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Investment Securities - (Tables)

6 Months Ended

Jun. 30, 2021

Investments, Debt and Equity Securities [Abstract]

Summary of Held-to-Maturity Investments

A summary of the amortized cost, fair value and allowance for credit losses related to securities held-to-maturity as of June 30, 2021 and December 31, 2020 is presented below.

Held-to-maturity:			Amortized Cost 1			Allowance for Credit Losses			Net Carrying Amount			Gross Unrealized						Fair Value
(in thousands)												Gains			(Losses)
June 30, 2021
Securities of U.S. government-sponsored enterprises:
MBS pass-through securities issued by FHLMC and FNMA			$	74,115		$	—		$	74,115		$	3,247		$	—		$	77,362
CMOs issued by FHLMC			38,641			—			38,641			1,142			(38)			39,745
CMOs issued by FNMA			6,274			—			6,274			265			—			6,539
SBA-backed securities			5,697			—			5,697			361			—			6,058
Debentures of government-sponsored agencies			43,731			—			43,731			115			—			43,846
Obligations of state and political subdivisions			580			—			580			8			—			588
Total held-to-maturity			$	169,038		$	—		$	169,038		$	5,138		$	(38)		$	174,138
December 31, 2020
Corporate bonds			$	—		$	—		$	—		$	—		$	—		$	—
Securities of U.S. government-sponsored enterprises:
MBS pass-through securities issued by FHLMC and FNMA			$	65,579		$	—		$	65,579		$	3,924		$	—		$	69,503
CMOs issued by FHLMC			27,201			—			27,201			1,441			—			28,642
CMOs issued by FNMA			8,042			—			8,042			363			—			8,405
SBA-backed securities			6,547			—			6,547			400			—			6,947
Obligations of state and political subdivisions			1,667			—			1,667			21			—			1,688
Total held-to-maturity			$	109,036		$	—		$	109,036		$	6,149		$	—		$	115,185
1 Amortized cost and fair values exclude accrued interest receivable of $550 thousand and $366 thousand at June 30, 2021 and December 31, 2020, respectively, which is included in interest receivable and other assets in the consolidated statements of condition.

Schedule of Bond Ratings for Held-to-Maturity Securities

The following table summarizes the amortized cost of our portfolio of held-to-maturity securities issued by states and political subdivisions by Moody's and/or Standard & Poor's bond ratings as of June 30, 2021.

			Obligations of state and political subdivisions
(in thousands)			June 30, 2021			December 31, 2020
AA			$	376		$	1,461
A			204			206
Total			$	580		$	1,667

Summary of Available-for-Sale Investments

A summary of the amortized cost, fair value and allowance for credit losses related to securities available-for-sale as of June 30, 2021 and December 31, 2020 is presented below.

Available-for-sale:			Amortized Cost 1			Gross Unrealized						Allowance for Credit Losses			Fair Value
(in thousands)						Gains			(Losses)
June 30, 2021
Securities of U.S. government-sponsored enterprises:
MBS pass-through securities issued by FHLMC and FNMA			$	57,653		$	1,867		$	—		$	—		$	59,520
CMOs issued by FHLMC			160,949			5,573			(436)			—			166,086
CMOs issued by FNMA			36,636			428			—			—			37,064
CMOs issued by GNMA			21,855			258			—			—			22,113
SBA-backed securities			27,938			1,568			(46)			—			29,460
Debentures of government- sponsored agencies			76,321			128			(1,738)			—			74,711
Obligations of state and political subdivisions			117,595			5,694			(65)			—			123,224
Corporate bonds			5,987			—			(202)			—			5,785
Total available-for-sale			$	504,934		$	15,516		$	(2,487)		$	—		$	517,963
December 31, 2020
Securities of U.S. government-sponsored enterprises:
MBS pass-through securities issued by FHLMC and FNMA			$	50,686		$	2,530		$	—		$	—		$	53,216
CMOs issued by FHLMC			143,267			7,925			(1)			—			151,191
CMOs issued by FNMA			16,450			580			—			—			17,030
CMOs issued by GNMA			6,863			351			—			—			7,214
SBA-backed securities			30,941			1,976			(55)			—			32,862
Debentures of government- sponsored agencies			19,944			266			(24)			—			20,186
Obligations of state and political subdivisions			104,887			5,765			—			—			110,652
Total available-for-sale			$	373,038		$	19,393		$	(80)		$	—		$	392,351
1 Amortized cost and fair value exclude accrued interest receivable of $2.4 million and $1.9 million June 30, 2021 and December 31, 2020, which is included in interest receivable and other assets in the consolidated statements of condition.

Investments Classified by Contractual Maturity Date

The amortized cost and fair value of investment debt securities by contractual maturity at June 30, 2021 and December 31, 2020 are shown below. Expected maturities may differ from contractual maturities if the issuers of the securities have the right to call or prepay obligations with or without call or prepayment penalties.

			June 30, 2021																		December 31, 2020
			Held-to-Maturity									Available-for-Sale									Held-to-Maturity									Available-for-Sale
(in thousands)			Amortized Cost			Fair Value						Amortized Cost			Fair Value						Amortized Cost			Fair Value						Amortized Cost			Fair Value
Within one year			$	245		$	246					$	14,263		$	14,403					$	246		$	250					$	11,530		$	11,687
After one but within five years			20,203			21,184						53,194			55,835						7,550			7,961						59,028			62,397
After five years through ten years			58,465			60,963						183,706			189,492						52,113			55,872						144,908			154,089
After ten years			90,125			91,745						253,771			258,233						49,127			51,102						157,572			164,178
Total			$	169,038		$	174,138					$	504,934		$	517,963					$	109,036		$	115,185					$	373,038		$	392,351

Sale of Investment Securities and Gross Gains and Losses

Sales of investment securities and gross gains and losses are shown in the following table:

			Three months ended									Six months ended
(in thousands)			June 30, 2021			June 30, 2020						June 30, 2021			June 30, 2020
Available-for-sale:
Sales proceeds			$	—		$	6,314					$	—		$	33,756
Gross realized gains			—			116						—			916
Gross realized losses			—			(1)						—			(1)

Schedule of Financial Instruments Owned and Pledged as Collateral

Pledged investment securities are shown in the following table:

(in thousands)			June 30, 2021			December 31, 2020
Pledged to the State of California:
Secure public deposits in compliance with the Local Agency Security Program			$	145,128		$	131,051
Collateral for trust deposits			742			751
Total investment securities pledged to the State of California			145,870			131,802
Collateral for Wealth Management and Trust Services checking account			624			629
Total pledged investment securities			$	146,494		$	132,431

Schedule of Unrealized Loss on Investments

There were 23 and 10 securities in unrealized loss positions at June 30, 2021 and December 31, 2020, respectively. Those securities are summarized and classified according to the duration of the loss period in the tables below:

June 30, 2021			< 12 continuous months									≥ 12 continuous months									Total securities  in a loss position
(in thousands)			Fair value			Unrealized loss						Fair value			Unrealized loss						Fair value			Unrealized loss
Held-to-maturity:
CMOs issued by FHLMC			$	4,372		$	(38)					$	—		$	—					$	4,372		$	(38)
Total held-to-maturity			4,372			(38)						—			—						4,372			(38)
Available-for-sale:
MBS pass-through securities issued by FHLMC and FNMA			—			—						—			—						—			—
SBA-backed securities			—			—						1,417			(46)						1,417			(46)
CMOs issued by FNMA			—			—						—			—						—			—
CMOs issued by FHLMC			33,740			(436)						—			—						33,740			(436)
Debentures of government- sponsored agencies			63,594			(1,738)						—			—						63,594			(1,738)
Obligations of state and political subdivisions			2,550			(65)						—			—						2,550			(65)
Corporate bonds			5,785			(202)						—			—						5,785			(202)
Total available-for-sale			105,669			(2,441)						1,417			(46)						107,086			(2,487)
Total temporarily impaired securities			$	110,041		$	(2,479)					$	1,417		$	(46)					$	111,458		$	(2,525)

December 31, 2020			< 12 continuous months									≥ 12 continuous months									Total securities  in a loss position
(in thousands)			Fair value			Unrealized loss						Fair value			Unrealized loss						Fair value			Unrealized loss
Available-for-sale:
SBA-backed securities			$	—		$	—					$	1,790		$	(55)					$	1,790		$	(55)
CMOs issued by FHLMC			5,975			(1)						—			—						5,975			(1)
Debentures of government- sponsored agencies			3,943			(24)						—			—						3,943			(24)
Total available-for-sale			9,918			(25)						1,790			(55)						11,708			(80)
Total temporarily impaired securities			$	9,918		$	(25)					$	1,790		$	(55)					$	11,708		$	(80)

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