INVESTMENT SECURITIES

Available for Sale

The following table summarizes the amortized cost and the estimated fair value of available for sale debt securities as of the dates indicated:



(Dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
At March 31, 2020:
Government and Government Sponsored Entities:
Residential mortgage backed securities ('MBS") and collateralized mortgage obligations ("CMOs")	$	227,132	$	1,111	$	(1,829	)	$	226,414
Commercial MBS and CMOs	355,196		5,993		(2,246		)	358,943
Agency bonds	56,058		97		(38		)	56,117
Total available for sale debt securities	$	638,386	$	7,201	$	(4,113	)	$	641,474
At December 31, 2019:
Government and Government Sponsored Entities:
Residential MBS and CMOs	$	145,333	$	340	$	(481	)	$	145,192
Commercial MBS and CMOs	353,727		3,267		(825		)	356,169
Agency bonds	123,977		59		(323		)	123,713
Total available for sale debt securities	$	623,037	$	3,666	$	(1,629	)	$	625,074

Net unrealized gains on available for sale investment securities are recorded as accumulated other comprehensive income within stockholders’ equity and totaled $2.2 million and $1.4 million, net of $898 thousand and $593 thousand in tax liabilities, at March 31, 2020 and December 31, 2019, respectively. There were no sales or transfers of available for sale investment securities and no realized gains or losses on these securities during the three months ended March 31, 2020 and 2019.

The following tables summarize the gross unrealized losses and fair value of available for sale debt securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position:



	March 31, 2020
	Less than 12 Months					12 Months or More					Total
(Dollars in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Government and Government Sponsored Entities:
Residential MBS and CMOs	$	83,448	$	(1,038	)	$	40,964	$	(791	)	$	124,412	$	(1,829	)
Commercial MBS and CMOs	91,732		(1,199		)	59,746		(1,047		)	151,478		(2,246		)
Agency bonds	19,243		(38		)	—		—			19,243		(38		)
Total available for sale debt securities	$	194,423	$	(2,275	)	$	100,710	$	(1,838	)	$	295,133	$	(4,113	)

At March 31, 2020, the Company held 83 residential MBS and CMOs of which 65 were in a loss position and 27 had been in a loss position for twelve months or more. The Company held 43 commercial MBS and CMOs of which 19 were in a loss position and 9 had been in a loss position for twelve months or more. The Company held 14 agency bonds of which 2 were in a loss position and none had been in a loss position for twelve months or more.



	December 31, 2019
	Less than 12 Months					12 Months or More					Total
(Dollars in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Government and Government Sponsored Entities:
Residential MBS and CMOs	$	43,623	$	(181	)	$	54,870	$	(300	)	$	98,493	$	(481	)
Commercial MBS and CMOs	95,950		(339		)	57,219		(486		)	153,169		(825		)
Agency bonds	29,471		(86		)	87,405		(237		)	116,876		(323		)
Total available for sale debt securities	$	169,044	$	(606	)	$	199,494	$	(1,023	)	$	368,538	$	(1,629	)

At December 31, 2019, the Company held 76 residential MBS and CMOs of which 45 were in a loss position and 25 had been in a loss position for twelve months or more. The Company held 42 commercial MBS and CMOs of which 19 were in a loss position and 8 had been in a loss position for twelve months or more. The Company held 15 agency bonds of which 12 were in a loss position and 9 had been in a loss position for twelve months or more.

The unrealized losses on the Company’s investments were caused by interest rate changes. In addition, the contractual cash flows of these investments are guaranteed by the U.S. government or agencies sponsored by the U.S. government. Accordingly, it is expected that the securities will not be settled at a price less than amortized cost. Because the decline in market value is attributable to changes in interest rates but not credit quality, and because the Company has the ability and intent to hold those investments until a recovery of fair value, which may be maturity, the Company does not consider these investments to be other-than-temporarily impaired at March 31, 2020 and December 31, 2019.

As of March 31, 2020 and December 31, 2019, there were no holdings of securities of any one issuer in an amount greater than 10% of stockholders' equity, other than the U.S. government and its agencies.

Held to Maturity

The following table summarizes the amortized cost and estimated fair value of held to maturity investment securities as of the dates indicated:



(Dollars in thousands)	Amortized Cost		Gross Unrecognized Gains		Gross Unrecognized Losses			Estimated Fair Value
As of March 31, 2020:
Government Sponsored Entities:
Residential MBS	$	9,651	$	400	$	—		$	10,051
Other investments	81		—		—			81
Total held to maturity investment securities	$	9,732	$	400	$	—		$	10,132
As of December 31, 2019:
Government Sponsored Entities:
Residential MBS	$	10,087	$	205	$	(26	)	$	10,266
Other investments	83		—		—			83
Total held to maturity investment securities	$	10,170	$	205	$	(26	)	$	10,349

The following table summarizes the gross unrecognized losses and fair value of held to maturity investment securities, aggregated by investment category and length of time that individual securities have been in a continuous unrecognized loss position:



	Less than 12 Months				12 Months or More					Total
(Dollars in thousands)	Fair Value		Unrecognized Losses		Fair Value		Unrecognized Losses			Fair Value		Unrecognized Losses
As of December 31, 2019:
Government Sponsored Entities:
Residential MBS	$	—	$	—	$	2,253	$	(26	)	$	2,253	$	(26	)

At March 31, 2020, the Company had 7 held to maturity residential MBS and none were in a loss position. At December 31, 2019, the Company held 7 held to maturity residential MBS of which 2 had been in a loss position for twelve months or more.

The unrecognized losses on the Company’s held to maturity investments at December 31, 2019 were caused by interest rate changes. In addition, the contractual cash flows of these investments are guaranteed by agencies sponsored by the U.S. government. Accordingly, it is expected that the securities will not be settled at a price less than amortized cost. Because the decline in market value is attributable to changes in interest rates but not credit quality, and because the Company has the ability and intent to hold those investments until maturity, the Company does not consider those investments to be other-than-temporarily impaired at December 31, 2019.

The following table summarizes the scheduled maturities of available for sale and held to maturity investment securities as of March 31, 2020:



	March 31, 2020
(Dollars in thousands)	Amortized Cost		Fair Value
Available for sale debt securities
Less than one year	$	10,000	$	10,018
One to five years	30,000		29,987
Five to ten years	3,777		3,781
Beyond ten years	12,281		12,331
MBS and CMOs	582,328		585,357
Total available for sale debt securities	$	638,386	$	641,474
Held to maturity investments securities
Beyond ten years	$	81	$	81
MBS	9,651		10,051
Total held to maturity debt securities	$	9,732	$	10,132

The amortized cost and fair value of debt securities are shown by contractual maturity. Expected maturities may differ from contractual maturities if borrowers have the right to call or prepay obligations with or without call or prepayment penalties. As such, mortgage backed securities and collateralized mortgage obligations are not included in the maturity categories above and instead are shown separately. No securities were pledged as of March 31, 2020 and December 31, 2019.

Equity Securities

Equity securities consist of investments in the CRA Qualified Investment Fund. At March 31, 2020 and December 31, 2019, the fair value of equity securities totaled $12.0 million and $11.8 million, respectively. Prior to January 1, 2019, equity securities were included with available for sale investment securities and stated at fair value with unrealized gains and losses reported in other comprehensive income. In conjunction with the adoption of ASU 2016-01, as of January 1, 2019, $399 thousand of unrealized losses on equity securities were reclassified from other comprehensive income to retained earnings. Subsequent changes in fair value are recognized in other noninterest income and totaled $188 thousand and $144 thousand during the three months ended March 31, 2020 and 2019. There were no sales of equity securities during the three months ended March 31, 2020 and 2019.