Investment Securities

12 Months Ended

Dec. 31, 2021

Investments, Debt and Equity Securities [Abstract]

Investment Securities

NOTE 3 – INVESTMENT SECURITIES

Investment securities have been classified in the balance sheet according to management’s intent. The Company’s classification of securities at December 31, 2021 and 2020 was as follows (in thousands):

	December 31, 2021									December 31, 2020
	Amortized Cost		Gross unrealized gains		Gross unrealized (losses)			Estimated fair value		Amortized Cost		Gross unrealized gains		Gross unrealized (losses)			Estimated fair value
Securities available-for-sale:
U. S. government agency securities	$	11,550	$	47	$	(94	)	$	11,503	$	16,158	$	258	$	(25	)	$	16,391
State and municipal securities		81,158		2,107		(705	)		82,560		89,081		2,928		(81	)		91,928
Mortgage-backed securities		300,398		2,008		(8,799	)		293,607		332,014		4,892		(543	)		336,363
Asset-backed securities		3,326		13		—			3,339		3,325		—		(132	)		3,193
Other debt securities		67,104		1,514		(231	)		68,387		37,608		819		(87	)		38,340
Total	$	463,536	$	5,689	$	(9,829	)	$	459,396	$	478,186	$	8,897	$	(868	)	$	486,215
Securities held-to-maturity:
State and municipal securities	$	1,782	$	48	$	—		$	1,830	$	2,407	$	97	$	—		$	2,504
Total	$	1,782	$	48	$	—		$	1,830	$	2,407	$	97	$	—		$	2,504

The amortized cost and fair value of debt and equity securities at December 31, 2021, by contractual maturity, are shown below (in thousands). 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. Securities not due at a single maturity date are shown separately.

	Available-for-sale				Held-to-maturity
	Amortized cost		Estimated fair value		Amortized cost		Estimated fair value
Due in less than one year	$	16,256	$	16,355	$	514	$	521
Due one to five years		78,774		80,357		1,268		1,309
Due five to ten years		56,934		58,142		—		—
Due beyond ten years		7,848		7,596		—		—
Mortgage-backed securities		300,398		293,607		—		—
Asset-backed securities		3,326		3,339		—		—
	$	463,536	$	459,396	$	1,782	$	1,830

Results from sales, maturities, prepayments and calls of securities available for sale were as follows (in thousands):

	Year ended December 31
	2021			2020			2019
Proceeds	$	104,733		$	170,001		$	95,692
Gross gains		45			148			116
Gross losses		(17	)		(23	)		(215	)

Securities with a market value of $188.8 million and $163.5 million at December 31, 2021 and 2020, respectively, were pledged to collateralize public deposits, derivative positions and Federal Home Loan Bank advances.

At December 31, 2021 and 2020 there were no holdings of securities of any one issuer, other than the U.S. Government and its agencies, in an amount greater than 10% of shareholders’ equity.

The following tables show the Company’s securities with unrealized losses, aggregated by major security type and length of time in a continuous unrealized loss position (in thousands):

	Less than 12 months					12 months or more					Total
December 31, 2021	Estimated fair value		Gross unrealized losses			Estimated fair value		Gross unrealized losses			Estimated fair value		Gross unrealized losses
U. S. government agency securities	$	2,560	$	(20	)	$	2,737	$	(74	)	$	5,297	$	(94	)
State and municipal securities		15,309		(279	)		12,768		(426	)		28,077		(705	)
Mortgage-backed securities		155,805		(5,291	)		75,934		(3,508	)		231,739		(8,799	)
Asset-backed securities		—		—			—		—			—		—
Other debt securities		30,375		(231	)		—		—			30,375		(231	)
Total temporarily impaired securities	$	204,049	$	(5,821	)	$	91,439	$	(4,008	)	$	295,488	$	(9,829	)
December 31, 2020
U. S. government agency securities	$	1,989	$	(25	)	$	—	$	—		$	1,989	$	(25	)
State and municipal securities		10,463		(81	)		—		—			10,463		(81	)
Mortgage-backed securities		100,291		(480	)		1,449		(63	)		101,740		(543	)
Asset-backed securities		—		—			3,193		(132	)		3,193		(132	)
Other debt securities		6,103		(87	)		—		—			6,103		(87	)
Total temporarily impaired securities	$	118,846	$	(673	)	$	4,642	$	(195	)	$	123,488	$	(868	)

Declines in the fair value of securities below their cost that are deemed to be other-than-temporary are reflected in earnings as realized losses to the extent the impairment is related to credit losses. The amount of the impairment of available for sale securities related to other factors is recognized in other comprehensive income (loss). In estimating other-than-temporary impairment losses, management considers, among other things, the length of time and the extent to which the fair value has been less than cost, the financial condition and near-term prospects of the issuer and the intent and ability of the Company to hold the security for a period of time sufficient to allow for any anticipated recovery in fair value. The unrealized losses shown above are primarily due to increases in market rates over the yields available at the time of purchase of the underlying securities and not credit quality. Because the Company does not intend to sell these securities and it is more likely than not that the Company will not be required to sell the securities before recovery of their amortized cost bases, which may be maturity, the Company does not consider these securities to be other than temporarily impaired at December 31, 2021. There were no other-than-temporary impairments for the years ended December 31, 2021, 2020 or 2019.