Investment Securities

A summary of the available-for-sale and held-to-maturity securities portfolios presenting carrying amounts and gross unrealized gains and losses as of December 31, 2016 and 2015 is as follows:



	December 31, 2016									December 31, 2015
(Dollars in thousands)	Amortized Cost		Gross unrealized gains		Gross unrealized losses			Fair Value		Amortized Cost		Gross unrealized gains		Gross unrealized losses			Fair Value
Available-for-sale securities
U.S. Treasury	$	142,741	$	1	$	(759	)	$	141,983	$	312,282	$	—	$	(5,553	)	$	306,729
U.S. Government agencies	189,540		47		(435		)	189,152		70,313		198		(275		)	70,236
Municipal	129,446		2,969		(606		)	131,809		105,702		3,249		(356		)	108,595
Corporate notes:
Financial issuers	65,260		132		(1,000		)	64,392		80,014		1,510		(1,481		)	80,043
Other	1,000		—		(1		)	999		1,500		4		(2		)	1,502
Mortgage-backed: ⁽¹⁾
Mortgage-backed securities	1,185,448		284		(54,330		)	1,131,402		1,069,680		3,834		(21,004		)	1,052,510
Collateralized mortgage obligations	30,105		67		(490		)	29,682		40,421		172		(506		)	40,087
Equity securities	32,608		3,429		(789		)	35,248		51,380		5,799		(493		)	56,686
Total available-for-sale securities	$	1,776,148	$	6,929	$	(58,410	)	$	1,724,667	$	1,731,292	$	14,766	$	(29,670	)	$	1,716,388
Held-to-maturity securities
U.S. Government agencies	$	433,343	$	7	$	(24,470	)	$	408,880	$	687,302	$	4	$	(7,144	)	$	680,162
Municipal	202,362		647		(4,287		)	198,722		197,524		867		(442		)	197,949
Total held-to-maturity securities	$	635,705	$	654	$	(28,757	)	$	607,602	$	884,826	$	871	$	(7,586	)	$	878,111


(1)	Consisting entirely of residential mortgage-backed securities, none of which are subprime.

In 2015, the Company transferred $862.7 million of investment securities with an unrealized loss of $14.4 million from the available-for-sale classification to the held-to-maturity classification. No investment securities were transferred from the available-for-sale classification to the held-to-maturity classification in 2016.

The following table presents the portion of the Company’s available-for-sale and held-to-maturity securities portfolios which has gross unrealized losses, reflecting the length of time that individual securities have been in a continuous unrealized loss position at December 31, 2016:



	Continuous unrealized losses existing for less than 12 months					Continuous unrealized losses existing for greater than 12 months					Total
(Dollars in thousands)	Fair value		Unrealized losses			Fair value		Unrealized losses			Fair value		Unrealized losses
Available-for-sale securities
U.S. Treasury	$	133,980	$	(759	)	$	—	$	—		$	133,980	$	(759	)
U.S. Government agencies	89,645		(435		)	—		—			89,645		(435		)
Municipal	54,711		(408		)	6,684		(198		)	61,395		(606		)
Corporate notes:
Financial issuers	13,157		(11		)	34,972		(989		)	48,129		(1,000		)
Other	999		(1		)	—		—			999		(1		)
Mortgage-backed:
Mortgage-backed securities	1,116,705		(54,330		)	—		—			1,116,705		(54,330		)
Collateralized mortgage obligations	15,038		(229		)	6,905		(261		)	21,943		(490		)
Equity securities	6,617		(214		)	8,513		(575		)	15,130		(789		)
Total available-for-sale securities	$	1,430,852	$	(56,387	)	$	57,074	$	(2,023	)	$	1,487,926	$	(58,410	)
Held-to-maturity securities
U.S. Government agencies	$	355,621	$	(23,250	)	$	50,033	$	(1,220	)	$	405,654	$	(24,470	)
Municipal	170,707		(4,137		)	5,708		(150		)	176,415		(4,287		)
Total held-to-maturity securities	$	526,328	$	(27,387	)	$	55,741	$	(1,370	)	$	582,069	$	(28,757	)



	Continuous unrealized losses existing for less than 12 months					Continuous unrealized losses existing for greater than 12 months					Total
(Dollars in thousands)	Fair value		Unrealized losses			Fair value		Unrealized losses			Fair value		Unrealized losses
Available-for-sale securities
U.S. Treasury	$	306,729	$	(5,553	)	$	—	$	—		$	306,729	$	(5,553	)
U.S. Government agencies	56,193		(192		)	8,434		(83		)	64,627		(275		)
Municipal	24,673		(261		)	3,680		(95		)	28,353		(356		)
Corporate notes:
Financial issuers	16,225		(266		)	34,744		(1,215		)	50,969		(1,481		)
Other	998		(2		)	—		—			998		(2		)
Mortgage-backed:
Mortgage-backed securities	835,086		(15,753		)	121,249		(5,251		)	956,335		(21,004		)
Collateralized mortgage obligations	12,782		(189		)	9,196		(317		)	21,978		(506		)
Equity securities	4,896		(77		)	8,485		(416		)	13,381		(493		)
Total available-for-sale securities	$	1,257,582	$	(22,293	)	$	185,788	$	(7,377	)	$	1,443,370	$	(29,670	)
Held-to-maturity securities
U.S. Government agencies	$	450,800	$	(4,223	)	$	235,518	$	(2,921	)	$	686,318	$	(7,144	)
Municipal	51,933		(282		)	29,192		(160		)	81,125		(442		)
Total held-to-maturity securities	$	502,733	$	(4,505	)	$	264,710	$	(3,081	)	$	767,443	$	(7,586	)

The Company conducts a regular assessment of its investment securities to determine whether securities are other-than-temporarily impaired considering, among other factors, the nature of the securities, credit ratings or financial condition of the issuer, the extent and duration of the unrealized loss, expected cash flows, market conditions and the Company’s ability to hold the securities through the anticipated recovery period.

The Company does not consider securities with unrealized losses at December 31, 2016 to be other-than-temporarily impaired. The Company does not intend to sell these investments and it is more likely than not that the Company will not be required to sell these investments before recovery of the amortized cost bases, which may be the maturity dates of the securities. The unrealized losses within each category have occurred as a result of changes in interest rates, market spreads and market conditions subsequent to purchase. Securities with continuous unrealized losses existing for more than twelve months were primarily U.S. government agency securities, corporate notes and equity securities.

The following table provides information as to the amount of gross gains and gross losses realized and proceeds received through the sales and calls of investment securities:



	Years Ended December 31,
(Dollars in thousands)	2016			2015			2014
Realized gains	$	9,399		$	658		$	405
Realized losses	(1,754		)	(335		)	(909		)
Net realized gains	$	7,645		$	323		$	(504	)
Other than temporary impairment charges	—			—			—
Gains (losses) on investment securities, net	$	7,645		$	323		$	(504	)
Proceeds from sales and calls of available-for-sale securities	$	2,208,010		$	1,515,559		$	852,330
Proceeds from calls of held-to-maturity securities	734,326			770			—

Net gains on investment securities resulted in income tax expense of $2.9 million in 2016 and $122,000 in 2015. Net losses on investment securities resulted in an income tax benefit included in income tax expense of $194,000 in 2014.

The amortized cost and fair value of securities as of December 31, 2016 and December 31, 2015, by contractual maturity, are shown in the following table. Contractual maturities may differ from actual maturities as borrowers may have the right to call or repay obligations with or without call or prepayment penalties. Mortgage-backed securities are not included in the maturity categories in the following maturity summary as actual maturities may differ from contractual maturities because the underlying mortgages may be called or prepaid without penalties:



	December 31, 2016				December 31, 2015
(Dollars in thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Available-for-sale securities
Due in one year or less	$	145,353	$	145,062	$	160,856	$	160,756
Due in one to five years	321,019		320,423		166,550		166,468
Due in five to ten years	27,319		28,451		228,652		225,699
Due after ten years	34,296		34,399		13,753		14,182
Mortgage-backed	1,215,553		1,161,084		1,110,101		1,092,597
Equity securities	32,608		35,248		51,380		56,686
Total available-for-sale securities	$	1,776,148	$	1,724,667	$	1,731,292	$	1,716,388
Held-to-maturity securities
Due in one year or less	$	—	$	—	$	—	$	—
Due in one to five years	29,794		29,416		19,208		19,156
Due in five to ten years	69,664		67,820		96,454		96,091
Due after ten years	536,247		510,366		769,164		762,864
Total held-to-maturity securities	$	635,705	$	607,602	$	884,826	$	878,111

At December 31, 2016 and December 31, 2015, securities having a carrying value of $1.4 billion and $1.2 billion, respectively, were pledged as collateral for public deposits, trust deposits, FHLB advances, securities sold under repurchase agreements and derivatives. At December 31, 2016, there were no securities of a single issuer, other than U.S. Government-sponsored agency securities, which exceeded 10% of shareholders’ equity.