2. INVESTMENT SECURITIES

The carrying amounts and fair values of investment securities at March 31, 2017 and December 31, 2016 are summarized as follows:



	March 31, 2017
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Fair Value
	(in thousands)
Held-to-maturity
Tax-exempt	$	102,590	$	1,388	$	(312	)	$	103,666

Available-for-sale
Collateralized debt obligations	$	50	$	19,973	$	—		$	20,023
Commercial MBS issued by GSEs	119,646		15		(3,961		)	115,700
Corporate debt securities	69,643		370		(1,618		)	68,395
CRA investments	47,722		—		(514		)	47,208
Preferred stock	96,030		2,819		(247		)	98,602
Private label residential MBS	504,213		419		(7,566		)	497,066
Residential MBS issued by GSEs	1,375,584		3,349		(16,133		)	1,362,800
Tax-exempt	403,302		9,760		(8,947		)	404,115
Trust preferred securities	32,000		—		(4,320		)	27,680
U.S. government sponsored agency securities	59,000		—		(3,080		)	55,920
U.S. treasury securities	2,496		6		—			2,502
Total AFS securities	$	2,709,686	$	36,711	$	(46,386	)	$	2,700,011

Securities measured at fair value
Residential MBS issued by GSEs								$	1,019



	December 31, 2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Fair Value
	(in thousands)
Held-to-maturity
Tax-exempt	$	92,079	$	433	$	(546	)	$	91,966

Available-for-sale
Collateralized debt obligations	$	50	$	13,440	$	—		$	13,490
Commercial MBS issued by GSEs	121,742		—		(3,950		)	117,792
Corporate debt securities	65,058		371		(1,285		)	64,144
CRA investments	37,627		—		(514		)	37,113
Preferred stock	96,071		833		(2,242		)	94,662
Private label residential MBS	440,272		182		(6,769		)	433,685
Residential MBS issued by GSEs	1,369,289		3,046		(17,130		)	1,355,205
Tax-exempt	409,693		8,477		(9,937		)	408,233
Trust preferred securities	32,000		—		(5,468		)	26,532
U.S. government sponsored agency securities	59,000		—		(2,978		)	56,022
U.S. treasury securities	2,496		6		—			2,502
Total AFS securities	$	2,633,298	$	26,355	$	(50,273	)	$	2,609,380

Securities measured at fair value
Residential MBS issued by GSEs								$	1,053

For additional information on the fair value changes of securities measured at fair value, see the trading securities table in "Note 13. Fair Value Accounting" of these Notes to Unaudited Consolidated Financial Statements.

The Company conducts an OTTI analysis on a quarterly basis. The initial indication of OTTI for both debt and equity securities is a decline in the market value below the amount recorded for an investment, and taking into account the severity and duration of the decline. Another potential indication of OTTI is a downgrade below investment grade. In determining whether an impairment is OTTI, the Company considers the length of time and the extent to which the market value has been below cost, recent events specific to the issuer, including investment downgrades by rating agencies and economic conditions of its industry, and the Company’s ability and intent to hold the investment for a period of time sufficient to allow for any anticipated recovery. For marketable equity securities, the Company also considers the issuer’s financial condition, capital strength, and near-term prospects.

For debt securities, for the purpose of an OTTI analysis, the Company also considers the cause of the price decline (general level of interest rates, credit spreads, and industry and issuer-specific factors), the issuer’s financial condition, near-term prospects, and current ability to make future payments in a timely manner, as well as the issuer’s ability to service debt, and any change in agencies’ ratings at the evaluation date from the acquisition date and any likely imminent action.

The Company has reviewed securities for which there is an unrealized loss in accordance with its accounting policy for OTTI described above and determined that there are no impairment charges for the three months ended March 31, 2017 and 2016. The Company does not consider any securities to be other-than-temporarily impaired as of March 31, 2017 and December 31, 2016. No assurance can be made that OTTI will not occur in future periods.

Information pertaining to securities with gross unrealized losses at March 31, 2017 and December 31, 2016, aggregated by investment category and length of time that individual securities have been in a continuous loss position follows:



	March 31, 2017
	Less Than Twelve Months				More Than Twelve Months				Total
	Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value
	(in thousands)
Held-to-maturity
Tax-exempt	$	312	$	30,542	$	—	$	—	$	312	$	30,542
Available-for-sale
Commercial MBS issued by GSEs	$	3,961	$	113,795	$	—	$	—	$	3,961	$	113,795
Corporate debt securities	1,618		62,971		—		—		1,618		62,971
CRA investments	514		47,208		—		—		514		47,208
Preferred stock	247		11,946		—		—		247		11,946
Private label residential MBS	7,566		391,073		—		—		7,566		391,073
Residential MBS issued by GSEs	15,699		868,033		434		33,662		16,133		901,695
Tax-exempt	8,947		142,516		—		—		8,947		142,516
Trust preferred securities	—		—		4,320		27,680		4,320		27,680
U.S. government sponsored agency securities	3,080		55,920		—		—		3,080		55,920
Total AFS securities	$	41,632	$	1,693,462	$	4,754	$	61,342	$	46,386	$	1,754,804



	December 31, 2016
	Less Than Twelve Months				More Than Twelve Months				Total
	Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value
	(in thousands)
Held-to-maturity
Tax-exempt	$	546	$	30,364	$	—	$	—	$	546	$	30,364
Available-for-sale
Commercial MBS issued by GSEs	$	3,950	$	117,792	$	—	$	—	$	3,950	$	117,792
Corporate debt securities	1,285		38,716		—		—		1,285		38,716
CRA investments	514		37,113		—		—		514		37,113
Preferred stock	2,188		63,151		54		1,471		2,242		64,622
Private label residential MBS	6,170		377,638		599		16,969		6,769		394,607
Residential MBS issued by GSEs	16,990		950,480		140		5,326		17,130		955,806
Tax-exempt	9,937		148,780		—		—		9,937		148,780
Trust preferred securities	—		—		5,468		26,532		5,468		26,532
U.S. government sponsored agency securities	2,978		56,022		—		—		2,978		56,022
Total AFS securities	$	44,012	$	1,789,692	$	6,261	$	50,298	$	50,273	$	1,839,990

At March 31, 2017 and December 31, 2016, the Company’s unrealized losses relate primarily to interest rate fluctuations and credit spread widening in applicable markets. The total number of securities in an unrealized loss position at March 31, 2017 is 204, compared to 244 at December 31, 2016. In analyzing an issuer’s financial condition, management considers whether the securities are issued by the federal government or its agencies, whether downgrades by bond rating agencies have occurred, and industry analysis reports. Since material downgrades have not occurred and management does not intend to sell the debt securities in an unrealized loss position in the foreseeable future, none of the securities described in the above table or in this paragraph are deemed to be OTTI.

The trust preferred securities have yields based on floating rate LIBOR, which are highly correlated to the federal funds rate and have been negatively affected by the low rate environment. This has resulted in unrealized losses for these securities.

The amortized cost and fair value of securities as of March 31, 2017, by contractual maturities, are shown below. MBS are shown separately as individual MBS are comprised of pools of loans with varying maturities. Therefore, these securities are listed separately in the maturity summary.



	March 31, 2017
	Amortized Cost		Estimated Fair Value
	(in thousands)
Held-to-maturity
After ten years	$	102,590	$	103,666

Available-for-sale
Due in one year or less	$	50,000	$	49,549
After one year through five years	52,331		53,380
After five years through ten years	214,862		214,145
After ten years	393,050		407,371
Mortgage-backed securities	1,999,443		1,975,566
Total AFS securities	$	2,709,686	$	2,700,011

The following tables summarize the carrying amount of the Company’s investment ratings position as of March 31, 2017 and December 31, 2016:



	March 31, 2017
	AAA		Split-rated AAA/AA+		AA+ to AA-		A+ to A-		BBB+ to BBB-		BB+ and below		Unrated		Totals
	(in thousands)
Held-to-maturity
Tax-exempt	$	—	$	—	$	—	$	—	$	—	$	—	$	102,590	$	102,590

Available-for-sale
Collateralized debt obligations	$	—	$	—	$	—	$	—	$	—	$	20,023	$	—	$	20,023
Commercial MBS issued by GSEs	—		115,700		—		—		—		—		—		115,700
Corporate debt securities	—		—		—		44,561		19,300		—		4,534		68,395
CRA investments	—		24,940		—		—		—		—		22,268		47,208
Preferred stock	—		—		—		10,550		64,715		7,311		16,026		98,602
Private label residential MBS	464,029		—		27,457		1,896		3,684		—		—		497,066
Residential MBS issued by GSEs	—		1,362,800		—		—		—		—		—		1,362,800
Tax-exempt	36,121		24,985		222,352		120,657		—		—		—		404,115
Trust preferred securities	—		—		—		—		27,680		—		—		27,680
U.S. government sponsored agency securities	—		55,920		—		—		—		—		—		55,920
U.S. treasury securities	—		2,502		—		—		—		—		—		2,502
Total AFS securities (1)	$	500,150	$	1,586,847	$	249,809	$	177,664	$	115,379	$	27,334	$	42,828	$	2,700,011

Securities measured at fair value
Residential MBS issued by GSEs	$	—	$	1,019	$	—	$	—	$	—	$	—	$	—	$	1,019


(1)	Where ratings differ, the Company uses an average of the ratings by S&P, Moody’s, and/or Fitch.



	December 31, 2016
	AAA		Split-rated AAA/AA+		AA+ to AA-		A+ to A-		BBB+ to BBB-		BB+ and below		Unrated		Totals
	(in thousands)
Held-to-maturity
Tax-exempt	$	—	$	—	$	—	$	—	$	—	$	—	$	92,079	$	92,079
Available-for-sale
Collateralized debt obligations	$	—	$	—	$	—	$	—	$	—	$	13,490	$	—	$	13,490
Commercial MBS issued by GSEs	—		117,792		—		—		—		—		—		117,792
Corporate debt securities	—		—		5,429		38,715		20,000		—		—		64,144
CRA investments	—		—		—		—		—		—		37,113		37,113
Preferred stock	—		—		—		—		64,486		14,658		15,518		94,662
Private label residential MBS	399,013		—		29,921		2,117		2,634		—		—		433,685
Residential MBS issued by GSEs	—		1,355,205		—		—		—		—		—		1,355,205
Tax-exempt	80,862		—		268,249		59,122		—		—		—		408,233
Trust preferred securities	—		—		—		—		26,532		—		—		26,532
U.S. government sponsored agency securities	—		56,022		—		—		—		—		—		56,022
U.S. treasury securities	—		2,502		—		—		—		—		—		2,502
Total AFS securities (1)	$	479,875	$	1,531,521	$	303,599	$	99,954	$	113,652	$	28,148	$	52,631	$	2,609,380

Securities measured at fair value
Residential MBS issued by GSEs	$	—	$	1,053	$	—	$	—	$	—	$	—	$	—	$	1,053


(1)	Where ratings differ, the Company uses an average of the ratings by S&P, Moody’s, and/or Fitch.

Securities with carrying amounts of approximately $902.6 million and $763.0 million at March 31, 2017 and December 31, 2016, respectively, were pledged for various purposes as required or permitted by law.

The following table presents gross gains and losses on sales of investment securities:



	Three Months Ended March 31,
	2017			2016
	(in thousands)
Gross gains	$	636		$	2,057
Gross losses	(1		)	(1,056		)
Net gains on sales of investment securities	$	635		$	1,001