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Investment Securities

6 Months Ended

Jun. 30, 2022

Investments, Debt and Equity Securities [Abstract]

Investment Securities

NOTE 2 – Investment Securities

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


		June 30, 2022
		Amortized				Gross Unrealized								Fair
(dollars in thousands)		Cost				Gains				Losses				Value
Available for sale
Corporate bonds		$	2,185				-				204				1,981
US treasuries			999				-				94				905
US government agencies			13,005				-				1,752				11,253
State and political subdivisions			23,071				4				3,096				19,979
Asset-backed securities			7,922				-				169				7,753
Mortgage-backed securities
FHLMC			21,809				-				2,835				18,974
FNMA			36,865				-				4,200				32,665
GNMA			5,974				-				493				5,481
Total mortgage-backed securities			64,648				-				7,528				57,120
Total investment securities available for sale		$	111,830				4				12,843				98,991

		December 31, 2021
		Amortized				Gross Unrealized								Fair
		Cost				Gains				Losses				Value
Available for sale
Corporate bonds		$	2,198				-				10				2,188
US treasuries			999				-				7				992
US government agencies			14,504				1				336				14,169
SBA securities			429				9				-				438
State and political subdivisions			24,887				549				260				25,176
Asset-backed securities			10,136				45				17				10,164
Mortgage-backed securities
FHLMC			23,057				102				494				22,665
FNMA			40,924				235				660				40,499
GNMA			4,084				3				97				3,990
Total mortgage-backed securities			68,065				340				1,251				67,154
Total investment securities available for sale		$	121,218				944				1,881				120,281

Contractual maturities and yields on the Company’s investment securities at June 30, 2022 and December 31, 2021 are shown in the following table. Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.


																										June 30, 2022
		Less than one year								One to five years								Five to ten years								Over ten years								Total
(dollars in thousands)		Amount				Yield				Amount				Yield				Amount				Yield				Amount				Yield				Amount				Yield
Available for sale
Corporate bonds		$	-				-				-				-				1,981				1.99	%			-				-				1,981				1.99	%
US treasuries			-				-				-				-				905				1.27	%			-				-				905				1.27	%
US government agencies			-				-				2,445				0.83	%			8,001				1.49	%			807				1.48	%			11,253				1.34	%
State and political subdivisions			-				-				468				2.13	%			4,571				1.62	%			14,940				2.19	%			19,979				2.05	%
Asset-backed securities			-				-				-				-				1,246				3.33	%			6,507				2.03	%			7,753				2.23	%
Mortgage-backed securities			-				-				3,280				1.20	%			4,976				1.43	%			48,864				1.60	%			57,120				1.56	%
Total investment securities		$	-				-				6,193				1.12	%			21,680				1.64	%			71,118				1.76	%			98,991				1.69	%

																										December 31, 2021
		Less than one year								One to five years								Five to ten years								Over ten years								Total
(dollars in thousands)		Amount				Yield				Amount				Yield				Amount				Yield				Amount				Yield				Amount				Yield
Available for sale
Corporate bonds		$	-				-				-				-				2,188				1.98	%			-				-				2,188				1.98	%
US treasuries			-				-				-				-				992				1.27	%			-				-				992				1.27	%
US government agencies			-				-				2,481				0.36	%			8,756				1.31	%			2,932				1.79	%			14,169				1.24	%
SBA securities			-				-				-				-				-				-				438				1.01	%			438				1.01	%
State and political subdivisions			-				-				471				2.13	%			4,282				1.61	%			20,423				2.21	%			25,176				2.11	%
Asset-backed securities			-				-				-				-				1,614				1.79	%			8,550				0.97	%			10,164				1.10	%
Mortgage-backed securities			387				2.10	%			4,411				1.29	%			9,121				1.59	%			53,235				1.38	%			67,154				1.40	%
Total investment securities		$	387				2.10	%			7,363				1.03	%			26,953				1.53	%			85,578				1.55	%			120,281				1.52	%

The tables below summarize gross unrealized losses on investment securities and the fair market value of the related securities at June 30, 2022 and December 31, 2021, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position.


		June 30, 2022
		Less than 12 months												12 months or longer												Total
(dollars in thousands)		#				Fair value				Unrealized losses				#				Fair value				Unrealized losses				#				Fair value				Unrealized losses
Available for sale
Corporate bonds			1			$	1,981			$	204				-			$	-			$	-				1			$	1,981			$	204
US treasures			1				905				94				-				-				-				1				905				94
US government agencies			4				6,069				942				6				5,184				810				10				11,253				1,752
State and political subdivisions			22				15,137				2,194				9				4,601				902				31				19,738				3,096
Asset-backed			6				5,496				126				2				1,502				43				8				6,998				169
Mortgage-backed securities
FHLMC			14				14,335				1,990				5				4,640				845				19				18,975				2,835
FNMA			24				17,522				2,028				12				15,133				2,172				36				32,655				4,200
GNMA			4				3,805				301				3				1,676				192				7				5,481				493
Total investment securities			76			$	65,250			$	7,879				37			$	32,736			$	4,964				113			$	97,986			$	12,843

		December 31, 2021
		Less than 12 months												12 months or longer												Total
(dollars in thousands)		#				Fair value				Unrealized losses				#				Fair value				Unrealized losses				#				Fair value				Unrealized losses
Available for sale
Corporate bonds			1			$	2,188			$	10				-			$	-			$	-				1			$	2,188			$	10
US treasures			1				992				7				-				-				-				1				992				7
US government agencies			7				9,831				173				4				3,837				163				11				13,668				336
State and political subdivisions			9				7,821				193				6				2,909				67				15				10,730				260
Asset-backed			2				1,751				9				2				1,717				7				4				3,468				16
Mortgage-backed securities
FHLMC			10				13,705				303				4				4,644				192				14				18,349				495
FNMA			11				16,098				296				9				11,264				364				20				27,362				660
GNMA			2				655				4				3				3,215				93				5				3,870				97
Total investment securities			43			$	53,041			$	995				28			$	27,586			$	886				71			$	80,627			$	1,881

At June 30, 2022 the Company had 76 individual investments with a fair market value of $65.3 million that were in an unrealized loss position for less than 12 months and 37 individual investments with a fair market value of $32.7 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 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. The Company does not intend to sell these securities, and it is more likely than not that the Company will not be required to sell these securities before recovery of the amortized cost.

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


(dollars in thousands)		June 30, 2022				December 31, 2021
Federal Home Loan Bank stock		$	3,632				1,241
Other nonmarketable investments			1,030				2,377
Investment in Trust Preferred subsidiaries			403				403
Total other investments		$	5,065				4,021

The Company has evaluated other investments for impairment and determined that the other investments are not impaired as of June 30, 2022 and that ultimate recoverability of the par value of the investments is probable. All of the FHLB stock is used to collateralize advances with the FHLB.