SECURITIES

The amortized cost, unrealized gains, unrealized losses and estimated fair values of securities at March 31, 2016, December 31, 2015, and March 31, 2015 are summarized as follows:



	March 31, 2016
	Amortized		Unrealized				Estimated
Dollars in thousands	Cost		Gains		Losses		Fair Value
Available for Sale
Taxable debt securities
U.S. Government and agencies and corporations	$	19,757	$	1,231	$	49	$	20,939
Residential mortgage-backed securities:
Government-sponsored agencies	151,895		2,594		596		153,893
Nongovernment-sponsored entities	7,162		58		56		7,164
State and political subdivisions
Water and sewer revenues	250		—		—		250
Corporate debt securities	14,539		38		662		13,915
Total taxable debt securities	193,603		3,921		1,363		196,161
Tax-exempt debt securities
State and political subdivisions
General obligations	40,103		1,926		45		41,984
Water and sewer revenues	7,547		216		—		7,763
Lease revenues	6,284		223		—		6,507
Special tax revenues	3,022		64		—		3,086
Sales tax revenues	2,899		72		—		2,971
Other revenues	12,588		381		3		12,966
Total tax-exempt debt securities	72,443		2,882		48		75,277
Equity securities	77		—		—		77
Total available for sale securities	$	266,123	$	6,803	$	1,411	$	271,515



	December 31, 2015
	Amortized		Unrealized				Estimated
Dollars in thousands	Cost		Gains		Losses		Fair Value
Available for Sale
Taxable debt securities
U.S. Government and agencies and corporations	$	20,461	$	1,063	$	49	$	21,475
Residential mortgage-backed securities:
Government-sponsored agencies	145,586		1,943		795		146,734
Nongovernment-sponsored entities	7,836		82		33		7,885
State and political subdivisions
Water and sewer revenues	250		—		—		250
Other revenues	1,729		—		26		1,703
Corporate debt securities	14,494		—		268		14,226
Total taxable debt securities	190,356		3,088		1,171		192,273
Tax-exempt debt securities
State and political subdivisions
General obligations	52,490		1,767		41		54,216
Water and sewer revenues	7,614		172		—		7,786
Lease revenues	8,671		187		1		8,857
Special tax revenues	4,532		72		—		4,604
Other revenues	12,703		290		14		12,979
Total tax-exempt debt securities	86,010		2,488		56		88,442
Equity securities	77		—		—		77
Total available for sale securities	$	276,443	$	5,576	$	1,227	$	280,792



	March 31, 2015
	Amortized		Unrealized				Estimated
Dollars in thousands	Cost		Gains		Losses		Fair Value
Available for Sale
Taxable debt securities:
U.S. Government and agencies and corporations	$	21,650	$	1,227	$	40	$	22,837
Residential mortgage-backed securities:
Government-sponsored agencies	153,904		3,412		501		156,815
Nongovernment-sponsored agencies	11,034		105		71		11,068
State and political subdivisions:
General obligations	1,617		34		—		1,651
Water and sewer revenues	1,969		21		—		1,990
Lottery/casino revenues	3,084		9		28		3,065
Other revenues	1,697		67		—		1,764
Corporate debt securities	6,675		—		10		6,665
Total taxable debt securities	201,630		4,875		650		205,855
Tax-exempt debt securities:
State and political subdivisions:
General obligations	47,947		2,050		136		49,861
Water and sewer revenues	10,302		278		1		10,579
Special tax revenues	2,272		53		—		2,325
Lottery/casino revenues	2,800		163		—		2,963
Other revenues	10,246		313		14		10,545
Total tax-exempt debt securities	73,567		2,857		151		76,273
Equity securities	7		—		—		7
Total available for sale securities	$	275,204	$	7,732	$	801	$	282,135

The below information is relative to the five states where issuers with the highest volume of state and political subdivision securities held in our portfolio are located. We own no such securities of any single issuer which we deem to be a concentration.



	March 31, 2016
	Amortized		Unrealized				Estimated
Dollars in thousands	Cost		Gains		Losses		Fair Value

Illinois	$	10,803	$	441	$	10	$	11,234
Michigan	9,473		202		4		9,671
West Virginia	7,676		133		—		7,809
Texas	7,173		406		—		7,579
Washington	5,429		202		—		5,631

Management performs pre-purchase and ongoing analysis to confirm that all investment securities meet applicable credit quality standards. Prior to July 1, 2013, we principally used credit ratings from Nationally Recognized Statistical Rating Organizations (“NRSROs”) to support analyses of our portfolio of securities issued by state and political subdivisions, as we generally do not purchase securities that are rated below the six highest NRSRO rating categories. Beginning July 1, 2013, in addition to considering a security’s NRSRO rating, we now also assess or confirm through an internal review of an issuer’s financial information and other applicable information that: 1) the issuer’s risk of default is low; 2) the characteristics of the issuer’s demographics and economic environment are satisfactory; and 3) the issuer’s budgetary position and stability of tax or other revenue sources are sound.

The maturities, amortized cost and estimated fair values of securities at March 31, 2016, are summarized as follows:



Dollars in thousands	Amortized Cost		Estimated Fair Value
Due in one year or less	$	58,168	$	58,981
Due from one to five years	103,471		105,032
Due from five to ten years	18,437		18,932
Due after ten years	85,970		88,493
Equity securities	77		77
	$	266,123	$	271,515

The proceeds from sales, calls and maturities of available for sale securities, including principal payments received on mortgage-backed obligations, and the related gross gains and losses realized, for the three months ended March 31, 2016 are as follows:



	Proceeds from						Gross realized
Dollars in thousands	Sales		Calls and Maturities		Principal Payments		Gains		Losses
Securities available for sale	$	33,787	$	55	$	8,170	$	562	$	169

We held 53 available for sale securities having an unrealized loss at March 31, 2016. We do not intend to sell these securities, and it is more likely than not that we will not be required to sell these securities before recovery of their amortized cost bases. We believe that this decline in value is primarily attributable to the lack of market liquidity and to changes in market interest rates and not due to credit quality. Accordingly, no additional other-than-temporary impairment charge to earnings is warranted at this time.

Provided below is a summary of securities available for sale which were in an unrealized loss position at March 31, 2016 and December 31, 2015, including debt securities for which a portion of other-than-temporary impairment has been recognized in other comprehensive income.



	March 31, 2016
	Less than 12 months					12 months or more					Total
Dollars in thousands	Estimated Fair Value		Unrealized Loss			Estimated Fair Value		Unrealized Loss			Estimated Fair Value		Unrealized Loss
Temporarily impaired securities
Taxable debt securities
U.S. Government agencies and corporations	$	983	$	(2	)	$	3,017	$	(47	)	$	4,000	$	(49	)
Residential mortgage-backed securities:
Government-sponsored agencies	39,180		(446		)	10,647		(150		)	49,827		(596		)
Nongovernment-sponsored entities	2,141		(12		)	2,530		(44		)	4,671		(56		)
Corporate debt securities	6,993		(662		)	—		—			6,993		(662		)
Tax-exempt debt securities
State and political subdivisions:
General obligations	4,065		(45		)	—		—			4,065		(45		)
Other revenues	1,164		(3		)	—		—			1,164		(3		)
Total temporarily impaired securities	54,526		(1,170		)	16,194		(241		)	70,720		(1,411		)
Total other-than-temporarily
impaired securities	—		—			—		—			—		—
Total	$	54,526	$	(1,170	)	$	16,194	$	(241	)	$	70,720	$	(1,411	)



	December 31, 2015
	Less than 12 months					12 months or more					Total
Dollars in thousands	Estimated Fair Value		Unrealized Loss			Estimated Fair Value		Unrealized Loss			Estimated Fair Value		Unrealized Loss
Temporarily impaired securities
Taxable debt securities
U.S. Government agencies and corporations	$	2,104	$	(2	)	$	3,151	$	(47	)	$	5,255	$	(49	)
Residential mortgage-backed securities:
Government-sponsored agencies	52,970		(569		)	8,672		(226		)	61,642		(795		)
Nongovernment-sponsored entities	2,298		—			2,819		(33		)	5,117		(33		)
State and political subdivisions:
Other revenues	1,702		(26		)	—		—			1,702		(26		)
Corporate debt securities	8,367		(268		)	—		—			8,367		(268		)
Tax-exempt debt securities
State and political subdivisions:
General obligations	5,977		(41		)	—		—			5,977		(41		)
Lease revenues	576		(1		)	—		—			576		(1		)
Other revenues	1,218		(14		)	—		—			1,218		(14		)
Total temporarily impaired securities	75,212		(921		)	14,642		(306		)	89,854		(1,227		)
Total other-than-temporarily
impaired securities	—		—			—		—			—		—
Total	$	75,212	$	(921	)	$	14,642	$	(306	)	$	89,854	$	(1,227	)