
	December 31, 2023
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Available for sale
U.S. Treasury and federal agencies	$	72,938	—		$	(8,561)	$	64,377
State and municipal	353,299		—		(49,269)		304,030
Federal agency collateralized mortgage obligations	3,931		—		(351)		3,580
Federal agency mortgage–backed pools	161,130		—		(23,833)		137,297

Corporate notes	43,317		455		(5,805)		37,967
Total available for sale investment securities	$	634,615	$	455	$	(87,819)	$	547,251


	December 31, 2023
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Allowance for Credit Losses		Net Carrying Amount
Held to maturity
U.S. Treasury and federal agencies	$	287,259	$	—	$	(41,299)	$	245,960	$	—	$	287,259
State and municipal	1,088,499		1,185		(150,323)		939,361		(20)		1,088,479
Federal agency collateralized mortgage obligations	51,325		—		(7,846)		43,479		—		51,325
Federal agency mortgage–backed pools	323,649		—		(48,621)		275,028		—		323,649
Private labeled mortgage–backed pools	32,329		—		(4,595)		27,734		(7)		32,322
Corporate notes	162,734		—		(25,538)		137,196		(130)		162,604
Total held to maturity investment securities	$	1,945,795	$	1,185	$	(278,222)	$	1,668,758	$	(157)	$	1,945,638


	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 Company elected to transfer 475 AFS securities with an aggregate fair value of $490.2 million to a classification of HTM on December 31, 2021. 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 gain of $5.9 million, 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 amortized

The amortized cost and fair value of securities available for sale and held to maturity at December 31, 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.


	December 31, 2023				December 31, 2022
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Available for sale
Within one year	$	5,505	$	5,408	$	1,535	$	1,512
One to five years	100,301		89,650		340,212		312,137
Five to ten years	167,764		141,203		238,045		204,282
After ten years	195,984		170,113		303,936		257,756
	469,554		406,374		883,728		775,687
Federal agency collateralized mortgage obligations	3,931		3,580		33,011		31,215
Federal agency mortgage–backed pools	161,130		137,297		220,963		190,656

Total available for sale investment securities	$	634,615	$	547,251	$	1,137,702	$	997,558
Held to maturity
Within one year	$	33,483	$	33,169	$	32,610	$	32,382
One to five years	225,957		216,354		222,443		209,854
Five to ten years	350,843		304,067		324,967		280,618
After ten years	928,209		768,927		1,006,745		793,544
	1,538,492		1,322,517		1,586,765		1,316,398
Federal agency collateralized mortgage obligations	51,325		43,479		56,564		47,699
Federal agency mortgage–backed pools	323,649		275,028		343,953		287,239
Private labeled mortgage–backed pools	32,329		27,734		35,466		29,973
Total held to maturity investment securities	$	1,945,795	$	1,668,758	$	2,022,748	$	1,681,309

The following table shows the gross unrealized losses and the fair value of the Company’s available for sale investments, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at December 31, 2023.


	December 31, 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	$	—	$	—	$	64,377	$	(8,561)	$	64,377	$	(8,561)
State and municipal	2,387		(236)		301,643		(49,033)		304,030		(49,269)
Federal agency collateralized mortgage obligations	—		—		3,580		(351)		3,580		(351)
Federal agency mortgage–backed pools	—		—		137,289		(23,833)		137,289		(23,833)

Corporate notes	—		—		36,359		(5,805)		36,359		(5,805)
Total securities	$	2,387	$	(236)	$	543,248	$	(87,583)	$	545,635	$	(87,819)

The following table shows the gross unrealized losses and the fair value of the Company’s available for sale and held to maturity investments, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at December 31, 2022.


	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 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 December 31, 2023 and 2022, the Company had 2,290 and 2,828 securities, respectively, with market values below their cost basis. The total fair value of these investments at December 31, 2023 and 2022 was $2.1 billion and $2.6 billion, which is approximately 85% and 86%, 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.

The allowance for credit losses for held to maturity securities is a contra asset valuation account that is deducted from the carrying amount of held to maturity securities to present the net amount expected to be collected. Held to maturity securities are charged off against the allowance for credit loss when deemed uncollectible. Adjustments to the allowance for credit loss are reported in our Consolidated Statements of Income in credit loss expense. We measure expected credit losses on held to maturity securities on a collective basis by major security type with each type sharing similar risk characteristics, and considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts. With regard to U.S. Government–sponsored treasuries, agency and mortgage–backed securities, all these securities are issued by a U.S. government–sponsored entity

and have an implicit or explicit government guarantee; therefore, no allowance for credit losses has been recorded for these securities. With regard to obligations of states and municipal, private label mortgage–backed and corporate note held to maturity securities, we consider (1) issuer bond ratings, (2) historical loss rates for given bond ratings, (3) the financial condition of the issuer, and (4) whether issuers continue to make timely principal and interest payments under the contractual terms of the securities. Historical loss rates associated with securities having similar grades as those in our portfolio have been insignificant. As of December 31, 2023, there were no past due principal and interest payments associated with these securities. An allowance for credit loss of $157,000 recorded on these securities based on applying the long–term historical rating agency credit loss rate for similarly rated securities.

Accrued interest receivable on available for sale debt securities and held to maturity securities totaled $14.7 million and $17.8 million at December 31, 2023 and December 31, 2022, respectively, 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.

The Company pledges securities to secure retail and corporate repurchase agreements to the Federal Reserve for borrowing availability and as settlements for the fair value of swap agreements. At December 31, 2023, the Company had pledged $145.2 million of fair value or $170.3 million of amortized cost, in securities as collateral for $136.0 million in repurchase agreements, $1.4 billion of fair value or $1.7 billion of amortized cost, in securities as collateral for borrowing availability at the Federal Reserve with $430.0 million current outstanding borrowings and $20.2 million of fair value or $23.0 million of amortized cost, in securities as collateral for $26.6 million in settlements on the fair value of swap agreements.