
	December 31, 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	$	383,958	$	100	$	(28,419)	$	—	$	355,639
Mortgage-backed securities, residential	351,355		6		(40,748)		—		310,613
Collateralized mortgage obligations, residential	170,502		—		(16,444)		—		154,058
Mortgage-backed securities, multifamily	1,000		—		(215)		—		785
Collateralized mortgage obligations, multifamily	51,108		—		(4,775)		—		46,333
Asset-backed securities	54,105		—		(1,710)		—		52,395
Obligations of states and political subdivisions	22,112		—		(989)		(1)		21,122
Debt securities	124,394		—		(10,718)		(309)		113,367
Total	$	1,158,534	$	106	$	(104,018)	$	(310)	$	1,054,312


	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

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


	December 31, 2022
(in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Allowance for Credit Losses		Fair Value
U.S. government agencies	$	11,099	$	11	$	(725)	$	—	$	10,385
Mortgage-backed securities, residential	360,683		57		(58,128)		—		302,612
Collateralized mortgage obligations, residential	13,026		—		(2,570)		—		10,456
Mortgage-backed securities, multifamily	5,094		—		(747)		—		4,347

Obligations of states and political subdivisions	530,513		2		(100,400)		(7)		430,108
Debt securities	3,000		—		(353)		(100)		2,547
Total	$	923,415	$	70	$	(162,923)	$	(107)	$	760,455


	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
Debt securities	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 investment securities available for sale to a held to maturity designation at estimated fair value. The reclassification is 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 on the consolidated balance sheet. Subsequent amortization will be recognized over the life of the securities. The Company recorded net amortization of $551,000 and $265,000 during the years ended December 31, 2022 and 2021.

The following table lists contractual maturities of investment securities classified as available for sale and held to maturity as of December 31, 2022. 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	$	41,272	$	40,712	$	62,985	$	62,694
Due after one year through five years	262,776		244,661		32,212		30,794
Due after five years through ten years	163,384		147,959		79,764		68,306
Due after ten years	63,032		56,796		369,651		281,246
	530,464		490,128		544,612		443,040
Mortgage-backed and asset-backed securities	628,070		564,184		378,803		317,415
Total	$	1,158,534	$	1,054,312	$	923,415	$	760,455

For the year ended December 31, 2022, there were no sales of available for sale securities. There were proceeds from sales of available for sale securities of $4.4 million with gross gains on sales of securities of $9,000 and no gross losses on sales of securities for the year ended December 31, 2021. There were $130.9 million sales of securities for the year ended December 31, 2020 with gross gains on sales of securities of $1.3 million and gross losses on sales of securities of $248,000. 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.


December 31, 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	$	114,514	$	5,856	$	229,094	$	22,563	67	$	343,608	$	28,419
Mortgage-backed securities, residential	127,363		12,399		182,079		28,349		135	309,442		40,748
Collateralized mortgage obligations, residential	66,316		3,958		87,742		12,486		104	154,058		16,444
Mortgage-backed securities, multifamily	—		—		786		215		1	786		215
Collateralized mortgage obligations, multifamily	37,407		2,861		8,926		1,914		20	46,333		4,775
Asset-backed securities	34,871		977		17,524		733		17	52,395		1,710
Obligations of states and political subdivisions	3,771		276		16,746		713		46	20,517		989
Debt securities	88,489		7,437		22,880		3,281		49	111,369		10,718
Total	$	472,731	$	33,764	$	565,777	$	70,254	439	$	1,038,508	$	104,018
HELD TO MATURITY
U.S. government agencies	$	6,671	$	336	$	2,412	$	389	3	$	9,083	$	725
Mortgage-backed securities, residential	$	32,549	$	2,275	$	264,035	$	55,853	182	$	296,584	$	58,128
Collateralized mortgage obligations, residential	4,668		516		5,787		2,054		12	10,455		2,570
Mortgage-backed securities, multifamily	2,671		376		1,676		371		4	4,347		747

Obligations of states and political subdivisions	82,459		3,689		341,076		96,711		379	423,535		100,400
Debt securities	—		—		2,647		353		1	2,647		353
Total	$	129,018	$	7,192	$	617,633	$	155,731	581	$	746,651	$	162,923


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

Debt securities	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

Mortgage-backed securities, 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, adverse changes to the rating of the security by a rating agency, a security's market yield as compared to similar securities 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 A or above.


December 31, 2022	AAA		AA		A		BBB		Not Rated		Total
(in thousands)
U.S. Treasury and U.S. government agencies	$	11,099	$	—	$	—	$	—	$	—	$	11,099
Mortgage-backed securities, residential	360,683		—		—		—		—		360,683
Collateralized mortgage obligations, residential	13,026		—		—		—		—		13,026
Mortgage-backed securities, multifamily	5,094		—		—		—		—		5,094

Obligations of states and political subdivisions	156,661		317,566		1,020		—		55,266		530,513
Debt securities	—		—		—		3,000		—		3,000
Total	$	546,563	$	317,566	$	1,020	$	3,000	$	55,266	$	923,415


December 31, 2021	AAA		AA		A		BBB		Not Rated		Total
(in thousands)
U.S. Treasury and 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
Debt securities	—		—		—		3,000		—		3,000
Total	$	549,327	$	270,909	$	1,068	$	3,000	$	833	$	825,137

The Company has an equity securities portfolio which consists of investments in Community Reinvestment funds. The fair value of the equity portfolio was $17.3 million and $17.4 million at December 31, 2022 and December 31, 2021, respectively. The Company recorded no sales of equity securities for the years ended December 31, 2022 and 2021 and in 2020, there were $4.1 million of proceeds from sales of equity securities. The Company recorded $1.3 million, $285,000 and $552,000 in fair value losses on equity securities in noninterest income for the years ended December 31, 2022, 2021 and 2020, respectively.

As of December 31, 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 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 December 31, 2022, the net amortized cost equaled the fair value of the investment. There are no unfunded commitments related to these investments.