
	June 30, 2020
	Amortized Cost		Gross Unrealized Gain		Gross Unrealized Loss		Estimated Fair Value
	(Dollars in thousands)
Investment securities available-for-sale:
U.S. Treasury	$	30,170	$	2,700	$	—	$	32,870
Agency	315,927		24,419		(356)		339,990
Corporate	274,076		1,698		(1,775)		273,999
Municipal bonds	439,772		21,629		(66)		461,335
Collateralized mortgage obligations	380,527		4,260		(48)		384,739
Mortgage-backed securities	814,012		29,375		(254)		843,133
Total investment securities available-for-sale	2,254,484		84,081		(2,499)		2,336,066
Investment securities held-to-maturity:
Mortgage-backed securities	30,892		1,622		—		32,514
Other	1,665		—		—		1,665
Total investment securities held-to-maturity	32,557		1,622		—		34,179
Total investment securities	$	2,287,041	$	85,703	$	(2,499)	$	2,370,245


	December 31, 2019
	Amortized Cost		Gross Unrealized Gain		Gross Unrealized Loss		Estimated Fair Value
	(Dollars in thousands)
Investment securities available-for-sale:
U.S. Treasury	$	60,457	$	3,137	$	(39)	$	63,555
Agency	240,348		7,686		(1,676)		246,358
Corporate	149,150		2,217		(14)		151,353
Municipal bonds	384,032		13,450		(184)		397,298
Collateralized mortgage obligations	9,869		123		(8)		9,984
Mortgage-backed securities	494,404		7,603		(2,171)		499,836
Total investment securities available-for-sale	1,338,260		34,216		(4,092)		1,368,384
Investment securities held-to-maturity:
Mortgage-backed securities	36,114		922		—		37,036
Other	1,724		—		—		1,724
Total investment securities held-to-maturity	37,838		922		—		38,760
Total investment securities	$	1,376,098	$	35,138	$	(4,092)	$	1,407,144

Unrealized gains and losses on investment securities available-for-sale are recognized in stockholders’ equity as accumulated other comprehensive income or loss. At June 30, 2020, the Company had accumulated other comprehensive income of $81.6 million, or $58.2 million net of tax, compared to an accumulated other comprehensive income of $30.1 million, or $21.5 million net of tax, at December 31, 2019.

The Company reviews individual securities classified as available-for-sale to determine whether a decline in fair value below the amortized cost basis is deemed credit related or due to other factors such as changes in interest rates and general market conditions. The Company recognizes credit losses in current period earnings when declines in the fair value of individual available-for-sale securities are below their amortized cost, and the decline in fair value is deemed to be credit related. Declines in fair value below amortized cost not deemed credit related are recorded net of tax in accumulated other comprehensive income. In the event the Company is required to sell or has the intent to sell an available-for-sale security that has experienced a decline in fair value below its amortized cost, the Company writes the amortized cost of the security down to fair value in the current period.

As of June 30, 2020, the Company has not recorded credit losses on certain available-for-sale securities that were in an unrealized loss position due to the high quality of the investments, with investment grade ratings, and many of them are issued by U.S. government agencies. Additionally, the Company continues to receive contractual principal and interest payments in a timely manner. The Company performed an assessment of these investments as of June 30, 2020, and does not believe the declines in fair value are credit related. There were no provision for credit losses recognized for the the six months ended June 30, 2020. There were no other than temporary impairment losses recognized for the six months ended June 30, 2019.

At June 30, 2020, there were no available-for-sale or held-to-maturity securities in nonaccrual status. All securities in the portfolio were current with their contractual principal and interest payments. At June 30, 2020 and December 31, 2019, there were no securities purchased with deterioration in credit quality since their origination. At June 30, 2020, there were no collateral dependent available-for-sale or held-to-maturity securities.


	June 30, 2020
	Less than 12 Months								12 Months or Longer							Total
	Number	Fair Value		Gross Unrealized Losses		Number	Fair Value		Gross Unrealized Losses		Number	Fair Value		Gross Unrealized Losses
	(Dollars in thousands)
Investment securities available-for-sale:
U.S. Treasury	—	$	—	$	—	—	$	—	$	—	—	$	—	$	—
Agency	1	12,361		(10)		9	11,687		(346)		10	24,048		(356)
Corporate	13	84,559		(1,775)		—	—		—		13	84,559		(1,775)
Municipal bonds	7	19,326		(66)		—	—		—		7	19,326		(66)
Collateralized mortgage obligations	3	26,593		(47)		1	522		(1)		4	27,115		(48)
Mortgage-backed securities.	11	93,393		(254)		—	—		—		11	93,393		(254)
Total investment securities available-for-sale	35	236,232		(2,152)		10	12,209		(347)		45	248,441		(2,499)


	December 31, 2019
	Less than 12 Months								12 Months or Longer							Total
	Number	Fair Value		Gross Unrealized Losses		Number	Fair Value		Gross Unrealized Losses		Number	Fair Value		Gross Unrealized Losses
	(Dollars in thousands)
Investment securities available-for-sale:
U.S. Treasury	1	$	10,194	$	(39)	—	$	—	$	—	1	$	10,194	$	(39)
Agency	13	102,874		(1,340)		9	13,514		(336)		22	116,388		(1,676)
Corporate	1	1,017		(14)		—	—		—		1	1,017		(14)
Municipal bonds	12	30,541		(184)		—	—		—		12	30,541		(184)
Collateralized mortgage obligations	—	—		—		1	603		(8)		1	603		(8)
Mortgage-backed securities	18	130,014		(1,681)		11	26,886		(490)		29	156,900		(2,171)
Total investment securities available-for-sale	45	274,640		(3,258)		21	41,003		(834)		66	315,643		(4,092)


	Due in One Year or Less						Due after One Year through Five Years						Due after Five Years through Ten Years						Due after Ten Years		Total
	Amortized Cost		Fair Value		Amortized Cost		Fair Value		Amortized Cost		Fair Value		Amortized Cost		Fair Value		Amortized Cost		Fair Value
	(Dollars in thousands)
Investment securities available-for-sale:
U.S. Treasury	$	—	$	—	$	20,147	$	21,577	$	10,023	$	11,293	$	—	$	—	$	30,170	$	32,870
Agency	1,000		1,013		40,577		43,830		203,033		218,452		71,317		76,695		315,927		339,990
Corporate	76,883		76,988		73,958		74,303		123,235		122,708		—		—		274,076		273,999
Municipal bonds	—		—		1,452		1,574		29,653		31,980		408,667		427,781		439,772		461,335
Collateralized mortgage obligations	—		—		—		—		52,686		53,250		327,841		331,489		380,527		384,739
Mortgage-backed securities	—		—		2,213		2,419		191,695		206,540		620,104		634,174		814,012		843,133
Total investment securities available-for-sale	77,883		78,001		138,347		143,703		610,325		644,223		1,427,929		1,470,139		2,254,484		2,336,066
Investment securities held-to-maturity:
Mortgage-backed securities	—		—		—		—		—		—		30,892		32,514		30,892		32,514
Other	—		—		—		—		—		—		1,665		1,665		1,665		1,665
Total investment securities held-to-maturity	—		—		—		—		—		—		32,557		34,179		32,557		34,179
Total investment securities	$	77,883	$	78,001	$	138,347	$	143,703	$	610,325	$	644,223	$	1,460,486	$	1,504,318	$	2,287,041	$	2,370,245

During the three months ended June 30, 2020, March 31, 2020 and June 30, 2019, the Company recognized gross gains on sales of available-for-sale securities in the amount of $1.3 million, $8.0 million and $406,000, respectively. During the three months ended June 30, 2020, March 31, 2020 and June 30, 2019, the Company recognized gross losses on sales of available-for-sale securities in the amount of $1.3 million, $204,000 and $194,000, respectively. The Company had net proceeds from the sales of available-for-sale securities of $191.1 million during the three months ended June 30, 2020, of which $6.5 million were receivables on unsettled security sales. The Company had net proceeds from the sales of available-for-sale securities of $155.3 million and $57.2 million during the three months ended March 31, 2020 and June 30, 2019.

sales of available-for-sale securities in the amount of $9.2 million and $1.4 million, respectively. During the six months ended June 30, 2020 and 2019, the Company recognized gross losses on the sales of available-for sale securities in the amount of $1.5 million and $809,000, respectively. The Company had net proceeds from the sales of available-for-sale securities of $346.4 million, of which $6.5 million were receivables on unsettled security sales, and $227.1 million during the six months ended June 30, 2020 and 2019, respectively.

At June 30, 2020, the Company had $17.3 million in FHLB stock, $51.8 million in Federal Reserve Bank of San Francisco (“FRB”) stock and $25.7 million in other stock, all carried at cost. During the three months ended June 30, 2020, March 31, 2020 and June 30, 2019, the FHLB repurchased $17.3 million, $10.3 million and $5.4 million, respectively, of the Company’s excess FHLB stock through its stock repurchase program.

The Company accounts for credit losses on debt securities in accordance with ASC 326, which requires the Company to record an ACL on held-to-maturity investment securities at the time of purchase or acquisition. The ACL for held-to-maturity investment securities represents the Company’s current estimate of expected credit losses that may be incurred over the life of the investment. An ACL on available-for-sale investment securities is recorded when the fair value of the investment is below its amortized cost and the decline in fair value has been deemed to be credit related through the Company’s qualitative assessment. Non-credit related declines in fair value of available-for-sale investment securities are not recorded through an ACL, but rather recorded as an adjustment to accumulated other comprehensive income, net of tax. The Company determines credit losses on both available-for-sale investment securities through the use of a discounted cash flow approach using the security’s effective interest rate. The ACL is measured as the amount by which an investment security’s amortized cost exceeds the net present value of expected future cash flows. However, the amount of credit losses for available-for-sale investment securities is limited to the amount of a security’s unrealized loss. The ACL is established through a charge to provision for credit losses in current period earnings.

The Company did not record an ACL for available-for-sale or held-to-maturity investment securities during the six months ended June 30, 2020. For available-for-sale securities where estimated fair value was below amortized cost, such declines were deemed non-credit related and recorded as an adjustment to accumulated other comprehensive income, net of tax. Non-credit related decline in fair value of available-for-sale investment securities can be attributed to changes in interest rates and other market related factors. The Company did not record an ACL for held-to maturity securities during the six months ended June 30, 2020, because the likelihood of non-repayment is remote.


	Vintage
	2020		2019		2018		2017		2016		Prior		Total
	(Dollars in thousands)
Investment securities available-for-sale:
U.S. Treasury
Aaa - Aa3	$	—	$	—	$	22,103	$	10,767	$	—	$	—	$	32,870


Agency
Aaa - Aa3	28,924		44,590		159,345		9,759		21,556		75,816		339,990


Corporate debt

A1 - A3	—		19,856		—		—		119,687		9,344		148,887
Baa1 - Baa3	19,652		41,571		5,100		18,131		8,857		31,801		125,112
Municipal bonds
Aaa - Aa3	67,718		264,432		32,497		50,889		15,176		30,623		461,335


Collateralized mortgage obligations
Aaa - Aa3	37,610		44,082		162,056		4,208		119,932		16,851		384,739


Mortgage-backed securities
Aaa - Aa3	164,071		217,705		49,247		220,385		94,794		96,931		843,133


Total investment securities available-for-sale	317,975		632,236		430,348		314,139		380,002		261,366		2,336,066
Investment securities held-to-maturity:
Mortgage-backed securities
Aaa - Aa3	—		—		9,538		7,487		5,356		8,511		30,892


Other


Baa1 - Baa3	—		—		663		—		—		1,002		1,665
Total investment securities held-to-maturity	—		—		10,201		7,487		5,356		9,513		32,557
Total investment securities	$	317,975	$	632,236	$	440,549	$	321,626	$	385,358	$	270,879	$	2,368,623