Note 4 - Securities

12 Months Ended

Dec. 31, 2014

Investments, Debt and Equity Securities [Abstract]

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

(4) Securities

The amortized cost, unrealized gains and losses, and fair value of securities available-for-sale follow:

(in thousands)	Amortized		Unrealized
December 31, 2015	cost		Gains		Losses		Fair value
U.S. Treasury and other U.S. government obligations	$	79,999	$	1	$	-	$	80,000
Government sponsored enterprise obligations		251,190		1,468		765		251,893
Mortgage-backed securities - government agencies		170,139		1,143		1,654		169,628
Obligations of states and political subdivisions		62,410		1,342		50		63,702
Corporate equity securities		653		-		-		653
Total securities available-for-sale	$	564,391	$	3,954	$	2,469	$	565,876

(in thousands)	Amortized		Unrealized
December 31, 2014	cost		Gains		Losses		Fair value
U.S. Treasury and other U.S. government obligations	$	70,000	$	-	$	-	$	70,000
Government sponsored enterprise obligations		203,531		2,017		562		204,986
Mortgage-backed securities - government agencies		173,573		2,042		1,345		174,270
Obligations of states and political subdivisions		61,416		1,560		142		62,834
Corporate equity securities		756		210		-		966
Total securities available-for-sale	$	509,276	$	5,829	$	2,049	$	513,056

 There were no securities held-to-maturity as of December 31, 2015 or 2014. 

Corporate equity securities, included in the available-for-sale portfolio at December 31, 2015 and 2014, consisted of common stock in a publicly-traded small business investment company.

In 2015, Bancorp sold securities with total fair market value of $5.9 million, generating no gain or loss. These securities consisted of agency and mortgage-backed securities with small remaining balances and agency securities. In 2014, Bancorp sold securities with total fair market value of $7.7 million, generating a net loss of $9 thousand. These securities consisted of mortgage-backed securities with small remaining balances, obligations of state and political subdivisions, and agency securities. In 2013, Bancorp sold obligations of state and political subdivisions with total fair market value of $696 thousand, generating a loss of $5 thousand. These sales were made in the ordinary course of portfolio management. Management has the intent and ability to hold all remaining investment securities available-for-sale for the foreseeable future.

A summary of the available-for-sale investment securities by maturity groupings as of December 31, 2015 is shown below.

(in thousands)
Securities available-for-sale		Amortized cost		Fair value
Due within 1 year	$	121,784	$	121,877
Due after 1 but within 5 years		141,714		142,875
Due after 5 but within 10 years		21,610		21,810
Due after 10 years		108,491		109,033
Corporate equity securities		653		653
Mortgage-backed securities - government agencies		170,139		169,628
Total securities available for sale	$	564,391	$	565,876

Actual maturities may differ from contractual maturities because some issuers have the right to call or prepay obligations. In addition to equity securities, the investment portfolio includes agency mortgage-backed securities, which are guaranteed by agencies such as the FHLMC, FNMA, and GNMA. These securities differ from traditional debt securities primarily in that they may have uncertain principal payment dates and are priced based on estimated prepayment rates on the underlying collateral.

Securities with a carrying value of approximately $380.7 million at December 31, 2015 and $263.1 million at December 31, 2014 were pledged to secure accounts of commercial depositors in cash management accounts, public deposits, and cash balances for certain investment management and trust accounts.

At year end 2015 and 2014, there were no holdings of securities of any one issuer, other than the U.S. Government and its agencies, in an amount greater than 10% of stockholders’ equity. 

Securities with unrealized losses not recognized in the statements of income are as follows:

(in thousands)	Less than 12 months				12 months or more				Total
December 31, 2015	Fair value		Unrealized losses		Fair value		Unrealized  losses		Fair  value		Unrealized losses
Government sponsored enterprise obligations	$	102,098	$	500	$	8,469	$	265	$	110,567	$	765
Mortgage-backed securities - government agencies		49,774		662		29,936		992		79,710		1,654
Obligations of states and political subdivisions		13,225		31		1,955		19		15,180		50
Total temporarily impaired securities	$	165,097	$	1,193	$	40,360	$	1,276	$	205,457	$	2,469
December 31, 2014
Government sponsored enterprise obligations	$	36,979	$	30	$	26,848	$	532	$	63,827	$	562
Mortgage-backed securities - government agencies		4,038		77		49,325		1,268		53,363		1,345
Obligations of states and political subdivisions		12,655		67		6,297		75		18,952		142
Total temporarily impaired securities	$	53,672	$	174	$	82,470	$	1,875	$	136,142	$	2,049

The applicable dates for determining when securities are in an unrealized loss position are December 31, 2015 and 2014. As such, it is possible that a security had a market value lower than its amortized cost on other days during the past twelve months, but is not in the “Investments with an unrealized loss of less than 12 months” category above.

At December 31, 2015, Bancorp recorded an other-than-temporary impairment charge of $103,000, in other non-interest expense, on the corporate equity security. This security, the only equity security in available-for-sale securities, exhibited characteristics which indicated the fair value was not likely to recover to a level equal to its carrying value within a reasonable period of time.

Unrealized losses on Bancorp’s remaining investment securities portfolio have not been recognized as expense because the securities are of high credit quality, and the decline in fair values is largely due to changes in the prevailing interest rate environment since the purchase date. Fair value is expected to recover as securities reach their maturity date and/or the interest rate environment returns to conditions similar to when these securities were purchased. These investments consist of 70 and 80 separate investment positions as of December 31, 2015 and 2014, respectively. Because management does not intend to sell the investments, and it is not likely that Bancorp will be required to sell the investments before recovery of their amortized cost bases, which may be maturity, Bancorp does not consider these securities to be other-than-temporarily impaired at December 31, 2015.

FHLB stock and other securities are investments held by Bancorp which are not readily marketable and are carried at cost. This category includes holdings of Federal Home Loan Bank of Cincinnati (“FHLB”) stock which are required for access to FHLB borrowing, and are classified as restricted securities.