| Securities |
NOTE 3: SECURITIES
The following table provides a summary of the Company’s securities AFS portfolio as of:
|
|
Amortized |
|
|
Gross Unrealized |
|
|
Estimated |
|
|
(dollars in thousands) |
Cost |
|
|
Gains |
|
|
Losses |
|
|
Fair Value |
|
|
March 31, 2018: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US Treasury securities |
$ |
499 |
|
|
$ |
— |
|
|
$ |
(6 |
) |
|
$ |
493 |
|
|
Agency mortgage-backed securities |
|
453,596 |
|
|
|
— |
|
|
|
(14,728 |
) |
|
|
438,868 |
|
|
Beneficial interests in FHLMC securitization |
|
34,608 |
|
|
|
1,927 |
|
|
|
(1,929 |
) |
|
|
34,606 |
|
|
Corporate bonds |
|
39,000 |
|
|
|
100 |
|
|
|
— |
|
|
|
39,100 |
|
|
Total |
$ |
527,703 |
|
|
$ |
2,027 |
|
|
$ |
(16,663 |
) |
|
$ |
513,067 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2017: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US Treasury securities |
$ |
499 |
|
|
$ |
— |
|
|
$ |
(6 |
) |
|
$ |
493 |
|
|
Agency mortgage-backed securities |
|
471,131 |
|
|
|
287 |
|
|
|
(7,399 |
) |
|
|
464,019 |
|
|
Corporate bonds |
|
35,930 |
|
|
|
1,811 |
|
|
|
(1,889 |
) |
|
|
35,852 |
|
|
Beneficial interests in FHLMC securitization |
|
19,000 |
|
|
|
— |
|
|
|
— |
|
|
|
19,000 |
|
|
Total |
$ |
526,560 |
|
|
$ |
2,098 |
|
|
$ |
(9,294 |
) |
|
$ |
519,364 |
|
The US Treasury securities are pledged as collateral to the State of California to meet regulatory requirements related to the Bank’s trust operations.
The table below indicates the gross unrealized losses and fair values of our investments, aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position, for the periods indicated:
|
|
|
Securities with Unrealized Loss at March 31, 2018 |
|
|
(dollars in thousands) |
|
Less than 12 months |
|
|
12 months or more |
|
|
Total |
|
|
|
Fair
Value |
|
|
Unrealized
Loss |
|
|
Fair
Value |
|
|
Unrealized
Loss |
|
|
Fair
Value |
|
|
Unrealized
Loss |
|
|
US Treasury securities |
|
$ |
197 |
|
|
$ |
(2 |
) |
|
$ |
296 |
|
|
$ |
(4 |
) |
|
$ |
493 |
|
|
$ |
(6 |
) |
|
Agency mortgage backed securities |
|
|
193,370 |
|
|
|
(4,542 |
) |
|
|
245,498 |
|
|
|
(10,186 |
) |
|
|
438,868 |
|
|
|
(14,728 |
) |
|
Beneficial interest – FHLMC securitization |
|
|
— |
|
|
|
— |
|
|
|
8,235 |
|
|
|
(1,929 |
) |
|
|
8,235 |
|
|
|
(1,929 |
) |
|
Total temporarily impaired securities |
|
$ |
193,567 |
|
|
$ |
(4,544 |
) |
|
$ |
254,029 |
|
|
$ |
(12,119 |
) |
|
$ |
447,596 |
|
|
$ |
(16,663 |
) |
|
|
|
Securities with Unrealized Loss at December 31, 2017 |
|
|
(dollars in thousands) |
|
Less than 12 months |
|
|
12 months or more |
|
|
Total |
|
|
|
Fair
Value |
|
|
Unrealized
Loss |
|
|
Fair
Value |
|
|
Unrealized
Loss |
|
|
Fair
Value |
|
|
Unrealized
Loss |
|
|
US Treasury securities |
|
$ |
197 |
|
|
$ |
(2 |
) |
|
$ |
296 |
|
|
$ |
(4 |
) |
|
$ |
493 |
|
|
$ |
(6 |
) |
|
Agency mortgage backed securities |
|
|
158,984 |
|
|
|
(1,394 |
) |
|
|
259,213 |
|
|
|
(6,005 |
) |
|
|
418,197 |
|
|
|
(7,399 |
) |
|
Beneficial interest – FHLMC securitization |
|
|
— |
|
|
|
— |
|
|
|
8,738 |
|
|
|
(1,889 |
) |
|
|
8,738 |
|
|
|
(1,889 |
) |
|
Total temporarily impaired securities |
|
$ |
159,181 |
|
|
$ |
(1,396 |
) |
|
$ |
268,247 |
|
|
$ |
(7,898 |
) |
|
$ |
427,428 |
|
|
$ |
(9,294 |
) |
Unrealized losses on US Treasury securities, agency notes and agency mortgage-backed securities have not been recognized into income because the issuer bonds are of high credit quality, management does not intend to sell and it is not more likely than not that management would be required to sell the securities prior to their anticipated recovery. The decline in fair value is largely due to changes in interest rates. The fair value is expected to recover as the bonds approach maturity.
The scheduled maturities of securities AFS and the related weighted average yields were as follows for the periods indicated:
|
(dollars in thousands) |
|
Less than
1 Year |
|
|
1 Through
5 years |
|
|
5 Through
10 Years |
|
|
After
10 Years |
|
|
Total |
|
|
March 31, 2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortized Cost: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US Treasury securities |
|
$ |
— |
|
|
$ |
499 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
499 |
|
|
Corporate bonds |
|
|
— |
|
|
|
— |
|
|
|
19,000 |
|
|
|
20,000 |
|
|
|
39,000 |
|
|
Total |
|
|
— |
|
|
|
499 |
|
|
|
19,000 |
|
|
|
20,000 |
|
|
|
39,499 |
|
|
Weighted average yield |
|
|
— |
% |
|
|
1.03 |
% |
|
|
5.24 |
% |
|
|
5.00 |
% |
|
|
5.06 |
% |
|
Estimated Fair Value: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US Treasury securities |
|
$ |
— |
|
|
$ |
493 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
493 |
|
|
Corporate bonds |
|
|
— |
|
|
|
— |
|
|
|
19,000 |
|
|
|
20,100 |
|
|
|
39,100 |
|
|
Total |
|
$ |
— |
|
|
$ |
493 |
|
|
$ |
19,000 |
|
|
$ |
20,100 |
|
|
$ |
39,593 |
|
|
(dollars in thousands) |
|
Less than
1 Year |
|
|
1 Through
5 years |
|
|
5 Through
10 Years |
|
|
After
10 Years |
|
|
Total |
|
|
December 31, 2017 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortized Cost: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US Treasury securities |
|
$ |
— |
|
|
$ |
499 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
499 |
|
|
Corporate bonds |
|
|
— |
|
|
|
— |
|
|
|
19,000 |
|
|
|
— |
|
|
|
19,000 |
|
|
Total |
|
|
— |
|
|
|
499 |
|
|
|
19,000 |
|
|
|
— |
|
|
|
19,499 |
|
|
Weighted average yield |
|
|
— |
% |
|
|
1.03 |
% |
|
|
5.24 |
% |
|
|
— |
% |
|
|
5.13 |
% |
|
Estimated Fair Value: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US Treasury securities |
|
$ |
— |
|
|
$ |
493 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
493 |
|
|
Corporate bonds |
|
|
— |
|
|
|
— |
|
|
|
19,000 |
|
|
|
— |
|
|
|
19,000 |
|
|
Total |
|
$ |
— |
|
|
$ |
493 |
|
|
$ |
19,000 |
|
|
$ |
— |
|
|
$ |
19,493 |
|
Agency mortgage backed securities and beneficial interests in FHLMC securitization are excluded from the above table because such securities are not due at a single maturity date. The weighted average yield of the agency mortgage backed securities and beneficial interests in FHLMC securitization as of March 31, 2018 was 2.56%.
|