3. SECURITIES

The following tables reflect the amortized cost, estimated fair value, and gross unrealized gains and losses of AFS and HTM securities at the dates presented. The majority of the MBS and investment securities portfolios are composed of securities issued by United States Government-Sponsored Enterprises ("GSEs").



	December 31, 2015
			Gross		Gross		Estimated
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value
	(Dollars in thousands)
AFS:
GSE debentures	$	421,231	$	130	$	1,923	$	419,438
MBS	204,448		11,092		5		215,535
Trust preferred securities	2,186		—		332		1,854
Municipal bonds	140		3		—		143
	628,005		11,225		2,260		636,970
HTM:
MBS	1,160,584		19,329		8,493		1,171,420
Municipal bonds	39,394		374		8		39,760
	1,199,978		19,703		8,501		1,211,180
	$	1,827,983	$	30,928	$	10,761	$	1,848,150



	September 30, 2015
			Gross		Gross		Estimated
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value
	(Dollars in thousands)
AFS:
GSE debentures	$	525,376	$	1,304	$	60	$	526,620
MBS	217,006		12,489		4		229,491
Trust preferred securities	2,186		—		270		1,916
Municipal bonds	140		4		—		144
	744,708		13,797		334		758,171
HTM:
MBS	1,233,048		27,325		3,590		1,256,783
Municipal bonds	38,074		437		20		38,491
	1,271,122		27,762		3,610		1,295,274
	$	2,015,830	$	41,559	$	3,944	$	2,053,445

The following tables summarize the estimated fair value and gross unrealized losses of those securities on which an unrealized loss at the dates presented was reported and the continuous unrealized loss position for less than 12 months and equal to or greater than 12 months as of the dates presented.



	December 31, 2015
	Less Than 12 Months				Equal to or Greater Than 12 Months
	Estimated		Unrealized		Estimated		Unrealized
	Fair Value		Losses		Fair Value		Losses
	(Dollars in thousands)
AFS:
GSE debentures	$	348,259	$	1,677	$	24,754	$	246
MBS	—		—		711		5
Trust preferred securities	—		—		1,854		332
	$	348,259	$	1,677	$	27,319	$	583


HTM:
MBS	$	275,457	$	1,568	$	284,008	$	6,925
Municipal bonds	5,175		6		395		2
	$	280,632	$	1,574	$	284,403	$	6,927



	September 30, 2015
	Less Than 12 Months				Equal to or Greater Than 12 Months
	Estimated		Unrealized		Estimated		Unrealized
	Fair Value		Losses		Fair Value		Losses
	(Dollars in thousands)
AFS:
GSE debentures	$	39,135	$	15	$	49,955	$	45
MBS	—		—		687		4
Trust preferred securities	—		—		1,916		270
	$	39,135	$	15	$	52,558	$	319


HTM:
MBS	$	38,604	$	134	$	302,158	$	3,456
Municipal bonds	3,292		12		1,128		8
	$	41,896	$	146	$	303,286	$	3,464

The unrealized losses at December 31, 2015 and September 30, 2015 were primarily a result of an increase in market yields from the time the securities were purchased. In general, as market yields rise, the fair value of securities will decrease; as market yields fall, the fair value of securities will increase. Management generally views changes in fair value caused by changes in interest rates as temporary; therefore, these securities have not been classified as other-than-temporarily impaired. The impairment is also considered temporary because scheduled coupon payments have been made, it is anticipated that the entire principal balance will be collected as scheduled, and management neither intends to sell the securities, nor is it more likely than not that the Company will be required to sell the securities before the recovery of the remaining amortized cost amount, which could be at maturity. As a result of the analysis, management has concluded that no other-than-temporary impairments existed at December 31, 2015 or September 30, 2015.

The amortized cost and estimated fair value of debt securities as of December 31, 2015, by contractual maturity, are shown below. Actual principal repayments may differ from contractual maturities due to prepayment or early call privileges by the issuer. In the case of MBS, borrowers on the underlying loans generally have the right to prepay their loans without prepayment penalty. For this reason, MBS are not included in the maturity categories.



	AFS				HTM
	Amortized		Estimated		Amortized		Estimated
	Cost		Fair Value		Cost		Fair Value
	(Dollars in thousands)
One year or less	$	25,117	$	25,214	$	4,884	$	4,917
One year through five years	396,254		394,367		24,604		24,838
Five years through ten years	—		—		9,906		10,005
Ten years and thereafter	2,186		1,854		—		—
	423,557		421,435		39,394		39,760
MBS	204,448		215,535		1,160,584		1,171,420
	$	628,005	$	636,970	$	1,199,978	$	1,211,180

The following table presents the taxable and non-taxable components of interest income on investment securities for the periods presented.



	For the Three Months Ended
	December 31,
	2015		2014
	(Dollars in thousands)
Taxable	$	1,354	$	1,473
Non-taxable	179		202
	$	1,533	$	1,675

The following table summarizes the amortized cost and estimated fair value of securities pledged as collateral for the obligations listed below as of the dates presented.



	December 31, 2015				September 30, 2015
	Amortized		Estimated		Amortized		Estimated
	Cost		Fair Value		Cost		Fair Value
	(Dollars in thousands)
Public unit deposits	$	383,107	$	384,158	$	342,620	$	347,505
Repurchase agreements	216,857		224,300		217,073		225,806
FHLB borrowings	203,395		202,385		216,607		218,199
Federal Reserve Bank	18,792		19,426		20,134		20,989
	$	822,151	$	830,269	$	796,434	$	812,499