Investment securities available for sale
 9 Months Ended
Sep. 30, 2020
Investment securities available for sale  
Investment securities available for sale

Note 4 – Investment securities available for sale

The amortized cost and fair value of investment securities available for sale as of September 30, 2020  and December 31, 2019 are as follows (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    

 

 

    

Gross

    

Gross

    

    

 

 

 

Amortized

 

Unrealized

 

Unrealized

 

Fair

 

 

Cost

 

Gains

 

Losses

 

Value

September 30, 2020

 

 

  

 

 

  

 

 

  

 

 

  

U.S. Government agency obligations

 

$

10,354

 

$

125

 

$

 —

 

$

10,479

Mortgage-backed securities

 

 

17,338

 

 

670

 

 

(28)

 

 

17,980

Subordinated debt

 

 

8,003

 

 

29

 

 

(186)

 

 

7,846

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

35,695

 

$

824

 

$

(214)

 

$

36,305

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2019

 

 

  

 

 

  

 

 

  

 

 

  

U.S. Government agency obligations

 

$

14,797

 

$

57

 

$

(9)

 

$

14,845

Mortgage-backed securities

 

 

25,124

 

 

204

 

 

(26)

 

 

25,302

Subordinated debt

 

 

6,779

 

 

91

 

 

(80)

 

 

6,790

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

46,700

 

$

352

 

$

(115)

 

$

46,937

 

At September 30, 2020 and December 31, 2019, the Company had no investment securities pledged to secure borrowings from the Federal Home Loan Bank of Atlanta ("FHLB").

Gross realized gains and losses pertaining to available for sale securities are detailed as follows for the periods indicated (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30, 

 

September 30, 

 

    

2020

    

2019

    

2020

    

2019

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross realized gains

 

$

 —

 

$

 —

 

$

39

 

$

101

Gross realized losses

 

 

 —

 

 

 —

 

 

(27)

 

 

 —

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

 —

 

$

 —

 

$

12

 

$

101

 

The Company sold approximately $7,900,000 and $6,500,000 in the nine months ended September 30,2020 and 2019, respectively, of investment securities available for sale at a net gain of $12,000 in 2020 and $101,000 in 2019. The sales of these securities, which had fixed interest rates, allowed the Company to decrease its exposure to upward movement in interest rates that would result in unrealized losses being recognized in shareholders’ equity.

Investment securities available for sale that have an unrealized loss position at September 30, 2020 and December 31, 2019 are detailed below (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Securities in a loss

 

Securities in a loss

 

 

 

 

 

 

 

 

position for less than

 

position for more than

 

 

 

 

 

 

 

 

12 Months

 

12 Months

 

Total

 

    

Fair

    

Unrealized

    

Fair

    

Unrealized

    

Fair

    

Unrealized

 

 

Value

 

Losses

 

Value

 

Losses

 

Value

 

Losses

September 30, 2020

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

Mortgage-backed securities

 

 

2,073

 

 

(28)

 

 

 —

 

 

 —

 

 

2,073

 

 

(28)

Subordinated debt

 

 

5,166

 

 

(81)

 

 

901

 

 

(105)

 

 

6,067

 

 

(186)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

7,239

 

$

(109)

 

$

901

 

$

(105)

 

$

8,140

 

$

(214)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2019

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

U.S. Government agency obligations

 

$

2,001

 

$

(1)

 

$

5,368

 

$

(8)

 

$

7,369

 

$

(9)

Mortgage-backed securities

 

 

2,747

 

 

(26)

 

 

 —

 

 

 —

 

 

2,747

 

 

(26)

Subordinated debt

 

 

759

 

 

(6)

 

 
940

 

 

(74)

 

 

1,699

 

 

(80)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

5,507

 

$

(33)

 

$
6,308

 

$

(82)

 

$

11,815

 

$

(115)

 

As of September 30, 2020, there were eleven investments available for sale totaling $7,239,000 that were in a continuous loss position for less than twelve months and had an unrealized loss of $109,000. There were two investments available for sale totaling $901,000 that had been in a continuous loss position for more than 12 months and had an unrealized loss of $105,000.

All of the unrealized losses are attributable to movements in interest rates and not to credit deterioration.  Currently, the Company believes that it is probable that the Company will be able to collect all amounts due according to the contractual terms of the investments.  Because the decline in fair value is attributable to changes in interest rates and not to credit quality, and because it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity, the Company does not consider these investments to be other than temporarily impaired at September 30, 2020.

The amortized cost and estimated fair value of investment securities available for sale as of September 30, 2020, by contractual maturity, are as follows (in thousands):

 

 

 

 

 

 

 

 

 

    

Amortized

    

 

 

 

 

Cost

 

Fair Value

Less than one year

 

$

8,213

 

$

8,277

One to five years

 

 

359

 

 

365

Five to ten years

 

 

9,925

 

 

9,822

More than ten years

 

 

17,198

 

 

17,841

 

 

 

 

 

 

 

Total

 

$

35,695

 

$

36,305