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Investment Securities | 9 Months Ended
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Sep. 30, 2021
Investments [Abstract] |
Investment Securities | (5.) INVESTMENT SECURITIES The amortized cost and fair value of investment securities are summarized below (in thousands):
|  | Amortized |  |  | Unrealized |  |  | Unrealized |  |  | Fair |
|  | Cost |  |  | Gains |  |  | Losses |  |  | Value |
September 30, 2021 |  |  |  |  |  |  |  |  |  |  |  |
Securities available for sale: |  |  |  |  |  |  |  |  |  |  |  |
U.S. Government agency and government sponsored enterprises |  | $ | 6,253 |  |  | $ | 278 |  |  | $ | — |  |  | $ | 6,531 |
Mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |
Federal National Mortgage Association |  |  | 575,861 |  |  |  | 8,847 |  |  |  | 4,973 |  |  |  | 579,735 |
Federal Home Loan Mortgage Corporation |  |  | 390,062 |  |  |  | 1,257 |  |  |  | 6,195 |  |  |  | 385,124 |
Government National Mortgage Association |  |  | 92,793 |  |  |  | 468 |  |  |  | 935 |  |  |  | 92,326 |
Collateralized mortgage obligations: |  |  |  |  |  |  |  |  |  |  |  |
Federal National Mortgage Association |  |  | 17,689 |  |  |  | 67 |  |  |  | 132 |  |  |  | 17,624 |
Federal Home Loan Mortgage Corporation |  |  | 16,318 |  |  |  | — |  |  |  | 128 |  |  |  | 16,190 |
Privately issued |  |  | — |  |  |  | 420 |  |  |  | — |  |  |  | 420 |
Total mortgage-backed securities |  |  | 1,092,723 |  |  |  | 11,059 |  |  |  | 12,363 |  |  |  | 1,091,419 |
Total available for sale securities |  | $ | 1,098,976 |  |  | $ | 11,337 |  |  | $ | 12,363 |  |  | $ | 1,097,950 |
Securities held to maturity: |  |  |  |  |  |  |  |  |  |  |  |
State and political subdivisions |  | $ | 116,812 |  |  | $ | 2,897 |  |  | $ | 196 |  |  | $ | 119,513 |
Mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |
Federal National Mortgage Association |  |  | 9,535 |  |  |  | 539 |  |  |  | — |  |  |  | 10,074 |
Federal Home Loan Mortgage Corporation |  |  | 8,835 |  |  |  | 203 |  |  |  | 132 |  |  |  | 8,906 |
Government National Mortgage Association |  |  | 29,172 |  |  |  | 1,009 |  |  |  | — |  |  |  | 30,181 |
Collateralized mortgage obligations: |  |  |  |  |  |  |  |  |  |  |  |
Federal National Mortgage Association |  |  | 21,668 |  |  |  | 644 |  |  |  | — |  |  |  | 22,312 |
Federal Home Loan Mortgage Corporation |  |  | 26,125 |  |  |  | 894 |  |  |  | — |  |  |  | 27,019 |
Government National Mortgage Association |  |  | 5,993 |  |  |  | 166 |  |  |  | — |  |  |  | 6,159 |
Total mortgage-backed securities |  |  | 101,328 |  |  |  | 3,455 |  |  |  | 132 |  |  |  | 104,651 |
Total held to maturity securities |  |  | 218,140 |  |  | $ | 6,352 |  |  | $ | 328 |  |  | $ | 224,164 |
Allowance for credit losses - securities |  |  | (5 | ) |  |  |  |  |  |  |  |  |
Total held to maturity securities, net |  | $ | 218,135 |  |  |  |  |  |  |  |  |  |
December 31, 2020 |  |  |  |  |  |  |  |  |  |  |  |
Securities available for sale: |  |  |  |  |  |  |  |  |  |  |  |
U.S. Government agency and government sponsored enterprises |  | $ | 6,239 |  |  | $ | 396 |  |  | $ | — |  |  | $ | 6,635 |
Mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |
Federal National Mortgage Association |  |  | 350,627 |  |  |  | 15,549 |  |  |  | 44 |  |  |  | 366,132 |
Federal Home Loan Mortgage Corporation |  |  | 225,645 |  |  |  | 3,155 |  |  |  | 24 |  |  |  | 228,776 |
Government National Mortgage Association |  |  | 22,107 |  |  |  | 830 |  |  |  | — |  |  |  | 22,937 |
Collateralized mortgage obligations: |  |  |  |  |  |  |  |  |  |  |  |
Federal National Mortgage Association |  |  | 3,047 |  |  |  | 97 |  |  |  | — |  |  |  | 3,144 |
Federal Home Loan Mortgage Corporation |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Privately issued |  |  | — |  |  |  | 435 |  |  |  | — |  |  |  | 435 |
Total mortgage-backed securities |  |  | 601,426 |  |  |  | 20,066 |  |  |  | 68 |  |  |  | 621,424 |
Total available for sale securities |  | $ | 607,665 |  |  | $ | 20,462 |  |  | $ | 68 |  |  | $ | 628,059 |
(5.) INVESTMENT SECURITIES (Continued)
|  | Amortized |  |  | Unrealized |  |  | Unrealized |  |  | Fair |
|  | Cost |  |  | Gains |  |  | Losses |  |  | Value |
December 31, 2020 (continued) |  |  |  |  |  |  |  |  |  |  |  |
Securities held to maturity: |  |  |  |  |  |  |  |  |  |  |  |
State and political subdivisions |  | $ | 144,506 |  |  | $ | 4,478 |  |  | $ | — |  |  | $ | 148,984 |
Mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |
Federal National Mortgage Association |  |  | 10,776 |  |  |  | 703 |  |  |  | — |  |  |  | 11,479 |
Federal Home Loan Mortgage Corporation |  |  | 5,858 |  |  |  | 382 |  |  |  | — |  |  |  | 6,240 |
Government National Mortgage Association |  |  | 37,084 |  |  |  | 1,578 |  |  |  | — |  |  |  | 38,662 |
Collateralized mortgage obligations: |  |  |  |  |  |  |  |  |  |  |  |
Federal National Mortgage Association |  |  | 29,988 |  |  |  | 1,075 |  |  |  | — |  |  |  | 31,063 |
Federal Home Loan Mortgage Corporation |  |  | 35,897 |  |  |  | 1,581 |  |  |  | — |  |  |  | 37,478 |
Government National Mortgage Association |  |  | 7,864 |  |  |  | 265 |  |  |  | — |  |  |  | 8,129 |
Total mortgage-backed securities |  |  | 127,467 |  |  |  | 5,584 |  |  |  | — |  |  |  | 133,051 |
Total held to maturity securities |  |  | 271,973 |  |  | $ | 10,062 |  |  | $ | — |  |  | $ | 282,035 |
Allowance for credit losses - securities |  |  | (7 | ) |  |  |  |  |  |  |  |  |
Total held to maturity securities, net |  | $ | 271,966 |  |  |  |  |  |  |  |  |  |
The Company elected to exclude accrued interest receivable (“AIR”) from the amortized cost basis of debt securities disclosed throughout this footnote. For available for sale (“AFS”) debt securities, AIR totaled $1.9 million and $1.2 million as of September 30, 2021 and December 31, 2020. For held to maturity (“HTM”) debt securities, AIR totaled $1.0 million and $905 thousand as of September 30, 2021 and December 31, 2020, respectively. AIR is included in other assets on the Company’s consolidated statements of financial condition. For the three months ended September 30, 2021 and 2020, credit loss expense (credit) for HTM investment securities was $(1) thousand and $0, respectively. For the nine months ended September 30, 2021 and 2020, credit loss expense (credit) for HTM investment securities was $(2) thousand and $(6) thousand, respectively. Investment securities with a total fair value of $861.2 million and $567.4 million at September 30, 2021 and December 31, 2020, respectively, were pledged as collateral to secure public deposits and for other purposes required or permitted by law. Sales of securities available for sale were as follows (in thousands):
|  | Three months ended September 30, |  |  | Nine months ended September 30, |
|  | 2021 |  |  | 2020 |  |  | 2021 |  |  | 2020 |
Proceeds from sales |  | $ | — |  |  | $ | 20,576 |  |  | $ | 51,891 |  |  | $ | 50,207 |
Gross realized gains |  |  | — |  |  |  | 554 |  |  |  | 251 |  |  |  | 1,170 |
Gross realized losses |  |  | — |  |  |  | — |  |  |  | 180 |  |  |  | 9 |
The scheduled maturities of securities available for sale and securities held to maturity at September 30, 2021 are shown below (in thousands). Actual expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations.
|  | Amortized |  |  | Fair |
|  | Cost |  |  | Value |
Debt securities available for sale: |  |  |  |  |  |
Due in one year or less |  | $ | 4,863 |  |  | $ | 4,891 |
Due from one to five years |  |  | 62,802 |  |  |  | 65,773 |
Due after five years through ten years |  |  | 175,663 |  |  |  | 180,702 |
Due after ten years |  |  | 855,648 |  |  |  | 846,584 |
Total available for sale securities |  | $ | 1,098,976 |  |  | $ | 1,097,950 |
Debt securities held to maturity: |  |  |  |  |  |
Due in one year or less |  | $ | 36,191 |  |  | $ | 36,543 |
Due from one to five years |  |  | 72,707 |  |  |  | 75,317 |
Due after five years through ten years |  |  | 20,848 |  |  |  | 21,233 |
Due after ten years |  |  | 88,394 |  |  |  | 91,071 |
Total held to maturity securities |  | $ | 218,140 |  |  | $ | 224,164 |
(5.) INVESTMENT SECURITIES (Continued) Unrealized losses on investment securities for which an allowance for credit losses has not been recorded and the fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, were as follows (in thousands):
|  | Less than 12 months |  |  | 12 months or longer |  |  | Total |
|  | Fair |  |  | Unrealized |  |  | Fair |  |  | Unrealized |  |  | Fair |  |  | Unrealized |
|  | Value |  |  | Losses |  |  | Value |  |  | Losses |  |  | Value |  |  | Losses |
September 30, 2021 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Securities available for sale: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Government agency and government sponsored enterprises |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Federal National Mortgage Association |  |  | 328,931 |  |  |  | 4,650 |  |  |  | 9,173 |  |  |  | 323 |  |  |  | 338,104 |  |  |  | 4,973 |
Federal Home Loan Mortgage Corporation |  |  | 335,977 |  |  |  | 5,977 |  |  |  | 7,676 |  |  |  | 218 |  |  |  | 343,653 |  |  |  | 6,195 |
Government National Mortgage Association |  |  | 79,351 |  |  |  | 935 |  |  |  | — |  |  |  | — |  |  |  | 79,351 |  |  |  | 935 |
Collateralized mortgage obligations: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Federal National Mortgage Association |  |  | 7,818 |  |  |  | 132 |  |  |  | — |  |  |  | — |  |  |  | 7,818 |  |  |  | 132 |
Federal Home Loan Mortgage Corporation |  |  | 16,190 |  |  |  | 128 |  |  |  | — |  |  |  | — |  |  |  | 16,190 |  |  |  | 128 |
Privately issued |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Total mortgage-backed securities |  |  | 768,267 |  |  |  | 11,822 |  |  |  | 16,849 |  |  |  | 541 |  |  |  | 785,116 |  |  |  | 12,363 |
Total available for sale securities |  |  | 768,267 |  |  |  | 11,822 |  |  |  | 16,849 |  |  |  | 541 |  |  |  | 785,116 |  |  |  | 12,363 |
Total temporarily impaired securities |  | $ | 768,267 |  |  | $ | 11,822 |  |  | $ | 16,849 |  |  | $ | 541 |  |  | $ | 785,116 |  |  | $ | 12,363 |
December 31, 2020 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Securities available for sale: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Government agencies and government sponsored enterprises |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Mortgage-backed securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Federal National Mortgage Association |  |  | 18,155 |  |  |  | 44 |  |  |  | — |  |  |  | — |  |  |  | 18,155 |  |  |  | 44 |
Federal Home Loan Mortgage Corporation |  |  | 10,932 |  |  |  | 24 |  |  |  | — |  |  |  | — |  |  |  | 10,932 |  |  |  | 24 |
Government National Mortgage Association |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Collateralized mortgage obligations: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Federal National Mortgage Association |  |  | — |  |  |  | — |  |  |  | 8 |  |  |  | — |  |  |  | 8 |  |  |  | — |
Federal Home Loan Mortgage Corporation |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Privately issued |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Total mortgage-backed securities |  |  | 29,087 |  |  |  | 68 |  |  |  | 8 |  |  |  | — |  |  |  | 29,095 |  |  |  | 68 |
Total available for sale securities |  |  | 29,087 |  |  |  | 68 |  |  |  | 8 |  |  |  | — |  |  |  | 29,095 |  |  |  | 68 |
Total temporarily impaired securities |  | $ | 29,087 |  |  | $ | 68 |  |  | $ | 8 |  |  | $ | — |  |  | $ | 29,095 |  |  | $ | 68 |
(5.) INVESTMENT SECURITIES (Continued) The total number of securities positions in the investment portfolio in an unrealized loss position at September 30, 2021 was 99 compared to eight at December 31, 2020. At September 30, 2021, the Company had positions in six investment securities with a fair value of $16.8 million and a total unrealized loss of $541 thousand dollars that has been in a continuous unrealized loss position for more than 12 months. At September 30, 2021, there were a total of 93 securities positions in the Company’s investment portfolio with a fair value of $768.3 million and a total unrealized loss of $11.8 million that had been in a continuous unrealized loss position for less than 12 months. At December 31, 2020, the Company had a position in one investment security with a fair value of eight thousand dollars and a total unrealized loss of less than one thousand dollars that had been in a continuous unrealized loss position for more than 12 months. At December 31, 2020, there were a total of seven securities positions in the Company’s investment portfolio with a fair value of $29.1 million and a total unrealized loss of $68 thousand that had been in a continuous unrealized loss position for less than 12 months. The unrealized loss on investment securities was predominantly caused by changes in market interest rates subsequent to purchase. The fair value of most of the investment securities in the Company’s portfolio fluctuates as market interest rates change. Securities Available for Sale As of September 30, 2021 and December 31, 2020, no allowance for credit losses has been recognized on available for sale securities in an unrealized loss position as management does not believe any of the securities were impaired due to reasons of credit quality. This is based upon our analysis of the underlying risk characteristics, including credit ratings, and other qualitative factors related to our available for sale securities and in consideration of our historical credit loss experience and internal forecasts. The issuers of these securities continue to make timely principal and interest payments under the contractual terms of the securities. Furthermore, management does not have the intent to sell any of the securities classified as available for sale in the table above and believes that it is more likely than not that we will not have to sell any such securities before a recovery of cost. The unrealized losses are due to increases in market interest rates over the yields available at the time the underlying securities were purchased. The fair value is expected to recover as the securities approach their maturity date or repricing date or if market yields for such investments decline. Securities Held to Maturity The Company’s HTM investment securities include debt securities that are issued by U.S. government agencies or U.S. government-sponsored enterprises. These securities carry the explicit and/or implicit guarantee of the U.S. government, are widely recognized as “risk free,” and have a long history of zero credit loss. In addition, the Company’s HTM investment securities include debt securities that are issued by state and local government agencies, or municipal bonds. The Company monitors the credit quality of our municipal bonds through the use of a credit rating agency or by ratings that are derived by an internal scoring model. The scoring methodology for the internally derived ratings is based on a series of financial ratios for the municipality being reviewed as compared to typical industry figures. This information is used to determine the financial strengths and weaknesses of the municipality, which is indicated with a numeric rating. This number is then converted into a letter rating to better match the system used by the credit rating agencies. As of September 30, 2021, $111.0 million of our municipal bonds were rated as an equivalent to Standard & Poor’s A/AA/AAA, with $5.8 million internally rated to be the equivalent of Standard & Poor’s A/AA/AAA rating. Additionally, no municipal bonds were rated below investment grade. As of December 31, 2020, $135.7 million of our municipal bonds were rated as an equivalent to Standard & Poor’s A/AA/AAA, with $8.5 million internally rated to be the equivalent of Standard & Poor’s A/AA/AAA rating. Additionally, one municipal bond was rated below investment grade, with a BB+ Standard & Poor’s equivalent rating. The below investment grade bond represented exposure of $279 thousand, or 0.19% of the municipal bond portfolio and had been closely monitored for repayment. As of September 30, 2021 and December 31, 2020, the Company had no past due or nonaccrual held to maturity investment securities.

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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 http://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 http://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 http://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 http://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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