Note 4 - Investment Securities

12 Months Ended

Dec. 31, 2014

Investments, Debt and Equity Securities [Abstract]

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

4. Investment Securities

Investment Securities. The following tables reflect the amortized cost, gross unrealized gains, gross unrealized losses, and fair values of investment securities as of December 31, 2014, and December 31, 2013:

	As of December 31, 2014
			Gross		Gross
	Amortized		Unrealized		Unrealized
	Cost		Gains		Losses		Fair Value
	(In thousands)
Securities Available-for-Sale
U.S. treasury securities	$	664,206	$	63	$	265		664,004
Mortgage-backed securities		549,296		1,393		6,386		544,303
Collateralized mortgage obligations		79		-		34		45
Corporate debt securities		94,943		776		1,247		94,472
Mutual funds		6,000				134		5,866
Preferred stock of government sponsored entities		6,276		681		3,733		3,224
Other equity securities		3,608		3,413				7,021
Total securities available-for-sale	$	1,324,408	$	6,326	$	11,799	$	1,318,935

	As of December 31, 2013
			Gross		Gross
	Amortized		Unrealized		Unrealized
	Cost		Gains		Losses		Fair Value
	(In thousands)
Securities Available-for-Sale
U.S. treasury securities	$	460,095	$	99	$	1	$	460,193
Mortgage-backed securities		1,010,294		7,049		64,529		952,814
Collateralized mortgage obligations		5,929		231		54		6,106
Asset-backed securities		123		-		-		123
Corporate debt securities		154,955		298		4,949		150,304
Mutual funds		6,000		-		275		5,725
Preferred stock of government sponsored entities		569		10,834		-		11,403
Total securities available-for-sale	$	1,637,965	$	18,511	$	69,808	$	1,586,668

The amortized cost and fair value of investment securities at December 31, 2014, by contractual maturities are shown below. Actual maturities may differ from contractual maturities because borrowers may have the right to call or repay obligations with or without call or repayment penalties.  

	Securities Available-for-Sale
	Amortized Cost		Fair Value
	(In thousands)
Due in one year or less	$	115,033	$	115,068
Due after one year through five years		569,853		570,371
Due after five years through ten years		85,654		85,097
Due after ten years (1)		553,868		548,399
Total	$	1,324,408	$	1,318,935

(1) Equity securities are reported in this category

During the first quarter of 2013, due to the ongoing discussions regarding corporate income tax rates which could have a negative impact on the after-tax yields and fair values of the Company’s portfolio of municipal securities, the Company determined it may sell such securities in response to market conditions. As a result, the Company reclassified its municipal securities from securities held-to-maturity to securities available-for-sale. Concurrent with this reclassification, the Company also reclassified all other securities held-to-maturity, which together with the municipal securities had an amortized cost on the date of transfer of $722.5 million, to securities available-for-sale. At the reclassification date, a net unrealized gain was recorded in other comprehensive income for these securities totaling $40.5 million.

Proceeds from sales of mortgage-backed securities were $698.5 million and from repayments, maturities and calls of mortgage-backed securities were $69.7 million during 2014 compared to proceeds from sales of $456.4 million and proceeds of $213.2 million from repayments, maturities, and calls during 2013. Proceeds from sales of other investment securities were $160.5 million during 2014 compared to $575.4 million during 2013. Proceeds from maturities and calls of other investment securities were $585.8 during 2014 compared to $231.1 million during 2013. In 2014, gains of $18.0 million and losses of $11.3 million were realized on sales and calls of investment securities compared with gains of $29.0 million and losses of $1.6 million realized in 2013.

At December 31, 2014, all of the Company’s mortgage-backed securities were rated as investment grade except for one non-agency issue. Total unrealized losses of $6.4 million from all mortgage-backed securities resulted from increases in interest rates subsequent to the date that these securities were purchased. Total unrealized losses of $1.2 million on corporate bonds relates to four issues of investments in bonds of financial institutions, all of which were investment grade at the date of acquisition and as of December 31, 2014. The unrealized losses were primarily caused by the widening of credit and liquidity spreads since the dates of acquisition. The contractual terms of those investments do not permit the issuers to settle the security at a price less than the amortized cost of the investment. The Company currently does not believe it is probable that it will be unable to collect all amounts due according to the contractual terms of the investments. Therefore, it is expected that these mortgage-backed securities and corporate bonds would not be settled at a price less than the amortized cost of the investment. Because the Company does not intend to sell and would not be required to sell these investments until a recovery of fair value, which may be maturity, it does not consider its investments in these mortgaged-backed securities and corporate bonds to be other-than-temporarily impaired at December 31, 2014. During the third quarter of 2014, the Company wrote down the carrying value of its portfolio of agency preferred stock by $820,000. As of December 31, 2014, agency preferred stock of with a cost of $6.2 million had an unrealized loss of $3.7 million, which the Company believes to be temporary.

The temporarily impaired securities represent 66.1% of the fair value of investment securities as of December 31, 2014. Unrealized losses for securities with unrealized losses for less than twelve months represent 1.1%, and securities with unrealized losses for twelve months or more represent 1.6%, of the historical cost of these securities. Unrealized losses on these securities generally resulted from increases in interest rates or spreads subsequent to the date that these securities were purchased. At December 31, 2014, 22 issues of securities had unrealized losses for 12 months or longer and 8 issues of securities had unrealized losses of less than 12 months.

At December 31, 2014, management believed the impairment was temporary and, accordingly, no impairment loss on debt securities has been recognized in our condensed consolidated statements of operations. We expect to recover the amortized cost basis of our debt securities, and have no intent to sell and will not be required to sell available-for-sale debt securities that have declined below their cost before their anticipated recovery.

The tables below show the fair value and unrealized losses of the temporarily impaired securities in our investment securities portfolio as of December 31, 2014, and December 31, 2013:

	As of December 31, 2014
	Temporarily Impaired Securities
	Less than 12 months						12 months or longer						Total
	Fair		Unrealized		No. of		Fair		Unrealized		No. of		Fair		Unrealized		No. of
	Value		Losses		Issuances		Value		Losses		Issuances		Value		Losses		Issuances
	(Dollars in thousands)
Securities Available-for-Sale
U.S. treasury securities	$	374,153	$	265		6	$	-	$	-		-	$	374,153	$	265		6
Mortgage-backed securities		-		-		-		425,090		6,386		16		425,090		6,386		16
Collateralized mortgage obligations		-		-		-		45		34		1		45		34		1
Corporate debt securities		-		-		-		63,753		1,247		4		63,753		1,247		4
Mutual funds		-		-		-		5,866		134		1		5,866		134		1
Preferred stock of government sponsored entities		2,448		3,733		2		-		-		-		2,448		3,733		2
Total securities available-for-sale	$	376,601	$	3,998		8	$	494,754	$	7,801		22	$	871,355	$	11,799		30

	As of December 31, 2013
	Temporarily Impaired Securities
	Less than 12 months						12 months or longer						Total
	Fair		Unrealized		No. of		Fair		Unrealized		No. of		Fair		Unrealized		No. of
	Value		Losses		Issuances		Value		Losses		Issuances		Value		Losses		Issuances
	(Dollars in thousands)
Securities Available-for-Sale
U.S. treasury securities	$	75,064	$	1		1	$	-	$	-		-	$	75,064	$	1		1
Mortgage-backed securities		792,012		64,526		25		272		2		7		792,284		64,528		32
Mortgage-backed securities-Non-agency		94		1		1		-		-		-		94		1		1
Collateralized mortgage obligations		68		4		2		301		50		3		369		54		5
Corporate debt securities		9,970		30		1		100,081		4,919		8		110,051		4,949		9
Mutual funds		-		-		-		5,724		275		1		5,724		275		1
Total securities available-for-sale	$	877,208	$	64,562		30	$	106,378	$	5,246		19	$	983,586	$	69,808		49

     Investment securities having a carrying value of $591.3 million at December 31, 2014, and $926.5 million at December 31, 2013, were pledged to secure public deposits, other borrowings, treasury tax and loan, Federal Home Loan Bank advances, securities sold under agreements to repurchase, and foreign exchange transactions.