Securities

3 Months Ended

Mar. 31, 2023

Cash and Cash Equivalents [Abstract]

Note 2 - Securities

Debt securities have been classified in the consolidated balance sheets according to management’s intent. The amortized cost, related gross unrealized gains and losses, allowance for credit losses and the fair value of available-for-sale securities are as follows (dollars in thousands):


	March 31, 2023
			Gross		Gross
	Amortized		Unrealized		Unrealized			Estimated
	Cost Basis		Holding Gains		Holding Losses			Fair Value
Securities available-for-sale:
U.S. Treasury securities	$	508,692	$	32	$	(20,482	)	$	488,242
Obligations of states and political subdivisions		1,935,401		1,562		(163,351	)		1,773,612
Residential mortgage-backed securities		2,957,314		17		(374,161	)		2,583,170
Commercial mortgage-backed securities		364,956		—		(15,020	)		349,936
Corporate bonds and other		112,677		—		(9,080	)		103,597
Total securities available-for-sale	$	5,879,040	$	1,611	$	(582,094	)	$	5,298,557


	March 31, 2022
			Gross		Gross
	Amortized		Unrealized		Unrealized			Estimated
	Cost Basis		Holding Gains		Holding Losses			Fair Value
Securities available-for-sale:
U.S. Treasury securities		311,860		-		(10,516	)		301,344
Obligations of states and political subdivisions		2,590,308		26,628		(87,455	)		2,529,481
Residential mortgage-backed securities		3,450,006		2,139		(186,954	)		3,265,191
Commercial mortgage-backed securities		341,506		924		(4,752	)		337,678
Corporate bonds and other		74,287		-		(5,486	)		68,801
Total securities available-for-sale	$	6,767,967	$	29,691	$	(295,163	)	$	6,502,495


	December 31, 2022
			Gross		Gross
	Amortized		Unrealized		Unrealized			Estimated
	Cost Basis		Holding Gains		Holding Losses			Fair Value
Securities available-for-sale:
U.S. Treasury securities	$	508,275	$	11	$	(25,737	)	$	482,549
Obligations of states and political subdivisions		2,104,193		1,217		(206,799	)		1,898,611
Residential mortgage-backed securities		3,034,120		8		(417,562	)		2,616,566
Commercial mortgage-backed securities		392,914		1		(18,046	)		374,869
Corporate bonds and other		112,846		-		(11,082	)		101,764
Total securities available-for-sale	$	6,152,348	$	1,237	$	(679,226	)	$	5,474,359

The Company did not hold any securities classified as held-to-maturity at March 31, 2023, March 31, 2022, or December 31, 2022.

The Company invests in mortgage-backed securities that have expected maturities that differ from their contractual maturities. These differences arise because borrowers may have the right to call or prepay obligations with or without a prepayment penalty. These securities include collateralized mortgage obligations (CMOs) and other asset backed securities. The expected maturities of these securities at March 31, 2023 and 2022, and December 31, 2022, were computed by using scheduled amortization of balances and historical prepayment rates.

The amortized cost and estimated fair value of available-for-sale securities at March 31, 2023, by contractual and expected maturity, are shown below (dollars in thousands):


	Amortized		Estimated
	Cost Basis		Fair Value
Due within one year	$	267,375	$	264,338
Due after one year through five years		1,499,938		1,420,069
Due after five years through ten years		3,126,228		2,771,041
Due after ten years		985,499		843,109
Total	$	5,879,040	$	5,298,557

The following tables disclose as of March 31, 2023 and 2022, and December 31, 2022, the Company’s investment securities that have been in a continuous unrealized-loss position for less than 12 months and for 12 or more months (dollars in thousands):


	Less than 12 Months				12 Months or Longer				Total
March 31, 2023	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
U.S. Treasury securities	$	191,725	$	4,193	$	292,587	$	16,289	$	484,312	$	20,482
Obligations of states and political subdivisions		126,532		1,448		1,470,950		161,903		1,597,482		163,351
Residential mortgage-backed securities		91,738		2,937		2,489,524		371,224		2,581,262		374,161
Commercial mortgage-backed securities		164,301		3,948		185,635		11,072		349,936		15,020
Corporate bonds and other		42,503		1,167		61,094		7,913		103,597		9,080
Total	$	616,799	$	13,693	$	4,499,790	$	568,401	$	5,116,589	$	582,094


	Less than 12 Months				12 Months or Longer				Total
March 31, 2022	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
U.S. Treasury securities	$	301,344	$	10,516	$	—	$	—	$	301,344	$	10,516
Obligations of states and political subdivisions		1,518,732		85,015		25,679		2,440		1,544,411		87,455
Residential mortgage-backed securities		2,725,934		163,034		303,344		23,920		3,029,278		186,954
Commercial mortgage-backed securities		202,719		4,752		—		—		202,719		4,752
Corporate bonds and other		40,701		2,431		28,100		3,055		68,801		5,486
Total	$	4,789,430	$	265,748	$	357,123	$	29,415	$	5,146,553	$	295,163


	Less than 12 Months				12 Months or Longer				Total
December 31, 2022	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
U.S. Treasury securities	$	307,012	$	11,650	$	173,105	$	14,087	$	480,117	$	25,737
Obligations of states and political subdivisions		770,469		55,943		946,571		150,856		1,717,040		206,799
Residential mortgage-backed securities		470,970		37,065		2,143,869		380,497		2,614,839		417,562
Commercial mortgage-backed securities		319,303		11,677		54,862		6,369		374,165		18,046
Corporate bonds and other		41,920		1,698		59,844		9,384		101,764		11,082
Total	$	1,909,674	$	118,033	$	3,378,251	$	561,193	$	5,287,925	$	679,226

The number of investments in an unrealized loss position totaled 897 at March 31, 2023. We believe any unrealized losses in the U.S. treasury securities, obligations of state and political subdivisions, residential and commercial mortgage-backed and asset-backed investment securities, and corporate bonds and other at March 31, 2023 and 2022, and December 31, 2022, are due to changes in interest rates and not credit-related events. As such, no allowance for credit losses is required on these securities at March 31, 2023 and 2022, and December 31, 2022. Unrealized losses on investment securities are expected to recover over time as these securities approach maturity. Our mortgage related securities are backed by GNMA, FNMA and FHLMC or are collateralized by securities backed by these agencies. At March 31, 2023, 70.30% of our available-for-sale securities that are obligations of states and political subdivisions were issued within the State of Texas, of which 52.94% are guaranteed by the Texas Permanent School Fund.

Securities, carried at approximately $3,291,020,000 on March 31, 2023, were pledged as collateral for public or trust fund deposits, repurchase agreements, borrowings and for other purposes required or permitted by law.

During the three-months ended March 31, 2023, sales of investment securities that were classified as available-for-sale were $145,948,000. During the three-months ended March 31, 2022, there were no sales of investment securities that were classified as available-for-sale. Gross realized security gains from sales and calls during the first quarter of 2023 and 2022 totaled $1,052,000 and $33,000, respectively. Gross realized security losses from sales or calls during the first quarter of 2023 or 2022 totaled $1,040,000 and $2,000, respectively.

The specific identification method was used to determine cost in order to compute the realized gains and losses.