| SECURITIES |
NOTE 5 - SECURITIES
The amortized cost and fair value of available-for-sale and held-to-maturity securities at September 30, 2015 and December 31, 2014 are summarized as follows:
| | | | | Gross | | Gross | | | | | | | Amortized | | Unrealized | | Unrealized | | Market | | | | | Cost | | Gain | | Loss | | Value | | | | | (In Thousands) | | | September 30, 2015 | | | | | | | | | | | | | | | Securities Available for Sale | | | | | | | | | | | | | | | U.S. Treasury and government sponsored agencies | | $ | 50,508 | | $ | 1,084 | | $ | (71) | | $ | 51,521 | | | Mortgage-backed securities | | | 89,722 | | | 2,845 | | | (46) | | | 92,521 | | | State and municipal securities | | | 143,664 | | | 3,052 | | | (92) | | | 146,624 | | | Corporate debt | | | 15,884 | | | 116 | | | - | | | 16,000 | | | Total | | | 299,778 | | | 7,097 | | | (209) | | | 306,666 | | | Securities Held to Maturity | | | | | | | | | | | | | | | Mortgage-backed securities | | | 22,211 | | | 382 | | | (257) | | | 22,336 | | | State and municipal securities | | | 5,758 | | | 423 | | | (6) | | | 6,175 | | | Total | | $ | 27,969 | | $ | 805 | | $ | (263) | | $ | 28,511 | | | | | | | | | | | | | | | | | | December 31, 2014 | | | | | | | | | | | | | | | Securities Available for Sale | | | | | | | | | | | | | | | U.S. Treasury and government sponsored agencies | | $ | 50,363 | | $ | 775 | | $ | - | | $ | 51,138 | | | Mortgage-backed securities | | | 92,439 | | | 3,095 | | | (11) | | | 95,523 | | | State and municipal securities | | | 132,780 | | | 3,211 | | | (328) | | | 135,663 | | | Corporate debt | | | 15,821 | | | 165 | | | - | | | 15,986 | | | Total | | | 291,403 | | | 7,246 | | | (339) | | | 298,310 | | | Securities Held to Maturity | | | | | | | | | | | | | | | Mortgage-backed securities | | | 23,804 | | | 449 | | | (320) | | | 23,933 | | | State and municipal securities | | | 5,551 | | | 490 | | | - | | | 6,041 | | | Total | | $ | 29,355 | | $ | 939 | | $ | (320) | | $ | 29,974 | |
The amortized cost and fair value of debt securities as of September 30, 2015 by contractual maturity are shown below. Actual maturities may differ from contractual maturities of mortgage-backed securities since the mortgages underlying the securities may be called or prepaid with or without penalty. Therefore, these securities are not included in the maturity categories along with the other categories of debt securities. | | | September 30, 2015 | | December 31, 2014 | | | | | Amortized | | | | Amortized | | | | | | | Cost | | Fair Value | | Cost | | Fair Value | | | | | (In thousands) | | | Debt securities available for sale | | | | | | | | | | | | | | | Less than one year | | $ | 21,289 | | $ | 21,450 | | $ | 16,944 | | $ | 17,246 | | | One year to five years | | | 145,941 | | | 148,960 | | | 121,591 | | | 123,962 | | | Five years to ten years | | | 42,009 | | | 42,891 | | | 60,079 | | | 61,221 | | | More than ten years | | | 817 | | | 844 | | | 350 | | | 358 | | | Mortgage-backed securities | | | 89,722 | | | 92,521 | | | 92,439 | | | 95,523 | | | | | $ | 299,778 | | $ | 306,666 | | $ | 291,403 | | $ | 298,310 | | | | | | | | | | | | | | | | | | Debt securities held to maturity | | | | | | | | | | | | | | | Due from five to ten years | | $ | 627 | | $ | 653 | | $ | 298 | | $ | 325 | | | Due after ten years | | | 5,131 | | | 5,522 | | | 5,253 | | | 5,716 | | | Mortgage-backed securities | | | 22,211 | | | 22,336 | | | 23,804 | | | 23,933 | | | | | $ | 27,969 | | $ | 28,511 | | $ | 29,355 | | $ | 29,974 | |
The Company sold 18 of the 36 debt securities acquired in the Metro transaction in the period just following the acquisition closing date to align maturity structure. The fair value of these securities was assumed to be the amount for which they were sold, and therefore no gain or loss was recognized on these sales. The Company sold one mortgage-backed debt security from its legacy portfolio during the first quarter of 2015 and recognized a gain of $29,000.
All mortgage-backed securities are with government-sponsored enterprises (GSEs) such as Federal National Mortgage Association, Government National Mortgage Association, Federal Home Loan Bank, and Federal Home Loan Mortgage Corporation. The following table identifies, as of September 30, 2015 and December 31, 2014, the Company’s investment securities that have been in a continuous unrealized loss position for less than 12 months and those that have been in a continuous unrealized loss position for 12 or more months. At September 30, 2015, 23 of the Company’s 753 debt securities had been in an unrealized loss position for 12 or more months. The Company does not intend to sell these securities and it is more likely than not that the Company will not be required to sell the securities before recovery of their amortized cost, which may be maturity; accordingly, the Company does not consider these securities to be other-than-temporarily impaired at September 30, 2015. Further, the Company believes any deterioration in value of its current investment securities is attributable to changes in market interest rates and not credit quality of the issuer.
| | | Less Than Twelve Months | | Twelve Months or More | | Total | | | | | Gross | | | | Gross | | | | Gross | | | | | | | Unrealized | | | | Unrealized | | | | Unrealized | | | | | | | Losses | | Fair Value | | Losses | | Fair Value | | Losses | | Fair Value | | | | | (In Thousands) | | | September 30, 2015 | | | | | | | | | | | | | | | | | | | | | U.S. Treasury and government sponsored agencies | | $ | (71) | | $ | 3,939 | | $ | - | | $ | - | | $ | (71) | | $ | 3,939 | | | Mortgage-backed securities | | | (44) | | | 2,625 | | | (259) | | | 13,441 | | | (303) | | | 16,066 | | | State and municipal securities | | | (53) | | | 12,651 | | | (45) | | | 4,403 | | | (98) | | | 17,054 | | | Corporate debt | | | - | | | - | | | - | | | - | | | - | | | - | | | Total | | $ | (168) | | $ | 19,215 | | $ | (304) | | $ | 17,844 | | $ | (472) | | $ | 37,059 | | | | | | | | | | | | | | | | | | | | | | | | December 31, 2014 | | | | | | | | | | | | | | | | | | | | | U.S. Treasury and government sponsored agencies | | $ | - | | $ | - | | $ | - | | $ | - | | $ | - | | $ | - | | | Mortgage-backed securities | | | - | | | - | | | (331) | | | 17,751 | | | (331) | | | 17,751 | | | State and municipal securities | | | (162) | | | 19,945 | | | (166) | | | 10,820 | | | (328) | | | 30,765 | | | Corporate debt | | | - | | | - | | | - | | | - | | | - | | | - | | | Total | | $ | (162) | | $ | 19,945 | | $ | (497) | | $ | 28,571 | | $ | (659) | | $ | 48,516 | |
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