Note 5 — Investment Securities

The following is the amortized cost and fair value of investment securities held to maturity:


			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
(Dollars in thousands)	Cost		Gains		Losses		Value
September 30, 2018:
State and municipal obligations	$	500	$	—	$	—	$	500
December 31, 2017:
State and municipal obligations	$	2,529	$	27	$	—	$	2,556
September 30, 2017:
State and municipal obligations	$	3,678	$	54	$	—	$	3,732

The following is the amortized cost and fair value of investment securities available for sale:


			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
(Dollars in thousands)	Cost		Gains		Losses		Value
September 30, 2018:
Government-sponsored entities debt*	$	54,397	$	—	$	(1,852)	$	52,545
State and municipal obligations		207,723		1,114		(2,613)		206,224
Mortgage-backed securities**		1,336,778		115		(44,381)		1,292,512
	$	1,598,898	$	1,229	$	(48,846)	$	1,551,281
December 31, 2017:
Government-sponsored entities debt*	$	86,535	$	51	$	(1,077)	$	85,509
State and municipal obligations		216,812		3,749		(124)		220,437
Mortgage-backed securities**		1,350,200		2,103		(11,616)		1,340,687
Corporate securities		1,560		—		—		1,560
	$	1,655,107	$	5,903	$	(12,817)	$	1,648,193
September 30, 2017:
Government-sponsored entities debt*	$	86,521	$	72	$	(642)	$	85,951
State and municipal obligations		199,898		4,584		(188)		204,294
Mortgage-backed securities**		1,027,827		4,673		(5,023)		1,027,477
Corporate stocks		1,556		176		—		1,732
	$	1,315,802	$	9,505	$	(5,853)	$	1,319,454

* - The Company’s government-sponsored entities holdings are comprised of debt securities offered by Federal Home Loan Mortgage Corporation (“FHLMC”) or Freddie Mac, Federal National Mortgage Association (“FNMA”) or Fannie Mae, FHLB, and Federal Farm Credit Banks (“FFCB”).

** - All of the mortgage-backed securities are issued by government-sponsored entities; there are no private-label holdings. Also, included in the Company’s mortgage-backed securities are debt securities offered by the Small Business Administration (“SBA”), which have the full faith and credit backing of the United States Government.

The following is the amortized cost and fair value of other investment securities:


			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
(Dollars in thousands)	Cost		Gains		Losses		Value
September 30, 2018:
Federal Home Loan Bank stock	$	13,149	$	—	$	—	$	13,149
Investment in unconsolidated subsidiaries		3,563		—		—		3,563
Other nonmarketable investment securities		2,517		—		—		2,517
	$	19,229	$	—	$	—	$	19,229
December 31, 2017:
Federal Home Loan Bank stock	$	16,967	$	—	$	—	$	16,967
Investment in unconsolidated subsidiaries		3,563		—		—		3,563
Other nonmarketable investment securities		2,517		—		—		2,517
	$	23,047	$	—	$	—	$	23,047
September 30, 2017:
Federal Home Loan Bank stock	$	10,177	$	—	$	—	$	10,177
Investment in unconsolidated subsidiaries		2,262		—		—		2,262
Other nonmarketable investment securities		1,225		—		—		1,225
	$	13,664	$	—	$	—	$	13,664

The amortized cost and fair value of debt securities at September 30, 2018 by contractual maturity are detailed below. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without prepayment penalties.


	Securities				Securities
	Held to Maturity				Available for Sale
	Amortized		Fair		Amortized		Fair
(Dollars in thousands)	Cost		Value		Cost		Value
Due in one year or less	$	—	$	—	$	4,366	$	4,362
Due after one year through five years		—		—		84,160		83,239
Due after five years through ten years		500		500		377,504		366,790
Due after ten years		—		—		1,132,868		1,096,890
	$	500	$	500	$	1,598,898	$	1,551,281

Information pertaining to the Company’s securities with gross unrealized losses at September 30, 2018, December 31, 2017 and September 30, 2017, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position is as follows:


	Less Than				Twelve Months
	Twelve Months				or More
	Gross				Gross
	Unrealized		Fair		Unrealized		Fair
(Dollars in thousands)	Losses		Value		Losses		Value
September 30, 2018:
Securities Available for Sale
Government-sponsored entities debt	$	538	$	20,253	$	1,314	$	32,293
State and municipal obligations		2,313		89,908		300		8,104
Mortgage-backed securities		25,077		876,430		19,304		389,045
Corporate securities		—		—		—		—
	$	27,928	$	986,591	$	20,918	$	429,442
December 31, 2017:
Securities Available for Sale
Government-sponsored entities debt	$	403	$	27,442	$	674	$	52,324
State and municipal obligations		124		17,400		—		—
Mortgage-backed securities		4,493		610,051		7,123		322,258
Corporate securities		—		—		—		—
	$	5,020	$	654,893	$	7,797	$	374,582
September 30, 2017:
Securities Available for Sale
Government-sponsored entities debt	$	473	$	68,366	$	169	$	11,830
State and municipal obligations		188		21,851		—		—
Mortgage-backed securities		4,457		455,145		566		35,917
Corporate stocks		—		—		—		—
	$	5,118	$	545,362	$	735	$	47,747

Management evaluates securities for other-than-temporary impairment (“OTTI”) on at least a quarterly basis, and more frequently when economic or market concerns warrant such evaluation. Consideration is given to (1) the financial condition and near-term prospects of the issuer, (2) the outlook for receiving the contractual cash flows of the investments, (3) the length of time and the extent to which the fair value has been less than cost, (4) the intent and ability of the Company to retain its investment in the issuer for a period of time sufficient to allow for any anticipated recovery in fair value or for a debt security whether it is more-likely-than-not that the Company will be required to sell the debt security prior to recovering its fair value, and (5) the anticipated outlook for changes in the general level of interest rates. All debt securities available for sale in an unrealized loss position as of September 30, 2018 continue to perform as scheduled. As part of the Company’s evaluation of its intent and ability to hold investments for a period of time sufficient to allow for any anticipated recovery in the market, the Company considers its investment strategy, cash flow needs, liquidity position, capital adequacy and interest rate risk position. The Company does not currently intend to sell the securities within the portfolio and it is not more-likely-than-not that the Company will be required to sell the debt securities; therefore, management does not consider these investments to be other-than-temporarily impaired at September 30, 2018.

Management continues to monitor all of the Company’s securities with a high degree of scrutiny. There can be no assurance that the Company will not conclude in future periods that conditions existing at that time indicate some or all of its securities may be sold or are other than temporarily impaired, which would require a charge to earnings in such periods.