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Securities | 9 Months Ended
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Sep. 30, 2023
Investments, Debt and Equity Securities [Abstract] |
Securities | Securities The fair value of securities is as follows:
| September 30, 2023
| Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value
Available for sale |  |  |  |  |  |  |
U.S. Treasury and federal agencies | $ | 293,785 |  |  | $ | — |  |  | $ | (27,935) |  |  | $ | 265,850 |
State and municipal | 425,096 |  |  | — |  |  | (84,784) |  |  | 340,312 |
Federal agency collateralized mortgage obligations | 23,210 |  |  | — |  |  | (1,897) |  |  | 21,313 |
Federal agency mortgage-backed pools | 200,728 |  |  | — |  |  | (34,839) |  |  | 165,889 |
Corporate notes | 81,803 |  |  | 338 |  |  | (10,337) |  |  | 71,804 |
Total available for sale investment securities | $ | 1,024,622 |  |  | $ | 338 |  |  | $ | (159,792) |  |  | $ | 865,168 |
Held to maturity |  |  |  |  |  |  |
U.S. Treasury and federal agencies | $ | 287,561 |  |  | $ | — |  |  | $ | (53,553) |  |  | $ | 234,008 |
State and municipal | 1,101,933 |  |  | 15 |  |  | (243,639) |  |  | 858,309 |
Federal agency collateralized mortgage obligations | 52,573 |  |  | — |  |  | (9,896) |  |  | 42,677 |
Federal agency mortgage-backed pools | 328,410 |  |  | — |  |  | (64,353) |  |  | 264,057 |
Private labeled mortgage-backed pools | 32,992 |  |  | — |  |  | (5,694) |  |  | 27,298 |
Corporate notes | 163,014 |  |  | — |  |  | (32,518) |  |  | 130,496 |
Total held to maturity investment securities | $ | 1,966,483 |  |  | $ | 15 |  |  | $ | (409,653) |  |  | $ | 1,556,845 |
| December 31, 2022
| Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value
Available for sale |  |  |  |  |  |  |
U.S. Treasury and federal agencies | $ | 294,329 |  |  | $ | — |  |  | $ | (27,150) |  |  | $ | 267,179 |
State and municipal | 505,006 |  |  | 140 |  |  | (71,602) |  |  | 433,544 |
Federal agency collateralized mortgage obligations | 33,011 |  |  | — |  |  | (1,796) |  |  | 31,215 |
Federal agency mortgage-backed pools | 220,963 |  |  | — |  |  | (30,307) |  |  | 190,656 |
Corporate notes | 84,393 |  |  | 195 |  |  | (9,624) |  |  | 74,964 |
Total available for sale investment securities | $ | 1,137,702 |  |  | $ | 335 |  |  | $ | (140,479) |  |  | $ | 997,558 |
Held to maturity |  |  |  |  |  |  |
U.S. Treasury and federal agencies | $ | 295,250 |  |  | $ | — |  |  | $ | (49,237) |  |  | $ | 246,013 |
State and municipal | 1,127,669 |  |  | 374 |  |  | (192,458) |  |  | 935,585 |
Federal agency collateralized mortgage obligations | 56,564 |  |  | — |  |  | (8,865) |  |  | 47,699 |
Federal agency mortgage-backed pools | 343,953 |  |  | — |  |  | (56,714) |  |  | 287,239 |
Private labeled mortgage-backed pools | 35,466 |  |  | — |  |  | (5,493) |  |  | 29,973 |
Corporate notes | 163,846 |  |  | — |  |  | (29,046) |  |  | 134,800 |
Total held to maturity investment securities | $ | 2,022,748 |  |  | $ | 374 |  |  | $ | (341,813) |  |  | $ | 1,681,309 |
The Company elected to transfer 793 AFS securities with an aggregate fair value of $120.9 million to a classification of HTM on March 31, 2022. In accordance with FASB ASC 320–10–55–24, the transfer from AFS to HTM must be recorded at the fair value of the AFS securities at the time of transfer. The net unrealized holding loss of $814,000, net of tax, at the date of transfer was retained in accumulated other comprehensive income (loss), with the associated pre–tax amount retained in the carrying value of the HTM securities. Such amounts will be accreted to comprehensive income over the remaining life of the securities. The fair value of the transferred AFS securities became the book value of the HTM securities at March 31, 2022. The amortized cost and fair value of securities available for sale and held to maturity at September 30, 2023 and December 31, 2022, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.
| September 30, 2023 |  |
| Amortized Cost |  | Fair Value |  |  |  |
Available for sale |  |  |  |  |  |  |
Within one year | $ | 5,449 |  |  | $ | 5,329 |  |  |  |  |
One to five years | 364,641 |  |  | 330,882 |  |  |  |  |
Five to ten years | 192,161 |  |  | 153,784 |  |  |  |  |
After ten years | 238,433 |  |  | 187,971 |  |  |  |  |
| 800,684 |  |  | 677,966 |  |  |  |  |
Federal agency collateralized mortgage obligations | 23,210 |  |  | 21,313 |  |  |  |  |
Federal agency mortgage–backed pools | 200,728 |  |  | 165,889 |  |  |  |  |
Total available for sale investment securities | $ | 1,024,622 |  |  | $ | 865,168 |  |  |  |  |
Held to maturity |  |  |  |  |  |  |
Within one year | $ | 35,434 |  |  | $ | 35,149 |  |  |  |  |
One to five years | 228,119 |  |  | 212,226 |  |  |  |  |
Five to ten years | 340,018 |  |  | 278,547 |  |  |  |  |
After ten years | 948,937 |  |  | 696,891 |  |  |  |  |
| 1,552,508 |  |  | 1,222,813 |  |  |  |  |
Federal agency collateralized mortgage obligations | 52,573 |  |  | 42,677 |  |  |  |  |
Federal agency mortgage–backed pools | 328,410 |  |  | 264,057 |  |  |  |  |
Private labeled mortgage–backed pools | 32,992 |  |  | 27,298 |  |  |  |  |
Total held to maturity investment securities | $ | 1,966,483 |  |  | $ | 1,556,845 |  |  |  |  |
The following table shows the gross unrealized losses and the fair value of the Company’s investments, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position.
| September 30, 2023
| Less than 12 Months |  | 12 Months or More |  | Total
| Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses
Investment Securities |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury and federal agencies | $ | 1,322 |  |  | $ | (12) |  |  | $ | 498,536 |  |  | $ | (81,476) |  |  | $ | 499,858 |  |  | $ | (81,488) |
State and municipal | 123,235 |  |  | (7,558) |  |  | 1,066,492 |  |  | (320,865) |  |  | 1,189,727 |  |  | (328,423) |
Federal agency collateralized mortgage obligations | — |  |  | — |  |  | 63,990 |  |  | (11,793) |  |  | 63,990 |  |  | (11,793) |
Federal agency mortgage–backed pools | 13 |  |  | (1) |  |  | 429,933 |  |  | (99,191) |  |  | 429,946 |  |  | (99,192) |
Private labeled mortgage–backed pools | — |  |  | — |  |  | 27,298 |  |  | (5,694) |  |  | 27,298 |  |  | (5,694) |
Corporate notes | — |  |  | — |  |  | 200,899 |  |  | (42,855) |  |  | 200,899 |  |  | (42,855) |
Total temporarily impaired securities | $ | 124,570 |  |  | $ | (7,571) |  |  | $ | 2,287,148 |  |  | $ | (561,874) |  |  | $ | 2,411,718 |  |  | $ | (569,445) |
| December 31, 2022
| Less than 12 Months |  | 12 Months or More |  | Total
| Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses |  | Fair Value |  | Unrealized Losses
Investment Securities |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury and federal agencies | $ | 217,357 |  |  | $ | (16,692) |  |  | $ | 295,585 |  |  | $ | (59,695) |  |  | $ | 512,942 |  |  | $ | (76,387) |
State and municipal | 533,871 |  |  | (45,881) |  |  | 757,061 |  |  | (218,179) |  |  | 1,290,932 |  |  | (264,060) |
Federal agency collateralized mortgage obligations | 40,301 |  |  | (2,881) |  |  | 38,613 |  |  | (7,780) |  |  | 78,914 |  |  | (10,661) |
Federal agency mortgage–backed pools | 49,633 |  |  | (3,211) |  |  | 428,243 |  |  | (83,810) |  |  | 477,876 |  |  | (87,021) |
Private labeled mortgage–backed pools | — |  |  | — |  |  | 29,973 |  |  | (5,493) |  |  | 29,973 |  |  | (5,493) |
Corporate notes | 38,906 |  |  | (6,787) |  |  | 169,921 |  |  | (31,883) |  |  | 208,827 |  |  | (38,670) |
Total temporarily impaired securities | $ | 880,068 |  |  | $ | (75,452) |  |  | $ | 1,719,396 |  |  | $ | (406,840) |  |  | $ | 2,599,464 |  |  | $ | (482,292) |
Certain investments in debt securities are reported in the consolidated financial statements at an amount less than their historical cost. As of September 30, 2023 and December 31, 2022, the Company had 2,651 and 2,828 securities, respectively, with market values below their cost basis. The total fair value of these investments at September 30, 2023 and December 31, 2022 was $2.4 billion and $2.6 billion, which is approximately 99.6% and 97.0%, respectively, of the Company's available for sale and held to maturity securities portfolio. These declines resulted primarily from fluctuations in market interest rates after purchase. Management believes the declines in fair value for these securities are temporary. No allowance for credit losses for available for sale debt securities or held to maturity securities was recorded at September 30, 2023 or December 31, 2022. Accrued interest receivable on available for sale debt securities and held to maturity securities totaled $16.7 million at September 30, 2023 and $17.8 million at December 31, 2022 and is excluded from the estimate of credit losses. The U.S. government sponsored entities and agencies and mortgage–backed securities are either explicitly or implicitly guaranteed by the U.S. government, are highly rated by major credit rating agencies, and have a long history of no credit losses. Therefore, for those securities, we do not record expected credit losses. Based on an evaluation of available evidence, management believes the unrealized losses on state and municipal securities, private labeled mortgage–backed pools and corporate notes were due to changes in interest rates. Due to the contractual terms, the issuers of state and municipal securities are not allowed to settle for less than the amortized cost of the security. In addition, the Company does not intend to sell these securities prior to the recovery of the amortized cost, which may not occur until maturity. Information regarding security proceeds, gross gains and gross losses are presented below.
| Three Months Ended |  | Nine Months Ended
| September 30 |  | September 30
| 2023 |  | 2022 |  | 2023 |  | 2022
Sales of securities available for sale |  |  |  |  |  |  |
Proceeds | $ | — |  |  | $ | — |  |  | $ | 88,194 |  |  | $ | — |
Gross gains | — |  |  | — |  |  | 215 |  |  | — |
Gross losses | — |  |  | — |  |  | (695) |  |  | — |

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