Investment Securities

12 Months Ended

Dec. 31, 2020

Investments, Debt and Equity Securities [Abstract]

The amortized cost and fair value of investments, which were classified as available for sale, are as follows:

As of December 31, 2020


(dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
U.S. Treasury securities	$	500,095	$	5	$	—	$	500,100
Obligations of the U.S. government and agencies	92,449		868		(219)		93,098
Obligations of state and political subdivisions	2,149		22		—		2,171
Mortgage-backed securities	441,575		12,739		(457)		453,857
Collateralized mortgage obligations	18,680		583		—		19,263
Collateralized loan obligations	94,500		1		(97)		94,404
Corporate bonds	11,000		421		—		11,421
Other investment securities	650		—		—		650
Total	$	1,161,098	$	14,639	$	(773)	$	1,174,964

As of December 31, 2019


(dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
U.S. Treasury securities	$	500,066	$	35	$	—	$	500,101
Obligations of the U.S. government and agencies	102,179		193		(352)		102,020
Obligations of state and political subdivisions	5,366		13		—		5,379
Mortgage-backed securities	360,977		5,182		(157)		366,002
Collateralized mortgage obligations	31,796		195		(159)		31,832
Collateralized loan obligations	—		—		—		—
Corporate bonds	—		—		—		—
Other investment securities	650		—		—		650
Total	$	1,001,034	$	5,618	$	(668)	$	1,005,984

The following tables present the aggregate amount of gross unrealized losses as of December 31, 2020 and December 31, 2019 on available for sale investment securities classified according to the amount of time those securities have been in a continuous unrealized loss position:

As of December 31, 2020


	Less than 12 Months				12 Months or Longer				Total
(dollars in thousands)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses

Obligations of the U.S. government and agencies	$	19,777	$	(219)	$	—	$	—	$	19,777	$	(219)

Mortgage-backed securities	79,990		(457)		—		—		79,990		(457)

Collateralized loan obligations	31,903		(97)		—		—		31,903		(97)


Total	$	131,670	$	(773)	$	—	$	—	$	131,670	$	(773)

As of December 31, 2019


	Less than 12 Months				12 Months or Longer				Total
(dollars in thousands)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses

Obligations of the U.S. government and agencies	$	48,497	$	(315)	$	7,966	$	(37)	$	56,463	$	(352)

Mortgage-backed securities	33,783		(119)		5,977		(38)		39,760		(157)
Collateralized mortgage obligations	6,978		(67)		10,861		(92)		17,839		(159)



Total	$	89,258	$	(501)	$	24,804	$	(167)	$	114,062	$	(668)

As of December 31, 2020, the Corporation’s available for sale investment securities consisted of 431 securities, 37 of which were in an unrealized loss position.

As of December 31, 2020, management had not made a decision to sell any of the Corporation’s available for sale investment securities in an unrealized loss position, nor did management consider it more likely than not that it would be required to sell such securities before recovery of their amortized cost basis. Management has evaluated available for sale debt securities that are in an unrealized loss position and has determined that the decline in value is unrelated to credit loss and is related to the change in market interest rates since purchase. Factors considered in this evaluation included the extent to which fair value is less than amortized cost, any explicit or implicit guarantees by the U.S. government, any changes to the rating of the security by the rating agency, and adverse conditions specifically related to the security, among other factors. As of December 31, 2020, approximately 90.8% of the Corporation’s available for sale investment securities were U.S. Treasuries or mortgage-backed securities or collateral mortgage obligations which were issued or guaranteed by U.S. government-sponsored entities and agencies. In addition, none of the available for sale debt securities held by the Corporation are past due as of December 31, 2020.

As of December 31, 2020 and December 31, 2019, there were no holdings of securities of any one issuer, other than the U.S. government and its agencies, in an amount greater than 10% of shareholders’ equity.

As of December 31, 2020 and December 31, 2019, securities having a fair value of $282.3 million and $156.4 million, respectively, were specifically pledged as collateral for public funds, trust deposits, the FRB discount window program, FHLB borrowings, collateral requirements in derivative contracts, and other purposes. Advances by the FHLB are collateralized by a blanket lien on non-pledged, mortgage-related loans and securities as part of the Corporation’s borrowing agreement with the FHLB as well as certain securities individually pledged by the Corporation.

The amortized cost and fair value of available for sale investment and mortgage-related securities available for sale as of December 31, 2020 and December 31, 2019, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities as borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.


	December 31, 2020				December 31, 2019
(dollars in thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Investment securities:
Due in one year or less	$	502,465	$	502,489	$	504,851	$	504,890
Due after one year through five years	18,679		19,167		38,710		38,623
Due after five years through ten years	77,433		77,681		53,598		53,457
Due after ten years	102,266		102,507		11,102		11,180
Subtotal	700,843		701,844		608,261		608,150
Mortgage-related securities(1)	460,255		473,120		392,773		397,834

Total	$	1,161,098	$	1,174,964	$	1,001,034	$	1,005,984

(1) Expected maturities of mortgage-related securities may differ from contractual maturities as borrowers may have the right to prepay obligations with or without prepayment penalties.

The Corporation did not have any sales of available for sale investment securities for the years ended December 31, 2020 or 2019. Proceeds from the sale of available for sale investment securities totaled and $7 thousand for the year ended December 31, 2018. Net gain on sale of available for sale investment securities totaled $7 thousand for the year ended December 31, 2018.

The amortized cost and fair value of investment securities held to maturity as of December 31, 2020 and December 31, 2019 are as follows:

As of December 31, 2020


(dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Mortgage-backed securities	$	14,759	$	451	$	(24)	$	15,186

As of December 31, 2019


(dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Mortgage-backed securities	$	12,577	$	104	$	(20)	$	12,661

The following tables present the aggregate amount of gross unrealized losses as of December 31, 2020 and December 31, 2019 on held to maturity securities classified according to the amount of time those securities have been in a continuous unrealized loss position:

As of December 31, 2020


	Less than 12 Months				12 Months or Longer				Total
(dollars in thousands)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Mortgage-backed securities	$	4,224	$	(24)	$	—	$	—	$	4,224	$	(24)

As of December 31, 2019


	Less than 12 Months				12 Months or Longer				Total
(dollars in thousands)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Mortgage-backed securities	$	3,159	$	(20)	$	—	$	—	$	3,159	$	(20)

The amortized cost and fair value of held to maturity investment securities as of December 31, 2020 and December 31, 2019, by contractual maturity, are shown below:


	December 31, 2020				December 31, 2019
(dollars in thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Mortgage-backed securities(1)	$	14,759	$	15,186	$	12,577	$	12,661

(1) Expected maturities of mortgage-related securities may differ from contractual maturities as borrowers may have the right to prepay obligations with or without prepayment penalties.

As of December 31, 2020 and December 31, 2019, the Corporation’s investment securities held in trading accounts totaled $8.6 million and $8.6 million, respectively, and primarily consist of deferred compensation trust accounts which are invested in listed mutual funds whose diversification is at the discretion of the deferred compensation plan participants and rabbi trust accounts established to fund certain unqualified pension obligations. Investment securities held in trading accounts are reported at fair value, with adjustments in fair value reported through income. Changes in the fair value of investments held in the deferred compensation trust accounts create corresponding changes in the liability to the deferred compensation plan participants.