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Note 4 - Debt and Equity Securities | 9 Months Ended
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Sep. 30, 2016
Notes to Financial Statements |
Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block] |
| 4. | Debt and Equity Securities
The Company’s investments in equity securities that have readily determinable fair values and all investments in debt securities are classified in one of the following three categories and accounted for accordingly: (1) trading securities, (2) securities available for sale and (3) securities held-to-maturity. The Company did not hold any trading securities at September 30, 2016 and December 31, 2015. Securities available for sale are recorded at fair value. Securities held-to-maturity are recorded at amortized cost. The following table summarizes the Company’s portfolio of securities held-to-maturity at September 30, 2016:
|  | Amortized Cost |  | Fair Value |  | Gross Unrealized Gains |  | Gross Unrealized Losses
|  | (In thousands)
Securites held-to-maturity: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Municipals |  | $ | 33,274 |  |  | $ | 33,410 |  |  | $ | 136 |  |  | $ | - |
Total |  | $ | 33,274 |  |  | $ | 33,410 |  |  | $ | 136 |  |  | $ | - |
The following table summarizes the Company’s portfolio of securities held-to-maturity at December 31, 2015:
|  | Amortized Cost |  | Fair Value |  | Gross Unrealized Gains |  | Gross Unrealized Losses
|  | (In thousands)
Securites held-to-maturity: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Municipals |  | $ | 6,180 |  |  | $ | 6,180 |  |  | $ | - |  |  | $ | - |
Total |  | $ | 6,180 |  |  | $ | 6,180 |  |  | $ | - |  |  | $ | - |
The following table summarizes the Company’s portfolio of securities available for sale at September 30, 2016:
|  | Amortized Cost |  | Fair Value |  | Gross Unrealized Gains |  | Gross Unrealized Losses
|  | (In thousands) |  |
Corporate |  | $ | 110,000 |  |  | $ | 104,011 |  |  | $ | 191 |  |  | $ | 6,180 |
Municipals |  |  | 125,667 |  |  |  | 130,380 |  |  |  | 4,713 |  |  |  | - |
Mutual funds |  |  | 21,658 |  |  |  | 21,658 |  |  |  | - |  |  |  | - |
Collateralized loan obligations |  |  | 101,660 |  |  |  | 102,572 |  |  |  | 920 |  |  |  | 8 |
Other |  |  | 7,193 |  |  |  | 7,191 |  |  |  | - |  |  |  | 2 |
Total other securities |  |  | 366,178 |  |  |  | 365,812 |  |  |  | 5,824 |  |  |  | 6,190 |
REMIC and CMO |  |  | 383,912 |  |  |  | 389,426 |  |  |  | 6,144 |  |  |  | 630 |
GNMA |  |  | 7,520 |  |  |  | 7,700 |  |  |  | 180 |  |  |  | - |
FNMA |  |  | 129,791 |  |  |  | 132,831 |  |  |  | 3,085 |  |  |  | 45 |
FHLMC |  |  | 14,802 |  |  |  | 15,110 |  |  |  | 308 |  |  |  | - |
Total mortgage-backed securities |  |  | 536,025 |  |  |  | 545,067 |  |  |  | 9,717 |  |  |  | 675 |
Total securities available for sale |  | $ | 902,203 |  |  | $ | 910,879 |  |  | $ | 15,541 |  |  | $ | 6,865 |
Mortgage-backed securities shown in the table above include one private issue collateralized mortgage obligation (“CMO”) that is collateralized by commercial real estate mortgages with an amortized cost and market value of $0.4 million at September 30, 2016. The following table summarizes the Company’s portfolio of securities available for sale at December 31, 2015:
|  | Amortized Cost |  | Fair Value |  | Gross Unrealized Gains |  | Gross Unrealized Losses
|  | (In thousands) |  |
Corporate |  | $ | 115,976 |  |  | $ | 111,674 |  |  | $ | 134 |  |  | $ | 4,436 |
Municipals |  |  | 127,696 |  |  |  | 131,583 |  |  |  | 3,887 |  |  |  | - |
Mutual funds |  |  | 21,290 |  |  |  | 21,290 |  |  |  | - |  |  |  | - |
Collateralized loan obligations |  |  | 53,225 |  |  |  | 52,898 |  |  |  | - |  |  |  | 327 |
Other |  |  | 7,214 |  |  |  | 7,212 |  |  |  | - |  |  |  | 2 |
Total other securities |  |  | 325,401 |  |  |  | 324,657 |  |  |  | 4,021 |  |  |  | 4,765 |
REMIC and CMO |  |  | 469,987 |  |  |  | 469,936 |  |  |  | 3,096 |  |  |  | 3,147 |
GNMA |  |  | 11,635 |  |  |  | 11,798 |  |  |  | 302 |  |  |  | 139 |
FNMA |  |  | 170,327 |  |  |  | 170,057 |  |  |  | 1,492 |  |  |  | 1,762 |
FHLMC |  |  | 16,961 |  |  |  | 16,949 |  |  |  | 87 |  |  |  | 99 |
Total mortgage-backed securities |  |  | 668,910 |  |  |  | 668,740 |  |  |  | 4,977 |  |  |  | 5,147 |
Total securities available for sale |  | $ | 994,311 |  |  | $ | 993,397 |  |  | $ | 8,998 |  |  | $ | 9,912 |
Mortgage-backed securities shown in the table above include one private issue CMO that is collateralized by commercial real estate mortgages with an amortized cost and market value of $7.7 million at December 31, 2015. The following table details the amortized cost and fair value of the Company’s securities classified as held-to-maturity at September 30, 2016, by contractual maturity. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.
|  | Amortized Cost |  | Fair Value
|  | (In thousands)
Due in one year or less |  | $ | 11,370 |  |  | $ | 11,370 |
Due after one year through five years |  |  | 40 |  |  |  | 40 |
Due after ten years |  |  | 21,864 |  |  |  | 22,000 |
Total securities held-to-maturity |  | $ | 33,274 |  |  | $ | 33,410 |
The amortized cost and fair value of the Company’s securities, classified as available for sale at September 30, 2016, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.
|  | Amortized Cost |  | Fair Value
|  | (In thousands)
Due in one year or less |  | $ | - |  |  | $ | - |
Due after one year through five years |  |  | 1,795 |  |  |  | 1,821 |
Due after five years through ten years |  |  | 118,691 |  |  |  | 117,707 |
Due after ten years |  |  | 224,034 |  |  |  | 224,626 |
Total other securities |  |  | 344,520 |  |  |  | 344,154 |
Mutual funds |  |  | 21,658 |  |  |  | 21,658 |
Mortgage-backed securities |  |  | 536,025 |  |  |  | 545,067 |
Total securities available for sale |  | $ | 902,203 |  |  | $ | 910,879 |
The following table shows the Company’s available for sale securities with gross unrealized losses and their fair value, aggregated by category and length of time that individual securities have been in a continuous unrealized loss position, at September 30, 2016:
|  |  |  | Total |  | Less than 12 months |  | 12 months or more
|  | Count |  | Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses
|  |  |  | (Dollars in thousands) |  |
Corporate |  |  | 13 |  |  | $ | 93,820 |  |  | $ | 6,180 |  |  | $ | 19,294 |  |  | $ | 706 |  |  | $ | 74,526 |  |  | $ | 5,474 |
Collateralized loan obligations |  |  | 1 |  |  |  | 7,474 |  |  |  | 8 |  |  |  | - |  |  |  | - |  |  |  | 7,474 |  |  |  | 8 |
Other |  |  | 1 |  |  |  | 299 |  |  |  | 2 |  |  |  | - |  |  |  | - |  |  |  | 299 |  |  |  | 2 |
Total other securities |  |  | 15 |  |  |  | 101,593 |  |  |  | 6,190 |  |  |  | 19,294 |  |  |  | 706 |  |  |  | 82,299 |  |  |  | 5,484 |
REMIC and CMO |  |  | 11 |  |  |  | 55,603 |  |  |  | 630 |  |  |  | 19,707 |  |  |  | 131 |  |  |  | 35,896 |  |  |  | 499 |
FNMA |  |  | 1 |  |  |  | 6,694 |  |  |  | 45 |  |  |  | - |  |  |  | - |  |  |  | 6,694 |  |  |  | 45 |
Total mortgage-backed securities |  |  | 12 |  |  |  | 62,297 |  |  |  | 675 |  |  |  | 19,707 |  |  |  | 131 |  |  |  | 42,590 |  |  |  | 544 |
Total securities available for sale |  |  | 27 |  |  | $ | 163,890 |  |  | $ | 6,865 |  |  | $ | 39,001 |  |  | $ | 837 |  |  | $ | 124,889 |  |  | $ | 6,028 |
The following table shows the Company’s available for sale securities with gross unrealized losses and their fair value, aggregated by category and length of time that individual securities have been in a continuous unrealized loss position, at December 31, 2015:
|  |  |  | Total |  | Less than 12 months |  | 12 months or more
|  | Count |  | Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses
|  |  |  | (Dollars in thousands) |  |
Corporate |  |  | 12 |  |  | $ | 85,563 |  |  | $ | 4,436 |  |  | $ | 76,218 |  |  | $ | 3,782 |  |  | $ | 9,345 |  |  | $ | 654 |
Collateralized loan obligations |  |  | 7 |  |  |  | 52,898 |  |  |  | 327 |  |  |  | 52,898 |  |  |  | 327 |  |  |  | - |  |  |  | - |
Other |  |  | 1 |  |  |  | 298 |  |  |  | 2 |  |  |  | - |  |  |  | - |  |  |  | 298 |  |  |  | 2 |
Total other securities |  |  | 20 |  |  |  | 138,759 |  |  |  | 4,765 |  |  |  | 129,116 |  |  |  | 4,109 |  |  |  | 9,643 |  |  |  | 656 |
REMIC and CMO |  |  | 33 |  |  |  | 238,132 |  |  |  | 3,147 |  |  |  | 182,010 |  |  |  | 1,642 |  |  |  | 56,122 |  |  |  | 1,505 |
GNMA |  |  | 1 |  |  |  | 6,977 |  |  |  | 139 |  |  |  | 6,977 |  |  |  | 139 |  |  |  | - |  |  |  | - |
FNMA |  |  | 20 |  |  |  | 102,225 |  |  |  | 1,762 |  |  |  | 75,769 |  |  |  | 1,043 |  |  |  | 26,456 |  |  |  | 719 |
FHLMC |  |  | 3 |  |  |  | 14,715 |  |  |  | 99 |  |  |  | 14,715 |  |  |  | 99 |  |  |  | - |  |  |  | - |
Total mortgage-backed securities |  |  | 57 |  |  |  | 362,049 |  |  |  | 5,147 |  |  |  | 279,471 |  |  |  | 2,923 |  |  |  | 82,578 |  |  |  | 2,224 |
Total securities available for sale |  |  | 77 |  |  | $ | 500,808 |  |  | $ | 9,912 |  |  | $ | 408,587 |  |  | $ | 7,032 |  |  | $ | 92,221 |  |  | $ | 2,880 |
OTTI losses on impaired securities must be fully recognized in earnings if an investor has the intent to sell the debt security or if it is more likely than not that the investor will be required to sell the debt security before recovery of its amortized cost. However, even if an investor does not expect to sell a debt security, the investor must evaluate the expected cash flows to be received and determine if a credit loss has occurred. In the event that a credit loss has occurred, only the amount of impairment associated with the credit loss is recognized in earnings in the Consolidated Statements of Income. Amounts relating to factors other than credit losses are recorded in accumulated other comprehensive income (“AOCI”) within Stockholders’ Equity. The Company reviewed each investment that had an unrealized loss at September 30, 2016 and December 31, 2015. An unrealized loss exists when the current fair value of an investment is less than its amortized cost basis. Unrealized losses on available for sale securities, that are deemed to be temporary, are recorded in AOCI, net of tax. The unrealized losses in total securities available for sale at September 30, 2016 and December 31, 2015 were caused by movements in interest rates. It is not anticipated that these securities would be settled at a price that is less than the amortized cost of the Company’s investment. Each of these securities is performing according to its terms and, in the opinion of management, will continue to perform according to its terms. The Company does not have the intent to sell these securities and it is more likely than not the Company will not be required to sell the securities before recovery of the securities’ amortized cost basis. This conclusion is based upon considering the Company’s cash and working capital requirements and contractual and regulatory obligations, none of which the Company believes would cause the sale of the securities. Therefore, the Company did not consider these investments to be other-than-temporarily impaired at September 30, 2016 and December 31, 2015. The Company sold available for sale securities with book values at the time of sale totaling $64.6 million and $163.0 million during the nine months ended September 30, 2016 and 2015, respectively. The Company did not sell any available for sale securities during the three months ended September 30, 2016. The Company sold available for sale securities with book values at the time of sale totaling $138.0 million during the three months ended September 30, 2015. The following table represents the gross gains and gross losses realized from the sale of securities available for sale for the periods indicated:
|  | For the three months ended September 30, |  | For the nine months ended September 30,
|  | 2016 |  | 2015 |  | 2016 |  | 2015
|  | (In thousands)
Gross gains from the sale of securities |  | $ | - |  |  | $ | 2,666 |  |  | $ | 2,370 |  |  | $ | 2,899 |
Gross losses from the sale of securities |  |  | - |  |  |  | (2,563 | ) |  |  | (7 | ) |  |  | (2,732 | )
Net gains from the sale of securities |  | $ | - |  |  | $ | 103 |  |  | $ | 2,363 |  |  | $ | 167 |

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