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Investment Securities
12 Months Ended
Dec. 31, 2017
Investments, Debt and Equity Securities [Abstract]  
Investment Securities
Investment Securities
The Company’s investment policy is designed primarily to provide and maintain liquidity, generate a favorable return on assets without incurring undue interest rate and credit risk, and complement the Bank’s lending activities.
(a) Securities by Type and Maturity
The amortized cost, gross unrealized gains, gross unrealized losses and fair values of investment securities available for sale at the dates indicated were as follows:
 
Amortized
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Fair
Value
 
(In thousands)
December 31, 2017
 
 
 
 
 
 
 
U.S. Treasury and U.S. Government-sponsored agencies
$
13,460

 
$
6

 
$
(24
)
 
$
13,442

Municipal securities
247,358

 
3,720

 
(1,063
)
 
250,015

Mortgage-backed securities and collateralized mortgage obligations (1):
 
 
 
 
 
 

Residential
282,724

 
422

 
(2,935
)
 
280,211

Commercial
219,696

 
444

 
(3,061
)
 
217,079

Collateralized loan obligations
4,561

 
19

 

 
4,580

Corporate obligations
16,594

 
220

 
(44
)
 
16,770

Other securities (2)
27,781

 
652

 

 
28,433

Total
$
812,174


$
5,483


$
(7,127
)

$
810,530

 
 
 
 
 
 
 
 
December 31, 2016
 
 
 
 
 
 
 
U.S. Treasury and U.S. Government-sponsored agencies
$
1,563

 
$
6

 
$

 
$
1,569

Municipal securities
237,305

 
2,427

 
(2,476
)
 
237,256

Mortgage-backed securities and collateralized mortgage obligations (1):
 
 
 
 
 
 

Residential
310,391

 
985

 
(2,200
)
 
309,176

Commercial
211,259

 
599

 
(3,540
)
 
208,318

Collateralized loan obligations
10,505

 
4

 
(31
)
 
10,478

Corporate obligations
16,611

 
104

 
(9
)
 
16,706

Other securities (2)
11,005

 
156

 
(19
)
 
11,142

Total
$
798,639


$
4,281


$
(8,275
)

$
794,645

(1) Issued and guaranteed by U.S. Government-sponsored agencies.
(2) Primarily asset-backed securities issued and guaranteed by U.S. Government-sponsored agencies.
There were no securities classified as trading or held to maturity at December 31, 2017 or December 31, 2016.
The amortized cost and fair value of investment securities available for sale at December 31, 2017, by contractual maturity, are set forth below. Actual maturities may differ from contractual maturities because certain borrowers have the right to call or prepay obligations with or without call or prepayment penalties.
 
Amortized Cost
 
Fair Value
 
(In thousands)
Due in one year or less
$
8,922

 
$
8,982

Due after one year through five years
132,271

 
132,497

Due after five years through ten years
240,089

 
238,613

Due after ten years
430,847

 
430,292

Investment securities with no stated maturities
45

 
146

Total
$
812,174


$
810,530


(b) Unrealized Losses and Other-Than-Temporary Impairments
The following table shows the gross unrealized losses and fair value of the Company's investment securities available for sale that are not deemed to be other-than-temporarily impaired, aggregated by investment category and length of time that the individual securities have been in continuous unrealized loss positions as of December 31, 2017 and December 31, 2016:
 
Less than 12 Months
 
12 Months or Longer
 
Total
 
Fair
Value
 
Unrealized
Losses
 
Fair
Value
 
Unrealized
Losses
 
Fair
Value
 
Unrealized
Losses
 
(In thousands)
December 31, 2017
 
 
 
 
 
 
 
 
 
 
 
U.S. Treasury and U.S. Government-sponsored agencies
$
11,436

 
$
(24
)
 
$

 
$

 
$
11,436

 
$
(24
)
Municipal securities
39,298

 
(384
)
 
26,509

 
(679
)
 
65,807

 
(1,063
)
Mortgage-backed securities and collateralized mortgage obligations (1):
 
 
 
 
 
 
 
 

 

Residential
175,847

 
(1,296
)
 
66,380

 
(1,639
)
 
242,227

 
(2,935
)
Commercial
75,121

 
(700
)
 
90,822

 
(2,361
)
 
165,943

 
(3,061
)
Corporate obligations
3,472

 
(44
)
 

 

 
3,472

 
(44
)
Total
$
305,174


$
(2,448
)

$
183,711


$
(4,679
)

$
488,885


$
(7,127
)
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2016
 
 
 
 
 
 
 
 
 
 
 
Municipal securities
$
90,188

 
$
(2,476
)
 
$

 
$

 
$
90,188

 
$
(2,476
)
Mortgage-backed securities and collateralized mortgage obligations (1):
 
 
 
 
 
 
 
 
 
 
 
Residential
181,562

 
(2,148
)
 
10,854

 
(52
)
 
192,416

 
(2,200
)
Commercial
157,055

 
(3,446
)
 
12,597

 
(94
)
 
169,652

 
(3,540
)
Collateralized loan obligations
2,976

 
(1
)
 
2,969

 
(30
)
 
5,945

 
(31
)
Corporate obligations
4,032

 
(9
)
 

 

 
4,032

 
(9
)
Other securities (2)
6,998

 
(19
)
 

 

 
6,998

 
(19
)
Total
$
442,811


$
(8,099
)

$
26,420


$
(176
)

$
469,231


$
(8,275
)
(1) Issued and guaranteed by U.S. Government-sponsored agencies.
(2) Primarily asset-backed securities issued and guaranteed by U.S. Government-sponsored agencies.
The Company has evaluated these investment securities available for sale as of December 31, 2017 and December 31, 2016 and has determined that the decline in their value is not other-than-temporary. The unrealized losses are primarily due to increases in market interest rates. The fair value of these securities is expected to recover as the securities approach their maturity date. None of the underlying issuers of the municipal securities had credit ratings that were below investment grade levels at December 31, 2017 or December 31, 2016. The Company has the ability and intent to hold the investments until recovery of the securities' amortized cost which may be the maturity date of the securities.
For the years ended December 31, 2017, 2016 and 2015 there were no other-than-temporary charges recorded to net income.

(c) Realized Gains and Losses
The following table presents the gross realized gains and losses on the sale of securities available for sale for the years ended December 31, 2017, 2016 and 2015:

 
Year ended December 31,
 
2017
 
2016
 
2015
 
(In thousands)
Gross realized gains
$
193

 
$
1,518

 
$
2,109

Gross realized losses
(187
)
 
(203
)
 
(593
)
Net realized gains
$
6

 
$
1,315

 
$
1,516


(d) Pledged Securities
The following table summarizes the amortized cost and fair value of investment securities available for sale that are pledged as collateral for the following obligations at December 31, 2017 and December 31, 2016:
 
December 31, 2017
 
December 31, 2016
 
Amortized
Cost
 
Fair
Value
 
Amortized
Cost
 
Fair
Value
 
(In thousands)
Washington and Oregon state to secure public deposits
$
206,377

 
$
206,425

 
$
214,834

 
$
215,247

Repurchase agreements
48,750

 
48,237

 
29,481

 
29,294

Other securities pledged
12,484

 
12,498

 
3,557

 
3,546

Total
$
267,611


$
267,160


$
247,872


$
248,087