SECURITIES

12 Months Ended

Dec. 31, 2020

Investments, Debt and Equity Securities [Abstract]

Amortized cost and fair value at December 31, 2020 and 2019, were as follows:


In thousands	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
SECURITIES AVAILABLE FOR SALE
December 31, 2020
U.S. Government and agencies	$	181,704	$	2,117	$	218	$	183,603
Mortgage-backed securities, residential	105,327		3,529		34		108,822
State and municipal	35,930		561		7		36,484
Corporate bonds	8,784		41		16		8,809
	$	331,745	$	6,248	$	275	$	337,718
December 31, 2019
U.S. Government and agencies	$	113,569	$	849	$	169	$	114,249
Mortgage-backed securities, residential	64,699		980		87		65,592
State and municipal	10,940		70		14		10,996
	$	189,208	$	1,899	$	270	$	190,837
SECURITIES HELD TO MATURITY
December 31, 2020

Mortgage-backed securities, residential	$	10,294	$	474	$	—	$	10,768
	$	10,294	$	474	$	—	$	10,768
December 31, 2019
U.S. Government and agencies	$	4,000	$	8	$	—	$	4,008
Mortgage-backed securities, residential	15,234		76		37		15,273
	$	19,234	$	84	$	37	$	19,281

The fair value disclosures required by ASU 2016-01, Financial Instruments—Overall (Topic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities effective January 1, 2018, are as follows:


In thousands	Fair Value at January 1, 2020		Unrealized Gains		Unrealized Losses		Fair Value at December 31, 2020
December 31, 2020
CRA Mutual Fund	$	1,045	$	25	$	5	$	1,065
Stock in other banks	1,318		—		213		1,105
	$	2,363	$	25	$	218	$	2,170


In thousands	Fair Value at January 1, 2019		Unrealized Gains		Unrealized Losses		Fair Value at December 31, 2019
December 31, 2019
CRA Mutual Fund	$	1,012	$	33	$	—	$	1,045
Stock in other banks	827		234		—		1,061
	$	1,839	$	267	$	—	$	2,106

The following table shows the Corporation’s investments’ gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at December 31, 2020 and 2019:


	Less than 12 Months				12 Months or More				Total
In thousands	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
SECURITIES AVAILABLE FOR SALE
December 31, 2020
U.S. Government and agencies	$	32,629	$	218	$	—	$	—	$	32,629	$	218
Mortgage-backed securities, residential	10,458		34		—		—		10,458		34
State and municipal	2,148		7		—		—		2,148		7
Corporate bonds	1,514		16		—		—		1,514		16
	$	46,749	$	275	$	—	$	—	$	46,749	$	275
December 31, 2019
U.S. Government and agencies	$	—	$	—	$	47,425	$	169	$	47,425	$	169
Mortgage-backed securities, residential	16,208		82		1,424		5		17,632		87
State and municipal	3,233		13		502		1		3,735		14

	$	19,441	$	95	$	49,351	$	175	$	68,792	$	270
SECURITIES HELD TO MATURITY
December 31, 2020
U.S. Government and agencies	$	—	$	—	$	—	$	—	$	—	$	—
Mortgage-backed securities, residential	—		—		—		—		—		—
	$	—	$	—	$	—	$	—	$	—	$	—
December 31, 2019

Mortgage-backed security, residential	$	6,587	$	24	$	3,161	$	13	$	9,748	$	37
	$	6,587	$	24	$	3,161	$	13	$	9,748	$	37

All mortgage-backed security investments are government sponsored enterprise (GSE) pass-through instruments issued by the Federal National Mortgage Association (FNMA), Government National Mortgage Association (GNMA) or Federal Home Loan Mortgage Corporation (FHLMC), which guarantee the timely payment of principal on these investments.

At December 31, 2020, fourteen available for sale U.S. Government and agency securities had unrealized losses that individually did not exceed 3% of amortized cost. None of these securities have been in a continuous loss position for 12 months or more. These unrealized losses relate principally to changes in interest rates subsequent to the acquisition of the specific securities.

At December 31, 2020, nine available for sale residential mortgage-backed securities had unrealized losses that individually did not exceed 1% of amortized cost. None of these securities have been in a continuous loss position for 12 months or more. These unrealized losses relate principally to changes in interest rates subsequent to the acquisition of the specific securities.

At December 31, 2020, three available for sale state and municipal securities had unrealized losses that individually did not exceed 2% of amortized cost. None of these securities have been in a continuous loss position for 12 months or more. These unrealized losses relate principally to changes in interest rates subsequent to the acquisition of the specific securities.

At December 31, 2020, two corporate bonds had unrealized losses that individually did not exceed 3% of amortized cost. These securities have not been in a continuous loss position for 12 months or more. These unrealized losses relate principally to changes in interest rates subsequent to the acquisition of the specific securities.

In analyzing the issuer’s financial condition, management considers industry analysts’ reports, financial performance, and projected target prices of investment analysts within a one-year time frame. Based on the above information, management has determined that none of these investments are other-than-temporarily impaired.

The fair values of securities available for sale (carried at fair value) and held to maturity (carried at amortized cost) are

determined by obtaining quoted market prices on nationally recognized securities exchanges (Level 1), or matrix pricing (Level 2), which is a mathematical technique used widely in the industry to value debt securities without relying exclusively on quoted market prices for the specific securities but rather by relying on the security’s relationship to other benchmark quoted prices. The Corporation uses independent service providers to provide matrix pricing.

Management routinely sells securities from its available for sale portfolio in an effort to manage and allocate the portfolio. At December 31, 2020, management had not identified any securities with an unrealized loss that it intends to sell or will be required to sell. In estimating other-than-temporary impairment losses on debt securities, management considers (1) whether management intends to sell the security, or (2) if it is more likely than not that management will be required to sell the security before recovery, or (3) if management does not expect to recover the entire amortized cost basis. In assessing potential other-than-temporary impairment for equity securities, consideration is given to management’s intention and ability to hold the securities until recovery of unrealized losses.

Amortized cost and fair value at December 31, 2020, by contractual maturity, where applicable, are shown below. Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay with or without penalties.


	Available for Sale				Held to Maturity
In thousands	Amortized Cost		Fair Value		Amortized Cost		Fair Value
1 year or less	$	61,958	$	62,546	$	—	$	—
Over 1 year through 5 years	37,888		39,080		—		—
Over 5 years through 10 years	81,927		82,132		—		—
Over 10 years	44,645		45,138		—		—
Mortgage-backed securities, residential	105,327		108,822		10,294		10,768
	$	331,745	$	337,718	$	10,294	$	10,768

The Corporation did not sell any securities available for sale during 2019 or 2020.

At December 31, 2020 and 2019, securities with a carrying value of $301,201,000 and $162,946,000, respectively, were pledged as collateral as required by law on public and trust deposits, repurchase agreements, and for other purposes.