Securities

12 Months Ended

Dec. 31, 2023

Investments, Debt and Equity Securities [Abstract]

The book values and approximate fair values of investment securities at December 31, 2023 and 2022 are summarized as follows:


	2023					2022
	Amortized Cost		Fair Value	Unrealized		Amortized Cost	Fair Value	Unrealized
($ in thousands)				Gains	(Losses)			Gains	(Losses)
Securities available for sale:
US Treasury securities	$	174,785	172,570	—	(2,215)	174,420	168,758	—	(5,662)
Government-sponsored enterprise securities	71,964		60,266	—	(11,698)	71,957	57,456	—	(14,501)
Mortgage-backed securities	2,323,674		1,937,784	30	(385,920)	2,467,839	2,045,000	4	(422,843)
Corporate bonds	19,676		18,759	—	(917)	44,340	43,279	—	(1,061)
Total available for sale	$	2,590,099	2,189,379	30	(400,750)	2,758,556	2,314,493	4	(444,067)

Securities held to maturity:
Mortgage-backed securities	$	12,085	11,447	—	(638)	15,150	14,221	—	(929)
State and local governments	521,593		438,176	39	(83,456)	526,550	418,307	7	(108,250)
Total held to maturity	$	533,678	449,623	39	(84,094)	541,700	432,528	7	(109,179)

All of the Company’s mortgage-backed securities were issued by government-sponsored enterprises ("GSEs"), except for private mortgage-backed securities with a fair value of $0.7 million and $0.8 million as of December 31, 2023 and 2022, respectively.

The following table presents information regarding securities with unrealized losses at December 31, 2023:


	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 Treasury securities	$	—	—	172,570	2,215	172,570	2,215
Government-sponsored enterprise securities	—		—	60,266	11,698	60,266	11,698
Mortgage-backed securities	1,117		5	1,945,830	386,553	1,946,947	386,558
Corporate bonds	—		—	17,008	917	17,008	917
State and local governments	—		—	432,476	83,456	432,476	83,456
Total temporarily impaired securities	$	1,117	5	2,628,150	484,839	2,629,267	484,844

The following table presents information regarding securities with unrealized losses at December 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 Treasury securities	$	168,758	5,662	—	—	168,758	5,662
Government-sponsored enterprise securities	—		—	57,456	14,501	57,456	14,501
Mortgage-backed securities	221,006		18,215	1,835,958	405,557	2,056,964	423,772
Corporate bonds	40,644		947	886	114	41,530	1,061
State and local governments	48,385		8,323	368,897	99,927	417,282	108,250
Total temporarily impaired securities	$	478,793	33,147	2,263,197	520,099	2,741,990	553,246

As of December 31, 2023, the Company's securities portfolio held 657 securities of which 632 securities were in an unrealized loss position. As of December 31, 2022, the Company's securities portfolio held 666 securities of which 644 securities were in an unrealized loss position.

In the above tables, all of the securities that were in an unrealized loss position at December 31, 2023 and 2022 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 state and local government investments are comprised almost entirely of highly-rated municipal bonds issued by state and local governments throughout the nation. The Company has no significant concentrations of bond holdings from any one state or local government entity. Nearly all of the Company's mortgage-backed securities were issued by Federal Home Loan Mortgage Corporation ("FHLMC"), Federal National Mortgage Association ("FNMA"), Government National Mortgage Association ("GNMA"), or SBA, each of which is a government agency or GSE and guarantees the repayment of its securities. 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 December 31, 2023 and 2022, the Company determined that expected credit losses associated with HTM securities and AFS debt securities were insignificant.

The book values and approximate fair values of investment securities at December 31, 2023, 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
Debt securities
Due within one year	$	177,290	174,976	—	—
Due after one year but within five years	10,000		8,602	1,998	1,797
Due after five years but within ten years	78,135		67,018	129,097	110,785
Due after ten years	1,000		999	390,498	325,594
Mortgage-backed securities	2,323,674		1,937,784	12,085	11,447
Total securities	$	2,590,099	2,189,379	533,678	449,623

At December 31, 2023 and 2022, investment securities with carrying values of $971.3 million and $758.0 million, respectively, were pledged as collateral for public deposits. In addition, at December 31, 2023 and 2022, investment securities with carrying values of $679.0 million and zero, respectively, were pledged as collateral for FRB borrowings.

At December 31, 2023 and 2022, there were no holdings of securities of any one issuer, other than the US Government and its agencies or GSEs, in an amount greater than 10% of shareholders' equity.

In 2023 and 2022, there were no sales of investment securities with the exception of securities acquired from GrandSouth in 2023 which were subsequently liquidated as discussed in Note 2. There was no gain or loss associated with the sale of acquired securities. In 2021, the Company received proceeds from sales of securities of $106.5 million and recorded $1.2 million in net gains from the sales.

Included in “Other Assets” in the consolidated balance sheets are investments in FHLB and Federal Reserve stock totaling $54.5 million and $39.6 million at December 31, 2023 and 2022, respectively. These investments do not have readily determinable fair values. The FHLB stock had a cost and fair value of $21.7 million and $14.7 million at December 31, 2023 and 2022, 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 Federal Reserve stock had a cost and fair value of $32.8 million and $24.9 million at December 31, 2023 and 2022, respectively, and is a requirement for Federal Reserve member bank qualification. Periodically, both the FHLB and Federal Reserve 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 December 31, 2023 was approximately 1.59, which means the Company would receive approximately 19,615 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.