INVESTMENT SECURITIES

The amortized cost and estimated fair value of the Company's investment securities, with gross unrealized gains and losses, follows:



	June 30, 2014
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(In Thousands)
Available for Sale
Debt securities:
Corporate bonds	$	3,026	$	60	$	—		$	3,086
Residential mortgage-backed securities:
Agency	128,938		1,629		(1,494		)	129,073
Non-agency	1,688		15		(5		)	1,698
Total debt securities	133,652		1,704		(1,499		)	133,857
Marketable equity securities	51		28		—			79
Total securities available for sale	$	133,703	$	1,732	$	(1,499	)	$	133,936

Held to Maturity
Municipal bonds	$	9,302	$	—	$	—		$	9,302
Total securities held to maturity	$	9,302	$	—	$	—		$	9,302



	June 30, 2013
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(In Thousands)
Available for Sale
Debt securities:
Municipal bonds	$	395	$	—	$	—		$	395
Corporate bonds	3,036		40		—			3,076
Residential mortgage-backed securities:
Agency	132,498		1,916		(1,426		)	132,988
Non-agency	2,209		10		(16		)	2,203
Total debt securities	138,138		1,966		(1,442		)	138,662
Marketable equity securities	51		17		—			68
Total securities available for sale	$	138,189	$	1,983	$	(1,442	)	$	138,730

Residential mortgage-backed agency securities are mortgage-backed securities that have been issued by the federal government or its agencies or government-sponsored enterprises. Residential mortgage-backed non-agency securities are mortgage-backed securities that have been issued by private mortgage originators.

During the year ended June 30, 2014, $9.3 million in municipal securities were transferred at fair value from the available for sale category to the held to maturity category, as management has no intentions of selling any municipal security prior to maturity. There is no readily available market pricing and no active market to sell these securities, however management believes that the amortized cost of these securities approximates fair value based on their relatively short terms to maturity.

Certain investment securities are pledged to secure FHLB advances. See Note 8.

INVESTMENT SECURITIES (Continued)

The amortized cost and estimated fair value of debt securities by contractual maturity at June 30, 2014 are set forth below. Expected maturities will differ from contractual maturities because the issuer may have the right to call or prepay obligations with or without call or prepayment penalties.



	Securities Available for Sale				Securities Held to Maturity
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
	(In Thousands)
Within 1 year	$	—	$	—	$	6,813	$	6,813
After 1 year but within 5 years	3,026		3,086		2,489		2,489
Total bonds, obligations, and municipals	3,026		3,086		9,302		9,302
Residential mortgage-backed securities:
Agency	128,938		129,073		—		—
Non-agency	1,688		1,698		—		—
Total debt securities	$	133,652	$	133,857	$	9,302	$	9,302

For the year ended June 30, 2014 there were no sales of securities available for sale. For the years ended June 30, 2013 and 2012, proceeds from sales of securities available for sale amounted to $3.2 million and $1.3 million, respectively. For the same periods, gross realized gains amounted to $114,000 and $19,000, respectively.

Information pertaining to securities with gross unrealized losses at June 30, 2014 and 2013, aggregated by investment category and length of time that individual securities have been in a continuous loss position, follows:



	Less Than Twelve Months				Over Twelve Months				Total
	Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value
	(In Thousands)
June 30, 2014:
Residential mortgage-backed securities:
Agency	$	38	$	7,357	$	1,456	$	51,094	$	1,494	$	58,451
Non-agency	1		143		4		234		5		377
	$	39	$	7,500	$	1,460	$	51,328	$	1,499	$	58,828
June 30, 2013:
Residential mortgage-backed securities:
Agency	$	1,337	$	68,456	$	89	$	6,142	$	1,426	$	74,598
Non-agency	5		330		11		1,047		16		1,377
	$	1,342	$	68,786	$	100	$	7,189	$	1,442	$	75,975

Management conducts, at least on a quarterly basis, a review of our investment securities to determine if the value of any security has declined below its cost or amortized cost and whether such decline represents other-than-temporary impairment (“OTTI”). There was no impairment charge recognized for the years ended June 30, 2014, 2013 and 2012.

INVESTMENT SECURITIES (Concluded)

At June 30, 2014, 47 debt securities had unrealized losses with aggregate depreciation of 2.5% from the Company's amortized cost basis. In analyzing an issuer's financial condition, management considers whether the securities are issued by the federal government, its agencies or government-sponsored enterprises, whether downgrades by bond rating agencies have occurred, and industry analyst's reports. The unrealized losses in residential mortgage-backed securities were primarily caused by interest rate

changes. As management has not decided to sell these securities, nor is it likely that the Company will be required to sell these securities, no declines are deemed to be other than temporary. At June 30, 2014, nine securities issued by private mortgage originators had unrealized losses. Such securities had an amortized cost of $382,000 and a fair value of $377,000. All of these investments are “Senior” Class tranches and have underlying credit enhancement. These securities were originated in the period 2002-2005 and are performing in accordance with contractual terms. Management estimates the loss projections for each security by evaluating the industry rating, amount of delinquencies, amount of foreclosure, amount of other real estate owned, average credit scores, average amortized loan to value and credit enhancement. Based on this review, management determined that no OTTI existed as of June 30, 2014.