Navy Federal Credit Union 2015 Annual Report Download - page 35

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Navy Federal Credit Union16
December 31, 2014
(dollars in thousands) Amortized Cost Fair Value
Held-to-maturity securities
Due in one year or less $ 49,933 $ 50,383
Due after one year through five years 263,899 264,159
Due after five years through ten years 53,424 53,849
Due after ten years 1,828 1,834
Total held-to-maturity securities 369,084 370,225
Available-for-sale debt securities
Due in one year or less 572,988 578,770
Due after one year through five years 3,825,411 3,891,202
Due after five years through ten years 2,274,440 2,316,338
Due after ten years 6,149,041 6,188,867
Total available-for-sale debt securities 12,821,880 12,975,177
Total debt securities $ 13,190,964 $ 13,345,402
Navy Federal held $642.8 million of stock in the Federal Home Loan Bank (FHLB) of Atlanta as
of December 31, 2015. Navy Federal held $462.9 million of stock in the FHLB of Atlanta and
San Francisco as of December 31, 2014. FHLB stock is a restricted investment carried at cost
and evaluated for impairment. As a member of the FHLB system, Navy Federal has access to
a $17.6 billion line of credit facility.
All securities in an unrealized loss position were reviewed individually to determine whether
those losses were caused by an other-than-temporary decline in fair value. Navy Federal makes
a determination of whether unrealized losses are other-than-temporary based on the following
factors: whether Navy Federal intends to sell or hold the security until its costs can be recovered,
the nature of the security, the portion of unrealized losses that are attributable to credit losses
and the financial condition of the issuer of the security. Navy Federal does not intend to sell nor
would Navy Federal be, more likely than not, required to sell these securities before recovering
its amortized cost basis. The unrealized losses associated with these investments are not a result
of a change in the credit quality of the issuer; rather, the losses are reflective of changing market
interest rates. Therefore, Navy Federal expects to recover the entire cost basis of these securities.
Navy Federal held 183 and 108 AFS securities in an unrealized loss position at December 31, 2015
and 2014, respectively. Navy Federal held one HTM security in an unrealized loss position at
December 31, 2015 and December 31, 2014. The following tables present these investments
at fair value and their associated gross unrealized losses broken down by the amount of time
the investments have been in a loss position: