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Securities
 12 Months Ended
Dec. 31, 2016
Marketable Securities [Abstract]  
Securities [Text Block]
Securities
Trading Securities
 
The fair value and net unrealized gain (loss) included in trading securities is as follows (in thousands):
 
 
 
December 31, 2016
 
December 31, 2015
 
 
Fair Value
 
Net Unrealized Gain (Loss)
 
Fair Value
 
Net Unrealized Gain (Loss)
U.S. government agency debentures
 
$
6,234

 
$
(4
)
 
$
61,295

 
$
(71
)
U.S. government agency residential mortgage-backed securities
 
310,067

 
635

 
10,989

 
17

Municipal and other tax-exempt securities
 
14,427

 
50

 
31,901

 
210

Other trading securities
 
6,900

 
57

 
18,219

 
(16
)
Total trading securities
 
$
337,628

 
$
738

 
$
122,404

 
$
140


Investment Securities
 
The amortized cost and fair values of investment securities are as follows (in thousands):

 
 
December 31, 2016
 
 
Amortized
 
Carrying
 
Fair
 
Gross Unrealized1
 
 
Cost
 
Value
 
Value
 
Gain
 
Loss
Municipal and other tax-exempt securities
 
$
320,364

 
$
320,364

 
$
321,225

 
$
2,272

 
$
(1,411
)
U.S. government agency residential mortgage-backed securities – Other
 
20,777

 
20,777

 
21,473

 
767

 
(71
)
Other debt securities
 
205,004

 
205,004

 
222,795

 
18,115

 
(324
)
Total investment securities
 
$
546,145

 
$
546,145

 
$
565,493

 
$
21,154

 
$
(1,806
)

1 
Gross unrealized gains and losses are not recognized in AOCI in the Consolidated Balance Sheets.
 
 
December 31, 2015
 
 
Amortized
 
Carrying
 
Fair
 
Gross Unrealized1
 
 
Cost
 
Value
 
Value
 
Gain
 
Loss
Municipal and other tax-exempt securities
 
$
365,258

 
$
365,258

 
$
368,910

 
$
3,935

 
$
(283
)
U.S. government agency residential mortgage-backed securities – Other
 
26,721

 
26,833

 
27,874

 
1,063

 
(22
)
Other debt securities
 
205,745

 
205,745

 
232,375

 
26,689

 
(59
)
Total investment securities
 
$
597,724

 
$
597,836

 
$
629,159

 
$
31,687

 
$
(364
)

1 
Gross unrealized gains and losses are not recognized in AOCI in the Consolidated Balance Sheets.

The amortized cost and fair values of investment securities at December 31, 2016, by contractual maturity, are as shown in the following table (dollars in thousands):
 
 
Less than
One Year
 
One to
Five Years
 
Six to
Ten Years
 
Over
Ten Years
 
Total
 
Weighted
Average
Maturity²
Municipal and other tax-exempt securities:
 
 
 
 
 
 
 
 
 
 
 
 
Carrying value
 
$
83,583

 
$
181,596

 
$
5,909

 
$
49,276

 
$
320,364

 
3.41

Fair value
 
83,544

 
180,993

 
5,836

 
50,852

 
321,225

 
 
Nominal yield¹
 
1.48
%
 
2.08
%
 
3.31
%
 
5.20
%
 
2.43
%
 
 
Other debt securities:
 
 

 
 

 
 

 
 

 
 

 
 
Carrying value
 
$
16,045

 
$
41,804

 
$
127,320

 
$
19,835

 
$
205,004

 
6.66

Fair value
 
16,107

 
44,372

 
142,010

 
20,306

 
222,795

 
 
Nominal yield
 
3.28
%
 
5.14
%
 
5.86
%
 
4.79
%
 
5.41
%
 
 
Total fixed maturity securities:
 
 

 
 

 
 

 
 

 
 

 
 
Carrying value
 
$
99,628

 
$
223,400

 
$
133,229

 
$
69,111

 
$
525,368

 
4.68

Fair value
 
99,651

 
225,365

 
147,846

 
71,158

 
544,020

 
 

Nominal yield
 
1.77
%
 
2.65
%
 
5.75
%
 
5.08
%
 
3.59
%
 
 

Residential mortgage-backed securities:
 
 

 
 

 
 

 
 

 
 

 
 

Carrying value
 
 

 
 

 
 

 
 

 
$
20,777

 
³

Fair value
 
 

 
 

 
 

 
 

 
21,473

 
 

Nominal yield4
 
 

 
 

 
 

 
 

 
2.76
%
 
 

Total investment securities:
 
 

 
 

 
 

 
 

 
 

 
 

Carrying value
 
 

 
 

 
 

 
 

 
$
546,145

 
 

Fair value
 
 

 
 

 
 

 
 

 
565,493

 
 

Nominal yield
 
 

 
 

 
 

 
 

 
3.56
%
 
 

1 
Calculated on a taxable equivalent basis using a 39% effective tax rate.
2 
Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without penalty.
3 
The average expected lives of residential mortgage-backed securities were 4.7 years based upon current prepayment assumptions.
4 
The nominal yield on residential mortgage-backed securities is based upon prepayment assumptions at the purchase date. Actual yields earned may differ significantly based upon actual prepayments. See Quarterly Financial Summary - Unaudited for current yields on the investment securities portfolio.

Available for Sale Securities 

The amortized cost and fair value of available for sale securities are as follows (in thousands):
 
 
December 31, 2016
 
 
Amortized
 
Fair
 
Gross Unrealized1
 
 
 
 
Cost
 
Value
 
Gain
 
Loss
 
OTTI²
U.S. Treasury securities
 
$
1,000

 
$
999

 
$
—

 
$
(1
)
 
$
—

Municipal and other tax-exempt securities
 
41,050

 
40,993

 
343

 
(400
)
 
—

Residential mortgage-backed securities:
 
 

 
 

 
 

 
 

 
 

U.S. government agencies:
 
 

 
 

 
 

 
 

 
 

FNMA
 
3,062,525

 
3,055,676

 
25,066

 
(31,915
)
 
—

FHLMC
 
1,534,451

 
1,531,116

 
8,475

 
(11,810
)
 
—

GNMA
 
878,375

 
873,594

 
2,259

 
(7,040
)
 
—

Total U.S. government agencies
 
5,475,351

 
5,460,386

 
35,800

 
(50,765
)
 
—

Private issue:
 
 

 
 

 
 

 
 

 
 

Alt-A loans
 
44,245

 
51,512

 
7,485

 
—

 
(218
)
Jumbo-A loans
 
56,947

 
64,023

 
7,092

 
(16
)
 
—

Total private issue
 
101,192

 
115,535

 
14,577

 
(16
)
 
(218
)
Total residential mortgage-backed securities
 
5,576,543


5,575,921

 
50,377

 
(50,781
)
 
(218
)
Commercial mortgage-backed securities guaranteed by U.S. government agencies
 
3,035,750

 
3,017,933

 
5,472

 
(23,289
)
 
—

Other debt securities
 
4,400

 
4,152

 
—

 
(248
)
 
—

Perpetual preferred stock
 
15,561

 
18,474

 
2,913

 
—

 
—

Equity securities and mutual funds
 
17,424

 
18,357

 
1,060

 
(127
)
 
—

Total available for sale securities
 
$
8,691,728

 
$
8,676,829

 
$
60,165

 
$
(74,846
)
 
$
(218
)
1 
Gross unrealized gain/loss recognized in AOCI in the consolidated balance sheet.
2
Amounts represent unrealized loss that remains in AOCI after an other-than-temporary credit loss has been recognized in income.
 
 
December 31, 2015
 
 
Amortized
 
Fair
 
Gross Unrealized¹
 
 
 
 
Cost
 
Value
 
Gain
 
Loss
 
OTTI²
U.S. Treasury securities
 
$
1,000

 
$
995

 
$
—

 
$
(5
)
 
$
—

Municipal and other tax-exempt securities
 
56,681

 
56,817

 
873

 
(737
)
 
—

Residential mortgage-backed securities:
 
 
 
 

 
 

 
 

 
 

U.S. government agencies:
 
 

 
 

 
 

 
 

 
 

FNMA
 
3,156,214

 
3,187,215

 
41,502

 
(10,501
)
 
—

FHLMC
 
1,940,915

 
1,949,335

 
14,727

 
(6,307
)
 
—

GNMA
 
763,967

 
761,801

 
2,385

 
(4,551
)
 
—

Total U.S. government agencies
 
5,861,096

 
5,898,351

 
58,614

 
(21,359
)
 
—

Private issue:
 
 

 
 

 
 

 
 

 
 

Alt-A loans
 
56,387

 
62,574

 
6,574

 
—

 
(387
)
Jumbo-A loans
 
71,724

 
76,544

 
5,260

 
—

 
(440
)
Total private issue
 
128,111

 
139,118

 
11,834

 
—

 
(827
)
Total residential mortgage-backed securities
 
5,989,207

 
6,037,469

 
70,448

 
(21,359
)
 
(827
)
Commercial mortgage-backed securities guaranteed by U.S. government agencies
 
2,919,044

 
2,905,796

 
5,396

 
(18,644
)
 
—

Other debt securities
 
4,400

 
4,151

 
—

 
(249
)
 
—

Perpetual preferred stock
 
17,171

 
19,672

 
2,501

 
—

 
—

Equity securities and mutual funds
 
17,121

 
17,833

 
752

 
(40
)
 
—

Total available for sale securities
 
$
9,004,624

 
$
9,042,733

 
$
79,970

 
$
(41,034
)
 
$
(827
)
1
Gross unrealized gain/loss recognized in AOCI in the consolidated balance sheet.
2
Amounts represent unrealized loss that remains in AOCI after an other-than-temporary credit loss has been recognized in income.


The amortized cost and fair values of available for sale securities at December 31, 2016, by contractual maturity, are as shown in the following table (dollars in thousands):
 
Less than
One Year
 
One to
Five Years
 
Six to
Ten Years
 
Over
Ten Years
 
Total
 
Weighted
Average
Maturity5
U.S. Treasury securities:
 
 
 
 
 
 
 
 
 
 
 
Amortized cost
$
—

 
$
1,000

 
$
—

 
$
—

 
$
1,000

 
1.04

Fair value
—

 
999

 
—

 
—

 
999

 
 
Nominal yield
—
%
 
0.87
%
 
—
%
 
—
%
 
0.87
%
 
 
Municipal and other tax-exempt securities:
 

 
 

 
 

 
 

 
 

 
 
Amortized cost
9,848

 
12,254

 
2,103

 
16,845

 
41,050

 
7.95

Fair value
9,903

 
12,399

 
2,151

 
16,540

 
40,993

 
 
Nominal yield¹
4.81
%
 
4.01
%
 
3.47
%
 
2.28
%
6 

3.46
%
 
 
Commercial mortgage-backed securities:
 

 
 

 
 

 
 

 
 

 
 
Amortized cost
31,910

 
921,981

 
1,832,535

 
249,324

 
3,035,750

 
6.90

Fair value
31,856

 
920,108

 
1,820,627

 
245,342

 
3,017,933

 
 
Nominal yield
1.00
%
 
1.79
%
 
1.85
%
 
1.82
%
 
1.81
%
 
 
Other debt securities:
 
 
 
 
 
 
 
 
 
 
 
Amortized cost
—

 
—

 
—

 
4,400

 
4,400

 
30.66

Fair value
—

 
—

 
—

 
4,152

 
4,152

 
 
Nominal yield
—
%
 
—
%
 
—
%
 
1.71
%
 
1.71
%
 
 
Total fixed maturity securities:
 

 
 

 
 

 
 

 
 

 
 
Amortized cost
$
41,758

 
$
935,235

 
$
1,834,638

 
$
270,569

 
$
3,082,200

 
6.95

Fair value
41,759

 
933,506

 
1,822,778

 
266,034

 
3,064,077

 
 
Nominal yield
1.89
%
 
1.82
%
 
1.85
%
 
1.84
%
 
1.83
%
 
 
Residential mortgage-backed securities:
 

 
 

 
 

 
 

 
 

 
 
Amortized cost
 

 
 

 
 

 
 

 
$
5,576,543

 
2 

Fair value
 

 
 

 
 

 
 

 
5,575,921

 
 
Nominal yield4
 

 
 

 
 

 
 

 
1.86
%
 
 
Perpetual preferred stock. equity securities and mutual funds:
 

 
 

 
 

 
 

 
 

 
 

Amortized cost
 

 
 

 
 

 
 

 
$
32,985

 
³

Fair value
 

 
 

 
 

 
 

 
36,831

 
 

Nominal yield
 

 
 

 
 

 
 

 
—
%
 
 

Total available-for-sale securities:
 

 
 

 
 

 
 

 
 
 
 

Amortized cost
 

 
 

 
 

 
 

 
$
8,691,728

 
 

Fair value
 

 
 

 
 

 
 

 
8,676,829

 
 

Nominal yield
 

 
 

 
 

 
 

 
1.84
%
 
 

1 
Calculated on a taxable equivalent basis using a 39% effective tax rate.
2 
The average expected lives of mortgage-backed securities were 3.9 years based upon current prepayment assumptions.
3 
Primarily common stock and preferred stock of corporate issuers with no stated maturity.
4 
The nominal yield on mortgage-backed securities is based upon prepayment assumptions at the purchase date. Actual yields earned may differ significantly based upon actual prepayments. See Quarterly Financial Summary –– Unaudited following for current yields on available for sale securities portfolio.
5 
Expected maturities may differ from contractual maturities, because borrowers may have the right to call or prepay obligations with or without penalty.
6 
Nominal yield on municipal and other tax-exempt securities and other debt securities with contractual maturity dates over ten years are based on variable rates which generally are reset within 35 days.


Sales of available for sale securities resulted in gains and losses as follows (in thousands):
 
Year Ended December 31,
 
2016
 
2015
 
2014
Proceeds
$
899,381

 
$
1,600,380

 
2,664,740

Gross realized gains
11,696

 
15,849

 
24,923

Gross realized losses
(21
)
 
(3,791
)
 
(23,384
)
Related federal and state income tax expense
4,542

 
4,691

 
599



A summary of investment and available for sale securities that have been pledged as collateral for repurchase agreements, public trust funds on deposit and for other purposes, as required by law was as follows (in thousands):
 
December 31,
 
2016
 
2015
Investment:
 
 
 
Carrying value
$
322,208

 
$
231,033

Fair value
323,808

 
234,382

 
 
 
 
Available for sale:
 
 
 
Amortized cost
7,353,116

 
6,831,743

Fair value
7,327,470

 
6,849,524



The secured parties do not have the right to sell or re-pledge these securities.

Temporarily Impaired Securities as of December 31, 2016
(In thousands)
 
 
Number of Securities
 
Less Than 12 Months
 
12 Months or Longer
 
Total
 
 
 
Fair
Value
 
Unrealized
Loss
 
Fair
Value
 
Unrealized
Loss
 
Fair
Value
 
Unrealized
Loss
Investment:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Municipal and other tax-exempt securities
 
151

 
$
219,892

 
$
1,316

 
$
4,333

 
$
95

 
$
224,225

 
$
1,411

U.S. government agency residential mortgage-backed securities – Other
 
1

 
4,358

 
71

 
—

 
—

 
4,358

 
71

Other debt securities
 
41

 
11,820

 
322

 
855

 
2

 
12,675

 
324

Total investment securities
 
193

 
$
236,070

 
$
1,709

 
$
5,188

 
$
97

 
$
241,258

 
$
1,806


 
 
Number of Securities
 
Less Than 12 Months
 
12 Months or Longer
 
Total
 
 
 
Fair
Value
 
Unrealized
Loss
 
Fair
Value
 
Unrealized
Loss
 
Fair
Value
 
Unrealized
Loss
Available for sale:
 
 

 
 

 
 

 
 

 
 

 
 

 
 

U.S. Treasury securities
 
1

 
$
999

 
$
1

 
$
—

 
$
—

 
$
999

 
$
1

Municipal and other tax-exempt securities
 
24

 
$
15,666

 
$
22

 
$
4,689

 
$
378

 
20,355

 
400

Residential mortgage-backed securities:
 
 
 
 

 
 

 
 

 
 

 


 


U.S. government agencies:
 
 
 
 

 
 

 
 

 
 

 


 


FNMA
 
91

 
1,787,644

 
30,238

 
72,105

 
1,677

 
1,859,749

 
31,915

FHLMC
 
58

 
964,017

 
11,210

 
18,307

 
600

 
982,324

 
11,810

GNMA
 
31

 
548,637

 
6,145

 
25,796

 
895

 
574,433

 
7,040

Total U.S. agencies
 
180

 
3,300,298

 
47,593

 
116,208

 
3,172

 
3,416,506

 
50,765

Private issue1:
 
 

 
 

 
 

 
 

 
 

 


 


Alt-A loans
 
5

 
7,931

 
174

 
7,410

 
44

 
15,341

 
218

Jumbo-A loans
 
1

 
—

 
—

 
6,098

 
16

 
6,098

 
16

Total private issue
 
6

 
7,931

 
174

 
13,508

 
60

 
21,439

 
234

Total residential mortgage-backed securities
 
186

 
3,308,229

 
47,767

 
129,716

 
3,232

 
3,437,945

 
50,999

Commercial mortgage-backed securities guaranteed by U.S. government agencies
 
171

 
1,904,584

 
22,987

 
38,875

 
302

 
1,943,459

 
23,289

Other debt securities
 
2

 
—

 
—

 
4,152

 
248

 
4,152

 
248

Perpetual preferred stock
 
—

 
—

 
—

 
—

 
—

 
—

 
—

Equity securities and mutual funds
 
104

 
2,127

 
41

 
817

 
86

 
2,944

 
127

Total available for sale securities
 
488

 
$
5,231,605

 
$
70,818

 
$
178,249

 
$
4,246

 
$
5,409,854

 
$
75,064

1 
Includes securities for which an unrealized loss remains in AOCI after an other-than-temporary credit loss has been recognized in income.

Temporarily Impaired Securities as of December 31, 2015
(In thousands)
 
 
Number of Securities
 
Less Than 12 Months
 
12 Months or Longer
 
Total
 
 
 
Fair
Value
 
Unrealized
Loss
 
Fair
Value
 
Unrealized
Loss
 
Fair
Value
 
Unrealized
Loss
Investment:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Municipal and other tax- exempt securities
 
73

 
$
127,319

 
$
206

 
$
13,380

 
$
77

 
$
140,699

 
$
283

U.S. government agency residential mortgage-backed securities – Other
 
1

 
5,533

 
22

 
—

 
—

 
5,533

 
22

Other debt securities
 
11

 
1,082

 
41

 
1,715

 
18

 
2,797

 
59

Total investment securities
 
85

 
$
133,934

 
$
269

 
$
15,095

 
$
95

 
$
149,029

 
$
364


 
 
Number of Securities
 
Less Than 12 Months
 
12 Months or Longer
 
Total
 
 
 
Fair
Value
 
Unrealized
Loss
 
Fair
Value
 
Unrealized
Loss
 
Fair
Value
 
Unrealized
Loss
Available for sale:
 
 

 
 

 
 

 
 

 
 

 


 


U.S. Treasury securities
 
1

 
$
995

 
$
5

 
$
—

 
$
—

 
$
995

 
$
5

Municipal and other tax-exempt securities
 
20

 
$
9,909

 
$
27

 
$
11,664

 
$
710

 
21,573

 
737

Residential mortgage-backed securities:
 
 

 
 

 
 

 
 

 
 

 


 


U. S. government agencies:
 
 

 
 

 
 

 
 

 
 

 


 


FNMA
 
55

 
1,188,022

 
10,262

 
18,236

 
239

 
1,206,258

 
10,501

FHLMC
 
40

 
726,713

 
4,827

 
77,545

 
1,480

 
804,258

 
6,307

GNMA
 
15

 
364,919

 
1,951

 
102,109

 
2,600

 
467,028

 
4,551

Total U.S. agencies
 
110

 
2,279,654

 
17,040

 
197,890

 
4,319

 
2,477,544

 
21,359

Private issue1:
 
 

 
 

 
 

 
 

 
 

 


 


Alt-A loans
 
4

 
—

 
—

 
9,264

 
387

 
9,264

 
387

Jumbo-A loans
 
8

 
—

 
—

 
8,482

 
440

 
8,482

 
440

Total private issue
 
12

 
—

 
—

 
17,746

 
827

 
17,746

 
827

Total residential mortgage-backed securities
 
122

 
2,279,654

 
17,040

 
215,636

 
5,146

 
2,495,290

 
22,186

Commercial mortgage-backed securities guaranteed by U.S. government agencies
 
213

 
1,582,469

 
11,419

 
484,258

 
7,225

 
2,066,727

 
18,644

Other debt securities
 
2

 
—

 
—

 
4,151

 
249

 
4,151

 
249

Perpetual preferred stock
 
—

 
—

 
—

 
—

 
—

 
—

 
—

Equity securities and mutual funds
 
61

 
782

 
5

 
991

 
35

 
1,773

 
40

Total available for sale securities
 
419


$
3,873,809


$
28,496


$
716,700


$
13,365


$
4,590,509


$
41,861

1 
Includes securities for which an unrealized loss remains in AOCI after an other-than-temporary credit loss has been recognized in income.

For debt securities, management determines whether it intends to sell or if it is more-likely-than-not that it will be required to sell impaired securities.  Based on this evaluation as of December 31, 2016, we do not intend to sell any impaired available for sale securities before fair value recovers to our current amortized cost and it is more-likely-than-not that we will not be required to sell impaired securities before fair value recovers, which may be maturity.


At December 31, 2016, the composition of the Company’s investment and available for sale securities portfolios by the lowest current credit rating assigned by any of the three nationally-recognized rating agencies is as follows (in thousands):
 
 

AAA - AA
 
 
A - BBB
 
Below Investment Grade
 
 
Not Rated
 
 
Total
 
 
Carrying
Value
 
Fair
Value
 
Carrying
Value
 
Fair
Value
 
Carrying
Value
 
Fair
Value
 
Carrying
Value
 
Fair
Value
 
Carrying
Value
 
Fair
Value
Investment:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Municipal and other tax-exempt
 
$
193,931

 
$
193,834

 
$
6,028

 
$
6,037

 
$
—

 
$
—

 
$
120,405

 
$
121,354

 
$
320,364

 
$
321,225

U.S. government agency residential mortgage-backed securities1
 
—

 
—

 
—

 
—

 
—

 
—

 
20,777

 
21,473

 
20,777

 
21,473

Other debt securities
 
140,184

 
156,641

 
—

 
—

 
—

 
—

 
64,820

 
66,154

 
205,004

 
222,795

Total investment securities
 
$
334,115

 
$
350,475

 
$
6,028

 
$
6,037

 
$
—

 
$
—

 
$
206,002

 
$
208,981

 
$
546,145

 
$
565,493

 
 
AAA - AA
 
 
A - BBB
 
Below Investment Grade
 
Not Rated
 
Total
 
 
Amortized Cost
 
Fair Value
 
Amortized Cost
 
Fair Value
 
Amortized Cost
 
Fair Value
 
Amortized Cost
 
Fair Value
 
Amortized Cost
 
Fair
Value
Available for Sale:
 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

U.S. Treasury securities
 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
—

 
$
1,000

 
$
999

 
$
1,000

 
$
999

Municipal and other tax-exempt
 
23,343

 
23,657

 
5,595

 
5,237

 
—

 
—

 
12,112

 
12,099

 
41,050

 
40,993

U.S. government agency residential mortgage-backed securities1
 
—

 
—

 
—

 
—

 
—

 
—

 
5,475,351

 
5,460,386

 
5,475,351

 
5,460,386

Privately issued residential mortgage-backed securities
 
—

 
—

 
—

 
—

 
101,192

 
115,535

 
—

 
—

 
101,192

 
115,535

Commercial mortgage-backed securities guaranteed by U.S. government agencies
 
—

 
—

 
—

 
—

 
—

 
—

 
3,035,750

 
3,017,933

 
3,035,750

 
3,017,933

Other debt securities
 
4,400

 
4,152

 
—

 
—

 
—

 
—

 
—

 
—

 
4,400

 
4,152

Perpetual preferred stock
 
—

 
—

 
4,796

 
5,177

 
10,765

 
13,297

 
—

 
—

 
15,561

 
18,474

Equity securities and mutual funds
 
4

 
759

 
—

 
—

 
—

 
—

 
17,420

 
17,598

 
17,424

 
18,357

Total available for sale securities
 
$
27,747


$
28,568


$
10,391


$
10,414


$
111,957


$
128,832


$
8,541,633


$
8,509,015


$
8,691,728


$
8,676,829

1 
U.S. government and government sponsored enterprises are not rated by the nationally-recognized rating agencies as these securities are guaranteed by agencies of the U.S. government or government-sponsored enterprises.

At December 31, 2016, the entire portfolio of privately issued residential mortgage-backed securities was rated below investment grade by at least one of the nationally-recognized rating agencies. The gross unrealized loss on these securities totaled $234 thousand. Impairment of these securities was evaluated based on projections of estimated cash flows.

The primary assumptions used in this evaluation were:

 
December 31,
 
2016
 
2015
 
 
 
 
Unemployment rate
Decreasing to 4.6% over the next 12 months and remain at 4.6% thereafter.
 
Decreasing to 4.8% over the next 12 months and remain at 4.8% thereafter.
Housing price appreciation/depreciation
Starting with current depreciated housing prices based on information derived from the FHFA1, appreciating 3.1% over the next 12 months, then flat for the following 12 months and then appreciating at 2% per year thereafter.
 
Starting with current depreciated housing prices based on information derived from the FHFA1, appreciating 3.5% over the next 12 months, then flat for the following 12 months and then appreciating at 2% per year thereafter.
Estimated liquidation costs
Reflect actual historical liquidations costs observed on Jumbo and Alt-A residential mortgage loans in securities owned by the Company.
 
Reflect actual historical liquidations costs observed on Jumbo and Alt-A residential mortgage loans in securities owned by the Company.
Discount rates
Estimated cash flows were discounted at rates that range from 2.00% to 6.25% based on our current expected yields.
 
Estimated cash flows were discounted at rates that range from 2.00% to 6.25% based on our current expected yields.

1 
Federal Housing Finance Agency



The Company recognized no credit loss impairment on private-label residential mortgage-backed securities in earnings during 2016. Credit loss impairment of $157 thousand was recognized in earnings on private-label residential mortgage-backed securities in 2015 and none was recognized in 2014.

Impaired equity securities, including perpetual preferred stocks, are evaluated based on management's ability and intent to hold the securities until fair value recovers. Based on this evaluation, no other-than-temporary impairment losses were recorded in earnings on equity securities during 2016. A $1.7 million other-than-temporary impairment loss related to equity securities was recorded in earnings in 2015 and $373 thousand in impairment losses were recognized on equity securities in 2014.

The following is a tabular roll forward of the amount of credit-related OTTI recognized on available for sale debt securities in earnings (in thousands):
 
 
Year Ended December 31,
 
 
2016
 
2015
 
2014
Balance of credit-related OTTI recognized on available for sale debt, beginning of period
 
$
54,504

 
$
54,347

 
$
67,346

Additions for credit-related OTTI not previously recognized
 
—

 
—

 
—

Additions for increases in credit-related OTTI previously recognized when there is no intent to sell and no requirement to sell before recovery of amortized cost
 
—

 
157

 
—

Reductions for change in intent to hold before recovery
 
—

 
—

 
—

Sales
 
—

 
—

 
(12,999
)
Balance of credit-related OTTI recognized on available for sale debt securities, end of period
 
$
54,504

 
$
54,504

 
$
54,347


Fair Value Option Securities
 
Fair value option securities represent securities which the Company has elected to carry at fair value and separately identified on the Consolidated Balance Sheets with changes in the fair value recognized in earnings as they occur. Certain residential mortgage-backed securities issued by U.S. government agencies and derivative contracts are held as an economic hedge of the mortgage servicing rights. 

The fair value and net unrealized gain (loss) included in Fair value option securities is as follows (in thousands):
 
 
December 31, 2016
 
December 31, 2015
 
 
Fair Value
 
Net Unrealized Gain (Loss)
 
Fair Value
 
Net Unrealized Gain (Loss)
U.S. government agency residential mortgage-backed securities
 
$
77,046

 
$
(1,777
)
 
$
444,217

 
$
(2,060
)



Restricted Equity Securities

Restricted equity securities include stock we are required to hold as members of the Federal Reserve system and the Federal Home Loan Banks ("FHLB"). Restricted equity securities are carried at cost as these securities do not have a readily determined fair value because ownership of these shares is restricted and they lack a market. A summary of restricted equity securities follows (in thousands):

 
December 31,
 
2016
 
2015
Federal Reserve Bank stock
$
36,498

 
$
36,148

Federal Home Loan Bank stock
270,541

 
237,365

Other
201

 
171

Total
$
307,240

 
$
273,684