Investment Securities

6 Months Ended

Jun. 30, 2015

Investments, Debt and Equity Securities [Abstract]

Investment Securities

Investment Securities

The amortized cost and estimated fair value of available-for-sale investment securities at June 30, 2015 and December 31, 2014 are summarized as follows (in thousands):

	Amortized Cost		Unrealized Gains		Unrealized Losses	Fair Value
June 30, 2015
Available-for-Sale:
U.S. Treasury notes	$	85,946	513		173	86,286
U.S. Agency notes	108,606		258		774	108,090
U.S. Agency mortgage-backed securities	28,152		310		280	28,182
Certificates of deposit	2,580		4		—	2,584
Municipal securities:
Non-taxable	92,873		1,422		483	93,812
Taxable	25,135		416		69	25,482
Mutual funds	2,500		—		28	2,472
Trust preferred securities	49		—		—	49
Equity securities	871		69		37	903
	$	346,712	$	2,992	1,844	347,860
Investment Securities Held-to-Maturity:
Municipal securities:
Non-taxable	24,077		122		206	23,993
Taxable	600		—		3	597
	$	24,677	122		209	24,590
December 31, 2014
Available-for-Sale:
U.S. Treasury notes	$	62,406	290		136	62,560
U.S. Agency notes	84,661		188		1,212	83,637
U.S. Agency mortgage-backed securities	37,838		413		219	38,032
Certificates of deposit	3,076		10		—	3,086
Municipal securities:
Non-taxable	75,727		1,972		304	77,395
Taxable	16,005		465		75	16,395
Mutual funds	2,483		—		22	2,461
Trust preferred securities	50		—		—	50
Equity securities	1,415		372		38	1,749
	$	283,661	3,710		2,006	285,365
Investment Securities Held-to-Maturity:
Municipal securities:
Non-taxable	22,525		108		695	21,938
Taxable	200		—		—	200
	$	22,725	108		695	22,138

Information concerning available-for-sale investment securities with gross unrealized losses at June 30, 2015 and December 31, 2014, aggregated by length of time that individual securities have been in a continuous loss position, is as follows (dollars in thousands):

	Less than Twelve Months			Twelve Months or Greater
	Fair Value		Unrealized Losses	Fair Value		Unrealized Losses
June 30, 2015
Investment Securities Available-for-Sale:
U.S. Treasury notes	$	18,682	123	$	4,857	50
U.S. Agency notes	58,259		327	27,163		447
U.S. Agency mortgage-backed securities	7,165		131	5,070		149
Municipal securities:
Non-taxable	29,020		268	8,174		215
Taxable	9,547		46	877		23
Mutual funds	1,226		20	261		8
Trust preferred securities	49		—	—		—
Equity securities	252		27	121		10
	$	124,200	942	$	46,523	902
Investment Securities Held-to-Maturity:
Municipal securities:
Non-taxable	$	9,742	41	4,190		165
Taxable	397		3	—		—
	$	10,139	44	$	4,190	165
December 31, 2014
Investment Securities Available-for-Sale:
U.S. Treasury notes	$	9,141	7	$	8,774	129
U.S. Agency notes	—		—	65,971		1,212
U.S. Agency mortgage-backed securities	3,795		2	11,456		217
Municipal securities:
Non-taxable	7,211		58	11,419		246
Taxable	3,117		15	3,668		60
Mutual funds	281		12	1,190		10
Trust preferred securities	50		—	—		—
Equity securities	197		29	123		9
	$	23,792	123	$	102,601	1,883
Investment Securities Held-to-Maturity:
Municipal securities:
Non-taxable	$	8,152	540	$	4,200	155
Taxable	—		—	—		—
	$	8,152	540	$	4,200	155

Management has determined that the unrealized losses at June 30, 2015 are primarily due to fluctuations in market interest rates and do not reflect credit quality deterioration of the securities.   Because LCNB does not have the intent to sell the investments and it is more likely than not that LCNB will not be required to sell the investments before recovery of their amortized cost bases, which may be at maturity, LCNB does not consider these investments to be other-than-temporarily impaired.

Contractual maturities of investment securities at June 30, 2015 were as follows (in thousands).  Actual maturities may differ from contractual maturities when issuers have the right to call or prepay obligations.

	Available-for-Sale			Held-to-Maturity
	Amortized Cost		Fair Value	Amortized Cost	Fair Value
Due within one year	$	11,697	11,771	4,581	4,603
Due from one to five years	186,975		188,107	3,487	3,463
Due from five to ten years	113,492		113,337	4,534	4,415
Due after ten years	2,976		3,039	12,075	12,109
	315,140		316,254	24,677	24,590
U.S. Agency mortgage-backed securities	28,152		28,182	—	—
Mutual funds	2,500		2,472	—	—
Trust preferred securities	49		49	—	—
Equity securities	871		903	—	—
	$	346,712	347,860	24,677	24,590

Investment securities with a market value of $209,493,000 and $175,094,000 at June 30, 2015 and December 31, 2014, respectively, were pledged to secure public deposits and for other purposes required or permitted by law.

Certain information concerning the sale of investment securities available-for-sale for the three and six months ended June 30, 2015 and 2014 was as follows (in thousands):

	Three Months Ended   June 30,		Six Months Ended   June 30,
	2015	2014	2015	2014
Proceeds from sales	48,953	—	54,955	26,071
Gross realized gains	234	—	345	2
Gross realized losses	13	—	13	6