Note 3 - Investment Securities

9 Months Ended

Sep. 30, 2015

Investments, Debt and Equity Securities [Abstract]

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

3 - INVESTMENT SECURITIES

The following tables set forth the amortized cost and estimated fair values of the Bank’s investment securities.

	September 30, 2015
			Gross		Gross
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
Held-to-Maturity Securities:	(in thousands)
State and municipals	$	16,991	$	617	$	-		$	17,608
Pass-through mortgage securities		766		96		-			862
Collateralized mortgage obligations		931		69		-			1,000
	$	18,688	$	782	$	-		$	19,470
Available-for-Sale Securities:
State and municipals	$	410,887	$	17,005	$	(399	)	$	427,493
Pass-through mortgage securities		155,616		1,182		(572	)		156,226
Collateralized mortgage obligations		164,587		4,017		(287	)		168,317
	$	731,090	$	22,204	$	(1,258	)	$	752,036
	December 31, 2014
Held-to-Maturity Securities:
State and municipals	$	19,836	$	843	$	-		$	20,679
Pass-through mortgage securities		856		110		-			966
Collateralized mortgage obligations		1,141		84		-			1,225
	$	21,833	$	1,037	$	-		$	22,870
Available-for-Sale Securities:
State and municipals	$	393,637	$	18,612	$	(452	)	$	411,797
Pass-through mortgage securities		130,966		1,421		(1,206	)		131,181
Collateralized mortgage obligations		226,879		4,847		(559	)		231,167
	$	751,482	$	24,880	$	(2,217	)	$	774,145

At September 30, 2015 and December 31, 2014, investment securities with a carrying value of $419,052,000 and $369,951,000, respectively, were pledged as collateral to secure public deposits and borrowed funds.

There were no holdings of any one issuer, other than the U.S. Government and its agencies, in an amount greater than 10% of stockholders’ equity at September 30, 2015 and December 31, 2014.

Securities With Unrealized Losses. The following tables set forth securities with unrealized losses presented by the length of time the securities have been in a continuous unrealized loss position.

	September 30, 2015
	Less than					12 Months
	12 Months					or More					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
	Value		Loss			Value		Loss			Value		Loss
	(in thousands)
State and municipals	$	31,378	$	(308	)	$	5,269	$	(91	)	$	36,647	$	(399	)
Pass-through mortgage securities		60,790		(232	)		28,997		(340	)		89,787		(572	)
Collateralized mortgage obligations		18,274		(16	)		12,127		(271	)		30,401		(287	)
Total temporarily impaired	$	110,442	$	(556	)	$	46,393	$	(702	)	$	156,835	$	(1,258	)
	December 31, 2014
State and municipals	$	19,386	$	(145	)	$	21,198	$	(307	)	$	40,584	$	(452	)
Pass-through mortgage securities		-		-			100,556		(1,206	)		100,556		(1,206	)
Collateralized mortgage obligations		15,420		(84	)		17,227		(475	)		32,647		(559	)
Total temporarily impaired	$	34,806	$	(229	)	$	138,981	$	(1,988	)	$	173,787	$	(2,217	)

Because the unrealized losses reflected in the preceding tables are deemed by management to be attributable to changes in interest rates and not credit losses, and because management does not have the intent to sell these securities and it is not more likely than not that it will be required to sell these securities before their anticipated recovery, the Bank does not consider these securities to be other-than-temporarily impaired at September 30, 2015.

Sales of Available-for-Sale Securities. Sales of available-for-sale securities were as follows:

	Nine Months Ended						Three Months Ended
	September 30,						September 30,
	2015			2014			2015		2014
	(in thousands)
Proceeds	$	66,140		$	3,390		$	-	$	70
Gains	$	1,501		$	42		$	-	$	1
Losses		(376	)		(20	)		-		-
Net gain	$	1,125		$	22		$	-	$	1

Income tax expense related to the net realized gains was $463,000 and $9,000 for the nine months ended September 30, 2015 and 2014, respectively.

Sales of Held-to-Maturity Securities. During the second quarter of 2015, the Bank sold one municipal security that was classified as held-to-maturity. The sale was in response to a significant deterioration in the creditworthiness of the issuer. The security sold had a carrying value of $235,000 at the time of sale and the Bank realized a gain upon sale of $8,000.

During the third quarter of 2014, the Bank sold certain mortgage-backed securities that were classified as held-to-maturity securities. The sales occurred after the Bank had collected at least 85% of the principal balance outstanding at acquisition of each security. In addition, the Bank sold one municipal security that was classified as held-to-maturity in response to a significant deterioration in the creditworthiness of the issuer. The securities sold had a carrying value of $419,000 at the time of sale and the Bank realized a gain upon sale of $22,000.

During the second quarter of 2014, the Bank sold municipal securities of three issuers that were classified as held-to-maturity. The sales were in response to a significant deterioration in the creditworthiness of the issuers. The securities sold had a carrying value of $725,000 at the time of sale and the Bank realized a gain upon sale of $31,000.

During the first quarter of 2014, the Bank sold certain mortgage-backed securities that were classified as held-to-maturity. The sales occurred after the Bank collected 85% or more of the principal outstanding at acquisition of each security. The securities sold had a carrying value of $1.2 million at the time of sale and the Bank realized a gain upon sale of $66,000.

Maturities. The following table sets forth by maturity the amortized cost and fair value of the Bank’s state and municipal securities at September 30, 2015 based on the earlier of their stated maturity or, if applicable, their pre-refunded date. The remaining securities in the Bank’s investment securities portfolio are mortgage-backed securities, consisting of pass-through securities and collateralized mortgage obligations. Although these securities are expected to have substantial periodic repayments they are reflected in the table below in aggregate amounts.

	Amortized Cost		Fair Value
Held-to-Maturity Securities:	(in thousands)
Within one year	$	3,951	$	3,971
After 1 through 5 years		8,875		9,275
After 5 through 10 years		3,332		3,491
After 10 years		833		871
Mortgage-backed securities		1,697		1,862
	$	18,688	$	19,470
Available-for-Sale Securities:
Within one year	$	9,117	$	9,324
After 1 through 5 years		37,545		38,935
After 5 through 10 years		143,566		148,642
After 10 years		220,659		230,592
Mortgage-backed securities		320,203		324,543
	$	731,090	$	752,036