Investment Securities

9 Months Ended

Sep. 30, 2021

Investments, Debt and Equity Securities [Abstract]

INVESTMENT SECURITIES (In Thousands)

The following table is the schedule of Available-For-Sale Securities at September 30, 2021, December 31, 2020 and September 30, 2020:


Available-For-Sale Securities
	U.S. Government & Agency Obligations		State and Municipal Obligations		Mortgage- Backed Securities		Corporate and Other Debt Securities		Total Available- For-Sale Securities
September 30, 2021
Available-For-Sale Securities, at Amortized Cost	$	110,001	$	400	$	373,042	$	1,000	$	484,443
Gross Unrealized Gains	96		—		5,225		—		5,321
Gross Unrealized Losses	(792)		—		(1,872)		(200)		(2,864)
Available-For-Sale Securities, at Fair Value	109,305		400		376,395		800		486,900
Available-For-Sale Securities, Pledged as Collateral, at Fair Value									361,014

Maturities of Debt Securities, at Amortized Cost:
Within One Year	$	—	$	—	$	125	$	—	$	125
From 1 - 5 Years	110,001		40		368,296		—		478,337
From 5 - 10 Years	—		360		4,621		1,000		5,981
Over 10 Years	—		—		—		—		—

Maturities of Debt Securities, at Fair Value:
Within One Year	$	—	$	—	$	132	$	—	$	132
From 1 - 5 Years	109,305		40		371,649		—		480,994
From 5 - 10 Years	—		360		4,614		800		5,774
Over 10 Years	—		—		—		—		—

Securities in a Continuous Loss Position, at Fair Value:
Less than 12 Months	$	74,695	$	—	$	190,532	$	—	$	265,227
12 Months or Longer	29,513		—		—		800		30,313
Total	$	104,208	$	—	$	190,532	$	800	$	295,540
Number of Securities in a Continuous Loss Position	14		—		27		1		42

Unrealized Losses on Securities in a Continuous Loss Position:
Less than 12 Months	$	305	$	—	$	1,872	$	—	$	2,177
12 Months or Longer	487		—		—		200		687
Total	$	792	$	—	$	1,872	$	200	$	2,864

Disaggregated Details:


US Agency Obligations, at Amortized Cost	$	110,001
US Agency Obligations, at Fair Value	109,305
US Government Agency Securities, at Amortized Cost					$	10,119
US Government Agency Securities, at Fair Value					10,165
Government Sponsored Entity Securities, at Amortized Cost					362,923
Government Sponsored Entity Securities, at Fair Value					366,230


Available-For-Sale Securities
	U.S. Government & Agency Obligations		State and Municipal Obligations		Mortgage- Backed Securities		Corporate and Other Debt Securities		Total Available- For-Sale Securities
December 31, 2020
Available-For-Sale Securities, at Amortized Cost	$	65,002	$	528	$	290,967	$	1,000	$	357,497
Gross Unrealized Gains	184		—		7,934		—		8,118
Gross Unrealized Losses	(74)		—		(54)		(200)		(328)
Available-For-Sale Securities, at Fair Value	65,112		528		298,847		800		365,287
Available-For-Sale Securities, Pledged as Collateral, at Fair Value									244,411

Securities in a Continuous Loss Position, at Fair Value:
Less than 12 Months	$	29,926	$	—	$	—	$	—	$	29,926
12 Months or Longer	—		—		4,882		800		5,682
Total	$	29,926	$	—	$	4,882	$	800	$	35,608
Number of Securities in a Continuous Loss Position	4		—		1		1		6

Unrealized Losses on Securities in a Continuous Loss Position:
Less than 12 Months	$	74	$	—	$	—	$	—	$	74
12 Months or Longer	—		—		54		200		254
Total	$	74	$	—	$	54	$	200	$	328

Disaggregated Details:


US Agency Obligations, at Amortized Cost	$	65,002
US Agency Obligations, at Fair Value	65,112
US Government Agency Securities, at Amortized Cost					$	12,696
US Government Agency Securities, at Fair Value					12,683
Government Sponsored Entity Securities, at Amortized Cost					278,271
Government Sponsored Entity Securities, at Fair Value					286,164


Available-For-Sale Securities
	U.S. Government & Agency Obligations		State and Municipal Obligations		Mortgage- Backed Securities		Corporate and Other Debt Securities		Total Available- For-Sale Securities
September 30, 2020
Available-For-Sale Securities, at Amortized Cost	$	35,001	$	593	$	329,887	$	1,000	$	366,481
Gross Unrealized Gains	184		—		8,700		—		8,884
Gross Unrealized Losses	(18)		—		(219)		(200)		(437)
Available-For-Sale Securities, at Fair Value	35,167		593		338,368		800		374,928
Available-For-Sale Securities, Pledged as Collateral, at Fair Value									308,879

Securities in a Continuous Loss Position, at Fair Value:
Less than 12 Months	$	29,982	$	—	$	13,847	$	—	$	43,829
12 Months or Longer	—		—		54,239		800		55,039
Total	$	29,982	$	—	$	68,086	$	800	$	98,868
Number of Securities in a Continuous Loss Position	4		—		26		1		31

Unrealized Losses on Securities in a Continuous Loss Position:
Less than 12 Months	$	18	$	—	$	36	$	—	$	54
12 Months or Longer	—		—		183		200		383
Total	$	18	$	—	$	219	$	200	$	437

Disaggregated Details:


US Agency Obligations, at Amortized Cost	$	35,001
US Agency Obligations, at Fair Value	35,167
US Government Agency Securities, at Amortized Cost					$	69,575
US Government Agency Securities, at Fair Value					69,407
Government Sponsored Entity Securities, at Amortized Cost					260,312
Government Sponsored Entity Securities, at Fair Value					268,961

At September 30, 2021, there was no allowance for credit losses for the available for sale securities portfolio.

The following table is the schedule of Held-To-Maturity Securities at September 30, 2021, December 31, 2020 and September 30, 2020:


Held-To-Maturity Securities
	State and Municipal Obligations		Mortgage- Backed Securities		Total Held-To Maturity Securities
September 30, 2021
Held-To-Maturity Securities, at Amortized Cost	$	179,952	$	18,385	$	198,337
Gross Unrealized Gains	4,834		765		5,599
Gross Unrealized Losses	—		—		—
Held-To-Maturity Securities, at Fair Value	184,786		19,150		203,936
Held-To-Maturity Securities, Pledged as Collateral, at Fair Value					192,929

Maturities of Debt Securities, at Amortized Cost:
Within One Year	$	23,281	$	940	$	24,221
From 1 - 5 Years	140,014		17,445		157,459
From 5 - 10 Years	15,791		—		15,791
Over 10 Years	866		—		866

Maturities of Debt Securities, at Fair Value:
Within One Year	$	23,448	$	959	$	24,407
From 1 - 5 Years	143,994		18,191		162,185
From 5 - 10 Years	16,473		—		16,473
Over 10 Years	871		—		871

Securities in a Continuous Loss Position, at Fair Value:
Less than 12 Months	$	—	$	—	$	—
12 Months or Longer	—		—		—
Total	$	—	$	—	$	—

Number of Securities in a Continuous Loss Position	—		—		—

Unrealized Losses on Securities in a Continuous Loss Position:
Less than 12 Months	$	—	$	—	$	—
12 Months or Longer	—		—		—
Total	$	—	$	—	$	—

Disaggregated Details:
US Government Agency Securities, at Amortized Cost			$	6,302
US Government Agency Securities, at Fair Value			6,506
Government Sponsored Entity Securities, at Amortized Cost			12,083
Government Sponsored Entity Securities, at Fair Value			12,644


Held-To-Maturity Securities
	State and Municipal Obligations		Mortgage- Backed Securities		Total Held-To Maturity Securities
December 31, 2020
Held-To-Maturity Securities, at Amortized Cost	$	192,352	$	26,053	$	218,405
Gross Unrealized Gains	7,080		1,094		8,174
Gross Unrealized Losses	(3)		—		(3)
Held-To-Maturity Securities, at Fair Value	199,429		27,147		226,576
Held-To-Maturity Securities, Pledged as Collateral, at Fair Value					211,176

Securities in a Continuous Loss Position, at Fair Value:
Less than 12 Months	$	1,513	$	—	$	1,513
12 Months or Longer	—		—		—
Total	$	1,513	$	—	$	1,513
Number of Securities in a Continuous Loss Position	4		—		4

Unrealized Losses on Securities in a Continuous Loss Position:
Less than 12 Months	$	3	$	—	$	3
12 Months or Longer	—		—		—
Total	$	3	$	—	$	3

Disaggregated Details:
US Government Agency Securities, at Amortized Cost			$	9,440
US Government Agency Securities, at Fair Value			9,762
Government Sponsored Entity Securities, at Amortized Cost			16,613
Government Sponsored Entity Securities, at Fair Value			17,385


Held-To-Maturity Securities
	State and Municipal Obligations		Mortgage- Backed Securities		Total Held-To Maturity Securities
September 30, 2020
Held-To-Maturity Securities, at Amortized Cost	$	195,735	$	29,064	$	224,799
Gross Unrealized Gains	7,488		1,257		8,745
Gross Unrealized Losses	(43)		—		(43)
Held-To-Maturity Securities, at Fair Value	203,180		30,321		233,501
Held-To-Maturity Securities, Pledged as Collateral, at Fair Value					221,844

Securities in a Continuous Loss Position, at Fair Value:
Less than 12 Months	$	1,476	$	—	$	1,476
12 Months or Longer	—		—		—
Total	$	1,476	$	—	$	1,476
Number of Securities in a Continuous Loss Position	4		—		4

Unrealized Losses on Securities in a Continuous Loss Position:
Less than 12 Months	$	42	$	—	$	42
12 Months or Longer	1		—		1
Total	$	43	$	—	$	43


Disaggregated Details:
US Government Agency Securities, at Amortized Cost			$	10,669
US Government Agency Securities, at Fair Value			11,049
Government Sponsored Entity Securities, at Amortized Cost			18,392
Government Sponsored Entity Securities, at Fair Value			19,272

In the tables above, maturities of mortgage-backed securities are included based on their expected average lives. Actual maturities will differ because issuers may have the right to call or prepay obligations with or without prepayment penalties.

Securities in a continuous loss position, in the tables above for September 30, 2021, December 31, 2020 and September 30, 2020, do not reflect any deterioration of the credit worthiness of the issuing entities.

Arrow evaluates available-for-sale debt securities in unrealized loss positions at each measurement date to determine whether the decline in the fair value below the amortized cost basis (impairment) is due to credit-related factors or noncredit-related factors. Any impairment that is not credit related is recognized in other comprehensive income, net of applicable taxes. Credit-related impairment is recognized within the allowance for credit losses on the balance sheet, limited to the amount by which the amortized cost basis exceeds the fair value, with a corresponding adjustment to earnings via credit loss expense. Arrow determined that at September 30, 2021, gross unrealized losses were primarily attributable to changes in interest rates, relative to when the investment securities were purchased, and not due to the credit quality of the investment securities. Arrow does not intend to sell, nor is it more likely than not that Arrow will be required to sell the security before recovery of its amortized cost basis, which may be at maturity. Therefore, Arrow carried no allowance for credit loss at September 30, 2021 and there was no credit loss expense recognized by Arrow with respect to the securities portfolio during the three months ended September 30, 2021.

Arrow's held to maturity debt securities are comprised of U.S. government agencies, U.S. government-sponsored enterprises or state and municipal obligations. U.S. government agencies and U.S. government-sponsored enterprise securities carry the explicit and/or implicit guarantee of the U.S. government, are widely recognized as “risk free,” and have a long history of zero credit loss. Arrow determined that the expected credit loss on its held to maturity debt portfolio was immaterial and therefore no allowance for credit loss was recorded as of September 30, 2021.

The following table is the schedule of Equity Securities at September 30, 2021, December 31, 2020 and September 30, 2020:

Equity Securities

September 30, 2021

December 31, 2020

September 30, 2020

Equity Securities, at Fair Value

$1,886

$1,636

$1,511

The following is a summary of realized and unrealized gains and losses recognized in net income on equity securities during the three and nine month period ended September 30, 2021 and 2020:


	For the Three Months Ended September 30,		For the Nine Months Ended September 30,
	2021		2020		2021		2020
Net (Loss) Gain on Equity Securities	$	(106)	$	(72)	$	250	$	(552)
Less: Net (loss) gain recognized during the reporting period on equity securities sold during the period	—		—		—		—
Unrealized net (loss) gain recognized during the reporting period on equity securities still held at the reporting date	$	(106)	$	(72)	$	250	$	(552)