Equity securities carried at fair value totaled $36.5 million and $29.4 million at December 31, 2021 and 2020, respectively. At December 31, 2021, Valley's equity securities consisted of one publicly traded mutual fund, CRA investments and to a lesser extent, equity investments related to the development of new financial technologies. Valley's CRA and other equity investments are a mixture of both public traded entities and privately held entities without readily determinable fair market values.

The fair value of trading debt securities, wholly consisting of municipal bonds, totaled $38.1 million at December 31, 2021. We had no trading debt securities at December 31, 2020. Net trading gains were included in net gains and losses on securities transactions within non-interest income. See the "Realized Gains and Losses" section below.


	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(in thousands)
December 31, 2021

U.S. government agency securities	$	20,323	$	608	$	(6)	$	20,925
Obligations of states and political subdivisions:
Obligations of states and state agencies	26,088		132		(93)		26,127
Municipal bonds	53,530		349		(116)		53,763
Total obligations of states and political subdivisions	79,618		481		(209)		79,890
Residential mortgage-backed securities	895,279		14,986		(5,763)		904,502
Corporate and other debt securities	120,871		3,177		(556)		123,492
Total	$	1,116,091	$	19,252	$	(6,534)	$	1,128,809
December 31, 2020
U.S. Treasury securities	$	50,031	$	1,362	$	—	$	51,393
U.S. government agency securities	25,067		1,103		(13)		26,157
Obligations of states and political subdivisions:
Obligations of states and state agencies	40,861		970		(32)		41,799
Municipal bonds	37,489		731		(69)		38,151
Total obligations of states and political subdivisions	78,350		1,701		(101)		79,950
Residential mortgage-backed securities	1,050,369		40,426		(773)		1,090,022
Corporate and other debt securities	89,689		2,294		(32)		91,951
Total	$	1,293,506	$	46,886	$	(919)	$	1,339,473


	Less than Twelve Months				More than Twelve Months				Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(in thousands)
December 31, 2021

U.S. government agency securities	$	—	$	—	$	1,326	$	(6)	$	1,326	$	(6)
Obligations of states and political subdivisions:
Obligations of states and state agencies	10,549		(93)		—		—		10,549		(93)
Municipal bonds	19,100		(116)		—		—		19,100		(116)
Total obligations of states and political subdivisions	29,649		(209)		—		—		29,649		(209)
Residential mortgage-backed securities	371,256		(4,770)		25,960		(993)		397,216		(5,763)

Corporate and other debt securities	59,039		(556)		—		—		59,039		(556)
Total	$	459,944	$	(5,535)	$	27,286	$	(999)	$	487,230	$	(6,534)
December 31, 2020

U.S. government agency securities	$	—	$	—	$	1,479	$	(13)	$	1,479	$	(13)
Obligations of states and political subdivisions:
Obligations of states and state agencies	—		—		1,010		(32)		1,010		(32)
Municipal bonds	6,777		(69)		—		—		6,777		(69)
Total obligations of states and political subdivisions	6,777		(69)		1,010		(32)		7,787		(101)
Residential mortgage-backed securities	41,418		(500)		27,911		(273)		69,329		(773)

Corporate and other debt securities	12,517		(32)		—		—		12,517		(32)

Total	$	60,712	$	(601)	$	30,400	$	(318)	$	91,112	$	(919)

The contractual maturities of available for sale debt securities at December 31, 2021 are set forth in the following table. Maturities may differ from contractual maturities in residential mortgage-backed securities because the mortgages underlying the securities may be prepaid without any penalties. Therefore, residential mortgage-backed securities are not included in the maturity categories in the following summary.


	December 31, 2021
	Amortized Cost		Fair Value
	(in thousands)
Due in one year	$	7,057	$	7,121
Due after one year through five years	30,645		31,222
Due after five years through ten years	94,221		96,722
Due after ten years	88,889		89,242
Residential mortgage-backed securities	895,279		904,502

Total	$	1,116,091	$	1,128,809

Valley's available for sale debt securities portfolio includes corporate bonds and revenue bonds, among other securities. These types of securities may pose a higher risk of future impairment charges by Valley as a result of the unpredictable nature of the U.S. economy and its potential negative effect on the future performance of the security issuers, including due to the economic effects of the COVID-19 pandemic.

Available for sale debt securities in unrealized loss positions are evaluated for impairment related to credit losses on a quarterly basis. See Note 1 for further information regarding Valley's accounting policy. Valley has evaluated available for sale debt securities that are in an unrealized loss position as of December 31, 2021 included in the table above and has determined that the declines in fair value are mainly attributable to market volatility, not credit quality or other factors. Based on a comparison of the present value of expected cash flows to the amortized cost, management recognized no impairment during the years ended December 31, 2021 and 2020, respectively, and, as a result, there was no allowance for credit losses for available for sale debt securities at December 31, 2021 and 2020.


	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(in thousands)
December 31, 2021
U.S. Treasury securities	$	67,558	$	4,103	$	—	$	71,661
U.S. government agency securities	6,265		113		—		6,378
Obligations of states and political subdivisions:
Obligations of states and state agencies	141,015		3,065		(312)		143,768
Municipal bonds	196,947		3,536		(87)		200,396
Total obligations of states and political subdivisions	337,962		6,601		(399)		344,164
Residential mortgage-backed securities	2,166,142		14,599		(28,440)		2,152,301
Trust preferred securities	37,020		5		(5,109)		31,916
Corporate and other debt securities	53,750		559		(124)		54,185
Total	$	2,668,697	$	25,980	$	(34,072)	$	2,660,605
December 31, 2020
U.S. Treasury securities	$	68,126	$	7,358	$	—	$	75,484
U.S. government agency securities	6,222		291		—		6,513
Obligations of states and political subdivisions:
Obligations of states and state agencies	262,762		8,060		(105)		270,717
Municipal bonds	207,497		6,292		—		213,789
Total obligations of states and political subdivisions	470,259		14,352		(105)		484,506
Residential mortgage-backed securities	1,550,306		39,603		(254)		1,589,655
Trust preferred securities	37,348		50		(7,365)		30,033
Corporate and other debt securities	40,750		672		(1)		41,421
Total	$	2,173,011	$	62,326	$	(7,725)	$	2,227,612


	Less than Twelve Months				More than Twelve Months				Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(in thousands)
December 31, 2021


Obligations of states and political subdivisions:
Obligations of states and state agencies	$	17,000	$	(254)	$	5,517	$	(58)	$	22,517	$	(312)
Municipal bonds	9,403		(87)		—		—		9,403		(87)
Total obligations of states and political subdivisions	26,403		(341)		5,517		(58)		31,920		(399)
Residential mortgage-backed securities	1,381,405		(22,365)		206,520		(6,075)		1,587,925		(28,440)
Trust preferred securities	—		—		30,912		(5,109)		30,912		(5,109)
Corporate and other debt securities	32,627		(124)		—		—		32,627		(124)
Total	$	1,440,435	$	(22,830)	$	242,949	$	(11,242)	$	1,683,384	$	(34,072)
December 31, 2020



Obligations of states and state agencies	$	5,546	$	(105)	$	—	$	—	$	5,546	$	(105)


Residential mortgage-backed securities	21,599		(245)		2,470		(9)		24,069		(254)
Trust preferred securities	—		—		28,630		(7,365)		28,630		(7,365)
Corporate and other debt securities	10,749		(1)		—		—		10,749		(1)
Total	$	37,894	$	(351)	$	31,100	$	(7,374)	$	68,994	$	(7,725)

The contractual maturities of investments in debt securities held to maturity at December 31, 2021 are set forth in the table below. Maturities may differ from contractual maturities in residential mortgage-backed securities because the mortgages underlying the securities may be prepaid without any penalties. Therefore, residential mortgage-backed securities are not included in the maturity categories in the following summary.


	December 31, 2021
	Amortized Cost		Fair Value
	(in thousands)
Due in one year	$	34,034	$	34,197
Due after one year through five years	231,104		238,092
Due after five years through ten years	48,465		49,318
Due after ten years	188,952		186,697
Residential mortgage-backed securities	2,166,142		2,152,301
Total	$	2,668,697	$	2,660,605

Valley monitors the credit quality of the held to maturity debt securities utilizing the most current credit ratings from external rating agencies. The following table summarizes the amortized cost of held to maturity debt securities by external credit rating at December 31, 2021 and 2020.


	AAA/AA/A Rated		BBB rated		Non-investment grade rated		Non-rated		Total
	(in thousands)
December 31, 2021
U.S. Treasury securities	$	67,558	$	—	$	—	$	—	$	67,558
U.S. government agency securities	6,265		—		—		—		6,265
Obligations of states and political subdivisions:
Obligations of states and state agencies	118,368		—		5,576		17,071		141,015
Municipal bonds	148,854		—		—		48,093		196,947
Total obligations of states and political subdivisions	267,222		—		5,576		65,164		337,962
Residential mortgage-backed securities	2,166,142		—		—		—		2,166,142
Trust preferred securities	—		—		—		37,020		37,020
Corporate and other debt securities	2,000		6,000		—		45,750		53,750
Total	$	2,509,187	$	6,000	$	5,576	$	147,934	$	2,668,697
December 31, 2020
U.S. Treasury securities	$	68,126	$	—	$	—	$	—	$	68,126
U.S. government agency securities	6,222		—		—		—		6,222
Obligations of states and political subdivisions:
Obligations of states and state agencies	228,286		—		5,650		28,826		262,762
Municipal bonds	166,408		—		—		41,089		207,497
Total obligations of states and political subdivisions	394,694		—		5,650		69,915		470,259
Residential mortgage-backed securities	1,550,306		—		—		—		1,550,306
Trust preferred securities	—		—		—		37,348		37,348
Corporate and other debt securities	—		5,000		—		35,750		40,750
Total	$	2,019,348	$	5,000	$	5,650	$	143,013	$	2,173,011

Obligations of states and political subdivisions include municipal bonds and revenue bonds issued by various municipal corporations. At December 31, 2021, most of the obligations of states and political subdivisions were rated investment grade and a large portion of the "non-rated" category included TEMS securities secured by Ginnie Mae securities. Trust preferred securities consist of non-rated single-issuer securities, issued by bank holding companies. Corporate bonds consist of debt primarily issued by banks.

Valley has a zero loss expectation for certain securities within the held to maturity portfolio, and therefore it is not required to estimate an allowance for credit losses related to these securities under the CECL standard. After an evaluation of qualitative factors, Valley identified the following securities types which it believes qualify for this exclusion: U.S. Treasury securities, U.S. government agency securities, residential mortgage-backed securities issued by Ginnie Mae, Fannie Mae and Freddie Mac, and collateralized municipal bonds called TEMS. To measure the expected credit losses on held to maturity debt securities that have loss expectations, Valley estimates the expected credit losses using a discounted cash flow model developed by a third-party. See Note 1 for further details.


	2021		2020		2019
	(in thousands)
Sales transactions:
Gross gains	$	1,370	$	665	$	—
Gross losses	(550)		(9)		—
Total	$	820	$	656	$	—
Maturities and other securities transactions:
Gross gains	$	10	$	34	$	67
Gross losses	(285)		(166)		(217)
Total	(275)		(132)		(150)
Net gains on trading debt securities	1,213		—		—
Net gains (losses) on securities transactions	$	1,758	$	524	$	(150)

Net gains on sales transactions (as presented in the table above) include sales of available for sale debt securities related to $92.0 million of U.S. Treasury securities and residential mortgage-backed securities for the year ended December 31, 2021, and $30.0 million of certain municipal securities for the for the year ended December 31, 2020.