Investment Securities

The amortized cost and fair values of investment securities at September 30, 2014 and December 31, 2013 are as follows:



	September 30, 2014
			Gross		Gross
	Amortized		Unrealized		Unrealized			Fair
(In Thousands)	Cost		Gains		Losses			Value
Available for sale (AFS)
U.S. Government and agency securities	$	5,935	$	1	$	(140	)	$	5,796
Mortgage-backed securities	10,689		495		(49		)	11,135
Asset-backed securities	2,536		38		(3		)	2,571
State and political securities	108,801		3,779		(798		)	111,782
Other debt securities	90,130		932		(1,326		)	89,736
Total debt securities	218,091		5,245		(2,316		)	221,020
Financial institution equity securities	8,304		938		(21		)	9,221
Other equity securities	3,430		64		(101		)	3,393
Total equity securities	11,734		1,002		(122		)	12,614
Total investment securities AFS	$	229,825	$	6,247	$	(2,438	)	$	233,634



	December 31, 2013
			Gross		Gross
	Amortized		Unrealized		Unrealized			Fair
(In Thousands)	Cost		Gains		Losses			Value
Available for sale (AFS)
U.S. Government and agency securities	$	9,989	$	17	$	(83	)	$	9,923
Mortgage-backed securities	9,966		694		(68		)	10,592
Asset-backed securities	6,700		43		(179		)	6,564
State and political securities	145,121		2,120		(5,446		)	141,795
Other debt securities	108,939		879		(3,045		)	106,773
Total debt securities	280,715		3,753		(8,821		)	275,647
Financial institution equity securities	8,842		1,820		—			10,662
Other equity securities	2,342		28		(67		)	2,303
Total equity securities	11,184		1,848		(67		)	12,965
Total investment securities AFS	$	291,899	$	5,601	$	(8,888	)	$	288,612

The following tables show the Company’s gross unrealized losses and fair value, aggregated by investment category and length of time, that the individual securities have been in a continuous unrealized loss position, at September 30, 2014 and December 31, 2013.



	September 30, 2014
	Less than Twelve Months					Twelve Months or Greater					Total
			Gross					Gross					Gross
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
(In Thousands)	Value		Losses			Value		Losses			Value		Losses
U.S. Government and agency securities	$	1,010	$	(1	)	$	3,816	$	(139	)	$	4,826	$	(140	)
Mortgage-backed securities	3,903		(40		)	891		(9		)	4,794		(49		)
Asset-backed securities	—		—			567		(3		)	567		(3		)
State and political securities	1,816		(11		)	7,722		(787		)	9,538		(798		)
Other debt securities	24,535		(565		)	27,188		(761		)	51,723		(1,326		)
Total debt securities	31,264		(617		)	40,184		(1,699		)	71,448		(2,316		)
Financial institution equity securities	369		(21		)	—		—			369		(21		)
Other equity securities	366		(67		)	766		(34		)	1,132		(101		)
Total equity securities	735		(88		)	766		(34		)	1,501		(122		)
Total	$	31,999	$	(705	)	$	40,950	$	(1,733	)	$	72,949	$	(2,438	)



	December 31, 2013
	Less than Twelve Months					Twelve Months or Greater					Total
			Gross					Gross					Gross
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
(In Thousands)	Value		Losses			Value		Losses			Value		Losses
U.S. Government and agency securities	$	7,740	$	(83	)	$	—	$	—		$	7,740	$	(83	)
Mortgage-backed securities	2,483		(68		)	—		—			2,483		(68		)
Asset-backed securities	3,847		(177		)	712		(2		)	4,559		(179		)
State and political securities	42,577		(2,558		)	8,233		(2,888		)	50,810		(5,446		)
Other debt securities	73,254		(3,045		)	—		—			73,254		(3,045		)
Total debt securities	129,901		(5,931		)	8,945		(2,890		)	138,846		(8,821		)
Financial institution equity securities	—		—			—		—			—		—
Other equity securities	274		(22		)	655		(45		)	929		(67		)
Total equity securities	274		(22		)	655		(45		)	929		(67		)
Total	$	130,175	$	(5,953	)	$	9,600	$	(2,935	)	$	139,775	$	(8,888	)

At September 30, 2014 there were a total of 28 securities in a continuous unrealized loss position for less than twelve months and 35 individual securities that were in a continuous unrealized loss position for twelve months or greater.

The Company reviews its position quarterly and has determined that, at September 30, 2014, the declines outlined in the above table represent temporary declines and the Company does not intend to sell and does not believe it will be required to sell these securities before recovery of their cost basis, which may be at maturity. The Company has concluded that the unrealized losses disclosed above are not other than temporary but are the result of interest rate changes, sector credit ratings changes, or company-specific ratings changes that are not expected to result in the non-collection of principal and interest during the period.

The amortized cost and fair value of debt securities at September 30, 2014, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities since borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.



(In Thousands)	Amortized Cost		Fair Value
Due in one year or less	$	4,650	$	4,718
Due after one year to five years	34,283		34,465
Due after five years to ten years	100,281		99,983
Due after ten years	78,877		81,854
Total	$	218,091	$	221,020

Total gross proceeds from sales of securities available for sale were $98,815,000 and $69,898,000 for the nine months ended September 30, 2014 and 2013, respectively. The following table represents gross realized gains and losses on those transactions:



	Three Months Ended September 30,				Nine Months Ended September 30,
(In Thousands)	2014		2013		2014		2013
Gross realized gains:
U.S. Government and agency securities	$	—	$	—	$	49	$	—
Mortgage-backed securities	13		—		89		—
State and political securities	1,361		276		2,093		1,917
Other debt securities	149		163		611		462
Financial institution equity securities	582		—		710		130
Other equity securities	86		—		205		250
Total gross realized gains	$	2,191	$	439	$	3,757	$	2,759

Gross realized losses:
U.S. Government and agency securities	$	—	$	—	$	45	$	—
State and political securities	9		415		412		475
Other debt securities	37		27		209		27
Other equity securities	—		—		66		—
Total gross realized losses	$	46	$	442	$	732	$	502

There were no impairment charges included in gross realized losses for the three and nine months ended September 30, 2014 and 2013, respectively.

Investment securities with a carrying value of approximately $128,672,000 and $141,876,000 at September 30, 2014 and December 31, 2013, respectively, were pledged to secure certain deposits, repurchase agreements, and for other purposes as required by law.