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Securities
 12 Months Ended
Dec. 31, 2015
Investments, Debt and Equity Securities [Abstract]  
Securities

Note 2 – Securities

 

The fair value of securities available for sale and the related gross unrealized gains and losses recognized in accumulated other comprehensive income (loss) at December 31 were as follows:

 

    2015  
(Dollars in thousands)   Amortized
Cost		   Gross
Unrealized
Gains		   Gross
Unrealized
Losses		   Fair
Value		  
U.S. Government and federal agency   $ 57,406   $ 30   $ (229 ) $ 57,207  
U.S. Treasury notes and bonds     6,133     —     (33 )   6,100  
State and municipal     76,005     1,858     (109 )   77,754  
Mortgage-backed     6,989     26     (45 )   6,970  
Corporate     8,418     8     (39 )   8,387  
Foreign debt     1,000     —     (5 )   995  
Equity securities     2,279     174     —     2,453  
Asset-backed securities     274     —     (4 )   270  
Total   $ 158,504   $ 2,096   $ (464 ) $ 160,136  

 

    2014  
(Dollars in thousands)   Amortized
Cost		   Gross
Unrealized
Gains		   Gross
Unrealized
Losses		   Fair
Value		  
U.S. Government and federal agency   $ 44,584   $ 77   $ (158 ) $ 44,503  
U.S. Treasury notes and bonds     8,077     11     (30 )   8,058  
State and municipal     68,376     1,697     (238 )   69,835  
Mortgage-backed     8,896     68     (22 )   8,942  
Corporate     7,529     25     (16 )   7,538  
Foreign debt     1,000     —     (6 )   994  
Equity securities     2,280     —     (5 )   2,275  
Asset-backed securities     378     —     (2 )   376  
Total   $ 141,120   $ 1,878   $ (477 ) $ 142,521  

 

Information regarding sales of securities available for sale for the year ended December 31 follows:

 

(Dollars in thousands)                    
    2015   2014   2013  
Proceeds from sales of securities   $ 25,876   $ 24,766   $ 8,790  
Gross realized gains     261     341     197  
Gross realized losses     —     30     60  

 

Contractual maturities of securities available for sale at December 31, 2015 were as follows:

 

(Dollars in thousands)   Fair
Value		 
     
Due within one year  $24,173 
Due after one year through five years   94,705 
Due after five years through ten years   35,831 
Due after ten years   2,974 
Total debt securities   157,683 
Equity securities   2,453 
Total  $160,136 

 

Various securities were pledged as collateral for securities sold under agreements to repurchase, advances from the Federal Home Loan Bank, and participation in a program that provided Community Reinvestment Act credits. The carrying amount of securities pledged as collateral at December 31 was as follows:

 

(Dollars in thousands)          
    2015    2014 
Securities pledged for securities sold under agreements to repurchase  $7,011   $34,369 
Securities pledged for advances from the Federal Home Loan Bank   24,199    — 
Security pledged for Community Reinvestment Act credits   276    279 
Total  $31,486   $34,648 

 

The fair value of securities pledged to secure repurchase agreements may decline, and the Company may be required to provide additional collateral. The Company manages this risk by pledging securities with fair values in excess of the repurchase liability.

 

Securities with unrealized losses at year-end 2015 and 2014, aggregated by investment category and length of time the individual securities have been in an unrealized loss position, were as follows:

                   
   2015
   Less than 12 months  More than 12 months  Total       
(Dollars in thousands)  Fair  Unrealized  Fair  Unrealized  Fair  Unrealized  
   Value  Losses  Value  Losses  Value  Losses  
U.S. Government and federal agency  $38,567   $(216)  $986   $(13)  $39,553   $(229)
U.S. Treasury notes and bonds   6,101    (33)   —    —    6,101    (33)
State and municipal   10,382    (69)   2,906    (40)   13,288    (109)
Mortgage-backed   4,459    (41)   382    (4)   4,841    (45)
Corporate   4,284    (33)   896    (6)   5,180    (39)
Foreign debt   995    (5)   —    —    995    (5)
Asset-backed securities   —    —    270    (4)   270    (4)
Total temporarily impaired  $64,788   $(397)  $5,440   $(67)  $70,228   $(464)

                   
   2014
   Less than 12 months  More than 12 months  Total       
(Dollars in thousands)  Fair  Unrealized  Fair  Unrealized  Fair  Unrealized  
   Value  Losses  Value  Losses  Value  Losses  
U.S. Government and federal agency  $11,323   $(26)  $13,005   $(132)  $24,328   $(158)
U.S. Treasury notes and bonds   —    —    2,089    (30)   2,089    (30)
State and municipal   8,463    (59)   8,977    (179)   17,440    (238)
Mortgage-backed   989    (4)   1,535    (18)   2,524    (22)
Corporate   2,054    (7)   1,393    (9)   3,447    (16)
Foreign debt   —    —    994    (6)   994    (6)
Equity securities   1,000    (5)   —    —    1,000    (5)
Asset-backed securities   —    —    376    (2)   376    (2)
Total temporarily impaired  $23,829   $(101)  $28,369   $(376)  $52,198   $(477)

 

ChoiceOne evaluates all securities on a quarterly basis to determine whether unrealized losses are temporary or other than temporary. Consideration is given to the length of time and the extent to which the fair value has been less than cost, the financial condition and near-term prospects of the issuer, and the intent and ability of ChoiceOne to retain its investment in the issue for a period of time sufficient to allow for any anticipated recovery in fair value of amortized cost basis. Management believed that unrealized losses as of December 31, 2015 were temporary in nature and were caused primarily by changes in interest rates, increased credit spreads, and reduced market liquidity and were not caused by the credit status of the issuer. No other than temporary impairments were recorded in 2015 or 2014.

 

At December 31, 2015, there were 82 securities with an unrealized loss, compared to 42 securities with an unrealized loss as of December 31, 2014. The increase in the number of securities in an unrealized loss position was caused by higher interest rates at the end of 2015 compared to the end of 2014.