Investments

12 Months Ended

Dec. 31, 2024

INVESTMENTS

The aggregate carrying and approximate fair values of investment securities follow (in thousands). Fair values are based on quoted market prices, where available. If quoted market prices are not available, fair values are based on quoted market prices of comparable financial instruments.


	December 31, 2024								December 31, 2023
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Securities available-for-sale:
Obligations of states and
political subdivisions	$	199,131	$	139	$	15,519	$	183,751	$	228,456	$	371	$	16,089	$	212,738
Mortgage-backed securities:
U.S. government agencies	1,334,755		1,993		134,667		1,202,081		1,211,484		2,362		125,753		1,088,093
Private label	5,096		—		163		4,933		6,997		—		293		6,704
Trust preferred securities	4,605		141		—		4,746		4,599		—		321		4,278
Corporate securities	26,862		144		1,211		25,795		28,009		137		1,822		26,324
Total Securities
Available-for-Sale	$	1,570,449	$	2,417	$	151,560	$	1,421,306	$	1,479,545	$	2,870	$	144,278	$	1,338,137

The Company's other investment securities include marketable equity and non-marketable equity securities held for investment. At December 31, 2024 and 2023, the Company held $6.2 million and $7.5 million, respectively, in marketable equity securities, respectively. Changes in the fair value of the marketable equity securities are recorded in "unrealized gain (losses) recognized on equity securities still held" in the Consolidated Statements of Income. The Company's non-marketable securities consist of securities with limited marketability, such as stock in the Federal Reserve Bank ("FRB") or the Federal Home Loan Bank ("FHLB"). At December 31, 2024 and 2023, the Company held $23.6 million and $23.5 million, respectively, in non-marketable equity securities. These securities are carried at cost due to the restrictions placed on their transferability. The Company held no certificates of deposits for investment at December 31, 2024 and 2023.

The majority of the Company’s investment securities are mortgage-backed securities. These securities are collateralized by both residential and commercial properties. The mortgage-backed securities in which the Company has invested are predominantly issued by government-sponsored agencies such as Fannie Mae, Freddie Mac, and Ginnie Mae. At December 31, 2024 and 2023, there were no securities of any non-governmental issuer whose aggregate carrying value or estimated fair value exceeded 10% of shareholders' equity.

Certain investment securities owned by the Company were in an unrealized loss position (i.e., amortized cost basis exceeded the estimated fair value of the securities) as of December 31, 2024 and 2023. The following table shows the gross unrealized losses and fair value of the Company’s investments aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position (in thousands):


	December 31, 2024
	Less Than Twelve Months				Twelve Months or Greater				Total
	Estimated Fair Value		Unrealized Loss		Estimated Fair Value		Unrealized Loss		Estimated Fair Value		Unrealized Loss
Securities available-for-sale:
Obligations of states and political subdivisions	$	19,724	$	422	$	151,508	$	15,097	$	171,232	$	15,519
Mortgage-backed securities:
U.S. Government agencies	114,560		12,669		710,651		121,998		825,211		134,667
Private Label	—		—		4,933		163		4,933		163
Trust preferred securities	—		—		—		—		—		—
Corporate securities	—		—		24,035		1,211		24,035		1,211
Total available-for-sale	$	134,284	$	13,091	$	891,127	$	138,469	$	1,025,411	$	151,560


	December 31, 2023
	Less Than Twelve Months				Twelve Months or Greater				Total
	Estimated Fair Value		Unrealized Loss		Estimated Fair Value		Unrealized Loss		Estimated Fair Value		Unrealized Loss
Securities available-for-sale:
Obligations of states and political subdivisions	$	7,591	$	66	$	180,560	$	16,023	$	188,151	$	16,089
Mortgage-backed securities:
U.S. Government agencies	2,046		10,271		741,011		115,482		743,057		125,753
Private Label	—		—		4,738		293		4,738		293
Trust preferred securities	—		—		4,278		321		4,278		321
Corporate securities	—		—		24,609		1,822		24,609		1,822
Total available-for-sale	$	9,637	$	10,337	$	955,196	$	133,941	$	964,833	$	144,278

As of December 31, 2024, management does not intend to sell any impaired security and it is not more than likely that it will be required to sell any impaired security before the recovery of the amortized cost basis. The unrealized losses on debt securities are primarily the result of interest rate changes, credit spread fluctuations on agency-issued mortgage related securities, general financial market uncertainty and market volatility. These conditions should not prohibit the Company from receiving its contractual principal and interest payments on its debt securities. The fair value is expected to recover as the securities approach their maturity date or repricing date. As of December 31, 2024, management believes the unrealized losses detailed in the table above are temporary and no allowance for credit losses has been recognized in the Company’s securities. Should the impairment of any of these securities become other-than-temporary, the cost basis of the investment will be reduced and the resulting loss will be recognized in net income in the period the other-than-temporary impairment is identified, while any noncredit loss will be recognized in other comprehensive income.

The amortized cost and estimated fair value of debt securities at December 31, 2024, by contractual maturity, is shown in the following table (in thousands). Expected maturities will differ from contractual maturities because the issuers of the securities may have the right to prepay obligations without prepayment penalties. Mortgage-backed securities have been allocated to their respective maturity groupings based on their contractual maturity.


	Cost		Estimated Fair Value
Securities Available-for-Sale
Due in one year or less	$	15,521	$	15,409
Due after one year through five years	153,680		145,551
Due after five years through ten years	316,167		293,665
Due after ten years	1,085,081		966,681
	$	1,570,449	$	1,421,306

Proceeds from sales, gross gains and gross losses recognized by the Company from investment security transactions are summarized in the table below (in thousands):


	For the year ended December 31,
	2024		2023		2022
Proceeds on sales of available for sale securities	$	33,394	$	205,627	$	—

Gross unrealized gains recognized on equity securities still held	$	517	$	769	$	38
Gross unrealized losses recognized on equity securities still held	(342)		(337)		(1,623)
Net unrealized gains (losses) recognized on equity securities still held	$	175	$	432	$	(1,585)

Gross realized gains	$	5	$	996	$	4
Gross realized losses	(2,830)		(5,904)		—
Net realized investment security (losses) gains	$	(2,825)	$	(4,908)	$	4

During November 2023, the Company repositioned a portion of its investment portfolio and recorded sales of mortgage-backed securities that resulted in a pre-tax realized loss of $5.0 million. The carrying value of the securities sold on the Company's balance sheet was $107.4 million.

Similarly, during December 2024, the Company further repositioned a portion of its investment portfolio and recorded sales of non-taxable municipal securities and a mortgage-backed security that resulted in a pre-tax realized loss of $2.8 million. The carrying value of the securities sold on the Company's balance sheet was $36 million.

The carrying value of securities pledged to secure public deposits and for other purposes as required or permitted by law approximated $694 million and $709 million at December 31, 2024 and 2023, respectively.