Note 3 - Investment Securities Available for Sale

3 Months Ended

Mar. 31, 2023

Notes to Financial Statements

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

3.   INVESTMENT SECURITIES AVAILABLE FOR SALE

The amortized cost and estimated fair value of investment securities at March 31, 2023 and December 31, 2022 consisted of the following, in thousands:

Available-for-Sale	March 31, 2023
			Gross		Gross
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
Debt securities:
U.S. Treasury securities	$	9,957	$	-	$	(187	)	$	9,770
U.S. Government-sponsored agencies collateralized by mortgage obligations - residential		257,668		432		(21,375	)		236,725
U.S. Government-agencies collateralized by mortgage obligations - commercial		122,003		618		(11,960	)		110,661
Obligations of states and political subdivisions		141,328		635		(14,703	)		127,260
	$	530,956	$	1,685	$	(48,225	)	$	484,416

Unrealized losses on available-for-sale investment securities totaling $46,540,000 were recorded, net of $13,758,000 in tax benefit, as accumulated other comprehensive loss within shareholders' equity at March 31, 2023.  No securities were sold during the three months ended March 31, 2023.

Available-for-Sale	December 31, 2022
			Gross		Gross
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
Debt securities:
U.S. Treasury securities	$	9,950	$	-	$	(243	)	$	9,707
U.S. Government-sponsored agencies collateralized by mortgage obligations - residential		238,253		214		(24,059	)		214,408
U.S. Government-agencies collateralized by mortgage obligations - commercial		112,142		143		(12,704	)		99,581
Obligations of states and political subdivisions		138,541		243		(17,777	)		121,007
	$	498,886	$	600	$	(54,783	)	$	444,703

Unrealized losses on available-for-sale investment securities totaling $54,183,000 were recorded, net of $16,017,000 in tax expense, as accumulated other comprehensive income within shareholders' equity at December 31, 2022. No securities were sold during the three months ended March 31, 2022.

There were no transfers of available-for-sale investment securities during the three months ended March 31, 2023 and twelve months ended December 31, 2022. There were no securities classified as held-to-maturity at March 31, 2023 or December 31, 2022.

Investment securities with unrealized losses at March 31, 2023 and December 31, 2022 are summarized and classified according to the duration of the loss period as follows, in thousands:

March 31, 2023	Less than 12 Months				12 Months or More				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Losses		Value		Losses		Value		Losses
Debt securities:
U.S. Treasury securities	$	9,770	$	187	$	-	$	-	$	9,770	$	187
U.S. Government-sponsored agencies collateralized by mortgage obligations - residential		78,713		2,504		115,974		18,871		194,687		21,375
U.S. Government-agencies collateralized by mortgage obligations - commercial		35,350		1,172		49,192		10,788		84,542		11,960
Obligations of states and political subdivisions		34,431		645		62,053		14,058		96,484		14,703
	$	158,264	$	4,508	$	227,219	$	43,717	$	385,483	$	48,225

December 31, 2022	Less than 12 Months				12 Months or More				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Losses		Value		Losses		Value		Losses
Debt securities:
U.S. Treasury securities	$	9,707	$	243	$	-	$	-	$	9,707	$	243
U.S. Government-sponsored agencies collateralized by mortgage obligations - residential		140,117		12,070		54,017		11,989		194,134		24,059
U.S. Government-agencies collateralized by mortgage obligations - commercial		42,799		2,845		42,363		9,859		85,162		12,704
Obligations of states and political subdivisions		89,092		11,421		16,768		6,356		105,860		17,777
	$	281,715	$	26,579	$	113,148	$	28,204	$	394,863	$	54,783

At March 31, 2023, the Company held 411 securities of which 121 were in a loss position for less than twelve months and 221 were in a loss position for  twelve months or more. Of the 411 securities 3 are U.S. Treasury securities, 123 are U.S. Government-sponsored agencies collateralized by residential mortgage obligations, 45 were U.S. Government agencies collateralized by commercial mortgage obligations and 240 were obligations of states and political subdivisions. The unrealized losses relate principally to market rate conditions. All of the securities continue to pay as scheduled. For available-for sale debt securities in an unrealized loss position, the Company first assesses whether it intends to sell, or it is more likely than not that it will be required to sell the security before recovery of its amortized costs basis.  If either of the criteria regarding intent or requirement to sell is met, the security's amortized cost basis is written down to fair value through income.  At March 31, 2023 neither of the criteria regarding intent or requirement to sell was met for any of securities in an unrealized loss position.

The amortized cost and estimated fair value of investment in debt securities at March 31, 2023 by contractual maturity are shown below, in thousands.

	Amortized Cost		Estimated Fair Value
Within one year	$	3,930	$	3,886
After one year through five years		13,675		13,521
After five years through ten years		11,063		10,918
After ten years		122,617		108,705
Investment securities not due at a single maturity date:
Government- agencies commercial mortgage-backed securities		122,003		110,661
Government-sponsored agencies residential mortgage-backed securities		257,668		236,725
	$	530,956	$	484,416

Expected maturities will differ from contractual maturities because the issuers of the securities may have the right to call or prepay obligations with or without call or prepayment penalties.

Investment securities with amortized costs totaling $186,491,000 and $189,358,000 and estimated fair values totaling $165,855,000 and $166,728,000 at March 31, 2023 and December 31, 2022, respectively, were pledged to secure deposits, repurchase agreements and Federal Reserve Bank borrowings.