
(Dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
March 31, 2020
Obligations of:

U.S. government sponsored agencies	$	5,918	$	443	$	—	$	6,361
States and political subdivisions	105,904		3,026		(118)		108,812
Residential mortgage-backed securities	798,762		25,914		(783)		823,893
Commercial mortgage-backed securities	16,899		279		(117)		17,061
Bank-issued trust preferred securities	4,696		202		(190)		4,708

Total available-for-sale securities	$	932,179	$	29,864	$	(1,208)	$	960,835
December 31, 2019
Obligations of:

U.S. government sponsored agencies	$	7,917	$	292	$	—	$	8,209
States and political subdivisions	111,217		3,018		(131)		114,104
Residential mortgage-backed securities	787,430		7,763		(4,184)		791,009
Commercial mortgage-backed securities	18,135		88		(135)		18,088
Bank-issued trust preferred securities	4,696		137		(142)		4,691

Total available-for-sale securities	$	929,395	$	11,298	$	(4,592)	$	936,101

The unrealized losses related to residential mortgage-backed securities at March 31, 2020 and December 31, 2019, were attributed to changes in market interest rates and spreads since the securities were purchased.

During each of the three months ended March 31, 2020 and 2019, Peoples realized no gross losses from sales of available-for-sale securities. The gross gains realized by Peoples from sales of available-for-sale securities for the periods ended March 31 were as follows:


	Less than 12 Months									12 Months or More					Total
(Dollars in thousands)	Fair Value		Unrealized Loss		No. of Securities	Fair Value		Unrealized Loss		No. of Securities	Fair Value		Unrealized Loss
March 31, 2020
Obligations of:


States and political subdivisions	$	2,337	$	75	2	$	2,251	$	43	1	$	4,588	$	118
Residential mortgage-backed securities	57,391		449		28	18,948		334		15	76,339		783
Commercial mortgage-backed securities	—		—		—	2,050		117		3	2,050		117
Bank-issued trust preferred securities	—		—		—	1,810		190		2	1,810		190

Total	$	59,728	$	524	30	$	25,059	$	684	21	$	84,787	$	1,208
December 31, 2019
Obligations of:


States and political subdivisions	$	6,226	$	74	2	$	2,441	$	57	1	$	8,667	$	131
Residential mortgage-backed securities	284,096		2,527		62	88,993		1,657		39	373,089		4,184
Commercial mortgage-backed securities	970		21		1	2,409		114		3	3,379		135
Bank-issued trust preferred securities	—		—		—	1,858		142		2	1,858		142

Total	$	291,292	$	2,622	65	$	95,701	$	1,970	45	$	386,993	$	4,592

Management evaluates available-for-sale investment securities for an allowance for credit losses on a quarterly basis. At March 31, 2020, management concluded that no individual securities at an unrealized loss position required an allowance for credit losses. At March 31, 2020, Peoples did not have the intent to sell, nor was it more likely than not that Peoples would be required to sell, any of the securities with an unrealized loss prior to recovery. Further, the unrealized losses at both March 31, 2020 and March 31, 2019 were largely attributable to changes in market interest rates and spreads since the securities were purchased, and were not credit related losses. Accrued interest receivable is not included in investment securities balances, and is presented in the “Other assets” line of the Unaudited Consolidated Balance Sheets, with no recorded allowance for credit losses. Interest receivable on investment securities was $3.8 million at March 31, 2020 and $3.6 million at December 31, 2019.

At March 31, 2020, approximately 99% of the mortgage-backed securities with a market value that had been at an unrealized loss position for twelve months or more were issued by U.S. government sponsored agencies. The remaining 1%, or two positions, consisted of privately issued mortgage-backed securities with all of the underlying mortgages originated prior to 2004. Both of these positions had a fair value of less than 90% of their book value, with an aggregate book and fair value of $202,000 and $165,000, respectively. Management analyzed the underlying credit quality of these securities and concluded the unrealized losses were primarily attributable to the floating rate nature of these investments and the low remaining number of loans underlying these securities.

The unrealized losses with respect to the two bank-issued trust preferred securities that had been in an unrealized loss position for twelve months or more at March 31, 2020 were primarily attributable to the subordinated nature of the debt.

The table below presents the amortized cost, fair value and total weighted-average yield of available-for-sale securities by contractual maturity at March 31, 2020. The weighted-average yields are based on the amortized cost. In some cases, the issuers may have the right to call or prepay obligations without call or prepayment penalties prior to the contractual maturity date.


(Dollars in thousands)	Within 1 Year			1 to 5 Years			5 to 10 Years			Over 10 Years			Total
Amortized cost
Obligations of:

U.S. government sponsored agencies	$	—		$	1,993		$	3,925		$	—		$	5,918
States and political subdivisions	4,641			23,918			42,744			34,601			105,904
Residential mortgage-backed securities	4			1,656			81,803			715,299			798,762
Commercial mortgage-backed securities	4,750			8,024			974			3,151			16,899
Bank-issued trust preferred securities	—			—			4,696			—			4,696

Total available-for-sale securities	$	9,395		$	35,591		$	134,142		$	753,051		$	932,179
Fair value
Obligations of:

U.S. government sponsored agencies	$	—		$	2,115		$	4,246		$	—		$	6,361
States and political subdivisions	4,655			24,299			44,538			35,320			108,812
Residential mortgage-backed securities	4			1,710			83,776			738,403			823,893
Commercial mortgage-backed securities	4,781			8,162			1,025			3,093			17,061
Bank-issued trust preferred securities	—			—			4,708			—			4,708

Total available-for-sale securities	$	9,440		$	36,286		$	138,293		$	776,816		$	960,835
Total weighted-average yield	2.25		%	2.63		%	2.68		%	2.58		%	2.59		%


(Dollars in thousands)	Amortized Cost		Allowance for Credit Losses		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
March 31, 2020
Obligations of:
States and political subdivisions	$	3,844	$	(6)	$	504	$	—	$	4,342
Residential mortgage-backed securities	29,070		—		1,020		—		30,090
Commercial mortgage-backed securities	5,830		—		420		—		6,250
Total held-to-maturity securities	$	38,744	$	(6)	$	1,944	$	—	$	40,682
December 31, 2019
Obligations of:
States and political subdivisions	$	4,346	$	—	$	445	$	—	$	4,791
Residential mortgage-backed securities	21,494		—		169		(94)		21,569
Commercial mortgage-backed securities	5,907		—		275		(1)		6,181
Total held-to-maturity securities	$	31,747	$	—	$	889	$	(95)	$	32,541

At March 31, 2020, there were no held-to-maturity investment securities that had an unrealized loss. The following table presents a summary of held-to-maturity investment securities that had an unrealized loss at December 31, 2019:


	Less than 12 Months									12 Months or More					Total
(Dollars in thousands)	Fair Value		Unrealized Loss		No. of Securities	Fair Value		Unrealized Loss		No. of Securities	Fair Value		Unrealized Loss





December 31, 2019

Residential mortgage-backed securities	$	7,731	$	67	1	$	890	$	27	1	$	8,621	$	94
Commercial mortgage-backed securities	1,666		1		1	—		—		—	1,666		1
Total	$	9,397	$	68	2	$	890	$	27	1	$	10,287	$	95

Management evaluates held-to-maturity investment securities for an allowance for credit losses on a quarterly basis. The majority of Peoples' held-to-maturity investment securities are issued by U.S. government sponsored agencies. The remaining securities were obligations of state and political subdivisions. Peoples analyzed these securities using cumulative default rate averages for investment grade municipal securities and determined that the potential credit losses of the securities was $6,000. As a result, at March 31, 2020, Peoples recorded $6,000 of allowance for credit losses for held-to-maturity securities, compared to $7,000 at January 1, 2020.

The table below presents the amortized cost, fair value and total weighted-average yield of held-to-maturity securities by contractual maturity at March 31, 2020. The weighted-average yields are based on the amortized cost and are computed on a fully taxable-equivalent basis using a statutory federal corporate income tax rate of 21%. In some cases, the issuers may have the right to call or prepay obligations without call or prepayment penalties prior to the contractual maturity date.


(Dollars in thousands)	Within 1 Year			1 to 5 Years			5 to 10 Years			Over 10 Years			Total
Amortized cost
Obligations of:
States and political subdivisions	$	300		$	—		$	3,544		$	—		$	3,844
Residential mortgage-backed securities	—			—			3,399			25,671			29,070
Commercial mortgage-backed securities	—			392			3,816			1,622			5,830
Total held-to-maturity securities	$	300		$	392		$	10,759		$	27,293		$	38,744
Fair value
Obligations of:
States and political subdivisions	$	301		$	—		$	4,041		$	—		$	4,342
Residential mortgage-backed securities	—			—			3,538			26,552			30,090
Commercial mortgage-backed securities	—			402			4,214			1,634			6,250
Total held-to-maturity securities	$	301		$	402		$	11,793		$	28,186		$	40,682
Total weighted-average yield	2.55		%	2.29		%	2.79		%	2.71		%	2.73		%


(Dollars in thousands)	March 31, 2020		December 31, 2019
FHLB stock	$	31,595	$	27,235
FRB stock	13,310		13,310
Nonqualified deferred compensation	1,365		1,499
Equity investment securities	289		321
Other investment securities	365		365
Total other investment securities	$	46,924	$	42,730

Peoples redeemed FHLB stock in order to be in compliance with the requirements of the FHLB of Cincinnati, which redemptions totaled $700,000 during the first quarter 2020. Peoples purchased additional FHLB Stock, which totaled $5.0 million during the first quarter 2020, as a result of the FHLB of Cincinnati's capital requirements on FHLB advances during the quarter.

During the three months ended March 31, 2020 and March 31, 2019, Peoples recorded the change in the fair value of equity investment securities held at March 31, 2020 and March 31, 2019, respectively, in other non-interest income, resulting in unrealized loss of $30,000 and unrealized gain of $22,000, respectively. Net realized gains on sales of equity investment securities, included in other non-interest income during the first three months of 2019, consisted of a realized gain of $787,000 related to the sale of restricted Class B Visa stock, which had been held at a carrying cost and fair value of zero due to the litigation liability associated with the stock.

At March 31, 2020, Peoples' investment in equity investment securities was comprised largely of common stocks issued by various unrelated bank holding companies. There were no equity investment securities of a single issuer that exceeded 10% of Peoples' stockholders' equity.

Peoples had pledged available-for-sale investment securities and held-to-maturity investment securities to secure public and trust department deposits, and repurchase agreements in accordance with federal and state requirements. Peoples also pledged available-for-sale investment securities and held-to-maturity securities to secure additional borrowing capacity at the FHLB and the FRB.


	Carrying Amount
(Dollars in thousands)	March 31, 2020		December 31, 2019

Securing public and trust department deposits, and repurchase agreements:
Available-for-sale	$	572,848	$	527,655
Held-to-maturity	19,263		12,975
Securing additional borrowing capacity at the FHLB and the FRB:
Available-for-sale	92,651		44,618
Held-to-maturity	13,587		14,155