Note 3. Securities

The amortized cost and fair value of securities classified as available for sale and held to maturity follow (in thousands):


Securities Available for Sale
	December 31, 2012								December 31, 2011
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
U.S. Treasury	$	150	$	8	$	—	$	158	$	150	$	14	$	—	$	164
U.S. government agencies		18,096		11		—		18,107		248,595		1,308		—		249,903
Municipal obligations		49,608		571		14		50,165		294,489		15,218		42		309,665
Mortgage-backed securities		1,715,524		58,903		21		1,774,406		2,422,891		58,150		696		2,480,345
CMOs		196,723		1,354		—		198,077		1,426,495		21,774		2,193		1,446,076
Corporate debt securities		2,250		—		—		2,250		4,517		11		34		4,494
Other equity securities		4,531		752		4		5,279		4,208		2,086		41		6,253

	$	1,986,882	$	61,599	$	39	$	2,048,442	$	4,401,345	$	98,561	$	3,006	$	4,496,900


Securities Held to Maturity
	December 31, 2012								December 31, 2011
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Municipal obligations	$	164,493	$	16,017	$	—	$	180,510		—		—		—		—
Mortgage-backed securities		180,397		3,429		—		183,826		—		—		—		—
CMOs		1,323,128		23,942		941		1,346,129		—		—		—		—

	$	1,668,018	$	43,388	$	941	$	1,710,465		—		—		—		—

During the first quarter of 2012, the Company reclassified approximately $1.5 billion of securities available for sale as securities held to maturity. As a result of the acquisition of Whitney National Bank, the securities portfolio increased to such a size that the Company determined that only a portion of the portfolio needed to be classified as available for sale for liquidity purposes. The securities reclassified consisted primarily of collateral mortgage obligations (CMOs) and in-market municipal securities. The securities were transferred at fair value, which became the cost basis for the securities held to maturity. The unrealized net holding gain on the available for sale securities on the date of transfer totaled approximately $39 million and continued to be reported, net of tax, as a component of accumulated other comprehensive income. This net unrealized gain is being accreted to interest income over the remaining life of the securities as a yield adjustment, which serves to offset the impact of the amortization of the net premium created in the transfer. There were no gains or losses recognized as a result of this transfer.

The following table presents the amortized cost and fair value of debt securities at December 31, 2012 by contractual maturity (in thousands). Actual maturities will differ from contractual maturities because of rights to call or repay obligations with or without penalties.


	Amortized Cost		Fair Value
Debt Securities Available for Sale
Due in one year or less	$	43,855	$	44,003
Due after one year through five years		241,988		244,207
Due after five years through ten years		249,802		259,924
Due after ten years		1,446,706		1,495,029

Total available for sale debt securities	$	1,982,351	$	2,043,163


	Amortized Cost		Fair Value
Debt Securities Held to Maturity
Due in one year or less	$	14,545	$	14,626
Due after one year through five years		417,869		427,022
Due after five years through ten years		94,584		104,739
Due after ten years		1,141,020		1,164,078

Total held to maturity securities	$	1,668,018	$	1,710,465

The Company held no securities classified as trading at December 31, 2012 or 2011.

The details for securities classified as available for sale with unrealized losses as of December 31, 2012 follow (in thousands):


Available for sale
	Losses < 12 months				Losses 12 months or >				Total
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
U.S. Treasury	$	—	$	—	$	—	$	—	$	—	$	—
U.S. government agencies		—		—		—		—		—		—
Municipal obligations		5,278		14		—		—		5,278		14
Mortgage-backed securities		57,752		14		1,097		7		58,849		21
CMOs		—		—		—		—		—		—
Corporate debt securities		—		—		—		—		—		—
Equity securities		268		2		2		2		270		4

	$	63,298	$	30	$	1,099	$	9	$	64,397	$	39

The details for securities classified as available for sale with unrealized losses as of December 31, 2011 follow (in thousands):


Available for sale
	Losses < 12 months				Losses 12 months or >				Total
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
U.S. Treasury	$	—	$	—	$	—	$	—	$	—	$	—
U.S. government agencies		—		—		—		—		—		—
Municipal obligations		18,854		42		—		—		18,854		42
Mortgage-backed securities		212,900		692		337		4		213,237		696
CMOs		296,860		2,193		—		—		296,860		2,193
Corporate debt securities		398		34		—		—		398		34
Equity securities		1,685		39		2		2		1,687		41

	$	530,697	$	3,000	$	339	$	6	$	531,036	$	3,006

The details for securities classified as held to maturity with unrealized losses as of December 31, 2012 follow (in thousands):


Held to maturity
	Losses < 12 months				Losses 12 months or >				Total
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
Municpal obligations	$	—	$	—	$	—	$	—	$	—	$	—
Mortgage-backed securities		—		—		—		—		—		—
CMOs		87,852		259		54,445		682		142,297		941

	$	87,852	$	259	$	54,445	$	682	$	142,297	$	941

Substantially all of the unrealized losses relate to changes in market rates on fixed-rate debt securities since the respective purchase date. In all cases, the indicated impairment would be recovered by the security’s maturity date or possibly earlier if the market price for the security increases with a reduction in the yield required by the market. None of the unrealized losses relate to the marketability of the securities or the issuer’s ability to meet contractual obligations. The Company has adequate liquidity and, therefore, does not plan to and, more likely than not, will not be required to sell these securities before recovery of the indicated impairment. Accordingly, the unrealized losses on these securities have been determined to be temporary.

Proceeds from sales of securities available for sale were approximately $48 million in 2012, $343 million in 2011 and less than $1 million in 2010. Realized gross gains and losses, computed through specific identification, were insignificant. Substantially all of the proceeds in 2011 came from the sale of a portion of the portfolio acquired in the Whitney acquisition.

Securities with carrying values totaling approximately $2.6 billion at December 31, 2012 and $3.0 billion at December 31, 2011 were pledged primarily to secure public deposits or sold under agreements to repurchase.