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SECURITIES | 12 Months Ended
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Dec. 31, 2023
Investments, Debt and Equity Securities [Abstract] |
SECURITIES | The amortized cost, gross unrealized gains and losses, and estimated fair value of securities at December 31, 2023 and December 31, 2022 are summarized as follows (in thousands):
| December 31, 2023
| Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Allowance for Credit Losses |  | Fair Value
Available-for-Sale: |  |  |  |  |  |  |  |  |
U.S. Government and agency obligations | $ | 34,929 |  |  | $ | — |  |  | $ | (740) |  |  | $ | — |  |  | $ | 34,189 |
Municipal bonds | 161,264 |  |  | 832 |  |  | (29,191) |  |  | — |  |  | 132,905 |
Corporate bonds | 131,291 |  |  | — |  |  | (12,168) |  |  | — |  |  | 119,123 |
Mortgage-backed or related securities | 2,179,947 |  |  | 942 |  |  | (314,175) |  |  | — |  |  | 1,866,714 |
Asset-backed securities | 222,549 |  |  | 300 |  |  | (1,997) |  |  | — |  |  | 220,852 |
| $ | 2,729,980 |  |  | $ | 2,074 |  |  | $ | (358,271) |  |  | $ | — |  |  | $ | 2,373,783 |
| December 31, 2023
| Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value |  | Allowance for Credit Losses
Held-to-Maturity: |  |  |  |  |  |  |  |  |
U.S. Government and agency obligations | $ | 307 |  |  | $ | — |  |  | $ | (5) |  |  | $ | 302 |  |  | $ | — |
Municipal bonds | 466,032 |  |  | 687 |  |  | (53,563) |  |  | 412,999 |  |  | (157) |
Corporate bonds | 2,781 |  |  | — |  |  | (20) |  |  | 2,586 |  |  | (175) |
Mortgage-backed or related securities | 590,267 |  |  | — |  |  | (98,640) |  |  | 491,627 |  |  | — |
| $ | 1,059,387 |  |  | $ | 687 |  |  | $ | (152,228) |  |  | $ | 907,514 |  |  | $ | (332) |
|  | December 31, 2022
|  | Amortized Cost |  | Fair Value
Trading: |  |  |  |
Corporate bonds |  | $ | 27,203 |  |  | $ | 28,694 |
|  | $ | 27,203 |  |  | $ | 28,694 |
| December 31, 2022
| Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Allowance for Credit Losses |  | Fair Value
Available-for-Sale: |  |  |  |  |  |  |  |  |
U.S. Government and agency obligations | $ | 56,344 |  |  | $ | 8 |  |  | $ | (1,244) |  |  | $ | — |  |  | $ | 55,108 |
Municipal bonds | 301,449 |  |  | 530 |  |  | (40,770) |  |  | — |  |  | 261,209 |
Corporate bonds | 133,334 |  |  | — |  |  | (11,481) |  |  | — |  |  | 121,853 |
Mortgage-backed or related securities | 2,505,172 |  |  | 885 |  |  | (366,721) |  |  | — |  |  | 2,139,336 |
Asset-backed securities | 222,478 |  |  | 40 |  |  | (10,993) |  |  | — |  |  | 211,525 |
| $ | 3,218,777 |  |  | $ | 1,463 |  |  | $ | (431,209) |  |  | $ | — |  |  | $ | 2,789,031 |
| December 31, 2022
| Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value |  | Allowance for Credit Losses
Held-to-Maturity: |  |  |  |  |  |  |  |  |
U.S. Government and agency obligations | $ | 312 |  |  | $ | — |  |  | $ | (7) |  |  | $ | 305 |  |  | $ | — |
Municipal bonds | 503,117 |  |  | 109 |  |  | (70,907) |  |  | 432,319 |  |  | (183) |
Corporate bonds | 2,961 |  |  | — |  |  | (16) |  |  | 2,945 |  |  | (196) |
Mortgage-backed or related securities | 611,577 |  |  | — |  |  | (104,966) |  |  | 506,611 |  |  | — |
| $ | 1,117,967 |  |  | $ | 109 |  |  | $ | (175,896) |  |  | $ | 942,180 |  |  | $ | (379) |
Accrued interest receivable on held-to-maturity debt securities was $4.5 million and $4.8 million as of December 31, 2023 and December 31, 2022, and was $10.8 million and $12.4 million on available-for-sale debt securities at December 31, 2023 and December 31, 2022, respectively. Accrued interest receivable on securities is reported in accrued interest receivable on the Consolidated Statements of Financial Condition and is excluded from the calculation of the allowance for credit losses. At December 31, 2023 and December 31, 2022, the gross unrealized losses and the fair value for securities available-for-sale aggregated by the length of time that individual securities have been in a continuous unrealized loss position were as follows (in thousands):
| December 31, 2023
| Less Than 12 Months |  | 12 Months or More |  | Total
| Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses
Available-for-Sale: |  |  |  |  |  |  |  |  |  |  |
U.S. Government and agency obligations | $ | — |  |  | $ | — |  |  | $ | 34,189 |  |  | $ | (740) |  |  | $ | 34,189 |  |  | $ | (740) |
Municipal bonds | 6,049 |  |  | (7) |  |  | 103,511 |  |  | (29,184) |  |  | 109,560 |  |  | (29,191) |
Corporate bonds | 15,720 |  |  | (46) |  |  | 106,852 |  |  | (12,122) |  |  | 122,572 |  |  | (12,168) |
Mortgage-backed or related securities | 71,150 |  |  | (212) |  |  | 1,712,125 |  |  | (313,963) |  |  | 1,783,275 |  |  | (314,175) |
Asset-backed securities | 115,162 |  |  | (1,212) |  |  | 85,840 |  |  | (785) |  |  | 201,002 |  |  | (1,997) |
| $ | 208,081 |  |  | $ | (1,477) |  |  | $ | 2,042,517 |  |  | $ | (356,794) |  |  | $ | 2,250,598 |  |  | $ | (358,271) |
| December 31, 2022
| Less Than 12 Months |  | 12 Months or More |  | Total
| Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses
Available-for-Sale: |  |  |  |  |  |  |  |  |  |  |
U.S. Government and agency obligations | $ | 33,407 |  |  | $ | (882) |  |  | $ | 16,732 |  |  | $ | (362) |  |  | $ | 50,139 |  |  | $ | (1,244) |
Municipal bonds | 188,920 |  |  | (25,592) |  |  | 33,907 |  |  | (15,178) |  |  | 222,827 |  |  | (40,770) |
Corporate bonds | 108,187 |  |  | (9,547) |  |  | 13,066 |  |  | (1,934) |  |  | 121,253 |  |  | (11,481) |
Mortgage-backed or related securities | 930,566 |  |  | (90,537) |  |  | 1,159,110 |  |  | (276,184) |  |  | 2,089,676 |  |  | (366,721) |
Asset-backed securities | 201,437 |  |  | (10,993) |  |  | — |  |  | — |  |  | 201,437 |  |  | (10,993) |
| $ | 1,462,517 |  |  | $ | (137,551) |  |  | $ | 1,222,815 |  |  | $ | (293,658) |  |  | $ | 2,685,332 |  |  | $ | (431,209) |
At December 31, 2023, there were 224 securities—available-for-sale with unrealized losses, compared to 298 at December 31, 2022. Management does not believe that any individual unrealized loss as of December 31, 2023 or December 31, 2022 resulted from credit loss. The decline in fair market value of these securities was generally due to changes in interest rates and changes in market-desired spreads subsequent to their purchase. There were no sales of securities—trading for the years ended December 31, 2023, 2022 or 2021. There were no securities—trading in a nonaccrual status at December 31, 2023 or December 31, 2022. Net unrealized holding losses of $3.4 million were recognized in 2023 and net unrealized holding gains of $1.7 million were recognized in 2022. All securities—trading were transferred to securities—available-for-sale during the fourth quarter of 2023. The following table presents gross gains and losses on sales and partial calls of securities available-for-sale (in thousands):
|  |  | For the Year Ended December 31,
|  |  |  |  | 2023 |  | 2022 |  | 2021
Available-for-Sale: |  |  |  |  |  |  |  |  |
Gross Gains |  |  |  |  | $ | 383 |  |  | $ | 522 |  |  | $ | 993 |
Gross Losses |  |  |  |  | (19,625) |  |  | (3,770) |  |  | (495) |
Balance, end of the period |  |  |  |  | $ | (19,242) |  |  | $ | (3,248) |  |  | $ | 498 |
There were no securities—available-for-sale in a nonaccrual status at December 31, 2023 and 2022. The Company did not sell any held-to-maturity securities and had no partial calls of securities during the years ended December 31, 2023 and December 31, 2022. The Company sold one held-to-maturity security with a resulting net gain of $3,000 and had partial calls of securities that resulted in a net loss of $65,000 for the year ended December 31, 2021. There were no securities—held-to-maturity in a nonaccrual status at December 31, 2023 and 2022. During the years ended December 31, 2023 and December 31, 2022, the Company sold no equity securities. During the year ended December 31, 2021, the Company sold a $4.8 million equity security with a resulting net gain of $46,000. The following table presents the amortized cost and estimated fair value of securities at December 31, 2023, by contractual maturity and does not reflect any required periodic payments (in thousands). Expected maturities will differ from contractual maturities because some securities may be called or prepaid with or without call or prepayment penalties.
|  |  |  |  | December 31, 2023
|  |  | Available-for-Sale |  | Held-to-Maturity
|  |  |  |  | Amortized Cost |  | Fair Value |  | Amortized Cost |  | Fair Value
Maturing within one year |  |  |  |  | $ | — |  |  | $ | — |  |  | $ | 6,685 |  |  | $ | 6,446 |
Maturing after one year through five years |  |  |  |  | 162,723 |  |  | 152,661 |  |  | 18,546 |  |  | 18,245 |
Maturing after five years through 10 years |  |  |  |  | 370,064 |  |  | 327,355 |  |  | 22,220 |  |  | 21,240 |
Maturing after 10 years |  |  |  |  | 2,197,193 |  |  | 1,893,767 |  |  | 1,011,936 |  |  | 861,583 |
|  |  |  |  | $ | 2,729,980 |  |  | $ | 2,373,783 |  |  | $ | 1,059,387 |  |  | $ | 907,514 |
The following table presents, as of December 31, 2023, investment securities which were pledged to secure borrowings, public deposits or other obligations as permitted or required by law (in thousands):
| December 31, 2023
| Carrying Value |  | Amortized Cost |  | Fair Value
Purpose or beneficiary: |  |  |  |  |
State and local governments public deposits | $ | 250,855 |  |  | $ | 263,496 |  |  | $ | 230,490 |
Federal Reserve | 115,007 |  |  | 115,007 |  |  | 98,259 |
Interest rate swap counterparties | 971 |  |  | 971 |  |  | 813 |
Repurchase transaction accounts | 266,648 |  |  | 266,648 |  |  | 220,926 |
Other | 2,335 |  |  | 2,335 |  |  | 2,156 |
Total pledged securities | $ | 635,816 |  |  | $ | 648,457 |  |  | $ | 552,644 |
The Company monitors the credit quality of held-to-maturity debt securities through the use of credit ratings which are reviewed and updated quarterly. The Company’s non-rated held-to-maturity debt securities are primarily United States government sponsored enterprise debentures carrying minimal to no credit risk. The non-rated corporate bonds primarily consist of Community Reinvestment Act related bonds secured by loan instruments from low to moderate income borrowers. The remaining non-rated held-to-maturity debt securities balance is comprised of local municipal debt from within the Company’s geographic footprint and is monitored through quarterly or annual financial review. This municipal debt is predominately essential service or unlimited general obligation backed debt. The following tables summarize the amortized cost of held-to-maturity debt securities by credit rating at December 31, 2023 and December 31, 2022 (in thousands):
| December 31, 2023
| U.S. Government and agency obligations |  | Municipal bonds |  | Corporate bonds |  | Mortgage-backed or related securities |  | Total
AAA/AA/A | $ | — |  |  | $ | 456,999 |  |  | $ | 500 |  |  | $ | 16,459 |  |  | $ | 473,958 |
Not Rated | 307 |  |  | 9,033 |  |  | 2,281 |  |  | 573,808 |  |  | 585,429 |
| $ | 307 |  |  | $ | 466,032 |  |  | $ | 2,781 |  |  | $ | 590,267 |  |  | $ | 1,059,387 |
| December 31, 2022
| U.S. Government and agency obligations |  | Municipal bonds |  | Corporate bonds |  | Mortgage-backed or related securities |  | Total
AAA/AA/A | $ | — |  |  | $ | 492,105 |  |  | $ | 500 |  |  | $ | 16,681 |  |  | $ | 509,286 |
Not Rated | 312 |  |  | 11,012 |  |  | 2,461 |  |  | 594,896 |  |  | 608,681 |
| $ | 312 |  |  | $ | 503,117 |  |  | $ | 2,961 |  |  | $ | 611,577 |  |  | $ | 1,117,967 |
The following tables present the activity in the allowance for credit losses for held-to-maturity debt securities by major type for the year ended December 31, 2023 and December 31, 2022 (in thousands):
| For the Year Ended December 31, 2023
| U.S. Government and agency obligations |  | Municipal bonds |  | Corporate bonds |  | Mortgage-backed or related securities |  | Total
Allowance for credit losses – securities |  |  |  |  |  |  |  |  |
Beginning balance | $ | — |  |  | $ | 183 |  |  | $ | 196 |  |  | $ | — |  |  | $ | 379 |
Recapture of provision for credit losses | — |  |  | (26) |  |  | (45) |  |  | — |  |  | (71) |
Recoveries | — |  |  | — |  |  | 24 |  |  | — |  |  | 24 |
Ending balance | $ | — |  |  | $ | 157 |  |  | $ | 175 |  |  | $ | — |  |  | $ | 332 |
| For the Year Ended December 31, 2022
| U.S. Government and agency obligations |  | Municipal bonds |  | Corporate bonds |  | Mortgage-backed or related securities |  | Total
Allowance for credit losses – securities |  |  |  |  |  |  |  |  |
Beginning balance | $ | — |  |  | $ | 203 |  |  | $ | 230 |  |  | $ | — |  |  | $ | 433 |
Recapture of provision for credit losses | — |  |  | (20) |  |  | (63) |  |  | — |  |  | (83) |
Recoveries | — |  |  | — |  |  | 29 |  |  | — |  |  | 29 |
Ending balance | $ | — |  |  | $ | 183 |  |  | $ | 196 |  |  | $ | — |  |  | $ | 379 |
| For the Year Ended December 31, 2021
| U.S. Government and agency obligations |  | Municipal bonds |  | Corporate bonds |  | Mortgage-backed or related securities |  | Total
Allowance for credit losses – securities |  |  |  |  |  |  |  |  |
Beginning balance | $ | — |  |  | $ | 59 |  |  | $ | 35 |  |  | $ | — |  |  | $ | 94 |
Provision for credit losses | — |  |  | 144 |  |  | 445 |  |  | — |  |  | 589 |
Securities charged-off | — |  |  | — |  |  | (250) |  |  | — |  |  | (250) |
Ending balance | $ | — |  |  | $ | 203 |  |  | $ | 230 |  |  | $ | — |  |  | $ | 433 |

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