Investment Securities

9 Months Ended

Sep. 30, 2020

Investments, Debt and Equity Securities [Abstract]

The amortized cost and estimated fair value of securities available for sale along with gross unrealized gains and losses are summarized as follows:


(dollars in thousands)
September 30, 2020	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Securities Available for Sale:
U.S. treasury securities	$	245	$	—	$	—	$	245
State, county & municipal securities	38,494		571		(159)		38,906
Corporate debt securities	3,750		3		—		3,753
Mortgage-backed securities	312,764		8,418		(485)		320,697
	$	355,253	$	8,992	$	(644)	$	363,601

December 31, 2019
Securities Available for Sale:
State, county & municipal securities	$	5,133	$	36	$	(54)	$	5,115
Corporate debt securities	2,811		11		(16)		2,806
Mortgage-backed securities	338,930		2,669		(2,188)		339,411
	$	346,874	$	2,716	$	(2,258)	$	347,332

The amortized cost and fair value of investment securities as of September 30, 2020, by contractual maturity, are shown hereafter. Expected maturities may differ from contractual maturities for certain investments because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. This is often the case with mortgage-backed securities, which are disclosed separately in the table below.


	Securities Available for Sale
(dollars in thousands)	Amortized Cost		Fair Value
Due in one year or less	$	892	$	895
Due after one year through five years	3,939		3,989
Due after five years through ten years	7,336		7,505
Due after ten years	30,322		30,515
	$	42,489	$	42,904

Mortgage-backed securities	312,764		320,697
	$	355,253	$	363,601

Proceeds from the sale of investment securities totaled $44.5 million and $99.1 million for the nine months ended September 30, 2020 and 2019, respectively. The sale of investment securities for the nine months ended September 30, 2020 and 2019 resulted in gross realized gains of $1.2 million and $314,000 and losses of $204,000 and $215,000, respectively.

The sale of investment securities for the three months ended September 30, 2020 and 2019 resulted in gross realized gains of $858,000 and $196,000 and losses of $142,000 and $162,000, respectively.

Proceeds from the sale of investment securities held to maturity totaled $1.8 million for the first nine months of 2019, and was sold at par.

Investment securities having a carrying value approximating $102.4 million and $122.3 million were pledged to secure public deposits and for other purposes as of September 30, 2020 and December 31, 2019, respectively.

Information pertaining to securities with gross unrealized losses at September 30, 2020 and December 31, 2019 aggregated by investment category and length of time that individual securities have been in a continuous loss position, follows:


	Less Than 12 Months				12 Months or Greater				Total
(dollars in thousands)	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
September 30, 2020
State, county & municipal securities	$	14,173	$	(159)	$	—	$	—	$	14,173	$	(159)

Mortgage-backed securities	36,344		(177)		4,185		(308)		40,529		(485)
	$	50,517	$	(336)	$	4,185	$	(308)	$	54,702	$	(644)

December 31, 2019
State, county & municipal securities	$	3,257	$	(54)	$	—	$	—	$	3,257	$	(54)
Corporate debt securities	—		—		784		(16)		784		(16)
Mortgage-backed securities	60,860		(277)		119,110		(1,911)		179,970		(2,188)
	$	64,117	$	(331)	$	119,894	$	(1,927)	$	184,011	$	(2,258)

Management evaluates securities for other-than-temporary impairment at least on a quarterly basis, and more frequently when economic or market concerns warrant such evaluation. Consideration is given to (1) the length of time and the extent to which the fair value has been less than cost, (2) the financial condition and near-term prospects of the issuer and (3) the intent and ability of the Company to retain its investment in the issuer for a period of time sufficient to allow for any anticipated recovery in fair value.

At September 30, 2020, 28 securities have unrealized losses. These securities are guaranteed by either the U.S. Government, other governments or U.S. corporations. In analyzing an issuer’s financial condition, management considers whether the securities are issued by the federal government or its agencies, whether downgrades by bond rating agencies have occurred and the results of reviews of the issuer’s financial condition. The unrealized losses are largely due to increases in market interest rates over the yields available at the time the underlying securities were purchased. As management has the ability to hold debt securities until maturity, or for the foreseeable future if classified as available-for-sale, no declines are deemed to be other than temporary.