Securities

9 Months Ended

Sep. 30, 2020

Investments, Debt and Equity Securities [Abstract]

SECURITIES

Securities available for sale at September 30, 2020 and December 31, 2019 are as follows:


	September 30, 2020								December 31, 2019
	Amortized		Unrealized				Fair		Amortized		Unrealized				Fair
	Cost		Gains		Losses		Value		Cost		Gains		Losses		Value
U.S. Gov’t sponsored entities	$	162,450	$	7,358	$	(99)	$	169,709	$	124,189	$	2,924	$	(19)	$	127,094
State & political subdivisions	63,930		3,161		(139)		66,952		101,177		3,288		(102)		104,363
Residential & multi-family mortgage	296,689		9,967		(347)		306,309		273,404		4,117		(885)		276,636
Corporate notes & bonds	13,735		49		(382)		13,402		8,350		14		(282)		8,082
Pooled SBA	26,562		942		(1)		27,503		25,063		274		(163)		25,174
Other	1,020		0		(38)		982		1,020		0		(56)		964
Total	$	564,386	$	21,477	$	(1,006)	$	584,857	$	533,203	$	10,617	$	(1,507)	$	542,313

At September 30, 2020 and December 31, 2019, there were no holdings of securities of any one issuer, other than the U.S. Government sponsored entities, in an amount greater than 10% of shareholders’ equity. The Corporation’s residential and multi-family mortgage securities are issued by government sponsored entities.

Trading securities at September 30, 2020 and December 31, 2019 are as follows:


	September 30, 2020		December 31, 2019
Corporate equity securities	$	3,964	$	7,946
Mutual funds	1,060		807
Certificates of deposit	417		350
Corporate notes and bonds	672		655
U.S. Government sponsored entities	51		51
Total	$	6,164	$	9,809

Securities with unrealized losses at September 30, 2020 and December 31, 2019, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, are as follows:

September 30, 2020


	Less than 12 Months				12 Months or More				Total
Description of Securities	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
U.S. Gov’t sponsored entities	$	24,953	$	(99)	$	0	$	0	$	24,953	$	(99)
State & political subdivisions	2,664		(10)		684		(129)		3,348		(139)
Residential & multi-family mortgage	31,615		(323)		3,783		(24)		35,398		(347)
Corporate notes & bonds	271		(1)		4,528		(381)		4,799		(382)
Pooled SBA	179		(1)		0		0		179		(1)
Other	0		0		982		(38)		982		(38)
	$	59,682	$	(434)	$	9,977	$	(572)	$	69,659	$	(1,006)

December 31, 2019


	Less than 12 Months				12 Months or More				Total
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
U.S. Gov’t sponsored entities	$	7,040	$	(3)	$	14,989	$	(16)	$	22,029	$	(19)
State & political subdivisions	826		(5)		684		(97)		1,510		(102)
Residential & multi-family mortgage	41,841		(346)		32,555		(539)		74,396		(885)
Corporate notes & bonds	0		0		4,718		(282)		4,718		(282)
Pooled SBA	8,560		(80)		6,075		(83)		14,635		(163)
Other	0		0		964		(56)		964		(56)
	$	58,267	$	(434)	$	59,985	$	(1,073)	$	118,252	$	(1,507)

The Corporation evaluates securities for other-than-temporary impairment on a quarterly basis, or more frequently when economic or market conditions warrant such an evaluation.

At September 30, 2020 and December 31, 2019, management performed an assessment for possible other-than-temporary impairment of the Corporation’s debt securities, relying on information obtained from various sources, including publicly available financial data, ratings by external agencies, brokers and other sources. Based on the results of the assessment, management believes impairment of these debt securities at September 30, 2020 and December 31, 2019 to be temporary.

For the securities that comprise corporate notes and bonds and the securities that are issued by state and political subdivisions, management monitors publicly available financial information, such as filings with the Securities and Exchange Commission, in order to evaluate the securities for other-than-temporary impairment. For financial institution issuers, management monitors information from quarterly “call” report filings that are used to generate Uniform Bank Performance Reports. All other securities that were in an unrealized loss position at the balance sheet date were reviewed by management, and issuer-specific documents were reviewed as appropriate given the following considerations; the financial condition and near-term prospects of the issuer and whether downgrades by bond rating agencies have occurred, the length of time and extent to which fair value has been less than cost, and whether management does not have the intent to sell these securities and it is likely that it will not be required to sell the securities before their anticipated recovery.

As of September 30, 2020 and December 31, 2019, management concluded that the securities described in the previous paragraph were not other-than-temporarily impaired for the following reasons:

•There is no indication of any significant deterioration of the creditworthiness of the institutions that issued the securities.

•All contractual interest payments on the securities have been received as scheduled, and no information has come to management’s attention through the processes previously described which would lead to a conclusion that future contractual payments will not be timely received.

The Corporation does not intend to sell and it is not more likely than not that it will be required to sell the securities in an unrealized loss position before recovery of its amortized cost basis.

On September 30, 2020 and December 31, 2019, securities carried at $460,503 and $405,200, respectively, were pledged to secure public deposits and for other purposes as provided by law.

The following is a schedule of the contractual maturity of securities available for sale at September 30, 2020:


	Amortized Cost		Fair Value
1 year or less	$	52,808	$	53,170
1 year – 5 years	116,868		120,786
5 years – 10 years	62,300		67,633
After 10 years	8,139		8,474
	240,115		250,063
Residential & multi-family mortgage	296,689		306,309
Pooled SBA	26,562		27,503
Other	1,020		982
Total debt securities	$	564,386	$	584,857

Mortgage and asset backed securities and pooled SBA securities are not due at a single date; periodic payments are received based on the payment patterns of the underlying collateral.

Information pertaining to security sales on available for sale securities is as follows:


	Proceeds		Gross Gains		Gross Losses
Three months ended September 30, 2020	$	0	$	0	$	0
Three months ended September 30, 2019	$	0	$	0	$	0
Nine months ended September 30, 2020	$	57,185	$	2,257	$	67
Nine months ended September 30, 2019	$	11,403	$	152	$	4

The tax provision related to these net realized gains was zero and $460 for the three and nine months ended September 30, 2020, respectively, and zero and $31 during the three and nine months ended September 30, 2019, respectively.