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Securities Available For Sale

6 Months Ended

Jun. 30, 2022

Note 2: Securities Available For Sale

The amortized cost and approximate fair values, together with gross unrealized gains and losses, of securities were as follows:


	June 30, 2022
			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value

	(In thousands)
Available for sale securities:
Treasury notes	$	35,111	$	1	$	308	$	34,804
Federal agencies		284,978		—		10,126		274,852
Mortgage-backed - Government-sponsored entity (GSE)		15,774		12		7		15,779
Mortgage-backed - Non-GSE multi-family		11,731		—		352		11,379
Total available for sale securities	$	347,594	$	13	$	10,793	$	336,814


	December 31, 2021
			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value

	(In thousands)
Available for sale securities:
Treasury notes	$	8,232	$	4	$	27	$	8,209
Federal agencies		264,970		—		1,675		263,295
Municipals		4,300		—		—		4,300
Mortgage-backed - Government-sponsored entity (GSE)		18,664		32		336		18,360
Mortgage-backed - Non-GSE multi-family		16,424		41		—		16,465
Total available for sale securities	$	312,590	$	77	$	2,038	$	310,629

At June 30, 2022 and December 31, 2021, GSE mortgage-backed securities included in the tables above are primarily backed by multi-family loans. The tables above for June 30, 2022 and December 31, 2021 also include securities purchased from Freddie Mac following the loan sale and securitization arrangement with Freddie Mac described in Note 4: Loans and Allowance for Credit Losses on Loans.

Accrued interest on available for sale securities totaled $0.5 million at June 30, 2022 and $0.4 million at December 31, 2021, respectively, and is excluded from the estimate of credit losses.

The amortized cost and fair value of available for sale securities at June 30, 2022 and December 31, 2021, by contractual maturity, are 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 are shown separately.


	June 30, 2022				December 31, 2021
	Amortized		Fair		Amortized		Fair
	Cost		Value		Cost		Value

Contractual Maturity	(In thousands)
Within one year	$	54,247	$	52,983	$	6,548	$	6,551
After one through five years		265,842		256,673		270,954		269,253
After five through ten years		—		—		—		—
After ten years		—		—		—		—
		320,089		309,656		277,502		275,804
Mortgage-backed - Government-sponsored entity (GSE)		15,774		15,779		18,664		18,360
Mortgage-backed - Non-GSE multi-family		11,731		11,379		16,424		16,465
	$	347,594	$	336,814	$	312,590	$	310,629

During the three and six months ended June 30, 2022, no securities available for sale were sold. During the three and six months ended June 30, 2021 proceeds from sales of $34.5 million securities available for sale were sold, and no gain or loss was recognized.

The following tables show the Company’s investments’ gross unrealized losses and fair value of the Company’s investments with unrealized losses that are not deemed to be other-than-temporarily impaired, aggregated by investment class and length of time that individual securities have been in a continuous unrealized loss position at June 30, 2022 and December 31, 2021:


	June 30, 2022
					12 Months or
	Less than 12 Months				Longer				Total
			Gross				Gross				Gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Losses		Value		Losses		Value		Losses

	(In thousands)
Available for sale securities:
Treasury notes	$	32,599	$	263	$	1,955	$	45	$	34,554	$	308
Federal agencies		169,115		5,884		105,737		4,242		274,852		10,126
Mortgage-backed - Government-sponsored entity (GSE)		798		7		—		—		798		7
Mortgage-backed - Non-GSE multi-family		—		352		—		—		—		352
	$	202,512	$	6,506	$	107,692	$	4,287	$	310,204	$	10,793


	December 31, 2021
					12 Months or
	Less than 12 Months				Longer				Total
			Gross				Gross				Gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Losses		Value		Losses		Value		Losses

	(In thousands)
Available for sale securities:
Treasury notes	$	7,957	$	27	$	—	$	—	$	7,957	$	27
Federal agencies		238,489		1,503		24,806		172		263,295		1,675
Mortgage-backed - Government-sponsored entity (GSE)		719		336		—		—		719		336
	$	247,165	$	1,866	$	24,806	$	172	$	271,971	$	2,038

For available for sale securities with an unrealized loss position, the Company evaluates the securities to determine whether the decline in the fair value below the amortized cost basis (impairment) is due to credit-related factors or non-credit related factors. Any impairment that is not credit-related is recognized in AOCI, net of tax. Credit-related impairment is recognized as an ACL for available for sale securities on the balance sheet, limited to the amount by which the amortized cost basis exceeds the fair value, with a corresponding adjustment to earnings. Accrued interest receivable is excluded from the estimate of credit losses. Both the ACL and the adjustment to net income may be reversed if conditions change. However, if the Company expects, or is required, to sell an impaired available for sale security before recovering its amortized cost basis, the entire impairment amount would be recognized in earnings with a corresponding adjustment to the security’s amortized cost basis. Because the security’s amortized cost basis is adjusted to fair value, there is no ACL in this situation.

In evaluating available for sale securities in unrealized loss positions for impairment and the criteria regarding its intent or requirement to sell such securities, the Company considers the extent to which fair value is less than amortized cost, whether the securities are issued by the federal government or its agencies, whether downgrades by bond rating agencies have occurred, and the results of reviews of the issuers’ financial condition, among other factors. Unrealized losses on the Company’s investment securities portfolio have not been recognized as an expense because the securities are of high credit quality, and the decline in fair values is attributable to changes in the prevailing interest rate environment since the purchase date. Fair value is expected to recover as securities reach maturity and/or the interest rate environment returns to conditions similar to when these securities were purchased. There were no credit related factors underlying unrealized losses on available for sale debt securities at June 30, 2022 and December 31, 2021.