INVESTMENTS

The amortized cost and fair value of investment securities classified as available for sale and held to maturity at December 31, 2014 and 2013, were as follows:



	December 31, 2014
(Dollars in thousands)	Cost		Gross unrealized gains		Gross unrealized losses		Fair value
Investment securities available for sale
U.S. Treasury	$	2,626,900	$	2,922	$	152	$	2,629,670
Government agency	908,362		702		247		908,817
Mortgage-backed securities	3,628,187		16,964		11,847		3,633,304
Municipal securities	125		1		—		126
Total investment securities available for sale	$	7,163,574	$	20,589	$	12,246	$	7,171,917

	December 31, 2013
	Cost		Gross unrealized gains		Gross unrealized losses		Fair value
U.S. Treasury	$	373,223	$	259	$	45	$	373,437
Government agency	2,543,223		1,798		792		2,544,229
Mortgage-backed securities	2,486,297		4,526		43,950		2,446,873
Equity securities	543		21,604		—		22,147
Municipal securities	186		1		—		187
Other	863		—		33		830
Total investment securities available for sale	$	5,404,335	$	28,188	$	44,820	$	5,387,703

	December 31, 2014
	Cost		Gross unrealized gains		Gross unrealized losses		Fair value
Investment securities held to maturity
Mortgage-backed securities	$	518	$	26	$	—	$	544

	December 31, 2013
	Cost		Gross unrealized gains		Gross unrealized losses		Fair value
Mortgage-backed securities	$	907	$	67	$	—	$	974

As of December 31, 2013, equity securities included an investment in Bancorporation stock of $21.6 million. Pursuant to the Merger Agreement, the shares of capital stock of Bancorporation held were canceled and ceased to exist when the merger became effective October 1, 2014. Also, a single subordinated debt security, previously classified within Other at December 31, 2013, was called during the second quarter of 2014.

Investments in mortgage-backed securities primarily represent securities issued by the Government National Mortgage Association, Federal National Mortgage Association and Federal Home Loan Mortgage Corporation. The following table provides the amortized cost and fair value by contractual maturity. Expected maturities will differ from contractual maturities on certain securities because borrowers and issuers may have the right to call or prepay obligations with or without prepayment penalties. Repayments of mortgage-backed securities are dependent on the repayments of the underlying loan balances. Equity securities do not have a stated maturity date.



	December 31, 2014				December 31, 2013
(Dollars in thousands)	Cost		Fair value		Cost		Fair value
Investment securities available for sale
Non-amortizing securities maturing in:
One year or less	$	447,866	$	447,992	$	839,956	$	840,883
One through five years	3,087,521		3,090,621		2,077,539		2,077,800
Mortgage-backed securities	3,628,187		3,633,304		2,486,297		2,446,873
Equity securities	—		—		543		22,147
Total investment securities available for sale	$	7,163,574	$	7,171,917	$	5,404,335	$	5,387,703
Investment securities held to maturity
Mortgage-backed securities held to maturity	$	518	$	544	$	907	$	974

For each period presented, securities gains (losses) include the following:



	Year ended December 31
(Dollars in thousands)	2014			2013		2012
Gross gains on retirement/sales of investment securities available for sale	$	29,129		$	—	$	2,324
Gross losses on sales of investment securities available for sale	(33		)	—		(2		)
Other than temporary impairment loss on equity securities	—			—		(45		)
Total securities gains	$	29,096		$	—	$	2,277

The following table provides information regarding securities with unrealized losses as of December 31, 2014 and 2013.



	December 31, 2014
	Less than 12 months				12 months or more				Total
(Dollars in thousands)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Investment securities available for sale:
U.S. Treasury	$	338,612	$	151	$	1,015	$	1	$	339,627	$	152
Government agency	261,288		247		—		—		261,288		247
Mortgage-backed securities	573,374		1,805		831,405		10,042		1,404,779		11,847
Total	$	1,173,274	$	2,203	$	832,420	$	10,043	$	2,005,694	$	12,246

	December 31, 2013
	Less than 12 months				12 months or more				Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Investment securities available for sale:
U.S. Treasury	$	102,105	$	45	$	—	$	—	$	102,105	$	45
Government agency	780,552		761		29,969		31		810,521		792
Mortgage-backed securities	2,221,213		42,876		26,861		1,074		2,248,074		43,950
Other	830		33		—		—		830		33
Total	$	3,104,700	$	43,715	$	56,830	$	1,105	$	3,161,530	$	44,820

Investment securities with an aggregate fair value of $832.4 million have had continuous unrealized losses for more than 12 months as of December 31, 2014 with an aggregate unrealized loss of $10.0 million. As of December 31, 2014, all 86 of these investments are U.S. Treasury and government sponsored enterprise-issued mortgage-backed securities. None of the unrealized losses identified as of December 31, 2014 or December 31, 2013 relate to the marketability of the securities or the issuer’s ability to honor redemption obligations. For all periods presented, BancShares had the ability and intent to retain these securities for a period of time sufficient to recover all unrealized losses. Therefore, none of the securities were deemed to be other than temporarily impaired.

Investment securities having an aggregate carrying value of $4.37 billion at December 31, 2014 and $2.75 billion at December 31, 2013 were pledged as collateral to secure public funds on deposit and certain short-term borrowings, and for other purposes as required by law.