| SECURITIES |
NOTE 2 – SECURITIES
The amortized cost and fair value of securities were as follows (dollars in thousands):
| |
|
Amortized
Cost
|
|
|
Gross
Unrealized
Gains
|
|
|
Gross
Unrealized
Losses
|
|
|
Fair
Value
|
|
December 31, 2018 |
|
|
|
|
|
|
|
|
|
|
|
|
Available for Sale: |
|
|
|
|
|
|
|
|
|
|
|
|
U.S. Treasury and federal agency securities |
|
$ |
97,102 |
|
|
$ |
6 |
|
|
$ |
(1,710 |
) |
|
$ |
95,398 |
|
U.S. Agency MBS and CMOs |
|
|
33,287 |
|
|
|
97 |
|
|
|
(494 |
) |
|
|
32,890 |
|
Tax-exempt state and municipal bonds |
|
|
45,212 |
|
|
|
246 |
|
|
|
(331 |
) |
|
|
45,127 |
|
Taxable state and municipal bonds |
|
|
46,565 |
|
|
|
59 |
|
|
|
(690 |
) |
|
|
45,934 |
|
Corporate bonds and other debt securities |
|
|
7,703 |
|
|
|
2 |
|
|
|
(68 |
) |
|
|
7,637 |
|
| |
|
$ |
229,869 |
|
|
$ |
410 |
|
|
$ |
(3,293 |
) |
|
$ |
226,986 |
|
Held to Maturity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax-exempt state and municipal bonds |
|
$ |
70,334 |
|
|
$ |
1,488 |
|
|
$ |
(317 |
) |
|
$ |
71,505 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2017 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available for Sale: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. Treasury and federal agency securities |
|
$ |
103,309 |
|
|
$ |
— |
|
|
$ |
(1,345 |
) |
|
$ |
101,964 |
|
U. S. Agency MBS and CMOs |
|
|
23,797 |
|
|
|
7 |
|
|
|
(419 |
) |
|
|
23,385 |
|
Tax-exempt state and municipal bonds |
|
|
41,684 |
|
|
|
519 |
|
|
|
(146 |
) |
|
|
42,057 |
|
Taxable state and municipal bonds |
|
|
44,267 |
|
|
|
10 |
|
|
|
(542 |
) |
|
|
43,735 |
|
Corporate bonds and other debt securities |
|
|
8,149 |
|
|
|
1 |
|
|
|
(41 |
) |
|
|
8,109 |
|
Other equity securities |
|
|
1,500 |
|
|
|
— |
|
|
|
(30 |
) |
|
|
1,470 |
|
| |
|
$ |
222,706 |
|
|
$ |
537 |
|
|
$ |
(2,523 |
) |
|
$ |
220,720 |
|
Held to Maturity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax-exempt state and municipal bonds |
|
$ |
85,827 |
|
|
$ |
806 |
|
|
$ |
(181 |
) |
|
$ |
86,452 |
|
There were no sales of securities available for sale during the year ended December 31, 2018. Proceeds from the sale of securities available for sale were $5.8 million for the year ended December 31, 2017, resulting in net gains on sale of $3,000 as reported in the consolidated statements of income. This resulted in reclassifications of $3,000 ($2,000 net of tax) from accumulated other comprehensive income to gain on sale of securities in the consolidated statements of income in the year ended December 31, 2017.
Contractual maturities of debt securities at December 31, 2018 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 |
|
$ |
8,337 |
|
|
$ |
8,363 |
|
|
$ |
24,685 |
|
|
$ |
24,549 |
|
Due from one to five years |
|
|
28,588 |
|
|
|
29,008 |
|
|
|
134,460 |
|
|
|
132,314 |
|
Due from five to ten years |
|
|
13,769 |
|
|
|
13,789 |
|
|
|
38,390 |
|
|
|
38,188 |
|
Due after ten years |
|
|
19,640 |
|
|
|
20,345 |
|
|
|
32,334 |
|
|
|
31,935 |
|
| |
|
$ |
70,334 |
|
|
$ |
71,505 |
|
|
$ |
229,869 |
|
|
$ |
226,986 |
|
Securities with unrealized losses at December 31, 2018 and 2017, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, are as follows (dollars in thousands):
| |
|
Less than 12 Months |
|
|
12 Months or More |
|
|
Total |
|
December 31, 2018 |
|
Fair
Value
|
|
|
Unrealized
Loss
|
|
|
Fair
Value
|
|
|
Unrealized
Loss
|
|
|
Fair
Value
|
|
|
Unrealized
Loss
|
|
Available for Sale: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. Treasury and federal agency securities |
|
$ |
1,974 |
|
|
$ |
(26 |
) |
|
$ |
82,895 |
|
|
$ |
(1,622 |
) |
|
$ |
84,869 |
|
|
$ |
(1,648 |
) |
U.S. Agency MBS and CMOs |
|
|
1,728 |
|
|
|
(13 |
) |
|
|
18,712 |
|
|
|
(481 |
) |
|
|
20,440 |
|
|
|
(494 |
) |
Tax-exempt state and municipal bonds |
|
|
8,987 |
|
|
|
(69 |
) |
|
|
10,785 |
|
|
|
(262 |
) |
|
|
19,772 |
|
|
|
(331 |
) |
Taxable state and municipal bonds |
|
|
4,035 |
|
|
|
(19 |
) |
|
|
37,021 |
|
|
|
(671 |
) |
|
|
41,056 |
|
|
|
(690 |
) |
Corporate bonds and other debt securities |
|
|
2,698 |
|
|
|
(12 |
) |
|
|
8,170 |
|
|
|
(118 |
) |
|
|
10,868 |
|
|
|
(130 |
) |
Total
|
|
$ |
19,422 |
|
|
$ |
(135 |
) |
|
$ |
157,583 |
|
|
$ |
(3,154 |
) |
|
$ |
177,005 |
|
|
$ |
(3,293 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Held to Maturity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax-exempt state and municipal bonds |
|
$ |
8,533
|
|
|
$
|
(76
|
)
|
|
$
|
4,683
|
|
|
$ |
(241
|
)
|
|
$ |
13,216
|
|
|
$ |
(317
|
)
|
| |
|
Less than 12 Months |
|
|
12 Months or More |
|
|
Total |
|
December 31, 2017 |
|
Fair
Value
|
|
|
Unrealized
Loss
|
|
|
Fair
Value
|
|
|
Unrealized
Loss
|
|
|
Fair
Value
|
|
|
Unrealized
Loss
|
|
Available for Sale: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. Treasury and federal agency securities |
|
$ |
50,614 |
|
|
$ |
(439 |
) |
|
$ |
43,787 |
|
|
$ |
(876 |
) |
|
$ |
94,401 |
|
|
$ |
(1,315 |
) |
U.S. Agency MBS and CMOs |
|
|
16,719 |
|
|
|
(249 |
) |
|
|
6,228 |
|
|
|
(170 |
) |
|
|
22,947 |
|
|
|
(419 |
) |
Tax-exempt state and municipal bonds |
|
|
27,576 |
|
|
|
(62 |
) |
|
|
4,208 |
|
|
|
(82 |
) |
|
|
11,784 |
|
|
|
(144 |
) |
Taxable state and municipal bonds |
|
|
30,331 |
|
|
|
(279 |
) |
|
|
9,781 |
|
|
|
(265 |
) |
|
|
40,112 |
|
|
|
(544 |
) |
Corporate bonds and other debt securities |
|
|
8,021 |
|
|
|
(42 |
) |
|
|
2,250 |
|
|
|
(29 |
) |
|
|
10,271 |
|
|
|
(71 |
) |
Other equity securities |
|
|
— |
|
|
|
— |
|
|
|
1,470 |
|
|
|
(30 |
) |
|
|
1,470 |
|
|
|
(30 |
) |
Total temporarily impaired |
|
$ |
|
|
|
$ |
|
) |
|
$ |
67,724 |
|
|
$ |
(1,452 |
) |
|
$ |
|
|
|
$ |
|
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Held to Maturity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax-exempt state and municipal bonds |
|
$ |
12,548
|
|
|
$ |
(181
|
)
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
12,548 |
|
|
$ |
(181
|
)
|
Other-Than-Temporary-Impairment
Management evaluates securities for OTTI at least on a quarterly basis, and more frequently when economic or market conditions warrant such an evaluation. At December 31, 2018, 250 securities available for sale with fair values totaling $177.0 million had unrealized losses totaling $3.3 million. At December 31, 2018, 27 securities held to maturity with fair values totaling $13.2 million had unrealized losses totaling $317,000. Management has the ability and intent to hold the securities classified as held to maturity until they mature, at which time the Company will receive full value for the securities. In addition, management believes it is more likely than not that the Company will not be required to sell any of its investment securities before a recovery of cost. 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 2018 and 2017.
Securities with a carrying value of approximately $2.0 million and $2.0 million were pledged as security for public deposits, letters of credit and for other purposes required or permitted by law at December 31, 2018 and 2017, respectively.
|