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SECURITIES
 6 Months Ended
Mar. 31, 2016
SECURITIES [Abstract]  
SECURITIES
NOTE 5.
SECURITIES

The amortized cost, gross unrealized gains and losses and estimated fair values of available for sale and held to maturity securities at March 31, 2016 and September 30, 2015 are presented below.

Available For Sale
    
GROSS
  
GROSS
    
At March 31, 2016
 
AMORTIZED
COST
  
UNREALIZED
GAINS
  
UNREALIZED
(LOSSES)
  
FAIR
VALUE
 
  
(Dollars in Thousands)
 
Debt securities
            
Trust preferred securities
 
$
14,933
  
$
-
  
$
(2,985
)
 
$
11,948
 
Small business administration securities
  
81,823
   
1,874
   
-
   
83,697
 
Non-bank qualified obligations of states and political subdivisions
  
680,360
   
23,273
   
(398
)
  
703,235
 
Asset-backed securities
  
66,787
   
13
   
(634
)
  
66,166
 
Mortgage-backed securities
  
690,049
   
1,759
   
(2,856
)
  
688,952
 
Total debt securities
  
1,533,952
   
26,919
   
(6,873
)
  
1,553,998
 
Common equities and mutual funds
  
760
   
352
   
(6
)
  
1,106
 
Total available for sale securities
 
$
1,534,712
  
$
27,271
  
$
(6,879
)
 
$
1,555,104
 

At September 30, 2015
 
AMORTIZED
COST
  
GROSS
UNREALIZED
GAINS
  
GROSS
UNREALIZED
(LOSSES)
  
FAIR
VALUE
 
  
(Dollars in Thousands)
 
Debt securities
            
Trust preferred and corporate securities
 
$
16,199
  
$
8
  
$
(2,263
)
 
$
13,944
 
Small business administration securities
  
54,493
   
1,563
   
-
   
56,056
 
Non-bank qualified obligations of states and political subdivisions
  
603,165
   
7,240
   
(1,815
)
  
608,590
 
Mortgage-backed securities
  
580,165
   
1,283
   
(4,865
)
  
576,583
 
Total debt securities
  
1,254,022
   
10,094
   
(8,943
)
  
1,255,173
 
Common equities and mutual funds
  
639
   
283
   
(8
)
  
914
 
Total available for sale securities
 
$
1,254,661
  
$
10,377
  
$
(8,951
)
 
$
1,256,087
 

Held to Maturity
    
GROSS
  
GROSS
    
At March 31, 2016
 
AMORTIZED
COST
  
UNREALIZED
GAINS
  
UNREALIZED
(LOSSES)
  
FAIR
VALUE
 
 
 
(Dollars in Thousands)
 
Debt securities
            
Obligations of states and political subdivisions
 
$
20,791
  
$
238
  
$
(46
)
 
$
20,983
 
Non-bank qualified obligations of states and political subdivisions
  
396,480
   
7,540
   
(61
)
  
403,959
 
Mortgage-backed securities
  
68,497
   
30
   
(119
)
  
68,408
 
Total held to maturity securities
 
$
485,768
  
$
7,808
  
$
(226
)
 
$
493,350
 
 
At September 30, 2015
 
AMORTIZED
COST
  
GROSS
UNREALIZED
GAINS
  
GROSS
UNREALIZED
(LOSSES)
  
FAIR
VALUE
 
 
 
(Dollars in Thousands)
 
Debt securities
            
Obligations of states and political subdivisions
 
$
19,540
  
$
60
  
$
(187
)
 
$
19,413
 
Non-bank qualified obligations of states and political subdivisions
  
259,627
   
2,122
   
(419
)
  
261,330
 
Mortgage-backed securities
  
66,577
   
-
   
(473
)
  
66,104
 
Total held to maturity securities
 
$
345,744
  
$
2,182
  
$
(1,079
)
 
$
346,847
 

Included in securities available for sale are trust preferred securities as follows:

At March 31, 2016
          
 
     
Issuer(1)
 
Amortized Cost
  
Fair Value
  
Unrealized
Gain (Loss)
  
S&P
Credit Rating
Moody's
Credit Rating
  
(Dollars in Thousands)
  
 
  
           
 
      
Key Corp. Capital I
 
$
4,987
  
$
4,006
  
$
(981
)
 
BB+
Baa2
Huntington Capital Trust II SE
  
4,980
   
3,878
   
(1,102
)
 
BB
Baa2
PNC Capital Trust
  
4,966
   
4,064
   
(902
)
 
BBB-
Baa1
Total
 
$
14,933
  
$
11,948
  
$
(2,985
)
 
 
  
 
 
(1)
Trust preferred securities are single-issuance.  There are no known deferrals, defaults or excess subordination.

At September 30, 2015
          
 
     
Issuer(1)
 
Amortized Cost
  
Fair Value
  
Unrealized
Gain (Loss)
  
S&P
Credit Rating
Moody's
Credit Rating
  
(Dollars in Thousands)
  
 
  
           
 
      
Key Corp. Capital I
 
$
4,986
  
$
4,189
  
$
(797
)
 
BB+
Baa2
Huntington Capital Trust II SE
  
4,979
   
4,076
   
(903
)
 
BB
Baa2
PNC Capital Trust
  
4,965
   
4,402
   
(563
)
 
BBB-
Baa1
Total
 
$
14,930
  
$
12,667
  
$
(2,263
)
 
 
  
 
 
(1)
Trust preferred securities are single-issuance.  There are no known deferrals, defaults or excess subordination

Management has implemented a process to identify securities with potential credit impairment that are other-than-temporary.  This process involves evaluation of the length of time and extent to which the fair value has been less than the amortized cost basis, review of available information regarding the financial position of the issuer, monitoring the rating, watch, and outlook of the security, monitoring changes in value, cash flow projections, and the Company’s intent to sell a security or whether it is more likely than not we will be required to sell the security before the recovery of its amortized cost which, in some cases, may extend to maturity.  To the extent we determine that a security is deemed to be other-than-temporarily impaired, an impairment loss is recognized.
 
For all securities considered temporarily impaired, the Company does not intend to sell these securities and it is not more likely than not that the Company will be required to sell the security before recovery of its amortized cost, which may occur at maturity.  The Company believes it will collect all principal and interest due on all investments with amortized cost in excess of fair value and considered only temporarily impaired.

Generally accepted accounting principles require that, at acquisition, an enterprise classify debt securities into one of three categories: Available for sale (“AFS”), Held to Maturity (“HTM”) or trading. AFS securities are carried at fair value on the consolidated statements of financial condition, and unrealized holding gains and losses are excluded from earnings and recognized as a separate component of equity in accumulated other comprehensive income (“AOCI”). HTM debt securities are measured at amortized cost. Both AFS and HTM are subject to review for other-than-temporary impairment. The Company had no trading securities at March 31, 2016 and September 30, 2015.

Gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at March 31, 2016 and September 30, 2015, are as follows:

Available For Sale
 
LESS THAN 12 MONTHS
  
OVER 12 MONTHS
  
TOTAL
 
At March 31, 2016
 
Fair
Value
  
Unrealized
(Losses)
  
Fair
Value
  
Unrealized
(Losses)
  
Fair
Value
  
Unrealized
(Losses)
 
  
(Dollars in Thousands)
 
Debt securities
                  
Trust preferred securities
 
$
-
  
$
-
  
$
11,948
  
$
(2,985
)
 
$
11,948
  
$
(2,985
)
Non-bank qualified obligations of states and political subdivisions
  
22,208
   
(52
)
  
15,479
   
(346
)
  
37,687
   
(398
)
Asset-backed securities
  
50,116
   
(634
)
  
-
   
-
   
50,116
   
(634
)
Mortgage-backed securities
  
303,869
   
(1,821
)
  
144,547
   
(1,035
)
  
448,416
   
(2,856
)
Total debt securities
  
376,193
   
(2,507
)
  
171,974
   
(4,366
)
  
548,167
   
(6,873
)
Common equities and mutual funds
  
-
   
-
   
122
   
(6
)
  
122
   
(6
)
Total available for sale securities
 
$
376,193
  
$
(2,507
)
 
$
172,096
  
$
(4,372
)
 
$
548,289
  
$
(6,879
)

  
LESS THAN 12 MONTHS
  
OVER 12 MONTHS
  
TOTAL
 
At September 30, 2015
 
Fair
Value
  
Unrealized
(Losses)
  
Fair
Value
  
Unrealized
(Losses)
  
Fair
Value
  
Unrealized
(Losses)
 
  
(Dollars in Thousands)
 
Debt securities
                  
Trust preferred and corporate securities
 
$
-
  
$
-
  
$
12,667
  
$
(2,263
)
 
$
12,667
  
$
(2,263
)
Non-bank qualified obligations of states and political subdivisions
  
97,006
   
(860
)
  
42,583
   
(955
)
  
139,589
   
(1,815
)
Mortgage-backed securities
  
448,988
   
(4,301
)
  
48,079
   
(564
)
  
497,067
   
(4,865
)
Total debt securities
  
545,994
   
(5,161
)
  
103,329
   
(3,782
)
  
649,323
   
(8,943
)
Common equities and mutual funds
  
-
   
-
   
121
   
(8
)
  
121
   
(8
)
Total available for sale securities
 
$
545,994
  
$
(5,161
)
 
$
103,450
  
$
(3,790
)
 
$
649,444
  
$
(8,951
)

Held To Maturity
 
LESS THAN 12 MONTHS
  
OVER 12 MONTHS
  
TOTAL
 
At March 31, 2016
 
Fair
Value
  
Unrealized
(Losses)
  
Fair
Value
  
Unrealized
(Losses)
  
Fair
Value
  
Unrealized
(Losses)
 
 
 
(Dollars in Thousands)
 
Debt securities
                  
Obligations of states and political subdivisions
 
$
4,905
  
$
(16
)
 
$
2,486
  
$
(30
)
 
$
7,391
  
$
(46
)
Non-bank qualified obligations of states and political subdivisions
  
25,003
   
(56
)
  
422
   
(5
)
  
25,425
   
(61
)
Mortgage-backed securities
  
2,945
   
(10
)
  
56,954
   
(109
)
  
59,899
   
(119
)
Total held to maturity securities
 
$
32,853
  
$
(82
)
 
$
59,862
  
$
(144
)
 
$
92,715
  
$
(226
)
 
 
 
LESS THAN 12 MONTHS
  
OVER 12 MONTHS
  
TOTAL
 
At September 30, 2015
 
Fair
Value
  
Unrealized
(Losses)
  
Fair
Value
  
Unrealized
(Losses)
  
Fair Value
  
Unrealized
(Losses)
 
 
 
(Dollars in Thousands)
 
Debt securities
                  
Obligations of states and political subdivisions
 
$
5,528
  
$
(34
)
 
$
7,964
  
$
(153
)
 
$
13,492
  
$
(187
)
Non-bank qualified obligations of states and political subdivisions
  
78,663
   
(365
)
  
4,136
   
(54
)
  
82,799
   
(419
)
Mortgage-backed securities
  
5,509
   
(43
)
  
60,595
   
(430
)
  
66,104
   
(473
)
Total held to maturity securities
 
$
89,700
  
$
(442
)
 
$
72,695
  
$
(637
)
 
$
162,395
  
$
(1,079
)

At March 31, 2016, the investment portfolio included securities with current unrealized losses which have existed for longer than one year.  All of these securities are considered to be acceptable credit risks.  Because the declines in fair value were due to changes in market interest rates, not in estimated cash flows, and the Company does not intend to sell these securities (has not made a decision to sell) and it is not more likely than not that the Company will be required to sell the security before recovery of its amortized cost basis, which may occur at maturity, no other-than-temporary impairment was recorded at March 31, 2016.

The amortized cost and fair value of debt securities by contractual maturity are shown below.  Certain securities have call features which allow the issuer to call the security prior to maturity.  Expected maturities may differ from contractual maturities in mortgage-backed securities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.  Therefore, mortgage-backed securities are not included in the maturity categories in the following maturity summary.  The expected maturities of certain Small Business Administration and certain asset-backed securities may differ from contractual maturities because the borrowers may have the right to prepay the obligation. However, certain prepayment penalties may apply.

Available For Sale
 
AMORTIZED
COST
  
FAIR
VALUE
 
 
    
At March 31, 2016
 
(Dollars in Thousands)
 
 
      
Due in one year or less
 
$
-
  
$
-
 
Due after one year through five years
  
7,337
   
7,533
 
Due after five years through ten years
  
416,311
   
431,338
 
Due after ten years
  
420,255
   
426,175
 
 
  
843,903
   
865,046
 
Mortgage-backed securities
  
690,049
   
688,952
 
Common equities and mutual funds
  
760
   
1,106
 
Total available for sale securities
 
$
1,534,712
  
$
1,555,104
 
 
 
 
AMORTIZED
COST
  
FAIR
VALUE
 
At September 30, 2015
 
(Dollars in Thousands)
 
 
      
Due in one year or less
 
$
-
  
$
-
 
Due after one year through five years
  
1,174
   
1,207
 
Due after five years through ten years
  
370,087
   
376,394
 
Due after ten years
  
302,596
   
300,989
 
 
  
673,857
   
678,590
 
Mortgage-backed securities
  
580,165
   
576,583
 
Common equities and mutual funds
  
639
   
914
 
Total available for sale securities
 
$
1,254,661
  
$
1,256,087
 

Held To Maturity
 
AMORTIZED
COST
  
FAIR
VALUE
 
 
    
At March 31, 2016
 
(Dollars in Thousands)
 
 
      
Due in one year or less
 
$
225
  
$
225
 
Due after one year through five years
  
11,721
   
11,885
 
Due after five years through ten years
  
143,869
   
147,574
 
Due after ten years
  
261,456
   
265,258
 
 
  
417,271
   
424,942
 
Mortgage-backed securities
  
68,497
   
68,408
 
Total held to maturity securities
 
$
485,768
  
$
493,350
 

 
 
AMORTIZED
COST
  
FAIR
VALUE
 
At September 30, 2015
 
(Dollars in Thousands)
 
 
      
Due in one year or less
 
$
95
  
$
96
 
Due after one year through five years
  
8,411
   
8,430
 
Due after five years through ten years
  
140,145
   
140,505
 
Due after ten years
  
130,516
   
131,712
 
 
  
279,167
   
280,743
 
Mortgage-backed securities
  
66,577
   
66,104
 
Total held to maturity securities
 
$
345,744
  
$
346,847