INVESTMENT SECURITIES

9 Months Ended

Sep. 30, 2013

Investments, Debt and Equity Securities [Abstract]

INVESTMENT SECURITIES

INVESTMENT SECURITIES

Components of investment securities are as follows (in thousands):

	September 30, 2013		December 31, 2012
			(Restated)
Available-for-sale securities	$	6,086	$	5,211
Trading securities	3,672		5,365
Total investment securities, at fair value	$	9,758	$	10,576

Available-for-sale securities.  The following table discloses the pre-tax unrealized gains (losses) relating to the Company’s investments in available-for-sale securities (in thousands):

	Cost or Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
September 30, 2013:
CLO securities	$	4,970	$	1,000	$	(313	)	$	5,657
Equity securities	208		227		(6		)	429
Total	$	5,178	$	1,227	$	(319	)	$	6,086
December 31, 2012:	(Restated)
CLO securities	$	3,712	$	1,290	$	—		$	5,002
Equity securities	109		100		—			209
Total	$	3,821	$	1,390	$	—		$	5,211

CLO securities.  The collateralized loan obligation ("CLO") securities represent the Company’s retained equity interests in eight and five CLO issuers that it directly and/or through its joint venture has structured and managed at September 30, 2013 and December 31, 2012, respectively.  The fair value of these retained interests is impacted by the fair value of the investments held by the respective CLO issuers, which are sensitive to interest rate fluctuations and credit quality determinations. The Company is required to maintain a minimum investment of $2.0 million (par value) in the subordinated notes of one of the CLO issuers, Apidos CLO II.

Equity securities.  The Company also holds 18,972 shares of The Bancorp, Inc. ("TBBK") (NASDAQ: TBBK) common stock.  These investments are pledged as collateral for the Company’s secured corporate credit facilities. During the three months ended March 31, 2013, the Company purchased 10,000 shares of Resource Real Estate Diversified Income Fund, a new publicly traded investment entity that it sponsored and manages ("RREDX") (NASDAQ: RREDX), for $100,000.

Trading securities.  The Company began purchasing investment securities classified as trading securities during fiscal 2013. For the three and nine months endedSeptember 30, 2013, the Company had net realized gains from sales of trading securities of $2.8 million and $4.6 million, respectively, as well as unrealized gains of $289,000 and $774,000, respectively, which were included in Financial Fund Management Revenues on the consolidated statements of operations. For the three and nine months endedSeptember 30, 2012, the Company had unrealized gains on trading securities of $933,000 and $1.1 million, respectively.

Unrealized losses, along with the related fair values and aggregated by the length of time the investments were in a continuous unrealized loss position, are as follows (in thousands, except number of securities):

	Less than 12 Months						More than 12 Months
	Fair Value		Unrealized Loss			Number of Securities	Fair Value		Unrealized Loss		Number of Securities
September 30, 2013:
CLO securities	$	2,289	$	(313	)	3	$	—	$	—	—
Equity securities	94		(6		)	1	—		—		—
Total	$	2,383	$	(319	)	4	$	—	$	—	—

 Other-than-temporary impairment losses. During the nine months endedSeptember 30, 2013 and 2012, the Company recorded charges of $214,000 and $74,000, respectively, for the other-than-temporary impairment of certain of its investments in CLOs, primarily those with investments in bank loans.