Investment Securities

3 Months Ended

Mar. 31, 2020

Investments Debt And Equity Securities [Abstract]

3.	INVESTMENT SECURITIES

Details of investment securities available-for-sale and held-to-maturity as of March 31, 2020 and December 31, 2019 were as follows:

	Available-for-Sale
	March 31, 2020
			Gross		Gross			Estimated
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
	(Dollars in Thousands)
Mortgage-backed securities:
Residential	$	42,525	$	589	$	(12	)	$	43,102
Commercial		48,624		379		(263	)		48,740
Obligations of states and political subdivisions		3,872		80		—			3,952
Corporate notes		666		—		—			666
U.S. Treasury securities		81		—		—			81
Total	$	95,768	$	1,048	$	(275	)	$	96,541

	Held-to-Maturity
	March 31, 2020
			Gross		Gross			Estimated
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
	(Dollars in Thousands)
Mortgage-backed securities:
Commercial	$	8,158	$	89	$	—		$	8,247
Obligations of U.S. government-sponsored agencies		4,309		34		—			4,343
Obligations of states and political subdivisions		1,071		—		(16	)		1,055
Total	$	13,538	$	123	$	(16	)	$	13,645

	Available-for-Sale
	December 31, 2019
			Gross		Gross			Estimated
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
	(Dollars in Thousands)
Mortgage-backed securities:
Residential	$	46,182	$	372	$	(209	)	$	46,345
Commercial		43,686		73		(386	)		43,373
Obligations of states and political subdivisions		4,123		95		—			4,218
U.S. Treasury securities		80		—		—			80
Total	$	94,071	$	540	$	(595	)	$	94,016

	Held-to-Maturity
	December 31, 2019
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
	(Dollars in Thousands)
Mortgage-backed securities:
Commercial	$	8,923	$	2	$	(46	)	$	8,879
Obligations of U.S. government-sponsored agencies		4,324		5		(10	)		4,319
Obligations of states and political subdivisions		1,093		15		—			1,108
Total	$	14,340	$	22	$	(56	)	$	14,306

The scheduled maturities of investment securities available-for-sale and held-to-maturity as of March 31, 2020 are presented in the following table:

	Available-for-Sale				Held-to-Maturity
	Amortized Cost		Estimated Fair Value		Amortized Cost		Estimated Fair Value
	(Dollars in Thousands)
Maturing within one year	$	1,601	$	1,621	$	40	$	40
Maturing after one to five years		15,561		15,706		766		750
Maturing after five to ten years		43,163		43,770		6,852		6,891
Maturing after ten years		35,443		35,444		5,880		5,964
Total	$	95,768	$	96,541	$	13,538	$	13,645

For purposes of the maturity table, mortgage-backed securities, which are not due at a single maturity date, have been allocated over maturity groupings based on the weighted-average contractual maturities of underlying collateral. The mortgage-backed securities generally mature earlier than their weighted-average contractual maturities because of principal prepayments.

The following tables reflect gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, as of March 31, 2020 and December 31, 2019.

	Available-for-Sale
	March 31, 2020
	Less than 12 Months					12 Months or More
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
	(Dollars in Thousands)
Mortgage-backed securities:
Residential	$	576	$	(2	)	$	4,865	$	(10	)
Commercial		7,066		—			4,701		(263	)
Corporate notes		666		—			—		—
U.S. Treasury securities		80		—			—		—
Total	$	8,388	$	(2	)	$	9,566	$	(273	)

	Held-to-Maturity
	March 31, 2020
	Less than 12 Months					12 Months or More
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
	(Dollars in Thousands)
Obligations of states and political subdivisions		750		(16	)		—		—
Total	$	750	$	(16	)	$	—	$	—

	Available-for-Sale
	December 31, 2019
	Less than 12 Months					12 Months or More
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
	(Dollars in Thousands)
Mortgage-backed securities:
Residential	$	17,340	$	(66	)	$	10,094	$	(143	)
Commercial		3,794		(25	)		29,754		(361	)
U.S. Treasury securities		80		—			—		—
Total	$	21,214	$	(91	)	$	39,848	$	(504	)

	Held-to-Maturity
	December 31, 2019
	Less than 12 Months					12 Months or More
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
	(Dollars in Thousands)
Mortgage-backed securities:
Commercial	$	685	$	—		$	6,405	$	(46	)
Obligations of U.S. government-sponsored agencies		846		(4	)		2,994		(6	)
Total	$	1,531	$	(4	)	$	9,399	$	(52	)

Management evaluates securities for other-than-temporary impairment no less frequently than quarterly and more frequently when economic or market concerns warrant such evaluation. Consideration is given to: (i) the length of time and the extent to which fair value has been less than cost; (ii) the financial condition and near-term prospects of the issuer; (iii) whether the Company intends to sell the securities; and (iv) whether it is more likely than not that the Company will be required to sell the securities before recovery of their amortized cost bases.

As of March 31, 2020, 18 debt securities had been in a loss position for more than 12 months, and 14 debt securities had been in a loss position for less than 12 months. As of December 31, 2019, 69 debt securities had been in a loss position for more than 12 months, and 35 debt securities had been in a loss position for less than 12 months. As of both March 31, 2020 and December 31, 2019, the losses for all securities were considered to be a direct result of the effect that the prevailing interest rate environment had on the value of debt securities and were not related to the creditworthiness of the issuers. There was a substantial decrease in interest rates during the first quarter of 2020, including a 150-basis point reduction in the federal funds rate in March 2020. This resulted in significant increases in the fair value of debt securities and a corresponding decline in the number of securities in a loss position as of March 31, 2020 compared to December 31, 2019. Most of the securities in an unrealized loss position as of both March 31, 2020 and December 31, 2019 were residential or commercial mortgage-backed securities that are either direct obligations of the U.S. government or government-sponsored entities and, accordingly, have little associated credit risk. Further, the Company has the current intent and ability to retain its investments in the issuers for a period of time that management believes to be sufficient to allow for any anticipated recovery in fair value. Therefore, the Company did not recognize any other-than-temporary impairments as of March 31, 2020 or December 31, 2019.

Investment securities with a carrying value of $62.2 million and $51.7 million as of March 31, 2020 and December 31, 2019, respectively, were pledged to secure public deposits and for other purposes.