Note 7 - Securities

The following tables summarize the Bank’s holdings for both securities held-to-maturity and securities available-for-sale as of March 31, 2017 and December 31, 2016 (amounts in thousands):


		March 31, 2017
	Amortized	Gross Unrealized		Fair Value
	Costs	Gains	(Losses)
Held-to-Maturity
US agency obligations	$3,293	$50	$(71)	$3,272

Available-for-Sale
US Treasuries	1,953	-	(104)	1,849
US agency obligations	14,291	5	(994)	13,302
Mortgage-backed securities	15,881	1	(348)	15,534
Municipals	12,955	70	(427)	12,598
Corporates	5,151	-	(214)	4,937
	$50,231	$76	$(2,087)	$48,220

		December 31, 2016
	Amortized	Gross Unrealized		Fair Value
	Costs	Gains	(Losses)
Held-to-Maturity
US agency obligations	$3,299	$65	$(91)	$3,273

Available-for-Sale
US Treasuries	1,952	-	(119)	1,833
US agency obligations	14,332	5	(1,224)	13,113
Mortgage-backed securities	12,358	-	(353)	12,005
Municipals	10,425	55	(534)	9,947
Corporates	4,132	-	(254)	3,878
	$43,200	$60	$(2,484)	$40,776

Note 7 – Securities (continued)

The following tables show the gross unrealized losses and fair value of the Bank’s investments with unrealized losses that are not deemed to be other-than-temporarily impaired, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at March 31, 2017 and December 31, 2016 (amounts in thousands):


	Less than 12 months		More than 12 months		Total
	Fair	Unrealized	Fair	Unrealized	Fair	Unrealized
March 31, 2017	Value	Losses	Value	Losses	Value	Losses
Description of securities
Held-to-maturity
US agency obligations	$1,210	$71	$ -	$ -	$1,210	$71

Available-for-sale
US Treasuries	1,848	104	-	-	1,848	104
US agency obligations	13,297	994	-	-	13,297	994
Mortgage-backed securities	13,908	347	638	1	14,546	348
Municipals	8,563	427	-	-	8,563	427
Corporates	-	-	4,937	214	4,937	214
Total	$38,826	$1,943	$5,575	$215	$44,401	$2,158

	Less than 12 months		More than 12 months		Total
	Fair	Unrealized	Fair	Unrealized	Fair	Unrealized
December 31, 2016	Value	Losses	Value	Losses	Value	Losses
Description of securities
Held-to-maturity
US agency obligations	$1,193	$91	$ -	$ -	$1,193	$91

Available-for-sale
US Treasuries	1,833	119	-	-	1,833	119
US agency obligations	13,109	1,224	-	-	13,109	1,224
Mortgage-backed securities	11,331	353	-	-	11,331	353
Municipals	7,170	534	-	-	7,170	534
Corporates	3,878	254	-	-	3,878	254
Total	$38,514	$2,575	$ -	$ -	$38,514	$2,575

Management evaluates securities for other-than-temporary impairment at least on a quarterly basis, and may do so more frequently when economic or market concerns warrant such evaluation. Consideration is given to (1) the length of time and the extent to which the fair value has been less than cost, (2) the financial condition and near-term prospects of the issuer, (3) the intent of Financial, if any, to sell the security; (4) whether Financial more likely than not will be required to sell the security before recovering its cost; and (5) whether Financial does not expect to recover the security’s entire amortized cost basis (even if Financial does not intend to sell the security).

Note 7 – Securities (continued)

At March 31, 2017, the Company did not consider the unrealized losses as other-than-temporary losses due to the nature of the securities involved. As of March 31, 2017, the Bank owned 46 securities in an unrealized loss position that were being evaluated for other than temporary impairment. Nine of these securities were S&P rated AAA, 32 were rated AA and five were rated A. As of March 31, 2017, 23 of these securities were direct obligations of the U.S. government or government sponsored entities, 16 were municipal issues, and seven were investments in domestic corporate issued securities.

Based on the analysis performed by management as mandated by the Bank’s investment policy, management believes the default risk to be minimal. Because the Bank expects to recover the entire amortized cost basis, no declines currently are deemed to be other-than-temporary.

Gross gains on available-for-sale securities were $10 and $65 during the three month periods ended March 31, 2017 and 2016 respectively. There were no losses on sales of available-for-sale securities and no sales of held-to-maturity securities during the three month periods ended March 31, 2017 and 2016.