Note 2 - Investment Securities

3 Months Ended

Mar. 31, 2017

Notes to Financial Statements

Investments in Debt and Equity Instruments, Cash and Cash Equivalents, Unrealized and Realized Gains (Losses) [Text Block]

2. Investment Securities

Debt and equity securities have been classified in the consolidated balance sheets according to management’s intent. Investment securities at

March

31,

2017

and

December

31,

2016

are summarized as follows:

(In thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
March 31, 2017
Securities available for sale:
Agency mortgage-backed securities	$	120,354	$	76	$	1,999	$	118,431
Agency CMO		15,452		18		264		15,206
Other debt securities:
Agency notes and bonds		70,778		6		695		70,089
Municipal obligations		68,416		894		924		68,386
Subtotal - debt securities		275,000		994		3,882		272,112
Mutual funds		73		0		0		73
Total securities available for sale	$	275,073	$	994	$	3,882	$	272,185
Securities held to maturity:
Agency mortgage-backed securities	$	2	$	0	$	0	$	2
Total securities held to maturity	$	2	$	0	$	0	$	2
December 31, 2016
Securities available for sale:
Agency mortgage-backed securities	$	110,493	$	93	$	2,349	$	108,237
Agency CMO		16,293		23		288		16,028
Other debt securities:
Agency notes and bonds		69,407		14		759		68,662
Municipal obligations		63,189		783		1,129		62,843
Subtotal - debt securities		259,382		913		4,525		255,770
Mutual funds		74		0		0		74
Total securities available for sale	$	259,456	$	913	$	4,525	$	255,844
Securities held to maturity:
Agency mortgage-backed securities	$	2	$	0	$	0	$	2
Total securities held to maturity	$	2	$	0	$	0	$	2

Agency notes and bonds, agency mortgage-backed securities and agency collateralized mortgage obligations (CMO) include securities issued by the Government National Mortgage Association (GNMA), a U.S. government agency, and the Federal National Mortgage Association (FNMA), the Federal Home Loan Mortgage Corporation (FHLMC) and the Federal Home Loan Bank (FHLB), which are government-sponsored enterprises.

The amortized cost and fair value of debt securities as of

March

31,

2017,

by contractual maturity, are shown below. Expected maturities of CMO and mortgage-backed securities

may

differ from contractual maturities because the mortgages underlying the obligations

may

be prepaid without penalty.

	Securities Available for Sale				Securities Held to Maturity
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
(In thousands)
Due in one year or less	$	2,992	$	2,992	$	0	$	0
Due after one year through five years		77,675		77,072		0		0
Due after five years through ten years		22,684		22,545
Due after ten years		35,843		35,866		0		0
		139,194		138,475		0		0
Mortgage-backed securities and CMO		135,806		133,637		2		2
	$	275,000	$	272,112	$	2	$	2

Information pertaining to investment securities available for sale with gross unrealized losses at

March

31,

2017,

aggregated by investment category and the length of time that individual investment securities have been in a continuous position, follows. At

March

31,

2017,

the Company did not have any securities held to maturity with an unrealized loss.

	Number of Investment Positions		Fair Value		Gross Unrealized Losses
(Dollars in thousands)
Continuous loss position less than twelve months:
Agency notes and bonds		22	$	56,787	$	674
Agency CMO		13		10,098		175
Agency mortgage-backed securities		86		113,326		1,987
Muncipal obligations		45		24,057		924
Total less than twelve months		166		204,268		3,760
Continuous loss position more than twelve months:
Agency notes and bonds		1		4,979		21
Agency CMO		6		3,850		89
Agency mortgage-backed securities		1		504		12
Total more than twelve months		8		9,333		122
Total securities available for sale		174	$	213,601	$	3,882

Management evaluates securities for other-than-temporary impairment at least quarterly, and more frequently when economic or market concerns warrant such evaluation. Consideration is given to

(1)

the length of time and the extent to which the fair value has been less than cost,

(2)

the financial condition and near-term prospects of the issuer, and

(3)

the intent and ability of the Company to retain its investment in the issuer for a period of time sufficient to allow for any anticipated recover in fair value.

At

March

31,

2017,

the U.S. government agency debt securities, including agency notes and bonds, mortgage-backed securities and CMO, and municipal obligations in a loss position had depreciated approximately

1.8%

from the amortized cost basis. All of the U.S. government agency securities and municipal obligations are issued by U.S. government agencies, government-sponsored enterprises and municipal governments, or are secured by

first

mortgage loans and municipal project revenues. These unrealized losses related principally to current interest rates for similar types of securities. In analyzing an issuer’s financial condition, management considers whether the securities are issued by the federal government, its agencies or other governments, whether downgrades by bond rating agencies have occurred, and the results of reviews of the issuer’s financial condition. As the Company has the ability to hold the debt securities until maturity, or the foreseeable future if classified as available for sale, no declines are deemed to be other-than-temporary.

While management does not anticipate any credit-related impairment losses at

March

31,

2017,

additional deterioration in market and economic conditions

may

have an adverse impact on credit quality in the future.

The Company did not sell any securities during the

three

months ended

March

31,

2017

or

2016.