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INVESTMENT SECURITIES

12 Months Ended

Dec. 31, 2022

Investments, Debt and Equity Securities [Abstract]

INVESTMENT SECURITIES

INVESTMENT SECURITIES

The following table presents the amortized cost and fair value of the investment securities portfolio as of the dates indicated:

($ in thousands)						Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses						Fair Value
December 31, 2022
Securities held-to-maturity:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities						$	153,033					$	—					$	(29,807)					$	123,226
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations						61,404						—						(11,946)						49,458
Municipal securities						114,204						—						(24,428)						89,776
Total securities held-to-maturity						$	328,641					$	—					$	(66,181)					$	262,460
Securities available-for-sale:
SBA loan pool securities						$	11,241					$	—					$	(54)					$	11,187
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities						40,431						—						(225)						40,206
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations						99,075						—						(5,884)						93,191
Non-agency residential mortgage-backed securities						90,832						—						(10,340)						80,492
Collateralized loan obligations						492,203						—						(15,600)						476,603
Corporate debt securities						175,781						32						(9,195)						166,618
Total securities available-for-sale						$	909,563					$	32					$	(41,298)					$	868,297
December 31, 2021
Securities available-for-sale:
SBA loan pool securities						$	14,679					$	—					$	(88)					$	14,591
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities						190,382						2,898						$	(1,311)					191,969
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations						242,458						1,171						(2,088)						241,541
Municipal securities						117,913						2,641						(1,539)						119,015
Non-agency residential mortgage-backed securities						56,014						11						—						56,025
Collateralized loan obligations						521,275						—						(2,311)						518,964
Corporate debt securities						162,002						11,603						(7)						173,598
Total securities available-for-sale						$	1,304,723					$	18,324					$	(7,344)					$	1,315,703

During the first quarter of 2022, certain longer-duration fixed-rate mortgage-backed securities and municipal securities with an amortized cost basis of $346.0 million were transferred from the available-for-sale portfolio to the held-to-maturity portfolio. At the time of the transfer, the securities had an unrealized gross loss of $16.6 million, which became part of the securities' amortized cost basis. This amount, along with the unrealized loss included in accumulated other comprehensive income, is then amortized over the life of the security as an adjustment to its yield using the interest method. As a result, there is no impact on the consolidated statements of operations.

At December 31, 2022, our investment securities portfolio consisted of agency securities, municipal securities, mortgage-backed securities, collateralized loan obligations, and corporate debt securities. The expected maturities of these types of securities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

There was no allowance for credit losses for debt securities held-to-maturity and available-for-sale as of December 31, 2022 and 2021. We do not consider unrealized losses on these securities to be attributable to credit-related factors, as the unrealized losses have occurred as a result of changes in non-credit related factors such as interest rates, market spreads, and market conditions subsequent to purchase.

Accrued interest receivable on debt securities held-to-maturity and available-for-sale totaled $9.2 million and $4.7 million at December 31, 2022 and December 31, 2021, and is included within other assets in the accompanying consolidated statements of financial condition.

At December 31, 2022 and 2021, there were no holdings of any one issuer, other than the U.S. government agency and sponsored enterprises, in an amount greater than 10% of our stockholders’ equity.

Pledged Securities

Investment securities with carrying values of $356.5 million and $28.9 million as of December 31, 2022 and 2021 were pledged to secure FHLB advances, public deposits and for other purposes as required or permitted by law.

Securities Available-for-Sale

The following table presents proceeds from sales and calls of securities available-for-sale and the associated gross gains and losses realized through earnings upon the sales and calls of securities available-for-sale for the periods indicated:

						Year Ended December 31,
($ in thousands)						2022						2021						2020
Gross realized gains on sales and calls						$	209					$	—					$	2,011
Gross realized losses on sales and calls						(7,901)						—						—
Net realized (losses) gains on sales and calls						$	(7,692)					$	—					$	2,011
Proceeds from sales and calls						$	167,295					$	191,230					$	68,829

The following table summarizes the investment securities available-for-sale with unrealized losses by security type and length of time in a continuous, unrealized loss position as of the dates indicated:

						Less Than 12 Months												12 Months or Longer												Total
($ in thousands)						Fair Value						Gross Unrealized Losses						Fair Value						Gross Unrealized Losses						Fair Value						Gross Unrealized Losses
December 31, 2022
Securities available-for-sale:
SBA loan pool securities						$	2,260					$	(3)					$	8,927					$	(51)					$	11,187					$	(54)
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities						40,206						(225)						—						—						40,206						(225)
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations						76,441						(2,533)						16,750						(3,351)						93,191						(5,884)
Non-agency residential mortgage-backed securities						80,492						(10,340)						—						—						80,492						(10,340)
Collateralized loan obligations						235,936						(7,492)						240,667						(8,108)						476,603						(15,600)
Corporate debt securities						159,492						(8,374)						4,180						(821)						163,672						(9,195)
Total securities available-for-sale						$	594,827					$	(28,967)					$	270,524					$	(12,331)					$	865,351					$	(41,298)
December 31, 2021
Securities available-for-sale:
SBA loan pool securities						$	—					$	—					$	14,591					$	(88)					$	14,591					$	(88)
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities						67,588						(1,311)						—						—						67,588						(1,311)
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations						85,290						(1,184)						17,754						(904)						103,044						(2,088)
Municipal securities						44,748						(919)						10,762						(620)						55,510						(1,539)
Collateralized loan obligations						81,962						(38)						253,002						(2,273)						334,964						(2,311)
Corporate debt securities						4,993						(7)						—						—						4,993						(7)
Total securities available-for-sale						$	284,581					$	(3,459)					$	296,109					$	(3,885)					$	580,690					$	(7,344)

At December 31, 2022, our securities available-for-sale portfolio consisted of 77 securities, of which 76 securities were in an unrealized loss position. At December 31, 2021, our securities available-for-sale portfolio consisted of 119 securities, of which 46 securities were in an unrealized loss position.

During the years ended December 31, 2022, 2021 and 2020, there was no provision for credit losses related to securities available-for-sale. We monitor our securities portfolio to ensure it has adequate credit support. We consider the lowest credit rating for identification of credit impairment for collateralized loan obligations and other securities. The decline in fair value of our securities since acquisition was attributable to a combination of rising interest rates and general volatility in credit market conditions. We do not currently intend to sell any of the securities in an unrealized loss position and further believe, it is more likely than not, that we will not be required to sell these securities before their anticipated recovery. As of December 31, 2022, all of our collateralized loan obligations investment securities in an unrealized loss position received an investment grade credit rating.

The following table presents the amortized cost and fair value of the investment securities portfolio, based on the earlier of contractual maturity dates or next repricing date, as of December 31, 2022:

						Held-to-Maturity												Available-for-Sale
($ in thousands)						Amortized Cost						Fair Value						Amortized Cost						Fair Value
Earlier of maturity or next repricing date:
Within one year						$	—					$	—					$	509,099					$	493,321
One to five years						—						—						171,497						161,681
Five to ten years						28,675						24,039						42,590						37,796
Greater than ten years						299,966						238,421						186,377						175,499
Total						$	328,641					$	262,460					$	909,563					$	868,297

Contractual maturities may not reflect the actual maturities of the investments. The average lives for mortgage-backed securities and collateralized loan obligations will likely be shorter than their contractual maturities due to prepayments and amortization.

The following table presents the fair value and weighted average yields using amortized cost of the securities held-to-maturity portfolio as of December 31, 2022, based on the earlier of contractual maturity dates or next repricing dates:

						One year or less												More than One Year through Five Years												More than Five Years through Ten Years												More than Ten Years												Total
($ 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
Securities held-to-maturity:
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities						$	—					—		%				$	—					—		%				$	7,987					2.52		%				$	115,239					2.70		%				$	123,226					2.69		%
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations						—						—		%				—						—		%				—						—		%				49,458						2.64		%				49,458						2.64		%
Municipal securities						—						—		%				—						—		%				16,052						2.19		%				73,724						2.71		%				89,776						2.62		%
Total securities held-to-maturity						$	—					—		%				$	—					—		%				$	24,039					2.29		%				$	238,421					2.69		%				$	262,460					2.65		%

The following table presents the fair value and weighted average yields using amortized cost of the securities available-for-sale portfolio, as of December 31, 2022, based on the earlier of contractual maturity dates or next repricing dates:

						One year or less												More than One Year through Five Years												More than Five Years through Ten Years												More than Ten Years												Total
($ 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
Securities available-for-sale:
SBA loan pool securities						$	11,187					3.18		%				$	—					—		%				$	—					—		%				$	—					—		%				$	11,187					3.18		%
U.S. government agency and U.S. government sponsored enterprise residential mortgage-backed securities						—						—		%				—						—		%				—						—		%				40,206						5.59		%				40,206						5.59		%
U.S. government agency and U.S. government sponsored enterprise collateralized mortgage obligations						5,531						4.65		%				7,941						3.24		%				24,918						2.76		%				54,801						4.80		%				93,191						4.04		%
Non-agency residential mortgage-backed securities						—						—		%				—						—		%				—						—		%				80,492						3.68		%				80,492						3.68		%
Collateralized loan obligations						476,603						5.85		%				—						—		%				—						—		%				—						—		%				476,603						5.85		%
Corporate debt securities						—						—		%				153,740						4.82		%				12,878						5.73		%				—						—		%				166,618						4.89		%
Total securities available-for-sale						$	493,321					5.78		%				$	161,681					4.74		%				$	37,796					3.69		%				$	175,499					4.42		%				$	868,297					5.20		%

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- References

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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)

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