Securities

3 Months Ended

Mar. 31, 2018

Marketable Securities [Abstract]

Securities [Text Block]

Securities

Trading Securities

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

	March 31, 2018					December 31, 2017					March 31, 2017
	Fair Value		Net Unrealized Gain (Loss)			Fair Value		Net Unrealized Gain (Loss)			Fair Value		Net Unrealized Gain (Loss)
U.S. government agency debentures	$	37,115	$	68		$	21,196	$	8		$	18,365	$	(74	)
U.S. government agency residential mortgage-backed securities	1,078,085		(2,692		)	392,673		(517		)	578,977		1,575
Municipal and other tax-exempt securities	72,013		—			13,559		83			45,114		171
Asset-backed securities	94,734		19			23,885		(26		)	—		—
Other trading securities	10,485		(58		)	11,363		4			34,700		36
Total trading securities	$	1,292,432	$	(2,663	)	$	462,676	$	(448	)	$	677,156	$	1,708

Investment Securities

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

	March 31, 2018
	Amortized		Fair		Gross Unrealized
	Cost		Value		Gain		Loss
Municipal and other tax-exempt	$	197,238	$	198,254	$	1,914	$	(898	)
U.S. government agency residential mortgage-backed securities – Other	14,967		15,112		319		(174		)
Other debt securities	204,467		215,495		13,029		(2,001		)
Total investment securities	$	416,672	$	428,861	$	15,262	$	(3,073	)

	December 31, 2017
	Amortized		Fair		Gross Unrealized
	Cost		Value		Gain		Loss
Municipal and other tax-exempt	$	228,186	$	230,349	$	2,967	$	(804	)
U.S. government agency residential mortgage-backed securities – Other	15,891		16,242		446		(95		)
Other debt securities	217,716		233,444		17,095		(1,367		)
Total investment securities	$	461,793	$	480,035	$	20,508	$	(2,266	)

	March 31, 2017
	Amortized		Fair		Gross Unrealized
	Cost		Value		Gain		Loss
Municipal and other tax-exempt	$	298,811	$	301,128	$	2,872	$	(555	)
U.S. government agency residential mortgage-backed securities – Other	19,378		19,967		669		(80		)
Other debt securities	201,213		219,568		19,172		(817		)
Total investment securities	$	519,402	$	540,663	$	22,713	$	(1,452	)

The amortized cost and fair values of investment securities at March 31, 2018, 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	$	82,916		$	63,604		$	14,879		$	35,839		$	197,238		3.77
Fair value	82,772			63,244			15,159			37,079			198,254
Nominal yield¹	2.02		%	2.62		%	5.23		%	5.65		%	3.11		%
Other debt securities:
Amortized cost	14,388			50,653			123,762			15,664			204,467			6.22
Fair value	14,585			52,890			133,634			14,386			215,495
Nominal yield	4.13		%	4.83		%	5.67		%	4.34		%	5.25		%
Total fixed maturity securities:
Amortized cost	$	97,304		$	114,257		$	138,641		$	51,503		$	401,705		5.02
Fair value	97,357			116,134			148,793			51,465			413,749
Nominal yield	2.33		%	3.60		%	5.62		%	5.25		%	4.20		%
Residential mortgage-backed securities:
Amortized cost													$	14,967		³
Fair value													15,112
Nominal yield4													2.76		%
Total investment securities:
Amortized cost													$	416,672
Fair value													428,861
Nominal yield													4.15		%

¹  Calculated on a taxable equivalent basis using a 25 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 4.9 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):

	March 31, 2018
	Amortized		Fair		Gross Unrealized
	Cost		Value		Gain		Loss			OTTI
U.S. Treasury	$	493	$	491	$	—	$	(2	)	$	—
Municipal and other tax-exempt	20,428		20,414		136		(150		)	—
Residential mortgage-backed securities:
U. S. government agencies:
FNMA	3,107,874		3,041,408		4,197		(70,663		)	—
FHLMC	1,567,520		1,532,582		1,390		(36,328		)	—
GNMA	817,800		805,931		1,265		(13,134		)	—
Total U.S. government agencies	5,493,194		5,379,921		6,852		(120,125		)	—
Private issue	70,434		90,160		19,726		—			—
Total residential mortgage-backed securities	5,563,628		5,470,081		26,578		(120,125		)	—
Commercial mortgage-backed securities guaranteed by U.S. government agencies	2,787,630		2,732,966		1,998		(56,662		)	—
Other debt securities	25,500		25,480		48		(68		)	—
Total available for sale securities	$	8,397,679	$	8,249,432	$	28,760	$	(177,007	)	$	—

	December 31, 2017
	Amortized		Fair		Gross Unrealized
	Cost		Value		Gain		Loss			OTTI
U.S. Treasury	$	1,000	$	1,000	$	—	$	—		$	—
Municipal and other tax-exempt	27,182		27,080		181		(283		)	—
Residential mortgage-backed securities:
U. S. government agencies:
FNMA	3,021,551		2,997,563		11,549		(35,537		)	—
FHLMC	1,545,971		1,531,009		3,148		(18,110		)	—
GNMA	787,626		780,580		1,607		(8,653		)	—
Total U.S. government agencies	5,355,148		5,309,152		16,304		(62,300		)	—
Private issue	74,311		93,221		19,301		—			(391		)
Total residential mortgage-backed securities	5,429,459		5,402,373		35,605		(62,300		)	(391		)
Commercial mortgage-backed securities guaranteed by U.S. government agencies	2,858,885		2,834,961		1,963		(25,887		)	—
Other debt securities	25,500		25,481		50		(69		)	—
Perpetual preferred stock	12,562		15,767		3,205		—			—
Equity securities and mutual funds	14,487		14,916		515		(86		)	—
Total available for sale securities	$	8,369,075	$	8,321,578	$	41,519	$	(88,625	)	$	(391	)

	March 31, 2017
	Amortized		Fair		Gross Unrealized
	Cost		Value		Gain		Loss			OTTI
U.S. Treasury	$	1,000	$	999	$	—	$	(1	)	$	—
Municipal and other tax-exempt	35,555		35,453		343		(445		)	—
Residential mortgage-backed securities:
U. S. government agencies:
FNMA	3,126,933		3,126,083		26,304		(27,154		)	—
FHLMC	1,401,752		1,399,011		7,836		(10,577		)	—
GNMA	851,498		847,822		2,499		(6,175		)	—
Total U.S. government agencies	5,380,183		5,372,916		36,639		(43,906		)	—
Private issue	93,372		108,626		15,332		(14		)	(64		)
Total residential mortgage-backed securities	5,473,555		5,481,542		51,971		(43,920		)	(64		)
Commercial mortgage-backed securities guaranteed by U.S. government agencies	2,895,258		2,877,028		4,883		(23,113		)	—
Other debt securities	4,400		4,153		—		(247		)	—
Perpetual preferred stock	15,562		19,272		3,710		—			—
Equity securities and mutual funds	17,498		18,844		1,433		(87		)	—
Total available for sale securities	$	8,442,828	$	8,437,291	$	62,340	$	(67,813	)	$	(64	)

The amortized cost and fair values of available for sale securities at March 31, 2018, 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 Maturity4
U.S. Treasuries:
Amortized cost	$	—		$	493		$	—		$	—			$	493		1.84
Fair value	—			491			—			—				491
Nominal yield	—		%	1.99		%	—		%	—		%		1.99		%
Municipal and other tax-exempt:
Amortized cost	$	5,687		$	2,282		$	—		$	12,459			$	20,428		10.02
Fair value	5,692			2,391			—			12,331				20,414
Nominal yield¹	3.18		%	6.27		%	—		%	2.84		%	5	3.32		%
Commercial mortgage-backed securities:
Amortized cost	$	18,207		$	1,021,173		$	1,502,536		$	245,714			$	2,787,630		6.97
Fair value	18,124			1,005,725			1,469,488			239,629				2,732,966
Nominal yield	1.58		%	1.93		%	2.06		%	2.08		%		2.01		%
Other debt securities:
Amortized cost	$	—		$	—		$	—		$	25,500			$	25,500		14.43
Fair value	—			—			—			25,480				25,480
Nominal yield	—		%	—		%	—		%	1.59		%	5	1.59		%
Total fixed maturity securities:
Amortized cost	$	23,894		$	1,023,948		$	1,502,536		$	283,672			$	2,834,051		7.06
Fair value	23,816			1,008,607			1,469,488			277,440				2,779,351
Nominal yield	1.96		%	1.94		%	2.06		%	2.07		%		2.02		%
Residential mortgage-backed securities:
Amortized cost														$	5,563,628		2
Fair value														5,470,081
Nominal yield3														2.00		%
Total available-for-sale securities:
Amortized cost														$	8,397,679
Fair value														8,249,432
Nominal yield														2.01		%

¹  Calculated on a taxable equivalent basis using a 25 percent effective tax rate.

²  The average expected lives of mortgage-backed securities were 4.3 years years based upon current prepayment assumptions.

³  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.

⁴  Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without penalty.

⁵  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 March 31,
	2018			2017
Proceeds	$	44,790		$	240,010
Gross realized gains	193			2,092
Gross realized losses	(483		)	(43		)
Related federal and state income tax expense	74			797

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):

	Mar. 31, 2018		Dec. 31, 2017		Mar. 31, 2017
Investment:
Amortized cost	$	196,566	$	226,852	$	290,417
Fair value	197,845		229,429		293,352
Available for sale:
Amortized cost	8,289,623		7,151,468		6,647,659
Fair value	8,124,367		7,089,346		6,629,319

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

Temporarily Impaired Securities as of March 31, 2018

(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	96	$	121,251	$	699	$	5,014	$	199	$	126,265	$	898
U.S. government agency residential mortgage-backed securities – Other	2	3,578		47		3,082		127		6,660		174
Other debt securities	78	34,042		1,803		3,321		198		37,363		2,001
Total investment securities	176	$	158,871	$	2,549	$	11,417	$	524	$	170,288	$	3,073

	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	1	$	491	$	2	$	—	$	—	$	491	$	2
Municipal and other tax-exempt	13	12,935		8		1,891		142		14,826		150
Residential mortgage-backed securities:
U. S. government agencies:
FNMA	156	1,815,606		35,077		755,589		35,586		2,571,195		70,663
FHLMC	82	998,792		21,502		361,326		14,826		1,360,118		36,328
GNMA	32	252,190		3,986		235,156		9,148		487,346		13,134
Total U.S. government agencies	270	3,066,588		60,565		1,352,071		59,560		4,418,659		120,125
Private issue	—	—		—		—		—		—		—
Total residential mortgage-backed securities	270	3,066,588		60,565		1,352,071		59,560		4,418,659		120,125
Commercial mortgage-backed securities guaranteed by U.S. government agencies	216	1,658,562		36,141		582,971		20,521		2,241,533		56,662
Other debt securities	2	19,961		40		472		28		20,433		68
Total available for sale securities	502	$	4,758,537	$	96,756	$	1,937,405	$	80,251	$	6,695,942	$	177,007

Temporarily Impaired Securities as of December 31, 2017

(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	100	$	145,960	$	643	$	5,833	$	161	$	151,793	$	804
U.S. government agency residential mortgage-backed securities – Other	1	—		—		3,356		95		3,356		95
Other debt securities	49	20,091		1,238		3,076		129		23,167		1,367
Total investment securities	150	$	166,051	$	1,881	$	12,265	$	385	$	178,316	$	2,266

	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	—	$	—	$	—	$	—	$	—	$	—	$	—
Municipal and other tax-exempt	19	12,765		18		4,802		265		17,567		283
Residential mortgage-backed securities:
U. S. government agencies:
FNMA	113	1,203,041		9,618		824,029		25,919		2,027,070		35,537
FHLMC	69	863,778		7,297		385,816		10,813		1,249,594		18,110
GNMA	27	201,887		1,452		248,742		7,201		450,629		8,653
Total U.S. government agencies	209	2,268,706		18,367		1,458,587		43,933		3,727,293		62,300
Private issue1	8	5,898		391		—		—		5,898		391
Total residential mortgage-backed securities	217	2,274,604		18,758		1,458,587		43,933		3,733,191		62,691
Commercial mortgage-backed securities guaranteed by U.S. government agencies	185	1,465,703		11,824		652,296		14,063		2,117,999		25,887
Other debt securities	2	19,959		41		472		28		20,431		69
Perpetual preferred stocks	—	—		—		—		—		—		—
Equity securities and mutual funds	111	911		7		2,203		79		3,114		86
Total available for sale securities	534	$	3,773,942	$	30,648	$	2,118,360	$	58,368	$	5,892,302	$	89,016

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 March 31, 2017

(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	102	$	127,374	$	515	$	1,563	$	40	$	128,937	$	555
U.S. government agency residential mortgage-backed securities – Other	1	4,055		80		—		—		4,055		80
Other debt securities	43	14,440		817		—		—		14,440		817
Total investment securities	146	$	145,869	$	1,412	$	1,563	$	40	$	147,432	$	1,452

	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	1	$	999	$	1	$	—	$	—	$	999	$	1
Municipal and other tax-exempt	12	1,407		1		4,623		444		6,030		445
Residential mortgage-backed securities:
U. S. government agencies:
FNMA	83	1,595,879		25,623		68,215		1,531		1,664,094		27,154
FHLMC	51	795,586		10,001		17,284		576		812,870		10,577
GNMA	25	325,565		4,402		69,563		1,773		395,128		6,175
Total U.S. government agencies	159	2,717,030		40,026		155,062		3,880		2,872,092		43,906
Private issue1	6	6,805		37		13,461		41		20,266		78
Total residential mortgage-backed securities	165	2,723,835		40,063		168,523		3,921		2,892,358		43,984
Commercial mortgage-backed securities guaranteed by U.S. government agencies	161	1,828,685		22,758		36,305		355		1,864,990		23,113
Other debt securities	2	—		—		4,153		247		4,153		247
Perpetual preferred stocks	—	—		—		—		—		—		—
Equity securities and mutual funds	104	2,116		40		856		47		2,972		87
Total available for sale securities	445	$	4,557,042	$	62,863	$	214,460	$	5,014	$	4,771,502	$	67,877

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

Based on evaluations of impaired securities as of March 31, 2018, the Company does not intend to sell any impaired available for sale debt 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 securities 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):

	March 31, 2018			December 31, 2017			March 31, 2017
	Fair Value	Net Unrealized Gain (Loss)		Fair Value	Net Unrealized Gain (Loss)		Fair Value	Net Unrealized Gain (Loss)
U.S. government agency residential mortgage-backed securities	513,668	(5,269	)	755,054	(1,877	)	441,714	(1,646	)

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):

	Mar. 31, 2018		Dec. 31, 2017		Mar. 31, 2017
Federal Reserve stock	$	41,178	$	40,746	$	36,498
Federal Home Loan Bank stock	297,374		279,200		247,194
Other	—		243		244
Total	$	338,552	$	320,189	$	283,936