XML 20 R10.htm IDEA: XBRL DOCUMENT v3.25.3
Securities
 9 Months Ended
Sep. 30, 2025
Investments, Debt and Equity Securities [Abstract]  
Securities Securities
The fair value of available-for-sale securities is as follows.
September 30, 2025
Amortized
Cost		Allowance for Credit LossesNet Carrying AmountGross
Unrealized
Gains		Gross
Unrealized
Losses		Fair Value
Available for sale
U.S. Treasury, federal agencies, and government sponsored agencies$31,836 — $31,836 $58 $(58)$31,836 
State and municipal354,290 — 354,290 1,753 (40,715)315,328 
U.S. government agency mortgage-backed securities491,207 — 491,207 3,175 (480)493,902 
Corporate notes48,750 (150)48,600 — (6,424)42,176 
Total available for sale investment securities$926,083 $(150)$925,933 $4,986 $(47,677)$883,242 
September 30, 2025
Amortized
Cost		Allowance for Credit LossesNet Carrying AmountGross
Unrealized
Gains		Gross
Unrealized
Losses		Fair
Value
Held to maturity
U.S. Treasury, federal agencies, and government sponsored agencies$— $— $— $— $— $— 
State and municipal— — — — — — 
U.S. government agency mortgage-backed securities— — — — — — 
Private labeled mortgage–backed pools— — — — — — 
Corporate notes— — — — — — 
Total held to maturity investment securities$— $— $— $— $— $— 
In August 2025, the Company reclassified its held-to-maturity investment portfolio, with a carrying value of $1.8 billion and unrealized loss of $282.6 million, to the available-for-sale portfolio as part of the Company's balance sheet repositioning. Following the reclassification, the Company sold securities with a fair value of $1.4 billion, recognizing a pre-tax loss of $299.5 million upon sale.
The fair value of trading securities is as follows:
September 30, 2025December 31, 2024
Held for Trading
U.S. Treasury, federal agencies, and government sponsored agencies$598 $— 
State and municipal— — 
U.S. government agency mortgage-backed securities— — 
Corporate notes— — 
Total trading securities$598 $— 
For the three and nine-months ending September 30, 2025, the net gains (losses) on trading securities were determined to be immaterial to the consolidated financial statements.
December 31, 2024
Amortized
Cost		Gross
Unrealized
Gains		Gross
Unrealized
Losses		Allowance for Credit LossesFair
Value
Available for sale
U.S. Treasury, federal agencies, and government sponsored agencies$2,258 $— $(457)$— $1,801 
State and municipal243,521 — (41,687)— 201,834 
U.S. government agency mortgage-backed securities17,984 — (3,441)— 14,543 
Corporate notes18,259 — (2,760)— 15,499 
Total available for sale investment securities$282,022 $— $(48,345)$— $233,677 

December 31, 2024
Amortized
Cost		Gross
Unrealized
Gains		Gross
Unrealized
Losses		Fair
Value
Held to maturity
U.S. Treasury, federal agencies, and government sponsored agencies$278,383 $— $(39,253)$239,130 
State and municipal1,048,862 958 (183,114)866,706 
U.S. government agency mortgage-backed securities349,726 — (54,904)294,822 
Private labeled mortgage–backed pools29,278 — (3,958)25,320 
Corporate notes161,599 — (21,309)140,290 
Total held to maturity investment securities$1,867,848 $958 $(302,538)$1,566,268 
Less: Allowance for credit losses(158)
Held to maturity securities, net of allowance for credit losses$1,867,690 
The amortized cost and fair value of securities available for sale and held to maturity at September 30, 2025 and December 31, 2024, 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, 2025December 31, 2024
Amortized
Cost		Fair
Value		Amortized
Cost		Fair
Value
Available for sale
Within one year$31,763 $31,797 $— $— 
One to five years49,247 48,529 — — 
Five to ten years76,478 68,141 173,533 141,915 
After ten years277,388 240,873 90,505 77,219 
434,876 389,340 264,038 219,134 
U.S. government agency mortgage-backed securities491,207 493,902 17,984 14,543 
Total available for sale investment securities$926,083 $883,242 $282,022 $233,677 
Held to maturity
Within one year$— $— $59,129 $58,304 
One to five years— — 298,362 278,007 
Five to ten years— — 366,493 312,748 
After ten years— — 764,860 597,067 
— — 1,488,844 1,246,126 
U.S. government agency mortgage-backed securities— — 349,726 294,822 
Private labeled mortgage-backed pools— — 29,278 25,320 
Total held to maturity investment securities$— $— $1,867,848 $1,566,268 
The following tables show the gross unrealized losses and the fair value of the Company’s available for sale investments in which an allowance for credit losses were not recorded, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position.
September 30, 2025
Less than 12 Months12 Months or MoreTotal
Fair
Value		Unrealized
Losses		Fair
Value		Unrealized
Losses		Fair
Value		Unrealized
Losses
Available for Sale Investment Securities
U.S. Treasury, federal agencies, and government sponsored agencies$— $— $15,694 $(58)$15,694 $(58)
State and municipal16,292 (255)202,221 (40,460)218,513 (40,715)
U.S. government agency mortgage-backed securities39,550 (466)(142)(14)39,408 (480)
Corporate notes— — 39,388 (4,361)39,388 (4,361)
Total available for sale investment securities$55,842 $(721)$257,161 $(44,893)$313,003 $(45,614)
December 31, 2024
Less than 12 Months12 Months or MoreTotal
Fair
Value		Unrealized
Losses		Fair
Value		Unrealized
Losses		Fair
Value		Unrealized
Losses
Available for Sale Investment Securities
U.S. Treasury, federal agencies, and government sponsored agencies$— $— $1,801 $(457)$1,801 $(457)
State and municipal— — 201,834 (41,687)201,834 (41,687)
U.S. government agency mortgage-backed securities— — 14,543 (3,441)14,543 (3,441)
Corporate notes— — 15,499 (2,760)15,499 (2,760)
Total available for sale investment securities$— $— $233,677 $(48,345)$233,677 $(48,345)
Certain investments in debt securities are reported in the consolidated financial statements at an amount less than their historical cost. As of September 30, 2025 and December 31, 2024, the Company had 801 and 2,115 securities, respectively, with market values below their cost basis. The total fair value of these investments at September 30, 2025 and December 31, 2024 was $0.3 billion and $1.8 billion, which is approximately 36% and 86%, respectively, of the Company's available for sale, and held to maturity securities portfolio.
The Company determines credit losses on available-for-sale investment securities by a discounted cash flow approach using the security’s prepayment-adjusted effective interest rate. The allowance for credit losses is measured as the amount by which an investment security’s amortized cost exceeds the net present value of expected future cash flows. However, the amount of credit losses for available-for-sale investment securities is limited to the amount of a security’s unrealized loss.
The following table details activity in the allowance for credit losses on available for sale debt securities during the three and nine months ended September 30, 2025 and 2024.
Three Months EndedNine Months Ended
September 30,September 30,September 30,September 30,
2025202420252024
Beginning balance$150 $— $— $— 
Credit loss expense (benefit)— — 150 — 
Ending balance$150 $— $150 $— 
Due to a specific issuer's deferral of principal and interest payments, the Company placed the security with a fair value of $2.9 million on non-accrual status and recorded a $150 thousand allowance for credit losses on certain corporate debt securities.
Based on an evaluation of available evidence, management believes the unrealized losses on available for sale state and municipal securities, private labeled mortgage–backed pools and corporate notes, excluding certain securities disclosed above, 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.
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. The Company measures 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 regards 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 September 30, 2025 and December 31, 2024, there were no past due principal and interest payments associated with these securities. An allowance for credit loss of $0 and $158 thousand was recorded on these securities based on applying the long-term historical rating agency credit loss rate for similarly rated securities at September 30, 2025 and December 31, 2024, 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 the state and municipal securities in the following tables subject to this methodology totaled $0 as of September 30, 2025, and $125.0 million as of December 31, 2024.
The following table summarizes credit ratings of our held-to-maturity securities at amortized cost for the periods indicated:
September 30, 2025AAAAAABBBBBNot RatedTotal
U.S. Treasury, federal agencies, and government sponsored agencies$— $— $— $— $— $— $— 
State and municipal— — — — — — — 
U.S. government agency mortgage-backed securities— — — — — — — 
Private labeled mortgage-backed pools— — — — — — — 
Corporate notes— — — — — — — 
Total$— $— $— $— $— $— $— 
December 31, 2024AAAAAABBBBBNot RatedTotal
U.S. Treasury, federal agencies, and government sponsored agencies$— $278,383 $— $— $— $— $278,383 
State and municipal273,629 698,428 66,079 10,726 — — 1,048,862 
U.S. government agency mortgage-backed securities349,726 — — — — — 349,726 
Private labeled mortgage-backed pools29,278 — — — — — 29,278 
Corporate notes— 6,176 11,549 75,603 4,543 63,728 161,599 
Total$652,633 $982,987 $77,628 $86,329 $4,543 $63,728 $1,867,848 
The following table details activity in the allowance for credit losses on held-to-maturity securities during the three and nine months ended September 30, 2025 and 2024.
Three Months EndedNine Months Ended
September 30,September 30,September 30,September 30,
2025202420252024
Beginning balance$142 $158 $158 $157 
Credit loss expense (benefit)(142)— (158)1 
Ending balance$— $158 $— $158 
Accrued interest receivable on available for sale debt securities and held to maturity securities totaled $5.1 million at September 30, 2025 and $12.7 million at December 31, 2024 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.
Information regarding securities proceeds, gross gains, and gross losses are presented below:
Three Months EndedNine Months Ended
September 30,September 30,September 30,September 30,
2025202420252024
Sales of available for sale securities
Proceeds$1,405,738 $— $1,409,870 $— 
Gross gains— — — — 
Gross losses(299,132)— (299,538)— 
The tax benefit of the proceeds from the sale of securities available for sale was $62.9 million for the three and nine months ended September 30, 2025.
The following table represents the fair value and amortized costs of pledged securities, excluding overnight repurchase agreements.
September 30, 2025December 31, 2024
Fair ValueAmortized CostFair ValueAmortized Cost
Pledged securities for borrowing availability at the Federal Reserve$— $— $851,384 $1,032,916 
Pledge securities for FHLB borrowings— — 279,136 333,613 
Pledged securities for derivative instruments27,660 27,391 0 0