NOTE 4 –SECURITIES

Amortized cost and fair value of securities available for sale and the related gross unrealized gains and losses recognized in accumulated other comprehensive income (loss) were as follows:

2017	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Available for sale
Mortgage-backed securities
U. S. sponsored agency MBS - residential	$	198,631	$	175	$	(2,216	)	$	196,590
U. S. sponsored agency CMO's - residential		51,548		241		(681	)		51,108
Total mortgage-backed securities of government sponsored agencies		250,179		416		(2,897	)		247,698
U. S. government sponsored agency securities		19,312		1		(179	)		19,134
Obligations of states and political subdivisions		11,599		61		(26	)		11,634
Total available for sale	$	281,090	$	478	$	(3,102	)	$	278,466

2016	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Available for sale
Mortgage-backed securities
U. S. sponsored agency MBS - residential	$	177,105	$	245	$	(3,173	)	$	174,177
U. S. sponsored agency CMO's - residential		73,163		761		(657	)		73,267
Total mortgage-backed securities of government sponsored agencies		250,268		1,006		(3,830	)		247,444
U. S. government sponsored agency securities		24,652		23		(174	)		24,501
Obligations of states and political subdivisions		16,645		111		(94	)		16,662
Total available for sale	$	291,565	$	1,140	$	(4,098	)	$	288,607

In 2017 and 2015, there were no sales of securities, while in 2016, a gain of $4 was recognized upon the sale (including calls) of securities. The tax expense related to the gain in 2016 was $1.

The realized gain, net of tax, was reclassified out of accumulated other comprehensive income (loss) on the statement of comprehensive income. The realized gain is reported on the income statement under the caption "Gain on disposition of securities" and the reclassified provision for income taxes is reported on the income statement under the caption "Provision for income taxes".

Securities with an approximate carrying value of $208,301 and $207,832 at December 31, 2017 and 2016 were pledged to secure public deposits, trust funds, securities sold under agreements to repurchase and for other purposes as required or permitted by law.

The amortized cost and fair value of securities at December 31, 2017 by contractual maturity are shown below. 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. Securities not due at a single maturity date, such as mortgage-backed securities, are shown separately.

	Amortized Cost		Fair Value
Available for sale
Due in one year or less	$	10,405	$	10,390
Due after one year through five years		14,823		14,718
Due after five years through ten years		5,131		5,113
Due after ten years		552		547
Mortgage-backed securities of government sponsored agencies		250,179		247,698
Total available for sale	$	281,090	$	278,466

Securities with unrealized losses at year-end 2017 aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position are as follows:

	Less than 12 Months					12 Months or More					Total
Description of Securities	Fair Value		Unrealized Loss			Fair Value		Unrealized Loss			Fair Value		Unrealized Loss

U.S government sponsored agency securities	$	6,780	$	(41	)	$	10,335	$	(138	)	$	17,115	$	(179	)
U.S government sponsored agency MBS – residential		134,211		(1,076	)		47,682		(1,140	)		181,893		(2,216	)
U.S government sponsored agency CMO's – residential		8,306		(64	)		17,868		(617	)		26,174		(681	)
Obligations of states and political subdivisions		3,512		(20	)		474		(6	)		3,986		(26	)

Total temporarily impaired	$	152,809	$	(1,201	)	$	76,359	$	(1,901	)	$	229,168	$	(3,102	)

Securities with unrealized losses at year-end 2016 aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position are as follows:

	Less than 12 Months					12 Months or More					Total
Description of Securities	Fair Value		Unrealized Loss			Fair Value		Unrealized Loss			Fair Value		Unrealized Loss

U.S government sponsored agency securities	$	17,207	$	(174	)	$	-	$	-		$	17,207	$	(174	)
U.S government sponsored agency MBS – residential		157,022		(3,173	)		-		-			157,022		(3,173	)
U.S government sponsored agency CMO's – residential		18,374		(373	)		8,750		(284	)		27,124		(657	)
Obligations of states and political subdivisions		7,961		(94	)		-		-			7,961		(94	)

Total temporarily impaired	$	200,564	$	(3,814	)	$	8,750	$	(284	)	$	209,314	$	(4,098	)

The investment portfolio is predominately high credit quality interest-bearing bonds with defined maturity dates backed by the U.S. Government or Government sponsored entities. The unrealized losses at December 31, 2017 and December 31, 2016 are price changes resulting from changes in the interest rate environment and are considered to be temporary declines in the value of the securities. Management does not intend to sell and it is likely that management will not be required to sell the securities prior to their anticipated recovery. Their fair value is expected to recover as the bonds approach their maturity date and/or market conditions improve.