Investments (Tables)

3 Months Ended

Mar. 31, 2015

The following table shows a comparison of amortized cost and fair values of investment securities at March 31, 2015 and December 31, 2014:



(in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		OTTI in AOCI
March 31, 2015
Available for Sale:
U.S. treasuries	$	27,083	$	14	$	0	$	27,097	$	0
U.S. government agencies		44,067		226		75		44,218		0
Residential mortgage-backed agencies		28,774		478		244		29,008		0
Commercial mortgage-backed agencies		36,636		439		29		37,046		0
Collateralized mortgage obligations		14,028		161		0		14,189		0
Obligations of states and political subdivisions		46,696		1,365		215		47,846		0
Collateralized debt obligations		37,399		2,663		11,671		28,391		3,532
Total available for sale	$	234,683	$	5,346	$	12,234	$	227,795	$	3,532

Held to Maturity:
U.S. government agencies	$	24,566	$	911	$	0	$	25,477	$	0
Residential mortgage-backed agencies		58,427		958		34		59,351		0
Commercial mortgage-backed agencies		16,331		559		0		16,890		0
Collateralized mortgage obligations		6,991		83		0		7,074		0
Obligations of states and political subdivisions		2,725		0		197		2,528		0
Total held to maturity	$	109,040	$	2,511	$	231	$	111,320	$	0

December 31, 2014
Available for Sale:
U.S. treasuries	$	29,607	$	0	$	11	$	29,596	$	0
U.S. government agencies		39,077		117		253		38,941		0
Residential mortgage-backed agencies		45,175		510		412		45,273		0
Commercial mortgage-backed agencies		26,007		53		103		25,957		0
Collateralized mortgage obligations		8,611		96		0		8,707		0
Obligations of states and political subdivisions		46,151		1,413		260		47,304		0
Collateralized debt obligations		37,117		1,155		12,933		25,339		6,143
Total available for sale	$	231,745	$	3,344	$	13,972	$	221,117	$	6,143
Held to Maturity:
U.S. government agencies	$	24,520	$	514	$	0	$	25,034	$	0
Residential mortgage-backed agencies		58,400		613		5		59,008		0
Commercial mortgage-backed agencies		16,425		312		0		16,737		0
Collateralized mortgage obligations		7,379		5		0		7,384		0
Obligations of states and political subdivisions		2,725		0		117		2,608		0
Total held to maturity	$	109,449	$	1,444	$	122	$	110,771	$	0

Proceeds from Sales and Realized Gain and Losses

Proceeds from sales of securities and the realized gains and losses are as follows:


	Three Months Ended
	March 31,
(in thousands)	2015		2014
Proceeds	$	15,091	$	8,585
Realized gains		16		95
Realized losses		113		163

Gross Unrealized Losses and Fair Values of Securities

The following table shows the Corporation’s investment securities with gross unrealized losses and fair values at March 31, 2015 and December 31, 2014, aggregated by investment category and the length of time that individual securities have been in a continuous unrealized loss position:


	Less than 12 months				12 months or more
(in thousands)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
March 31, 2015
Available for Sale:
U.S. treasuries	$	0	$	0	$	0	$	0
U.S. government agencies		0		0		9,925		75
Residential mortgage-backed agencies		0		0		8,464		244
Commercial mortgage-backed agencies		5,841		29		0		0
Collateralized mortgage obligations		0		0		0		0
Obligations of states and political subdivisions		4,207		58		5,264		157
Collateralized debt obligations		0		0		21,730		11,671
Total available for sale	$	10,048	$	87	$	45,383	$	12,147

Held to Maturity:
U.S. government agencies	$	0	$	0	$	0	$	0
Residential mortgage-backed agencies		5,061		34		0		0
Commercial mortgage-backed agencies		0		0		0		0
Collateralized mortgage obligations		0		0		0		0
Obligations of states and political subdivisions		0		0		2,528		197
Total held to maturity	$	5,061	$	34	$	2,528	$	197


December 31, 2014
Available for Sale:
U.S. treasuries	$	27,096	$	11	$	0	$	0
U.S. government agencies		0	$	0	$	18,819	$	253
Residential mortgage-backed agencies		0		0		17,918		412
Commercial mortgage-backed agencies		12,298		97		973		6
Collateralized mortgage obligations		0		0		0		0
Obligations of states and political subdivisions		0		0		8,981		260
Collateralized debt obligations		0		0		20,290		12,933
Total available for sale	$	39,394	$	108	$	66,981	$	13,864
Held to Maturity:
U.S. government agencies	$	0	$	0	$	0	$	0
Residential mortgage-backed agencies		3,850		5		0		0
Commercial mortgage-backed agencies		0		0		0		0
Collateralized mortgage obligations		0		0		0		0
Obligations of states and political subdivisions		0		0		2,608		117
Total held to maturity	$	3,850	$	5	$	2,608	$	117

Non-Cash OTTI Credit Losses Recognized in Earnings

The following tables present a cumulative roll-forward of the amount of non-cash OTTI charges related to credit losses which have been recognized in earnings for the trust preferred securities in the CDO portfolio held and not intended to be sold for the three-month periods ended March 31, 2015 and 2014:




	Three Months Ended March 31,
(in thousands)	2015		2014
Balance of credit-related OTTI at January 1	$	12,583	$	13,422
Reduction for increases in cash flows expected to be collected		(167)		(160)
Balance of credit-related OTTI at March 31	$	12,416	$	13,262

Amortized Cost and Fair Values Classified by Contractual Maturity Date


	March 31, 2015
(in thousands)	Amortized Cost		Fair Value
Contractual Maturity
Available for sale:
Due in one year or less	$	17,012	$	17,013
Due after one year through five years		53,265		53,558
Due after five years through ten years		25,026		25,825
Due after ten years		59,942		51,156
		155,245		147,552

Residential mortgage-backed agencies		28,774		29,008
Commercial mortgage-backed agencies		36,636		37,046
Collateralized mortgage obligations		14,028		14,189
	$	234,683	$	227,795
Held to Maturity:
Due after five years through ten years	$	15,506	$	16,106
Due after ten years		11,785		11,899
		27,291		28,005

Residential mortgage-backed agencies		58,427		59,351
Commercial mortgage-backed agencies		16,331		16,890
Collateralized mortgage obligations		6,991		7,074
	$	109,040	$	111,320

- Definition

Tabular disclosure of the amount of other than temporary impairment (OTTI) related to credit losses recognized in earnings including: (a) the beginning balance of the amount related to credit losses on debt securities held by the investor at the beginning of the period for which a portion of an OTTI was recognized in other comprehensive income; (b) additions for the amount related to the credit loss for which an OTTI was not previously recognized; (c) reductions for securities sold during the period (realized); (d) reductions for securities for which the amount previously recognized in other comprehensive income was recognized in earnings because the investor intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis; (e) additional increases to the amount related to the credit loss for which an OTTI was previously recognized when the investor does not intend to sell the security and it is not more likely than not that the investor will be required to sell the security before recovery of its amortized cost basis; (f) reductions for increases in cash flows expected to be collected that are recognized over the remaining life of the security; and (g) the ending balance of the amount related to credit losses on debt securities held by the entity at the end of the period for which a portion of an OTTI was recognized in other comprehensive income.

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