7.	Investment Securities

The major components of our investment securities portfolio at December 31, 2011 and 2010 are as follows:


	December 31, 2011									December 31, 2010
(Dollars in thousands)	Amortized Cost		Unrealized Gains		Unrealized Losses			Carrying Value		Amortized Cost		Unrealized Gains		Unrealized Losses			Carrying Value
Available-for-sale securities, at fair value:
U.S. treasury securities	$	25,233	$	731	$	—		$	25,964	$	25,408	$	1,002	$	—		$	26,410
U.S. agency debentures		2,822,158		52,864		(90	)		2,874,932		2,844,973		7,077		(16,957	)		2,835,093
Residential mortgage-backed securities:
Agency-issued mortgage-backed securities		1,529,466		34,926		(106	)		1,564,286		1,234,120		15,487		(1,097	)		1,248,510
Agency-issued collateralized mortgage obligations-fixed rate		3,317,285		56,546		(71	)		3,373,760		806,032		24,435		(1	)		830,466
Agency-issued collateralized mortgage obligations-variable rate		2,416,158		1,554		(4,334	)		2,413,378		2,870,570		10,394		(1,439	)		2,879,525
Agency-issued commercial mortgage-backed securities		176,646		2,047		—			178,693		—		—		—			—
Municipal bonds and notes		92,241		8,257		—			100,498		96,381		2,164		(965	)		97,580
Equity securities		5,554		180		(1,199	)		4,535		358		34		(9	)		383

Total available-for-sale securities	$	10,384,741	$	157,105	$	(5,800	)	$	10,536,046	$	7,877,842	$	60,593	$	(20,468	)	$	7,917,967

Non-marketable securities:
Non-marketable securities (fair value accounting):
Venture capital and private equity fund investments (1)									611,824									391,247
Other venture capital investments (2)									124,121									111,843
Other investments (3)									987									981
Non-marketable securities (equity method accounting):
Other investments (4)									68,252									67,031
Low income housing tax credit funds									34,894									27,832
Non-marketable securities (cost method accounting):
Venture capital and private equity fund investments (5)									145,007									110,466
Other investments									19,355									12,120

Total non-marketable securities									1,004,440									721,520

Total investment securities								$	11,540,486								$	8,639,487

(1)	The following table shows the amount of venture capital and private equity fund investments by the following consolidated funds and our ownership of each fund at December 31, 2011 and 2010:


	December 31, 2011					December 31, 2010
(Dollars in thousands)	Amount		Ownership %			Amount		Ownership %
SVB Strategic Investors Fund, LP	$	39,567		12.6	%	$	44,722		12.6	%
SVB Strategic Investors Fund II, LP		122,619		8.6			94,694		8.6
SVB Strategic Investors Fund III, LP		218,429		5.9			146,613		5.9
SVB Strategic Investors Fund IV, LP		122,076		5.0			40,639		5.0
Strategic Investors Fund V, LP		8,838		0.3			—		—
SVB Capital Preferred Return Fund, LP		42,580		20.0			23,071		20.0
SVB Capital—NT Growth Partners, LP		43,958		33.0			28,624		33.0
SVB Capital Partners II, LP (i)		2,390		5.1			4,506		5.1
Other private equity fund (ii)		11,367		58.2			8,378		60.6

Total venture capital and private equity fund investments	$	611,824				$	391,247

(i)

At December 31, 2011, we had a direct ownership interest of 1.3 percent and an indirect ownership interest of 3.8 percent in the fund through our ownership of SVB Strategic Investors Fund II, LP.

(ii)

At December 31, 2011, we had a direct ownership interest of 41.5 percent and an indirect ownership interest of 12.6 percent and 4.1 percent in the fund through our ownership interests of SVB Capital—NT Growth Partners, LP and SVB Capital Preferred Return Fund, LP, respectively.

(2)	The following table shows the amount of other venture capital investments by the following consolidated funds and our ownership of each fund at December 31, 2011 and 2010:


	December 31, 2011					December 31, 2010
(Dollars in thousands)	Amount		Ownership %			Amount		Ownership %
Silicon Valley BancVentures, LP	$	17,878		10.7	%	$	21,371		10.7	%
SVB Capital Partners II, LP (i)		61,099		5.1			51,545		5.1
SVB India Capital Partners I, LP		42,832		14.4			38,927		14.4
SVB Capital Shanghai Yangpu Venture Capital Fund		2,312		6.8			—		—

Total other venture capital investments	$	124,121				$	111,843

(i)

At December 31, 2011, we had a direct ownership interest of 1.3 percent and an indirect ownership interest of 3.8 percent in the fund through our ownership of SVB Strategic Investors Fund II, LP.

(3)

Other investments within non-marketable securities (fair value accounting) include our ownership in Partners for Growth, LP, a consolidated debt fund. At December 31, 2011 we had a majority ownership interest of slightly more than 50.0 % in the fund. Partners for Growth, LP is managed by a third party and we do not have an ownership interest in the general partner of this fund.

(4)	The following table shows the carrying value and our ownership percentage of each investment at December 31, 2011 and 2010:


	December 31, 2011					December 31, 2010
(Dollars in thousands)	Amount		Ownership %			Amount		Ownership %
Gold Hill Venture Lending 03, LP (i)	$	16,072		9.3	%	$	17,826		9.3	%
Gold Hill Capital 2008, LP (ii)		19,328		15.5			12,101		15.5
Partners for Growth II, LP		3,785		24.2			10,465		24.2
Other investments		29,067		N/A			26,639		N/A

Total other investments	$	68,252				$	67,031

(i)

At December 31, 2011, we had a direct ownership interest of 4.8 percent in the fund and an indirect interest in the fund through our investment in GHLLC of 4.5 percent. Our aggregate direct and indirect ownership in the fund is 9.3 percent.

(ii)

At December 31, 2011, we had a direct ownership interest of 11.5 percent in the fund and an indirect interest in the fund through our investment in Gold Hill Capital 2008, LLC of 4.0 percent. Our aggregate direct and indirect ownership in the fund is 15.5 percent.

(5)

Represents investments in 329 and 343 funds (primarily venture capital funds) at December 31, 2011 and 2010, respectively, where our ownership interest is less than 5% of the voting interests of each such fund and in which we do not have the ability to exercise significant influence over the partnerships operating and financial policies. For the year ended December 31, 2011, we recognized other-than-temporary impairment (“OTTI”) losses of $1.0 million resulting from other-than-temporary declines in value for 41 of the 329 investments. The OTTI losses are included in net gains (losses) on investment securities, a component of noninterest income. For the remaining 288 investments at December 31, 2011, we concluded that declines in value, if any, were temporary and as such, no OTTI was required to be recognized. At December 31, 2011, the carrying value of these venture capital and private equity fund investments (cost method accounting) was $145.0 million, and the estimated fair value was $163.7 million.

The following table summarizes our unrealized losses on our available-for-sale securities portfolio into categories of less than 12 months, or 12 months or longer as of December 31, 2011:


(Dollars in thousands)	December 31, 2011
	Less than 12 months					12 months or longer				Total
	Fair Value of Investments		Unrealized Losses			Fair Value of Investments		Unrealized Losses		Fair Value of Investments		Unrealized Losses
U.S. agency debentures	$	50,994	$	(90	)	$	—	$	—	$	50,994	$	(90	)
Residential mortgage-backed securities:
Agency-issued mortgage-backed securities		54,588		(106	)		—		—		54,588		(106	)
Agency-issued collateralized mortgage obligations—fixed rate		50,125		(71	)		—		—		50,125		(71	)
Agency-issued collateralized mortgage obligations—variable rate		1,521,589		(4,334	)		—		—		1,521,589		(4,334	)
Equity securities		3,831		(1,199	)		—		—		3,831		(1,199	)

Total temporarily impaired securities (1)	$	1,681,127	$	(5,800	)	$	—	$	—	$	1,681,127	$	(5,800	)

(1)

As of December 31, 2011, we identified a total of 106 investments that were in unrealized loss positions, none of which have been in an impaired position for a period of time greater than 12 months. Based on the underlying credit quality of the investments, we do not intend to sell any of our securities prior to recovery of our adjusted cost basis and as of December 31, 2011, it is more likely than not that we will not be required to sell any of our debt securities prior to recovery of our adjusted cost basis. Based on our analysis as of December 31, 2011, we deem all impairments to be temporary and changes in value for our temporarily impaired securities as of the same date are included in other comprehensive income. Market valuations and impairment analyses on assets in the available-for-sale securities portfolio are reviewed and monitored on a quarterly basis.

The following table summarizes our unrealized losses on our available-for-sale securities portfolio into categories of less than 12 months or 12 months or longer as of December 31, 2010:


(Dollars in thousands)	December 31, 2010
	Less than 12 months					12 months or longer					Total
	Fair Value of Investments		Unrealized Losses			Fair Value of Investments		Unrealized Losses			Fair Value of Investments		Unrealized Losses
U.S. agency debentures	$	1,731,639	$	(16,957	)	$	—	$	—		$	1,731,639	$	(16,957	)
Residential mortgage-backed securities:
Agency-issued mortgage-backed securities		32,595		(1,097	)		—		—			32,595		(1,097	)
Agency-issued collateralized mortgage obligations—fixed rate		322		(1	)		—		—			322		(1	)
Agency-issued collateralized mortgage obligations—variable rate		506,104		(1,439	)		—		—			506,104		(1,439	)
Municipal bonds and notes		25,699		(893	)		3,451		(72	)		29,150		(965	)
Equity securities		148		(9	)		—		—			148		(9	)

Total temporarily impaired securities	$	2,296,507	$	(20,396	)	$	3,451	$	(72	)	$	2,299,958	$	(20,468	)

The following table summarizes the remaining contractual principal maturities and fully taxable equivalent yields on debt securities classified as available-for-sale as of December 31, 2011. Interest income on certain municipal bonds and notes (non-taxable investments) are presented on a fully taxable equivalent basis using the federal statutory tax rate of 35.0 percent. The weighted average yield is computed using the amortized cost of debt securities, which are reported at fair value. For U.S. treasury securities, the expected maturity is the actual contractual maturity of the notes. Expected remaining maturities for most U.S. agency debentures may occur earlier than their contractual maturities because the note issuers have the right to call outstanding amounts ahead of their contractual maturity. Expected maturities for mortgage-backed securities may differ significantly from their contractual maturities because mortgage borrowers have the right to prepay outstanding loan obligations with or without penalties. Mortgage-backed securities classified as available-for-sale typically have original contractual maturities from 10 to 30 years whereas expected average lives of these securities tend to be significantly shorter and vary based upon structure.


	December 31, 2011
	Total					One Year or Less					After One Year to Five Years					After Five Years to Ten Years					After Ten Years
(Dollars in thousands)	Carrying Value		Weighted- Average Yield			Carrying Value		Weighted- Average Yield			Carrying Value		Weighted- Average Yield			Carrying Value		Weighted- Average Yield			Carrying Value		Weighted- Average Yield
U.S. treasury securities	$	25,964		2.39	%	$	—		—	%	$	25,964		2.39	%	$	—		—	%	$	—		—	%
U.S. agency debentures		2,874,932		1.60			38,183		2.19			2,659,334		1.55			177,415		2.16			—		—
Residential mortgage-backed securities:
Agency-issued mortgage-backed securities		1,564,286		2.59			—		—			—		—			1,434,122		2.50			130,164		3.53
Agency-issued collateralized mortgage obligations—fixed rate		3,373,760		2.41			—		—			—		—			—		—			3,373,760		2.41
Agency-issued collateralized mortgage obligations—variable rate		2,413,378		0.70			—		—			—		—			—		—			2,413,378		0.70
Agency-issued commercial mortgage-backed securities		178,693		2.11			—		—			—		—			—		—			178,693		2.11
Municipal bonds and notes		100,498		6.00			559		5.38			12,089		5.48			50,242		5.97			37,608		6.22

Total	$	10,531,511		1.85		$	38,742		2.24		$	2,697,387		1.58		$	1,661,779		2.57		$	6,133,603		1.78

Available-for-sale securities with a fair value of $1.6 billion and $1.1 billion at December 31, 2011 and 2010, respectively, were pledged to secure certain deposits, current and prospective FHLB borrowings, and to maintain the ability to borrow at the discount window at the Federal Reserve. For further information on our available lines of credit, refer to Note 11—“Short-Term Borrowings and Long-Term Debt.”

The following table presents the components of gains and losses (realized and unrealized) on investment securities in 2011, 2010 and 2009:


	Year ended December 31,
(Dollars in thousands)	2011			2010			2009
Gross gains on investment securities:
Available-for-sale securities, at fair value (1)	$	37,387		$	27,110		$	246
Marketable securities (fair value accounting)		912			8,160			1,413
Non-marketable securities (fair value accounting):
Venture capital and private equity fund investments		145,892			63,137			17,425
Other venture capital investments		36,506			29,455			15,970
Other investments		40			140			762
Non-marketable securities (equity method accounting):
Other investments		12,445			8,551			6,528
Non-marketable securities (cost method accounting):
Venture capital and private equity fund investments		2,517			1,739			449
Other investments		6,527			478			23

Total gross gains on investment securities		242,226			138,770			42,816

Gross losses on investment securities:
Available-for-sale securities, at fair value (1)		(261	)		(2,287	)		(414	)
Marketable securities (fair value accounting)		(8,103	)		(9,855	)		(431	)
Non-marketable securities (fair value accounting):
Venture capital and private equity fund investments		(26,591	)		(19,497	)		(46,318	)
Other venture capital investments		(8,918	)		(11,079	)		(18,678	)
Other investments		(16	)		(158	)		—
Non-marketable securities (equity method accounting):
Other investments		(2,241	)		(616	)		(3,337	)
Non-marketable securities (cost method accounting):
Venture capital and private equity fund investments		(1,028	)		(1,793	)		(4,439	)
Other investments		(34	)		(125	)		(408	)

Total gross losses on investment securities		(47,192	)		(45,410	)		(74,025	)

Gains (losses) on investment securities, net	$	195,034		$	93,360		$	(31,209	)

Gains (losses) attributable to noncontrolling interests, including carried interest	$	125,042		$	52,586		$	(26,638	)

(1)	The cost basis of available-for-sale securities sold is determined on a specific identification basis.