SECURITIES

Securities are classified as held-to-maturity, trading, or available-for-sale at the time of purchase. Securities classified as held-to-maturity are securities for which management has the intent and ability to hold to maturity and are stated at cost.

The Company's trading securities consist of diversified investment securities reported at fair value that are held in a grantor trust under deferred compensation arrangements in which plan participants may direct amounts earned to be invested in securities other than Company stock.

All other securities are classified as available-for-sale and are carried at fair value with unrealized gains and losses, net of related deferred income taxes, recorded in stockholders' equity as a separate component of accumulated other comprehensive loss.

A summary of the Company's securities portfolio by category and maturity is presented in the following tables.

Securities Portfolio

(Dollar amounts in thousands)



	As of September 30, 2015									As of December 31, 2014
	Amortized Cost		Gross Unrealized					Fair Value		Amortized Cost		Gross Unrealized					Fair Value
	Amortized Cost		Gains		Losses			Fair Value		Amortized Cost		Gains		Losses			Fair Value
Securities Available-for-Sale
U.S. treasury securities	$	1,999	$	—	$	—		$	1,999	$	—	$	—	$	—		$	—
U.S. agency securities	18,289		337		(3		)	18,623		30,297		144		(10		)	30,431
Collateralized mortgage obligations ("CMOs")	545,992		3,765		(3,282		)	546,475		538,882		2,256		(6,982		)	534,156
Other mortgage-backed securities ("MBSs")	164,326		3,290		(235		)	167,381		155,443		4,632		(310		)	159,765
Municipal securities	375,323		6,880		(649		)	381,554		414,255		10,583		(1,018		)	423,820
Trust preferred collateralized debt obligations ("CDOs")	48,159		37		(16,326		)	31,870		48,502		152		(14,880		)	33,774
Corporate debt securities	—		—		—			—		1,719		83		—			1,802
Equity securities	3,446		93		(23		)	3,516		3,224		72		(35		)	3,261
Total available- for-sale securities	$	1,157,534	$	14,402	$	(20,518	)	$	1,151,418	$	1,192,322	$	17,922	$	(23,235	)	$	1,187,009
Securities Held-to-Maturity
Municipal securities	$	23,723	$	—	$	(15	)	$	23,708	$	26,555	$	1,115	$	—		$	27,670
Trading Securities								$	17,038								$	17,460

Remaining Contractual Maturity of Securities

(Dollar amounts in thousands)



	As of September 30, 2015
	Available-for-Sale				Held-to-Maturity
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
One year or less	$	135,762	$	132,787	$	2,223	$	2,222
After one year to five years	246,191		240,797		8,727		8,721
After five years to ten years	13,658		13,358		4,476		4,473
After ten years	48,159		47,104		8,297		8,292
Securities that do not have a single contractual maturity date	713,764		717,372		—		—
Total	$	1,157,534	$	1,151,418	$	23,723	$	23,708

The carrying value of securities available-for-sale that were pledged to secure deposits or for other purposes as permitted or required by law totaled $1.0 billion at September 30, 2015 and $779.4 million at December 31, 2014. No securities held-to-maturity were pledged as of September 30, 2015 or December 31, 2014.

Purchases and sales of securities are recognized on a trade date basis. Realized securities gains or losses are reported in net securities gains in the Condensed Consolidated Statements of Income. The cost of securities sold is based on the specific identification method. During the quarters and nine months ended September 30, 2015 and 2014 there were no material gross trading gains (losses). The following table presents net realized gains on available-for-sale securities for the quarters and nine months ended September 30, 2015 and 2014.

Available-for-Sale Securities Gains (Losses)

(Dollar amounts in thousands)



	Quarters Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015			2014
Gains (losses) on sales of securities:
Gross realized gains	$	524	$	2,570	$	1,689		$	8,188
Gross realized losses	—		—		(138		)	—
Net realized gains on sales of securities	524		2,570		1,551			8,188
Non-cash impairment charges:
Other-than-temporary securities impairment ("OTTI")	—		—		—			(28		)
Net realized gains	$	524	$	2,570	$	1,551		$	8,160

Accounting guidance requires that the credit portion of an OTTI charge be recognized through income. If a decline in fair value below carrying value is not attributable to credit deterioration and the Company does not intend to sell the security or believe it would not be more likely than not required to sell the security prior to recovery, the Company records the non-credit related portion of the decline in fair value in other comprehensive income.

The following table presents a rollforward of life-to-date OTTI recognized in earnings related to all available-for-sale securities held by the Company for the quarters and nine months ended September 30, 2015 and 2014. The majority of the beginning and ending balance of OTTI relates to CDOs currently held by the Company.

Changes in OTTI Recognized in Earnings

(Dollar amounts in thousands)



	Quarters Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015			2014
Beginning balance	$	23,709	$	23,880	$	23,880		$	32,422
OTTI included in earnings ⁽¹⁾:
Losses on securities that previously had OTTI	—		—		—			28
Reduction for sales of securities ⁽²⁾	—		—		(171		)	(8,570		)
Ending balance	$	23,709	$	23,880	$	23,709		$	23,880


⁽¹⁾	Included in net securities gains in the Condensed Consolidated Statements of Income.


⁽²⁾	During the nine months ended September 30, 2015, the Company sold one CMO with a carrying value of $1.3 million that had OTTI of $171,000 that was previously recognized in earnings. The Company sold one CDO with a carrying value of $1.3 million during the nine months ended September 30, 2014 that had OTTI of $8.6 million that was previously recognized in earnings.

The following table presents the aggregate amount of unrealized losses and the aggregate related fair values of securities with unrealized losses as of September 30, 2015 and December 31, 2014.

Securities in an Unrealized Loss Position

(Dollar amounts in thousands)



		Less Than 12 Months				Greater Than 12 Months				Total
	Number of Securities	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
As of September 30, 2015
U.S. agency securities	1	$	2,037	$	3	$	—	$	—	$	2,037	$	3
CMOs	53	38,105		156		197,119		3,126		235,224		3,282
MBSs	6	20,003		64		9,699		171		29,702		235
Municipal securities	109	11,540		96		43,657		553		55,197		649
CDOs	8	1,693		172		28,444		16,154		30,137		16,326
Equity securities	1	—		—		2,319		23		2,319		23
Total	178	$	73,378	$	491	$	281,238	$	20,027	$	354,616	$	20,518
As of December 31, 2014
U.S. agency securities	1	$	1,943	$	10	$	—	$	—	$	1,943	$	10
CMOs	87	61,321		559		284,327		6,423		345,648		6,982
MBSs	11	1,113		1		39,043		309		40,156		310
Municipal securities	91	1,317		9		53,987		1,009		55,304		1,018
CDOs	4	—		—		22,791		14,880		22,791		14,880
Equity securities	1	—		—		2,270		35		2,270		35
Total	195	$	65,694	$	579	$	402,418	$	22,656	$	468,112	$	23,235

Substantially all of the Company's CMOs and other MBSs are either backed by U.S. government-owned agencies or issued by U.S. government-sponsored enterprises. Municipal securities are issued by municipal authorities, and the majority are supported by third party insurance or some other form of credit enhancement. Management does not believe any of these securities with unrealized losses as of September 30, 2015 represent OTTI related to credit deterioration. These unrealized losses are attributed to changes in interest rates and temporary market movements. The Company does not intend to sell these securities and it is not more likely than not that the Company will be required to sell them before recovery of their amortized cost basis, which may be at maturity.

The unrealized losses on CDOs as of September 30, 2015 reflect changes in market activity for these securities. Management does not believe these unrealized losses represent OTTI related to credit deterioration. In addition, the Company does not intend to sell the CDOs with unrealized losses within a short period of time, and the Company does not believe it is more likely than not that it will be required to sell them before recovery of their amortized cost basis, which may be at maturity. Significant judgment is required to calculate the fair value of the CDOs, all of which are pooled. For a detailed discussion of the CDO valuation methodology, see Note 12, "Fair Value."