Securities

The amortized cost and estimated fair value of investments in securities at December 31, 2018 and 2017 were as follows (dollars in thousands):



	December 31, 2018
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Securities available for sale:
Federal agencies and GSEs	$	137,070	$	442	$	3,473	$	134,039
Mortgage-backed and CMOs	113,883		385		2,401		111,867
State and municipal	80,022		411		531		79,902
Corporate	6,799		68		22		6,845
Total securities available for sale	$	337,774	$	1,306	$	6,427	$	332,653

The Company adopted ASU 2016-01 effective January 1, 2018 and had equity securities with a fair value of $1,830,000 at December 31, 2018 and recognized in income $42,000 of unrealized holding gains during 2018. During the year ended December 31, 2018, the Company sold $431,000 in equity securities at fair value.



	December 31, 2017
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Securities available for sale:
Federal agencies and GSEs	$	114,246	$	8	$	2,127	$	112,127
Mortgage-backed and CMOs	106,163		293		1,140		105,316
State and municipal	92,711		1,262		347		93,626
Corporate	7,842		234		14		8,062
Equity securities	1,383		823		—		2,206
Total securities available for sale	$	322,345	$	2,620	$	3,628	$	321,337

The amortized cost and estimated fair value of investments in debt securities at December 31, 2018, by contractual maturity, are shown in the following table. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Because mortgage-backed securities have both known principal repayment terms as well as unknown principal repayments due to potential borrower pre-payments, it is difficult to accurately predict the final maturity of these investments. Mortgage-backed securities are shown separately (dollars in thousands):



	Available for Sale
	Amortized Cost		Fair Value
Due in one year or less	$	6,872	$	6,868
Due after one year through five years	115,573		114,672
Due after five years through ten years	75,996		74,952
Due after ten years	25,450		24,294
Mortgage-backed and CMOs	113,883		111,867
	$	337,774	$	332,653

Gross realized gains and losses on and the proceeds from the sale of securities available for sale were as follows (dollars in thousands):



	For the Years Ended December 31,
	2018			2017			2016
Gross realized gains	$	342		$	825		$	844
Gross realized losses	(261		)	(13		)	(8		)
Proceeds from sales of securities	57,607			55,903			13,019

Securities with a carrying value of approximately $143,064,000 and $166,284,000 at December 31, 2018 and 2017, respectively, were pledged to secure public deposits, repurchase agreements, and for other purposes as required by law. FHLB letters of credit were used as additional collateral in the amounts of $190,250,000 at December 31, 2018 and $190,700,000 at December 31, 2017.

Temporarily Impaired Securities

The following table shows estimated fair value and gross unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at December 31, 2018. The reference point for determining when securities are in an unrealized loss position is month-end. Therefore, it is possible that a security's market value exceeded its amortized cost on other days during the past twelve-month period.

Available for sale securities that have been in a continuous unrealized loss position are as follows (dollars in thousands):



	Total				Less than 12 Months				12 Months or More
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Federal agencies and GSEs	$	103,797	$	3,473	$	14,982	$	8	$	88,815	$	3,465
Mortgage-backed and CMOs	86,852		2,401		5,473		15		81,379		2,386
State and municipal	39,755		531		7,199		18		32,556		513
Corporate	484		22		—		—		484		22
Total	$	230,888	$	6,427	$	27,654	$	41	$	203,234	$	6,386

Federal agencies and GSEs: The unrealized losses on the Company's investment in 23 government sponsored entities ("GSEs") were caused by interest rate increases. The contractual terms of those investments do not permit the issuer to settle the securities at a price less than the amortized cost bases of the investments. Because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at December 31, 2018.

Mortgage-backed securities: The unrealized losses on the Company's investment in 70 GSE mortgage-backed securities were caused by interest rate increases. Sixty of these securities were in an unrealized loss position for 12 months or more. The contractual cash flows of those investments are guaranteed by an agency of the U.S. Government. Accordingly, it is expected that the securities would not be settled at a price less than the amortized cost bases of the Company's investments. Because the decline in fair value is attributable to changes in interest rates and not credit quality, and because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at December 31, 2018.

Collateralized Mortgage Obligations: The unrealized loss associated with two private GSE collateralized mortgage obligations ("CMOs") is due to normal market fluctuations. One of these securities has been in an unrealized loss position for 12 months or more. The contractual cash flows of those investments are guaranteed by an agency of the U.S. Government. Accordingly, it is expected that the securities would not be settled at a price less than the amortized cost bases of the Company's investments. Because the decline in fair value is attributable to changes in interest rates and not credit quality, and because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at December 31, 2018.

State and municipal securities: The unrealized losses on 62 state and municipal securities were caused by interest rate increases and not credit deterioration. The contractual terms of those investments do not permit the issuer to settle the securities at a price less than the amortized cost bases of the investments. Because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at December 31, 2018.

Corporate securities: The unrealized loss on one corporate security was caused by interest rate increases and not credit deterioration. The contractual terms of the investment does not permit the issuer to settle the security at a price less than the amortized cost basis of the investment. Because the Company does not intend to sell the investment and it is not more likely than not that the Company will be required to sell the investment before recovery of its amortized cost basis, which may be maturity, the Company does not consider the investment to be other-than-temporarily impaired at December 31, 2018.

Due to restrictions placed upon the Bank's common stock investment in the Federal Reserve Bank of Richmond and FHLB, these securities have been classified as restricted equity securities and carried at cost. These restricted securities are not subject to the investment security classifications and are included as a separate line item on the Company's consolidated balance sheet. The FHLB requires the Bank to maintain stock in an amount equal to 4.25% of outstanding borrowings and a specific percentage of the Bank's total assets. The Federal Reserve Bank of Richmond requires the Bank to maintain stock with a par value equal to 3.0% of its outstanding capital and an additional 3.0% is on call. Restricted equity securities consist of Federal Reserve Bank of Richmond stock in the amount of $3,621,000 and $3,587,000 as of December 31, 2018 and 2017, respectively, and FHLB stock in the amount of $1,626,000 and $2,523,000 as of December 31, 2018 and 2017, respectively.

The table below shows gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities had been in a continuous unrealized loss position, at December 31, 2017 (dollars in thousands):



	Total				Less than 12 Months				12 Months or More
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Federal agencies and GSEs	$	99,133	$	2,127	$	45,474	$	321	$	53,659	$	1,806
Mortgage-backed and CMOs	90,806		1,140		64,449		533		26,357		607
State and municipal	34,550		347		27,442		159		7,108		188
Corporate	1,529		14		495		5		1,034		9
Total	$	226,018	$	3,628	$	137,860	$	1,018	$	88,158	$	2,610

Other-Than-Temporary-Impaired Securities

As of December 31, 2018 and 2017, there were no securities classified as other-than-temporary impaired.