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SECURITIES

9 Months Ended

Sep. 30, 2023

SECURITIES

SECURITIES

NOTE 4 – SECURITIES

The following is a summary of available for sale securities:


					Gross			Gross
		Amortized			Unrealized			Unrealized			Estimated
		Cost			Gains			Losses			Fair Value
September 30, 2023
U.S. Treasury securities		$	49,659		$	—		$	(7,824)		$	41,835
Obligations of U.S. Government sponsored agencies			31,888			—			(4,108)			27,780
Obligations of states and political subdivisions			63,941			—			(9,820)			54,121
Mortgage-backed securities			38,692			—			(2,852)			35,840
Corporate notes			20,682			—			(1,944)			18,738
Certificates of deposit			740			—			(8)			732
Total available for sale securities		$	205,602		$	—		$	(26,556)		$	179,046

December 31, 2022
U.S. Treasury securities		$	149,614		$	—		$	(7,517)		$	142,097
Obligations of U.S. Government sponsored agencies			24,935			—			(3,186)			21,749
Obligations of states and political subdivisions			90,701			88			(7,603)			83,186
Mortgage-backed securities			38,701			—			(2,064)			36,637
Corporate notes			21,005			381			(1,392)			19,994
Certificates of deposit			1,004			—			(30)			974
Total available for sale securities		$	325,960		$	469		$	(21,792)		$	304,637

The following is a summary of held to maturity securities:


					Gross			Gross
		Amortized			Unrealized			Unrealized			Estimated
		Cost			Gains			Losses			Fair Value
September 30, 2023
U.S. Treasury securities		$	73,002		$	—		$	(2,264)		$	70,738
Obligations of states and political subdivisions			4,152			—			(2)			4,150
Total held to maturity securities		$	77,154		$	—		$	(2,266)		$	74,888

December 31, 2022
U.S. Treasury securities		$	39,902		$	115		$	(1,440)		$	38,577
Obligations of states and political subdivisions			5,195			—			(2)			5,193
Total held to maturity securities		$	45,097		$	115		$	(1,442)		$	43,770

The following table shows the fair value and gross unrealized losses of securities with unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position:


	Less Than 12 Months						Greater Than 12 Months						Total
																			Number
	Fair			Unrealized			Fair			Unrealized			Fair			Unrealized			of
	Value			Losses			Value			Losses			Value			Losses			Securities

September 30, 2023 - Available for Sale
U.S. Treasury securities	$	—		$	—		$	41,835		$	(7,824)		$	41,835		$	(7,824)		9
Obligations of U.S. Government sponsored agencies		8,622			(355)			19,158			(3,753)			27,780			(4,108)		27
Obligations of states and political subdivisions		16,359			(894)			37,762			(8,926)			54,121			(9,820)		83
Mortgage-backed securities		7,149			(310)			28,691			(2,542)			35,840			(2,852)		114
Corporate notes		4,850			(142)			12,268			(1,802)			17,118			(1,944)		9
Certificate of Deposits		—			—			732			(8)			732			(8)		3
Totals	$	36,980		$	(1,701)		$	140,446		$	(24,855)		$	177,426		$	(26,556)		245

September 30, 2023 - Held to Maturity
U.S. Treasury securities	$	36,117		$	(694)		$	34,621		$	(1,570)		$	70,738		$	(2,264)		51
Obligations of states and political subdivisions		—			—			218			(2)			218			(2)		1
Totals	$	36,117		$	(694)		$	34,839		$	(1,572)		$	70,956		$	(2,266)		52

December 31, 2022 - Available for Sale
U.S. Treasury securities	$	99,433		$	(559)		$	42,664		$	(6,958)		$	142,097		$	(7,517)		12
Obligations of U.S. Government sponsored agencies		6,735			(652)			15,014			(2,534)			21,749			(3,186)		16
Obligations of states and political subdivisions		50,839			(2,650)			15,933			(4,953)			66,772			(7,603)		103
Mortgage-backed securities		35,731			(1,993)			879			(71)			36,610			(2,064)		107
Corporate notes		9,701			(920)			3,080			(472)			12,781			(1,392)		8
Certificate of Deposits		974			(30)			—			—			974			(30)		4
Totals	$	203,413		$	(6,804)		$	77,570		$	(14,988)		$	280,983		$	(21,792)		250

December 31, 2022 - Held to Maturity
U.S. Treasury securities	$	29,464		$	(1,306)		$	4,868		$	(134)		$	34,332		$	(1,440)		15
Obligations of states and political subdivisions		417			(2)			—			—			417			(2)		2
Totals	$	29,881		$	(1,308)		$	4,868		$	(134)		$	34,749		$	(1,442)		17

As of September 30, 2023, no allowance for credit losses has been recognized on available for sale securities in an unrealized loss position as the Company does not believe any of the debt securities are credit impaired. This is based on the Company’s analysis of the risk characteristics, including credit ratings, and other qualitative factors related to these securities. The issuers of these securities continue to make timely principal and interest payments under the contractual terms of the securities. As of September 30, 2023, the Company did not intend to sell these securities and it was more likely than not that the Company would not be required to sell the debt securities before recovery of their amortized cost, which may be at maturity. The unrealized losses have occurred as a result of changes in interest rates, market spreads and market conditions subsequent to purchase, not credit deterioration.

Furthermore, based on its analysis the Company has determined that held to maturity securities have zero expected credit losses. U.S. Treasury securities have the full faith and credit backing of the United States Government and the amount of Obligations of states and political subdivisions in an unrealized loss position at September 30, 2023 are not material to the financial statements.

The following is a summary of amortized cost and estimated fair value of securities by contractual maturity as of September 30, 2023. Contractual maturities will differ from expected maturities for mortgage-backed securities because borrowers may have the right to call or prepay obligations without penalties.


		Available for Sale						Held to Maturity
		Amortized			Estimated			Amortized			Estimated
		Cost			Fair Value			Cost			Fair Value
Due in one year or less		$	6,704		$	6,548		$	15,819		$	15,594
Due after one year through 5 years			31,059			28,060			56,263			54,356
Due after 5 years through ten years			74,846			64,319			5,072			4,938
Due after 10 years			54,301			44,279			—			—
Subtotal			166,910			143,206			77,154			74,888
Mortgage-backed securities			38,692			35,840			—			—
Total		$	205,602		$	179,046		$	77,154		$	74,888

As of September 30, 2023 and December 31, 2022, the carrying values of securities pledged to secure public deposits, securities sold under repurchase agreements, and for other purposes required or permitted by law were approximately $148.4 million and $226.9 million, respectively.

Sales of securities available for sale produced $34.2 million in proceeds, $0.1 million in gross gains and $0.2 million in gross losses for the nine months ended September 30, 2023. There were no sales of securities during the nine months ended September 30, 2022.