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Investment Securities | 9 Months Ended
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Sep. 30, 2024
Investments, Debt and Equity Securities [Abstract] |
Investment Securities | The amortized cost and the approximate fair values of investment securities are summarized as follows:
September 30, 2024 | Amortized Cost |  |  | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value
Available-for-Sale: |  |  |  |  |  |
U.S. Treasury notes | $ | 250.2 |  |  |  | $ | — |  | $ | (19.2) |  | $ | 231.0 |
State, county, and municipal securities | 252.8 |  |  |  | — |  | (31.9) |  | 220.9 |
Obligations of U.S. government agencies | 171.9 |  |  |  | — |  | (6.5) |  | 165.4 |
U.S. agency commercial mortgage-backed securities | 1,164.1 |  |  |  | 1.4 |  | (60.2) |  | 1,105.3 |
U.S. agency residential mortgage-backed securities | 1,354.2 |  |  |  | 2.4 |  | (94.2) |  | 1,262.4 |
Collateralized mortgage obligations | 1,202.1 |  |  |  | 2.2 |  | (87.7) |  | 1,116.6 |
Private mortgage-backed securities | 223.3 |  |  |  | — |  | (23.7) |  | 199.6 |
Collateralized loan obligation | 987.4 |  |  |  | 0.6 |  | — |  | 988.0 |
Corporate securities | 260.0 |  |  |  | — |  | (14.9) |  | 245.1 |
Total | $ | 5,866.0 |  |  |  | $ | 6.6 |  | $ | (338.3) |  | $ | 5,534.3 |
September 30, 2024 | Amortized Cost 1 | Allowance for Credit Losses | Net Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value
Held-to-Maturity: |  |  |  |  |  |
U.S. Treasury notes | $ | 99.6 |  | $ | — |  | $ | 99.6 |  | $ | — |  | $ | (0.4) |  | $ | 99.2 |
State, county, and municipal securities | 176.7 |  | — |  | 176.7 |  | 0.3 |  | (20.6) |  | 156.4 |
Obligations of U.S. government agencies | 356.4 |  | — |  | 356.4 |  | — |  | (32.0) |  | 324.4 |
U.S. agency commercial mortgage-backed securities | 493.0 |  | — |  | 493.0 |  | — |  | (41.8) |  | 451.2 |
U.S. agency residential mortgage-backed securities | 1,119.5 |  | — |  | 1,119.5 |  | 0.5 |  | (106.2) |  | 1,013.8 |
Collateralized mortgage obligations | 439.8 |  | — |  | 439.8 |  | 0.8 |  | (57.8) |  | 382.8 |
Corporate securities | 57.0 |  | (0.7) |  | 56.3 |  | — |  | (3.6) |  | 52.7 |
Total | $ | 2,742.0 |  | $ | (0.7) |  | $ | 2,741.3 |  | $ | 1.6 |  | $ | (262.4) |  | $ | 2,480.5 |
(1) Amortized cost presented above includes $8.6 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, and $16.5 million of unamortized losses in state, county, and municipal, obligations of U.S. government agencies and collateralized loan obligations related to the 2022 transfer of securities from available-for-sale to held-to-maturity.
December 31, 2023 | Amortized Cost |  |  | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value
Available-for-Sale: |  |  |  |  |  |
U.S. Treasury notes | $ | 250.2 |  |  |  | $ | — |  | $ | (25.5) |  | $ | 224.7 |
State, county, and municipal securities | 256.7 |  |  |  | — |  | (36.9) |  | 219.8 |
Obligations of U.S. government agencies | 179.4 |  |  |  | — |  | (10.9) |  | 168.5 |
U.S. agency commercial mortgage-backed securities | 1,192.7 |  |  |  | 0.6 |  | (87.7) |  | 1,105.6 |
U.S. agency residential mortgage-backed securities | 1,496.3 |  |  |  | 1.2 |  | (130.6) |  | 1,366.9 |
Collateralized mortgage obligations | 1,308.5 |  |  |  | 1.3 |  | (120.3) |  | 1,189.5 |
Private mortgage-backed securities | 241.3 |  |  |  | — |  | (30.9) |  | 210.4 |
Collateralized loan obligation | 1,121.9 |  |  |  | 0.1 |  | (2.3) |  | 1,119.7 |
Corporate securities | 260.8 |  |  |  | — |  | (24.4) |  | 236.4 |
Total | $ | 6,307.8 |  |  |  | $ | 3.2 |  | $ | (469.5) |  | $ | 5,841.5 |
December 31, 2023 | Amortized Cost 1 | Allowance for Credit Losses | Net Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value |
Held-to-Maturity: |  |  |  |  |  |  |
U.S. Treasury notes | $ | 399.0 |  | $ | — |  | $ | 399.0 |  | $ | — |  | $ | (2.8) |  | $ | 396.2 |  |
State, county, and municipal securities | 179.2 |  | — |  | 179.2 |  | 0.2 |  | (24.2) |  | 155.2 |  |
Obligations of U.S. government agencies | 354.5 |  | — |  | 354.5 |  | — |  | (42.4) |  | 312.1 |  |
U.S. agency commercial mortgage-backed securities | 510.5 |  | — |  | 510.5 |  | — |  | (52.9) |  | 457.6 |  |
U.S. agency residential mortgage-backed securities | 1,232.6 |  | — |  | 1,232.6 |  | — |  | (137.0) |  | 1,095.6 |  |
Collateralized mortgage obligations | 475.9 |  | — |  | 475.9 |  | 0.2 |  | (69.0) |  | 407.1 |  |
Corporate securities | 57.0 |  | (0.8) |  | 56.2 |  | — |  | (6.0) |  | 50.2 |  |
Total | $ | 3,208.7 |  | $ | (0.8) |  | $ | 3,207.9 |  | $ | 0.4 |  | $ | (334.3) |  | $ | 2,874.0 |  |
(1) Amortized cost presented above includes $10.7 million of unamortized gains and $18.1 million of unamortized losses related to the 2021 and 2022 transfer of securities from available-for-sale to held-to-maturity. |
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 September 30, 2024 and December 31, 2023.
| Less than 12 Months |  | 12 Months or More |  | Total
September 30, 2024 | Fair Value | Gross Unrealized Losses |  | Fair Value | Gross Unrealized Losses |  | Fair Value | Gross Unrealized Losses
Available-for-Sale: |  |  |  |  |  |  |  |
U.S. Treasury notes | $ | — |  | $ | — |  |  | $ | 231.0 |  | $ | (19.2) |  |  | $ | 231.0 |  | $ | (19.2) |
State, county, and municipal securities | — |  | — |  |  | 218.8 |  | (31.9) |  |  | 218.8 |  | (31.9) |
Obligations of U.S. government agencies | — |  | — |  |  | 165.1 |  | (6.5) |  |  | 165.1 |  | (6.5) |
U.S. agency commercial mortgage-backed securities | 0.1 |  | — |  |  | 1,048.8 |  | (60.2) |  |  | 1,048.9 |  | (60.2) |
U.S. agency residential mortgage-backed securities | — |  | — |  |  | 1,167.0 |  | (94.2) |  |  | 1,167.0 |  | (94.2) |
Collateralized mortgage obligations | 3.2 |  | — |  |  | 1,048.5 |  | (87.7) |  |  | 1,051.7 |  | (87.7) |
Private mortgage-backed securities | — |  | — |  |  | 199.5 |  | (23.7) |  |  | 199.5 |  | (23.7) |
Corporate securities | — |  | — |  |  | 217.0 |  | (14.9) |  |  | 217.0 |  | (14.9) |
Total | $ | 3.3 |  | $ | — |  |  | $ | 4,295.7 |  | $ | (338.3) |  |  | $ | 4,299.0 |  | $ | (338.3) |
| Less than 12 Months |  | 12 Months or More |  | Total
December 31, 2023 | Fair Value | Gross Unrealized Losses |  | Fair Value | Gross Unrealized Losses |  | Fair Value | Gross Unrealized Losses
Available-for-Sale: |  |  |  |  |  |  |  |
U.S. Treasury notes | $ | — |  | $ | — |  |  | $ | 224.7 |  | $ | (25.5) |  |  | $ | 224.7 |  | $ | (25.5) |
State, county, and municipal securities | — |  | — |  |  | 217.1 |  | (36.9) |  |  | 217.1 |  | (36.9) |
Obligations of U.S. government agencies | — |  | — |  |  | 168.0 |  | (10.9) |  |  | 168.0 |  | (10.9) |
U.S. agency commercial mortgage-backed securities | 0.2 |  | — |  |  | 1,083.1 |  | (87.7) |  |  | 1,083.3 |  | (87.7) |
U.S. agency residential mortgage-backed securities | 0.7 |  | — |  |  | 1,287.5 |  | (130.6) |  |  | 1,288.2 |  | (130.6) |
Collateralized mortgage obligations | — |  | — |  |  | 1,142.4 |  | (120.3) |  |  | 1,142.4 |  | (120.3) |
Private mortgage-backed securities | — |  | — |  |  | 210.5 |  | (30.9) |  |  | 210.5 |  | (30.9) |
Collateralized loan obligation | — |  | — |  |  | 935.7 |  | (2.3) |  |  | 935.7 |  | (2.3) |
Corporate securities | — |  | — |  |  | 236.5 |  | (24.4) |  |  | 236.5 |  | (24.4) |
Total | $ | 0.9 |  | $ | — |  |  | $ | 5,505.5 |  | $ | (469.5) |  |  | $ | 5,506.4 |  | $ | (469.5) |
As of September 30, 2024 and December 31, 2023, there were no holdings of securities of any issuer in an amount greater than 10% of stockholders’ equity, other than holdings in the U.S. government and its agencies. The Company determines the allowance for credit losses on both available-for-sale and held-to-maturity investment securities by a discounted cash flow approach when needed, using each 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. The allowance for credit loss on held-to-maturity investment securities is representative of current expected credit losses that management expects to be incurred over the life of the investment and established through a charge to provision for credit losses in current period earnings. For held-to-maturity investment securities, the Company has the intent and ability to hold these investment securities to maturity. The investment 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 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 September 30, 2024 and December 31, 2023, the Company had 648 and 704 individual available-for-sale investment securities, respectively, that were in an unrealized loss position, which was related primarily to fluctuations in current interest rates. The Company does not intend to sell any of the available-for-sale securities, and the Company does not anticipate it will be required to sell any securities before a recovery in cost. 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:
September 30, 2024 | AAA | AA | A | BBB | BB | Not Rated | Total
U.S. Treasury notes | $ | 99.6 |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | 99.6 |
State, county, and municipal securities | 85.7 |  | 74.2 |  | 10.1 |  | — |  | — |  | 6.7 |  | 176.7 |
Obligations of U.S. government agencies | 356.4 |  | — |  | — |  | — |  | — |  | — |  | 356.4 |
U.S. agency commercial mortgage-backed securities |  |  |  |  |  |  |
FNMA/FHLMC | 349.7 |  | — |  | — |  | — |  | — |  | — |  | 349.7 |
GNMA | 143.3 |  | — |  | — |  | — |  | — |  | — |  | 143.3 |
U.S. agency residential mortgage-backed securities |  |  |  |  |  |  |
FNMA/FHLMC | 1,080.7 |  | — |  | — |  | — |  | — |  | — |  | 1,080.7 |
GNMA | 38.8 |  | — |  | — |  | — |  | — |  | — |  | 38.8 |
Collateralized mortgage obligations |  |  |  |  |  |  |
FNMA/FHLMC | 308.5 |  | — |  | — |  | — |  | — |  | — |  | 308.5 |
GNMA | 131.3 |  | — |  | — |  | — |  | — |  | — |  | 131.3 |
Corporate securities | — |  | — |  | — |  | 47.0 |  | 5.0 |  | 5.0 |  | 57.0 |
Total | $ | 2,594.0 |  | $ | 74.2 |  | $ | 10.1 |  | $ | 47.0 |  | $ | 5.0 |  | $ | 11.7 |  | $ | 2,742.0 |
December 31, 2023 | AAA | AA | A | BBB | BB | Not Rated | Total
U.S. Treasury notes | $ | 399.0 |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | 399.0 |
State, county, and municipal securities | 69.0 |  | 92.3 |  | 10.6 |  | — |  | — |  | 7.3 |  | 179.2 |
Obligations of U.S. government agencies | 354.5 |  | — |  | — |  | — |  | — |  | — |  | 354.5 |
U.S. agency commercial mortgage-backed securities |  |  |  |  |  |  |
FNMA/FHLMC | 359.7 |  | — |  | — |  | — |  | — |  | — |  | 359.7 |
GNMA | 150.8 |  | — |  | — |  | — |  | — |  | — |  | 150.8 |
U.S. agency residential mortgage-backed securities |  |  |  |  |  |  |
FNMA/FHLMC | 1,189.8 |  | — |  | — |  | — |  | — |  | — |  | 1,189.8 |
GNMA | 42.8 |  | — |  | — |  | — |  | — |  | — |  | 42.8 |
Collateralized mortgage obligations |  |  |  |  |  |  |
FNMA/FHLMC | 334.1 |  | — |  | — |  | — |  | — |  | — |  | 334.1 |
GNMA | 141.8 |  | — |  | — |  | — |  | — |  | — |  | 141.8 |
Corporate securities | — |  | — |  | — |  | 47.0 |  | 5.0 |  | 5.0 |  | 57.0 |
Total | $ | 3,041.5 |  | $ | 92.3 |  | $ | 10.6 |  | $ | 47.0 |  | $ | 5.0 |  | $ | 12.3 |  | $ | 3,208.7 |
As of September 30, 2024 and December 31, 2023, the Company had $33.1 million and $38.5 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 September 30, 2024 and December 31, 2023, 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 September 30, 2024 and December 31, 2023, there were no collateral-dependent available-for-sale or held-to-maturity securities. There were no material gross realized gains and no material gross realized losses during the three and the nine month periods ended September 30, 2024. During the three months ended September 30, 2023, there were no material gross realized gains and no material gross realized losses, and during the nine months ended September 30, 2023 there were no material gross realized gains and $23.5 million in gross realized losses on the disposition of available-for-sale investment securities, resulting from the sale of $853.0 million of investment securities. The following schedule represents the amortized cost of debt securities by contractual maturity except for maturities of mortgage-backed securities, which have been adjusted to reflect shorter maturities based upon estimated prepayments of principal.
| Available-for-Sale |  | Held-to-Maturity
September 30, 2024 | Amortized Cost | Estimated Fair Value |  | Amortized Cost | Estimated Fair Value
Within one year | $ | 88.7 |  | $ | 87.5 |  |  | $ | 101.1 |  | $ | 100.6 |
After one year but within five years | 1,326.9 |  | 1,265.9 |  |  | 416.0 |  | 396.8 |
After five years but within ten years | 1,166.4 |  | 1,095.1 |  |  | 485.5 |  | 437.5 |
After ten years | 3,284.0 |  | 3,085.8 |  |  | 1,739.4 |  | 1,545.6 |
Total | $ | 5,866.0 |  | $ | 5,534.3 |  |  | $ | 2,742.0 |  | $ | 2,480.5 |
As of September 30, 2024, the Company held investment securities callable within one year having amortized costs and estimated fair values of $1,514.6 million and $1,478.0 million, respectively. These investment securities are primarily included in the “after five year” categories in the table above. As of September 30, 2024, the Company had no callable structured notes. As of September 30, 2024 and December 31, 2023, the Company had amortized costs of $3,159.8 million and $3,858.6 million, respectively, for investment securities pledged to secure public deposits, derivatives, and securities sold under repurchase agreements that had estimated fair values of $2,888.0 million and $3,462.2 million, as of September 30, 2024 and December 31, 2023, 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 September 30, 2024 and December 31, 2023, the Company held $155.5 million and $223.2 million, respectively, in equity securities primarily 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.

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