XML 25 R14.htm IDEA: XBRL DOCUMENT
v3.10.0.1

Available-For-Sale And Held-To-Maturity Securities | 6 Months Ended
--- | ---
Jun. 30, 2018
Investments Debt And Equity Securities [Abstract] |
Available-For-Sale And Held-To-Maturity Securities | NOTE 6 – Available-for-Sale and Held-to-Maturity Securities The following tables provide a summary of the amortized cost and fair values of the available-for-sale securities and held-to-maturity securities at June 30, 2018 and December 31, 2017 (in thousands):
|  | June 30, 2018 |
|  | Amortized Cost |  |  | Gross Unrealized Gains (1) |  |  | Gross Unrealized Losses (1) |  |  | Estimated Fair Value |
Available-for-sale securities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. government agency securities |  | $ | 5,106 |  |  | $ | 1 |  |  | $ | (58 | ) |  | $ | 5,049 |
State and municipal securities |  |  | 73,669 |  |  | — |  |  |  | (4,208 | ) |  |  | 69,461 |
Mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Agency |  |  | 266,175 |  |  |  | 30 |  |  |  | (4,962 | ) |  |  | 261,243 |
Commercial |  |  | 74,979 |  |  |  | 12 |  |  |  | (5,511 | ) |  |  | 69,480 |
Non-agency |  |  | 1,383 |  |  |  | 23 |  |  | — |  |  |  | 1,406 |
Corporate fixed income securities |  |  | 1,297,026 |  |  |  | 1,632 |  |  |  | (28,042 | ) |  |  | 1,270,616 |
Asset-backed securities |  |  | 1,795,759 |  |  |  | 7,277 |  |  |  | (4,855 | ) |  |  | 1,798,181 |
|  | $ | 3,514,097 |  |  | $ | 8,975 |  |  | $ | (47,636 | ) |  | $ | 3,475,436 |
Held-to-maturity securities (2) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Agency |  | $ | 1,300,376 |  |  | $ | 215 |  |  | $ | (39,414 | ) |  | $ | 1,261,177 |
Commercial |  |  | 57,734 |  |  |  | — |  |  |  | (112 | ) |  |  | 57,622 |
Asset-backed securities |  |  | 3,161,875 |  |  |  | 6,045 |  |  |  | (8,320 | ) |  |  | 3,159,600 |
|  | $ | 4,519,985 |  |  | $ | 6,260 |  |  | $ | (47,846 | ) |  | $ | 4,478,399 |
|  | December 31, 2017 |
|  | Amortized Cost |  |  | Gross Unrealized Gains (1) |  |  | Gross Unrealized Losses (1) |  |  | Estimated Fair Value |
Available-for-sale securities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. government agency securities |  | $ | 5,022 |  |  | $ | — |  |  | $ | (39 | ) |  | $ | 4,983 |
State and municipal securities |  |  | 74,691 |  |  |  | — |  |  |  | (4,132 | ) |  |  | 70,559 |
Mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Agency |  |  | 308,409 |  |  |  | 102 |  |  |  | (2,981 | ) |  |  | 305,530 |
Commercial |  |  | 75,548 |  |  |  | 28 |  |  |  | (3,088 | ) |  |  | 72,488 |
Non-agency |  |  | 1,568 |  |  |  | — |  |  |  | — |  |  |  | 1,568 |
Corporate fixed income securities |  |  | 1,213,262 |  |  |  | 3,832 |  |  |  | (5,652 | ) |  |  | 1,211,442 |
Asset-backed securities |  |  | 2,098,958 |  |  |  | 12,877 |  |  |  | (4,897 | ) |  |  | 2,106,938 |
|  | $ | 3,777,458 |  |  | $ | 16,839 |  |  | $ | (20,789 | ) |  | $ | 3,773,508 |
Held-to-maturity securities (2) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Agency |  | $ | 1,334,833 |  |  | $ | 13,621 |  |  | $ | (16,208 | ) |  | $ | 1,332,246 |
Commercial |  |  | 58,971 |  |  |  | 1,313 |  |  |  | — |  |  |  | 60,284 |
Asset-backed securities |  |  | 2,264,283 |  |  |  | 15,526 |  |  |  | (1,862 | ) |  |  | 2,277,947 |
Corporate fixed income securities |  |  | 40,011 |  |  |  | 27 |  |  |  | (37 | ) |  |  | 40,001 |
|  | $ | 3,698,098 |  |  | $ | 30,487 |  |  | $ | (18,107 | ) |  | $ | 3,710,478 |
(1) | Unrealized gains/(losses) related to available-for-sale securities are reported in accumulated other comprehensive loss.
(2) | Held-to-maturity securities are carried in the consolidated statements of financial condition at amortized cost, and the changes in the value of these securities, other than impairment charges, are not reported on the consolidated financial statements.
There were no sales of available-for-sale securities during the six months ended June 30, 2018. For the three and six months ended June 30, 2017, we received proceeds of $87.3 million from the sale of available-for-sale securities, which resulted in realized gains of $0.4 million. During the three months ended June 30, 2018 and June 30, 2017, unrealized losses, net of deferred taxes, of $11.9 million and unrealized gains, net of deferred taxes of $3.8 million were recorded in accumulated other comprehensive loss in the consolidated statements of financial condition. During the six months ended June 30, 2018 and June 30, 2017, unrealized losses, net of deferred taxes, of $24.9 million and unrealized gains, net of deferred taxes, of $7.5 million were recorded in accumulated other comprehensive loss in the consolidated statements of financial condition. The table below summarizes the amortized cost and fair values of debt securities by contractual maturity. Expected maturities may differ significantly from contractual maturities, as issuers may have the right to call or prepay obligations with or without call or prepayment penalties.
|  | June 30, 2018 |
|  | Available-for-sale securities |  |  | Held-to-maturity securities |
|  | Amortized Cost |  |  | Estimated Fair Value |  |  | Amortized Cost |  |  | Estimated Fair Value |
Debt securities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Within one year |  | $ | 76,821 |  |  | $ | 76,617 |  |  | $ | — |  |  | $ | — |
After one year through three years |  |  | 344,701 |  |  |  | 338,138 |  |  | — |  |  | — |
After three years through five years |  |  | 316,001 |  |  |  | 308,923 |  |  | — |  |  | — |
After five years through ten years |  |  | 802,601 |  |  |  | 789,543 |  |  |  | 526,011 |  |  |  | 526,945 |
After ten years |  |  | 1,631,436 |  |  |  | 1,630,086 |  |  |  | 2,635,864 |  |  |  | 2,632,655 |
Mortgage-backed securities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
After three years through five years |  | — |  |  | — |  |  |  | 57,734 |  |  |  | 57,622 |
After five years through ten years |  |  | 1,007 |  |  |  | 966 |  |  |  | 192,248 |  |  |  | 186,159 |
After ten years |  |  | 341,530 |  |  |  | 331,163 |  |  |  | 1,108,128 |  |  |  | 1,075,018 |
|  | $ | 3,514,097 |  |  | $ | 3,475,436 |  |  | $ | 4,519,985 |  |  | $ | 4,478,399 |
The maturities of our available-for-sale (fair value) and held-to-maturity (amortized cost) securities at June 30, 2018, are as follows (in thousands):
|  | Within 1 Year |  |  | 1-5 Years |  |  | 5-10 Years |  |  | After 10 Years |  |  | Total |
Available-for-sale: (1) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. government agency securities |  | $ | 1,090 |  |  | $ | 3,959 |  |  | $ | — |  |  | $ | — |  |  | $ | 5,049 |
State and municipal securities |  |  | 354 |  |  |  | — |  |  |  | 18,444 |  |  |  | 50,663 |  |  |  | 69,461 |
Mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Agency |  |  | — |  |  |  | — |  |  |  | 966 |  |  |  | 260,277 |  |  |  | 261,243 |
Commercial |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 69,480 |  |  |  | 69,480 |
Non-agency |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 1,406 |  |  |  | 1,406 |
Corporate fixed income securities |  |  | 75,173 |  |  |  | 643,102 |  |  |  | 552,341 |  |  |  | — |  |  |  | 1,270,616 |
Asset-backed securities |  |  | — |  |  |  | — |  |  |  | 218,758 |  |  |  | 1,579,423 |  |  |  | 1,798,181 |
|  | $ | 76,617 |  |  | $ | 647,061 |  |  | $ | 790,509 |  |  | $ | 1,961,249 |  |  | $ | 3,475,436 |
Held-to-maturity: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Agency |  | $ | — |  |  | $ | — |  |  | $ | 192,248 |  |  | $ | 1,108,128 |  |  | $ | 1,300,376 |
Commercial |  |  | — |  |  |  | 57,734 |  |  |  | — |  |  |  | — |  |  |  | 57,734 |
Asset-backed securities |  |  | — |  |  |  | — |  |  |  | 526,011 |  |  |  | 2,635,864 |  |  |  | 3,161,875 |
|  | $ | — |  |  | $ | 57,734 |  |  | $ | 718,259 |  |  | $ | 3,743,992 |  |  | $ | 4,519,985 |
(1) | Due to the immaterial amount of income recognized on tax-exempt securities, yields were not calculated on a tax-equivalent basis.
At June 30, 2018 and December 31, 2017, securities of $2.1 billion and $2.2 billion, respectively, were pledged at the Federal Home Loan Bank as collateral for borrowings and letters of credit obtained to secure public deposits. At June 30, 2018 and December 31, 2017, securities of $2.3 billion and $2.0 billion, respectively, were pledged with the Federal Reserve discount window. The following table shows the gross unrealized losses and fair value of the Company’s investment securities with unrealized losses, aggregated by investment category and length of time the individual investment securities have been in continuous unrealized loss positions, at June 30, 2018 (in thousands):
|  | Less than 12 months |  |  | 12 months or more |  |  | Total |
|  | Gross Unrealized Losses |  |  | Estimated Fair Value |  |  | Gross Unrealized Losses |  |  | Estimated Fair Value |  |  | Gross Unrealized Losses |  |  | Estimated Fair Value |
Available-for-sale securities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. government securities |  | $ | (58 | ) |  | $ | 4,811 |  |  | $ | — |  |  | $ | — |  |  | $ | (58 | ) |  | $ | 4,811 |
State and municipal securities |  |  | (2 | ) |  |  | 354 |  |  |  | (4,206 | ) |  |  | 69,107 |  |  |  | (4,208 | ) |  |  | 69,461 |
Mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Agency |  |  | (2,328 | ) |  |  | 83,211 |  |  |  | (2,634 | ) |  |  | 156,268 |  |  |  | (4,962 | ) |  |  | 239,479 |
Commercial |  |  | — |  |  |  | — |  |  |  | (5,511 | ) |  |  | 68,386 |  |  |  | (5,511 | ) |  |  | 68,386 |
Corporate fixed income securities |  |  | (20,942 | ) |  |  | 775,896 |  |  |  | (7,100 | ) |  |  | 181,077 |  |  |  | (28,042 | ) |  |  | 956,973 |
Asset-backed securities |  |  | (4,855 | ) |  |  | 348,972 |  |  |  | — |  |  |  | — |  |  |  | (4,855 | ) |  |  | 348,972 |
|  | $ | (28,185 | ) |  | $ | 1,213,244 |  |  | $ | (19,451 | ) |  | $ | 474,838 |  |  | $ | (47,636 | ) |  | $ | 1,688,082 |
Held-to-maturity securities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Agency |  | $ | (7,590 | ) |  | $ | 488,456 |  |  | $ | (31,824 | ) |  | $ | 622,653 |  |  | $ | (39,414 | ) |  | $ | 1,111,109 |
Commercial |  |  | (112 | ) |  |  | 57,622 |  |  |  | — |  |  |  | — |  |  |  | (112 | ) |  |  | 57,622 |
Asset-backed securities |  |  | (5,962 | ) |  |  | 1,007,827 |  |  |  | (2,358 | ) |  |  | 37,121 |  |  |  | (8,320 | ) |  |  | 1,044,948 |
|  | $ | (13,664 | ) |  | $ | 1,553,905 |  |  | $ | (34,182 | ) |  | $ | 659,774 |  |  | $ | (47,846 | ) |  | $ | 2,213,679 |
At June 30, 2018, the amortized cost of 218 securities classified as available for sale exceeded their fair value by $47.6 million, of which $19.5 million related to investment securities that had been in a loss position for 12 months or longer. The total fair value of these investments at June 30, 2018, was $1.7 billion, which was 48.6% of our available-for-sale portfolio. At June 30, 2018, the carrying value of 116 securities held to maturity exceeded their fair value by $47.8 million, of which $34.2 million related to securities held to maturity that have been in a loss position for 12 months or longer. As discussed in more detail below, we conduct periodic reviews of all securities with unrealized losses to assess whether the impairment is other-than-temporary. Other-Than-Temporary Impairment We evaluate all securities in an unrealized loss position quarterly to assess whether the impairment is other-than-temporary. Our other-than-temporary impairment (“OTTI”) assessment is a subjective process requiring the use of judgments and assumptions. There was no credit-related OTTI recognized during the three and six months ended June 30, 2018 and 2017. We believe the gross unrealized losses of $95.5 million related to our investment portfolio, as of June 30, 2018, are attributable to issuer-specific credit spreads and changes in market interest rates and asset spreads. We, therefore, do not expect to incur any credit losses related to these securities. In addition, we have no intent to sell these securities with unrealized losses, and it is not more likely than not that we will be required to sell these securities prior to recovery of the amortized cost. Accordingly, we have concluded that the impairment on these securities is not other-than-temporary.

X
- References No definition available. + Details
Name: | us-gaap_InvestmentsDebtAndEquitySecuritiesAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for investments in certain debt and equity securities. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 320 -URI http://asc.fasb.org/subtopic&trid=2209399 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 946 -SubTopic 320 -URI http://asc.fasb.org/subtopic&trid=2324412 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -URI http://asc.fasb.org/topic&trid=2196928 Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 940 -SubTopic 320 -URI http://asc.fasb.org/subtopic&trid=2176304 + Details
Name: | us-gaap_InvestmentsInDebtAndMarketableEquitySecuritiesAndCertainTradingAssetsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration