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Investments | 3 Months Ended
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Mar. 31, 2020
Investments [Abstract] |
Investments | Investments The aggregate carrying and approximate fair market values of investment securities follow (in thousands). Fair values are based on quoted market prices, where available. If quoted market prices are not available, fair values are based on quoted market prices of comparable financial instruments.
| March 31, 2020 |  |  |  | December 31, 2019 |  |  |
| Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value
Securities available-for-sale: |  |  |  |  |  |  |  |
U.S. Treasuries and U.S. |  |  |  |  |  |  |  |
government agencies | $ | 500 |  | $ | 2 |  | $ | — |  | $ | 502 |  | $ | 500 |  | $ | 2 |  | $ | — |  | $ | 502 |
Obligations of states and |  |  |  |  |  |  |  |
political subdivisions | 121,684 |  | 4,896 |  | 630 |  | 125,950 |  | 112,393 |  | 4,800 |  | 6 |  | 117,187 |
Mortgage-backed securities: |  |  |  |  |  |  |  |
U.S. government agencies | 718,679 |  | 41,318 |  | 532 |  | 759,465 |  | 631,637 |  | 12,292 |  | 1,825 |  | 642,104 |
Private label | 10,669 |  | 269 |  | 76 |  | 10,862 |  | 10,896 |  | 589 |  | — |  | 11,485 |
Trust preferred securities | 4,549 |  | — |  | 1,149 |  | 3,400 |  | 4,781 |  | 27 |  | 347 |  | 4,461 |
Corporate securities | 31,618 |  | 465 |  | 390 |  | 31,693 |  | 31,669 |  | 500 |  | 43 |  | 32,126 |
Total Debt Securities | 887,699 |  | 46,950 |  | 2,777 |  | 931,872 |  | 791,876 |  | 18,210 |  | 2,221 |  | 807,865 |
Certificates of deposit held for investment | 2,241 |  | — |  | — |  | 2,241 |  | 2,241 |  | — |  | — |  | 2,241 |
Total Securities Available-for-Sale | $ | 889,940 |  | $ | 46,950 |  | $ | 2,777 |  | $ | 934,113 |  | $ | 794,117 |  | $ | 18,210 |  | $ | 2,221 |  | $ | 810,106 |
Securities held-to-maturity: |  |  |  |  |  |  |  |
Mortgage-backed securities: |  |  |  |  |  |  |  |
U.S. government agencies | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | 49,036 |  | $ | 1,562 |  | $ | — |  | $ | 50,598 |
Total Securities Held-to-Maturity | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | 49,036 |  | $ | 1,562 |  | $ | — |  | $ | 50,598 |
Effective January 1, 2020, the Company reclassified its held-to-maturity securities as available-for-sale utilizing the transition guidance under ASU 2019-04, and the unrealized gains/losses on these investments will be recorded through Other Comprehensive Income. The Company's other investment securities include marketable and non-marketable equity securities. At March 31, 2020 and December 31, 2019, the Company held $10.2 million and $12.6 million, respectively, in marketable equity securities. Marketable equity securities mainly consist of investments made by the Company in equity positions of various community banks. Included within this portfolio are ownership positions in the following community bank holding companies: First National Corporation (FXNC) (4%) and Eagle Financial Services, Inc. (EFSI) (1.5%). Changes in the fair value of the marketable equity securities are recorded in Unrealized (losses) gains recognized on equity securities still held in the Consolidated Statements of Income. The Co mpany's non-marketable securities consist of securities with limited marketability, such as stock in the Federal Reserve Bank ("FRB") or the Federal Home Loan Bank ("FHLB"). At March 31, 2020 and December 31, 2019, the Company held $16.6 million and $15.9 million, respectively, in non-marketable equity securities. These securities are carried at cost due to the restrictions placed on their transferability. The Company's mortgage-backed U.S. government agency securities consist of both residential and commercial securities, all of which are guaranteed by Fannie Mae ("FNMA"), Freddie Mac ("FHLMC"), or Ginnie Mae ("GNMA"). At March 31, 2020 and December 31, 2019 there were no securities of any non-governmental issuer whose aggregate carrying value or estimated fair value exceeded 10% of shareholders' equity. Certain investment securities owned by the Company were in an unrealized loss position (i.e., amortized cost basis exceeded the estimated fair value of the securities) as of March 31, 2020 and December 31, 2019. The following table shows the gross unrealized losses and fair value of the Company’s investments aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position (in thousands):
| March 31, 2020 |  |  |  |  |
| Less Than Twelve Months |  | Twelve Months or Greater |  | Total |
| Estimated Fair Value | Unrealized Loss | Estimated Fair Value | Unrealized Loss | Estimated Fair Value | Unrealized Loss
Securities available-for-sale: |  |  |  |  |  |
Obligations of states and political subdivisions | $ | 17,990 |  | $ | 629 |  | $ | 320 |  | $ | 1 |  | $ | 18,310 |  | $ | 630 |
Mortgage-backed securities: |  |  |  |  |  |
U.S. Government agencies | 64,404 |  | 511 |  | 4,780 |  | 21 |  | 69,184 |  | 532 |
Private Label | 5,540 |  | 76 |  | — |  | — |  | 5,540 |  | 76 |
Trust preferred securities | — |  | — |  | 3,400 |  | 1,149 |  | 3,400 |  | 1,149 |
Corporate securities | 15,193 |  | 390 |  | — |  | — |  | 15,193 |  | 390 |
Total available-for-sale | $ | 103,127 |  | $ | 1,606 |  | $ | 8,500 |  | $ | 1,171 |  | $ | 111,627 |  | $ | 2,777 |
| December 31, 2019 |  |  |  |  |
| Less Than Twelve Months |  | Twelve Months or Greater |  | Total |
| Estimated Fair Value | Unrealized Loss | Estimated Fair Value | Unrealized Loss | Estimated Fair Value | Unrealized Loss
Securities available-for-sale: |  |  |  |  |  |
Obligations of states and political subdivisions | $ | 230 |  | $ | — |  | $ | 1,439 |  | $ | 6 |  | $ | 1,669 |  | $ | 6 |
Mortgage-backed securities: |  |  |  |  |  |
U.S. Government agencies | 123,289 |  | 1,247 |  | 34,746 |  | 578 |  | 158,035 |  | 1,825 |
Trust preferred securities | 4,200 |  | 347 |  | — |  | — |  | 4,200 |  | 347 |
Corporate securities | 11,248 |  | 43 |  | — |  | — |  | 11,248 |  | 43 |
Total available-for-sale | $ | 138,967 |  | $ | 1,637 |  | $ | 36,185 |  | $ | 584 |  | $ | 175,152 |  | $ | 2,221 |
There were no held-to-maturity securities in an unrealized loss position as of December 31, 2019. The Company incurred no credit-related investment impairment losses in either the three months ended March 31, 2020 or March 31, 2019. Declines in the fair value of available-for-sale securities below their cost that are deemed to be other-than-temporary would be reflected in earnings as realized losses. In estimating other-than-temporary impairment losses, management considers, among other things (i) the length of time and the extent to which the fair value has been less than cost; (ii) the financial condition, capital strength, and near-term (within 12 months) prospects of the issuer, including any specific events which may influence the operations of the issuer, such as changes in technology that may impair the earnings potential of the investment or the discontinuance of a segment of the business that may affect the future earnings potential; (iii) the historical volatility in the market value of the investment and/or the liquidity or illiquidity of the investment; (iv) adverse conditions specifically related to the security, an industry, or a geographic area; and (v) the intent to sell the investment security and if it’s more likely than not that the Company will not have to sell the security before recovery of its cost basis. In addition, management also employs a continuous monitoring process in regards to its marketable equity securities, specifically its portfolio of regional community bank holdings. Although the regional community bank stocks that are owned by the Company are publicly traded, the trading activity for these stocks is minimal, with trading volumes of less than 0.2% of each respective company being traded on a daily basis. As part of management’s review process for these securities, management reviews the financial condition of each respective regional community bank for any indications of financial weakness. As of March 31, 2020, management does not intend to sell any impaired security and it is not more than likely that it will be required to sell any impaired security before the recovery of its amortized cost basis. The unrealized losses on debt securities are primarily the result of interest rate changes, credit spread fluctuations on agency-issued mortgage-related securities, general financial market uncertainty and unprecedented market volatility. These conditions should not prohibit the Company from receiving its contractual principal and interest payments on its debt securities. The fair value is expected to recover as the securities approach their maturity date or repricing date. As of March 31, 2020, management believes the unrealized losses detailed in the table above are temporary and no additional impairment loss has been recognized in the Company’s consolidated income statement. Should the impairment of any of these securities become other-than-temporary, the cost basis of the investment will be reduced and the resulting loss will be recognized in net income in the period the other-than-temporary impairment is identified, while any noncredit loss will be recognized in other comprehensive income. The amortized cost and estimated fair value of debt securities at March 31, 2020, by contractual maturity, are shown in the following table (in thousands). Expected maturities will differ from contractual maturities because the issuers of the securities may have the right to prepay obligations without prepayment penalties. Mortgage-backed securities have been allocated to their respective maturity groupings based on their contractual maturity.
| Amortized Cost | Estimated Fair Value
Available-for-Sale Debt Securities |  |
Due in one year or less | $ | 2,091 |  | $ | 2,108 |
Due after one year through five years | 14,955 |  | 15,386 |
Due after five years through ten years | 235,144 |  | 248,975 |
Due after ten years | 635,509 |  | 665,403 |
Total | $ | 887,699 |  | $ | 931,872 |
Gross gains and gross losses recognized by the Company from investment security transactions are summarized in the table below (in thousands):
|  |  | Three months ended March 31, |
|  |  | 2020 | 2019
Gross realized gains on securities sold |  |  | $ | 134 |  | $ | 89 |
Gross realized losses on securities sold |  |  | (71) |  | (1) |
Net investment security (losses) gains |  |  | $ | 63 |  | $ | 88 |
Gross unrealized gains recognized on equity securities still held |  |  | $ | 24 |  | $ | 143 |
Gross unrealized losses recognized on equity securities still held |  |  | (2,426) |  | (68) |
Net unrealized (losses) gains recognized on equity securities still held |  |  | $ | (2,402) |  | $ | 75 |
During January 2020, the Company sold the entirety of its Visa Inc. Class B common shares (86,605) in a cash transaction which resulted in a pre-tax gain of $17.8 million. The carrying value of the Visa Class B shares on the Company's balance sheet was $0, as the Company had no historical cost basis in the shares. The carrying value of securities pledged to secure public deposits and for other purposes as required or permitted by law approximated $563 million and $508 million at March 31, 2020 and December 31, 2019, respectively.

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