| SECURITIES |
NOTE 2 – SECURITIES
The amortized cost and fair value of securities at period-end were as follows (dollars in thousands):
| |
|
Amortized
Cost
|
|
|
Gross
Unrealized
Gains
|
|
|
Gross
Unrealized
Losses
|
|
|
Fair
Value
|
|
September 30, 2016 |
|
|
|
|
|
|
|
|
|
|
|
|
Available for Sale: |
|
|
|
|
|
|
|
|
|
|
|
|
U.S. Treasury and federal agency securities |
|
$ |
85,734 |
|
|
$ |
496 |
|
|
$ |
(40 |
) |
|
$ |
86,190 |
|
U.S. Agency MBS and CMOs |
|
|
12,984 |
|
|
|
134 |
|
|
|
(6 |
) |
|
|
13,112 |
|
Tax-exempt state and municipal bonds |
|
|
36,592 |
|
|
|
1,113 |
|
|
|
(17 |
) |
|
|
37,688 |
|
Taxable state and municipal bonds |
|
|
32,117 |
|
|
|
446 |
|
|
|
(17 |
) |
|
|
32,546 |
|
Corporate bonds and other debt securities |
|
|
13,266 |
|
|
|
86 |
|
|
|
(3 |
) |
|
|
13,349 |
|
Other equity securities |
|
|
1,500 |
|
|
|
18 |
|
|
|
--- |
|
|
|
1,518 |
|
| |
|
$ |
182,193 |
|
|
$ |
2,293 |
|
|
$ |
(83 |
) |
|
$ |
184,403 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Held to Maturity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax-exempt state and municipal bonds |
|
$ |
58,893 |
|
|
$ |
1,480 |
|
|
$ |
--- |
|
|
$ |
60,373 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2015 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available for Sale: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. Treasury and federal agency securities |
|
$ |
74,618 |
|
|
$ |
48 |
|
|
$ |
(274 |
) |
|
$ |
74,392 |
|
U. S. Agency MBS and CMOs |
|
|
13,828 |
|
|
|
35 |
|
|
|
(108 |
) |
|
|
13,755 |
|
Tax-exempt state and municipal bonds |
|
|
32,943 |
|
|
|
692 |
|
|
|
(37 |
) |
|
|
33,598 |
|
Taxable state and municipal bonds |
|
|
28,554 |
|
|
|
246 |
|
|
|
(37 |
) |
|
|
28,763 |
|
Corporate bonds and other debt securities |
|
|
14,838 |
|
|
|
19 |
|
|
|
(44 |
) |
|
|
14,813 |
|
Other equity securities |
|
|
1,500 |
|
|
|
--- |
|
|
|
(6 |
) |
|
|
1,494 |
|
|
|
$ |
166,281 |
|
|
$ |
1,040 |
|
|
$ |
(506 |
) |
|
$ |
166,815 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Held to Maturity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax-exempt state and municipal bonds |
|
$ |
51,856 |
|
|
$ |
986 |
|
|
$ |
(5 |
) |
|
$ |
52,837 |
|
There were no sales of securities available for sale in the three month period ended September 30, 2016. Proceeds from the sale of securities available for sale were $9.6 million in the nine month period ended September 30, 2016 resulting in net gains on sale of $99,000 as reported in the Consolidated Statements of Income. This resulted in reclassifications of $99,000 ($64,000 net of tax) from accumulated other comprehensive income to gain on sale of securities in the Consolidated Statements of Income in the nine month period ended September 30, 2016. Proceeds from the sale of securities available for sale were $7.8 million in the three month period ended September 30, 2015 and $19.8 million in the nine month period ended September 30, 2015 resulting in net gains on sale of $36,000 and $119,000, respectively, as reported in the Consolidated Statements of Income. This resulted in reclassifications of $36,000 ($23,000 net of tax) and $119,000 ($77,000 net of tax) from accumulated other comprehensive income to gain on sale of securities in the Consolidated Statements of Income in the three and nine month periods ended September 30, 2015.
Contractual maturities of debt securities at September 30, 2016 were as follows (dollars in thousands):
| |
|
Held–to-Maturity Securities |
|
|
Available-for-Sale Securities |
|
| |
|
Amortized
Cost
|
|
|
Fair
Value
|
|
|
Amortized
Cost
|
|
|
Fair
Value
|
|
Due in one year or less |
|
$ |
22,529 |
|
|
$ |
22,538 |
|
|
$ |
13,448 |
|
|
$ |
13,513 |
|
Due from one to five years |
|
|
15,546 |
|
|
|
16,228 |
|
|
|
95,679 |
|
|
|
96,614 |
|
Due from five to ten years |
|
|
8,618 |
|
|
|
9,148 |
|
|
|
56,285 |
|
|
|
57,352 |
|
Due after ten years |
|
|
12,200 |
|
|
|
12,459 |
|
|
|
15,281 |
|
|
|
15,406 |
|
| |
|
$ |
58,893 |
|
|
$ |
60,373 |
|
|
$ |
180,693 |
|
|
$ |
182,885 |
|
Securities with unrealized losses at September 30, 2016 and December 31, 2015, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, were as follows (dollars in thousands):
| |
|
Less than 12 Months |
|
|
12 Months or More |
|
|
Total |
|
September 30, 2016 |
|
Fair
Value
|
|
|
Unrealized
Loss
|
|
|
Fair
Value
|
|
|
Unrealized
Loss
|
|
|
Fair
Value
|
|
|
Unrealized
Loss
|
|
U.S. Treasury and federal agency securities |
|
$ |
15,757 |
|
|
$ |
(38 |
) |
|
$ |
3,078 |
|
|
$ |
(2 |
) |
|
$ |
18,835 |
|
|
$ |
(40 |
) |
U.S. Agency MBS and CMOs |
|
|
1,355 |
|
|
|
(6 |
) |
|
|
--- |
|
|
|
--- |
|
|
|
1,355 |
|
|
|
(6 |
) |
Tax-exempt state and municipal bonds |
|
|
2,718 |
|
|
|
(17 |
) |
|
|
--- |
|
|
|
--- |
|
|
|
2,718 |
|
|
|
(17 |
) |
Taxable state and municipal bonds |
|
|
3,300 |
|
|
|
(17 |
) |
|
|
--- |
|
|
|
--- |
|
|
|
3,300 |
|
|
|
(17 |
) |
Corporate bonds and other debt securities |
|
|
1,527 |
|
|
|
(3 |
) |
|
|
--- |
|
|
|
--- |
|
|
|
1,527 |
|
|
|
(3 |
) |
Other equity securities |
|
|
--- |
|
|
|
--- |
|
|
|
--- |
|
|
|
--- |
|
|
|
--- |
|
|
|
--- |
|
Total temporarily impaired |
|
$ |
24,657 |
|
|
$ |
(81 |
) |
|
$ |
3,078 |
|
|
$ |
(2 |
) |
|
$ |
27,735 |
|
|
$ |
(83 |
) |
| |
|
Less than 12 Months |
|
|
12 Months or More |
|
|
Total |
|
December 31, 2015 |
|
Fair
Value
|
|
|
Unrealized
Loss
|
|
|
Fair
Value
|
|
|
Unrealized
Loss
|
|
|
Fair
Value
|
|
|
Unrealized
Loss
|
|
U.S. Treasury and federal agency securities |
|
$ |
35,090 |
|
|
$ |
(187 |
) |
|
$ |
7,036 |
|
|
$ |
(82 |
) |
|
$ |
42,126 |
|
|
$ |
(269 |
) |
U.S. Agency MBS and CMOs |
|
|
8,842 |
|
|
|
(108 |
) |
|
|
--- |
|
|
|
--- |
|
|
|
8,842 |
|
|
|
(108 |
) |
Tax-exempt state and municipal bonds |
|
|
3,487 |
|
|
|
(9 |
) |
|
|
2,022 |
|
|
|
(33 |
) |
|
|
5,509 |
|
|
|
(42 |
) |
Taxable state and municipal bonds |
|
|
8,158 |
|
|
|
(29 |
) |
|
|
640 |
|
|
|
(8 |
) |
|
|
8,798 |
|
|
|
(37 |
) |
Corporate bonds and other debt securities |
|
|
9,330 |
|
|
|
(47 |
) |
|
|
499 |
|
|
|
(2 |
) |
|
|
9,829 |
|
|
|
(49 |
) |
Other equity securities |
|
|
1,494 |
|
|
|
(6 |
) |
|
|
--- |
|
|
|
--- |
|
|
|
1,494 |
|
|
|
(6 |
) |
Total temporarily impaired |
|
$ |
66,401 |
|
|
$ |
(386 |
) |
|
$ |
10,197 |
|
|
$ |
(125 |
) |
|
$ |
76,598 |
|
|
$ |
(511 |
) |
Other-Than-Temporary-Impairment
Management evaluates securities for other-than-temporary impairment ("OTTI") at least on a quarterly basis, and more frequently when economic or market conditions warrant such an evaluation. Management determined that the unrealized losses for each period were attributable to changes in interest rates and not due to credit quality. As such, no OTTI charges were necessary during the three and nine month periods ended September 30, 2016 and 2015.
Securities with a carrying value of approximately $2.0 million were pledged as security for public deposits, letters of credit and for other purposes required or permitted by law at September 30, 2016 and December 31, 2015.
|