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Investment Securities
 9 Months Ended
Sep. 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:
 September 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
$71,953 $1,640 $(318)$73,275 $135,361 $722 $(436)$135,647 
Mortgage-backed securities, residential
421,453 10,583 (246)431,790 500,245 3,185 (1,551)501,879 
Mortgage-backed securities, multifamily
42,943 2,107 (13)45,037 48,675 633 (123)49,185 
Asset-backed securities
41,354 — (643)40,711 — — — — 
Obligations of states and political subdivisions
162,296 2,859 (445)164,710 58,979 1,077 (35)60,021 
Debt securities27,559 250 (1)27,808 9,000 168 — 9,168 
$767,558 $17,439 $(1,666)$783,331 $752,260 $5,785 $(2,145)$755,900 
 September 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$25,805 $853 $— $26,658 $31,335 $182 $(8)$31,509 
Mortgage-backed securities, residential
60,737 2,133 (1)62,869 76,229 734 (176)76,787 
Mortgage-backed securities, multifamily
717 54 — 771 1,750 4 (2)1,752 
Obligations of states and political subdivisions
8,134 273 — 8,407 12,161 195 — 12,356 
Debt securities2,500 — — 2,500 2,500 — — 2,500 
$97,893 $3,313 $(1)$101,205 $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 September 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$14,138 $14,207 $8,697 $8,791 
Due after one year through five years73,990 76,199 21,870 22,847 
Due after five years through ten years45,274 46,617 5,872 5,927 
Due after ten years128,406 128,770 — — 
261,808 265,793 36,439 37,565 
Mortgage-backed and asset-backed securities505,750 517,538 61,454 63,640 
Total securities$767,558 $783,331 $97,893 $101,205 
There were no sales of available-for-sale securities for the three months ended September 30, 2020 and 2019 or for the nine months ended September 30, 2019. For the nine months ended September 30, 2020, proceeds from sales of available-for-sale securities totaled $94.7 million with gross gains on sales of securities of $569,000 and gross losses on sales of securities of $227,000. 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 $578.5 million and $581.1 million at September 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:
September 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
$4,993 $2 $21,228 $316 7 $26,221 $318 
Mortgage-backed securities, residential57,063 175 6,021 71 27 63,084 246 
Mortgage-backed securities, multifamily2,557 13 — — 2 2,557 13 
Asset-backed securities
40,711 643 — — 6 40,711 643 
Obligations of states and political subdivisions
51,342 445 — — 31 51,342 445 
Debt securities1,055 1 — — 1 1,055 1 
$157,721 $1,279 $27,249 $387 $74 $184,970 $1,666 
HELD TO MATURITY
Mortgage-backed securities, residential$119 $1 $25 — $5 144 $1 
$119 $1 $25 $— 5 $144 $1 
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 tables 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 $14.1 million and $16.5 million at September 30, 2020 and December 31, 2019, respectively. The Company recorded purchases of $1.2 million and $259,000 for the nine months ended September 30, 2020 and 2019, respectively. For the three and nine months ended September 30, 2020 and for the three months ended September 30, 2019, the Company recorded no sales of equity securities and recorded proceeds from sales of equity securities of $1.2 million for the nine months ended September 30, 2019. The Company recorded a market value loss of $170,000 for the third quarter of 2020 and $72,000 in market value gain for the third quarter of 2019 on equity securities. For the nine months ended September 30, 2020, the Company recorded $625,000 in market value losses and $525,000 in market value gains for the nine months ended September 30, 2019 on equity securities. Market value gain or loss on equity securities are recorded in noninterest income.
As of September 30, 2020, the equity investments in other financial institutions and Community Reinvestment funds had a market value of $898,000 and $13.2 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 September 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 $9.7 million of investment in government guaranteed loans, mortgage-backed securities, small business loans and other instruments supporting affordable housing and economic development as of September 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.