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Note 4 - Securities

9 Months Ended

Sep. 30, 2019

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

4. Securities

The Company did not hold any trading securities at September 30, 2019 and December 31, 2018. Securities available for sale are recorded at fair value. Securities held-to-maturity are recorded at amortized cost.

The following table summarizes the Company’s portfolio of securities held-to-maturity at September 30, 2019:

					Gross		Gross
	Amortized				Unrealized		Unrealized
	Cost		Fair Value		Gains		Losses
	(In thousands)
Securities held-to-maturity:
Municipals	$	52,101	$	55,498	$	3,397	$	-

Total other securities		52,101		55,498		3,397		-

FNMA		7,939		8,372		433		-

Total mortgage-backed securities		7,939		8,372		433		-
Total	$	60,040	$	63,870	$	3,830	$	-

The following table summarizes the Company’s portfolio of securities held-to-maturity at December 31, 2018:

					Gross		Gross
	Amortized				Unrealized		Unrealized
	Cost		Fair Value		Gains		Losses
	(In thousands)
Securities held-to-maturity:
Municipals	$	24,065	$	22,508	$	-	$	1,557

Total other securities		24,065		22,508		-		1,557

FNMA		7,953		7,366		-		587

Total mortgage-backed securities		7,953		7,366		-		587

Total	$	32,018	$	29,874	$	-	$	2,144

The following table summarizes the Company’s portfolio of securities available for sale at September 30, 2019:

					Gross		Gross
	Amortized				Unrealized		Unrealized
	Cost		Fair Value		Gains		Losses
	(In thousands)
Corporate	$	130,000	$	120,543	$	-	$	9,457
Municipals		12,849		13,017		168		-
Mutual funds		12,206		12,206		-		-
Collateralized loan obligations		100,336		99,381		5		960
Other		1,318		1,318		-		-
Total other securities		256,709		246,465		173		10,417
REMIC and CMO		390,044		392,525		3,604		1,123
GNMA		706		764		58		-
FNMA		106,773		107,383		998		388
FHLMC		77,455		78,338		998		115
Total mortgage-backed securities		574,978		579,010		5,658		1,626
Total securities available for sale	$	831,687	$	825,475	$	5,831	$	12,043

The following table summarizes the Company’s portfolio of securities available for sale at December 31, 2018:

					Gross		Gross
	Amortized				Unrealized		Unrealized
	Cost		Fair Value		Gains		Losses
	(In thousands)
Corporate	$	130,000	$	118,535	$	-	$	11,465
Municipals		46,231		46,574		343		-
Mutual funds		11,586		11,586		-		-
Collateralized loan obligations		88,396		86,751		-		1,645
Other		1,256		1,256		-		-
Total other securities		277,469		264,702		343		13,110
REMIC and CMO		382,632		376,340		885		7,177
GNMA		785		826		41		-
FNMA		94,069		91,693		72		2,448
FHLMC		90,377		89,094		113		1,396
Total mortgage-backed securities		567,863		557,953		1,111		11,021
Total securities available for sale	$	845,332	$	822,655	$	1,454	$	24,131

We did not hold any private issue CMO’s that are collateralized by commercial real estate mortgages at September 30, 2019 and December 31, 2018.

The corporate securities held by the Company at September 30, 2019 and December 31, 2018 are issued by U.S. banking institutions.

The following tables detail the amortized cost and fair value of the Company’s securities classified as held-to-maturity and available for sale at September 30, 2019, by contractual maturity. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

	Amortized
Securities held-to-maturity:	Cost		Fair Value
	(In thousands)

Due in one year or less	$	1,180	$	1,180
Due after ten years		50,921		54,318

Total other securities		52,101		55,498
Mortgage-backed securities		7,939		8,372

Total	$	60,040	$	63,870

	Amortized
Securities available for sale:	Cost		Fair Value
	(In thousands)

Due after one year through five years	$	10,000	$	9,762
Due after five years through ten years		137,913		128,645
Due after ten years		96,590		95,852

Total other securities		244,503		234,259
Mutual funds		12,206		12,206
Mortgage-backed securities		574,978		579,010

Total	$	831,687	$	825,475

The following tables show the Company’s securities with gross unrealized losses and their fair value, aggregated by category and length of time that individual securities have been in a continuous unrealized loss position, at the dates indicated:

	At September 30, 2019
	Total						Less than 12 months				12 months or more
					Unrealized				Unrealized				Unrealized
	Count		Fair Value		Losses		Fair Value		Losses		Fair Value		Losses
			(Dollars in thousands)


Available for sale securities
Corporate		16	$	120,543	$	9,457	$	9,663	$	338	$	110,880	$	9,119
CLO		12		91,916		960		63,821		485		28,095		475
Total other securities		28		212,459		10,417		73,484		823		138,975		9,594

REMIC and CMO		25		157,584		1,123		138,250		887		19,334		236
FNMA		7		69,075		388		14,888		30		54,187		358
FHLMC		1		34,816		115		-		-		34,816		115
Total mortgage-backed securities		33		261,475		1,626		153,138		917		108,337		709
Total		61	$	473,934	$	12,043	$	226,622	$	1,740	$	247,312	$	10,303

There were no unrealized losses on held-to maturity securities at September 30, 2019.

	At December 31, 2018
	Total						Less than 12 months				12 months or more
					Unrealized				Unrealized				Unrealized
	Count		Fair Value		Losses		Fair Value		Losses		Fair Value		Losses
	(Dollars in thousands)
Held-to-maturity securities

Municipals		1	$	19,940	$	1,557	$	-	$	-	$	19,940	$	1,557
Total other securities		1		19,940		1,557		-		-		19,940		1,557

FNMA		1		7,366		587		-		-		7,366		587
Total mortgage-backed securities		1		7,366		587		-		-		7,366		587

Total securities held-to-maturity		2	$	27,306	$	2,144	$	-	$	-	$	27,306	$	2,144

Available for sale securities
Corporate		16	$	118,535	$	11,465	$	19,113	$	888	$	99,422	$	10,577
Municipals		3		4,220		-		4,220		-		-		-
CLO		11		86,752		1,645		86,752		1,645		-		-
Total other securities		30		209,507		13,110		110,085		2,533		99,422		10,577

REMIC and CMO		39		243,756		7,177		17,308		200		226,448		6,977
GNMA		1		51		-		51		-		-		-
FNMA		14		85,046		2,448		6,372		17		78,674		2,431
FHLMC		3		51,288		1,396		10,116		95		41,172		1,301
Total mortgage-backed securities		57		380,141		11,021		33,847		312		346,294		10,709
Total securities available for sale		87	$	589,648	$	24,131	$	143,932	$	2,845	$	445,716	$	21,286

OTTI losses on impaired securities must be fully recognized in earnings if an investor has the intent to sell the debt security or if it is more likely than not that the investor will be required to sell the debt security before recovery of its amortized cost. However, even if an investor does not expect to sell a debt security in an unrealized loss position, the investor must evaluate the expected cash flows to be received and determine if a credit loss has occurred. In the event that a credit loss has occurred, only the amount of impairment associated with the credit loss is recognized in earnings in the Consolidated Statements of Income. Amounts relating to factors other than credit losses are recorded in accumulated other comprehensive loss (“AOCL”) within Stockholders’ Equity. Unrealized losses on available for sale securities, that are deemed to be temporary, are recorded in AOCL, net of tax.

The Company reviewed each investment that had an unrealized loss at September 30, 2019 and December 31, 2018. The unrealized losses in held-to-maturity municipal securities at December 31, 2018 were caused by illiquidity in the market and movements in interest rates. The unrealized losses in held-to-maturity FNMA securities at December 31, 2018 were caused by movements in interest rates. The unrealized losses in securities available for sale at September 30, 2019 and December 31, 2018 were caused by movements in interest rates.

It is not anticipated that these securities would be settled at a price that is less than the amortized cost of the Company’s investment. Each of these securities is performing according to its terms and, in the opinion of management, will continue to perform according to its terms. The Company does not have the intent to sell these securities and it is more likely than not the Company will not be required to sell the securities before recovery of the securities’ amortized cost basis. This conclusion is based upon considering the Company’s cash and working capital requirements and contractual and regulatory obligations, none of which the Company believes would cause the sale of the securities. Therefore, the Company did not consider these investments to be other-than-temporarily impaired at September 30, 2019 and December 31, 2018.

Realized gains and losses on the sales of securities are determined using the specific identification method. The Company sold $26.4 million in mortgage-backed securities during the nine months ended September 30, 2019. The Company did not sell any securities during the three months ended September 30, 2019 and the three and nine months ended September 30, 2018.

The following table represents the gross gains and gross losses realized from the sale of securities available for sale for the periods indicated:

	For the three months ended				For the nine months ended
	September 30,				September 30,
	2019		2018		2019			2018
	(In thousands)
Gross gains from the sale of securities	$	-	$	-	$	423		$	-
Gross losses from the sale of securities		-		-		(438	)		-

Net losses from the sale of securities	$	-	$	-	$	(15	)	$	-