Note 3 - Investment Securities

9 Months Ended

Sep. 30, 2014

Investments, Debt and Equity Securities [Abstract]

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

NOTE 3:  INVESTMENT SECURITIES

The amortized cost and fair value of investment securities that are classified as held-to-maturity and available-for-sale are as follows:

	September 30, 2014									December 31, 2013
(In thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Estimated Fair Value		Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Estimated Fair Value
Held-to-Maturity
U.S. Government agencies	$	455,827	$	961	$	(5,403	)	$	451,385	$	395,198	$	50	$	(10,535	)	$	384,713
Mortgage-backed securities		30,954		9		(602	)		30,361		34,425		17		(442	)		34,000
State and political subdivisions		335,329		8,762		(872	)		341,080		315,445		2,165		(5,498	)		312,112
Other securities		620		-		-			620		620		-		-			620
Total HTM	$	822,730	$	9,732	$	(6,877	)	$	823,446	$	745,688	$	2,232	$	(16,475	)	$	731,445
Available-for-Sale
U.S. Treasury	$	4,000	$	-	$	(10	)	$	3,991	$	4,001	$	-	$	(16	)	$	3,985
U.S. Government agencies		283,620		17		(3,316	)		280,321		183,781		8		(5,572	)		178,217
Mortgage-backed securities		52		1		(21	)		32		1,735		156		-			1,891
State and political subdivisions		8,892		12		(2	)		8,903		7,860		4		(3	)		7,861
Other securities		23,839		395		(9	)		24,226		19,840		484		(1	)		20,323
Total AFS	$	320,405	$	425	$	(3,358	)	$	317,473	$	217,217	$	652	$	(5,592	)	$	212,277

Certain investment securities are valued at less than their historical cost.  These declines primarily resulted from the rate for these investments yielding less than current market rates.  Based on evaluation of available evidence, management believes the declines in fair value for these securities are temporary.  Management does not have the intent to sell these securities and management believes it is more likely than not the Company will not have to sell these securities before recovery of their amortized cost basis less any current period credit losses.  Should the impairment of any of these securities become other than temporary, the cost basis of the investment will be reduced and the resulting loss recognized in net income in the period the other-than-temporary impairment is identified.

As of September 30, 2014, securities with unrealized losses, segregated by length of impairment, were as follows:

	Less Than 12 Months					12 Months or More					Total
(In thousands)	Estimated Fair Value		Gross Unrealized Losses			Estimated Fair Value		Gross Unrealized Losses			Estimated Fair Value		Gross Unrealized Losses
Held-to-Maturity
U.S. Government agencies	$	316,956	$	(4,059	)	$	72,610	$	(1,343	)	$	389,566	$	(5,403	)
Mortgage-backed securities		27,239		(602	)		-		-			27,239		(602	)
State and political subdivisions		42,626		(425	)		24,636		(447	)		67,263		(872	)
Total HTM	$	386,821	$	(5,086	)	$	97,246	$	(1,790	)	$	484,068	$	(6,877	)
Available-for-Sale
U.S. Treasury	$	3,991	$	(10	)	$	-	$	-		$	3,991	$	(10	)
U.S. Government agencies		211,696		(2,092	)		59,080		(1,224	)		270,776		(3,316	)
Mortgage-backed securities		1,570		(21	)		-		-			1,570		(21	)
State and political subdivisions		699		(2	)		-		-			699		(2	)
Other securities		1,681		(9	)		-		-			1,681		(9	)
Total AFS	$	219,637	$	(2,134	)	$	59,080	$	(1,224	)	$	278,717	$	(3,358	)

Declines in the fair value of held-to-maturity and available-for-sale securities below their cost that are deemed to be other than temporary are reflected in earnings as realized losses.  In estimating other-than-temporary impairment losses, management considers, among other things, (i) the length of time and the extent to which the fair value has been less than cost, (ii) the financial condition and near-term prospects of the issuer, and (iii) the intent and ability of the Company to retain its investment in the issuer for a period of time sufficient to allow for any anticipated recovery in fair value.

Management has the ability and intent to hold the securities classified as held to maturity until they mature, at which time the Company expects to receive full value for the securities.  Furthermore, as of September 30, 2014, management also had the ability and intent to hold the securities classified as available-for-sale for a period of time sufficient for a recovery of cost.  The unrealized losses are largely due to increases in market interest rates over the yields available at the time the underlying securities were purchased.  The fair value is expected to recover as the bonds approach their maturity date or repricing date or if market yields for such investments decline.  Management does not believe any of the securities are impaired due to reasons of credit quality.  Accordingly, as of September 30, 2014, management believes the impairments detailed in the table above are temporary.

The carrying value, which approximates the fair value, of securities pledged as collateral, to secure public deposits and for other purposes, amounted to $532.9 million at September 30, 2014, and $587.9 million at December 31, 2013.

The book value of securities sold under agreements to repurchase equaled $86.2 million and $102.8 million for September 30, 2014, and December 31, 2013, respectively.

Income earned on securities for the three and nine months ended September 30, 2014 and 2013, is as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2014		2013		2014		2013
Taxable:
Held-to-maturity	$	1,440	$	818	$	4,167	$	2,281
Available-for-sale		603		540		1,882		1,605
Non-taxable:
Held-to-maturity		2,647		2,066		7,900		5,450
Available-for-sale		27		4		83		13
Total	$	4,717	$	3,428	$	14,032	$	9,349

Maturities of investment securities at September 30, 2014, are as follows:

	Held-to-Maturity				Available-for-Sale
(In thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
One year or less	$	19,171	$	19,201	$	4,972	$	4,981
After one through five years		378,700		376,377		179,804		179,154
After five through ten years		214,805		213,800		25,236		24,813
After ten years		210,054		214,068		87,891		85,630
Other securities		-		-		22,502		22,895
Total	$	822,730	$	823,446	$	320,405	$	317,473

There were $153,000 of realized gains and $171,000 of realized losses on investment securities for the three months ended September 30, 2014.  There were $191,000 of realized gains and $171,000 of realized losses for the nine months ended September 30, 2014.  There were no realized gains and losses on investment securities for the three months ended September 30, 2013.  There were no realized gains and realized losses of $193,000 for the nine months ended September 30, 2013.

The state and political subdivision debt obligations are primarily non-rated bonds and represent small, Arkansas and Texas issues, which are evaluated on an ongoing basis.