INVESTMENT SECURITIES

12 Months Ended

Dec. 31, 2022

Investments, Debt and Equity Securities [Abstract]

The amortized cost and estimated fair value of debt securities at December 31 are summarized as follows (in thousands):


	Amortized Cost		Unrealized Gains	Unrealized Losses	Fair Value
2022
Debt Securities Available-for-Sale:
U.S. Treasury notes	$	84,927	—	8,480	76,447
U.S. Agency notes	89,160		—	11,184	77,976
Corporate Bonds	7,450		13	778	6,685
U.S. Agency mortgage-backed securities	90,746		5	11,311	79,440

Municipal securities:
Non-taxable	8,892		—	368	8,524
Taxable	46,556		1	5,779	40,778
	$	327,731	19	37,900	289,850

Debt Securities Held-to-Maturity:
Municipal securities:
Non-taxable	$	16,447	10	594	15,863
Taxable	3,431		—	409	3,022
	$	19,878	10	1,003	18,885

2021
Debt Securities Available-for-Sale:
U.S. Treasury notes	$	75,443	57	756	74,744
U.S. Agency notes	89,293		45	2,092	87,246
Corporate Bonds	5,200		70	118	5,152
U.S. Agency mortgage-backed securities	96,018		1,350	692	96,676

Municipal securities:
Non-taxable	8,959		125	18	9,066
Taxable	35,208		531	446	35,293
	$	310,121	2,178	4,122	308,177

Debt Securities Held-to-Maturity:
Municipal securities:
Non-taxable	$	19,403	98	—	19,501
Taxable	3,569		21	4	3,586
	$	22,972	119	4	23,087

Information concerning debt securities with gross unrealized losses at December 31, aggregated by length of time that individual securities have been in a continuous loss position, is as follows (in thousands):


	Less Than Twelve Months			Twelve Months or More
	Fair Value		Unrealized Losses	Fair Value	Unrealized Losses
2022
Available-for-Sale:
U.S. Treasury notes	$	16,521	931	59,927	7,549
U.S. Agency notes	7,729		543	70,247	10,641
Corporate Bonds	2,667		283	3,255	495
U.S. Agency mortgage-backed securities	41,543		3,597	37,282	7,714
Municipal securities:
Non-taxable	6,831		248	893	120
Taxable	22,162		1,951	18,435	3,828
	$	97,453	7,553	190,039	30,347

Held-to-Maturity:
Municipal securities:
Non-taxable	$	9,567	593	31	1
Taxable	2,811		370	212	39
	$	12,378	963	243	40

2021
Available-for-Sale:
U.S. Treasury notes	$	66,891	756	—	—
U.S. Agency notes	58,648		1,257	20,289	835
Corporate Bonds	3,898		102	484	16
U.S. Agency mortgage-backed securities	49,813		692	—	—
Municipal securities:
Non-taxable	1,020		18	—	—
Taxable	18,434		322	3,535	124
	$	198,704	3,147	24,308	975

Held-to-Maturity:
Municipal securities:
Non-taxable	$	46	—	—	—
Taxable	271		4	—	—
	$	317	4	—	—

Unrealized losses at December 31, 2022 have not been recognized into income because the Company does not have the intent to sell the securities, it is likely that the Company will not be required to sell the securities prior to the anticipated recovery of their amortized costs, and the decline in fair values is largely due to changes in interest rates and other market conditions. The issuers continue to make timely principal and interest payments on the securities. Fair value is expected to recover as the securities approach their maturities.

Contractual maturities of debt securities at December 31, 2022 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	$	13,193	13,004	755	752
Due from one to five years	133,026		119,304	3,628	3,475
Due from five to ten years	90,036		77,467	2,440	2,238
Due after ten years	730		635	13,055	12,420
	236,985		210,410	19,878	18,885
U.S. Agency mortgage-backed securities	90,746		79,440	—	—
	$	327,731	289,850	19,878	18,885

Debt securities with a market value of $166,412,000 and $128,426,000 at December 31, 2022 and 2021, respectively, were pledged to secure public deposits and for other purposes required or permitted by law.

Certain information concerning the sale of debt securities available-for-sale for the years ended December 31 was as follows (in thousands):


	2022		2021	2020
Proceeds from sales	$	—	21,235	8,786
Gross realized gains	—		365	221
Gross realized losses	—		62	—

Realized gains or losses from the sale of securities are computed using the specific identification method.

Equity securities with a readily determinable fair value are carried at fair value, with changes in fair value recognized in other operating income in the Consolidated Statements of Income. Equity securities without a readily determinable fair value are measured at cost minus impairment, if any, plus or minus any changes resulting from observable price changes in orderly transactions, as defined, for identical or similar investments of the same issuer. LCNB was not aware of any impairment or observable price change adjustments that needed to be made at December 31, 2022 on its investments in equity securities without a readily determinable fair value.

The amortized cost and estimated fair value of equity securities with a readily determinable fair value at December 31 are summarized as follows (in thousands):


	2022			2021
	Amortized Cost		Fair Value	Amortized Cost	Fair Value
Mutual funds	$	1,429	1,234	1,410	1,379
Equity securities	778		1,039	778	1,167
Total equity securities with a readily determinable fair value	$	2,207	2,273	2,188	2,546

Certain information concerning changes in fair value of equity securities with a readily determinable fair value for the years ended December 31 was as follows (in thousands):


	2022		2021	2020
Net gains (losses) recognized	$	(292)	141	675
Less net realized gains on equity securities sold	—		—	658
Unrealized gains (losses) recognized and still held at period end	$	(292)	141	17