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2. Investment Securities

6 Months Ended

Jun. 30, 2016

Investments, Debt and Equity Securities [Abstract]

2. Investment Securities

Investment securities available for sale at June 30, 2016 and December 31, 2015 are as follows:

(Dollars in thousands)
		June 30, 2016
		Amortized Cost				Gross Unrealized Gains				Gross Unrealized Losses				Estimated Fair Value
Mortgage-backed securities		$	70,509				2,269				-				72,778
U.S. Government
sponsored enterprises			39,913				790				218				40,485
State and political subdivisions			139,193				9,925				2				149,116
Corporate bonds			1,511				8				3				1,516
Trust preferred securities			750				-				-				750
Equity securities			264				205				-				469
Total		$	252,140				13,197				223				265,114

(Dollars in thousands)
		December 31, 2015
		Amortized Cost				Gross Unrealized Gains				Gross Unrealized Losses				Estimated Fair Value
Mortgage-backed securities		$	76,406				1,526				45				77,887
U.S. Government
sponsored enterprises			38,173				399				155				38,417
State and political subdivisions			141,500				6,817				72				148,245
Corporate bonds			1,928				-				22				1,906
Trust preferred securities			750				-				-				750
Equity securities			748				577				-				1,325
Total		$	259,505				9,319				294				268,530

The current fair value and associated unrealized losses on investments in securities with unrealized losses at June 30, 2016 and December 31, 2015 are summarized in the tables below, with the length of time the individual securities have been in a continuous loss position.

(Dollars in thousands)
		June 30, 2016
		Less than 12 Months								12 Months or More								Total
		Fair Value				Unrealized Losses				Fair Value				Unrealized Losses				Fair Value				Unrealized Losses
U.S. Government
sponsored enterprises		$	7,709				65				10,218				153				17,927				218
State and political subdivisions			-				-				593				2				593				2
Corporate bonds			997				3				-				-				997				3
Total		$	8,706				68				10,811				155				19,517				223

(Dollars in thousands)
		December 31, 2015
		Less than 12 Months								12 Months or More								Total
		Fair Value				Unrealized Losses				Fair Value				Unrealized Losses				Fair Value				Unrealized Losses
Mortgage-backed securities		$	7,891				45				-				-				7,891				45
U.S. Government
sponsored enterprises			3,074				13				10,828				142				13,902				155
State and political subdivisions			2,198				4				3,930				68				6,128				72
Corporate bonds			1,500				22				-				-				1,500				22
Total		$	14,663				84				14,758				210				29,421				294

At June 30, 2016, unrealized losses in the investment securities portfolio relating to debt securities totaled $223,000. The unrealized losses on these debt securities arose due to changing interest rates and are considered to be temporary. From the June 30, 2016 tables above, one out of 170 securities issued by state and political subdivisions contained unrealized losses, nine out of 77 securities issued by U.S. Government sponsored enterprises contained unrealized losses, and one out of two securities issued by corporations contained unrealized losses. These unrealized losses are considered temporary because of acceptable financial condition and results of operations of entities that issued each security and the repayment sources of principal and interest on U.S. Government sponsored enterprises, including mortgage-backed securities, are government backed.

The amortized cost and estimated fair value of investment securities available for sale at June 30, 2016, by contractual maturity, are shown below. Expected maturities of mortgage-backed securities will differ from contractual maturities because borrowers have the right to call or prepay obligations with or without call or prepayment penalties.

June 30, 2016
(Dollars in thousands)
		Amortized Cost				Estimated Fair Value
Due within one year		$	5,196				5,218
Due from one to five years			73,590				78,304
Due from five to ten years			88,245				93,409
Due after ten years			14,336				14,936
Mortgage-backed securities			70,509				72,778
Equity securities			264				469
Total		$	252,140				265,114

Proceeds from sales of securities available for sale during the six months ended June 30, 2016 were $804,000 and resulted in gross gains of $324,000. No securities available for sale were sold during the six months ended June 30, 2015.

Securities with a fair value of approximately $83.1 million and $91.0 million at June 30, 2016 and December 31, 2015, respectively, were pledged to secure public deposits and for other purposes as required by law.