Note

Debt

Securities

The following tables present the amortized cost and fair value of available-for-sale debt securities, including gross unrealized gains and losses, as of the dates indicated:

	December 31, 2018
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
(Amounts in thousands)
U.S. Agency securities	$	1,108	$	5	$	-		$	1,113
U.S. Treasury securities		19,970		-		(10	)		19,960
Municipal securities		96,886		912		(509	)		97,289
Mortgage-backed Agency securities		35,513		14		(773	)		34,754
Total	$	153,477	$	931	$	(1,292	)	$	153,116

	December 31, 2017
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
(Amounts in thousands)
U.S. Agency securities	$	11,289	$	17	$	(10	)	$	11,296
U.S. Treasury securities		19,987		-		(16	)		19,971
Municipal securities		101,552		2,203		(107	)		103,648
Single issue trust preferred securities		9,367		-		(483	)		8,884
Mortgage-backed Agency securities		22,095		46		(415	)		21,726
Total	$	164,290	$	2,266	$	(1,031	)	$	165,525

The following table presents the amortized cost and fair value of available-for-sale debt securities, by contractual maturity, as of

December 31, 2018.

Actual maturities could differ from contractual maturities because issuers

may

have the right to call or prepay obligations with or without penalties.

(Amounts in thousands)	U.S. Agency Securities		U.S. Treasury Securities		Municipal Securities		Total
Amortized cost maturity:
One year or less	$	-	$	19,970	$	-	$	19,970
After one year through five years		-		-		14,447		14,447
After five years through ten years		1,108		-		82,439		83,547
After ten years		-		-		-		-
Amortized cost	$	1,108	$	19,970	$	96,886		117,964
Mortgage-backed securities								35,513
Total amortized cost							$	153,477

Fair value maturity:
One year or less	$	-	$	19,960	$	-	$	19,960
After one year through five years		-		-		14,595		14,595
After five years through ten years		1,113		-		82,694		83,807
After ten years		-		-		-		-
Fair value	$	1,113	$	19,960	$	97,289		118,362
Mortgage-backed securities								34,754
Total fair value							$	153,116

The following tables present the amortized cost and fair value of held-to-maturity debt securities, including gross unrealized gains and losses, as of the dates indicated:

	December 31, 2018
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
(Amounts in thousands)
U.S. Agency securities	$	17,887	$	-	$	(20	)	$	17,867
Corporate securities		7,126		-		(3	)		7,123
Total	$	25,013	$	-	$	(23	)	$	24,990

	December 31, 2017
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
(Amounts in thousands)
U.S. Agency securities	$	17,937	$	-	$	(49	)	$	17,888
Corporate securities		7,212		-		(16	)		7,196
Total	$	25,149	$	-	$	(65	)	$	25,084

The following table presents the amortized cost and fair value of held-to-maturity debt securities, by contractual maturity, as of

December 31, 2018.

Actual maturities could differ from contractual maturities because issuers

may

have the right to call or prepay obligations with or without penalties.

(Amounts in thousands)	U.S. Agency Securities		Corporate Notes		Total
Amortized cost maturity:
One year or less	$	17,887	$	7,126	$	25,013
After one year through five years		-		-		-
After five years through ten years		-		-		-
After ten years		-		-		-
Total amortized cost	$	17,887	$	7,126	$	25,013

Fair value maturity:
One year or less	$	17,867	$	7,123	$	24,990
After one year through five years		-		-		-
After five years through ten years		-		-		-
After ten years		-		-		-
Total fair value	$	17,867	$	7,123	$	24,990

The following tables present the geographic composition of municipal securities, by state, where the largest volume of these securities are held in the Company’s portfolio. The tables also present the amortized cost and fair value of the municipal securities, including gross unrealized gains and losses, as of the dates indicated.

	December 31, 2018
	Percent of Municipal Portfolio			Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
(Amounts in thousands)
Minnesota		9.93	%	$	9,586	$	88	$	(15	)	$	9,659
New York		9.40	%		9,063		78		-			9,141
Wisconsin		9.14	%		8,914		36		(53	)		8,897
Ohio		8.78	%		8,541		47		(43	)		8,545
Massachusetts		8.46	%		8,165		93		(27	)		8,231
Texas		7.55	%		7,378		55		(91	)		7,342
Connecticut		5.93	%		5,715		53		-			5,768
Iowa		5.20	%		5,138		10		(90	)		5,058
New Jersey		4.74	%		4,521		87		-			4,608
Other		30.88	%		29,865		365		(190	)		30,040
Total		100.00	%	$	96,886	$	912	$	(509	)	$	97,289

	December 31, 2017
	Percent of Municipal Portfolio			Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
(Amounts in thousands)
New York		10.64	%	$	10,804	$	223	$	-		$	11,027
Minnesota		10.12	%		10,280		211		(1	)		10,490
Wisconsin		8.74	%		8,913		147		-			9,060
Massachusetts		8.57	%		8,691		208		(14	)		8,885
Ohio		8.36	%		8,551		123		(13	)		8,661
Texas		7.22	%		7,388		122		(21	)		7,489
Connecticut		6.82	%		6,929		142		-			7,071
Iowa		5.27	%		5,463		30		(35	)		5,458
New Jersey		4.67	%		4,670		167		-			4,837
Other		29.59	%		29,863		830		(23	)		30,670
Total		100.00	%	$	101,552	$	2,203	$	(107	)	$	103,648

The following tables present the fair values and unrealized losses for available-for-sale debt securities in a continuous unrealized loss position for less than

months and for

months or longer as of the dates indicated:

	December 31, 2018
	Less than 12 Months					12 Months or Longer					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
	Value		Losses			Value		Losses			Value		Losses
(Amounts in thousands)
U.S. Treasury securities	$	19,960	$	(10	)	$	-	$	-		$	19,960	$	(10	)
Municipal securities		7,116		(62	)		18,081		(447	)		25,197		(509	)
Mortgage-backed Agency securities		15,762		(99	)		15,344		(674	)		31,106		(773	)
Total	$	42,838	$	(171	)	$	33,425	$	(1,121	)	$	76,263	$	(1,292	)

	December 31, 2017
	Less than 12 Months					12 Months or Longer					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
	Value		Losses			Value		Losses			Value		Losses
(Amounts in thousands)
U.S. Agency securities	$	10,054	$	(10	)	$	-	$	-		$	10,054	$	(10	)
U.S. Treasury securities		19,972		(16	)		-		-			19,972		(16	)
Municipal securities		8,047		(55	)		2,314		(52	)		10,361		(107	)
Single issue trust preferred securities		-		-			8,884		(483	)		8,884		(483	)
Mortgage-backed Agency securities		4,276		(25	)		14,069		(390	)		18,345		(415	)
Total	$	42,349	$	(106	)	$	25,267	$	(925	)	$	67,616	$	(1,031	)

The following tables present the fair values and unrealized losses for held-to-maturity debt securities in a continuous unrealized loss position for less than

months and for

months or longer as of the dates indicated:

	December 31, 2018
	Less than 12 Months				12 Months or Longer					Total
	Fair		Unrealized		Fair		Unrealized			Fair		Unrealized
	Value		Losses		Value		Losses			Value		Losses
(Amounts in thousands)
U.S. Agency securities	$	-	$	-	$	17,867	$	(20	)	$	17,867	$	(20	)
Corporate securities		-		-		7,123		(3	)		7,123		(3	)
Total	$	-	$	-	$	24,990	$	(23	)	$	24,990	$	(23	)

	December 31, 2017
	Less than 12 Months					12 Months or Longer				Total
	Fair		Unrealized			Fair		Unrealized		Fair		Unrealized
	Value		Losses			Value		Losses		Value		Losses
(Amounts in thousands)
U.S. Agency securities	$	17,888	$	(49	)	$	-	$	-	$	17,888	$	(49	)
Corporate securities		7,196		(16	)		-		-		7,196		(16	)
Total	$	25,084	$	(65	)	$	-	$	-	$	25,084	$	(65	)

There were

individual debt securities in an unrealized loss position as of

December 31, 2018,

and their combined depreciation in value represented

0.74%

of the debt securities portfolio. These securities included

securities in a continuous unrealized loss position for

months or longer that the Company does

not

intend to sell, and that it has determined is

not

more likely than

not

going to be required to sell, prior to maturity or recovery. There were

individual debt securities in an unrealized loss position as of

December 31, 2017,

and their combined depreciation in value represented

0.57%

of the debt securities portfolio.

The Company reviews its investment portfolio quarterly for indications of OTTI. The initial indicator of OTTI for debt securities is a decline in fair value below book value and the severity and duration of the decline. The credit-related OTTI is recognized as a charge to noninterest income and the noncredit-related OTTI is recognized in OCI. The Company incurred

credit-related OTTI charges on debt securities in

2018

2017.

2016

the Company incurred credit-related OTTI charges on debt securities of

$4.64

million related to the Company’s change in intent to hold certain securities to recovery. The intent was changed to sell specific trust preferred securities in the Company’s investment portfolio primarily to reduce credit concentrations with

two

issuers. Temporary impairment on debt securities is primarily related to changes in benchmark interest rates, changes in pricing in the credit markets, and other current economic factors. The following table presents the changes in credit-related losses recognized in earnings on debt securities where a portion of the impairment was recognized in OCI during the periods indicated:

	Year Ended December 31,
	2018		2017		2016
(Amounts in thousands)
Beginning balance	$	-	$	-	$	-
Additions for credit losses on securities not previously recognized		-		-		4,646
Additions for credit losses on securities previously recognized		-		-		-
Reduction for securities sold/realized losses		-		-		(4,646	)
Ending balance	$	-	$	-	$	-

The following table presents gross realized gains and losses from the sale of available-for-sale debt securities for the periods indicated:

	Year Ended December 31,
	2018			2017			2016
(Amounts in thousands)
Gross realized gains	$	-		$	-		$	757
Gross realized losses		(618	)		(661	)		(422	)
Net (loss) gain on sale of securities	$	(618	)	$	(661	)	$	335

The carrying amount of securities pledged for various purposes totaled

$38.25

million as of

December 31, 2018,

and

$51.34

million as of

December 31, 2017.