3. Securities Available-for-Sale


	December 31, 2014								December 31, 2013
	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)
U.S. Treasury	$	1,999	$	1	$	—	$	2,000	$	1,997	$	1	$	—	$	1,998
U.S. Government Sponsored Enterprises		—		—		—		—		9,995		9		—		10,004
SBA Backed Securities		6,684		33		—		6,717		7,270		32		—		7,302
U.S. Government Agency and Sponsored Enterprises Mortgage-Backed Securities		336,158		1,387		452		337,093		404,103		588		1,501		403,190
Privately Issued Residential Mortgage-Backed Securities		1,894		5		25		1,874		2,294		6		23		2,277
Obligations Issued by States and Political Subdivisions		97,657		—		873		96,784		37,578		15		870		36,723
Other Debt Securities		3,600		24		100		3,524		2,300		—		125		2,175
Equity Securities		218		180		—		398		406		170		—		576

Total	$	448,210	$	1,630	$	1,450	$	448,390	$	465,943	$	821	$	2,519	$	464,245

Included in U.S. Government Sponsored Enterprise Securities and U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities are securities at fair value pledged to secure public deposits and repurchase agreements amounting to $301,038,000 and $368,137,000 at December 31, 2014 and 2013, respectively. Also included in securities available-for-sale at fair value are securities pledged for borrowing at the Federal Home Loan Bank amounting to $24,810,000 and $12,214,000 at December 31, 2014 and 2013, respectively. The Company realized gains on sales of securities of $450,000, $3,019,000 and $1,843,000 from the proceeds of sales of available-for-sale securities of $40,285,000, $224,045,000 and $294,881,000 for the years ended December 31, 2014, 2013, and 2012, respectively.

Debt securities of Government Sponsored Enterprises primarily refer to debt securities of Fannie Mae and Freddie Mac.

The following table shows the estimated maturity distribution of the Company’s securities available-for-sale at December 31, 2014.


	Amortized Cost		Fair Value
(dollars in thousands)
Within one year	$	95,134	$	95,118
After one but within five years		207,506		208,518
After five but within ten years		135,803		135,733
More than ten years		8,049		7,224
Nonmaturing		1,718		1,797

Total	$	448,210	$	448,390

The weighted average remaining life of investment securities available-for-sale at December 31, 2014, was 4.1 years. The contractual maturities, which were used in the table above, of mortgage-backed securities, will differ from the actual maturities due to the ability of the issuers to prepay underlying obligations. Also, $346,994,000 of the securities are floating rate or adjustable rate and reprice prior to maturity.

The Company transferred $987,037,000 of securities with unrealized losses of $25,333,000 from available-for-sale to held-to-maturity during 2013.

As of December 31, 2014 and December 31, 2013, management concluded that the unrealized losses of its investment securities are temporary in nature since they are not related to the underlying credit quality of the issuers, and the Company does not intend to sell these debt securities and it is not more likely than not that it will be required to sell these debt securities before the anticipated recovery of its remaining amortized cost. In making its other-than-temporary impairment evaluation, the Company considered the fact that the principal and interest on these securities are from issuers that are investment grade. The change in the unrealized losses on the state and municipal securities and the nonagency mortgage-backed securities was primarily caused by changes in credit spreads and liquidity issues in the marketplace.

The unrealized loss on U.S. Government Sponsored Enterprises and U.S. Government Sponsored Enterprises Mortgage Backed Securities related primarily to interest rates and not credit quality and because the Company has the ability and intent to hold these investments until recovery of fair value, which may be maturity. The Company does not consider these investments to be other-than-temporarily impaired at December 31, 2014 and December 31, 2013.

In evaluating the underlying credit quality of a security, management considers several factors such as the credit rating of the obligor and the issuer, if applicable. Internal reviews of issuer financial statements are performed as deemed necessary. In the case of privately issued mortgage-backed securities, the performance of the underlying loans is analyzed as deemed necessary to determine the estimated future cash flows of the securities. Factors considered include the level of subordination, current and estimated future default rates, current and estimated prepayment rates, estimated loss severity rates, geographic concentrations and origination dates of underlying loans. In the case of marketable equity securities, the severity of the unrealized loss, the length of time the unrealized loss has existed, and the issuer’s financial performance are considered.

The following table shows the temporarily impaired securities of the Company’s available-for-sale portfolio at December 31, 2014. This table shows the unrealized market loss of securities that have been in a continuous unrealized loss position for 12 months or less and a continuous loss position for 12 months and longer. There are 3 and 14 securities that are temporarily impaired for less than 12 months and for 12 months or longer, respectively, out of a total of 262 holdings at December 31, 2014.


	December 31, 2014
	Less Than 12 Months				12 Months or Longer				Total
Temporarily Impaired Investments	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
(dollars in thousands)
U.S. Government Sponsored Enterprise	$	—	$	—	$	—	$	—	$	—	$	—
U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities		24,457		85		77,585		367		102,042		452
Privately Issued Residential Mortgage-Backed Securities		—		—		678		25		678		25
Obligations Issued by States and Political Subdivisions		—		—		3,820		873		3,820		873
Other Debt Securities		—		—		1,400		100		1,400		100

Total temporarily impaired securities	$	24,457	$	85	$	83,483	$	1,365	$	107,940	$	1,450

The following table shows the temporarily impaired securities of the Company’s available-for-sale portfolio at December 31, 2013. This table shows the unrealized market loss of securities that have been in a continuous unrealized loss position for 12 months or less and a continuous loss position for 12 months and longer. There are 47 and 7 securities that are temporarily impaired for less than 12 months and for 12 months or longer, respectively, out of a total of 234 holdings at December 31, 2013.


	December 31, 2013
	Less Than 12 Months				12 Months or Longer				Total
Temporarily Impaired Investments	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
(dollars in thousands)
U.S. Government Sponsored Enterprise	$	—	$	—	$	—	$	—	$	—	$	—
U.S. Government Agency and Sponsored Enterprise Mortgage-Backed Securities		289,709		1,352		24,557		149		314,266		1,501
Privately Issued Residential Mortgage-Backed Securities		1,486		23		—		—		1,486		23
Obligations Issued by States and Political Subdivisions		—		—		3,820		870		3,820		870
Other Debt Securities		—		—		1,376		125		1,376		125

Total temporarily impaired securities	$	291,195	$	1,375	$	29,753	$	1,144	$	320,948	$	2,519