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Securities Available for Sale | 12 Months Ended
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Dec. 31, 2022
Investments, Debt and Equity Securities [Abstract] |
Securities Available for Sale | NOTE 3 – SECURITIES AVAILABLE FOR SALE The following table summarizes the amortized cost and fair value of the available-for-sale securities portfolio at December 31, 2022 and 2021 and the corresponding amounts of gross unrealized gains and losses recognized in accumulated other comprehensive income (loss):
|  |  |  |  |  | Gross |  |  | Gross |  |  |  |
|  |  | Amortized |  |  | Unrealized |  |  | Unrealized |  |  |  |
| 2022 |  |  | Cost |  |  | Gains |  |  | Losses |  |  | Fair Value |
U.S. Treasury and U.S. government sponsored entities |  |  | $ | 149,712 |  |  | $ | 0 |  |  | $ | (21,616 | ) |  | $ | 128,096 |
State and political subdivisions |  |  |  | 651,705 |  |  |  | 266 |  |  |  | (121,891 | ) |  |  | 530,080 |
Corporate bonds |  |  |  | 4,181 |  |  |  | 0 |  |  |  | (302 | ) |  |  | 3,879 |
Mortgage-backed securities - residential |  |  |  | 672,784 |  |  |  | 12 |  |  |  | (117,654 | ) |  |  | 555,142 |
Collateralized mortgage obligations |  |  |  | 52,291 |  |  |  | 0 |  |  |  | (4,937 | ) |  |  | 47,354 |
Small Business Administration |  |  |  | 3,839 |  |  |  | 0 |  |  |  | (365 | ) |  |  | 3,474 |
Totals |  |  | $ | 1,534,512 |  |  | $ | 278 |  |  | $ | (266,765 | ) |  | $ | 1,268,025 |
|  |  |  |  |  | Gross |  |  | Gross |  |  |  |
|  |  | Amortized |  |  | Unrealized |  |  | Unrealized |  |  |  |
| 2021 |  |  | Cost |  |  | Gains |  |  | Losses |  |  | Fair Value |
U.S. Treasury and U.S. government sponsored entities |  |  | $ | 93,137 |  |  | $ | 32 |  |  | $ | (2,338 | ) |  | $ | 90,831 |
State and political subdivisions |  |  |  | 636,724 |  |  |  | 23,296 |  |  |  | (1,205 | ) |  |  | 658,815 |
Corporate bonds |  |  |  | 4,009 |  |  |  | 50 |  |  |  | (29 | ) |  |  | 4,030 |
Mortgage-backed securities - residential |  |  |  | 663,405 |  |  |  | 1,875 |  |  |  | (10,094 | ) |  |  | 655,186 |
Collateralized mortgage obligations |  |  |  | 13,303 |  |  |  | 153 |  |  |  | (71 | ) |  |  | 13,385 |
Small Business Administration |  |  |  | 5,381 |  |  |  | 49 |  |  |  | 0 |  |  |  | 5,430 |
Totals |  |  | $ | 1,415,959 |  |  | $ | 25,455 |  |  | $ | (13,737 | ) |  | $ | 1,427,677 |
The proceeds from sales of available-for-sale securities and the associated gains and losses were as follows:
|  |  |  |  | 2022 |  |  |  | 2021 |  |  |  | 2020 |
Proceeds |  | $ | 37,190 |  |  | $ | 35,175 |  |  | $ | 60,341 |
Gross gains |  |  | 6 |  |  |  | 863 |  |  |  | 394 |
Gross losses |  |  | (421 | ) |  |  | (25 | ) |  |  | (824 | )
The tax provision (benefit) related to these net realized gains (losses) was $(87) thousand, $176 thousand, and $(90) thousand respectively. The amortized cost and fair value of the debt securities portfolio are shown by expected maturity. Expected maturities may differ from contractual maturities if issuers have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately.
Available for sale |  |  |  |  |  | December 31, 2022 |
|  |  |  |  |  | Amortized |  |  |  |
Maturity |  | Cost |  |  | Fair Value |
Within one year |  | $ | 325 |  |  | $ | 321 |
One to five years |  |  | 27,624 |  |  |  | 25,346 |
Five to ten years |  |  | 156,929 |  |  |  | 135,626 |
Beyond ten years |  |  | 620,720 |  |  |  | 500,762 |
Mortgage-backed Securities, Collateralized Mortgage Obligations and Small Business Administration |  |  | 728,914 |  |  |  | 605,970 |
Totals |  | $ | 1,534,512 |  |  | $ | 1,268,025 |
Securities with a carrying amount of $479 million at December 31, 2022 and $491 million at December 31, 2021 were pledged to secure public deposits and repurchase agreements. Farmers Trust had securities, with a carrying amount of $100 thousand, at year-end 2022 and $102 thousand at year-end 2021, pledged to qualify as a fiduciary in the State of Ohio. In each year, there were no holdings of any issuer that exceeded 10% of stockholders’ equity, except for the U.S. Government, its agencies and its sponsored entities, which are fully insured. The following table summarizes the investment securities with unrealized losses at December 31, 2022 and 2021 aggregated by major security type and length of time in a continuous unrealized loss position.
2022 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Less than 12 Months |  |  | 12 Months or More |  |  | Total |
|  | Fair |  |  | Unrealized |  |  | Fair |  |  | Unrealized |  |  | Fair |  |  | Unrealized |
Description of Securities |  | Value |  |  | Loss |  |  | Value |  |  | Loss |  |  | Value |  |  | Loss |
U.S. Treasury and U.S. government |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
sponsored entities |  | $ | 52,311 |  |  | $ | (5,835 | ) |  | $ | 75,685 |  |  | $ | (15,781 | ) |  | $ | 127,996 |  |  | $ | (21,616 | )
State and political subdivisions |  |  | 306,709 |  |  |  | (56,650 | ) |  |  | 191,584 |  |  |  | (65,241 | ) |  |  | 498,293 |  |  |  | (121,891 | )
Corporate bonds |  |  | 2,893 |  |  |  | (122 | ) |  |  | 986 |  |  |  | (180 | ) |  |  | 3,879 |  |  |  | (302 | )
Mortgage-backed securities - residential |  |  | 101,476 |  |  |  | (13,545 | ) |  |  | 453,233 |  |  |  | (104,109 | ) |  |  | 554,709 |  |  |  | (117,654 | )
Collateralized mortgage obligations |  |  | 42,140 |  |  |  | (4,137 | ) |  |  | 5,214 |  |  |  | (800 | ) |  |  | 47,354 |  |  |  | (4,937 | )
Small Business Administration |  |  | 1,295 |  |  |  | (122 | ) |  |  | 2,179 |  |  |  | (243 | ) |  |  | 3,474 |  |  |  | (365 | )
Total temporarily impaired |  | $ | 506,824 |  |  | $ | (80,411 | ) |  | $ | 728,881 |  |  | $ | (186,354 | ) |  | $ | 1,235,705 |  |  | $ | (266,765 | )
2021 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Less than 12 Months |  |  | 12 Months or More |  |  | Total |
|  | Fair |  |  | Unrealized |  |  | Fair |  |  | Unrealized |  |  | Fair |  |  | Unrealized |
Description of Securities |  | Value |  |  | Loss |  |  | Value |  |  | Loss |  |  | Value |  |  | Loss |
U.S. Treasury and U.S. government |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
sponsored entities |  | $ | 81,236 |  |  | $ | (1,960 | ) |  | $ | 8,271 |  |  | $ | (378 | ) |  | $ | 89,507 |  |  | $ | (2,338 | )
State and political subdivisions |  |  | 103,651 |  |  |  | (1,020 | ) |  |  | 10,020 |  |  |  | (185 | ) |  |  | 113,671 |  |  |  | (1,205 | )
Corporate bonds |  |  | 418 |  |  |  | (2 | ) |  |  | 715 |  |  |  | (27 | ) |  |  | 1,133 |  |  |  | (29 | )
Mortgage-backed securities - residential |  |  | 525,792 |  |  |  | (7,872 | ) |  |  | 55,569 |  |  |  | (2,222 | ) |  |  | 581,361 |  |  |  | (10,094 | )
Collateralized mortgage obligations |  |  | 7,270 |  |  |  | (71 | ) |  |  | 0 |  |  |  | 0 |  |  |  | 7,270 |  |  |  | (71 | )
Total temporarily impaired |  | $ | 718,367 |  |  | $ | (10,925 | ) |  | $ | 74,575 |  |  | $ | (2,812 | ) |  | $ | 792,942 |  |  | $ | (13,737 | )
The Company has adopted ASU 2016-13 that makes improvements to the accounting for credit losses on securities available for sale. The concept of other than-temporarily impaired securities has been replaced with the allowance for credit losses. Securities available for sale are evaluated on an individual level and pooling of securities is no longer an option. During this evaluation process, management considers 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 of the Company to hold the security for a period of time sufficient to allow for any anticipated recovery in fair value. If the Company determines that a credit loss exists, the credit portion of the allowance will be measured using a discounted cash flow analysis using the effective interest rate as of the security’s purchase date. As of December 31, 2022, the Company’s security portfolio consisted of 847 securities, 803 of which were in an unrealized loss position. The majority of unrealized losses on the Company’s securities are related to its holdings of mortgage-backed securities and state and political subdivisions. The Company does not consider its available for sale ("AFS") securities with unrealized losses to be attributable to credit-related factors, as the unrealized losses have occurred as a result of changes in noncredit related factors such as changes in interest rates, market spreads and market conditions subsequent to purchase, not credit deterioration. In addtion, management has both the ability and intent to hold the securities for a period of time sufficient to allow for the recovery in fair value. As of December 31, 2022 the Company has no t recorded an allowance for credit losses on AFS securities. Equity Securities The Company also holds equity securities which include $15.0 million in Small Business Investment Company (“SBIC”) partnership investments as well as $196 thousand in local and regional bank holdings and other miscellaneous equity funds at December 31, 2022. At December 31, 2021 the Company held $14.7 million in SBIC investments and $228 thousand in local and regional bank holdings and other miscellaneous equity funds. Gains were recognized in income in 2022 and 2021 in compliance with ASU 2016-01, which requires all equity securities to be measured at their fair value with changes in fair value being recognized through the statements of income.

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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 https://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 https://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 https://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 https://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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