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Investment Securities
 6 Months Ended
Jun. 30, 2020
Investments, Debt and Equity Securities [Abstract]  
Investment Securities INVESTMENT SECURITIES
The amortized cost, gross unrealized gains and losses and the fair value of the Company's available for sale and held to maturity investment securities are as follows:
 June 30, 2020December 31, 2019
(in thousands)Amortized
Cost		Gross
Unrealized
Gains		Gross
Unrealized
Losses		Fair
Value		Amortized
Cost		Gross
Unrealized
Gains		Gross
Unrealized
Losses		Fair
Value
AVAILABLE FOR SALE
U.S. Treasury and U.S. government agencies
$138,413  $1,792  $(347) $139,858  $135,361  $722  $(436) $135,647  
Mortgage-backed securities, residential
448,806  11,891  (303) 460,394  500,245  3,185  (1,551) 501,879  
Mortgage-backed securities, multifamily
45,539  2,267  —  47,806  48,675  633  (123) 49,185  
Asset-backed securities
41,815  —  (1,507) 40,308  —  —  —  —  
Obligations of states and political subdivisions
96,420  2,445  (16) 98,849  58,979  1,077  (35) 60,021  
Debt securities24,566  202  (2) 24,766  9,000  168  —  9,168  
$795,559  $18,597  $(2,175) $811,981  $752,260  $5,785  $(2,145) $755,900  
 June 30, 2020December 31, 2019
(in thousands)Amortized
Cost		Gross
Unrealized
Gains		Gross
Unrealized
Losses		Fair
Value		Amortized
Cost		Gross
Unrealized
Gains		Gross
Unrealized
Losses		Fair
Value
HELD TO MATURITY
U.S. government agencies$30,926  $929  $(2) $31,853  $31,335  $182  $(8) $31,509  
Mortgage-backed securities, residential
65,470  2,147  (2) 67,615  76,229  734  (176) 76,787  
Mortgage-backed securities, multifamily
728  51  —  779  1,750  4  (2) 1,752  
Obligations of states and political subdivisions
10,210  284  —  10,494  12,161  195  —  12,356  
Debt securities2,500  —  —  2,500  2,500  —  —  2,500  
$109,834  $3,411  $(4) $113,241  $123,975  $1,115  $(186) $124,904  
The following table lists contractual maturities of investment securities classified as available for sale and held to maturity as of June 30, 2020. 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.
 Available for SaleHeld to Maturity
(in thousands)Amortized
Cost		Fair
Value		Amortized
Cost		Fair
Value
Due in one year or less$82,362  $82,477  $13,273  $13,394  
Due after one year through five years73,473  75,654  24,397  25,439  
Due after five years through ten years45,335  46,698  5,966  6,014  
Due after ten years58,229  58,644  —  —  
259,399  263,473  43,636  44,847  
Mortgage-backed and asset-backed securities536,160  548,508  66,198  68,394  
Total securities$795,559  $811,981  $109,834  $113,241  
For the six months ended June 30, 2020, proceeds from sales of available-for-sale securities totaled $94.7 million with gross gains on sales and calls of securities of $569,000 and gross losses on sales and calls of securities of $227,000. There were no sales for the six months ended June 30, 2019 or for the three months ended June 30, 2020 and 2019.
Gains or losses on sales of securities are based on the net proceeds and the adjusted carrying amount of the securities sold using the specific identification method.
Securities with a carrying value of approximately $601.7 million and $581.1 million at June 30, 2020 and December 31, 2019, respectively, were pledged to secure public deposits and for other purposes required by applicable laws and regulations.
The following tables indicate the length of time individual securities have been in a continuous unrealized loss position for the periods presented:
June 30, 2020Less Than 12 Months12 Months or LongerTotal
(dollars in thousands)Fair ValueUnrealized
Losses		Fair ValueUnrealized
Losses		Number of
Securities		Fair ValueUnrealized
Losses
AVAILABLE FOR SALE
U.S. Treasury and U.S. government agencies
$65,701  $37  $18,223  $310  10  $83,924  $347  
Mortgage-backed securities, residential58,977  228  6,652  75  27  65,629  303  
Asset-backed securities
40,307  1,507  —  —  6  40,307  1,507  
Obligations of states and political subdivisions
8,234  16  —  —  4  8,234  16  
Debt securities2,055  2  —  —  2  2,055  2  
$175,274  $1,790  $24,875  $385  $49  $200,149  $2,175  
HELD TO MATURITY
U.S. government agencies$2,861  $2  $—  $—  1  $2,861  $2  
Mortgage-backed securities, residential$421  $2  $1  —  $6  422  $2  
$3,282  $4  $1  $—  7  $3,283  $4  
December 31, 2019Less Than 12 Months12 Months or LongerTotal
(dollars in thousands)Fair ValueUnrealized
Losses		Fair ValueUnrealized
Losses		Number of
Securities		Fair ValueUnrealized
Losses
AVAILABLE FOR SALE
U.S. Treasury and U.S. government agencies
$11,625  $39  $41,617  $397  11  $53,242  $436  
Mortgage-backed securities, residential125,782  561  99,489  990  86  225,271  1,551  
Mortgage-backed securities, multifamily7,651  118  4,878  5  3  12,529  123  
Obligations of states and political subdivisions
373  2  6,559  33  5  6,932  35  
$145,431  $720  $152,543  $1,425  105  $297,974  $2,145  
HELD TO MATURITY
U.S. government agencies$3,195  $6  $5,102  $2  2  $8,297  $8  
Mortgage-backed securities, residential12,462  46  10,592  130  16  23,054  176  
Mortgage-backed securities, multifamily—  —  998  2  1  998  2  
$15,657  $52  $16,692  $134  19  $32,349  $186  
Management has evaluated the securities in the above table and has concluded that none of the securities with unrealized losses has impairments that are other-than-temporary. Fair value below cost is solely due to interest rate movements and is deemed temporary.
Investment securities, including mortgage-backed securities, asset-backed securities and corporate securities, are evaluated on a periodic basis to determine if factors are identified that would require further analysis. In evaluating the Company’s securities, management considers the following items:
•The Company’s ability and intent to hold the securities, including an evaluation of the need to sell the security to meet certain liquidity measures, or whether the Company has sufficient levels of cash to hold the identified security in order to recover the entire amortized cost of the security;
•The financial condition of the underlying issuer;
•The credit ratings of the underlying issuer and if any changes in the credit rating have occurred;
•The length of time the security’s fair value has been less than amortized cost; and
•Adverse conditions related to the security or its issuer if the issuer has failed to make scheduled payments or other factors.
If the above factors indicate that an additional analysis is required, management will perform a discounted cash flow analysis evaluating the security.
Equity securities at fair value
The Company has an equity securities portfolio which consists of investments in other financial institutions for market appreciation purposes and investments in Community Reinvestment funds. The market value of these investments was $17.2 million and $16.5 million at June 30, 2020 and December 31, 2019, respectively. The Company recorded purchases of $1.2 million and $161,000 for the six months ended June 30, 2020 and 2019, respectively. For the three and six months ended June 30, 2020 and for the three months ended June 30, 2019, the Company recorded no sales of equity securities and recorded proceeds from sales of equity securities of $1.2 million for the six months ended June 30, 2019. The Company recorded $198,000 and $100,000 in market value gains on equity securities for the second quarter of 2020 and 2019, respectively, and $455,000 in market value losses on equity securities in noninterest income for the six months ended June 30, 2020, and $453,000 in market value gains on equity securities for the six months ended June 30, 2019.
As of June 30, 2020, the equity investments in other financial institutions and Community Reinvestment funds had a market value of $1.0 million and $16.1 million, respectively. The Community Reinvestment funds include $3.5 million that are primarily invested in community development loans that are guaranteed by the Small Business Administration (“SBA”). Because the funds are primarily guaranteed by the federal government, there are minimal changes in market value between accounting periods. These funds can be redeemed with 60 days' notice at the net asset value less unpaid management fees with the approval of the fund manager. As of June 30, 2020, the net amortized cost equaled the market value of the investment. There are no unfunded commitments related to these investments.
The Community Reinvestment funds also include $12.6 million of investment in government guaranteed loans, mortgage-backed securities, small business loans and other instruments supporting affordable housing and economic development as of June 30, 2020. The Company may redeem these funds at the net asset value calculated at the end of the current business day less any unpaid management fees. There are no restrictions on redemptions for the holdings in these investments other than the notice required by the fund manager. There are no unfunded commitments related to these investments.