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Securities (Tables)

9 Months Ended

Sep. 30, 2023

Investments, Debt and Equity Securities [Abstract]

Schedule of Gross Realized and Unrealized Losses Recognized on Equity Securities

The gross realized and unrealized gains and losses recognized on equity securities with readily determinable fair values in noninterest income in the Company’s consolidated statements of income were as follows:

						Three Months Ended September 30,												Nine Months Ended September 30,
(Dollars in thousands)						2023						2022						2023						2022
Unrealized gains (losses) on equity securities held at the reporting date						$	(137)					$	(134)					$	(137)					$	(588)
Realized gains (losses) on equity securities sold during the period						—						—						18						—
						$	(137)					$	(134)					$	(119)					$	(588)

The gross realized and unrealized gains (losses) recognized on equity securities without readily determinable fair values in noninterest income in the Company’s consolidated statements of income were as follows:

			Three Months Ended September 30,												Nine Months Ended September 30,
(Dollars in thousands)			2023						2022						2023						2022
Unrealized gains (losses) on equity securities still held at the reporting date			$	—					$	—					$	—					$	10,163
Realized gains (losses) on equity securities sold during the period			—						—						—						—
			$	—					$	—					$	—					$	10,163

Equity Securities without Readily Determinable Fair Value

The following table summarizes the Company's investments in equity securities without readily determinable fair values:

(Dollars in thousands)			September 30, 2023						December 31, 2022
Equity Securities without readily determinable fair value, at cost			$	55,812					$	39,019
Upward adjustments based on observable price changes, cumulative			10,163						10,163
Equity Securities without readily determinable fair value, carrying value			$	65,975					$	49,182

Schedule of Amortized Cost of Securities and Their Estimated Fair Values

The following table summarizes the amortized cost, fair value, and allowance for credit losses of debt securities and the corresponding amounts of gross unrealized gains and losses of available for sale securities recognized in accumulated other comprehensive income (loss) and gross unrecognized gains and losses of held to maturity securities:

(Dollars in thousands)						Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses						Allowance for Credit Losses						Fair Value
September 30, 2023
Available for sale securities:
Mortgage-backed securities, residential						$	49,346					$	9					$	(6,173)					$	—					$	43,182
Asset-backed securities						1,243						10						—						—						1,253
State and municipal						5,217						—						(189)						—						5,028
CLO securities						240,162						1,047						(734)						—						240,475
Corporate bonds						768						—						(19)						—						749
SBA pooled securities						1,746						7						(116)						—						1,637
Total available for sale securities						$	298,482					$	1,073					$	(7,231)					$	—					$	292,324

(Dollars in thousands)						Amortized Cost						Gross Unrealized Gains						Gross Unrecognized Losses						Fair Value
September 30, 2023
Held to maturity securities:
CLO securities						$	6,201					$	339					$	(1,784)					$	4,756
Allowance for credit losses						(2,890)
Total held to maturity securities, net of ACL						$	3,311

(Dollars in thousands)						Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses						Allowance for Credit Losses						Fair Value
December 31, 2022
Available for sale securities:
Mortgage-backed securities, residential						$	55,329					$	235					$	(4,931)					$	—					$	50,633
Asset-backed securities						6,389						—						(58)						—						6,331
State and municipal						13,553						1						(116)						—						13,438
CLO Securities						185,068						161						(4,218)						—						181,011
Corporate bonds						1,270						1						(8)						—						1,263
SBA pooled securities						1,910						29						(111)						—						1,828
Total available for sale securities						$	263,519					$	427					$	(9,442)					$	—					$	254,504

(Dollars in thousands)						Amortized Cost						Gross Unrealized Gains						Gross Unrecognized Losses						Fair Value
December 31, 2022
Held to maturity securities:
CLO securities						$	6,521					$	458					$	(1,503)					$	5,476
Allowance for credit losses						(2,444)
Total held to maturity securities, net of ACL						$	4,077

Schedule of Amortized Cost and Estimated Fair Value of Debt Securities by Contractual Maturity

The amortized cost and estimated fair value of securities at September 30, 2023, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

						Available for Sale Securities												Held to Maturity Securities
(Dollars in thousands)						Amortized Cost						Fair Value						Amortized Cost						Fair Value
Due in one year or less						$	1,167					$	1,165					$	—					$	—
Due from one year to five years						2,212						2,122						1,913						2,085
Due from five years to ten years						72,866						72,665						4,288						2,671
Due after ten years						169,902						170,300						—						—
						246,147						246,252						6,201						4,756
Mortgage-backed securities, residential						49,346						43,182						—						—
Asset-backed securities						1,243						1,253						—						—
SBA pooled securities						1,746						1,637						—						—
						$	298,482					$	292,324					$	6,201					$	4,756

Schedule of Proceeds from Sales of Debt Securities and the Associated Gross Gains and Losses as well as Net Gains and Losses from Calls of Debt Securities

Proceeds from sales of debt securities and the associated gross gains and losses as well as net gains and losses from calls of debt securities are as follows:

						Three Months Ended September 30,												Nine Months Ended September 30,
(Dollars in thousands)						2023						2022						2023						2022
Proceeds						$	10,005					$	—					$	14,005					$	40,163
Gross gains						5						—						5						2,512
Gross losses						—						—						—						—
Net gains and losses from calls of securities						—						—						—						2

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

The following table summarizes available for sale debt securities in an unrealized loss position 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 loss position:

						Less than 12 Months												12 Months or More												Total
(Dollars in thousands)						Fair Value						Unrealized Losses						Fair Value						Unrealized Losses						Fair Value						Unrealized Losses
September 30, 2023
Available for sale securities:
Mortgage-backed securities, residential						$	1,429					$	(100)					$	35,045					$	(6,073)					$	36,474					$	(6,173)
Asset-backed securities						—						—						—						—						—						—
State and municipal						1,537						(64)						2,986						(125)						4,523						(189)
CLO securities						14,966						(34)						78,211						(700)						93,177						(734)
Corporate bonds						749						(19)						—						—						749						(19)
SBA pooled securities						220						(6)						1,111						(110)						1,331						(116)
						$	18,901					$	(223)					$	117,353					$	(7,008)					$	136,254					$	(7,231)

						Less than 12 Months												12 Months or More												Total
(Dollars in thousands)						Fair Value						Unrealized Losses						Fair Value						Unrealized Losses						Fair Value						Unrealized Losses
December 31, 2022
Available for sale securities:
Mortgage-backed securities, residential						$	26,030					$	(1,507)					$	15,828					$	(3,424)					$	41,858					$	(4,931)
Asset-backed securities						1,337						(52)						4,994						(6)						6,331						(58)
State and municipal						12,680						(116)						—						—						12,680						(116)
CLO Securities						151,572						(3,407)						19,439						(811)						171,011						(4,218)
Corporate bonds						261						(8)						—						—						261						(8)
SBA pooled securities						1,262						(111)						—						—						1,262						(111)
						$	193,142					$	(5,201)					$	40,261					$	(4,241)					$	233,403					$	(9,442)

Summary of Activity in Allowance for Credit Losses for Held To Maturity Debt Securities

The following table presents the activity in the allowance for credit losses for held to maturity debt securities:

(Dollars in thousands)						Three Months Ended September 30,												Nine Months Ended September 30,
Held to Maturity CLO Securities						2023						2022						2023						2022
Allowance for credit losses:
Beginning balance						$	2,876					$	2,355					$	2,444					$	2,082
Credit loss expense						14						75						446						348
Allowance for credit losses ending balance						$	2,890					$	2,430					$	2,890					$	2,430

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