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INVESTMENT SECURITIES
 9 Months Ended
Dec. 31, 2019
INVESTMENT SECURITIES  
INVESTMENT SECURITIES

5.      INVESTMENT SECURITIES

The amortized cost and approximate fair value of investment securities consisted of the following at the dates indicated (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    

 

 

    

Gross

    

Gross

    

 

 

 

 

Amortized

 

Unrealized

 

Unrealized

 

Estimated Fair

 

 

Cost

 

Gains

 

Losses

 

 Value

December 31, 2019

 

 

  

 

 

  

 

 

  

 

 

  

Available for sale:

 

 

  

 

 

  

 

 

  

 

 

  

Municipal securities

 

$

4,746

 

$

160

 

$

 —

 

$

4,906

Agency securities

 

 

9,431

 

 

76

 

 

(41)

 

 

9,466

Real estate mortgage investment conduits (1)

 

 

44,577

 

 

166

 

 

(158)

 

 

44,585

Residential mortgage-backed securities (1)

 

 

61,823

 

 

194

 

 

(256)

 

 

61,761

Other mortgage-backed securities (2)

 

 

35,391

 

 

54

 

 

(406)

 

 

35,039

Total available for sale

 

$

155,968

 

$

650

 

$

(861)

 

$

155,757

 

 

 

 

 

 

 

 

 

 

 

 

 

Held to maturity:

 

 

  

 

 

  

 

 

  

 

 

  

Residential mortgage-backed securities (3)

 

$

29

 

$

 1

 

$

 —

 

$

30

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2019

 

 

  

 

 

  

 

 

  

 

 

  

Available for sale:

 

 

  

 

 

  

 

 

  

 

 

  

Municipal securities

 

$

8,885

 

$

30

 

$

(34)

 

$

8,881

Agency securities

 

 

12,426

 

 

22

 

 

(107)

 

 

12,341

Real estate mortgage investment conduits (1)

 

 

40,835

 

 

 —

 

 

(673)

 

 

40,162

Residential mortgage-backed securities (1)

 

 

77,402

 

 

 7

 

 

(1,588)

 

 

75,821

Other mortgage-backed securities (2)

 

 

42,133

 

 

12

 

 

(1,124)

 

 

41,021

Total available for sale

 

$

181,681

 

$

71

 

$

(3,526)

 

$

178,226

 

 

 

 

 

 

 

 

 

 

 

 

 

Held to maturity:

 

 

  

 

 

  

 

 

  

 

 

  

Residential mortgage-backed securities (3)

 

$

35

 

$

 —

 

$

 —

 

$

35

(1)  Comprised of Federal Home Loan Mortgage Corporation (“FHLMC”), Federal National Mortgage Association (“FNMA”) and Ginnie Mae (“GNMA”) issued securities.

(2)  Comprised of U.S. Small Business Administration (“SBA”) issued securities and commercial real estate (“CRE”) secured securities issued by FNMA.

(3)  Comprised of FHLMC and FNMA issued securities.

The contractual maturities of investment securities as of December 31, 2019 are as follows (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Available for Sale

 

Held to Maturity

 

 

Amortized

 

Estimated

 

Amortized

 

Estimated

 

    

Cost

    

Fair Value

    

Cost

    

Fair Value

Due in one year or less

 

$

1,001

 

$

1,008

 

$

 —

 

$

 —

Due after one year through five years

 

 

5,953

 

 

5,934

 

 

26

 

 

27

Due after five years through ten years

 

 

35,598

 

 

35,789

 

 

 3

 

 

 3

Due after ten years

 

 

113,416

 

 

113,026

 

 

 —

 

 

 —

Total

 

$

155,968

 

$

155,757

 

$

29

 

$

30

 

Expected maturities of investment securities may differ from contractual maturities because borrowers may have the right to prepay obligations with or without prepayment penalties.

The fair value of temporarily impaired investment securities, the amount of unrealized losses and the length of time these unrealized losses existed are as follows at the dates indicated (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Less than 12 months

 

12 months or longer

 

Total

 

 

Estimated

 

Unrealized

 

Estimated

 

Unrealized

 

Estimated

 

Unrealized

 

    

Fair Value

    

Losses

    

Fair Value

    

Losses

    

Fair Value

    

Losses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2019

 

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Available for sale:

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

Municipal securities

 

$

 —

 

$

 —

 

$

 —

 

$

 —

 

$

 —

 

$

 —

Agency securities

 

 

1,998

 

 

(11)

 

 

2,969

 

 

(30)

 

 

4,967

 

 

(41)

Real estate mortgage investment conduits (1)

 

 

22,033

 

 

(140)

 

 

2,850

 

 

(18)

 

 

24,883

 

 

(158)

Residential mortgage-backed securities (1)

 

 

8,707

 

 

(18)

 

 

25,116

 

 

(238)

 

 

33,823

 

 

(256)

Other mortgage-backed securities (2)

 

 

15,987

 

 

(246)

 

 

8,509

 

 

(160)

 

 

24,496

 

 

(406)

Total available for sale

 

$

48,725

 

$

(415)

 

$

39,444

 

$

(446)

 

$

88,169

 

$

(861)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2019

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Available for sale:

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

Municipal securities

 

$

 —

 

$

 —

 

$

6,554

 

$

(34)

 

$

6,554

 

$

(34)

Agency securities

 

 

 —

 

 

 —

 

 

6,861

 

 

(107)

 

 

6,861

 

 

(107)

Real estate mortgage investment conduits (1)

 

 

 —

 

 

 —

 

 

40,126

 

 

(673)

 

 

40,126

 

 

(673)

Residential mortgage-backed securities (1)

 

 

 —

 

 

 —

 

 

74,288

 

 

(1,588)

 

 

74,288

 

 

(1,588)

Other mortgage-backed securities (2)

 

 

 —

 

 

 —

 

 

40,409

 

 

(1,124)

 

 

40,409

 

 

(1,124)

Total available for sale

 

$

 —

 

$

 —

 

$

168,238

 

$

(3,526)

 

$

168,238

 

$

(3,526)

(1)

Comprised of FHLMC, FNMA and GNMA issued securities.

(2)

Comprised of SBA issued securities and CRE secured securities issued by FNMA.

 

The unrealized losses on the Company’s investment securities were primarily attributable to increases in market interest rates subsequent to their purchase by the Company. The Company expects the fair value of these securities to recover as the securities approach their maturity dates or sooner if market yields for such securities decline. The Company does not believe that these securities are other than temporarily impaired because of their credit quality or related to any issuer or industry specific event. Based on management’s evaluation and intent, the unrealized losses related to the investment securities in the above tables are considered temporary.

Proceeds from the sale of investment securities totaled $17.8 million for both the three and nine months ended December 31, 2019. Net realized gains on sales of investment securities totaled $30,000 for both the three and nine months ended December 31, 2019. The Company had no sales and realized no gains or losses on investment securities for both the three and nine months ended December 31, 2018. Investment securities available for sale with an amortized cost of $6.9 million and $5.8 million and an estimated fair value of $6.9 million and $5.7 million at December 31, 2019 and March 31, 2019, respectively, were pledged as collateral for government public funds held by the Bank. There were no held to maturity securities pledged as collateral for government public funds held by the Bank at December 31, 2019 and March 31, 2019.