3. Investment securities:

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


			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
December 31, 2019	Cost		Gains		Losses		Value
Available-for-sale:
U.S. Treasury securities	$	23,966	$	162			$	24,128
U.S. government-sponsored enterprises		87,156		181	$	227		87,110
State and municipals:
Taxable		35,418		295		815		34,898
Tax-exempt		59,127		1,056		20		60,163
Residential mortgage-backed securities:
U.S. government agencies		8,368		112		10		8,470
U.S. government-sponsored enterprises		101,914		1,011		77		102,848
Commercial mortgage-backed securities:
U.S. government-sponsored enterprises		12,694		171		4		12,861
Total	$	328,643	$	2,988	$	1,153	$	330,478
Held-to-maturity:
Tax-exempt state and municipals	$	6,852	$	208			$	7,060
Residential mortgage-backed securities:
U.S. government agencies		31						31
U.S. government-sponsored enterprises		773		25	$			798
Total	$	7,656	$	233	$		$	7,889


			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

The Company had net unrealized gains on available-for-sale securities of $1,450, net of deferred income taxes of $385 at December 31, 2019, and net unrealized losses on available-for-sale securities of $2,568, net of deferred income taxes of $683, at December 31, 2018. During 2019, the Company sold available-for-sale municipal bonds and received proceeds totaling $9,677. Gross gains of $66 and gross losses of $43 were realized on the sale of investment securities in 2019. There were no sales of investment securities in 2018.

Our equity securities portfolio consists of stock of two other financial institutions. At December 31, 2019 and December 31, 2018, we had $423 thousand and $291 thousand, respectively, in equity securities recorded at fair value. Prior to January 1, 2018, equity securities were stated at fair value with unrealized gains and losses reported as a separate component of Accumulated Other Comprehensive Income (“AOCI”), net of tax. At December 31, 2018, net unrealized gains of $3 thousand had been recognized in AOCI. On January 1, 2018, these unrealized gains, net of income tax were reclassified out of AOCI and into retained earnings with subsequent changes in fair value being recognized in net income. At December 31, 2019, the fair value of our equity portfolio exceeded the cost basis by $146 thousand. The following is a summary of unrealized and realized gains and losses recognized in net income on equity securities during 2019 and 2018.

The maturity distribution of the fair value, which is the net carrying amount, of the debt securities classified as available-for-sale at December 31, 2019, is summarized as follows:


	Fair
December 31, 2019	Value
Within one year	$	41,486
After one but within five years		108,231
After five but within ten years		19,951
After ten years		33,297
		202,965
Mortgage-backed and other amortizing securities		127,513
Total	$	330,478

Expected maturities will differ from contractual maturities because borrowers have the right to call or prepay obligations with or without call or prepayment penalties.

The maturity distribution of the amortized cost and fair value, of debt securities classified as held-to-maturity at December 31, 2019, is summarized as follows:


	Amortized		Fair
December 31, 2019	Cost		Value
Within one year
After one but within five years
After five but within ten years
After ten years	$	6,852	$	7,060
		6,852		7,060
Mortgage-backed securities		804		829
Total	$	7,656	$	7,889

Securities with a carrying value of $157,047 and $161,647 at December 31, 2019 and 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 December 31, 2019 and 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 December 31, 2019 and 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
December 31, 2019	Value		Losses		Value		Losses		Value		Losses
U.S. government-sponsored enterprises	$	13,695	$	149	$	36,070	$	78	$	49,765	$	227
State and municipals:
Taxable		23,929		815						23,929		815
Tax-exempt		2,684		19		1,098		1		3,782		20
Residential mortgage-backed securities:
U.S. government agencies		992		1		2,362		9		3,354		10
U.S. government-sponsored enterprises		36,939		51		3,751		30		40,690		81
Total	$	78,239	$	1,035	$	43,281	$	118	$	121,520	$	1,153


	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 70 investment securities, consisting of 6 tax-exempt and 22 taxable state and municipal obligations, 18 U.S. government-sponsored enterprise securities and 24 mortgage-backed securities that were in unrealized loss positions at December 31, 2019. Of these securities, 16 U.S. government–sponsored enterprise securities, 17 mortgage-backed securities and 2 tax-exempt state and municipal 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 December 31, 2019.

There was no OTTI recognized for each of the years in the three-year period ended December 31, 2019.

Other assets include the Company’s investment in Visa Class B stock. The Company’s ownership includes shares acquired at no cost related to the Company’s prior ownership in Visa's network while Visa operated as a cooperative. The Company holds 44,982 shares of Visa Class B stock which, following resolution of Visa litigation, will be converted to Visa Class A shares (the conversion rate as of December 31, 2019 is 1.6228 shares of Class A stock for each share of Class B stock) for a total of 72,997 shares of Visa Class A stock.

There is a very limited market for this stock, as only current owners of Class B shares are permitted to transact in Class B. Due to the lack of orderly trades and public information of such trades, Visa Class B stock has no readily determinable fair value and is carried at cost.

Year Ended December 31,

Net gains recognized during the period on equity securities

Less: Net gains recognized during the period on equity securities sold during the period

Unrealized gains recognized during the reporting period on equity securities still held at the reporting date