Note 3 - Securities

12 Months Ended

Dec. 31, 2019

Notes to Financial Statements

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

NOTE

3

:     SECURITIES

The amortized cost and approximate fair values, together with gross unrealized gains and losses, of securities classified as available-for-sale are as follows:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Approximate Fair Value
As of December 31, 2019
Debt Securities:
U. S. government agencies	$	2,499,755	$	-	$	(11,962	)		2,487,793
Municipals		35,625,038		675,382		(125,693	)		36,174,727
Corporates		15,395,190		154,942		(14,945	)		15,535,187
Mortgage-backed securities - private label		13,788,728		52,035		(29,392	)		13,811,371
Government sponsored mortgage-backed securities and SBA loan pools		49,844,049		585,641		(193,454	)		50,236,236
	$	117,152,760	$	1,468,000	$	(375,446	)	$	118,245,314

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Approximate Fair Value
As of December 31, 2018
Debt Securities:
Municipals	$	34,470,648	$	10,581	$	(710,709	)	$	33,770,520
Corporates		3,000,000		18,927		-			3,018,927
Government sponsored mortgage-backed securities and SBA loan pools		50,632,011		81,999		(1,237,260	)		49,476,750
	$	88,102,659	$	111,507	$	(1,947,969	)	$	86,266,197

Maturities of available-for-sale debt securities as of

December 31, 2019:

	Amortized Cost		Approximate Fair Value
1-5 years	$	385,947	$	391,254
5-10 years		18,704,471		18,877,281
After ten years		34,429,565		34,929,172
Mortgage-backed securities - private label not due on a single maturity date		13,788,728		13,811,371
Government sponsored mortgage-backed securities and SBA loan pools not due on a single maturity date		49,844,049		50,236,236
	$	117,152,760	$	118,245,314

The carrying value of securities pledged as collateral, to secure public deposits and for other purposes, amounted to

$5,358,929

and

$24,374,187

as of

December 31, 2019

and

2018,

respectively.

Gross gains of

$244,777,

$48,931

and

$165,237

and gross losses of

$155,213,

$57,022

and

$118,908

resulting from sale of available-for-sale securities were realized for the years ended

December 31, 2019,

2018

and

2017,

respectively. The tax effect of these net gains (losses) was

$18,809,

(

$2,063

) and

$17,142

in

2019,

2018

and

2017,

respectively.

The Company evaluates all securities quarterly to determine if any unrealized losses are deemed to be other than temporary. Certain investment securities are valued less than their historical cost. These declines are primarily the result of the rate for these investments yielding less than current market rates or declines in stock prices of equity securities. Based on evaluation of available evidence, management believes the declines in fair value for these securities are temporary. It is management’s intent to hold the debt securities to maturity or until recovery of the unrealized loss. Should the impairment of any of these debt securities become other than temporary, the cost basis of the investment will be reduced and the resulting loss recognized in net income in the period the other-than-temporary impairment is identified, to the extent the loss is related to credit issues, and to other comprehensive income to the extent the decline on debt securities is related to other factors and the Company does

not

intend to sell the security prior to recovery of the unrealized loss.

          

No

securities were written down for other-than-temporary impairment during the years ended

December 31, 2019,

2018

and

2017.

          Certain other investments in debt and equity securities are reported in the consolidated financial statements at an amount less than their historical cost. Total fair value of these investments at

December 31, 2019

and

2018,

was

$42,570,363

and

$70,434,596,

respectively, which is approximately

36%

and

82%

of the Company’s investment portfolio. These declines primarily resulted from changes in market interest rates.

The following table shows gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at

December 31, 2019

and

2018.

	December 31, 2019
	Less than 12 Months					12 Months or More					Total
Description of Securities	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
U.S. government agencies	$	2,487,795	$	(11,962	)	$	-	$	-		$	2,487,795	$	(11,962	)
Municipals		7,083,208		(125,693	)		-		-			7,083,208		(125,693	)
Corporates		2,452,005		(14,945	)		-		-			2,452,005		(14,945	)
Mortgage-backed securities - private label		9,416,669		(29,392	)		-		-			9,416,669		(29,392	)
Government sponsored mortgage-backed securities and SBA loan pools		18,112,148		(125,906	)		3,018,538		(67,548	)		21,130,686		(193,454	)
	$	39,551,825	$	(307,898	)	$	3,018,538	$	(67,548	)	$	42,570,363	$	(375,446	)

	December 31, 2018
	Less than 12 Months					12 Months or More					Total
Description of Securities	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Municipals	$	6,324,750	$	(67,774	)	$	23,223,221	$	(642,935	)	$	29,547,971	$	(710,709	)
Government sponsored mortgage-backed securities and SBA loan pools		7,127,597		(112,282	)		33,759,028		(1,124,978	)		40,886,625		(1,237,260	)
	$	13,452,347	$	(180,056	)	$	56,982,249	$	(1,767,913	)	$	70,434,596	$	(1,947,969	)