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December 31, 2010
<br />Less Than 12 Months 12 Months or More Total
<br />Unrealized Fair Unrealized Fair Unrealized Fair
<br />(dollars in thousands) Losses Value Losses Value Losses Value
<br />U.S. Treasury and other U.S. Government
<br />agencies and corporations $ (75) $ 90,839 $ (1) $ 330 $ (76) $ 91,169
<br />Government sponsored agencies (1,039) 330,445 - (1,039) 330,445
<br />Mortgage and asset -backed securities:
<br />Government agencies") (1,069) 189,008 (47) 890 (1,116) 189,898
<br />Government sponsored agencies"' (329) 97,620 (329) 97,620
<br />Collateralized debt obligations (60,682) 66,992 (60,682) 66,992
<br />Collateralized loan obligations (93,484) 129,906 (93,484) 129,906
<br />Other asset -backed securities (924) 3,492 (924) 3,492
<br />Collateralized mortgage obligations:
<br />Government agencies (828) 141,128 - (828) 141,128
<br />Government sponsored agencies (19,699) 695,627 - (19,699) 695,627
<br />State and political subdivisions (27,740) 550,576 (17,849) 165,041 (45,589) 715,617
<br />Equity securities (270) 5,957 (270) 5,957
<br />Total securities available for sale $(50,779) $2,095,243 $(173,257) $372,608 $(224,036) $2,467,851
<br />"D Backed by residential real estate.
<br />For the securities in the above tables, at year-end we did not have the intent to sell and determined it
<br />was more likely than not that we would not be required to sell the securities prior to recovery of the
<br />amortized cost basis. We have also assessed each of the securities in the above tables for credit impairment.
<br />We frequently monitor the credit ratings of individual investments within our portfolio and believe that the
<br />majority of our unrealized loss positions are due to changes in interest rates and illiquidity within the
<br />markets. The Bank may occasionally sell securities at a loss when it decides to restructure portions of the
<br />portfolio due to changing market conditions. For equity securities, we consider numerous factors in
<br />determining whether impairment exists, including our intent and ability to hold the securities for a period
<br />of time sufficient to recover the securities' cost basis.
<br />The following is a description of our security categories, including a description of the nature of the
<br />unrealized losses and other -than -temporary impairment ("OTTI") losses within our portfolio:
<br />U.S. Treasury and other U.S. Government agencies and corporations
<br />The unrealized losses associated with United States ("U.S.") Treasury and federal agency securities
<br />are driven primarily by changes in interest rates. We do not estimate any credit losses due to guarantees
<br />provided by the U.S. Government.
<br />Government sponsored agencies
<br />The unrealized losses associated with U.S. Government sponsored agencies are driven primarily by
<br />changes in interest rates. We do not estimate any credit losses due to backing provided by the United States
<br />Government.
<br />Mortgage and asset -backed securities:
<br />Government agencies and government sponsored agencies
<br />The unrealized losses associated with federal agency mortgage -backed securities are primarily driven
<br />by changes in interest rates. These securities are issued by U.S. Government or government sponsored
<br />entities and do not have any expected credit losses given government guarantees.
<br />Collateralized debt obligations
<br />The unrealized losses associated with collateralized debt obligations for securities backed by trust
<br />preferred hybrid capital issued by other financial institutions are driven primarily by changes in interest
<br />rates and market illiquidity. We estimate credit impairment using a cash flow model that incorporates
<br />default rates, loss severities and prepayment rates.
<br />-17-
<br />2011 Bank of the West Annual Report
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