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Investment Securities, Equity Securities with Readily Determinable Fair Values and Other Investments | 9 Months Ended
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Sep. 30, 2022
Investment Securities, Equity Securities with Readily Determinable Fair Values and Other Investments |
Investment Securities, Equity Securities with Readily Determinable Fair Values and Other Investments | Note 6 — Investment Securities, Equity Securities with Readily Determinable Fair Values and Other Investments ​ We classify debt securities into one of three categories: held-to-maturity, available-for-sale, or trading. Such debt securities are reassessed for appropriate classification at each reporting date. Securities classified as “held-to-maturity” are carried at amortized cost for financial statement reporting, while securities classified as “available-for-sale” and “trading” are carried at their fair value. Unrealized holding gains and losses are included in net income for those securities classified as “trading,” while unrealized holding gains and losses related to those securities classified as “available-for-sale” are excluded from net income and reported net of tax as other comprehensive income (loss) and accumulated other comprehensive income (loss) until realized, or in the case of losses, when deemed other than temporary. Available-for-sale and held-to-maturity debt securities in an unrealized loss position are evaluated for the underlying cause of the loss. In the event that the deterioration in value is attributable to credit related reasons, then the amount of credit-related impairment will be recorded as a charge to our ACL with subsequent changes in the amount of impairment, up or down, also recorded through our ACL. We have evaluated the debt securities classified as available-for-sale and held-to-maturity at September 30, 2022 and have determined that no debt securities in an unrealized loss position are arising from credit related reasons and have therefore not recorded any allowances for debt securities in our ACL for the period. Unrealized gains and losses related to equity securities with readily determinable fair values are included in net income. ​ The amortized cost and estimated fair value by type of investment security at September 30, 2022 are as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Held to Maturity | ​
​ | ​ | ​ | ​ | ​ | Gross | ​ | Gross | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Amortized | ​ | unrealized | ​ | unrealized | ​ | Estimated | ​ | Carrying | ​
​ | ​ | cost | ​ | gains | ​ | losses | ​ | fair value | ​ | value | ​
​ | ​ | (Dollars in Thousands) | ​
Other securities |  | $ | 3,400 |  | $ | — |  | $ | — |  | $ | 3,400 |  | $ | 3,400 | ​
Total investment securities | ​ | $ | 3,400 | ​ | $ | — | ​ | $ | — | ​ | $ | 3,400 | ​ | $ | 3,400 | ​
​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Available for Sale Debt Securities | ​
​ | ​ | ​ | ​ | ​ | Gross | ​ | Gross | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Amortized | ​ | unrealized | ​ | unrealized | ​ | Estimated | ​ | Carrying | ​
​ | ​ | cost | ​ | gains | ​ | losses | ​ | fair value | ​ | value(1) | ​
​ | ​ | (Dollars in Thousands) | ​
U.S. Treasury securities |  | $ | 49,533 |  | $ | — |  | $ | (541) |  | $ | 48,992 |  | $ | 48,992 | ​
Residential mortgage-backed securities | ​ | ​ | 4,636,564 | ​ | ​ | 3 | ​ | ​ | (573,278) | ​ | ​ | 4,063,289 | ​ | ​ | 4,063,289 | ​
Obligations of states and political subdivisions | ​ |  | 110,430 | ​ |  | 51 | ​ |  | (7,372) | ​ |  | 103,109 | ​ |  | 103,109 | ​
Total investment securities | ​ | $ | 4,796,527 | ​ | $ | 54 | ​ | $ | (581,191) | ​ | $ | 4,215,390 | ​ | $ | 4,215,390 | ​
(1) | Included in the carrying value of residential mortgage-backed securities are $600,731 of mortgage-backed securities issued by Ginnie Mae and $3,462,558 of mortgage-backed securities issued by Fannie Mae and Freddie Mac.
​ The amortized cost and estimated fair value by type of investment security at December 31, 2021 are as follows:
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Held to Maturity | ​
​ | ​ | ​ | ​ | ​ | Gross | ​ | Gross | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Amortized | ​ | unrealized | ​ | unrealized | ​ | Estimated | ​ | Carrying | ​
​ | ​ | cost | ​ | gains | ​ | losses | ​ | fair value | ​ | value | ​
​ | ​ | (Dollars in Thousands) | ​
Other securities |  | $ | 3,400 |  | $ | — |  | $ | — |  | $ | 3,400 |  | $ | 3,400 | ​
Total investment securities | ​ | $ | 3,400 | ​ | $ | — | ​ | $ | — | ​ | $ | 3,400 | ​ | $ | 3,400 | ​
​ ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Available for Sale | ​
​ | ​ | ​ | ​ | ​ | Gross | ​ | Gross | ​ | Estimated | ​ | ​ | ​ | ​
​ | ​ | Amortized | ​ | unrealized | ​ | unrealized | ​ | fair | ​ | Carrying | ​
​ | ​ | cost | ​ | gains | ​ | losses | ​ | value | ​ | value(1) | ​
​ | ​ | (Dollars in Thousands) | ​
Residential mortgage-backed securities |  | $ | 4,213,441 |  | $ | 14,159 |  | $ | (58,237) |  | $ | 4,169,363 |  | $ | 4,169,363 | ​
Obligations of states and political subdivisions | ​ |  | 41,519 | ​ |  | 3,038 | ​ |  | — | ​ |  | 44,557 | ​ |  | 44,557 | ​
Total investment securities | ​ | $ | 4,254,960 | ​ | $ | 17,197 | ​ | $ | (58,237) | ​ | $ | 4,213,920 | ​ | $ | 4,213,920 | ​
(1) | Included in the carrying value of residential mortgage-backed securities are $824,474 of mortgage-backed securities issued by Ginnie Mae and $3,344,899 of mortgage-backed securities issued by Fannie Mae and Freddie.
​ The amortized cost and estimated fair value of investment securities at September 30, 2022, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to prepay obligations with or without prepayment penalties. ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Held to Maturity | ​ | Available for Sale | ​
​ | ​ | Amortized | ​ | Estimated | ​ | Amortized | ​ | Estimated | ​
​ | ​ | Cost | ​ | fair value | ​ | Cost | ​ | fair value | ​
​ | ​ | (Dollars in Thousands) | ​
Due in one year or less |  | $ | 1,200 |  | $ | 1,200 |  | $ | 49,533 |  | $ | 48,992 | ​
Due after one year through five years | ​ |  | 2,200 | ​ |  | 2,200 | ​ |  | — | ​ | ​ | — | ​
Due after ten years | ​ |  | — | ​ |  | — | ​ |  | 110,430 | ​ |  | 103,109 | ​
Residential mortgage-backed securities | ​ |  | — | ​ |  | — | ​ |  | 4,636,564 | ​ |  | 4,063,289 | ​
Total investment securities | ​ | $ | 3,400 | ​ | $ | 3,400 | ​ | $ | 4,796,527 | ​ | $ | 4,215,390 | ​
​ Residential mortgage-backed securities are securities primarily issued by the Federal Home Loan Mortgage Corporation (“Freddie Mac”), Federal National Mortgage Association (“Fannie Mae”), or the Government National Mortgage Association (“Ginnie Mae”). Investments in residential mortgage-backed securities issued by Ginnie Mae are fully guaranteed by the U.S. Government. Investments in residential mortgage-backed securities issued by Freddie Mac and Fannie Mae are not fully guaranteed by the U.S. Government, however, we believe that the quality of the bonds is similar to other AAA rated bonds with limited credit risk, particularly given the placement of Fannie Mae and Freddie Mac into conservatorship by the federal government in early September 2008 and because securities issued by others that are collateralized by residential mortgage-backed securities issued by Fannie Mae or Freddie Mac are rated consistently as AAA rated securities. ​ The amortized cost and fair value of available-for-sale debt investment securities pledged to qualify for fiduciary powers, to secure public monies as required by law, repurchase agreements and short-term fixed borrowings was $1,595,549,000 and $1,360,046,000, respectively, at September 30, 2022. ​ Proceeds from the sale and calls of debt securities available-for-sale were $800,000 and $800,000 for the three and nine months ended September 30, 2022, which included $0 and $0 of mortgage-backed securities. Gross gains of $0 and $0 and gross losses of $0 and $0 were realized on the sales and calls for the three and nine months ended September 30, 2022. Proceeds from the sale and call of debt securities available-for-sale were $3,025,000 and $5,890,000 for the three and nine months ended September 30, 2021, which included $0 and $0 of mortgage-backed securities. Gross gains of $0 and $0 and gross losses of $12,000 and $16,000 were realized on the sales and calls for the three and nine months ended September 30, 2021, respectively. ​ Gross unrealized losses on debt investment securities and the fair value of the related securities, aggregated by investment category and length of time that individual debt securities have been in a continuous unrealized loss position at September 30, 2022, were as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Less than 12 months | ​ | 12 months or more | ​ | Total | ​
​ | ​ | ​ | ​ | ​ | Unrealized | ​ | ​ | ​ | ​ | Unrealized | ​ | ​ | ​ | ​ | Unrealized | ​
​ | ​ | Fair Value | ​ | Losses | ​ | Fair Value | ​ | Losses | ​ | Fair Value | ​ | Losses | ​
​ | ​ | (Dollars in Thousands) | ​
Available for sale: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
U.S. Treasury securities | ​ | $ | 48,992 | ​ | $ | (541) | ​ | $ | — | ​ | $ | — | ​ | $ | 48,992 | ​ | $ | (541) | ​
Residential mortgage-backed securities |  | ​ | 2,091,227 |  | ​ | (230,060) |  | ​ | 1,950,011 |  | ​ | (343,218) |  | ​ | 4,041,238 |  | ​ | (573,278) | ​
Obligations of states and political subdivisions | ​ |  | 86,055 | ​ |  | (7,372) | ​ |  | — | ​ |  | — | ​ |  | 86,055 | ​ |  | (7,372) | ​
​ | ​ | $ | 2,226,274 | ​ | $ | (237,973) | ​ | $ | 1,950,011 | ​ | $ | (343,218) | ​ | $ | 4,176,285 | ​ | $ | (581,191) | ​
​ Gross unrealized losses on investment securities and the fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at December 31, 2021 were as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Less than 12 months | ​ | 12 months or more | ​ | Total | ​
​ | ​ | ​ | ​ | ​ | Unrealized | ​ | ​ | ​ | ​ | Unrealized | ​ | ​ | ​ | ​ | Unrealized | ​
​ | ​ | Fair Value | ​ | Losses | ​ | Fair Value | ​ | Losses | ​ | Fair Value | ​ | Losses | ​
​ | ​ | (Dollars in Thousands) | ​
Available for sale: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Residential mortgage-backed securities |  | $ | 3,037,188 |  | $ | (53,060) |  | $ | 423,733 |  | $ | (5,177) |  | $ | 3,460,921 |  | $ | (58,237) | ​
​ | ​ | $ | 3,037,188 | ​ | $ | (53,060) | ​ | $ | 423,733 | ​ | $ | (5,177) | ​ | $ | 3,460,921 | ​ | $ | (58,237) | ​
​ The unrealized losses on investments in residential mortgage-backed securities are primarily caused by changes in market interest rates. We have no intent to sell and will more than likely not be required to sell before a market price recovery or maturity of the securities; therefore, it is our conclusion that the investments in residential mortgage-backed securities issued by Freddie Mac, Fannie Mae and Ginnie Mae are not considered other-than-temporarily impaired. ​ Equity securities with readily determinable fair values consist primarily of Community Reinvestment Act funds. At September 30, 2022 and December 31, 2021, the balance in equity securities with readily determinable fair values recorded at fair value were $5,351,000 and $6,079,000, respectively. The following is a summary of unrealized and realized gains and losses recognized in net income on equity securities during the three and nine months ended September 30, 2022 and the three and nine months ended September 30, 2021: ​
​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended
​ | ​ | September 30, 2022
​ | ​ | (Dollars in Thousands)
​ | ​ | ​
​ | ​ | ​ | ​ | ​
Net losses recognized during the period on equity securities |  | $ | ​ | (230)
Less: Net gains and (losses) recognized during the period on equity securities sold during the period | ​ |  | ​ | —
​ | ​ | ​ | ​ | ​
Unrealized losses recognized during the reporting period on equity securities still held at the reporting date | ​ | $ | ​ | (230)
​
​ | ​ | ​ | ​ | ​
​ | ​ | Nine Months Ended
​ | ​ | September 30, 2022
​ | ​ | (Dollars in Thousands)
​ | ​ | ​
Net losses recognized during the period on equity securities |  | $ | ​ | (728)
Less: Net gains and (losses) recognized during the period on equity securities sold during the period | ​ |  | ​ | —
​ | ​ | ​ | ​ | ​
Unrealized losses recognized during the reporting period on equity securities still held at the reporting date | ​ | $ | ​ | (728)
​ ​
​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended
​ | ​ | September 30, 2021
​ | ​ | (Dollars in Thousands)
​ | ​ | ​
​ | ​ | ​ | ​ | ​
Net losses recognized during the period on equity securities |  | $ | ​ | (5)
Less: Net gains and (losses) recognized during the period on equity securities sold during the period | ​ |  | ​ | —
​ | ​ | ​ | ​ | ​
Unrealized losses recognized during the reporting period on equity securities still held at the reporting date | ​ | $ | ​ | (5)
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ | ​ | ​ | ​ | ​
​ | ​ | Nine Months Ended
​ | ​ | September 30, 2021
​ | ​ | (Dollars in Thousands)
​ | ​ | ​
Net losses recognized during the period on equity securities |  | $ | ​ | (70)
Less: Net gains and (losses) recognized during the period on equity securities sold during the period | ​ |  | ​ | —
​ | ​ | ​ | ​ | ​
Unrealized losses recognized during the reporting period on equity securities still held at the reporting date | ​ | $ | ​ | (70)
​ Other investments include equity and merchant banking investments held by our subsidiary banks and non-banking entities. We hold ownership interests in limited partnerships for the purpose of investing in low-income housing tax credit (“LIHTC”) projects. The partnerships may acquire, construct or rehabilitate housing for low- and moderate-income individuals. We realize a return primarily from federal tax credits and other federal tax deductions associated with the underlying projects. We are a limited partner in the partnerships, and not required to consolidate the entities in our consolidated financial statements. Investments in LIHTC projects totaled $236,718,000 at September 30, 2022 and $179,543,000 at December 31, 2021, and are included in other investments on the consolidated financial statements. Unfunded commitments to LIHTC projects totaled $42,896,000 at September 30, 2022 and $40,094,000 at December 31, 2021, and are included in other liabilities on the consolidated financial statements.

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- Definition The entire disclosure for investments in certain debt and equity securities. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 320 -URI https://asc.fasb.org/subtopic&trid=2209399 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 946 -SubTopic 320 -URI https://asc.fasb.org/subtopic&trid=2324412 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -URI https://asc.fasb.org/topic&trid=2196928 Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 940 -SubTopic 320 -URI https://asc.fasb.org/subtopic&trid=2176304 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher SEC -Name Regulation S-K (SK) -Number 229 -Section 1403 -Paragraph (b) + Details
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