The amortized cost, approximate fair value and allowance for credit losses of investment securities at fair value as of March 31, 2025 and December 31, 2024 are summarized as follows:


	March 31, 2025 (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	$	169,570	$	(353)	$	—	$	(742)	$	168,475

Agency-guaranteed residential mortgage-backed securities	322,646		—		1,349		(1,111)		322,884

Agency-guaranteed residential collateralized mortgage obligations	236,386		—		2,037		(10,080)		228,343
Agency-guaranteed commercial collateralized mortgage obligations	95,734		—		269		(2,256)		93,747
Collateralized loan obligations	187,703		—		66		(290)		187,479
Commercial mortgage-backed securities	76,008		—		—		—		76,008
Corporate notes	518,545		(12,774)		914		(24,324)		482,361
Private label collateralized mortgage obligations	488,626		—		—		(23,486)		465,140


Available for sale debt securities	$	2,095,218	$	(13,127)	$	4,635	$	(62,289)	2,024,437

Equity securities (2)									33,118
Total investment securities, at fair value									$	2,057,555


	December 31, 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	$	14,820	$	(362)	$	—	$	(1,222)	$	13,236

Agency-guaranteed residential mortgage-backed securities	330,637		—		146		(3,745)		327,038

Agency-guaranteed residential collateralized mortgage obligations	242,858		—		—		(16,112)		226,746
Agency-guaranteed commercial collateralized mortgage obligations	95,850		—		44		(2,819)		93,075
Collateralized loan obligations	257,500		—		100		(2,193)		255,407
Commercial mortgage-backed securities	78,707		—		—		(999)		77,708
Corporate notes	564,524		(7,135)		347		(41,406)		516,330
Private label collateralized mortgage obligations	502,985		(107)		95		(27,075)		475,898

Available for sale debt securities	$	2,087,881	$	(7,604)	$	732	$	(95,571)	1,985,438

Equity securities (2)									34,256
Total investment securities, at fair value									$	2,019,694

(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 March 31, 2025 and December 31, 2024. No impairments or measurement adjustments have been recorded on the equity securities without a readily determinable fair value since acquisition.

Customers’ transactions with unconsolidated VIEs include sales of consumer installment loans and investments in the securities issued by the VIEs. Customers is not the primary beneficiary of the VIEs because Customers has no right to make decisions that will most significantly affect the economic performance of the VIEs. Customers’ continuing involvement with the unconsolidated VIEs is not significant. Customers’ continuing involvement is not considered to be significant where Customers only invests in securities issued by the VIE and was not involved in the design of the VIE or where Customers has transferred financial assets to the VIE for only cash consideration. Customers’ investments in the securities issued by the VIEs are classified as AFS or HTM debt securities on the consolidated balance sheets, and represent Customers’ maximum exposure to loss.

There was no sale of AFS debt securities for the three months ended March 31, 2025. Proceeds from the sale of AFS debt securities were $22.0 million for the three months ended March 31, 2024. The following table presents gross realized gains and realized losses from the sale of AFS debt securities for the three months ended March 31, 2025 and 2024:


	Three Months Ended March 31,
(amounts in thousands)	2025		2024
Gross realized gains	$	—	$	—
Gross realized losses	—		(30)
Net realized gains (losses) on sale of available for sale debt securities	$	—	$	(30)

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.


	March 31, 2025
(amounts in thousands)	Amortized Cost		Fair Value
Due in one year or less	$	20,195	$	19,816
Due after one year through five years	422,613		391,589
Due after five years through ten years	68,214		65,011
Due after ten years	7,523		5,945
Asset-backed securities	169,570		168,475
Agency-guaranteed residential mortgage-backed securities	322,646		322,884

Agency-guaranteed residential collateralized mortgage obligations	236,386		228,343
Agency-guaranteed commercial collateralized mortgage obligations	95,734		93,747
Collateralized loan obligations	187,703		187,479
Commercial mortgage-backed securities	76,008		76,008
Private label collateralized mortgage obligations	488,626		465,140


Total available for sale debt securities	$	2,095,218	$	2,024,437

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 March 31, 2025 and December 31, 2024 were as follows:


	March 31, 2025
	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:

Agency-guaranteed residential mortgage-backed securities	$	191,812	$	(1,111)	$	—	$	—	$	191,812	$	(1,111)

Agency-guaranteed residential collateralized mortgage obligations	—		—		99,860		(10,080)		99,860		(10,080)
Agency-guaranteed commercial collateralized mortgage obligations	59,818		(1,571)		16,881		(685)		76,699		(2,256)
Collateralized loan obligations	—		—		131,203		(290)		131,203		(290)

Corporate notes	68,532		(716)		266,678		(12,087)		335,210		(12,803)
Private label collateralized mortgage obligations	89,058		(261)		385,532		(23,225)		474,590		(23,486)


Total	$	409,220	$	(3,659)	$	900,154	$	(46,367)	$	1,309,374	$	(50,026)


	December 31, 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:

Agency-guaranteed residential mortgage-backed securities	$	266,568	$	(3,745)	$	—	$	—	$	266,568	$	(3,745)

Agency-guaranteed residential collateralized mortgage obligations	126,602		(2,717)		100,144		(13,395)		226,746		(16,112)
Agency-guaranteed commercial collateralized mortgage obligations	85,902		(2,819)		—		—		85,902		(2,819)
Collateralized loan obligations	35,710		(265)		205,639		(1,928)		241,349		(2,193)
Commercial mortgage-backed securities	—		—		77,708		(999)		77,708		(999)
Corporate notes	74,373		(976)		239,509		(16,064)		313,882		(17,040)
Private label collateralized mortgage obligations	29,419		(581)		351,040		(24,552)		380,459		(25,133)


Total	$	618,574	$	(11,103)	$	974,040	$	(56,938)	$	1,592,614	$	(68,041)

At March 31, 2025, there were 24 AFS debt securities with unrealized losses in the less-than-twelve-months category and 37 AFS debt securities with unrealized losses in the twelve-months-or-more category. Except for certain AFS debt securities where there was a change in future estimated cash flows as further discussed below, the unrealized losses were principally due to changes in market interest rates and credit spreads that resulted in a negative impact on the respective securities’ fair value and expected to be recovered when market prices recover or at maturity. Customers does not intend to sell any of the 61 securities with unrealized losses, and it is not more likely than not that Customers will be required to sell any of the 61 securities before recovery of the amortized cost basis. At December 31, 2024, there were 117 AFS debt securities in an unrealized loss position.

Customers recorded an allowance for credit losses on certain AFS debt securities where there was a change in future estimated cash flows during the three months ended March 31, 2025 and 2024. A discounted cash flow approach is used to determine the amount of the allowance. The cash flows expected to be collected, after considering expected prepayments, are discounted at the original effective interest rate. The amount of the allowance is limited to the difference between the amortized cost basis of the security and its estimated fair value.

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 March 31,
	2025								2024
(amounts in thousands)	Asset-backed securities		Corporate notes		Private label CMOs		Total		Asset-backed securities		Corporate notes		Total
Balance at January 1	$	362	$	7,135	$	107	$	7,604	$	483	$	3,469	$	3,952
Credit losses on securities for which credit losses were not previously recorded	—		—		—		—		—		502		502
Credit losses on previously impaired securities	66		7,007		—		7,073		—		648		648
Decrease in allowance for credit losses on previously impaired securities	(75)		(146)		—		(221)		(33)		—		(33)
Reduction due to sales and intent to sell	—		(1,222)		(107)		(1,329)		—		—		—
Balance at March 31	$	353	$	12,774	$	—	$	13,127	$	450	$	4,619	$	5,069

Customers has elected to not estimate an ACL on accrued interest receivable on AFS debt securities, as it already has a policy in place to reverse or write-off accrued interest, through interest income, for debt securities in nonaccrual status in a timely manner. At March 31, 2025, there were four corporate notes from two issuers in nonaccrual status. At December 31, 2024, there was one corporate note in nonaccrual status. Customers recorded a reversal of $4.1 million for the corporate notes in accrued interest income for the three months ended March 31, 2025. No accrued interest income was reversed for the three months ended March 31, 2024.

At March 31, 2025 and December 31, 2024, Customers Bank had pledged AFS investment securities aggregating $1.3 billion in fair value as collateral primarily for immediately available liquidity from the FRB. The counterparty does not have the ability to sell or repledge these securities.


	March 31, 2025 (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	$	409,904	$	—	$	409,904	$	397	$	(1,631)	$	408,670

Agency-guaranteed residential mortgage-backed securities	6,833		—		6,833		—		(822)		6,011
Agency-guaranteed commercial mortgage-backed securities	1,750		—		1,750		—		(262)		1,488
Agency-guaranteed residential collateralized mortgage obligations	165,521		—		165,521		—		(16,848)		148,673
Agency-guaranteed commercial collateralized mortgage obligations	171,307		—		171,307		—		(21,702)		149,605



Private label collateralized mortgage obligations	182,846		—		182,846		372		(11,127)		172,091

Total held to maturity debt securities	$	938,161	$	—	$	938,161	$	769	$	(52,392)	$	886,538


	December 31, 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	$	471,996	$	—	$	471,996	$	1,775	$	(401)	$	473,370

Agency-guaranteed residential mortgage-backed securities	6,880		—		6,880		—		(940)		5,940
Agency-guaranteed commercial mortgage-backed securities	1,770		—		1,770		—		(146)		1,624
Agency-guaranteed residential collateralized mortgage obligations	169,754		—		169,754		—		(21,984)		147,770
Agency-guaranteed commercial collateralized mortgage obligations	158,320		—		158,320		—		(22,689)		135,631



Private label collateralized mortgage obligations	183,217		—		183,217		574		(13,449)		170,342

Total held to maturity debt securities	$	991,937	$	—	$	991,937	$	2,349	$	(59,609)	$	934,677

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:


	March 31, 2025
(amounts in thousands)	Amortized Cost		Fair Value




Asset-backed securities	$	409,904	$	408,670


Agency-guaranteed residential mortgage-backed securities	6,833		6,011
Agency-guaranteed commercial mortgage-backed securities	1,750		1,488
Agency-guaranteed residential collateralized mortgage obligations	165,521		148,673
Agency-guaranteed commercial collateralized mortgage obligations	171,307		149,605
Private label collateralized mortgage obligations	182,846		172,091
Total held to maturity debt securities	$	938,161	$	886,538

Customers recorded no allowance for credit losses on investment securities classified as held to maturity at March 31, 2025 and December 31, 2024. The U.S. government agency securities represent obligations issued by a U.S. government-sponsored enterprise or other federal government agency that are explicitly or implicitly guaranteed by the U.S. federal government and therefore, assumed to have zero credit losses. The private label collateralized mortgage obligations that are highly rated with sufficient overcollateralization are estimated to have no expected credit losses. Customers recorded no allowance for its investments in the asset-backed securities. Customers considered the seniority of its beneficial interests, which include overcollateralization of these asset-backed securities in the estimate of the ACL at March 31, 2025 and December 31, 2024. The unrealized losses on HTM debt securities with no ACL were primarily due to changes in market interest rates that resulted in a negative impact on the respective securities’ fair value and are expected to be recovered when market prices recover or at maturity.

Customers monitors the credit quality of HTM debt securities primarily through credit ratings provided by rating agencies. Investment grade debt securities are rated BBB- or higher by S&P Global Ratings, Baa3 or higher by Moody’s Investors Service or equivalent ratings by other rating agencies, and are generally considered to be of low credit risk. Except for the asset-backed securities and a private label collateralized mortgage obligation, all of the HTM debt securities held by Customers were investment grade or U.S. government agency guaranteed securities that were not rated at March 31, 2025 and December 31, 2024. The asset-backed securities and a private label collateralized mortgage obligation are not rated by rating agencies. Customers monitors the credit quality of these asset-backed securities and a private label collateralized mortgage obligation by evaluating the performance of the sold consumer installment loans and other underlying loans against the overcollateralization available for these securities.


	March 31, 2025
(amounts in thousands)	AAA		AA		Not Rated		Total
Held to maturity debt securities:
Asset-backed securities	$	—	$	—	$	409,904	$	409,904

Agency-guaranteed residential mortgage-backed securities	—		—		6,833		6,833
Agency-guaranteed commercial mortgage-backed securities	—		—		1,750		1,750
Agency-guaranteed residential collateralized mortgage obligations	—		—		165,521		165,521
Agency-guaranteed commercial collateralized mortgage obligations	—		—		171,307		171,307



Private label collateralized mortgage obligations	82,060		26,323		74,463		182,846

Total held to maturity debt securities	$	82,060	$	26,323	$	829,778	$	938,161

Customers has elected to not estimate an ACL on accrued interest receivable on HTM debt securities, as it already has a policy in place to reverse or write-off accrued interest, through interest income, for debt securities in nonaccrual status in a timely manner. At March 31, 2025 and December 31, 2024, there were no HTM debt securities past due under the terms of their agreements or in nonaccrual status.

At March 31, 2025 and December 31, 2024, Customers Bank had pledged HTM investment securities aggregating $403.0 million and $386.4 million in fair value, respectively, as collateral primarily for immediately available liquidity from the FRB and unused lines of credit with another financial institution. The counterparties do not have the ability to sell or repledge these securities.