Securities

3 Months Ended

Mar. 31, 2021

Investments Debt And Equity Securities [Abstract]

Note 4. Securities

The following tables summarize the Company’s portfolio of debt securities available for sale and equity investments with readily determinable fair values at March 31, 2021 and December 31, 2020:


	March 31, 2021
(in thousands)	Amortized Cost		Gross Unrealized Gain		Gross Unrealized Loss		Fair Value
Debt securities available-for-sale
Mortgage-Related Debt Securities:
GSE certificates	$	1,183,746	$	40,473	$	14,901	$	1,209,318
GSE CMOs		2,007,855		28,837		50,422		1,986,270
Total mortgage-related debt securities	$	3,191,601	$	69,310	$	65,323	$	3,195,588
Other Debt Securities:
U. S. Treasury obligations	$	64,993	$	5	$	—	$	64,998
GSE debentures		1,433,280		2,693		67,632		1,368,341
Asset-backed securities (1)		520,111		4,030		3,368		520,773
Municipal bonds		25,715		482		186		26,011
Corporate bonds		870,886		16,594		5,410		882,070
Foreign notes		25,000		993		—		25,993
Capital trust notes		95,621		6,823		8,313		94,131
Total other debt securities	$	3,035,606	$	31,620	$	84,909	$	2,982,317
Total debt securities available for sale	$	6,227,207	$	100,930	$	150,232	$	6,177,905
Equity Securities:
Mutual funds		15,814		116		129		15,801
Total equity securities	$	15,814	$	116	$	129	$	15,801
Total securities (2)	$	6,243,021	$	101,046	$	150,361	$	6,193,706

(1) The underlying assets of the asset-backed securities are substantially guaranteed by the U.S. Government.

(2) Excludes accrued interest receivable of $14.8 million included in other assets in the Consolidated Statements of Condition.


	December 31, 2020
(in thousands)	Amortized Cost		Gross Unrealized Gain		Gross Unrealized Loss		Fair Value
Debt securities available-for-sale
Mortgage-Related Debt Securities:
GSE certificates	$	1,155,436	$	54,310	$	136	$	1,209,610
GSE CMOs		1,786,896		44,691		2,872		1,828,715
Total mortgage-related debt securities	$	2,942,332	$	99,001	$	3,008	$	3,038,325
Other Debt Securities:
U.S. Treasury obligations	$	64,984	$	1	$	—	$	64,985
GSE debentures		1,158,253		3,998		3,949		1,158,302
Asset-backed securities (1)		530,226		2,576		5,703		527,099
Municipal bonds		25,776		625		90		26,311
Corporate bonds		870,745		17,928		6,447		882,226
Foreign notes		25,000		538		—		25,538
Capital trust notes		95,507		5,540		10,500		90,547
Total other debt securities	$	2,770,491	$	31,206	$	26,689	$	2,775,008
Total other securities available for sale	$	5,712,823	$	130,207	$	29,697	$	5,813,333
Equity Securities:
Preferred stock	$	15,292	$	201	$	—	$	15,493
Mutual funds		15,814		269		—		16,083
Total equity securities	$	31,106	$	470	$	—	$	31,576
Total securities(2)	$	5,743,929	$	130,677	$	29,697	$	5,844,909

(1) The underlying assets of the asset-backed securities are substantially guaranteed by the U.S. Government.

(2) Excludes accrued interest receivable of $14.9 million included in other assets in the Consolidated Statements of Condition.

At March 31, 2021 and December 31, 2020, respectively, the Company had $699.0 million and $714.0 million of FHLB-NY stock, at cost. The Company maintains an investment in FHLB-NY stock partly in conjunction with its membership in the FHLB and partly related to its access to the FHLB funding it utilizes.

The following table summarizes the gross proceeds, gross realized gains, and gross realized losses from the sale of available-for-sale securities during the three months ended March 31, 2021 and 2020:


	For the Three Months Ended March 31,
(in thousands)	2021		2020
Gross proceeds	—		$	369,972
Gross realized gains		—		1,811
Gross realized losses		—		1,062

Net losses on equity securities recognized in earnings for the three months ended March 31, 2021 and 2020 were $483,000 and $215,000, respectively.

The following table summarizes, by contractual maturity, the amortized cost of securities at March 31, 2021:


	Mortgage- Related Securities		Average Yield			U.S. Government and GSE Obligations		Average Yield			State, County, and Municipal		Average Yield (1)			Other Debt Securities (2)		Average Yield			Fair Value
(dollars in thousands)
Available-for-Sale Debt Securities:
Due within one year	$	23,017		3.76	%	$	75,943		0.54	%	$	—		—	%	$	49,817		3.01	%	$	149,348
Due from one to five years		361,118		3.18			21,924		3.52			—		—			223,181		1.87			637,035
Due from five to ten years		175,554		2.48			238,052		2.16			19,840		3.51			706,390		2.03			1,146,853
Due after ten years		2,631,912		1.98			1,162,354		1.53			5,875		3.33			532,230		1.25			4,244,669
Total debt securities available for sale	$	3,191,601		2.16	%	$	1,498,273		1.61	%	$	25,715		3.47	%	$	1,511,618		1.76	%	$	6,177,905

(1) Not presented on a tax-equivalent basis.

(2) Includes corporate bonds, capital trust notes, and asset-backed securities.

The following table presents securities with no related allowance having a continuous unrealized loss position for less than twelve months and for twelve months or longer as of March 31, 2021:


	Less than Twelve Months				Twelve Months or Longer				Total
(in thousands)	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Temporarily Impaired Securities:
GSE certificates	$	323,281	$	14,901	$	—	$	—	$	323,281	$	14,901
GSE CMOs		918,257		50,422		—		—		918,257		50,422
GSE debentures		1,244,721		67,633		—		—		1,244,721		67,633
Asset-backed securities		112,149		405		179,063		2,962		291,212		3,367
Municipal bonds		—		—		8,744		186		8,744		186
Corporate bonds		—		—		319,590		5,410		319,590		5,410
Capital trust notes		—		—		35,601		8,313		35,601		8,313
Equity securities		11,676		129		—		—		11,676		129
Total temporarily impaired securities	$	2,610,084	$	133,490	$	542,998	$	16,871	$	3,153,082	$	150,361

The following table presents securities having a continuous unrealized loss position for less than twelve months and for twelve months or longer as of December 31, 2020:


	Less than Twelve Months				Twelve Months or Longer				Total
(in thousands)	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Temporarily Impaired Securities:
U. S. Treasury obligations	$	—	$	—	$	—	$	—	$	—	$	—
U. S. Government agency and GSE obligations		58,876		136		—		—		58,876		136
GSE certificates		442,207		2,807		73,568		65		515,775		2,872
GSE CMOs		522,441		3,949		—		—		522,441		3,949
Asset-backed securities		—		—		363,618		5,703		363,618		5,703
Municipal bonds		—		—		8,891		90		8,891		90
Corporate bonds		72,024		2,976		246,528		3,471		318,552		6,447
Foreign notes		—		—		—		—		—		—
Capital trust notes		—		—		33,393		10,500		33,393		10,500
Equity securities		—		—		—		—		—		—
Total temporarily impaired securities	$	1,095,548	$	9,868	$	725,998	$	19,829	$	1,821,546	$	29,697

The investment securities designated as having a continuous loss position for twelve months or more at March 31, 2021 consisted of five capital trusts notes, five asset-backed securities, five corporate bonds, and one municipal bond. The investment securities designated as having a continuous loss position for twelve months or more at December 31, 2020 consisted of four agency collateralized mortgage obligations, five capital trusts notes, seven asset-backed securities, three corporate bonds, and one municipal bond.

The Company evaluates available-for-sale debt securities in unrealized loss positions at least quarterly to determine if an allowance for credit losses is required. Based on an evaluation of available information about past events, current conditions, and reasonable and supportable forecasts that are relevant to collectability, the Company has concluded that it expects to receive all contractual cash flows from each security held in its available-for-sale securities portfolio.

We first assess whether (i) we intend to sell, or (ii) it is more likely than not that we will be required to sell the security before recovery of its amortized cost basis. If either of these criteria is met, any previously recognized allowances are charged off and the security’s amortized cost basis is written down to fair value through income. If neither of the aforementioned criteria is met, we evaluate whether the decline in fair value has resulted from credit losses or 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.

None of the unrealized losses identified as of March 31, 2021 or December 31, 2020 relates to the marketability of the securities or the issuers’ ability to honor redemption obligations. Rather, the unrealized losses relate to changes in interest rates relative to when the investment securities were purchased, and do not indicate credit-related impairment. Management based this conclusion on an analysis of each issuer including a detailed credit assessment of each issuer. The Company does not intend to sell, and it is not more likely than not that the Company will be required to sell the positions before the recovery of their amortized cost basis, which may be at maturity. As such, no allowance for credit losses was recorded with respect to debt securities as of or during the three months ended March 31, 2021.

Management has made the accounting policy election to exclude accrued interest receivable on available-for-sale securities from the estimate of credit losses. Available-for-sale debt securities are placed on non-accrual status when we no longer expect to receive all contractual amounts due, which is generally at 90 days past due. Accrued interest receivable is reversed against interest income when a security is placed on non-accrual status.