Company estimates expected credit losses for held to maturity debt securities and considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts.

Equity Securities

Equity securities, other than restricted securities such as FHLB stock, are carried at fair value, with changes in fair value included in earnings. Equity securities without readily determinable fair values are carried at cost, minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or similar investment of the same issuer. Restrictions on the sale of equity securities held are not considered in the fair value measurement unless the restriction is a characteristic of the actual securities.  Dividends received from equity securities, other than restricted securities such as FHLB stock, are included in other noninterest income.

FHLB Stock

The Bank is a member of the FHLB system.  Members are required to