AFS Securities

12 Months Ended

Dec. 31, 2023

Investments, Debt and Equity Securities [Abstract]

The amortized cost and fair value of AFS securities, with gross unrealized gains and losses, are as follows as of December 31:


	2023
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
U.S. Treasury	$	231,218	$	—	$	16,417	$	214,801
States and political subdivisions	94,837		1,032		2,993		92,876
Auction rate money market preferred	3,200		—		269		2,931
Mortgage-backed securities	35,321		—		2,506		32,815
Collateralized mortgage obligations	187,248		—		9,473		177,775
Corporate	8,150		—		1,200		6,950
Total	$	559,974	$	1,032	$	32,858	$	528,148


	2022
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
U.S. Treasury	$	231,622	$	—	$	22,921	$	208,701
States and political subdivisions	122,023		392		4,903		117,512
Auction rate money market preferred	3,200		—		858		2,342
Mortgage-backed securities	42,309		—		3,239		39,070
Collateralized mortgage obligations	218,301		—		12,573		205,728
Corporate	8,150		—		1,022		7,128
Total	$	625,605	$	392	$	45,516	$	580,481

The amortized cost and fair value of AFS securities by contractual maturity at December 31, 2023 are as follows:


	Maturing								Securities with Variable Monthly Payments or Noncontractual Maturities
	Due in One Year or Less		After One Year But Within Five Years		After Five Years But Within Ten Years		After Ten Years				Total
U.S. Treasury	$	—	$	231,218	$	—	$	—	$	—	$	231,218
States and political subdivisions	15,461		28,082		20,003		31,291		—		94,837
Auction rate money market preferred	—		—		—		—		3,200		3,200
Mortgage-backed securities	—		—		—		—		35,321		35,321
Collateralized mortgage obligations	—		—		—		—		187,248		187,248
Corporate	—		—		8,150		—		—		8,150
Total amortized cost	$	15,461	$	259,300	$	28,153	$	31,291	$	225,769	$	559,974
Fair value	$	15,907	$	242,998	$	26,400	$	29,322	$	213,521	$	528,148

Expected maturities for government sponsored enterprises and states and political subdivisions may differ from contractual maturities because issuers may have the right to call or prepay obligations.

As the auction rate money market preferred investments have continual call dates, they are not reported by a specific maturity group. Because of their variable monthly payments, mortgage-backed securities and collateralized mortgage obligations are not reported by a specific maturity group. Approximately $143,000 of the amortized cost of the collateralized mortgage portfolio consist of agency commercial mortgage-backed securities with defined maturity dates of less than ten years.

A summary of the sales activity of AFS securities during the years ended December 31 is displayed in the following table.


	2023		2022		2021
Proceeds from sales of AFS securities	$	18,089	$	—	$	—
Realized gains (losses)	$	67	$	—	$	—
Applicable income tax expense (benefit)	$	14	$	—	$	—

The information on the following tables pertains to AFS securities with gross unrealized losses at December 31, 2023 and 2022 aggregated by investment category and length of time that individual securities have been in a continuous loss position.


	December 31, 2023
	Less Than Twelve Months				Twelve Months or More
	Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Total Unrealized Losses
U.S. Treasury	$	—	$	—	$	16,417	$	214,801	$	16,417
States and political subdivisions	42		7,172		2,951		37,011		2,993
Auction rate money market preferred	—		—		269		2,931		269
Mortgage-backed securities	1		10		2,505		32,805		2,506
Collateralized mortgage obligations	116		4,554		9,357		173,221		9,473
Corporate	—		—		1,200		6,950		1,200
Total	$	159	$	11,736	$	32,699	$	467,719	$	32,858
Number of securities in an unrealized loss position:			22				186		208


	December 31, 2022
	Less Than Twelve Months				Twelve Months or More
	Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Total Unrealized Losses
U.S. Treasury	$	1,388	$	18,331	$	21,533	$	190,370	$	22,921
States and political subdivisions	2,389		48,083		2,514		40,667		4,903
Auction rate money market preferred	—		—		858		2,342		858
Mortgage-backed securities	3,239		39,070		—		—		3,239
Collateralized mortgage obligations	12,408		201,317		165		4,411		12,573
Corporate	—		—		1,022		7,128		1,022
Total	$	19,424	$	306,801	$	26,092	$	244,918	$	45,516
Number of securities in an unrealized loss position:			178				266		444

The unrealized loss on our AFS securities portfolio resulted from the increase in short-term and intermediate-term interest rates.

As of December 31, 2023, no allowance for credit losses has been recognized on AFS securities in an unrealized loss position, as management does not believe any of the securities are impaired due to reasons of credit quality. This is based on our analysis of the underlying risk characteristics, including credit ratings, and other qualitative factors related to our AFS securities and 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 AFS in the table above, and believes 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 respective maturity date or repricing date, or if the market yields for such investments decline.