INVESTMENTS

3 Months Ended

Mar. 31, 2025

Investments, Debt and Equity Securities [Abstract]

For the three months ended March 31, 2025 there were $164.5 million of sales of AFS securities with $0.1 million of gross realized gains and gross realized losses of $10.0 million. For the three months ended March 31, 2024, there were $212.0 million of sales of AFS securities with $0.4 million of gross realized gains and gross realized losses of $7.9 million. Additionally in the three months ended March 31, 2024, First Financial sold its remaining Class B Visa shares, which resulted in proceeds of $11.6 million, with gross realized gains of $2.2 million, which is included in Net gain (loss) on investment securities on the Consolidated Statements of Income.

First Financial had two AFS securities totaling $11.1 million that were in unrealized loss positions at both March 31, 2025 and December 31, 2024 due to credit deterioration. The unrealized losses on these two securities totaled $1.1 million. The Company continues to monitor these securities and believes that the Company will receive the full par value of these securities.

The following is a summary of HTM and AFS investment securities as of March 31, 2025:


	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	$	(7)	$	92
Securities of U.S. government agencies and corporations	0		0		0		0		72,573		0		(8,212)		64,361
Mortgage-backed securities - residential	0		0		0		0		1,189,267		3,478		(85,010)		1,107,735
Mortgage-backed securities - commercial	30,101		0		(4,017)		26,084		332,286		424		(21,346)		311,364
Collateralized mortgage obligations	6,836		0		(647)		6,189		675,620		3,212		(44,768)		634,064
Obligations of state and other political subdivisions	8,282		29		(325)		7,986		616,286		530		(112,655)		504,161
Asset-backed securities	0		0		0		0		522,534		1,050		(15,109)		508,475
Other securities	31,250		0		(2,151)		29,099		137,756		313		(7,340)		130,729
Total	$	76,469	$	29	$	(7,140)	$	69,358	$	3,546,421	$	9,007	$	(294,447)	$	3,260,981

The following is a summary of HTM and AFS investment securities as of December 31, 2024:


	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	$	(9)	$	90
Securities of U.S. government agencies and corporations	0		0		0		0		83,224		0		(11,546)		71,678
Mortgage-backed securities - residential	0		0		0		0		1,102,242		508		(104,208)		998,542
Mortgage-backed securities - commercial	30,444		0		(4,454)		25,990		382,727		26		(25,381)		357,372
Collateralized mortgage obligations	7,007		0		(788)		6,219		620,315		1,449		(52,599)		569,165
Obligations of state and other political subdivisions	8,259		42		(339)		7,962		630,813		357		(109,904)		521,266
Asset-backed securities	0		0		0		0		555,484		998		(22,379)		534,103
Other securities	31,250		0		(2,432)		28,818		137,748		120		(6,308)		131,560
Total	$	76,960	$	42	$	(8,013)	$	68,989	$	3,512,652	$	3,458	$	(332,334)	$	3,183,776

The following table provides a summary of investment securities by contractual maturity as of March 31, 2025, 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	$	4,340	$	3,305
Due after one year through five years	5,716		5,720		142,509		128,958
Due after five years through ten years	32,298		30,115		199,185		169,149
Due after ten years	1,518		1,250		480,680		397,931
Mortgage-backed securities - residential	0		0		1,189,267		1,107,735
Mortgage-backed securities - commercial	30,101		26,084		332,286		311,364
Collateralized mortgage obligations	6,836		6,189		675,620		634,064
Asset-backed securities	0		0		522,534		508,475
Total	$	76,469	$	69,358	$	3,546,421	$	3,260,981

Unrealized gains and losses on debt securities available-for-sale are generally due to fluctuations in current market yields relative to the yields of the securities at their amortized cost. All AFS securities with unrealized losses are reviewed quarterly to determine if any impairment exists, requiring a write-down to fair value. For AFS 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 AFS securities in an unrealized loss position 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. If the present value of cash flows expected to be collected is less than the amortized cost basis for the security, a credit loss exists and an allowance for credit losses is recorded, limited to the amount that the fair value of the security is less than its amortized cost basis.

No impairment losses were recorded on investment securities in either the first quarter of 2025 or 2024. Other than two securities on which the Company recorded impairment losses in the third quarter of 2024, 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 prior to maturity or recovery of the recorded value. Additionally, based on the Company's credit assessment of AFS securities in an unrealized loss position, the Company recorded no reserves for the periods ended March 31, 2025 or December 31, 2024.

As of March 31, 2025, the Company's investment securities portfolio consisted of 762 AFS and HTM securities, of which 582 were in an unrealized loss position. As of December 31, 2024, the Company's investment securities portfolio consisted of 743 AFS and HTM securities, of which 644 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 at March 31, 2025 or December 31, 2024.

Management measures expected credit losses on HTM debt securities on a collective basis by security type. The estimate of expected credit losses considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts. The Company did not record an ACL for these securities as of March 31, 2025 or December 31, 2024.

The following tables provide the fair value and gross unrealized losses of AFS investment securities in an unrealized loss position for which an ACL 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, 2025
	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	$	92	$	(7)	$	92	$	(7)
Securities of U.S. Government agencies and corporations	0		0		64,361		(8,212)		64,361		(8,212)
Mortgage-backed securities - residential	266,946		(3,441)		485,197		(81,569)		752,143		(85,010)
Mortgage-backed securities - commercial	23,709		(59)		230,179		(21,287)		253,888		(21,346)
Collateralized mortgage obligations	88,599		(589)		288,026		(44,179)		376,625		(44,768)
Obligations of state and other political subdivisions	11,197		(171)		462,642		(112,484)		473,839		(112,655)
Asset-backed securities	129,559		(407)		85,591		(14,702)		215,150		(15,109)
Other securities	0		0		114,416		(7,340)		114,416		(7,340)
Total	$	520,010	$	(4,667)	$	1,730,504	$	(289,780)	$	2,250,514	$	(294,447)


	December 31, 2024
	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	$	90	$	(9)	$	90	$	(9)
Securities of U.S. Government agencies and corporations	0		0		71,678		(11,546)		71,678		(11,546)
Mortgage-backed securities - residential	417,516		(9,130)		503,321		(95,078)		920,837		(104,208)
Mortgage-backed securities - commercial	26,516		(67)		286,589		(25,314)		313,105		(25,381)
Collateralized mortgage obligations	120,670		(1,776)		296,813		(50,823)		417,483		(52,599)
Obligations of state and other political subdivisions	19,636		(351)		478,083		(109,553)		497,719		(109,904)
Asset-backed securities	26,389		(189)		159,135		(22,190)		185,524		(22,379)
Other securities	9,988		(12)		115,452		(6,296)		125,440		(6,308)
Total	$	620,715	$	(11,525)	$	1,911,161	$	(320,809)	$	2,531,876	$	(332,334)

The following tables provide the fair value and gross unrecognized losses of HTM investment securities in an unrecognized loss position for which an ACL 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, 2025
	Less than 12 months				12 months or more				Total
(Dollars in thousands)	Fair value		Unrecognized loss		Fair value		Unrecognized loss		Fair value		Unrecognized 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	0		0		0		0		0		0
Mortgage-backed securities - commercial	0		0		26,084		(4,017)		26,084		(4,017)
Collateralized mortgage obligations	0		0		6,189		(647)		6,189		(647)
Obligations of state and other political subdivisions	3,144		(24)		2,265		(301)		5,409		(325)
Asset-backed securities	0		0		0		0		0		0
Other securities	0		0		29,099		(2,151)		29,099		(2,151)
Total	$	3,144	$	(24)	$	63,637	$	(7,116)	$	66,781	$	(7,140)


	December 31, 2024
	Less than 12 months				12 months or more				Total
(Dollars in thousands)	Fair value		Unrecognized loss		Fair value		Unrecognized loss		Fair value		Unrecognized 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	0		0		0		0		0		0
Mortgage-backed securities - commercial	0		0		25,990		(4,454)		25,990		(4,454)
Collateralized mortgage obligations	0		0		6,219		(788)		6,219		(788)
Obligations of state and other political subdivisions	3,111		(33)		2,288		(306)		5,399		(339)
Asset-backed securities	0		0		0		0		0		0
Other securities	0		0		28,818		(2,432)		28,818		(2,432)
Total	$	3,111	$	(33)	$	63,315	$	(7,980)	$	66,426	$	(8,013)

For further detail on the fair value of investment securities, see Note 17 – Fair Value Disclosures.