INVESTMENT SECURITIES

The amortized cost and approximate fair value of investment securities as of September 30, 2015 and December 31, 2014 are summarized in the tables below:



	September 30, 2015
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
(amounts in thousands)
Available for Sale:
Mortgage-backed securities (1)	$	364,292	$	3,327	$	(1,859	)	$	365,760
Corporate notes	35,000		451		(129		)	35,322
Equity securities (2)	22,514		—		(4,651		)	17,863
	$	421,806	$	3,778	$	(6,639	)	$	418,945


(1)	Comprised of mortgage-backed securities issued by government-sponsored agencies, including FHLMC, FNMA, and GNMA.


(2)	Comprised primarily of equity securities in a foreign entity.



	December 31, 2014
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
(amounts in thousands)
Available for Sale:
Mortgage-backed securities (1)	$	376,854	$	2,805	$	(2,348	)	$	377,311
Corporate notes	15,000		104		—			15,104
Equity securities (2)	23,074		1,197		(1		)	24,270
	$	414,928	$	4,106	$	(2,349	)	$	416,685


(1)	Comprised primarily of mortgage-backed securities issued by government-sponsored agencies, including FHLMC, FNMA, and GNMA.


(2)	Comprised primarily of equity securities in a foreign entity.

The following table presents proceeds from the sale of available-for-sale investment securities and gross gains and gross losses realized on those sales for the three and nine months ended September 30, 2015 and 2014:



	Three Months Ended September 30,					Nine Months Ended September 30,
	2015			2014		2015			2014
(amounts in thousands)
Proceeds from sale of available-for-sale securities	$	314		$	—	$	806		$	213,249
Gross gains	$	—		—		$	—		$	3,191
Gross losses	(16		)	—		(85		)	—
Net gains (losses)	$	(16	)	$	—	$	(85	)	$	3,191

These gains and losses were determined using the specific identification method and were reported as gains/(losses) on sale of investment securities included in non-interest income.

The following table presents available-for-sale debt securities by stated maturity. Debt securities backed by mortgages have expected maturities that differ from contractual maturities because borrowers have the right to call or prepay and, therefore, these debt securities are classified separately with no specific maturity date:



	September 30, 2015
	Amortized Cost		Fair Value
(amounts in thousands)
Due in one year or less	$	—	$	—
Due after one year through five years	—		—
Due after five years through ten years	28,000		28,403
Due after ten years	7,000		6,919
Mortgage-backed securities	364,292		365,760
Total debt securities	$	399,292	$	401,082

Customers' investments’ gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at September 30, 2015 and December 31, 2014 were as follows:



	September 30, 2015
	Less Than 12 Months					12 Months or More					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
(amounts in thousands)
Available for Sale:
Mortgage-backed securities (1)	$	—	$	—		$	67,264	$	(1,859	)	$	67,264	$	(1,859	)
Corporate notes	8,871		(129		)	—		—			8,871		(129		)
Equity securities (2)	17,857		(4,650		)	6		(1		)	17,863		(4,651		)
Total	$	26,728	$	(4,779	)	$	67,270	$	(1,860	)	$	93,998	$	(6,639	)



	December 31, 2014
	Less Than 12 Months					12 Months or More					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
(amounts in thousands)
Available for Sale:
Mortgage-backed securities (3)	$	60,388	$	(81	)	$	80,426	$	(2,267	)	140,814		$	(2,348	)
Equity securities (2)	—		—			5		(1		)	5		(1		)
Total	$	60,388	$	(81	)	$	80,431	$	(2,268	)	$	140,819	$	(2,349	)


(1)	Comprised of mortgage-backed securities issued by government-sponsored agencies, including FHLMC, FNMA, and GNMA at September 30, 2015.


(2)	Comprised primarily of equity securities in a foreign entity.


(3)	Comprised primarily of mortgage-backed securities issued by government-sponsored agencies, including FHLMC, FNMA, and GNMA at December 31, 2014.

At September 30, 2015, there were four available-for-sale investment securities in the less-than-twelve-month category and sixteen available-for-sale investment securities in the twelve-month-or-more category. The unrealized losses on the mortgage-backed securities are guaranteed by government-sponsored entities and primarily relate to changes in market interest rates. All amounts are expected to be recovered when market prices recover or at maturity. The unrealized losses on the equity securities reflect decreases in market price and adverse changes in foreign currency exchange rates. Customers evaluated the financial condition and capital strength of the issuer of these securities and concluded that the decline in fair value was temporary and would recover by way of increases in market price or positive changes in foreign currency exchange rates. Customers intends to hold these securities for the foreseeable future and does not intend to sell the securities before the price recovers. Customers considers it more likely than not that it will not be required to sell the securities. Accordingly, Customers has concluded that the securities are not other-than-temporarily impaired as of September 30, 2015.

At September 30, 2015 and December 31, 2014, Customers Bank had pledged investment securities aggregating $318.1 million and $376.9 million fair value, respectively, as collateral against its borrowings primarily with the FHLB and an unused line of credit with another financial institution. These counterparties do not have the ability to sell or repledge these securities.