Note 3 - Investment Securities

The amortized cost and estimated fair values of investments in debt and equity securities are summarized in the following tables:


	September 30, 2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
	(in thousands)
Securities Available for Sale
Obligations of U.S. government corporations and agencies	$	377,072	$	9,800		—		$	386,872
Obligations of states and political subdivisions		116,752		3,634	$	(82	)		120,304
Marketable equity securities		3,000		33		—			3,033


Total securities available for sale	$	496,824	$	13,467	$	(82	)	$	510,209


Securities Held to Maturity
Obligations of U.S. government corporations and agencies	$	626,599	$	22,145		—		$	648,744
Obligations of states and political subdivisions		14,550		487		—			15,037


Total securities held to maturity	$	641,149	$	22,632		—		$	663,781


	December 31, 2015
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
	(in thousands)
Securities Available for Sale
Obligations of U.S. government corporations and agencies	$	312,917	$	2,761	$	(1,996	)	$	313,682
Obligations of states and political subdivisions		86,823		1,428		(33	)		88,218
Marketable equity securities		3,000		—		(15	)		2,985


Total securities available for sale	$	402,740	$	4,189	$	(2,044	)	$	404,885


Securities Held to Maturity
Obligations of U.S. government corporations and agencies	$	711,994	$	8,394	$	(2,882	)	$	717,506
Obligations of states and political subdivisions		14,536		277		(110	)		14,703


Total securities held to maturity	$	726,530	$	8,671	$	(2,992	)	$	732,209

No investment securities were sold during the nine months ended September 30, 2016 or the nine months ended September 30, 2015. Investment securities with an aggregate carrying value of $262,695,000 and $297,547,000 at September 30, 2016 and December 31, 2015, respectively, were pledged as collateral for specific borrowings, lines of credit and local agency deposits.

The amortized cost and estimated fair value of debt securities at September 30, 2016 by contractual maturity are shown below. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. At September 30, 2016, obligations of U.S. government corporations and agencies with a cost basis totaling $1,003,671,000 consist almost entirely of mortgage-backed securities whose contractual maturity, or principal repayment, will follow the repayment of the underlying mortgages. For purposes of the following table, the entire outstanding balance of these mortgage-backed securities issued by U.S. government corporations and agencies is categorized based on final maturity date. At September 30, 2016, the Company estimates the average remaining life of these mortgage-backed securities issued by U.S. government corporations and agencies to be approximately 4.4 years. Average remaining life is defined as the time span after which the principal balance has been reduced by half.


Investment Securities	Available for Sale				Held to Maturity
(In thousands)	Amortized Cost		Estimated Fair Value		Amortized Cost		Estimated Fair Value
Due in one year		—		—		—		—
Due after one year through five years	$	10,578	$	10,969	$	1,169	$	1,203
Due after five years through ten years		15,637		16,397		853		943
Due after ten years		470,609		482,843		639,127		661,635

Totals	$	496,824	$	510,209	$	641,149	$	663,781

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, were as follows:


	Less than 12 months					12 months or more				Total
September 30, 2016	Fair Value		Unrealized Loss			Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
						(in thousands)
Securities Available for Sale:
Obligations of U.S. government corporations and agencies		—		—			—		—		—		—
Obligations of states and political subdivisions	$	9,521	$	(82	)		—		—	$	9,521	$	(82	)
Marketable equity securities		—		—			—		—		—		—


Total securities available-for-sale	$	9,521	$	(82	)		—		—	$	9,521	$	(82	)


Securities Held to Maturity:
Obligations of U.S. government corporations and agencies		—		—			—		—		—		—
Obligations of states and political subdivisions		—		—			—		—		—		—


Total securities held-to-maturity		—		—			—		—		—		—


	Less than 12 months					12 months or more					Total
December 31, 2015	Fair Value		Unrealized Loss			Fair Value		Unrealized Loss			Fair Value		Unrealized Loss
	(in thousands)
Securities Available for Sale:
Obligations of U.S. government corporations and agencies	$	193,306	$	(1,996	)		—		—		$	193,306	$	(1,996	)
Obligations of states and political subdivisions		6,469		(33	)		—		—			6,469		(33	)
Marketable equity securities		2,985		(15	)		—		—			2,985		(15	)


Total securities available-for-sale	$	202,760	$	(2,044	)		—		—		$	202,760	$	(2,044	)


Securities Held to Maturity:
Obligations of U.S. government corporations and agencies	$	198,481	$	(2,882	)		—		—		$	198,481	$	(2,882	)
Obligations of states and political subdivisions		497		(11	)	$	1,121	$	(99	)		1,618		(110	)


Total securities held-to-maturity	$	198,978	$	(2,893	)	$	1,121	$	(99	)	$	200,099	$	(2,992	)

Obligations of U.S. government corporations and agencies: Unrealized losses on investments in obligations of U.S. government corporations and agencies are caused by interest rate increases. The contractual cash flows of these securities are guaranteed by U.S. Government Sponsored Entities (principally Fannie Mae and Freddie Mac). It is expected that the securities would not be settled at a price less than the amortized cost of the investment. Because the decline in fair value is attributable to changes in interest rates and not credit quality, and because the Company does not intend to sell and more likely than not will not be required to sell, these investments are not considered other-than-temporarily impaired. At September 30, 2016, no debt securities representing obligations of U.S. government corporations and agencies had unrealized losses.

Obligations of states and political subdivisions: The unrealized losses on investments in obligations of states and political subdivisions were caused by increases in required yields by investors in these types of securities. It is expected that the securities would not be settled at a price less than the amortized cost of the investment. Because the decline in fair value is attributable to changes in interest rates and not credit quality, and because the Company does not intend to sell and more likely than not will not be required to sell, these investments are not considered other-than-temporarily impaired. At September 30, 2016, 11 debt securities representing obligations of states and political subdivisions had unrealized losses with aggregate depreciation of (0.85%) from the Company’s amortized cost basis.

Marketable equity securities: At September 30, 2016, no marketable equity securities had unrealized losses.