4. INVESTMENT SECURITIES

The following tables detail the amortized cost and the estimated fair value of our available-for-sale and held-to-maturity investment securities. None of our investment securities are classified as trading.


	Amortized Cost		Gross Unrealized Gain		Gross Unrealized Loss		Fair Value
(In Thousands)

Available-for-Sale Securities:
June 30, 2016
GSE	$	39,080	$	147	$	—	$	39,227
CMO		259,834		6,520		32		266,322
FNMA MBS		336,103		11,144		23		347,224
FHLMC MBS		84,550		2,343		—		86,893
GNMA MBS		26,181		641		29		26,793

	$	745,748	$	20,795	$	84	$	766,459

December 31, 2015
GSE	$	31,041	$	—	$	127	$	30,914
CMO		253,189		713		2,414		251,488
FNMA MBS		320,105		1,081		2,715		318,471
FHLMC MBS		99,350		405		313		99,442
GNMA MBS		20,387		420		93		20,714

	$	724,072	$	2,619	$	5,662	$	721,029


(In Thousands)	Amortized Cost		Gross Unrealized Gain		Gross Unrealized Loss		Fair Value
Held-to-Maturity Securities ^(a)
June 30, 2016
State and political subdivisions	$	166,398	$	6,654	$	20	$	173,032

December 31, 2015
State and political subdivisions	$	165,862	$	1,943	$	62	$	167,743

(a)

Held-to-maturity securities transferred from available-for-sale are included in held-to-maturity at fair value at the time of transfer. The amortized cost of held-to-maturity securities included net unrealized gains of $2.6 million and $2.9 million at June 30, 2016 and December 31, 2015, respectively, related to securities transferred, which are offset in Accumulated Other Comprehensive Income, net of tax.

The scheduled maturities of investment securities available-for-sale and held-to-maturity at June 30, 2016 and December 31, 2015 are presented in the table below:


	Available-for-Sale
(In Thousands)	Amortized Cost		Fair Value
June 30, 2016
Within one year	$	10,994	$	11,009
After one year but within five years		28,086		28,218
After five years but within ten years		239,335		248,220
After ten years		467,333		479,012

	$	745,748	$	766,459

December 31, 2015
Within one year	$	3,997	$	3,995
After one year but within five years		30,009		29,840
After five years but within ten years		218,023		215,018
After ten years		472,043		472,176

	$	724,072	$	721,029


	Held-to-Maturity
(In Thousands)	Amortized Cost		Fair Value
June 30, 2016
After one year but within five years		3,179		3,212
After five years but within ten years		9,520		9,796
After ten years		153,699		160,024

	$	166,398	$	173,032

December 31, 2015
Within one year	$	1,486	$	1,488
After one year but within five years		3,465		3,456
After five years but within ten years		7,939		8,045
After ten years		152,972		154,754

	$	165,862	$	167,743

MBS have expected maturities that differ from their contractual maturities. These differences arise because borrowers have the right to call or prepay obligations with or without a prepayment penalty.

Investment securities with fair market values aggregating $447.2 million and $457.0 million were pledged as collateral for retail customer repurchase agreements, municipal deposits, and other obligations as of June 30, 2016 and December 31, 2015, respectively.

During the first six months of 2016 and 2015, we sold $101.3 million and $88.2 million of investment securities categorized as available-for-sale, for a gain of $850,000 and $928,000, respectively. No losses were incurred from sales during the first six months of 2016 and 2015.

As of June 30, 2016 and December 31, 2015, our investment securities portfolio had remaining unamortized premiums of $18.0 million and $18.3 million and unaccreted discounts of $304,000 and $306,000, respectively.

For these investment securities with unrealized losses, the table below shows our gross unrealized losses and fair value by investment category and length of time that individual securities were in a continuous unrealized loss position at June 30, 2016.


	Duration of Unrealized Loss Position
	Less than 12 months				12 months or longer				Total
(In Thousands)	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Available-for-sale securities:
CMO		4,992		15		5,383		17		10,375		32
FNMA MBS		4,119		23		—		—		4,119		23
GNMA MBS		8,539		29		—		—		8,539		29

Total temporarily impaired investments	$	17,650	$	67	$	5,383	$	17	$	23,033	$	84


	Less than 12 months				12 months or longer				Total
(In Thousands)	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Held-to-maturity securities:
State and political subdivisions	$	—	$	—	$	2,449	$	20	$	2,449	$	20

Total temporarily impaired investments	$	—	$	—	$	2,449	$	20	$	2,449	$	20


	Duration of Unrealized Loss Position
	Less than 12 months				12 months or longer				Total
(In Thousands)	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Available-for-sale securities:
GSE	$	30,914	$	127	$	—	$	—	$	30,914	$	127
CMO		139,486		1,703		26,536		711		166,022		2,414
FNMA MBS		214,465		2,715		—		—		214,465		2,715
FHLMC MBS		41,791		136		4,025		177		45,816		313
GNMA MBS		4,073		29		2,377		64		6,450		93

Total temporarily impaired investments	$	430,729	$	4,710	$	32,938	$	952	$	463,667	$	5,662


	Less than 12 months				12 months or longer				Total
(In Thousands)	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Held-to-maturity securities:
State and political subdivisions	$	9,845	$	62	$	—	$	—	$	9,845	$	62

Total temporarily impaired investments	$	9,845	$	62	$	—	$	—	$	9,845	$	62

At June 30, 2016, we owned investment securities totaling $25.5 million in which the amortized cost basis exceeded fair value. Total unrealized losses on these securities were $104,000 at June 30, 2016. The temporary impairment is the result of changes in market interest rates subsequent to the purchase of the securities. Our investment portfolio is reviewed each quarter for indications of OTTI. This review includes analyzing the length of time and the extent to which the fair value has been lower than the amortized cost, the financial condition and near-term prospects of the issuer, including any specific events which may influence the operations of the issuer and our intent and ability to hold the investment for a period of time sufficient to allow for full recovery of the unrealized loss. We evaluate our intent and ability to hold securities based upon our investment strategy for the particular type of security and our cash flow needs, liquidity position, capital adequacy and interest rate risk position. In addition, we do not have the intent to sell, nor is it more likely-than-not we will be required to sell these securities before we are able to recover the amortized cost basis.

All securities, with the exception of one, were AA-rated or better at the time of purchase and remained investment grade at June 30, 2016. All securities were evaluated for OTTI at June 30, 2016 and December 31, 2015. The result of this evaluation showed no OTTI as of June 30, 2016 or December 31, 2015. The estimated weighted average duration of MBS was 3.6 years at June 30, 2016.