AFS Securities

6 Months Ended

Jun. 30, 2021

Investments, Debt and Equity Securities [Abstract]

The amortized cost and fair value of AFS securities, with gross unrealized gains and losses, are as follows at:


	June 30, 2021
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
U.S. Treasury	$	132,291	$	310	$	8	$	132,593
States and political subdivisions	126,002		4,971		13		130,960
Auction rate money market preferred	3,200		60		—		3,260
Mortgage-backed securities	66,091		2,064		—		68,155
Collateralized mortgage obligations	105,965		3,332		3		109,294
Corporate	4,200		17		25		4,192
Total	$	437,749	$	10,754	$	49	$	448,454


	December 31, 2020
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
States and political subdivisions	$	137,710	$	5,946	$	—	$	143,656
Auction rate money market preferred	3,200		37		—		3,237
Mortgage-backed securities	85,926		2,726		—		88,652
Collateralized mortgage obligations	97,430		4,553		—		101,983
Corporate	1,700		—		—		1,700
Total	$	325,966	$	13,262	$	—	$	339,228

The amortized cost and fair value of AFS securities by contractual maturity at June 30, 2021 are as follows:


	Maturing								Securities with Variable Monthly Payments or Noncontractual Maturities
	Due in One Year or Less		After One Year But Within Five Years		After Five Years But Within Ten Years		After Ten Years				Total
U.S. Treasury	$	—	$	91,414	$	40,877	$	—	$	—	$	132,291
States and political subdivisions	21,977		56,225		22,662		25,138		—		126,002
Auction rate money market preferred	—		—		—		—		3,200		3,200
Mortgage-backed securities	—		—		—		—		66,091		66,091
Collateralized mortgage obligations	—		—		—		—		105,965		105,965
Corporate	—		—		4,200		—		—		4,200
Total amortized cost	$	21,977	$	147,639	$	67,739	$	25,138	$	175,256	$	437,749
Fair value	$	22,121	$	149,934	$	68,968	$	26,722	$	180,709	$	448,454

Expected maturities for government sponsored enterprises and states and political subdivisions may differ from contractual maturities because issuers may have the right to call or prepay obligations.

As the auction rate money market preferred investments have continual call dates, they are not reported by a specific maturity group. Because of their variable monthly payments, mortgage-backed securities and collateralized mortgage obligations are not reported by a specific maturity group.

A summary of the sales activity of AFS securities was as follows for the:


	Three Months Ended June 30				Six Months Ended June 30
	2021		2020		2021		2020
Proceeds from sales of AFS securities	$	—	$	—	$	—	$	26,855
Realized gains (losses)	$	—	$	—	$	—	$	71
Applicable income tax expense (benefit)	$	—	$	—	$	—	$	15

The following information pertains to AFS securities with gross unrealized losses at June 30, 2021, aggregated by investment category and length of time that individual securities have been in a continuous loss position. There were no AFS securities with gross unrealized losses in a continuous loss position at December 31, 2020.


	June 30, 2021
	Less Than Twelve Months				Twelve Months or More
	Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Total Unrealized Losses
U.S. Treasury	$	8	$	19,584	$	—	$	—	$	8
States and political subdivisions	13		5,322		—		—		13
Collateralized mortgage obligations	3		9,717		—		—		3
Corporate	25		2,475						25
Total	$	49	$	37,098	$	—	$	—	$	49
Number of securities in an unrealized loss position:			13				—		13

The reduction in unrealized gains on our AFS securities portfolio resulted from the recent increases in intermediate-term and long-term benchmark interest rates.

As of June 30, 2021 and December 31, 2020, we conducted an analysis to determine whether any AFS securities currently in an unrealized loss position should be identified as other-than-temporarily impaired. Such analyses considered, among other factors, the following criteria:

•Has the value of the investment declined more than what is deemed to be reasonable based on a risk and maturity adjusted discount rate?

•Is the investment credit rating below investment grade?

•Is it probable the issuer will be unable to pay the amount when due?

•Is it more likely than not that we will have to sell the security before recovery of its cost basis?

•Has the duration of the investment been extended?

Based on our analysis, which included the criteria outlined above and the fact that we have asserted that we do not have to sell any AFS securities in an unrealized loss position, we do not believe that the values of any AFS securities are other-than-temporarily impaired as of June 30, 2021 or December 31, 2020, with the exception of one municipal bond previously identified which had no activity during the period.