Note 3 - Debt and Equity Securities

12 Months Ended

Dec. 31, 2020

Notes to Financial Statements

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

(3) Debt and Equity Securities 

Debt and equity securities have been classified in the consolidated balance sheet according to management’s intent. Debt and equity securities at  December 31, 2020 consist of the following:

	Securities Available-For-Sale
	In Thousands
			Gross Unrealized		Gross Unrealized		Estimated Market
	Amortized Cost		Gains		Losses		Value
Government-sponsored enterprises (GSEs)	$	125,712		328		135		125,905
Mortgage-backed securities		258,774		5,636		620		263,790
Asset-backed securities		36,394		582		19		36,957
Corporate bonds		2,500		100		—		2,600
Obligations of states and political subdivisions		147,462		4,229		400		151,291
	$	570,842		10,875		1,174		580,543

The Company’s classification of securities at  December 31, 2019 was as follows:

	Securities Available-For-Sale
	In Thousands
			Gross Unrealized		Gross Unrealized		Estimated Market
	Amortized Cost		Gains		Losses		Value
Government-sponsored enterprises (GSEs)	$	59,735		48		204		59,579
Mortgage-backed securities		265,648		2,300		635		267,313
Asset-backed securities		27,531		1		303		27,229
Corporate bonds		—		—		—		—
Obligations of states and political subdivisions		67,293		559		828		67,024
	$	420,207		2,908		1,970		421,145

Included in mortgage-backed securities are collateralized mortgage obligations totaling $88,472,000 (fair value of $89,116,000) and $46,994,000 (fair value of $47,442,000) at  December 31, 2020 and 2019, respectively.

The amortized cost and estimated market value of debt securities at December 31, 2020, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities of mortgage and asset-backed securities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

	In Thousands
Securities Available-For-Sale	Amortized Cost		Estimated Market Value
Due in one year or less	$	1,196		1,198
Due after one year through five years		26,325		26,542
Due after five years through ten years		107,341		108,184
Due after ten years		140,812		143,872
		275,674		279,796
Mortgage and asset-backed securities		295,168		300,747
	$	570,842		580,543

Results from sales of debt and equity securities are as follows:

	In Thousands
	2020			2019			2018
Gross proceeds	$	54,870			37,325			39,857
Gross realized gains	$	901			75			102
Gross realized losses		(19	)		(343	)		(752	)
Net realized gains (losses)	$	882			(268	)		(650	)

Securities carried on the balance sheet of approximately $282,028,000 (approximate market value of $288,013,000) and $256,300,000 (approximate market value of $256,598,000) were pledged to secure public deposits and for other purposes as required or permitted by law at  December 31, 2020 and 2019, respectively.

Included in the securities above are $78,931,000 (approximate market value of $80,713,000) at December 31, 2020 in obligations of political subdivisions located within the states of Tennessee, Alabama, and Texas.

Securities that have rates that adjust prior to maturity totaled $48,215,000 (approximate market value of $48,439,000) and $48,018,000 (approximate market value of $47,784,000) at  December 31, 2020 and 2019, respectively.

Temporarily Impaired Securities

The following table shows the gross unrealized losses and fair value of the Company’s available-for-sale securities with unrealized losses that are not deemed to be other-than-temporarily impaired, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at  December 31, 2020 and 2019.

	In Thousands, Except Number of Securities
	Less than 12 Months						12 Months or More						Total
					Number of						Number of
			Unrealized		Securities				Unrealized		Securities				Unrealized
2020	Fair Value		Losses		Included		Fair Value		Losses		Included		Fair Value		Losses
Available-for-Sale Securities:
Debt securities:
GSEs	$	47,991	$	135		18	$	—	$	—		—	$	47,991	$	135
Mortgage-backed securities		78,381		573		29		6,776		47		12		85,157		620
Asset-backed securities		4,950		19		3		—		—		—		4,950		19
Corporate bonds		—		—		—		—		—		—		—		—
Obligations of states and political subdivisions		44,061		394		33		689		6		1		44,750		400
	$	175,383	$	1,121		83	$	7,465	$	53		13	$	182,848	$	1,174

	In Thousands, Except Number of Securities
	Less than 12 Months						12 Months or More						Total
					Number of						Number of
			Unrealized		Securities				Unrealized		Securities				Unrealized
2019	Fair Value		Losses		Included		Fair Value		Losses		Included		Fair Value		Losses
Available-for-Sale Securities:
Debt securities:
GSEs	$	16,507	$	114		5	$	24,658	$	90		9	$	41,165	$	204
Mortgage-backed securities		45,862		182		21		56,917		453		52		102,779		635
Asset-backed securities		17,807		161		10		7,317		142		4		25,124		303
Corporate bonds		—		—		—		—		—		—		—		—
Obligations of states and political subdivisions		30,423		783		26		3,858		45		10		34,281		828
	$	110,599	$	1,240		62	$	92,750	$	730		75	$	203,349	$	1,970

As of December 31, 2020, management does not have the intent to sell any of the securities classified as available-for-sale in the table above and believes that it is more likely than not the Company will not have to sell any such securities before a recovery of cost. Any unrealized losses are largely due to increases in market interest rates over the yields available at the time the underlying securities were purchased. The fair value is expected to recover as the bonds approach their maturity date or repricing date or if market yields for such investments decline. Management does not believe any of the securities are impaired due to reasons of credit quality. Accordingly, as of December 31, 2020, management believes the impairments detailed in the table above are temporary and no impairment loss has been realized in our consolidated statement of earnings.