Note 3 - Investment Securities

12 Months Ended

Dec. 31, 2019

Notes to Financial Statements

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

NOTE

3.

INVESTMENT SECURITIES

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)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
December 31, 2019
State, county and 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
Total debt securities	$	346,874	$	2,716	$	(2,258)	$	347,332

(dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
December 31, 2018
State, county and municipal securities	$	4,008	$	18	$	(37)	$	3,989
Corporate debt securities		2,927		-		(55)		2,872
Mortgage-backed securities		356,498		303		(10,596)		346,205
Total debt securities	$	363,433	$	321	$	(10,688)	$	353,066

 The gross unrealized losses and estimated fair value of securities aggregated by category and length of time that securities have been in a continuous unrealized loss position are summarized as follows:

	Less Than 12 Months				12 Months or More				Total
(dollars in thousands)	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
December 31, 2019
State, county and 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)
Total debt securities	$	64,117	$	(331)	$	119,894	$	(1,927)	$	184,011	$	(2,258)
December 31, 2018
State, county and municipal securities		612		(3)		1,882		(34)		2,494		(37)
Corporate debt securities		2,009		(21)		863		(34)		2,872		(55)
Mortgage-backed securities		39,083		(504)		255,747		(10,092)		294,830		(10,596)
Total debt securities	$	41,704	$	(528)	$	258,492	$	(10,160)	$	300,196	$	(10,688)

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

December 31, 2019,

ninety-eight

securities have unrealized losses which have deprec

iated

1.2

pe

rcent from the Company’s amortized cost basis. 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. However, the Company owns

one

asset-backed security at

December 31, 2019

which was completely written off during prior years. This investment is comprised of

one

issuance of a trust preferred security and has

no

book value.

The amortized cost and fair value of investment securities as of

December 31, 2019,

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	$	150	$	150
Due after one year through five years		3,195		3,215
Due after five years through ten years		723		744
Due after ten years		3,876		3,812
	$	7,944	$	7,921
Mortgage-backed securities		338,930		339,411
	$	346,874	$	347,332

Proceeds from sales of investments available for sale were

$65.5

million in

2019

and

$11.3

million in

2018.

Gross realized gains totaled

$416,000

in

2019

and

$116,000

in

2018.

Gross realized losses totaled

$322,000

in

2019

and

$0

in

2018.

Investment securities having a carrying value totaling

$122.3

million and

$179.0

million as of

December 31, 2019

and

2018,

respectively, were pledged to secure public deposits and for other purposes.