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Note 2 - Debt Securities

12 Months Ended

Dec. 31, 2023

Notes to Financial Statements

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

NOTE 2. DEBT SECURITIES

The amortized cost and fair values of available-for-sale and held-to-maturity debt securities at December 31, 2023 and 2022 are summarized as follows:

						Gross				Gross
		Amortized				Unrealized				Unrealized				Market
		Cost				Gain				Loss				Value
		(In Thousands)
December 31, 2023
Debt Securities Available-for-Sale
U.S. Treasury Securities		$	340,556			$	251			$	-			$	340,807
Mortgage-backed securities			241,458				6				(25,979	)			215,485
State and municipal securities			11,400				1				(1,178	)			10,223
Corporate debt			375,676				-				(42,009	)			333,667
Total		$	969,090			$	258			$	(69,166	)		$	900,183
Debt Securities Held-to-Maturity
U.S. Treasury Securities		$	508,985			$	-			$	(24,718	)		$	484,267
Mortgage-backed securities			465,615				3				(50,025	)			415,593
State and municipal securities			8,063				-				(732	)			7,331
Total		$	982,664			$	3			$	(75,475	)		$	907,191

December 31, 2022
Debt Securities Available-for-Sale
U.S. Treasury Securities		$	3,002			$	-			$	(33	)		$	2,969
Government Agency Securities			9				-				-				9
Mortgage-backed securities			282,480				5				(32,782	)			249,703
State and municipal securities			15,205				1				(1,597	)			13,609
Corporate debt			406,680				-				(28,155	)			378,525
Total		$	707,376			$	6			$	(62,567	)		$	644,815
Debt Securities Held-to-Maturity
U.S. Treasury Securities		$	507,151			$	-			$	(36,197	)		$	470,954
Mortgage-backed securities			518,929				7				(60,960	)			457,976
State and municipal securities			8,041				-				(1,018	)			7,023
Total		$	1,034,121			$	7			$	(98,175	)		$	935,953

All mortgage-backed debt securities are issued by government sponsored enterprises such as Federal National Mortgage Association, Government National Mortgage Association, Federal Home Loan Bank, and Federal Home Loan Mortgage Corporation.

The carrying value of debt securities pledged to secure public funds on deposits and for other purposes as required by law as of December 31, 2023 and 2022 was $1.49 billion and $789.3 million, respectively.

Restricted equity securities is comprised entirely of a restricted investment in Federal Home Loan Bank of Atlanta stock for membership requirement.

At December 31, 2023 and 2022, there were no holdings of debt securities of any issuer, other than the U.S. government and its agencies, in an amount greater than 10% of stockholders’ equity.

The amortized cost and fair value of debt securities as of December 31, 2023 and 2022 by contractual maturity are shown below. Actual maturities may differ from contractual maturities because the issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

		December 31, 2023								December 31, 2022
		Amortized Cost				Market Value				Amortized Cost				Market Value
		(In Thousands)
Debt securities available-for-sale
Due within one year		$	350,400			$	350,396			$	24,712			$	24,432
Due from one to five years			70,016				67,334				58,554				57,092
Due from five to ten years			304,216				264,892				338,630				311,100
Due after ten years			3,000				2,076				3,000				2,488
Mortgage-backed securities			241,458				215,485				282,480				249,703
		$	969,090			$	900,183			$	707,376			$	644,815

Debt securities held-to-maturity
Due within one year		$	260,047			$	257,835			$	250			$	250
Due from one to five years			203,481				185,741				386,465				366,095
Due from five to ten years			53,521				48,022				128,477				111,632
Mortgage-backed securities			465,615				415,593				518,929				457,976
		$	982,664			$	907,191			$	1,034,121			$	935,953

The following table identifies the Company’s investment securities that have been in a continuous unrealized loss position for less than 12 months and those that have been in a continuous unrealized loss position for 12 or more months, as of December 31, 2023 and 2022.

		Less Than Twelve Months								Twelve Months or More								Total
		Gross								Gross								Gross
		Unrealized								Unrealized								Unrealized
		Losses				Fair Value				Losses				Fair Value				Losses				Fair Value
		(In Thousands)
December 31, 2023
Debt Securities available-for-sale
Mortgage-backed securities		$	(6	)		$	704			$	(25,973	)		$	214,393			$	(25,979	)		$	215,097
State and municipal securities			-				-				(1,178	)			9,777				(1,178	)			9,777
Corporate debt			(794	)			15,141				(41,214	)			311,666				(42,009	)			326,807
Total		$	(801	)		$	15,845			$	(68,365	)		$	535,836			$	(69,166	)		$	551,681
Debt Securities held-to-maturity
U.S. Treasury Securities		$	-			$	-			$	(24,718	)		$	484,267			$	(24,718	)		$	484,267
Mortgage-backed securities			(1	)			430				(50,024	)			411,585				(50,025	)			412,015
State and municipal securities			-				-				(732	)			7,081				(732	)			7,081
Total		$	(1	)		$	430			$	(75,474	)		$	902,933			$	(75,475	)		$	903,363
December 31, 2022
Debt Securities available-for-sale
U.S. Treasury Securities		$	(33	)		$	2,969			$	-			$	-			$	(33	)		$	2,969
Government Agency Securities			-				9				-				-				-				9
Mortgage-backed securities		$	(3,473	)		$	60,234			$	(29,309	)		$	189,109			$	(32,782	)		$	249,343
State and municipal securities			(186	)			5,283				(1,411	)			7,880				(1,597	)			13,163
Corporate debt			(18,566	)			304,254				(9,589	)			63,411				(28,155	)			367,666
Total		$	(22,258	)		$	372,749			$	(40,309	)		$	260,400			$	(62,567	)		$	633,149
U.S. Treasury Securities		$	(12,662	)		$	295,383			$	(23,537	)		$	175,570			$	(36,197	)		$	470,953
Mortgage-backed securities			(31,367	)			278,746				(29,592	)			174,842				(60,960	)			453,588
State and municipal securities			(544	)			4,443				(474	)			2,330				(1,018	)			6,773
Total		$	(44,573	)		$	578,572			$	(53,603	)		$	352,742			$	(98,175	)		$	931,314

At December 31, 2023 and 2022, no allowance for credit losses has been recognized on available-for-sale debt securities in an unrealized loss position as the Company does not believe any of the debt securities are credit impaired. This is based on the Company’s analysis of the risk characteristics, including credit ratings, and other qualitative factors related to available-for-sale debt securities. The issuers of these debt securities continue to make timely principal and interest payments under the contractual terms of the securities. The Company does not intend to sell these debt securities and it is more likely than not that the Company will not be required to sell the debt securities before recovery of their amortized cost, which may be at maturity. The unrealized losses are due to increases in market interest rates over the yields available at the time the debt securities were purchased. Management measures expected credit losses on held-to-maturity securities on a collective basis by major security type with each type sharing similar risk characteristics and considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts. With regard to U.S. Treasury and residential mortgage-backed securities issued by the U.S. government, or agencies thereof, it is expected that the securities will not be settled at prices less than the amortized cost bases of the securities as such securities are backed by the full faith and credit of and/or guaranteed by the U.S. government. Accordingly, no allowance for credit losses has been recorded for these securities. With regard to securities issued by States and political subdivisions and other held-to-maturity securities, management considers (i) issuer bond ratings, (ii) historical loss rates for given bond ratings, (iii) whether issuers continue to make timely principal and interest payments under the contractual terms of the securities, and (iv) internal forecasts. Historical loss rates associated with securities having similar grades as those in our portfolio have generally not been significant. Furthermore, as of December 31, 2023 and 2022, there were no past due principal or interest payments associated with these securities. Based upon (i) the issuer’s strong bond ratings and (ii) a zero historical loss rate, no allowance for credit losses has been recorded for held-to-maturity State and Municipal Securities as such amount is not material at December 31, 2023 and 2022. All debt securities in an unrealized loss position as of December 31, 2023 continue to perform as scheduled and the Company does not believe there is a possible credit loss or that an allowance for credit loss on these debt securities is necessary.

The following table summarizes information about sales and calls of debt securities.

		Years Ended December 31,
		2023				2022				2021
		(In Thousands)
Sale and call proceeds		$	-			$	75,036			$	6,272
Gross realized gains		$	-			$	-			$	620
Gross realized losses			-				(6,168	)			-
Net realized (loss) gain		$	-			$	(6,168	)		$	620