XML 20 R11.htm IDEA: XBRL DOCUMENT
v3.20.1

Investment securities | 3 Months Ended
--- | ---
Mar. 31, 2020
Investment securities |
Investment securities | 4. Investment securities: The amortized cost and fair value of investment securities aggregated by investment category at March 31, 2020 and December 31, 2019 are summarized as follows:
|  |  |  |  | Gross |  | Gross |  |  |  |
|  | Amortized |  | Unrealized |  | Unrealized |  | Fair |
March 31, 2020 |  | Cost |  | Gains |  | Losses |  | Value |
Available-for-sale: |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury securities |  | $ | 21,471 |  | $ | 650 |  |  |  |  | $ | 22,121 |
U.S. government-sponsored enterprises |  |  | 83,028 |  |  | 1,562 |  |  |  |  |  | 84,590 |
State and municipals: |  |  |  |  |  |  |  |  |  |  |  |  |
Taxable |  |  | 32,116 |  |  | 772 |  | $ | 328 |  |  | 32,560 |
Tax-exempt |  |  | 38,392 |  |  | 1,596 |  |  | 8 |  |  | 39,980 |
Residential mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. government agencies |  |  | 7,125 |  |  | 178 |  |  | 3 |  |  | 7,300 |
U.S. government-sponsored enterprises |  |  | 98,880 |  |  | 4,143 |  |  | 3 |  |  | 103,020 |
Commercial mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. government-sponsored enterprises |  |  | 12,675 |  |  | 638 |  |  |  |  |  | 13,313 |
Total |  | $ | 293,687 |  | $ | 9,539 |  | $ | 342 |  | $ | 302,884 |
Held-to-maturity: |  |  |  |  |  |  |  |  |  |  |  |  |
Tax-exempt state and municipals |  | $ | 6,851 |  | $ | 153 |  | $ | 15 |  | $ | 6,989 |
Residential mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. government agencies |  |  | 28 |  |  |  |  |  |  |  |  | 28 |
U.S. government-sponsored enterprises |  |  | 641 |  |  | 30 |  |  | 1 |  |  | 670 |
Total |  | $ | 7,520 |  | $ | 183 |  | $ | 16 |  | $ | 7,687 |
|  |  |  |  | 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 |
Equity Securities Our equity securities portfolio consists of stock of two other financial institutions. At March 31, 2020 and December 31, 2019, we had $299 and $423 respectively, in equity securities recorded at fair value. At March 31, 2020, the fair value of our equity portfolio exceeded the cost basis by $22. The following is a summary of unrealized and realized gains and losses recognized in net income on equity securities during the three months ended March 31 2020 (in thousands):
For the Three Months Ended March 31, |  |  | 2020 |  |  | 2019
Net (loss) gains recognized during the period on equity securities |  | $ | (123) |  | $ | 1
Less: Net gains (loss) recognized during the period on equity securities sold during the period |  |  |  |  |  |
Unrealized (loss) gain recognized during the reporting period on equity securities still held at the reporting date |  | $ | (123) |  | $ | 1
Restricted Investment In Stock Restricted investment in stock includes FHLB with a carrying cost of $10,642 and $10,159 at March 31, 2020 and December 31, 2019, respectively, Atlantic Community Bankers Bank (“ACBB”) stock with a carrying cost of $42, and VISA Class B stock with a carrying cost of $0 at March 31, 2020 and December 31, 2019, 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 bank’s use of FHLB’s services. The increase in FHLB stock from December 31, 2019 is due to an increase in short term borrowings at FHLB. 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 (1.6228 as of March 31, 2020), 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 March 31, 2020, 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 March 31, 2020, is summarized as follows:
|  | Fair |
March 31, 2020 |  | Value |
Within one year |  | $ | 37,800 |
After one but within five years |  |  | 79,696 |
After five but within ten years |  |  | 18,995 |
After ten years |  |  | 39,313 |
|  |  | 175,804 |
Mortgage-backed and other amortizing securities |  |  | 127,080 |
Total |  | $ | 302,884 |
The maturity distribution of the amortized cost and fair value, of debt securities classified as held-to-maturity at March 31, 2020, is summarized as follows:
|  | Amortized |  | Fair |
March 31, 2020 |  | Cost |  | Value |
After ten years |  | $ | 6,851 |  | $ | 6,989 |
|  |  | 6,851 |  |  | 6,989 |
Mortgage-backed securities |  |  | 669 |  |  | 698 |
Total |  | $ | 7,520 |  | $ | 7,687 |
Securities with a carrying value of $133,308 and $157,047 at March 31, 2020 and December 31, 2019, 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 March 31, 2020 and December 31, 2019, 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 March 31, 2020 and December 31, 2019, 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 |
March 31, 2020 |  | Value |  | Losses |  | Value |  | Losses |  | Value |  | Losses |
State and municipals: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Taxable |  | $ | 8,632 |  | $ | 328 |  |  |  |  |  |  |  | $ | 8,632 |  | $ | 328 |
Tax-exempt |  |  | 3,149 |  |  | 23 |  |  |  |  |  |  |  |  | 3,149 |  |  | 23 |
Residential mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. government agencies |  |  |  |  |  |  |  | $ | 1,133 |  | $ | 3 |  |  | 1,133 |  |  | 3 |
U.S. government-sponsored enterprises |  |  | 22 |  |  | 1 |  |  | 747 |  |  | 3 |  |  | 769 |  |  | 4 |
Total |  | $ | 11,803 |  | $ | 352 |  | $ | 1,880 |  | $ | 6 |  | $ | 13,683 |  | $ | 358 |
|  | 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 |
Management, from a credit risk perspective, has taken action to identify and assess its COVID-19 related credit exposures based on asset class. No specific COVID-19 related credit impairment was identified within our investment securities portfolio, including our municipal securities, during the first quarter of 2020. The Company had 24 investment securities, consisting of 5 tax-exempt and 8 taxable state and municipal obligations and 11 mortgage-backed securities that were in unrealized loss positions at March 31, 2020. Of these securities, 10 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 March 31, 2020. There was no OTTI recognized for the three months ended March 31, 2020 and 2019.

X
- References No definition available. + Details
Name: | us-gaap_InvestmentsDebtAndEquitySecuritiesAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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 + Details
Name: | us-gaap_InvestmentsInDebtAndMarketableEquitySecuritiesAndCertainTradingAssetsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration