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Note 2 - Securities | 9 Months Ended
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Sep. 30, 2021
Notes to Financial Statements |
Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block] | 2. SECURITIES The amortized cost and fair value of available for sale securities and the related pre-tax gross unrealized gains and losses recognized in accumulated other comprehensive income are as follows:
|  | Amortized Cost |  |  | Gross Unrealized Gains |  |  | Gross Unrealized Losses |  |  | Fair Value |
September 30, 2021 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Government agency debt obligations |  | $ | 368,990,000 |  |  | $ | 350,000 |  |  | $ | (4,954,000 | ) |  | $ | 364,386,000 |
Mortgage-backed securities |  |  | 39,299,000 |  |  |  | 698,000 |  |  |  | (544,000 | ) |  |  | 39,453,000 |
Municipal general obligation bonds |  |  | 130,681,000 |  |  |  | 4,207,000 |  |  |  | (278,000 | ) |  |  | 134,610,000 |
Municipal revenue bonds |  |  | 20,468,000 |  |  |  | 327,000 |  |  |  | (180,000 | ) |  |  | 20,615,000 |
Other investments |  |  | 500,000 |  |  |  | 0 |  |  |  | 0 |  |  |  | 500,000 |
|  | $ | 559,938,000 |  |  | $ | 5,582,000 |  |  | $ | (5,956,000 | ) |  | $ | 559,564,000 |
December 31, 2020 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Government agency debt obligations |  | $ | 242,522,000 |  |  | $ | 516,000 |  |  | $ | (897,000 | ) |  | $ | 242,141,000 |
Mortgage-backed securities |  |  | 23,869,000 |  |  |  | 1,021,000 |  |  |  | 0 |  |  |  | 24,890,000 |
Municipal general obligation bonds |  |  | 101,991,000 |  |  |  | 5,833,000 |  |  |  | 0 |  |  |  | 107,824,000 |
Municipal revenue bonds |  |  | 11,521,000 |  |  |  | 473,000 |  |  |  | (2,000 | ) |  |  | 11,992,000 |
Other investments |  |  | 500,000 |  |  |  | 0 |  |  |  | 0 |  |  |  | 500,000 |
|  | $ | 380,403,000 |  |  | $ | 7,843,000 |  |  | $ | (899,000 | ) |  | $ | 387,347,000 |
Securities with unrealized losses at September 30, 2021 and December 31, 2020, aggregated by investment category and length of time that individual securities have been in a continuous loss position, are as follows:
|  | Less than 12 Months |  |  | 12 Months or More |  |  | Total |
|  | Fair Value |  |  | Unrealized Loss |  |  | Fair Value |  |  | Unrealized Loss |  |  | Fair Value |  |  | Unrealized Loss |
September 30, 2021 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Government agency debt obligations |  | $ | 274,190,000 |  |  | $ | 3,974,000 |  |  | $ | 48,317,000 |  |  | $ | 980,000 |  |  | $ | 322,507,000 |  |  | $ | 4,954,000 |
Mortgage-backed securities |  |  | 23,578,000 |  |  |  | 544,000 |  |  |  | 23,000 |  |  |  | 0 |  |  |  | 23,601,000 |  |  |  | 544,000 |
Municipal general obligation bonds |  |  | 32,180,000 |  |  |  | 278,000 |  |  |  | 0 |  |  |  | 0 |  |  |  | 32,180,000 |  |  |  | 278,000 |
Municipal revenue bonds |  |  | 11,098,000 |  |  |  | 158,000 |  |  |  | 820,000 |  |  |  | 22,000 |  |  |  | 11,918,000 |  |  |  | 180,000 |
|  | $ | 341,046,000 |  |  | $ | 4,954,000 |  |  | $ | 49,160,000 |  |  | $ | 1,002,000 |  |  | $ | 390,206,000 |  |  | $ | 5,956,000 |
|  | Less than 12 Months |  |  | 12 Months or More |  |  | Total |
|  | Fair Value |  |  | Unrealized Loss |  |  | Fair Value |  |  | Unrealized Loss |  |  | Fair Value |  |  | Unrealized Loss |
December 31, 2020 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Government agency debt obligations |  | $ | 118,650,000 |  |  | $ | 897,000 |  |  | $ | 0 |  |  | $ | 0 |  |  | $ | 118,650,000 |  |  | $ | 897,000 |
Mortgage-backed securities |  |  | 0 |  |  |  | 0 |  |  |  | 0 |  |  |  | 0 |  |  |  | 0 |  |  |  | 0 |
Municipal general obligation bonds |  |  | 0 |  |  |  | 0 |  |  |  | 0 |  |  |  | 0 |  |  |  | 0 |  |  |  | 0 |
Municipal revenue bonds |  |  | 423,000 |  |  |  | 2,000 |  |  |  | 0 |  |  |  | 0 |  |  |  | 423,000 |  |  |  | 2,000 |
|  | $ | 119,073,000 |  |  | $ | 899,000 |  |  | $ | 0 |  |  | $ | 0 |  |  | $ | 119,073,000 |  |  | $ | 899,000 |
We evaluate securities for other-than-temporary impairment at least on a quarterly basis. Consideration is given to the length of time and the extent to which the fair value has been less than cost, the financial condition and near-term prospects of the issuer, and the intent and ability we have to retain our investment in the issuer for a period of time sufficient to allow for any anticipated recovery in fair value. For those securities whose fair value is less than their amortized cost basis, we also consider our intent to sell the security, whether it is more likely than not that we will be required to sell the security before recovery and if we do not expect to recover the entire amortized cost basis of the security. In analyzing an issuer’s financial condition, we may consider whether the securities are issued by the federal government or its agencies, whether downgrades by bond rating agencies have occurred and the results of reviews of the issuer’s financial condition. At September 30, 2021, 291 debt securities with fair values totaling $390 million had unrealized losses aggregating $6.0 million. After we considered whether the securities were issued by the federal government or its agencies and whether downgrades by bond rating agencies had occurred, we determined that the unrealized losses were due to changing interest rate environments. As we do not intend to sell our debt securities before recovery of their cost basis and we believe it is more likely than not that we will not be required to sell our debt securities before recovery of the cost basis, no unrealized losses are deemed to be other-than-temporary. The amortized cost and fair value of debt securities at September 30, 2021, by maturity, are shown in the following table. The contractual maturity is utilized for U.S. Government agency debt obligations and municipal bonds. 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. Securities not due at a single maturity date, primarily mortgage-backed securities, are shown separately. Weighted average yields are also reflected, with yields for municipal securities shown at their tax equivalent yield.
|  | Weighted Average Yield |  |  | Amortized Cost |  |  | Fair Value |
Due in 2021 |  |  | 2.25 | % |  | $ | 545,000 |  |  | $ | 547,000 |
Due in 2022 through 2026 |  |  | 1.01 |  |  |  | 187,220,000 |  |  |  | 188,005,000 |
Due in 2027 through 2031 |  |  | 1.56 |  |  |  | 266,478,000 |  |  |  | 265,719,000 |
Due in 2032 and beyond |  |  | 1.98 |  |  |  | 65,896,000 |  |  |  | 65,340,000 |
Mortgage-backed securities |  |  | 1.76 |  |  |  | 39,299,000 |  |  |  | 39,453,000 |
Other investments |  |  | 3.75 |  |  |  | 500,000 |  |  |  | 500,000 |
Total available for sale securities |  |  | 1.44 | % |  | $ | 559,938,000 |  |  | $ | 559,564,000 |
Securities issued by the State of Michigan and all its political subdivisions had a combined amortized cost of $148 million and $109 million at September 30, 2021 and December 31, 2020, respectively, with estimated market values of $153 million and $116 million, respectively. Securities issued by all other states and their political subdivisions had a combined amortized cost of $2.7 million and $4.1 million at September 30, 2021 and December 31, 2020, respectively, with estimated market values of $2.7 million and $4.2 million, respectively. Total securities of any other specific issuer, other than the U.S. Government and its agencies and the State of Michigan and all its political subdivisions, did not exceed 10% of shareholders’ equity. The carrying value of U.S. Government agency debt obligations that are pledged to secure repurchase agreements was $176 million and $118 million at September 30, 2021 and December 31, 2020, respectively. Investments in Federal Home Loan Bank stock are restricted and may only be resold or redeemed by the issuer.

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- Definition The entire disclosure for investments in certain debt and equity securities. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 320 -URI http://asc.fasb.org/subtopic&trid=2209399 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 946 -SubTopic 320 -URI http://asc.fasb.org/subtopic&trid=2324412 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -URI http://asc.fasb.org/topic&trid=2196928 Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 940 -SubTopic 320 -URI http://asc.fasb.org/subtopic&trid=2176304 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher SEC -Name Regulation S-K (SK) -Number 229 -Section 1403 -Paragraph (b) + Details
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