3. INVESTMENT SECURITIES

A summary of our investment portfolio is as follows:



(dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
March 31, 2019
Available-for-sale:
Debt securities:
States and political subdivisions	$	161,638	$	1,532	$	(562	)	$	162,608
Corporate securities	52,893		90		(87		)	52,896
U.S. Treasury obligations and direct obligations of U.S Government agencies	31,985		—		(448		)	31,537
Mortgage-backed securities:
Residential - U.S. Government-sponsored entities	791,994		1,183		(13,517		)	779,660
Commercial - U.S. Government agencies and sponsored entities	117,671		87		(1,283		)	116,475
Residential - Non-government agencies	40,648		573		(112		)	41,109
Commercial - Non-government agencies	134,819		1,138		(792		)	135,165
Total available-for-sale securities	$	1,331,648	$	4,603	$	(16,801	)	$	1,319,450

Equity securities	$	910	$	—	$	—		$	910



(dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
December 31, 2018
Held-to-maturity:
Mortgage-backed securities:
Residential - U.S. Government-sponsored entities	$	83,436	$	19	$	(3,174	)	$	80,281
Commercial - U.S. Government-sponsored entities	65,072		—		(1,081		)	63,991
Total held-to-maturity securities	$	148,508	$	19	$	(4,255	)	$	144,272

Available-for-sale:
Debt securities:
States and political subdivisions	$	174,114	$	1,035	$	(1,475	)	$	173,674
Corporate securities	55,259		—		(410		)	54,849
U.S. Treasury obligations and direct obligations of U.S Government agencies	33,257		—		(683		)	32,574
Mortgage-backed securities:
Residential - U.S. Government-sponsored entities	736,175		369		(19,492		)	717,052
Commercial - U.S. Government agencies and sponsored entities	53,014		—		(1,531		)	51,483
Residential - Non-government agencies	41,245		337		(464		)	41,118
Commercial - Non-government agencies	134,867		1,013		(1,152		)	134,728
Total available-for-sale securities	$	1,227,931	$	2,754	$	(25,207	)	$	1,205,478

Equity securities	$	826	$	—	$	—		$	826

As discussed in Note 2 - Recent Accounting Pronouncements, on January 1, 2019 in connection with the adoption of ASU 2017-12, the Company transferred all of its held-to-maturity investment securities with an amortized cost of $148.5 million and fair value of $144.3 million to its available-for-sale investment securities portfolio.

The amortized cost and estimated fair value of investment securities at March 31, 2019 by contractual maturity are shown below. Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately.



	March 31, 2019
(dollars in thousands)	Amortized Cost		Fair Value
Available-for-sale:
Due in one year or less	$	58,360	$	58,394
Due after one year through five years	88,840		89,162
Due after five years through ten years	50,939		51,278
Due after ten years	48,377		48,207

Mortgage-backed securities:
Residential - U.S. Government-sponsored entities	791,994		779,660
Commercial - U.S. Government agencies and sponsored entities	117,671		116,475
Residential - Non-government agencies	40,648		41,109
Commercial - Non-government agencies	134,819		135,165
Total available-for-sale securities	$	1,331,648	$	1,319,450

Equity securities	$	910	$	910

We did not sell any available-for-sale securities during the three months ended March 31, 2019 and March 31, 2018.

Investment securities of $0.80 billion and $0.98 billion at March 31, 2019 and December 31, 2018, respectively, were pledged to secure public funds on deposit and other short-term borrowings.

Provided below is a summary of the 245 and 336 investment securities which were in an unrealized or unrecognized loss position at March 31, 2019 and December 31, 2018, respectively, aggregated by major security type and length of time in a continuous unrealized or unrecognized loss position.



	Less Than 12 Months					12 Months or Longer					Total
(dollars in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
March 31, 2019
Debt securities:
States and political subdivisions	$	13,980	$	(20	)	$	35,577	$	(542	)	$	49,557	$	(562	)
Corporate securities	—		—			25,054		(87		)	25,054		(87		)
U.S. Treasury obligations and direct obligations of U.S Government agencies	12,630		(93		)	18,907		(355		)	31,537		(448		)
Mortgage-backed securities:
Residential - U.S. Government-sponsored entities	22,533		(461		)	645,030		(13,056		)	667,563		(13,517		)
Residential - Non-government agencies	—		—			15,478		(112		)	15,478		(112		)
Commercial - U.S. Government agencies and sponsored entities	—		—			102,257		(1,283		)	102,257		(1,283		)
Commercial - Non-government agencies	14,888		(48		)	60,637		(744		)	75,525		(792		)
Total temporarily impaired securities	$	64,031	$	(622	)	$	902,940	$	(16,179	)	$	966,971	$	(16,801	)



	Less Than 12 Months					12 Months or Longer					Total
(dollars in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
December 31, 2018
Debt securities:
States and political subdivisions	$	38,099	$	(157	)	$	49,505	$	(1,318	)	$	87,604	$	(1,475	)
Corporate securities	49,729		(250		)	5,120		(160		)	54,849		(410		)
U.S. Treasury obligations and direct obligations of U.S Government agencies	30,029		(613		)	2,545		(70		)	32,574		(683		)
Mortgage-backed securities:
Residential - U.S. Government-sponsored entities	88,957		(1,229		)	666,685		(21,437		)	755,642		(22,666		)
Residential - Non-government agencies	—		—			24,515		(464		)	24,515		(464		)
Commercial - U.S. Government-sponsored entities	13,973		(247		)	101,500		(2,365		)	115,473		(2,612		)
Commercial - Non-government agencies	33,847		(233		)	46,680		(919		)	80,527		(1,152		)
Total temporarily impaired securities	$	254,634	$	(2,729	)	$	896,550	$	(26,733	)	$	1,151,184	$	(29,462	)

Visa and MasterCard Class B Common Stock

As of March 31, 2019, the Company owns 34,631 shares of Class B common stock of Visa, Inc. ("Visa"). These shares were received in 2008 as part of Visa's initial public offering ("IPO"). These shares are transferable only under limited circumstances until they can be converted into shares of the publicly traded Class A common stock. This conversion will not occur until the resolution of certain litigation, which is indemnified by Visa members. Since its IPO, Visa has funded a litigation reserve to settle these litigation claims. At its discretion, Visa may continue to increase the litigation reserve based upon a change in the conversion ratio of each member bank’s restricted Class B common stock to unrestricted Class A common stock. Due to the existing transfer restriction and the uncertainty of the outcome of the Visa litigation, the Company has determined that the Visa Class B common stock does not have a readily determinable fair value and chooses to carry the shares on the Company's consolidated balance sheets at zero cost basis.

During the first quarter of 2019, the Company converted the 11,170 shares of Class B common stock of MasterCard, Inc. ("MasterCard") it received during their initial public offering to an equal number of Class A common stock and sold the shares for $2.6 million. The shares were carried on the Company's consolidated balance sheets at zero cost basis and the proceeds received were recorded as a gain in other operating income - other in the Company's consolidated statements of income. The Company no longer owns any shares of MasterCard Class B common stock.