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Investment Securities
 6 Months Ended
Jun. 30, 2015
Investments Debt And Equity Securities Abstract  
Investment Securities
(4) Investment Securities

 

The amortized cost and fair value of debt securities classified as available-for-sale at June 30, 2015 and December 31, 2014 were as follows:

          Gross     Gross        
    Amortized     Unrealized     Unrealized        
(in thousands)   Cost     Gains     Losses     Fair value  
June 30, 2015                                
Government sponsored enterprises   $ 76,667     $ 287     $ 110       76,844  
Asset-backed securities     129,205       746       1,533       128,418  
Obligations of states and political subdivisions     33,869       450       94       34,225  
Total available-for-sale securities   $ 239,741     $ 1,483     $ 1,737     $ 239,487  
                                 
December 31, 2014                                
Government sponsored enterprises   $ 57,002     $ 240     $ 143       57,099  
Asset-backed securities     106,726       855       1,119       106,462  
Obligations of states and political subdivisions     34,925       583       71       35,437  
Total available-for-sale securities   $ 198,653     $ 1,678     $ 1,333     $ 198,998  

 

All of the Company’s investment securities are classified as available for sale. Agency bonds and notes, agency mortgage-backed securities and agency collateralized mortgage obligations (CMO) include securities issued by the Government National Mortgage Association (GNMA), a U.S. government agency, and the Federal National Mortgage Association (FNMA), the Federal Home Loan Mortgage Corporation (FHLMC) and the Federal Home Loan Bank (FHLB), which are U.S. government-sponsored enterprises.

 

Other investments and securities primarily consist of Federal Home Loan Bank stock, subordinated debt securities, and the Company’s interest in statutory trusts. These securities are reported at cost in the amount of $7.9 million and $4.7 million as of June 30, 2015 and December 31, 2014, respectively.

 

Debt securities with carrying values aggregating approximately $181.6 million and $145.5 million at June 30, 2015 and December 31, 2014, respectively, were pledged to secure public funds, securities sold under agreements to repurchase, and for other purposes as required or permitted by law.

 

The amortized cost and fair value of debt securities classified as available-for-sale at June 30, 2015, by contractual maturity are shown below. Expected maturities may differ from contractual maturities because borrowers have the right to call or prepay obligations with or without prepayment penalties.

 

    Amortized     Fair  
(in thousands)   Cost     Value  
Due in one year or less   $ 17,500     $ 17,591  
Due after one year through five years     78,174       78,453  
Due after five years through ten years     14,023       14,198  
Due after ten years     839       827  
Total     110,536       111,069  
Asset-backed securities     129,205       128,418  
Total available-for-sale securities   $ 239,741     $ 239,487  

 

Gross unrealized losses on debt securities and the fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at June 30, 2015 and December 31, 2014 were as follows:

 

     Less than 12 months      12 months or more      Total      Total  
     Fair      Unrealized      Fair      Unrealized      Fair      Unrealized  
(in thousands)    Value      Losses      Value      Losses      Value      Losses  
At June 30, 2015                                                
Government sponsored                                                
 enterprises   $ 30,032     $ (100 )   $ 3,990     $ (10 )   $ 34,022     $ (110 )
Asset-backed securities     48,526       (498 )     36,908       (1,035 )     85,434       (1,533 )
Obligations of states and                                                
 political subdivisions     8,289       (81 )     489       (13 )     8,778       (94 )
 Total   $ 86,847     $ (679 )   $ 41,387     $ (1,058 )   $ 128,234     $ (1,737 )
                                                 
(in thousands)                                                
At December 31, 2014                                                
Government sponsored                                                
 enterprises   $ 2,983     $ (4 )   $ 17,862     $ (139 )   $ 20,845     $ (143 )
Asset-backed securities     10,314       (50 )     45,445       (1,069 )     55,759       (1,119 )
Obligations of states and                                                
 political subdivisions     3,667       (15 )     1,942       (56 )     5,609       (71 )
 Total   $ 16,964     $ (69 )   $ 65,249     $ (1,264 )   $ 82,213     $ (1,333 )

 

The total available for sale portfolio consisted of approximately 321 securities at June 30, 2015. The portfolio included 110 securities having an aggregate fair value of $128.2 million that were in a loss position at June 30, 2015. Securities identified as temporarily impaired which had been in a loss position for 12 months or longer totaled $41.4 million at fair value. The $1.7 million aggregate unrealized loss included in accumulated other comprehensive income at June 30, 2015 was caused by interest rate fluctuations.

 

The total available for sale portfolio consisted of approximately 300 securities at December 31, 2014. The portfolio included 74 securities having an aggregate fair value of $82.2 million that were in a loss position at December 31, 2014. Securities identified as temporarily impaired which had been in a loss position for 12 months or longer totaled $65.2 million at fair value. The $1.3 million aggregate unrealized loss included in accumulated other comprehensive income at December 31, 2014 was caused by interest rate fluctuations.

 

Because the decline in fair value is attributable to changes in interest rates and not credit quality these investments were not considered other-than-temporarily impaired at June 30, 2015 and December 31, 2014, respectively. In addition, the Company does not have the intent to sell these investments over the period of recovery, and it is not more likely than not that it will be required to sell such investment securities. There have been no investment securities gains and losses which have been recognized in earnings for the three months ended June 30, 2015 and 2014.

 

The table below presents the components of investment securities gains and losses which have been recognized in earnings.

 

    Three Months Ended June 30,     Six Months Ended June 30,  
(in thousands)   2015     2014     2015     2014  
Gains realized on sales   $ 8     $ 0     $ 8     $ 0  
Losses realized on sales     0       0       0       0  
Other-than-temporary impairment recognized     0       0       0       0  
Investment securities gains   $ 8     $ 0     $ 8     $ 0