Securities

The Company invests in U.S. agency and mortgage-backed securities, obligations of state and political subdivisions, corporate equity securities, and corporate debt securities. Amortized costs and fair values of securities at June 30, 2017 and December 31, 2016 were as follows (in thousands):



	June 30, 2017
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Fair Value
Securities available for sale:
U.S. agency and mortgage-backed securities	$	74,574	$	298	$	(644	)	$	74,228
Obligations of states and political subdivisions	15,313		241		(53		)	15,501
Corporate equity securities	1		11		—			12
Total securities available for sale	$	89,888	$	550	$	(697	)	$	89,741
Securities held to maturity:
U.S. agency and mortgage-backed securities	$	34,730	$	93	$	(200	)	$	34,623
Obligations of states and political subdivisions	14,594		294		—			14,888
Corporate debt securities	1,500		—		(10		)	1,490
Total securities held to maturity	$	50,824	$	387	$	(210	)	$	51,001
Total securities	$	140,712	$	937	$	(907	)	$	140,742



	December 31, 2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Fair Value
Securities available for sale:
U.S. agency and mortgage-backed securities	$	81,451	$	177	$	(1,457	)	$	80,171
Obligations of states and political subdivisions	14,654		146		(180		)	14,620
Corporate equity securities	1		10		—			11
Total securities available for sale	$	96,106	$	333	$	(1,637	)	$	94,802
Securities held to maturity:
U.S. agency and mortgage-backed securities	$	37,269	$	1	$	(483	)	$	36,787
Obligations of states and political subdivisions	14,629		18		(211		)	14,436
Corporate debt securities	1,500		—		(14		)	1,486
Total securities held to maturity	$	53,398	$	19	$	(708	)	$	52,709
Total securities	$	149,504	$	352	$	(2,345	)	$	147,511

At June 30, 2017 and December 31, 2016, investments in an unrealized loss position that were temporarily impaired were as follows (in thousands):



	June 30, 2017
	Less than 12 months					12 months or more					Total
	Fair Value		Unrealized (Loss)			Fair Value		Unrealized (Loss)			Fair Value		Unrealized (Loss)
Securities available for sale:
U.S. agency and mortgage-backed securities	$	42,325	$	(493	)	$	4,964	$	(151	)	$	47,289	$	(644	)
Obligations of states and political subdivisions	2,569		(53		)	—		—			2,569		(53		)
Total securities available for sale	$	44,894	$	(546	)	$	4,964	$	(151	)	$	49,858	$	(697	)
Securities held to maturity:
U.S. agency and mortgage-backed securities	$	17,961	$	(200	)	$	—	$	—		$	17,961	$	(200	)
Corporate debt securities	1,490		(10		)	—		—			1,490		(10		)
Total securities held to maturity	$	19,451	$	(210	)	$	—	$	—		$	19,451	$	(210	)
Total securities	$	64,345	$	(756	)	$	4,964	$	(151	)	$	69,309	$	(907	)

	December 31, 2016
	Less than 12 months					12 months or more					Total
	Fair Value		Unrealized (Loss)			Fair Value		Unrealized (Loss)			Fair Value		Unrealized (Loss)
Securities available for sale:
U.S. agency and mortgage-backed securities	$	60,943	$	(1,249	)	$	5,499	$	(208	)	$	66,442	$	(1,457	)
Obligations of states and political subdivisions	5,130		(180		)	—		—			5,130		(180		)
Total securities available for sale	$	66,073	$	(1,429	)	$	5,499	$	(208	)	$	71,572	$	(1,637	)
Securities held to maturity:
U.S. agency and mortgage-backed securities	$	34,770	$	(483	)	$	—	$	—		$	34,770	$	(483	)
Obligations of states and political subdivisions	12,724		(211		)	—		—			12,724		(211		)
Corporate debt securities	1,486		(14		)	—		—			1,486		(14		)
Total securities held to maturity	$	48,980	$	(708	)	$	—	$	—		$	48,980	$	(708	)
Total securities	$	115,053	$	(2,137	)	$	5,499	$	(208	)	$	120,552	$	(2,345	)

The tables above provide information about securities that have been in an unrealized loss position for less than twelve consecutive months and securities that have been in an unrealized loss position for twelve consecutive months or more. Management evaluates securities for other-than-temporary impairment at least on a quarterly basis, and more frequently when economic or market concerns warrant such evaluation. Impairment is considered to be other-than-temporary if the Company (1) intends to sell the security, (2) more likely than not will be required to sell the security before recovering its cost, or (3) does not expect to recover the security’s entire amortized cost basis. Presently, the Company does not intend to sell any of these securities, does not expect to be required to sell these securities, and expects to recover the entire amortized cost of all the securities.

At June 30, 2017, there were forty-two out of eighty-three U.S. agency and mortgage-backed securities, seven out of eighty-one obligations of states and political subdivisions, and one corporate debt security in an unrealized loss position. One hundred percent of the Company’s investment portfolio is considered investment grade. The weighted-average re-pricing term of the portfolio was 4.2 years at June 30, 2017. At December 31, 2016, there were sixty-four out of eighty-three U.S. agency and mortgage-backed securities, fifty of seventy-eight obligations of states and political subdivisions, and one corporate debt security in an unrealized loss position. One hundred percent of the Company’s investment portfolio was considered investment grade at December 31, 2016. The weighted-average re-pricing term of the portfolio was 4.7 years at December 31, 2016. The unrealized losses at June 30, 2017 in the U.S. agency and mortgage-backed securities portfolio, the obligations of states and political subdivisions portfolio, and the corporate debt securities portfolio were related to changes in market interest rates and not credit concerns of the issuers.

For the three and six months ended June 30, 2016, the Company sold one security from the held to maturity portfolio. The Company recognized no gain or loss related to the sale as the carrying value of the security sold equaled the proceeds from the sale of $657 thousand. The sale of this security was in response to credit deterioration of the issuer. There were no sales of securities from the held to maturity portfolio for the three and six month periods ended June 30, 2017.

The amortized cost and fair value of securities at June 30, 2017 by contractual maturity are shown below (in thousands). Expected maturities of mortgage-backed securities will differ from contractual maturities because borrowers may have the right to prepay obligations with or without call or prepayment penalties. Corporate equity securities are not included in the maturity categories in the following maturity summary because they do not have a stated maturity date.



	Available for Sale				Held to Maturity
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Due within one year	$	1,959	$	1,981	$	—	$	—
Due after one year through five years	14,050		14,136		6,195		6,257
Due after five years through ten years	11,412		11,404		14,343		14,549
Due after ten years	62,466		62,208		30,286		30,195
Corporate equity securities	1		12		—		—
	$	89,888	$	89,741	$	50,824	$	51,001

Federal Home Loan Bank, Federal Reserve Bank and Community Bankers’ Bank stock are generally viewed as long-term investments and as restricted securities, which are carried at cost, because there is a minimal market for the stock. Therefore, when evaluating restricted securities for impairment, their value is based on the ultimate recoverability of the par value rather than by recognizing temporary declines in value. The Company does not consider these investments to be other-than-temporarily impaired at June 30, 2017, and no impairment has been recognized.

The composition of restricted securities at June 30, 2017 and December 31, 2016 was as follows (in thousands):



	June 30, 2017		December 31, 2016
Federal Home Loan Bank stock	$	645	$	623
Federal Reserve Bank stock	875		875
Community Bankers’ Bank stock	50		50
	$	1,570	$	1,548