XML 21 R12.htm IDEA: XBRL DOCUMENT
v3.23.1

Investment Securities | 3 Months Ended
--- | ---
Mar. 31, 2023
Investments, Debt and Equity Securities [Abstract] |
Investment Securities | The amortized cost and the approximate fair values of investment securities are summarized as follows:
March 31, 2023 | Amortized Cost | Allowance for Credit Losses | Net Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value
Available-for-Sale: |  |  |  |  |  |
U.S. Treasury notes | $ | 250.1 |  | $ | — |  | $ | 250.1 |  | $ | — |  | $ | (26.9) |  | $ | 223.2 |
State, county, and municipal securities | 262.0 |  | — |  | 262.0 |  | — |  | (40.9) |  | 221.1 |
Obligations of U.S. government agencies | 186.4 |  | — |  | 186.4 |  | — |  | (12.3) |  | 174.1 |
U.S. agency residential & commercial mortgage-backed securities & collateralized mortgage obligations | 4,221.0 |  | — |  | 4,221.0 |  | 0.2 |  | (362.8) |  | 3,858.4 |
Private mortgage-backed securities | 260.3 |  | — |  | 260.3 |  | — |  | (35.2) |  | 225.1 |
Collateralized loan obligations | 1,143.3 |  |  | 1,143.3 |  | — |  | (29.4) |  | 1,113.9 |
Corporate securities | 261.7 |  | (2.6) |  | 259.1 |  | — |  | (25.6) |  | 233.5 |
Total | $ | 6,584.8 |  | $ | (2.6) |  | $ | 6,582.2 |  | $ | 0.2 |  | $ | (533.1) |  | $ | 6,049.3 |
March 31, 2023 | Amortized Cost | Allowance for Credit Losses | Net Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value
Held-to-Maturity: |  |  |  |  |  |
U.S. Treasury notes | $ | 397.2 |  | $ | — |  | $ | 397.2 |  | $ | — |  | $ | (7.6) |  | $ | 389.6 |
State, county, and municipal securities | 180.9 |  | — |  | 180.9 |  | 0.4 |  | (25.2) |  | 156.1 |
Obligations of U.S. government agencies | 352.3 |  | — |  | 352.3 |  | — |  | (44.7) |  | 307.6 |
U.S. agency residential & commercial mortgage-backed securities & collateralized mortgage obligations (1) | 2,389.4 |  | — |  | 2,389.4 |  | 1.0 |  | (269.7) |  | 2,120.7 |
Corporate securities | 57.1 |  | (0.7) |  | 56.4 |  | — |  | (4.6) |  | 51.8 |
Total | $ | 3,376.9 |  | $ | (0.7) |  | $ | 3,376.2 |  | $ | 1.4 |  | $ | (351.8) |  | $ | 3,025.8 |
(1) Amortized cost presented above include $19.7 million of unamortized losses and $13.2 million of unamortized gains in U.S. agency residential and commercial mortgage-backed securities and collateralized mortgage obligations related to the 2021 and 2022 transfer of securities from available-for-sale to held-to-maturity.
December 31, 2022 | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses |  | Estimated Fair Value
Available-for-Sale: |  |  |  |  |
U.S. Treasury notes | $ | 675.1 |  | $ | 2.1 |  | $ | (34.5) |  |  | $ | 642.7 |
State, county, and municipal securities | 314.3 |  | — |  | (50.6) |  |  | 263.7 |
Obligations of U.S. government agencies | 216.2 |  | — |  | (17.3) |  |  | 198.9 |
U.S. agency residential & commercial mortgage-backed securities & collateralized mortgage obligations | 4,685.5 |  | 0.2 |  | (426.0) |  |  | 4,259.7 |
Private mortgage-backed securities | 264.9 |  | — |  | (36.9) |  |  | 228.0 |
Collateralized loan obligations | 1,145.2 |  | — |  | (33.6) |  |  | 1,111.6 |
Corporate securities | 272.3 |  | — |  | (30.8) |  |  | 241.5 |
Total | $ | 7,573.5 |  | $ | 2.3 |  | $ | (629.7) |  |  | $ | 6,946.1 |
December 31, 2022 | Amortized Cost | Allowance for Credit Losses | Net Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value |
Held-to-Maturity: |  |  |  |  |  |  |
U.S. Treasury notes | $ | 396.6 |  | $ | — |  | $ | 396.6 |  | $ | — |  | $ | (10.2) |  | $ | 386.4 |  |
State, county, and municipal securities | 181.2 |  | (0.1) |  | 181.1 |  | 0.2 |  | (31.6) |  | 149.7 |  |
Obligations of U.S. government agencies | 351.7 |  | — |  | 351.7 |  | — |  | (49.6) |  | 302.1 |  |
U.S. agency residential & commercial mortgage-backed securities & collateralized mortgage obligations(1) | 2,444.1 |  | — |  | 2,444.1 |  | 0.2 |  | (301.6) |  | 2,142.7 |  |
Corporate securities | 80.1 |  | (1.8) |  | 78.3 |  | — |  | (7.0) |  | 71.3 |  |
Total | $ | 3,453.7 |  | $ | (1.9) |  | $ | 3,451.8 |  | $ | 0.4 |  | $ | (400.0) |  | $ | 3,052.2 |  |
(1) Amortized cost presented above include $20.1 million of unamortized gains in U.S. agency residential and commercial mortgage-backed securities and collateralized mortgage obligations related to the 2021 transfer of securities from available-for-sale to held-to-maturity. |
Due to the recent banking industry’s significant volatility with multiple high-profile bank failures and industry wide concerns related to liquidity, deposit outflows, unrealized securities losses and eroding consumer confidence in the banking system, the Company reviewed our investment portfolio and transferred certain corporate debt securities classified as held-to-maturity, that were considered to have significant deterioration in the issuers’ credit worthiness, with an amortized cost of $23.0 million and an estimated fair value of $13.2 million to the available-for-sale category classification on March 13, 2023, under ASC 320. The transfer of debt securities into available-for-sale categories were recorded at fair value on the date of transfer. No gains or losses were recorded at the time of transfer; however, certain securities were subsequently sold during the first quarter of 2023, with the resulting loss reflected in the consolidated statements of income (loss) within the investment securities losses, net line item. The transferred securities had an allowance for credit losses of $0.8 million at the time of transfer. Additionally, transferred securities that were retained in the available-for-sale securities portfolio at March 31, 2023 were included in the assessment of the allowance for credit losses as described below. The following tables show the gross unrealized losses and fair values of available-for-sale investment securities and the length of time individual investment securities have been in an unrealized loss position as of March 31, 2023 and December 31, 2022.
| Less than 12 Months |  | 12 Months or More |  | Total
March 31, 2023 | Fair Value | Gross Unrealized Losses |  | Fair Value | Gross Unrealized Losses |  | Fair Value | Gross Unrealized Losses
Available-for-Sale: |  |  |  |  |  |  |  |
U.S. Treasury notes | $ | 48.1 |  | $ | (1.3) |  |  | $ | 175.1 |  | $ | (25.6) |  |  | $ | 223.2 |  | $ | (26.9) |
State, county, and municipal securities | 8.0 |  | (0.3) |  |  | 210.0 |  | (40.6) |  |  | 218.0 |  | (40.9) |
Obligations of U.S. government agencies | 86.7 |  | (4.0) |  |  | 86.8 |  | (8.3) |  |  | 173.5 |  | (12.3) |
U.S. agency residential & commercial mortgage-backed securities & collateralized mortgage obligations | 1,388.6 |  | (63.5) |  |  | 2,459.5 |  | (299.3) |  |  | 3,848.1 |  | (362.8) |
Private mortgage-backed securities | 0.1 |  | — |  |  | 225.0 |  | (35.2) |  |  | 225.1 |  | (35.2) |
Collateralized loan obligations | 117.3 |  | (3.0) |  |  | 996.6 |  | (26.4) |  |  | 1,113.9 |  | (29.4) |
Corporate securities | 80.0 |  | (2.8) |  |  | 153.5 |  | (22.8) |  |  | 233.5 |  | (25.6) |
Total | $ | 1,728.8 |  | $ | (74.9) |  |  | $ | 4,306.5 |  | $ | (458.2) |  |  | $ | 6,035.3 |  | $ | (533.1) |
| Less than 12 Months |  | 12 Months or More |  | Total
December 31, 2022 | Fair Value | Gross Unrealized Losses |  | Fair Value | Gross Unrealized Losses |  | Fair Value | Gross Unrealized Losses
Available-for-Sale: |  |  |  |  |  |  |  |
U.S. Treasury notes | $ | 168.8 |  | $ | (4.7) |  |  | $ | 170.4 |  | $ | (29.8) |  |  | $ | 339.2 |  | $ | (34.5) |
State, county, and municipal securities | 104.9 |  | (9.0) |  |  | 146.1 |  | (41.6) |  |  | 251.0 |  | (50.6) |
Obligations of U.S. government agencies | 152.2 |  | (10.1) |  |  | 46.1 |  | (7.2) |  |  | 198.3 |  | (17.3) |
U.S. agency residential & commercial mortgage-backed securities & collateralized mortgage obligations | 3,299.7 |  | (262.3) |  |  | 948.4 |  | (163.7) |  |  | 4,248.1 |  | (426.0) |
Private mortgage-backed securities | 133.1 |  | (19.1) |  |  | 94.9 |  | (17.8) |  |  | 228.0 |  | (36.9) |
Collateralized loan obligations | 1,082.6 |  | (33.1) |  |  | 28.9 |  | (0.5) |  |  | 1,111.5 |  | (33.6) |
Corporate securities | 130.6 |  | (8.3) |  |  | 110.8 |  | (22.5) |  |  | 241.4 |  | (30.8) |
Total | $ | 5,071.9 |  | $ | (346.6) |  |  | $ | 1,545.6 |  | $ | (283.1) |  |  | $ | 6,617.5 |  | $ | (629.7) |
As of March 31, 2023 and December 31, 2022, there were no holdings of securities of any issuer, other than the U.S. government and its agencies, in an amount greater than 10% of stockholders’ equity. The Company determines credit losses on both available-for-sale and held-to-maturity investment securities by a discounted cash flow approach using the security’s effective interest rate at the time of purchase or upon acquisition. The allowance for credit losses is measured as the amount by which an investment security’s amortized cost exceeds the net present value of expected future cash flows. However, the amount of credit losses for available-for-sale investment securities is limited to the amount of a security’s unrealized loss. Credit losses on held-to-maturity investment securities are representative of current expected credit losses that management expects to be incurred over the life of the investment. The allowance for credit losses is established through a charge to provision for credit losses in current period earnings. The available-for-sale securities portfolio primarily contains securities that are guaranteed by a sovereign entity or are generally considered to have non-credit related risks, such as interest rate risk or prepayment and liquidity factors. The Company considers whether the securities are issued by the federal government or its agencies and whether downgrades by bond rating agencies have occurred. As of March 31, 2023 and December 31, 2022, the Company had 1,023 and 1,222 individual investment securities, respectively, that were in an unrealized loss position, which was related primarily to fluctuations in current interest rates. As of March 31, 2023, the Company had the intent and ability to hold these investment securities for a period of time sufficient to allow for an anticipated recovery. The Company does not intend to sell any of the available-for-sale securities in the above table, and the Company does not anticipate it will have to sell any securities before a recovery in cost. The following table presents the activity in the allowance for credit losses related to investment securities:
|  | Three Months Ended March 31, |  |
|  | 2023 |  | 2022 |  |  |  |
Beginning balance |  | $ | 1.9 |  |  | $ | — |  |  |  |  |
Provision for available-for-sale credit losses |  | 2.6 |  |  | — |  |  |  |  |
Reversal of held-to-maturity credit loss losses |  | (1.2) |  |  | 1.6 |  |  |  |  |
Ending balance |  | $ | 3.3 |  |  | $ | 1.6 |  |  |  |  |
The Company had a $2.6 million and no allowance for credit losses for available-for-sale corporate investment securities as of March 31, 2023 and December 31, 2022, respectively. The Company had a $0.7 million and a $1.9 million allowance for credit losses for held-to-maturity corporate and state, county, and municipal investment securities as of March 31, 2023 and December 31, 2022, respectively. On a quarterly basis, the Company refreshes the credit quality indicator of each held-to-maturity security. The following table summarizes the credit quality indicators of held-to-maturity securities at amortized cost for the periods indicated:
March 31, 2023 | AAA | AA | A | BBB | BB | Not Rated | Total
U.S. Treasury notes | $ | 397.2 |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | 397.2 |
State, county, and municipal securities | 68.2 |  | 92.7 |  | 11.5 |  | — |  | — |  | 8.5 |  | 180.9 |
Obligations of U.S. government agencies | 352.3 |  | — |  | — |  | — |  | — |  | — |  | 352.3 |
U.S. agency residential & commercial mortgage-backed securities & collateralized mortgage obligations |  |  |  |  |  |  |
FNMA/FHLMC | 2,183.2 |  | — |  | — |  | — |  | — |  | — |  | 2,183.2 |
GNMA | 206.2 |  | — |  | — |  | — |  | — |  | — |  | 206.2 |
Corporate securities | — |  | — |  | — |  | 52.1 |  | — |  | 5.0 |  | 57.1 |
Total | $ | 3,207.1 |  | $ | 92.7 |  | $ | 11.5 |  | $ | 52.1 |  | $ | — |  | $ | 13.5 |  | $ | 3,376.9 |
December 31, 2022 | AAA | AA | A | BBB | BB | Not Rated | Total
U.S. Treasury notes | $ | 396.6 |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | 396.6 |
State, county, and municipal securities | 68.3 |  | 92.8 |  | 11.5 |  | — |  | — |  | 8.6 |  | 181.2 |
Obligations of U.S. government agencies | 351.7 |  | — |  | — |  | — |  | — |  | — |  | 351.7 |
U.S. agency residential & commercial mortgage-backed securities & collateralized mortgage obligations |  |  |  |  |  |  |
FNMA/FHLMC | 2,233.6 |  | — |  | — |  | — |  | — |  | — |  | 2,233.6 |
GNMA | 210.5 |  | — |  | — |  | — |  | — |  | — |  | 210.5 |
Corporate securities | — |  | — |  | — |  | 65.1 |  | 10.0 |  | 5.0 |  | 80.1 |
Total | $ | 3,260.7 |  | $ | 92.8 |  | $ | 11.5 |  | $ | 65.1 |  | $ | 10.0 |  | $ | 13.6 |  | $ | 3,453.7 |
As of March 31, 2023 and December 31, 2022, the Company had $35.6 million and $38.9 million, respectively, of accrued interest receivable from investment securities on the consolidated balance sheets. Accrued interest receivable is presented as a separate line item on the consolidated balance sheets and the Company does not include accrued interest receivable in the carrying amount of financial assets held at the amortized cost basis or in the related allowance for credit losses calculation. As of March 31, 2023 and December 31, 2022, there were no available-for-sale or held-to-maturity securities on nonaccrual status. All securities in the portfolio were current with their contractual principal and interest payments. As of March 31, 2023 and December 31, 2022, there were no collateral dependent available-for-sale or held-to-maturity securities. There were no material gross realized gains and $23.4 million in gross realized losses on the disposition of available-for-sale investment securities, as a result of the sale of $853.0 million in carrying value of investment securities, during the three months ended March 31, 2023. For the three month period ended March 31, 2022, there were no material gross realized gains and no material gross realized losses on the disposition of available-for-sale investment securities. Maturities of securities do not reflect rate repricing opportunities present in adjustable-rate mortgage-backed securities. Maturities of mortgage-backed securities have been adjusted to reflect shorter maturities based upon estimated prepayments of principal. All other investment securities maturities are shown at contractual maturity dates.
| Available-for-Sale |  | Held-to-Maturity
March 31, 2023 | Amortized Cost | Estimated Fair Value |  | Amortized Cost | Estimated Fair Value
Within one year | $ | 0.5 |  | $ | 0.5 |  |  | $ | 307.2 |  | $ | 300.4 |
After one year but within five years | 786.6 |  | 746.1 |  |  | 301.1 |  | 287.2 |
After five years but within ten years | 1,686.5 |  | 1,524.1 |  |  | 704.1 |  | 624.4 |
After ten years | 4,111.2 |  | 3,778.6 |  |  | 2,064.5 |  | 1,813.8 |
Total | $ | 6,584.8 |  | $ | 6,049.3 |  |  | $ | 3,376.9 |  | $ | 3,025.8 |
As of March 31, 2023, the Company held investment securities callable within one year having amortized costs and estimated fair values of $1,525.9 million and $1,446.9 million, respectively. These investment securities are primarily included in the “after ten years” category in the table above. As of March 31, 2023, the Company had no callable structured notes. As of March 31, 2023 and December 31, 2022, the Company has amortized costs of $3,607.3 million and $4,998.9 million, respectively, for investment securities pledged to secure public deposits and securities sold under repurchase agreements that had estimated fair values of $3,228.5 million and $4,432.0 million, as of March 31, 2023 and December 31, 2022, respectively. All securities sold under repurchase agreements are with clients and mature on the next banking day. The Company retains possession of the underlying securities sold under repurchase agreements. As of March 31, 2023 and December 31, 2022, the Company held $214.5 million and $198.6 million, respectively, in equity securities in a combination of Federal Reserve Bank and Federal Home Loan Bank stocks, which are restricted nonmarketable securities acquired to meet regulatory requirements. These securities are carried at cost.

X
- References No definition available. + Details
Name: | us-gaap_InvestmentsDebtAndEquitySecuritiesAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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
Name: | us-gaap_InvestmentsInDebtAndMarketableEquitySecuritiesAndCertainTradingAssetsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration