XML 28 R10.htm IDEA: XBRL DOCUMENT v3.20.4
INVESTMENT SECURITIES
12 Months Ended
Dec. 31, 2020
INVESTMENT SECURITIES  
INVESTMENT SECURITIES

NOTE 3 - INVESTMENT SECURITIES

The following presents the amortized cost and fair value of securities available-for-sale, with gross unrealized gains and losses recognized in accumulated other comprehensive income as of December 31, 2020 and December 31, 2019 (in thousands):

    

    

Gross

Gross

Amortized

Unrealized

Unrealized

Fair

December 31, 2020

Cost

Gains

Losses

Value

Investment securities available-for-sale:

 

  

 

  

 

  

 

  

U.S. Treasury debt

$

250

$

4

$

$

254

Corporate bonds

6,000

55

(11)

6,044

Government National Mortgage Association ("GNMA") mortgage-backed securities – residential

 

23,806

 

798

 

 

24,604

Federal National Mortgage Association ("FNMA") mortgage-backed securities – residential

1,616

61

1,677

Corporate collateralized mortgage obligations ("CMO") and mortgage-backed securities ("MBS")

 

4,078

 

62

 

(53)

 

4,087

Total securities available-for-sale

$

35,750

$

980

$

(64)

$

36,666

    

    

Gross

Gross

Amortized

Unrealized

Unrealized

Fair

December 31, 2019

Cost

Gains

Losses

Value

Investment securities available-for-sale:

 

  

 

  

 

  

 

  

U.S. Treasury debt

$

250

$

4

$

$

254

GNMA mortgage-backed securities – residential

 

45,490

 

157

 

(335)

 

45,312

FNMA mortgage-backed securities – residential

2,935

 

11

 

(29)

2,917

CMO and MBS

 

10,425

 

40

 

(45)

 

10,420

Total securities available-for-sale

$

59,100

$

212

$

(409)

$

58,903

Net amortization of premiums and discounts related to mortgage securities during each of the years ended December 31, 2020 and 2019 was $0.4 million and $0.2 million, respectively, and is included in net interest income.

As of December 31, 2020, the amortized cost and estimated fair value of available-for-sale securities have contractual maturity dates shown in the table below (in thousands). Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately.

    

Amortized

    

Fair

December 31, 2020

Cost

Value

Due within one year

$

250

$

254

Due between one year and five years

1,250

1,245

Due between five years and ten years

4,750

4,799

Securities (agency, CMO, and MBS)

 

29,500

 

30,368

Total

$

35,750

$

36,666

In 2014, the Company began investing in a small business investment company ("SBIC") fund administered by the Small Business Administration. During the years ended 2020 and 2019, the Company invested $0.5 million and $0.4 million, respectively, in SBIC. As of December 31, 2020 and 2019, the Company held a balance of $2.1 million and $1.6 million, respectively, with SBIC, which is included in Other assets in the accompanying Consolidated Balance Sheets. The Company may be obligated to invest up to an additional $0.9 million in future SBIC investments.

As of December 31, 2020 and December 31, 2019, securities with carrying values totaling $3.7 million and $5.5 million, respectively, were pledged to secure various public deposits and credit facilities of the Company.

As of December 31, 2020 and December 31, 2019, there were no holdings of securities of any one issuer, other than the U.S. Government sponsored entities and agencies, in an amount greater than 10% of shareholders’ equity.

As of December 31, 2020 and December 31, 2019, seven securities and twenty-six securities were in an unrealized loss position, with unrealized losses totaling $0.1 million and $0.4 million, respectively. Two of the securities in an unrealized loss position as of December 31, 2020 have been in a continuous unrealized loss position for more than twelve months, and the remaining have been in a continuous unrealized loss position for less than twelve months. The unrealized loss positions were caused primarily by interest rate changes and market assumptions about prepayments of principal and interest on the underlying mortgages. Because the decline in market value is attributable to market conditions, not credit quality, and because the Company has the ability and intent to hold these investments until a recovery of fair value, which may be near or at maturity, the Company does not consider these investments to be other-than-temporarily impaired as of December 31, 2020.

The following table summarizes securities with unrealized losses as of December 31, 2020 and December 31, 2019, aggregated by major security type and length of time in a continuous unrealized loss position (in thousands, before tax):

    

Less than 12 Months

    

12 Months or Longer

    

Total

Fair

Unrealized

Fair

Unrealized

Fair

Unrealized

December 31, 2020

Value

Losses

Value

Losses

Value

    

Losses

Corporate bonds

3,489

(11)

3,489

 

(11)

Corporate CMO and MBS

 

880

 

(40)

 

566

 

(13)

 

1,446

 

(53)

Total

$

4,369

$

(51)

$

566

$

(13)

$

4,935

$

(64)

    

Less than 12 Months

    

12 Months or Longer

    

Total

Fair

Unrealized

Fair

Unrealized

Fair

Unrealized

December 31, 2019

    

Value

Losses

Value

Losses

    

Value

    

Losses

GNMA mortgage-backed securities - residential

$

28,203

$

(193)

$

4,450

$

(142)

$

32,653

$

(335)

FNMA mortgage-backed securities - residential

2,347

(29)

2,347

(29)

Corporate CMO and MBS

 

7,780

 

(45)

 

 

 

7,780

 

(45)

Total

$

35,983

$

(238)

$

6,797

$

(171)

$

42,780

$

(409)

The Company did not sell any securities during the year ended December 31, 2020. The Company sold $7.5 million of securities, realized $0.1 million of gains, and realized no losses, from the sale of securities using the specific identification method for the year ended December 31, 2019.