
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Allowance for Credit Losses		Net Carrying Amount
September 30, 2023

Residential mortgage-backed securities	$	1,258,155	$	—	$	113,142	$	1,145,013	$	—	$	1,258,155
States and political subdivisions	2,368,778		48		283,585		2,085,241		(310)		2,368,468
Other	1,500		—		63		1,437		—		1,500
Total	$	3,628,433	$	48	$	396,790	$	3,231,691	$	(310)	$	3,628,123
December 31, 2022

Residential mortgage-backed securities	$	526,122	$	—	$	65,322	$	460,800	$	—	$	526,122
States and political subdivisions	2,111,619		13,048		119,033		2,005,634		(158)		2,111,461
Other	1,500		—		69		1,431		—		1,500
Total	$	2,639,241	$	13,048	$	184,424	$	2,467,865	$	(158)	$	2,639,083

All mortgage-backed securities included in the above table were issued by U.S. government agencies and corporations. The carrying value of held-to-maturity securities pledged to secure public funds, trust deposits, repurchase agreements and for other purposes, as required or permitted by law was $811.4 million and $256.3 million at September 30, 2023 and December 31, 2022, respectively. Accrued interest receivable on held-to-maturity securities totaled $22.9 million and $30.2 million at September 30, 2023 and December 31, 2022, respectively and is included in accrued interest receivable and other assets in the accompanying consolidated balance sheets.

From time to time, we have reclassified certain securities from available for sale to held to maturity. The net unamortized, unrealized gain remaining on transferred securities included in accumulated other comprehensive income in the accompanying balance sheet totaled $1.3 million ($1.0 million, net of tax) at September 30, 2023 and $1.8 million ($1.4 million, net of tax) at December 31, 2022. This amount will be amortized out of accumulated other comprehensive income over the remaining life of the underlying securities as an adjustment of the yield on those securities.


	States and Political Subdivisions
	Not Guaranteed or Pre-Refunded		Guaranteed by the Texas PSF		Guaranteed by Third Party		Pre-Refunded		Total		Other Securities
September 30, 2023
Aaa/AAA	$	301,822	$	1,542,919	$	13,653	$	1,091	$	1,859,485	$	—
Aa/AA	503,190		—		6,103		—		509,293		—

Not rated	—		—		—		—		—		1,500
Total	$	805,012	$	1,542,919	$	19,756	$	1,091	$	2,368,778	$	1,500
December 31, 2022
Aaa/AAA	$	273,201	$	1,422,442	$	—	$	121,961	$	1,817,604	$	—
Aa/AA	294,015		—		—		—		294,015		—

Not rated	—		—		—		—		—		1,500
Total	$	567,216	$	1,422,442	$	—	$	121,961	$	2,111,619	$	1,500


	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Allowance for Credit Losses		Estimated Fair Value
September 30, 2023
U.S. Treasury	$	5,459,758	$	—	$	416,606	$	—	$	5,043,152

Residential mortgage-backed securities	7,589,404		140		1,282,910		—		6,306,634
States and political subdivisions	5,237,185		—		512,552		—		4,724,633
Other	42,670		—		—		—		42,670
Total	$	18,329,017	$	140	$	2,212,068	$	—	$	16,117,089
December 31, 2022
U.S. Treasury	$	5,450,546	$	—	$	398,959	$	—	$	5,051,587

Residential mortgage-backed securities	7,316,824		8,050		948,638		—		6,376,236
States and political subdivisions	7,098,635		9,108		334,388		—		6,773,355
Other	42,427		—		—		—		42,427
Total	$	19,908,432	$	17,158	$	1,681,985	$	—	$	18,243,605

All mortgage-backed securities included in the above table were issued by U.S. government agencies and corporations. At September 30, 2023, all of the securities in our available for sale municipal bond portfolio were issued by the State of Texas or political subdivisions or agencies within the State of Texas, of which approximately 73.3% are either guaranteed by the Texas Permanent School Fund (“PSF”) or have been pre-refunded. Securities with limited marketability, such as stock in the Federal Reserve Bank and the Federal Home Loan Bank, are carried at cost and are reported as other available for sale securities in the table above. The carrying value of available-for-sale securities pledged to secure public funds, trust deposits, repurchase agreements and for other purposes, as required or permitted by law was $4.8 billion and $8.0 billion at September 30, 2023 and December 31, 2022, respectively. Accrued interest receivable on available-for-sale securities totaled $82.4 million and $140.6 million at September 30, 2023 and December 31, 2022, respectively, and is included in accrued interest receivable and other assets in the accompanying consolidated balance sheets.

The table below summarizes, as of September 30, 2023, securities available for sale in an unrealized loss position for which an allowance for credit losses has not been recorded, aggregated by type of security and length of time in a continuous unrealized loss position.


	Less than 12 Months				More than 12 Months				Total
	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
U.S. Treasury	$	—	$	—	$	5,043,152	$	416,606	$	5,043,152	$	416,606
Residential mortgage-backed securities	1,486,570		67,981		4,806,198		1,214,929		6,292,768		1,282,910
States and political subdivisions	2,247,673		79,479		2,476,343		433,073		4,724,016		512,552
Total	$	3,734,243	$	147,460	$	12,325,693	$	2,064,608	$	16,059,936	$	2,212,068

As of September 30, 2023, no allowance for credit losses has been recognized on available for sale securities in an unrealized loss position as management does not believe any of the securities are impaired due to reasons of credit quality. This is based upon our analysis of the underlying risk characteristics, including credit ratings, and other qualitative factors related to our available for sale securities and in consideration of our historical credit loss experience and internal forecasts. The issuers of these securities continue to make timely principal and interest payments under the contractual terms of the securities. Furthermore, management does not have the intent to sell any of the securities classified as available for sale in the table above and believes that it is more likely than not that we will not have to sell any such securities before a recovery of cost. The

unrealized losses are due to increases in market interest rates over the yields available at the time the underlying securities were purchased. The fair value is expected to recover as the securities approach their maturity date or repricing date or if market yields for such investments decline.

Contractual Maturities. The following table summarizes the maturity distribution schedule of securities held to maturity and securities available for sale as of September 30, 2023. Mortgage-backed securities are included in maturity categories based on their stated maturity date. Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations. Other securities classified as available for sale include stock in the Federal Reserve Bank and the Federal Home Loan Bank, which have no maturity date. These securities have been included in the total column only.


	Within 1 Year		1 - 5 Years		5 - 10 Years		After 10 Years		Total
Held To Maturity
Amortized Cost

Residential mortgage-backed securities	$	—	$	—	$	513,264	$	744,891	$	1,258,155
States and political subdivisions	7,867		12,052		52,210		2,296,649		2,368,778
Other	—		1,500		—		—		1,500
Total	$	7,867	$	13,552	$	565,474	$	3,041,540	$	3,628,433
Estimated Fair Value

Residential mortgage-backed securities	$	—	$	—	$	439,829	$	705,184	$	1,145,013
States and political subdivisions	7,863		11,880		47,029		2,018,469		2,085,241
Other	—		1,437		—		—		1,437
Total	$	7,863	$	13,317	$	486,858	$	2,723,653	$	3,231,691
Available For Sale
Amortized Cost
U. S. Treasury	$	1,285,709	$	2,794,385	$	1,187,343	$	192,321	$	5,459,758
Residential mortgage-backed securities	772		3,593		15,131		7,569,908		7,589,404
States and political subdivisions	249,063		188,612		861,578		3,937,932		5,237,185
Other	—		—		—		—		42,670
Total	$	1,535,544	$	2,986,590	$	2,064,052	$	11,700,161	$	18,329,017
Estimated Fair Value
U. S. Treasury	$	1,269,227	$	2,633,956	$	1,011,055	$	128,914	$	5,043,152
Residential mortgage-backed securities	739		3,486		14,979		6,287,430		6,306,634
States and political subdivisions	247,660		184,085		802,922		3,489,966		4,724,633
Other	—		—		—		—		42,670
Total	$	1,517,626	$	2,821,527	$	1,828,956	$	9,906,310	$	16,117,089


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Proceeds from sales	$	360,712	$	—	$	1,904,067	$	—
Gross realized gains	341		—		5,758		—
Gross realized losses	(329)		—		(5,692)		—
Tax (expense) benefit of securities gains/losses	(3)		—		(14)		—


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Premium amortization	$	(19,367)	$	(27,165)	$	(66,534)	$	(84,278)
Discount accretion	5,672		4,062		15,920		7,950
Net (premium amortization) discount accretion	$	(13,695)	$	(23,103)	$	(50,614)	$	(76,328)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Net gain on sales transactions	$	1,093	$	1,110	$	2,964	$	2,462
Net mark-to-market gains (losses)	(25)		9		(52)		(235)
Net gain (loss) on trading account securities	$	1,068	$	1,119	$	2,912	$	2,227