Investment Securities

12 Months Ended

Dec. 31, 2022

Investments, Debt and Equity Securities [Abstract]

A summary of the available-for-sale and held-to-maturity investment securities portfolios presenting carrying amounts and gross unrealized gains and losses as of December 31, 2022 and 2021 is as follows:


	December 31, 2022								December 31, 2021
(In thousands)	Amortized Cost		Gross unrealized gains		Gross unrealized losses		Fair Value		Amortized Cost		Gross unrealized gains		Gross unrealized losses		Fair Value
Available-for-sale securities
U.S. Treasury	$	14,943	$	5	$	—	$	14,948	$	—	$	—	$	—	$	—
U.S. government agencies	80,000		36		(5,814)		74,222		50,158		2,349		—		52,507
Municipal	173,861		230		(5,436)		168,655		161,618		4,193		(217)		165,594
Corporate notes:
Financial issuers	93,994		—		(9,291)		84,703		96,878		418		(2,599)		94,697
Other	1,000		2		—		1,002		1,000		7		—		1,007
Mortgage-backed: (1)
Mortgage-backed securities	3,308,494		238		(488,795)		2,819,937		1,901,005		32,830		(25,854)		1,907,981
Collateralized mortgage obligations	97,342		—		(17,792)		79,550		105,710		297		—		106,007
Total available-for-sale securities	$	3,769,634	$	511	$	(527,128)	$	3,243,017	$	2,316,369	$	40,094	$	(28,670)	$	2,327,793
Held-to-maturity securities
U.S. government agencies	$	339,614	$	—	$	(75,293)	$	264,321	$	180,192	$	201	$	(3,314)	$	177,079
Municipal	179,027		477		(4,066)		175,438		187,486		9,544		(223)		196,807
Mortgage-backed: (1)
Mortgage-backed securities	2,900,031		—		(583,682)		2,316,349		2,530,730		864		(47,622)		2,483,972
Collateralized mortgage obligations	164,151		—		(23,322)		140,829		—		—		—		—
Corporate notes	58,232		—		(5,348)		52,884		43,955		—		(1,119)		42,836
Total held-to-maturity securities	$	3,641,055	$	477	$	(691,711)	$	2,949,821	$	2,942,363	$	10,609	$	(52,278)	$	2,900,694
Less: Allowance for credit losses	(488)								(78)
Held-to-maturity securities, net of allowance for credit losses	$	3,640,567							$	2,942,285
Equity securities with readily determinable fair value	$	115,552	$	2,935	$	(8,122)	$	110,365	$	86,989	$	5,354	$	(1,832)	$	90,511

(1)Consisting entirely of residential mortgage-backed securities, none of which are subprime.

Equity securities without readily determinable fair values totaled $43.8 million as of December 31, 2022 and $37.5 million as of December 31, 2021. Equity securities without readily determinable fair values are included as part of accrued interest receivable and other assets in the Company’s Consolidated Statements of Condition. The Company monitors its equity investments without readily determinable fair values to identify potential transactions that may indicate an observable price change in orderly transactions for the identical or a similar investment of the same issuer, requiring adjustment to its carrying amount. The Company recorded no upward and no downward adjustments related to such observable price changes in 2022 or 2021. The Company conducts a quarterly assessment of its equity securities without readily determinable fair values to determine whether impairment exists in such equity securities, considering, among other factors, the nature of the securities, financial condition of the issuer and expected future cash flows. During the years ended December 31, 2022 and December 31, 2021, the Company recorded $12.2 million and $2.4 million, respectively, of impairment of equity securities without readily determinable fair values.

The following tables present the portion of the Company’s available-for-sale investment securities portfolios which had gross unrealized losses, reflecting the length of time that individual securities have been in a continuous unrealized loss position at December 31, 2022 and 2021, respectively:


As of December 31, 2022	Continuous unrealized losses existing for less than 12 months				Continuous unrealized losses existing for greater than 12 months				Total
(In thousands)	Fair value		Unrealized losses		Fair value		Unrealized losses		Fair value		Unrealized losses
Available-for-sale securities
U.S. Treasury	$	—	$	—	$	—	$	—	$	—	$	—
U.S. government agencies	36,750		(3,250)		7,436		(2,564)		44,186		(5,814)
Municipal	88,433		(1,997)		41,642		(3,439)		130,075		(5,436)
Corporate notes:
Financial issuers	14,420		(580)		70,283		(8,711)		84,703		(9,291)
Other	—		—		—		—		—		—
Mortgage-backed: (1)
Mortgage-backed securities	1,185,885		(99,494)		1,578,200		(389,301)		2,764,085		(488,795)
Collateralized mortgage obligations	2,690		(190)		76,860		(17,602)		79,550		(17,792)

Total available-for-sale securities	$	1,328,178	$	(105,511)	$	1,774,421	$	(421,617)	$	3,102,599	$	(527,128)

(1)Consisting entirely of residential mortgage-backed securities, none of which are subprime.


As of December 31, 2021	Continuous unrealized losses existing for less than 12 months				Continuous unrealized losses existing for greater than 12 months				Total
(In thousands)	Fair value		Unrealized losses		Fair value		Unrealized losses		Fair value		Unrealized losses
Available-for-sale securities
U.S. Treasury	$	—	$	—	$	—	$	—	$	—	$	—
U.S. government agencies	—		—		—		—		—		—
Municipal	47,726		(200)		850		(17)		48,576		(217)
Corporate notes:
Financial issuers	23,855		(1,145)		45,539		(1,454)		69,394		(2,599)
Other	—		—		—		—		—		—
Mortgage-backed: (1)
Mortgage-backed securities	742,743		(16,571)		221,350		(9,283)		964,093		(25,854)
Collateralized mortgage obligations	—		—		—		—		—		—

Total available-for-sale securities	$	814,324	$	(17,916)	$	267,739	$	(10,754)	$	1,082,063	$	(28,670)

(1)Consisting entirely of residential mortgage-backed securities, none of which are subprime.

The Company conducts a regular assessment of its investment securities to determine whether securities are experiencing credit losses. Factors for consideration include the nature of the securities, credit ratings or financial condition of the issuer, the extent of the unrealized loss, expected cash flows, market conditions and the Company’s ability to hold the securities through the anticipated recovery period.

The Company does not consider available-for-sale securities with unrealized losses at December 31, 2022 to be experiencing credit losses and recognized no resulting allowance for credit losses for such individually assessed credit losses. The Company does not intend to sell these investments and it is more likely than not that the Company will not be required to sell these investments before recovery of the amortized cost bases, which may be the maturity dates of the securities. The unrealized losses within each category have occurred as a result of changes in interest rates, market spreads and market conditions subsequent to purchase. Available-for-sale securities with continuous unrealized losses existing for more than twelve months at December 31, 2022 were primarily mortgage-backed securities with unrealized losses due to increased market rates during such period.

See Note (5) “Allowance for Credit Losses” for further discussion regarding any credit losses associated with held-to-maturity securities at December 31, 2022.

The following table provides information as to the amount of gross gains and losses, adjustments and impairment on investment securities recognized in earnings and proceeds received through the sale or call of investment securities:


	Years Ended December 31,
(In thousands)	2022		2021		2020
Realized gains on investment securities	$	461	$	1,252	$	751
Realized losses on investment securities	(22)		(173)		(530)
Net realized gains on investment securities	439		1,079		221

Unrealized gains on equity securities with readily determinable fair value	1,154		2,688		4,265
Unrealized losses on equity securities with readily determinable fair value	(9,862)		(2,411)		(3,818)
Net unrealized (losses) gains on equity securities with readily determinable fair value	(8,708)		277		447

Upward adjustments of equity securities without readily determinable fair values	—		—		401
Downward adjustments of equity securities without readily determinable fair values	—		—		—
Impairment of equity securities without readily determinable fair values	(12,158)		(2,415)		(2,995)
Adjustment and impairment, net, of equity securities without readily determinable fair values	(12,158)		(2,415)		(2,594)

Losses on investment securities, net	$	(20,427)	$	(1,059)	$	(1,926)

Proceeds from sales of available-for-sale securities(1)	$	—	$	192,227	$	502,250
Proceeds from sales of equity securities with readily determinable fair value	31,753		9,759		6,530
Proceeds from sales and capital distributions of equity securities without readily determinable fair value	1,330		2,685		1,857

(1)Includes proceeds from available-for-sale securities sold in accordance with written covered call options sold to a third party.

Net losses on investment securities resulted in income tax benefit of $5.4 million, $282,000 and $513,000 in 2022, 2021 and 2020, respectively.

The amortized cost and fair value of investment securities as of December 31, 2022 and December 31, 2021, by contractual maturity, are shown in the following table. Contractual maturities may differ from actual maturities as borrowers may have the right to call or repay obligations with or without call or prepayment penalties. Mortgage-backed securities are not included in the maturity categories in the following maturity summary as actual maturities may differ from contractual maturities because the underlying mortgages may be called or prepaid without penalties:


	December 31, 2022				December 31, 2021
(In thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Available-for-sale securities
Due in one year or less	$	119,830	$	119,275	$	49,714	$	49,822
Due in one to five years	63,644		61,701		72,382		73,850
Due in five to ten years	115,734		105,076		118,358		117,573
Due after ten years	64,590		57,478		69,200		72,560
Mortgage-backed	3,405,836		2,899,487		2,006,715		2,013,988

Total available-for-sale securities	$	3,769,634	$	3,243,017	$	2,316,369	$	2,327,793
Held-to-maturity securities
Due in one year or less	$	1,340	$	1,332	$	2,976	$	2,992
Due in one to five years	94,705		89,093		79,422		79,705
Due in five to ten years	115,318		113,758		106,713		112,667
Due after ten years	365,510		288,460		222,522		221,358
Mortgage-backed	3,064,182		2,457,178		2,530,730		2,483,972
Total held-to-maturity securities	$	3,641,055	$	2,949,821	$	2,942,363	$	2,900,694
Less: Allowance for credit losses	(488)				(78)
Held-to-maturity securities, net of allowance for credit losses	$	3,640,567			$	2,942,285

At December 31, 2022 and December 31, 2021, securities having a carrying value of $2.8 billion and $2.6 billion, respectively, were pledged as collateral for public deposits, trust deposits, FHLB advances, securities sold under repurchase agreements and derivatives. At December 31, 2022, there were no securities of a single issuer, other than U.S. government-sponsored agency securities, which exceeded 10% of shareholders’ equity.