Note 4 – Investments

The amortized cost, gross unrealized gains and losses, and fair value of investment securities at September 30, 2015 and December 31, 2014 were as follows (in thousands):

		Gross	Gross
	Amortized	Unrealized	Unrealized	Fair
September 30, 2015	Cost	Gains	Losses	Value
Available-for-sale securities:
U.S. agency securities	$ 163,012	$ 1,113	$ (23)	$ 164,102
Obligations of state and political subdivisions	95,374	2,946	(155)	98,165
Corporate obligations	12,643	103	(39)	12,707
Mortgage-backed securities in
government sponsored entities	23,635	305	(41)	23,899
Equity securities in financial institutions	1,319	448	(10)	1,757
Total available-for-sale securities	$ 295,983	$ 4,915	$ (268)	$ 300,630

December 31, 2014
Available-for-sale securities:
U.S. agency securities	$ 150,847	$ 638	$ (600)	$ 150,885
U.S. treasury securities	4,944	-	(95)	4,849
Obligations of state and political subdivisions	101,281	3,854	(99)	105,036
Corporate obligations	13,853	190	(85)	13,958
Mortgage-backed securities in
government sponsored entities	29,397	368	(37)	29,728
Equity securities in financial institutions	1,137	553	-	1,690
Total available-for-sale securities	$ 301,459	$ 5,603	$ (916)	$ 306,146

The following table shows the Company’s gross unrealized losses and fair value of the Company’s investments with unrealized losses that are not deemed to be other-than-temporarily impaired, aggregated by investment category and length of time, which individual securities have been in a continuous unrealized loss position, at September 30, 2015 and December 31, 2014 (in thousands). As of September 30, 2015, the Company owned 46 securities whose fair value was less than their cost basis.

September 30, 2015	Less than Twelve Months		Twelve Months or Greater		Total
		Gross		Gross		Gross
	Fair	Unrealized	Fair	Unrealized	Fair	Unrealized
	Value	Losses	Value	Losses	Value	Losses
U.S. agency securities	$ 10,067	$ (16)	$ 10,986	$ (7)	$ 21,053	$ (23)
Obligations of state and political subdivisions	17,133	(104)	4,747	(51)	21,880	(155)
Corporate obligations	5,399	(23)	2,167	(16)	7,566	(39)
Mortgage-backed securities in
government sponsored entities	4,317	(31)	250	(10)	4,567	(41)
Equity securities in financial institutions	590	(10)	-	-	590	(10)
Total securities	$ 37,506	$ (184)	$ 18,150	$ (84)	$ 55,656	$ (268)

December 31, 2014
U.S. agency securities	$ 27,382	$ (110)	$ 43,642	$ (490)	$ 71,024	$ (600)
U.S. treasury securities	-	-	4,849	(95)	4,849	(95)
Obligations of state and political subdivisions	3,596	(19)	8,584	(80)	12,180	(99)
Corporate obligations	505	(1)	7,707	(84)	8,212	(85)
Mortgage-backed securities in
government sponsored entities	5,025	(4)	2,229	(33)	7,254	(37)
Total securities	$ 36,508	$ (134)	$ 67,011	$ (782)	$ 103,519	$ (916)

As of September 30, 2015, the Company’s investment securities portfolio contained unrealized losses on agency securities issued or backed by the full faith and credit of the United States government or are generally viewed as having the implied guarantee of the U.S. government, obligations of states and political subdivisions, corporate obligations, mortgage backed securities issued by government sponsored entities, and equity securities in financial institutions. For fixed maturity investments management considers whether the present value of cash flows expected to be collected are less than the security’s amortized cost basis (the difference defined as the credit loss), the magnitude and duration of the decline, the reasons underlying the decline and the Company’s intent to sell the security or whether it is more likely than not that the Company would be required to sell the security before its anticipated recovery in market value, to determine whether the loss in value is other than temporary. Once a decline in value is determined to be other than temporary, if the Company does not intend to sell the security, and it is more likely than not that it will not be required to sell the security before recovery of the security’s amortized cost basis, the charge to earnings is limited to the amount of credit loss. Any remaining difference between fair value and amortized cost (the difference defined as the non-credit portion) is recognized in other comprehensive income, net of applicable taxes. Otherwise, the entire difference between fair value and amortized cost is charged to earnings. For equity securities where the fair value has been significantly below cost for one year, the Company’s policy is to recognize an impairment loss unless sufficient evidence is available that the decline is not other than temporary and a recovery period can be predicted. The Company has concluded that any impairment of its investment securities portfolio outlined in the above table is not other than temporary and is the result of interest rate changes, sector credit rating changes, or issuer-specific rating changes that are not expected to result in the non-collection of principal and interest during the period.

Proceeds from sales of securities available-for-sale for the nine months ended September 30, 2015 and 2014 were $18,393,000 and $17,338,000, respectively. For the three months ended September 30, 2015 and 2014, sales of available-for-sale securities were $5,187,000 for each period. The gross gains and losses were as follows (in thousands):

	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2015	2014	2015	2014
Gross gains	$ 129	$ 242	$ 441	$ 488
Gross losses	-	-	(11)	-
Net gains	$ 129	$ 242	$ 430	$ 488

Investment securities with an approximate carrying value of $182.7 million and $186.4 million at September 30, 2015 and December 31, 2014, respectively, were pledged to secure public funds and certain other deposits.

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. The amortized cost and fair value of debt securities at September 30, 2015, by contractual maturity, are shown below (in thousands):

	Amortized
	Cost	Fair Value
Available-for-sale debt securities:
Due in one year or less	$ 6,593	$ 6,606
Due after one year through five years	161,984	163,761
Due after five years through ten years	44,998	46,018
Due after ten years	81,089	82,488
Total	$ 294,664	$ 298,873