
	March 31, 2022
	Amortized		Gross Unrealized		Gross Unrealized		Estimated
AVAILABLE FOR SALE	Cost		Gains		Losses		Fair Value
Investment securities:


State and political subdivisions	$	1,614,421	$	10,637	$	58,873	$	1,566,185
Corporate bonds and other	144,264		253		3,191		141,326

MBS: (1)
Residential	280,804		2,581		2,694		280,691
Commercial	78,108		262		588		77,782
Total	$	2,117,597	$	13,733	$	65,346	$	2,065,984




HELD TO MATURITY
Investment securities:
State and political subdivisions	$	386,573	$	944	$	12,767	$	374,750
MBS: (1)
Residential	37,986		387		64		38,309
Commercial	49,760		62		260		49,562
Total	$	474,319	$	1,393	$	13,091	$	462,621


	December 31, 2021
	Amortized		Gross Unrealized		Gross Unrealized		Estimated
AVAILABLE FOR SALE	Cost		Gains		Losses		Fair Value
Investment securities:
U.S. Treasury	$	58,084	$	843	$	50	$	58,877

State and political subdivisions	1,962,257		93,893		4,214		2,051,936
Corporate bonds and other	133,333		2,408		209		135,532

MBS: (1)
Residential	411,727		14,895		272		426,350
Commercial	90,193		1,642		205		91,630
Total	$	2,655,594	$	113,681	$	4,950	$	2,764,325





HELD TO MATURITY
Investment securities:
State and political subdivisions	$	788	$	3	$	—	$	791
MBS: (1)
Residential	38,644		2,103		—		40,747
Commercial	51,348		2,349		—		53,697
Total	$	90,780	$	4,455	$	—	$	95,235

From time to time, we transfer securities from AFS to HTM due to overall balance sheet strategies. We transferred securities from AFS to HTM with an estimated fair value of $385.8 million during the three months ended March 31, 2022. There were no securities transferred from AFS to HTM during the year ended December 31, 2021. The remaining net unamortized, unrealized loss on the transferred securities included in AOCI in the accompanying balance sheets totaled $40.4 million ($31.9 million, net of tax) at March 31, 2022 and $1.5 million ($1.2 million, net of tax) at December 31, 2021. Any net unrealized gain or loss on the transferred securities included in AOCI at the time of transfer will be amortized over the remaining life of the underlying security as an adjustment to the yield on those securities. Securities transferred with losses included in AOCI continue to be included in management’s assessment for impairment for each individual security. We transferred these securities due to overall balance sheet strategies and our management has the current intent and ability to hold these securities until maturity.

Investment securities and MBS with carrying values of $1.49 billion and $1.61 billion were pledged as of March 31, 2022 and December 31, 2021, respectively, to collateralize FHLB borrowings, borrowings from the FRDW, repurchase agreements and public fund deposits, for potential liquidity needs or other purposes as required by law.

The following tables present the fair value and unrealized losses on AFS and HTM investment securities and MBS, if applicable, for which an allowance for credit losses has not been recorded as of March 31, 2022 and December 31, 2021, segregated by major security type and length of time in a continuous loss position (in thousands):


	March 31, 2022
	Less Than 12 Months				More Than 12 Months				Total
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
AVAILABLE FOR SALE
Investment securities:


State and political subdivisions	$	1,030,604	$	58,873	$	—	$	—	$	1,030,604	$	58,873
Corporate bonds and other	108,153		3,191		—		—		108,153		3,191

MBS:
Residential	106,742		2,113		4,572		581		111,314		2,694
Commercial	9,939		32		3,709		556		13,648		588
Total	$	1,255,438	$	64,209	$	8,281	$	1,137	$	1,263,719	$	65,346

HELD TO MATURITY
Investment securities:
State and political subdivisions	$	223,589	$	12,576	$	17,255	$	191	$	240,844	$	12,767
MBS:
Residential	3,617		64		—		—		3,617		64
Commercial	22,857		260		—		—		22,857		260
Total	$	250,063	$	12,900	$	17,255	$	191	$	267,318	$	13,091

	December 31, 2021
	Less Than 12 Months				More Than 12 Months				Total
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
AVAILABLE FOR SALE
Investment securities:
U.S. Treasury	$	9,947	$	50	$	—	$	—	$	9,947	$	50

State and political subdivisions	260,509		3,622		7,608		592		268,117		4,214
Corporate bonds and other	35,597		209		—		—		35,597		209

MBS:
Residential	1,225		3		5,168		269		6,393		272
Commercial	4,274		7		4,674		198		8,948		205
Total	$	311,552	$	3,891	$	17,450	$	1,059	$	329,002	$	4,950

For those AFS debt securities in an unrealized loss position where management (i) has the intent to sell or (ii) where it will more-likely-than-not be required to sell the security before the recovery of its amortized cost basis, we write the security down to fair value with an adjustment to earnings. As of March 31, 2022, management had the intent to sell certain AFS securities with unrealized losses which were insignificant to the financial statements. For those AFS debt securities in an unrealized loss position that do not meet either of these criteria, management assesses whether the decline in fair value has resulted from credit-related factors, using both qualitative and quantitative criteria. Determining the allowance under the credit loss method requires the use of a discounted cash flow method to assess the credit losses. Any credit-related impairment will be recognized in allowance for credit losses on the balance sheet with a corresponding adjustment to earnings. Noncredit-related impairment, the portion of the impairment relating to factors other than credit (such as changes in market interest rates), is recognized in other comprehensive income, net of tax.

investment and MBS are due to changes in interest rates and spreads and other market conditions. At March 31, 2022, we had 500 AFS debt securities in an unrealized loss position. Our state and political subdivisions are highly rated municipal securities with a long history of no credit losses. Our AFS MBS are highly rated securities which are either explicitly or implicitly backed by the U.S. Government through its agencies which are highly rated by major ratings agencies and also have a long history of no credit losses. Our corporate bonds and other investment securities consist of highly rated investment grade bonds.

We assess the likelihood of default and the potential amount of default when assessing our HTM securities for credit losses. We utilize term structures and, due to no prior loss exposure on our state and political subdivision securities, we currently apply a third-party average loss given default rate to model our securities. Due to a small number of HTM municipal securities in our portfolio as of March 31, 2022 and 2021, we elected to use the specific identification method to model these securities which aligns with our third-party fair value measurement process. The model determined any expected credit loss over the life of these securities to be remote. Management further evaluated the remote expectation of loss along with the qualitative factors associated with these securities and concluded that, due to the securities being highly rated municipals with a long history of no credit losses, no credit loss should be recognized for these securities for the three months ended March 31, 2022 or 2021.

The accrued interest receivable on our debt securities is excluded from the credit loss estimate and is included in interest receivable on our consolidated balance sheets. As of March 31, 2022, accrued interest receivable on AFS and HTM debt securities totaled $13.0 million and $2.8 million, respectively. As of December 31, 2021, accrued interest receivable on AFS and HTM debt securities totaled $25.6 million and $244,000, respectively. No HTM debt securities were past-due or on nonaccrual status as of March 31, 2022 or December 31, 2021.

There was a $1.5 million net realized loss from the AFS securities portfolio for the three months ended March 31, 2022, which consisted of $1.8 million in realized losses and $238,000 in realized gains. There was a $2.0 million net realized gain from the AFS securities portfolio for the three months ended March 31, 2021, which consisted of $2.1 million in realized gains and $52,000 in realized losses. There were no sales from the HTM portfolio during the three months ended March 31, 2022 or 2021. We calculate realized gains and losses on sales of securities under the specific identification method.

Expected maturities on our securities may differ from contractual maturities because issuers may have the right to call or prepay obligations. MBS are presented in total by category since MBS are typically issued with stated principal amounts and are backed by pools of mortgages that have loans with varying maturities. The characteristics of the underlying pool of mortgages, such as fixed-rate or adjustable-rate, as well as prepayment risk, are passed on to the security holder. The term of a mortgage-backed pass-through security thus approximates the term of the underlying mortgages and can vary significantly due to prepayments.


	March 31, 2022
	Amortized Cost		Fair Value
AVAILABLE FOR SALE
Investment securities:
Due in one year or less	$	2,247	$	2,265
Due after one year through five years	24,972		25,187
Due after five years through ten years	157,846		155,194
Due after ten years	1,573,620		1,524,865
	1,758,685		1,707,511
MBS:	358,912		358,473
Total	$	2,117,597	$	2,065,984


	March 31, 2022
	Amortized Cost		Fair Value
HELD TO MATURITY
Investment securities:
Due in one year or less	$	120	$	120
Due after one year through five years	529		530
Due after five years through ten years	139		140
Due after ten years	385,785		373,960
	386,573		374,750
MBS:	87,746		87,871
Total	$	474,319	$	462,621

Equity investments on our consolidated balance sheets include Community Reinvestment Act funds with a readily determinable fair value as well as equity investments without readily determinable fair values. At March 31, 2022 and December 31, 2021, we had equity investments recorded in our consolidated balance sheets of $11.5 million and $11.8 million, respectively.


	Three Months Ended March 31,
	2022		2021
Net gains (losses) recognized during the period on equity investments	$	(275)	$	(107)
Less: Net gains recognized during the period on equity investments sold during the period	—		—
Unrealized gains (losses) recognized during the reporting period on equity investments held at the reporting date	$	(275)	$	(107)

Our FHLB stock, which has limited marketability, is carried at cost and is assessed quarterly for other-than-temporary impairment. Based upon evaluation by management at March 31, 2022, our FHLB stock was not impaired and thus was not considered to be other-than-temporarily impaired.