Securities

3 Months Ended

Mar. 31, 2022

Investments, Debt and Equity Securities [Abstract]

The book values and approximate fair values of investment securities at March 31, 2022 and December 31, 2021 are summarized as follows:


($ in thousands)	March 31, 2022					December 31, 2021
	Amortized Cost		Fair Value	Unrealized		Amortized Cost		Fair Value	Unrealized
				Gains	(Losses)				Gains	(Losses)
Securities available for sale:
US Treasuries	$	149,534	149,391	—	(143)	$	—	—	—	—
Government-sponsored enterprise securities	71,953		64,168	—	(7,785)	71,951		69,179	—	(2,772)
Mortgage-backed securities	2,632,054		2,425,911	349	(206,492)	2,545,150		2,514,805	9,489	(39,834)
Corporate bonds	45,369		45,578	367	(158)	45,380		46,430	1,106	(56)
Total available for sale	$	2,898,910	2,685,048	716	(214,578)	2,662,481		2,630,414	10,595	(42,662)

Securities held to maturity:
Mortgage-backed securities	$	18,662	18,513	1	(150)	20,260		20,845	585	—
State and local governments	527,428		473,794	19	(53,653)	493,565		490,854	2,955	(5,666)
Total held to maturity	$	546,090	492,307	20	(53,803)	513,825		511,699	3,540	(5,666)

All of the Company’s mortgage-backed securities were issued by government-sponsored enterprises, except for private mortgage-backed securities with a fair value of $0.9 million and $0.9 million as of March 31, 2022 and December 31, 2021, respectively.

The following table presents information regarding securities with unrealized losses at March 31, 2022:


	Securities in an Unrealized Loss Position for Less than 12 Months			Securities in an Unrealized Loss Position for More than 12 Months		Total
($ in thousands)	Fair Value		Unrealized Losses	Fair Value	Unrealized Losses	Fair Value	Unrealized Losses
US Treasuries	$	149,391	143	—	—	149,391	143
Government-sponsored enterprise securities	19,855		2,104	44,313	5,681	64,168	7,785
Mortgage-backed securities	1,656,529		133,422	705,932	73,220	2,362,461	206,642
Corporate bonds	13,914		86	928	72	14,842	158
State and local governments	431,433		46,491	40,482	7,162	471,915	53,653
Total unrealized loss position	$	2,271,122	182,246	791,655	86,135	3,062,777	268,381

The following table presents information regarding securities with unrealized losses at December 31, 2021:


	Securities in an Unrealized Loss Position for Less than 12 Months			Securities in an Unrealized Loss Position for More than 12 Months		Total
($ in thousands)	Fair Value		Unrealized Losses	Fair Value	Unrealized Losses	Fair Value	Unrealized Losses
Government-sponsored enterprise securities	$	21,436	522	47,743	2,250	69,179	2,772
Mortgage-backed securities	1,773,022		25,977	404,484	13,857	2,177,506	39,834
Corporate bonds	999		1	945	55	1,944	56
State and local governments	228,279		3,797	34,398	1,869	262,677	5,666
Total unrealized loss position	$	2,023,736	30,297	487,570	18,031	2,511,306	48,328

As of March 31, 2022 and December 31, 2021, the Company's security portfolio held 600 securities of which 371 securities were in an unrealized loss position. In the above tables, all of the securities that were in an unrealized loss position at March 31, 2022 and December 31, 2021 are bonds that the Company has determined are in a loss position due primarily to interest rate factors and not credit quality concerns. In arriving at this conclusion, the Company reviewed third-party credit ratings and considered the severity of the impairment. The Company does not intend to sell these securities, and it is more likely than not that the Company will not be required to sell these securities before recovery of the amortized cost.

At March 31, 2022 and December 31, 2021, the Company determined that expected credit losses associated with held to maturity debt securities was insignificant.

The book values and approximate fair values of investment securities at March 31, 2022, by contractual maturity, are summarized in the table below. Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.


	Securities Available for Sale			Securities Held to Maturity
($ in thousands)	Amortized Cost		Fair Value	Amortized Cost	Fair Value
Securities
Due within one year	$	26,102	26,381	436	440
Due after one year but within five years	152,051		151,996	—	—
Due after five years but within ten years	87,703		79,832	17,141	15,988
Due after ten years	1,000		928	509,851	457,366
Mortgage-backed securities	2,632,054		2,425,911	18,662	18,513
Total securities	$	2,898,910	2,685,048	546,090	492,307

At March 31, 2022 and December 31, 2021 investment securities with carrying values of $852.8 million and $951.4 million, respectively, were pledged as collateral for public deposits.

At March 31, 2022 and December 31, 2021, there were no holdings of securities of any one issuer, other than US Government and its agencies or government sponsored enterprises, in an amount greater than 10% of shareholders equity.

Included in “Other assets” in the Consolidated Balance Sheets are investments in Federal Home Loan Bank (“FHLB”) and Federal Reserve Bank of Richmond (“FRB”) stock totaling $32.2 million and $22.3 million at March 31, 2022 and December 31, 2021, respectively. These investments do not have readily determinable fair values. The FHLB stock had a cost and fair value of $5.3 million and $4.6 million at March 31, 2022 and December 31, 2021, respectively, and serves as part of the collateral for the Company’s line of credit with the FHLB and is also a requirement for membership in the FHLB system. The FRB stock had a cost and fair value of $26.8 million and $17.8 million at March 31, 2022 and December 31, 2021, respectively, and is a requirement for FRB member bank qualification. Periodically, both the FHLB and FRB recalculate the Company’s required level of holdings, and the Company either buys more stock or redeems a portion of the stock at cost. The Company determined that neither stock was impaired at either period end.

The Company owns 12,356 Class B shares of Visa, Inc. (“Visa”) stock that were received upon Visa’s initial public offering. These shares are expected to convert into Class A Visa shares subsequent to the settlement of certain litigation against Visa, to which the Company is not a party. The Class B shares have transfer restrictions, and the conversion rate into Class A shares is periodically adjusted as Visa settles litigation. The conversion rate at March 31, 2022 was approximately 1.62, which means the Company would receive approximately 19,993 Class A shares if the stock had converted on that date. This Class B stock does not have a readily determinable fair value and is carried at zero. If a readily determinable fair value becomes available for the Class B shares, or upon the conversion to Class A shares, the Company will adjust the carrying value of the stock to its market value with a credit to earnings.