Note 2 - Investment Securities

9 Months Ended

Sep. 30, 2017

Notes to Financial Statements

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

Note

2.

Investment Securities

The amortized cost and fair value of available-for-sale securities as of

September 30, 2017

and

December 31, 2016,

are as follows:

(Dollars In Thousands)	September 30, 2017
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U. S. Government agency securities	$	13,327	$	91	$	(62	)	$	13,356
Mortgage-backed securities and CMO ’s		21,322		35		(164	)		21,193
Corporate securities		6,490		89		(21	)		6,558
Municipal securities		12,293		284		(90	)		12,487
	$	53,432	$	499	$	(337	)	$	53,594

(Dollars In Thousands)	December 31, 2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U. S. Government agency securities	$	12,422	$	118	$	(96	)	$	12,444
Mortgage-backed securities and CMO ’s		19,979		54		(265	)		19,768
Corporate securities		5,000		66		-			5,066
Municipal securities		15,659		266		(228	)		15,697
	$	53,060	$	504	$	(589	)	$	52,975

U. S. Government agency securities:

The unrealized losses on

fifteen

of the Company’s investments in obligations of the U. S. government were caused by increases in market interest rates over the yields available at the time the securities were purchased.  The contractual terms of those investments do

not

permit the issuer to settle the securities at a price less than the amortized cost basis of the investments. Because the Company does

not

intend to sell the investments before recovery of their amortized cost basis which

may

be maturity, the Company does

not

consider those investments to be other-than-temporarily impaired at

September 30, 2017.

Mortgage-backed securities and CMO

’s:

The unrealized losses on

twenty-two

of the Company’s investments in government-sponsored entity mortgage-backed securities and collateralized mortgage obligations (“CMOs”) were caused by increases in market interest rates over the yields available at the time the securities were purchased. Because the decline in market value is attributable to changes in interest rates and

not

credit quality, and because the Company does

not

intend to sell the investments before recovery of their amortized cost basis, which

may

be maturity, the Company does

not

consider those investments to be other-than-temporarily impaired at

September 30, 2017.

Corporate securities

:

The unrealized loss on

three

of the Company’s investments in corporate securities was caused by increases in market interest rates over the yield at the time the security was purchased. Because the decline in market value is attributable to changes in interest rates and

not

credit quality, the Company does

not

consider this investment to be other-than-temporarily impaired at

September 30, 2017.

Municipal securities:

The unrealized losses on

seven

of the Company’s investments in municipal securities were caused by increases in market interest rates over the yields available at the time the securities were purchased. All municipal securities are investment grade. Because the decline in market value is attributable to changes in interest rates, credit spreads, and

not

credit quality, and because the Company does

not

intend to sell the investments before recovery of their amortized cost basis, which

may

be maturity, the Company does

not

consider those investments to be other-than-temporarily impaired at

September 30, 2017.

The following tables demonstrate the unrealized loss position of available-for-sale securities at

September 30, 2017

and

December 31, 2016.

This information summarizes the amount of time individual securities have been in a continuous, unrealized loss position.

	September 30, 2017
	Less than 12 months					12 months or more					Total
(Dollars In Thousands)	Fair Value		Unrealized Loss			Fair Value		Unrealized Loss			Fair Value		Unrealized Loss
U. S. Government agency securities	$	4,513	$	(36	)	$	1,984	$	(26	)	$	6,497	$	(62	)
Mortgage-backed securities and CMO’s		9,394		(73	)		4,404		(91	)		13,798		(164	)
Corporate securities		2,469		(21	)		-		-			2,469		(21	)
Municipal securities		1,250		(9	)		2,322		(81	)		3,572		(90	)
	$	17,626	$	(139	)	$	8,710	$	(198	)	$	26,336	$	(337	)

	December 31, 2016
	Less than 12 months					12 months or more					Total
(Dollars In Thousands)	Fair Value		Unrealized Loss			Fair Value		Unrealized Loss			Fair Value		Unrealized Loss
U.S. Government agency securities	$	3,492	$	(32	)	$	3,491	$	(64	)	$	6,983	$	(96	)
Mortgage-backed securities and CMO ’s		14,232		(235	)		1,474		(30	)		15,706		(265	)
Corporate securities		500		-			-		-			500		-
Municipal securities		6,967		(223	)		262		(5	)		7,229		(228	)
	$	25,191	$	(490	)	$	5,227	$	(99	)	$	30,418	$	(589	)

There are forty-

seven

debt securities with fair values totaling

$26.3

million considered temporarily impaired at

September 30, 2017.  

As of

September 30, 2017,

the Company does

not

consider any bond in an unrealized loss position to be other-than-temporarily impaired.

The Company realized gains of

$1

65

thousand and

$105

thousand of losses on sales of securities in the

first

nine

months of

2017.

The Company realized gains of

$262

thousand and

$5

thousand of losses during the same period last year.

The amortized cost and fair values of investment securities available for sale at

September 30, 2017,

by contractual maturity are as follows:

(Dollars In Thousands)	Amortized Cost		Fair Value
One year or less	$	246	$	247
Over one through five years		3,153		3,147
Over five through ten years		14,651		14,807
Greater than 10 years		35,382		35,393
	$	53,432	$	53,594