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Note 2 - Securities

12 Months Ended

Dec. 31, 2020

Notes to Financial Statements

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

Note 2 – Securities

The fair value of equity securities and the related gross unrealized gains recognized in noninterest income at December 31 were as follows:

December 31, 2020

Gross

Gross

(Dollars in thousands)

Amortized

Unrealized

Unrealized

Fair

Cost

Gains

Losses

Value

Equity securities

$

2,836

$

60

$

-

$

2,896

December 31, 2019

Gross

Gross

(Dollars in thousands)

Amortized

Unrealized

Unrealized

Fair

Cost

Gains

Losses

Value

Equity securities

$

2,426

$

425

$

-

$

2,851

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:

		December 31, 2020
						Gross				Gross
(Dollars in thousands)		Amortized				Unrealized				Unrealized				Fair
		Cost				Gains				Losses				Value
U.S. Government and federal agency		$	2,007			$	44			$	-			$	2,051
U.S. Treasury notes and bonds			1,996				60				-				2,056
State and municipal			307,201				13,191				(24	)			320,368
Mortgage-backed			246,085				1,510				(872	)			246,723
Corporate			2,539				51				(1	)			2,589
Trust preferred securities			1,000				-				-				1,000
Total		$	560,828			$	14,856			$	(897	)		$	574,787

		December 31, 2019
						Gross				Gross
(Dollars in thousands)		Amortized				Unrealized				Unrealized				Fair
		Cost				Gains				Losses				Value
U.S. Government and federal agency		$	17,231			$	23			$	(39	)		$	17,215
U.S. Treasury notes and bonds			1,994				14				-				2,008
State and municipal			172,487				2,694				(1,257	)			173,924
Mortgage-backed			142,504				585				(329	)			142,760
Corporate			2,649				24				(1	)			2,672
Trust preferred securities			1,000				-				-				1,000
Total		$	337,865			$	3,340			$	(1,626	)		$	339,579

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

(Dollars in thousands)
		2020				2019				2018
Proceeds from sales of securities		$	121,942			$	178,913			$	2,634
Gross realized gains			1,308				22				42
Gross realized losses			-				-				8

Contractual maturities of equity securities and securities available for sale at December 31, 2020 were as follows:

(Dollars in thousands)		Amortized				Fair
		Cost				Value
Due within one year		$	17,050			$	17,184
Due after one year through five years			59,120				60,900
Due after five years through ten years			221,304				231,775
Due after ten years			17,269				18,205
Total debt securities			314,743				328,064
Mortgage-backed securities			246,085				246,723
Equity securities			2,836				2,896
Total		$	563,664			$	577,683

Certain securities were pledged as collateral for participation in a program that provided Community Reinvestment Act credits. The carrying amount of the securities pledged as collateral at December 31 was as follows:

(Dollars in thousands)		2020				2019
Securities pledged for Community Reinvestment Act credits		$	278			$	252

Securities with unrealized losses at year-end 2020 and 2019, aggregated by investment category and length of time the individual securities have been in an unrealized loss position, were as follows:

		2020
		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		$	-			$	-			$	-			$	-			$	-			$	-
U.S. Treasury notes and bonds			-				-				-				-				-				-
State and municipal			8,950				24				-				-				8,950				24
Mortgage-backed			75,126				866				9,994				6				85,120				872
Corporate			453				1				-				-				453				1
Total temporarily impaired		$	84,529			$	891			$	9,994			$	6			$	94,523			$	897

		2019
		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		$	7,175			$	(39	)		$	-			$	-			$	7,175			$	(39	)
U.S. Treasury notes and bonds			-				-				-				-				-				-
State and municipal			75,099				(1,256	)			252				(1	)			75,351				(1,257	)
Mortgage-backed			109,652				(327	)			373				(2	)			110,025				(329	)
Corporate			-				-				300				(1	)			300				(1	)
Total temporarily impaired		$	191,926			$	(1,622	)		$	925			$	(4	)		$	192,851			$	(1,626	)

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 issuer 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, 2020 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 2020 or 2019.

Following is information regarding unrealized gains and losses on equity securities for the years ending December 31:

		2020				2019				2018

Net gains and losses recognized during the period		$	(155	)		$	—			$	71
Less: Net gains and losses recognized during the period on securities sold			—				(5	)			9

Unrealized gains and losses recognized during the reporting period on securities still held at the reporting date		$	(155	)		$	5			$	62

At December 31, 2020, there were 22 securities with an unrealized loss, compared to 63 securities with an unrealized loss as of December 31, 2019.