Investment in Securities

9 Months Ended

Sep. 30, 2019

Investments, Debt and Equity Securities [Abstract]

Investment in Securities

Note 11 – Investment in Securities

Investment securities available-for-sale are recorded at fair value on a recurring basis. The Company’s investment securities available-for-sale are measured at fair value using Level 2 valuations. The market evaluation utilizes several sources which include “observable inputs” rather than “significant unobservable inputs” and therefore fall into the Level 2 category. The amortized cost, gross unrealized gains, gross unrealized losses and fair value of investment securities are summarized as follows:

	September 30, 2019
(In thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
State and political subdivisions	$	312,826	$	13,680	$	—	$	326,506
U.S. government agencies		99,813		516		244		100,085
Certificates of deposit		1,000		—		—		1,000
Total	$	413,639	$	14,196	$	244	$	427,591

	December 31, 2018
(In thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
State and political subdivisions	$	332,732	$	3,791	$	1,806	$	334,717
U.S. government agencies		106,153		86		1,417		104,822
Certificates of deposit		1,995		—		—		1,995
Total	$	440,880	$	3,877	$	3,223	$	441,534

The fair values of securities with unrealized losses are as follows:

	September 30, 2019
	Less than 12 months				12 months or more				Total
(In thousands)	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
State and political subdivisions	$	1,117	$	1	$	—	$	—	$	1,117	$	1
U.S. government agencies		5,967		18		25,809		225		31,776		243
Total	$	7,084	$	19	$	25,809	$	225	$	32,893	$	244

	December 31, 2018
	Less than 12 months				12 months or more				Total
(In thousands)	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
State and political subdivisions	$	91,248	$	556	$	60,546	$	1,250	$	151,794	$	1,806
U.S. government agencies		30,409		130		38,005		1,287		68,414		1,417
Total	$	121,657	$	686	$	98,551	$	2,537	$	220,208	$	3,223

-16-

There were 15 securities, or 5% of the total (10 greater than 12 months), in an unrealized loss position as of September 30, 2019. There were 136 securities, or 43% of the total (61 greater than 12 months), in an unrealized loss position as of December 31, 2018. All unrealized losses were reviewed to determine whether the losses were other than temporary. Management believes that all unrealized losses are temporary since they were market driven, and it is more likely than not that the Company will not be required to sell prior to recovery of the amortized basis.

The amortized cost and fair value of investment securities by contractual maturity are shown in the following table. Expected maturities may differ from contractual maturities because borrowers have the right to prepay obligations with or without prepayment penalties.

	September 30, 2019
(In thousands)	Amortized Cost		Fair Value
Due in 1 year or less	$	35,337	$	35,489
Due after 1 year through 5 years		106,384		108,511
Due after 5 years through 10 years		230,729		242,078
Due after 10 years		41,189		41,513
Total	$	413,639	$	427,591

Proceeds from sales of investment securities classified as available-for-sale were $0 for each of the three month periods ended September 30, 2019 and 2018, and were $4,648,000 and $58,520,000 for the nine months ended September 30, 2019 and 2018, respectively. There were no gross realized gains for the three months ended September 30, 2019 or 2018. Gross realized gains were $19,000 for the nine months ended September 30, 2019 compared to gross realized losses of $42,000 for the nine months ended September 30, 2018. There were no securities pledged to secure public deposits and for other purposes at September 30, 2019.