Securities

Trading Securities

The fair value and net unrealized gain (loss) included in trading securities are as follows (in thousands):



	September 30, 2017					December 31, 2016					September 30, 2016
	Fair Value		Net Unrealized Gain (Loss)			Fair Value		Net Unrealized Gain (Loss)			Fair Value		Net Unrealized Gain (Loss)
U.S. government agency debentures	$	30,162	$	(101	)	$	6,234	$	(4	)	$	15,705	$	(7	)
U.S. government agency residential mortgage-backed securities	516,760		723			310,067		635			464,749		876
Municipal and other tax-exempt securities	56,148		153			14,427		50			54,856		(100		)
Other trading securities	11,047		23			6,900		57			11,305		14
Total trading securities	$	614,117	$	798		$	337,628	$	738		$	546,615	$	783

Investment Securities

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



	September 30, 2017
	Amortized		Fair		Gross Unrealized¹
	Cost		Value		Gain		Loss
Municipal and other tax-exempt	$	246,000	$	249,250	$	3,415	$	(165	)
U.S. government agency residential mortgage-backed securities – Other	16,926		17,458		594		(62		)
Other debt securities	203,636		223,187		20,141		(590		)
Total investment securities	$	466,562	$	489,895	$	24,150	$	(817	)


¹	Gross unrealized gains and losses are not recognized in Accumulated Other Comprehensive Income "AOCI" in the Consolidated Balance Sheets.



	December 31, 2016
	Amortized		Fair		Gross Unrealized¹
	Cost		Value		Gain		Loss
Municipal and other tax-exempt	$	320,364	$	321,225	$	2,272	$	(1,411	)
U.S. government agency residential mortgage-backed securities – Other	20,777		21,473		767		(71		)
Other debt securities	205,004		222,795		18,115		(324		)
Total investment securities	$	546,145	$	565,493	$	21,154	$	(1,806	)


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



	September 30, 2016
	Amortized		Fair		Gross Unrealized¹
	Cost		Value		Gain		Loss
Municipal and other tax-exempt	$	323,225	$	327,788	$	4,745	$	(182	)
U.S. government agency residential mortgage-backed securities – Other	22,166		23,452		1,286		—
Other debt securities	201,066		229,070		28,014		(10		)
Total investment securities	$	546,457	$	580,310	$	34,045	$	(192	)


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 September 30, 2017, 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:
Amortized cost	$	84,786		$	107,938		$	16,132		$	37,144		$	246,000		3.51
Fair value	84,835			108,352			16,776			39,287			249,250
Nominal yield¹	1.75		%	2.15		%	4.68		%	5.21		%	2.64		%
Other debt securities:
Amortized cost	13,546			47,077			130,494			12,519			203,636			6.40
Fair value	13,688			50,230			147,066			12,203			223,187
Nominal yield	4.10		%	4.86		%	5.75		%	4.47		%	5.35		%
Total fixed maturity securities:
Amortized cost	$	98,332		$	155,015		$	146,626		$	49,663		$	449,636		4.82
Fair value	98,523			158,582			163,842			51,490			472,437
Nominal yield	2.08		%	2.97		%	5.63		%	5.02		%	3.87		%
Residential mortgage-backed securities:
Amortized cost													$	16,926		³
Fair value													17,458
Nominal yield⁴													2.76		%
Total investment securities:
Amortized cost													$	466,562
Fair value													489,895
Nominal yield													3.83		%


¹	Calculated on a taxable equivalent basis using a 39 percent 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):



	September 30, 2017
	Amortized		Fair		Gross Unrealized¹
	Cost		Value		Gain		Loss			OTTI²
U.S. Treasury	$	1,000	$	999	$	—	$	(1	)	$	—
Municipal and other tax-exempt	28,411		28,368		240		(283		)	—
Residential mortgage-backed securities:
U. S. government agencies:
FNMA	3,103,869		3,108,822		25,510		(20,557		)	—
FHLMC	1,331,212		1,330,159		6,630		(7,683		)	—
GNMA	864,256		862,394		3,254		(5,116		)	—
Other	25,000		25,009		51		(42		)	—
Total U.S. government agencies	5,324,337		5,326,384		35,445		(33,398		)	—
Private issue:
Alt-A loans	35,853		46,695		10,842		—			—
Jumbo-A loans	44,944		53,299		8,355		—			—
Total private issue	80,797		99,994		19,197		—			—
Total residential mortgage-backed securities	5,405,134		5,426,378		54,642		(33,398		)	—
Commercial mortgage-backed securities guaranteed by U.S. government agencies	2,899,828		2,889,346		5,577		(16,059		)	—
Other debt securities	4,400		4,153		—		(247		)	—
Perpetual preferred stock	12,562		16,245		3,683		—			—
Equity securities and mutual funds	17,803		17,710		655		(748		)	—
Total available for sale securities	$	8,369,138	$	8,383,199	$	64,797	$	(50,736	)	$	—

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, 2016
	Amortized		Fair		Gross Unrealized¹
	Cost		Value		Gain		Loss			OTTI²
U.S. Treasury	$	1,000	$	999	$	—	$	(1	)	$	—
Municipal and other tax-exempt	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.



	September 30, 2016
	Amortized		Fair		Gross Unrealized¹
	Cost		Value		Gain		Loss			OTTI²
U.S. Treasury	$	1,000	$	1,002	$	2	$	—		$	—
Municipal and other tax-exempt	41,943		42,092		602		(453		)	—
Residential mortgage-backed securities:
U. S. government agencies:
FNMA	3,035,041		3,101,136		67,859		(1,764		)	—
FHLMC	1,611,887		1,641,178		29,640		(349		)	—
GNMA	924,176		926,358		3,530		(1,348		)	—
Total U.S. government agencies	5,571,104		5,668,672		101,029		(3,461		)	—
Private issue:
Alt-A loans	47,039		54,065		7,230		—			(204		)
Jumbo-A loans	61,377		67,538		6,187		(26		)	—
Total private issue	108,416		121,603		13,417		(26		)	(204		)
Total residential mortgage-backed securities	5,679,520		5,790,275		114,446		(3,487		)	(204		)
Commercial mortgage-backed securities guaranteed by U.S. government agencies	2,942,988		2,986,495		45,329		(1,822		)	—
Other debt securities	4,400		4,151		—		(249		)	—
Perpetual preferred stock	15,562		19,578		4,016		—			—
Equity securities and mutual funds	17,337		18,690		1,370		(17		)	—
Total available for sale securities	$	8,702,750	$	8,862,283	$	165,765	$	(6,028	)	$	(204	)


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 September 30, 2017, 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. Treasuries:
Amortized cost	$	1,000		$	—		$	—		$	—			$	1,000		0.29
Fair value	999			—			—			—				999
Nominal yield	0.87		%	—		%	—		%	—		%		0.87		%
Municipal and other tax-exempt:
Amortized cost	$	8,754		$	4,163		$	—		$	15,494			$	28,411		9.00
Fair value	8,780			4,313			—			15,275				28,368
Nominal yield¹	3.25		%	5.13		%	—		%	2.26		%	⁶	2.99		%
Commercial mortgage-backed securities:
Amortized cost	$	59,483		$	978,565		$	1,616,383		$	245,397			$	2,899,828		6.90
Fair value	59,402			976,466			1,610,642			242,836				2,889,346
Nominal yield	1.25		%	1.85		%	1.92		%	1.92		%		1.88		%
Other debt securities:
Amortized cost	$	—		$	—		$	—		$	4,400			$	4,400		29.91
Fair value	—			—			—			4,153				4,153
Nominal yield	—		%	—		%	—		%	1.71		%	⁶	1.71		%
Total fixed maturity securities:
Amortized cost	$	69,237		$	982,728		$	1,616,383		$	265,291			$	2,933,639		6.96
Fair value	69,181			980,779			1,610,642			262,264				2,922,866
Nominal yield	1.50		%	1.86		%	1.92		%	1.93		%		1.88		%
Residential mortgage-backed securities:
Amortized cost														$	5,405,134		²
Fair value														5,426,378
Nominal yield⁴														1.99		%
Equity securities and mutual funds:
Amortized cost														$	30,365		³
Fair value														33,955
Nominal yield														—		%
Total available-for-sale securities:
Amortized cost														$	8,369,138
Fair value														8,383,199
Nominal yield														1.95		%


¹	Calculated on a taxable equivalent basis using a 39 percent effective tax rate.


²	The average expected lives of mortgage-backed securities were 4.0 years 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):



	Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016
Proceeds	$	265,632		$	232,239		$	966,044		$	1,027,379
Gross realized gains	2,768			2,415			7,623			11,705
Gross realized losses	(281		)	(21		)	(2,707		)	(21		)
Related federal and state income tax expense	967			931			1,912			4,545

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):



	Sept. 30, 2017		Dec. 31, 2016		Sept. 30, 2016
Investment:
Amortized cost	$	237,525	$	322,208	$	301,754
Fair value	241,208		323,808		307,264

Available for sale:
Amortized cost	6,559,615		7,353,116		7,098,721
Fair value	6,551,240		7,327,470		7,213,520

The secured parties do not have the right to sell or repledge these securities.

At September 30, 2017, trading securities and receivables collateralized by securities with a fair value of $224 million were pledged as collateral at the Federal Home Loan Bank (FHLB) for the trading activities of BOK Financial Securities, Inc. No trading securities were pledged as collateral as of December 31, 2016 and no trading securities were pledged as collateral at September 30, 2016.

Temporarily Impaired Securities as of September 30, 2017

(in thousands):



	Number of Securities	Less Than 12 Months				12 Months or Longer				Total
	Number of Securities	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Investment:
Municipal and other tax-exempt	63	$	80,235	$	70	$	9,795	$	95	$	90,030	$	165
U.S. government agency residential mortgage-backed securities – Other	1	3,578		62		—		—		3,578		62
Other debt securities	28	10,022		566		427		24		10,449		590
Total investment securities	92	$	93,835	$	698	$	10,222	$	119	$	104,057	$	817



	Number of Securities	Less Than 12 Months				12 Months or Longer				Total
	Number of Securities	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Available for sale:
U.S. Treasury	1	$	999	$	1	$	—	$	—	$	999	$	1
Municipal and other tax-exempt	11	576		1		4,785		282		5,361		283
Residential mortgage-backed securities:
U. S. government agencies:
FNMA	81	1,054,171		10,288		480,994		10,269		1,535,165		20,557
FHLMC	42	477,823		3,546		198,478		4,137		676,301		7,683
GNMA	17	166,565		1,718		124,037		3,398		290,602		5,116
Other	1	19,958		42		—		—		19,958		42
Total U.S. government agencies	141	1,718,517		15,594		803,509		17,804		2,522,026		33,398
Private issue:
Alt-A loans	—	—		—		—		—		—		—
Jumbo-A loans	—	—		—		—		—		—		—
Total private issue	—	—		—		—		—		—		—
Total residential mortgage-backed securities	141	1,718,517		15,594		803,509		17,804		2,522,026		33,398
Commercial mortgage-backed securities guaranteed by U.S. government agencies	137	1,154,911		7,194		559,984		8,865		1,714,895		16,059
Other debt securities	2	—		—		4,153		247		4,153		247
Perpetual preferred stocks	—	—		—		—		—		—		—
Equity securities and mutual funds	91	3,672		696		1,428		52		5,100		748
Total available for sale securities	383	$	2,878,675	$	23,486	$	1,373,859	$	27,250	$	4,252,534	$	50,736

Temporarily Impaired Securities as of December 31, 2016

(In thousands)



	Number of Securities	Less Than 12 Months				12 Months or Longer				Total
	Number of Securities	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Investment:
Municipal and other tax-exempt	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
	Number of Securities	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Available for sale:
U.S. Treasury	1	$	999	$	1	$	—	$	—	$	999	$	1
Municipal and other tax-exempt	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. government 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 stocks	—	—		—		—		—		—		—
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 September 30, 2016

(In thousands)



	Number of Securities	Less Than 12 Months				12 Months or Longer				Total
	Number of Securities	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Investment:
Municipal and other tax-exempt	75	$	100,624	$	106	$	4,359	$	76	$	104,983	$	182
U.S. government agency residential mortgage-backed securities – Other	—	—		—		—		—		—		—
Other debt securities	3	444		6		856		4		1,300		10
Total investment securities	78	$	101,068	$	112	$	5,215	$	80	$	106,283	$	192



	Number of Securities	Less Than 12 Months				12 Months or Longer				Total
	Number of Securities	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Available for sale:
U.S. Treasury	—	$	—	$	—	$	—	$	—	$	—	$	—
Municipal and other tax-exempt¹	20	2,210		3		6,396		450		8,606		453
Residential mortgage-backed securities:
U. S. government agencies:
FNMA	14	365,201		1,712		14,229		52		379,430		1,764
FHLMC	6	122,713		91		20,306		258		143,019		349
GNMA	16	230,043		1,157		212,705		191		442,748		1,348
Total U.S. government agencies	36	717,957		2,960		247,240		501		965,197		3,461
Private issue¹:
Alt-A loans	5	8,231		141		7,773		63		16,004		204
Jumbo-A loans	1	6,583		26		—		—		6,583		26
Total private issue	6	14,814		167		7,773		63		22,587		230
Total residential mortgage-backed securities	42	732,771		3,127		255,013		564		987,784		3,691
Commercial mortgage-backed securities guaranteed by U.S. government agencies	33	372,805		1,656		60,851		166		433,656		1,822
Other debt securities	2	—		—		4,151		249		4,151		249
Perpetual preferred stocks	—	—		—		—		—		—		—
Equity securities and mutual funds	33	86		—		886		17		972		17
Total available for sale securities	130	$	1,107,872	$	4,786	$	327,297	$	1,446	$	1,435,169	$	6,232


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. This determination considers current and forecasted liquidity requirements, regulatory and capital requirements and securities portfolio management. Impaired equity securities, including perpetual preferred stocks, are evaluated based on the near-term prospects of the investment in relation to the severity and duration of the impairment and management's ability and intent to hold the securities until fair value recovers. Based on this evaluation as of September 30, 2017, the Company does not intend to sell any impaired available for sale securities before fair value recovers to the current amortized cost and it is more-likely-than-not that the Company will not be required to sell impaired securities before fair value recovers, which may be maturity.

Fair Value Option Securities

Fair value option securities represent securities which the Company has elected to carry at fair value and are separately identified on the Consolidated Balance Sheets. Changes in the fair value are recognized in earnings as they occur. Certain U.S. Treasury securities, 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):



	September 30, 2017				December 31, 2016					September 30, 2016
	Fair Value		Net Unrealized Gain (Loss)		Fair Value		Net Unrealized Gain (Loss)			Fair Value		Net Unrealized Gain (Loss)
U.S. Treasury	$	—	$	—	$	—	$	—		$	222,409	$	(2,397	)
U.S. government agency residential mortgage-backed securities	819,531		1,671		77,046		(1,777		)	—		—
Total	$	819,531	$	1,671	$	77,046	$	(1,777	)	$	222,409	$	(2,397	)

Restricted Equity Securities

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



	Sept. 30, 2017		Dec. 31, 2016		Sept. 30, 2016
Federal Reserve stock	$	36,676	$	36,498	$	36,283
Federal Home Loan Bank stock	310,622		270,541		296,907
Other	244		201		201
Total	$	347,542	$	307,240	$	333,391