INVESTMENT SECURITIES

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



	June 30, 2018
(Dollars in thousands)	Amortized Cost		Gross Unrealized Gain		Gross Unrealized Loss		Fair Value
Available-for-Sale Debt Securities
CMO	$	307,500	$	61	$	9,298	$	298,263
FNMA MBS	556,567		9		18,336		538,240
FHLMC MBS	97,033		2		3,297		93,738
GNMA MBS	34,843		94		1,058		33,879
	$	995,943	$	166	$	31,989	$	964,120
Held-to-Maturity Debt Securities⁽¹⁾
State and political subdivisions	$	156,456	$	231	$	1,043	$	155,644

Equity Investments ⁽²⁾
Visa Class B shares	$	14,943	$	15,346	$	—	$	30,289
Other equity investments	3,300		—		—		3,300
	$	18,243	$	15,346	$	—	$	33,589


⁽¹⁾	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 $1.3 million at June 30, 2018, related to securities transferred, which are offset in Accumulated other comprehensive loss, net of tax.


⁽²⁾	Equity investments are included in Other investments in the unaudited Consolidated Statements of Financial Condition.



	December 31, 2017
(Dollars in thousands)	Amortized Cost		Gross Unrealized Gain		Gross Unrealized Loss		Fair Value
Available-for-Sale Debt Securities
CMO	$	250,592	$	88	$	4,141	$	246,539
FNMA MBS	479,218		941		6,172		473,987
FHLMC MBS	88,681		118		924		87,875
GNMA MBS	29,300		209		411		29,098
	$	847,791	$	1,356	$	11,648	$	837,499
Held-to-Maturity Debt Securities⁽¹⁾
State and political subdivisions	$	161,186	$	1,758	$	91	$	162,853

Equity Investments⁽²⁾
Other equity investments	$	643	$	—	$	20	$	623
	$	643	$	—	$	20	$	623


⁽¹⁾	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 $1.6 million at December 31, 2017, related to securities transferred, which are offset in Accumulated other comprehensive loss, net of tax.


⁽²⁾	Equity investments are included in Other investments in the unaudited Consolidated Statements of Financial Condition.

The scheduled maturities of our available-for-sale debt securities at June 30, 2018 and December 31, 2017 are presented in the table below:



	Available for Sale
	Amortized		Fair
(Dollars in thousands)	Cost		Value
June 30, 2018
Within one year	$	—	$	—
After one year but within five years	19,868		19,332
After five years but within ten years	174,662		165,177
After ten years	801,413		779,611
	$	995,943	$	964,120
December 31, 2017
Within one year	$	—	$	—
After one year but within five years	20,051		19,825
After five years but within ten years	179,812		175,583
After ten years	647,928		642,091
	$	847,791	$	837,499

The scheduled maturities of our held-to-maturity debt securities at June 30, 2018 and December 31, 2017 are presented in the table below:



	Held to Maturity
	Amortized		Fair
(Dollars in thousands)	Cost		Value
June 30, 2018
Within one year	$	155	$	155
After one year but within five years	6,837		6,824
After five years but within ten years	25,322		25,213
After ten years	124,142		123,452
	$	156,456	$	155,644
December 31, 2017
Within one year	$	322	$	320
After one year but within five years	5,895		5,894
After five years but within ten years	18,751		18,873
After ten years	136,218		137,766
	$	161,186	$	162,853

Mortgage-backed securities (MBS) may have expected maturities that differ from their contractual maturities. These differences arise because issuers may have the right to call securities and borrowers may have the right to prepay obligations with or without prepayment penalty.

Investment securities with fair market values aggregating $745.4 million and $688.2 million were pledged as collateral for retail customer repurchase agreements, municipal deposits, and other obligations as of June 30, 2018 and December 31, 2017, respectively.

During the six months ended June 30, 2018, we sold $7.0 million of debt securities categorized as available for sale, resulting in realized gains of less than $0.1 million and no realized losses. During the six months ended June 30, 2017, we sold $351.6 million of debt securities categorized as available for sale, resulting in realized gains of $1.1 million and realized losses of less than $0.1 million. The cost basis of all debt securities sales is based on the specific identification method.

As of June 30, 2018 and December 31, 2017, our debt securities portfolio had remaining unamortized premiums of $13.6 million and $14.1 million, respectively, and unaccreted discounts of $1.3 million as of both June 30, 2018 and December 31, 2017.

For debt securities with unrealized losses, the table below shows our gross unrealized losses and fair value by investment category and length of time that individual debt securities were in a continuous unrealized loss position at June 30, 2018.



	Duration of Unrealized Loss Position
	Less than 12 months				12 months or longer				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(Dollars in thousands)	Value		Loss		Value		Loss		Value		Loss
Available-for-sale debt securities:
CMO	$	199,985	$	5,031	$	83,359	$	4,267	$	283,344	$	9,298
FNMA MBS	397,186		10,438		114,832		7,898		512,018		18,336
FHLMC MBS	74,017		2,030		19,649		1,267		93,666		3,297
GNMA MBS	13,125		349		13,737		709		26,862		1,058
Total temporarily impaired investments	$	684,313	$	17,848	$	231,577	$	14,141	$	915,890	$	31,989

Held-to-maturity debt securities:
State and political subdivisions	$	103,069	$	897	$	5,723	$	146	$	108,792	$	1,043
Total temporarily impaired investments	$	103,069	$	897	$	5,723	$	146	$	108,792	$	1,043

For 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 December 31, 2017.



	Duration of Unrealized Loss Position
	Less than 12 months				12 months or longer				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(Dollars in thousands)	Value		Loss		Value		Loss		Value		Loss
Available-for-sale debt securities:
CMO	$	146,726	$	1,820	$	77,149	$	2,321	$	223,875	$	4,141
FNMA MBS	204,921		1,479		126,342		4,693		331,263		6,172
FHLMC MBS	42,514		269		21,405		655		63,919		924
GNMA MBS	4,615		56		14,782		355		19,397		411
Total temporarily impaired investments	$	398,776	$	3,624	$	239,678	$	8,024	$	638,454	$	11,648

Held-to-maturity debt securities:
State and political subdivisions	$	23,404	$	59	$	5,625	$	32	$	29,029	$	91
Total temporarily impaired investments	$	23,404	$	59	$	5,625	$	32	$	29,029	$	91

Other equity investments	$	—	$	—	$	624	$	20	$	624	$	20

At June 30, 2018, we owned debt securities totaling $1.02 billion for which the amortized cost basis exceeded fair value. Total unrealized losses on these securities were $33.0 million at June 30, 2018. The temporary impairment is the result of changes in market interest rates subsequent to purchase. 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 debt 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. 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 debt securities, with the exception of one having a fair value of $0.8 million at June 30, 2018, were AA-rated or better at the time of purchase and remained investment grade at June 30, 2018. All securities were evaluated for OTTI at June 30, 2018 and December 31, 2017. The result of this evaluation showed no OTTI as of June 30, 2018 or December 31, 2017. The estimated weighted average duration of MBS was 5.4 years at June 30, 2018.