Our investment securities portfolio consists of U.S. Treasury securities, obligations of state and political subdivisions, U.S. federal government agencies, such as the Government National Mortgage Association ("GNMA") and Small Business Administration ("SBA"), and U.S. government-sponsored enterprises ("GSEs"), such as the Federal National Mortgage Association ("FNMA"), Federal Home Loan Mortgage Corporation ("FHLMC"), Federal Farm Credit Banks Funding Corporation and FHLB, and U.S. Corporations. We also invest in residential and commercial mortgage-backed securities (“MBS”/"CMBS") and collateralized mortgage obligations (“CMOs”) issued or guaranteed by the GSEs, as reflected in the following table.


Held-to-maturity:	Amortized Cost 1		Allowance for Credit Losses		Net Carrying Amount		Gross Unrealized				Fair Value
(in thousands)							Gains		(Losses)
March 31, 2024
Securities of U.S. government-sponsored enterprises:
MBS pass-through securities issued by FHLMC, FNMA and GNMA	$	300,976	$	—	$	300,976	$	—	$	(48,474)	$	252,502
CMOs issued by FHLMC	224,676		—		224,676		—		(26,902)		197,774
CMOs issued by FNMA	98,951		—		98,951		—		(6,009)		92,942
CMOs issued by GNMA	50,695		—		50,695		—		(5,436)		45,259
SBA-backed securities	1,652		—		1,652		—		(95)		1,557
Debentures of government-sponsored agencies	146,202		—		146,202		—		(22,942)		123,260
Obligations of state and political subdivisions	61,916		—		61,916		4		(8,022)		53,898
Corporate bonds	30,000		—		30,000		—		(1,283)		28,717
Total held-to-maturity	$	915,068	$	—	$	915,068	$	4	$	(119,163)	$	795,909
December 31, 2023

Securities of U.S. government-sponsored enterprises:
MBS pass-through securities issued by FHLMC, FNMA and GNMA	$	306,261	$	—	$	306,261	$	—	$	(44,396)	$	261,865
CMOs issued by FHLMC	226,416		—		226,416		28		(24,869)		201,575
CMOs issued by FNMA	101,502		—		101,502		—		(4,779)		96,723
CMOs issued by GNMA	51,006		—		51,006		—		(5,235)		45,771
SBA-backed securities	1,853		—		1,853		—		(90)		1,763
Debentures of government-sponsored agencies	146,126		—		146,126		—		(21,994)		124,132
Obligations of state and political subdivisions	62,034		—		62,034		47		(7,884)		54,197
Corporate bonds	30,000		—		30,000		—		(1,196)		28,804
Total held-to-maturity	$	925,198	$	—	$	925,198	$	75	$	(110,443)	$	814,830
1 Amortized cost and fair values exclude accrued interest receivable of $2.5 million and $3.6 million at March 31, 2024 and December 31, 2023, respectively, which is included in interest receivable and other assets in the consolidated statements of condition.

Management measures expected credit losses on held-to-maturity securities collectively 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 regard to MBSs and CMOs issued or guaranteed by the GSEs, and SBA-backed securities, we expect to receive all the contractual principal and interest on these securities as such securities are backed by the full faith and credit of and/or guaranteed by the U.S. government. Accordingly, no allowance for credit losses has been recorded for these securities. With regard to securities issued by states and political subdivisions and corporate bonds, management considers: (i) issuer and/or guarantor credit ratings, (ii) historical probability of default and loss given default rates for given bond ratings and remaining maturity, (iii) whether issuers continue to make timely principal and interest payments under the contractual terms of the securities, (iv) internal credit review of the financial information, and (v) whether or not such securities have credit enhancements such as guarantees, contain a defeasance clause, or are pre-refunded by the issuers. Based on the comprehensive analysis, no credit losses are expected.


Available-for-sale:	Amortized Cost 1		Gross Unrealized				Allowance for Credit Losses		Fair Value
(in thousands)			Gains		(Losses)
March 31, 2024
Securities of U.S. government-sponsored enterprises:
MBS pass-through securities issued by FHLMC, FNMA and GNMA	$	79,460	$	2	$	(10,073)	$	—	$	69,389
CMOs issued by FHLMC	261,797		—		(26,837)		—		234,960
CMOs issued by FNMA	23,099		—		(2,835)		—		20,264
CMOs issued by GNMA	19,486		—		(3,191)		—		16,295
SBA-backed securities	18,805		—		(1,657)		—		17,148
Debentures of government- sponsored agencies	73,906		—		(7,218)		—		66,688

U.S. Treasury securities	11,928		—		(1,394)		—		10,534
Obligations of state and political subdivisions	101,911		—		(11,568)		—		90,343
Corporate bonds	11,992		—		(1,248)		—		10,744

Total available-for-sale	$	602,384	$	2	$	(66,021)	$	—	$	536,365
December 31, 2023
Securities of U.S. government-sponsored enterprises:
MBS pass-through securities issued by FHLMC, FNMA and GNMA	$	81,937	$	2	$	(9,516)	$	—	$	72,423
CMOs issued by FHLMC	266,407		—		(24,758)		—		241,649
CMOs issued by FNMA	23,987		—		(2,715)		—		21,272
CMOs issued by GNMA	20,006		—		(2,878)		—		17,128
SBA-backed securities	21,126		—		(1,655)		—		19,471
Debentures of government- sponsored agencies	73,899		—		(7,037)		—		66,862

U.S. Treasury securities	11,923		—		(1,300)				10,623
Obligations of state and political subdivisions	102,202		1		(10,321)		—		91,882
Corporate bonds	11,992		—		(1,274)		—		10,718

Total available-for-sale	$	613,479	$	3	$	(61,454)	$	—	$	552,028
1 Amortized cost and fair value exclude accrued interest receivable of $2.3 million and $2.3 million at March 31, 2024 and December 31, 2023, respectively, which is included in interest receivable and other assets in the consolidated statements of condition.


	March 31, 2024								December 31, 2023
	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	$	15,000	$	14,615	$	4,181	$	4,076	$	—	$	—	$	101	$	100
After one but within five years	72,200		69,109		249,923		228,662		87,887		84,541		226,669		208,444
After five years through ten years	304,877		259,599		62,426		54,421		304,976		261,654		95,552		85,447
After ten years	522,991		452,586		285,854		249,206		532,335		468,635		291,157		258,037
Total	$	915,068	$	795,909	$	602,384	$	536,365	$	925,198	$	814,830	$	613,479	$	552,028


(in thousands)	March 31, 2024		December 31, 2023
Pledged to the State of California:
Secure public deposits in compliance with the Local Agency Security Program	$	282,826	$	287,436
Collateral for trust deposits	659		666
Collateral for Wealth Management and Trust Services checking account	557		562
Total investment securities pledged to the State of California	284,042		288,664
Bankruptcy trustee deposits pledged with Federal Reserve Bank	1,003		1,151
Pledged to FHLB Securities-Backed Credit Program	296,614		383,484
Pledged to the Federal Reserve "BTFP"	—		265,660
Pledged to the Federal Reserve Discount Window	345,896		—
Total pledged investment securities	$	927,555	$	938,959


March 31, 2024	< 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:
MBS pass-through securities issued by FHLMC, FNMA and GNMA	$	—	$	—	$	252,501	$	(48,474)	$	252,501	$	(48,474)
CMOs issued by FHLMC	12,455		(68)		185,319		(26,834)		197,774		(26,902)
CMOs issued by FNMA	40,962		(1,054)		51,980		(4,955)		92,942		(6,009)
CMOs issued by GNMA	10,808		(350)		34,452		(5,086)		45,260		(5,436)
SBA-backed securities	—		—		1,556		(95)		1,556		(95)
Debentures of government-sponsored agencies	—		—		123,260		(22,942)		123,260		(22,942)
Obligations of state and political subdivisions	6,589		(46)		44,242		(7,976)		50,831		(8,022)
Corporate bonds	—		—		28,717		(1,283)		28,717		(1,283)
Total held-to-maturity	70,814		(1,518)		722,027		(117,645)		792,841		(119,163)
Available-for-sale:
MBS pass-through securities issued by FHLMC, FNMA and GNMA	3		—		69,152		(10,073)		69,155		(10,073)
CMOs issued by FHLMC	958		(4)		234,002		(26,833)		234,960		(26,837)
CMOs issued by FNMA	—		—		20,264		(2,835)		20,264		(2,835)
CMOs issued by GNMA	—		—		16,295		(3,191)		16,295		(3,191)
SBA-backed securities	—		—		17,148		(1,657)		17,148		(1,657)
Debentures of government- sponsored agencies	—		—		66,688		(7,218)		66,688		(7,218)
U.S. Treasury securities	—		—		10,534		(1,394)		10,534		(1,394)

Obligations of state and political subdivisions	557		(2)		89,786		(11,566)		90,343		(11,568)
Corporate bonds	—		—		10,744		(1,248)		10,744		(1,248)

Total available-for-sale	1,518		(6)		534,613		(66,015)		536,131		(66,021)
Total securities at loss position	$	72,332	$	(1,524)	$	1,256,640	$	(183,660)	$	1,328,972	$	(185,184)


December 31, 2023	< 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:
MBS pass-through securities issued by FHLMC, FNMA and GNMA	$	—	$	—	$	261,865	$	(44,396)	$	261,865	$	(44,396)
CMOs issued by FHLMC	8,662		(21)		188,657		(24,848)		197,319		(24,869)
CMOs issued by FNMA	42,474		(411)		54,249		(4,368)		96,723		(4,779)
CMOs issued by GNMA	10,988		(244)		34,783		(4,991)		45,771		(5,235)
SBA-backed securities	—		—		1,763		(90)		1,763		(90)
Debentures of government- sponsored agencies	—		—		124,132		(21,994)		124,132		(21,994)
Obligations of state and political subdivisions	—		—		44,437		(7,884)		44,437		(7,884)
Corporate Bonds	—		—		28,804		(1,196)		28,804		(1,196)
Total held-to-maturity	62,124		(676)		738,690		(109,767)		800,814		(110,443)
Available-for-sale:
MBS pass-through securities issued by FHLMC, FNMA and GNMA	—		—		72,146		(9,516)		72,146		(9,516)
CMOs issued by FHLMC	1,235		(7)		240,414		(24,751)		241,649		(24,758)
CMOs issued by FNMA	—		—		21,272		(2,715)		21,272		(2,715)
CMOs issued by GNMA	—		—		17,128		(2,878)		17,128		(2,878)
SBA-backed securities	—		—		19,471		(1,655)		19,471		(1,655)
Debentures of government- sponsored agencies	—		—		66,862		(7,037)		66,862		(7,037)
U.S. Treasury securities	—		—		10,623		(1,300)		10,623		(1,300)
Obligations of state and political subdivisions	666		(1)		90,655		(10,320)		91,321		(10,321)
Corporate Bonds	—		—		10,718		(1,274)		10,718		(1,274)


Total available-for-sale	1,901		(8)		549,289		(61,446)		551,190		(61,454)
Total securities at loss position	$	64,025	$	(684)	$	1,287,979	$	(171,213)	$	1,352,004	$	(171,897)

Securities issued by government-sponsored agencies, such as FNMA and FHLMC, usually have implicit credit support from the U.S. federal government. However, since 2008, FNMA and FHLMC have been under government conservatorship and, therefore, contractual cash flows for these investments carry explicit guarantees by the U.S. federal government while FNMA and FHLMC remain under conservatorship. Securities issued by the SBA and GNMA have explicit credit guarantees by the U.S. federal government, which protects us from credit losses on the contractual cash flows of the securities.

No allowances for credit losses have been recognized on available-for-sale securities in an unrealized loss position, as management does not believe any of the securities are impaired due to credit risk factors at either March 31, 2024 or December 31, 2023. In addition, for any available-for-sale securities in an unrealized loss position at March 31, 2024 and December 31, 2023, the Bank assessed whether it intended to sell the securities, or if it was more likely than not that it would be required to sell the securities before recovery of its amortized cost basis, which would require a write-down to fair value through net income. Because the Bank did not intend to sell those securities that were in an unrealized loss position, and it was not more-likely-than-not that the Bank would be required to sell the securities before recovery of their amortized cost bases, the Bank determined that no write-down was necessary as of the reporting date.

As a member of the FHLB, we are required to maintain a minimum investment in FHLB capital stock as determined by the Board of Directors of the FHLB. The minimum investment requirements can increase in the event we increase our total asset size or borrowings with the FHLB. Shares cannot be purchased or sold except between the FHLB and its members at the $100 per share par value. We held $16.7 million of FHLB stock included in other assets on the consolidated statements of condition at both March 31, 2024 and December 31, 2023. The carrying amounts of these investments are reasonable estimates of fair value because the securities are restricted to member banks and they do not have a readily determinable market value. Based on our analysis of FHLB's financial condition and certain qualitative factors, we determined that the FHLB stock was not impaired at March 31, 2024 and December 31, 2023. On April 25, 2024, FHLB announced a cash dividend for the first quarter of 2024 at an annualized dividend rate of 8.25% to be distributed in mid-May 2024. Cash dividends paid on FHLB capital stock are recorded as non-interest income.

We invest in low-income housing tax credit funds as a limited partner, which totaled $1.9 million and $2.0 million recorded in other assets as of March 31, 2024 and December 31, 2023, respectively. In the first three months of 2024, we recognized $133 thousand of low-income housing tax credits and other tax benefits, offset by $111 thousand of amortization expense of low-income housing tax credit investment, as a component of income tax expense. As of March 31, 2024, our unfunded commitments for these low-income housing tax credit funds totaled $343 thousand. We did not recognize any impairment losses on these low-income housing tax credit investments during the first three months of 2024 or 2023, as the value of the future tax benefits exceeds the carrying value of the investments.