Capital City Bank Group, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

INVESTMENT SECURITIES

INVESTMENT SECURITIES	3 Months Ended
INVESTMENT SECURITIES	Mar. 31, 2022
Investments Securities [Abstract]
Investment securities	NOTE 2 – INVESTMENT SECURITIES Investment Portfolio Composition . The following table summarizes the amortized cost and related fair value securities available-for-sale and securities held-to-maturity and the corresponding amounts of gross Available for Sale Amortized Unrealized Unrealized Allowance for Fair (Dollars in Thousands) Cost Gains Losses Credit Losses Value March 31, 2022 U.S. Government Treasury $ 190,049 $ 15 $ 10,051 $ - $ 180,013 U.S. Government Agency 232,067 547 8,179 - 224,435 States and Political Subdivisions 47,107 11 3,753 (15) 43,350 Mortgage-Backed Securities (1) 91,169 15 5,121 - 86,063 Corporate Debt Securities 88,208 4 5,018 (21) 83,173 Other Securities (2) 7,327 - - - 7,327 Total $ 655,927 $ 592 $ 32,122 $ (36) $ 624,361 December 31, 2021 U.S. Government Treasury $ 190,409 $ 65 $ 2,606 $ - $ 187,868 U.S. Government Agency 238,490 1,229 2,141 - 237,578 States and Political Subdivisions 47,762 44 811 (15) 46,980 Mortgage-Backed Securities (1) 89,440 27 598 - 88,869 Corporate Debt Securities 87,537 10 1,304 (21) 86,222 Other Securities (2) 7,094 - - - 7,094 Total $ 660,732 $ 1,375 $ 7,460 $ (36) $ 654,611 Held to Maturity Amortized Unrealized Unrealized Fair (Dollars in Thousands) Cost Gains Losses Value March 31, 2022 U.S. Government Treasury $ 289,237 $ 10 $ 9,355 $ 279,892 Mortgage-Backed Securities (1) 229,441 414 8,470 221,385 Total $ 518,678 $ 424 $ 17,825 $ 501,277 December 31, 2021 U.S. Government Treasury $ 115,499 $ - $ 1,622 $ 113,877 Mortgage-Backed Securities (1) 224,102 2,819 1,099 225,822 Total $ 339,601 $ 2,819 $ 2,721 $ 339,699 (1) Comprised of residential mortgage-backed securities (2) Includes Federal Home Loan Bank and Federal Reserve Bank stock, recorded at cost of $ 2.3 million and $ 5.1 million, respectively, at March 31, 2022 and $ 2.0 million and $ 5.1 million, respectively, at December 31, 2021. At March 31, 2022, the investment portfolio had $ 0.9 million in equity securities. These securities do not have a readily determinable fair value and were not credit impaired. Securities with an amortized cost of $ 453.3 million and $ 463.8 million at March 31, 2022 and December 31, 2021, respectively, were pledged to secure public deposits and for other purposes. The Bank, as a member of the Federal Home Loan Bank of Atlanta (“FHLB”), is required to own capital stock in the FHLB based generally upon the balances of residential and commercial real estate loans and FHLB advances. FHLB stock, which is included in other securities, is pledged to secure FHLB advances. No ready market exists for this stock, and it has no quoted fair value; however, redemption of this stock has historically been at par value. As a member of the Federal Reserve Bank of Atlanta, the Bank is required to maintain stock in the Federal Reserve Bank of Atlanta based on a specified ratio relative to the Bank’s capital. Federal Reserve Bank stock is carried at cost. Investment Sales. There were sales of investment securities totaling $ 3.4 million for the three months ended March 31, 2022. There were no significant sales of investment securities for the three months ended December 31, 2021 and March 31, 2021. Maturity Distribution . At March 31, 2022, the Company's investment securities had the following maturity distribution based on contractual maturity. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations. Mortgage-backed securities and certain amortizing U.S. government agency securities are shown separately because they are not due at a certain maturity date. Available for Sale Held to Maturity (Dollars in Thousands) Amortized Cost Fair Value Amortized Cost Fair Value Due in one year or less $ 36,321 $ 34,519 $ - $ - Due after one year through five years 306,432 290,613 289,237 279,892 Due after five year through ten years 62,103 56,445 - - Mortgage-Backed Securities 91,169 86,063 229,441 221,385 U.S. Government Agency 152,575 149,394 - - Equity Securities 7,327 7,327 - - Total $ 655,927 $ 624,361 $ 518,678 $ 501,277 Unrealized Losses on Investment Securities. The following table summarizes the available for sale investment securities with unrealized losses aggregated by major security type and length of time in a continuous unrealized loss position: Less Than Greater Than 12 Months 12 Months Total Fair Unrealized Fair Unrealized Fair Unrealized (Dollars in Thousands) Value Losses Value Losses Value Losses March 31, 2022 Available for Sale U.S. Government Treasury $ 117,369 $ 6,723 $ 57,638 $ 3,328 $ 175,007 $ 10,051 U.S. Government Agency 122,572 5,952 43,637 2,227 166,209 8,179 States and Political Subdivisions 42,181 3,719 444 34 42,625 3,753 Mortgage-Backed Securities 85,848 5,121 - - 85,848 5,121 Corporate Debt Securities 79,718 5,018 - - 79,718 5,018 Total 447,688 26,533 101,719 5,589 549,407 32,122 Held to Maturity U.S. Government Treasury 261,362 9,355 - - 261,362 9,355 Mortgage-Backed Securities 166,472 7,633 10,496 837 176,968 8,470 Total $ 427,834 $ 16,988 $ 10,496 $ 837 $ 438,330 $ 17,825 December 31, 2021 Available for Sale U.S. Government Treasury $ 172,206 $ 2,606 $ - $ - $ 172,206 $ 2,606 U.S. Government Agency 127,484 1,786 17,986 355 145,470 2,141 States and Political Subdivisions 42,122 811 - - 42,122 811 Mortgage-Backed Securities 81,832 598 - - 81,832 598 Corporate Debt Securities 69,354 1,304 - - 69,354 1,304 Total $ 492,998 $ 7,105 $ 17,986 $ 355 $ 510,984 $ 7,460 Held to Maturity U.S. Government Treasury 113,877 1,622 - - 113,877 1,622 Mortgage-Backed Securities 115,015 1,099 - - 115,015 1,099 Total $ 228,892 $ 2,721 $ - $ - $ 228,892 $ 2,721 At March 31, 2022, there were 673 positions (combined Available-for-Sale and Held-to-Maturity) with unrealized losses totaling $ 49.9 million. 553 of these positions were U.S. government agency securities issued by U.S. government sponsored entities. Municipal securities totaled 48 positions. The remaining 72 positions were corporate debt and asset backed securities. These investment securities had allowance for credit losses totaling less than $ 0.1 million at March 31, 2022. The declines in the fair values of these securities were attributable to changes in interest rates and not credit quality. Credit Quality Indicators The Company monitors the credit quality of its investment securities through various risk management procedures, including the monitoring of credit ratings. A majority of the debt securities in the Company’s investment portfolio were issued by a U.S. government entity or agency and are either explicitly or implicitly guaranteed by the U.S. government. The Company believes the long history of no credit losses on these securities indicates that the expectation of nonpayment of the amortized cost basis is zero, even if the U.S. government were to technically default. Further, certain municipal securities held by the Company have been pre- refunded and secured by government guaranteed treasuries. Therefore, for the aforementioned securities, the Company does not assess or record expected credit losses due to the zero loss assumption. The Company monitors the credit quality of its municipal and corporate securities portfolio via credit ratings which are updated on a quarterly basis. On a quarterly basis, municipal and corporate securities in an unrealized loss position are evaluated to determine if the loss is attributable to credit related factors and if an allowance for credit loss is needed.