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INVESTMENTS | 3 Months Ended
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Mar. 31, 2020
Investments, Debt and Equity Securities [Abstract] |
INVESTMENTS | INVESTMENTS For the three months ended March 31, 2020, there were sales of $29.9 million of AFS securities with no gross realized gains and $0.1 million gross realized losses. For the three months ended March 31, 2019, there were no sales of AFS securities and therefore no associated gains or losses. In conjunction with the adoption of ASU 2017-12 in the first quarter of 2019, First Financial reclassified $268.7 million of HTM securities to AFS resulting in a $0.2 million realized loss recorded in the Consolidated Statement of Income. The following is a summary of HTM and AFS investment securities as of March 31, 2020:
|  | 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 |  |  | $ | 5 |  |  | $ | 0 |  |  | $ | 104 |
Securities of U.S. government agencies and corporations |  | 0 |  |  | 0 |  |  | 0 |  |  | 0 |  |  | 116 |  |  | 2 |  |  | 0 |  |  | 118 |
Mortgage-backed securities - residential |  | 19,832 |  |  | 1,046 |  |  | 0 |  |  | 20,878 |  |  | 419,423 |  |  | 19,215 |  |  | (219 | ) |  | 438,419 |
Mortgage-backed securities - commercial |  | 97,073 |  |  | 1,671 |  |  | (375 | ) |  | 98,369 |  |  | 506,343 |  |  | 7,034 |  |  | (9,082 | ) |  | 504,295 |
Collateralized mortgage obligations |  | 9,043 |  |  | 149 |  |  | 0 |  |  | 9,192 |  |  | 745,649 |  |  | 28,845 |  |  | (2,479 | ) |  | 772,015 |
Obligations of state and other political subdivisions |  | 10,796 |  |  | 830 |  |  | 0 |  |  | 11,626 |  |  | 723,470 |  |  | 30,576 |  |  | (152 | ) |  | 753,894 |
Asset-backed securities |  | 0 |  |  | 0 |  |  | 0 |  |  | 0 |  |  | 382,415 |  |  | 225 |  |  | (18,841 | ) |  | 363,799 |
Other securities |  | 0 |  |  | 0 |  |  | 0 |  |  | 0 |  |  | 79,840 |  |  | 90 |  |  | (3,886 | ) |  | 76,044 |
Total |  | $ | 136,744 |  |  | $ | 3,696 |  |  | $ | (375 | ) |  | $ | 140,065 |  |  | $ | 2,857,355 |  |  | $ | 85,992 |  |  | $ | (34,659 | ) |  | $ | 2,908,688 |
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 table provides a summary of investment securities by contractual maturity as of March 31, 2020, 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
By Contractual Maturity: |  |  |  |  |  |  |  |
Due in one year or less |  | $ | 0 |  |  | $ | 0 |  |  | $ | 5,138 |  |  | $ | 5,157 |
Due after one year through five years |  | 0 |  |  | 0 |  |  | 55,648 |  |  | 56,434 |
Due after five years through ten years |  | 4,797 |  |  | 5,476 |  |  | 148,614 |  |  | 147,686 |
Due after ten years |  | 5,999 |  |  | 6,150 |  |  | 594,125 |  |  | 620,883 |
Mortgage-backed securities - residential |  | 19,832 |  |  | 20,878 |  |  | 419,423 |  |  | 438,419 |
Mortgage-backed securities - commercial |  | 97,073 |  |  | 98,369 |  |  | 506,343 |  |  | 504,295 |
Collateralized mortgage obligations |  | 9,043 |  |  | 9,192 |  |  | 745,649 |  |  | 772,015 |
Asset-backed securities |  | 0 |  |  | 0 |  |  | 382,415 |  |  | 363,799 |
Total |  | $ | 136,744 |  |  | $ | 140,065 |  |  | $ | 2,857,355 |  |  | $ | 2,908,688 |
Unrealized gains and losses on debt securities are generally due to fluctuations in current market yields relative to the yields of the debt 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. For securities in an unrealized loss position, the Company first assesses whether it intends to sell, or it is more likely than not that it will be required to sell the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value through income. For debt securities available-for-sale that do not meet the aforementioned criteria, the Company evaluates whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, management considers the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency and adverse conditions specifically related to the security, among other factors. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. 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 March 31, 2020 or December 31, 2019. As of March 31, 2020, the Company's investment securities portfolio consisted of 1,276 securities, of which 194 were in an unrealized loss position. As of December 31, 2019, the Company's investment securities portfolio consisted of 1,273 securities, of which 140 were in an unrealized loss position. Primarily all of First Financial’s HTM debt securities are issued by U.S. government-sponsored enterprises. These securities carry the explicit and/or implicit guarantee of the U.S. government, are widely recognized as “risk free,” and have a long history of zero credit loss. The remainder of the Company's HTM securities are non-agency collateralized mortgage obligations and obligations of state and other political subdivisions which currently carry ratings no lower than A+. There were no HTM securities on nonaccrual status or past due as of March 31, 2020. Therefore, the Company did not record an allowance for credit losses for these securities as of March 31, 2020. The following tables provide the fair value and gross unrealized losses on investment securities in an unrealized loss position for which an allowance for credit losses has not been recorded, aggregated by investment category and the length of time the individual securities have been in a continuous loss position:
|  | March 31, 2020
|  | 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 |  | 37,185 |  |  | (219 | ) |  | 0 |  |  | 0 |  |  | 37,185 |  |  | (219 | )
Mortgage-backed securities - commercial |  | 188,990 |  |  | (4,567 | ) |  | 62,083 |  |  | (4,890 | ) |  | 251,073 |  |  | (9,457 | )
Collateralized mortgage obligations |  | 115,697 |  |  | (1,847 | ) |  | 8,267 |  |  | (632 | ) |  | 123,964 |  |  | (2,479 | )
Obligations of state and other political subdivisions |  | 33,083 |  |  | (148 | ) |  | 1,681 |  |  | (4 | ) |  | 34,764 |  |  | (152 | )
Asset-backed securities |  | 279,980 |  |  | (16,048 | ) |  | 59,852 |  |  | (2,793 | ) |  | 339,832 |  |  | (18,841 | )
Other securities |  | 46,746 |  |  | (3,081 | ) |  | 4,010 |  |  | (805 | ) |  | 50,756 |  |  | (3,886 | )
Total |  | $ | 701,681 |  |  | $ | (25,910 | ) |  | $ | 135,893 |  |  | $ | (9,124 | ) |  | $ | 837,574 |  |  | $ | (35,034 | )
|  | December 31, 2019
|  | Less than 12 months |  | 12 months or more |  | Total
|  | Fair |  | Unrealized |  | Fair |  | Unrealized |  | Fair |  | Unrealized
(Dollars in thousands) |  | value |  | loss |  | value |  | loss |  | value |  | 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 | )
For further detail on the fair value of investment securities, see Note 16 – Fair Value Disclosures.

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