Securities

12 Months Ended

Dec. 31, 2023

Debt Securities [Abstract]

Securities

Securities

Available for Sale Securities

The amortized cost, gross unrealized gains and losses, ACL and fair value of available for sale securities as of the dates indicated were as follows:

	As of December 31, 2023
	Amortized Cost		Unrealized Gains		Unrealized Losses		Allowance for Credit Losses		Fair Value
	(In thousands)
Debt securities:
Government-sponsored residential mortgage-backed securities	$	3,302,165	$	—	$	(521,527)	$	—	$	2,780,638
Government-sponsored commercial mortgage-backed securities	1,326,029		—		(201,653)		—		1,124,376
U.S. Agency bonds	236,454		—		(20,443)		—		216,011
U.S. Treasury securities	99,552		—		(4,400)		—		95,152
State and municipal bonds and obligations	197,704		172		(6,532)		—		191,344
	$	5,161,904	$	172	$	(754,555)	$	—	$	4,407,521

	As of December 31, 2022
	Amortized Cost		Unrealized Gains		Unrealized Losses		Allowance for Credit Losses		Fair Value
	(In thousands)
Debt securities:
Government-sponsored residential mortgage-backed securities	$	4,855,763	$	—	$	(743,855)	$	—	$	4,111,908
Government-sponsored commercial mortgage-backed securities	1,570,119		—		(221,165)		—		1,348,954
U.S. Agency bonds	1,100,891		—		(148,409)		—		952,482
U.S. Treasury securities	99,324		—		(6,267)		—		93,057
State and municipal bonds and obligations	198,039		9		(14,956)		—		183,092
Other debt securities	1,299		—		(14)		—		1,285
	$	7,825,435	$	9	$	(1,134,666)	$	—	$	6,690,778

The Company did not record a provision for credit losses on any AFS securities during either the year ended December 31, 2023 or 2022. Accrued interest receivable on AFS securities totaled $9.2 million and $12.9 million as of December 31, 2023 and December 31, 2022, respectively, and is included within other assets on the Consolidated Balance Sheets. The Company did not record any write-offs of accrued interest income on AFS securities during either the year ended December 31, 2023 or 2022. No securities held by the Company were delinquent on contractual payments as of December 31, 2023 nor 2022, nor were any such securities placed on non-accrual status during the periods then ended.

As of December 31, 2023 and 2022, the Company had no investments in obligations of individual states, counties, or municipalities which exceeded 10% of consolidated shareholders’ equity.

The following table summarizes gross realized gains and losses from sales of AFS securities for the periods indicated:

	For the Years Ended December 31,
	2023		2022		2021
	(In thousands)
Gross realized gains from sales of AFS securities	$	—	$	1,775	$	1,166
Gross realized losses from sales of AFS securities	(333,170)		(4,932)		—
Net (losses) gains from sales of AFS securities	$	(333,170)	$	(3,157)	$	1,166

Information pertaining to AFS securities with gross unrealized losses as of December 31, 2023 and 2022, for which the Company did not recognize a provision for credit losses under CECL, aggregated by investment category and length of time that individual securities have been in a continuous loss position, is as follows:

	As of December 31, 2023
		Less than 12 Months				12 Months or Longer				Total
	# of Holdings	Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value
	(Dollars in thousands)
Government-sponsored residential mortgage-backed securities	324	$	—	$	—	$	521,527	$	2,780,638	$	521,527	$	2,780,638
Government-sponsored commercial mortgage-backed securities	187	—		—		201,653		1,124,376		201,653		1,124,376
U.S. Agency bonds	23	—		—		20,443		216,011		20,443		216,011
U.S. Treasury securities	6	36		4,927		4,364		90,225		4,400		95,152
State and municipal bonds and obligations	196	233		22,894		6,299		135,279		6,532		158,173
	736	$	269	$	27,821	$	754,286	$	4,346,529	$	754,555	$	4,374,350

	As of December 31, 2022
		Less than 12 Months				12 Months or Longer				Total
	# of Holdings	Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value
	(Dollars in thousands)
Government-sponsored residential mortgage-backed securities	322	$	42,196	$	435,690	$	701,659	$	3,676,218	$	743,855	$	4,111,908
Government-sponsored commercial mortgage-backed securities	199	38,944		300,476		182,221		1,048,478		221,165		1,348,954
U.S. Agency bonds	37	645		4,145		147,764		948,337		148,409		952,482
U.S. Treasury securities	5	1,311		48,451		4,956		44,606		6,267		93,057
State and municipal bonds and obligations	237	14,942		179,614		14		225		14,956		179,839
Other debt securities	2	—		—		14		1,285		14		1,285
	802	$	98,038	$	968,376	$	1,036,628	$	5,719,149	$	1,134,666	$	6,687,525

The Company does not intend to sell these investments and has determined based upon available evidence that it is more-likely-than-not that the Company will not be required to sell each security before the expected recovery of its amortized cost basis. As a result, the Company did not recognize an ACL on these investments as of either December 31, 2023 or 2022.

The causes of the impairments listed in the tables above by category are as follows as of December 31, 2023 and 2022:

•Government-sponsored mortgage-backed securities, U.S. Agency bonds and U.S. Treasury securities – The securities with unrealized losses in these portfolios have contractual terms that generally do not permit the issuer to settle the security at a price less than the current par value of the investment. The decline in market value of these securities is attributable to changes in interest rates and not credit quality. Additionally, these securities are implicitly guaranteed by the U.S. government or one of its agencies.

•State and municipal bonds and obligations – The securities with unrealized losses in this portfolio have contractual terms that generally do not permit the issuer to settle the security at a price less than the current par value of the investment. The decline in market value of these securities is attributable to changes in interest rates and not credit quality.

•Other debt securities – As of December 31, 2022, there were two securities included in this portfolio in an unrealized loss position which consisted of two foreign debt securities. Both securities were performing in accordance with the terms of their respective contractual agreements. The decline in market value of these securities was attributable to changes in interest rates and not credit quality.

Held to Maturity Securities

The amortized cost, gross unrealized gains and losses, ACL and fair value of HTM securities as of the dates indicated were as follows:

	As of December 31, 2023
	Amortized Cost		Unrealized Gains		Unrealized Losses		Allowance for Credit Losses		Fair Value
	(In thousands)
Debt securities:
Government-sponsored residential mortgage-backed securities	$	254,752	$	—	$	(24,433)	$	—	$	230,319
Government-sponsored commercial mortgage-backed securities	194,969		—		(20,466)		—		174,503
	$	449,721	$	—	$	(44,899)	$	—	$	404,822

	As of December 31, 2022
	Amortized Cost		Unrealized Gains		Unrealized Losses		Allowance for Credit Losses		Fair Value
	(In thousands)
Debt securities:
Government-sponsored residential mortgage-backed securities	$	276,493	$	—	$	(30,150)	$	—	$	246,343
Government-sponsored commercial mortgage-backed securities	200,154		—		(23,271)		—		176,883
	$	476,647	$	—	$	(53,421)	$	—	$	423,226

The Company did not record a provision for estimated credit losses on any HTM securities during either the year ended December 31, 2023 or 2022. The accrued interest receivable on HTM securities totaled $0.9 million and $1.0 million as of December 31, 2023 and 2022, respectively, and is included within other assets on the Consolidated Balance Sheets. The Company did not record any write-offs of accrued interest receivable on HTM securities during either the year ended December 31, 2023 or 2022. No HTM securities held by the Company were delinquent on contractual payments as of either December 31, 2023 or 2022, nor were any such securities placed on non-accrual status during the periods then ended.

Available for Sale and Held to Maturity Securities Contractual Maturity

The amortized cost and estimated fair value of AFS and HTM securities by scheduled contractual maturities as of dates indicated were as follows:

	As of December 31, 2023
	Due in one year or less				Due after one year to five years				Due after five to 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
	(In thousands)
AFS securities
Government-sponsored residential mortgage-backed securities	$	—	$	—	$	29,288	$	28,188	$	22,735	$	21,235	$	3,250,142	$	2,731,215	$	3,302,165	$	2,780,638
Government-sponsored commercial mortgage-backed securities	—		—		256,229		234,725		379,749		327,198		690,051		562,453		1,326,029		1,124,376
U.S. Agency bonds	—		—		236,454		216,011		—		—		—		—		236,454		216,011
U.S. Treasury securities	—		—		99,552		95,152		—		—		—		—		99,552		95,152
State and municipal bonds and obligations	213		209		30,131		29,393		44,047		43,260		123,313		118,482		197,704		191,344
Total available for sale securities	213		209		651,654		603,469		446,531		391,693		4,063,506		3,412,150		5,161,904		4,407,521
HTM securities
Government-sponsored residential mortgage-backed securities	—		—		—		—		—		—		254,752		230,319		254,752		230,319
Government-sponsored commercial mortgage-backed securities	—		—		80,014		72,952		114,955		101,551		—		—		194,969		174,503
Total held to maturity securities	—		—		80,014		72,952		114,955		101,551		254,752		230,319		449,721		404,822
Total	$	213	$	209	$	731,668	$	676,421	$	561,486	$	493,244	$	4,318,258	$	3,642,469	$	5,611,625	$	4,812,343

	As of December 31, 2022
	Due in one year or less				Due after one year to five years				Due after five to 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
	(In Thousands)
AFS securities
Government-sponsored residential mortgage-backed securities	$	—	$	—	$	21,221	$	20,284	$	727,908	$	648,132	$	4,106,634	$	3,443,492	$	4,855,763	$	4,111,908
Government-sponsored commercial mortgage-backed securities	—		—		191,762		171,992		649,659		556,641		728,698		620,321		1,570,119		1,348,954
U.S. Agency bonds	—		—		877,371		767,464		223,520		185,018		—		—		1,100,891		952,482
U.S. Treasury securities	—		—		99,324		93,057		—		—		—		—		99,324		93,057
State and municipal bonds and obligations	213		209		22,100		21,283		42,554		40,970		133,172		120,630		198,039		183,092
Other debt securities	1,299		1,285		—		—		—		—		—		—		1,299		1,285
Total available for sale securities	1,512		1,494		1,211,778		1,074,080		1,643,641		1,430,761		4,968,504		4,184,443		7,825,435		6,690,778
HTM securities
Government-sponsored residential mortgage-backed securities	—		—		—		—		—		—		276,493		246,343		276,493		246,343
Government-sponsored commercial mortgage-backed securities	—		—		—		—		200,154		176,883		—		—		200,154		176,883
Total held to maturity securities	—		—		—		—		200,154		176,883		276,493		246,343		476,647		423,226
Total	$	1,512	$	1,494	$	1,211,778	$	1,074,080	$	1,843,795	$	1,607,644	$	5,244,997	$	4,430,786	$	8,302,082	$	7,114,004

Mortgage-backed securities include investments in securities that are insured or guaranteed by Freddie Mac, Ginnie Mae or Fannie Mae. Mortgage-backed securities are purchased to achieve positive interest rate spread with minimal administrative expense, and to lower the Company’s credit risk. Mortgage-backed securities and callable securities are shown at their contractual maturity dates. However, both are expected to have shorter average lives due to expected prepayments and callable features, respectively. Included in the above maturity tables as of December 31, 2023 and 2022 were $394.4 million, and $852.9 million, respectively, of callable securities at fair value.

Securities Pledged as Collateral

As of December 31, 2023 and 2022, securities with a carrying value of $615.7 million and $437.9 million, respectively, were pledged to secure public deposits and for other purposes required by law. As of December 31, 2023 and 2022, deposits with associated pledged collateral included cash accounts from the Company’s wealth management division (“Eastern Wealth Management”) and municipal deposit accounts.

In March 2023 the Federal Reserve created the Bank Term Funding Program (the “Program”) in order to support American businesses and households. The Program helps make available additional funding to eligible depository institutions in order to help assure banks have the ability to meet the needs of their depositors. The Program offers loans up to one year in

length to banks in return for any collateral eligible for purchase by the Federal Reserve Banks in open market operations, such as U.S. Treasuries, U.S. agency securities, and U.S. agency mortgage-backed securities. As of December 31, 2023, securities with a carrying value of $2.4 billion were pledged as collateral through the Program. In addition, the Company pledged securities with a carrying value of $168.8 million to the Federal Reserve Discount Window (the “Discount Window”) as of December 31, 2023. No securities were pledged to the Program or the Discount Window as of December 31, 2022.