
	June 30, 2022
(in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Allowance for Credit Losses		Fair Value
U.S. Treasury and U.S. government agencies	$	389,836	$	138	$	(19,923)	$	—	$	370,051
Mortgage-backed securities, residential	370,700		8		(30,371)		—		340,337
Collateralized mortgage obligations, residential	181,946		2		(9,641)		—		172,307
Mortgage-backed securities, multifamily	1,804		—		(299)		—		1,505
Collateralized mortgage obligations, multifamily	52,779		—		(3,159)		—		49,620
Asset-backed securities	61,587		1		(1,726)		—		59,862
Obligations of states and political subdivisions	23,930		—		(903)		(2)		23,025
Corporate bonds	127,006		99		(1,598)		(2,800)		122,707
Total	$	1,209,588	$	248	$	(67,620)	$	(2,802)	$	1,139,414


	December 31, 2021
(in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Allowance for Credit Losses		Fair Value
U.S. Treasury and U.S. government agencies	$	202,961	$	1,215	$	(789)	$	—	$	203,387
Mortgage-backed securities, residential	238,456		1,250		(1,731)		—		237,975
Collateralized mortgage obligations, residential	191,086		1,693		(1,488)		—		191,291
Mortgage-backed securities, multifamily	1,816		—		(75)		—		1,741
Collateralized mortgage obligations, multifamily	32,254		511		(246)		—		32,519
Asset-backed securities	52,518		153		(87)		—		52,584

Corporate bonds	49,598		959		(15)		(83)		50,459
Total	$	768,689	$	5,781	$	(4,431)	$	(83)	$	769,956


	June 30, 2022
(in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Allowance for Credit Losses		Fair Value
U.S. government agencies	$	16,418	$	13	$	(425)	$	—	$	16,006
Mortgage-backed securities, residential	363,071		23		(43,156)		—		319,938
Collateralized mortgage obligations, residential	13,773		—		(1,705)		—		12,068
Mortgage-backed securities, multifamily	5,139		—		(477)		—		4,662

Obligations of states and political subdivisions	540,347		17		(86,962)		(21)		453,381
Corporate bonds	3,000		—		(223)		(169)		2,608
Total	$	941,748	$	53	$	(132,948)	$	(190)	$	808,663


	December 31, 2021
(in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Allowance for Credit Losses		Fair Value
U.S. government agencies	$	18,672	$	293	$	—	$	—	$	18,965
Mortgage-backed securities, residential	370,247		718		(5,989)		—		364,976
Collateralized mortgage obligations, residential	13,921		168		—		—		14,089
Mortgage-backed securities, multifamily	2,710		26		(2)		—		2,734

Obligations of states and political subdivisions	416,587		810		(5,800)		(21)		411,576
Corporate bonds	3,000		31		—		(160)		2,871
Total	$	825,137	$	2,046	$	(11,791)	$	(181)	$	815,211

During the third quarter of 2021, the Company transferred $494.2 million of previously designated available for sale securities to a held to maturity designation at estimated fair value. The reclassification for the period ended September 30, 2021 was permitted as the Company has appropriately determined the ability and intent to hold these securities as an investment until maturity or call. The securities transferred had an unrealized net gain of $3.8 million at the time of transfer, which is reflected, net of taxes, in accumulated other comprehensive income (loss) on the consolidated balance sheets. Subsequent amortization will be recognized over the life of the securities. The Company recorded amortization, net of tax, of $148,000 and $283,000 during the three and six months ended June 30, 2022, respectively.

The following table lists contractual maturities of investment securities classified as available for sale and held to maturity as of June 30, 2022. Mortgage-backed and asset-backed securities are not shown by maturity because expected maturities may differ from contractual maturities due to underlying loan prepayments of the issuer. 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 Sale				Held to Maturity
(in thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Due in one year or less	$	24,606	$	24,384	$	72,185	$	71,921
Due after one year through five years	254,918		244,056		33,004		32,092
Due after five years through ten years	190,823		181,632		67,896		60,215
Due after ten years	70,425		65,711		386,680		307,767
	540,772		515,783		559,765		471,995
Mortgage-backed and asset-backed securities	668,816		623,631		381,983		336,668
Total	$	1,209,588	$	1,139,414	$	941,748	$	808,663

For the three and six months ended June 30, 2022, there were no sales of available for sale securities. During the three and six months ended June 30, 2021, the Company sold $4.4 million of available for sale securities recording a gain of $9,000. 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.


June 30, 2022	Less Than 12 Months				12 Months or Longer				Total
(dollars in thousands)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Number of Securities	Fair Value		Unrealized Losses
Available for Sale
U.S. Treasury and U.S. government agencies	$	338,126	$	18,373	$	16,698	$	1,550	67	$	354,824	$	19,923
Mortgage-backed securities, residential	326,475		29,130		11,948		1,241		126	338,423		30,371
Collateralized mortgage obligations, residential	142,202		7,592		29,481		2,049		101	171,683		9,641
Mortgage-backed securities, multifamily	—		—		1,505		299		1	1,505		299
Collateralized mortgage obligations, multifamily	48,811		3,069		770		90		19	49,581		3,159
Asset-backed securities	49,524		1,442		7,297		284		16	56,821		1,726
Obligations of states and political subdivisions	22,695		903		—		—		50	22,695		903
Corporate bonds	100,989		1,440		2,842		158		43	103,831		1,598
Total	$	1,028,822	$	61,949	$	70,541	$	5,671	423	$	1,099,363	$	67,620
Held to Maturity
U.S. government agencies	$	14,584	$	425	$	—	$	—	4	$	14,584	$	425
Mortgage-backed securities, residential	310,639		41,624		8,440		1,532		175	319,079		43,156
Collateralized mortgage obligations, residential	12,067		1,705		—		—		12	12,067		1,705
Mortgage-backed securities, multifamily	4,662		477		—		—		4	4,662		477

Obligations of states and political subdivisions	438,702		85,451		5,260		1,511		381	443,962		86,962
Corporate bonds	2,777		223		—		—		1	2,777		223
Total	$	783,431	$	129,905	$	13,700	$	3,043	577	$	797,131	$	132,948


December 31, 2021	Less Than 12 Months				12 Months or Longer				Total
(dollars in thousands)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Number of Securities	Fair Value		Unrealized Losses
Available for Sale
U.S. Treasury and U.S. government agencies	$	76,106	$	322	$	14,670	$	467	15	$	90,776	$	789
Mortgage-backed securities, residential	176,990		1,465		14,582		266		45	191,572		1,731
Collateralized mortgage obligations, residential	86,749		1,429		5,000		59		18	91,749		1,488
Mortgage-backed securities, multifamily	—		—		1,741		75		1	1,741		75
Collateralized mortgage obligations, multifamily	9,083		210		1,072		36		4	10,155		246
Asset-backed securities	14,688		87		—		—		3	14,688		87

Corporate bonds	15,325		(5)		980		20		8	16,305		15
Total	$	378,941	$	3,508	$	38,045	$	923	94	$	416,986	$	4,431
Held to Maturity

Mortgage-backed securities, residential	$	340,474	$	5,882	$	2,376	$	107	96	$	342,850	$	5,989


Collateralized mortgage obligations, multifamily	2,051		2		—		—		1	2,051		2
Obligations of states and political subdivisions	307,827		5,800		—		—		239	307,827		5,800

Total	$	650,352	$	11,684	$	2,376	$	107	336	$	652,728	$	11,791

For available for sale securities, the Company assesses whether a loss is from credit or other factors and considers the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency and adverse conditions related to the security, among other factors. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. If the present value of cash flows is less than the amortized cost, a credit loss exists and an allowance is created, limited by the amount that the fair value is less than the amortized cost basis.

For held to maturity securities, management measures expected credit losses on a collective basis by major security type. All of the mortgage-backed securities are issued by U.S. government agencies and are either explicitly or implicitly guaranteed by the U.S. government, are highly rated by major rating agencies and have a long history of no credit losses and, therefore, the expectation of non-payment is zero. A range of historical losses method is utilized in estimating the net amount expected to be collected for mortgage-backed securities, collateralized mortgage obligations and obligations of states and political subdivisions.

The gross unrealized losses reported for residential mortgage-backed securities relate to investment securities issued by U.S. government sponsored entities such as Federal National Mortgage Association and Federal Home Loan Mortgage Corporation and U.S. government agencies such as Government National Mortgage Association. The total gross unrealized losses, shown in the tables above, were primarily attributable to changes in interest rates and levels of market liquidity, relative to when the investment securities were purchased, and not due to the credit quality of the investment securities.

Credit ratings, which are updated monthly, are a key measure for estimating the probability of a bond's default and for monitoring credit quality on an on-going basis. For bonds other than U.S. Treasuries and bonds issued or guaranteed by U.S. government agencies, credit ratings issued by one or more nationally recognized statistical rating organizations are considered in conjunction with an assessment by the Company's management. Investment grade reflects a credit quality of BBB or above.


June 30, 2022	AAA		AA		A		BBB		Not Rated		Total
(in thousands)
U.S. government agencies	$	16,418	$	—	$	—	$	—	$	—	$	16,418
Mortgage-backed securities, residential	363,071		—		—		—		—		363,071
Collateralized mortgage obligations, residential	13,773		—		—		—		—		13,773
Mortgage-backed securities, multifamily	5,139		—		—		—		—		5,139

Obligations of states and political subdivisions	167,667		315,978		1,044		—		55,658		540,347
Corporate bonds	—		—		—		3,000		—		3,000
Total	$	566,068	$	315,978	$	1,044	$	3,000	$	55,658	$	941,748


December 31, 2021	AAA		AA		A		BBB		Not Rated		Total
(in thousands)
U.S. government agencies	$	18,672	$	—	$	—	$	—	$	—	$	18,672
Mortgage-backed securities, residential	370,247		—		—		—		—		370,247
Collateralized mortgage obligations, residential	13,921		—		—		—		—		13,921
Mortgage-backed securities, multifamily	2,710		—		—		—		—		2,710

Obligations of states and political subdivisions	143,777		270,909		1,068		—		833		416,587
Corporate bonds	—		—		—		3,000		—		3,000
Total	$	549,327	$	270,909	$	1,068	$	3,000	$	833	$	825,137

The Company has an equity securities portfolio, which primarily consists of investments in Community Reinvestment funds. The fair value of the equity portfolio was $17.6 million and $17.4 million at June 30, 2022 and December 31, 2021, respectively. For the six months ended June 30, 2022, the Company recorded no sales of equity securities or Community Reinvestment funds. The Company recorded fair value losses on equity securities of $364,000 for the second quarter of 2022 and fair value gains of $11,000 for the second quarter of 2021. For the six months ended June 30, 2022 and 2021, the Company recorded fair value losses on equity securities of $849,000 and $133,000, respectively. Fair value gain or loss on equity securities are recorded in noninterest income.

As of June 30, 2022, the Company's investments in Community Reinvestment funds include $7.8 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 fair 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, 2022, the net amortized cost equaled the fair value of the investment. There are no unfunded commitments related to these investments.

The Community Reinvestment funds also included $9.8 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, 2022. 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.