Note D -Securities

The amortized cost and fair value of securities available for sale and held to maturity at March 31, 2018 and December 31, 2017 are summarized as follows:

	March 31, 2018
	Gross		Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value
	(In thousands)
Debt securities available for sale
U.S. Treasury securities and obligations of U.S. Government Entities	$	8,697	$	214	$	(14)	$	8,897
Mortgage-backed securities of U.S. Government Sponsored Entities		328,521		225		(8,861)		319,885
Collateralized mortgage obligations of U.S. Government Sponsored Entities		281,335		70		(8,127)		273,278
Commercial mortgage backed securities of U.S. Government Sponsored Entities		16,183		8		(150)		16,041
Private mortgage backed securities		18,070		379		0		18,449
Private collateralized mortgage obligations		44,374		608		(266)		44,716
Collateralized loan obligations		256,058		731		(3)		256,786
Obligations of state and political subdivisions		45,003		384		(481)		44,906
Totals	$	998,241	$	2,619	$	(17,902)	$	982,958

Debt securities held to maturity
Mortgage-backed securities of U.S. Government Sponsored Entities	$	168,462	$	0	$	(3,524)	$	164,938
Collateralized mortgage obligations of U.S. Government Sponsored Entities		174,080		0		(5,841)		168,239
Commercial mortgage backed securities of U.S. Government Sponsored Entities		17,487		412		0		17,899
Collateralized loan obligations		35,600		211		0		35,811
Private collateralized mortgage obligations		5,018		9		(47)		4,980
Totals	$	400,647	$	632	$	(9,412)	$	391,867

	December 31, 2017
	Gross		Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value
	(In thousands)
Debt securities available for sale
U.S. Treasury securities and obligations of U.S. Government Entities	$	9,475	$	274	$	(5)	$	9,744
Mortgage-backed securities of U.S. Government Sponsored Entities		318,771		891		(3,306)		316,356
Collateralized mortgage obligations of U.S. Government Sponsored Entities		235,466		272		(4,694)		231,044
Commercial mortgage backed securities of U.S. Government Sponsored Entities		16,210		165		(34)		16,341
Private mortgage backed securities		18,056		384		0		18,440
Private collateralized mortgage obligations		47,045		605		(285)		47,365
Collateralized loan obligations		263,579		798		(68)		264,309
Obligations of state and political subdivisions		45,118		813		(70)		45,861
Totals	$	953,720	$	4,202	$	(8,462)	$	949,460

Debt securities held to maturity
Mortgage-backed securities of U.S. Government Sponsored Entities	$	172,261	$	746	$	(1,392)	$	171,615
Collateralized mortgage obligations of U.S. Government Sponsored Entities		181,280		56		(2,767)		178,569
Commercial mortgage backed securities of U.S. Government Sponsored Entities		17,462		705		0		18,167
Collateralized loan obligations		40,523		303		0		40,826
Private collateralized mortgage obligations		5,337		9		(53)		5,293
Totals	$	416,863	$	1,819	$	(4,212)	$	414,470

There were no sales of securities during the three month periods ended March 31, 2018 and March 31, 2017, respectively. Included in “Securities losses, net” for the three month period ended March 31, 2018, is a $0.1 million decline in the value of an investment in shares of a mutual fund that invests primarily in CRA-qualified debt securities.

At March 31, 2018, debt securities with a fair value of $178.8 million were pledged as collateral for United States Treasury deposits, other public deposits and trust deposits, and debt securities with a fair value of $173.2 million were pledged as collateral for repurchase agreements.

The amortized cost and fair value of debt securities at March 31, 2018, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because prepayments of the underlying collateral for these securities may occur, due to the right to call or repay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately.

	Held to Maturity				Available for Sale
	Amortized		Fair		Amortized		Fair
	Cost		Value		Cost		Value
	(In thousands)
Due in less than one year	$	0	$	0	$	7,635	$	7,849
Due after one year through five years		3,600		3,602		34,651		34,673
Due after five years through ten years		32,000		32,209		254,328		255,151
Due after ten years		0		0		13,144		12,916
		35,600		35,811		309,758		310,589
Mortgage-backed securities of U.S. Government Sponsored Entities		168,462		164,938		328,521		319,885
Collateralized mortgage obligations of U.S. Government Sponsored Entities		174,080		168,239		281,335		273,278
Commercial mortgage backed securities of U.S. Government Sponsored Entities		17,487		17,899		16,183		16,041
Private mortgage-backed securities		0		0		18,070		18,449
Private collateralized mortgage obligations		5,018		4,980		44,374		44,716
	$	400,647	$	391,867	$	998,241	$	982,958

The estimated fair value of a security is determined based on market quotations when available or, if not available, by using quoted market prices for similar securities, pricing models or discounted cash flows analyses, using observable market data where available. The tables below indicate the amount of debt securities with unrealized losses and the period of time for which these losses were outstanding at March 31, 2018 and December 31, 2017, respectively.

	March 31, 2018
	Less than 12 months				12 months or longer				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Losses		Value		Losses		Value		Losses

	(In thousands)
U.S. Treasury securities and obligations of U.S. Government Entities	$	895	$	(14)	$	0	$	0	$	895	$	(14)
Mortgage-backed securities of U.S. Government Sponsored Entities		257,394		(4,629)		214,042		(7,756)		471,436		(12,385)
Collateralized mortgage obligations of U.S. Government Sponsored Entities		242,193		(5,403)		188,936		(8,565)		431,129		(13,968)
Commercial mortgage backed securities of U.S. Government Sponsored Entities		7,925		(78)		3,032		(72)		10,957		(150)
Private collateralized mortgage obligations		762		(1)		19,586		(312)		20,348		(313)
Collateralized loan obligations		12,747		(3)		0		0		12,747		(3)
Obligations of state and political subdivisions		18,722		(227)		12,488		(254)		31,210		(481)
Total temporarily impaired securities	$	540,638	$	(10,355)	$	438,084	$	(16,959)	$	978,722	$	(27,314)

	December 31, 2017
	Less than 12 months				12 months or longer				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Losses		Value		Losses		Value		Losses

	(In thousands)
U.S. Treasury securities and obligations of U.S. Government Entities	$	1,107	$	(5)	$	0	$	0	$	1,107	$	(5)
Mortgage-backed securities of U.S. Government Sponsored Entities		123,195		(515)		213,590		(4,183)		336,785		(4,698)
Collateralized mortgage obligations of U.S. Government Sponsored Entities		176,452		(1,507)		199,086		(5,954)		375,538		(7,461)
Commercial mortgage backed securities of U.S. Government Sponsored Entities		5,076		(25)		1,049		(9)		6,125		(34)
Private collateralized mortgage obligations		0		0		20,744		(338)		20,744		(338)
Collateralized loan obligations		14,933		(68)		0		0		14,933		(68)
Obligations of state and political subdivisions		5,414		(14)		5,864		(56)		11,278		(70)
Total temporarily impaired securities	$	326,177	$	(2,134)	$	440,333	$	(10,540)	$	766,510	$	(12,674)

The two tables above include debt securities held to maturity that were transferred from available for sale into held to maturity during 2014. Those securities had unrealized losses of $3.0 million at the date of transfer, and at March 31, 2018, the unamortized balance was $1.1 million. The fair value of those securities in an unrealized loss position for less than twelve months at March 31, 2018 and December 31, 2017 was $63.3 million and $22.9 million, respectively, with unrealized losses of $0.8 million and $0.2 million, respectively. The fair value of those securities in an unrealized loss position for 12 months or more at March 31, 2018 and December 31, 2017 is $14.1 million and $15.3 million, respectively, with unrealized losses of $0.6 million and $0.4 million, respectively.

At March 31, 2018, the Company had $26.5 million of unrealized losses on mortgage backed securities of government sponsored entities having a fair value of $913.5 million that were attributable to a combination of factors, including relative changes in interest rates since the time of purchase. The contractual cash flows for these debt securities are guaranteed by U.S. government agencies and U.S. government-sponsored enterprises. Based on our assessment of these mitigating factors, management believes that the unrealized losses on these holdings are a function of changes in investment spreads and interest movements and not changes in credit quality. Management expects to recover the entire amortized cost basis of these securities.

At March 31, 2018, $0.3 million of the unrealized losses pertained to private label debt securities secured by seasoned residential collateral with a fair value was $20.3 million. Management attributes the loss to a combination of factors, including relative changes in interest rates since the time of purchase. The collateral underlying these mortgage investments are 30- and 15-year fixed and 10/1 adjustable rate mortgage loans with low loan to values, and improving subordination. Based on its assessment of these factors and bi-annual stress testing, management believes that the unrealized losses on these holdings are a function of changes in investment spreads and interest rate movements and not changes in credit quality. Management expects to recover the entire amortized cost basis of these securities.

At March 31, 2018, obligations of state and political subdivisions with a fair value of $31.2 million had unrealized losses of $0.5 million. Management believes that unrealized losses on these obligations are a function of changes in investment spreads and interest movements and not changes in credit quality. Management expects to recover the entire amortized cost basis of these securities.

As of March 31, 2018, the Company does not intend to sell debt securities that are in an unrealized loss position and it is not more likely than not that the Company will be required to sell these securities before recovery of the amortized cost basis. Therefore, management does not consider any investment to be other-than-temporarily impaired at March 31, 2018.

Included in other assets is $35.0 million of Federal Home Loan Bank and Federal Reserve Bank stock stated at par value. At March 31, 2018, the Company had not identified events or changes in circumstances which may have a significant adverse effect on the fair value of these investments. Also included in other assets is a $6.2 million investment in a mutual fund carried at fair value.

The Company holds 11,330 shares of Visa Class B stock, which following resolution of pending litigation will be converted to Visa Class A shares (the conversion rate was 1.6483 shares of Class A stock for each share of Class B stock) for a total of 18,675 shares of Visa Class A stock. Our ownership of these shares is related to prior ownership in Visa’s network while Visa operated as a cooperative. This ownership is recorded on our financial records at zero basis.