XML 28 R12.htm IDEA: XBRL DOCUMENT
v3.10.0.1

Securities | 12 Months Ended
--- | ---
Dec. 31, 2018
Securities |
Securities | Note 4: Securities Investment Portfolio Management The following table summarizes the amortized cost and fair value of the securities portfolio at December 31, 2018 and December 31, 2017, and the corresponding amounts of gross unrealized gains and losses:
|  |  |  |  | Gross |  | Gross |  |  |
|  | Amortized |  | Unrealized |  | Unrealized |  | Fair
December 31, 2018 |  | Cost |  | Gains |  | Losses |  | Value
Securities available-for-sale |  |  |  |  |  |  |  |
U.S. Treasuries |  | $ | 4,006 |  | $ | - |  | $ | (83) |  | $ | 3,923
U.S. government agencies |  |  | 11,112 |  |  | - |  |  | (161) |  |  | 10,951
U.S. government agencies mortgage-backed |  |  | 14,407 |  |  | 45 |  |  | (377) |  |  | 14,075
States and political subdivisions |  |  | 277,112 |  |  | 1,916 |  |  | (4,961) |  |  | 274,067
Collateralized mortgage obligations |  |  | 66,494 |  |  | 79 |  |  | (2,144) |  |  | 64,429
Asset-backed securities |  |  | 108,574 |  |  | 1,165 |  |  | (225) |  |  | 109,514
Collateralized loan obligations |  |  | 65,162 |  |  | 24 |  |  | (897) |  |  | 64,289
Total securities available-for-sale |  | $ | 546,867 |  | $ | 3,229 |  | $ | (8,848) |  | $ | 541,248
|  |  |  |  | Gross |  | Gross |  |  |
|  | Amortized |  | Unrealized |  | Unrealized |  | Fair
December 31, 2017 |  | Cost |  | Gains |  | Losses |  | Value
Securities available-for-sale |  |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury |  | $ | 4,002 |  | $ | - |  | $ | (55) |  | $ | 3,947
U.S. government agencies |  |  | 13,062 |  |  | 8 |  |  | (9) |  |  | 13,061
U.S. government agencies mortgage-backed |  |  | 12,372 |  |  | 7 |  |  | (165) |  |  | 12,214
States and political subdivisions |  |  | 272,240 |  |  | 7,116 |  |  | (1,264) |  |  | 278,092
Corporate bonds |  |  | 823 |  |  | 21 |  |  | (11) |  |  | 833
Collateralized mortgage obligations |  |  | 66,892 |  |  | 202 |  |  | (1,155) |  |  | 65,939
Asset-backed securities |  |  | 113,983 |  |  | 862 |  |  | (1,913) |  |  | 112,932
Collateralized loan obligations |  |  | 54,271 |  |  | 251 |  |  | (101) |  |  | 54,421
Total securities available-for-sale |  | $ | 537,645 |  | $ | 8,467 |  | $ | (4,673) |  | $ | 541,439
Nonmarketable equity investments include FHLBC stock and FRBC stock. FHLBC stock was $7.2 million and $5.4 million at December 31, 2018 and December 31, 2017, respectively. FRBC stock was $6.2 million and $4.8 million at December 31, 2018 and December 31, 2017, respectively. Our FHLBC stock is necessary to maintain access to FHLBC advances. Securities valued at $318.4 million as of December 31, 2018, an increase from $301.0 million at year-end 2017, were pledged to secure deposits and borrowings, and for other purposes. The fair value, amortized cost and weighted average yield of debt securities at December 31, 2018, by contractual maturity, were as follows in the table below. Securities not due at a single maturity date are shown separately.
|  |  |  |  | Weighted |  |  |  |  |
|  | Amortized |  | Average |  |  | Fair |
Securities available-for-sale |  | Cost |  | Yield |  |  | Value |
Due in one year or less |  | $ | 494 |  | 0.56 | % |  | $ | 495 |
Due after one year through five years |  |  | 6,910 |  | 2.00 |  |  |  | 6,861 |
Due after five years through ten years |  |  | 6,202 |  | 3.25 |  |  |  | 6,275 |
Due after ten years |  |  | 278,624 |  | 3.02 |  |  |  | 275,310 |
|  |  | 292,230 |  | 2.99 |  |  |  | 288,941 |
Mortgage-backed and collateralized mortgage obligations |  |  | 80,901 |  | 3.24 |  |  |  | 78,504 |
Asset-backed securities |  |  | 108,574 |  | 3.65 |  |  |  | 109,514 |
Collateralized loan obligations |  |  | 65,162 |  | 5.05 |  |  |  | 64,289 |
Total securities available-for-sale |  | $ | 546,867 |  | 3.41 | % |  | $ | 541,248 |
At December 31, 2018, the Company’s investments include asset-backed securities totaling $93.1 million that are backed by student loans originated under the Federal Family Education Loan program (“FFEL”). Under the FFEL, private lenders made federally guaranteed student loans to parents and students. While the program was modified several times before elimination in 2010, FFEL securities are generally guaranteed by the U.S. Department of Education (“DOE”) at not less than 97% of the principal amount of the loans. The guarantee will reduce to 85% if the DOE receives reimbursement requests in excess of 5% of insured loans; reimbursement will drop to 75% if reimbursement requests exceed 9% of insured loans. As of December 31, 2018, the likelihood of the decrease in the government guarantee was minimal as the average rate of reimbursement for 2018 was less than 1.0%. The Company has accumulated the securities of the following three different originators that individually amount to over 10% of the Company’s stockholders equity. The amortized cost and fair value of securities related to these three issuers are as follows:
|  | December 31, 2018
|  | Amortized |  | Fair
Issuer |  | Cost |  | Value
GCO Education Loan Funding Corp |  | $ | 27,739 |  | $ | 27,763
Towd Point Mortgage Trust |  |  | 34,308 |  |  | 33,318
Student Loan Marketing Association (“SLMA”) |  |  | 25,808 |  |  | 26,119
Securities with unrealized losses at December 31, 2018, and December 31, 2017, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, were as follows:
|  | Less than 12 months |  | 12 months or more |  |  |  |  |  |  |  |
December 31, 2018 |  | in an unrealized loss position |  | in an unrealized loss position |  | Total
|  | Number of |  | Unrealized |  | Fair |  | Number of |  | Unrealized |  | Fair |  | Number of |  | Unrealized |  | Fair
Securities available-for-sale |  | Securities |  | Losses |  | Value |  | Securities |  | Losses |  | Value |  | Securities |  | Losses |  | Value
U.S. Treasuries |  | - |  | $ | - |  | $ | - |  | 1 |  | $ | 83 |  | $ | 3,923 |  | 1 |  | $ | 83 |  | $ | 3,923
U.S. government agencies |  | 3 |  |  | 100 |  |  | 7,385 |  | 1 |  |  | 61 |  |  | 3,566 |  | 4 |  |  | 161 |  |  | 10,951
U.S. government agencies mortgage-backed |  | - |  |  | - |  |  | - |  | 11 |  |  | 377 |  |  | 11,439 |  | 11 |  |  | 377 |  |  | 11,439
States and political subdivisions |  | 4 |  |  | 126 |  |  | 17,713 |  | 33 |  |  | 4,835 |  |  | 110,326 |  | 37 |  |  | 4,961 |  |  | 128,039
Collateralized mortgage obligations |  | 2 |  |  | 309 |  |  | 15,211 |  | 10 |  |  | 1,835 |  |  | 43,687 |  | 12 |  |  | 2,144 |  |  | 58,898
Asset-backed securities |  | - |  |  | - |  |  | - |  | 4 |  |  | 225 |  |  | 16,473 |  | 4 |  |  | 225 |  |  | 16,473
Collateralized loan obligations |  | 7 |  |  | 721 |  |  | 46,547 |  | 1 |  |  | 176 |  |  | 7,824 |  | 8 |  |  | 897 |  |  | 54,371
Total securities available-for-sale |  | 16 |  | $ | 1,256 |  | $ | 86,856 |  | 61 |  | $ | 7,592 |  | $ | 197,238 |  | 77 |  | $ | 8,848 |  | $ | 284,094
|  | Less than 12 months |  | 12 months or more |  |  |  |  |  |  |  |
December 31, 2017 |  | in an unrealized loss position |  | in an unrealized loss position |  | Total
|  | Number of |  | Unrealized |  |  | Fair |  | Number of |  | Unrealized |  |  | Fair |  | Number of |  | Unrealized |  |  | Fair
Securities available-for-sale |  | Securities |  | Losses |  |  | Value |  | Securities |  | Losses |  |  | Value |  | Securities |  | Losses |  |  | Value
U.S. Treasuries |  | 1 |  | $ | 55 |  | $ | 3,947 |  | - |  | $ | - |  | $ | - |  | 1 |  | $ | 55 |  | $ | 3,947
U.S. government agencies |  | 2 |  |  | 9 |  |  | 6,550 |  | - |  |  | - |  |  | - |  | 2 |  |  | 9 |  |  | 6,550
U.S. government agencies mortgage-backed |  | 4 |  |  | 24 |  |  | 5,501 |  | 5 |  |  | 141 |  |  | 4,843 |  | 9 |  |  | 165 |  |  | 10,344
States and political subdivisions |  | 13 |  |  | 1,237 |  |  | 45,985 |  | 1 |  |  | 27 |  |  | 1,512 |  | 14 |  |  | 1,264 |  |  | 47,497
Corporate bonds |  | - |  |  | - |  |  | - |  | 1 |  |  | 11 |  |  | 332 |  | 1 |  |  | 11 |  |  | 332
Collateralized mortgage obligations |  | 3 |  |  | 31 |  |  | 11,534 |  | 8 |  |  | 1,124 |  |  | 40,219 |  | 11 |  |  | 1,155 |  |  | 51,753
Asset-backed securities |  | - |  |  | - |  |  | - |  | 7 |  |  | 1,913 |  |  | 61,745 |  | 7 |  |  | 1,913 |  |  | 61,745
Collateralized loan obligations |  | 3 |  |  | 101 |  |  | 29,313 |  | - |  |  | - |  |  | - |  | 3 |  |  | 101 |  |  | 29,313
Total securities available-for-sale |  | 26 |  | $ | 1,457 |  | $ | 102,830 |  | 22 |  | $ | 3,216 |  | $ | 108,651 |  | 48 |  | $ | 4,673 |  | $ | 211,481
Recognition of other-than-temporary impairment was not necessary in the year ended December 31, 2018, or the year ended December 31, 2017. The changes in fair value related primarily to interest rate fluctuations. The Company’s review of other-than-temporary impairment confirmed no credit quality deterioration. The following table presents net realized gains (losses) on securities available-for-sale for the years ended:
|  |  | Years ended December 31, |
Securities available-for-sale |  |  | 2018 |  | 2017 |  | 2016 |
Proceeds from sales of securities |  |  | $ | 94,663 |  | $ | 232,462 |  | $ | 306,400 |
Gross realized gains on securities |  |  |  | 369 |  |  | 2,367 |  |  | 1,675 |
Gross realized losses on securities |  |  |  | (9) |  |  | (1,893) |  |  | (3,888) |
Securities realized gains (losses), net |  |  | $ | 360 |  | $ | 474 |  | $ | (2,213) |
Income tax (expense) benefit on net realized gains (losses) |  |  | $ | (100) |  | $ | (198) |  | $ | 882 |
Effective tax rate applied |  |  |  | 27.8 | % |  | 41.8 | % |  | 39.9 | %

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