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Securities
6 Months Ended
Jun. 30, 2011
Securities  
Securities

 

Note 2 - Securities

A summary of the amortized cost and estimated fair value of securities, excluding trading securities, is presented below.

 

     June 30, 2011      December 31, 2010  
     Amortized
Cost
     Gross
Unrealized
Gains
     Gross
Unrealized
Losses
     Estimated
Fair Value
     Amortized
Cost
     Gross
Unrealized
Gains
     Gross
Unrealized
Losses
     Estimated
Fair Value
 

Held to Maturity

                       

U. S. Treasury

   $ 247,606       $ 19,581       $ —         $ 267,187       $ 247,421       $ 13,517       $ —         $ 260,938   

Residential mortgage-backed securities

     4,103         165         —           4,268         4,405         136         —           4,541   

States and political subdivisions

     97,288         1,577         345         98,520         30,803         —           1,054         29,749   

Other

     1,000         —           —           1,000         1,000         —           —           1,000   
                                                                       

Total

   $ 349,997       $ 21,323       $ 345       $ 370,975       $ 283,629       $ 13,653       $ 1,054       $ 296,228   
                                                                       

Available for Sale:

                       

U. S. Treasury

   $ 773,274       $ 21,011       $ —         $ 794,285       $ 973,033       $ 13,998       $ —         $ 987,031   

Residential mortgage-backed securities

     2,356,226         128,439         2         2,484,663         1,989,299         103,018         987         2,091,330   

States and political subdivisions

     2,026,204         91,776         2,554         2,115,426         2,008,618         53,358         21,676         2,040,300   

Other

     37,980         —           —           37,980         38,809         —           —           38,809   
                                                                       

Total

   $ 5,193,684       $ 241,226       $ 2,556       $ 5,432,354       $ 5,009,759       $ 170,374       $ 22,663       $ 5,157,470   
                                                                       

All mortgage-backed securities included in the above table were issued by U.S. government agencies and corporations. Securities with limited marketability, such as stock in the Federal Reserve Bank and the Federal Home Loan Bank, are carried at cost and are reported as other available for sale securities in the above table. The carrying value of securities pledged to secure public funds, trust deposits, repurchase agreements and for other purposes, as required or permitted by law was $2.1 billion and $2.3 billion at June 30, 2011 and December 31, 2010.

As of June 30, 2011, securities, with unrealized losses segregated by length of impairment, were as follows:

 

     Less than 12 Months      More than 12 Months      Total  
     Estimated
Fair Value
     Unrealized
Losses
     Estimated
Fair Value
     Unrealized
Losses
     Estimated
Fair Value
     Unrealized
Losses
 

Held to Maturity

                 

States and political subdivisions

   $ 23,446       $ 345       $ —         $ —         $ 23,446       $ 345   
                                                     

Total

   $ 23,446       $ 345       $ —         $ —         $ 23,446       $ 345   
                                                     

Available for Sale

                 

Residential mortgage-backed securities

   $ 352       $ 2       $ —         $ —         $ 352       $ 2   

States and political subdivisions

     271,806         2,527         667         27         272,473         2,554   
                                                     

Total

   $ 272,158       $ 2,529       $ 667       $ 27       $ 272,825       $ 2,556   
                                                     

Declines in the fair value of held-to-maturity and available-for-sale securities below their cost that are deemed to be other than temporary are reflected in earnings as realized losses to the extent the impairment is related to credit losses. The amount of the impairment related to other factors is recognized in other comprehensive income. In estimating other-than-temporary impairment losses, management considers, among other things, (i) the length of time and the extent to which the fair value has been less than cost, (ii) the financial condition and near-term prospects of the issuer, and (iii) the intent and ability of the Corporation to retain its investment in the issuer for a period of time sufficient to allow for any anticipated recovery in cost.

Management has the ability and intent to hold the securities classified as held to maturity in the table above until they mature, at which time the Corporation will receive full value for the securities. Furthermore, as of June 30, 2011, management does not have the intent to sell any of the securities classified as available for sale in the table above and believes that it is more likely than not that the Corporation will not have to sell any such securities before a recovery of cost. Any unrealized losses are largely due to increases in market interest rates over the yields available at the time the underlying securities were purchased. The fair value is expected to recover as the bonds approach their maturity date or repricing date or if market yields for such investments decline. Management does not believe any of the securities are impaired due to reasons of credit quality. Accordingly, as of June 30, 2011, management believes the impairments detailed in the table above are temporary and no impairment loss has been realized in the Corporation's consolidated income statement.

 

The amortized cost and estimated fair value of securities, excluding trading securities, at June 30, 2011 are presented below by contractual maturity. Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations. Residential mortgage-backed securities and equity securities are shown separately since they are not due at a single maturity date.

 

     Held to Maturity      Available for Sale  
     Amortized
Cost
     Estimated
Fair Value
     Amortized
Cost
     Estimated
Fair Value
 

Due in one year or less

   $ —         $ —         $ 44,715       $ 45,289   

Due after one year through five years

     1,000         1,000         829,948         854,447   

Due after five years through ten years

     250,953         270,674         172,958         182,651   

Due after ten years

     93,941         95,033         1,751,857         1,827,324   

Residential mortgage-backed securities

     4,103         4,268         2,356,226         2,484,663   

Equity securities

     —           —           37,980         37,980   
                                   

Total

   $ 349,997       $ 370,975       $ 5,193,684       $ 5,432,354   
                                   

Sales of securities available for sale were as follows:

 

      Three Months Ended
June 30,
     Six Months Ended
June 30,
 
     2011      2010      2011      2010  

Proceeds from sales

   $ 845       $ 2,999,251       $ 5,548,386       $ 9,997,994   

Gross realized gains

     —           1         9         8   

Gross realized losses

     —           —           4         2   

Trading account securities, at estimated fair value, were as follows:

 

     June 30,
2011
     December 31,
2010
 

U.S. Treasury

   $ 14,517       $ 14,986   

States and political subdivisions

     —           115   
                 

Total

   $ 14,517       $ 15,101   
                 

Net gains and losses on trading account securities were as follows:

 

      Three Months Ended
June 30,
     Six Months Ended
June  30,
 
     2011      2010      2011      2010  

Net gain on sales transactions

   $ 161       $ 398       $ 469       $ 880   

Net mark-to-market gains

     7         71         7         123   
                                   

Net gain on trading account securities

   $ 168       $ 469       $ 476       $ 1,003