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Securities (Tables)

9 Months Ended

Sep. 30, 2020

Investments, Debt and Equity Securities [Abstract]

Schedule of Debt Securities, Available-for-sale

The amortized cost, estimated fair value, and allowance for credit losses of debt securities available-for-sale and held-to-maturity at September 30, 2020, and December 31, 2019, are as follows (in thousands):

			Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses						Estimated Fair Value						Allowance for Credit Losses
At September 30, 2020
Debt securities available-for-sale:
Investment securities:
U.S. government and agency obligations			$	158,778					$	3,653					$	(3)					$	162,428					$	—
State and municipal obligations			2,402						—						—						2,402						—
Corporate debt securities			4,500						61						—						4,561						—
Total investment securities			165,680						3,714						(3)						169,391						—
Mortgage-backed securities - FNMA			240						3						—						243						—
Total debt securities available-for-sale			$	165,920					$	3,717					$	(3)					$	169,634					$	—
Debt securities held-to-maturity:
Investment securities:
U.S. government and agency obligations			$	4,997					$	14					$	—					$	5,011					$	—
State and municipal obligations			214,865						9,375						(225)						224,015						(33)
Corporate debt securities			72,289						1,700						(3,867)						70,122						(1,579)
Total investment securities			292,151						11,089						(4,092)						299,148						(1,612)
Mortgage-backed securities:
FHLMC			202,329						6,093						(135)						208,287						—
FNMA			245,524						7,799						(141)						253,182						—
GNMA			82,230						2,457						(16)						84,671						—
SBA			5,634						—						(60)						5,574						—
CMO			49,745						1,811						—						51,556						(781)
Total mortgage-backed securities			585,462						18,160						(352)						603,270						(781)
Total debt securities held-to-maturity			$	877,613					$	29,249					$	(4,444)					$	902,418					$	(2,393)
Total debt securities			$	1,043,533					$	32,966					$	(4,447)					$	1,072,052					$	(2,393)

			Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses						Estimated Fair Value
At December 31, 2019
Debt securities available-for-sale:
Investment securities:
U.S. government and agency obligations			$	149,120					$	1,408					$	(93)					$	150,435
State and municipal obligations			25						—						—						25
Total investment securities			149,145						1,408						(93)						150,460
Mortgage-backed securities - FNMA			495						5						—						500
Total debt securities available-for-sale			$	149,640					$	1,413					$	(93)					$	150,960
Debt securities held-to-maturity:
Investment securities:
U.S. government and agency obligations			$	4,984					$	14					$	—					$	4,998
State and municipal obligations			124,430						1,537						(208)						125,759
Corporate debt securities			79,547						833						(2,421)						77,959
Total investment securities			208,961						2,384						(2,629)						208,716
Mortgage-backed securities:
FHLMC			206,985						2,221						(524)						208,682
FNMA			244,428						2,680						(493)						246,615
GNMA			110,661						939						(212)						111,388
SBA			1,940						—						(51)						1,889
Total mortgage-backed securities			564,014						5,840						(1,280)						568,574
Total debt securities held-to-maturity			$	772,975					$	8,224					$	(3,909)					$	777,290
Total debt securities			$	922,615					$	9,637					$	(4,002)					$	928,250

Schedule of Carrying Value of Held-to-Maturity Investment Securities

The amortized cost, estimated fair value, and allowance for credit losses of debt securities available-for-sale and held-to-maturity at September 30, 2020, and December 31, 2019, are as follows (in thousands):

			Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses						Estimated Fair Value						Allowance for Credit Losses
At September 30, 2020
Debt securities available-for-sale:
Investment securities:
U.S. government and agency obligations			$	158,778					$	3,653					$	(3)					$	162,428					$	—
State and municipal obligations			2,402						—						—						2,402						—
Corporate debt securities			4,500						61						—						4,561						—
Total investment securities			165,680						3,714						(3)						169,391						—
Mortgage-backed securities - FNMA			240						3						—						243						—
Total debt securities available-for-sale			$	165,920					$	3,717					$	(3)					$	169,634					$	—
Debt securities held-to-maturity:
Investment securities:
U.S. government and agency obligations			$	4,997					$	14					$	—					$	5,011					$	—
State and municipal obligations			214,865						9,375						(225)						224,015						(33)
Corporate debt securities			72,289						1,700						(3,867)						70,122						(1,579)
Total investment securities			292,151						11,089						(4,092)						299,148						(1,612)
Mortgage-backed securities:
FHLMC			202,329						6,093						(135)						208,287						—
FNMA			245,524						7,799						(141)						253,182						—
GNMA			82,230						2,457						(16)						84,671						—
SBA			5,634						—						(60)						5,574						—
CMO			49,745						1,811						—						51,556						(781)
Total mortgage-backed securities			585,462						18,160						(352)						603,270						(781)
Total debt securities held-to-maturity			$	877,613					$	29,249					$	(4,444)					$	902,418					$	(2,393)
Total debt securities			$	1,043,533					$	32,966					$	(4,447)					$	1,072,052					$	(2,393)

			Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses						Estimated Fair Value
At December 31, 2019
Debt securities available-for-sale:
Investment securities:
U.S. government and agency obligations			$	149,120					$	1,408					$	(93)					$	150,435
State and municipal obligations			25						—						—						25
Total investment securities			149,145						1,408						(93)						150,460
Mortgage-backed securities - FNMA			495						5						—						500
Total debt securities available-for-sale			$	149,640					$	1,413					$	(93)					$	150,960
Debt securities held-to-maturity:
Investment securities:
U.S. government and agency obligations			$	4,984					$	14					$	—					$	4,998
State and municipal obligations			124,430						1,537						(208)						125,759
Corporate debt securities			79,547						833						(2,421)						77,959
Total investment securities			208,961						2,384						(2,629)						208,716
Mortgage-backed securities:
FHLMC			206,985						2,221						(524)						208,682
FNMA			244,428						2,680						(493)						246,615
GNMA			110,661						939						(212)						111,388
SBA			1,940						—						(51)						1,889
Total mortgage-backed securities			564,014						5,840						(1,280)						568,574
Total debt securities held-to-maturity			$	772,975					$	8,224					$	(3,909)					$	777,290
Total debt securities			$	922,615					$	9,637					$	(4,002)					$	928,250

The carrying value of the debt securities held-to-maturity at September 30, 2020, and December 31, 2019, is as follows (in thousands):

			September 30, 2020						December 31, 2019
Amortized cost			$	877,613					$	772,975
Net loss on date of transfer from available-for-sale			(13,347)						(13,347)
Allowance for credit loss			(2,393)						—
Accretion of net unrealized loss on securities reclassified as held-to-maturity			9,815						9,245
Carrying value			$	871,688					$	768,873

Schedule of Debt Securities, Held-to-maturity, Allowance for Credit Loss

The following table presents the activity in the allowance for credit losses for debt securities held-to-maturity by major security type for the nine months ended September 30, 2020 (in thousands):

			Investment securities						Mortgage-backed securities
Allowance for credit losses
Beginning balance			$	—					$	—
Impact of CECL adoption			(1,268)						—
Provision for credit loss expense			(344)						(781)
Total ending allowance balance			$	(1,612)					$	(781)

Schedule of Debt Securities, Trading, and Equity Securities, FV-NI

The realized and unrealized gains or losses on equity securities for the three and nine months ended September 30, 2020 and September 30, 2019 are shown in the table below (in thousands).

			Three Months Ended September 30,												Nine Months Ended September 30,
			2020						2019						2020						2019
Net (loss) gain on equity investments			$	(3,576)					$	89					$	(3,273)					$	330
Less: Net losses recognized on equity securities sold			—						—						(53)						—
Unrealized (loss) gain recognized on equity securities still held			$	(3,576)					$	89					$	(3,220)					$	330

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

The amortized cost and estimated fair value of investment securities at September 30, 2020 by contractual maturity are shown below (in thousands). Actual maturities may differ from contractual maturities in instances where issuers have the right to call or prepay obligations with or without call or prepayment penalties. At September 30, 2020, corporate debt securities with an amortized cost of $38.5 million and estimated fair value of $39.8 million were callable prior to the maturity date.

September 30, 2020			Amortized Cost						Estimated Fair Value
Less than one year			$	95,990					$	96,765
Due after one year through five years			180,827						186,965
Due after five years through ten years			78,064						75,630
Due after ten years			102,950						109,180
			$	457,831					$	468,540

Summary of Estimated Fair Value and Unrealized Loss for Securities Available-for-Sale and Held-to-Maturity

The estimated fair value and unrealized losses of debt securities available-for-sale and held-to-maturity at September 30, 2020 and December 31, 2019, segregated by the duration of the unrealized losses, are as follows (in thousands):

			At September 30, 2020
			Less than 12 months												12 months or longer												Total
			Estimated Fair Value						Unrealized Losses						Estimated Fair Value						Unrealized Losses						Estimated Fair Value						Unrealized Losses
Debt securities available-for-sale:
Investment securities - U.S. government and agency obligations			$	17,060					$	(3)					$	—					$	—					$	17,060					$	(3)
Total debt securities available-for-sale			17,060						(3)						—						—						17,060						(3)
Debt securities held-to-maturity:
Investment securities:
State and municipal obligations			$	3,635					$	(42)					$	7,383					$	(183)					$	11,018					$	(225)
Corporate debt securities			9,429						(434)						34,899						(3,433)						44,328						(3,867)
Total investment securities			13,064						(476)						42,282						(3,616)						55,346						(4,092)
Mortgage-backed securities:
FHLMC			31,267						(127)						965						(8)						32,232						(135)
FNMA			39,572						(127)						485						(14)						40,057						(141)
GNMA			6,008						(14)						228						(2)						6,236						(16)
SBA			3,850						(11)						1,724						(49)						5,574						(60)
CMO			—						—						—						—						—						—
Total mortgage-backed securities			80,697						(279)						3,402						(73)						84,099						(352)
Total debt securities held-to-maturity			93,761						(755)						45,684						(3,689)						139,445						(4,444)
Total debt securities			$	110,821					$	(758)					$	45,684					$	(3,689)					$	156,505					$	(4,447)
			At December 31, 2019
			Less than 12 months												12 months or longer												Total
			Estimated Fair Value						Unrealized Losses						Estimated Fair Value						Unrealized Losses						Estimated Fair Value						Unrealized Losses
Debt securities available-for-sale:
Investment securities - U.S. government and agency obligations			$	25,021					$	(54)					$	22,451					$	(39)					$	47,472					$	(93)
Total debt securities available-for-sale			25,021						(54)						22,451						(39)						47,472						(93)
Debt securities held-to-maturity:
Investment securities:
State and municipal obligations			7,308						(58)						14,531						(150)						21,839						(208)
Corporate debt securities			9,727						(213)						37,628						(2,208)						47,355						(2,421)
Total investment securities			17,035						(271)						52,159						(2,358)						69,194						(2,629)
Mortgage-backed securities:
FHLMC			6,329						(29)						38,641						(495)						44,970						(524)
FNMA			13,682						(59)						38,568						(434)						52,250						(493)
GNMA			30,268						(93)						19,828						(119)						50,096						(212)
SBA			—						—						1,889						(51)						1,889						(51)
Total mortgage-backed securities			50,279						(181)						98,926						(1,099)						149,205						(1,280)
Total debt securities held-to-maturity			67,314						(452)						151,085						(3,457)						218,399						(3,909)
Total debt securities			$	92,335					$	(506)					$	173,536					$	(3,496)					$	265,871					$	(4,002)

Schedule of Amortized Cost, Estimated Fair Value and Credit Rating of Corporate Debt Securities

At September 30, 2020, the amortized cost, estimated fair value and credit rating of the individual corporate debt securities in an unrealized loss position for greater than one year are as follows (in thousands):

Security Description			Amortized Cost						Estimated Fair Value						Credit Rating Moody’s/ S&P
Chase Capital			$	10,000					$	9,205					Baa1/BBB-
Wells Fargo Capital			5,000						4,495						A1/BBB-
Huntington Capital			5,000						4,432						Baa2/BB+
Keycorp Capital			5,000						4,513						Baa2/BB+
PNC Capital			5,000						4,577						Baa1/BBB-
SunTrust Capital			5,000						4,670						Not Rated/BBB-
State Street Capital			3,332						3,007						A3/BBB
			$	38,332					$	34,899

Schedule of Debt Securities, Held-to-maturity, Credit Quality Indicator

The following table summarized the amortized cost of debt securities held-to-maturity at September 30, 2020, aggregated by credit quality indicator (in thousands):

			AAA						AA						A						BBB						BB						Total
As of September 30, 2020
Investment securities:
U.S. government and agency obligations			$	—					$	4,997					$	—					$	—					$	—					$	4,997
State and municipal obligations			35,280						128,128						46,390						5,067						—						214,865
Corporate debt securities			—						1,495						11,960						47,502						11,332						72,289
Total investment securities			35,280						134,620						58,350						52,569						11,332						292,151
Mortgage-backed securities:
CMO			16,909						32,836						—						—						—						49,745
Total mortgage-backed securities			16,909						32,836						—						—						—						49,745
Total debt securities held-to-maturity			$	52,189					$	167,456					$	58,350					$	52,569					$	11,332					$	341,896

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