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SECURITIES
 12 Months Ended
Dec. 31, 2017
SECURITIES  
SECURITIES

NOTE 3: SECURITIES

The amortized cost and fair values of investments in securities at December 31, 2017 and 2016, are summarized in the following tables:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross

 

Gross

 

 

 

 

 

Amortized

 

Unrealized

 

Unrealized

 

 

(Dollars in thousands)

    

Cost

    

Gains

    

Losses

    

Fair Value

December 31, 2017

 

 

  

 

 

  

 

 

  

 

 

  

Securities available for sale:

 

 

  

 

 

  

 

 

  

 

 

  

State and municipal securities

 

$

60,861

 

$

1,173

 

$

(118)

 

$

61,916

U.S. Agency Securities:

 

 

  

 

 

  

 

 

  

 

 

  

Debt securities

 

 

17,315

 

 

 —

 

 

(370)

 

 

16,945

Collateralized mortgage obligations

 

 

61,878

 

 

50

 

 

(675)

 

 

61,253

Mortgage-backed securities

 

 

82,510

 

 

330

 

 

(866)

 

 

81,974

Other securities

 

 

1,104

 

 

 —

 

 

(17)

 

 

1,087

Total

 

$

223,668

 

$

1,553

 

$

(2,046)

 

$

223,175

Securities held to maturity:

 

 

  

 

 

  

 

 

  

 

 

  

Mortgage-backed securities

 

$

33

 

$

 2

 

$

 —

 

$

35

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2016

 

 

  

 

 

  

 

 

  

 

 

  

Securities available for sale:

 

 

  

 

 

  

 

 

  

 

 

  

State and municipal securities

 

$

58,991

 

$

638

 

$

(650)

 

$

58,979

U.S. Agency Securities:

 

 

  

 

 

  

 

 

  

 

 

  

Debt securities

 

 

20,795

 

 

 —

 

 

(454)

 

 

20,341

Collateralized mortgage obligations

 

 

34,005

 

 

90

 

 

(325)

 

 

33,770

Mortgage-backed securities

 

 

92,489

 

 

516

 

 

(1,215)

 

 

91,790

Other securities

 

 

1,081

 

 

 —

 

 

(17)

 

 

1,064

Total

 

$

207,361

 

$

1,244

 

$

(2,661)

 

$

205,944

Securities held to maturity:

 

 

  

 

 

  

 

 

  

 

 

  

Mortgage-backed securities

 

$

34

 

$

 3

 

$

 —

 

$

37

The amortized cost and estimated fair value of securities at December 31, 2017 and 2016, by contractual maturities, are shown below. Expected maturities may differ from contractual maturities if borrowers have the right to call or prepay obligations.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Securities Available for Sale

 

Securities Held to Maturity

 

 

Amortized

 

Fair

 

Amortized

 

Fair

(Dollars in thousands)

    

Cost

    

Value

    

Cost

    

Value

December 31, 2017

 

 

  

 

 

  

 

 

  

 

 

  

Amounts maturing in:

 

 

  

 

 

  

 

 

  

 

 

  

1 year or less

 

$

6,203

 

$

6,194

 

$

 —

 

$

 —

1 year through 5 years

 

 

26,811

 

 

26,635

 

 

 —

 

 

 —

5 years through 10 years

 

 

9,215

 

 

9,348

 

 

 —

 

 

 —

After 10 years

 

 

181,439

 

 

180,998

 

 

33

 

 

35

 

 

$

223,668

 

$

223,175

 

$

33

 

$

35

December 31, 2016

 

 

  

 

 

  

 

 

  

 

 

  

Amounts maturing in:

 

 

  

 

 

  

 

 

  

 

 

  

1 year or less

 

$

5,579

 

$

5,570

 

$

 —

 

$

 —

1 year through 5 years

 

 

28,946

 

 

28,937

 

 

 —

 

 

 —

5 years through 10 years

 

 

20,834

 

 

20,880

 

 

 —

 

 

 —

After 10 years

 

 

152,002

 

 

150,557

 

 

34

 

 

37

 

 

$

207,361

 

$

205,944

 

$

34

 

$

37

Securities with a carrying amount of approximately $6.1 million and $302,000 were sold during the years ended December 31, 2017 and 2016, respectively. Net gains of $27,000 and $28,000 were recognized, which is reflected in other noninterest income in the Company’s consolidated statements of income for the years ended December 31, 2017 and 2016, respectively. There were no security sales during the year ended December 31, 2015.

At December 31, 2017 and December 31, 2016, securities with a carrying amount of approximately $58.7 million and $54.0 million respectively, were pledged to secure public deposits and for other purposes required or permitted by law.

The Company held 106 and 121 securities at December 31, 2017 and December 31, 2016, respectively, that were in a gross unrealized loss position as illustrated in the table below. Management does not have the intent to sell any of the securities classified as available for sale in an unrealized loss position and believes that it is more likely than not that the Company will not have to sell any of these securities before a recovery of cost. The unrealized losses are attributable primarily to changes in market interest rates relative to those available when the securities were acquired. The fair value of these securities is expected to recover as the securities reach their maturity or re‑pricing date, or if changes in market rates for such investments decline. Management does not believe that any of the securities are impaired due to reasons of credit quality. Accordingly, as of December 31, 2017 and 2016, management believes the impairments detailed in the table below are temporary and no impairment loss has been recorded in the Company’s consolidated statements of income for the years ended December 31, 2017, 2016 and 2015.

Information pertaining to individual securities with unrealized losses at December 31, 2017 and 2016, aggregated by investment category and the length of time were as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Less Than Twelve Months

 

Twelve Months or More

 

 

 

 

Gross

 

 

 

Gross

 

 

Fair

 

Unrealized

 

Fair

 

Unrealized

 

    

Value

    

Losses

    

Value

    

Losses

December 31, 2017

 

 

  

 

 

  

 

 

  

 

 

  

Securities available for sale:

 

 

  

 

 

  

 

 

  

 

 

  

State and municipal securities

 

$

2,494

 

$

(3)

 

$

6,516

 

$

(115)

U.S. Agency Securities:

 

 

  

 

 

  

 

 

  

 

 

  

Debt securities

 

 

4,464

 

 

(55)

 

 

12,481

 

 

(315)

Collateralized mortgage obligations

 

 

44,116

 

 

(380)

 

 

9,938

 

 

(295)

Mortgage-backed securities

 

 

22,079

 

 

(123)

 

 

32,538

 

 

(743)

Other securities

 

 

 —

 

 

 —

 

 

1,087

 

 

(17)

 

 

$

73,153

 

$

(561)

 

$

62,560

 

$

(1,485)

December 31, 2016

 

 

  

 

 

  

 

 

  

 

 

  

Securities available for sale:

 

 

  

 

 

  

 

 

  

 

 

  

State and municipal securities

 

$

22,856

 

$

(647)

 

$

313

 

$

(3)

U.S. Agency Securities:

 

 

  

 

 

  

 

 

  

 

 

  

Debt securities

 

 

18,341

 

 

(454)

 

 

 —

 

 

 —

Collateralized mortgage obligations

 

 

24,800

 

 

(325)

 

 

 —

 

 

 —

Mortgage-backed securities

 

 

67,500

 

 

(1,215)

 

 

 —

 

 

 —

Other securities

 

 

1,064

 

 

(17)

 

 

 —

 

 

 —

 

 

$

134,561

 

$

(2,658)

 

$

313

 

$

(3)