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Investment Securities | 9 Months Ended
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Sep. 30, 2016
Investment Securities [Abstract] |
Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block] | ## 6. Investment Securities The cost basis and fair values of investment securities are summarized as follows (in thousands): ## Investment securities available for sale (AFS):
|  | September 30, 2016
|  | Cost Basis |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value
US Agency |  | $ | 900 |  |  | $ | — |  |  | $ | — |  |  | $ | 900 |
US Agency mortgage-backed securities |  |  | 83,911 |  |  |  | 2,308 |  |  |  | (34 | ) |  |  | 86,185 |
Taxable municipal |  |  | 827 |  |  |  | — |  |  |  | (1 | ) |  |  | 826 |
Corporate bonds |  |  | 29,686 |  |  |  | 458 |  |  |  | (266 | ) |  |  | 29,878 |
Total |  | $ | 115,324 |  |  | $ | 2,766 |  |  | $ | (301 | ) |  | $ | 117,789 |
## Investment securities held to maturity (HTM):
|  | September 30, 2016
|  | Cost Basis |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value
US Agency mortgage-backed securities |  | $ | 11,725 |  |  | $ | 494 |  |  | $ | — |  |  | $ | 12,219 |
Taxable municipal |  |  | 10,047 |  |  |  | 257 |  |  |  | (12 | ) |  |  | 10,292 |
Corporate bonds and other securities |  |  | 6,048 |  |  |  | 54 |  |  |  | (36 | ) |  |  | 6,066 |
Total |  | $ | 27,820 |  |  | $ | 805 |  |  | $ | (48 | ) |  | $ | 28,577 |
## Investment securities available for sale (AFS):
|  | December 31, 2015
|  | Cost Basis |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value
US Agency |  | $ | 2,900 |  |  | $ | — |  |  | $ | (19 | ) |  | $ | 2,881 |
US Agency mortgage-backed securities |  |  | 96,801 |  |  |  | 1,975 |  |  |  | (442 | ) |  |  | 98,334 |
Corporate bonds |  |  | 18,541 |  |  |  | 18 |  |  |  | (307 | ) |  |  | 18,252 |
Total |  | $ | 118,242 |  |  | $ | 1,993 |  |  | $ | (768 | ) |  | $ | 119,467 |
## Investment securities held to maturity (HTM):
|  | December 31, 2015
|  | Cost Basis |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value
US Agency mortgage-backed securities |  | $ | 10,827 |  |  | $ | 247 |  |  | $ | (53 | ) |  | $ | 11,021 |
Taxable municipal |  |  | 5,592 |  |  |  | 67 |  |  |  | (65 | ) |  |  | 5,594 |
Corporate bonds and other securities |  |  | 5,000 |  |  |  | 3 |  |  |  | (85 | ) |  |  | 4,918 |
Total |  | $ | 21,419 |  |  | $ | 317 |  |  | $ | (203 | ) |  | $ | 21,533 |
Maintaining investment quality is a primary objective of the Company’s investment policy which, subject to certain limited exceptions, prohibits the purchase of any investment security below a Moody’s Investor’s Service or Standard & Poor’s rating of “A.” At September 30, 2016, 67.4% of the portfolio was rated “AAA” as compared to 79.1% at December 31, 2015. Approximately 8.2% of the portfolio was either rated below “A” or unrated at September 30, 2016 as compared to 5.7% at December 31, 2015. The Company sold $1.5 million AFS securities in the third quarter of 2016 resulting in $60,000 of gross investment security gains and sold $9.0 million AFS securities in the first nine months of 2016 resulting in $183,000 of gross investment security gains and $6,000 of gross investment security losses. The Company sold a $1.9 million AFS security in the third quarter of 2015 resulting in $36,000 of gross investment security losses and $2.4 million of AFS securities for the first nine months of 2015 resulting in a $28,000 gross investment security gains and $36,000 of gross investment security losses. The book value of securities, both available for sale and held to maturity, pledged to secure public and trust deposits, and certain Federal Home Loan Bank borrowings was $97,182,000 at September 30, 2016 and $87,096,000 at December 31, 2015. The following tables present information concerning investments with unrealized losses as of September 30, 2016 and December 31, 2015 (in thousands): ## Total investment securities:
|  | September 30, 2016
|  | Less than 12 months |  | 12 months or longer |  | Total
|  | Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses
US Agency |  | $ | 400 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 400 |  |  | $ | — |
US Agency mortgage-backed securities |  |  | 3,082 |  |  |  | (12 | ) |  |  | 1,074 |  |  |  | (22 | ) |  |  | 4,156 |  |  |  | (34 | )
Taxable municipal |  |  | 2,268 |  |  |  | (13 | ) |  |  | — |  |  |  | — |  |  |  | 2,268 |  |  |  | (13 | )
Corporate bonds and other securities |  |  | 6,499 |  |  |  | (90 | ) |  |  | 7,786 |  |  |  | (212 | ) |  |  | 14,285 |  |  |  | (302 | )
Total |  | $ | 12,249 |  |  | $ | (115 | ) |  | $ | 8,860 |  |  | $ | (234 | ) |  | $ | 21,109 |  |  | $ | (349 | )
## Total investment securities:
|  | December 31, 2015
|  | Less than 12 months |  | 12 months or longer |  | Total
|  | Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses
US Agency |  | $ | 1,486 |  |  | $ | (14 | ) |  | $ | 395 |  |  | $ | (5 | ) |  | $ | 1,881 |  |  | $ | (19 | )
US Agency mortgage-backed securities |  |  | 33,359 |  |  |  | (245 | ) |  |  | 9,088 |  |  |  | (250 | ) |  |  | 42,447 |  |  |  | (495 | )
Taxable municipal |  |  | 3,617 |  |  |  | (65 | ) |  |  | — |  |  |  | — |  |  |  | 3,617 |  |  |  | (65 | )
Corporate bonds and other securities |  |  | 8,884 |  |  |  | (160 | ) |  |  | 7,766 |  |  |  | (232 | ) |  |  | 16,650 |  |  |  | (392 | )
Total |  | $ | 47,346 |  |  | $ | (484 | ) |  | $ | 17,249 |  |  | $ | (487 | ) |  | $ | 64,595 |  |  | $ | (971 | )
The unrealized losses are primarily a result of increases in market yields from the time of purchase. In general, as market yields rise, the value of securities will decrease; as market yields fall, the fair value of securities will increase. There are 24 positions that are considered temporarily impaired at September 30, 2016. Management generally views changes in fair value caused by changes in interest rates as temporary; therefore, these securities have not been classified as other-than-temporarily impaired. Management has also concluded that based on current information we expect to continue to receive scheduled interest payments as well as the entire principal balance. Furthermore, management does not intend to sell these securities and does not believe it will be required to sell these securities before they recover in value. Contractual maturities of securities at September 30, 2016 are shown below (in thousands). Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without prepayment penalties. The duration of the total investment securities portfolio at September 30, 2016 is 29.4 months and is lower than the duration at December 31, 2015 which was 34.2 months. The duration remains within our internal established guideline range of 24 to 42 months which we believe is appropriate to maintain proper levels of liquidity, interest rate risk, market valuation sensitivity and profitability. ## Total investment securities:
|  | September 30, 2016
|  | Available for sale |  | Held to maturity
|  | Cost Basis |  | Fair Value |  | Cost Basis |  | Fair Value
Within 1 year |  | $ | 3,999 |  |  | $ | 3,986 |  |  | $ | — |  |  | $ | — |
After 1 year but within 5 years |  |  | 7,778 |  |  |  | 7,824 |  |  |  | 3,400 |  |  |  | 3,378 |
After 5 years but within 10 years |  |  | 35,835 |  |  |  | 36,809 |  |  |  | 9,387 |  |  |  | 9,639 |
After 10 years but within 15 years |  |  | 34,267 |  |  |  | 35,141 |  |  |  | 5,739 |  |  |  | 5,848 |
Over 15 years |  |  | 33,445 |  |  |  | 34,029 |  |  |  | 9,294 |  |  |  | 9,712 |
Total |  | $ | 115,324 |  |  | $ | 117,789 |  |  | $ | 27,820 |  |  | $ | 28,577 |

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