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Investments

9 Months Ended

Sep. 30, 2021

Investments, Debt and Equity Securities [Abstract]

Investments

INVESTMENTS

The following tables present the amortized cost, gross unrealized gains and losses, allowance for credit losses and fair value of securities available for sale and held to maturity:

			September 30, 2021
(in thousands)			Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses												Fair Value
Available-for-sale securities:
Obligations of U.S. Government-sponsored enterprises			$	115,567					$	35					$	(665)											$	114,937
Obligations of states and political subdivisions			516,659						3,641						(4,884)												515,416
Agency mortgage-backed securities			496,330						12,166						(2,730)												505,766
U.S. Treasury bills			70,987						308						(3)												71,292
Corporate debt securities			11,750						653						—												12,403
Total securities available for sale			$	1,211,293					$	16,803					$	(8,282)											$	1,219,814
Held-to-maturity securities:
Obligations of states and political subdivisions			$	238,031					$	1,302					$	(1,634)											$	237,699
Agency mortgage-backed securities			74,972						1,303						(318)												75,957
Corporate debt securities			126,109						4,860						—												130,969
Total securities held-to-maturity			$	439,112					$	7,465					$	(1,952)											$	444,625
Allowance for credit losses			(640)
Total securities held-to-maturity, net			$	438,472

			December 31, 2020
(in thousands)			Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses						Fair Value
Available-for-sale securities:
Obligations of U.S. Government-sponsored enterprises			$	14,978					$	186					$	(3)					$	15,161
Obligations of states and political subdivisions			335,271						8,994						(33)						344,232
Agency mortgage-backed securities			506,703						20,190						(321)						526,572
U.S. Treasury Bills			10,980						486						—						11,466
Corporate debt securities			14,750						248						—						14,998
Total securities available for sale			$	882,682					$	30,104					$	(357)					$	912,429
Held-to-maturity securities:
Obligations of states and political subdivisions			$	248,324					$	2,814					$	—					$	251,138
Agency mortgage-backed securities			112,742						2,295						(496)						114,541
Corporate debt securities			126,993						8,851						—						135,844
Total securities held to maturity			$	488,059					$	13,960					$	(496)					$	501,523
Allowance for credit losses			(449)
Total securities held-to-maturity, net			$	487,610

At September 30, 2021 and December 31, 2020, there were no holdings of securities of any one issuer in an amount greater than 10% of shareholders’ equity, other than U.S. Government agencies and sponsored enterprises. The agency mortgage-backed securities are all issued by U.S. Government agencies and sponsored enterprises. Securities having a fair value of $582.3 million and $525.8 million at September 30, 2021 and December 31, 2020, respectively, were pledged as collateral to secure deposits of public institutions and for other purposes as required by law or contract provisions.

The amortized cost and estimated fair value of debt securities at September 30, 2021, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. The weighted average life of the mortgage-backed securities is approximately 4 years.

			Available for sale												Held to maturity
(in thousands)			Amortized Cost						Estimated Fair Value						Amortized Cost						Estimated Fair Value
Due in one year or less			$	71,157					$	71,191					$	209					$	214
Due after one year through five years			93,074						93,129						12,942						13,250
Due after five years through ten years			53,898						54,375						142,672						147,389
Due after ten years			496,834						495,353						208,317						207,815
Agency mortgage-backed securities			496,330						505,766						74,972						75,957
			$	1,211,293					$	1,219,814					$	439,112					$	444,625

The following tables presents a summary of available-for-sale investment securities in an unrealized loss position:

			September 30, 2021
			Less than 12 months												12 months or more												Total
(in thousands)			Fair Value						Unrealized Losses						Fair Value						Unrealized Losses						Fair Value						Unrealized Losses
Obligations of U.S. Government-sponsored enterprises			$	102,905					$	665					$	—					$	—					$	102,905					$	665
Obligations of states and political subdivisions			323,227						4,871						557						13						323,784						4,884
Agency mortgage-backed securities			205,761						2,710						1,647						20						207,408						2,730
U.S. Treasury bills			59,983						3						—						—						59,983						3
			$	691,876					$	8,249					$	2,204					$	33					$	694,080					$	8,282
			December 31, 2020
			Less than 12 months												12 months or more												Total
(in thousands)			Fair Value						Unrealized Losses						Fair Value						Unrealized Losses						Fair Value						Unrealized Losses
Obligations of U.S. Government-sponsored enterprises			$	4,997					$	3					$	—					$	—					$	4,997					$	3
Obligations of states and political subdivisions			4,079						33						—						—						4,079						33
Agency mortgage-backed securities			65,986						321						—						—						65,986						321
			$	75,062					$	357					$	—					$	—					$	75,062					$	357

The unrealized losses at both September 30, 2021 and December 31, 2020 were primarily attributable to changes in market interest rates after the securities were purchased. At September 30, 2021 and December 31, 2020, the Company had not recorded an ACL on available-for-sale securities.

Accrued interest receivable on held-to-maturity debt securities totaled $3.5 million and $3.6 million at September 30, 2021 and December 31 2020, respectively, and is excluded from the estimate of expected credit losses. The estimate of expected credit losses considers historical credit loss information adjusted for current conditions and reasonable and supportable forecasts. During the three months ended September 30, 2021, the Company recorded a provision for credit losses on held-to-maturity securities of $0.2 million. At September 30, 2021, the ACL on held-to-maturity securities was $0.6 million compared to $0.4 million at December 31, 2020.

During the three and nine months ended September 30, 2021, the Company received proceeds of $27.1 million from the sale of available-for-sale investment securities. Proceeds from sales of available-for-sale investment securities during the three and nine months ended September 30, 2020 totaled $20.0 million and $20.2 million, respectively.

Other Investments

At September 30, 2021 and December 31, 2020, other investments totaled $59.2 million and $48.8 million, respectively. As a member of the FHLB system administered by the Federal Housing Finance Agency, the Bank is required to maintain a minimum investment in capital stock with the FHLB consisting of membership stock and activity-based stock. The FHLB capital stock of $12.1 million and $10.8 million at September 30, 2021 and December 31, 2020, respectively, is recorded at cost, which represents redemption value, and is included in other investments in the consolidated balance sheets. The remaining amounts in other investments primarily include investments in SBICs, CDFIs, private equity investments, and the Company’s investment in unconsolidated trusts used to issue preferred securities to third parties.

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- Definition

The entire disclosure for investments in certain debt and equity securities.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 320
-URI http://asc.fasb.org/subtopic&trid=2209399

Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 946
-SubTopic 320
-URI http://asc.fasb.org/subtopic&trid=2324412

Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 320
-URI http://asc.fasb.org/topic&trid=2196928

Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 940
-SubTopic 320
-URI http://asc.fasb.org/subtopic&trid=2176304

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