Note 3 - Securities

The amortized cost and fair values of our AFS securities portfolio were as follows:


	September 30, 2018
	Amortized		Unrealized		Unrealized
	Cost		Gains		Losses		Fair Value
	(dollars in thousands)
U.S. Treasury securities	$	1,990	$	—	$	15	$	1,975
U.S. government agency notes		10,107		—		132		9,975
	$	12,097	$	—	$	147	$	11,950


	December 31, 2017
	Amortized		Unrealized		Unrealized
	Cost		Gains		Losses		Fair Value
	(dollars in thousands)
U.S. government agency notes	$	10,169	$	—	$	50	$	10,119
	$	10,169	$	—	$	50	$	10,119

The amortized cost and fair values of our held-to-maturity (“HTM”) securities portfolio were as follows:


	September 30, 2018
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value
	(dollars in thousands)
U.S. Treasury securities	$	3,991	$	14	$	2	$	4,003
U.S. government agency notes		12,993		10		133		12,870
Mortgage-backed securities		26,124		8		1,139		24,993
	$	43,108	$	32	$	1,274	$	41,866


	December 31, 2017
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value
	(dollars in thousands)
U.S. Treasury securities	$	4,994	$	68	$	6	$	5,056
U.S. government agency notes		19,004		81		99		18,986
Mortgage-backed securities		30,305		27		370		29,962
	$	54,303	$	176	$	475	$	54,004

Gross unrealized losses and fair value by length of time that the individual AFS securities have been in an unrealized loss position at the dates indicated are presented in the following tables:


	September 30, 2018
	Less than 12 months				12 months or more				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Losses		Value		Losses		Value		Losses
	(dollars in thousands)
U.S. Treasury securities	$	1,975	$	15	$	—	$	—	$	1,975	$	15
U.S. government agency notes		6,948		86		3,027		46		9,975		132
	$	8,923	$	101	$	3,027	$	46	$	11,950	$	147


	December 31, 2017
	Less than 12 months				12 months or more				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Losses		Value		Losses		Value		Losses
	(dollars in thousands)
U.S. government agency notes	$	10,119	$	50	$	—	$	—	$	10,119	$	50
	$	10,119	$	50	$	—	$	—	$	10,119	$	50

Gross unrealized losses and fair value by length of time that the individual HTM securities have been in an unrealized loss position at the dates indicated are presented in the following tables:


	September 30, 2018
	Less than 12 months				12 months or more				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Losses		Value		Losses		Value		Losses
	(dollars in thousands)
U.S. Treasury securities	$	—	$	—	$	998	$	2	$	998	$	2
U.S. government agency notes		2,978		15		7,911		118		10,889		133
Mortgage-backed securities		3,649		106		21,090		1,033		24,739		1,139
	$	6,627	$	121	$	29,999	$	1,153	$	36,626	$	1,274


	December 31, 2017
	Less than 12 months				12 months or more				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Losses		Value		Losses		Value		Losses
	(dollars in thousands)
U.S. Treasury securities	$	1,993	$	6	$	—	$	—	$	1,993	$	6
U.S. government agency notes		6,977		23		6,964		76		13,941		99
Mortgage-backed securities		20,993		217		7,046		153		28,039		370
	$	29,963	$	246	$	14,010	$	229	$	43,973	$	475

In the AFS securities portfolio, 8 U.S. government agency notes and 2 U.S. Treasury securities were in a loss position as of September 30, 2018. In the HTM securities portfolio, 11 U.S. government agency notes, one U.S. Treasury security, and 18 mortgage-backed securities were in a loss position as of September 30, 2018.

In the AFS securities portfolio, 8 U.S. government agency notes were in a loss position as of December 31, 2017. In the HTM securities portfolio, 14 U.S. government agency notes, one U.S. Treasury security, and 16 mortgage-backed securities were in a loss position as of December 31, 2017.

All of the securities that are currently in a gross unrealized loss position are so due to declines in fair values resulting from changes in interest rates or increased liquidity spreads since the time they were purchased. We have the intent and ability to hold these debt securities to maturity (including the AFS securities) and do not intend to sell, nor do we believe it will be more likely than not that we will be required to sell, any impaired securities prior to a recovery of amortized cost. We expect these securities will be repaid in full, with no losses realized. As such, management considers any impairment to be temporary.

Contractual maturities of debt securities at September 30, 2018 are shown below. Actual maturities may differ from contractual maturities because borrowers have the right to call or prepay obligations with or without call or prepayment penalties.


	AFS Securities				HTM Securities
	Amortized		Fair		Amortized		Fair
	Cost		Value		Cost		Value
	(dollars in thousands)
Due in one year or less	$	3,000	$	2,980	$	8,004	$	7,969
Due after one through five years		9,097		8,970		8,980		8,904
Mortgage-backed securities		—		—		26,124		24,993
	$	12,097	$	11,950	$	43,108	$	41,866

During both the three and nine months ended September 30, 2017, we recognized gross gains and losses on the sale of securities of $4,000 and $2,000, respectively. We did not sell any securities in 2018.

There were no securities pledged as collateral as of September 30, 2018 or December 31, 2017.