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Investment Securities
 12 Months Ended
Dec. 31, 2015
Investments, Debt and Equity Securities [Abstract]  
Investment Securities
Investment Securities
 
The amortized cost and estimated fair value of securities were as follows:
 
 
 
December 31, 2015
 
 
Amortized
Cost
 
Unrealized
Gain
 
Unrealized
Loss
 
Estimated
Fair Value
 
 
(in thousands)
Available-for-sale:
 
 

 
 
 
 
 
 
Municipal bonds
 
$
128,546

 
$
1,796

 
$
(97
)
 
$
130,245

Collateralized mortgage obligation
 
24,722

 
4

 
(183
)
 
24,543

Mortgage-backed securities
 
126,443

 
153

 
(1,111
)
 
125,485

Total available-for-sale
 
279,711

 
1,953

 
(1,391
)
 
280,273

Held-to-maturity:
 
 
 
 
 
 
 
 
Mortgage-backed securities
 
8,400

 
—

 
(70
)
 
8,330

Other
 
1,242

 
—

 
—

 
1,242

Total held-to-maturity
 
9,642

 
—

 
(70
)
 
9,572

Total securities
 
$
289,353

 
$
1,953

 
$
(1,461
)
 
$
289,845

 
 
 
 
 
 
 
 
 
 
 
December 31, 2014
 
 
Amortized
 
Unrealized
 
Unrealized
 
Estimated
 
 
Cost
 
Gain
 
Loss
 
Fair Value
 
 
(in thousands)
Available-for-sale:
 
 

 
 

 
 

 
 

Municipal bonds
 
$
88,599

 
$
1,235

 
$
(173
)
 
$
89,661

Collateralized mortgage obligation
 
$
6,831

 
$
31

 
$
—

 
$
6,862

Mortgage-backed securities
 
105,328

 
401

 
(614
)
 
105,115

Total available-for-sale
 
200,758

 
1,667

 
(787
)
 
201,638

 
 
At December 31, 2015, mortgage-backed securities (“MBS”) with an estimated par value of $61.0 million and a fair value of $62.5 million were pledged as collateral for the Bank’s three inverse putable reverse repurchase agreements which totaled $28.5 million and Homeowner's Association ("HOA") reverse repurchase agreements which totaled $19.6 million.
 
The Company reviews individual securities classified as available-for-sale to determine whether a decline in fair value below the amortized cost basis is other-than-temporary.  If it is probable that the Company will be unable to collect all amounts due according to contractual terms of the debt security not impaired at acquisition, an OTTI shall be considered to have occurred.  If an OTTI occurs, the cost basis of the security will be written down to its fair value as the new cost basis and the write down accounted for as a realized loss.  We reviewed all securities in a loss position as of December 31, 2015 and 2014, and concluded their losses were a result of the level of market interest rates and not a result of credit deterioration or the underlying issuers ability to repay. Therefore there were no securities with OTTI as of December 31, 2015 or 2014.  The Company did not realize any OTTI recoveries or losses in 2015. The Company realized OTTI losses of $29,000 in 2014 and $4,000 in 2013.

During the years ended December 31, 2015, 2014 and 2013 the Company recognized gross gains on sales of available-for-sale securities and held-to-maturity securities in the amount of $317,000, $2.1 million and $2 million, respectively. During the years ended December 31, 2015, 2014 and 2013 the Company recognized gross losses on sales of available-for-sale securities and held-to-maturity securities in the amount of $27,000, $578,000 and $468,000, respectively. The Company had net proceeds from the sale or maturity of available-for-sale securities and held-to-maturity securities of $27.6 million, $166 million and $234 million during the years ended December 31, 2015, 2014 and 2013, respectively.

 
The table below shows the number, fair value and gross unrealized holding losses of the Company’s investment securities by investment category and length of time that the securities have been in a continuous loss position.
 
 
December 31, 2015
 
Less than 12 months
 
12 months or Longer
 
Total
 
Number
 
Fair
Value
 
Gross
Unrealized
Holding
Losses
 
Number
 
Fair
Value
 
Gross
Unrealized
Holding
Losses
 
Number
 
Fair
Value
 
Gross
Unrealized
Holding
Losses
 
(dollars in thousands)
Available-for-sale:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Municipal bonds
32

 
$
15,516

 
$
(61
)
 
6

 
$
3,349

 
$
(36
)
 
38

 
$
18,865

 
$
(97
)
Collateralized mortgage obligation
5

 
22,771

 
(183
)
 
—

 
—

 
—

 
5

 
22,771

 
(183
)
Mortgage-backed securities
34

 
83,488

 
(679
)
 
3

 
12,935

 
(432
)
 
37

 
96,423

 
(1,111
)
Total available-for-sale
71

 
$
121,775

 
$
(923
)
 
9

 
$
16,284

 
$
(468
)
 
80

 
$
138,059

 
$
(1,391
)
Held-to-maturity:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Mortgage-backed securities
1

 
$
8,330

 
$
(70
)
 
—

 
$
—

 
$
—

 
1

 
$
8,330

 
$
(70
)
Total held-to-maturity
1

 
$
8,330

 
$
(70
)
 
—

 
$
—

 
$
—

 
1

 
$
8,330

 
$
(70
)
Total securities
72

 
$
130,105

 
$
(993
)
 
9

 
$
16,284

 
$
(468
)
 
81

 
$
146,389

 
$
(1,461
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2014
 
Less than 12 months
 
12 months or Longer
 
Total
 
Number
 
Fair
Value
 
Gross
Unrealized
Holding
Losses
 
Number
 
Fair
Value
 
Gross
Unrealized
Holding
Losses
 
Number
 
Fair
Value
 
Gross
Unrealized
Holding
Losses
 
(dollars in thousands)
Available-for-sale:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Municipal bonds
35

 
$
18,129

 
$
(117
)
 
16

 
$
6,510

 
$
(56
)
 
51

 
$
24,639

 
$
(173
)
Mortgage-backed securities
7

 
24,353

 
(105
)
 
4

 
18,842

 
(509
)
 
11

 
43,195

 
(614
)
Total available-for-sale
42

 
$
42,482

 
$
(222
)
 
20

 
$
25,352

 
$
(565
)
 
62

 
$
67,834

 
$
(787
)


The amortized cost and estimated fair value of investment securities available for sale at December 31, 2015, by contractual maturity are shown in the table below.
 
 
 
One Year
or Less
 
More than One
Year to Five Years
 
More than Five Years
to Ten Years
 
More than
Ten Years
 
Total
 
 
Amortized
Cost
 
Fair
Value
 
Amortized
Cost
 
Fair
Value
 
Amortized
Cost
 
Fair
Value
 
Amortized
Cost
 
Fair
Value
 
Amortized
Cost
 
Fair
Value
 
 
(dollars in thousands)
Available-for-sale:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Municipal bonds
 
$
1,067

 
$
1,068

 
$
26,998

 
$
27,134

 
$
43,968

 
$
44,695

 
$
56,513

 
$
57,348

 
$
128,546

 
$
130,245

Collateralized mortgage obligation
 
—

 
—

 
—

 
—

 
—

 
—

 
24,722

 
24,543

 
24,722

 
24,543

Mortgage-backed securities
 
—

 
—

 
—

 
—

 
27,662

 
27,612

 
98,781

 
97,873

 
126,443

 
125,485

Total available-for-sale
 
1,067

 
1,068

 
26,998

 
27,134

 
71,630

 
72,307

 
180,016

 
179,764

 
279,711

 
280,273

Held-to-maturity:
 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Mortgage-backed securities
 
—

 
—

 
—

 
—

 
—

 
—

 
8,400

 
8,330

 
8,400

 
8,330

Other
 
—

 
—

 
—

 
—

 
—

 
—

 
1,242

 
1,242

 
1,242

 
1,242

Total held-to-maturity
 
—

 
—

 
—

 
—

 
—

 
—

 
9,642

 
9,572

 
9,642

 
9,572

Total securities
 
$
1,067

 
$
1,068

 
$
26,998

 
$
27,134

 
$
71,630

 
$
72,307

 
$
189,658

 
$
189,336

 
$
289,353

 
$
289,845



Unrealized gains and losses on investment securities available for sale are recognized in stockholders’ equity as accumulated other comprehensive income or loss.  At December 31, 2015, the Company had accumulated other comprehensive income of $562,000, or $332,000 net of tax, compared to accumulated other comprehensive loss of $880,000 or $518,000 net of tax, at December 31, 2014. 

FHLB, FRB, and other stock

At December 31, 2015, the Company had $11.4 million in Federal Home Loan Bank ("FHLB") stock, $7.9 million in Federal Reserve Bank ("FRB") stock, and $3.0 million in other stock, all carried at cost.  During the year ended December 31, 2015, the FHLB repurchased $16.4 million of the Company’s excess FHLB stock through their stock repurchase program.  During the years ended December 31, 2014 and 2013, the FHLB had repurchased $3.4 million and $4.3 million respectively, of the Company’s excess FHLB stock through their stock repurchase program. The Company evaluates its investments in FHLB and other stock for impairment periodically, including their capital adequacy and overall financial condition. No impairment losses have been recorded through December 31, 2015.