4. Investment securities:

The amortized cost and fair value of investment securities aggregated by investment category at June 30, 2019 and December 31, 2018 are summarized as follows:


			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
June 30, 2019	Cost		Gains		Losses		Value
Available-for-sale:
U.S. Treasury securities	$	23,958	$	143	$	17	$	24,084
U.S. Government-sponsored enterprises		93,830		82		423		93,489
State and municipals:
Taxable		12,475		367				12,842
Tax-exempt		69,454		713		32		70,135
Residential Mortgage-backed securities:
U.S. Government agencies		10,669		135		20		10,784
U.S. Government-sponsored enterprises		40,901		776		92		41,585
Commercial Mortgage-backed securities:
U.S. Government-sponsored enterprises		8,601		145				8,746
Total	$	259,888	$	2,361	$	584	$	261,665
Held-to-maturity:
Tax-exempt state and municipals	$	6,854	$	151			$	7,005
Residential Mortgage-backed securities:
U.S. Government agencies		36						36
U.S. Government-sponsored enterprises		1,079		32	$	1		1,110
Total	$	7,969	$	183	$	1	$	8,151


			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
December 31, 2018	Cost		Gains		Losses		Value
Available-for-sale:
U.S. Treasury securities	$	25,948		9	$	365	$	25,592
U.S. Government-sponsored enterprises		94,999	$	2		2,183		92,818
State and municipals:
Taxable		13,544		309				13,853
Tax-exempt		86,361		338		745		85,954
Residential Mortgage-backed securities:
U.S. Government agencies		12,663		50		84		12,629
U.S. Government-sponsored enterprises		33,149		49		401		32,797
Commercial Mortgage-backed securities:
U.S. Government-sponsored enterprises		6,269				230		6,039
Total	$	272,933	$	757	$	4,008	$	269,682
Held-to-maturity:
Tax-exempt state and municipals	$	6,855	$	12	$	43	$	6,824
Residential Mortgage-backed securities:
U.S. Government agencies		42						42
U.S. Government-sponsored enterprises		1,464		55		5		1,514
Total	$	8,361	$	67	$	48	$	8,380

Equity Securities

Our equity securities portfolio consists of stock of two other financial institutions. At June 30, 2019 and December 31, 2018, we had $283 and $291 respectively, in equity securities recorded at fair value. At June 30, 2019, the fair value of our equity portfolio exceeded the cost basis by $6. The following is a summary of unrealized and realized gains and losses recognized in net income on equity securities during the three and six months ended June 30, 2019 (in thousands):



For the Three Months Ended June 30,		2019		2018
Net gains (losses) recognized during the period on equity securities	$	(9)	$	8
Less: Net gains and (losses) recognized during the period on equity securities sold during the period
Unrealized gains (losses) recognized during the reporting period on equity securities still held at the reporting date	$	(9)	$	8


For the Six Months Ended June 30,		2019		2018
Net gains (losses) recognized during the period on equity securities	$	(8)	$
Less: Net gains and (losses) recognized during the period on equity securities sold during the period
Unrealized gains (losses) recognized during the reporting period on equity securities still held at the reporting date	$	(8)	$

Restricted Investment In Stock

Restricted investment in stock includes FHLB with a carrying cost of $7,791 and $7,420 at June 30, 2019 and December 31, 2018, respectively and Atlantic Community Bankers Bank (“ACBB”) stock with a carrying cost of $42 and VISA Class B stock with a carry cost of $0 at June 30, 2019 and December 31, 2018, are included in other assets in the consolidated balance sheets. FHLB and ACBB stock was issued as a requirement to facilitate participation in borrowing and other banking services. The investment in FHLB stock may fluctuate, as it is based on the member banks’ use of FHLB’s services.

The Company owns 44,982 shares of Visa Class B stock, which was necessary to participate in Visa services in support of the Company’s credit card, debit card, and related payment programs (permissible activities under banking regulations) as a member institution. Following the resolution of Visa’s litigation, shares of Visa’s Class B stock will be converted to Visa Class A shares using a conversion factor (1.6298 as of June 30, 2019), which is periodically adjusted to reflect VISA’s ongoing litigation costs. There is a very limited market for this stock, as only current owners of Class B shares are permitted to transact in Class B stock. Due to the lack of orderly trades and public information of such trades, Visa Class B stock has no readily determinable fair value.

These restricted investments are carried at cost and evaluated for other-than-temporary impairment (“OTTI”) periodically. As of June 30, 2019, there was no OTTI associated with these investments.

The maturity distribution of the fair value, which is the net carrying amount, of the debt securities classified as available-for-sale at June 30, 2019, is summarized as follows:


	Fair
June 30, 2019	Value
Within one year	$	38,102
After one but within five years		133,582
After five but within ten years		10,729
After ten years		18,137
		200,550
Mortgage-backed securities		61,115
Total	$	261,665

The maturity distribution of the amortized cost and fair value, of debt securities classified as held-to-maturity at June 30, 2019, is summarized as follows:


	Amortized		Fair
June 30, 2019	Cost		Value
Within one year
After one but within five years
After five but within ten years
After ten years	$	6,854	$	7,005
		6,854		7,005
Mortgage-backed securities		1,115		1,146
Total	$	7,969	$	8,151

Securities with a carrying value of $144,991 and $161,647 at June 30, 2019 and December 31, 2018, respectively, were pledged to secure public deposits and certain other deposits as required or permitted by law.

Securities and short-term investment activities are conducted with a diverse group of government entities, corporations and state and local municipalities. The counterparty’s creditworthiness and type of collateral is evaluated on a case-by-case basis. At June 30, 2019 and December 31, 2018, there were no significant concentrations of credit risk from any one issuer, with the exception of U.S. Government agencies and sponsored enterprises, that exceeded 10.0 percent of stockholders’ equity.

The fair value and gross unrealized losses of investment securities with unrealized losses for which an OTTI has not been recognized at June 30, 2019 and December 31, 2018, aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position, are summarized as follows:


	Less Than 12 Months				12 Months or More				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
June 30, 2019	Value		Losses		Value		Losses		Value		Losses
U.S. Treasury securities	$		$		$	7,993	$	17	$	7,993	$	17
U.S. Government-sponsored enterprises						75,292		423		75,292		423
State and municipals:
Tax-exempt						14,499		32		14,499		32
Residential Mortgage-backed securities:
U.S. Government agencies						5,281		20		5,281		20
U.S. Government-sponsored enterprises						10,372		93		10,372		93
Commercial Mortgage-backed securities:
U.S. Government-sponsored enterprises										—		—
Total	$	—	$	—	$	113,437	$	585	$	113,437	$	585


	Less Than 12 Months				12 Months or More				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
December 31, 2018	Value		Losses		Value		Losses		Value		Losses
U.S. Treasury securities	$	1,995	$	2	$	19,671	$	363	$	21,666	$	365
U.S. Government-sponsored enterprises		2,037		1		89,729		2,182		91,766		2,183
State and municipals:
Tax-exempt		9,022		74		52,352		714		61,374		788
Residential Mortgage-backed securities:
U.S. Government agencies						7,800		84		7,800		84
U.S. Government-sponsored enterprises		12,851		55		13,881		351		26,732		406
Commercial Mortgage-backed securities:
U.S. Government-sponsored enterprises						6,039		230		6,039		230
Total	$	25,905	$	132	$	189,472	$	3,924	$	215,377	$	4,056

The Company had 73 investment securities, consisting of 20 tax-exempt state and municipal obligations, 3 U.S. Treasury securities, 28 U.S. Government-sponsored enterprise securities, and 22 mortgage-backed securities that were in unrealized loss positions at June 30, 2019. Of these securities, 3 U.S. Treasury securities, 28 U.S. Government-sponsored enterprise securities, 20 tax-exempt state and municipal obligations, and 20 mortgage-backed securities were in a continuous unrealized loss position for twelve months or more. Management does not consider the unrealized losses on the debt securities, as a result of changes in interest rates, to be OTTI based on historical evidence that indicates the cost of these securities is recoverable within a reasonable period of time in relation to normal cyclical changes in the market rates of interest. Moreover, because there has been no material change in the credit quality of the issuers or other events or circumstances that may cause a significant adverse impact on the fair value of these securities, and management does not intend to sell these securities and it is unlikely that the Company will be required to sell these securities before recovery of their amortized cost basis, which may be maturity, the Company does not consider the unrealized losses to be OTTI at June 30, 2019. There was no OTTI recognized for the three or six months ended June 30, 2019 and 2018.