XML 22 R12.htm IDEA: XBRL DOCUMENT v3.24.2
Investment Securities
 6 Months Ended
Jun. 30, 2024
Investments, Debt and Equity Securities [Abstract]  
Investment Securities Investment Securities
Investment securities are designated as AFS, HTM, or equity on the consolidated balance sheets. The amortized cost and fair values of AFS and HTM securities at June 30, 2024 were as follows:
($ in thousands)Amortized
Cost		Gross
Unrealized
Gains		Gross
Unrealized
(Losses)		Fair Value
AFS investment securities
U.S. Treasury securities$39,986 $— $(4,349)$35,638 
Obligations of state and political subdivisions (municipal securities)82,876 — (4,369)78,507 
Residential mortgage-related securities:
FNMA/FHLMC1,224,824 172 (160,678)1,064,318 
GNMA2,450,628 3,725 (13,545)2,440,808 
Commercial mortgage-related securities:
FNMA/FHLMC18,513 — (1,230)17,283 
GNMA158,257 — (8,458)149,799 
Asset backed securities:
FFELP123,720 43 (998)122,765 
SBA667 — (27)640 
Other debt securities3,000 — (27)2,973 
Total AFS investment securities$4,102,470 $3,941 $(193,681)$3,912,730 
HTM investment securities
U.S. Treasury securities$1,000 $— $(22)$978 
Obligations of state and political subdivisions (municipal securities)1,668,494 1,411 (172,235)1,497,670 
Residential mortgage-related securities:
FNMA/FHLMC916,966 25,024 (188,333)753,657 
GNMA46,392 11 (3,866)42,536 
Private-label335,148 8,955 (70,211)273,892 
Commercial mortgage-related securities:
FNMA/FHLMC776,717 11,429 (157,363)630,783 
GNMA54,403 289 (7,256)47,436 
Total HTM investment securities$3,799,119 $47,119 $(599,286)$3,246,952 
The amortized cost and fair values of AFS and HTM securities at December 31, 2023 were as follows:
($ in thousands)Amortized
Cost		Gross
Unrealized
Gains		Gross
Unrealized
(Losses)		Fair Value
AFS investment securities
U.S. Treasury securities$39,984 $— $(4,083)$35,902 
Obligations of state and political subdivisions (municipal securities)94,008 23 (2,214)91,817 
Residential mortgage-related securities:
FNMA/FHLMC1,274,052 294 (153,552)1,120,794 
GNMA2,021,242 24,254 (2,822)2,042,675 
Commercial mortgage-related securities:
FNMA/FHLMC18,691 — (1,755)16,937 
GNMA161,928 — (7,135)154,793 
Asset backed securities:
FFELP135,832 5 (1,862)133,975 
SBA1,077 2 (28)1,051 
Other debt securities3,000 — (50)2,950 
Total AFS investment securities$3,749,814 $24,579 $(173,501)$3,600,892 
HTM investment securities
U.S. Treasury securities$999 $— $(36)$963 
Obligations of state and political subdivisions (municipal securities)1,682,473 5,638 (134,053)1,554,059 
Residential mortgage-related securities:
FNMA/FHLMC941,973 27,007 (164,587)804,393 
GNMA48,979 92 (2,901)46,170 
Private-label345,083 9,796 (65,372)289,507 
Commercial mortgage-related securities:
FNMA/FHLMC780,995 12,699 (160,781)632,914 
GNMA59,733 386 (7,500)52,619 
 Total HTM investment securities$3,860,235 $55,619 $(535,230)$3,380,624 
Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. The expected maturities of AFS and HTM securities at June 30, 2024, are shown below:
 AFSHTM
($ in thousands)Amortized
Cost		Fair
Value		Amortized
Cost		Fair
Value
Due in one year or less$2,000 $1,983 $6,288 $6,240 
Due after one year through five years51,062 45,997 61,651 60,374 
Due after five years through ten years45,931 42,937 175,169 166,153 
Due after ten years26,868 26,201 1,426,386 1,265,882 
Total debt securities125,862 117,118 1,669,494 1,498,648 
Residential mortgage-related securities:
FNMA/FHLMC1,224,824 1,064,318 916,966 753,657 
GNMA2,450,628 2,440,808 46,392 42,536 
Private-label— — 335,148 273,892 
Commercial mortgage-related securities:
FNMA/FHLMC18,513 17,283 776,717 630,783 
GNMA158,257 149,799 54,403 47,436 
Asset backed securities:
FFELP 123,720 122,765 — — 
SBA667 640 — — 
Total investment securities$4,102,470 $3,912,730 $3,799,119 $3,246,952 
Ratio of fair value to amortized cost95.4 %85.5 %
On a quarterly basis, the Corporation refreshes the credit quality of each HTM security. The following table summarizes the credit quality indicators of HTM securities at amortized cost at June 30, 2024:
($ in thousands)AAAAAANot RatedTotal
U.S. Treasury securities$1,000 $— $— $— $1,000 
Obligations of state and political subdivisions (municipal securities)766,531 894,406 5,494 2,063 1,668,494 
Residential mortgage-related securities:
FNMA/FHLMC916,966 — — — 916,966 
GNMA46,392 — — — 46,392 
Private-label335,148 — — — 335,148 
Commercial mortgage-related securities:
FNMA/FHLMC776,717 — — — 776,717 
GNMA 54,403 — — — 54,403 
Total HTM securities$2,897,156 $894,406 $5,494 $2,063 $3,799,119 
The following table summarizes the credit quality indicators of HTM securities at amortized cost at December 31, 2023:
($ in thousands)AAAAAANot RatedTotal
U.S. Treasury securities$999 $— $— $— $999 
Obligations of state and political subdivisions (municipal securities)760,329 915,303 5,687 1,155 1,682,473 
Residential mortgage-related securities:
FNMA/FHLMC941,973 — — — 941,973 
GNMA48,979 — — — 48,979 
Private-label345,083 — — — 345,083 
Commercial mortgage-related securities:
FNMA/FHLMC780,995 — — — 780,995 
GNMA 59,733 — — — 59,733 
Total HTM securities$2,938,090 $915,303 $5,687 $1,155 $3,860,235 
The following table summarizes gross realized gains and losses on AFS securities, the gain on sale and net write-up of equity securities, and proceeds from the sale of AFS investment securities for the three and six months ended June 30, 2024 and 2023:
Three Months Ended Jun 30,Six Months Ended Jun 30,
($ in thousands)2024202320242023
Gross realized (losses) on AFS securities$— $— $(197)$— 
Gain on sale and net write-up (down) of equity securities67 14 4,143 66 
Investment securities gains, net$67 $14 $3,947 $66 
Proceeds from sales of AFS investment securities$— $— $9,472 $— 
During the first quarter of 2024, the Corporation sold its remaining Visa Class B restricted shares at a gain of $4 million.
Investment securities with a carrying value of $1.3 billion and $1.6 billion at June 30, 2024 and December 31, 2023, respectively, were pledged as required to secure certain deposits or for other purposes.
Accrued interest receivable on HTM securities totaled $18 million at both June 30, 2024 and December 31, 2023. Accrued interest receivable on AFS securities totaled $16 million and $15 million at June 30, 2024 and December 31, 2023, respectively. Accrued interest receivable on both HTM and AFS securities is included in interest receivable on the consolidated balance sheets.
The allowance for credit losses on HTM securities was approximately $84,000 at June 30, 2024 and approximately $75,000 at December 31, 2023, attributable entirely to the Corporation's municipal securities, included in HTM investment securities, net, at amortized cost on the consolidated balance sheets. The Corporation also holds U.S. Treasury, municipal, and mortgage-related securities issued by the U.S. government or a GSE which are backed by the full faith and credit of the U.S. government and private-label residential mortgage-related securities that have credit enhancement which covers the first 15% of losses and, as a result, no allowance for credit losses has been recorded related to these securities.
The following represents gross unrealized losses and the related fair value of AFS and HTM securities, aggregated by investment category and length of time individual securities have been in a continuous unrealized loss position, at June 30, 2024:
 Less than 12 months12 months or moreTotal
($ in thousands)Number
of
Securities		Unrealized
(Losses)		Fair
Value		Number
of
Securities		Unrealized
(Losses)		Fair
Value		Unrealized
(Losses)		Fair
Value
AFS investment securities
U.S. Treasury securities— $— $— 1 $(4,349)$35,638 $(4,349)$35,638 
Obligations of state and political subdivisions (municipal securities)25 (383)11,594 112 (3,986)65,278 (4,369)76,872 
Residential mortgage-related securities:
FNMA/FHLMC17 (373)25,524 87 (160,306)1,025,295 (160,678)1,050,819 
GNMA75 (8,837)1,396,637 18 (4,709)167,297 (13,545)1,563,934 
Commercial mortgage-related securities:
FNMA/FHLMC— — — 1 (1,230)17,283 (1,230)17,283 
GNMA— — — 31 (8,458)149,799 (8,458)149,799 
Asset backed securities:
FFELP2 (72)38,384 12 (925)71,409 (998)109,792 
SBA— — — 5 (27)612 (27)612 
Other debt securities— — — 3 (27)2,973 (27)2,973 
Total119 $(9,664)$1,472,139 270 $(184,017)$1,535,583 $(193,681)$3,007,721 
HTM investment securities
U.S. Treasury securities— $— $— 1 $(22)$978 $(22)$978 
Obligations of state and political subdivisions (municipal securities)360 (8,558)443,724 688 (163,676)929,232 (172,235)1,372,956 
Residential mortgage-related securities:
FNMA/FHLMC5 (52)2,581 114 (188,281)750,852 (188,333)753,432 
GNMA6 (138)8,508 80 (3,729)34,028 (3,866)42,536 
Private-label— — — 18 (70,211)273,892 (70,211)273,892 
 Commercial mortgage-related securities:
FNMA/FHLMC— — — 45 (157,363)630,783 (157,363)630,783 
GNMA— — — 13 (7,256)47,436 (7,256)47,436 
Total371 $(8,747)$454,813 959 $(590,538)$2,667,200 $(599,286)$3,122,012 
For comparative purposes, the following represents gross unrealized losses and the related fair value of AFS and HTM securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at December 31, 2023:
 Less than 12 months12 months or moreTotal
($ in thousands)Number
of
Securities		Unrealized
(Losses)		Fair
Value		Number
of
Securities		Unrealized
(Losses)		Fair
Value		Unrealized
(Losses)		Fair
Value
AFS investment securities
U.S. Treasury securities— $— $— 1 $(4,083)$35,902 $(4,083)$35,902 
Obligations of state and political subdivisions (municipal securities)41 (347)23,762 92 (1,867)53,022 (2,214)76,784 
Residential mortgage-related securities:
FNMA/FHLMC18 (333)22,870 71 (153,219)1,080,337 (153,552)1,103,207 
GNMA13 (924)156,847 5 (1,898)26,643 (2,822)183,490 
Commercial mortgage-related securities:
FNMA/FHLMC— — — 1 (1,755)16,937 (1,755)16,937 
GNMA9 (3,160)103,055 22 (3,975)51,738 (7,135)154,793 
Asset backed securities:
FFELP— — — 14 (1,862)125,339 (1,862)125,339 
SBA— — — 5 (28)761 (28)761 
Other debt securities1 (9)991 2 (42)1,958 (50)2,950 
Total82 $(4,773)$307,527 213 $(168,728)$1,392,635 $(173,501)$1,700,162 
HTM investment securities
U.S. Treasury securities— $— $— 1 $(36)$963 $(36)$963 
Obligations of state and political subdivisions (municipal securities)182 (1,535)180,270 537 (132,518)792,940 (134,053)973,210 
Residential mortgage-related securities:
FNMA/FHLMC20 (511)30,323 94 (164,076)771,042 (164,587)801,365 
GNMA2 (17)2,128 78 (2,884)34,626 (2,901)36,754 
Private-label— — — 18 (65,372)289,507 (65,372)289,507 
Commercial mortgage-related securities:
FNMA/FHLMC1 (121)8,144 44 (160,660)624,770 (160,781)632,914 
GNMA— — — 13 (7,500)52,619 (7,500)52,619 
Total205 $(2,184)$220,865 785 $(533,046)$2,566,468 $(535,230)$2,787,333 
The Corporation reviews the AFS investment securities portfolio on a quarterly basis to monitor its credit exposure. A determination as to whether a security’s decline in fair value is the result of credit risk takes into consideration numerous factors and the relative significance of any single factor can vary by security. Some factors the Corporation may consider in this impairment analysis include the extent to which the security has been in an unrealized loss position, the change in security rating, financial condition and near-term prospects of the issuer, as well as the security and industry specific economic conditions.
Based on the Corporation’s evaluation, management does not believe any unrealized losses at June 30, 2024 represent credit deterioration as these unrealized losses are primarily attributable to changes in interest rates and the current market conditions. As of June 30, 2024, the Corporation does not intend to sell, nor does it believe that it will be required to sell, the securities in an unrealized loss position before recovery of their amortized cost basis.
FHLB and Federal Reserve Bank stocks: The Corporation is required to maintain Federal Reserve Bank stock and FHLB stock as a member bank of both the Federal Reserve System and the FHLB, and in amounts as required by these institutions. These equity securities are “restricted” in that they can only be sold back to the respective institutions or another member institution at par. Therefore, they are less liquid than other marketable equity securities and their fair value is equal to amortized cost. The Corporation had FHLB stock of $124 million and $143 million at June 30, 2024 and December 31, 2023, respectively. The Corporation had Federal Reserve Bank stock of $88 million and $87 million at June 30, 2024 and December 31, 2023, respectively. Accrued interest receivable on FHLB stock totaled $3 million and $4 million at June 30, 2024 and December 31, 2023, respectively. There was no accrued interest receivable on Federal Reserve Bank Stock at both June 30, 2024 and December 31, 2023. Accrued interest receivable on both FHLB stock and Federal Reserve Bank stock is included in interest receivable on the consolidated balance sheets.
Equity Securities
Equity securities with readily determinable fair values: The Corporation's portfolio of equity securities with readily determinable fair values is primarily comprised of mutual funds. The Corporation had equity securities with readily determinable fair values of $10 million and $7 million at June 30, 2024 and December 31, 2023, respectively.
Equity securities without readily determinable fair values: The Corporation's portfolio of equity securities without readily determinable fair values primarily consists of an investment in a private loan fund. The Corporation had equity securities without readily determinable fair values carried at $13 million and $35 million at June 30, 2024 and December 31, 2023, respectively. During the first quarter of 2024, the Corporation sold all of its remaining Visa Class B restricted shares.