Investment Securities

3 Months Ended

Mar. 31, 2024

Investments, Debt and Equity Securities [Abstract]

INVESTMENT SECURITIES (In Thousands)

The following table is the schedule of Available-For-Sale Securities at March 31, 2024, December 31, 2023 and March 31, 2023:


Available-For-Sale Securities
	U.S. Treasuries		U.S. Government & Agency Obligations		State and Municipal Obligations		Mortgage- Backed Securities		Corporate and Other Debt Securities		Total Available- For-Sale Securities
March 31, 2024
Available-For-Sale Securities, at Amortized Cost	$	74,190	$	160,000	$	280	$	294,858	$	1,000	$	530,328
Gross Unrealized Gains	4		39		—		13		—		56
Gross Unrealized Losses	(42)		(7,290)		—		(37,154)		(65)		(44,551)
Available-For-Sale Securities, at Fair Value	74,152		152,749		280		257,717		935		485,833
Available-For-Sale Securities, Pledged as Collateral, at Fair Value											310,587

Maturities of Debt Securities, at Amortized Cost:
Within One Year	$	49,263	$	30,000	$	—	$	2,555	$	—	$	81,818
From 1 - 5 Years	24,927		130,000		—		152,490		—		307,417
From 5 - 10 Years	—		—		280		139,813		1,000		141,093
Over 10 Years	—		—		—		—		—		—

Maturities of Debt Securities, at Fair Value:
Within One Year	$	49,260	$	29,498	$	—	$	2,491	$	—	$	81,249
From 1 - 5 Years	24,892		123,251		—		137,632		—		285,775
From 5 - 10 Years	—		—		280		117,594		935		118,809
Over 10 Years	—		—		—		—		—		—

Securities in a Continuous Loss Position, at Fair Value:
Less than 12 Months	$	49,287	$	—	$	—	$	71	$	—	$	49,358
12 Months or Longer	—		137,710		—		252,064		935		390,709
Total	$	49,287	$	137,710	$	—	$	252,135	$	935	$	440,067
Number of Securities in a Continuous Loss Position	2		19		—		98		1		120

Unrealized Losses on Securities in a Continuous Loss Position:
Less than 12 Months	$	42	$	—	$	—	$	—	$	—	$	42
12 Months or Longer	—		7,290		—		37,154		65		44,509
Total	$	42	$	7,290	$	—	$	37,154	$	65	$	44,551

Disaggregated Details:
US Treasuries, at Amortized Cost	$	74,190
US Treasuries, at Fair Value	74,152
US Agency Obligations, at Amortized Cost			$	160,000
US Agency Obligations, at Fair Value			152,749
Local Municipal Obligations, at Amortized Cost					$	280
Local Municipal Obligations, at Fair Value					280
US Government Agency Securities, at Amortized Cost							$	7,180


Available-For-Sale Securities
	U.S. Treasuries		U.S. Government & Agency Obligations		State and Municipal Obligations		Mortgage- Backed Securities		Corporate and Other Debt Securities		Total Available- For-Sale Securities
US Government Agency Securities, at Fair Value							6,843
Government Sponsored Entity Securities, at Amortized Cost							287,678
Government Sponsored Entity Securities, at Fair Value							250,874
Corporate Trust Preferred Securities, at Amortized Cost									$	1,000
Corporate Trust Preferred Securities, at Fair Value									935

December 31, 2023
Available-For-Sale Securities, at Amortized Cost	$	73,761	$	160,000	$	280	$	305,161	$	1,000	$	540,202
Gross Unrealized Gains	243		51		—		6		—		300
Gross Unrealized Losses	—		(7,126)		—		(35,407)		(200)		(42,733)
Available-For-Sale Securities, at Fair Value	74,004		152,925		280		269,760		800		497,769
Available-For-Sale Securities, Pledged as Collateral, at Fair Value											242,938

Securities in a Continuous Loss Position, at Fair Value:
Less than 12 Months	$	—	$	—	$	—	$	—	$	—	$	—
12 Months or Longer	—		137,874		—		269,286		800		407,960
Total	$	—	$	137,874	$	—	$	269,286	$	800	$	407,960
Number of Securities in a Continuous Loss Position	—		19		—		97		1		117

Unrealized Losses on Securities in a Continuous Loss Position:
Less than 12 Months	$	—	$	—	$	—	$	—	$	—	$	—
12 Months or Longer	—		7,126		—		35,407		200		42,733
Total	$	—	$	7,126	$	—	$	35,407	$	200	$	42,733

Disaggregated Details:


US Treasuries, at Amortized Cost	$	73,761
US Treasuries, at Fair Value	74,004
US Agency Obligations, at Amortized Cost			$	160,000
US Agency Obligations, at Fair Value			152,925
Local Municipal Obligations, at Amortized Cost					$	280
Local Municipal Obligations, at Fair Value					280
US Government Agency Securities, at Amortized Cost							$	7,291
US Government Agency Securities, at Fair Value							6,864
Government Sponsored Entity Securities, at Amortized Cost							297,870
Government Sponsored Entity Securities, at Fair Value							262,896
Corporate Trust Preferred Securities, at Amortized Cost									$	1,000


Available-For-Sale Securities
	U.S. Treasuries		U.S. Government & Agency Obligations		State and Municipal Obligations		Mortgage- Backed Securities		Corporate and Other Debt Securities		Total Available- For-Sale Securities
Corporate Trust Preferred Securities, at Fair Value									800



March 31, 2023
Available-For-Sale Securities, at Amortized Cost	$	—	$	190,000	$	320	$	431,754	$	1,000	$	623,074
Gross Unrealized Gains	—		—		—		160		—		160
Gross Unrealized Losses	—		(12,415)		—		(44,926)		(200)		(57,541)
Available-For-Sale Securities, at Fair Value	—		177,585		320		386,988		800		565,693
Available-For-Sale Securities, Pledged as Collateral, at Fair Value											360,153

Securities in a Continuous Loss Position, at Fair Value:
Less than 12 Months	$	—	$	54,058	$	—	$	27,106	$	—	$	81,164
12 Months or Longer	—		123,526		—		346,733		800		471,059
Total	$	—	$	177,584	$	—	$	373,839	$	800	$	552,223
Number of Securities in a Continuous Loss Position	—		25		—		150		1		176

Unrealized Losses on Securities in a Continuous Loss Position:
Less than 12 Months	$	—	$	942	$	—	$	891	$	—	$	1,833
12 Months or Longer	—		11,473		—		44,035		200		55,708
Total	$	—	$	12,415	$	—	$	44,926	$	200	$	57,541

Disaggregated Details:
US Treasury Obligations, at Amortized Cost	$	—
US Treasury Obligations, at Fair Value	—
US Agency Obligations, at Amortized Cost			$	190,000
US Agency Obligations, at Fair Value			177,585
Local Municipal Obligations, at Amortized Cost					$	320
Local Municipal Obligations, at Fair Value					320
US Government Agency Securities, at Amortized Cost							$	7,782
US Government Agency Securities, at Fair Value							7,321
Government Sponsored Entity Securities, at Amortized Cost							423,972
Government Sponsored Entity Securities, at Fair Value							379,667
Corporate Trust Preferred Securities, at Amortized Cost									$	1,000
Corporate Trust Preferred Securities, at Fair Value									800

At March 31, 2024, there was no allowance for credit losses for the AFS debt securities portfolio.

The following table is the schedule of Held-To-Maturity Securities at March 31, 2024, December 31, 2023 and March 31, 2023:


Held-To-Maturity Securities
	State and Municipal Obligations		Mortgage- Backed Securities		Total Held-To Maturity Securities
March 31, 2024
Held-To-Maturity Securities, at Amortized Cost	$	119,742	$	8,309	$	128,051

Gross Unrealized Losses	(2,794)		(396)		(3,190)
Held-To-Maturity Securities, at Fair Value	116,948		7,913		124,861
Held-To-Maturity Securities, Pledged as Collateral, at Carrying Value					112,135
Held-To-Maturity Securities, Pledged as Collateral, at Fair Value					108,945

Maturities of Debt Securities, at Amortized Cost:
Within One Year	$	47,680	$	—	$	47,680
From 1 - 5 Years	69,839		8,309		78,148
From 5 - 10 Years	2,217		—		2,217
Over 10 Years	6		—		6

Maturities of Debt Securities, at Fair Value:
Within One Year	$	47,387	$	—	$	47,387
From 1 - 5 Years	67,392		7,913		75,305
From 5 - 10 Years	2,163		—		2,163
Over 10 Years	6		—		6

Securities in a Continuous Loss Position, at Fair Value:
Less than 12 Months	$	1,143	$	—	$	1,143
12 Months or Longer	98,954		7,913		106,867
Total	$	100,097	$	7,913	$	108,010

Number of Securities in a Continuous Loss Position	308		16		324

Unrealized Losses on Securities in a Continuous Loss Position:
Less than 12 Months	$	17	$	—	$	17
12 Months or Longer	2,777		396		3,173
Total	$	2,794	$	396	$	3,190

Disaggregated Details:
Municipal Obligations, at Amortized Cost	$	119,742
Municipal Obligations, at Fair Value	116,948
US Government Agency Securities, at Amortized Cost			$	2,911


Held-To-Maturity Securities
	State and Municipal Obligations		Mortgage- Backed Securities		Total Held-To Maturity Securities
US Government Agency Securities, at Fair Value			2,766
Government Sponsored Entity Securities, at Amortized Cost			5,398
Government Sponsored Entity Securities, at Fair Value			5,147

December 31, 2023
Held-To-Maturity Securities, at Amortized Cost	$	122,450	$	8,945	$	131,395

Gross Unrealized Losses	(2,157)		(401)		(2,558)
Held-To-Maturity Securities, at Fair Value	120,293		8,544		128,837
Held-To-Maturity Securities, Pledged as Collateral, at Carrying Value					115,030
Held-To-Maturity Securities, Pledged as Collateral, at Fair Value					112,472

Securities in a Continuous Loss Position, at Fair Value:
Less than 12 Months	$	1,472	$	—	$	1,472
12 Months or Longer	102,839		8,544		111,383
Total	$	104,311	$	8,544	$	112,855
Number of Securities in a Continuous Loss Position	319		16		335

Unrealized Losses on Securities in a Continuous Loss Position:
Less than 12 Months	$	14	$	—	$	14
12 Months or Longer	2,143		402		2,545
Total	$	2,157	$	402	$	2,559

Disaggregated Details:
Municipal Obligations, at Amortized Cost	$	122,450
Municipal Obligations, at Fair Value	120,293
US Government Agency Securities, at Amortized Cost			$	3,114
US Government Agency Securities, at Fair Value			2,954
Government Sponsored Entity Securities, at Amortized Cost			5,831
Government Sponsored Entity Securities, at Fair Value			5,589

March 31, 2023
Held-To-Maturity Securities, at Amortized Cost	$	156,314	$	11,033	$	167,347
Gross Unrealized Gains	2		—		2
Gross Unrealized Losses	(2,421)		(489)		(2,910)
Held-To-Maturity Securities, at Fair Value	153,895		10,544		164,439


Held-To-Maturity Securities
	State and Municipal Obligations		Mortgage- Backed Securities		Total Held-To Maturity Securities
Held-To-Maturity Securities, Pledged as Collateral, at Carrying Value					149,810
Held-To-Maturity Securities, Pledged as Collateral, at Fair Value					146,902

Securities in a Continuous Loss Position, at Fair Value:
Less than 12 Months	$	43,121	$	—	$	43,121
12 Months or Longer	90,439		10,544		100,983
Total	$	133,560	$	10,544	$	144,104
Number of Securities in a Continuous Loss Position	386		16		402

Unrealized Losses on Securities in a Continuous Loss Position:
Less than 12 Months	$	496	$	—	$	496
12 Months or Longer	1,925		489		2,414
Total	$	2,421	$	489	$	2,910


Disaggregated Details:
Municipal Obligations, at Amortized Cost	$	156,314
Municipal Obligations, at Fair Value	153,895
US Government Agency Securities, at Amortized Cost			$	3,699
US Government Agency Securities, at Fair Value			3,522
Government Sponsored Entity Securities, at Amortized Cost			7,334
Government Sponsored Entity Securities, at Fair Value			7,022

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

Arrow's investment policy requires that investments held in our portfolio be investment grade or better at the time of purchase. Arrow performs an analysis of the creditworthiness of municipal obligations to determine if a security is of investment grade. The analysis may include but may not solely rely upon credit analysis conducted by external credit rating agencies.

Arrow evaluates AFS 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 non-credit-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 March 31, 2024, 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 any securities before recovery of its amortized cost basis, which may be at maturity. Therefore, Arrow carried no allowance for credit loss at March 31, 2024 and there was no credit loss expense recognized by Arrow with respect to the securities portfolio during the three months ended March 31, 2024.

Arrow's HTM debt securities are comprised of U.S. government-sponsored enterprises (GSEs) or state and municipal obligations. GSE 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 HTM debt portfolio was immaterial and therefore no allowance for credit loss was recorded as of March 31, 2024.

The following table is the schedule of Equity Securities at March 31, 2024, December 31, 2023 and March 31, 2023:

Equity Securities

March 31, 2024

December 31, 2023

March 31, 2023

Equity Securities, at Fair Value

$1,942

$1,925

$2,070

The following is a summary of realized and unrealized gains and losses recognized in net income on equity securities during the three and three month periods ended March 31, 2024 and 2023:


	For the Three Months Ended March 31,
	2024		2023
Net Gain (Loss) on Equity Securities	$	17	$	(104)
Less: Net gain recognized during the reporting period on equity securities sold during the period	—		—
Unrealized net gain (loss) recognized during the reporting period on equity securities still held at the reporting date	$	17	$	(104)