Securities

6 Months Ended

Jun. 30, 2024

Available for Sale Securities

The amortized cost, gross unrealized gains and losses, allowance for credit losses (“ACL”) and fair value of available for sale (“AFS”) securities as of the dates indicated were as follows:


	As of June 30, 2024
	Amortized Cost		Unrealized Gains		Unrealized Losses		Allowance for Credit Losses		Fair Value
	(In thousands)
Debt securities:
Government-sponsored residential mortgage-backed securities	$	3,148,711	$	—	$	(551,161)	$	—	$	2,597,550
Government-sponsored commercial mortgage-backed securities	1,302,782		—		(211,888)		—		1,090,894
U.S. Agency bonds	144,227		—		(13,989)		—		130,238
U.S. Treasury securities	99,667		—		(4,113)		—		95,554
State and municipal bonds and obligations	197,669		—		(14,063)		—		183,606
	$	4,893,056	$	—	$	(795,214)	$	—	$	4,097,842


	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

The Company did not record a provision for credit losses on any AFS securities for either the three and six months ended June 30, 2024 or 2023. Accrued interest receivable on AFS securities totaled $8.7 million and $9.2 million as of June 30, 2024 and December 31, 2023, 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 AFS securities during either the three and six months ended June 30, 2024 or 2023. No AFS securities held by the Company were delinquent on contractual payments as of June 30,

2024 or December 31, 2023, nor were any AFS securities placed on non-accrual status during the six- and twelve-month periods then ended.

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


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
	(In thousands)
Gross realized gains from sales of AFS securities	$	—	$	—	$	—	$	—
Gross realized losses from sales of AFS securities	(7,557)		—		(7,557)		(333,170)
Net losses from sales of AFS securities	$	(7,557)	$	—	$	(7,557)	$	(333,170)

Information pertaining to AFS securities with gross unrealized losses as of June 30, 2024 and December 31, 2023, for which the Company did not recognize a provision for credit losses under the current expected credit loss methodology (“CECL”), aggregated by investment category and length of time that individual securities had been in a continuous loss position, is as follows:


	As of June 30, 2024
		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	$	—	$	—	$	551,161	$	2,597,550	$	551,161	$	2,597,550
Government-sponsored commercial mortgage-backed securities	187	—		—		211,888		1,090,894		211,888		1,090,894
U.S. Agency bonds	14	—		—		13,989		130,238		13,989		130,238
U.S. Treasury securities	6	—		—		4,113		95,554		4,113		95,554
State and municipal bonds and obligations	240	1,312		32,451		12,751		151,155		14,063		183,606
	771	$	1,312	$	32,451	$	793,902	$	4,065,391	$	795,214	$	4,097,842


	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

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 June 30, 2024 or December 31, 2023.

The causes of the impairments listed in the tables above by category are as follows as of June 30, 2024 and December 31, 2023:

•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

Held to Maturity Securities

The amortized cost, gross unrealized gains and losses, allowance for credit losses and fair value of held to maturity (“HTM”) securities as of the dates indicated were as follows:


	As of June 30, 2024
	Amortized Cost		Unrealized Gains		Unrealized Losses		Allowance for Credit Losses		Fair Value
	(In thousands)
Debt securities:
Government-sponsored residential mortgage-backed securities	$	243,919	$	—	$	(29,438)	$	—	$	214,481
Government-sponsored commercial mortgage-backed securities	192,793		—		(21,876)		—		170,917
	$	436,712	$	—	$	(51,314)	$	—	$	385,398


	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

The Company did not record a provision for estimated credit losses on any HTM securities for either the three and six months ended June 30, 2024 or 2023. The accrued interest receivable on HTM securities totaled $0.9 million as of both June 30, 2024 and December 31, 2023 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 three and six months ended June 30, 2024 or 2023. No HTM securities held by the Company were delinquent on contractual payments as of either June 30, 2024 or December 31, 2023, nor were any HTM securities placed on non-accrual status during the six and twelve month 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 contractual maturities as of June 30, 2024 and December 31, 2023 are shown below. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without prepayment penalties.

The scheduled contractual maturities of AFS and HTM securities as of the dates indicated were as follows:


	As of June 30, 2024
	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	$	—	$	—	$	27,804	$	26,680	$	15,471	$	14,222	$	3,105,436	$	2,556,648	$	3,148,711	$	2,597,550
Government-sponsored commercial mortgage-backed securities	—		—		403,508		364,695		224,736		187,823		674,538		538,376		1,302,782		1,090,894
U.S. Agency bonds	—		—		144,227		130,238		—		—		—		—		144,227		130,238
U.S. Treasury securities	29,964		29,383		69,703		66,171		—		—		—		—		99,667		95,554
State and municipal bonds and obligations	3,299		3,240		33,012		31,373		47,707		44,979		113,651		104,014		197,669		183,606
Total available for sale securities	33,263		32,623		678,254		619,157		287,914		247,024		3,893,625		3,199,038		4,893,056		4,097,842
HTM securities
Government-sponsored residential mortgage-backed securities	—		—		—		—		—		—		243,919		214,481		243,919		214,481
Government-sponsored commercial mortgage-backed securities	—		—		135,611		121,904		57,182		49,013		—		—		192,793		170,917
Total held to maturity securities	—		—		135,611		121,904		57,182		49,013		243,919		214,481		436,712		385,398
Total	$	33,263	$	32,623	$	813,865	$	741,061	$	345,096	$	296,037	$	4,137,544	$	3,413,519	$	5,329,768	$	4,483,240


	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		0	—		—		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

Securities Pledged as Collateral

As of June 30, 2024 and December 31, 2023, securities with a carrying value of $852.1 million and $615.7 million, respectively, were pledged to secure public deposits and for other purposes required by law. As of June 30, 2024 and December 31, 2023, 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”) that offered eligible depository institutions loans up to one year in length in return for any collateral eligible for purchase by the Federal Reserve Banks in open market operations, such as U.S. Treasuries. As of December 31, 2023, securities with a carrying value of $2.4 billion were pledged as collateral through the Program. On January 24, 2024, the Federal Reserve Board announced the Program would cease making new loans as scheduled on March 11, 2024. Accordingly, no securities were pledged as collateral under the Program as of June 30, 2024. Separately, as of June 30, 2024 and December 31, 2023, the Company pledged securities with a carrying value of $1.9 billion and $168.8 million, respectively, to the Federal Reserve Discount Window (the “Discount Window”).