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Investment Securities
 9 Months Ended
Sep. 30, 2017
Investment Securities [Abstract]  
Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]
Investment Securities
Securities Available for Sale
Below is an analysis of the amortized cost and estimated fair values of securities available for sale at:
 
September 30, 2017
 
December 31, 2016
 
Amortized
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Estimated
Fair Value
 
Amortized
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Estimated
Fair Value
 
(dollars in thousands)
Obligations of U.S. Government Agencies:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Mortgage-Backed Securities – Residential
$
10,988

 
$
930

 
$
—

 
$
11,918

 
$
15,143

 
$
1,481

 
$
(7
)
 
$
16,617

Mortgage-Backed Securities – Commercial
24,684

 
—

 
(217
)
 
24,467

 
—

 
—

 
—

 
—

Obligations of U.S. Government-Sponsored Enterprises:
 
 
 
 
 
 

 
 
 
 
 
 
 

Mortgage-Backed Securities – Residential
662,858

 
4,497

 
(6,584
)
 
660,771

 
683,601

 
4,557

 
(11,305
)
 
676,853

Mortgage-Backed Securities – Commercial
—

 
—

 
—

 
—

 
1

 
—

 
—

 
1

Other Government-Sponsored Enterprises
1,097

 
—

 
—

 
1,097

 
16,700

 
—

 
(69
)
 
16,631

Obligations of States and Political Subdivisions
27,081

 
433

 
—

 
27,514

 
27,075

 
195

 
(41
)
 
27,229

Corporate Securities
15,903

 
675

 
—

 
16,578

 
5,903

 
416

 
—

 
6,319

Pooled Trust Preferred Collateralized Debt Obligations
40,594

 
516

 
(6,481
)
 
34,629

 
39,989

 
427

 
(7,124
)
 
33,292

Total Debt Securities
783,205

 
7,051

 
(13,282
)
 
776,974

 
788,412

 
7,076

 
(18,546
)
 
776,942

Equities
1,670

 
—

 
—

 
1,670

 
1,670

 
—

 
—

 
1,670

Total Securities Available for Sale
$
784,875

 
$
7,051

 
$
(13,282
)
 
$
778,644

 
$
790,082

 
$
7,076

 
$
(18,546
)
 
$
778,612



Mortgage-backed securities include mortgage-backed obligations of U.S. Government agencies and obligations of U.S. Government-sponsored enterprises. These obligations have contractual maturities ranging from less than one year to approximately 30 years with lower anticipated lives to maturity due to prepayments. All mortgage-backed securities contain a certain amount of risk related to the uncertainty of prepayments of the underlying mortgages. Interest rate changes have a direct impact upon prepayment speeds; therefore, First Commonwealth uses computer simulation models to test the average life and yield volatility of all mortgage-backed securities under various interest rate scenarios to monitor the potential impact on earnings and interest rate risk positions.

Expected maturities will differ from contractual maturities because issuers may have the right to call or repay obligations with or without call or prepayment penalties. Other fixed income securities within the portfolio also contain prepayment risk.
The amortized cost and estimated fair value of debt securities available for sale at September 30, 2017, by contractual maturity, are shown below.
 
Amortized
Cost
 
Estimated
Fair Value
 
(dollars in thousands)
Due within 1 year
$
997

 
$
997

Due after 1 but within 5 years
14,088

 
14,214

Due after 5 but within 10 years
27,081

 
27,515

Due after 10 years
42,509

 
37,092

 
84,675

 
79,818

Mortgage-Backed Securities (a)
698,530

 
697,156

Total Debt Securities
$
783,205

 
$
776,974

 
(a)
Mortgage-Backed Securities include an amortized cost of $35.7 million and a fair value of $36.4 million for Obligations of U.S. Government agencies issued by Ginnie Mae and an amortized cost of $662.9 million and a fair value of $660.8 million for Obligations of U.S. Government-sponsored enterprises issued by Fannie Mae and Freddie Mac.
 
Proceeds from sales, gross gains (losses) realized on sales, maturities and other-than-temporary impairment charges related to securities available for sale were as follows for the nine months ended September 30:
 
2017
 
2016
 
(dollars in thousands)
Proceeds from sales
$
143,660

 
$
55,744

Gross gains (losses) realized:
 
 
 
Sales Transactions:
 
 
 
Gross gains
$
359

 
$
304

Gross losses
(316
)
 
(276
)
 
43

 
28

Maturities and impairment
 
 
 
Gross gains
712

 
—

Gross losses
(60
)
 
—

 
652

 
—

Net gains and impairment
$
695

 
$
28



Proceeds from sales of investments for the nine months ended September 30, 2017 included the liquidation of the DCB investment portfolio in April 2017 and the sale of some CMO's and MBS's in the third quarter of 2017. All of the sales were to liquidate small positions held in the portfolio. Gross gains of $0.7 million recognized in 2017 were a result of the early redemption of one of our trust preferred securities. Securities available for sale with an estimated fair value of $554.0 million and $445.8 million were pledged as of September 30, 2017 and December 31, 2016, respectively, to secure public deposits and for other purposes required or permitted by law.
Securities Held to Maturity
Below is an analysis of the amortized cost and fair values of debt securities held to maturity at:
 
September 30, 2017
 
December 31, 2016
 
Amortized
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Estimated
Fair Value
 
Amortized
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Estimated
Fair Value
 
(dollars in thousands)
Obligations of U.S. Government Agencies:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Mortgage-Backed Securities – Residential
$
4,113

 
$
5

 
$
—

 
$
4,118

 
$
4,297

 
$
—

 
$
(4
)
 
$
4,293

Mortgage-Backed Securities- Commercial
58,528

 
—

 
(861
)
 
57,667

 
34,444

 
—

 
(561
)
 
33,883

Obligations of U.S. Government-Sponsored Enterprises:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Mortgage-Backed Securities – Residential
318,442

 
367

 
(975
)
 
317,834

 
280,430

 
5

 
(2,527
)
 
277,908

Mortgage-Backed Securities – Commercial
14,226

 
—

 
(4
)
 
14,222

 
14,675

 
—

 
(142
)
 
14,533

Obligations of States and Political Subdivisions
40,572

 
398

 
(129
)
 
40,841

 
38,667

 
55

 
(721
)
 
38,001

Debt Securities Issued by Foreign Governments
200

 
—

 
—

 
200

 
—

 
—

 
—

 
—

Total Securities Held to Maturity
$
436,081

 
$
770

 
$
(1,969
)
 
$
434,882

 
$
372,513

 
$
60

 
$
(3,955
)
 
$
368,618


The amortized cost and estimated fair value of debt securities held to maturity at September 30, 2017, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or repay obligations with or without call or prepayment penalties.
 
Amortized
Cost
 
Estimated
Fair Value
 
(dollars in thousands)
Due within 1 year
$
—

 
$
—

Due after 1 but within 5 years
3,104

 
3,131

Due after 5 but within 10 years
34,126

 
34,354

Due after 10 years
3,542

 
3,556

 
40,772

 
41,041

Mortgage-Backed Securities (a)
395,309

 
393,841

Total Debt Securities
$
436,081

 
$
434,882

(a)
Mortgage-Backed Securities include an amortized cost of $62.6 million and a fair value of $61.8 million for Obligations of U.S. Government agencies issued by Ginnie Mae and an amortized cost of $332.7 million and a fair value of $332.1 million for Obligations of U.S. Government-sponsored enterprises issued by Fannie Mae and Freddie Mac.
Securities held to maturity with an amortized cost of $324.6 million and $119.2 million were pledged as of September 30, 2017 and December 31, 2016, respectively, to secure public deposits and for other purposes required or permitted by law.