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INVESTMENT SECURITIES | 12 Months Ended
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Dec. 31, 2023
Investments, Debt and Equity Securities [Abstract] |
INVESTMENT SECURITIES | INVESTMENT SECURITIES: The following tables set forth certain information regarding the amortized cost basis and fair values of our investment securities AFS and HTM:
| At December 31, 2023
(in thousands) | Amortized cost |  | Gross unrealized gains |  | Gross unrealized losses |  | Fair value
AFS |  |  |  |  |  |  |
Mortgage-backed securities ("MBS"): |  |  |  |  |  |  |
Residential | $ | 194,141 |  |  | $ | 117 |  |  | $ | (10,460) |  |  | $ | 183,798 |
Commercial | 55,235 |  |  | — |  |  | (7,479) |  |  | 47,756 |
Collateralized mortgage obligations ("CMOs") |  |  |  |  |  |  |
Residential | 473,269 |  |  | 8 |  |  | (33,539) |  |  | 439,738 |
Commercial | 63,456 |  |  | — |  |  | (6,059) |  |  | 57,397 |
Municipal bonds | 452,057 |  |  | 670 |  |  | (47,853) |  |  | 404,874 |
Corporate debt securities | 45,611 |  |  | 34 |  |  | (7,098) |  |  | 38,547 |
U.S. Treasury securities | 22,658 |  |  | — |  |  | (2,474) |  |  | 20,184 |
Agency debentures | 60,202 |  |  | 5 |  |  | (1,302) |  |  | 58,905 |
Total | $ | 1,366,629 |  |  | $ | 834 |  |  | $ | (116,264) |  |  | $ | 1,251,199 |
HTM |  |  |  |  |  |  |
Municipal bonds | $ | 2,371 |  |  | $ | — |  |  | $ | (40) |  |  | $ | 2,331 |
| At December 31, 2022
(in thousands) | Amortized cost |  | Gross unrealized gains |  | Gross unrealized losses |  | Fair value
AFS |  |  |  |  |  |  |
MBS: |  |  |  |  |  |  |
Residential | $ | 207,445 |  |  | $ | — |  |  | $ | (10,183) |  |  | $ | 197,262 |
Commercial | 65,411 |  |  | — |  |  | (9,362) |  |  | 56,049 |
CMOs: |  |  |  |  |  |  |
Residential | 592,449 |  |  | 12 |  |  | (39,422) |  |  | 553,039 |
Commercial | 77,909 |  |  | — |  |  | (7,390) |  |  | 70,519 |
Municipal bonds | 469,346 |  |  | 41 |  |  | (57,839) |  |  | 411,548 |
Corporate debt securities | 46,672 |  |  | 74 |  |  | (3,801) |  |  | 42,945 |
U.S. Treasury securities | 23,005 |  |  | — |  |  | (3,071) |  |  | 19,934 |
Agency debentures | 27,499 |  |  | 8 |  |  | (29) |  |  | 27,478 |
Total | $ | 1,509,736 |  |  | $ | 135 |  |  | $ | (131,097) |  |  | $ | 1,378,774 |
HTM |  |  |  |  |  |  |
Municipal bonds | $ | 2,441 |  |  | $ | — |  |  | $ | (56) |  |  | $ | 2,385 |
At December 31, 2023 and 2022 the Company held $25 million and $19 million, respectively, of trading securities consisting of U.S. Treasury notes used as economic hedges of our single family mortgage servicing rights, which are carried at fair value and included with investment securities on the balance sheet. For 2023 and 2022 net losses of $0.5 million and $7.0 million on trading securities, respectively, were recorded in servicing income. MBS and CMOs represent securities issued or guaranteed by government sponsored enterprises ("GSEs"). Most of the MBS and CMO securities in our investment portfolio are guaranteed by Fannie Mae, Ginnie Mae or Freddie Mac. Municipal bonds are comprised of general obligation bonds (i.e., backed by the general credit of the issuer) and revenue bonds (i.e., backed by either collateral or revenues from the specific project being financed) issued by various municipal organizations. As of December 31, 2023 and 2022, substantially all securities held, including municipal bonds and corporate debt securities, were rated investment grade based upon nationally recognized statistical rating organizations where available and, where not available, based upon internal ratings. Investment securities AFS that were in an unrealized loss position are presented in the following tables based on the length of time the individual securities have been in an unrealized loss position:
| At December 31, 2023
| Less than 12 months |  | 12 months or more |  | Total
(in thousands) | Gross unrealized losses |  | Fair value |  | Gross unrealized losses |  | Fair value |  | Gross unrealized losses |  | Fair value
AFS |  |  |  |  |  |  |  |  |  |  |
MBS: |  |  |  |  |  |  |  |  |  |  |
Residential | $ | (3) |  |  | $ | 1,145 |  |  | $ | (10,457) |  |  | $ | 177,393 |  |  | $ | (10,460) |  |  | $ | 178,538 |
Commercial | — |  |  | 61 |  |  | (7,479) |  |  | 47,695 |  |  | (7,479) |  |  | 47,756 |
CMOs: |  |  |  |  |  |  |  |  |  |  |
Residential | (368) |  |  | 83,815 |  |  | (33,171) |  |  | 348,914 |  |  | (33,539) |  |  | 432,729 |
Commercial | — |  |  | — |  |  | (6,059) |  |  | 57,397 |  |  | (6,059) |  |  | 57,397 |
Municipal bonds | (73) |  |  | 7,489 |  |  | (47,780) |  |  | 364,775 |  |  | (47,853) |  |  | 372,264 |
Corporate debt securities | — |  |  | — |  |  | (7,098) |  |  | 28,513 |  |  | (7,098) |  |  | 28,513 |
U.S. Treasury securities | — |  |  | — |  |  | (2,474) |  |  | 20,184 |  |  | (2,474) |  |  | 20,184 |
Agency debentures | (135) |  |  | 42,897 |  |  | (1,167) |  |  | 11,003 |  |  | (1,302) |  |  | 53,900 |
Total | $ | (579) |  |  | $ | 135,407 |  |  | $ | (115,685) |  |  | $ | 1,055,874 |  |  | $ | (116,264) |  |  | $ | 1,191,281 |
HTM |  |  |  |  |  |  |  |  |  |  |
Municipal bonds | $ | — |  |  | $ | — |  |  | $ | (40) |  |  | $ | 2,331 |  |  | $ | (40) |  |  | $ | 2,331 |
| At December 31, 2022
| Less than 12 months |  | 12 months or more |  | Total
(in thousands) | Gross unrealized losses |  | Fair value |  | Gross unrealized losses |  | Fair value |  | Gross unrealized losses |  | Fair value
AFS |  |  |  |  |  |  |  |  |  |  |
MBS: |  |  |  |  |  |  |  |  |  |  |
Residential | $ | (8,845) |  |  | $ | 191,398 |  |  | $ | (1,338) |  |  | $ | 5,763 |  |  | $ | (10,183) |  |  | $ | 197,161 |
Commercial | (5,729) |  |  | 41,416 |  |  | (3,633) |  |  | 14,619 |  |  | (9,362) |  |  | 56,035 |
CMOs: |  |  |  |  |  |  |  |  |  |  |
Residential | (27,789) |  |  | 498,333 |  |  | (11,633) |  |  | 45,689 |  |  | (39,422) |  |  | 544,022 |
Commercial | (4,787) |  |  | 56,671 |  |  | (2,603) |  |  | 13,848 |  |  | (7,390) |  |  | 70,519 |
Municipal bonds | (44,513) |  |  | 350,918 |  |  | (13,326) |  |  | 46,377 |  |  | (57,839) |  |  | 397,295 |
Corporate debt securities | (3,801) |  |  | 32,871 |  |  | — |  |  | — |  |  | (3,801) |  |  | 32,871 |
U.S. Treasury securities | — |  |  | — |  |  | (3,071) |  |  | 19,934 |  |  | (3,071) |  |  | 19,934 |
Agency debentures | (29) |  |  | 15,970 |  |  | — |  |  | — |  |  | (29) |  |  | 15,970 |
Total | $ | (95,493) |  |  | $ | 1,187,577 |  |  | $ | (35,604) |  |  | $ | 146,230 |  |  | $ | (131,097) |  |  | $ | 1,333,807 |
HTM |  |  |  |  |  |  |  |  |  |  |
Municipal bonds | $ | (56) |  |  | $ | 2,385 |  |  | $ | — |  |  | $ | — |  |  | $ | (56) |  |  | $ | 2,385 |
The Company has evaluated AFS securities in an unrealized loss position and has determined that the decline in value is temporary and is related to the change in market interest rates since purchase. The decline in value is not related to any issuer- or industry-specific credit event. The Company has not identified any expected credit losses on its debt securities as of December 31, 2023 and 2022. The Company bases this conclusion in part on its periodic review of the credit ratings of the AFS securities or reviews of the financial condition of the issuers. In addition, as of December 31, 2023 and 2022, the Company had not made a decision to sell any of its debt securities held, nor did the Company consider it more likely than not that it would be required to sell such securities before recovery of their amortized cost basis. The following tables present the fair value of investment securities AFS and HTM by contractual maturity along with the associated contractual yield.
| At December 31, 2023
| Within one year |  | After one year through five years |  | After five years through ten years |  | After ten years |  | Total
(dollars in thousands) | Fair Value |  | Weighted Average Yield |  | Fair Value |  | Weighted Average Yield |  | Fair Value |  | Weighted Average Yield |  | Fair Value |  | Weighted Average Yield |  | Fair Value |  | Weighted Average Yield
AFS |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Municipal bonds | $ | — |  |  | — | % |  | $ | 5,856 |  |  | 1.84 | % |  | $ | 60,775 |  |  | 3.36 | % |  | $ | 338,243 |  |  | 3.01 | % |  | $ | 404,874 |  |  | 3.04 | %
Corporate debt securities | 4,425 |  |  | 3.53 | % |  | 12,714 |  |  | 4.95 | % |  | 21,408 |  |  | 3.89 | % |  | — |  |  | — | % |  | 38,547 |  |  | 4.21 | %
U.S. Treasury securities | — |  |  | — | % |  | 20,184 |  |  | 1.14 | % |  | — |  |  | — | % |  | — |  |  | — | % |  | 20,184 |  |  | 1.14 | %
Agency debentures | 16,977 |  |  | 4.93 | % |  | 30,925 |  |  | 5.20 | % |  | 7,758 |  |  | 2.15 | % |  | 3,245 |  |  | 2.17 | % |  | 58,905 |  |  | 4.51 | %
Total | $ | 21,402 |  |  | 4.64 | % |  | $ | 69,679 |  |  | 3.64 | % |  | $ | 89,941 |  |  | 3.40 | % |  | $ | 341,488 |  |  | 3.00 | % |  | $ | 522,510 |  |  | 3.21 | %
HTM |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Municipal bonds | $ | — |  |  | — | % |  | $ | 2,331 |  |  | 2.29 | % |  | $ | — |  |  | — | % |  | $ | — |  |  | — | % |  | $ | 2,331 |  |  | 2.29 | %
| At December 31, 2022
| Within one year |  | After one year through five years |  | After five years through ten years |  | After ten years |  | Total
(dollars in thousands) | Fair Value |  | Weighted Average Yield |  | Fair Value |  | Weighted Average Yield |  | Fair Value |  | Weighted Average Yield |  | Fair Value |  | Weighted Average Yield |  | Fair Value |  | Weighted Average Yield
AFS |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Municipal bonds | $ | — |  |  | — | % |  | $ | 3,644 |  |  | 1.96 | % |  | $ | 38,977 |  |  | 3.04 | % |  | $ | 368,927 |  |  | 2.83 | % |  | $ | 411,548 |  |  | 2.84 | %
Corporate debt securities | — |  |  | — | % |  | 15,342 |  |  | 5.13 | % |  | 27,603 |  |  | 4.25 | % |  | — |  |  | — | % |  | 42,945 |  |  | 4.54 | %
U.S. Treasury securities | — |  |  | — | % |  | — |  |  | — | % |  | 19,934 |  |  | 1.11 | % |  | — |  |  | — | % |  | 19,934 |  |  | 1.11 | %
Agency debentures | 10,485 |  |  | 4.74 | % |  | 16,993 |  |  | 4.94 | % |  | — |  |  | — | % |  | — |  |  | — | % |  | 27,478 |  |  | 4.86 | %
Total | $ | 10,485 |  |  | 4.74 | % |  | $ | 35,979 |  |  | 4.69 | % |  | $ | 86,514 |  |  | 2.97 | % |  | $ | 368,927 |  |  | 2.83 | % |  | $ | 501,905 |  |  | 3.01 | %
HTM |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Municipal bonds | $ | — |  |  | — | % |  | $ | 2,385 |  |  | 2.04 | % |  | $ | — |  |  | — | % |  | $ | — |  |  | — | % |  | $ | 2,385 |  |  | 2.04 | %
The weighted-average yield is computed using the contractual coupon for each security weighted based on the fair value of each security. MBS and CMOs are excluded from the tables above because such securities are not due on a single maturity date. The weighted average yield of MBS and CMOs as of December 31, 2023 and 2022 was 3.21% and 3.08%, respectively. Sales of AFS investment securities were as follows:
| Years Ended December 31,
(in thousands) | 2023 |  | 2022 |  | 2021
Proceeds | $ | 4,693 |  |  | $ | 98,915 |  |  | $ | 28,187 |
Gross gains | 3 |  |  | 1,585 |  |  | 288 |
Gross losses | — |  |  | (1,561) |  |  | (226) |
The following table summarizes the carrying value of securities pledged as collateral to secure public deposits, borrowings and other purposes as permitted or required by law.
| At December 31,
(in thousands) | 2023 |  | 2022
Federal Reserve Bank to secure borrowings | $ | 647,104 |  |  | $ | — |
Washington, Oregon and California State to secure public deposits | 10,654 |  |  | 212,806 |
Other securities pledged | 1,440 |  |  | 2,011 |
Total securities pledged as collateral | $ | 659,198 |  |  | $ | 214,817 |
The Company assesses the creditworthiness of the counterparties that hold the pledged collateral and has determined that these arrangements have little credit risk. Tax-exempt interest income on investment securities was $11.3 million, $11.9 million and $10.2 million for 2023, 2022 and 2021, respectively.

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