INVESTMENT SECURITIES

12 Months Ended

Dec. 31, 2018

Investment securities activity:

INVESTMENT SECURITIES

NOTE 5 INVESTMENT SECURITIES

The amortized cost and estimated fair value of securities (all available-for-sale) are as follows: 

					Gross		Gross		Approximate
		Amortized			Unrealized		Unrealized		Fair
(Dollars are in thousands)		Cost			Gains		Losses		Value
December 31, 2018
U.S. Government Agencies	$	19,755		$	26	$	392	$	19,389
Taxable municipals			4,428		-		115		4,313
Corporate bonds			5,422		47		149		5,320
Mortgage backed securities			31,366		11		992		30,385
Total Securities AFS	$	60,971		$	84	$	1,648	$	59,407
December 31, 2017
U.S. Government Agencies	$	23,986		$	79	$	221	$	23,844
Taxable municipals		4,466			9		78		4,397
Corporate bonds		5,437			168		26		5,579
Mortgage backed securities		37,950			3		685		37,268
Total Securities AFS	$	71,839		$	259	$	1,010	$	71,088

The following table details unrealized losses and related fair values in the available-for-sale portfolio. This information is aggregated by the length of time that individual securities have been in a continuous unrealized loss position as of December 31, 2018 and December 31, 2017.

		Less than 12 Months				12 Months or More				Total
(Dollars are in thousands)		Fair Value		Unrealized  Losses		Fair Value		Unrealized  Losses		Fair  Value		Unrealized Losses
December 31, 2018
U.S. Government Agencies	$	5,013	$	68	$	11,585	$	324	$	16,599	$	392
Taxable municipals		-		-		4,049		115		4,049		115
Corporate bonds		1,713		43		1,423		106		3,136		149
Mtg. backed securities		165		2		29,245		990		29,410		992
Total Securities AFS	$	6,891	$	113	$	46,302	$	1,535	$	53,194	$	1,648
December 31, 2017
U.S. Government Agencies	$	7,840	$	69	$	7,189	$	152	$	15,029	$	221
Taxable municipals		2,403		44		767		34		3,170		78
Corporate bonds		1,507		26		-		-		1,507		26
Mtg. backed securities		14,720		145		21,500		540		36,220		685
Total Securities AFS	$	26,470	$	284	$	29,456	$	726	$	55,926	$	1,010

At December 31, 2018, the available-for-sale portfolio included 137 investments for which the fair market value was less than amortized cost. At December 31, 2017, the available-for-sale portfolio included 127 investments for which the fair market value was less than amortized cost. Management evaluates securities for other than temporary impairment at least on a quarterly basis, 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 conditions 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 recovery in fair value. Based on the Company’s analysis, the Company concluded that no securities had an other-than-temporary impairment at December 31, 2018 or December 31, 2017.

Investment securities with a carrying value of $8.0 million and $11.0 million at December 31, 2018 and 2017, respectively, were pledged to secure public deposits and for other purposes required by law.

No investment securities were sold during 2018. During 2017, sales of investment securities generated gross proceeds $3.2 million. Gross realized gains and losses pertaining to the sale of investment securities available for sale are detailed as follows:

	For the years ended December 31,
(Dollars are in thousands)	2018		2017
Gross gains realized	$	—	$	30
Gross losses realized		—		(30	)
Net realized gains	$	—	$	—

The amortized cost and fair value of investment securities at December 31, 2018, by contractual maturity, are shown in the following schedule. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Also, actual maturities may differ from scheduled maturities on amortizing securities, such as mortgage-back securities and collateralized mortgage obligations, because the underlying collateral on these types of securities may be repaid prior to the scheduled maturity date.

						Weighted
(Dollars are in thousands)		Amortized		Fair		Average
Securities Available for Sale		Cost		Value		Yield
Due in one year or less	$	15	$	16		0.79%
Due after one year through five years	5,090		5,015		2.53%
Due after five years through ten years		13,638		13,318		3.35%
Due after ten years		42,228		41,058		2.50%
Total	$	60,971	$	59,407		2.69%

The Bank, as a member of the Federal Reserve Bank and the Federal Home Loan Bank, is required to hold stock in each. The Bank also owns stock in CBB Financial Corp., which is a correspondent of the Bank. These equity securities are restricted from trading and are recorded at a cost of $2.5 million and $2.6 million as of December 31, 2018 and 2017, respectively. The stock has no quoted market value and no ready market exists.