Note 3 - Investment Securities

12 Months Ended

Dec. 31, 2020

Notes to Financial Statements

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

3. Investment Securities

Investment Securities. The following tables reflect the amortized cost, gross unrealized gains, gross unrealized losses, and fair values of debt securities available-for-sale as of December 31, 2020 and December 31, 2019:

	As of December 31, 2020
			Gross		Gross
	Amortized		Unrealized		Unrealized
	Cost		Gains		Losses		Fair Value
	(In thousands)
Securities Available-for-Sale
U.S. treasury securities	$	80,948	$	6	$	6	$	80,948
U.S. government agency entities		99,944		441		546		99,839
Mortgage-backed securities		709,709		17,965		606		727,068
Collateralized mortgage obligations		10,358		—		34		10,324
Corporate debt securities		118,271		367		267		118,371
Total securities available-for-sale	$	1,019,230	$	18,779	$	1,459	$	1,036,550

	As of December 31, 2019
			Gross		Gross
	Amortized		Unrealized		Unrealized
	Cost		Gains		Losses		Fair Value
	(In thousands)
Securities Available-for-Sale
U.S. treasury securities	$	74,926	$	10	$	—	$	74,936
U.S. government agency entities		90,452		663		319		90,796
U.S. government sponsored entities		225,000		—		557		224,443
Mortgage-backed securities		880,040		8,574		824		887,790
Collateralized mortgage obligations		569		—		17		552
Corporate debt securities		172,743		605		23		173,325
Total securities available-for-sale	$	1,443,730	$	9,852	$	1,740	$	1,451,842

The amortized cost and fair value of investment securities at December 31, 2020, 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
	As of December 31, 2020
	Amortized Cost		Fair Value
	(In thousands)
Due in one year or less	$	131,974	$	132,026
Due after one year through five years		54,820		54,688
Due after five years through ten years		190,440		194,029
Due after ten years		641,996		655,807
Total	$	1,019,230	$	1,036,550

Proceeds from the sale of investment securities were $117.2 million during 2020 compared to $293.8 million during 2019. Proceeds from repayments, maturities and calls of investment securities during 2020 were $734.5 million compared to $296.7 million during 2019. In 2020, the Company recorded realized gains of $1.7 million and zero losses on sales of investment securities compared to realized gains of $583 thousand and losses of $372 thousand in 2019.

The temporarily impaired securities represent 17.9% of the fair value of investment securities as of December 31, 2020. Unrealized losses for securities with unrealized losses for less than twelve months represent 0.3%, and securities with unrealized losses for twelve months or longer represent 2.1%, 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.

Total unrealized losses of $1.5 million at December 31, 2020, were primarily caused by increases in interest rates or 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.

At December 31, 2020, management believed the impairment was temporary and, accordingly, there was no impairment loss on debt securities has been recognized in our Consolidated Statements of Operations as of December 31, 2020. The Company expects to recover the amortized cost basis of its debt securities and has no intent to sell and believes it is more likely than not that it 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, 2020, and December 31, 2019:

	As of December 31, 2020
	Temporarily Impaired Securities
	Less than 12 months				12 months or longer				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Losses		Value		Losses		Value		Losses
	(In thousands)
Securities Available-for-Sale
U.S. treasury securities	$	40,952	$	6	$	—	$	—	$	40,952	$	6
U.S. government agency entities		26,390		102		40,009		444		66,399		546
Mortgage-backed securities		1,694		23		8,093		583		9,787		606
Collateralized mortgage obligations		10,131		25		193		9		10,324		34
Corporate debt securities		58,405		267		—		—		58,405		267
Total securities available-for-sale	$	137,572	$	423	$	48,295	$	1,036	$	185,867	$	1,459

	As of December 31, 2019
	Temporarily Impaired Securities
	Less than 12 months				12 months or longer				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Losses		Value		Losses		Value		Losses
	(In thousands)
Securities Available-for-Sale
U.S. government agency entities	$	48,829	$	172	$	3,570	$	147	$	52,399	$	319
U.S. government sponsored entities		—		—		224,443		557		224,443		557
Mortgage-backed securities		43,719		36		120,801		788		164,520		824
Collateralized mortgage obligations		—		—		552		17		552		17
Corporate debt securities		51,791		23		—		—		51,791		23
Total securities available-for-sale	$	144,339	$	231	$	349,366	$	1,509	$	493,705	$	1,740

Investment securities having a carrying value of $22.7 million at December 31, 2020, and $20.1 million at December 31, 2019, were pledged to secure public deposits, other borrowings, treasury tax and loan, securities sold under agreements to repurchase, and foreign exchange transactions.

The adoption of ASU 2016-01 resulted in approximately $8.6 million being reclassified from accumulated other comprehensive income to retained earnings, representing an increase to retained earnings as of January 1, 2018. For the year ended December 31, 2020, the Company recognized a net loss of $1.1 million due to the decrease in fair value of equity investments with readily determinable fair values, compared to a net gain of $5.7 million in 2019. Equity securities were $23.7 million as of December 31, 2020, compared to $28.0 million as of December 31, 2019.