Mortgage-Backed Securities

6 Months Ended

Jun. 30, 2020

Mortgage-backed securities available for sale

Schedule of Available-for-sale Securities [Line Items]

Mortgage-Backed Securities

(7)  Mortgage-Backed Securities

Mortgage-backed securities available for sale at June 30, 2020 and December 31, 2019 were as follows (dollars in thousands):

			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value
June 30, 2020:
Government pass-throughs:
Ginnie Mae	$	26,162	$	576	$	(34)	$	26,704
Fannie Mae		17,965		638		—		18,603
Freddie Mac		12,151		410		—		12,561
Private pass-throughs		19,352		26		(254)		19,124
Collateralized mortgage obligations		11,744		282		(31)		11,995
	$	87,374	$	1,932	$	(319)	$	88,987

December 31, 2019:
Government pass-throughs:
Ginnie Mae	$	21,386	$	188	$	(70)	$	21,504
Fannie Mae		20,537		258		—		20,795
Freddie Mac		13,986		134		(34)		14,086
Private pass-throughs		21,904		—		(301)		21,603
Collateralized mortgage obligations		13,406		110		(26)		13,490
	$	91,219	$	690	$	(431)	$	91,478

Private pass-throughs include Small Business Administration (“SBA”) securities that are each an aggregation of SBA guaranteed portions of loans made by SBA lenders under section 7(a) of the Small Business Act. The guaranty is backed by the full faith and credit of the United States.

There were no sales of mortgage-backed securities during the three or six months ended June 30, 2020. For the three and six months ended June 30, 2019, losses on sales of mortgage-backed securities were $1,000 and proceeds from such sales were $1.3 million.

The amortized cost and fair value of mortgage-backed securities at June 30, 2020, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to repay obligations with or without prepayment penalties (dollars in thousands):

	Amortized Cost		Fair Value
Due after one year through five years	$	888	$	883
Due after five years through ten years		5,120		5,153
Due after ten years		81,366		82,951
Total Mortgage-Backed Securities	$	87,374	$	88,987

The following table presents the fair value and gross unrealized losses on mortgage-backed securities and the length of time that the securities have been in a continuous unrealized loss position at June 30, 2020 and December 31, 2019 (dollars in thousands):

	Less than 12 Months				12 Months or More				Total
			Gross				Gross				Gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Losses		Value		Losses		Value		Losses
June 30, 2020:
Government pass-throughs:
Ginnie Mae	$	4,671	$	(18)	$	1,713	$	(16)	$	6,384	$	(34)
Private pass-throughs		—		—		17,242		(254)		17,242		(254)
Collateralized mortgage obligations		4,456		(31)		—		—		4,456		(31)
Total	$	9,127	$	(49)	$	18,955	$	(270)	$	28,082	$	(319)

December 31, 2019:
Government pass-throughs:
Ginnie Mae	$	4,070	$	(27)	$	3,516	$	(43)	$	7,586	$	(70)
Freddie Mac		5,537		(34)		—		—		5,537		(34)
Private pass-throughs		2,060		(29)		19,197		(272)		21,257		(301)
Collateralized mortgage obligations		562		(2)		3,526		(24)		4,088		(26)
Total	$	12,229	$	(92)	$	26,239	$	(339)	$	38,468	$	(431)

At June 30, 2020, the Company held 28 mortgage-backed securities in an unrealized loss position. The decline in the fair value of these securities resulted primarily from interest rate fluctuations. The Company does not intend to sell these securities nor is it more likely than not that the Company would be required to sell these securities before their anticipated recovery. Additionally, the Company believes the collection of the investment principal and related interest is probable. Based on the above, the Company considers all of the unrealized loss to be temporary impairment loss.

Mortgage-backed securities with a carrying value of $18.3 million and $13.3 million were pledged to secure repurchase agreements and public funds accounts at June 30, 2020 and December 31, 2019, respectively.