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INVESTMENT SECURITIES (Tables)

6 Months Ended

Jun. 30, 2024

Investments, Debt and Equity Securities [Abstract]

Summary of Amortized Cost and Approximate Fair Value of Investment Securities and Held-to-Maturity Securities

The amortized cost, approximate fair value and allowance for credit losses of investment securities at fair value as of June 30, 2024 and December 31, 2023 are summarized as follows:

			June 30, 2024 (1)
(amounts in thousands)			Amortized Cost						Allowance for Credit Losses						Gross Unrealized Gains						Gross Unrealized Losses						Fair Value
Available for sale debt securities:
Asset-backed securities			$	50,517					$	(367)					$	—					$	(3,038)					$	47,112
Agency-guaranteed residential mortgage-backed securities			198,732						—						943						(188)						199,487
Agency-guaranteed residential collateralized mortgage obligations			181,750						—						19						(12,257)						169,512
Agency-guaranteed commercial collateralized mortgage obligations			83,180						—						133						(1,495)						81,818
Collateralized loan obligations			412,452						—						—						(6,419)						406,033
Commercial mortgage-backed securities			100,610						—						—						(1,588)						99,022
Corporate notes			655,759						(4,972)						131						(63,173)						587,745
Private label collateralized mortgage obligations			939,526						—						491						(52,988)						887,029
Available for sale debt securities			$	2,622,526					$	(5,339)					$	1,717					$	(141,146)					2,477,758
Equity securities (2)																											33,892
Total investment securities, at fair value																											$	2,511,650

			December 31, 2023 (1)
(amounts in thousands)			Amortized Cost						Allowance for Credit Losses						Gross Unrealized Gains						Gross Unrealized Losses						Fair Value
Available for sale debt securities:
Asset-backed securities			$	97,359					$	(483)					$	15					$	(4,262)					$	92,629
Agency-guaranteed residential collateralized mortgage obligations			129,589						—						—						(12,681)						116,908
Collateralized loan obligations			500,109						—						1						(11,018)						489,092
Commercial mortgage-backed securities			125,885						—						—						(4,249)						121,636
Corporate notes			636,880						(3,469)						79						(50,456)						583,034
Private label collateralized mortgage obligations			1,034,841						—						1,201						(62,481)						973,561
Available for sale debt securities			$	2,524,663					$	(3,952)					$	1,296					$	(145,147)					2,376,860
Equity securities (2)																											28,780
Total investment securities, at fair value																											$	2,405,640

(1)Accrued interest on AFS debt securities totaled $18.5 million and $14.7 million at June 30, 2024 and December 31, 2023, respectively, and is included in accrued interest receivable on the consolidated balance sheet.

(2)Includes perpetual preferred stock issued by domestic banks and domestic bank holding companies and equity securities issued by fintech companies, without a readily determinable fair value, and CRA-qualified mutual fund shares at June 30, 2024 and December 31, 2023. No impairments or measurement adjustments have been recorded on the equity securities without a readily determinable fair value since acquisition.

The amortized cost, approximate fair value and allowance for credit losses of investment securities held to maturity as of June 30, 2024 and December 31, 2023 are summarized as follows:

			June 30, 2024 (1)
(amounts in thousands)			Amortized Cost						Allowance for Credit Losses						Net Carrying Value						Gross Unrealized Gains						Gross Unrealized Losses						Fair Value
Held to maturity debt securities:
Asset-backed securities			$	446,070					$	—					$	446,070					$	1,148					$	(1,515)					$	445,703
Agency-guaranteed residential mortgage-backed securities			6,960						—						6,960						—						(849)						6,111
Agency-guaranteed commercial mortgage-backed securities			1,810						—						1,810						—						(317)						1,493
Agency-guaranteed residential collateralized mortgage obligations			178,761						—						178,761						—						(18,037)						160,724
Agency-guaranteed commercial collateralized mortgage obligations			145,173						—						145,173						—						(21,899)						123,274
Private label collateralized mortgage obligations			184,025						—						184,025						—						(13,255)						170,770
Total held to maturity debt securities			$	962,799					$	—					$	962,799					$	1,148					$	(55,872)					$	908,075

			December 31, 2023 (1)
(amounts in thousands)			Amortized Cost						Allowance for Credit Losses						Net Carrying Value						Gross Unrealized Gains						Gross Unrealized Losses						Fair Value
Held to maturity debt securities:
Asset-backed securities			$	575,990					$	—					$	575,990					$	202					$	(2,064)					$	574,128
Agency-guaranteed residential mortgage-backed securities			7,039						—						7,039						—						(649)						6,390
Agency-guaranteed commercial mortgage-backed securities			1,850						—						1,850						—						(134)						1,716
Agency-guaranteed residential collateralized mortgage obligations			186,636						—						186,636						—						(19,049)						167,587
Agency-guaranteed commercial collateralized mortgage obligations			146,765						—						146,765						—						(23,178)						123,587
Private label collateralized mortgage obligations			184,890						—						184,890						—						(11,859)						173,031
Total held to maturity debt securities			$	1,103,170					$	—					$	1,103,170					$	202					$	(56,933)					$	1,046,439

(1)Accrued interest on HTM debt securities totaled $2.2 million and $2.7 million at June 30, 2024 and December 31, 2023, respectively, and is included in accrued interest receivable on the consolidated balance sheet.

Gain (Loss) on Securities

The following table presents gross realized gains and realized losses from the sale of AFS debt securities for the three and six months ended June 30, 2024 and 2023:

			Three Months Ended June 30,												Six Months Ended June 30,
(amounts in thousands)			2024						2023						2024						2023
Gross realized gains			$	176					$	—					$	176					$	—
Gross realized losses			(895)						—						(925)						—
Net realized gains (losses) on sale of available for sale debt securities			$	(719)					$	—					$	(749)					$	—

Summary of Available-for-Sale and Held-to-Maturity Debt Securities by Stated Maturity

The following table presents AFS debt securities by stated maturity. Debt securities backed by mortgages and other assets have expected maturities that differ from contractual maturities because borrowers have the right to call or prepay and, therefore, these debt securities are classified separately with no specific maturity date:

			June 30, 2024
(amounts in thousands)			Amortized Cost						Fair Value
Due in one year or less			$	35,523					$	26,273
Due after one year through five years			532,571						482,410
Due after five years through ten years			87,665						79,062
Asset-backed securities			50,517						47,112
Agency-guaranteed residential mortgage-backed securities			198,732						199,487
Agency-guaranteed residential collateralized mortgage obligations			181,750						169,512
Agency-guaranteed commercial collateralized mortgage obligations			83,180						81,818
Collateralized loan obligations			412,452						406,033
Commercial mortgage-backed securities			100,610						99,022
Private label collateralized mortgage obligations			939,526						887,029
Total available for sale debt securities			$	2,622,526					$	2,477,758

The following table presents HTM debt securities by stated maturity, including debt securities backed by mortgages and other assets with expected maturities that differ from contractual maturities because borrowers have the right to call or prepay and, therefore, are classified separately with no specific maturity date:

			June 30, 2024
(amounts in thousands)			Amortized Cost						Fair Value
Asset-backed securities			$	446,070					$	445,703
Agency-guaranteed residential mortgage-backed securities			6,960						6,111
Agency-guaranteed commercial mortgage-backed securities			1,810						1,493
Agency-guaranteed residential collateralized mortgage obligations			178,761						160,724
Agency-guaranteed commercial collateralized mortgage obligations			145,173						123,274
Private label collateralized mortgage obligations			184,025						170,770
Total held to maturity debt securities			$	962,799					$	908,075

Debt Securities, Available-for-Sale, Unrealized Loss Position, Fair Value

Gross unrealized losses and fair value of Customers’ AFS debt securities for which an allowance for credit losses has not been recorded, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at June 30, 2024 and December 31, 2023 were as follows:

			June 30, 2024
			Less Than 12 Months												12 Months or More												Total
(amounts in thousands)			Fair Value						Unrealized Losses						Fair Value						Unrealized Losses						Fair Value						Unrealized Losses
Available for sale debt securities:
Asset-backed securities			$	—					$	—					$	42,665					$	(2,771)					$	42,665					$	(2,771)
Agency-guaranteed residential mortgage-backed securities			58,493						(188)						—						—						58,493						(188)
Agency-guaranteed residential collateralized mortgage obligations			—						—						109,465						(12,257)						109,465						(12,257)
Agency-guaranteed commercial collateralized mortgage obligations			64,227						(1,495)						—						—						64,227						(1,495)
Collateralized loan obligations			57,745						(454)						278,681						(5,965)						336,426						(6,419)
Commercial mortgage-backed securities			—						—						99,022						(1,588)						99,022						(1,588)
Corporate notes			65,085						(1,610)						311,986						(33,972)						377,071						(35,582)
Private label collateralized mortgage obligations			233,432						(6,794)						572,488						(46,204)						805,920						(52,998)
Total			$	478,982					$	(10,541)					$	1,414,307					$	(102,757)					$	1,893,289					$	(113,298)

			December 31, 2023
			Less Than 12 Months												12 Months or More												Total
(amounts in thousands)			Fair Value						Unrealized Losses						Fair Value						Unrealized Losses						Fair Value						Unrealized Losses
Available for sale debt securities:
Asset-backed securities			$	—					$	—					$	64,029					$	(4,027)					$	64,029					$	(4,027)
Agency-guaranteed residential collateralized mortgage obligations			—						—						116,908						(12,681)						116,908						(12,681)
Collateralized loan obligations			29,241						(392)						438,551						(10,626)						467,792						(11,018)
Commercial mortgage-backed securities			—						—						121,636						(4,249)						121,636						(4,249)
Corporate notes			23,243						(1,147)						424,768						(33,764)						448,011						(34,911)
Private label collateralized mortgage obligations			303,750						(11,243)						613,007						(51,417)						916,757						(62,660)
Total			$	356,234					$	(12,782)					$	1,778,899					$	(116,764)					$	2,135,133					$	(129,546)

Debt Securities, Available-for-Sale, Allowance for Credit Loss

The following table presents the activity in the allowance for credit losses on AFS debt securities, by major security type, for the periods presented:

			Three Months Ended June 30,
			2024																		2023
(amounts in thousands)			Asset-backed securities						Corporate notes						Total						Asset-backed securities						Corporate notes						Total
Balance at April 1			$	450					$	4,619					$	5,069					$	790					$	1,383					$	2,173
Credit losses on securities for which credit losses were not previously recorded			—						466						466						—						233						233
Credit losses on previously impaired securities			—						242						242						773						260						1,033
Decrease in allowance for credit losses on previously impaired securities			(83)						(355)						(438)						—						—						—
Balance at June 30			$	367					$	4,972					$	5,339					$	1,563					$	1,876					$	3,439

			Six Months Ended June 30,
			2024																		2023
(amounts in thousands)			Asset-backed securities						Corporate notes						Total						Asset-backed securities						Corporate notes						Total
Balance at January 1			$	483					$	3,469					$	3,952					$	578					$	—					$	578
Credit losses on securities for which credit losses were not previously recorded			—						631						631						—						1,876						1,876
Credit losses on previously impaired securities			—						1,057						1,057						1,046						—						1,046
Decrease in allowance for credit losses on previously impaired securities			(116)						(185)						(301)						(61)						—						(61)
Balance at June 30			$	367					$	4,972					$	5,339					$	1,563					$	1,876					$	3,439

Debt Securities, Held-to-Maturity, Credit Quality Indicator

The following table presents the amortized cost of HTM debt securities based on their lowest credit rating available:

			June 30, 2024
(amounts in thousands)			AAA						AA																																																Not Rated						Total
Held to maturity debt securities:
Asset-backed securities			$	—					$	—																																															$	446,070					$	446,070
Agency-guaranteed residential mortgage-backed securities			—						—																																																6,960						6,960
Agency-guaranteed commercial mortgage-backed securities			—						—																																																1,810						1,810
Agency-guaranteed residential collateralized mortgage obligations			—						—																																																178,761						178,761
Agency-guaranteed commercial collateralized mortgage obligations			—						—																																																145,173						145,173
Private label collateralized mortgage obligations			83,903						26,124																																																73,998						184,025
Total held to maturity debt securities			$	83,903					$	26,124																																															$	852,772					$	962,799

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