Investment Securities

12 Months Ended

Dec. 31, 2024

Investments, Debt and Equity Securities [Abstract]

The amortized cost and estimated fair value of investment securities that are classified as available-for-sale and held-to-maturity are as follows:


	December 31, 2024
	Available-for-Sale
	Amortized Cost		Allowance for Credit Losses		Net Carrying Amount		Gross Unrealized Gains		Gross Unrealized (Losses)		Estimated Fair Value
	(In thousands)
U.S. government-sponsored enterprises	$	297,698	$	—	$	297,698	$	1,164	$	(14,072)	$	284,790
U.S. government-sponsored mortgage-backed securities	1,527,463		—		1,527,463		760		(203,539)		1,324,684
Private mortgage-backed securities	184,643		—		184,643		—		(13,249)		171,394
Non-government-sponsored asset backed securities	228,751		—		228,751		331		(3,434)		225,648
State and political subdivisions	956,055		—		956,055		335		(86,029)		870,361
Other securities	215,662		(2,195)		213,467		576		(18,281)		195,762
Total	$	3,410,272	$	(2,195)	$	3,408,077	$	3,166	$	(338,604)	$	3,072,639


	December 31, 2024
	Held-to-Maturity
	Amortized Cost		Allowance for Credit Losses		Net Carrying Amount		Gross Unrealized Gains		Gross Unrealized (Losses)		Estimated Fair Value
	(In thousands)
U.S. government-sponsored enterprises	$	43,560	$	—	$	43,560	$	—	$	(3,021)	$	40,539
U.S. government-sponsored mortgage-backed securities	124,169		—		124,169		—		(6,695)		117,474
State and political subdivisions	1,109,480		(2,005)		1,107,475		39		(122,587)		984,927

Total	$	1,277,209	$	(2,005)	$	1,275,204	$	39	$	(132,303)	$	1,142,940


	December 31, 2023
	Available-for-Sale
	Amortized Cost		Allowance for Credit Losses		Net Carrying Amount		Gross Unrealized Gains		Gross Unrealized (Losses)		Estimated Fair Value
	(In thousands)
U.S. government-sponsored enterprises	$	361,494	$	—	$	361,494	$	2,247	$	(17,093)	$	346,648
U.S. government-sponsored mortgage-backed securities	1,711,668		—		1,711,668		310		(191,557)		1,520,421
Private mortgage-backed securities	191,522		—		191,522		—		(16,117)		175,405
Non-government-sponsored asset backed securities	370,203		—		370,203		821		(7,551)		363,473
State and political subdivisions	990,318		—		990,318		1,938		(75,931)		916,325
Other securities	215,722		(2,525)		213,197		402		(28,030)		185,569
Total	$	3,840,927	$	(2,525)	$	3,838,402	$	5,718	$	(336,279)	$	3,507,841


	December 31, 2023
	Held-to-Maturity
	Amortized Cost		Allowance for Credit Losses		Net Carrying Amount		Gross Unrealized Gains		Gross Unrealized (Losses)		Estimated Fair Value
	(In thousands)
U.S. government-sponsored enterprises	$	43,285	$	—	$	43,285	$	—	$	(2,607)	$	40,678
U.S. government-sponsored mortgage-backed securities	130,278		—		130,278		106		(4,362)		126,022
State and political subdivisions	1,110,424		(2,005)		1,108,419		456		(105,094)		1,003,781

Total	$	1,283,987	$	(2,005)	$	1,281,982	$	562	$	(112,063)	$	1,170,481

Assets, principally investment securities, having a fair value of approximately $2.61 billion and $3.57 billion at December 31, 2024 and 2023, respectively, were pledged to secure public deposits and for other purposes required or permitted by law. Also, investment securities pledged as collateral for repurchase agreements totaled approximately $162.4 million and $142.1 million at December 31, 2024 and 2023, respectively.

The amortized cost and estimated fair value of securities classified as available-for-sale and held-to-maturity at December 31, 2024, by contractual maturity, are shown below. Expected maturities could differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately.


	Available-for-Sale				Held-to-Maturity
	Amortized Cost		Estimated Fair Value		Amortized Cost		Estimated Fair Value
	(In thousands)
Due in one year or less	$	17,732	$	17,486	$	—	$	—
Due after one year through five years	274,948		259,238		55,827		52,805
Due after five years through ten years	364,443		332,408		366,053		328,829
Due after ten years	812,292		741,781		731,160		643,832
U.S. government-sponsored mortgage-backed securities	1,527,463		1,324,684		124,169		117,474
Private mortgage-backed securities	184,643		171,394		—		—
Non-government-sponsored asset backed securities	228,751		225,648		—		—
Total	$	3,410,272	$	3,072,639	$	1,277,209	$	1,142,940

During the year ended December 31, 2024, no available-for-sale securities were sold. During the year ended December 31, 2023, no available-for-sale securities were sold. During the year ended December 31, 2022, $67.3 million in available-for-sale securities were sold, and no gain or loss was recognized.

The following shows gross unrealized losses and estimated fair value of investment securities classified as available-for-sale and held-to-maturity, aggregated by investment category and length of time that individual investment securities have been in a continuous loss position as of December 31, 2024 and 2023:


	December 31, 2024
	Less Than 12 Months				12 Months or More				Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(In thousands)
Available-for-sale:
U.S. government-sponsored enterprises	$	25,946	$	(326)	$	161,759	$	(13,746)	$	187,705	$	(14,072)
U.S. government-sponsored mortgage-backed securities	34,597		(1,088)		1,215,317		(202,451)		1,249,914		(203,539)
Private mortgage-backed securities	9,491		(129)		161,903		(13,120)		171,394		(13,249)
Non-government-sponsored asset backed securities	10,849		(60)		92,857		(3,374)		103,706		(3,434)
State and political subdivisions	46,591		(1,230)		761,289		(84,799)		807,880		(86,029)
Other securities	7,157		(911)		173,204		(17,370)		180,361		(18,281)
Total	$	134,631	$	(3,744)	$	2,566,329	$	(334,860)	$	2,700,960	$	(338,604)
Held-to-maturity:
U.S. government-sponsored enterprises	$	—	$	—	$	40,539	$	(3,021)	$	40,539	$	(3,021)
U.S. government-sponsored mortgage-backed securities	48,254		(1,979)		69,220		(4,716)		117,474		(6,695)


State and political subdivisions	29,612		(1,037)		954,335		(121,550)		983,947		(122,587)
Total	$	77,866	$	(3,016)	$	1,064,094	$	(129,287)	$	1,141,960	$	(132,303)


	December 31, 2023
	Less Than 12 Months				12 Months or More				Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(In thousands)
Available-for-sale:
U.S. government-sponsored enterprises	$	2,742	$	(2)	$	180,569	$	(17,091)	$	183,311	$	(17,093)
U.S. government-sponsored mortgage-backed securities	102,831		(2,166)		1,392,318		(189,391)		1,495,149		(191,557)
Private mortgage-backed securities	9,298		(226)		166,107		(15,891)		175,405		(16,117)
Non-government-sponsored asset backed securities	—		—		213,838		(7,551)		213,838		(7,551)
State and political subdivisions	28,596		(400)		769,860		(75,531)		798,456		(75,931)
Other securities	—		—		164,430		(28,030)		164,430		(28,030)
Total	$	143,467	$	(2,794)	$	2,887,122	$	(333,485)	$	3,030,589	$	(336,279)
Held-to-maturity:
U.S. government-sponsored enterprises	$	—	$	—	$	40,677	$	(2,607)	$	40,677	$	(2,607)
U.S. government-sponsored mortgage-backed securities	48,498		(861)		65,573		(3,501)		114,071		(4,362)


State and political subdivisions	21,493		(297)		956,578		(104,797)		978,071		(105,094)
Total	$	69,991	$	(1,158)	$	1,062,828	$	(110,905)	$	1,132,819	$	(112,063)

Debt securities available-for-sale ("AFS") are reported at fair value with unrealized holding gains and losses reported as a separate component of stockholders’ equity and other comprehensive income (loss), net of taxes. Securities that are held as available-for-sale are used as a part of our asset/liability management strategy. Securities that may be sold in response to interest rate changes, changes in prepayment risk, the need to increase regulatory capital, and other similar factors are classified as available-for-sale. The Company evaluates all securities quarterly to determine if any securities in a loss position require a provision for credit losses. The Company first assesses whether it intends to sell or is more likely than not that the Company will be required to sell the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value through income. For securities that do not meet these criteria, the Company evaluates whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, the Company considers the extent to which fair value is less than amortized cost, and changes to the rating of the security by a rating agency, and adverse conditions specifically related to the security, among other factors. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded for the credit loss, limited by the amount that the fair value is less than the amortized cost basis. Any impairment that has not been recorded through an allowance for credit losses is recognized in other comprehensive income. The Company has made the election to exclude accrued interest receivable on AFS securities from the estimate of credit losses and report accrued interest separately on the consolidated balance sheets. Changes in the allowance for credit losses are recorded as provision for (or reversal of) credit loss expense. Losses are charged against the allowance when management believes the uncollectability of a security is confirmed or when either of the criteria regarding intent or requirement to sell is met.

Debt securities held-to-maturity ("HTM"), which include any security for which we have the positive intent and ability to hold until maturity, are reported at historical cost adjusted for amortization of premiums and accretion of discounts. Premiums and discounts are amortized/accreted to the call date to interest income using the constant effective yield method over the estimated life of the security. The Company evaluates all securities quarterly to determine if any securities in a loss position require a provision for credit losses. The Company measures expected credit losses on HTM securities on a collective basis by major security type, with each type sharing similar risk characteristics. The estimate of expected credit losses considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts. The Company has made the election to exclude accrued interest receivable on HTM securities from the estimate of credit losses and report accrued interest separately on the consolidated balance sheets. Changes in the allowance for credit losses are recorded as provision for (or reversal of) credit loss expense. Losses are charged against the allowance when management believes the uncollectability of a security is confirmed.

During the year ended December 31, 2024, the Company recovered $330,000 in AFS reserves due to an improvement in the unrealized loss position of one of the Company's subordinated debt investments. During the year ended December 31, 2023, one of the Company’s AFS subordinated debt investment securities was downgraded below investment grade. As result, the Company wrote down the value of the investment to its unrealized loss position, which required a $1.7 million provision, but the remaining $842,000 allowance for credit losses on AFS investments associated with certain securities in the subordinated debt portfolio within the banking sector was considered adequate. At December 31, 2022, the Company determined the $842,000 allowance for credit losses on AFS investments associated with certain securities in the subordinated debt portfolio within the banking sector was considered adequate. These investments are classified within the other securities category of the AFS portfolio.

At both December 31, 2024 and 2023, the $2.0 million allowance for credit losses for the held-to-maturity portfolio was considered adequate. No additional provision for credit losses was considered necessary for the HTM portfolio. During the year ended December 31, 2022, the Company recorded a $2.0 million provision for credit losses for the HTM portfolio as a result of the investment securities acquired as part of the Happy acquisition.


Available-for-Sale Investment Securities
	Years Ended December 31,
	2024		2023		2022
	(In thousands)
Allowance for credit losses:
Beginning balance	$	2,525	$	842	$	842
Provision for credit loss	(330)		1,683		—
Ending balance, December 31,	$	2,195	$	2,525	$	842


Held-to-Maturity Investment Securities
	Years Ended December 31,
	2024		2023		2022
Allowance for credit losses:	(In thousands)
Beginning balance	$	2,005	$	2,005	$	—
Provision for credit loss - acquired securities	—		—		2,005
Securities charged-off	—		—		—
Recoveries	—		—		—
Ending balance, December 31,	$	2,005	$	2,005	$	2,005

For the year ended December 31, 2024, the Company had available-for-sale investment securities with approximately $334.9 million in unrealized losses, which have been in continuous loss positions for more than twelve months. With the exception of the subordinated debt investment securities which were downgraded during 2023 resulting in the allowance, the Company’s assessments indicated that the cause of the market depreciation was primarily due to the change in interest rates and not the issuer’s financial condition, or downgrades by rating agencies. In addition, approximately 38.9% of the Company’s available-for-sale investment portfolio will mature or are expected to pay down within five years or less. As a result, the Company has the ability and intent to hold such securities until maturity.

For the year ended December 31, 2023, the Company had available-for-sale investment securities with approximately $333.5 million in unrealized losses, which had been in continuous loss positions for more than twelve months. With the exception of the securities with credit losses noted above, the Company’s assessments indicated that the cause of the market depreciation was primarily due to the change in interest rates and not the issuer’s financial condition, or downgrades by rating agencies. In addition, approximately 30.4% of the Company’s available-for-sale investment portfolio was expected to mature or pay down within five years or less. As a result, the Company has the ability and intent to hold such securities until maturity.

As of December 31, 2024, the Company's available-for-sale securities portfolio consisted of 1,535 investment securities, 1,306 of which were in an unrealized loss position. As noted in the table above, the total amount of the unrealized loss was $338.6 million. The U.S government-sponsored enterprises portfolio contained unrealized losses of $14.1 million on 65 securities. The U.S. government-sponsored mortgage-backed securities portfolio contained $203.5 million of unrealized losses on 650 securities, and the private mortgage-backed securities portfolio contained $13.2 million of unrealized losses on 32 securities. The non-government-sponsored asset backed securities portfolio contained $3.4 million of unrealized losses on 23 securities. The state and political subdivisions portfolio contained $86.0 million of unrealized losses on 474 securities. In addition, the other securities portfolio contained $18.3 million of unrealized losses on 62 securities. With the exception of the investments for which an allowance for credit losses has been established, the unrealized losses on the Company's investments were primarily a result of interest rate changes, and the Company expects to recover the amortized cost basis over the term of the securities. The Company has determined that, as of December 31, 2024, an additional provision for credit losses is not necessary because the decline in market value was attributable to changes in interest rates and not credit quality, and because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost basis, which may be maturity.

As of December 31, 2024, the Company's held-to-maturity securities portfolio consisted of 512 investment securities, 507 of which were in an unrealized loss position. As noted in the table above, the total amount of the unrealized loss was $132.3 million. The U.S. government-sponsored enterprises portfolio contained unrealized losses of $3.0 million on 5 securities. The U.S. government-sponsored mortgage-backed securities portfolio contained $6.7 million of unrealized losses on 20 securities. The state and political subdivisions portfolio contained $122.6 million of unrealized losses on 482 securities. The unrealized losses on the Company's held-to-maturity investments were a result of interest rate changes. The Company expects to recover the amortized cost basis over the term of the securities. Because the decline in market value was attributable to changes in interest rates and not credit quality, the Company has determined that an additional provision for credit losses is not necessary as of December 31, 2024.

The following table summarizes bond ratings for the Company's held-to-maturity portfolio, based upon amortized cost, issued by state and political subdivisions and other securities as of December 31, 2024 and 2023:


	December 31, 2024
	State and Political Subdivisions		U.S. government-sponsored enterprises		U.S. government-sponsored mortgage-backed securities		Total
	(In thousands)
Aaa/AAA	$	235,504	$	43,560	$	—	$	279,064
Aa/AA	845,876		—		—		845,876
A	23,208		—		—		23,208

Not rated	4,892		—		—		4,892
Agency Backed	—		—		124,169		124,169
Total	$	1,109,480	$	43,560	$	124,169	$	1,277,209


	December 31, 2023
	State and Political Subdivisions		U.S. government-sponsored enterprises		U.S. government-sponsored mortgage-backed securities		Total
	(In thousands)
Aaa/AAA	$	235,557	$	43,285	$	—	$	278,842
Aa/AA	845,418		—		—		845,418
A	27,667		—		—		27,667

Not rated	1,782		—		—		1,782
Agency Backed	—		—		130,278		130,278
Total	$	1,110,424	$	43,285	$	130,278	$	1,283,987

Income earned on securities for the years ended is as follows:


	December 31,
	2024		2023		2022
	(In thousands)
Taxable:
Available-for-sale	$	95,940	$	108,650	$	71,352
Held-to-maturity	29,825		29,925		20,581
Tax-exempt:
Available-for-sale	18,586		19,104		19,168
Held-to-maturity	12,394		12,514		9,188
Total	$	156,745	$	170,193	$	120,289