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Securities | 3 Months Ended
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Mar. 31, 2020
Investments, Debt and Equity Securities [Abstract] |
Securities | Securities The following tables present the amortized cost, gross unrealized gains and losses, and fair value by major categories of AFS debt securities as of March 31, 2020 and December 31, 2019:
($ in thousands) |  | March 31, 2020
| Amortized Cost (1) |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value
AFS debt securities: |  |  |  |  |  |  |  |
U.S. Treasury securities |  | $ | 50,606 |  |  | $ | 822 |  |  | $ | — |  |  | $ | 51,428 |
U.S. government agency and U.S. government-sponsored enterprise debt securities |  | 511,176 |  |  | 7,232 |  |  | — |  |  | 518,408 |
U.S. government agency and U.S. government-sponsored enterprise mortgage-backed securities: |  |  |  |  |  |  |  |
Commercial mortgage-backed securities |  | 677,644 |  |  | 24,472 |  |  | (4,168 | ) |  | 697,948 |
Residential mortgage-backed securities |  | 1,316,009 |  |  | 38,770 |  |  | (2,412 | ) |  | 1,352,367 |
Municipal securities |  | 300,551 |  |  | 10,147 |  |  | (1,072 | ) |  | 309,626 |
Non-agency mortgage-backed securities: |  |  |  |  |  |  |  |
Commercial mortgage-backed securities |  | 85,843 |  |  | 2,008 |  |  | (737 | ) |  | 87,114 |
Residential mortgage-backed securities |  | 64,112 |  |  | 156 |  |  | (2,134 | ) |  | 62,134 |
Corporate debt securities |  | 11,250 |  |  | 1 |  |  | (288 | ) |  | 10,963 |
Foreign bonds |  | 283,822 |  |  | 749 |  |  | (50 | ) |  | 284,521 |
Asset-backed securities |  | 65,400 |  |  | — |  |  | (3,844 | ) |  | 61,556 |
CLOs |  | 294,000 |  |  | — |  |  | (34,122 | ) |  | 259,878 |
Total AFS debt securities |  | $ | 3,660,413 |  |  | $ | 84,357 |  |  | $ | (48,827 | ) |  | $ | 3,695,943 |
($ in thousands) |  | December 31, 2019
| Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value
AFS debt securities: |  |  |  |  |  |  |  |
U.S. Treasury securities |  | $ | 177,215 |  |  | $ | — |  |  | $ | (793 | ) |  | $ | 176,422 |
U.S. government agency and U.S. government-sponsored enterprise debt securities |  | 584,275 |  |  | 1,377 |  |  | (4,407 | ) |  | 581,245 |
U.S. government agency and U.S. government-sponsored enterprise mortgage-backed securities: |  |  |  |  |  |  |  |  |
Commercial mortgage-backed securities |  | 599,814 |  |  | 8,551 |  |  | (4,894 | ) |  | 603,471 |
Residential mortgage-backed securities |  | 998,447 |  |  | 6,927 |  |  | (1,477 | ) |  | 1,003,897 |
Municipal securities |  | 101,621 |  |  | 790 |  |  | (109 | ) |  | 102,302 |
Non-agency mortgage-backed securities: |  |  |  |  |  |  |  |  |
Commercial mortgage-backed securities |  | 86,609 |  |  | 1,947 |  |  | (6 | ) |  | 88,550 |
Residential mortgage-backed securities |  | 46,830 |  |  | 3 |  |  | (285 | ) |  | 46,548 |
Corporate debt securities |  | 11,250 |  |  | 12 |  |  | (113 | ) |  | 11,149 |
Foreign bonds |  | 354,481 |  |  | 198 |  |  | (507 | ) |  | 354,172 |
Asset-backed securities |  | 66,106 |  |  | — |  |  | (1,354 | ) |  | 64,752 |
CLOs |  | 294,000 |  |  | — |  |  | (9,294 | ) |  | 284,706 |
Total AFS debt securities |  | $ | 3,320,648 |  |  | $ | 19,805 |  |  | $ | (23,239 | ) |  | $ | 3,317,214 |
As of March 31, 2020, the amortized cost of AFS debt securities excludes accrued interest receivable of $14.4 million which is included in Other assets on the Consolidated Balance Sheet. For our accounting policy related to AFS debt securities’ accrued interest receivable, see Note 2 — Summary of Significant Accounting Policies to the Consolidated Financial Statements in this Form 10-Q. Unrealized Losses The following tables present the fair value and the associated gross unrealized losses of the Company’s AFS debt securities, aggregated by investment category and the length of time that the securities have been in a continuous unrealized loss position as of March 31, 2020 and December 31, 2019.
($ in thousands) |  | March 31, 2020
| Less Than 12 Months |  | 12 Months or More |  | Total
| Fair Value |  | Gross Unrealized Losses |  | Fair Value |  | Gross Unrealized Losses |  | Fair Value |  | Gross Unrealized Losses
AFS debt securities: |  |  |  |  |  |  |  |  |  |  |  |
U.S. government agency and U.S. government-sponsored enterprise mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |
Commercial mortgage-backed securities |  | $ | 116,225 |  |  | $ | (2,277 | ) |  | $ | 19,252 |  |  | $ | (1,891 | ) |  | $ | 135,477 |  |  | $ | (4,168 | )
Residential mortgage-backed securities |  | 192,572 |  |  | (2,408 | ) |  | 193 |  |  | (4 | ) |  | 192,765 |  |  | (2,412 | )
Municipal securities |  | 18,705 |  |  | (1,072 | ) |  | — |  |  | — |  |  | 18,705 |  |  | (1,072 | )
Non-agency mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |
Commercial mortgage-backed securities |  | 31,087 |  |  | (737 | ) |  | — |  |  | — |  |  | 31,087 |  |  | (737 | )
Residential mortgage-backed securities |  | 47,044 |  |  | (2,134 | ) |  | — |  |  | — |  |  | 47,044 |  |  | (2,134 | )
Corporate debt securities |  | — |  |  | — |  |  | 9,713 |  |  | (288 | ) |  | 9,713 |  |  | (288 | )
Foreign bonds |  | 49,950 |  |  | (50 | ) |  | — |  |  | — |  |  | 49,950 |  |  | (50 | )
Asset-backed securities |  | 50,097 |  |  | (2,657 | ) |  | 11,459 |  |  | (1,187 | ) |  | 61,556 |  |  | (3,844 | )
CLOs |  | 259,878 |  |  | (34,122 | ) |  | — |  |  | — |  |  | 259,878 |  |  | (34,122 | )
Total AFS debt securities |  | $ | 765,558 |  |  | $ | (45,457 | ) |  | $ | 40,617 |  |  | $ | (3,370 | ) |  | $ | 806,175 |  |  | $ | (48,827 | )
($ in thousands) |  | December 31, 2019
| Less Than 12 Months |  | 12 Months or More |  | Total
| Fair Value |  | Gross Unrealized Losses |  | Fair Value |  | Gross Unrealized Losses |  | Fair Value |  | Gross Unrealized Losses
AFS debt securities: |  |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury securities |  | $ | — |  |  | $ | — |  |  | $ | 176,422 |  |  | $ | (793 | ) |  | $ | 176,422 |  |  | $ | (793 | )
U.S. government agency and U.S. government-sponsored enterprise debt securities |  | 310,349 |  |  | (4,407 | ) |  | — |  |  | — |  |  | 310,349 |  |  | (4,407 | )
U.S. government agency and U.S. government-sponsored enterprise mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |
Commercial mortgage-backed securities |  | 204,675 |  |  | (2,346 | ) |  | 108,314 |  |  | (2,548 | ) |  | 312,989 |  |  | (4,894 | )
Residential mortgage-backed securities |  | 325,354 |  |  | (1,234 | ) |  | 34,337 |  |  | (243 | ) |  | 359,691 |  |  | (1,477 | )
Municipal securities |  | 31,130 |  |  | (109 | ) |  | — |  |  | — |  |  | 31,130 |  |  | (109 | )
Non-agency mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |
Commercial mortgage-backed securities |  | 7,914 |  |  | (6 | ) |  | — |  |  | — |  |  | 7,914 |  |  | (6 | )
Residential mortgage-backed securities |  | 42,894 |  |  | (285 | ) |  | — |  |  | — |  |  | 42,894 |  |  | (285 | )
Corporate debt securities |  | — |  |  | — |  |  | 9,888 |  |  | (113 | ) |  | 9,888 |  |  | (113 | )
Foreign bonds |  | 129,074 |  |  | (407 | ) |  | 9,900 |  |  | (100 | ) |  | 138,974 |  |  | (507 | )
Asset-backed securities |  | 52,565 |  |  | (902 | ) |  | 12,187 |  |  | (452 | ) |  | 64,752 |  |  | (1,354 | )
CLOs |  | 284,706 |  |  | (9,294 | ) |  | — |  |  | — |  |  | 284,706 |  |  | (9,294 | )
Total AFS debt securities |  | $ | 1,388,661 |  |  | $ | (18,990 | ) |  | $ | 351,048 |  |  | $ | (4,249 | ) |  | $ | 1,739,709 |  |  | $ | (23,239 | )
Allowance for Credit Losses Each reporting period, the Company assesses each AFS debt security that is in an unrealized loss position to determine whether the decline in fair value below the amortized cost basis resulted from a credit loss or other factors. For a discussion of the factors and criteria the Company uses in analyzing securities for impairment related to credit losses, see Note 2 — Summary of Significant Accounting Policies — Allowance for Credit Losses on Available-For-Sale Debt Securities to the Consolidated Financial Statements in this Form 10-Q. Prior to January 1, 2020, the Company assessed individual securities that were in an unrealized loss position for OTTI. The gross unrealized losses across all major security types presented in the above tables were primarily attributable to yield curve movements and widened spreads arising from the negative outlook and uncertainty as a result of the COVID-19 pandemic. The Company believes that the credit support levels of the Company’s AFS debt securities are strong and, based on current assessments and macroeconomic forecasts, expects that full contractual cash flows will be received even if the credit performance deteriorates under the impact of the COVID-19 pandemic. As of March 31, 2020, the Company has the intent to hold the AFS debt securities with unrealized losses through the anticipated recovery period and it is more-likely-than-not that the Company will not have to sell these securities before recovery of their amortized cost. The issuers of these securities have not, to the Company’s knowledge, established any cause for default on these securities. As a result, the Company expects to recover the entire amortized cost basis of these securities. Accordingly, no allowance for credit losses as of March 31, 2020, nor provision for credit losses for the three months ended March 31, 2020 were recorded. In comparison, no OTTI credit loss was recognized for the three months ended March 31, 2019. As of March 31, 2020, the Company had 56 AFS debt securities in a gross unrealized loss position with no credit impairment, primarily consisting of three CLOs, 32 U.S. government agency and U.S. government-sponsored enterprise mortgage-backed securities, and four asset-backed securities. In comparison, as of December 31, 2019, the Company had 101 AFS debt securities in a gross unrealized loss position with no credit impairment, primarily consisting of three CLOs, 57 U.S. government agency and U.S. government-sponsored enterprise mortgage-backed securities, and 14 U.S. government agency and U.S. government-sponsored enterprise debt securities. Realized Gains and Losses The following table presents the proceeds, gross realized gains and tax expense related to the sales of AFS debt securities for the three months ended March 31, 2020 and 2019:
($ in thousands) |  | Three Months Ended March 31,
| 2020 |  | 2019
Proceeds from sales |  | $ | 306,463 |  |  | $ | 151,339 |
Gross realized gains |  | $ | 1,529 |  |  | $ | 1,561 |
Related tax expense |  | $ | 452 |  |  | $ | 461 |
Contractual Maturities of Available-for-Sale Debt Securities The following table presents the contractual maturities of AFS debt securities as of March 31, 2020:
($ in thousands) |  | Amortized Cost |  | Fair Value
Due within one year |  | $ | 588,392 |  |  | $ | 590,461 |
Due after one year through five years |  | 314,312 |  |  | 319,938 |
Due after five years through ten years |  | 240,566 |  |  | 252,057 |
Due after ten years |  | 2,517,143 |  |  | 2,533,487 |
Total AFS debt securities |  | $ | 3,660,413 |  |  | $ | 3,695,943 |
Actual maturities of mortgage-backed securities can differ from contractual maturities as the borrowers have the right to prepay obligations. In addition, factors such as prepayments and interest rates may affect the yields on the carrying values of mortgage-backed securities. As of March 31, 2020 and December 31, 2019, AFS debt securities with fair value of $742.4 million and $479.4 million, respectively, were pledged to secure public deposits, repurchase agreements and for other purposes required or permitted by law. Restricted Equity Securities The following table presents the restricted equity securities on the Consolidated Balance Sheet as of March 31, 2020 and December 31, 2019:
($ in thousands) |  | March 31, 2020 |  | December 31, 2019
Federal Reserve Bank of San Francisco (“FRB”) stock |  | $ | 58,563 |  |  | $ | 58,330 |
FHLB stock |  | 20,182 |  |  | 20,250 |
Total restricted equity securities |  | $ | 78,745 |  |  | $ | 78,580 |

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