Securities

The amortized cost and estimated fair value of investments in securities at December 31, 2019 and 2018 were as follows (dollars in thousands):



	December 31, 2019
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Securities available for sale:
U.S. Treasury	$	14,992	$	—	$	5	$	14,987
Federal agencies and GSEs	126,829		1,504		219		128,114
Mortgage-backed and CMOs	182,732		1,901		393		184,240
State and municipal	41,427		769		42		42,154
Corporate	9,514		186		—		9,700
Total securities available for sale	$	375,494	$	4,360	$	659	$	379,195

The Company adopted ASU 2016-01 effective January 1, 2018 and had no equity securities at December 31, 2019 and recognized in income $333,000 of unrealized holding gains during 2019. During the year ended December 31, 2019, the Company sold $445,000 in equity securities at fair value.



	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 amortized cost and estimated fair value of investments in debt securities at December 31, 2019, 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	$	41,234	$	41,207
Due after one year through five years	51,039		51,814
Due after five years through ten years	56,537		57,763
Due after ten years	43,952		44,171
Mortgage-backed and CMOs	182,732		184,240
	$	375,494	$	379,195

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,
	2019			2018			2017
Gross realized gains	$	328		$	342		$	825
Gross realized losses	(54		)	(261		)	(13		)
Proceeds from sales of securities	29,878			57,607			55,903

Securities with a carrying value of approximately $179,852,000 and $143,064,000 at December 31, 2019 and 2018, 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 $170,000,000 at December 31, 2019 and $190,250,000 at December 31, 2018.

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, 2019. 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
U.S. Treasury	$	14,987	$	5	$	14,987	$	5	$	—	$	—
Federal agencies and GSEs	69,095		219		31,779		44		37,316		175
Mortgage-backed and CMOs	89,391		393		66,324		266		23,067		127
State and municipal	4,262		42		3,108		37		1,154		5
Total	$	177,735	$	659	$	116,198	$	352	$	61,537	$	307

U.S. Treasury: The unrealized loss associated with one U.S. Treasury bill is due to normal market fluctuations. The contractual cash flows of this investment are guaranteed by the U.S. Government. Accordingly, it is expected that this security would not be settled at a price less than the amortized cost basis of the Company's investment. 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 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 this investment to be other-than-temporarily impaired at December 31, 2019.

Federal agencies and GSEs: The unrealized losses on the Company's investment in 26 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, 2019.

Mortgage-backed securities: The unrealized losses on the Company's investment in 32 GSE mortgage-backed securities were caused by interest rate increases. Fifteen 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, 2019.

Collateralized Mortgage Obligations: The unrealized loss associated with one private GSE collateralized mortgage obligation ("CMO") is due to normal market fluctuations. This one security has been in an unrealized loss position for 12 months or more. The contractual cash flows of this investment are guaranteed by an agency of the U.S. Government. Accordingly, it is expected that this security would not be settled at a price less than the amortized cost basis of the Company's investment. 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 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 this investment to be other-than-temporarily impaired at December 31, 2019.

State and municipal securities: The unrealized losses on six 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, 2019.

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 $6,415,000 and $3,621,000 as of December 31, 2019 and 2018, respectively, and FHLB stock in the amount of $2,215,000 and $1,626,000 as of December 31, 2019 and 2018, 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, 2018 (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

Other-Than-Temporary-Impaired Securities

As of December 31, 2019 and 2018, there were no securities classified as other-than-temporary impaired.