Securities

The following tables summarize securities available-for-sale as of June 30, 2015 and December 31, 2014.



	June 30, 2015
	Amortized		Gross Unrealized					Fair
	Cost		Gains		Losses			Value
Securities available-for-sale
U.S. Government-sponsored agencies	$	27,993	$	127	$	(548	)	$	27,572
Municipal securities	15,219		—		(440		)	14,779
Mortgage-backed securities	107,055		192		(573		)	106,674
Asset-backed securities	19,430		23		(1		)	19,452
Corporate securities	20,000		—		(695		)	19,305
Other securities	3,000		—		(15		)	2,985
Total available-for-sale	$	192,697	$	342	$	(2,272	)	$	190,767



	December 31, 2014
	Amortized		Gross Unrealized					Fair
	Cost		Gains		Losses			Value
Securities available-for-sale
U.S. Government-sponsored agencies	$	13,680	$	129	$	(257	)	$	13,552
Mortgage-backed securities	117,134		282		(368		)	117,048
Asset-backed securities	4,913		—		(1		)	4,912
Other securities	2,000		6		—			2,006
Total available-for-sale	$	137,727	$	417	$	(626	)	$	137,518

The carrying value of securities at June 30, 2015 is shown below by their contractual maturity date. Actual maturities will differ because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.



	Available-for-Sale
	Amortized Cost		Fair Value
Within one year	$	—	$	—
One to five years	—		—
Five to ten years	22,848		22,352
After ten years	40,364		39,304
	63,212		61,656
Mortgage-backed securities	107,055		106,674
Asset-backed securities	19,430		19,452
Other securities	3,000		2,985
Total	$	192,697	$	190,767

Gross realized gains of $0 and $0.9 million, and gross losses of $0 and $0.8 million, resulting from sales of available-for-sale securities were recognized during the three months ended June 30, 2015 and 2014, respectively. Gross realized gains of $0 and $2.3 million, and gross losses of $0 and $1.8 million, resulting from sales of available-for-sale securities were recognized during the six months ended June 30, 2015 and 2014, respectively.

Certain investments in debt securities are reported in the condensed consolidated financial statements at an amount less than their historical cost. The total fair value of these investments at June 30, 2015 and December 31, 2014 was $139.9 million and $86.9 million, which is approximately 73% and 63%, respectively, of the Company’s available-for-sale securities portfolio. These declines resulted primarily from fluctuations in market interest rates after purchase.

Except as discussed below, management believes the declines in fair value for these securities are temporary.

Should the impairment of any of these securities become other-than-temporary, the cost basis of the security will be reduced and the resulting loss recognized in net income in the period in which the other-than-temporary impairment (“OTTI”) is identified.

The following tables show the securities portfolio's gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at June 30, 2015 and December 31, 2014.



	June 30, 2015
	Less Than 12 Months					12 Months or Longer					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Securities available-for-sale
U.S. Government-sponsored agencies	$	10,425	$	(307	)	$	8,364	$	(241	)	$	18,789	$	(548	)
Municipal securities	14,779		(440		)	—		—			14,779		(440		)
Mortgage-backed securities	59,028		(218		)	19,945		(355		)	78,973		(573		)
Asset-backed securities	5,080		(1		)	—		—			5,080		(1		)
Corporate securities	19,305		(695		)	—		—			19,305		(695		)
Other securities	2,985		(15		)	—		—			2,985		(15		)
Total	$	111,602	$	(1,676	)	$	28,309	$	(596	)	$	139,911	$	(2,272	)



	December 31, 2014
	Less Than 12 Months					12 Months or Longer					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Securities available-for-sale
U.S. Government-sponsored agencies	$	801	$	(10	)	$	8,719	$	(247	)	$	9,520	$	(257	)
Mortgage-backed securities	51,204		(57		)	21,237		(311		)	72,441		(368		)
Asset-backed securities	4,912		(1		)	—		—			4,912		(1		)
Total	$	56,917	$	(68	)	$	29,956	$	(558	)	$	86,873	$	(626	)

U. S. Government-Sponsored Agencies, Municipal Securities and Corporate Securities

The unrealized losses on the Company’s investments in securities issued by U.S. Government-sponsored agencies, municipal organizations and corporate entities were caused by interest rate changes. The contractual terms of those investments do not permit the issuer to settle the securities at a price less than the amortized cost bases of the investments. Because the Company does not intend to sell the investments and it is not likely that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at June 30, 2015.

Mortgage-Backed and Asset-Backed Securities

The unrealized losses on the Company’s investments in mortgage-backed and asset-backed securities were caused by interest rate changes. The Company expects to recover the amortized cost bases over the term of the securities. Because the Company does not intend to sell the investments and it is not likely that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at June 30, 2015.

Other Securities

The unrealized losses on the Company’s investments in other securities were caused by interest rate changes. The balance consists of one investment in the Community Reinvestment Act Qualified Fund. Because the Company does not intend to sell the investment and it is not likely that the Company will be required to sell the investment before recovery of its amortized cost basis, the Company does not consider this investment to be other-than-temporarily impaired at June 30, 2015.

Credit Losses Recognized on Investments

Certain debt securities have experienced fair value deterioration due to credit losses and other market factors, but are not considered other-than-temporarily impaired.

The following tables provide information about debt securities for which only a credit loss was recognized in income and other losses are recorded in accumulated other comprehensive loss. The Company did not own any OTTI securities during the three or six months ended June 30, 2015.



	Accumulated Credit Losses
Credit losses on debt securities held
April 1, 2014	$	1,150
Realized losses related to OTTI	(1,106		)
Recoveries related to OTTI	(44		)
June 30, 2014	$	—



	Accumulated Credit Losses
Credit losses on debt securities held
January 1, 2014	$	1,183
Realized losses related to OTTI	(1,139		)
Recoveries related to OTTI	(44		)
June 30, 2014	$	—

There were no amounts reclassified from accumulated other comprehensive income during the three and six months ended June 30, 2015. Amounts reclassified from accumulated other comprehensive loss and the affected line items in the condensed consolidated statements of income during the three and six months ended June 30, 2014, were as follows:



Details About Accumulated Other Comprehensive Loss Components	Amounts Reclassified from Accumulated Other Comprehensive Loss for the Three Months Ended June 30, 2014		Affected Line Item in the Statements of Income
Unrealized gains and losses on securities available for sale
Gain realized in earnings	$	125	Gain on sale of securities
Total reclassified amount before tax	125		Income Before Income Taxes
Tax expense	39		Income Tax Provision
Total reclassifications out of accumulated other comprehensive loss	$	86	Net Income



Details About Accumulated Other Comprehensive Loss Components	Amounts Reclassified from Accumulated Other Comprehensive Loss for the Six Months Ended June 30, 2014		Affected Line Item in the Statements of Income
Unrealized gains and losses on securities available for sale
Gain realized in earnings	$	484	Gain on sale of securities
Total reclassified amount before tax	484		Income Before Income Taxes
Tax expense	165		Income Tax Provision
Total reclassifications out of accumulated other comprehensive loss	$	319	Net Income