INVESTMENT SECURITIES

The following tables set forth information about Farmer Mac's investment securities as of March 31, 2016 and December 31, 2015:

Table 2.1



	As of March 31, 2016
	Amount Outstanding		Unamortized Premium/(Discount)			Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
	(in thousands)
Available-for-sale:
Floating rate auction-rate certificates backed by Government guaranteed student loans	$	19,700	$	—		$	19,700	$	—	$	(1,970	)	$	17,730
Floating rate asset-backed securities	69,715		(249		)	69,466		5		(957		)	68,514
Floating rate corporate debt securities	10,000		—			10,000		2		—			10,002
Floating rate Government/GSE guaranteed mortgage-backed securities	1,317,245		3,322			1,320,567		2,692		(5,820		)	1,317,439
Fixed rate GSE guaranteed mortgage-backed securities⁽¹⁾	656		2,923			3,579		4,260		—			7,839
Floating rate GSE subordinated debt	70,000		—			70,000		—		(4,535		)	65,465
Fixed rate U.S. Treasuries	965,180		(618		)	964,562		1,033		(2		)	965,593
Total available-for-sale	2,452,496		5,378			2,457,874		7,992		(13,284		)	2,452,582
Trading:
Floating rate asset-backed securities	2,006		—			2,006		—		(1,623		)	383
Total investment securities	$	2,454,502	$	5,378		$	2,459,880	$	7,992	$	(14,907	)	$	2,452,965


⁽¹⁾	Fair value includes $7.1 million of an interest-only security with a notional amount of $147.9 million.



	As of December 31, 2015
	Amount Outstanding		Unamortized Premium/(Discount)			Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
	(in thousands)
Available-for-sale:
Floating rate auction-rate certificates backed by Government guaranteed student loans	$	46,500	$	—		$	46,500	$	—	$	(1,576	)	$	44,924
Floating rate asset-backed securities	74,744		(253		)	74,491		14		(776		)	73,729
Floating rate corporate debt securities	10,000		—			10,000		—		(9		)	9,991
Fixed rate corporate debt securities	10,000		(1		)	9,999		—		(5		)	9,994
Floating rate Government/GSE guaranteed mortgage-backed securities	1,353,495		3,515			1,357,010		2,768		(4,319		)	1,355,459
Fixed rate GSE guaranteed mortgage-backed securities⁽¹⁾	692		3,117			3,809		4,095		—			7,904
Floating rate GSE subordinated debt	70,000		—			70,000		—		(3,751		)	66,249
Fixed rate senior agency debt	214,000		(25		)	213,975		12		—			213,987
Fixed rate U.S. Treasuries	993,680		(417		)	993,263		2		(477		)	992,788
Total available-for-sale	2,773,111		5,936			2,779,047		6,891		(10,913		)	2,775,025
Trading:
Floating rate asset-backed securities	2,211		—			2,211		—		(1,720		)	491
Total investment securities	$	2,775,322	$	5,936		$	2,781,258	$	6,891	$	(12,633	)	$	2,775,516


⁽¹⁾	Fair value includes $7.2 million of an interest-only security with a notional amount of $148.5 million.

During the three months ended March 31, 2016, Farmer Mac received proceeds of $186.8 million from the sale of securities from its available-for-sale investment portfolio, resulting in gross realized gains of $0.2 million and gross realized losses of $0.2 million, compared to proceeds of $75.0 million for the same period in 2015, resulting in gross realized gains of $6,000.

As of March 31, 2016 and December 31, 2015, unrealized losses on available-for-sale investment securities were as follows:

Table 2.2



	As of March 31, 2016
	Available-for-Sale Securities
	Unrealized loss position for less than 12 months					Unrealized loss position for more than 12 months
	Fair Value		Unrealized Loss			Fair Value		Unrealized Loss
	(in thousands)
Floating rate auction-rate certificates backed by Government guaranteed student loans	$	—	$	—		$	17,730	$	(1,970	)
Floating rate asset-backed securities	47,887		(526		)	9,432		(431		)
Floating rate Government/GSE guaranteed mortgage-backed securities	699,078		(4,083		)	136,650		(1,737		)
Floating rate GSE subordinated debt	—		—			65,465		(4,535		)
Fixed rate U.S. Treasuries	15,002		(2		)	—		—
Total	$	761,967	$	(4,611	)	$	229,277	$	(8,673	)



	As of December 31, 2015
	Available-for-Sale Securities
	Unrealized loss position for less than 12 months					Unrealized loss position for more than 12 months
	Fair Value		Unrealized Loss			Fair Value		Unrealized Loss
	(in thousands)
Floating rate auction-rate certificates backed by Government guaranteed student loans	$	—	$	—		$	18,124	$	(1,576	)
Floating rate asset-backed securities	44,552		(464		)	9,975		(312		)
Floating rate corporate debt securities	4,991		(9		)	—		—
Fixed rate corporate debt securities	9,994		(5		)	—		—
Floating rate Government/GSE guaranteed mortgage-backed securities	794,959		(3,408		)	100,192		(911		)
Floating rate GSE subordinated debt	—		—			66,249		(3,751		)
Fixed rate U.S. Treasuries	944,842		(477		)	—		—
Total	$	1,799,338	$	(4,363	)	$	194,540	$	(6,550	)

The unrealized losses presented above are principally due to a general widening of credit spreads from the dates of acquisition to March 31, 2016 and December 31, 2015, as applicable. The resulting decrease in fair values reflects an increase in the perceived risk by the financial markets related to those securities. As of March 31, 2016, all of the investment securities in an unrealized loss position either were backed by the full faith and credit of the U.S. government or had credit ratings of at least "AA+," except one that was rated "A-." As of December 31, 2015, all of the investment securities in an unrealized loss position either were backed by the full faith and credit of the U.S. government or had credit ratings of at least "AA+," except three that were rated "A-." The unrealized losses were on 61 and 69 individual investment securities as of March 31, 2016 and December 31, 2015, respectively.

As of March 31, 2016, 17 of the securities in loss positions had been in loss positions for more than 12 months and had a total unrealized loss of $8.7 million. As of December 31, 2015, 17 of the securities in loss positions had been in loss positions for more than 12 months and had a total unrealized loss of $6.6 million. Securities in unrealized loss positions for 12 months or longer have a fair value as of March 31, 2016 that is, on average, approximately 96 percent of their amortized cost basis. Farmer Mac believes that all of these unrealized losses are recoverable within a reasonable period of time by way of maturity or changes in credit spreads. Accordingly, Farmer Mac has concluded that none of the unrealized losses on these available-for-sale investment securities represents other-than-temporary impairment as of March 31, 2016 and December 31, 2015.

Farmer Mac did not own any held-to-maturity investment securities as of March 31, 2016 and December 31, 2015. As of March 31, 2016, Farmer Mac owned trading investment securities with an amortized cost of $2.0 million, a fair value of $0.4 million, and a weighted average yield of 4.52 percent. As of December 31, 2015, Farmer Mac owned trading investment securities with an amortized cost of $2.2 million, a fair value of $0.5 million, and a weighted average yield of 4.41 percent.

The amortized cost, fair value, and weighted average yield of available-for-sale investment securities by remaining contractual maturity as of March 31, 2016 are set forth below. Asset-backed and mortgage-backed securities are included based on their final maturities, although the actual maturities may differ due to prepayments of the underlying assets.

Table 2.3



	As of March 31, 2016
	Available-for-Sale Securities
	Amortized Cost		Fair Value		Weighted- Average Yield
	(dollars in thousands)
Due within one year	$	940,691	$	941,643	0.55%
Due after one year through five years	188,476		188,801		1.11%
Due after five years through ten years	545,148		542,273		1.01%
Due after ten years	783,559		779,865		1.12%
Total	$	2,457,874	$	2,452,582	0.88%