INVESTMENT SECURITIES

3 Months Ended

Dec. 31, 2012

Investments, Debt and Equity Securities [Abstract]

INVESTMENT SECURITIES

INVESTMENT SECURITIES

Components of investment securities are as follows (in thousands):

	December 31, 2012		September 30, 2012
Available-for-sale securities	$	5,211	$	3,966
Trading securities	5,365		3,064
Total investment securities, at fair value	$	10,576	$	7,030

Available-for-sale securities.  The following table discloses the pre-tax unrealized gains relating to the Company’s investments in available-for-sale securities (in thousands):

	Cost or Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
December 31, 2012:
Equity securities	$	109	$	100	—			$	209
CLO securities	3,712		1,290		—			5,002
Total	$	3,821	$	1,390	$	—		$	5,211
September 30, 2012
Equity securities	$	109	$	86	—			$	195
CLO securities	2,484		1,302		(15		)	3,771
Total	$	2,593	$	1,388	$	(15	)	$	3,966

Equity securities.  The Company holds 18,972 shares of The Bancorp, Inc. ("TBBK") common stock.

CLO securities.  The collateralized loan obligation ("CLO") securities represent the Company’s retained equity interest in five and four CLO issuers that it directly and/or through its joint venture has structured and managed at December 31, 2012 and September 30, 2012, respectively.  The fair value of these retained interests is impacted by the fair value of the investments held by the respective CLO issuers, which are sensitive to interest rate fluctuations and credit quality determinations. The Company is required to maintain a minimum investment of $2.0 million (par value) in the subordinated notes of one of the CLO issuers, Apidos CLO II.

Trading securities.  The Company began purchasing investment securities classified as trading securities during fiscal 2012. For the three months ended December 31, 2012, the Company had net unrealized gains on these securities totaling $164,000 and realized gains from sales of trading securities of $307,000 which were included in Financial Fund Management Revenues on the consolidated statements of operations.

During the three months ended December 31, 2011, the Company sold 26,517 shares of TBBK stock held in a Rabbi Trust for the Supplemental Employment Retirement Plan ("SERP") for its former Chief Executive Officer and recognized net gains of $17,000. The Company held 6,992 shares of TBBK common stock valued at $50,000 as of December 31, 2011 which were all subsequently sold during 2012.  

Unrealized losses along with the related fair value and aggregated by the length of time the investments were in a continuous unrealized loss position, are as follows (in thousands, except number of securities):

	Less than 12 Months						More than 12 Months
	Fair Value		Unrealized Losses			Number of Securities	Fair Value		Unrealized Losses		Number of Securities
September 30, 2012
CLO securities	$	1,274	$	(15	)	1	$	—	$	—	—