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INVESTMENTS (Tables)
 6 Months Ended
Jun. 30, 2024
Amortized Cost and Fair Value of Securities Available-for-Sale

The amortized cost and fair value of available-for-sale securities and the related gross unrealized gains and losses recognized in accumulated other comprehensive income (loss) are listed below.

 

 

Amortized
Cost

 

 

Gross
Unrealized
Gains

 

 

Gross
Unrealized
Losses

 

 

Allowance
for Credit
Losses

 

 

Fair
Value

 

June 30, 2024

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Available-for-sale securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Government-sponsored entities

 

$

81,808

 

 

$

—

 

 

$

(6,676

)

 

$

—

 

 

$

75,132

 

U.S. Treasury securities

 

 

95,779

 

 

 

1

 

 

 

(741

)

 

 

—

 

 

 

95,039

 

Mortgage-backed securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Government-sponsored residential mortgage-backed securities

 

 

642,210

 

 

 

758

 

 

 

(39,121

)

 

 

—

 

 

 

603,847

 

Private label residential mortgage-backed securities

 

 

152,161

 

 

 

—

 

 

 

(23,096

)

 

 

—

 

 

 

129,065

 

Corporate

 

 

61,274

 

 

 

45

 

 

 

(5,224

)

 

 

—

 

 

 

56,095

 

Small Business Administration loan pools

 

 

7,203

 

 

 

—

 

 

 

(330

)

 

 

—

 

 

 

6,873

 

State and political subdivisions

 

 

86,371

 

 

 

25

 

 

 

(10,271

)

 

 

—

 

 

 

76,125

 

 

 

$

1,126,806

 

 

$

829

 

 

$

(85,459

)

 

$

—

 

 

$

1,042,176

 

 

 

Amortized
Cost

 

 

Gross
Unrealized
Gains

 

 

Gross
Unrealized
Losses

 

 

Allowance
for Credit
Losses

 

 

Fair
Value

 

December 31, 2023

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Available-for-sale securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Government-sponsored entities

 

$

39,103

 

 

$

—

 

 

$

(6,016

)

 

$

—

 

 

$

33,087

 

U.S. Treasury securities

 

 

89,999

 

 

 

28

 

 

 

(771

)

 

 

—

 

 

 

89,256

 

Mortgage-backed securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Government-sponsored residential mortgage-backed securities

 

 

560,674

 

 

 

3,872

 

 

 

(35,403

)

 

 

—

 

 

 

529,143

 

Private label residential mortgage-backed securities

 

 

161,174

 

 

 

—

 

 

 

(23,333

)

 

 

—

 

 

 

137,841

 

Corporate

 

 

56,722

 

 

 

—

 

 

 

(7,039

)

 

 

—

 

 

 

49,683

 

Small Business Administration loan pools

 

 

8,066

 

 

 

—

 

 

 

(339

)

 

 

—

 

 

 

7,727

 

State and political subdivisions

 

 

81,458

 

 

 

74

 

 

 

(8,621

)

 

 

—

 

 

 

72,911

 

 

 

$

997,196

 

 

$

3,974

 

 

$

(81,522

)

 

$

—

 

 

$

919,648

 
Amortized Cost and Fair Value of Securities Held-to-Maturity

The amortized cost and fair value of held-to-maturity securities and the related gross unrecognized gains and losses are listed in the following tables.

 

 

 

Amortized
Cost

 

 

Gross
Unrecognized
Gains

 

 

Gross
Unrecognized
Losses

 

 

Allowance
for Credit
Losses

 

 

Fair
Value

 

June 30, 2024

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Held-to-maturity securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage-backed securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Government-sponsored residential mortgage-backed securities

 

$

4,112

 

 

$

36

 

 

$

(25

)

 

$

—

 

 

$

4,123

 

State and political subdivisions

 

 

1,114

 

 

 

30

 

 

 

—

 

 

 

—

 

 

 

1,144

 

 

 

$

5,226

 

 

$

66

 

 

$

(25

)

 

$

—

 

 

$

5,267

 

 

 

 

 

Amortized
Cost

 

 

Gross
Unrecognized
Gains

 

 

Gross
Unrecognized
Losses

 

 

Allowance
for Credit
Losses

 

 

Fair
Value

 

December 31, 2023

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Held-to-maturity securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage-backed securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Government-sponsored residential mortgage-backed securities

 

$

1,094

 

 

$

3

 

 

$

—

 

 

$

—

 

 

$

1,097

 

State and political subdivisions

 

 

1,115

 

 

 

38

 

 

 

—

 

 

 

—

 

 

 

1,153

 

 

 

$

2,209

 

 

$

41

 

 

$

—

 

 

$

—

 

 

$

2,250

 
Fair Value and Amortized Cost of Debt Securities by Contractual Maturity

The fair value and amortized cost of debt securities at June 30, 2024, by contractual maturity, is shown below. Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date, primarily mortgage-backed securities, are shown separately.

 

 

Available-for-Sale

 

 

Held-to-Maturity

 

 

 

Amortized
Cost

 

 

Fair
Value

 

 

Amortized
Cost

 

 

Fair
Value

 

Within one year

 

$

99,620

 

 

$

98,934

 

 

$

—

 

 

$

—

 

One to five years

 

 

61,425

 

 

 

60,672

 

 

 

—

 

 

 

—

 

Five to ten years

 

 

130,282

 

 

 

115,146

 

 

 

—

 

 

 

—

 

After ten years

 

 

41,108

 

 

 

34,512

 

 

 

1,114

 

 

 

1,144

 

Mortgage-backed securities

 

 

794,371

 

 

 

732,912

 

 

 

4,112

 

 

 

4,123

 

Total debt securities

 

$

1,126,806

 

 

$

1,042,176

 

 

$

5,226

 

 

$

5,267

 
Carrying Value of Securities Pledged as Collateral to Secure Public Fund Deposits

The following table shows the carrying value and fair value of securities pledged as collateral to secure public fund deposits, borrowings from the Federal Home Loan Bank and Federal Reserve Bank and retail repurchase obligations at June 30, 2024, and December 31, 2023.

 

 

June 30, 2024

 

 

December 31, 2023

 

 

 

Book Value

 

 

Fair Value

 

 

Book Value

 

 

Fair Value

 

Public fund deposits

 

$

728,979

 

 

$

691,028

 

 

$

509,010

 

 

$

488,270

 

Federal Home Loan Bank pledging

 

 

109,856

 

 

 

93,337

 

 

 

84,421

 

 

 

72,293

 

Federal Reserve Bank borrowings

 

 

12,119

 

 

 

11,763

 

 

 

158,382

 

 

 

141,125

 

Retail repurchase agreements

 

 

44,032

 

 

 

40,204

 

 

 

51,548

 

 

 

47,282

 

Total securities pledged

 

$

894,986

 

 

$

836,332

 

 

$

803,361

 

 

$

748,970

 
Summary of Gross Unrealized Losses and Fair Value of Securities

The following tables show gross unrealized losses or unrecognized losses and fair value, aggregated by investment category, and length of time that individual securities have been in a continuous unrealized loss position or unrecognized loss position at June 30, 2024, and December 31, 2023.

 

 

Less Than 12 Months

 

 

12 Months or More

 

 

Total

 

 

 

Fair
Value

 

 

Unrealized
Loss

 

 

Fair
Value

 

 

Unrealized
Loss

 

 

Fair
Value

 

 

Unrealized
Loss

 

June 30, 2024

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Available-for-sale securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Government-sponsored entities

 

$

42,820

 

 

$

(292

)

 

$

32,312

 

 

$

(6,384

)

 

$

75,132

 

 

$

(6,676

)

U.S. Treasury securities

 

 

65,470

 

 

 

(229

)

 

 

19,591

 

 

 

(512

)

 

 

85,061

 

 

 

(741

)

Mortgage-backed securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Government-sponsored residential mortgage-backed securities

 

 

207,375

 

 

 

(1,436

)

 

 

287,668

 

 

 

(37,685

)

 

 

495,043

 

 

 

(39,121

)

Private label residential mortgage-backed securities

 

 

—

 

 

 

—

 

 

 

129,065

 

 

 

(23,096

)

 

 

129,065

 

 

 

(23,096

)

Corporate

 

 

4,646

 

 

 

(54

)

 

 

46,743

 

 

 

(5,170

)

 

 

51,389

 

 

 

(5,224

)

Small Business Administration loan pools

 

 

4,462

 

 

 

(2

)

 

 

2,411

 

 

 

(328

)

 

 

6,873

 

 

 

(330

)

State and political subdivisions

 

 

13,592

 

 

 

(866

)

 

 

60,012

 

 

 

(9,405

)

 

 

73,604

 

 

 

(10,271

)

Total

 

$

338,365

 

 

$

(2,879

)

 

$

577,802

 

 

$

(82,580

)

 

$

916,167

 

 

$

(85,459

)

December 31, 2023

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Available-for-sale securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Government-sponsored entities

 

$

—

 

 

$

—

 

 

$

33,087

 

 

$

(6,016

)

 

$

33,087

 

 

$

(6,016

)

U.S. Treasury securities

 

 

—

 

 

 

—

 

 

 

19,413

 

 

 

(771

)

 

 

19,413

 

 

 

(771

)

Mortgage-backed securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Government-sponsored residential mortgage-backed securities

 

 

7,799

 

 

 

(5

)

 

 

306,858

 

 

 

(35,398

)

 

 

314,657

 

 

 

(35,403

)

Private label residential mortgage-backed securities

 

 

—

 

 

 

—

 

 

 

137,841

 

 

 

(23,333

)

 

 

137,841

 

 

 

(23,333

)

Corporate

 

 

—

 

 

 

—

 

 

 

49,683

 

 

 

(7,039

)

 

 

49,683

 

 

 

(7,039

)

Small Business Administration loan pools

 

 

5,097

 

 

 

(14

)

 

 

2,630

 

 

 

(325

)

 

 

7,727

 

 

 

(339

)

State and political subdivisions

 

 

11,386

 

 

 

(768

)

 

 

57,326

 

 

 

(7,853

)

 

 

68,712

 

 

 

(8,621

)

Total

 

$

24,282

 

 

$

(787

)

 

$

606,838

 

 

$

(80,735

)

 

$

631,120

 

 

$

(81,522

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Less Than 12 Months

 

 

12 Months or More

 

 

Total

 

 

 

Fair
Value

 

 

Unrecognized
Loss

 

 

Fair
Value

 

 

Unrecognized
Loss

 

 

Fair
Value

 

 

Unrecognized
Loss

 

June 30, 2024

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Held-to-maturity securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential mortgage-backed (issued by government-sponsored entities)

 

$

1,061

 

 

$

(25

)

 

$

—

 

 

$

—

 

 

$

1,061

 

 

$

(25

)

State and political subdivisions

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Total

 

$

1,061

 

 

$

(25

)

 

$

—

 

 

$

—

 

 

$

1,061

 

 

$

(25

)

December 31, 2023

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Held-to-maturity securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential mortgage-backed (issued by government-sponsored entities)

 

$

—

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

—

 

State and political subdivisions

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Total

 

$

—

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

—

 
Summary of Proceeds from Sales and Associated Gains and Losses

The proceeds from sales and the associated gains and losses on available-for-sale securities reclassified from other comprehensive income to income are listed below.

 

 

Three Months Ended
June 30,

 

 

Six Months Ended
June 30,

 

 

 

2024

 

 

2023

 

 

2024

 

 

2023

 

Proceeds

 

$

—

 

 

$

49,258

 

 

$

726

 

 

$

49,258

 

Gross gain

 

 

—

 

 

 

—

 

 

 

3

 

 

 

—

 

Gross losses

 

 

—

 

 

 

1,330

 

 

 

255

 

 

 

1,330

 

Income tax expense/(benefit)

 

 

—

 

 

 

(325

)

 

 

(62

)

 

 

(325

)
Summary of Various Investment Balances and Method of Accounting

The Company also invests in several other investments, including investments in stocks and partnerships, which are included in other assets. The following table shows the various investment balances and method of accounting at June 30, 2024, and December 31, 2023.

 

 

June 30, 2024

 

 

December 31, 2023

 

Investments in stocks

 

 

 

 

 

 

Accounted for at fair value through net income

 

$

648

 

 

$

674

 

Accounted for at amortized cost assessed for impairment

 

 

1,981

 

 

 

1,397

 

Total investments in stocks

 

 

2,629

 

 

 

2,071

 

Investments in partnerships

 

 

 

 

 

 

Accounted for under the equity method

 

 

2,500

 

 

 

2,345

 

Accounted for under the hypothetical liquidation book value

 

 

2,203

 

 

 

2,403

 

Accounted for under proportional amortization

 

 

27,153

 

 

 

24,296

 

Total investments in partnerships

 

 

31,856

 

 

 

29,044

 

Total other investments

 

$

34,485

 

 

$

31,115

 
Impact of Tax Credit Investments

The following table discloses the financial statement impact of tax credit investments for the three month period ended June 30, 2024, and 2023.

 

 

Income Tax Credits Recognized During Period (a)

 

 

Other Income Tax Benefits (a)

 

 

Total Tax Benefits

 

 

Investment Amortization Included in Income Tax Expense

 

June 30, 2024

 

 

 

 

 

 

 

 

 

 

 

 

Investments and tax credit structures:

 

 

 

 

 

 

 

 

 

 

 

 

Included in proportional amortization

 

$

(4,332

)

 

$

(526

)

 

$

(4,858

)

 

$

4,219

 

Not included in proportional amortization

 

$

—

 

 

$

72

 

 

$

72

 

 

$

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30, 2023

 

 

 

 

 

 

 

 

 

 

 

 

Investments and tax credit structures:

 

 

 

 

 

 

 

 

 

 

 

 

Included in proportional amortization

 

$

(5,469

)

 

$

(829

)

 

$

(6,298

)

 

$

5,575

 

Not included in proportional amortization

 

$

(870

)

 

$

(223

)

 

$

(1,093

)

 

$

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(a) Reported in income tax expense on statements of income and reported in net change in other assets on statements of cash flows.

 

 

The following table discloses the financial statement impact of tax credit investments for the six month period ended June 30, 2024, and 2023.

 

 

Income Tax Credits Recognized During Period (a)

 

 

Other Income Tax Benefits (a)

 

 

Total Tax Benefits

 

 

Investment Amortization Included in Income Tax Expense

 

June 30, 2024

 

 

 

 

 

 

 

 

 

 

 

 

Investments and tax credit structures:

 

 

 

 

 

 

 

 

 

 

 

 

Included in proportional amortization

 

$

(5,158

)

 

$

(751

)

 

$

(5,909

)

 

$

5,143

 

Not included in proportional amortization

 

$

—

 

 

$

95

 

 

$

95

 

 

$

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30, 2023

 

 

 

 

 

 

 

 

 

 

 

 

Investments and tax credit structures:

 

 

 

 

 

 

 

 

 

 

 

 

Included in proportional amortization

 

$

(5,951

)

 

$

(973

)

 

$

(6,924

)

 

$

6,161

 

Not included in proportional amortization

 

$

(1,672

)

 

$

(455

)

 

$

(2,127

)

 

$

—

 

(a) Reported in income tax expense on statements of income and reported in net change in other assets on statements of cash flows.