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Investment Securities
 3 Months Ended
Mar. 31, 2017
Investments, Debt and Equity Securities [Abstract]  
Investment Securities
Investment Securities
 
The following table presents investment securities at March 31, 2017 and December 31, 2016, showing that available-for-sale and held-to-maturity securities decreased from December 31, 2016 primarily due to payoffs in MBS securities with runoff not replaced to facilitate the pending merger with FIBK (dollars in thousands):
 
Amortized
cost
 
Gross
unrealized
gains
 
Gross
unrealized
losses
 
Estimated
fair value
March 31, 2017
 

 
 

 
 
 
 

Available-for-sale
 

 
 

 
 

 
 

U.S. Agency mortgage-backed securities (MBS)
$
158,881

 
$
1,939

 
$
(317
)
 
$
160,503

Non-agency MBS
232,213

 
271

 
(2,202
)
 
230,282

U.S. Agency asset-backed securities
6,424

 
416

 
(62
)
 
6,778

Corporate securities
71,232

 
583

 
(215
)
 
71,600

Mutual fund
540

 
17

 
—

 
557

 
$
469,290

 
$
3,226

 
$
(2,796
)
 
$
469,720

Held-to-maturity
 
 
 
 
 
 
 
U.S. Agency MBS
$
100,305

 
$
1,606

 
$
(110
)
 
$
101,801

Obligations of state and political subdivisions
38,604

 
1,001

 
(99
)
 
39,506

Tax credit investments
287

 
—

 
—

 
287

 
$
139,196

 
$
2,607

 
$
(209
)
 
$
141,594

 
 
 
 
 
 
 
 
December 31, 2016
 

 
 

 
 

 
 

Available-for-sale
 

 
 

 
 

 
 

U.S. Agency MBS
$
165,933

 
$
1,828

 
$
(799
)
 
$
166,962

Non-agency MBS
252,153

 
203

 
(3,408
)
 
248,948

U.S. Agency asset-backed securities
6,700

 
419

 
(57
)
 
7,062

Corporate securities
71,213

 
397

 
(287
)
 
71,323

Mutual fund
537

 
—

 
(13
)
 
524

 
$
496,536

 
$
2,847

 
$
(4,564
)
 
$
494,819

Held-to-maturity
 

 
 

 
 

 
 

U.S. Agency MBS
$
101,563

 
$
1,195

 
$
(148
)
 
$
102,610

Obligations of state and political subdivisions
287

 
—

 
—

 
287

Tax credit investments
38,707

 
770

 
(102
)
 
39,375

 
$
140,557

 
$
1,965

 
$
(250
)
 
$
142,272


 
The following table presents the contractual maturities of investment securities at March 31, 2017 (dollars in thousands):
 
 
Available-for-sale
 
Held-to-maturity
 
Amortized
cost
 
Estimated
fair value
 
Amortized
cost
 
Estimated
fair value
Due in one year or less
$
3,485

 
$
3,495

 
$
1,834

 
$
1,836

Due after one year through five years
75,171

 
75,533

 
37,830

 
38,134

Due after five years through ten years
39,777

 
39,912

 
82,476

 
84,533

Due after ten years
350,317

 
350,223

 
16,769

 
16,804

Mutual fund
540

 
557

 
—

 
—

Tax credit investments
—

 
—

 
287

 
287

 
$
469,290

 
$
469,720

 
$
139,196

 
$
141,594

 
The following table presents the fair value and gross unrealized losses of the Bank’s investment securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at March 31, 2017 and December 31, 2016 (dollars in thousands):
 
 
Less than 12 months

12 months or more

Total
 
Estimated 
fair value

Unrealized
losses

Estimated 
fair value

Unrealized
losses

Estimated 
fair value

Unrealized
losses
March 31, 2017
 


 


 


 


 


 

Available-for-sale
 
 
 
 
 
 
 
 
 
 
 
U.S. Agency MBS
$
43,949


$
(300
)

$
3,945


$
(17
)

$
47,894


$
(317
)
Non-Agency MBS
160,190


(2,062
)

13,734


(140
)

173,924


(2,202
)
U.S. Agency asset-backed securities
—


—


1,887


(62
)

1,887


(62
)
Corporate Securities
6,781

 
(215
)
 
—

 
—

 
6,781

 
(215
)
 
$
210,920


$
(2,577
)

$
19,566


$
(219
)

$
230,486


$
(2,796
)


















Held-to-maturity
 
 
 
 
 
 
 
 
 
 
 
U.S. Agency MBS
$
4,868

 
$
(110
)
 
$
—

 
$
—

 
$
4,868

 
$
(110
)
Obligations of state and political subdivisions
1,935

 
(99
)
 
—

 
—

 
1,935

 
(99
)
 
$
6,803

 
$
(209
)
 
$
—

 
$
—

 
$
6,803

 
$
(209
)
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2016
 

 
 

 
 

 
 

 
 

 
 

Available-for-sale
 
 
 
 
 
 
 
 
 
 
 
U.S. Agency MBS
$
51,082

 
$
(786
)
 
$
1,733

 
$
(13
)
 
$
52,815

 
$
(799
)
Non-Agency MBS
211,909

 
(3,268
)
 
1,933

 
(140
)
 
213,842

 
(3,408
)
U.S. Agency asset-backed securities
—

 
—

 
1,918

 
(57
)
 
1,918

 
(57
)
Corporate Securities
6,709

 
(287
)
 
—

 
—

 
6,709

 
(287
)
Mutual Fund
524

 
(13
)
 
 
 
 
 
524

 
(13
)
 
$
270,224

 
$
(4,354
)
 
$
5,584

 
$
(210
)
 
$
275,808

 
$
(4,564
)
 
 
 
 
 
 
 
 
 
 
 
 
Held-to-maturity
 
 
 
 
 
 
 
 
 
 
 
U.S. Agency MBS
7,641

 
(148
)
 
—

 
—

 
$
7,641

 
$
(148
)
Obligations of state and political subdivisions
1,942

 
(102
)
 
—

 
—

 
1,942

 
(102
)
 
$
9,583

 
$
(250
)
 
$
—

 
$
—

 
$
9,583

 
$
(250
)

 
The unrealized losses on investments in U.S. Agency and non-agency MBS, U.S. Agency asset-backed securities, and corporate securities are primarily due to elevated yield/rate spreads at March 31, 2017 and December 31, 2016 as compared to yield/rate spread relationships prevailing at the time specific investment securities were purchased. The Company had 79 and 87 securities in the loss position at March 31, 2017 and December 31, 2016, respectively. Management expects the fair value of these investment securities to recover as securities approach their maturity dates. Management does not believe that the above gross unrealized losses on investment securities are other-than-temporary. Accordingly, no impairment adjustments have been recorded.
 
Management intends to hold the investment securities classified as held-to-maturity until they mature, at which time the Company will receive full amortized cost value for such investment securities. Furthermore, as of March 31, 2017, management did not have the intent to sell any of the securities classified as held-to-maturity in the table above and believes that it is more likely than not that the Company will not have to sell any such securities before a recovery of cost.