Company: ISBA
Filing Date: 2025-11-10
Form Type: 10-Q
Source: 0000842517-25-000210
Chunk: 64

Company: ISABELLA BANK CORP
Filing Date: 2025-11-10
Form: 10-Q
Item: Part I, Item 1
Chunk 64
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$3,426 Real Estate25%25%December 31, 2024Valuation TechniqueFair ValueUnobservable InputActual RangeWeighted AverageCollateral Dependent LoansDiscount applied to collateral:Discounted value$254 Real Estate20% 20%Collateral discount rates may have ranges to accommodate differences in the age of the independent appraisal, broker price opinion, or internal evaluation.OMSR: OMSR (which are included in other assets) are subject to impairment testing. To test for impairment, we utilize a discounted cash flow analysis using interest rates and prepayment speed assumptions currently quoted for comparable instruments and discount rates. If the valuation model reflects a value less than the carrying value, OMSR are adjusted to fair value through a valuation allowance as determined by the model. As such, we classify OMSR subject to nonrecurring fair value adjustments as Level 3.The following table lists the quantitative information about OMSR fair value measurement as of:September 30, 2025Valuation TechniqueFair ValueUnobservable InputRateDiscounted cash flow$2,164 Constant prepayment rate7%Discount rate11%December 31, 2024Valuation TechniqueFair ValueUnobservable InputRateDiscounted cash flow$2,483 Constant prepayment rate7%Discount rate11%The preceding methods described may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Although we believe our valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement.Estimated Fair Values of Financial Instruments Not Recorded at Fair Value in their Entirety on a Recurring BasisDisclosure of the estimated fair values of financial instruments, which differ from carrying values, often requires the use of estimates. In cases where quoted market values in an active market are not available, we use present value techniques and other valuation methods to estimate the fair values of our financial instruments. These valuation methods require considerable judgment and the resulting estimates of fair value can be significantly affected by the assumptions made and methods used.

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The carrying amount and estimated fair value of financial instruments not recorded at fair value in their entirety on a recurring basis were as follows as of: September 30, 2025CarryingValueEstimatedFair ValueLevel 1Level 2Level 3ASSETSCash and cash equivalents$161,301 $161,301 $161,301