
	December 31, 2023
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Allowance for Credit Losses		Estimated Fair Value
U.S. treasury notes and bonds	$	59,812	$	—	$	4,480	$	—	$	55,332
Mortgage-backed securities, residential	476,240		6		72,422		—		403,824
Collateralized mortgage obligations	—		—		—		—		—
Obligations of states and political subdivisions	39,503		—		817		—		38,686
Corporate bonds and notes	25,750		—		5,081		—		20,669
SBA loan pools	67,787		75		2,380		—		65,482


Total	$	669,092	$	81	$	85,180	$	—	$	583,993


	December 31, 2022
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
U.S. treasury notes and bonds	$	61,800	$	—	$	6,225	$	55,574
Mortgage-backed securities, residential	518,838		—		83,707		435,131
Collateralized mortgage obligations	—		—		—		—
Obligations of states and political subdivisions	39,828		2		938		38,892
Corporate bonds and notes	25,750		—		3,780		21,970
SBA loan pools	82,982		155		2,116		81,022


Total	$	729,198	$	157	$	96,766	$	632,589

Proceeds from the sale of available for sale securities for the year ended December 31, 2023 were $1.2 million, and a gross loss of $14 thousand was realized on these sales. The sales were executed by Chemung Risk Management, Inc., which served as a wholly owned captive insurance company based in the State of Nevada, until dissolution by the Corporation effective December 6, 2023. There were no proceeds from sales and calls of securities resulting in gains or losses during the year ended December 31, 2022. The tax benefit related to these net realized losses was $4 thousand for the year ended December 31, 2023.

The amortized cost and estimated fair value of debt securities available for sale are shown below by contractual maturity. Expected maturities may differ from contractual maturities if borrowers have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately (in thousands):


	December 31, 2023
	Amortized Cost		Estimated Fair Value
Within one year	$	5,678	$	5,594
After one, but within five years	101,391		94,363
After five, but within ten years	17,526		14,302
After ten years	470		428
Mortgage-backed securities: residential	476,240		403,824




SBA loan pools	67,787		65,482
Total	$	669,092	$	583,993

Amortized cost and estimated fair value of securities held to maturity at December 31, 2023 and 2022 are as follows (in thousands):


	December 31, 2023
	Amortized Cost		Unrecognized Gains		Unrecognized Losses		Estimated Fair Value		Allowance for Credit Losses
Obligations of states and political subdivisions	$	785	$	—	$	—	$	785	$	—
Time deposits with other financial institutions	—		—		—		—		—
	$	785	$	—	$	—	$	785	$	—


	December 31, 2022
	Amortized Cost		Unrecognized Gains		Unrecognized Losses		Estimated Fair Value
Obligations of states and political subdivisions	$	952	$	—	$	—	$	952
Time deposits with other financial institutions	1,472		—		22		1,450
	$	2,424	$	—	$	22	$	2,402

Proceeds from the sale of held to maturity securities for the year ended December 31, 2023 were $1.0 million, and a gross loss of $25 thousand was realized on these sales. The sales were executed by Chemung Risk Management, Inc., which served as a wholly owned captive insurance company based in the State of Nevada, until dissolution by the Corporation effective December 6, 2023. There were no proceeds from sales of securities held to maturity during the year ended December 31, 2022.


	December 31, 2023
	Amortized Cost		Fair Value
Within one year	$	—	$	—
After one, but within five years	145		145
After five, but within ten years	640		640
After ten years	—		—
Total	$	785	$	785

The following tables summarize the investment securities available for sale with unrealized losses, for which an allowance for credit losses has not been recorded as of December 31, 2023, and an other than temporary impairment (OTTI) has not been recorded as of December 31, 2022 aggregated by major security type and length of time in a continuous unrealized loss position (in thousands):


	Less than 12 months				12 months or longer				Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
2023
U.S. treasury notes and bonds	$	—	$	—	$	55,332	$	4,480	$	55,332	$	4,480
Mortgage-backed securities: residential	—		—		402,986		72,422		402,986		72,422
Obligations of states and political subdivisions	17,891		241		20,686		576		38,577		817
Corporate bonds and notes	7,492		2,508		13,177		2,573		20,669		5,081
SBA loan pools	3,914		13		54,468		2,367		58,382		2,380
Total temporarily impaired securities	$	29,297	$	2,762	$	546,649	$	82,418	$	575,946	$	85,180


	Less than 12 months				12 months or longer				Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
2022
U.S. treasury notes and bonds	$	1,011	$	30	$	54,563	$	6,195	$	55,574	$	6,225
Mortgage-backed securities, residential	79,891		7,621		355,240		76,086		435,131		83,707
Obligations of states and political subdivisions	37,847		938		—		—		37,847		938
Corporate bonds and notes	4,515		485		7,455		3,295		11,970		3,780
SBA loan pools	14,333		925		51,123		1,191		65,456		2,116
Total temporarily impaired securities	$	137,597	$	9,999	$	468,381	$	86,767	$	605,978	$	96,766

The fair value of securities pledged to secure public funds on deposit or for other purposes as required by law was $255.0 million at December 31, 2023 and $213.8 million at December 31, 2022.

Management assesses the change in fair value of investment securities on a regular basis. Unrealized losses on debt securities may occur from current market conditions, increases in interest rates since the time of purchase, structural changes in an investment, volatility in financial results of specific issuers, or deterioration in credit quality of issuers. Management assesses both qualitative and quantitative factors to determine whether any credit-related allowance is required. The following is a discussion of the credit quality characteristics of major portfolio segments carrying material unrealized losses as of December 31, 2023.

As of December 31, 2023, a significant portion of the Corporation’s unrealized losses in available for sale investment securities related to mortgage-backed securities, issued by government-sponsored entities and agencies. Declines in fair value are attributable to changes in interest rates and market liquidity, not credit quality. The Corporation does not have the intent, and it is not likely to be required, to sell these securities prior to their anticipated recovery. All mortgage-backed securities in the available for sale securities portfolio as of December 31, 2023 were issued by FHLMC, FNMA, or GNMA. Because the Corporation considers these obligations to carry zero credit loss estimates, no allowance for credit losses was recorded as of December 31, 2023.

The Corporation's corporate bonds and notes portfolio is comprised of subordinated debt issues of community and regional banks. Management considers the credit quality of these investments on an individual basis. Management reviews the collectability of these securities, taking into consideration such factors as the financial condition of issuers, reported regulatory capital ratios of the issuers, and credit ratings when available, among other pertinent factors. All corporate bond debt securities continue to accrue interest and make payments as expected with no defaults or deferrals on the part of the issuers. Therefore, the Corporation considers the potential credit risk of the issuers to be immaterial, and no allowance for credit losses was recorded as of December 31, 2023.

Prior to the adoption of ASU 2016-13, Financial Instruments-Credit Losses (Topic 326), the Corporation evaluated its portfolio of available for sale securities for Other than Temporary Impairment (OTTI). As of December 31, 2022, the majority of the Corporation’s unrealized losses in the investment securities portfolio related to mortgage-backed securities. At December 31, 2022, the unrealized losses related to mortgage-backed were securities issued by U.S. government sponsored entities, Fannie Mae and Freddie Mac. Because the decline in fair value is attributable to changes in interest rates and not credit quality, and because the Corporation does not have the intent to sell these securities and it is not likely that it will be required to sell these securities before their anticipated recovery, the Corporation does not consider these securities to be other-than-temporarily impaired at December 31, 2022.