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2. Investment Securities

9 Months Ended

Sep. 30, 2020

Investments, Debt and Equity Securities [Abstract]

Investment securities available for sale at September 30, 2020 and December 31, 2019 are as follows:

(Dollars in thousands)
	September 30, 2020
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Mortgage-backed securities	$	112,274		3,242		533		114,983
U.S. Government sponsored enterprises		7,479		342		213		7,608
State and political subdivisions		95,196		4,975		21		100,150
Trust preferred securities		250		—		—		250
Total	$	215,199		8,559		767		222,991

(Dollars in thousands)
	December 31, 2019
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Mortgage-backed securities	$	77,812		1,371		227		78,956
U.S. Government sponsored enterprises		28,265		443		311		28,397
State and political subdivisions		84,686		3,657		200		88,143
Trust preferred securities		250		—		—		250
Total	$	191,013		5,471		738		195,746

The current fair value and associated unrealized losses on investments in securities with unrealized losses at September 30, 2020 and December 31, 2019 are summarized in the tables below, with the length of time the individual securities have been in a continuous loss position.

(Dollars in thousands)
	September 30, 2020
	Less than 12 Months				12 Months or More				Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Mortgage-backed securities	$	24,665		532		3,013		1		27,678		533
U.S. Government sponsored enterprises		—		—		4,284		213		4,284		213
State and political subdivisions		3,410		21		—		—		3,410		21
Total	$	28,075		553		7,297		214		35,372		767

(Dollars in thousands)
	December 31, 2019
	Less than 12 Months				12 Months or More				Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Mortgage-backed securities	$	28,395		177		6,351		50		34,746		227
U.S. Government sponsored enterprises		2,899		10		6,151		301		9,050		311
State and political subdivisions		7,367		200		—		—		7,367		200
Total	$	38,661		387		12,502		351		51,163		738

At September 30, 2020, unrealized losses in the investment securities portfolio relating to debt securities totaled $767,000. The unrealized losses on these debt securities arose due to changing interest rates and are considered to be temporary. From the September 30, 2020 tables above, three out of 120 securities issued by state and political subdivisions and 13 out of 73 securities issued by U.S. Government sponsored enterprises 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 September 30, 2020, 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.

September 30, 2020
(Dollars in thousands)
	Amortized Cost		Estimated Fair Value
Due within one year	$	9,837		9,988
Due from one to five years		24,402		25,770
Due from five to ten years		61,085		64,485
Due after ten years		7,351		7,515
Mortgage-backed securities		112,274		114,983
Trust preferred securities		250		250
Total	$	215,199		222,991

Proceeds from sales of securities available for sale during the three months ended September 30, 2020 were $29.2 million and resulted in net gains of $1.7 million. Proceeds from sales of securities available for sale during the nine months ended September 30, 2020 were $46.1 million and resulted in net gains of $2.1 million. Proceeds from sales of securities available for sale during the three months ended September 30, 2019 were $8.4 million and resulted in net losses of $5,000. Proceeds from sales of securities available for sale during the nine months ended September 30, 2019 were $20.7 million and resulted in net gains of $226,000.

Securities with a fair value of approximately $77.7 million and $66.0 million at September 30, 2020 and December 31, 2019, respectively, were pledged to secure public deposits and for other purposes as required by law.