Investment securities

Investment securities at December 31, 2015 and 2014 consisted of the following (dollars in thousands):



	Amortized cost		Gross unrealized gains		Gross unrealized losses			Estimated fair value
2015
Available-for-sale
U.S. Agency mortgage-backed securities (MBS) *	$	154,691	$	2,698	$	(455	)	$	156,934
Non-agency MBS	118,765		477		(1,016		)	118,226
U.S. Agency asset-backed securities	7,468		800		(23		)	8,245
Corporate debt securities	26,199		121		—			26,320
Mutual fund	525		12		—			537
	$	307,648	$	4,108	$	(1,494	)	$	310,262
Held-to-maturity
U.S. Agency mortgage-backed securities (MBS)	$	98,800	$	1,875	$	(5	)	$	100,670
Tax credit investments	421		—		—			421
Obligations of state and political subdivisions	40,203		968		(2		)	41,169
	$	139,424	$	2,843	$	(7	)	$	142,260

2014
Available-for-sale
U.S. Agency MBS *	$	232,514	$	4,562	$	(896	)	$	236,180
Non-agency MBS	66,872		232		(407		)	66,697
U.S. Agency asset-backed securities	8,192		858		(42		)	9,008
Corporate securities	7,333		137		—			7,470
Mutual fund	514		13		—			527
	$	315,425	$	5,802	$	(1,345	)	$	319,882
Held-to-maturity
U.S. Agency mortgage-backed securities (MBS)	$	110,175	$	2,032	$	—		$	112,207
Tax credit investments	564		—		—			564
Obligations of state and political subdivisions	41,840		962		(18		)	42,784
	$	152,579	$	2,994	$	(18	)	$	155,555

* U.S. Agency MBS included private label MBS of approximately $7.8 million and $9.3 million at December 31, 2015 and 2014, respectively, which are supported by FHA/VA collateral.

The following table presents the fair value and gross unrealized losses of the Bank’s investment securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at December 31, 2015 and 2014 (dollars in thousands):



	Less than 12 months					12 months or more					Total
	Estimated fair value		Unrealized losses			Estimated fair value		Unrealized losses			Estimated fair value		Unrealized losses
2015
Available-for-sale
U.S. Agency MBS	$	23,630	$	(123	)	$	34,576	$	(332	)	$	58,206	$	(455	)
Non-Agency MBS	66,412		(765		)	12,225		(251		)	78,637		(1,016		)
U.S. Agency asset-backed securities	—		—			1,521		(23		)	1,521		(23		)
	$	90,042	$	(888	)	$	48,322	$	(606	)	$	138,364	$	(1,494	)

Held-to-maturity
U.S. Agency MBS	$	2,063	$	(5	)	$	—	$	—		$	2,063	$	(5	)
Obligations of state and political subdivisions	725		(2		)	—		—			725		(2		)
	$	2,788	$	(7	)	$	—	$	—		$	2,788	$	(7	)
2014
Available-for-sale
U.S. Agency MBS	$	15,807	$	(17	)	$	41,479	$	(879	)	$	57,286	$	(896	)
Non-Agency MBS	23,953		(220		)	6,411		(187		)	30,364		(407		)
U.S. Agency asset-backed securities	718		(6		)	1,582		(36		)	2,300		(42		)
	$	40,478	$	(243	)	$	49,472	$	(1,102	)	$	89,950	$	(1,345	)

Held-to-maturity
Obligations of state and political subdivisions	3,806		(18		)	—		—			3,806		(18		)
	$	3,806	$	(18	)	$	—	$	—		$	3,806	$	(18	)

The unrealized losses on investments in U.S. Agency and non-agency MBS and U.S. Agency asset-backed securities are primarily due to elevated yield/rate spreads at December 31, 2015 and 2014 as compared to yield/rate relationships prevailing at the time specific investment securities were purchased. Management expects the fair value of these investment securities to recover as market volatility lessens and/or as securities approach their maturity dates. Accordingly, management does not believe that the above gross unrealized losses on investment securities are other-than-temporary. No impairment adjustments have been recorded for the years ended December 31, 2015, 2014 and 2013.

Management intends to hold the investment securities classified as held-to-maturity until they mature, at which time the Company will receive full amortized cost value for such investment securities. Furthermore, as of December 31, 2015, management did not have the intent to sell any of the securities classified as available-for-sale in the table above and believes that it is more likely than not that the Company will not have to sell any such securities before a recovery of cost.

The amortized cost and estimated fair value of investment securities at December 31, 2015, by contractual maturity, are shown below (dollars in thousands). 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
	Amortized cost		Estimated fair value		Amortized cost		Estimated fair value
Due in one year or less	$	1,667	$	1,665	$	—	$	—
Due after one year through five years	22,899		22,904		29,868		30,188
Due after five years through ten years	48,731		48,536		88,925		91,070
Due after ten years	233,826		236,620		20,210		20,581
Mutual fund	525		537		—		—
Tax credit investments	—		—		421		421
	$	307,648	$	310,262	$	139,424	$	142,260

Investment securities with an estimated fair value of approximately $118.0 million and $187.3 million at December 31, 2015 and 2014, respectively, were pledged or in the process of being pledged, to secure various borrowings and for other purposes as required or permitted by law.

The Company sold $30.0 million, $63.5 million and $0.4 million of investment securities during the years ended December 31, 2015, 2014 and 2013, respectively.