Investments

Investments available-for-sale are summarized as follows at the dates indicated:



	March 31, 2019
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(In thousands)
Mortgage-backed investments:
Fannie Mae	$	23,967	$	89	$	(370	)	$	23,686
Freddie Mac	6,310		27		(18		)	6,319
Ginnie Mae	23,053		10		(1,050		)	22,013
Other	8,925		47		(19		)	8,953
Municipal bonds	7,619		169		(21		)	7,767
U.S. Government agencies	47,355		72		(820		)	46,607
Corporate bonds	23,491		323		(501		)	23,313
Total	$	140,720	$	737	$	(2,799	)	$	138,658



	December 31, 2018
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(In thousands)
Mortgage-backed investments:
Fannie Mae	$	24,276	$	24	$	(657	)	$	23,643
Freddie Mac	6,351		10		(74		)	6,287
Ginnie Mae	23,311		—		(1,250		)	22,061
Other	8,983		17		(21		)	8,979
Municipal bonds	10,615		49		(120		)	10,544
U.S. Government agencies	48,190		73		(825		)	47,438
Corporate bonds	23,490		399		(671		)	23,218
Total	$	145,216	$	572	$	(3,618	)	$	142,170

The tables below summarize the aggregate fair value and gross unrealized loss by length of time those investment securities have been continuously in an unrealized loss position at the dates indicated:



	March 31, 2019
	Less Than 12 Months					12 Months or Longer					Total
	Fair Value		Gross Unrealized Loss			Fair Value		Gross Unrealized Loss			Fair Value		Gross Unrealized Loss
	(In thousands)
Mortgage-backed investments:
Fannie Mae	$	—	$	—		$	15,338	$	(370	)	$	15,338	$	(370	)
Freddie Mac	—		—			3,203		(18		)	3,203		(18		)
Ginnie Mae	—		—			19,135		(1,050		)	19,135		(1,050		)
Other	6,008		(19		)	—		—			6,008		(19		)
Municipal bonds	—		—			987		(21		)	987		(21		)
U.S. Government agencies	9,661		(114		)	30,381		(706		)	40,042		(820		)
Corporate bonds	—		—			6,999		(501		)	6,999		(501		)
Total	$	15,669	$	(133	)	$	76,043	$	(2,666	)	$	91,712	$	(2,799	)



	December 31, 2018
	Less Than 12 Months					12 Months or Longer					Total
	Fair Value		Gross Unrealized Loss			Fair Value		Gross Unrealized Loss			Fair Value		Gross Unrealized Loss
	(In thousands)
Mortgage-backed investments:
Fannie Mae	$	5,480	$	(32	)	$	16,721	$	(625	)	$	22,201	$	(657	)
Freddie Mac	1,994		(23		)	3,185		(51		)	5,179		(74		)
Ginnie Mae	2,867		(8		)	19,194		(1,242		)	22,061		(1,250		)
Other	6,008		(21		)	—		—			6,008		(21		)
Municipal bonds	4,161		(46		)	934		(74		)	5,095		(120		)
U.S. Government agencies	5,985		(13		)	30,779		(812		)	36,764		(825		)
Corporate bonds	—		—			6,828		(671		)	6,828		(671		)
Total	$	26,495	$	(143	)	$	77,641	$	(3,475	)	$	104,136	$	(3,618	)

On a quarterly basis, management makes an assessment to determine whether there have been any events or economic circumstances to indicate that a security on which there is an unrealized loss is impaired on an other-than-temporary basis. The Company considers many factors including the severity and duration of the impairment, recent events specific to the issuer or industry, and for debt securities, external credit ratings and recent downgrades. Securities on which there is an unrealized loss that is deemed to be an other-than-temporary impairment (“OTTI”) are written down to fair value. If the Company intends to sell a debt security, or it is likely that the Company will be required to sell the debt security before recovering its cost basis, the entire impairment loss would be recognized in earnings as an OTTI. If the Company does not intend to sell the debt security and it is not likely that it will be required to sell the debt security but does not expect to recover the entire amortized cost basis of the debt security, only the portion of the impairment loss representing credit losses would be recognized in earnings. The credit loss on a debt security is measured as the difference between the amortized cost basis and the present value of the cash flows expected to be collected. Projected cash flows are discounted by the original or current effective interest rate depending on the nature of the debt security being measured for potential OTTI. The remaining impairment related to all other factors, the difference between the present value of the cash flows expected to be collected and fair value, is recognized as a charge to other comprehensive income (“OCI”). Impairment losses related to all other factors are presented as separate categories within OCI. At March 31, 2019, and December 31, 2018, the Company had 37 securities and 51 securities in an unrealized loss position, respectively, with 31 of these securities in an unrealized loss position for 12 months or more at both dates. Management does not believe that any individual unrealized loss as of March 31, 2019, or December 31, 2018, represented OTTI. The decline in fair market value of these securities was generally due to changes in interest rates and changes in market-desired spreads subsequent to their purchase. Management also reviewed the financial condition of the entities issuing municipal or corporate bonds at March 31, 2019, and December 31, 2018, and determined that an OTTI charge was not warranted.

The amortized cost and estimated fair value of investments available-for-sale at March 31, 2019, by contractual maturity, are shown below. 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. Investments not due at a single maturity date, primarily mortgage-backed investments, are shown separately.



	March 31, 2019
	Amortized Cost		Fair Value
	(In thousands)
Due within one year	$	251	$	250
Due after one year through five years	7,328		7,481
Due after five years through ten years	19,291		19,000
Due after ten years	51,595		50,956
	78,465		77,687
Mortgage-backed investments	62,255		60,971
Total	$	140,720	$	138,658

Under Washington state law, in order to participate in the public funds program the Company is required to pledge eligible securities as collateral in an amount equal to 50% of the public deposits held less the FDIC insured amount. Investment securities with market values of $15.7 million and $15.6 million were pledged as collateral for public deposits at March 31, 2019, and December 31, 2018, respectively, both of which exceeded the collateral requirements established by the Washington Public Deposit Protection Commission.

For the three months ended March 31, 2019, we had calls and sales on investment securities of $3.0 million, generating a net loss of $8,000. For the three months ended March 31, 2018, we had a maturity on one investment security of $2.0 million generating no gain or loss.