INVESTMENTS

12 Months Ended

Dec. 31, 2019

Investments, Debt and Equity Securities [Abstract]

Investment Securities

During the year ended December 31, 2019, proceeds on the sale of $519.1 million of AFS securities resulted in gains of $2.1 million and losses of $2.1 million, with insignificant tax expense. During the year ended December 31, 2018, proceeds on the sale of $290.7 million of AFS securities resulted in gains of $0.5 million, losses of $0.6 million and insignificant tax expense. During the year ended December 31, 2017, proceeds on the sale of $190.0 million of AFS securities resulted in gains of $1.8 million and losses of $0.2 million in addition to tax expense of $0.6 million. In addition to the sale of certain securities, First Financial reclassified $268.7 million of HTM securities, in conjunction with the adoption of ASU 2017-12 in the first quarter of 2019, resulting in a $0.2 million realized loss recorded in the Consolidated Statement of Income. To align with post-merger investment strategies, during the second quarter 2018 First Financial sold certain securities and reclassified $372.1 million of HTM securities to AFS.

The carrying value of investment securities pledged as collateral to secure public deposits, repurchase agreements and for other purposes as required by law totaled $1.1 billion at December 31, 2019 and $1.2 billion at December 31, 2018.

The following is a summary of HTM and AFS investment securities as of December 31, 2019:



	Held-to-maturity									Available-for-sale
(Dollars in thousands)	Amortized cost		Unrecognized gain		Unrecognized loss			Fair value		Amortized cost		Unrealized gain		Unrealized loss			Fair value
U.S. Treasuries	$	0	$	0	$	0		$	0	$	99	$	1	$	0		$	100
Securities of U.S. government agencies and corporations	0		0		0			0		156		2		0			158
Mortgage-backed securities - residential	20,818		122		(174		)	20,766		421,945		9,709		(99		)	431,555
Mortgage-backed securities - commercial	101,267		571		(1,225		)	100,613		474,174		4,988		(2,644		)	476,518
Collateralized mortgage obligations	9,763		0		(108		)	9,655		769,076		16,753		(385		)	785,444
Obligations of state and other political subdivisions	11,014		804		(31		)	11,787		652,986		23,729		(462		)	676,253
Asset-backed securities	0		0		0			0		400,081		1,414		(1,064		)	400,431
Other securities	0		0		0			0		79,781		1,959		(115		)	81,625
Total	$	142,862	$	1,497	$	(1,538	)	$	142,821	$	2,798,298	$	58,555	$	(4,769	)	$	2,852,084

The following is a summary of HTM and AFS investment securities as of December 31, 2018:



	Held-to-maturity									Available-for-sale
(Dollars in thousands)	Amortized cost		Unrecognized gain		Unrecognized loss			Fair value		Amortized cost		Unrealized gain		Unrealized loss			Fair value
U.S. Treasuries	$	0	$	0	$	0		$	0	$	99	$	0	$	(2	)	$	97
Securities of U.S. government agencies and corporations	0		0		0			0		32,095		57		(233		)	31,919
Mortgage-backed securities - residential	25,565		0		(1,045		)	24,520		565,071		691		(7,163		)	558,599
Mortgage-backed securities - commercial	147,780		258		(4,385		)	143,653		423,797		819		(3,581		)	421,035
Collateralized mortgage obligations	12,540		0		(633		)	11,907		928,586		4,319		(6,158		)	926,747
Obligations of state and other political subdivisions	243,443		1,954		(1,359		)	244,038		257,300		2,554		(1,429		)	258,425
Asset-backed securities	0		0		0			0		511,430		611		(2,810		)	509,231
Other securities	0		0		0			0		73,948		358		(1,104		)	73,202
Total	$	429,328	$	2,212	$	(7,422	)	$	424,118	$	2,792,326	$	9,409	$	(22,480	)	$	2,779,255

The following table provides a summary of investment securities by contractual maturity as of December 31, 2019, except for residential and commercial mortgage-backed securities, collateralized mortgage obligations and asset-backed securities, which are shown as single totals, due to the unpredictability of the timing in principal repayments:



	Held-to-maturity				Available-for-sale
(Dollars in thousands)	Amortized cost		Fair value		Amortized cost		Fair value
Due in one year or less	$	0	$	0	$	7,382	$	7,408
Due after one year through five years	0		0		52,075		53,189
Due after five years through ten years	4,756		5,417		144,626		149,961
Due after ten years	6,258		6,370		528,939		547,578
Mortgage-backed securities - residential	20,818		20,766		421,945		431,555
Mortgage-backed securities - commercial	101,267		100,613		474,174		476,518
Collateralized mortgage obligations	9,763		9,655		769,076		785,444
Asset-backed securities	0		0		400,081		400,431
Total	$	142,862	$	142,821	$	2,798,298	$	2,852,084

Unrealized gains and losses on debt securities are generally due to fluctuations in current market yields relative to the yields of the securities at their amortized cost. All securities with unrealized losses are reviewed quarterly to determine if any impairment is considered other than temporary, requiring a write-down to fair value. First Financial considers the percentage loss on a security, duration of the loss, average life or duration of the security, credit rating of the security and payment performance, in addition to the Company’s intent and ability to hold the security to maturity, when determining whether any impairment is other than temporary. At this time First Financial does not intend to sell, and it is not more likely than not that the Company will be required to sell, debt securities temporarily impaired prior to maturity or recovery of the recorded value. First Financial had no other than temporary impairment related to its investment securities portfolio as of December 31, 2019, 2018 or 2017.

As of December 31, 2019, the Company's investment securities portfolio consisted of 1,273 securities, of which 140 securities were in an unrealized loss position. As of December 31, 2018, the Company's investment securities portfolio consisted of 1,417 securities, of which 504 were in an unrealized loss position.

The following tables provide the fair value and gross unrealized losses on investment securities in an unrealized loss position, aggregated by investment category and the length of time the individual securities have been in a continuous loss position:



	December 31, 2019
	Less than 12 months					12 months or more					Total
(Dollars in thousands)	Fair value		Unrealized loss			Fair value		Unrealized loss			Fair value		Unrealized loss
U.S. Treasuries	$	0	$	0		$	0	$	0		$	0	$	0
Securities of U.S. government agencies and corporations	0		0			0		0			0		0
Mortgage-backed securities - residential	40,190		(209		)	11,063		(64		)	51,253		(273		)
Mortgage-backed securities - commercial	111,658		(298		)	104,069		(3,571		)	215,727		(3,869		)
Collateralized mortgage obligations	85,248		(297		)	30,628		(196		)	115,876		(493		)
Obligations of state and other political subdivisions	118,623		(457		)	7,950		(36		)	126,573		(493		)
Asset-backed securities	125,889		(553		)	54,963		(511		)	180,852		(1,064		)
Other securities	0		0			5,649		(115		)	5,649		(115		)
Total	$	481,608	$	(1,814	)	$	214,322	$	(4,493	)	$	695,930	$	(6,307	)



	December 31, 2018
	Less than 12 months					12 months or more					Total
(Dollars in thousands)	Fair value		Unrealized loss			Fair value		Unrealized loss			Fair value		Unrealized loss
U.S. Treasuries	$	0	$	0		$	97	$	(2	)	$	97	$	(2	)
Securities of U.S. Government agencies and corporations	0		0			16,777		(233		)	16,777		(233		)
Mortgage-backed securities - residential	186,029		(935		)	264,795		(7,273		)	450,824		(8,208		)
Mortgage-backed securities - commercial	147,754		(369		)	232,363		(7,597		)	380,117		(7,966		)
Collateralized mortgage obligations	194,795		(1,546		)	240,514		(5,245		)	435,309		(6,791		)
Obligations of state and other political subdivisions	62,805		(299		)	86,644		(2,489		)	149,449		(2,788		)
Asset-backed securities	336,437		(2,312		)	37,105		(498		)	373,542		(2,810		)
Other securities	33,752		(884		)	4,570		(220		)	38,322		(1,104		)
Total	$	961,572	$	(6,345	)	$	882,865	$	(23,557	)	$	1,844,437	$	(29,902	)

For further detail on the fair value of investment securities, see Note 22 – Fair Value Disclosures.