| INTEREST-BEARING DEPOSITS AND SECURITIES |
INTEREST-BEARING DEPOSITS AND SECURITIES
The following table sets forth additional detail regarding our interest-bearing deposits and securities at the dates indicated (includes securities—trading, available-for-sale and held-to-maturity, all at carrying value) (in thousands): | | | | | | | | | | | | | | March 31
2014 |
| | December 31
2013 |
| | March 31
2013 |
| Interest-bearing deposits included in cash and due from banks | $ | 71,459 |
| | $ | 67,638 |
| | $ | 96,300 |
| U.S. Government and agency obligations | 61,438 |
| | 61,327 |
| | 79,959 |
| Municipal bonds: |
|
| |
|
| |
|
| Taxable | 30,372 |
| | 34,216 |
| | 43,921 |
| Tax exempt | 124,692 |
| | 119,588 |
| | 110,062 |
| Total municipal bonds | 155,064 |
| | 153,804 |
| | 153,983 |
| Corporate bonds | 42,097 |
| | 44,154 |
| | 47,233 |
| Mortgage-backed or related securities: |
|
| |
|
| |
|
| One- to four-family residential agency guaranteed | 57,263 |
| | 58,117 |
| | 89,036 |
| One- to four-family residential other | 1,003 |
| | 1,051 |
| | 1,282 |
| Multifamily agency guaranteed | 279,912 |
| | 281,319 |
| | 200,012 |
| Multifamily other | 10,415 |
| | 10,234 |
| | 10,787 |
| Total mortgage-backed or related securities | 348,593 |
| | 350,721 |
| | 301,117 |
| Asset-backed securities: |
|
| |
|
| |
|
| Student Loan Marketing Association (SLMA) | 15,749 |
| | 15,681 |
| | 32,239 |
| Other asset-backed securities | 9,608 |
| | 9,510 |
| | 18,261 |
| Total asset-backed securities | 25,357 |
| | 25,191 |
| | 50,500 |
| Equity securities (excludes FHLB stock) | 62 |
| | 68 |
| | 60 |
| Total securities | 632,611 |
| | 635,265 |
| | 632,852 |
| FHLB stock (see Note 6) | 33,288 |
| | 35,390 |
| | 36,373 |
| | $ | 737,358 |
| | $ | 738,293 |
| | $ | 765,525 |
|
Securities—Trading: The amortized cost and estimated fair value of securities—trading at March 31, 2014 and December 31, 2013 are summarized as follows (dollars in thousands): | | | | | | | | | | | | | | | | | | | | | | | | March 31, 2014 | | December 31, 2013 | | Amortized Cost | | Fair Value | | Percent of Total | | Amortized Cost | | Fair Value | | Percent of Total | U.S. Government and agency obligations | $ | 1,370 |
| | $ | 1,511 |
| | 2.6 | % | | $ | 1,370 |
| | $ | 1,481 |
| | 2.4 | % | Municipal bonds: |
|
| |
|
| | | | | | | | | Tax exempt | 1,666 |
| | 1,719 |
| | 2.9 |
| | 4,969 |
| | 5,023 |
| | 8.0 |
| Corporate bonds | 49,464 |
| | 35,062 |
| | 60.1 |
| | 49,498 |
| | 35,140 |
| | 56.2 |
| Mortgage-backed or related securities: |
|
| |
|
| | | | | | | | | One- to four-family residential agency guaranteed | 9,822 |
| | 10,545 |
| | 18.1 |
| | 10,483 |
| | 11,230 |
| | 18.0 |
| Multifamily agency guaranteed | 8,774 |
| | 9,488 |
| | 16.2 |
| | 8,816 |
| | 9,530 |
| | 15.3 |
| Total mortgage-backed or related securities | 18,596 |
| | 20,033 |
| | 34.3 |
| | 19,299 |
| | 20,760 |
| | 33.3 |
| Equity securities | 14 |
| | 62 |
| | 0.1 |
| | 14 |
| | 68 |
| | 0.1 |
| | $ | 71,110 |
| | $ | 58,387 |
| | 100.0 | % | | $ | 75,150 |
| | $ | 62,472 |
| | 100.0 | % |
There were three sales of securities—trading totaling $2.4 million with a resulting net gain of $1,000 during the three months ended March 31, 2014. There were 21 sales of securities—trading totaling $6.1 million with a resulting net gain of $1.1 million during the three months ended March 31, 2013, including $1.0 million which represented recoveries on certain collateralized debt obligations that had previously been written off. In addition to the $1.1 million net gain, the Company also recognized a $409,000 OTTI recovery on sales of securities—trading during the three months ended March 31, 2013, which was related to the sale of certain equity securities issued by government-sponsored entities. The Company recognized no OTTI charges or recoveries on securities—trading during the three months ended March 31, 2014. There were no securities—trading on nonaccrual status at March 31, 2014 and 2013.
The amortized cost and estimated fair value of securities—trading at March 31, 2014 and December 31, 2013, by contractual maturity, are shown below (in thousands). Expected maturities will differ from contractual maturities because some securities may be called or prepaid with or without call or prepayment penalties. | | | | | | | | | | | | | | | | | | March 31, 2014 | | December 31, 2013 | | Amortized Cost | | Fair Value | | Amortized Cost | | Fair Value | Maturing in one year or less | $ | 260 |
| | $ | 261 |
| | $ | 260 |
| | $ | 263 |
| Maturing after one year through five years | 5,803 |
| | 6,147 |
| | 7,056 |
| | 7,298 |
| Maturing after five years through ten years | 10,181 |
| | 11,063 |
| | 12,602 |
| | 13,572 |
| Maturing after ten years through twenty years | 33,005 |
| | 26,608 |
| | 33,335 |
| | 27,472 |
| Maturing after twenty years | 21,847 |
| | 14,246 |
| | 21,883 |
| | 13,799 |
| | 71,096 |
| | 58,325 |
| | 75,136 |
| | 62,404 |
| Equity securities | 14 |
| | 62 |
| | 14 |
| | 68 |
| | $ | 71,110 |
| | $ | 58,387 |
| | $ | 75,150 |
| | $ | 62,472 |
|
Securities—Available-for-Sale: The amortized cost and estimated fair value of securities—available-for-sale at March 31, 2014 and December 31, 2013 are summarized as follows (dollars in thousands): | | | | | | | | | | | | | | | | | | | | | March 31, 2014 | | Amortized Cost | | Gross Unrealized Gains | | Gross Unrealized Losses | | Fair Value | | Percent of Total | U.S. Government and agency obligations | $ | 59,139 |
| | $ | 83 |
| | $ | (471 | ) | | $ | 58,751 |
| | 12.6 | % | Municipal bonds: |
|
| |
|
| |
|
| |
|
| | | Taxable | 19,774 |
| | 125 |
| | (78 | ) | | 19,821 |
| | 4.2 |
| Tax exempt | 30,505 |
| | 173 |
| | (165 | ) | | 30,513 |
| | 6.6 |
| Total municipal bonds | 50,279 |
| | 298 |
| | (243 | ) | | 50,334 |
| | 10.8 |
| Corporate bonds | 5,000 |
| | — |
| | (15 | ) | | 4,985 |
| | 1.1 |
| Mortgage-backed or related securities: |
|
| |
|
| |
|
| |
|
| | | One- to four-family residential agency guaranteed | 46,234 |
| | 971 |
| | (487 | ) | | 46,718 |
| | 10.1 |
| One- to four-family residential other | 945 |
| | 58 |
| | — |
| | 1,003 |
| | 0.2 |
| Multifamily agency guaranteed | 269,103 |
| | 457 |
| | (2,466 | ) | | 267,094 |
| | 57.5 |
| Multifamily other | 10,580 |
| | — |
| | (165 | ) | | 10,415 |
| | 2.2 |
| Total mortgage-backed or related securities | 326,862 |
| | 1,486 |
| | (3,118 | ) | | 325,230 |
| | 70.0 |
| Asset-backed securities: |
|
| |
|
| |
|
| |
|
| | | SLMA | 15,528 |
| | 221 |
| | — |
| | 15,749 |
| | 3.4 |
| Other asset-backed securities | 10,058 |
| | — |
| | (450 | ) | | 9,608 |
| | 2.1 |
| Total asset-backed securities | 25,586 |
| | 221 |
| | (450 | ) | | 25,357 |
| | 5.5 |
| | $ | 466,866 |
| | $ | 2,088 |
| | $ | (4,297 | ) | | $ | 464,657 |
| | 100.0 | % | | | | | | | | | | | | December 31, 2013 | | Amortized Cost | | Gross Unrealized Gains | | Gross Unrealized Losses | | Fair Value | | Percent of Total | U.S. Government and agency obligations | $ | 59,178 |
| | $ | 117 |
| | $ | (635 | ) | | $ | 58,660 |
| | 12.5 | % | Municipal bonds: | | | | | | | | | | Taxable | 23,842 |
| | 100 |
| | (278 | ) | | 23,664 |
| | 5.0 |
| Tax exempt | 29,229 |
| | 170 |
| | (208 | ) | | 29,191 |
| | 6.2 |
| Total municipal bonds | 53,071 |
| | 270 |
| | (486 | ) | | 52,855 |
| | 11.2 |
| Corporate bonds | 7,001 |
| | 2 |
| | (39 | ) | | 6,964 |
| | 1.5 |
| Mortgage-backed or related securities: | | | | | | | | | | One- to four-family residential agency guaranteed | 47,077 |
| | 648 |
| | (838 | ) | | 46,887 |
| | 10.0 |
| One- to four-family residential other | 988 |
| | 63 |
| | — |
| | 1,051 |
| | 0.2 |
| Multifamily agency guaranteed | 271,428 |
| | 402 |
| | (3,392 | ) | | 268,438 |
| | 57.1 |
| Multifamily other | 10,604 |
| | — |
| | (370 | ) | | 10,234 |
| | 2.2 |
| Total mortgage-backed or related securities | 330,097 |
| | 1,113 |
| | (4,600 | ) | | 326,610 |
| | 69.5 |
| Asset-backed securities: | | | | | | | | | | SLMA | 15,553 |
| | 128 |
| | — |
| | 15,681 |
| | 3.3 |
| Other asset-backed securities | 10,060 |
| | — |
| | (550 | ) | | 9,510 |
| | 2.0 |
| Total asset-backed securities | 25,613 |
| | 128 |
| | (550 | ) | | 25,191 |
| | 5.3 |
| | $ | 474,960 |
| | $ | 1,630 |
| | $ | (6,310 | ) | | $ | 470,280 |
| | 100.0 | % |
At March 31, 2014 and December 31, 2013, an aging of unrealized losses and fair value of related securities—available-for-sale was as follows (in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | | March 31, 2014 | | Less Than 12 Months | | 12 Months or More | | Total | | Fair Value | | Unrealized Losses | | Fair Value | | Unrealized Losses | | Fair Value | | Unrealized Losses | U.S. Government and agency obligations | $ | 29,777 |
| | $ | (471 | ) | | $ | — |
| | $ | — |
| | $ | 29,777 |
| | $ | (471 | ) | Municipal bonds: |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| Taxable | 7,413 |
| | (73 | ) | | 425 |
| | (5 | ) | | 7,838 |
| | (78 | ) | Tax exempt | 8,863 |
| | (58 | ) | | 1,626 |
| | (107 | ) | | 10,489 |
| | (165 | ) | Total municipal bonds | 16,276 |
| | (131 | ) | | 2,051 |
| | (112 | ) | | 18,327 |
| | (243 | ) | Corporate bonds | 4,986 |
| | (15 | ) | | — |
| | — |
| | 4,986 |
| | (15 | ) | Mortgage-backed or related securities: |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| One- to four-family residential agency guaranteed | 3,514 |
| | (44 | ) | | 12,297 |
| | (443 | ) | | 15,811 |
| | (487 | ) | Multifamily agency guaranteed | 170,998 |
| | (2,143 | ) | | 23,891 |
| | (323 | ) | | 194,889 |
| | (2,466 | ) | Multifamily other | 10,415 |
| | (165 | ) | | — |
| | — |
| | 10,415 |
| | (165 | ) | Total mortgage-backed or related securities | 184,927 |
| | (2,352 | ) | | 36,188 |
| | (766 | ) | | 221,115 |
| | (3,118 | ) | Asset-backed securities: |
|
| |
|
| |
|
| |
|
| |
|
| | | Other asset-backed securities | — |
| | — |
| | 9,608 |
| | (450 | ) | | 9,608 |
| | (450 | ) | | $ | 235,966 |
| | $ | (2,969 | ) | | $ | 47,847 |
| | $ | (1,328 | ) | | $ | 283,813 |
| | $ | (4,297 | ) | | | | | | | | | | | | | | December 31, 2013 | | Less Than 12 Months | | 12 Months or More | | Total | | Fair Value | | Unrealized Losses | | Fair Value | | Unrealized Losses | | Fair Value | | Unrealized Losses | U.S. Government and agency obligations | $ | 39,621 |
| | $ | (633 | ) | | $ | 998 |
| | $ | (2 | ) | | $ | 40,619 |
| | $ | (635 | ) | Municipal bonds: | | | | | | | | | | | | Taxable | 15,580 |
| | (261 | ) | | 413 |
| | (17 | ) | | 15,993 |
| | (278 | ) | Tax exempt | 8,217 |
| | (205 | ) | | 487 |
| | (3 | ) | | 8,704 |
| | (208 | ) | Total municipal bonds | 23,797 |
| | (466 | ) | | 900 |
| | (20 | ) | | 24,697 |
| | (486 | ) | Corporate bonds | 4,961 |
| | (39 | ) | | — |
| | — |
| | 4,961 |
| | (39 | ) | Mortgage-backed or related securities: | | | | | | | | | | | | One- to four-family residential agency guaranteed | 14,972 |
| | (133 | ) | | 22,560 |
| | (705 | ) | | 37,532 |
| | (838 | ) | Multifamily agency guaranteed | 199,407 |
| | (3,162 | ) | | 10,096 |
| | (230 | ) | | 209,503 |
| | (3,392 | ) | Multifamily other | 10,234 |
| | (370 | ) | | — |
| | — |
| | 10,234 |
| | (370 | ) | Total mortgage-backed or related securities | 224,613 |
| | (3,665 | ) | | 32,656 |
| | (935 | ) | | 257,269 |
| | (4,600 | ) | Asset-backed securities: | | | | | | | | | | | | Other asset-backed securities | — |
| | — |
| | 9,510 |
| | (550 | ) | | 9,510 |
| | (550 | ) | | $ | 292,992 |
| | $ | (4,803 | ) | | $ | 44,064 |
| | $ | (1,507 | ) | | $ | 337,056 |
| | $ | (6,310 | ) |
There were six sales of securities—available-for-sale totaling $28.2 million with a resulting net gain of $34,000 during the three months ended March 31, 2014. There were four sales of securities—available-for-sale totaling $13.9 million with a resulting net loss of $117,000 during the three months ended March 31, 2013. At March 31, 2014, there were 94 securities—available for sale with unrealized losses, compared to 114 securities at December 31, 2013. Management does not believe that any individual unrealized loss as of March 31, 2014 represents OTTI. The decline in fair market values of these securities was generally due to changes in interest rates and changes in market-desired spreads subsequent to their purchase. There were no securities—available-for-sale on nonaccrual status at March 31, 2014 and 2013.
The amortized cost and estimated fair value of securities—available-for-sale at March 31, 2014 and December 31, 2013, by contractual maturity, are shown below (in thousands). Expected maturities will differ from contractual maturities because some securities may be called or prepaid with or without call or prepayment penalties. | | | | | | | | | | | | | | | | | | March 31, 2014 | | December 31, 2013 | | Amortized Cost | | Fair Value | | Amortized Cost | | Fair Value | Maturing in one year or less | $ | 22,596 |
| | $ | 22,669 |
| | $ | 25,136 |
| | $ | 25,256 |
| Maturing after one year through five years | 320,498 |
| | 318,483 |
| | 322,493 |
| | 319,489 |
| Maturing after five years through ten years | 56,619 |
| | 56,325 |
| | 58,468 |
| | 57,782 |
| Maturing after ten years through twenty years | 5,220 |
| | 5,045 |
| | 15,535 |
| | 15,135 |
| Maturing after twenty years | 61,933 |
| | 62,135 |
| | 53,328 |
| | 52,618 |
| | $ | 466,866 |
| | $ | 464,657 |
| | $ | 474,960 |
| | $ | 470,280 |
|
Securities—Held-to-Maturity: The amortized cost and estimated fair value of securities—held-to-maturity at March 31, 2014 and December 31, 2013 are summarized as follows (dollars in thousands): | | | | | | | | | | | | | | | | | | | | | March 31, 2014 | | Amortized Cost | | Gross Unrealized Gains | | Gross Unrealized Losses | | Fair Value | | Percent of Total Amortized Cost | U.S. Government and agency obligations | $ | 1,176 |
| | $ | — |
| | $ | (59 | ) | | $ | 1,117 |
| | 1.1 | % | Municipal bonds: | | | | | | | | | | Taxable | 10,551 |
| | 208 |
| | (80 | ) | | 10,679 |
| | 9.6 |
| Tax exempt | 92,460 |
| | 3,523 |
| | (723 | ) | | 95,260 |
| | 84.4 |
| Total municipal bonds | 103,011 |
| | 3,731 |
| | (803 | ) | | 105,939 |
| | 94.0 |
| Corporate bonds | 2,050 |
| | — |
| | — |
| | 2,050 |
| | 1.9 |
| Mortgage-backed or related securities: | | | | | | | | | | Multifamily agency guaranteed | 3,330 |
| | 3 |
| | (30 | ) | | 3,303 |
| | 3.0 |
| | $ | 109,567 |
| | $ | 3,734 |
| | $ | (892 | ) | | $ | 112,409 |
| | 100.0 | % | | | | | | | | | | | | December 31, 2013 | | Amortized Cost | | Gross Unrealized Gains | | Gross Unrealized Losses | | Fair Value | | Percent of Total Amortized Cost | U.S. Government and agency obligations | $ | 1,186 |
| | $ | — |
| | $ | (80 | ) | | $ | 1,106 |
| | 1.2 | % | Municipal bonds: | | | | | | | | | | Taxable | 10,552 |
| | 193 |
| | (204 | ) | | 10,541 |
| | 10.3 |
| Tax exempt | 85,374 |
| | 2,545 |
| | (1,299 | ) | | 86,620 |
| | 83.3 |
| Total municipal bonds | 95,926 |
| | 2,738 |
| | (1,503 | ) | | 97,161 |
| | 93.6 |
| Corporate bonds | 2,050 |
| | — |
| | — |
| | 2,050 |
| | 2.0 |
| Mortgage-backed or related securities: | | | | | | | | | | Multifamily agency guaranteed | 3,351 |
| | — |
| | (58 | ) | | 3,293 |
| | 3.2 |
| | $ | 102,513 |
| | $ | 2,738 |
| | $ | (1,641 | ) | | $ | 103,610 |
| | 100.0 | % |
At March 31, 2014 and December 31, 2013, an age analysis of unrealized losses and fair value of related securities—held-to-maturity was as follows (in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | | March 31, 2014 | | Less Than 12 Months | | 12 Months or More | | Total | | Fair Value | | Unrealized Losses | | Fair Value | | Unrealized Losses | | Fair Value | | Unrealized Losses | U.S. Government and agency obligations | $ | 1,117 |
| | $ | (59 | ) | | $ | — |
| | $ | — |
| | $ | 1,117 |
| | $ | (59 | ) | Municipal bonds: | | | | | | | | | | | | Taxable | 1,593 |
| | (25 | ) | | 3,002 |
| | (55 | ) | | 4,595 |
| | (80 | ) | Tax exempt | 22,129 |
| | (708 | ) | | 306 |
| | (15 | ) | | 22,435 |
| | (723 | ) | Total municipal bonds | 23,722 |
| | (733 | ) | | 3,308 |
| | (70 | ) | | 27,030 |
| | (803 | ) | Mortgage-backed or related securities: | | | | | | | | | | | | Multifamily agency guaranteed | 2,231 |
| | (30 | ) | | — |
| | — |
| | 2,231 |
| | (30 | ) | | $ | 27,070 |
| | $ | (822 | ) | | $ | 3,308 |
| | $ | (70 | ) | | $ | 30,378 |
| | $ | (892 | ) | | | | | | | | | | | | | | December 31, 2013 | | Less Than 12 Months | | 12 Months or More | | Total | | Fair Value | | Unrealized Losses | | Fair Value | | Unrealized Losses | | Fair Value | | Unrealized Losses | U.S. Government and agency obligations | $ | 1,106 |
| | $ | (80 | ) | | $ | — |
| | $ | — |
| | $ | 1,106 |
| | $ | (80 | ) | Municipal bonds: | | | | | | | | | | | | Taxable | 3,344 |
| | (110 | ) | | 2,964 |
| | (94 | ) | | 6,308 |
| | (204 | ) | Tax exempt | 31,234 |
| | (1,282 | ) | | 303 |
| | (17 | ) | | 31,537 |
| | (1,299 | ) | Total municipal bonds | 34,578 |
| | (1,392 | ) | | 3,267 |
| | (111 | ) | | 37,845 |
| | (1,503 | ) | Mortgage-backed or related securities: | | | | | | | | | | | | Multifamily agency guaranteed | 3,293 |
| | (58 | ) | | — |
| | — |
| | 3,293 |
| | (58 | ) | | $ | 38,977 |
| | $ | (1,530 | ) | | $ | 3,267 |
| | $ | (111 | ) | | $ | 42,244 |
| | $ | (1,641 | ) |
There were no sales of securities—held-to-maturity during the three months ended March 31, 2014 and 2013. At March 31, 2014, there were 31 securities—held-to-maturity with unrealized losses, compared to 36 securities at December 31, 2013. Management does not believe that any individual unrealized loss as of March 31, 2014 represents OTTI. The decline in fair market value of these securities was generally due to changes in interest rates and changes in market-desired spreads subsequent to their purchase. There were no securities—held-to-maturity on nonaccrual status at March 31, 2014 and 2013.
The amortized cost and estimated fair value of securities—held-to-maturity at March 31, 2014 and December 31, 2013, by contractual maturity, are shown below (in thousands). Expected maturities will differ from contractual maturities because some securities may be called or prepaid with or without call or prepayment penalties. | | | | | | | | | | | | | | | | | | March 31, 2014 | | December 31, 2013 | | Amortized Cost | | Fair Value | | Amortized Cost | | Fair Value | Maturing in one year or less | $ | 1,270 |
| | $ | 1,277 |
| | $ | 1,270 |
| | $ | 1,281 |
| Maturing after one year through five years | 10,824 |
| | 11,170 |
| | 10,834 |
| | 11,206 |
| Maturing after five years through ten years | 21,001 |
| | 21,059 |
| | 17,948 |
| | 17,908 |
| Maturing after ten years through twenty years | 60,268 |
| | 62,598 |
| | 59,643 |
| | 60,791 |
| Maturing after twenty years | 16,204 |
| | 16,305 |
| | 12,818 |
| | 12,424 |
| | $ | 109,567 |
| | $ | 112,409 |
| | $ | 102,513 |
| | $ | 103,610 |
|
Pledged Securities: The following table presents, as of March 31, 2014, investment securities which were pledged to secure borrowings, public deposits or other obligations as permitted or required by law (in thousands): | | | | | | | | | | | | | | Carrying Value | | Amortized Cost | | Fair Value | Purpose or beneficiary: | | | | | | State and local governments public deposits | $ | 128,207 |
| | $ | 127,997 |
| | $ | 130,975 |
| Interest rate swap counterparties | 8,850 |
| | 8,527 |
| | 8,850 |
| Retail repurchase agreements | 103,394 |
| | 103,120 |
| | 103,394 |
| Total pledged securities | $ | 240,451 |
| | $ | 239,644 |
| | $ | 243,219 |
|
|