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Investment securities

12 Months Ended

Dec. 31, 2022

Investment securities

Investment securities

3. Investment securities:

The amortized cost and fair value of investment securities aggregated by investment category at December 31, 2022 and 2021 are summarized as follows:


		December 31, 2022
					Gross			Gross
		Amortized			Unrealized			Unrealized			Fair
(Dollars in thousands)		Cost			Gains			Losses			Value
Available-for-sale:
U.S. Treasury securities		$	199,937		$			$	19,640		$	180,297
U.S. government-sponsored enterprises			16,955						585			16,370
State and municipals:
Taxable			68,946						13,588			55,358
Tax-exempt			99,774			93			11,460			88,407
Residential mortgage-backed securities:
U.S. government agencies			982						40			942
U.S. government-sponsored enterprises			141,231						20,112			121,119
Commercial mortgage-backed securities:
U.S. government-sponsored enterprises			12,128						544			11,584
Corporate debt securities			4,000						374			3,626
Total		$	543,953		$	93		$	66,343		$	477,703
Held-to-maturity:
Tax-exempt state and municipals		$	11,237		$	1		$	841		$	10,397
Residential mortgage-backed securities:
U.S. government agencies			17,304						3,016			14,288
U.S. government-sponsored enterprises			62,638						10,760			51,878
Total		$	91,179		$	1		$	14,617		$	76,563


		December 31, 2021
					Gross			Gross
		Amortized			Unrealized			Unrealized			Fair
(Dollars in thousands)		Cost			Gains			Losses			Value
Available-for-sale:
U.S. Treasury securities		$	193,849		$	107		$	2,382		$	191,574
U.S. government-sponsored enterprises			33,435			343						33,778
State and municipals:
Taxable			69,066			994			1,082			68,978
Tax-exempt			96,412			2,452			614			98,250
Residential mortgage-backed securities:
U.S. government agencies			1,790			53						1,843
U.S. government-sponsored enterprises			109,018			939			2,925			107,032
Commercial mortgage-backed securities:
U.S. government-sponsored enterprises			12,542			406						12,948
Corporate debt securities			3,000						82			2,918
Total		$	519,112		$	5,294		$	7,085		$	517,321
Held-to-maturity:
Tax-exempt state and municipals		$	11,476		$	126		$	56		$	11,546
Residential mortgage-backed securities:
U.S. government agencies			18,802						392			18,410
U.S. government-sponsored enterprises			40,935			3			448			40,490
Total		$	71,213		$	129		$	896		$	70,446

At December 31, 2022, our marketable equity security portfolio consisted of stock of one financial institution. At December 31, 2022 and December 31, 2021, we had $0.1 million in equity securities recorded at fair value. At December 31, 2022, the fair value of our equity portfolio was less than the cost basis by $44 thousand. The following is a summary of unrealized and realized gains and losses recognized in net income on equity marketable securities during 2022 and 2021.



(Dollars in thousands)			2022			2021
Net (loss) gain recognized during the period on equity securities		$	(31)		$	2
Unrealized gain recognized during the reporting period on equity securities still held at the reporting date		$	(31)		$	2

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, 2022, is summarized as follows:


		Fair
(Dollars in thousands)		Value
Within one year		$	15,601
After one but within five years			168,324
After five but within ten years			72,917
After ten years			84,933
			341,775
Mortgage-backed and other amortizing securities			135,928
Total		$	477,703

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, 2022, is summarized as follows:


		Amortized			Fair
(Dollars in thousands)		Cost			Value
After five but within ten years		$	8,884		$	8,227
After ten years			2,353			2,170
			11,237			10,397
Mortgage-backed securities			79,942			66,166
Total		$	91,179		$	76,563

Securities with a carrying value of $168.0 million and $203.6 million at December 31, 2022 and 2021, 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, 2022 and 2021, 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, 2022 and 2021, aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position, are summarized as follows:


		December 31, 2022
		Less Than 12 Months								12 Months or Greater								Total
		Number of								Number of								Number of
		Securities in a		Fair			Unrealized			Securities in a		Fair			Unrealized			Securities in a		Fair			Unrealized
(Dollars in thousands)		Loss Position		Value			Losses			Loss Position		Value			Losses			Loss Position		Value			Losses
U.S. Treasury securities		5		$	23,700		$	1,887		40		$	156,597		$	17,753		45		$	180,297		$	19,640
U.S. government-sponsored enterprises		4			14,104			197		1			2,266			388		5			16,370			585
State and municipals:
Taxable		21			19,919			2,908		45			34,464			10,680		66			54,383			13,588
Tax-exempt		39			30,973			1,690		84			59,664			10,611		123			90,637			12,301
Residential mortgage-backed securities:
U.S. government agencies		5			904			39		4			14,326			3,017		9			15,230			3,056
U.S. government-sponsored enterprises		19			57,166			2,029		25			115,831			28,843		44			172,997			30,872
Commercial mortgage-backed securities:
U.S. government agencies
U.S. government-sponsored enterprises		4			11,584			544		0			0			0		4			11,584			544
Corporate debt securities		1			953			47		5			2,673			327		6			3,626			374
Total		98		$	159,303		$	9,341		204		$	385,821		$	71,619		302		$	545,124		$	80,960


		December 31, 2021
		Less Than 12 Months								12 Months or Greater								Total
		Number of								Number of								Number of
		Securities in a		Fair			Unrealized			Securities in a		Fair			Unrealized			Securities in a		Fair			Unrealized
(Dollars in thousands)		Loss Position		Value			Losses			Loss Position		Value			Losses			Loss Position		Value			Losses
U.S. Treasury securities		42		$	179,974		$	2,382				$			$			42		$	179,974		$	2,382
U.S. government-sponsored enterprises
State and municipals:
Taxable		27			26,827			718		8			8,008			364		35			34,835			1,082
Tax-exempt		61			38,693			357		2			10,319			313		63			49,012			670
Residential mortgage-backed securities:
U.S. government agencies		3			18,398			392										3			18,398			392
U.S. government-sponsored enterprises		13			77,875			1,454		7			48,276			1,919		20			126,151			3,373
Commercial mortgage-backed securities:
U.S. government-sponsored enterprises
Corporate debt securities		4			2,449			51		1			470			31		5			2,919			82
Total		150		$	344,216		$	5,354		18		$	67,073		$	2,627		168		$	411,289		$	7,981

Management does not consider the unrealized losses on the debt securities, as a result of significantly higher market 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 known 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, 2022.

There was no OTTI recognized for each of the years in the three-year period ended December 31, 2022.