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Investment Securities | 6 Months Ended
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Jun. 30, 2018
Investments, Debt and Equity Securities [Abstract] |
Investment Securities | Investment Securities The amortized cost, gross unrealized gains and losses and estimated fair values for available-for-sale and held-to-maturity securities by major security type at June 30, 2018 and December 31, 2017 were as follows (in thousands):
| Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized (Losses) |  | Fair Value
June 30, 2018 |  |  |  |  |  |  |
Available-for-sale: |  |  |  |  |  |  |
U.S. Treasury securities and obligations of U.S. government corporations & agencies | $ | 127,342 |  |  | $ | — |  |  | $ | (4,304 | ) |  | $ | 123,038 |
Obligations of states and political subdivisions | 176,376 |  |  | 1,064 |  |  | (2,200 | ) |  | 175,240 |
Mortgage-backed securities: GSE residential | 323,238 |  |  | 359 |  |  | (7,926 | ) |  | 315,671 |
Trust preferred securities | — |  |  | — |  |  | — |  |  | — |
Other securities | 2,187 |  |  | 167 |  |  | — |  |  | 2,354 |
Total available-for-sale | $ | 629,143 |  |  | $ | 1,590 |  |  | $ | (14,430 | ) |  | $ | 616,303 |
Held-to-maturity: |  |  |  |  |  |  |
U.S. Treasury securities and obligations of U.S. government corporations & agencies | $ | 69,383 |  |  | $ | — |  |  | $ | (1,858 | ) |  | $ | 67,525 |
December 31, 2017 |  |  |  |  |  |  |
Available-for-sale: |  |  |  |  |  |  |
U.S. Treasury securities and obligations of U.S. government corporations & agencies | $ | 115,796 |  |  | $ | 8 |  |  | $ | (2,034 | ) |  | $ | 113,770 |
Obligations of states and political subdivisions | 165,037 |  |  | 2,254 |  |  | (1,025 | ) |  | 166,266 |
Mortgage-backed securities: GSE residential | 295,778 |  |  | 493 |  |  | (2,460 | ) |  | 293,811 |
Trust preferred securities | 2,893 |  |  | — |  |  | (345 | ) |  | 2,548 |
Other securities | 2,039 |  |  | 145 |  |  | — |  |  | 2,184 |
Total available-for-sale | $ | 581,543 |  |  | $ | 2,900 |  |  | $ | (5,864 | ) |  | $ | 578,579 |
Held-to-maturity: |  |  |  |  |  |  |
U.S. Treasury securities and obligations of U.S. government corporations & agencies | $ | 69,332 |  |  | $ | 103 |  |  | $ | (978 | ) |  | $ | 68,457 |
Trust preferred securities represents one trust preferred pooled security issued by First Tennessee Financial (“FTN”). This security was sold during the second quarter of 2018. Realized gains and losses resulting from sales of securities were as follows during the six months ended June 30, 2018 and 2017 (in thousands):
| Three months ended June 30, |  | Six months ended June 30,
| 2018 |  | 2017 |  | 2018 |  | 2017
Gross gains | $ | 921 |  |  | $ | 352 |  |  | $ | 941 |  |  | $ | 352 |
Gross losses | (40 | ) |  | (17 | ) |  | (40 | ) |  | (17 | )
The following table indicates the expected maturities of investment securities classified as available-for-sale presented at fair value, and held-to-maturity presented at amortized cost, at June 30, 2018 and the weighted average yield for each range of maturities (dollars in thousands):
| One year or less |  | After 1 through 5 years |  | After 5 through 10 years |  | After ten years |  | Total
Available-for-sale: |  |  |  |  |  |  |  |  |
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 85,405 |  |  | $ | 37,633 |  |  | $ | — |  |  | $ | — |  |  | $ | 123,038 |
Obligations of state and political subdivisions | 16,785 |  |  | 77,266 |  |  | 80,129 |  |  | 1,060 |  |  | 175,240 |
Mortgage-backed securities: GSE residential | — |  |  | 104,930 |  |  | 176,494 |  |  | 34,247 |  |  | 315,671 |
Trust preferred securities | — |  |  | — |  |  | — |  |  | — |  |  | — |
Other securities | — |  |  | 2,013 |  |  | — |  |  | 341 |  |  | 2,354 |
Total available-for-sale investments | $ | 102,190 |  |  | $ | 221,842 |  |  | $ | 256,623 |  |  | $ | 35,648 |  |  | $ | 616,303 |
Weighted average yield | 2.35 | % |  | 2.68 | % |  | 2.92 | % |  | 3.40 | % |  | 2.77 | %
Full tax-equivalent yield | 2.52 | % |  | 3.05 | % |  | 3.28 | % |  | 3.43 | % |  | 3.08 | %
Held to Maturity: |  |  |  |  |  |  |  |  |
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 39,994 |  |  | $ | 29,389 |  |  | $ | — |  |  | $ | — |  |  | $ | 69,383 |
Weighted average yield | 1.76 | % |  | 2.08 | % |  | — | % |  | — | % |  | 2.68 | %
Full tax-equivalent yield | 1.76 | % |  | 2.08 | % |  | — | % |  | — | % |  | 2.68 | %
The weighted average yields are calculated on the basis of the amortized cost and effective yields weighted for the scheduled maturity of each security. Tax-equivalent yields have been calculated using a 21% tax rate. With the exception of obligations of the U.S. Treasury and other U.S. government agencies and corporations, there were no investment securities of any single issuer, the book value of which exceeded 10% of stockholders' equity at June 30, 2018. Investment securities carried at approximately $492 million and $479 million at June 30, 2018 and December 31, 2017, respectively, were pledged to secure public deposits and repurchase agreements and for other purposes as permitted or required by law. The following table presents the aging of gross unrealized losses and fair value by investment category as of June 30, 2018 and December 31, 2017 (in thousands):
| Less than 12 months |  | 12 months or more |  | Total
| Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses
June 30, 2018 |  |  |  |  |  |  |  |  |  |  |
Available-for-sale: |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 74,660 |  |  | $ | (1,917 | ) |  | $ | 48,378 |  |  | $ | (2,387 | ) |  | $ | 123,038 |  |  | $ | (4,304 | )
Obligations of states and political subdivisions | 72,991 |  |  | (1,357 | ) |  | 14,936 |  |  | (843 | ) |  | 87,927 |  |  | (2,200 | )
Mortgage-backed securities: GSE residential | 211,083 |  |  | (4,680 | ) |  | 68,005 |  |  | (3,246 | ) |  | 279,088 |  |  | (7,926 | )
Total | $ | 358,734 |  |  | $ | (7,954 | ) |  | $ | 131,319 |  |  | $ | (6,476 | ) |  | $ | 490,053 |  |  | $ | (14,430 | )
Held-to-maturity: |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 29,438 |  |  | $ | (387 | ) |  | $ | 38,087 |  |  | $ | (1,471 | ) |  | $ | 67,525 |  |  | $ | (1,858 | )
December 31, 2017 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Available-for-sale: |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 58,584 |  |  | $ | (540 | ) |  | $ | 47,972 |  |  | $ | (1,494 | ) |  | $ | 106,556 |  |  | $ | (2,034 | )
Obligations of states and political subdivisions | 42,618 |  |  | (769 | ) |  | 9,267 |  |  | (256 | ) |  | 51,885 |  |  | (1,025 | )
Mortgage-backed securities: GSE residential | 187,949 |  |  | (1,942 | ) |  | 22,609 |  |  | (518 | ) |  | 210,558 |  |  | (2,460 | )
Trust preferred securities | — |  |  | — |  |  | 2,548 |  |  | (345 | ) |  | 2,548 |  |  | (345 | )
Total | $ | 289,151 |  |  | $ | (3,251 | ) |  | $ | 82,396 |  |  | $ | (2,613 | ) |  | $ | 371,547 |  |  | $ | (5,864 | )
Held-to-maturity: |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 34,101 |  |  | $ | (525 | ) |  | $ | 14,540 |  |  | $ | (453 | ) |  | $ | 48,641 |  |  | $ | (978 | )
U.S. Treasury Securities and Obligations of U.S. Government Corporations and Agencies. At June 30, 2018 there were twelve available-for sale U.S. Treasury securities and obligations of U.S. government corporations and agencies with a fair value of $48,378,000 and unrealized losses of $2,387,000 in a continuous unrealized loss position for twelve months or more. At December 31, 2017 , there were eleven available-for sale U.S. Treasury securities and obligations of U.S. government corporations and agencies with a fair value of $47,972,000 and unrealized losses of $1,494,000 in a continuous unrealized loss position for twelve months or more. At June 30, 2018 there were seven held-to-maturity U.S. Treasury securities and obligations of U.S. government corporations and agencies with a fair value of $38,087,000 and unrealized losses of $1,471,000 in a continuous unrealized loss position for twelve months or more. At December 31, 2017 there were seven held-to-maturity U.S. Treasury securities and obligations of U.S. government corporations and agencies with a fair value of $14,540,000 and unrealized losses of $453,000 in a continuous unrealized loss position for twelve months or more. Obligations of states and political subdivisions. At June 30, 2018 there were thirty-three obligations of states and political subdivisions with a fair value of $14,936,000 and unrealized losses of $843,000 in a continuous loss position for twelve months or more. At December 31, 2017, there were thirty-nine obligations of states and political subdivisions with a fair value of $9,267,000 and unrealized losses of $256,000 in a continuous unrealized loss position for twelve months or more. Mortgage-backed Securities: GSE Residential. At June 30, 2018 there were twenty-eight mortgage-backed securities with a fair value of $68,005,000 and unrealized losses of $3,246,000 in a continuous unrealized loss position for twelve months or more. At December 31, 2017, there were twenty-six mortgage-backed securities with a fair value of $22,609,000 and unrealized losses of $518,000 in a continuous unrealized loss position for twelve months or more. Trust Preferred Securities. At December 31, 2017, there was one trust preferred security with a fair value of $2,548,000 and unrealized loss of $345,000 in a continuous unrealized loss position for twelve months or more. The unrealized loss was primarily due to the long-term nature of the trust preferred security, a lack of demand or inactive market for the security, the impending change to the regulatory treatment of these securities, and concerns regarding the underlying financial institutions that have issued the trust preferred securities. The company sold this security during the second quarter of 2018. Other secu rities. At June 30, 2018 and December 31, 2017, there were no other securities in a continuous unrealized loss position for twelve months or more. The Company does not believe any other individual unrealized loss as of June 30, 2018 represents OTTI. However, given the continued disruption in the financial markets, the Company may be required to recognize OTTI losses in future periods with respect to its available for sale investment securities portfolio. The amount and timing of any additional OTTI will depend on the decline in the underlying cash flows of the securities. Should the impairment of any of these securities become other-than-temporary, the cost basis of the investment will be reduced and the resulting loss recognized in the period the other-than-temporary impairment is identified. Other-than-temporary Impairment. Upon acquisition of a security, the Company determines whether it is within the scope of the accounting guidance for investments in debt and equity securities or whether it must be evaluated for impairment under the accounting guidance for beneficial interests in securitized financial assets. If the Company determines that a given pooled trust preferred security position will be subject to a write-down or loss, the Company records the expected credit loss as a charge to earnings. Credit Losses Recognized on Investments. The following table provides information about the trust preferred security for which only a credit loss was recognized in income and other losses were recorded in other comprehensive income (loss) for the six months ended June 30, 2018 and 2017 (in thousands).
| Accumulated Credit Losses
| June 30, 2018 |  | June 30, 2017
Credit losses on trust preferred securities held |  |  |
Beginning of period | $ | 1,111 |  |  | $ | 1,111 |
Additions related to OTTI losses not previously recognized | — |  |  | — |
Reductions due to sales / (recoveries) | (1,111 | ) |  | — |
Reductions due to change in intent or likelihood of sale | — |  |  | — |
Additions related to increases in previously recognized OTTI losses | — |  |  | — |
Reductions due to increases in expected cash flows | — |  |  | — |
End of period | $ | — |  |  | $ | 1,111 |
On May 29, 2018 the Company sold its trust preferred security. This sale resulted in recovery of all of the book value of the security. The net proceeds exceeded the aggregate book value of these securities by approximately $846,000 and this amount was recorded as a security gain during the second quarter of 2018.

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