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2. Investment Securities

6 Months Ended

Jun. 30, 2017

Investments, Debt and Equity Securities [Abstract]

2. Investment Securities

Investment securities available for sale at June 30, 2017 and December 31, 2016 are as follows:

(Dollars in thousands)
		June 30, 2017
		Amortized Cost				Gross Unrealized Gains				Gross Unrealized Losses				Estimated Fair Value
Mortgage-backed securities		$	59,302				1,257				182				60,377
U.S. Government
sponsored enterprises			39,254				402				29				39,627
State and political subdivisions			133,298				6,252				20				139,530
Corporate bonds			1,500				36				-				1,536
Trust preferred securities			250				-				-				250
Total		$	233,604				7,947				231				241,320

(Dollars in thousands)
		December 31, 2016
		Amortized Cost				Gross Unrealized Gains				Gross Unrealized Losses				Estimated Fair Value
Mortgage-backed securities		$	66,654				1,221				290				67,585
U.S. Government
sponsored enterprises			38,188				308				274				38,222
State and political subdivisions			137,832				4,176				152				141,856
Corporate bonds			1,500				33				-				1,533
Trust preferred securities			750				-				-				750
Total		$	244,924				5,738				716				249,946

The current fair value and associated unrealized losses on investments in securities with unrealized losses at June 30, 2017 and December 31, 2016 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, 2017
		Less than 12 Months								12 Months or More								Total
		Fair Value				Unrealized Losses				Fair Value				Unrealized Losses				Fair Value				Unrealized Losses
Mortgage-backed securities		$	14,513				182				-				-				14,513				182
U.S. Government
sponsored enterprises			-				-				11,567				29				11,567				29
State and political subdivisions			1,037				4				570				16				1,607				20
Total		$	15,550				186				12,137				45				27,687				231

(Dollars in thousands)
		December 31, 2016
		Less than 12 Months								12 Months or More								Total
		Fair Value				Unrealized Losses				Fair Value				Unrealized Losses				Fair Value				Unrealized Losses
Mortgage-backed securities		$	15,594				290				-				-				15,594				290
U.S. Government
sponsored enterprises			10,120				94				9,562				180				19,682				274
State and political subdivisions			10,441				123				561				29				11,002				152
Total		$	36,155				507				10,123				209				46,278				716

At June 30, 2017, unrealized losses in the investment securities portfolio relating to debt securities totaled $231,000. The unrealized losses on these debt securities arose due to changing interest rates and are considered to be temporary. From the June 30, 2017 tables above, 3 out of 163 securities issued by state and political subdivisions contained unrealized losses, 15 out of 78 securities issued by U.S. Government sponsored enterprises contained unrealized losses, and no 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, 2017, 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, 2017
(Dollars in thousands)
		Amortized Cost				Estimated Fair Value
Due within one year		$	14,885				15,051
Due from one to five years			93,690				97,862
Due from five to ten years			56,040				58,093
Due after ten years			9,437				9,687
Mortgage-backed securities			59,302				60,377
Trust preferred securities			250				250
Total		$	233,604				241,320

No securities available for sale were sold during the six months ended June 30, 2017. 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.

Securities with a fair value of approximately $88.4 million and $95.6 million at June 30, 2017 and December 31, 2016, respectively, were pledged to secure public deposits and for other purposes as required by law.