2.	INVESTMENT SECURITIES

The amortized cost and estimated fair value of investment securities are as follows:

	September 30, 2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Fair Value
Securities available-for-sale	(in thousands)
U.S. government agency notes	$	3,762	$	8	$	(31	)	$	3,739
U.S. government agency collateralized mortgage obligations ("CMO")		18,175		65		(76	)		18,164
Equity securities: Farmer Mac class A stock		66		13		-			79
Total	$	22,003	$	86	$	(107	)	$	21,982

Securities held-to-maturity
U.S. government agency mortgage backed securities ("MBS")	$	9,218	$	402	$	(10	)	$	9,610
Total	$	9,218	$	402	$	(10	)	$	9,610

	December 31, 2015
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Fair Value
Securities available-for-sale	(in thousands)
U.S. government agency notes	$	11,257	$	5	$	(115	)	$	11,147
U.S. government agency CMO		12,235		54		(58	)		12,231
Equity securities: Farmer Mac class A stock		66		-		(3	)		63
Total	$	23,558	$	59	$	(176	)	$	23,441

Securities held-to-maturity
U.S. government agency MBS	$	7,025	$	374	$	-		$	7,399
Total	$	7,025	$	374	$	-		$	7,399

At September 30, 2016 and December 31, 2015, $31.2 million and $30.5 million of securities at carrying value, respectively, were pledged to the Federal Home Loan Bank (“FHLB”), as collateral for current and future advances.

The maturity periods and weighted average yields of investment securities at September 30, 2016 and December 31, 2015 were as follows:

	September 30, 2016
	Less than One Year					One to Five Years					Five to Ten Years					Over Ten Years					Total
	Amount		Yield			Amount		Yield			Amount		Yield			Amount		Yield			Amount		Yield
Securities available-for-sale	(dollars in thousands)
U.S. government agency notes	$	2,001		2.6	%	$	-		-		$	1,738		1.3	%	$	-		-		$	3,739		2.0	%
U.S. government agency CMO		-		-			8,316		1.2	%		8,423		1.1	%		1,425		1.3	%		18,164		1.2	%
Farmer Mac class A stock		-		-			-		-			-		-			-		-			79		-
Total	$	2,001		2.6	%	$	8,316		1.2	%	$	10,161		1.1	%	$	1,425		1.3	%	$	21,982		1.3	%

Securities held-to-maturity
U.S. government agency MBS	$	-		-		$	3,548		3.7	%	$	5,670		2.6	%	$	-		-		$	9,218		3.0	%
Total	$	-		-		$	3,548		3.7	%	$	5,670		2.6	%	$	-		-		$	9,218		3.0	%

	December 31, 2015
	Less than One Year					One to Five Years					Five to Ten Years					Over Ten Years					Total
	Amount		Yield			Amount		Yield			Amount		Yield			Amount		Yield			Amount		Yield
Securities available-for-sale	(dollars in thousands)
U.S. government agency notes	$	8,957		2.9	%	$	-		-		$	2,190		0.9	%	$	-		-		$	11,147		2.5	%
U.S. government agency CMO		-		-			4,337		1.3	%		4,527		0.7	%		3,367		1.2	%		12,231		1.0	%
Farmer Mac class A stock		-		-			-		-			-		-			-		-			63		-
Total	$	8,957		2.9	%	$	4,337		1.3	%	$	6,717		0.8	%	$	3,367		1.2	%	$	23,441		1.7	%

Securities held-to-maturity
U.S. government agency MBS	$	-		-		$	1,746		3.6	%	$	5,279		3.1	%	$	-		-		$	7,025		3.2	%
Total	$	-		-		$	1,746		3.6	%	$	5,279		3.1	%	$	-		-		$	7,025		3.2	%

The amortized cost and fair value of investment securities by contractual maturities as of the periods presented were as shown below:

	September 30,				December 31,
	2016				2015
	Amortized Cost		Estimated Fair Value		Amortized Cost		Estimated Fair Value
Securities available-for-sale	(in thousands)
Due in one year or less	$	1,993	$	2,001	$	9,053	$	8,957
After one year through five years		8,292		8,316		4,335		4,337
After five years through ten years		10,178		10,161		6,713		6,717
After ten years		1,474		1,425		3,391		3,367
Farmer Mac class A stock		66		79		66		63
	$	22,003	$	21,982	$	23,558	$	23,441
Securities held-to-maturity
Due in one year or less	$	-	$	-	$	-	$	-
After one year through five years		3,548		3,803		1,746		1,888
After five years through ten years		5,670		5,807		5,279		5,511
After ten years		-		-		-		-
	$	9,218	$	9,610	$	7,025	$	7,399

Actual maturities may differ from contractual maturities as borrowers or issuers have the right to prepay or call the investment securities. Changes in interest rates may also impact prepayments.

The following tables show all securities that are in an unrealized loss position:

	September 30, 2016
	Less Than Twelve Months				More Than Twelve Months				Total
	Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value
Securities available-for-sale	(in thousands)
U.S. government agency notes	$	-	$	-	$	31	$	1,738	$	31	$	1,738
U.S. government agency CMO		25		8,325		51		1,749		76		10,074
Equity securities: Farmer Mac class A stock		-		-		-				-		-
	$	25	$	8,325	$	82	$	3,487	$	107	$	11,812
Securities held-to-maturity
U.S. Government-agency MBS	$	10	$	2,682	$	-	$	-	$	10	$	2,682
Total	$	10	$	2,682	$	-	$	-	$	10	$	2,682

	December 31, 2015
	Less Than Twelve Months				More Than Twelve Months				Total
	Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value
Securities available-for-sale	(in thousands)
U.S. government agency notes	$	48	$	7,224	$	67	$	1,924	$	115	$	9,148
U.S. government agency CMO		9		1,654		49		1,945		58		3,599
Equity securities: Farmer Mac class A stock		-		-		3		63		3		63
	$	57	$	8,878	$	119	$	3,932	$	176	$	12,810
Securities held-to-maturity
U.S. Government-agency MBS	$	-	$	-	$	-	$	-	$	-	$	-
Total	$	-	$	-	$	-	$	-	$	-	$	-

As of September 30, 2016 and December 31, 2015, there were 14 and nine securities, respectively, in an unrealized loss position. Declines in the fair value of held-to-maturity and available-for-sale securities below their cost that are deemed to be other-than-temporary are reflected in earnings as realized losses. In estimating other-than-temporary impairment losses, management considers, among other things (i) the length of time and the extent to which the fair value has been less than cost (ii) the financial condition and near-term prospects of the issuer and (iii) the Company’s intent to sell an impaired security and if it is not more likely than not it will be required to sell the security before the recovery of its amortized basis.

The unrealized losses are primarily 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, 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 September 30, 2016 and December 31, 2015, management believes the impairments detailed in the table above are temporary and no other-than-temporary impairment loss has been realized in the Company’s consolidated income statements.