Note 4 - Investment Securities

The amortized cost, gross unrealized gains and losses, and estimated fair values of investment securities available for sale at June 30, 2014 and December 31, 2013 are summarized below.



	June 30, 2014
(in thousands)	Amortized Cost⁽¹⁾		Gross Unrealized Gains	Gross Unrealized Losses		Fair Value
U.S. Treasury securities	$	17,793	—	—		17,793
U.S. Government agency securities	33,264		1,028	—		34,292
Securities issued by U.S. Government sponsored enterprises	111,795		1,014	—		112,809
Mortgage-backed securities issued by U.S. Government agencies	173,296		1,848	(766	)	174,378
Mortgage-backed securities issued by U.S. Government sponsored enterprises	2,327,735		21,176	(10,616	)	2,338,295
Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises	384,836		4,125	(2,488	)	386,473
State and municipal securities	5,222		209	(2	)	5,429
Equity securities	3,228		3,725	—		6,953
Other investments	4,099		—	(336	)	3,763
Total investment securities available for sale	$	3,061,268	33,125	(14,208	)	3,080,185

	December 31, 2013
(in thousands)	Amortized Cost⁽¹⁾		Gross Unrealized Gains	Gross Unrealized Losses		Fair Value
U.S. Treasury securities	$	17,791	—	—		17,791
U.S. Government agency securities	33,480		1,161	—		34,641
Securities issued by U.S. Government sponsored enterprises	112,305		1,440	—		113,745
Mortgage-backed securities issued by U.S. Government agencies	196,521		2,257	(3,661	)	195,117
Mortgage-backed securities issued by U.S. Government sponsored enterprises	2,443,282		9,718	(31,640	)	2,421,360
Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises	406,717		698	(8,875	)	398,540
State and municipal securities	6,723		168	(2	)	6,889
Equity securities	3,856		3,728	—		7,584
Other investments	4,074		—	(383	)	3,691
Total investment securities available for sale	$	3,224,749	19,170	(44,561	)	3,199,358


⁽¹⁾	Amortized cost is adjusted for other-than-temporary impairment charges in 2014 and 2013, which have been recognized in the consolidated statements of income in the applicable year, and were considered inconsequential.

At June 30, 2014 and December 31, 2013, investment securities with a carrying value of $2.15 billion and $2.33 billion respectively, were pledged to secure certain deposits and securities sold under repurchase agreements as required by law and contractual agreements.

Synovus has reviewed investment securities that are in an unrealized loss position as of June 30, 2014 and December 31, 2013 for OTTI and does not consider any securities in an unrealized loss position to be other-than-temporarily impaired. If Synovus intended to sell a security in an unrealized loss position, the entire unrealized loss would be reflected in income. Synovus does not intend to sell investment securities in an unrealized loss position prior to the recovery of the unrealized loss, which may be until maturity, and has the ability and intent to hold those securities for that period of time. Additionally, Synovus is not currently aware of any circumstances which will require it to sell any of the securities that are in an unrealized loss position.

Declines in the fair value of available for sale securities below their cost that are deemed to have OTTI are reflected in earnings as realized losses to the extent the impairment is related to credit losses. The amount of the impairment related to other factors is recognized in other comprehensive income. Currently, unrealized losses on debt securities are attributable to increases in interest rates on comparable securities from the date of purchase. Synovus regularly evaluates its investment securities portfolio to ensure that there are no conditions that would indicate that unrealized losses represent OTTI. These factors include the length of time the security has been in a loss position, the extent that the fair value is below amortized cost, and the credit standing of the issuer. As of June 30, 2014, Synovus had one investment security in a loss position for less than twelve months and forty-six investment securities in a loss position for twelve months or longer.

Gross unrealized losses on investment 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, 2014 and December 31, 2013, are presented below.



	June 30, 2014
	Less than 12 Months			12 Months or Longer		Total
(in thousands)	Fair Value		Gross Unrealized Losses	Fair Value	Gross Unrealized Losses	Fair Value	Gross Unrealized Losses
U.S. Treasury securities	$	—	—	—	—	—	—
U.S. Government agency securities	—		—	—	—	—	—
Securities issued by U.S. Government sponsored enterprises	—		—	—	—	—	—
Mortgage-backed securities issued by U.S. Government agencies	—		—	30,922	766	30,922	766
Mortgage-backed securities issued by U.S. Government sponsored enterprises	—		—	1,052,375	10,616	1,052,375	10,616
Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises	—		—	125,675	2,488	125,675	2,488
State and municipal securities	—		—	42	2	42	2
Equity securities	—		—	—	—	—	—
Other investments	1,897		202	1,866	134	3,763	336
Total	$	1,897	202	1,210,880	14,006	1,212,777	14,208

	December 31, 2013
	Less than 12 Months			12 Months or Longer		Total
(in thousands)	Fair Value		Gross Unrealized Losses	Fair Value	Gross Unrealized Losses	Fair Value	Gross Unrealized Losses
U.S. Treasury securities	$	—	—	—	—	—	—
U.S. Government agency securities	—		—	—	—	—	—
Securities issued by U.S. Government sponsored enterprises	—		—	—	—	—	—
Mortgage-backed securities issued by U.S. Government agencies	121,607		3,363	2,951	298	124,558	3,661
Mortgage-backed securities issued by U.S. Government sponsored enterprises	1,885,521		31,640	—	—	1,885,521	31,640
Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises	282,898		8,875	—	—	282,898	8,875
State and municipal securities	—		—	40	2	40	2
Equity securities	—		—	—	—	—	—
Other investments	1,969		105	1,722	278	3,691	383
Total	$	2,291,995	43,983	4,713	578	2,296,708	44,561

The amortized cost and fair value by contractual maturity of investment securities available for sale at June 30, 2014 are shown below. The expected life of mortgage-backed securities or CMOs may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. For purposes of the maturity table, mortgage-backed securities and CMOs, which are not due at a single maturity date, have been classified based on the final contractual maturity date.



	Distribution of Maturities at June 30, 2014
(in thousands)	Within One Year		1 to 5 Years	5 to 10 Years	More Than 10 Years	No Stated Maturity	Total
Amortized Cost
U.S. Treasury securities	$	17,793	—	—	—	—	17,793
U.S. Government agency securities	114		9,097	24,053	—	—	33,264
Securities issued by U.S. Government sponsored enterprises	30,030		81,765	—	—	—	111,795
Mortgage-backed securities issued by U.S. Government agencies	15		1	—	173,280	—	173,296
Mortgage-backed securities issued by U.S. Government sponsored enterprises	102		2,429	1,913,531	411,673	—	2,327,735
Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises	—		—	—	384,836	—	384,836
State and municipal securities	95		2,098	289	2,740	—	5,222
Equity securities	—		—	—	—	3,228	3,228
Other investments	—		—	—	2,000	2,099	4,099
Total amortized cost	$	48,149	95,390	1,937,873	974,529	5,327	3,061,268
Fair Value
U.S. Treasury securities	$	17,793	—	—	—	—	17,793
U.S. Government agency securities	114		9,414	24,764	—	—	34,292
Securities issued by U.S. Government sponsored enterprises	30,187		82,622	—	—	—	112,809
Mortgage-backed securities issued by U.S. Government agencies	15		1	—	174,362	—	174,378
Mortgage-backed securities issued by U.S. Government sponsored enterprises	108		2,595	1,913,923	421,669	—	2,338,295
Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises	—		—	—	386,473	—	386,473
State and municipal securities	95		2,139	308	2,887	—	5,429
Equity securities	—		—	—	—	6,953	6,953
Other investments	—		—	—	1,866	1,897	3,763
Total fair value	$	48,312	96,771	1,938,995	987,257	8,850	3,080,185

Proceeds from sales, gross gains, and gross losses on sales of securities available for sale for the six and three months ended June 30, 2014 and 2013 are presented below. Other-than-temporary impairment charges of $88 thousand are included in gross realized losses for the six months ended June 30, 2014. The specific identification method is used to reclassify gains and losses out of other comprehensive income at the time of sale.



	Six Months Ended June 30,					Three Months Ended June 30,
(in thousands)	2014			2013		2014	2013
Proceeds from sales of investment securities available for sale	$	20,815		$347,386		—	135,146
Gross realized gains	1,419			2,036		—	1,760
Gross realized losses	(88		)	(588	)	—	(357	)
Investment securities gains, net	$	1,331		1,448		—	1,403