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SECURITIES | 9 Months Ended
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Sep. 30, 2019
Investments, Debt and Equity Securities [Abstract] |
SECURITIES | NOTE 2 – SECURITIES The fair value of equity securities at fair value and the related gross unrealized gains recognized in noninterest income were as follows:
|  |  |  |  | September 30, 2019 |  |  |  |
|  |  |  |  | Gross |  |  | Gross |  |  |  |
|  | Amortized |  |  | Unrealized |  |  | Unrealized |  |  | Fair |
(Dollars in thousands) |  | Cost |  |  | Gains |  |  | Losses |  |  | Value |
Equity securities |  | $ | 2,164 |  |  | $ | 335 |  |  | $ | — |  |  | $ | 2,499 |
|  |  |  |  | December 31, 2018 |  |  |  |
|  |  |  |  | Gross |  |  | Gross |  |  |  |
|  | Amortized |  |  | Unrealized |  |  | Unrealized |  |  | Fair |
(Dollars in thousands) |  | Cost |  |  | Gains |  |  | Losses |  |  | Value |
Equity securities |  | $ | 2,502 |  |  | $ | 459 |  |  | $ | (114 | ) |  | $ | 2,847 |
The fair value of securities available for sale and the related gross unrealized gains and losses recognized in accumulated other comprehensive income (loss) were as follows:
|  |  |  |  | September 30, 2019 |  |  |  |
|  |  |  |  | Gross |  |  | Gross |  |  |  |
|  | Amortized |  |  | Unrealized |  |  | Unrealized |  |  | Fair |
(Dollars in thousands) |  | Cost |  |  | Gains |  |  | Losses |  |  | Value |
U.S. Government and federal agency |  | $ | 23,035 |  |  | $ | 23 |  |  | $ | (9 | ) |  | $ | 23,049 |
U.S. Treasury |  |  | 1,994 |  |  |  | 18 |  |  |  | — |  |  |  | 2,012 |
State and municipal |  |  | 97,824 |  |  |  | 2,932 |  |  |  | (4 | ) |  |  | 100,752 |
Mortgage-backed |  |  | 24,542 |  |  |  | 747 |  |  |  | (3 | ) |  |  | 25,286 |
Corporate |  |  | 2,648 |  |  |  | 34 |  |  |  | (3 | ) |  |  | 2,679 |
Foreign debt |  |  | 500 |  |  |  | — |  |  |  | — |  |  |  | 500 |
Trust preferred securities |  |  | 500 |  |  |  | — |  |  |  | — |  |  |  | 500 |
Total |  | $ | 151,043 |  |  | $ | 3,754 |  |  | $ | (19 | ) |  | $ | 154,778 |
|  |  |  |  | December 31, 2018 |  |  |  |
|  |  |  |  | Gross |  |  | Gross |  |  |  |
|  | Amortized |  |  | Unrealized |  |  | Unrealized |  |  | Fair |
|  | Cost |  |  | Gains |  |  | Losses |  |  | Value |
U.S. Government and federal agency |  | $ | 34,079 |  |  | $ | 1 |  |  | $ | (551 | ) |  | $ | 33,529 |
U.S. Treasury |  |  | 1,992 |  |  |  | — |  |  |  | (45 | ) |  |  | 1,947 |
State and municipal |  |  | 104,317 |  |  |  | 544 |  |  |  | (933 | ) |  |  | 103,928 |
Mortgage-backed |  |  | 21,654 |  |  |  | 126 |  |  |  | (205 | ) |  |  | 21,575 |
Corporate |  |  | 5,147 |  |  |  | 1 |  |  |  | (46 | ) |  |  | 5,102 |
Trust preferred securities |  |  | 500 |  |  |  | — |  |  |  | — |  |  |  | 500 |
Asset-backed securities |  |  | 21 |  |  |  | — |  |  |  | — |  |  |  | 21 |
Total |  | $ | 167,710 |  |  | $ | 672 |  |  | $ | (1,780 | ) |  | $ | 166,602 |
ChoiceOne reviews its securities portfolio on a quarterly basis to determine whether unrealized losses are considered to be temporary or other-than-temporary. No other-than-temporary impairment charges were recorded in the three and nine months ended September 30, 2019 or in the same periods in 2018. ChoiceOne believes that unrealized losses on securities were temporary in nature and were due to changes in interest rates and reduced market liquidity and not as a result of credit quality issues. Presented below is a schedule of maturities of securities as of September 30, 2019, the fair value of securities as of September 30, 2019 and December 31, 2018, and the weighted average yields of securities as of September 30, 2019:
|  | Securities maturing within: |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |  | Fair Value |  |  | Fair Value |
|  | Less than |  |  | 1 Year - |  |  | 5 Years - |  |  | More |  |  | at September 30, |  |  | at December 31, |
(Dollars in thousands) |  | 1 Year |  |  | 5 Years |  |  | 10 Years |  |  | 10 Years |  |  | 2019 |  |  | 2018 |
U.S. Government and federal agency |  | $ | 21,017 |  |  | $ | 2,032 |  |  | $ | — |  |  | $ | — |  |  | $ | 23,049 |  |  | $ | 33,529 |
U.S. Treasury notes and bonds |  |  | — |  |  |  | 2,012 |  |  |  | — |  |  |  | — |  |  |  | 2,012 |  |  |  | 1,947 |
State and municipal |  |  | 13,709 |  |  |  | 49,671 |  |  |  | 35,367 |  |  |  | 2,005 |  |  |  | 100,752 |  |  |  | 103,928 |
Corporate |  |  | — |  |  |  | 2,679 |  |  |  | — |  |  |  | — |  |  |  | 2,679 |  |  |  | 5,102 |
Foreign debt |  |  | 500 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 500 |  |  |  | — |
Trust preferred securities |  |  | 500 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 500 |  |  |  | 500 |
Asset-backed securities |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 21 |
Total debt securities |  |  | 35,726 |  |  |  | 56,394 |  |  |  | 35,367 |  |  |  | 2,005 |  |  |  | 129,492 |  |  |  | 145,027 |
Mortgage-backed securities |  |  | — |  |  |  | 19,164 |  |  |  | 6,122 |  |  |  | — |  |  |  | 25,286 |  |  |  | 21,575 |
Equity securities (1) |  |  | — |  |  |  | — |  |  |  | 1,000 |  |  |  | 1,499 |  |  |  | 2,499 |  |  |  | 2,847 |
Total |  | $ | 35,726 |  |  | $ | 75,558 |  |  | $ | 42,489 |  |  | $ | 3,504 |  |  | $ | 157,277 |  |  | $ | 169,449 |
|  | Weighted average yields: |  |  |  |
|  | Less than |  |  | 1 Year - |  |  | 5 Years - |  |  | More |  |  |  |  |  |  |
|  | 1 Year |  |  | 5 Years |  |  | 10 Years |  |  | 10 Years |  |  | Total |  |  |  |
U.S. Government and federal agency |  |  | 1.99 | % |  |  | 1.98 | % |  |  | — | % |  |  | — | % |  |  | 1.99 | % |  |  |  |
U.S. Treasury notes and bonds |  |  | — |  |  |  | 1.85 |  |  |  | — |  |  |  | — |  |  |  | 1.85 |  |  |  |  |
State and municipal (2) |  |  | 2.73 |  |  |  | 2.85 |  |  |  | 3.21 |  |  |  | 0.64 |  |  |  | 2.91 |  |  |  |  |
Corporate |  |  | — |  |  |  | 2.66 |  |  |  | — |  |  |  | — |  |  |  | 2.66 |  |  |  |  |
Foreign debt |  |  | 2.27 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 2.27 |  |  |  |  |
Trust preferred securities |  |  | 6.00 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 6.00 |  |  |  |  |
Mortgage-backed securities |  |  | — |  |  |  | 3.24 |  |  |  | 2.97 |  |  |  | — |  |  |  | 3.18 |  |  |  |  |
Equity securities (1) |  |  | — |  |  |  | — |  |  |  | 4.61 |  |  |  | — |  |  |  | 1.54 |  |  |  |  |
(1) Equity securities are preferred and common stock that may or may not have a stated maturity. (2) The yield is computed for tax-exempt securities on a fully tax-equivalent basis at an incremental rate of 21%. Following is information regarding unrealized gains and losses on equity securities for the three- and nine-month periods ending September 30:
|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
|  | 2019 |  |  | 2018 |  |  | 2019 |  |  | 2018 |
Net gains and losses recognized during the period |  | $ | (146 | ) |  | $ | 113 |  |  | $ | 119 |  |  | $ | 161 |
Less: Net gains and losses recognized during the period on securities sold |  |  | (2 | ) |  |  | — |  |  |  | 4 |  |  |  | 9 |
Unrealized gains and losses recognized during the reporting period on securities still held at the reporting date |  | $ | (144 | ) |  | $ | 113 |  |  | $ | 115 |  |  | $ | 152 |

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