XML 79 R11.htm IDEA: XBRL DOCUMENT v3.19.3
INVESTMENTS
 9 Months Ended
Sep. 30, 2019
Investments, Debt and Equity Securities [Abstract]  
INVESTMENTS INVESTMENTS

For the three months ended September 30, 2019, there were sales of $284.9 million of AFS securities with $1.2 million in gross realized gains and $1.1 million gross realized losses. For the three months ended September 30, 2018, proceeds on the sale of $43.3 million of AFS securities resulted in gross gains and losses of $0.3 million and $0.4 million, respectively.

For the nine months ended September 30, 2019, there were sales of $400.5 million of AFS securities with $1.9 million in gross realized gains and $1.8 million gross realized losses. In conjunction with the adoption of ASU 2017-12 in the first quarter of
2019, First Financial reclassified $268.7 million of HTM securities to AFS resulting in a $0.2 million realized loss recorded in the Consolidated Statement of Income. For the nine months ended September 30, 2018, proceeds on the sale of $259.5 million of AFS securities resulted in gross gains and losses of $0.3 million and $0.5 million. To align with post-merger investment strategies, during the second quarter of 2018 First Financial reclassified $367.9 million of HTM securities to AFS and sold certain securities.

The following is a summary of HTM and AFS investment securities as of September 30, 2019:
  
 
Held-to-maturity
 
Available-for-sale
(Dollars in thousands)
 
Amortized
cost
 
Unrecognized gain
 
Unrecognized loss
 
Fair
value
 
Amortized
cost
 
Unrealized
gain
 
Unrealized
loss
 
Fair
value
U.S. Treasuries
 
$
0

 
$
0

 
$
0

 
$
0

 
$
99

 
$
1

 
$
0

 
$
100

Securities of U.S. government agencies and corporations
 
0

 
0

 
0

 
0

 
156

 
3

 
0

 
159

Mortgage-backed securities - residential
 
22,367

 
184

 
(41
)
 
22,510

 
416,446

 
9,679

 
(103
)
 
426,022

Mortgage-backed securities - commercial
 
104,586

 
1,105

 
(828
)
 
104,863

 
440,457

 
6,929

 
(2,052
)
 
445,334

Collateralized mortgage obligations
 
10,545

 
0

 
(118
)
 
10,427

 
799,072

 
20,067

 
(208
)
 
818,931

Obligations of state and other political subdivisions
 
11,280

 
705

 
(61
)
 
11,924

 
588,634

 
25,140

 
(61
)
 
613,713

Asset-backed securities
 
0

 
0

 
0

 
0

 
465,542

 
1,652

 
(1,107
)
 
466,087

Other securities
 
0

 
0

 
0

 
0

 
78,745

 
1,654

 
(243
)
 
80,156

Total
 
$
148,778

 
$
1,994

 
$
(1,048
)
 
$
149,724

 
$
2,789,151

 
$
65,125

 
$
(3,774
)
 
$
2,850,502


The following is a summary of HTM and AFS investment securities as of December 31, 2018:
  
 
Held-to-maturity
 
Available-for-sale
(Dollars in thousands)
 
Amortized
cost
 
Unrecognized gain
 
Unrecognized
loss
 
Fair
value
 
Amortized
cost
 
Unrealized
gain
 
Unrealized
loss
 
Fair
value
U.S. Treasuries
 
$
0

 
$
0

 
$
0

 
$
0

 
$
99

 
$
0

 
$
(2
)
 
$
97

Securities of U.S. government agencies and corporations
 
0

 
0

 
0

 
0

 
32,095

 
57

 
(233
)
 
31,919

Mortgage-backed securities - residential
 
25,565

 
0

 
(1,045
)
 
24,520

 
565,071

 
691

 
(7,163
)
 
558,599

Mortgage-backed securities - commercial
 
147,780

 
258

 
(4,385
)
 
143,653

 
423,797

 
819

 
(3,581
)
 
421,035

Collateralized mortgage obligations
 
12,540

 
0

 
(633
)
 
11,907

 
928,586

 
4,319

 
(6,158
)
 
926,747

Obligations of state and other political subdivisions
 
243,443

 
1,954

 
(1,359
)
 
244,038

 
257,300

 
2,554

 
(1,429
)
 
258,425

Asset-backed securities
 
0

 
0

 
0

 
0

 
511,430

 
611

 
(2,810
)
 
509,231

Other securities
 
0

 
0

 
0

 
0

 
73,948

 
358

 
(1,104
)
 
73,202

Total
 
$
429,328

 
$
2,212

 
$
(7,422
)
 
$
424,118

 
$
2,792,326

 
$
9,409

 
$
(22,480
)
 
$
2,779,255



The following table provides a summary of investment securities by contractual maturity as of September 30, 2019, except for residential and commercial mortgage-backed securities, collateralized mortgage obligations and asset-backed securities, which are shown as single totals due to the unpredictability of the timing in principal repayments.
 
 
Held-to-maturity
 
Available-for-sale
(Dollars in thousands)
 
Amortized
cost
 
Fair
value
 
Amortized
cost
 
Fair
value
By Contractual Maturity:
 
 
 
 
 
 
 
 
Due in one year or less
 
$
0

 
$
0

 
$
8,694

 
$
8,713

Due after one year through five years
 
0

 
0

 
48,276

 
49,127

Due after five years through ten years
 
4,321

 
4,830

 
147,357

 
152,333

Due after ten years
 
6,959

 
7,094

 
463,307

 
483,955

Mortgage-backed securities - residential
 
22,367

 
22,510

 
416,446

 
426,022

Mortgage-backed securities - commercial
 
104,586

 
104,863

 
440,457

 
445,334

Collateralized mortgage obligations
 
10,545

 
10,427

 
799,072

 
818,931

Asset-backed securities
 
0

 
0

 
465,542

 
466,087

Total
 
$
148,778

 
$
149,724

 
$
2,789,151

 
$
2,850,502



Unrealized gains and losses on debt securities are generally due to fluctuations in current market yields relative to the yields of the debt securities at their amortized cost. All securities with unrealized losses are reviewed quarterly to determine if any impairment is considered other than temporary, requiring a write-down to fair value. First Financial considers the percentage loss on a security, duration of the loss, average life or duration of the security, credit rating of the security and payment performance, as well as the Company's intent and ability to hold the security to maturity, when determining whether any impairment is other than temporary. At this time, First Financial does not intend to sell, and it is not more likely than not that the Company will be required to sell, debt securities temporarily impaired prior to maturity or recovery of the recorded value. First Financial had no other than temporary impairment related to its investment securities portfolio as of September 30, 2019 or December 31, 2018.

As of September 30, 2019, the Company's investment securities portfolio consisted of 1,284 securities, of which 119 were in an unrealized loss position. As of December 31, 2018, the Company's investment securities portfolio consisted of 1,417 securities, of which 504 were in an unrealized loss position.

The following tables provide the fair value and gross unrealized losses on investment securities in an unrealized loss position, aggregated by investment category and the length of time the individual securities have been in a continuous loss position:
 
 
September 30, 2019
 
 
Less than 12 months
 
12 months or more
 
Total
(Dollars in thousands)
 
Fair
value
 
Unrealized
loss
 
Fair
value
 
Unrealized
loss
 
Fair
value
 
Unrealized
loss
U.S. Treasuries
 
$
0

 
$
0

 
$
0

 
$
0

 
$
0

 
$
0

Securities of U.S. Government agencies and corporations
 
0

 
0

 
0

 
0

 
0

 
0

Mortgage-backed securities - residential
 
14,365

 
(45
)
 
11,851

 
(99
)
 
26,216

 
(144
)
Mortgage-backed securities - commercial
 
52,281

 
(60
)
 
89,681

 
(2,820
)
 
141,962

 
(2,880
)
Collateralized mortgage obligations
 
43,732

 
(107
)
 
29,908

 
(219
)
 
73,640

 
(326
)
Obligations of state and other political subdivisions
 
14,202

 
(44
)
 
6,714

 
(78
)
 
20,916

 
(122
)
Asset-backed securities
 
259,681

 
(824
)
 
40,776

 
(283
)
 
300,457

 
(1,107
)
Other securities
 
4,160

 
(10
)
 
5,525

 
(233
)
 
9,685

 
(243
)
Total
 
$
388,421

 
$
(1,090
)
 
$
184,455

 
$
(3,732
)
 
$
572,876

 
$
(4,822
)

 
 
December 31, 2018
 
 
Less than 12 months
 
12 months or more
 
Total
 
 
Fair
 
Unrealized
 
Fair
 
Unrealized
 
Fair
 
Unrealized
(Dollars in thousands)
 
value
 
loss
 
value
 
loss
 
value
 
loss
U.S. Treasuries
 
$
0

 
$
0

 
$
97

 
$
(2
)
 
$
97

 
$
(2
)
Securities of U.S. Government agencies and corporations
 
0

 
0

 
16,777

 
(233
)
 
16,777

 
(233
)
Mortgage-backed securities - residential
 
186,029

 
(935
)
 
264,795

 
(7,273
)
 
450,824

 
(8,208
)
Mortgage-backed securities - commercial
 
147,754

 
(369
)
 
232,363

 
(7,597
)
 
380,117

 
(7,966
)
Collateralized mortgage obligations
 
194,795

 
(1,546
)
 
240,514

 
(5,245
)
 
435,309

 
(6,791
)
Obligations of state and other political subdivisions
 
62,805

 
(299
)
 
86,644

 
(2,489
)
 
149,449

 
(2,788
)
Asset-backed securities
 
336,437

 
(2,312
)
 
37,105

 
(498
)
 
373,542

 
(2,810
)
Other securities
 
33,752

 
(884
)
 
4,570

 
(220
)
 
38,322

 
(1,104
)
Total
 
$
961,572

 
$
(6,345
)
 
$
882,865

 
$
(23,557
)
 
$
1,844,437

 
$
(29,902
)


For further detail on the fair value of investment securities, see Note 16 – Fair Value Disclosures.