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, 2018 and December 31, 2017 (amounts in thousands):


		March 31, 2018
	Amortized	Gross Unrealized		Fair Value
	Costs	Gains	(Losses)
Held-to-Maturity
US agency obligations	$3,708	$ -	$(230)	$3,478

Available-for-Sale
US Treasuries	1,958	-	(144)	1,814
US agency obligations	24,835	5	(1,622)	23,218
Mortgage-backed securities	14,142	3	(480)	13,665
Municipals	12,521	24	(406)	12,139
Corporates	4,113	-	(316)	3,797
	$57,569	$32	$(2,968)	$54,633

		December 31, 2017
	Amortized	Gross Unrealized		Fair Value
	Costs	Gains	(Losses)
Held-to-Maturity
US agency obligations	$5,713	$8	$(102)	$5,619

Available-for-Sale
US Treasuries	1,956	-	(98)	1,858
US agency obligations	24,881	5	(1,036)	23,850
Mortgage-backed securities	13,662	2	(276)	13,388
Municipals	12,556	16	(298)	12,274
Corporates	4,117	-	(175)	3,942
	$57,172	$23	$(1,883)	$55,312

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, 2018 and December 31, 2017 (amounts in thousands):


	Less than 12 months		More than 12 months		Total
	Fair	Unrealized	Fair	Unrealized	Fair	Unrealized
March 31, 2018	Value	Losses	Value	Losses	Value	Losses
Description of securities
Held-to-maturity
US agency obligations	$2,286	$150	$1,192	$80	$3,478	$230

Available-for-sale
US Treasuries	-	-	1,814	144	1,814	144
US agency obligations	9,213	425	14,001	1,197	23,214	1,622
Mortgage-backed securities	1,414	36	11,415	444	12,829	480
Municipals	2,053	42	9,048	364	11,101	406
Corporates	-	-	3,797	316	3,797	316
Total	$12,680	$503	$40,075	$2,465	$52,755	$2,968

	Less than 12 months		More than 12 months		Total
	Fair	Unrealized	Fair	Unrealized	Fair	Unrealized
December 31, 2017	Value	Losses	Value	Losses	Value	Losses
Description of securities
Held-to-maturity
US agency obligations	$2,367	$70	$1,243	$32	$3,610	$102

Available-for-sale
US Treasuries	-	-	1,858	98	1,858	98
US agency obligations	11,465	215	12,379	821	23,844	1,036
Mortgage-backed securities	2,802	26	9,712	250	12,514	276
Municipals	4,823	41	5,644	257	10,467	298
Corporates	-	-	3,942	175	3,942	175
Total	$19,090	$282	$33,535	$1,601	$52,625	$1,883

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, 2018, 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, 2018, the Bank owned 57 securities in an unrealized loss position that were being evaluated for other than temporary impairment. Twelve of these securities were S&P rated AAA, 42 were rated AA and three were rated A. As of March 31, 2018, 33 of these securities were direct obligations of the U.S. government or government sponsored entities, 19 were municipal issues, and five 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 management does not intend to sell and it is likely that management will not be required to sell the securities prior to their anticipated recovery, and the decline in fair value is largely due to change in interest rates and other market conditions, no declines currently are deemed to be other-than-temporary.

There were no gross gains on available-for-sale securities during the three month period ended March 31, 2018 compared to $10 for the same respective period in 2017. 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, 2018 and 2017.