Investment Securities

9 Months Ended

Sep. 30, 2021

Investments, Debt and Equity Securities [Abstract]

The following table presents the amortized cost and estimated fair values of investment securities for the periods presented:


	September 30, 2022
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Available for Sale	(in thousands)
U.S. Government securities	$	226,439	$	—	$	(8,255)	$	218,184

U.S. Government-sponsored agency securities	1,053		—		(47)		1,006
State and municipal securities	1,287,140		12		(248,967)		1,038,185
Corporate debt securities	436,443		—		(36,828)		399,615
Collateralized mortgage obligations	155,010		—		(12,609)		142,401
Residential mortgage-backed securities	246,854		6		(32,608)		214,252
Commercial mortgage-backed securities	655,384		—		(71,643)		583,741


Total	$	3,008,323	$	18	$	(410,957)	$	2,597,384

Held to Maturity

Residential mortgage-backed securities	$	470,879	$	—	$	(60,881)	$	409,998
Commercial mortgage-backed securities	868,431		—		(136,719)		731,712
Total	$	1,339,310	$	—	$	(197,600)	$	1,141,710


	December 31, 2021
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Available for Sale	(in thousands)
U.S. Government securities	$	127,831	$	—	$	(213)	$	127,618

State and municipal securities	1,139,187		50,161		(678)		1,188,670
Corporate debt securities	373,482		13,009		(358)		386,133
Collateralized mortgage obligations	206,532		3,581		(754)		209,359
Residential mortgage-backed securities	231,607		1,224		(3,036)		229,795
Commercial mortgage-backed securities	974,541		6,141		(9,534)		971,148
Auction rate securities	76,350		—		(1,683)		74,667
Total	$	3,129,530	$	74,116	$	(16,256)	$	3,187,390



Held to Maturity

Residential mortgage-backed securities	$	404,958	$	11,022	$	(7,067)	$	408,913
Commercial mortgage-backed securities	575,426		—		(18,472)		556,954
Total	$	980,384	$	11,022	$	(25,539)	$	965,867

During the first quarter of 2022, all ARCs were sold.

On May 1, 2022, the Corporation transferred certain residential mortgage-backed securities and commercial mortgage-backed securities from AFS to HTM classification as permitted by ASU 2019-04. The estimated fair value of the securities transferred was $415.2 million, and the amortized cost of the securities was $479.0 million.

Securities carried at $1.3 billion at September 30, 2022 and $2.5 billion at December 31, 2021 were pledged as collateral to secure public and trust deposits.

The amortized cost and estimated fair values of debt securities as of September 30, 2022, by contractual maturity, are shown in the following table. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay with or without call or prepayment penalties.


		September 30, 2022
		Available for Sale				Held to Maturity
		Amortized Cost		Estimated Fair Value		Amortized Cost		Estimated Fair Value
	(in thousands)
Due in one year or less		$	9,524	$	9,516	$	—	$	—
Due from one year to five years		287,824		277,609		—		—
Due from five years to ten years		506,946		463,474		—		—
Due after ten years		1,146,781		906,391		—		—
		1,951,075		1,656,990		—		—
Residential mortgage-backed securities(1)		246,854		214,252		470,879		409,998
Commercial mortgage-backed securities(1)		655,384		583,741		868,431		731,712
Collateralized mortgage obligations(1)		155,010		142,401		—		—
Total		$	3,008,323	$	2,597,384	$	1,339,310	$	1,141,710
(1) Maturities for mortgage-backed securities and collateralized mortgage obligations are dependent upon the interest rate environment and prepayments on the underlying loans.

The following table presents information related to gross realized gains and losses on the sales of securities for the periods presented:


	Gross Realized Gains		Gross Realized Losses		Net (Losses) Gains
Three months ended	(in thousands)
September 30, 2022	$	33	$	(86)	$	(53)
September 30, 2021	—		—		—

Nine months ended
September 30, 2022	$	1,587	$	(1,613)	$	(26)
September 30, 2021	34,481		(970)		33,511

During the first quarter of 2021, the Corporation completed a balance sheet restructuring that included a $34.0 million gain on the sale of Visa Shares, offset by losses on other securities of $0.4 million, primarily in connection with the sale of $24.6 million of ARCs.

The following tables present the gross unrealized losses and estimated fair values of investment securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position for the periods presented:


	September 30, 2022
	Less than 12 months					12 months or longer					Total
	Number of Securities	Estimated Fair Value		Unrealized Losses		Number of Securities	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses

Available for Sale		(dollars in thousands)
U.S. Government securities	3	$	218,184	$	(8,255)	—	$	—	$	—	$	218,184	$	(8,255)

U.S. Government-sponsored agency securities	1	1,006		(47)		—	—		—		1,006		(47)
State and municipal securities	395	982,919		(228,508)		22	45,759		(20,459)		1,028,678		(248,967)
Corporate debt securities	68	386,141		(35,547)		2	10,718		(1,281)		396,859		(36,828)
Collateralized mortgage obligations	100	121,120		(7,182)		1	21,281		(5,427)		142,401		(12,609)
Residential mortgage-backed securities	101	157,808		(19,901)		4	55,110		(12,707)		212,918		(32,608)
Commercial mortgage-backed securities	122	462,988		(47,022)		12	120,753		(24,621)		583,741		(71,643)

Total available for sale	790	$	2,330,166	$	(346,462)	41	$	253,621	$	(64,495)	$	2,583,787	$	(410,957)

Held to Maturity

Residential mortgage-backed securities	108	$	270,986	$	(20,485)	12	$	139,012	$	(40,396)	$	409,998	$	(60,881)
Commercial mortgage-backed securities	33	376,207		(46,035)		27	355,505		(90,684)		731,712		(136,719)
Total	141	$	647,193	$	(66,520)	39	$	494,517	$	(131,080)	$	1,141,710	$	(197,600)


	December 31, 2021
	Less than 12 months					12 months or longer					Total
	Number of Securities	Estimated Fair Value		Unrealized Losses		Number of Securities	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
Available for Sale	(dollars in thousands)
U.S Government Securities	2	$	127,618	$	(213)	—	$	—	$	—	$	127,618	$	(213)

State and municipal securities	29	82,731		(678)		—	—		—		82,731		(678)
Corporate debt securities	6	43,068		(358)		—	—		—		43,068		(358)
Collateralized mortgage obligations	4	28,517		(754)		—	—		—		28,517		(754)
Residential mortgage-backed securities	7	123,687		(2,388)		1	16,669		(648)		140,356		(3,036)
Commercial mortgage-backed securities	41	512,312		(9,534)		—	—		—		512,312		(9,534)
Auction rate securities	—	—		—		118	74,667		(1,683)		74,667		(1,683)
Total available for sale	89	$	917,933	$	(13,925)	119	$	91,336	$	(2,331)	$	1,009,269	$	(16,256)



Held to Maturity

Residential mortgage-backed securities	14	$	205,969	$	(7,067)	—	$	—	$	—	$	205,969	$	(7,067)
Commercial mortgage-backed securities	36	556,954		(18,472)		—	—		—		556,954		(18,472)
Total	50	$	762,923	$	(25,539)	—	$	—	$	—	$	762,923	$	(25,539)

The Corporation's collateralized mortgage obligations and mortgage-backed securities have contractual terms that generally do not permit the issuer to settle the securities at a price less than the amortized cost of the investment. The change in fair value of these securities is attributable to changes in interest rates and not credit quality. The Corporation does not have the intent to sell and does not believe it will more likely than not be required to sell any of these securities prior to a recovery of their fair value to amortized cost. Therefore, the Corporation does not have an ACL for these investments as of September 30, 2022 and December 31, 2021.

Based on management’s evaluations, no ACL was required for state and municipal securities as of September 30, 2022 or December 31, 2021. The Corporation does not have the intent to sell and does not believe it will more likely than not be required to sell any of these securities prior to a recovery of their fair value to amortized cost, which may be at maturity.

As of September 30, 2022 and December 31, 2021, all corporate debt securities were rated above investment grade. Based on the payment status, rating and management's evaluation of these securities, no ACL was required for corporate debt securities as of September 30, 2022 or December 31, 2021.

As of December 31, 2021, all ARCs were rated above investment grade. All of the loans underlying the ARCs had principal payments that were guaranteed by the federal government. Based on the payment status, rating and management's evaluation of these securities, no ACL was required for ARCs as of December 31, 2021.