XML 117 R11.htm IDEA: XBRL DOCUMENT
v2.4.0.8

Investment Securities | 12 Months Ended
--- | ---
Dec. 31, 2013
Investment Securities |
Note 3. | Investment Securities
The following tables present the amortized cost and fair value of available-for-sale securities, including gross unrealized gains and losses, as of the dates indicated:
|  | December 31, 2013 |
(Amounts in thousands) |  | Amortized Cost |  |  | Unrealized Gains |  |  | Unrealized Losses |  |  | Fair Value |  |  | OTTI in AOCI (1) |
U.S. Treasury securities |  | $ | 9,708 |  |  | $ | — |  |  | $ | (695 | ) |  | $ | 9,013 |  |  | $ | — |
Municipal securities |  |  | 147,049 |  |  |  | 1,868 |  |  |  | (4,637 | ) |  |  | 144,280 |  |  |  | — |
Single issue trust preferred securities |  |  | 55,764 |  |  |  | — |  |  |  | (9,530 | ) |  |  | 46,234 |  |  |  | — |
Corporate securities |  |  | 5,000 |  |  |  | — |  |  |  | (129 | ) |  |  | 4,871 |  |  |  | — |
Mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Agency |  |  | 306,319 |  |  |  | 2,575 |  |  |  | (8,508 | ) |  |  | 300,386 |  |  |  | — |
Non-Agency Alt-A residential |  |  | 12,543 |  |  |  | — |  |  |  | (2,754 | ) |  |  | 9,789 |  |  |  | (2,754 | )
Total mortgage-backed securities |  |  | 318,862 |  |  |  | 2,575 |  |  |  | (11,262 | ) |  |  | 310,175 |  |  |  | (2,754 | )
Equity securities |  |  | 5,259 |  |  |  | 24 |  |  |  | (36 | ) |  |  | 5,247 |  |  |  | — |
Total |  | $ | 541,642 |  |  | $ | 4,467 |  |  | $ | (26,289 | ) |  | $ | 519,820 |  |  | $ | (2,754 | )
|  | December 31, 2012 |
(Amounts in thousands) |  | Amortized Cost |  |  | Unrealized Gains |  |  | Unrealized Losses |  |  | Fair Value |  |  | OTTI in AOCI (1) |
Municipal securities |  | $ | 151,119 |  |  | $ | 8,195 |  |  | $ | (97 | ) |  | $ | 159,217 |  |  | $ | — |
Single issue trust preferred securities |  |  | 55,707 |  |  |  | — |  |  |  | (11,061 | ) |  |  | 44,646 |  |  |  | — |
Mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Agency |  |  | 310,323 |  |  |  | 6,023 |  |  |  | (449 | ) |  |  | 315,897 |  |  |  | — |
Non-Agency Alt-A residential |  |  | 14,215 |  |  |  | — |  |  |  | (3,148 | ) |  |  | 11,067 |  |  |  | (3,148 | )
Total mortgage-backed securities |  |  | 324,538 |  |  |  | 6,023 |  |  |  | (3,597 | ) |  |  | 326,964 |  |  |  | (3,148 | )
Equity securities |  |  | 3,446 |  |  |  | 190 |  |  |  | (105 | ) |  |  | 3,531 |  |  |  | — |
Total |  | $ | 534,810 |  |  | $ | 14,408 |  |  | $ | (14,860 | ) |  | $ | 534,358 |  |  | $ | (3,148 | )
(1) | Other-than-temporary impairment in accumulated other comprehensive income
The following table presents the amortized cost, fair value, and weighted-average yield of available-for-sale securities, by contractual maturity, as of December 31, 2013. Actual maturities could differ from contractual maturities because issuers may have the right to call or prepay obligations with or without penalties.
(Amounts in thousands) |  | U.S. Treasury Securities |  |  | Municipal Securities |  |  | Corporate Notes |  |  | Total |  |  | Tax Equivalent Purchase Yield (1) |
Amortized cost maturity: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Within one year |  | $ | — |  |  | $ | 1,386 |  |  | $ | — |  |  | $ | 1,386 |  |  |  | 3.85 | %
After one year through five years |  |  | — |  |  |  | 14,227 |  |  |  | — |  |  |  | 14,227 |  |  |  | 5.69 | %
After five years through ten years |  |  | 9,708 |  |  |  | 131,436 |  |  |  | 55,762 |  |  |  | 196,906 |  |  |  | 3.63 | %
After ten years |  |  | — |  |  |  | — |  |  |  | 5,002 |  |  |  | 5,002 |  |  |  | 1.15 | %
Amortized cost |  | $ | 9,708 |  |  | $ | 147,049 |  |  | $ | 60,764 |  |  |  | 217,521 |  |  |  |  |
Mortgage-backed securities |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 318,862 |  |  |  | 2.50 | %
Equity securities |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 5,259 |  |  |  | 4.92 | %
Total amortized cost |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 541,642 |  |  |  |  |
Tax equivalent purchase yield |  |  | 2.09 | % |  |  | 4.76 | % |  |  | 1.34 | % |  |  | 3.01 | % |  |  |  |
Average contractual maturity (in years) |  |  | 9.38 |  |  |  | 10.42 |  |  |  | 13.55 |  |  |  | 11.25 |  |  |  |  |
Fair value maturity: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Within one year |  | $ | — |  |  | $ | 1,393 |  |  | $ | — |  |  | $ | 1,393 |  |  |  |  |
After one year through five years |  |  | — |  |  |  | 14,557 |  |  |  | — |  |  |  | 14,557 |  |  |  |  |
After five years through ten years |  |  | 9,013 |  |  |  | 128,330 |  |  |  | 47,131 |  |  |  | 184,474 |  |  |  |  |
After ten years |  |  | — |  |  |  | — |  |  |  | 3,974 |  |  |  | 3,974 |  |  |  |  |
Fair value |  | $ | 9,013 |  |  | $ | 144,280 |  |  | $ | 51,105 |  |  |  | 204,398 |  |  |  |  |
Mortgage-backed securities |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 310,175 |  |  |  |  |
Equity securities |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 5,247 |  |  |  |  |
Total fair value |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 519,820 |  |  |  |  |
(1) | Fully taxable equivalent at the rate of 35%.
The following tables present the amortized cost and fair value of held-to-maturity securities, including gross unrealized gains and losses, as of the dates indicated:
|  | December 31, 2013 |
(Amounts in thousands) |  | Amortized Cost |  |  | Unrealized Gains |  |  | Unrealized Losses |  |  | Fair Value |
Municipal securities |  | $ | 568 |  |  | $ | 11 |  |  | $ | — |  |  | $ | 579 |
Total |  | $ | 568 |  |  | $ | 11 |  |  | $ | — |  |  | $ | 579 |
|  | December 31, 2012 |
(Amounts in thousands) |  | Amortized Cost |  |  | Unrealized Gains |  |  | Unrealized Losses |  |  | Fair Value |
Municipal securities |  | $ | 816 |  |  | $ | 16 |  |  | $ | — |  |  | $ | 832 |
Total |  | $ | 816 |  |  | $ | 16 |  |  | $ | — |  |  | $ | 832 |
The following table presents the amortized cost, fair value, and weighted-average yield of held-to-maturity securities, by contractual maturity, as of December 31, 2013. Actual maturities could differ from contractual maturities because issuers may have the right to call or prepay obligations with or without penalties.
(Amounts in thousands) |  | Municipal Securities |  |  | Tax Equivalent Purchase Yield (1) |
Amortized cost maturity: |  |  |  |  |  |  |  |
Within one year |  | $ | 190 |  |  |  | 8.05 | %
After one year through five years |  |  | 378 |  |  |  | 8.17 | %
After five years through ten years |  |  | — |  |  |  | — |
After ten years |  |  | — |  |  |  | — |
Total amortized cost |  | $ | 568 |  |  |  |  |
Tax equivalent purchase yield |  |  | 8.13 | % |  |  |  |
Average contractual maturity (in years) |  |  | 1.33 |  |  |  |  |
Fair value maturity: |  |  |  |  |  |  |  |
Within one year |  | $ | 193 |  |  |  |  |
After one year through five years |  |  | 386 |  |  |  |  |
After five years through ten years |  |  | — |  |  |  |  |
After ten years |  |  | — |  |  |  |  |
Total fair value |  | $ | 579 |  |  |  |  |
(1) | Fully taxable equivalent at the rate of 35%.
The following table presents municipal securities, by state, for the states where the largest volume of these securities are held in the Company’s portfolio. The table also presents the amortized cost and fair value of the municipal securities, including gross unrealized gains and losses, as of the dates indicated.
|  | December 31, 2013 |
(Amounts in thousands) |  | Percent of Municipal Portfolio |  |  | Amortized Cost |  |  | Unrealized Gains |  |  | Unrealized Losses |  |  | Fair Value |
New York |  |  | 11.34 | % |  | $ | 16,161 |  |  | $ | 294 |  |  | $ | (28 | ) |  | $ | 16,427 |
Minnesota |  |  | 8.56 | % |  |  | 12,504 |  |  |  | 174 |  |  |  | (279 | ) |  |  | 12,399 |
New Jersey |  |  | 8.18 | % |  |  | 11,565 |  |  |  | 306 |  |  |  | (25 | ) |  |  | 11,846 |
Connecticut |  |  | 7.86 | % |  |  | 11,406 |  |  |  | 91 |  |  |  | (109 | ) |  |  | 11,388 |
Wisconsin |  |  | 7.83 | % |  |  | 11,815 |  |  |  | 118 |  |  |  | (584 | ) |  |  | 11,349 |
Ohio |  |  | 7.45 | % |  |  | 11,299 |  |  |  | 135 |  |  |  | (637 | ) |  |  | 10,797 |
Massachusetts |  |  | 6.85 | % |  |  | 10,102 |  |  |  | 119 |  |  |  | (295 | ) |  |  | 9,926 |
Texas |  |  | 6.24 | % |  |  | 9,483 |  |  |  | 134 |  |  |  | (576 | ) |  |  | 9,041 |
Other |  |  | 35.68 | % |  |  | 53,282 |  |  |  | 508 |  |  |  | (2,104 | ) |  |  | 51,686 |
Total |  |  | 100.00 | % |  | $ | 147,617 |  |  | $ | 1,879 |  |  | $ | (4,637 | ) |  | $ | 144,859 |
|  | December 31, 2013 |
(Amounts in thousands) |  | Percent of Municipal Portfolio |  |  | Amortized Cost |  |  | Unrealized Gains |  |  | Unrealized Losses |  |  | Fair Value |
New York |  |  | 11.04 | % |  | $ | 16,552 |  |  | $ | 1,114 |  |  | $ | — |  |  | $ | 17,666 |
Wisconsin |  |  | 8.66 | % |  |  | 13,266 |  |  |  | 602 |  |  |  | — |  |  |  | 13,868 |
Minnesota |  |  | 8.61 | % |  |  | 12,990 |  |  |  | 798 |  |  |  | (4 | ) |  |  | 13,784 |
New Jersey |  |  | 8.01 | % |  |  | 11,940 |  |  |  | 874 |  |  |  | — |  |  |  | 12,814 |
Connecticut |  |  | 7.72 | % |  |  | 11,693 |  |  |  | 660 |  |  |  | — |  |  |  | 12,353 |
Texas |  |  | 7.42 | % |  |  | 11,416 |  |  |  | 470 |  |  |  | (16 | ) |  |  | 11,870 |
Ohio |  |  | 7.31 | % |  |  | 11,147 |  |  |  | 575 |  |  |  | (21 | ) |  |  | 11,701 |
Massachusetts |  |  | 6.98 | % |  |  | 10,531 |  |  |  | 642 |  |  |  | (3 | ) |  |  | 11,170 |
Other |  |  | 34.25 | % |  |  | 52,400 |  |  |  | 2,476 |  |  |  | (53 | ) |  |  | 54,823 |
Total |  |  | 100.00 | % |  | $ | 151,935 |  |  | $ | 8,211 |  |  | $ | (97 | ) |  | $ | 160,049 |
The following tables present the fair values and unrealized losses for available-for-sale securities in a continuous unrealized loss position for less than 12 months and for 12 months or longer as of the dates indicated. There were no held-to-maturity securities in a continuous unrealized loss position as of December 31, 2013 or 2012.
|  | December 31, 2013 |
|  | Less than 12 Months |  |  | 12 Months or longer |  |  | Total |
(Amounts in thousands) |  | Fair Value |  |  | Unrealized Losses |  |  | Fair Value |  |  | Unrealized Losses |  |  | Fair Value |  |  | Unrealized Losses |
U.S. Treasury securities |  | $ | 9,012 |  |  | $ | (695 | ) |  | $ | — |  |  | $ | — |  |  | $ | 9,012 |  |  | $ | (695 | )
Municipal securities |  |  | 57,950 |  |  |  | (4,147 | ) |  |  | 3,049 |  |  |  | (490 | ) |  |  | 60,999 |  |  |  | (4,637 | )
Single issue trust preferred securities |  |  | — |  |  |  | — |  |  |  | 46,234 |  |  |  | (9,530 | ) |  |  | 46,234 |  |  |  | (9,530 | )
Corporate securities |  |  | 4,872 |  |  |  | (129 | ) |  |  | — |  |  |  | — |  |  |  | 4,872 |  |  |  | (129 | )
Mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Agency |  |  | 114,047 |  |  |  | (4,361 | ) |  |  | 55,706 |  |  |  | (4,147 | ) |  |  | 169,753 |  |  |  | (8,508 | )
Non-Agency Alt-A residential |  |  | — |  |  |  | — |  |  |  | 9,789 |  |  |  | (2,754 | ) |  |  | 9,789 |  |  |  | (2,754 | )
Total mortgage-backed securities |  |  | 114,047 |  |  |  | (4,361 | ) |  |  | 65,495 |  |  |  | (6,901 | ) |  |  | 179,542 |  |  |  | (11,262 | )
Equity securities |  |  | 4,976 |  |  |  | (24 | ) |  |  | 20 |  |  |  | (12 | ) |  |  | 4,996 |  |  |  | (36 | )
Total |  | $ | 190,857 |  |  | $ | (9,356 | ) |  | $ | 114,798 |  |  | $ | (16,933 | ) |  | $ | 305,655 |  |  | $ | (26,289 | )
|  | December 31, 2012 |
|  | Less than 12 Months |  |  | 12 Months or longer |  |  | Total |
(Amounts in thousands) |  | Fair Value |  |  | Unrealized Losses |  |  | Fair Value |  |  | Unrealized Losses |  |  | Fair Value |  |  | Unrealized Losses |
Municipal securities |  | $ | 6,436 |  |  | $ | (97 | ) |  | $ | — |  |  | $ | — |  |  | $ | 6,436 |  |  | $ | (97 | )
Single issue trust preferred securities |  |  | — |  |  |  | — |  |  |  | 44,646 |  |  |  | (11,061 | ) |  |  | 44,646 |  |  |  | (11,061 | )
Mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Agency |  |  | 74,197 |  |  |  | (449 | ) |  |  | 15 |  |  |  | — |  |  |  | 74,212 |  |  |  | (449 | )
Non-Agency Alt-A residential |  |  | — |  |  |  | — |  |  |  | 11,066 |  |  |  | (3,148 | ) |  |  | 11,066 |  |  |  | (3,148 | )
Total mortgage-backed securities |  |  | 74,197 |  |  |  | (449 | ) |  |  | 11,081 |  |  |  | (3,148 | ) |  |  | 85,278 |  |  |  | (3,597 | )
Equity securities |  |  | 3,106 |  |  |  | (25 | ) |  |  | 108 |  |  |  | (80 | ) |  |  | 3,214 |  |  |  | (105 | )
Total |  | $ | 83,739 |  |  | $ | (571 | ) |  | $ | 55,835 |  |  | $ | (14,289 | ) |  | $ | 139,574 |  |  | $ | (14,860 | )
As of December 31, 2013, there were 219 individual securities in an unrealized loss position, and their combined depreciation in value represented 5.06% of the available-for-sale securities portfolio. Individual securities in an unrealized loss position as of December 31, 2013, included 32 securities in a continuous unrealized loss position for 12 months or longer that the Company does not intend to sell, and that it has determined is not more likely than not going to be required to sell, prior to the maturities or recoveries of the securities. As of December 31, 2012, there were 57 individual securities in an unrealized loss position, and their combined depreciation in value represented 2.78% of the available-for-sale securities portfolio. The following table presents the components of the Company’s net gain from the sale of securities in the periods indicated:
|  | Year Ended December 31, |
(Amounts in thousands) |  | 2013 |  |  | 2012 |  |  | 2011 |
Gross realized gains |  | $ | 553 |  |  | $ | 723 |  |  | $ | 6,963 |
Gross realized losses |  |  | (154 | ) |  |  | (240 | ) |  |  | (1,699 | )
Net gain on sale of securities |  | $ | 399 |  |  | $ | 483 |  |  | $ | 5,264 |
The carrying value of securities pledged to secure public deposits and other purposes was $284.77 million as of December 31, 2013, and $292.88 million as of December 31, 2012. The Company reviews its investment portfolio on a quarterly basis for indications of OTTI. Debt securities not beneficially owned by the Company include securities issued from the U.S. Department of the Treasury (the “Treasury”), municipal securities, and single issue trust preferred securities. For debt securities not beneficially owned, the Company analyzes factors such as the severity and duration of the impairment, adverse conditions within the issuing industry, prospects for the issuer, performance of the security, changes in rating by rating agencies, and other qualitative factors to determine if the impairment will be recovered. If the evaluation suggests that the impairment will not be recovered, the Company calculates the present value of the security to determine the amount of OTTI. The security is then written down to its current present value and the Company calculates and records the amount of the loss due to credit factors in earnings through noninterest income and the amount due to other factors in stockholders’ equity through OCI. During 2013 and 2012, the Company incurred no OTTI charges related to debt securities not beneficially owned. Temporary impairment on these securities is primarily related to changes in interest rates, certain disruptions in the credit markets, destabilization in the Eurozone, and other current economic factors. Debt securities beneficially owned by the Company consist of corporate FDIC securities and mortgage-backed securities (“MBS”). For debt securities beneficially owned, the Company analyzes the cash flows for each applicable security to determine if an adverse change in cash flows expected to be collected has occurred. If the projected value of cash flows at the current reporting date is less than the present value previously projected, and less than the current book value, an adverse change has occurred. The Company then compares the current present value of cash flows to the current net book value to determine the credit-related portion of the OTTI. The credit-related OTTI is recorded in earnings through noninterest income and any remaining noncredit-related OTTI is recorded in stockholders’ equity through OCI. The Company incurred credit-related OTTI charges related to debt securities beneficially owned of $320 thousand in 2013 and $942 thousand in 2012. These charges were related to a non-Agency MBS. The Company uses a discounted cash flow model for the non-Agency Alt-A residential MBS with the following assumptions: constant voluntary prepayment rate of 2%, a customized constant default rate scenario that assumes approximately 16% of the remaining underlying mortgages will default over the life of the security, and a customized loss severity rate scenario that ramps the loss rate down from 55% to 10% over the course of approximately three years. The following table presents the activity for credit-related losses recognized in earnings on debt securities where a portion of an OTTI was recognized in OCI for the periods indicated:
|  | Year Ended December 31, |
(Amounts in thousands) |  | 2013 |  |  | 2012 |  |  | 2011 |
Beginning balance (1) |  | $ | 7,478 |  |  | $ | 6,536 |  |  | $ | 4,251 |
Additions for credit losses on securities not previously recognized |  |  | — |  |  |  | — |  |  |  | — |
Additions for credit losses on securities previously recognized |  |  | 320 |  |  |  | 942 |  |  |  | 2,285 |
Reduction for increases in cash flows |  |  | — |  |  |  | — |  |  |  | — |
Reduction for securities management no longer intends to hold to recovery |  |  | — |  |  |  | — |  |  |  | — |
Reduction for securities sold/realized losses |  |  | — |  |  |  | — |  |  |  | — |
Ending balance |  | $ | 7,798 |  |  | $ | 7,478 |  |  | $ | 6,536 |
(1) | The beginning balance includes credit related losses included in OTTI charges recognized on debt securities in prior periods.
For equity securities, the Company considers its intent to hold or sell the security before recovery, the severity and duration of the decline in fair value of the security below its cost, the financial condition and near-term prospects of the issuer, and whether the decline appears to be related to issuer, general market, or industry conditions to determine if the impairment will be recovered. If the Company deems the impairment other-than-temporary in nature, the security is written down to its current present value and the OTTI loss is charged to earnings. During 2013 and 2012, the Company recognized no OTTI charges related to equity securities.

X
- Definition The entire disclosure for investments in certain debt and equity securities. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -SubTopic 10 -Section 50 -Paragraph 6 -URI http://asc.fasb.org/extlink&oid=27724398&loc=d3e27290-111563 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=27724398&loc=d3e27357-111563 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -Glossary Debt Security -URI http://asc.fasb.org/extlink&oid=6509901 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 310 -SubTopic 30 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6379141&loc=d3e15032-111544 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -SubTopic 10 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=27724398&loc=d3e27232-111563 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 320 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6957658&loc=d3e62557-112803 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=27724398&loc=d3e27161-111563 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=27724398&loc=d3e27405-111563 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -Glossary Equity Security -URI http://asc.fasb.org/extlink&oid=6511694 + Details
Name: | us-gaap_InvestmentsInDebtAndMarketableEquitySecuritiesAndCertainTradingAssetsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration