XML 41 R12.htm IDEA: XBRL DOCUMENT v3.19.2
Securities
12 Months Ended
Jun. 30, 2019
Securities [Abstract]  
Securities
Note 3.  Securities

Greene County Bancorp, Inc.’s current policies generally limit securities investments to U.S. Government and securities of government sponsored enterprises, federal funds sold, municipal bonds, corporate debt obligations and certain mutual funds.  In addition, the Company’s policies permit investments in mortgage-backed securities, including securities issued and guaranteed by Fannie Mae, Freddie Mac, and GNMA, and collateralized mortgage obligations issued by these entities.  As of June 30, 2019, all mortgage-backed securities including collateralized mortgage obligations were securities of government sponsored enterprises, no private-label mortgage-backed securities or collateralized mortgage obligations were held in the securities portfolio.  The Company’s investments in state and political subdivisions securities generally are municipal obligations that are general obligations supported by the general taxing authority of the issuer, and in some cases are insured.  The obligations issued by school districts are supported by state aid.  Primarily, these investments are issued by municipalities within New York State.

The Company’s current securities investment strategy utilizes a risk management approach of diversified investing among three categories: short-, intermediate- and long-term. The emphasis of this approach is to increase overall investment securities yields while managing interest rate risk.  The Company will only invest in high quality securities as determined by management’s analysis at the time of purchase.  The Company generally does not engage in any derivative or hedging transactions, such as interest rate swaps or caps.

Securities at June 30, 2019 consisted of the following:

(In thousands)
 
Amortized Cost
  
Gross Unrealized
Gains
  
Gross Unrealized
Losses
  
Estimated
Fair Value
 
Securities available-for-sale:
            
U.S. government sponsored enterprises
 
$
5,522
  
$
31
  
$
-
  
$
5,553
 
State and political subdivisions
  
95,782
   
788
   
-
   
96,570
 
Mortgage-backed securities-residential
  
2,634
   
31
   
20
   
2,645
 
Mortgage-backed securities-multi-family
  
16,151
   
259
   
-
   
16,410
 
Corporate debt securities
  
1,513
   
37
   
-
   
1,550
 
Total securities available-for-sale
  
121,602
   
1,146
   
20
   
122,728
 
Securities held-to-maturity:
                
U.S. government sponsored enterprises
  
9,249
   
1
   
14
   
9,236
 
State and political subdivisions
  
152,358
   
6,212
   
23
   
158,547
 
Mortgage-backed securities-residential
  
4,570
   
97
   
-
   
4,667
 
Mortgage-backed securities-multi-family
  
134,970
   
3,122
   
17
   
138,075
 
Corporate debt securities
  
1,478
   
18
   
25
   
1,471
 
Other securities
  
1,583
   
34
   
-
   
1,617
 
Total securities held-to-maturity
  
304,208
   
9,484
   
79
   
313,613
 
Total securities
 
$
425,810
  
$
10,630
  
$
99
  
$
436,341
 

Securities at June 30, 2018 consisted of the following:

(In thousands)
 
Amortized Cost
  
Gross Unrealized
Gains
  
Gross Unrealized
Losses
  
Estimated
Fair Value
 
Securities available-for-sale:
            
U.S. government sponsored enterprises
 
$
5,543
  
$
18
  
$
30
  
$
5,531
 
State and political subdivisions
  
92,052
   
204
   
1
   
92,255
 
Mortgage-backed securities-residential
  
3,332
   
13
   
98
   
3,247
 
Mortgage-backed securities-multi-family
  
18,249
   
64
   
244
   
18,069
 
Corporate debt securities
  
1,771
   
-
   
67
   
1,704
 
Total securities available-for-sale
  
120,947
   
299
   
440
   
120,806
 
Securities held-to-maturity:
                
U.S. government sponsored enterprises
  
9,245
   
-
   
278
   
8,967
 
State and political subdivisions
  
136,335
   
3,091
   
532
   
138,894
 
Mortgage-backed securities-residential
  
6,472
   
72
   
7
   
6,537
 
Mortgage-backed securities-multi-family
  
118,780
   
123
   
2,845
   
116,058
 
Corporate debt securities
  
1,466
   
11
   
9
   
1,468
 
Other securities
  
2,252
   
16
   
15
   
2,253
 
Total securities held-to-maturity
  
274,550
   
3,313
   
3,686
   
274,177
 
Total securities
 
$
395,497
  
$
3,612
  
$
4,126
  
$
394,983
 

The following table shows fair value and gross unrealized losses, aggregated by security category and length of time that individual securities have been in a continuous unrealized loss position, at June 30, 2019.

  
Less Than 12 Months
  
More Than 12 Months
  
Total
 
                            
(In thousands, except number of securities)
 
Fair
Value
  
Unrealized
Losses
  
Number of
Securities
  
Fair
Value
  
Unrealized
Losses
  
Number of
Securities
  
Fair
Value
  
Unrealized
Losses
  
Number of
Securities
 
Securities available-for-sale:
                           
Mortgage-backed securities-residential
 
$
856
  
$
20
   
1
  
$
-
  
$
-
   
-
  
$
856
  
$
20
   
1
 
Total securities available-for-sale
  
856
   
20
   
1
   
-
   
-
   
-
   
856
   
20
   
1
 
Securities held-to-maturity:
                                    
U.S. government sponsored enterprises
  
-
   
-
   
-
   
1,986
   
14
   
1
   
1,986
   
14
   
1
 
State and political subdivisions
  
3,541
   
17
   
22
   
2,111
   
6
   
13
   
5,652
   
23
   
35
 
Mortgage-backed securities-multi-family
  
1,250
   
6
   
1
   
3,799
   
11
   
3
   
5,049
   
17
   
4
 
Corporate debt securities
  
-
   
-
   
-
   
452
   
25
   
1
   
452
   
25
   
1
 
Total securities held-to-maturity
  
4,791
   
23
   
23
   
8,348
   
56
   
18
   
13,139
   
79
   
41
 
Total securities
 
$
5,647
  
$
43
   
24
  
$
8,348
  
$
56
   
18
  
$
13,995
  
$
99
   
42
 

The following table shows fair value and gross unrealized losses, aggregated by security category and length of time that individual securities have been in a continuous unrealized loss position, at June 30, 2018.

  
Less Than 12 Months
  
More Than 12 Months
  
Total
 
                            
(In thousands, except number of securities)
 
Fair
Value
  
Unrealized
Losses
  
Number of
Securities
  
Fair
Value
  
Unrealized
Losses
  
Number of
Securities
  
Fair
Value
  
Unrealized
Losses
  
Number of
Securities
 
Securities available-for-sale:
                           
U.S. government sponsored enterprises
 
$
969
  
$
30
   
1
  
$
-
  
$
-
   
-
  
$
969
  
$
30
   
1
 
State and political subdivisions
  
2,094
   
1
   
4
   
-
   
-
   
-
   
2,094
   
1
   
4
 
Mortgage-backed securities-residential
  
2,420
   
98
   
3
   
-
   
-
   
-
   
2,420
   
98
   
3
 
Mortgage-backed securities-multi-family
  
9,177
   
244
   
7
   
-
   
-
   
-
   
9,177
   
244
   
7
 
Corporate debt securities
  
1,450
   
65
   
6
   
254
   
2
   
1
   
1,704
   
67
   
7
 
Total securities available-for-sale
  
16,110
   
438
   
21
   
254
   
2
   
1
   
16,364
   
440
   
22
 
Securities held-to-maturity:
                                    
U.S. government sponsored enterprises
  
7,018
   
227
   
1
   
1,949
   
51
   
1
   
8,967
   
278
   
2
 
State and political subdivisions
  
34,743
   
434
   
167
   
4,352
   
98
   
34
   
39,095
   
532
   
201
 
Mortgage-backed securities-residential
  
1,403
   
7
   
3
   
-
   
-
   
-
   
1,403
   
7
   
3
 
Mortgage-backed securities-multi-family
  
94,927
   
2,586
   
45
   
6,398
   
259
   
3
   
101,325
   
2,845
   
48
 
Corporate debt securities
  
457
   
9
   
1
   
-
   
-
   
-
   
457
   
9
   
1
 
Other securities
  
892
   
14
   
1
   
75
   
1
   
1
   
967
   
15
   
2
 
Total securities held-to-maturity
  
139,440
   
3,277
   
218
   
12,774
   
409
   
39
   
152,214
   
3,686
   
257
 
Total securities
 
$
155,550
  
$
3,715
   
239
  
$
13,028
  
$
411
   
40
  
$
168,578
  
$
4,126
   
279
 

Management evaluated these securities considering the factors as outlined in Note 1 of these consolidated financial statements, and based on this evaluation, the Company does not consider these investments to be other-than-temporarily impaired at June 30, 2019.  Management believes that the reasons for the decline in fair value are due to interest rates, widening credit spreads and market illiquidity at the reporting date.

There were no transfers of securities available-for-sale to held-to-maturity during the year ended June 30, 2019 or 2018. During the years ended June 30, 2019 and 2018, there were no sales of securities and no gains or losses were recognized.  There were no other-than-temporary impairment losses recognized during the years ended June 30, 2019 and 2018.

The estimated fair values of debt securities at June 30, 2019, by contractual maturity are shown below.  Expected maturities may differ from contractual maturities, because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

(In thousands)

Available-for-sale debt securities
 
Amortized Cost
  
Fair Value
 
Within one year
 
$
99,795
  
$
100,607
 
After one year through five years
  
767
   
779
 
After five years through ten years
  
2,255
   
2,287
 
After ten years
  
-
   
-
 
Total available-for-sale debt securities
  
102,817
   
103,673
 
Mortgage-backed and asset-backed securities
  
18,785
   
19,055
 
Total available-for-sale securities
  
121,602
   
122,728
 
         
Held-to-maturity debt securities
        
Within one year
  
23,317
   
23,676
 
After one year through five years
  
72,777
   
74,804
 
After five years through ten years
  
49,864
   
52,133
 
After ten years
  
18,710
   
20,258
 
Total held-to-maturity debt securities
  
164,668
   
170,871
 
Mortgage-backed
  
139,540
   
142,742
 
Total held-to-maturity securities
  
304,208
   
313,613
 
Total securities
 
$
425,810
  
$
436,341
 

As of June 30, 2019 and 2018, respectively, securities with an aggregate fair value of $425.7 million and $383.0 million were pledged as collateral for deposits in excess of FDIC insurance limits for various municipalities placing deposits with Greene County Commercial Bank.  As of June 30, 2019 and 2018, securities with an aggregate fair value of $1.5 million and $1.7 million, respectively, were pledged as collateral for potential borrowings at the Federal Reserve Bank discount window.  Greene County Bancorp, Inc. did not participate in any securities lending programs during the years ended June 30, 2019 or 2018.