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v3.22.2.2

Investments | 9 Months Ended
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Sep. 30, 2022
Investments [Abstract] |
Investments | Note 4 – Investments The amortized cost, gross unrealized gains and losses, and fair value of investment securities at September 30, 2022 and December 31, 2021 were as follows (in thousands):
September 30, 2022 |  | Amortized Cost |  |  | Gross Unrealized Gains |  |  | Gross Unrealized Losses |  |  | Fair Value |
Available-for-sale securities: |  |  |  |  |  |  |  |  |  |  |  |
U.S. agency securities |  | $ | 81,546 |  |  | $ | - |  |  | $ | (7,564 | ) |  | $ | 73,982 |
U.S. treasury securities |  |  | 162,172 |  |  |  | - |  |  |  | (14,328 | ) |  |  | 147,844 |
Obligations of state and political subdivisions |  |  | 123,230 |  |  |  | 10 |  |  |  | (12,790 | ) |  |  | 110,450 |
Corporate obligations |  |  | 10,346 |  |  |  | - |  |  |  | (908 | ) |  |  | 9,438 |
Mortgage-backed securities in government sponsored entities |  |  | 118,118 |  |  |  | 19 |  |  |  | (14,629 | ) |  |  | 103,508 |
Total available-for-sale securities |  | $ | 495,412 |  |  | $ | 29 |  |  | $ | (50,219 | ) |  | $ | 445,222 |
December 31, 2021 |  |  |  |  |  |  |  |  |  |  |  |
Available-for-sale securities: |  |  |  |  |  |  |  |  |  |  |  |
U.S. agency securities |  | $ | 73,803 |  |  | $ | 976 |  |  | $ | (834 | ) |  | $ | 73,945 |
U.S. treasury securities |  |  | 116,743 |  |  |  | 63 |  |  |  | (1,459 | ) |  |  | 115,347 |
Obligations of state and political subdivisions |  |  | 109,367 |  |  |  | 2,706 |  |  |  | (52 | ) |  |  | 112,021 |
Corporate obligations |  |  | 10,378 |  |  |  | 39 |  |  |  | (84 | ) |  |  | 10,333 |
Mortgage-backed securities in government sponsored entities |  |  | 101,727 |  |  |  | 597 |  |  |  | (1,568 | ) |  |  | 100,756 |
Total available-for-sale securities |  | $ | 412,018 |  |  | $ | 4,381 |  |  | $ | (3,997 | ) |  | $ | 412,402 |
The following table shows the Company’s gross unrealized losses and fair value of the Company’s investments with unrealized losses that are not deemed to be other-than-temporarily impaired, aggregated by investment category and length of time, which individual securities have been in a continuous unrealized loss position, at September 30, 2022 and December 31, 2021 (in thousands). As of September 30, 2022, the Company owned 343 securities whose fair value was less than their cost basis.
September 30, 2022 |  | Less than Twelve Months |  |  | Twelve Months or Greater |  |  | Total |
|  | Fair Value |  |  | Gross Unrealized Losses |  |  | Fair Value |  |  | Gross Unrealized Losses |  |  | Fair Value |  |  | Gross Unrealized Losses |
U.S. agency securities |  | $ | 48,992 |  |  | $ | (2,443 | ) |  | $ | 24,990 |  |  | $ | (5,121 | ) |  | $ | 73,982 |  |  | $ | (7,564 | )
U.S. treasury securities |  |  | 65,232 |  |  |  | (3,667 | ) |  |  | 82,612 |  |  |  | (10,661 | ) |  |  | 147,844 |  |  |  | (14,328 | )
Obligations of state and political subdivisions |  |  | 94,880 |  |  |  | (11,086 | ) |  |  | 8,892 |  |  |  | (1,704 | ) |  |  | 103,772 |  |  |  | (12,790 | )
Corporate obligations |  |  | 4,474 |  |  |  | (372 | ) |  |  | 3,964 |  |  |  | (536 | ) |  |  | 8,438 |  |  |  | (908 | )
Mortgage-backed securities in government sponsored entities |  |  | 43,787 |  |  |  | (4,476 | ) |  |  | 50,030 |  |  |  | (10,153 | ) |  |  | 93,817 |  |  |  | (14,629 | )
Total securities |  | $ | 257,365 |  |  | $ | (22,044 | ) |  | $ | 170,488 |  |  | $ | (28,175 | ) |  | $ | 427,853 |  |  | $ | (50,219 | )
December 31, 2021 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. agency securities |  | $ | 26,754 |  |  | $ | (387 | ) |  | $ | 7,542 |  |  | $ | (447 | ) |  | $ | 34,296 |  |  | $ | (834 | )
U.S. treasury securities |  |  | 106,794 |  |  |  | (1,459 | ) |  |  | - |  |  |  | - |  |  |  | 106,794 |  |  |  | (1,459 | )
Obligations of states and political subdivisions |  |  | 10,744 |  |  |  | (26 | ) |  |  | 2,899 |  |  |  | (26 | ) |  |  | 13,643 |  |  |  | (52 | )
Corporate obligations |  |  | 6,922 |  |  |  | (84 | ) |  |  | - |  |  |  | - |  |  |  | 6,922 |  |  |  | (84 | )
Mortgage-backed securities in government sponsored entities |  |  | 60,182 |  |  |  | (1,305 | ) |  |  | 7,975 |  |  |  | (263 | ) |  |  | 68,157 |  |  |  | (1,568 | )
Total securities |  | $ | 211,396 |  |  | $ | (3,261 | ) |  | $ | 18,416 |  |  | $ | (736 | ) |  | $ | 229,812 |  |  | $ | (3,997 | )
As of September 30, 2022 and December 31, 2021, the Company’s investment securities portfolio contained unrealized losses on U.S. Treasuries, agency securities issued or backed by the full faith and credit of the United States government or are generally viewed as having the implied guarantee of the U.S. government, obligations of states and political subdivisions, corporate obligations and mortgage backed securities in government sponsored entities. For fixed maturity investments management considers whether the present value of cash flows expected to be collected are less than the security’s amortized cost basis (the difference defined as the credit loss), the magnitude and duration of the decline, the reasons underlying the decline and the Company’s intent to sell the security or whether it is more likely than not that the Company would be required to sell the security before its anticipated recovery in fair value, to determine whether the loss in value is other than temporary. Once a decline in value is determined to be other than temporary, if the Company does not intend to sell the security, and it is more likely than not that it will not be required to sell the security before recovery of the security’s amortized cost basis, the charge to earnings is limited to the amount of credit loss. Any remaining difference between fair value and amortized cost (the difference defined as the non-credit portion) is recognized in other comprehensive income, net of applicable taxes. Otherwise, the entire difference between fair value and amortized cost is charged to earnings. The Company has concluded that any impairment of its investment securities portfolio outlined in the above table is not other than temporary and is the result of market interest rate changes, sector credit rating changes, or issuer-specific rating changes that are not expected to result in the non-collection of principal and interest during the period. Proceeds from sales of securities available-for-sale for the nine months ended September 30, 2022 and 2021 were $4,492,000 and $29,198,000, respectively. Proceeds from sales of securities available-for-sale for the three months ended September 30, 2022 and 2021 were $4,492,000 and $24,153,000, respectively. The gross gains and losses were as follows (in thousands):
|  | Three Months Ended |  |  | Nine Months Ended |
|  | September 30, |  |  | September 30, |
|  | 2022 |  |  | 2021 |  |  | 2022 |  |  | 2021 |
Gross gains on available for sale securities |  | $ | - |  |  | $ | 252 |  |  | $ | - |  |  | $ | 302 |
Gross losses on available for sale securities |  |  | (6 | ) |  |  | (90 | ) |  |  | (6 | ) |  |  | (90 | )
Net gains |  | $ | (6 | ) |  | $ | 162 |  |  | $ | (6 | ) |  | $ | 212 |
The following table presents the net gains (losses) on the Company’s equity investments recognized in earnings during the three and nine month periods ended September 30, 2022 and 2021, and the portion of unrealized gains for the period that relates to equity investments held at September 30, 2022 and 2021 (in thousands):
|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
Equity securities |  | 2022 |  |  | 2021 |  |  | 2022 |  |  | 2021 |
Net (losses) gains recognized in equity securities during the period |  | $ | (19 | ) |  | $ | 72 |  |  | $ | (198 | ) |  | $ | 288 |
Less: Net gains realized on the sale of equity securities during the period |  |  | 4 |  |  |  | - |  |  |  | 4 |  |  |  | - |
Net unrealized (losses) gains |  | $ | (23 | ) |  | $ | 72 |  |  | $ | (202 | ) |  | $ | 288 |
Investment securities with an approximate carrying value of $302.2 million and $295.0 million at September 30, 2022 and December 31, 2021, respectively, were pledged to secure public funds, certain other deposits and borrowing lines. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. The amortized cost and fair value of debt securities (excludes equity securities) at September 30, 2022, by contractual maturity, are shown below (in thousands):
|  | Amortized Cost |  |  | Fair Value |
Available-for-sale debt securities: |  |  |  |  |  |
Due in one year or less |  | $ | 14,108 |  |  | $ | 13,996 |
Due after one year through five years |  |  | 199,749 |  |  |  | 184,858 |
Due after five years through ten years |  |  | 110,505 |  |  |  | 97,613 |
Due after ten years |  |  | 171,050 |  |  |  | 148,755 |
Total |  | $ | 495,412 |  |  | $ | 445,222 |

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- Definition The entire disclosure for investments in certain debt and equity securities. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 320 -URI https://asc.fasb.org/subtopic&trid=2209399 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 946 -SubTopic 320 -URI https://asc.fasb.org/subtopic&trid=2324412 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -URI https://asc.fasb.org/topic&trid=2196928 Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 940 -SubTopic 320 -URI https://asc.fasb.org/subtopic&trid=2176304 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher SEC -Name Regulation S-K (SK) -Number 229 -Section 1403 -Paragraph (b) + Details
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