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

U.S. government sponsored agencies	$	4,960	$	403	$	—	$	5,363
States and political subdivisions	110,401		4,642		(124)		114,919
Residential mortgage-backed securities	609,865		15,377		(2,024)		623,218
Commercial mortgage-backed securities	4,622		161		—		4,783
Bank-issued trust preferred securities	4,696		192		(158)		4,730
Total available-for-sale securities	$	734,544	$	20,775	$	(2,306)	$	753,013
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


	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
2020
Obligations of:


States and political subdivisions	$	17,651	$	124	5	$	—	$	—	—	$	17,651	$	124
Residential mortgage-backed securities	156,659		1,795		45	9,892		229		13	166,551		2,024

Bank-issued trust preferred securities	494		6		1	1,848		152		2	2,342		158
Total	$	174,804	$	1,925	51	$	11,740	$	381	15	$	186,544	$	2,306
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 systematically evaluates available-for-sale investment securities for an allowance of credit losses on a quarterly basis. At December 31, 2020, management concluded no individual securities at an unrealized loss position required an allowance for credit losses. At December 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 December 31, 2020 and 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 Consolidated Balance Sheets, with no recorded allowance for credit losses. Interest receivable on investment securities was $2.7 million at December 31, 2020 and $3.6 million at December 31, 2019

At December 31, 2020, approximately 99% of the fair value of mortgage-backed securities 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. Neither of the two positions had a fair value of less than 90% of their book value. Management analyzed the underlying credit quality of these mortgage-backed securities and concluded the unrealized losses were primarily attributable to the floating rate nature of these investments and the low 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 December 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 December 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:

U.S. government sponsored agencies	$	—		$	4,960		$	—		$	—		$	4,960
States and political subdivisions	6,317			26,728			34,663			42,693			110,401
Residential mortgage-backed securities	2			5,413			69,803			534,647			609,865
Commercial mortgage-backed securities	—			2,543			953			1,126			4,622
Bank-issued trust preferred securities	—			—			4,696			—			4,696
Total available-for-sale securities	$	6,319		$	39,644		$	110,115		$	578,466		$	734,544
Fair value
Obligations of:

U.S. government sponsored agencies	$	—		$	5,363		$	—		$	—		$	5,363
States and political subdivisions	6,375			27,905			36,996			43,643			114,919
Residential mortgage-backed securities	2			5,498			70,376			547,342			623,218
Commercial mortgage-backed securities	—			2,601			991			1,191			4,783
Bank-issued trust preferred securities	—			—			4,730			—			4,730
Total available-for-sale securities	$	6,377		$	41,367		$	113,093		$	592,176		$	753,013
Total weighted-average yield	2.45		%	2.67		%	2.23		%	2.13		%	2.18		%


(Dollars in thousands)	Amortized Cost		Allowance for Credit Losses (a)		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
2020
Obligations of:
States and political subdivisions	$	35,199	$	(60)	$	510	$	(165)	$	35,484
Residential mortgage-backed securities	25,890		—		852		—		26,742
Commercial mortgage-backed securities	5,429		—		427		—		5,856
Total held-to-maturity securities	$	66,518	$	(60)	$	1,789	$	(165)	$	68,082
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

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 are obligations of state and political subdivisions. Peoples analyzed these securities using cumulative default rate averages for investment grade municipal securities. As a result, at December 31, 2020, Peoples recorded $60,000 of allowance for credit losses for held-to-maturity securities, compared to $7,000 at January 1, 2020.


	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
2020
Obligations of:
States and political subdivisions	$	18,662	$	165	5	$	—	$	—	—	$	18,662	$	165


Total	$	18,662	$	165	5	$	—	$	—	—	$	18,662	$	165
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

The table below presents the amortized cost, fair value and total weighted-average yield of held-to-maturity securities by contractual maturity at December 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	$	—		$	988		$	2,511		$	31,700		$	35,199
Residential mortgage-backed securities	—			—			2,715			23,175			25,890
Commercial mortgage-backed securities	—			374			3,737			1,318			5,429
Total held-to-maturity securities	$	—		$	1,362		$	8,963		$	56,193		$	66,518
Fair value
Obligations of:
States and political subdivisions	$	—		$	1,163		$	2,832		$	31,489		$	35,484
Residential mortgage-backed securities	—			—			2,820			23,922			26,742
Commercial mortgage-backed securities	—			382			4,128			1,346			5,856
Total held-to-maturity securities	$	—		$	1,545		$	9,780		$	56,757		$	68,082
Total weighted-average yield	—		%	0.63		%	2.97		%	1.04		%	1.29		%


(Dollars in thousands)	2020		2019
FHLB stock	$	21,718	$	27,235
FRB stock	13,311		13,310
Nonqualified deferred compensation	1,867		1,499
Equity investment securities	299		321
Other investment securities	365		365
Total other investment securities	$	37,560	$	42,730

During 2020, Peoples redeemed $10.5 million of FHLB stock in order to be in compliance with the requirements of the FHLB. Peoples purchased $5.0 million of additional FHLB stock during 2020, as a result of the FHLB's capital requirements on FHLB advances during the year. During 2019, Peoples redeemed $4.9 million of FHLB stock in order to be in compliance with the requirements of the FHLB, and acquired $2.8 million of FHLB stock through the First Prestonsburg acquisition.

As of January 1, 2018, Peoples adopted ASU 2016-01, which requires changes in the fair value of equity investment securities to be recognized in net income. Prior to 2018, changes in the fair value of equity investment securities were recognized through AOCI. During the year ended December 31, 2020, Peoples recorded the change in the fair value of equity investment securities held at December 31, 2020 in other non-interest income, resulting in an unrealized loss of $19,000. Net realized gains on sales of equity investment securities included in other non-interest income during 2020 consisted of a realized gain of $680,000 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. During the year ended December 31, 2019, Peoples recorded the change in the fair value of equity investment securities held at December 31, 2019 in other non-interest income, resulting in unrealized gain of $44,000. Additionally, the adoption of ASU 2016-01 resulted in the reclassification of equity investment securities from available-for-sale investment securities to other investment securities. Consequently, as of January 1, 2018, net realized gains on the sale of equity investment securities are included in other non-interest income on the Consolidated Statements of Income. Net realized gains on sales of equity investment securities, included in other non-interest income during 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. During 2018, there was a $413,000 realized loss on the sale of equity investment securities, included in other non-interest income.

At December 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)	2020		2019
Securing public and trust department deposits, and Repurchase Agreements:
Available-for-sale	$	547,734	$	527,655
Held-to-maturity	16,971		12,975
Securing additional borrowing capacity at the FHLB and the FRB:
Available-for-sale	1,685		44,618
Held-to-maturity	11,316		14,155