XML 20 R10.htm IDEA: XBRL DOCUMENT
v3.24.2.u1

Securities | 6 Months Ended
--- | ---
Jun. 30, 2024
Investments, Debt and Equity Securities [Abstract] |
Securities | Securities The fair value of securities is as follows:
| June 30, 2024
| Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value
Available for sale |  |  |  |  |  |  |
U.S. Treasury and federal agencies | $ | 71,419 |  |  | $ | — |  |  | $ | (8,754) |  |  | $ | 62,665 |
State and municipal | 352,223 |  |  | 2 |  |  | (57,389) |  |  | 294,836 |
Federal agency collateralized mortgage obligations | 3,702 |  |  | — |  |  | (368) |  |  | 3,334 |
Federal agency mortgage-backed pools | 154,479 |  |  | — |  |  | (24,161) |  |  | 130,318 |
Corporate notes | 41,605 |  |  | — |  |  | (5,704) |  |  | 35,901 |
Total available for sale investment securities | $ | 623,428 |  |  | $ | 2 |  |  | $ | (96,376) |  |  | $ | 527,054 |
| June 30, 2024
| 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 | $ | 284,114 |  |  | $ | — |  |  | $ | (41,917) |  |  | $ | 242,197 |  |  | $ | — |  |  | $ | 284,114 |
State and municipal | 1,064,638 |  |  | 160 |  |  | (178,390) |  |  | 886,408 |  |  | (21) |  |  | 1,064,617 |
Federal agency collateralized mortgage obligations | 48,668 |  |  | — |  |  | (8,128) |  |  | 40,540 |  |  | — |  |  | 48,668 |
Federal agency mortgage-backed pools | 314,069 |  |  | — |  |  | (49,255) |  |  | 264,814 |  |  | — |  |  | 314,069 |
Private labeled mortgage-backed pools | 30,780 |  |  | — |  |  | (4,534) |  |  | 26,246 |  |  | (7) |  |  | 30,773 |
Corporate notes | 162,170 |  |  | — |  |  | (25,388) |  |  | 136,782 |  |  | (130) |  |  | 162,040 |
Total held to maturity investment securities | $ | 1,904,439 |  |  | $ | 160 |  |  | $ | (307,612) |  |  | $ | 1,596,987 |  |  | $ | (158) |  |  | $ | 1,904,281 |
| 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 |
The amortized cost and fair value of securities available for sale and held to maturity at June 30, 2024 and December 31, 2023, 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.
| June 30, 2024 |  | December 31, 2023
| Amortized Cost |  | Fair Value |  | Amortized Cost |  | Fair Value
Available for sale |  |  |  |  |  |  |
Within one year | $ | 3,646 |  |  | $ | 3,618 |  |  | $ | 5,505 |  |  | $ | 5,408 |
One to five years | 105,358 |  |  | 93,966 |  |  | 100,301 |  |  | 89,650 |
Five to ten years | 175,739 |  |  | 145,553 |  |  | 167,764 |  |  | 141,203 |
After ten years | 180,504 |  |  | 150,265 |  |  | 195,984 |  |  | 170,113 |
| 465,247 |  |  | 393,402 |  |  | 469,554 |  |  | 406,374 |
Federal agency collateralized mortgage obligations | 3,702 |  |  | 3,334 |  |  | 3,931 |  |  | 3,580 |
Federal agency mortgage–backed pools | 154,479 |  |  | 130,318 |  |  | 161,130 |  |  | 137,297 |
Total available for sale investment securities | $ | 623,428 |  |  | $ | 527,054 |  |  | $ | 634,615 |  |  | $ | 547,251 |
Held to maturity |  |  |  |  |  |  |
Within one year | $ | 22,563 |  |  | $ | 22,312 |  |  | $ | 33,483 |  |  | $ | 33,169 |
One to five years | 217,174 |  |  | 207,041 |  |  | 225,957 |  |  | 216,354 |
Five to ten years | 357,082 |  |  | 305,973 |  |  | 350,843 |  |  | 304,067 |
After ten years | 914,103 |  |  | 730,061 |  |  | 928,209 |  |  | 768,927 |
| 1,510,922 |  |  | 1,265,387 |  |  | 1,538,492 |  |  | 1,322,517 |
Federal agency collateralized mortgage obligations | 48,668 |  |  | 40,540 |  |  | 51,325 |  |  | 43,479 |
Federal agency mortgage–backed pools | 314,069 |  |  | 264,814 |  |  | 323,649 |  |  | 275,028 |
Private labeled mortgage–backed pools | 30,780 |  |  | 26,246 |  |  | 32,329 |  |  | 27,734 |
Total held to maturity investment securities | $ | 1,904,439 |  |  | $ | 1,596,987 |  |  | $ | 1,945,795 |  |  | $ | 1,668,758 |
As of June 30, 2024, investment securities with a carrying value of $144.4 million were pledged as collateral against $1.2 billion of Federal Home Loan Bank (FHLB) borrowings. The following tables show 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.
| June 30, 2024
| 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 | $ | — |  |  | $ | — |  |  | $ | 62,665 |  |  | $ | (8,754) |  |  | $ | 62,665 |  |  | $ | (8,754) |
State and municipal | 1,664 |  |  | (291) |  |  | 292,505 |  |  | (57,098) |  |  | 294,169 |  |  | (57,389) |
Federal agency collateralized mortgage obligations | — |  |  | — |  |  | 3,334 |  |  | (368) |  |  | 3,334 |  |  | (368) |
Federal agency mortgage–backed pools | — |  |  | — |  |  | 130,319 |  |  | (24,161) |  |  | 130,319 |  |  | (24,161) |
Corporate notes | — |  |  | — |  |  | 35,901 |  |  | (5,704) |  |  | 35,901 |  |  | (5,704) |
Total temporarily impaired securities | $ | 1,664 |  |  | $ | (291) |  |  | $ | 524,724 |  |  | $ | (96,085) |  |  | $ | 526,388 |  |  | $ | (96,376) |
| 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 temporarily impaired securities | $ | 2,387 |  |  | $ | (236) |  |  | $ | 543,248 |  |  | $ | (87,583) |  |  | $ | 545,635 |  |  | $ | (87,819) |
Certain investments in debt securities are reported in the consolidated financial statements at an amount less than their historical cost. As of June 30, 2024 and December 31, 2023, the Company had 2,314 and 2,290 securities, respectively, with market values below their cost basis. The total fair value of these investments at June 30, 2024 and December 31, 2023 was $2.1 billion and $2.1 billion, which is approximately 86.5% and 85.1%, 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 was recorded at June 30, 2024 or December 31, 2023. 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 Condensed 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 consider 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 June 30, 2024 and December 31, 2023, there were no past due principal and interest payments associated with these securities. An allowance for credit loss of $158,000 and $157,000 was recorded on these securities based on applying the long-term historical rating agency credit loss rate for similarly rated securities at June 30, 2024 and December 31, 2023, respectively. On a quarterly basis, the Company refreshes the credit quality indicator of each held-to-maturity security. The Company applies ratings derived from Nationally Recognized Statistical Rating Organizations ("NRSRO"), specifically Moody's and Standard & Poor's. For state and municipal securities where no rating is available from the NRSROs, a consistent internally-assigned rating methodology is applied. The amortized cost of these securities in the following tables subject to this methodology totaled $131.9 million as of June 30, 2024, and $143.7 million as of December 31, 2023. The following table summarizes credit ratings of our held-to-maturity securities at amortized cost for the periods indicated:
June 30, 2024 | AAA |  | AA |  | A |  | BBB |  | BB |  | Not Rated |  | Total
U.S. Treasury and federal agencies | $ | — |  |  | $ | 284,114 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 284,114 |
State and municipal | 284,849 |  |  | 713,834 |  |  | 63,772 |  |  | 2,183 |  |  | — |  |  | — |  |  | 1,064,638 |
Federal agency collateralized mortgage obligations | 48,668 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 48,668 |
Federal agency mortgage-backed pools | 314,069 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 314,069 |
Private labeled mortgage-backed pools | 30,780 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 30,780 |
Corporate notes | — |  |  | 6,193 |  |  | 11,691 |  |  | 75,926 |  |  | 4,550 |  |  | 63,810 |  |  | 162,170 |
Total | $ | 678,366 |  |  | $ | 1,004,141 |  |  | $ | 75,463 |  |  | $ | 78,109 |  |  | $ | 4,550 |  |  | $ | 63,810 |  |  | $ | 1,904,439 |
December 31, 2023 | AAA |  | AA |  | A |  | BBB |  | BB |  | Not Rated |  | Total
U.S. Treasury and federal agencies | $ | — |  |  | $ | 287,259 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 287,259 |
State and municipal | 285,748 |  |  | 730,907 |  |  | 69,658 |  |  | 2,186 |  |  | — |  |  | — |  |  | 1,088,499 |
Federal agency collateralized mortgage obligations | 51,325 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 51,325 |
Federal agency mortgage-backed pools | 323,649 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 323,649 |
Private labeled mortgage-backed pools | 32,329 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 32,329 |
Corporate notes | — |  |  | 4,260 |  |  | 11,831 |  |  | 78,197 |  |  | 4,556 |  |  | 63,890 |  |  | 162,734 |
Total | $ | 693,051 |  |  | $ | 1,022,426 |  |  | $ | 81,489 |  |  | $ | 80,383 |  |  | $ | 4,556 |  |  | $ | 63,890 |  |  | $ | 1,945,795 |
The following table details activity in the allowance for credit losses on held-to-maturity securities during the three and six months ended June 30, 2024 and 2023.
| Three Months Ended | Six Months Ended
| June 30 | June 30
| 2024 |  | 2023 |  | 2024 |  | 2023
Beginning balance | $ | 158 |  |  | $ | — |  |  | $ | 157 |  |  | $ | — |
Credit loss expense (benefit) | — |  |  | — |  |  | 1 |  |  | — |
Ending balance | $ | 158 |  |  | $ | — |  |  | $ | 158 |  |  | $ | — |
Accrued interest receivable on available for sale debt securities and held to maturity securities totaled $14.4 million at June 30, 2024 and $14.7 million at December 31, 2023 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, based on specific identification method, are presented below.
|  |  | Three Months Ended |  | Six Months Ended
|  |  | June 30 |  | June 30
|  |  |  |  | 2024 |  | 2023 |  | 2024 |  | 2023
Sales of securities available for sale |  |  |  |  |  |  |  |  |  |  |
Proceeds |  |  |  |  | $ | — |  |  | $ | 24,668 |  |  | $ | — |  |  | $ | 88,194 |
Gross gains |  |  |  |  | — |  |  | 86 |  |  | — |  |  | 215 |
Gross losses |  |  |  |  | — |  |  | (66) |  |  | — |  |  | (695) |

X
- References No definition available. + Details
Name: | us-gaap_InvestmentsDebtAndEquitySecuritiesAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for investments in certain debt and equity securities. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 940 -SubTopic 320 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/940-320/tableOfContent Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Name Regulation S-K (SK) -Number 229 -Section 1403 -Paragraph b -Publisher SEC Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 320 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/320/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 320 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 10 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481800/320-10-50-10 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6B -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6B Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6B -Subparagraph (c) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6B Reference 7: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 942 -SubTopic 320 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/942-320/tableOfContent + Details
Name: | us-gaap_InvestmentsInDebtAndMarketableEquitySecuritiesAndCertainTradingAssetsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration