NOTE 2 – Investment Securities

The amortized costs and fair value of investment securities are as follows:


	December 31, 2018
	Amortized		Gross Unrealized		Fair
(dollars in thousands)		Cost	Gains	Losses	Value
Available for sale
US government agencies	$	8,975	1	194	8,782
SBA securities		3,628	-	103	3,525
State and political subdivisions		8,371	48	63	8,356
Asset-backed securities		9,595	12	49	9,558
Mortgage-backed securities
FHLMC		12,258	87	242	12,103
FNMA		29,068	25	551	28,542
GNMA		4,170	1	132	4,039
Total mortgage-backed securities		45,496	113	925	44,684
Total	$	76,065	174	1,334	74,905


	December 31, 2017
	Amortized		Gross Unrealized		Fair
		Cost	Gains	Losses	Value
Available for sale
US government agencies	$	8,749	1	97	8,653
SBA securities		4,087	-	24	4,063
State and political subdivisions		11,242	179	25	11,396
Mortgage-backed securities
FHLMC		9,102	-	149	8,953
FNMA		29,383	3	386	29,000
GNMA		5,618	2	82	5,538
Total mortgage-backed securities		44,103	5	617	43,491
Total	$	68,181	185	763	67,603

The amortized costs and fair values of investment securities available for sale at December 31, 2018 and 2017, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities because issuers have the right to prepay the obligations.


	December 31,
			2018		2017
	Amortized		Fair	Amortized	Fair
(dollars in thousands)		Cost	Value	Cost	Value
Available for sale
Due within one year	$	-	-	1,435	1,427
Due after one through five years		8,681	8,578	2,677	2,666
Due after five through ten years		22,796	22,379	24,796	24,645
Due after ten years		44,588	43,948	39,273	38,865
	$	76,065	74,905	68,181	67,603

The tables below summarize gross unrealized losses on investment securities and the fair market value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at December 31, 2018 and 2017.


	Less than 12 months					12 months or longer									Total
		Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
(dollars in thousands)	#	value		losses		#	value		losses		#	value		losses
As of December 31, 2018
Available for sale
US government agencies	1	$	1,246	$	3	8	$	7,035	$	191	9	$	8,281	$	194
SBA securities	-		-		-	2		3,525		103	2		3,525		103
State and political subdivisions	-		-		-	7		2,829		63	7		2,829		63
Asset-backed	4		6,707		49	-		-		-	4		6,707		49
Mortgage-backed
FHLMC	-		-		-	10		7,402		242	10		7,402		242
FNMA	2		2,689		6	23		22,814		545	25		25,503		551
GNMA	1		1,104		6	3		2,919		126	4		4,023		132
	8	$	11,746	$	64	53	$	46,524	$	1,270	61	$	58,270	$	1,334


	Less than 12 months					12 months or longer					Total
		Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
	#	value		losses		#	value		losses		#	value		losses
As of December 31, 2017
Available for sale
US government agencies	5	$	4,184	$	22	4	$	3,968	$	75	9	$	8,152	$	97
SBA securities	1		2,936		13	1		1,127		11	2		4,063		24
State and political subdivisions	3		1,214		9	2		792		16	5		2,006		25
Mortgage-backed
FHLMC	3		2,897		26	7		6,056		123	10		8,953		149
FNMA	11		14,345		135	13		14,597		251	24		29,940		386
GNMA	2		2,270		40	1		971		42	3		2,243		82
	25	$	27,846	$	245	28	$	27,511	$	518	53	$	55,357	$	763

At December 31, 2018, the Company had 8 individual investments with a fair market value of $11.7 million that were in an unrealized loss position for less than 12 months and 53 individual investments with a fair market value of $46.5 million that were in an unrealized loss position for 12 months or longer. The unrealized losses were primarily attributable to changes in interest rates, rather than deterioration in credit quality. The individual securities are each investment grade securities. The Company considers the length of time and extent to which the fair value of available-for-sale debt securities have been less than cost to conclude that such securities were not other-than-temporarily impaired. We also consider other factors such as the financial condition of the issuer including credit ratings and specific events affecting the operations of the issuer, volatility of the security, underlying assets that collateralize the debt security, and other industry and macroeconomic conditions. As the Company has no intent to sell securities with unrealized losses and it is not more-likely-than-not that the Company will be required to sell these securities before recovery of amortized cost, we have concluded that the securities are not impaired on an other-than-temporary basis.

Other investments are comprised of the following and are recorded at cost which approximates fair value:


	December 31,
(dollars in thousands)	2018		2017
Federal Home Loan Bank stock	$	3,587	3,754
Other investments		131	305
Investment in Trust Preferred subsidiaries		403	403
	$	4,121	4,462

The Company has evaluated the FHLB stock for impairment and determined that the investment in FHLB stock is not other than temporarily impaired as of December 31, 2018 and ultimate recoverability of the par value of this investment is probable. All of the FHLB stock is used to collateralize advances with the FHLB.

At December 31, 2018, there were no securities pledged as collateral for repurchase agreements from brokers. At December 31, 2017, $7.7 million of securities were pledged as collateral for repurchase agreements from brokers.