INVESTMENT SECURITIES

The amortized cost and estimated fair value of securities available-for-sale along with gross unrealized gains and losses are summarized as follows (in thousands):



	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
December 31, 2018
U.S. Agencies	$	3,016	$	56	$	—	$	3,072
State, county, and municipal securities	44,639		214		765		44,088
Mortgage-backed securities	370,706		1,092		5,921		365,877
Corporate debt securities	25,567		433		1,283		24,717
Total debt securities available-for-sale	$	443,928	$	1,795	$	7,969	$	437,754

December 31, 2017
State, county, and municipal securities	$	23,042	$	209	$	442	$	22,809
Mortgage-backed securities	263,467		915		4,863		259,519
Corporate debt securities	23,975		837		10		24,802
Total debt securities available-for-sale	$	310,484	$	1,961	$	5,315	$	307,130

The amortized cost and estimated fair value of securities held-to-maturity along with gross unrealized gains and losses are summarized as follows (in thousands):



	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
December 31, 2018
State, county, and municipal securities	$	1,977	$	1	$	10	$	1,968
Mortgage-backed securities	35,782		—		776		35,006
Total debt securities held-to-maturity	$	37,759	$	1	$	786	$	36,974

December 31, 2017
State, county, and municipal securities	$	35,908	$	265	$	22	$	36,151
Mortgage-backed securities	45,144		171		546		44,769
Total debt securities held-to-maturity	$	81,052	$	436	$	568	$	80,920

The amortized cost and fair value of available-for-sale and held-to-maturity securities at December 31, 2018 by contractual maturity are shown below (in thousands).



	Amortized Cost		Fair Value
Available-for-sale:
Due after one year through five years	$	10,894	$	9,710
Due after five years through ten years	35,203		35,620
Due after ten years	27,125		26,547
Mortgage-backed securities¹	370,706		365,877
Total debt securities available-for-sale	$	443,928	$	437,754



	Amortized Cost		Fair Value
Held-to-maturity:
Due in one year or less	$	766	$	766
Due after one year through five years	1,211		1,202
Mortgage-backed securities¹	35,782		35,006
Total debt securities held-to-maturity	$	37,759	$	36,974

¹Actual maturities may differ from contractual maturities because of rights to call or repay obligations with or without penalties and scheduled and unscheduled principal payments on mortgage-backed securities and collateralized mortgage obligations.

The following summarizes the fair value of securities available-for-sale in an unrealized loss position as of the dates indicated (in thousands):



	Less than 12 months				12 Months of More				Total
December 31, 2018	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
State, county, and municipal securities	$	2,573	$	11	$	19,539	$	754	$	22,112	$	765
Mortgage-backed securities	25,706		34		197,036		5,887		222,742		5,921
Corporate debt securities	3,307		1,283		—		—		3,307		1,283
Total	$	31,586	$	1,328	$	216,575	$	6,641	$	248,161	$	7,969

December 31, 2017
State, county, and municipal securities	$	596	$	5	$	12,716	$	437	$	13,312	$	442
Mortgage-backed securities	87,390		772		145,696		4,091		233,086		4,863
Corporate debt securities	2,990		10		—		—		2,990		10
Total	$	90,976	$	787	$	158,412	$	4,528	$	249,388	$	5,315

The following summarizes the fair value of securities held-to-maturity in an unrealized loss position as of the dates indicated (in thousands):



	Less than 12 months				12 Months or More				Total
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
December 31, 2018
State, county, and municipal securities	$	—	$	—	$	1,703	$	10	$	1,703	$	10
Mortgage-backed securities	—		—		35,006		776		35,006		776
Total debt securities	$	—	$	—	$	36,709	$	786	$	36,709	$	786

December 31, 2017
State, county, and municipal securities	$	6,340	$	22	$	—	$	—	$	6,340	$	22
Mortgage-backed securities	13,138		95		12,090		451		25,228		546
Total debt securities	$	19,478	$	117	$	12,090	$	451	$	31,568	$	568

At December 31, 2018, the Company had 107 securities in an unrealized loss position. Management evaluates whether unrealized losses on securities represent impairment that is other than temporary on a quarterly basis. For debt securities, the Company considers its intent to sell or hold the securities and if it is more likely than not the Company will be required to sell the securities. If such impairment is identified, based upon the intent to sell or the more likely than not threshold, the carrying amount of the security is reduced to fair value with a charge to earnings. Upon the result of the aforementioned review, management then reviews for potential other than temporary impairment based upon other qualitative factors. In making this evaluation, management considers changes in market rates relative to those available when the security was acquired, changes in market expectations about the timing of cash flows from securities that can be prepaid, performance of the debt security, and changes in the market’s perception of the issuer’s financial health and the security’s credit quality. If determined that a debt security has incurred other than temporary impairment, then the amount of the credit related impairment is determined. For equity securities, management reviews the near term prospects of the issuer, the nature and cause of the unrealized loss, the severity and duration of the impairments and other factors when determining if an unrealized loss is other than temporary. If a credit loss is evident, the amount of the credit loss is charged to earnings and the non-credit related impairment is recognized through other comprehensive income. At December 31, 2018, there was no intent to sell any of the securities in an unrealized loss position, and it is more likely than not the Company will not be required to sell these securities. Furthermore, the present value of cash flows expected to be collected exceeded the Company's amortized cost basis of the investment securities; therefore, these securities are not deemed to be other than temporarily impaired.

Sales of securities available-for-sale and held-to-maturity securities are summarized in the following table (in thousands):



	December 31, 2018			December 31, 2017
Available-for-sale securities
Proceeds from sales	$	8,965		$	16,979

Gross gains on sales	$	239		$	449
Gross losses on sales	(288		)	(109		)
Net realized (losses) gains on sales	$	(49	)	$	340

Held-to-maturity securities
Proceeds from sales	$	—		$	887

Gross gains on sales	$	—		$	7
Net realized gains on sales	$	—		$	7

In the fourth quarter of 2018, certain debt securities with an aggregate amortized cost of $23.9 million and fair value of $24.0 million were transferred from held-to-maturity securities to available-for-sale securities as part of the adoption of ASU 2017-12, Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities.

The composition of investment securities reflects the strategy of management to maintain an appropriate level of liquidity while providing a relatively stable source of revenue. The securities portfolio may at times be used to mitigate interest rate risk associated with other areas of the balance sheet while also providing a means for the investment of available funds, providing liquidity and supplying investment securities that are required to be pledged as collateral against specific deposits and for other purposes. Securities with an aggregate carrying value of $162.5 million and $177.9 million at December 31, 2018 and 2017, respectively, were pledged to secure public funds on deposit and for other purposes required or permitted by law.