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SECURITIES | 12 Months Ended
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Dec. 31, 2020
SECURITIES |
SECURITIES | NOTE 3 – SECURITIES The carrying balances of the securities were as follows:
|  | December 31, |  | December 31,
|  | 2020 |  | 2019
|  | (dollars in thousands)
Debt securities available-for-sale |  | $ | 922,869 |  | $ | 592,404
Debt securities held-to-maturity |  |  | 68,395 |  |  | 88,477
Equity securities: |  |  |  |  |  |
Readily determinable fair value |  |  | 3,292 |  |  | 3,241
No readily determinable fair value |  |  | 1,552 |  |  | 1,148
Total securities |  | $ | 996,108 |  | $ | 685,270
Sales of securities were as follows during the years ended December 31:
|  | Year Ended December 31,
|  | 2020 |  | 2019 |  | 2018
|  | (dollars in thousands)
Proceeds from sales |  | $ | — |  |  | — |  | $ | 104,303
Gross realized gains |  |  | — |  |  | — |  |  | 281
Gross realized losses |  |  | — |  |  | — |  |  | (2,822)
Gains (losses) on securities were as follows during the years ended December 31:
|  | Year Ended December 31,
|  | 2020 |  | 2019 |  | 2018
|  | (dollars in thousands)
Net realized losses on sales |  | $ | — |  |  | — |  | $ | (2,541)
Net unrealized gains (losses) on equity securities: |  |  |  |  |  |  |  |  |
Readily determinable fair value |  |  | 33 |  |  | 160 |  |  | (122)
No readily determinable fair value |  |  | — |  |  | (165) |  |  | —
Gains (losses) on securities |  | $ | 33 |  |  | (5) |  | $ | (2,663)
The $165,000 unrealized loss on equity securities with no readily determinable fair value during the year ended December 31, 2019 reflects a downward adjustment based on observable price changes of an identical investment. Debt Securities The amortized cost and fair values of debt securities, with gross unrealized gains and losses, are as follows:
December 31, 2020 |  | Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value
Available-for-sale: |  | (dollars in thousands)
U.S. government agency |  | $ | 118,282 |  | $ | 3,720 |  | $ | (9) |  | $ | 121,993
Municipal |  |  | 265,309 |  |  | 9,232 |  |  | (280) |  |  | 274,261
Mortgage-backed: |  |  |  |  |  |  |  |  |  |  |  |
Agency residential |  |  | 198,543 |  |  | 4,871 |  |  | (162) |  |  | 203,252
Agency commercial |  |  | 246,649 |  |  | 4,651 |  |  | (534) |  |  | 250,766
Corporate |  |  | 70,917 |  |  | 1,786 |  |  | (106) |  |  | 72,597
Total available-for-sale |  |  | 899,700 |  |  | 24,260 |  |  | (1,091) |  |  | 922,869
Held-to-maturity: |  |  |  |  |  |  |  |  |  |  |  |
Municipal |  |  | 22,484 |  |  | 1,390 |  |  | — |  |  | 23,874
Mortgage-backed: |  |  |  |  |  |  |  |  |  |  |  |
Agency residential |  |  | 13,031 |  |  | 452 |  |  | — |  |  | 13,483
Agency commercial |  |  | 32,880 |  |  | 2,222 |  |  | (18) |  |  | 35,084
Total held-to-maturity |  |  | 68,395 |  |  | 4,064 |  |  | (18) |  |  | 72,441
Total debt securities |  | $ | 968,095 |  | $ | 28,324 |  | $ | (1,109) |  | $ | 995,310
December 31, 2019 |  | Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value
Available-for-sale: |  | (dollars in thousands)
U.S. government agency |  | $ | 49,113 |  | $ | 529 |  | $ | (27) |  | $ | 49,615
Municipal |  |  | 131,241 |  |  | 2,503 |  |  | (6) |  |  | 133,738
Mortgage-backed: |  |  |  |  |  |  |  |  |  |  |  |
Agency residential |  |  | 198,184 |  |  | 2,780 |  |  | (286) |  |  | 200,678
Agency commercial |  |  | 133,730 |  |  | 1,516 |  |  | (292) |  |  | 134,954
Corporate |  |  | 72,239 |  |  | 1,180 |  |  | — |  |  | 73,419
Total available-for-sale |  |  | 584,507 |  |  | 8,508 |  |  | (611) |  |  | 592,404
Held-to-maturity: |  |  |  |  |  |  |  |  |  |  |  |
Municipal |  |  | 45,239 |  |  | 1,340 |  |  | — |  |  | 46,579
Mortgage-backed: |  |  |  |  |  |  |  |  |  |  |  |
Agency residential |  |  | 19,072 |  |  | 161 |  |  | (170) |  |  | 19,063
Agency commercial |  |  | 24,166 |  |  | 775 |  |  | (54) |  |  | 24,887
Total held-to-maturity |  |  | 88,477 |  |  | 2,276 |  |  | (224) |  |  | 90,529
Total debt securities |  | $ | 672,984 |  | $ | 10,784 |  | $ | (835) |  | $ | 682,933
As of December 31, 2020 and 2019, the Bank had securities with a carrying value of $308,064,000 and $284,895,000, respectively, which were pledged to secure public and trust deposits, securities sold under agreements to repurchase, and for other purposes required or permitted by law. The Company has no direct exposure to the State of Illinois, but approximately 41% of the obligations of local municipalities portfolio consists of securities issued by municipalities located in Illinois as of December 31, 2020. Approximately 75% of such securities were general obligation issues as of December 31, 2020. The amortized cost and fair value of debt securities by contractual maturity, as of December 31, 2020, are shown below. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.
|  | Available-for-Sale |  | Held-to-Maturity
|  | Amortized Cost |  | Fair Value |  | Amortized Cost |  | Fair Value
|  | (dollars in thousands)
Due in 1 year or less |  | $ | 28,332 |  | $ | 28,626 |  | $ | 1,396 |  | $ | 1,424
Due after 1 year through 5 years |  |  | 82,778 |  |  | 85,859 |  |  | 13,895 |  |  | 14,806
Due after 5 years through 10 years |  |  | 210,971 |  |  | 218,710 |  |  | 6,302 |  |  | 6,723
Due after 10 years |  |  | 132,427 |  |  | 135,656 |  |  | 891 |  |  | 921
Mortgage-backed: |  |  |  |  |  |  |  |  |  |  |  |
Agency residential |  |  | 198,543 |  |  | 203,252 |  |  | 13,031 |  |  | 13,483
Agency commercial |  |  | 246,649 |  |  | 250,766 |  |  | 32,880 |  |  | 35,084
Total |  | $ | 899,700 |  | $ | 922,869 |  | $ | 68,395 |  | $ | 72,441
The following tables present gross unrealized losses and fair value of investments, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, as of December 31:
|  | Investments in a Continuous Unrealized Loss Position
|  | Less than 12 Months |  | 12 Months or More |  | Total
December 31, 2020 |  | Unrealized Loss |  | Fair Value |  | Unrealized Loss |  | Fair Value |  | Unrealized Loss |  | Fair Value
Available-for-sale: |  | (dollars in thousands)
U.S. government agency |  | $ | (9) |  | $ | 5,919 |  | $ | — |  | $ | — |  | $ | (9) |  | $ | 5,919
Municipal |  |  | (280) |  |  | 19,652 |  |  | — |  |  | — |  |  | (280) |  |  | 19,652
Mortgage-backed: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Agency residential |  |  | (142) |  |  | 20,387 |  |  | (20) |  |  | 4,490 |  |  | (162) |  |  | 24,877
Agency commercial |  |  | (524) |  |  | 57,126 |  |  | (10) |  |  | 3,449 |  |  | (534) |  |  | 60,575
Corporate |  |  | (106) |  |  | 4,849 |  |  | — |  |  | — |  |  | (106) |  |  | 4,849
Total available-for-sale |  |  | (1,061) |  |  | 107,933 |  |  | (30) |  |  | 7,939 |  |  | (1,091) |  |  | 115,872
Held-to-maturity: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Mortgage-backed: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Agency commercial |  |  | (18) |  |  | 2,983 |  |  | — |  |  | — |  |  | (18) |  |  | 2,983
Total held-to-maturity |  |  | (18) |  |  | 2,983 |  |  | — |  |  | — |  |  | (18) |  |  | 2,983
Total debt securities |  | $ | (1,079) |  | $ | 110,916 |  | $ | (30) |  | $ | 7,939 |  | $ | (1,109) |  | $ | 118,855
|  | Investments in a Continuous Unrealized Loss Position
|  | Less than 12 Months |  | 12 Months or More |  | Total
December 31, 2019 |  | Unrealized Loss |  | Fair Value |  | Unrealized Loss |  | Fair Value |  | Unrealized Loss |  | Fair Value
Available-for-sale: |  | (dollars in thousands)
U.S. government agency |  | $ | (26) |  | $ | 18,865 |  | $ | (1) |  | $ | 1,998 |  | $ | (27) |  | $ | 20,863
Municipal |  |  | (6) |  |  | 894 |  |  | — |  |  | — |  |  | (6) |  |  | 894
Mortgage-backed: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Agency residential |  |  | (108) |  |  | 25,563 |  |  | (178) |  |  | 27,296 |  |  | (286) |  |  | 52,859
Agency commercial |  |  | (100) |  |  | 20,056 |  |  | (192) |  |  | 15,704 |  |  | (292) |  |  | 35,760
Total available-for-sale |  |  | (240) |  |  | 65,378 |  |  | (371) |  |  | 44,998 |  |  | (611) |  |  | 110,376
Held-to-maturity: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Mortgage-backed: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Agency residential |  |  | (30) |  |  | 2,516 |  |  | (140) |  |  | 9,002 |  |  | (170) |  |  | 11,518
Agency commercial |  |  | (47) |  |  | 7,016 |  |  | (7) |  |  | 599 |  |  | (54) |  |  | 7,615
Total held-to-maturity |  |  | (77) |  |  | 9,532 |  |  | (147) |  |  | 9,601 |  |  | (224) |  |  | 19,133
Total debt securities |  | $ | (317) |  | $ | 74,910 |  | $ | (518) |  | $ | 54,599 |  | $ | (835) |  | $ | 129,509
As of December 31, 2020, there were 8 securities in an unrealized loss position for a period of twelve months or more, and 60 securities in an unrealized loss position for a period of less than twelve months. These unrealized losses are primarily a result of fluctuations in interest rates in the bond market. In analyzing an issuer’s financial condition, management considers whether the securities are issued by the federal government or its agencies, whether downgrades by bond rating agencies have occurred, and industry analysts’ reports. Management believes that all declines in value of these securities are deemed to be temporary. Equity Securities The Company has elected to measure equity securities with no readily determinable fair value at cost minus impairment, if any, plus or minus changes resulting from observable price changes for identical or similar securities of the same issuer. The initial cost and carrying values of equity securities, with cumulative net unrealized gains and losses, are as follows:
|  |  |  |  | Cumulative |  |  |
|  |  |  | Net Unrealized |  |
December 31, 2020 |  | Initial Cost |  | Gains (Losses) |  | Carrying Value
|  | (dollars in thousands)
Readily determinable fair value |  | $ | 3,098 |  | $ | 194 |  | $ | 3,292
No readily determinable fair value |  |  | 1,717 |  |  | (165) |  |  | 1,552
Total equity securities |  | $ | 4,815 |  | $ | 29 |  | $ | 4,844
|  |  |  |  | Cumulative |  |  |
|  |  |  | Net Unrealized |  |
December 31, 2019 |  | Initial Cost |  | Gains (Losses) |  | Carrying Value
|  | (dollars in thousands)
Readily determinable fair value |  | $ | 3,080 |  | $ | 161 |  | $ | 3,241
No readily determinable fair value |  |  | 1,313 |  |  | (165) |  |  | 1,148
Total equity securities |  | $ | 4,393 |  | $ | (4) |  | $ | 4,389
As of December 31, 2020 and 2019, the cumulative net unrealized losses on equity securities with no readily determinable fair value reflects downward adjustments based on observable price changes of an identical investment. There have been no impairments or upward adjustments based on observable price changes to equity securities with no readily determinable fair value.

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