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Investment Securities Available-for-Sale | 12 Months Ended
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Dec. 31, 2022
Investments, Debt and Equity Securities [Abstract] |
Investment Securities Available-for-Sale | Investment Securities Amortized cost and estimated fair value of securities available-for-sale and held-to-maturity are summarized as follows:
December 31, 2022 |  | Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Allowance for |  | Estimated Fair Value
(dollars in thousands) |  |  |  |  | Credit Losses |
Investment securities available-for-sale: |  |  |  |  |  |  |  |
U.S. treasury bonds |  | $ | 49,793 |  |  | $ | — |  |  | $ | (3,466) |  |  | $ | — |  |  | $ | 46,327 |
U.S. agency securities |  | 747,777 |  |  | — |  |  | (78,049) |  |  | — |  |  | 669,728 |
Residential mortgage-backed securities |  | 937,557 |  |  | 18 |  |  | (117,072) |  |  | — |  |  | 820,503 |
Commercial mortgage-backed securities |  | 56,071 |  |  | — |  |  | (5,858) |  |  | — |  |  | 50,213 |
Municipal bonds |  | 10,700 |  |  | 45 |  |  | (658) |  |  | — |  |  | 10,087 |
Corporate bonds |  | 2,000 |  |  | — |  |  | (175) |  |  | (17) |  |  | 1,808 |
Total available-for-sale securities |  | $ | 1,803,898 |  |  | $ | 63 |  |  | $ | (205,278) |  |  | $ | (17) |  |  | $ | 1,598,666 |
December 31, 2022 |  | Amortized Cost |  | Gross Unrecognized Gains |  | Gross Unrecognized Losses |  |  |  | Estimated
(dollars in thousands) |  |  |  |  |  | Fair Value
Investment securities held-to-maturity: |  |  |  |  |  |  |  |
Residential mortgage-backed securities |  | $ | 741,057 |  |  | $ | — |  |  | $ | (88,390) |  |  |  |  | $ | 652,667 |
Commercial mortgage-backed securities |  | 92,557 |  |  | — |  |  | (11,993) |  |  |  |  | 80,564 |
Municipal bonds |  | 128,273 |  |  | — |  |  | (12,092) |  |  |  |  | 116,181 |
Corporate bonds |  | 132,253 |  |  | — |  |  | (12,958) |  |  |  |  | 119,295 |
|  | 1,094,140 |  |  | $ | — |  |  | $ | (125,433) |  |  |  |  | $ | 968,707 |
Allowance for credit losses |  | (766) |  |  |  |  |  |  |  |  |
Total held-to-maturity securities, net of ACL |  | $ | 1,093,374 |  |  |  |  |  |  |  |  |
December 31, 2021 |  | Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Allowance for |  | Estimated Fair Value
(dollars in thousands) |  |  |  |  | Credit Losses |
Investment securities available-for-sale: |  |  |  |  |  |  |  |
U.S. treasury bonds |  | $ | 49,693 |  |  | $ | 22 |  |  | $ | (257) |  |  | $ | — |  |  | $ | 49,458 |
U.S. agency securities |  | 629,273 |  |  | 736 |  |  | (7,622) |  |  | — |  |  | 622,387
Residential mortgage-backed securities |  | 1,634,421 |  |  | 4,053 |  |  | (20,447) |  |  | — |  |  | 1,618,027
Commercial mortgage-backed securities |  | 58,352 |  |  | 1,644 |  |  | (350) |  |  | — |  |  | 59,646 |
Municipal bonds |  | 141,916 |  |  | 3,865 |  |  | (347) |  |  | (3) |  |  | 145,431
Corporate bonds |  | 129,012 |  |  | 648 |  |  | (584) |  |  | (617) |  |  | 128,459
|  | $ | 2,642,667 |  |  | $ | 10,968 |  |  | $ | (29,607) |  |  | $ | (620) |  |  | $ | 2,623,408 |
In addition, at December 31, 2022 and December 31, 2021, the Company held $65.1 million and $34.2 million in non marketable equity securities, respectively, in a combination of FRB and FHLB stocks, which are required to be held for regulatory purposes. The stocks are both carried at cost, classified as restricted securities, and periodically evaluated for impairment based on ultimate recovery of par value. The Company reassessed classification of certain investments in the first quarter of 2022 and, effective March 31, 2022, it transferred a total of $1.1 billion of mortgage-backed securities, municipal bonds and corporate bonds from available-for-sale to held-to-maturity securities, including $237.0 million of securities acquired in the first quarter of 2022 for which its intention to hold to maturity was finalized. At the time of transfer, the Company reversed the allowance for credit losses associated with the available-for-sale securities through the provision for credit losses. The securities were transferred at their amortized cost basis, net of any remaining unrealized gain or loss reported in accumulated other comprehensive income. The related unrealized loss of $66.2 million was included in other comprehensive loss at the time of transfer and, as of December 31, 2022, $59.1 million remains in accumulated other comprehensive loss, to be amortized out through interest income as a yield adjustment over the remaining term of the securities. No gain or loss was recorded at the time of transfer. Subsequent to transfer, the allowance for credit losses on these securities was evaluated under the accounting policy for held-to-maturity securities. Accrued interest receivable on investment securities totaled $7.8 million and $6.0 million at December 31, 2022 and December 31, 2021, respectively. The accrued interest on investment securities is excluded from the amortized cost of the securities and is reported in other assets in the Consolidated Balance Sheets. The unrealized losses that exist at December 31, 2022 are generally the result of changes in market interest rates and interest spread relationships since the investment securities were originally purchased, rather than credit quality concerns. However, as of December 31, 2022 and 2021, the Company determined that certain of the unrealized loss positions in available-for-sale and held-to-maturity corporate and municipal bonds were evidence of expected credit losses. An allowance for credit losses of $17 thousand was recorded for AFS securities and $766 thousand for HTM securities in 2022. The weighted average duration of debt securities, which comprise 100% of total investment securities, is 4.8 years. Provision recorded for credit losses for securities was $163 thousand as of December 31, 2022. If quoted prices are not available, fair value is measured using independent pricing models or other model-based valuation techniques such as the present value of future cash flows, adjusted for the security’s credit rating, prepayment assumptions and other factors such as credit loss assumptions. The Company does not intend to sell the held-to-maturity investments and it is more likely than not that the Company will not have to sell the securities before recovery of its amortized cost basis, which may be at maturity. Gross unrealized losses and fair value by length of time that the individual available-for-sale securities have been in a continuous unrealized loss position as of December 31, 2022 and 2021 are as follows:
Investment securities available-for-sale: |  | Less than 12 Months |  | 12 Months or Greater |  | Total
December 31, 2022 |  | Number of Securities |  | Estimated Fair Value |  | Unrealized Losses |  | Estimated Fair Value |  | Unrealized Losses |  | Estimated Fair Value |  | Unrealized Losses
(dollars in thousands) |  |  |  |  |  |  |
U.S. treasury bonds |  | 2 |  |  | $ | — |  |  | $ | — |  |  | $ | 46,327 |  |  | $ | (3,466) |  |  | $ | 46,327 |  |  | $ | (3,466) |
U.S. agency securities |  | 85 |  |  | 490,699 |  |  | (58,437) |  |  | 179,029 |  |  | (19,612) |  |  | 669,728 |  |  | (78,049) |
Residential mortgage-backed securities |  | 157 |  |  | 3,994 |  |  | — |  |  | 808,697 |  |  | (117,073) |  |  | 812,691 |  |  | (117,073) |
Commercial mortgage-backed securities |  | 14 |  |  | 471 |  |  | (2) |  |  | 49,742 |  |  | (5,855) |  |  | 50,213 |  |  | (5,857) |
Municipal bonds |  | 1 |  |  | — |  |  | — |  |  | 8,299 |  |  | (658) |  |  | 8,299 |  |  | (658) |
Corporate bonds |  | 1 |  |  | — |  |  | — |  |  | 1,825 |  |  | (175) |  |  | 1,825 |  |  | (175) |
|  | 260 |  | $ | 495,164 |  |  | $ | (58,439) |  |  | $ | 1,093,919 |  |  | $ | (146,839) |  |  | $ | 1,589,083 |  |  | $ | (205,278) |
Investment securities held-to-maturity: |  | Less than 12 Months |  | 12 Months or Greater |  | Total
December 31, 2022 |  | Number of Securities |  | Estimated Fair Value |  | Unrealized Losses |  | Estimated Fair Value |  | Unrealized Losses |  | Estimated Fair Value |  | Unrealized Losses
(dollars in thousands) |  |  |  |  |  |  |
Residential mortgage-backed securities |  | 143 |  |  | $ | — |  |  | $ | — |  |  | $ | 652,667 |  |  | $ | (88,390) |  |  | $ | 652,667 |  |  | $ | (88,390) |
Commercial mortgage-backed securities |  | 16 |  |  | — |  |  | — |  |  | 80,564 |  |  | (11,993) |  |  | $ | 80,564 |  |  | (11,993) |
Municipal bonds |  | 43 |  |  | 3,110 |  |  | (45) |  |  | 113,071 |  |  | (12,047) |  |  | $ | 116,181 |  |  | (12,092) |
Corporate bonds |  | 30 |  |  | 20,771 |  |  | (3,183) |  |  | 86,451 |  |  | (9,775) |  |  | $ | 107,222 |  |  | (12,958) |
|  | 232 |  | $ | 23,881 |  |  | $ | (3,228) |  |  | $ | 932,753 |  |  | $ | (122,205) |  |  | $ | 956,634 |  |  | $ | (125,433) |
Investment securities available-for-sale |  |  |  | Less than 12 Months |  | 12 Months or Greater |  | Total
December 31, 2021 |  | Number of Securities |  | Estimated Fair Value |  | Unrealized Losses |  | Estimated Fair Value |  | Unrealized Losses |  | Estimated Fair Value |  | Unrealized Losses
(dollars in thousands) |  |  |  |  |  |  |
U.S. treasury bonds |  | 1 |  |  | $ | 24,593 |  |  | $ | (257) |  |  | $ | — |  |  | $ | — |  |  | $ | 24,593 |  |  | $ | (257) |
U.S. agency securities |  | 64 |  |  | 452,966 |  |  | (6,256) |  |  | 68,977 |  |  | (1,366) |  |  | 521,943 |  |  | (7,622) |
Residential mortgage-backed securities |  | 149 |  |  | 1,327,519 |  |  | $ | (16,841) |  |  | 84,500 |  |  | (3,606) |  |  | 1,412,019 |  |  | (20,447) |
Commercial mortgage-backed securities |  | 4 |  |  | — |  |  | — |  |  | 23,561 |  |  | (350) |  |  | 23,561 |  |  | (350) |
Municipal bonds |  | 8 |  |  | 20,181 |  |  | $ | (347) |  |  | — |  |  | — |  |  | 20,181 |  |  | (347) |
Corporate bonds |  | 13 |  |  | 66,051 |  |  | $ | (584) |  |  | — |  |  | $ | — |  |  | 66,051 |  |  | (584) |
|  | 239 |  | $ | 1,891,310 |  |  | $ | (24,285) |  |  | $ | 177,038 |  |  | $ | (5,322) |  |  | $ | 2,068,348 |  |  | $ | (29,607) |
The amortized cost and estimated fair value of investments available-for-sale at December 31, 2022 and 2021 by contractual maturity are shown in the table below. Expected maturities for residential mortgage-backed securities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.
Investment securities available-for-sale: |  | December 31, 2022 |  | December 31, 2021
(dollars in thousands) |  | Amortized Cost |  | Estimated Fair Value |  | Amortized Cost |  | Estimated Fair Value
U.S. agency securities maturing: |  |  |  |  |  |  |  |
One year or less |  | $ | 549,137 |  |  | $ | 490,699 |  |  | $ | 425,597 |  |  | $ | 421,347 |
After one year through five years |  | 111,742 |  |  | 100,297 |  |  | 141,537 |  |  | 140,785 |
Five years through ten years |  | 73,886 |  |  | 68,180 |  |  | 62,092 |  |  | 60,255 |
After ten years |  | 13,012 |  |  | 10,552 |  |  |  |  |
Residential mortgage-backed securities |  | 937,557 |  |  | 820,503 |  |  | 1,634,468 |  |  | 1,618,027 |
Commercial mortgage-backed securities |  | 56,071 |  |  | 50,213 |  |  | 58,352 |  |  | 59,646 |
Municipal bonds maturing: |  |  |  |  |  |  |  |
One year or less |  | 300 |  |  | 300 |  |  | 4,806 |  |  | 4,861 |
After one year through five years |  | 1,444 |  |  | 1,488 |  |  | 25,457 |  |  | 26,816 |
Five years through ten years |  | 8,956 |  |  | 8,299 |  |  | 97,945 |  |  | 99,960 |
After ten years |  | — |  |  | — |  |  | 13,708 |  |  | 13,797 |
Corporate bonds maturing: |  |  |  |  |  |  |  |
One year or less |  | — |  |  | — |  |  | 18,924 |  |  | 18,991 |
After one year through five years |  | 2,000 |  |  | 1,825 |  |  | 54,630 |  |  | 54,833 |
Five years through ten years |  | — |  |  | — |  |  | 55,458 |  |  | 55,252 |
After ten years |  | — |  |  | — |  |  | — |  |  | — |
U.S. treasury |  | 49,793 |  |  | 46,327 |  |  | 49,693 |  |  | 49,458 |
|  | 1,803,898 |  |  | 1,598,683 |  |  | 2,642,667 |  |  | 2,624,028 |
Allowance for credit losses |  | — |  |  | (17) |  |  | — |  |  | (620) |
|  | $ | 1,803,898 |  |  | $ | 1,598,666 |  |  | $ | 2,642,667 |  |  | $ | 2,623,408 |
Investment securities held-to-maturity: |  | December 31, 2022 |  | December 31, 2021
(dollars in thousands) |  | Amortized Cost |  | Estimated Fair Value |  | Amortized Cost |  | Estimated Fair Value
Residential mortgage-backed securities |  | $ | 741,057 |  |  | $ | 652,667 |  |  | $ | — |  |  | $ | — |
Commercial mortgage-backed securities |  | 92,557 |  |  | 80,564 |  |  |  |  |
Municipal bonds maturing: |  |  |  |  |  |  |  |
One year or less |  | 3,139 |  |  | 3,110 |  |  | — |  |  | — |
After one year through five years |  | 35,579 |  |  | 33,743 |  |  | — |  |  | — |
Five years through ten years |  | 77,262 |  |  | 67,945 |  |  | — |  |  | — |
After ten years |  | 12,293 |  |  | 11,383 |  |  | — |  |  | — |
Corporate bonds maturing: |  |  |  |  |  |  |  |
One year or less |  | 23,954 |  |  | 20,771 |  |  | — |  |  | — |
After one year through five years |  | 84,953 |  |  | 77,997 |  |  | — |  |  | — |
Five years through ten years |  | 23,346 |  |  | 20,527 |  |  | — |  |  | — |
|  | 1,094,140 |  |  | 968,707 |  |  | — |  |  | — |
Allowance for credit losses |  | (766) |  |  | — |  |  | — |  |  | — |
|  | $ | 1,093,374 |  |  | $ | 968,707 |  |  | $ | — |  |  | $ | — |
In 2022, gross realized gains on sales of investment securities were $18 thousand and gross realized losses on sales of investment securities were $187 thousand. In 2021, gross realized gains on sales of investment securities were $3.2 million and gross realized losses on sales of investment securities were $187 thousand. In 2020, gross realized gains on sales of investment securities were $1.9 million and gross realized losses on sales of investment securities were $46 thousand. Proceeds from sales and calls of investment securities for 2022, 2021 and 2020 were $14.6 million, $201.0 million and $124.1 million, respectively. The carrying value of securities pledged as collateral for certain government deposits, securities sold under agreements to repurchase and certain lines of credit with correspondent banks at December 31, 2022 was $220.1 million and $261.0 million at December 31, 2021, which is well in excess of required amounts in order to operationally provide significant reserve amounts for new business. As of December 31, 2022 and December 31, 2021, there were no holdings of securities of any one issuer, other than the U.S. Government and U.S. agency securities, which exceeded ten percent of shareholders’ equity.

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- Definition The entire disclosure for investments in certain debt and equity securities. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 320 -URI https://asc.fasb.org/subtopic&trid=2209399 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 946 -SubTopic 320 -URI https://asc.fasb.org/subtopic&trid=2324412 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -URI https://asc.fasb.org/topic&trid=2196928 Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 940 -SubTopic 320 -URI https://asc.fasb.org/subtopic&trid=2176304 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher SEC -Name Regulation S-K (SK) -Number 229 -Section 1403 -Paragraph (b) + Details
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