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Securities Available For Sale

The following table shows the gross unrealized losses and fair value for the securities available for sale portfolio, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at September 30, 2016 and December 31, 2015.

	Less Than Twelve Months					Twelve Months or More						Total
(Dollars in thousands)	# of Investments		Fair Value	Unrealized Losses		# of Investments		Fair Value	Unrealized Losses			Fair Value	Unrealized Losses
September 30, 2016
Collateralized mortgage obligations:
Federal National Mortgage Association (FNMA)	1	$	168	(4	)	0	$	0	0		$	168	(4	)
Other	1		8	(1	)	0		0	0			8	(1	)
Other marketable securities:
U.S. Government and agency obigations	2		9,995	(5	)	0		0	0			9,995	(5	)
Municipal obligations	0		0	0		3		341	(2	)		341	(2	)
Corporate preferred stock	0		0	0		1		350	(350	)		350	(350	)
Total temporarily impaired securities	4	$	10,171	(10	)	4	$	691	(352	)	$	10,862	(362	)

	Less Than Twelve Months					Twelve Months or More						Total
(Dollars in thousands)	# of Investments		Fair Value	Unrealized Losses		# of Investments		Fair Value	Unrealized Losses			Fair Value	Unrealized Losses
December 31, 2015
Collateralized mortgage obligations:
FNMA	1	$	346	(1	)	0	$	0	0		$	346	(1	)
Other	2		34	(8	)	0		0	0			34	(8	)
Other marketable securities:
U.S. Government agency obligations	9		44,878	(129	)	0		0	0			44,878	(129	)
Municipal obligations	12		2,010	(7	)	0		0	0			2,010	(7	)
Corporate obligations	1		334	(6	)	0		0	0			334	(6	)
Corporate preferred stock	0		0	0		1		350	(350	)		350	(350	)
Total temporarily impaired securities	25	$	47,602	(151	)	1	$	350	(350	)	$	47,952	(501	)

We review our investment portfolio on a quarterly basis for indications of impairment. This review includes analyzing the length of time and the extent to which the fair value has been lower than the cost, the market liquidity for the investment, the financial condition and near-term prospects of the issuer, including any specific events which may influence the operations of the issuer, and our intent and ability to hold the investment for a period of time sufficient to recover the temporary loss.

The unrealized losses reported for corporate preferred stock over twelve months at September 30, 2016 relates to a single trust preferred security that was issued by the holding company of a small community bank. Typical of most trust preferred issuances, the issuer has the ability to defer interest payments for up to five years with interest payable on the deferred balance. In September 2014, the issuer paid all previously deferred interest that was due and all payments were current as of September 30, 2014. Since January 2015, the issuer has deferred its scheduled interest payment as allowed by the terms of the security agreement. The issuer’s subsidiary bank has incurred operating losses in the past due to increased provisions for loan losses but has generated a modest amount of net income over the past twelve months and continues to meet the regulatory requirements to be considered “well capitalized” based on its most recent regulatory filing. Based on a review of the issuer, it was determined that the trust preferred security was not other-than-temporarily impaired at September 30, 2016. The Company does not intend to sell the trust preferred security and has the intent and ability to hold it for a period of time sufficient to recover the temporary loss. Management believes that the Company will receive all principal and interest payments contractually due on the security and that the decrease in the market value is primarily due to a lack of liquidity in the market for trust preferred securities and the deferral of interest by the issuer. Management will continue to monitor the credit risk of the issuer and may be required to recognize other-than-temporary impairment charges on this security in future periods.

A summary of securities available for sale at September 30, 2016 and December 31, 2015 is as follows:

(Dollars in thousands)	Amortized cost		Gross unrealized gains		Gross unrealized losses			Fair value
September 30, 2016:
Mortgage-backed securities:
Federal Home Loan Mortgage Corporation (FHLMC)	$	400		14		0			414
FNMA		386		8		0			394
Collateralized mortgage obligations:
FNMA		466		14		(4	)		476
Other		22		1		(1	)		22
		1,274		37		(5	)		1,306
Other marketable securities:
U.S. Government agency obligations		74,979		122		(5	)		75,096
Municipal obligations		2,952		30		(2	)		2,980
Corporate debt		290		15		0			305
Corporate preferred stock		700		0		(350	)		350
Corporate equity		58		21		0			79
		78,979		188		(357	)		78,810
	$	80,253		225		(362	)		80,116

(Dollars in thousands)	Amortized cost		Gross unrealized gains		Gross unrealized losses			Fair value
December 31, 2015
Mortgage-backed securities:
FHLMC	$	728		31		0			759
FNMA		725		22		0			747
Collateralized mortgage obligations:
FNMA		742		2		(1	)		743
Other		42		0		(8	)		34
		2,237		55		(9	)		2,283
Other marketable securities:
U.S. Government agency obligations		105,003		68		(129	)		104,942
Municipal obligations		3,991		18		(7	)		4,002
Corporate obligations		340		0		(6	)		334
Corporate preferred stock		700		0		(350	)		350
Corporate equity		58		5		0			63
		110,092		91		(492	)		109,691
	$	112,329		146		(501	)		111,974

The following table indicates amortized cost and estimated fair value of securities available for sale at September 30, 2016 based upon contractual maturity adjusted for scheduled repayments of principal and projected prepayments of principal based upon current economic conditions and interest rates.

(Dollars in thousands)	Amortized Cost		Fair Value
Due less than one year	$	70,655		70,779
Due after one year through five years		8,434		8,495
Due after five years through ten years		290		295
Due after ten years		816		468
No stated maturity		58		79
Total	$	80,253		80,116

The allocation of mortgage-backed securities in the table above is based upon the anticipated future cash flow of the securities using estimated mortgage prepayment speeds. The allocation of other marketable securities that have call features is based on the anticipated cash flows to the call date if it is anticipated that the security will be called, or to the maturity date if it is not anticipated to be called.