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Securities
 12 Months Ended
Dec. 31, 2013
Investments, Debt and Equity Securities [Abstract]  
Securities
Securities

The following tables summarize the amortized costs and estimated fair values of AFS securities, as of the dates indicated:

 
Amortized Cost
 
Unrealized Gains
 
Unrealized Losses
 
Fair
Value
December 31, 2013:
  

 
  

 
  

 
  

Obligations of states and political subdivisions
$
30,143

 
$
1,075

 
$
(11
)
 
$
31,207

Mortgage-backed securities issued or guaranteed by U.S. government sponsored enterprises
397,409

 
5,528

 
(7,034
)
 
395,903

Collateralized mortgage obligations issued or guaranteed by U.S. government sponsored enterprises
385,847

 
912

 
(12,324
)
 
374,435

Private issue collateralized mortgage obligations
7,329

 
10

 
(407
)
 
6,932

Total available-for-sale securities
$
820,728

 
$
7,525

 
$
(19,776
)
 
$
808,477

December 31, 2012:
  

 
  

 
  

 
 

Obligations of states and political subdivisions
$
31,112

 
$
1,928

 
$
—

 
$
33,040

Mortgage-backed securities issued or guaranteed by U.S. government sponsored enterprises
345,528

 
12,699

 
(79
)
 
358,148

Collateralized mortgage obligations issued or guaranteed by U.S. government sponsored enterprises
375,627

 
6,181

 
(120
)
 
381,688

Private issue collateralized mortgage obligations
8,871

 
—

 
(697
)
 
8,174

Total available-for-sale securities
$
761,138

 
$
20,808

 
$
(896
)
 
$
781,050



At December 31, 2013, net unrealized losses on AFS securities included in AOCI amounted to $8.0 million, net of a deferred tax benefit of $4.3 million. At December 31, 2012, net unrealized gains on AFS securities included in AOCI amounted to $12.9 million, net of a deferred tax liability of $7.0 million.

Impaired Securities

Management periodically reviews the Company’s investment portfolio to determine the cause, magnitude and duration of declines in the fair value of each security. Thorough evaluations of the causes of the unrealized losses are performed to determine whether the impairment is temporary or other-than-temporary in nature. Considerations such as the ability of the securities to meet cash flow requirements, levels of credit enhancements, risk of curtailment, recoverability of invested amount over a reasonable period of time and the length of time the security is in a loss position, for example, are applied in determining OTTI. Once a decline in value is determined to be other-than-temporary, the value of the security is permanently reduced and a corresponding charge to earnings is recognized.

The following table presents the estimated fair values and gross unrealized losses of investment securities that were in a continuous loss position at December 31, 2013 and 2012, by length of time that individual securities in each category have been in a continuous loss position:

 
Less Than 12 Months
 
12 Months or More
 
Total
  
Fair Value
 
Unrealized Losses
 
Fair Value
 
Unrealized Losses
 
Fair Value
 
Unrealized Losses
December 31, 2013:
  

 
  

 
  

 
  

 
  

 
  

Obligations of states and political subdivisions
$
2,143

 
$
(11
)
 
$
—

 
$
—

 
$
2,143

 
$
(11
)
Mortgage-backed securities issued or guaranteed by U.S. government sponsored enterprises
145,424

 
(4,189
)
 
43,915

 
(2,845
)
 
189,339

 
(7,034
)
Collateralized mortgage obligations issued or guaranteed by U.S. government sponsored enterprises
239,278

 
(7,738
)
 
73,376

 
(4,586
)
 
312,654

 
(12,324
)
Private issue collateralized mortgage obligations
122

 
(4
)
 
4,945

 
(403
)
 
5,067

 
(407
)
Total
$
386,967

 
$
(11,942
)
 
$
122,236

 
$
(7,834
)
 
$
509,203

 
$
(19,776
)
December 31, 2012:
  

 
  

 
  

 
  

 
  

 
  

Mortgage-backed securities issued or guaranteed by U.S. government sponsored enterprises
$
42,782

 
$
(79
)
 
$
—

 
$
—

 
$
42,782

 
$
(79
)
Collateralized mortgage obligations issued or guaranteed by U.S. government sponsored enterprises
73,098

 
(120
)
 
—

 
—

 
73,098

 
(120
)
Private issue collateralized mortgage obligations
—

 
—

 
8,174

 
(697
)
 
8,174

 
(697
)
Total
$
115,880

 
$
(199
)
 
$
8,174

 
$
(697
)
 
$
124,054

 
$
(896
)


At December 31, 2013, the Company held 93 investment securities with a fair value of $509.2 million with unrealized losses totaling $19.8 million that are considered temporary. Of these, 27 investment securities with a fair value of $122.2 million have been an unrealized loss position for 12 months or more. The decline in the fair value of the securities is reflective of an increase in interest rates during 2013 and is not indicative of an overall credit deterioration or other factors with the Company's investment securities portfolio. Specifically, included in the unrealized losses were Non-Agencies with a fair value of $5.1 million and unrealized losses of $407,000. The Company's management believes the unrealized losses for the Non-Agencies are the result of current market illiquidity and the underestimation of value in the market. Management currently has the intent and ability to retain these investment securities with unrealized losses until the decline in value has recovered. Stress tests are performed regularly on the higher risk bonds in the Company's investment portfolio using current statistical data to determine expected cash flows and forecast potential losses. The results of the stress tests throughout 2013 including at December 31, 2013, indicated that no OTTI write-downs were necessary during 2013.

At December 31, 2012, $124.1 million of the Company’s investment securities had unrealized losses that were primarily considered temporary. A large portion of the unrealized loss was related to the Non-Agencies, which includes $7.5 million that have been downgraded to non-investment grade. Including the Non-Agencies, there were 11 securities with a fair value of $8.2 million in the portfolio which had unrealized losses for twelve months or longer. The results of the stress tests during 2012, including at December 31, 2012, indicated potential future credit losses in the most likely scenario on two securities for which the Company recorded $39,000 in OTTI write-downs during 2012.

Security Gains and Losses and OTTI of Securities

The following table details the Company’s sales of AFS investment securities, the gross realized gains and losses, and OTTI of securities:

 
Years Ended December 31,
  
2013
 
2012
 
2011
Proceeds from sales of securities
$
17,613

 
$
115,493

 
$
54,600

Gross realized gains
785

 
2,826

 
2,258

Gross realized losses
—

 
(289
)
 
(73
)
OTTI
—

 
(39
)
 
(109
)


During 2013, the Company sold certain investment securities with a total carrying value of $16.8 million in order to manage its liquidity and interest rate risk. The securities that were sold were primarily selected based on an assessment of their prepayment speed.

During 2012, the Company sold certain investment securities with a total carrying value of $113.0 million in order to manage its liquidity and interest rate risk. The securities that were sold were primarily selected based on an assessment of their prepayment speed. One Non-Agency investment security, which had previously recorded $176,000 in OTTI, was sold due to the recent deterioration in its credit quality.

During 2011, the Company sold 16 municipal bonds totaling $7.3 million that the Company was monitoring that either had below “A” ratings, split ratings, withdrawn ratings, negative outlooks or were revenue bonds. Due to continued pressure on state and local government revenues around the country as municipalities struggle with a weak economy, management decided to sell these securities. The Company also sold one $10.2 million agency security, 31 pass through securities totaling $29.3 million, and three Non-Agencies totaling $7.8 million. The Company had not recorded any OTTI on these securities; however, it did record OTTI of $109,000 on two Non-Agency investment securities as the stress tests performed indicated potential future credit losses.

Securities Pledged

At December 31, 2013 and 2012, securities with an amortized cost of $479.2 million and $465.0 million, respectively, and estimated fair values of $474.7 million and $482.4 million, respectively, were pledged to secure FHLBB advances, public deposits, and securities sold under agreements to repurchase, and for other purposes required or permitted by law.

Contractual Maturities

The amortized cost and estimated fair values of AFS debt securities by contractual maturity at December 31, 2013 are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

 
Amortized Cost
 
Fair
Value
Due in one year or less
$
1,654

 
$
1,667

Due after one year through five years
29,753

 
30,433

Due after five years through ten years
155,014

 
155,315

Due after ten years
634,307

 
621,062

  
$
820,728

 
$
808,477