Investment Securities

3 Months Ended

Mar. 31, 2024

Investment Securities

Investment Securities

(5)      Investment Securities

The amortized cost, gross unrealized gains and losses, fair value, and related ACL of investment securities are as follows:

	Amortized		Gross Unrealized				Estimated
(Dollars in thousands)	Cost		Gains		Losses		Fair Value			ACL
March 31, 2024:
Available-for-sale:
Mortgage-backed securities issued by U.S. government-sponsored enterprises	$	22,415	$	—	$	(2,932)	$	19,483	$	—
Held-to-maturity:
Mortgage-backed securities issued by U.S. government agencies or U.S. government-sponsored enterprises		677,578		36		(130,324)		547,290		—
Total	$	699,993	$	36	$	(133,256)	$	566,773	$	—
December 31, 2023:
Available-for-sale:
Mortgage-backed securities issued by U.S. government-sponsored enterprises	$	22,563	$	—	$	(2,392)	$	20,171	$	—
Held-to-maturity:
Mortgage-backed securities issued by U.S. government agencies or U.S. government-sponsored enterprises		685,728		68		(117,668)		568,128		—
Total	$	708,291	$	68	$	(120,060)	$	588,299	$	—

The amortized cost and estimated fair value of investment securities by maturity date at March 31, 2024 are shown below. Incorporated in the maturity schedule are mortgage-backed securities, which are allocated using the contractual maturity as a basis. Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

	Amortized		Estimated
(Dollars in thousands)	Cost		Fair Value
Available-for-sale:
Due after 10 years	$	22,415	$	19,483
Total	$	22,415	$	19,483
Held-to-maturity:
Due within 5 years	$	12	$	12
Due after 5 years through 10 years		6		6
Due after 10 years		677,560		547,272
Total	$	677,578	$	547,290

The Company did not sell any held-to-maturity or available-for-sale securities during the three months ended March 31, 2024 and 2023.

Investment securities with amortized costs of $549.7 million and $555.8 million at March 31, 2024 and December 31, 2023, respectively, were pledged to secure deposits made by state and local governments, securities sold under agreements to repurchase, transaction clearing accounts, and Federal Reserve Bank borrowings. Included in these amounts were $220.9 million and $74.0 million pledged to the Federal Reserve Bank’s discount window at March 31, 2024 and December 31, 2023, respectively, and $52.6 million and $202.1 million pledged to the Federal Reserve Bank’s Bank Term Funding Program at March 31, 2024 and December 31, 2023, respectively.

Provided below is a summary of investment securities which were in an unrealized loss position at March 31, 2024 and December 31, 2023. The Company does not intend to sell securities until such time as the value recovers or the securities mature and it is not more likely than not that the Company will be required to sell the securities prior to recovery of value or the securities mature.

	Less Than 12 Months				12 Months or Longer				Total
			Unrealized				Unrealized		Number of			Unrealized
Description of securities	Fair Value		Losses		Fair Value		Losses		Securities	Fair Value		Losses
(Dollars in thousands)
March 31, 2024:
Available-for-sale:
Mortgage-backed securities issued by U.S. government-sponsored enterprises	$	—	$	—	$	19,483	$	(2,932)	4	$	19,483	$	(2,932)
Held-to-maturity:
Mortgage-backed securities issued by U.S. government agencies or U.S. government-sponsored enterprises		—		—		544,088		(130,324)	152		544,088		(130,324)
Total	$	—	$	—	$	563,571	$	(133,256)	156	$	563,571	$	(133,256)
December 31, 2023:
Available-for-sale:
Mortgage-backed securities issued by U.S. government sponsored enterprises	$	—	$	—	$	20,171	$	(2,392)	4	$	20,171	$	(2,392)
Held-to-maturity:
Mortgage-backed securities issued by U.S. government agencies or U.S. government-sponsored enterprises		10,326		(107)		554,514		(117,561)	152		564,840		(117,668)
Total	$	10,326	$	(107)	$	574,685	$	(119,953)	156	$	585,011	$	(120,060)

Mortgage-Backed Securities. The unrealized losses on the Company’s investment in mortgage-backed securities were caused by increases in market interest rates subsequent to purchase. All of the mortgage-backed securities are guaranteed by Freddie Mac or Fannie Mae, which are U.S. government-sponsored enterprises, or Ginnie Mae, which is a U.S. government agency. Since the decline in market value is attributable to changes in interest rates and not credit quality, the Company does not intend to sell these investments until maturity, and it is not more likely than not that the Company will be required to sell such investments prior to recovery of its cost basis, no allowance for credit losses was recorded for these securities as of March 31, 2024 or December 31, 2023.