10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended June 30, 2023

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                         to ____________

Commission File Number: 0-19065

SANDY SPRING BANCORP, INC.

(Exact name of registrant as specified in its charter)

Maryland	52-1532952
(State of incorporation)	(I.R.S. Employer Identification Number)

17801 Georgia Avenue, Olney, Maryland	20832
(Address of principal executive office)	(Zip Code)

301-774-6400

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common Stock, par value $1.00 per share	SASR	The NASDAQ Stock Market, LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to filing requirements for the past 90 days.

Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☒ Accelerated filer ¨ Non-accelerated filer ¨ Smaller reporting company ☐ Emerging growth company ☐ 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)

Yes ☐ No ☒

The number of outstanding shares of common stock as of August 2, 2023

Common stock, $1.00 par value – 44,862,369 shares

SANDY SPRING BANCORP, INC.

TABLE OF CONTENTS

	Page
PART I - FINANCIAL INFORMATION
Item 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Condensed Consolidated Statements of Condition - Unaudited as of June 30, 2023 and December 31, 2022	3
Condensed Consolidated Statements of Income - Unaudited for the Three and Six Months Ended June 30, 2023 and 2022	4
Condensed Consolidated Statements of Comprehensive Income – Unaudited for the Three and Six Months Ended June 30, 2023 and 2022	5
Condensed Consolidated Statements of Changes in Stockholders’ Equity – Unaudited for the Three and Six Months Ended June 30, 2023 and 2022	6
Condensed Consolidated Statements of Cash Flows – Unaudited for the Six Months Ended June 30, 2023 and 2022	8
Notes to the Condensed Consolidated Financial Statements	9
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	36
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	67
Item 4. CONTROLS AND PROCEDURES	67
PART II - OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS	68
Item 1A. RISK FACTORS	68
Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	68
Item 3. DEFAULTS UPON SENIOR SECURITIES	68
Item 4. MINE SAFETY DISCLOSURES	68
Item 5. OTHER INFORMATION	68
Item 6. EXHIBITS	69
SIGNATURES	70

2

Part I

Item 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SANDY SPRING BANCORP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CONDITION – UNAUDITED

	June 30,		December 31,
(Dollars in thousands)	2023		2022
Assets:
Cash and due from banks	$	96,482	$	88,152
Federal funds sold	240		193
Interest-bearing deposits with banks	333,405		103,887
Cash and cash equivalents	430,127		192,232
Residential mortgage loans held for sale (at fair value)	21,476		11,706
Investments held-to-maturity, at cost (fair value of $208,662 and $220,123, respectively)	247,814		259,452
Investments available-for-sale (at fair value)	1,143,688		1,214,538
Other investments, at cost	72,052		69,218
Total loans	11,369,639		11,396,706
Less: allowance for credit losses - loans	(120,287)		(136,242)
Net loans	11,249,352		11,260,464
Premises and equipment, net	71,203		67,070
Other real estate owned	611		645
Accrued interest receivable	42,388		41,172
Goodwill	363,436		363,436
Other intangible assets, net	17,280		19,855
Other assets	335,118		333,331
Total assets	$	13,994,545	$	13,833,119
Liabilities:
Noninterest-bearing deposits	$	3,079,896	$	3,673,300
Interest-bearing deposits	7,879,026		7,280,121
Total deposits	10,958,922		10,953,421
Securities sold under retail repurchase agreements	74,510		61,967
Federal funds purchased	—		260,000
Federal Reserve Bank borrowings	300,000		—
Advances from FHLB	600,000		550,000
Subordinated debt	370,504		370,205
Total borrowings	1,345,014		1,242,172
Accrued interest payable and other liabilities	151,577		153,758
Total liabilities	12,455,513		12,349,351
Stockholders' equity:
Common stock -- par value $1.00; shares authorized 100,000,000; shares issued and outstanding
44,862,369 and 44,657,054 at June 30, 2023 and December 31, 2022, respectively	44,862		44,657
Additional paid in capital	737,740		734,273
Retained earnings	882,055		836,789
Accumulated other comprehensive loss	(125,625)		(131,951)
Total stockholders' equity	1,539,032		1,483,768
Total liabilities and stockholders' equity	$	13,994,545	$	13,833,119

The accompanying notes are an integral part of these statements

3

SANDY SPRING BANCORP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME – UNAUDITED

	Three Months Ended				Six Months Ended
	June 30,				June 30,
(Dollars in thousands, except per share data)	2023		2022		2023		2022
Interest income:
Interest and fees on loans	$	144,274	$	106,221	$	284,001	$	205,715
Interest on loans held for sale	307		145		459		343
Interest on deposits with banks	4,922		358		7,608		471
Interest and dividend income on investment securities:
Taxable	6,848		4,630		13,856		8,737
Tax-advantaged	1,795		2,554		3,565		4,678
Interest on federal funds sold	4		1		8		1
Total interest income	158,150		113,909		309,497		219,945
Interest expense:
Interest on deposits	51,325		3,795		92,113		6,088
Interest on retail repurchase agreements and federal funds purchased	4,191		201		6,295		255
Interest on advances from FHLB	8,216		17		15,423		17
Interest on subordinated debt	3,947		3,946		7,893		6,184
Total interest expense	67,679		7,959		121,724		12,544
Net interest income	90,471		105,950		187,773		207,401
Provision/ (credit) for credit losses	5,055		3,046		(16,481)		4,681
Net interest income after provision/ (credit) for credit losses	85,416		102,904		204,254		202,720
Non-interest income:
Investment securities gains	—		38		—		46
Gain on disposal of assets	—		16,699		—		16,699
Service charges on deposit accounts	2,606		2,467		4,994		4,793
Mortgage banking activities	1,817		1,483		3,062		3,781
Wealth management income	9,031		9,098		18,023		18,435
Insurance agency commissions	—		812		—		2,927
Income from bank owned life insurance	1,251		703		2,158		1,498
Bank card fees	447		1,810		865		3,478
Other income	2,024		2,135		4,025		4,183
Total non-interest income	17,176		35,245		33,127		55,840
Non-interest expense:
Salaries and employee benefits	40,931		39,550		79,857		78,923
Occupancy expense of premises	4,764		4,734		9,611		9,768
Equipment expense	3,760		3,559		7,877		7,095
Marketing	1,589		1,280		3,132		2,473
Outside data services	2,853		2,564		5,367		4,983
FDIC insurance	2,375		1,078		4,513		2,062
Amortization of intangible assets	1,269		1,466		2,575		2,974
Merger, acquisition and disposal expense	—		1,067		—		1,067
Professional fees and services	4,161		2,372		7,845		4,389
Other expenses	7,434		7,321		14,664		13,404
Total non-interest expense	69,136		64,991		135,441		127,138
Income before income tax expense	33,456		73,158		101,940		131,422
Income tax expense	8,711		18,358		25,942		32,687
Net income	$	24,745	$	54,800	$	75,998	$	98,735
Per share information:
Basic net income per common share	$	0.55	$	1.21	$	1.69	$	2.18
Diluted net income per common share	$	0.55	$	1.21	$	1.69	$	2.17
Dividends declared per share	$	0.34	$	0.34	$	0.68	$	0.68

The accompanying notes are an integral part of these statements

4

SANDY SPRING BANCORP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME – UNAUDITED

	Three Months Ended				Six Months Ended
	June 30,				June 30,
(In thousands)	2023		2022		2023		2022
Net income	$	24,745	$	54,800	$	75,998	$	98,735
Other comprehensive income/ (loss):
Investments available-for-sale:
Net change in unrealized gains/ (losses) on investments available-for-sale	(13,609)		(38,857)		7,175		(104,780)
Related income tax (expense)/ benefit	3,466		9,961		(1,828)		26,858
Net investment gains reclassified into earnings	—		(38)		—		(46)
Related income tax expense	—		10		—		12
Net effect on other comprehensive income/ (loss)	(10,143)		(28,924)		5,347		(77,956)
Investments held-to-maturity:
Net change in unrealized gains/ (losses)	458		802		863		(15,127)
Related income tax (expense)/ benefit	(117)		(205)		(220)		3,878
Net effect on other comprehensive income/ (loss)	341		597		643		(11,249)
Defined benefit pension plan:
Amortization of net loss	226		195		451		391
Related income tax benefit	(58)		(50)		(115)		(100)
Net effect on other comprehensive income/ (loss)	168		145		336		291
Total other comprehensive income/ (loss)	(9,634)		(28,182)		6,326		(88,914)
Comprehensive income	$	15,111	$	26,618	$	82,324	$	9,821

The accompanying notes are an integral part of these statements

5

SANDY SPRING BANCORP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY – UNAUDITED

(Dollars in thousands, except per share data)	Common Stock		Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Income/ (Loss)		Total Stockholders' Equity
Balances at April 1, 2023	$	44,712	$	735,509	$	872,635	$	(115,991)	$	1,536,865
Net income	—		—		24,745		—		24,745
Other comprehensive loss, net of tax	—		—		—		(9,634)		(9,634)
Total comprehensive income									15,111
Common stock dividends - $0.34 per share	—		—		(15,325)		—		(15,325)
Stock compensation expense	—		2,731		—		—		2,731
Common stock issued pursuant to:
Stock option plan - 33,391 shares	34		332		—		—		366
Employee stock purchase plan - 19,718 shares	19		414		—		—		433
Restricted stock vesting, net of tax withholding - 96,763 shares	97		(1,246)		—		—		(1,149)
Balances at June 30, 2023	$	44,862	$	737,740	$	882,055	$	(125,625)	$	1,539,032
Balances at April 1, 2022	$	45,163	$	752,671	$	760,347	$	(69,271)	$	1,488,910
Net income	—		—		54,800		—		54,800
Other comprehensive loss, net of tax	—		—		—		(28,182)		(28,182)
Total comprehensive income									26,618
Common stock dividends - $0.34 per share	—		—		(15,440)		—		(15,440)
Stock compensation expense	—		3,178		—		—		3,178
Common stock issued pursuant to:
Stock option plan - 1,464 shares	1		44		—		—		45
Employee stock purchase plan - 12,624 shares	12		482		—		—		494
Restricted stock vesting, net of tax withholding- 78,411 shares	79		(1,728)		—		—		(1,649)
Repurchase of common stock - 625,710 shares	(625)		(24,362)		—		—		(24,987)
Balances at June 30, 2022	$	44,630	$	730,285	$	799,707	$	(97,453)	$	1,477,169

The accompanying notes are an integral part of these statements

6

SANDY SPRING BANCORP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY – UNAUDITED

(Dollars in thousands, except per share data)	Common Stock		Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Income/ (Loss)		Total Stockholders' Equity
Balances at January 1, 2023	$	44,657	$	734,273	$	836,789	$	(131,951)	$	1,483,768
Net income	—		—		75,998		—		75,998
Other comprehensive loss, net of tax	—		—		—		6,326		6,326
Total comprehensive income									82,324
Common stock dividends - $0.68 per share	—		—		(30,732)		—		(30,732)
Stock compensation expense	—		3,972		—		—		3,972
Common stock issued pursuant to:
Stock option plan - 40,921 shares	41		476		—		—		517
Employee stock purchase plan - 31,539 shares	31		813		—		—		844
Restricted stock vesting, net of tax withholding - 132,855 shares	133		(1,794)		—		—		(1,661)
Balances at June 30, 2023	$	44,862	$	737,740	$	882,055	$	(125,625)	$	1,539,032
Balances at January 1, 2022	$	45,119	$	751,072	$	732,027	$	(8,539)	$	1,519,679
Net income	—		—		98,735		—		98,735
Other comprehensive loss, net of tax	—		—		—		(88,914)		(88,914)
Total comprehensive income									9,821
Common stock dividends - $0.68 per share	—		—		(31,055)		—		(31,055)
Stock compensation expense	—		4,650		—		—		4,650
Common stock issued pursuant to:
Stock option plan - 10,361 shares	10		230		—		—		240
Employee stock purchase plan - 22,205 shares	22		908		—		—		930
Restricted stock vesting, net of tax withholding - 103,911 shares	104		(2,213)		—		—		(2,109)
Repurchase of common stock - 625,710 shares	(625)		(24,362)		—		—		(24,987)
Balances at June 30, 2022	$	44,630	$	730,285	$	799,707	$	(97,453)	$	1,477,169

The accompanying notes are an integral part of these statements

7

SANDY SPRING BANCORP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS – UNAUDITED

	Six Months Ended June 30,
(Dollars in thousands)	2023		2022
Operating activities:
Net income	$	75,998	$	98,735
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	10,948		6,007
Provision/ (credit) for credit losses	(16,481)		4,681
Share based compensation expense	3,972		4,650
Gain on disposal of assets	—		(16,699)
Deferred income tax expense	7,806		972
Originations of loans held for sale	(194,320)		(200,986)
Proceeds from sales of loans held for sale	186,995		221,492
Gains on sales of loans held for sale	(2,445)		(4,707)
Losses on sale of other real estate owned	—		24
Investment securities gains	—		(46)
Tax (benefit)/ deficiency associated with share based compensation	305		(592)
Net (increase)/ decrease in accrued interest receivable	(1,216)		890
Net increase in other assets	(10,424)		(989)
Net decrease in accrued expenses and other liabilities	(6,656)		(9,425)
Other, net	(191)		(2,487)
Net cash provided by operating activities	54,291		101,520
Investing activities:
Purchases of other investments	(2,833)		(11,098)
Purchases of investments available-for-sale	—		(356,033)
Proceeds from sales of investment available-for-sale	—		1,261
Proceeds from maturities, calls and principal payments of investments available-for-sale	76,412		138,473
Proceeds from maturities, calls and principal payments of investments held-to-maturity	12,337		15,961
Net (increase)/ decrease in loans	27,075		(814,098)
Proceeds from the sales of other real estate owned	35		271
Proceeds from sale of business activity, net	—		23,936
Expenditures for premises and equipment	(7,334)		(7,612)
Net cash provided by/ (used in) investing activities	105,692		(1,008,939)
Financing activities:
Net increase in deposits	6,243		345,832
Net increase in retail repurchase agreements, federal funds purchased and Federal Reserve Bank borrowings	52,543		44,658
Proceeds from FHLB advances	2,030,000		346,625
Repayment of FHLB advances	(1,980,000)		(171,625)
Proceeds from issuance of subordinated debt	—		200,000
Proceeds from issuance of common stock	1,521		1,339
Stock tendered for payment of withholding taxes	(1,821)		(2,278)
Repurchase of common stock	—		(24,987)
Cash dividends paid	(30,574)		(30,886)
Net cash provided by financing activities	77,912		708,678
Net increase/ (decrease) in cash and cash equivalents	237,895		(198,741)
Cash and cash equivalents at beginning of period	192,232		420,020
Cash and cash equivalents at end of period	$	430,127	$	221,279
Supplemental disclosures:
Interest payments	$	120,491	$	13,859
Income tax payments, net of refunds of $0 and $966 in 2023 and 2022, respectively	22,750		25,059

The accompanying notes are an integral part of these statements

8

SANDY SPRING BANCORP, INC. AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED

NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations

Sandy Spring Bancorp, Inc. ("Bancorp" or, together with its subsidiaries, the "Company"), a Maryland corporation, is the bank holding company for Sandy Spring Bank (the “Bank”). Independent and community-oriented, the Bank offers a broad range of commercial banking, retail banking, mortgage services and trust services throughout central Maryland, Northern Virginia, and the greater Washington, D.C. market. The Bank also offers a comprehensive menu of wealth management services through its subsidiaries, West Financial Services, Inc. (“West Financial”) and SSB Wealth Management, Inc. (d/b/a Rembert Pendleton Jackson, "RPJ”).

Basis of Presentation

The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America (“GAAP”), prevailing practices within the financial services industry for interim financial information and Rule 10-01 of Regulation S-X. Accordingly, the interim financial statements do not include all of the information and notes required for complete financial statements. The following summary of significant accounting policies of the Company is presented to assist the reader in understanding the financial and other data presented in this report. Operating results for the six months ended June 30, 2023 are not necessarily indicative of the results that may be expected for any future periods or for the year ending December 31, 2023. In the opinion of management, all adjustments necessary for a fair presentation of the results of the interim periods have been included. The Company has evaluated subsequent events through the date of the issuance of its financial statements.

These statements should be read in conjunction with the financial statements and accompanying notes included in the Company’s 2022 Annual Report on Form 10-K as filed with the Securities and Exchange Commission (“SEC”) on February 21, 2023. There have been no significant changes to any of the Company’s accounting policies as disclosed in the 2022 Annual Report on Form 10-K.

Principles of Consolidation

The unaudited Condensed Consolidated Financial Statements include the accounts of the Company and its wholly-owned subsidiary, Sandy Spring Bank, and its subsidiaries. Consolidation has resulted in the elimination of all intercompany accounts and transactions.

Use of Estimates

The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements, in addition to affecting the reported amounts of revenues earned and expenses incurred during the reporting period. Actual results could differ from those estimates. Estimates that could change significantly relate to the provision for credit losses and the related allowance, potential impairment of goodwill or other intangible assets, valuation of investment securities and the determination of whether available-for-sale debt securities with fair values less than amortized costs are impaired and require an allowance for credit losses, valuation of other real estate owned, valuation of share based compensation, the assessment that a liability should be recognized with respect to any matters under litigation, the calculation of current and deferred income taxes, and the actuarial projections related to pension expense and the related liability.

Cash Flows

For purposes of reporting cash flows, cash and cash equivalents include cash and due from banks, federal funds sold and interest-bearing deposits with banks (items with stated original maturity of three months or less).

Revenue from Contracts with Customers

The Company’s revenue includes net interest income on financial instruments and non-interest income. Specific categories of revenue are presented in the Condensed Consolidated Statements of Income. Most of the Company’s revenue is not within the scope of Accounting Standard Codification (“ASC”) 606 – Revenue from Contracts with Customers. For revenue within the scope of ASC 606, the Company provides services to customers and has related performance obligations. The revenue from such services is recognized upon satisfaction of all contractual performance obligations. The following discusses key revenue streams within the scope of this revenue recognition guidance.

West Financial and RPJ provide comprehensive investment management and financial planning services. Wealth management income is comprised of income for providing trust, estate and investment management services. Trust services include acting as

9

a trustee for corporate or personal trusts. Investment management services include investment management, record-keeping and reporting of security portfolios. Fees for these services are recognized based on a contractually-agreed fixed percentage applied to net assets under management at the end of each reporting period. The Company does not charge/recognize any performance-based fees.

Prior to the sale of its assets in June 2022, Sandy Spring Insurance Corporation performed the function of an insurance intermediary by introducing the policyholder and insurer and was compensated by a commission fee for placement of an insurance policy. Sandy Spring Insurance did not provide any captive management services or any claim handling services. Commission fees were set as a percentage of the premium for the insurance policy for which Sandy Spring Insurance was a producer. Sandy Spring Insurance recognized revenue when the insurance policy was contractually agreed to by the insurer and policyholder (at transaction date).

Service charges on deposit accounts are earned on depository accounts for consumer and commercial account holders and include fees for account and overdraft services. Account services include fees for event-driven services and periodic account maintenance activities. An obligation for event-driven services is satisfied at the time of the event when service is delivered and revenue recognized as earned. Obligation for maintenance activities is satisfied over the course of each month and revenue is recognized at month end. The overdraft services obligation is satisfied at the time of the overdraft and revenue is recognized as earned.

Loan Financing Receivables

The Company’s financing receivables consist primarily of loans that are stated at their principal balance outstanding, net of any unearned income, acquisition fair value marks and deferred loan origination fees and costs. Interest income on loans is accrued at the contractual rate based on the principal balance outstanding. Loan origination fees, net of certain direct origination costs, are deferred and recognized as an adjustment of the related loan yield using the interest method.

Loans are considered past due or delinquent when the principal or interest due in accordance with the contractual terms of the loan agreement or any portion thereof remains unpaid after the due date of the scheduled payment. Immaterial shortfalls in payment amounts do not necessarily result in a loan being considered delinquent or past due. If any payments are past due and subsequent payments are resumed without payment of the delinquent amount, the loan shall continue to be considered past due. Whenever any loan is reported delinquent on a principal or interest payment or portion thereof, the amount reported as delinquent is the outstanding principal balance of the loan.

Loans, except for consumer installment loans, are placed into non-accrual status when any portion of the loan principal or interest becomes 90 days past due. Management may determine that certain circumstances warrant earlier discontinuance of interest accruals on specific loans if an evaluation of other relevant factors (such as bankruptcy, interruption of cash flows, etc.) indicates collection of amounts contractually due is unlikely. These loans are considered, collectively, to be non-performing loans. Consumer installment loans that are not secured by real estate are not placed on non-accrual, but are charged down to their net realizable value when they are four months past due. Loans designated as non-accrual have all previously accrued but unpaid interest reversed. Interest income is not recognized on non-accrual loans. All payments received on non-accrual loans are applied using a cost-recovery method to reduce the outstanding principal balance until the loan returns to accrual status. Loans may be returned to accrual status when all principal and interest amounts contractually due are brought current and future payments are reasonably assured.

On January 1, 2023, the Company adopted provisions of ASU 2022-02, "Financial Instruments - Credit Losses (Topic 326)", which eliminated accounting guidance for TDRs by creditors. Prior to the effective adoption date, the Company considered loans to be TDRs if their terms were restructured (e.g., interest rates, loan maturity date, payment and amortization period, etc.) in circumstances that provided a payment concession to a borrower experiencing financial difficulty. Loans could be removed from a TDR category if the borrower no longer experienced financial difficulty, a re-underwriting event took place, and the revised loan terms of the subsequent restructuring agreement were considered to be consistent with terms that could be obtained in the market for loans with comparable credit risk. Subsequent to the effective adoption date, the Company continues to offer modifications to certain borrowers experiencing financial difficulty, mainly in the form of interest rate concessions or term extensions, without classifying and accounting for them as TDRs.

Allowance for Credit Losses

The allowance for credit losses (“allowance” or “ACL”) represents an amount which, in management's judgment, reflects the lifetime expected losses that may be sustained on outstanding loans at the balance sheet date based on the evaluation of the size and current risk characteristics of the loan portfolio, past events, current conditions, reasonable and supportable forecasts of future economic conditions and prepayment experience. The allowance is measured and recorded upon the initial recognition of

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a financial asset. The allowance is reduced by charge-offs, net of recoveries of previous losses, and is increased or decreased by a provision or credit for credit losses, which is recorded as a current period expense.

Determination of the appropriateness of the allowance is inherently complex and requires the use of significant and highly subjective estimates. The reasonableness of the allowance is reviewed periodically by the Risk Committee of the Board of Directors and formally approved quarterly by that same committee of the Board.

The Company’s methodology for estimating the allowance includes: (1) a collective quantified reserve that reflects the Company’s historical default and loss experience adjusted for expected economic conditions throughout a reasonable and supportable period and the Company’s prepayment and curtailment rates; (2) collective qualitative factors that consider the expected impact of certain factors not fully captured in the collective quantified reserve, including concentrations of the loan portfolio, expected changes to the economic forecasts, large relationships, early delinquencies, and factors related to credit administration, including, among others, loan-to-value ratios, borrowers’ risk rating and credit score migrations; and (3) individual allowances on collateral-dependent loans where borrowers are experiencing financial difficulty or when the Company determines that the foreclosure is probable. The Company excludes accrued interest from the measurement of the allowance as the Company has a non-accrual policy to reverse any accrued, uncollected interest income as loans are moved to non-accrual status.

Loans are pooled into segments based on the similar risk characteristics of the underlying borrowers, in addition to consideration of collateral type, industry and business purpose of the loans. Portfolio segments used to estimate the allowance are the same as portfolio segments used for general credit risk management purposes. Refer to Note 4 for more details on the Company’s portfolio segments.

The Company applies two calculation methodologies to estimate the collective quantified component of the allowance: discounted cash flows method and weighted average remaining life method. Allowance estimates on commercial acquisition, development and construction (“AD&C”) and residential construction segments are based on the weighted average remaining life method. Allowance estimates on all other portfolio segments are based on the discounted cash flows method. Segments utilizing the discounted cash flows method are further sub-segmented into risk level pools, determined either by risk rating for commercial loans or Beacon Scores ranges for residential and consumer loans. To better manage risk and reasonably determine the sufficiency of reserves, this segregation allows the Company to monitor the allowance component applicable to higher risk loans separate from the remainder of the portfolio. Collective calculation methodologies utilize the Company’s historical default and loss experience adjusted for future economic forecasts. The reasonable and supportable forecast period represents a two-year economic outlook for the applicable economic variables. Following the end of the reasonable and supportable forecast period expected losses revert back to the historical mean over the next two years on a straight-line basis. Economic variables that have the most significant impact on the allowance include: unemployment rate, house price index and business bankruptcies. Contractual loan level cash flows within the discounted cash flows methodology are adjusted for the Company’s historical prepayment and curtailment rate experience.

The individual reserve assessment is applied to collateral dependent loans where borrowers are experiencing financial difficulty or when the Company determines that a foreclosure is probable. The determination of the fair value of the collateral depends on whether a repayment of the loan is expected to be from the sale or the operation of the collateral. When a repayment is expected from the operation of the collateral, the Company uses the present value of expected cash flows from the operation of the collateral as the fair value. When the repayment of the loan is expected from the sale of the collateral the fair value of the collateral is based on an observable market price or the collateral’s appraised value, less estimated costs to sell. Third-party appraisals used in the individual reserve assessment are conducted at least annually with underlying assumptions that are reviewed by management. Third-party appraisals may be obtained on a more frequent basis if deemed necessary. Internal evaluations of collateral value are conducted quarterly to ensure any further deterioration of the collateral value is recognized on a timely basis. During the individual reserve assessment, management also considers the potential future changes in the value of the collateral over the remainder of the loan’s remaining life. The Company may receive updated appraisals which contradict the preliminary determination of fair value used to establish an individual allowance on a loan. In these instances the individual allowance is adjusted to reflect the Company’s evaluation of the updated appraised fair value. In the event a loss was previously confirmed and the loan was charged down to the estimated fair value based on a previous appraisal, the balance of partially charged-off loans are not subsequently increased, but could be further decreased depending on the direction of the change in fair value. Payments on fully or partially charged-off loans are accounted for under the cost-recovery method. Under this method, all payments received are applied on a cash basis to reduce the entire outstanding principal balance, then to recognize a recovery of all previously charged-off amounts before any interest income may be recognized. Based on the individual reserve assessment, if the Company determines that the fair value of the collateral is less than the amortized cost basis of the loan, an individual allowance will be established measured as the difference between the fair value of the collateral

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(less costs to sell) and the amortized cost basis of the loan. Once a loss has been confirmed, the loan is charged-down to its estimated fair value.

Large groups of smaller non-accrual homogeneous loans are not individually evaluated for allowance and include residential permanent and construction mortgages and consumer installment loans. These portfolios are reserved for on a collective basis using historical loss rates of similar loans over the weighted average life of each pool.

Unfunded lending commitments are reviewed to determine if they are considered unconditionally cancellable. The Company establishes reserves for unfunded commitments that do not meet that criteria as a liability in the Condensed Consolidated Statements of Condition. Changes to the liability are recorded through the provision for credit losses in the Condensed Consolidated Statements of Income. The establishment of the reserves for unfunded commitments considers both the likelihood that the funding will occur and an estimate of the expected credit losses over the life of the respective commitments.

Management believes it uses relevant information available to make determinations about the allowance and reserve for unfunded commitments and that it has established the existing reserves in accordance with GAAP. However, the determination of the allowance requires significant judgment, and estimates of expected lifetime losses in the loan portfolio can vary significantly from the amounts actually observed. While management uses available information to recognize expected losses, future additions to the allowance may be necessary based on changes in the loans comprising the portfolio, changes in the current and forecasted economic conditions, changes to the interest rate environment which may directly impact prepayment and curtailment rate assumptions, and changes in the financial condition of borrowers.

Held-to-maturity debt securities

Debt securities that are purchased with the positive intent and ability to be held until their maturity are classified as held-to-maturity (“HTM”). HTM debt securities are recorded at cost adjusted for amortization of premiums and accretion of discounts. Transfers of debt securities from available-for-sale ("AFS") category to HTM category are made at fair value as of the transfer date. The unrealized gain or loss at the date of transfer continues to be reported in accumulated other comprehensive income and in the carrying amount of the HTM securities. Both amounts are amortized over the remaining life of the security as a yield adjustment in interest income and effectively offset each other.

Leases

The Company determines if an arrangement is a lease at inception. All of the Company’s leases are currently classified as operating leases and are included in other assets and other liabilities on the Company’s Condensed Consolidated Statements of Condition. Periodic operating lease costs are recorded in occupancy expenses of premises on the Company's Condensed Consolidated Statements of Income.

Right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease arrangements. Operating lease ROU assets and liabilities are recognized at the lease commencement date based on the present value of the expected future lease payments over the remaining lease term. In determining the present value of future lease payments, the Company uses its incremental borrowing rate based on the information available at the lease commencement date. The operating ROU assets are adjusted for any lease payments made at or before the lease commencement date, initial direct costs, any lease incentives received and, for acquired leases, any favorable or unfavorable fair value adjustments. The present value of the lease liability may include the impact of options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options provided in the lease terms. Lease expense is recognized on a straight-line basis over the expected lease term. Lease agreements that include lease and non-lease components, such as common area maintenance charges, are accounted for separately.

Adopted Accounting Pronouncements

In March 2022, the FASB issued ASU 2022-02, "Financial Instruments - Credit Losses (Topic 326)", which eliminated the accounting guidance on troubled debt restructurings (“TDR”) and amended the guidance on “vintage disclosures” to require disclosure of current period gross charge-offs by year of origination. The ASU also added enhanced disclosures for creditors with respect to loan refinancing and restructurings for borrowers experiencing financial difficulty. The objective of the disclosures was to provide information about the type and magnitude of modifications and the degree of their success in mitigating potential credit losses. The Company fully adopted this update effective January 1, 2023 on a prospective basis. The adoption of this pronouncement did not have a material impact on the Consolidated Financial Statements.

Pending Accounting Pronouncements

In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848)”. This ASU provided temporary, optional

guidance to ease the potential burden in accounting for, or recognizing the effects of, the transition away from the London Interbank Offered Rate ("LIBOR") or other reference rate expected to be discontinued on financial reporting. The standard was

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elective and provided optional expedients and exceptions for applying GAAP to contracts, hedging relationships, or other transactions that reference LIBOR, or another reference rate expected to be discontinued. The amendments in the update were effective for all entities between March 12, 2020 and December 31, 2022. In January 2021, the FASB issued ASU 2021-01, “Reference Rate Reform (Topic 848): Scope”. This ASU refines the scope of Topic 848 and addresses questions about whether Topic 848 can be applied to derivative instruments that do not reference a rate that is expected to be discontinued, but that use an interest rate for margining, discounting or contract price alignment that is expected to be modified as a result of reference rate reform. ASU 2021-01 is effective upon issuance through December 31, 2024, and can be adopted at any time during this period. The Company has not offered LIBOR for any new contracts since 2021. The Company has identified all known LIBOR exposures, created a plan to address the exposures, and continues to communicate with all stakeholders in order to facilitate the transition to an alternative reference rate. The Company adopted ASU 2020-04 on January 1, 2022. The adoption did not have a material impact on the Company’s Consolidated Financial Statements. The Company continues to evaluate the adoption of ASU 2021-01 and does not expect it to have a material impact on the Company's Consolidated Financial Statements.

NOTE 2 – INVESTMENTS

Investments available-for-sale and held-to-maturity

The amortized cost and estimated fair values of investments available-for-sale and held-to-maturity at the dates indicated are presented in the following table:

	June 30, 2023								December 31, 2022
(In thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Available-for-sale debt securities:
U.S. treasuries and government agencies	$	101,299	$	—	$	(6,954)	$	94,345	$	100,926	$	—	$	(7,304)	$	93,622
State and municipal	318,815		1		(50,565)		268,251		322,519		4		(56,526)		265,997
Mortgage-backed and asset-backed	868,704		40		(87,652)		781,092		943,398		73		(88,552)		854,919
Total available-for-sale debt securities	$	1,288,818	$	41	$	(145,171)	$	1,143,688	$	1,366,843	$	77	$	(152,382)	$	1,214,538
Held-to-maturity debt securities:
Mortgage-backed and asset-backed	247,814		—		(39,152)		208,662		259,452		—		(39,329)		220,123
Total held-to-maturity debt securities	$	247,814	$	—	$	(39,152)	$	208,662	$	259,452	$	—	$	(39,329)	$	220,123
Total debt securities	$	1,536,632	$	41	$	(184,323)	$	1,352,350	$	1,626,295	$	77	$	(191,711)	$	1,434,661

Any unrealized losses in the U.S. treasuries and government agencies, state and municipal, mortgage-backed and asset-backed available-for-sale debt securities at June 30, 2023 are due to changes in interest rates and not credit-related events. As such, no allowance for credit losses is required at June 30, 2023. Unrealized losses on available-for-sale debt securities are expected to recover over time as these securities approach maturity. The Company does not intend to sell, nor is it more likely than not it will be required to sell, these securities and has sufficient liquidity to hold these securities for an adequate period of time, which may be maturity, to allow for any anticipated recovery in fair value.

All held-to-maturity investments are either issued by a direct governmental entity or a government-sponsored entity and have no historical evidence supporting expected credit losses. Therefore, the Company has estimated these losses at zero and will monitor this assumption in the future for any economic or governmental policies that could affect this assumption.

The available-for-sale and held-to-maturity mortgage-backed securities portfolio at June 30, 2023 is composed entirely of either the most senior tranches of GNMA, FNMA or FHLMC collateralized mortgage obligations ($466.7 million), GNMA, FNMA or FHLMC mortgage-backed securities ($611.3 million) or SBA asset-backed securities ($38.5 million).

Gross unrealized losses and fair value by length of time that the individual available-for-sale debt securities have been in an unrealized loss position at the dates indicated are presented in the following tables:

	June 30, 2023
	Number of Securities	Less Than 12 Months				12 Months or More				Total
(Dollars in thousands)		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
U.S. treasuries and government agencies	10	$	—	$	—	$	94,345	$	6,954	$	94,345	$	6,954
State and municipal	127	17,222		488		249,495		50,077		266,717		50,565
Mortgage-backed and asset-backed	327	158,418		6,042		613,216		81,610		771,634		87,652
Total	464	$	175,640	$	6,530	$	957,056	$	138,641	$	1,132,696	$	145,171

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	December 31, 2022
	Number of Securities	Less Than 12 Months				12 Months or More				Total
(Dollars in thousands)		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
U.S. treasuries and government agencies	10	$	53,139	$	3,653	$	40,483	$	3,651	$	93,622	$	7,304
State and municipal	130	200,439		30,803		62,482		25,723		262,921		56,526
Mortgage-backed and asset-backed	324	526,387		44,952		297,216		43,600		823,603		88,552
Total	464	$	779,965	$	79,408	$	400,181	$	72,974	$	1,180,146	$	152,382

The Company has allocated mortgage-backed securities into the four maturity groupings reflected in the following tables using the expected average life of the individual securities based on statistics provided by independent third-party industry sources. Expected maturities will differ from contractual maturities as borrowers may have the right to prepay obligations with or without prepayment penalties.

The estimated fair values and amortized costs of available-for-sale and held-to-maturity debt securities by contractual maturity are provided in the following tables.

	June 30, 2023				December 31, 2022
(In thousands)	Fair Value		Amortized Cost		Fair Value		Amortized Cost
Available-for-sale debt securities
U.S. treasuries and government agencies:
One year or less	$	14,580	$	14,984	$	—	$	—
One to five years	79,765		86,315		93,622		100,926
Five to ten years	—		—		—		—
After ten years	—		—		—		—
State and municipal:
One year or less	6,799		6,842		8,694		8,783
One to five years	53,557		55,926		51,576		53,948
Five to ten years	36,343		43,156		28,806		34,042
After ten years	171,552		212,891		176,921		225,746
Mortgage-backed and asset-backed:
One year or less	4,692		4,744		7,622		7,704
One to five years	47,004		48,742		45,366		46,802
Five to ten years	274,805		305,295		303,697		335,285
After ten years	454,591		509,923		498,234		553,607
Total available-for-sale debt securities	$	1,143,688	$	1,288,818	$	1,214,538	$	1,366,843

	June 30, 2023				December 31, 2022
(In thousands)	Fair Value		Amortized Cost		Fair Value		Amortized Cost
Held-to-maturity debt securities
Mortgage-backed and asset-backed:
One year or less	$	—	$	—	$	—	$	—
One to five years	—		—		—		—
Five to ten years	32,997		36,828		35,304		39,213
After ten years	175,665		210,986		184,819		220,239
Total held-to-maturity debt securities	$	208,662	$	247,814	$	220,123	$	259,452

At June 30, 2023 and December 31, 2022, available-for-sale and held-to-maturity debt securities with a book value of $776.8 million and $533.9 million, respectively, were pledged and designated as collateral for certain government deposits, public and trust funds, securities sold under repurchase agreements and other purposes as required or permitted by law. The outstanding balance of no single issuer, except for U.S. Agencies securities, exceeded ten percent of stockholders' equity at June 30, 2023 and December 31, 2022.

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Other investments

Other investments are presented in the following table:

(In thousands)	June 30, 2023		December 31, 2022
Federal Reserve Bank stock, at cost	$	38,961	$	38,873
Federal Home Loan Bank of Atlanta stock, at cost	32,414		29,668
Other	677		677
Total other investments, at cost	$	72,052	$	69,218

NOTE 3 – LOANS

Outstanding loan balances at June 30, 2023 and December 31, 2022 are net of unearned income, including net deferred loan fees of $9.3 million and $10.5 million, respectively, at the end of each period.

The loan portfolio segment balances at the dates indicated are presented in the following table:

(In thousands)	June 30, 2023		December 31, 2022
Commercial real estate:
Commercial investor real estate	$	5,131,210	$	5,130,094
Commercial owner-occupied real estate	1,770,135		1,775,037
Commercial AD&C	1,045,742		1,090,028
Commercial business	1,423,614		1,455,885
Total commercial loans	9,370,701		9,451,044
Residential real estate:
Residential mortgage	1,385,743		1,287,933
Residential construction	190,690		224,772
Consumer	422,505		432,957
Total residential and consumer loans	1,998,938		1,945,662
Total loans	$	11,369,639	$	11,396,706

Portfolio Segments

The Company currently manages its credit products and the respective exposure to credit losses (credit risk) by the following specific portfolio segments (classes) which are levels at which the Company develops and documents its systematic methodology to determine the allowance for credit losses attributable to each respective portfolio segment. These segments are:

•Commercial investor real estate loans - Commercial investor real estate loans consist of loans secured by nonowner-occupied properties where an established banking relationship exists and involves investment properties for warehouse, retail, and office space with a history of occupancy and cash flow. This commercial investor real estate category contains mortgage loans to the developers and owners of commercial real estate where the borrower intends to operate or sell the property at a profit and use the income stream or proceeds from the sale(s) to repay the loan.

•Commercial owner-occupied real estate loans - Commercial owner-occupied real estate loans consist of commercial mortgage loans secured by owner occupied properties where an established banking relationship exists and involves a variety of property types to conduct the borrower’s operations. The decision to extend a loan is based upon the borrower’s financial health and the ability of the borrower and the business to repay. The primary source of repayment for this type of loan is the cash flow from the operations of the business.

•Commercial acquisition, development and construction loans - Commercial acquisition, development and construction loans are intended to finance the construction of commercial properties and include loans for the acquisition and development of land. Construction loans represent a higher degree of risk than permanent real estate loans and may be affected by a variety of additional factors such as the borrower’s ability to control costs and adhere to time schedules and the risk that constructed units may not be absorbed by the market within the anticipated time frame or at the anticipated price. The loan commitment on these loans often includes an interest reserve that allows the lender to periodically advance loan funds to pay interest charges on the outstanding balance of the loan.

•Commercial business loans - Commercial loans are made to provide funds for equipment and general corporate needs. Repayment of a loan primarily comes from the funds obtained from the operation of the borrower’s business.

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Commercial loans also include lines of credit that are utilized to finance a borrower’s short-term credit needs and/or to finance a percentage of eligible receivables and inventory. Loans issued under the PPP are also included in this category, a substantial portion of which are expected to be forgiven by the Small Business Administration pursuant to the CARES Act.

•Residential mortgage loans - The residential mortgage loans category contains permanent mortgage loans principally to consumers secured by residential real estate. Residential real estate loans are evaluated for the adequacy of repayment sources at the time of approval, based upon measures including credit scores, debt-to-income ratios, and collateral values. Loans may be either conforming or non-conforming.

•Residential construction loans - The Company makes residential construction loans generally to provide interim financing on residential property during the construction period. Borrowers are typically individuals who will ultimately occupy the single-family dwelling. Loan funds are disbursed periodically as pre-specified stages of completion are attained based upon site inspections.

•Consumer loans - This category of loans includes primarily home equity loans and lines, installment loans, personal lines of credit, and other loans. The home equity category consists mainly of revolving lines of credit to consumers which are secured by residential real estate. These loans are typically secured with second mortgages on the homes. Other consumer loans include installment loans used by customers to purchase automobiles, boats and recreational vehicles.

NOTE 4 – CREDIT QUALITY ASSESSMENT

Allowance for Credit Losses

Summary information on the allowance for credit losses on loans for the period indicated is provided in the following table:

	Six Months Ended June 30,
(In thousands)	2023		2022
Balance at beginning of period	$	136,242	$	109,145
Provision/ (credit) for credit losses - loans (1)	(14,491)		4,681
Loan charge-offs	(2,265)		(762)
Loan recoveries	801		606
Net charge-offs	(1,464)		(156)
Balance at period end	$	120,287	$	113,670

 (1) Excludes the total credit to the provision on unfunded loan commitments for six months ended June 30, 2023 of $2.0 million.

The following table provides summary information regarding collateral dependent loans individually evaluated for credit loss at the dates indicated:

(In thousands)	June 30, 2023		December 31, 2022
Collateral dependent loans individually evaluated for credit loss with an allowance	$	48,878	$	9,743
Collateral dependent loans individually evaluated for credit loss without an allowance	14,652		16,454
Total individually evaluated collateral dependent loans	$	63,530	$	26,197
Allowance for credit losses related to loans evaluated individually	$	16,224	$	6,902
Allowance for credit losses related to loans evaluated collectively	104,063		129,340
Total allowance for credit losses - loans	$	120,287	$	136,242

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The following tables provide information on the activity in the allowance for credit losses by the respective loan portfolio segment for the period indicated:

	For the Six Months Ended June 30, 2023
	Commercial Real Estate												Residential Real Estate
(Dollars in thousands)	Commercial Investor R/E			Commercial Owner- Occupied R/E			Commercial AD&C			Commercial Business			Residential Mortgage			Residential Construction			Consumer			Total
Balance at beginning of period	$	64,737		$	11,646		$	18,646		$	28,027		$	9,424		$	1,337		$	2,425		$	136,242
Provision/ (credit) for credit losses - loans	(3,669)			(2,469)			(8,446)			123			(207)			(487)			664			(14,491)
Charge-offs	—			—			—			(423)			(160)			—			(1,682)			(2,265)
Recoveries	19			53			—			187			104			—			438			801
Net (charge-offs)/ recoveries	19			53			—			(236)			(56)			—			(1,244)			(1,464)
Balance at end of period	$	61,087		$	9,230		$	10,200		$	27,914		$	9,161		$	850		$	1,845		$	120,287
Total loans	$	5,131,210		$	1,770,135		$	1,045,742		$	1,423,614		$	1,385,743		$	190,690		$	422,505		$	11,369,639
Allowance for credit losses on loans to total loans ratio	1.19		%	0.52		%	0.98		%	1.96		%	0.66		%	0.45		%	0.44		%	1.06		%
Average loans	$	5,141,447		$	1,771,369		$	1,069,927		$	1,443,030		$	1,330,912		$	217,419		$	423,711		$	11,397,815
Annualized net charge-offs/ (recoveries) to average loans	—		%	(0.01)		%	—		%	0.03		%	0.01		%	—		%	0.59		%	0.03		%
Balance of loans individually evaluated for credit loss	$	48,721		$	4,846		$	570		$	9,393		$	—		$	—		$	—		$	63,530
Allowance related to loans evaluated individually	$	7,908		$	1,226		$	102		$	6,988		$	—		$	—		$	—		$	16,224
Individual allowance to loans evaluated individually ratio	16.23		%	25.30		%	17.89		%	74.40		%	—		%	—		%	—		%	25.54		%
Contractual balance of individually evaluated loans	$	48,886		$	5,675		$	581		$	10,545		$	—		$	—		$	—		$	65,687
Balance of loans collectively evaluated for credit loss	$	5,082,489		$	1,765,289		$	1,045,172		$	1,414,221		$	1,385,743		$	190,690		$	422,505		$	11,306,109
Allowance related to loans evaluated collectively	$	53,179		$	8,004		$	10,098		$	20,926		$	9,161		$	850		$	1,845		$	104,063
Collective allowance to loans evaluated collectively ratio	1.05		%	0.45		%	0.97		%	1.48		%	0.66		%	0.45		%	0.44		%	0.92		%

	For the Year Ended December 31, 2022
	Commercial Real Estate												Residential Real Estate
(Dollars in thousands)	Commercial Investor R/E			Commercial Owner- Occupied R/E			Commercial AD&C			Commercial Business			Residential Mortgage			Residential Construction			Consumer			Total
Balance at beginning of period	$	45,289		$	11,687		$	20,322		$	23,170		$	5,384		$	1,048		$	2,245		$	109,145
Provision for credit losses - loans	19,128			(90)			(1,676)			4,774			4,093			281			170			26,680
Charge-offs	—			—			—			(716)			(155)			—			(234)			(1,105)
Recoveries	320			49			—			799			102			8			244			1,522
Net (charge-offs)/ recoveries	320			49			—			83			(53)			8			10			417
Balance at end of period	$	64,737		$	11,646		$	18,646		$	28,027		$	9,424		$	1,337		$	2,425		$	136,242
Total loans	$	5,130,094		$	1,775,037		$	1,090,028		$	1,455,885		$	1,287,933		$	224,772		$	432,957		$	11,396,706
Allowance for credit losses on loans to total loans ratio	1.26		%	0.66		%	1.71		%	1.93		%	0.73		%	0.59		%	0.56		%	1.20		%
Average loans	$	4,681,607		$	1,730,293		$	1,112,936		$	1,351,906		$	1,117,053		$	221,341		$	423,746		$	10,638,882
Net charge-offs/ (recoveries) to average loans	(0.01)		%	—		%	—		%	(0.01)		%	—		%	—		%	—		%	—		%
Balance of loans individually evaluated for credit loss	$	9,943		$	6,155		$	—		$	8,274		$	1,487		$	—		$	338		$	26,197
Allowance related to loans evaluated individually	$	134		$	1,261		$	—		$	5,507		$	—		$	—		$	—		$	6,902
Individual allowance to loans evaluated individually ratio	1.35		%	20.49		%	—		%	66.56		%	—		%	—		%	—		%	26.35		%
Contractual balance of individually evaluated loans	$	10,882		$	6,849		$	—		$	9,893		$	1,487		$	—		$	364		$	29,475
Balance of loans collectively evaluated for credit loss	$	5,120,151		$	1,768,882		$	1,090,028		$	1,447,611		$	1,286,446		$	224,772		$	432,619		$	11,370,509
Allowance related to loans evaluated collectively	$	64,603		$	10,385		$	18,646		$	22,520		$	9,424		$	1,337		$	2,425		$	129,340
Collective allowance to loans evaluated collectively ratio	1.26		%	0.59		%	1.71		%	1.56		%	0.73		%	0.59		%	0.56		%	1.14		%

17

Credit Quality

The following section provides information on the credit quality of the loan portfolio for the periods indicated below:

	For the Six Months Ended June 30, 2023
	Commercial Real Estate								Residential Real Estate
(In thousands)	Commercial Investor R/E		Commercial Owner- Occupied R/E		Commercial AD&C		Commercial Business		Residential Mortgage		Residential Construction		Consumer		Total
Analysis of non-accrual loan activity:
Balance at beginning of period	$	9,943	$	5,019	$	—	$	7,322	$	7,439	$	—	$	5,059	$	34,782
Loans placed on non-accrual	19,622		—		569		4,362		3,540		—		897		28,990
Non-accrual balances transferred to OREO	—		—		—		—		—		—		—		—
Non-accrual balances charged-off	—		—		—		(424)		(160)		—		(1,591)		(2,175)
Net payments or draws	(9,184)		(173)		—		(1,354)		(309)		—		(846)		(11,866)
Non-accrual loans brought current	—		—		—		(513)		(357)		—		(123)		(993)
Balance at end of period	$	20,381	$	4,846	$	569	$	9,393	$	10,153	$	—	$	3,396	$	48,738

	For the Year Ended December 31, 2022
	Commercial Real Estate								Residential Real Estate
(In thousands)	Commercial Investor R/E		Commercial Owner- Occupied R/E		Commercial AD&C		Commercial Business		Residential Mortgage		Residential Construction		Consumer		Total
Analysis of non-accrual loan activity:
Balance at beginning of period	$	12,489	$	9,306	$	650	$	8,420	$	8,441	$	55	$	6,725	$	46,086
Loans placed on non-accrual	4,761		2,370		—		1,591		2,593		—		815		12,130
Non-accrual balances transferred to OREO	—		—		—		—		—		—		—		—
Non-accrual balances charged-off	—		—		—		(677)		(151)		—		(32)		(860)
Net payments or draws	(7,307)		(4,366)		(650)		(2,012)		(2,615)		(55)		(2,060)		(19,065)
Non-accrual loans brought current	—		(2,291)		—		—		(829)		—		(389)		(3,509)
Balance at end of period	$	9,943	$	5,019	$	—	$	7,322	$	7,439	$	—	$	5,059	$	34,782

	June 30, 2023
	Commercial Real Estate								Residential Real Estate
(In thousands)	Commercial Investor R/E		Commercial Owner- Occupied R/E		Commercial AD&C		Commercial Business		Residential Mortgage		Residential Construction		Consumer		Total
Performing loans:
Current	$	5,108,614	$	1,763,223	$	1,044,320	$	1,413,058	$	1,366,644	$	190,690	$	416,799	$	11,303,348
30-59 days	2,215		2,066		—		747		5,464		—		1,849		12,341
60-89 days	—		—		853		387		2,790		—		461		4,491
Total performing loans	5,110,829		1,765,289		1,045,173		1,414,192		1,374,898		190,690		419,109		11,320,180
Non-performing loans:
Non-accrual loans	20,381		4,846		569		9,393		10,153		—		3,396		48,738
Loans greater than 90 days past due	—		—		—		29		692		—		—		721
Restructured loans (1)	—		—		—		—		—		—		—		—
Total non-performing loans	20,381		4,846		569		9,422		10,845		—		3,396		49,459
Total loans	$	5,131,210	$	1,770,135	$	1,045,742	$	1,423,614	$	1,385,743	$	190,690	$	422,505	$	11,369,639

(1) Effective January 1, 2023, the Company adopted ASU 2022-02, which eliminated the accounting and recognition of troubled debt restructurings ("TDRs").

18

	December 31, 2022
	Commercial Real Estate								Residential Real Estate
(In thousands)	Commercial Investor R/E		Commercial Owner- Occupied R/E		Commercial AD&C		Commercial Business		Residential Mortgage		Residential Construction		Consumer		Total
Performing loans:
Current	$	5,104,204	$	1,767,875	$	1,090,028	$	1,443,012	$	1,261,878	$	222,144	$	422,989	$	11,312,130
30-59 days	9,735		1,007		—		3,556		11,307		2,628		4,343		32,576
60-89 days	6,212		—		—		41		5,822		—		566		12,641
Total performing loans	5,120,151		1,768,882		1,090,028		1,446,609		1,279,007		224,772		427,898		11,357,347
Non-performing loans:
Non-accrual loans	9,943		5,019		—		7,322		7,439		—		5,059		34,782
Loans greater than 90 days past due	—		—		—		1,002		—		—		—		1,002
Restructured loans	—		1,136		—		952		1,487		—		—		3,575
Total non-performing loans	9,943		6,155		—		9,276		8,926		—		5,059		39,359
Total loans	$	5,130,094	$	1,775,037	$	1,090,028	$	1,455,885	$	1,287,933	$	224,772	$	432,957	$	11,396,706

The following tables present average principal balance of total non-accrual loans and contractual interest due on non-accrual loans for the periods indicated below:

	For the Six Months Ended June 30, 2023
	Commercial Real Estate								Residential Real Estate
(In thousands)	Commercial Investor R/E		Commercial Owner- Occupied R/E		Commercial AD&C		Commercial Business		Residential Mortgage		Residential Construction		Consumer		Total
Average non-accrual loans for the period	$	15,258	$	4,938	$	190	$	8,719	$	8,842	$	—	$	4,452	$	42,399
Contractual interest income due on non- accrual loans during the period	$	559	$	146	$	24	$	350	$	232	$	—	$	243	$	1,554

	For the Year Ended December 31, 2022
	Commercial Real Estate								Residential Real Estate
(In thousands)	Commercial Investor R/E		Commercial Owner- Occupied R/E		Commercial AD&C		Commercial Business		Residential Mortgage		Residential Construction		Consumer		Total
Average non-accrual loans for the period	$	11,892	$	7,314	$	617	$	7,768	$	7,769	$	21	$	5,811	$	41,192
Contractual interest income due on non- accrual loans during the period	$	713	$	106	$	30	$	491	$	319	$	1	$	349	$	2,009

There was no interest income recognized on non-accrual loans during the six months ended June 30, 2023. See Note 1 for additional information on the Company's policies for non-accrual loans. Loans designated as non-accrual have all previously accrued but unpaid interest reversed from interest income. During the six months ended June 30, 2023 new loans placed on non-accrual status totaled $29.0 million and the related amount of reversed uncollected accrued interest was $0.4 million.

The credit quality indicators for commercial loans are developed through review of individual borrowers on an ongoing basis. Each borrower is evaluated at least annually with more frequent evaluation of more severely criticized loans. The indicators represent the rating for loans as of the date presented is based on the most recent credit review performed. These credit quality indicators are defined as follows:

Pass - A pass rated credit is not adversely classified because it does not display any of the characteristics for adverse classification.

Special mention – A special mention credit has potential weaknesses that deserve management’s close attention. If uncorrected, such weaknesses may result in deterioration of the repayment prospects or collateral position at some future date. Special mention assets are not adversely classified and do not warrant adverse classification.

Substandard – A substandard loan is inadequately protected by the current net worth and payment capacity of the obligor or of the collateral pledged, if any. Loans classified as substandard generally have a well-defined weakness, or weaknesses, that jeopardize the liquidation of the debt. These loans are characterized by the distinct possibility of loss if the deficiencies are not corrected.

19

Doubtful – A loan that is classified as doubtful has all the weaknesses inherent in a loan classified as substandard with added characteristics that the weaknesses make collection or liquidation in full highly questionable and improbable, on the basis of currently existing facts, conditions and values.

Loss – Loans classified as a loss are considered uncollectible and of such little value that their continuing to be carried as a loan is not warranted. This classification is not necessarily equivalent to no potential for recovery or salvage value, but rather that it is not appropriate to defer a full write-off even though partial recovery may be effected in the future.

20

The following table provides information about credit quality indicators by the year of origination as of June 30, 2023:

	June 30, 2023
	Term Loans by Origination Year												Revolving
(In thousands)	2023		2022		2021		2020		2019		Prior		Loans		Total
Commercial Investor R/E:
Pass	$	221,130	$	1,401,988	$	1,210,529	$	689,275	$	552,876	$	958,510	$	24,855	$	5,059,163
Special Mention	6,297		10,298		30,536		—		93		2,880		—		50,104
Substandard	14,799		544		3,663		—		1,377		1,560		—		21,943
Doubtful	—		—		—		—		—		—		—		—
Total	$	242,226	$	1,412,830	$	1,244,728	$	689,275	$	554,346	$	962,950	$	24,855	$	5,131,210
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial Owner-Occupied R/E:
Pass	$	87,454	$	366,576	$	325,147	$	238,899	$	246,174	$	474,408	$	2,184	$	1,740,842
Special Mention	731		739		—		889		323		7,538		—		10,220
Substandard	3,296		3,753		815		351		5,988		4,870		—		19,073
Doubtful	—		—		—		—		—		—		—		—
Total	$	91,481	$	371,068	$	325,962	$	240,139	$	252,485	$	486,816	$	2,184	$	1,770,135
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial AD&C:
Pass	$	189,426	$	318,888	$	284,974	$	78,362	$	1,867	$	15,079	$	154,566	$	1,043,162
Special Mention	1,661		—		—		—		—		—		—		1,661
Substandard	350		569		—		—		—		—		—		919
Doubtful	—		—		—		—		—		—		—		—
Total	$	191,437	$	319,457	$	284,974	$	78,362	$	1,867	$	15,079	$	154,566	$	1,045,742
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial Business:
Pass	$	81,897	$	342,575	$	212,680	$	108,084	$	75,222	$	129,998	$	441,542	$	1,391,998
Special Mention	—		95		204		942		2,172		338		13,398		17,149
Substandard	1,255		2,231		1,766		994		2,581		1,818		3,822		14,467
Doubtful	—		—		—		—		—		—		—		—
Total	$	83,152	$	344,901	$	214,650	$	110,020	$	79,975	$	132,154	$	458,762	$	1,423,614
Current period gross charge-offs	$	—	$	—	$	324	$	—	$	—	$	99			$	423
Residential Mortgage:
Beacon score:
660-850	$	18,644	$	377,467	$	387,642	$	168,643	$	41,092	$	290,758	$	—	$	1,284,246
600-659	—		8,016		13,725		4,075		3,858		29,123		—		58,797
540-599	304		2,915		3,291		523		1,511		8,894		—		17,438
less than 540	—		363		3,006		3,448		3,008		15,437		—		25,262
Total	$	18,948	$	388,761	$	407,664	$	176,689	$	49,469	$	344,212	$	—	$	1,385,743
Current period gross charge-offs	$	—	$	—	$	43	$	—	$	10	$	107	$	—	$	160
Residential Construction:
Beacon score:
660-850	$	9,189	$	135,471	$	36,186	$	5,837	$	150	$	1,244	$	—	$	188,077
600-659	—		973		739		—		—		—		—		1,712
540-599	—		—		401		—		—		—		—		401
less than 540	500		—		—		—		—		—		—		500
Total	$	9,689	$	136,444	$	37,326	$	5,837	$	150	$	1,244	$	—	$	190,690
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Consumer:
Beacon score:
660-850	$	4,743	$	6,164	$	2,515	$	764	$	2,048	$	24,430	$	344,560	$	385,224
600-659	325		543		21		163		113		5,299		12,686		19,150
540-599	309		79		83		38		127		2,293		4,456		7,385
less than 540	224		178		248		291		486		2,750		6,569		10,746
Total	$	5,601	$	6,964	$	2,867	$	1,256	$	2,774	$	34,772	$	368,271	$	422,505
Current period gross charge-offs	$	—	$	1	$	—	$	—	$	—	$	1,594	$	87	$	1,682
Total loans	$	642,534	$	2,980,425	$	2,518,171	$	1,301,578	$	941,066	$	1,977,227	$	1,008,638	$	11,369,639

21

 The following table provides information about credit quality indicators by the year of origination as of December 31, 2022:

	December 31, 2022
	Term Loans by Origination Year												Revolving
(In thousands)	2022		2021		2020		2019		2018		Prior		Loans		Total
Commercial Investor R/E:
Pass	$	1,510,446	$	1,197,504	$	694,756	$	567,247	$	335,103	$	742,405	$	15,242	$	5,062,703
Special Mention	32,661		17,146		468		94		473		4,814		—		55,656
Substandard	557		1,896		—		—		8,239		1,043		—		11,735
Doubtful	—		—		—		—		—		—		—		—
Total	$	1,543,664	$	1,216,546	$	695,224	$	567,341	$	343,815	$	748,262	$	15,242	$	5,130,094
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial Owner-Occupied R/E:
Pass	$	391,340	$	328,657	$	240,738	$	260,114	$	140,841	$	381,386	$	1,167	$	1,744,243
Special Mention	4,567		—		1,301		1,740		2,066		7,323		—		16,997
Substandard	3,219		160		133		6,110		2,010		2,165		—		13,797
Doubtful	—		—		—		—		—		—		—		—
Total	$	399,126	$	328,817	$	242,172	$	267,964	$	144,917	$	390,874	$	1,167	$	1,775,037
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial AD&C:
Pass	$	366,096	$	439,468	$	113,713	$	34,340	$	14,816	$	—	$	119,727	$	1,088,160
Special Mention	1,073		—		—		—		—		—		795		1,868
Substandard	—		—		—		—		—		—		—		—
Doubtful	—		—		—		—		—		—		—		—
Total	$	367,169	$	439,468	$	113,713	$	34,340	$	14,816	$	—	$	120,522	$	1,090,028
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial Business:
Pass	$	330,598	$	223,245	$	95,787	$	105,922	$	77,891	$	78,009	$	508,839	$	1,420,291
Special Mention	127		458		1,107		7,787		498		322		13,225		23,524
Substandard	2,902		1,611		1,094		2,030		449		2,121		1,863		12,070
Doubtful	—		—		—		—		—		—		—		—
Total	$	333,627	$	225,314	$	97,988	$	115,739	$	78,838	$	80,452	$	523,927	$	1,455,885
Current period gross charge-offs	$	174	$	—	$	—	$	—	$	138	$	404	$	—	$	716
Residential Mortgage:
Beacon score:
660-850	$	330,109	$	344,062	$	171,330	$	41,883	$	51,651	$	262,570	$	—	$	1,201,605
600-659	4,571		6,196		1,173		3,925		6,041		24,006		—		45,912
540-599	369		4,013		1,439		1,256		1,931		6,945		—		15,953
less than 540	1,860		3,036		2,892		3,822		2,347		10,506		—		24,463
Total	$	336,909	$	357,307	$	176,834	$	50,886	$	61,970	$	304,027	$	—	$	1,287,933
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	24	$	131	$	—	$	155
Residential Construction:
Beacon score:
660-850	$	131,259	$	75,844	$	12,133	$	150	$	1,432	$	1,245	$	—	$	222,063
600-659	908		373		—		—		—		—		—		1,281
540-599	609		—		—		—		—		—		—		609
less than 540	—		819		—		—		—		—		—		819
Total	$	132,776	$	77,036	$	12,133	$	150	$	1,432	$	1,245	$	—	$	224,772
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Consumer:
Beacon score:
660-850	$	6,689	$	2,346	$	1,201	$	2,147	$	2,047	$	23,170	$	359,468	$	397,068
600-659	658		467		59		198		664		5,459		11,269		18,774
540-599	123		56		—		465		316		2,802		3,824		7,586
less than 540	156		57		40		133		209		2,918		6,016		9,529
Total	$	7,626	$	2,926	$	1,300	$	2,943	$	3,236	$	34,349	$	380,577	$	432,957
Current period gross charge-offs	$	—	$	5	$	15	$	—	$	13	$	20	$	181	$	234
Total loans	$	3,120,897	$	2,647,414	$	1,339,364	$	1,039,363	$	649,024	$	1,559,209	$	1,041,435	$	11,396,706

22

Other Real Estate Owned

Other real estate owned ("OREO") totaled $0.6 million at both June 30, 2023 and December 31, 2022, respectively. There were no consumer mortgage loans secured by residential real estate property for which formal foreclosure proceedings were in process as of June 30, 2023.

Modifications to Borrowers Experiencing Financial Difficulty

Effective January 1, 2023, the Company fully adopted provisions of ASU 2022-02 that eliminated accounting, classification and disclosures of loans modified into troubled debt restructurings.

As a part of our risk management practices, we may consider modifying a loan for a borrower experiencing a financial difficulty that provides a certain degree of a payment relief. Modification types primarily include a reduction in the interest rate or an extension of the existing term. We do not provide modifications that result in the reduction of the outstanding principal balance.

The following table presents the amounts at the end of the reporting period of the loans modified during the period to borrowers experiencing financial difficulty, disaggregated by the loan portfolio segment and type of modification granted:

	For the six months ended June 30, 2023
	Interest rate reduction				Term extension				Total
(in thousands)	Amount		% of total loan segment		Amount		% of total loan segment		Amount		% of total loan segment
Commercial Investor R/E	$	28,340	0.6	%	$	553	—	%	$	28,893	0.6	%
Commercial Owner-Occupied R/E	—		—	%	2,000		0.1	%	2,000		0.1	%
Commercial AD&C	—		—	%	350		—	%	350		—	%
Commercial Business	—		—	%	950		0.1	%	950		0.1	%
All Other loans	—		—	%	—		—	%	—		—	%
Total	$	28,340	0.2	%	$	3,853	—	%	$	32,193	0.3	%

Unfunded loan commitments on modifications for borrowers experiencing financial difficulty totaled $1.2 million at June 30, 2023. These commitments are not included in the table above.

The following table describes the financial effect of the modifications granted to borrowers experiencing financial difficulty during the six months ended June 30, 2023:

	Interest rate reduction	Term extension
Commercial Investor R/E	Reduced weighted average contractual interest rate from 8% to 5%	Added a weighted average of 5 months to the life of loans
Commercial Owner-Occupied R/E	—	Added a weighted average of 8 months to the life of loans
Commercial AD&C	—	Added a weighted average of 9 months to the life of loans
Commercial Business	—	Added a weighted average of 8 months to the life of loans

No loan modifications completed on or after January 1, 2023 for borrowers experiencing financial difficulty had a payment default during the six months ended June 30, 2023

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The following table presents the performance of loans that have been modified during the six months ended June 30, 2023:

	For the six months ended June 30, 2023
(in thousands)	Current		30-89 days past due		90+ days past due		Non-accrual		Total
Commercial Investor R/E	$	28,680	$	213	$	—	$	—	$	28,893
Commercial Owner-Occupied R/E	2,000		—		—		—		2,000
Commercial AD&C	350		—		—		—		350
Commercial Business	950		—		—		—		950
All Other loans	—		—		—		—		—
Total	$	31,980	$	213	$	—	$	—	$	32,193

NOTE 5 – GOODWILL AND OTHER INTANGIBLE ASSETS

The amount of goodwill by reporting units is presented in the following table:

(In thousands)	Community Banking		Investment Management		Total
Balances at December 31, 2022	$	331,689	$	31,747	$	363,436
No activity	—		—		—
Balances at June 30, 2023	$	331,689	$	31,747	$	363,436

The gross carrying amounts and accumulated amortization of intangible assets and goodwill are presented at the dates indicated in the following table:

	June 30, 2023						Weighted Average Remaining Life	December 31, 2022						Weighted Average Remaining Life
(Dollars in thousands)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount			Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Amortizing intangible assets:
Core deposit intangibles	$	29,038	$	(18,486)	$	10,552	6.0 years	$	29,038	$	(16,694)	$	12,344	6.5 years
Other identifiable intangibles	13,906		(7,178)		6,728		8.2 years	13,906		(6,395)		7,511		8.8 years
Total amortizing intangible assets	$	42,944	$	(25,664)	$	17,280		$	42,944	$	(23,089)	$	19,855
Goodwill	$	363,436			$	363,436		$	363,436			$	363,436

The following table presents the estimated future amortization expense for amortizing intangible assets within the years ending December 31:

(In thousands)	Amount
Remaining 2023	$	2,465
2024	4,291
2025	3,530
2026	2,702
2027	1,945
Thereafter	2,347
Total amortizing intangible assets	$	17,280

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NOTE 6 – DEPOSITS

The following table presents the composition of deposits at the dates indicated:

(In thousands)	June 30, 2023		December 31, 2022
Noninterest-bearing deposits	$	3,079,896	$	3,673,300
Interest-bearing deposits:
Demand	1,413,027		1,435,454
Money market savings	2,918,253		3,213,045
Regular savings	731,985		513,360
Time deposits of less than $250,000	2,293,858		1,644,645
Time deposits of $250,000 or more	521,903		473,617
Total interest-bearing deposits	7,879,026		7,280,121
Total deposits	$	10,958,922	$	10,953,421

NOTE 7 – BORROWINGS

Subordinated Debt

On March 15, 2022, the Company completed an offering of $200.0 million aggregate principal amount Fixed to Floating Rate Subordinated Notes due in 2032. The notes bear a fixed interest rate of 3.875% per year through March 29, 2027. Commencing on March 30, 2027, the notes will bear interest at a floating rate per annum equal to the benchmark rate (which is expected to be the three-month SOFR rate) plus a spread of 196.5 basis points, payable quarterly in arrears. The total amount of debt issuance costs incurred was $3.1 million, which are being amortized through the contractual life of the debt. The entire amount of the subordinated debt is considered Tier 2 capital under current regulatory guidelines.

On November 5, 2019, the Company completed an offering of $175.0 million aggregate principal amount Fixed to Floating Rate Subordinated Notes due in 2029. The notes bear a fixed interest rate of 4.25% per year through November 14, 2024. Beginning November 15, 2024, the interest rate will become a floating rate equal to three-month SOFR plus 262 basis points plus a spread adjustment of 0.26261 basis points through the remaining maturity or early redemption date of the notes. The interest will be paid in arrears semi-annually during the fixed rate period and quarterly during the floating rate period. The Company incurred $2.9 million of debt issuance costs which are being amortized through the contractual life of the debt. The entire amount of the subordinated debt is considered Tier 2 capital under current regulatory guidelines.

The following table provides information on subordinated debt as of the date indicated:

(In thousands)	June 30, 2023		December 31, 2022
Fixed to floating rate subordinated debt, 3.875%	$	200,000	$	200,000
Fixed to floating rate subordinated debt, 4.25%	175,000		175,000
Total subordinated debt	375,000		375,000
Less: Debt issuance costs	(4,496)		(4,795)
Long-term borrowings	$	370,504	$	370,205

Other Borrowings

At June 30, 2023 and December 31, 2022, the Company had $74.5 million and $62.0 million, respectively, of outstanding retail repurchase agreements.

The Company had no outstanding federal funds purchased at June 30, 2023 and $260.0 million at December 31, 2022. The available borrowing federal funds capacity under unsecured lines of credit with the correspondent banks was $1.0 billion and $1.6 billion at June 30, 2023 and December 31, 2022, respectively. At June 30, 2023, the Company also had $300.0 million outstanding borrowings through Federal Reserve's Bank Term Funding Program with additional available funds of $16.6 million.

At June 30, 2023, the Company had the ability to pledge collateral at prevailing market rates under a line of credit with the FHLB of $3.2 billion. FHLB availability based on pledged collateral at June 30, 2023, amounted to $2.6 billion, with $600.0 million outstanding. At December 31, 2022, the Company had the ability to pledge collateral at prevailing market rates under a line of credit with the FHLB of $3.2 billion. The availability of FHLB borrowings based on the collateral pledged at December 31, 2022 was $2.6 billion with $550.0 million outstanding.

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Under a blanket lien, the Company has pledged qualifying residential mortgage loans amounting to $1.3 billion, commercial real estate loans amounting to $4.0 billion, home equity lines of credit (“HELOC”) amounting to $214.0 million, and multifamily loans amounting to $571.2 million at June 30, 2023, as collateral under the borrowing agreement with the FHLB. At December 31, 2022, the Company had pledged collateral of qualifying mortgage loans of $1.2 billion, commercial real estate loans of $3.6 billion, HELOC loans of $214.3 million, and multifamily loans of $514.8 million under the FHLB borrowing agreement.

The Company had secured lines of credit available from the Federal Reserve Bank and correspondent banks of $760.8 million and $718.6 million at June 30, 2023 and December 31, 2022, respectively, collateralized by loans, with no borrowings outstanding at the end of either period.

NOTE 8 – STOCKHOLDERS' EQUITY

On March 30, 2022, the Company's board of directors authorized a stock repurchase plan that permits the repurchase of up to $50.0 million of the Company's common stock. During 2022, the Company repurchased and retired 625,710 common shares at an average price of $39.93 per share for the total cost of $25.0 million. The Company did not repurchase any shares of its common stock during the quarter ended June 30, 2023. Under the current authorization, common stock with a total value of up to $25.0 million remains available to be repurchased.

NOTE 9 – SHARE BASED COMPENSATION

The Company’s 2015 Omnibus Incentive Plan ("Omnibus Incentive Plan") was approved on May 6, 2015 and provides for the granting of incentive stock options, non-qualifying stock options, stock appreciation rights, restricted stock grants, restricted stock units and performance share units to selected directors and employees on a periodic basis at the discretion of the Company’s Board of Directors. The Omnibus Incentive Plan authorizes the issuance of up to 1,500,000 shares of common stock, of which 367,726 are available for issuance at June 30, 2023, has a term of 10 years, and is administered by a committee of at least three directors appointed by the Board of Directors. Options granted under the plan have an exercise price which may not be less than 100% of the fair market value of the common stock on the date of the grant and must be exercised within seven or 10 years from the date of grant depending on the terms of the grant agreement. The exercise price of stock options must be paid for in full in cash or shares of common stock, or a combination of both. The board committee has the discretion when making a grant of stock options to impose restrictions on the shares to be purchased upon the exercise of such options. The Company generally issues authorized but previously unissued shares to satisfy option exercises.

Compensation expense is recognized on a straight-line basis over the vesting period of the respective stock option, restricted stock, restricted stock unit grant or performance share units. The Company recognized compensation expense of $2.7 million and $3.2 million for the three months ended June 30, 2023 and 2022, respectively, and of $4.0 million and $4.7 million, for the six months ended June 30, 2023 and 2022, respectively, related to the awards of restricted stock award grants, restricted stock unit grants and performance share unit grants. There was no unrecognized compensation cost related to stock options as of June 30, 2023. The total of unrecognized compensation cost related to restricted stock awards, restricted stock unit grants, and performance share unit grants was approximately $9.5 million as of June 30, 2023. That cost is expected to be recognized over a weighted average period of approximately 2.04 years.

During the six months ended June 30, 2023, the Company granted 276,252 restricted stock units and performance share units, of which 62,124 units are subject to achievement of certain performance conditions measured over a three-year performance period and 214,128 restricted stock units are subject to a three year vesting schedule. The Company did not grant any stock options under the Omnibus Incentive Plan during the six months ended June 30, 2023.

A summary of the activity for the Company’s restricted stock, restricted stock units and performance share units for the period indicated is presented in the following table:

	Number of Common Shares/Units	Weighted Average Grant-Date Fair Value
Non-vested at January 1, 2023	389,475	$	37.44
Granted	276,252	$	27.06
Vested	(201,244)	$	33.40
Forfeited/ cancelled	(6,134)	$	33.97
Non-vested at June 30, 2023	458,349	$	32.99

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A summary of share option activity for the period indicated is reflected in the following table:

	Number of Common Shares	Weighted Average Exercise Share Price		Weighted Average Contractual Remaining Life (Years)	Aggregate Intrinsic Value (in thousands)
Balance at January 1, 2023	144,047	$	16.61	1.6 years	$	2,633
Granted	—	$	—
Exercised	(40,921)	$	12.65		$	474
Forfeited	—	$	—
Expired	(3,338)	$	27.46
Balance at June 30, 2023	99,788	$	17.87	1.4 years	$	804
Exercisable at June 30, 2023	99,788	$	17.87	1.4 years	$	804

NOTE 10 – PENSION PLAN

Defined Benefit Pension Plan

The Company has a qualified, noncontributory, defined benefit pension plan (the “Plan”). Benefits after January 1, 2005 are based on the benefit earned as of December 31, 2004, plus benefits earned in future years of service based on the employee’s compensation during each such year. All benefit accruals for employees were frozen as of December 31, 2007 based on past service and thus salary increases and additional years of service after such date no longer affect the defined benefit provided by the Plan, although additional vesting may continue to occur.

The Company's funding policy is to contribute amounts to the Plan sufficient to meet the minimum funding requirements of the Employee Retirement Income Security Act of 1974 (“ERISA”), as amended. In addition, the Company contributes additional amounts as it deems appropriate based on benefits attributed to service prior to the date of the Plan freeze. The Plan invests primarily in a diversified portfolio of managed fixed income and equity funds.

On March 30, 2022, the Board of Directors approved the termination of the Plan to be effective as of June 30, 2022. The Company has executed plan amendments regarding the Plan termination and has received a determination letter from the Internal Revenue Service (“IRS”) as to the tax-qualified status of the Plan at the time of termination. The Company has also filed appropriate notices and documents related to the Plan’s termination and wind-down with the Pension Benefit Guaranty Corporation (“PBGC”).

The Company will make an additional cash contribution, if necessary, in order to fully fund the Plan on a plan termination basis, followed by the purchase of annuity contracts to transfer its remaining liabilities under the Plan. The actual amount of this cash contribution, if any, will depend upon the nature and timing of participant settlements, as well as prevailing market conditions. In addition, the Company expects to recognize a non-cash pension settlement charge upon settlement of the obligations of the Plan.

All participants who are not already receiving annuities have been given the opportunity to elect a lump sum payout. Benefit obligations of participants who do not elect a lump sum or who are being paid in an annuity form will be transferred under an annuity contract from a highly-rated insurance company that will pay and administer future benefit payments. There will be no change in the benefit earned by Plan participants as a result of these actions. The Company anticipates distributing assets from the Plan in the third quarter of 2023.

The components of net periodic benefit cost for the periods indicated are presented in the following table:

	Three Months Ended June 30,				Six Months Ended June 30,
(In thousands)	2023		2022		2023		2022
Interest cost on projected benefit obligation	$	437	$	326	$	875	$	651
Expected return on plan assets	(373)		(352)		(746)		(705)
Recognized net actuarial loss	226		195		451		391
Net periodic benefit cost	$	290	$	169	$	580	$	337

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The decision as to whether or not to make a plan contribution and the amount of any such contribution is dependent on a number of factors. Such factors include the investment performance of Plan assets in the current economy and, since the Plan is currently frozen, the remaining investment horizon of the Plan. The Company did not make any contribution to the Plan during the six months ended June 30, 2023.

NOTE 11 – NET INCOME PER COMMON SHARE

The calculation of net income per common share for the periods indicated is presented in the following table:

	Three Months Ended June 30,				Six Months Ended June 30,
(Dollars and amounts in thousands, except per share data)	2023		2022		2023		2022
Net income	$	24,745	$	54,800	$	75,998	$	98,735
Distributed and undistributed earnings allocated to participating securities	(33)		(194)		(177)		(476)
Net income attributable to common shareholders	$	24,712	$	54,606	$	75,821	$	98,259
Total weighted average outstanding shares	44,894		45,184		44,860		45,303
Less: Weighted average participating securities	(61)		(160)		(104)		(221)
Basic weighted average common shares	44,833		45,024		44,756		45,082
Dilutive weighted average common stock equivalents	56		87		121		140
Diluted weighted average common shares	44,889		45,111		44,877		45,222
Basic net income per common share	$	0.55	$	1.21	$	1.69	$	2.18
Diluted net income per common share	$	0.55	$	1.21	$	1.69	$	2.17
Anti-dilutive shares	93		—		30		—

NOTE 12 – ACCUMULATED OTHER COMPREHENSIVE LOSS

Comprehensive income/ (loss) is defined as net income/ (loss) plus transactions and other occurrences that are the result of non-owner changes in equity. For Condensed Consolidated Financial Statements presented for the Company, non-owner changes in equity are comprised of unrealized gains or losses on investments available-for-sale and held-to-maturity, and any minimum pension liability adjustments.

The following table presents the activity in net accumulated other comprehensive income/ (loss) and the components of the activity for the periods indicated:

(In thousands)	Unrealized Gains/(Losses) on Debt Securities Available-for-Sale		Defined Benefit Pension Plan		Unrealized Losses on Debt Securities Transferred from Available-for-Sale to Held-to-Maturity		Total
Balance at January 1, 2023	$	(113,513)	$	(8,002)	$	(10,436)	$	(131,951)
Other comprehensive loss before reclassification from accumulated other comprehensive loss, net of tax	5,347		—		—		5,347
Reclassifications from accumulated other comprehensive loss to earnings, net of tax	—		336		643		979
Current period change in other comprehensive loss, net of tax	5,347		336		643		6,326
Balance at June 30, 2023	$	(108,166)	$	(7,666)	$	(9,793)	$	(125,625)

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(In thousands)	Unrealized Gains/ (Losses) on Debt Securities Available-for-Sale		Defined Benefit Pension Plan		Unrealized Losses on Debt Securities Transferred from Available-for-Sale to Held-to-Maturity		Total
Balance at January 1, 2022	$	(336)	$	(8,203)	$	—	$	(8,539)
Other comprehensive income before reclassification, net of tax	(77,922)		—		(12,083)		(90,005)
Reclassifications from accumulated other comprehensive income, net of tax	(34)		291		834		1,091
Current period change in other comprehensive income, net of tax	(77,956)		291		(11,249)		(88,914)
Balance at June 30, 2022	$	(78,292)	$	(7,912)	$	(11,249)	$	(97,453)

The following table provides the information on the reclassification adjustments out of accumulated other comprehensive income/ (loss) for the periods indicated:

	Six Months Ended June 30,
(In thousands)	2023		2022
Unrealized gains on available-for-sale debt securities:
Affected line item in the Statements of Income:
Investment securities gains	$	—	$	46
Income before taxes	—		46
Tax expense	—		(12)
Net income	$	—	$	34
Amortization of unrealized losses on debt securities transferred from available-for-sale to held-to-maturity:
Affected line item in the Statements of Income:
Interest and dividends on investment securities (1)	$	(863)	$	(1,122)
Income before taxes	(863)		(1,122)
Tax benefit	220		288
Net loss	$	(643)	$	(834)
Amortization of defined benefit pension plan items:
Affected line item in the Statements of Income:
Recognized actuarial loss (2)	$	(451)	$	(391)
Income before taxes	(451)		(391)
Tax benefit	115		100
Net loss	$	(336)	$	(291)

(1)Amortization of unrealized losses on held-to-maturity debt securities is fully offset by accretion of a discount on held-to-maturity debt securities with no overall impact on net income and yield.

(2)This amount is included in the computation of net periodic benefit cost. See Note 10 for additional information on the pension plan.

NOTE 13 – LEASES

The Company leases real estate properties for its network of bank branches, financial centers and corporate offices. All of the Company’s leases are currently classified as operating. Most lease agreements include one or more options to renew, with renewal terms that can extend the original lease term from one to twenty years or more. The Company does not sublease any of its leased real estate properties.

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The following table provides information regarding the Company's leases as of the dates indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Components of lease expense:
Operating lease cost (resulting from lease payments)	$	2,712	$	2,738	$	5,427	$	5,504
Supplemental cash flow information related to leases:
Operating cash flows from operating leases	$	2,861	$	2,893	$	5,749	$	5,832
ROU assets obtained in the exchange for lease liabilities due to:
New leases	$	—	$	—	$	703	$	—
Acquisitions	$	—	$	—	$	—	$	—
					June 30, 2023		December 31, 2022
Supplemental balance sheet information related to leases:
Operating lease ROU assets					$	50,397	$	48,910
Operating lease liabilities					$	58,568	$	57,402
Other information related to leases:
Weighted average remaining lease term of operating leases					8.3 years		8.6 years
Weighted average discount rate of operating leases					3.22%		3.02%

 

ROU assets and lease liabilities are recorded in other assets and other liabilities, respectively, in the Condensed Consolidated Statements of Condition.

At June 30, 2023, the maturities of the Company’s operating lease liabilities were as follows:

 

(In thousands)	Amount
Maturity:
Remaining 2023	$	5,740
2024	10,751
2025	9,068
2026	8,320
2027	6,922
Thereafter	26,824
Total undiscounted lease payments	67,625
Less: Present value discount	(9,057)
Lease liability	$	58,568

At June 30, 2023, the Company had one operating lease that has not yet commenced operations and is expected to commence operations during the second half of 2023. The total amount of ROU asset and lease liability at June 30, 2023 was $0.7 million. The Company does not have any lease arrangements with any of its related parties as of June 30, 2023.

NOTE 14 – DERIVATIVES

The Company has entered into interest rate swaps (“swaps”) to facilitate customer transactions and meet their financing needs. These swaps qualify as derivatives, but are not designated as hedging instruments. Interest rate swap contracts involve the risk of dealing with counterparties and their ability to meet contractual terms. When the fair value of a derivative instrument contract is positive, this generally indicates that the counterparty or customer owes the Company and results in credit risk to the Company. When the fair value of a derivative instrument contract is negative, the Company owes the customer or counterparty and, therefore, has no credit risk. The notional value of the swaps outstanding was $334.5 million as of June 30, 2023 compared to $339.1 million as of December 31, 2022. The fair values of swap positions net to zero to minimize the potential impact on the Company’s Condensed Consolidated Financial Statements. Fair values of the swaps are carried as both gross assets and gross liabilities in other assets and other liabilities, respectively, in the Condensed Consolidated Statements of Condition. The

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associated net gains and losses on the swaps are recorded in Other income in the Condensed Consolidated Statements of Income.

NOTE 15 – LITIGATION

In the ordinary course of business, the Company and its subsidiaries are subject to various pending or threatened legal proceedings in which claims for monetary damages are asserted. After consultation with legal counsel, management does not anticipate that the ultimate liability, if any, arising out of these legal matters will have a material adverse effect on the Company's financial condition, operating results or liquidity.

NOTE 16 – FAIR VALUE

GAAP provides entities the option to measure eligible financial assets, financial liabilities and commitments at fair value (i.e. the fair value option), on an instrument-by-instrument basis, that are otherwise not permitted to be accounted for at fair value under other accounting standards. The election to use the fair value option is available when an entity first recognizes a financial asset or financial liability or upon entering into a commitment. Subsequent changes in fair value must be recorded in earnings. The Company applies the fair value option on residential mortgage loans held for sale. The fair value option on residential mortgage loans held for sale allows the recognition of gains on the sale of mortgage loans to more accurately reflect the timing and economics of the transaction.

The standard for fair value measurement establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below.

Basis of Fair Value Measurement:

Level 1- Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2- Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability;

Level 3- Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e. supported by little or no market activity).

A financial instrument’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement.

Changes to interest rates may result in changes in the cash flows due to prepayments or extinguishments. Accordingly, changes to interest rates could result in higher or lower measurements of the fair values.

Assets and Liabilities

Residential mortgage loans held for sale

Residential mortgage loans held for sale are valued based on quotations from the secondary market for similar instruments and are classified as Level 2 in the fair value hierarchy.

Investment securities available-for-sale

U.S. treasuries and government agencies securities and mortgage-backed and asset-backed securities

Valuations are based on active market data and use of evaluated broker pricing models that vary based by asset class and includes available trade, bid, and other market information. Generally, the methodology includes broker quotes, proprietary models, descriptive terms, and databases coupled with extensive quality control programs. Quality control evaluation processes use available market, credit and deal level information to support the evaluation of the security. Additionally, proprietary models and pricing systems, mathematical tools, actual transacted prices, integration of market developments and experienced evaluators are used to determine the value of a security based on a hierarchy of market information regarding a security or securities with similar characteristics. The Company does not adjust the quoted price for such securities. Such instruments are classified within Level 2 in the fair value hierarchy.

State and municipal securities

The Company primarily uses prices obtained from third-party pricing services to determine the fair value of securities. The Company independently evaluates and corroborates the fair value received from pricing services through various methods and techniques, including references to dealer or other market quotes, by reviewing valuations of comparable instruments,

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and by comparing the prices realized on the sale of similar securities. Such securities are classified within Level 2 in the fair value hierarchy.

Interest rate swap agreements

Interest rate swap agreements are measured by alternative pricing sources using a discounted cash flow method that incorporates current market interest rates. Based on the complex nature of interest rate swap agreements, the markets these instruments trade in are not as efficient and are less liquid than that of the more mature Level 1 markets. These characteristics classify interest rate swap agreements as Level 2 in the fair value hierarchy.

Assets Measured at Fair Value on a Recurring Basis

The following tables set forth the Company’s financial assets and liabilities at the dates indicated that were accounted for or disclosed at fair value. Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement:

	June 30, 2023
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
(In thousands)	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Residential mortgage loans held for sale (1)	$	—	$	21,476	$	—	$	21,476
Available-for-sale debt securities:
U.S. treasuries and government agencies	—		94,345		—		94,345
State and municipal	—		268,251		—		268,251
Mortgage-backed and asset-backed	—		781,092		—		781,092
Total available-for-sale debt securities	—		1,143,688		—		1,143,688
Interest rate swap agreements	—		18,286		—		18,286
Total assets	$	—	$	1,183,450	$	—	$	1,183,450
Liabilities:
Interest rate swap agreements	$	—	$	(18,286)	$	—	$	(18,286)
Total liabilities	$	—	$	(18,286)	$	—	$	(18,286)

 (1) The outstanding principal balance for residential loans held for sale as of June 30, 2023 was $21.7 million.

	December 31, 2022
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
(In thousands)	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Residential mortgage loans held for sale (1)	$	—	$	11,706	$	—	$	11,706
Investments available-for-sale:
U.S. treasuries and government agencies	—		93,622		—		93,622
State and municipal	—		265,997		—		265,997
Mortgage-backed and asset-backed	—		854,919		—		854,919
Total investments available-for-sale	—		1,214,538		—		1,214,538
Interest rate swap agreements	—		18,596		—		18,596
Total assets	$	—	$	1,244,840	$	—	$	1,244,840
Liabilities:
Interest rate swap agreements	$	—	$	(18,596)	$	—	$	(18,596)
Total liabilities	$	—	$	(18,596)	$	—	$	(18,596)

 (1) The outstanding principal balance for residential loans held for sale as of December 31, 2022 was $11.3 million.

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Assets Measured at Fair Value on a Nonrecurring Basis

The following tables set forth the Company’s financial assets subject to fair value adjustments on a nonrecurring basis at the date indicated that are valued at the lower of cost or market. Assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement:

	June 30, 2023
(In thousands)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total		Total Losses
Loans	$	—	$	—	$	—	$	—	$	—
Other real estate owned	—		—		611		611		(104)
Total	$	—	$	—	$	611	$	611	$	(104)

	December 31, 2022
(In thousands)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total		Total Losses
Loans (1)	$	—	$	—	$	190	$	190	$	(384)
Other real estate owned	—		—		645		645		(105)
Total	$	—	$	—	$	835	$	835	$	(489)

(1) Amounts represent the fair value of collateral for collateral dependent non-accrual loans allocated to the allowance for credit losses. Fair values are determined using actual market prices (Level 2), independent third-party valuations and borrower records, discounted as appropriate (Level 3).

At June 30, 2023, non-accrual loans totaling $63.5 million had estimated fair value of $47.3 million as a result of individual credit loss allowances of $16.2 million based on the most recent value of the collateral. Collateral dependent loans totaling $26.2 million had an estimated fair value of $19.3 million at December 31, 2022 as a result of individual credit loss allowances of $6.9 million.

Fair value of the collateral dependent loans is measured based on the loan’s observable market price or the fair value of the collateral (less estimated selling costs). Collateral may be real estate and/or business assets such as equipment, inventory and/or accounts receivable. The value of business equipment, inventory and accounts receivable collateral is based on net book value on the business’ financial statements and, if necessary, discounted based on management’s review and analysis. Appraised and reported values may be discounted based on management’s historical experience, changes in market conditions from the time of valuation, and/or management’s expertise and knowledge of the client and client’s business. Collateral dependent loans are reviewed and evaluated on at least a quarterly basis for additional individual reserve and adjusted accordingly, based on the factors identified above.

OREO is adjusted to fair value upon acquisition of the real estate collateral. Subsequently, OREO is carried at the lower of carrying value or fair value. The estimated fair value for OREO included in Level 3 is determined by independent market based appraisals and other available market information, less costs to sell, that may be reduced further based on market expectations or an executed sales agreement. If the fair value of the collateral deteriorates subsequent to initial recognition, the Company records the OREO as a nonrecurring Level 3 adjustment. Valuation techniques are consistent with those techniques applied in prior periods.

Fair Value of Financial Instruments

The Company discloses fair value information, based on the exit price notion, of financial instruments that are not measured at fair value in the financial statements. Fair value is the amount at which a financial instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation, and is best evidenced by a quoted market price, if one exists.

Quoted market prices, where available, are shown as estimates of fair market values. Because no quoted market prices are available for a significant portion of the Company's financial instruments, the fair value of such instruments has been derived based on the amount and timing of future cash flows and estimated discount rates based on observable inputs (“Level 2”) or unobservable inputs (“Level 3”).

33

Present value techniques used in estimating the fair value of many of the Company's financial instruments are significantly affected by the assumptions used. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, could not be realized in immediate cash settlement of the instrument. Additionally, the accompanying estimates of fair values are only representative of the fair values of the individual financial assets and liabilities, and should not be considered an indication of the fair value of the Company. Management utilizes internal models used in asset liability management to determine the fair values disclosed below. Other investments include FRB and FHLB stock, whose carrying amounts approximate fair values based on the redemption provisions of each entity.

The carrying amounts and fair values of the Company’s financial instruments at the dates indicated are presented in the following tables:

					Fair Value Measurements
	June 30, 2023				Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
(In thousands)	Carrying Amount		Estimated Fair Value
Financial assets:
Cash and cash equivalents	$	430,127	$	430,127	$	430,127	$	—	$	—
Residential mortgage loans held for sale	21,476		21,476		—		21,476		—
Available-for-sale debt securities	1,143,688		1,143,688		—		1,143,688		—
Held-to-maturity debt securities	247,814		208,662		—		208,662		—
Other investments	72,052		72,052		—		72,052		—
Loans, net of allowance	11,249,352		10,467,917		—		—		10,467,917
Interest rate swap agreements	18,286		18,286		—		18,286		—
Accrued interest receivable	42,388		42,388		42,388		—		—
Bank owned life insurance	156,874		156,874		—		156,874		—
Financial liabilities:
Time deposits	$	2,815,761	$	2,786,157	$	—	$	2,786,157	$	—
Other deposits	8,143,161		8,143,161		8,143,161		—		—
Securities sold under retail repurchase agreements and
federal funds purchased	374,510		374,510		—		374,510		—
Advances from FHLB	600,000		591,850		—		591,850		—
Subordinated debt	370,504		336,107		—		—		336,107
Interest rate swap agreements	18,286		18,286		—		18,286		—
Accrued interest payable	24,436		24,436		24,436		—		—

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					Fair Value Measurements
	December 31, 2022				Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
(In thousands)	Carrying Amount		Estimated Fair Value
Financial assets:
Cash and cash equivalents	$	192,232	$	192,232	$	192,232	$	—	$	—
Residential mortgage loans held for sale	11,706		11,706		—		11,706		—
Investments available-for-sale	1,214,538		1,214,538		—		1,214,538		—
Held-to-maturity debt securities	259,452		220,123		—		220,123		—
Other investments	69,218		69,218		—		69,218		—
Loans, net of allowance	11,260,464		11,020,992		—		—		11,020,992
Interest rate swap agreements	18,596		18,596		—		18,596		—
Accrued interest receivable	41,172		41,172		41,172		—		—
Bank owned life insurance	153,016		153,016		—		153,016		—
Financial liabilities:
Time deposits	$	2,118,262	$	2,082,319	$	—	$	2,082,319	$	—
Other deposits	8,835,159		8,835,159		8,835,159		—		—
Securities sold under retail repurchase agreements and
federal funds purchased	321,967		321,967		—		321,967		—
Advances from FHLB	550,000		549,530		—		549,530		—
Subordinated debt	370,205		332,470		—		—		332,470
Interest rate swap agreements	18,596		18,596		—		18,596		—
Accrued interest payable	10,867		10,867		10,867		—		—

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Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements

This report, as well as other periodic reports filed with the Securities and Exchange Commission, and written or oral communications made from time to time by or on behalf of Sandy Spring Bancorp, Inc. and its subsidiaries (the “Company”), may contain statements relating to future events or future results of the Company that are considered “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be identified by the use of words such as “believe,” “expect,” “anticipate,” “plan,” “estimate,” “intend” and “potential,” or words of similar meaning, or future or conditional verbs such as “should,” “could,” or “may.” Forward-looking statements include statements of our goals, intentions and expectations; statements regarding our business plans, prospects, growth and operating strategies; statements regarding the quality of our loan and investment portfolios; and estimates of our risks and future costs and benefits.

Forward-looking statements reflect our expectation or prediction of future conditions, events or results based on information currently available. These forward-looking statements are subject to significant risks and uncertainties that may cause actual results to differ materially from those in such statements. These principal risks and uncertainties include, but are not limited to, the risks identified in Item 1A of the Company’s 2022 Annual Report on Form 10-K, Item 1A of Part II of this report and the following:

•changes in general business and economic conditions nationally or in the markets that we serve;

•changes in consumer and business confidence, investor sentiment, or consumer spending or savings behavior;

•changes in the level of inflation;

•changes in the demand for loans, deposits and other financial services that we provide;

•the possibility that future credit losses may be higher than currently expected;

•the impact of the interest rate environment on our business, financial condition and results of operations;

•the impact of compliance with changes in laws, regulations and regulatory interpretations, including changes in income taxes;

•changes in credit ratings assigned to us or our subsidiaries;

•the ability to realize benefits and cost savings from, and limit any unexpected liabilities associated with, any business combinations;

•competitive pressures among financial services companies;

•the ability to attract, develop and retain qualified employees;

•our ability to maintain the security of our data processing and information technology systems;

•the impact of changes in accounting policies, including the introduction of new accounting standards;

•the impact of judicial or regulatory proceedings;

•the impact of fiscal and governmental policies of the United States federal government;

•the impact of health emergencies, epidemics or pandemics;

•the effects of climate change; and

•the impact of natural disasters, extreme weather events, military conflict, terrorism or other geopolitical events.

Forward-looking statements speak only as of the date of this report. The Company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date of this report or to reflect the occurrence of unanticipated events except as required by federal securities laws.

The Company

Sandy Spring Bancorp, Inc. is the bank holding company for Sandy Spring Bank. Throughout this report, references to the

“Company,” “we,” “our,” “us,” and similar terms refer to the consolidated entity consisting of Sandy Spring Bancorp, Inc. and its subsidiaries. “Bancorp” refers solely to the parent holding company, and the “Bank” refers solely to Bancorp’s subsidiary bank, Sandy Spring Bank. Bancorp is the bank holding company for the Bank, which is a community banking organization that focuses its lending and other services on businesses and consumers in the local market area. At June 30, 2023, the Company had $14.0 billion in total assets, compared to $13.8 billion at December 31, 2022. Bancorp is registered as a bank holding company pursuant to the Bank Holding Company Act of 1956, as amended, and is subject to supervision and regulation by the Board of Governors of the Federal Reserve System (the “Federal Reserve”).

The Bank is an independent and community-oriented bank that offers a broad range of commercial banking, retail banking, mortgage and trust services throughout central Maryland, Virginia, and the greater Washington, D.C. market. Through its subsidiaries, West Financial Services, Inc. ("West") and SSB Wealth Management, Inc. (d/b/a Rembert Pendleton Jackson, "RPJ”), the Bank also offers wealth management services. Prior to June 2022, the Company operated Sandy Spring Insurance

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Corporation, a subsidiary of the Bank. Effective June 1, 2022, the Company sold substantially all of the assets of Sandy Spring Insurance Corporation.

The Bank is a state-chartered bank subject to supervision and regulation by the Federal Reserve and the State of Maryland. Deposit accounts of the Bank are insured by the Deposit Insurance Fund administered by the Federal Deposit Insurance Corporation (the “FDIC”) to the maximum amount permitted by law. The Bank is a member of the Federal Reserve System and is an Equal Housing Lender. The Company, the Bank, and its other subsidiaries are Affirmative Action/Equal Opportunity Employers.

Current Quarter Financial Overview

For the quarter ended June 30, 2023 we reported net income of $24.7 million ($0.55 per diluted common share), compared to net income of $54.8 million ($1.21 per diluted common share) for the second quarter of 2022 and $51.3 million ($1.14 per diluted common share) for the first quarter of 2023. The year-over-year decline in quarterly net income was mainly attributable to a $16.7 million gain earned during the prior year quarter associated with the sale of the Company's insurance segment. Excluding this one-time gain, the decrease in net income was due to lower net interest income and non-interest income along with higher non-interest expense. The decline in the current quarter's net income and core earnings compared to the previous quarter was the result of lower net interest income coupled with higher provision for credit losses and the rise in non-interest expense.

Current quarter core earnings were $27.1 million ($0.60 per diluted common share), compared to $52.3 million ($1.16 per diluted common share) for the quarter ended March 31, 2023 and $44.2 million ($0.98 per diluted common share) for the quarter ended June 30, 2022. Core earnings exclude the after-tax impact of amortization of intangibles, investment securities gains or losses and other non-recurring or extraordinary items. The causes of current quarter's decline of core earnings compared to the linked quarter were the same drivers that caused the decrease in net income.

The current quarter reflects the following:

•Total assets at June 30, 2023 remained stable at $14.0 billion compared to $14.1 billion at March 31, 2023.

•Total loans remained at $11.4 billion at June 30, 2023 compared to March 31, 2023. Total commercial real estate and business loans were level quarter-over-quarter, while residential mortgage loans grew 4% due to the migration of construction loans into the residential mortgage portfolio.

•Deposits decreased 1% to $11.0 billion at June 30, 2023 compared to $11.1 billion at March 31, 2023, as noninterest-bearing deposits declined 5%, primarily in commercial checking accounts, while interest-bearing deposits were relatively unchanged, as the 41% and 6% respective growth in savings accounts and time deposits was offset by the 9% decline in money market accounts.

•Total borrowings in the current quarter declined by $28.0 million or 2% over amounts at March 31, 2023. Fed funds purchased and FHLB advances decreased by $205.0 million and $150.0 million, respectively, which was partially offset by $300.0 million of borrowings through the Federal Reserve Bank's Bank Term Funding Program.

•Credit quality metrics remained at low levels during the current quarter compared to the previous quarter. The ratio of non-performing loans to total loans was 0.44% at June 30, 2023 compared to 0.41% at the previous quarter end and 0.40% at June 30, 2022.

•Net interest income for the second quarter of 2023 declined $6.8 million or 7% compared to the previous quarter and $15.5 million or 15% compared to the second quarter of 2022.

•The net interest margin was 2.73% for the second quarter of 2023 compared to 2.99% for the first quarter of 2023 and 3.49% for the second quarter of 2022. Rates paid on interest-bearing liabilities, driven by higher market rates, competition for deposits, and customer movement of excess funds out of noninterest-bearing accounts, outpaced the increase in the yields on interest-earning assets. Compared to the linked quarter, the rate paid on interest-bearing liabilities rose 44 basis points, while the yield on interest-earning assets increased 12 basis points, resulting in the quarterly margin compression of 26 basis points.

•Provision for credit losses directly attributable to the funded loan portfolio was a charge of $4.5 million for the current quarter compared to a credit to provision of $18.9 million in the previous quarter and a charge of $3.0 million in the prior year quarter. During the current quarter, the provision charge was mainly associated with an individual reserve

37

established on one large commercial real estate relationship along with several charge-offs of non-accrual consumer loans. In addition, during the current quarter the Company recorded a provision charge of $0.6 million associated with unfunded loan commitments.

•Non-interest income for the second quarter of 2023 increased by 8% or $1.2 million compared to the linked quarter and declined by 51% or $18.1 million compared to the prior year quarter. Quarter-over-quarter increase was mainly driven by higher income from mortgage banking activities, BOLI income and service charges on deposit accounts. Year-over-year decrease was primarily a result of the sale of the Company's insurance segment during the second quarter of 2022 and the associated $16.7 million gain. Excluding this one-time gain, non-interest income declined by 7% or $1.4 million year-over-year due to lower insurance commission income as a result of the aforementioned sale of the Company's insurance segment and lower bank card fee income due to regulatory restrictions on transaction fees that became effective for the Company in the second half of 2022.

•Non-interest expense for the second quarter of 2023 increased $2.8 million or 4% compared to the first quarter of 2023 and $4.1 million or 6% compared to the prior year quarter. The current quarter's increase was mainly due to a higher compensation expense driven by $1.9 million of severance related expenses associated with staffing adjustments as a part of the broader cost control initiatives implemented by management during the current year.

•Return on average assets (“ROA”) for the quarter ended June 30, 2023 was 0.70% and return on average tangible common equity (“ROTCE”) was 8.93% compared to 1.49% and 19.10%, respectively, for the first quarter of 2023 and 1.69% and 20.83%, respectively, for the second quarter of 2022. On a non-GAAP basis, the current quarter's core ROA was 0.77% and core ROTCE was 9.43% compared to 1.52% and 19.11%, respectively, for the previous quarter and 1.37% and 16.49%, respectively, for the second quarter of 2022.

•The GAAP efficiency ratio was 64.22% for the second quarter of 2023, compared to 58.55% for the first quarter of 2023 and 46.03% for the second quarter of 2022. The non-GAAP efficiency ratio was 60.68% for the second quarter of 2023 compared to 56.87% for the first quarter of 2023 and 49.79% for the prior year quarter. The increase in both the GAAP and non-GAAP efficiency ratios (reflecting a decrease in efficiency) in the current quarter compared to the previous quarter and the second quarter of the prior year was the result of declines in net revenue from the prior periods coupled with the growth in non-interest expense.

Summary of Comparative Second Quarter Results

Balance Sheet and Credit Quality

Total assets increased 5% to $14.0 billion at June 30, 2023, as compared to $13.3 billion at June 30, 2022. At June 30, 2023, total loans were $11.4 billion, a 5% increase compared to $10.8 billion at June 30, 2022. Total commercial loans grew by $393.8 million or 4% during the past twelve months, predominantly in the investor real estate and commercial business segments. Year-over-year the total residential mortgage loan portfolio grew 21%, as a greater number of conventional 1-4 family mortgage and one-year ARM loans were retained to grow the portfolio. Reduced loan demand coupled with lower payoff activity during the current quarter resulted in the loan portfolio remaining level compared to the prior quarter. A modest decline in the commercial loan portfolio was offset by growth in the residential mortgage portfolio.

Deposits remained level from June 30, 2023 compared to June 30, 2022 at $11.0 billion. During the period, run-off of $1.0 billion in noninterest-bearing deposits, in combination with run-off of interest-bearing checking and money market deposits was offset by growth in savings and time deposits. The rotation into higher yielding accounts along with growth in brokered time deposits drove a 15% increase in interest-bearing deposits. Excluding the impact of the increase in brokered time deposits, total deposits declined 7%. Borrowings, primarily advances from the FHLB and borrowings through Federal Reserve Bank's Bank Term Funding Program, have increased by $614.4 million in reaction to the loan growth over the previous year and, more recently, to provide greater on-balance sheet liquidity.

The tangible common equity ratio increased to 8.51% of tangible assets at June 30, 2023, compared to 8.45% at June 30, 2022. This increase reflects the 6% growth in tangible common equity which exceeded the 5% growth in tangible common assets. During the period, the positive impact on tangible common equity was driven by the $82.3 million growth in retained earnings, partially offset by the $28.2 million increase in unrealized losses on available-for-sale securities. The increase in total assets over the preceding twelve months was predominantly due to loan growth. At June 30, 2023, our total risk-based capital ratio was 14.60%, with a common equity tier 1 risk-based capital ratio of 10.65%, a tier 1 risk-based capital ratio of 10.65%, and a tier 1 leverage ratio of 9.42%. All of these ratios remain in excess of the mandated minimum regulatory requirements.

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Non-performing loans include non-accrual loans and accruing loans 90 days or more past due. Credit quality at June 30, 2023 compared to June 30, 2022 remained relatively stable, as the level of non-performing loans to total loans was 0.44% compared to 0.40%. These levels of non-performing loans compare to 0.41% for the prior quarter and continue to be indicative of continued stable credit quality during a period of significant loan growth and economic uncertainty. At June 30, 2023, non-performing loans totaled $49.5 million, compared to $43.5 million at June 30, 2022, and $47.2 million at March 31, 2023. Loans placed on non-accrual during the current quarter amounted to $9.3 million compared to $0.9 million for the prior year quarter and $19.7 million for the first quarter of 2023. We realized net charge-offs of $1.8 million for the second quarter of 2023, as compared to minimal recoveries for the second quarter of 2022 and $0.3 million in recoveries for the first quarter of 2023.

At June 30, 2023, the allowance for credit losses was $120.3 million or 1.06% of outstanding loans and 243% of non-performing loans, compared to $117.6 million or 1.03% of outstanding loans and 249% of non-performing loans at the end of the previous quarter and $113.7 million or 1.05% of outstanding loans and 261% of non-performing loans at the end of the second quarter of 2022. The increase in the allowance for the current quarter compared to the previous quarter mainly reflects an individual reserve recorded on a single commercial real estate relationship. A majority of the other assumptions within the allowance for credit losses were relatively unchanged at June 30, 2023 compared to March 31, 2023.

Quarterly Results of Operations

Net income was $24.7 million ($0.55 per diluted common share) for the three months ended June 30, 2023 compared to $54.8 million ($1.21 per diluted common share) for the prior year quarter. The year-over-year decline in quarterly net income was primarily attributable to a $16.7 million gain earned during the prior year quarter associated with the sale of the our insurance segment. Excluding this one-time gain, the decrease in net income was due to lower net interest income and non-interest income along with higher non-interest expense.

Net interest income decreased $15.5 million or 15% for the second quarter of 2023, compared to the second quarter of 2022, as the $44.2 million growth in interest income was more than offset by interest expense growth of $59.7 million. The provision for credit losses was $5.1 million for the second quarter of 2023 compared to $3.0 million for the second quarter of 2022. Non-interest income for the current quarter decreased by 51% or $18.1 million compared to the prior year quarter. Excluding the gain earned for the sale of the insurance segment, the comparative quarter decline was the cumulative result of the decrease in income from mortgage banking activities reflecting the impact of the economic environment, lower wealth management income driven by market performance, the decline in insurance commission income as a result of the disposition of our insurance business, and reduced bankcard income. Non-interest expense increased $4.1 million or 6% for the second quarter of 2023, compared to the prior year quarter driven primarily by increases in compensation and benefits, the FDIC insurance assessment and professional fees.

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Results of Operations

For the Six Months Ended June 30, 2023 Compared to the Six Months Ended June 30, 2022

We recorded net income of $76.0 million for the six months ended June 30, 2023 compared to $98.7 million for the prior year. Core earnings were $79.4 million for the six months ended June 30, 2023 compared to $89.3 million for the prior year. Year-to-date net income and core earnings declined as a result of lower net interest income, as the growth in interest expense exceeded the increase in interest income, coupled with the decline in non-interest income and higher non-interest expense. The provision for credit losses for the current year-to-date was a credit of $16.5 million as compared to a charge to the provision of $4.7 million for the same period of 2022. Core earnings exclude the after-tax impact of amortization of intangibles, investment securities gains or losses and other non-recurring or extraordinary items. The prior year period's core earnings also exclude the gain from the disposal of our insurance business and the associated transaction costs. Pre-tax, pre-provision net income was $85.5 million for the six months ended June 30, 2023 compared to $136.1 million for the prior year period.

Net Interest Income

For the six months ended June 30, 2023, net interest income decreased $19.6 million compared to the prior year as a result of the $109.2 million increase in interest expense, partially offset by the $89.6 million increase in interest income. Interest expense growth was primarily due to the additional interest expense associated with money market and time deposit accounts and, to a lesser degree, FHLB and Federal Reserve Bank borrowings. Our net interest margin declined to 2.86% for the six months ended June 30, 2023, compared to 3.49% for the prior year, primarily as a result of higher funding cost due to the rising interest rate environment and market competition for deposits over the period. On a tax-equivalent basis, net interest income for the six months ended June 30, 2023 declined to $189.7 million compared to $209.3 million for the six months ended June 30, 2022 as a result of the aforementioned increase in interest expense. During the period, tax-equivalent interest and fees on loans increased $89.7 million or 40%, driven predominantly by commercial loans, offset by the $109.2 million increase in interest expense compared to the prior year period.

The following tables provide an analysis of net interest income performance that, for the comparative period, the average yield on earning assets improved 99 basis points while the average rate paid on interest-bearing liabilities rose 237 basis points, resulting in margin compression of 63 basis points.

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Consolidated Average Balances, Yields and Rates

	Six Months Ended June 30,
	2023						2022
(Dollars in thousands and tax-equivalent)	Average Balances		Interest (1)		Annualized Average Yield/Rate		Average Balances		Interest (1)		Annualized Average Yield/Rate
Assets:
Commercial investor real estate loans	$	5,141,447	$	116,585	4.57	%	$	4,367,400	$	86,782	4.01	%
Commercial owner-occupied real estate loans	1,771,369		40,173		4.57		1,705,562		37,842		4.47
Commercial AD&C loans	1,069,927		40,502		7.63		1,099,498		22,320		4.09
Commercial business loans	1,443,030		44,915		6.28		1,353,446		32,174		4.79
Total commercial loans	9,425,773		242,175		5.18		8,525,906		179,118		4.24
Residential mortgage loans	1,330,912		23,375		3.51		1,017,741		16,652		3.27
Residential construction loans	217,419		3,622		3.36		209,264		3,267		3.15
Consumer loans	423,711		15,912		7.57		422,929		7,581		3.61
Total residential and consumer loans	1,972,042		42,909		4.37		1,649,934		27,500		3.34
Total loans (2)	11,397,815		285,084		5.04		10,175,840		206,618		4.09
Loans held for sale	12,927		459		7.10		15,155		343		4.53
Taxable securities	1,293,626		13,856		2.14		1,180,168		8,737		1.48
Tax-advantaged securities	365,721		4,458		2.44		471,919		5,633		2.39
Total investment securities (3)	1,659,347		18,314		2.21		1,652,087		14,370		1.74
Interest-bearing deposits with banks	299,606		7,608		5.12		229,257		471		0.41
Federal funds sold	477		8		3.50		650		1		0.43
Total interest-earning assets	13,370,172		311,473		4.69		12,072,989		221,803		3.70
Less: allowance for credit losses - loans	(127,189)						(111,302)
Cash and due from banks	95,776						75,750
Premises and equipment, net	69,202						61,733
Other assets	614,403						685,870
Total assets	$	14,022,364					$	12,785,040
Liabilities and Stockholders' Equity:
Interest-bearing demand deposits	$	1,410,797	$	6,236	0.89	%	$	1,494,809	$	572	0.08	%
Regular savings deposits	557,830		2,260		0.82		553,435		41		0.01
Money market savings deposits	3,170,010		43,854		2.79		3,401,641		2,122		0.13
Time deposits	2,541,784		39,763		3.15		1,355,615		3,353		0.50
Total interest-bearing deposits	7,680,421		92,113		2.42		6,805,500		6,088		0.18
Federal funds purchased and Federal Reserve Bank borrowings	246,354		6,090		4.99		49,271		181		0.74
Repurchase agreements	59,498		205		0.69		127,083		74		0.12
Advances from FHLB	676,823		15,423		4.60		1,915		17		1.74
Subordinated debentures	370,334		7,893		4.26		287,164		6,184		4.31
Total borrowings	1,353,009		29,611		4.41		465,433		6,456		2.80
Total interest-bearing liabilities	9,033,430		121,724		2.72		7,270,933		12,544		0.35
Noninterest-bearing demand deposits	3,308,256						3,880,919
Other liabilities	166,861						146,018
Stockholders' equity	1,513,817						1,487,170
Total liabilities and stockholders' equity	$	14,022,364					$	12,785,040
Tax-equivalent net interest income and spread			$	189,749	1.97	%			$	209,259	3.35	%
Less: tax-equivalent adjustment			1,976						1,858
Net interest income			$	187,773					$	207,401
Interest income/earning assets					4.69	%					3.70	%
Interest expense/earning assets					1.83						0.21
Net interest margin					2.86	%					3.49	%

(1)Tax-equivalent income has been adjusted using the combined marginal federal and state rate of 25.47% and 25.64% for 2023 and 2022, respectively. The annualized taxable-equivalent adjustments utilized in the above table to compute yields aggregated to $2.0 million and $1.9 million in 2023 and 2022, respectively.

(2)Non-accrual loans are included in the average balances.

(3)Investments available-for-sale are presented at amortized cost.

41

Effect of Volume and Rate Changes on Tax-Equivalent Net Interest Income

The following table analyzes the reasons for the changes from year-to-year in the principal elements that comprise tax-equivalent net interest income:

	2023 vs. 2022						2022 vs. 2021
	Increase Or (Decrease)		Due to Change In Average:*				Increase Or (Decrease)		Due to Change In Average:*
(Dollars in thousands and tax equivalent)			Volume		Rate				Volume		Rate
Interest income from earning assets:
Commercial investor real estate loans	$	29,803	$	16,669	$	13,134	$	10,017	$	14,359	$	(4,342)
Commercial owner-occupied real estate loans	2,331		1,475		856		(198)		1,263		(1,461)
Commercial AD&C loans	18,182		(615)		18,797		1,105		613		492
Commercial business loans	12,741		2,235		10,506		(17,868)		(21,240)		3,372
Residential mortgage loans	6,723		5,428		1,295		(1,526)		(221)		(1,305)
Residential construction loans	355		131		224		99		516		(417)
Consumer loans	8,331		14		8,317		(1,147)		(1,054)		(93)
Loans held for sale	116		(56)		172		(743)		(1,143)		400
Taxable securities	5,119		908		4,211		465		1,513		(1,048)
Tax-exempt securities	(1,175)		(1,289)		114		226		131		95
Interest-bearing deposits with banks	7,137		186		6,951		378		25		353
Federal funds sold	7		—		7		1		—		1
Total tax-equivalent interest income	89,670		25,086		64,584		(9,191)		(5,238)		(3,953)
Interest expense on funding of earning assets:
Interest-bearing demand deposits	5,664		(35)		5,699		110		40		70
Regular savings deposits	2,219		—		2,219		(81)		20		(101)
Money market savings deposits	41,732		(159)		41,891		(595)		9		(604)
Time deposits	36,410		5,159		31,251		(2,027)		(967)		(1,060)
Federal funds purchased and Federal Reserve Bank borrowings	5,909		2,426		3,483		168		12		156
Repurchase agreements	131		(59)		190		(9)		(9)		—
Advances from FHLB	15,406		15,333		73		(2,632)		(2,057)		(575)
Subordinated debentures	1,709		1,780		(71)		1,172		1,287		(115)
Total interest expense	109,180		24,445		84,735		(3,894)		(1,665)		(2,229)
Tax-equivalent net interest income	$	(19,510)	$	641	$	(20,151)	$	(5,297)	$	(3,573)	$	(1,724)

*Variances that are the combined effect of volume and rate, but cannot be separately identified, are allocated to the volume and rate variances based on their respective relative amounts.

Interest Income

The Company's total tax-equivalent interest income increased 40% to $311.5 million for the first six months of 2023 compared to $221.8 million the prior year period as interest income increased in each of the earning asset categories led by the $63.1 million income growth on commercial loans and, to a lesser extent, the $15.4 million growth interest income from residential and consumer loans. Income from commercial loans was predominantly from investor real estate loans and, to a lesser degree, AD&C loans. Increases in interest income also occurred in interest-bearing deposits with banks and investment securities.

Average interest-earning assets rose 11% for the first half of 2023 compared to the first half of 2022 as average loans outstanding increased 12%. During the comparative period, total average commercial real estate loans grew 14% and commercial business loans rose 6%. Average residential mortgage loans increased 31% during the same time period as a greater number of one-year ARM loans were retained to grow the portfolio. Compared to the prior year, the yield on average loans increased 95 basis points. The average balance of the investment portfolio remained stable for the first six months of 2023 compared to the first six months of 2022, resulting in interest income from the investment securities portfolio increasing 27%, as a result of a 47 basis point increase in the yield. Composition of the average investment portfolio shifted to 78% in taxable securities in the current period, as compared to 71% for the prior year period.

The average yield on interest-earning assets grew to 4.69% for the first six month of 2023 compared to 3.70% for the prior year period. Average yields on loans and investment securities, driven by taxable investment yields, increased by 95 and 47 basis

42

points, respectively, compared to the same period of the prior year, reflecting general market interest rates during the previous twelve months.

Interest Expense

For the first six months of 2023 interest expense increased $109.2 million compared to the first six months of 2022. The year-over-year increase was comprised of an $86.0 million increase in deposit interest expense and a $23.2 million increase in borrowing cost. These increases from period to period were driven by the increase in market interest rates coupled with the increase in average balances in deposits and borrowings. The impact of the rise in rates resulted in the average rate on interest-bearing liabilities for the year-to-date rising to 2.72% from 0.35% as compared to the prior year period. During this period, the average balance of time deposits grew significantly, a result of the increase in brokered time deposits to provide funding for loan growth and liquidity and, to a lesser degree, core time deposits, a result of the increase in rates offered on these products. Average noninterest-bearing deposits decreased to 30% of average deposits in the current period compared to 36% in the prior year’s first six months.

Non-interest Income

Non-interest income amounts and trends are presented in the following table for the periods indicated:

	Six Months Ended June 30,				2023/2022		2023/2022
(Dollars in thousands)	2023		2022		$ Change		% Change
Securities gains	$	—	$	46	$	(46)	N/M
Gain on disposal of assets	—		16,699		(16,699)		N/M
Service charges on deposit accounts	4,994		4,793		201		4.2
Mortgage banking activities	3,062		3,781		(719)		(19.0)
Wealth management income	18,023		18,435		(412)		(2.2)
Insurance agency commissions	—		2,927		(2,927)		N/M
Income from bank owned life insurance	2,158		1,498		660		44.1
Bank card fees	865		3,478		(2,613)		(75.1)
Other income	4,025		4,183		(158)		(3.8)
Total non-interest income	$	33,127	$	55,840	$	(22,713)	(40.7)

 N/M - Not meaningful

For the six months ended June 30, 2023, non-interest income decreased 41% to $33.1 million compared to $55.8 million for 2022. During the prior year, Company realized a $16.7 million gain on the sale of its insurance segment. Excluding the gain, non-interest income decreased 15% or $6.0 million, driven by a $2.9 million decrease in insurance commissions, a $2.6 million decrease in bank card fees and a $0.7 million decrease in income from mortgage banking activities. The decline in income from mortgage banking activities is the result of the rising interest rate environment, which continues to limit home sales and refinancing activity. Insurance commission income declined as a result of the disposition of our insurance business during the second quarter of the prior year. Fees from bank cards diminished as a result of regulatory restrictions on transaction fees effective in the second half of the prior year. These decreases in non-interest income year-over-year were partially offset by a $0.7 million increase in BOLI mortality-related income.

Further detail of non-interest income activity for the first six months of 2023 versus 2022 is provided as follows:

•Service charges on deposit accounts increased 4% as the growth in service charge income on commercial demand deposit accounts increased 22% partially offset by the decline in ATM and returned check charges.

•Income from mortgage banking activities decreased 19% as a result of reduced origination and refinancing volume, the continued result of the increase in mortgage lending rates during the comparative period.

•Wealth management income, comprised of income from trust and estate services and investment management fees earned by the Company’s investment management subsidiaries decreased 2%. Overall, total assets under management increased to $5.7 billion at June 30, 2023 compared to $5.2 billion at June 30, 2022.

•Insurance agency commissions decreased 100% due to the sale of the Company's insurance business in June 2022.

•Bank-owned life insurance income increased 44% as a result of mortality related income in the second quarter of the current year.

•Bank card fee income declined 75% as a result of the impact of 2022 regulatory limitations on interchange fees effective for the Company at June 30, 2022.

•Other income decreased by 4% or $0.2 million, the result of the decline in credit-related fees.

43

Non-interest Expense

Non-interest expense amounts and trends are presented in the following table for the periods indicated:

	Six Months Ended June 30,				2023/2022		2023/2022
(Dollars in thousands)	2023		2022		$ Change		% Change
Salaries and employee benefits	$	79,857	$	78,923	$	934	1.2	%
Occupancy expense of premises	9,611		9,768		(157)		(1.6)
Equipment expense	7,877		7,095		782		11.0
Marketing	3,132		2,473		659		26.6
Outside data services	5,367		4,983		384		7.7
FDIC insurance	4,513		2,062		2,451		118.9
Amortization of intangible assets	2,575		2,974		(399)		(13.4)
Merger, acquisition and disposal expense	—		1,067		(1,067)		N/M
Professional fees and services	7,845		4,389		3,456		78.7
Other expenses	14,664		13,404		1,260		9.4
Total non-interest expense	$	135,441	$	127,138	$	8,303	6.5

 N/M - not meaningful

Non-interest expense increased 7% to $135.4 million for the six months ended June 30, 2023, compared to $127.1 million for 2022. The drivers of the increase in non-interest expense were a $3.5 million increase in professional fees, a $2.5 million increase in FDIC insurance, a $1.2 million increase in software expenses, a $0.9 million increase in compensation and benefits, and a $0.7 million increase in marketing expense. Year-over-year increases in both professional fees and software expenses were mainly associated with the Company's investments in technology.

Further detail by category of non-interest expense activity for the first six months of 2023 versus 2022 is provided as follows:

•Salaries and employee benefits, the largest component of non-interest expense, increased 1% or $0.9 million. This increase was driven by the impact of severance related expenses associated with staffing adjustments in the second quarter of the current year.

•Combined occupancy and equipment expenses increased 4% due to higher software costs.

•Marketing expense increased 27% as a result of advertising costs focused on deposit gathering efforts.

•Outside data services expense increased 8% due to the increase in volume-based components of contractual-based services.

•FDIC insurance increased 119% for 2023 as a result of the increase in the assessment rate imposed by the FDIC on all banks beginning in the first quarter of 2023.

•Amortization of intangible assets decreased as a result of the decline in the core deposit intangible amortization of the asset recognized on previous acquisitions.

•Professional fees and services grew 79% as a result of an increase in utilization of IT consulting services to assist in the implementation of enhanced data capabilities and various other software platforms.

•Other non-interest expenses increased $1.3 million due a variety of miscellaneous operating costs.

Income Taxes

The Company had income tax expense of $25.9 million in the first six months of 2023, compared to income tax expense of $32.7 million in the first six months of 2022, as a result of the decrease in current year-to-date pre-tax earnings compared to the prior year's pre-tax earnings. The effective tax rate for the first half of 2023 was 25.4%, compared to a tax rate of 24.9% for the same period in 2022. The increase in the current year's effective tax rate is the result of pre-tax income containing a greater proportion of taxable income compared to the prior year period.

Operating Expense Performance

Management views the GAAP efficiency ratio as an important financial measure of expense performance and cost management. The ratio expresses the level of non-interest expense as a percentage of total revenue (net interest income plus total non-interest income). Lower ratios indicate improved productivity.

Non-GAAP Financial Measures

In addition, we also use a traditional efficiency ratio that is a non-GAAP financial measure of operating expense control and efficiency of operations. Management believes that its traditional efficiency ratio better focuses attention on the operating

44

performance over time than does a GAAP efficiency ratio, and is highly useful in comparing period-to-period operating performance of our core business operations. It is used by management as part of its assessment of its performance in managing non-interest expense. However, this measure is supplemental, and is not a substitute for an analysis of performance based on GAAP measures. The reader is cautioned that the non-GAAP efficiency ratio used by us may not be comparable to GAAP or non-GAAP efficiency ratios reported by other financial institutions.

In general, the efficiency ratio is non-interest expense as a percentage of net interest income plus non-interest income. Non-interest expense used in the calculation of the non-GAAP efficiency ratio excludes merger, acquisition and disposal expense, the amortization of intangibles, and other non-core expenses, such as severance expense or contingent payment expense. Income for the non-GAAP efficiency ratio includes the favorable effect of tax-exempt income, and excludes gain on disposal of assets and securities gains and losses, which vary widely from period to period without appreciably affecting operating expenses, and other non-recurring gains (if any). For the six months ended June 30, 2023, the GAAP efficiency ratio was 61.31% compared to 48.30% for the same period in 2022. The current period's erosion in the GAAP efficiency ratio compared to the prior year period is directly related to the decline in revenues and the rise in non-interest expense during the period. The non-GAAP efficiency ratio for the current year was 58.73% compared to 49.57% for the prior year. The current year’s non-GAAP efficiency ratio compared to the prior year indicates a decline in efficiency and is the result of the 10% decrease in non-GAAP revenue combined with the 6% growth in non-GAAP non-interest expense.

In addition, we use pre-tax, pre-provision net income, as a measure of the level of certain recurring income before taxes. Management believes this provides financial statement users with a useful metric of the run-rate of revenues and expenses that is readily comparable to other financial institutions. This measure is calculated by adding/ (subtracting) the provision (credit) for credit losses and the provision for income taxes back to/from net income. This metric declined for the first six months of 2023 compared to the same period for 2022, due primarily to the decline in net interest income and non-interest income coupled with the increase in non-interest expense.

We have presented core earnings, core earnings per share, core return on average assets ("core ROA") and core return on average tangible common equity ("core ROTCE") in order to present metrics that are more comparable to prior periods to provide an indication of the core performance of the Company year over year. Core earnings reflect net income exclusive of merger, acquisition and disposal expense, amortization of intangible assets, severance expense, contingent payment expense, gain on disposal of assets and investment securities gains, in each case net of tax. Core earnings were $79.4 million ($1.77 per diluted common share) for the six months ended June 30, 2023, compared to $89.3 million ($1.97 per diluted common share) for the six months ended June 30, 2022. Average tangible assets and average tangible common equity represents average assets and average stockholders’ equity, respectively, adjusted for average goodwill and average intangible assets. The ROA for the first six months of 2023 was 1.09% compared to 1.56% for the same period of the prior year. For the six months ended June 30, 2023, the non-GAAP core ROA was 1.14% compared to 1.41% for the same period in the prior year. ROTCE was 13.88% for the first six months of 2023 compared to 18.62% for the first six months of 2022. The non-GAAP core ROTCE was 14.15% for the first six months of 2023 compared to 16.47% for the first six months of 2022.

45

GAAP and Non-GAAP Efficiency Ratios and Measures

	Six Months Ended June 30,
(Dollars in thousands)	2023			2022
Pre-tax pre-provision net income:
Net income	$	75,998		$	98,735
Plus/ (less) non-GAAP adjustments:
Income tax expense	25,942			32,687
Provision/ (credit) for credit losses	(16,481)			4,681
Pre-tax pre-provision net income	$	85,459		$	136,103
Efficiency ratio (GAAP):
Non-interest expense	$	135,441		$	127,138
Net interest income plus non-interest income	$	220,900		$	263,241
Efficiency ratio (GAAP)	61.31		%	48.30		%
Efficiency ratio (non-GAAP):
Non-interest expense	$	135,441		$	127,138
Less non-GAAP adjustments:
Amortization of intangible assets	2,575			2,974
Merger, acquisition and disposal expense	—			1,067
Severance expense	1,939			—
Contingent payment expense	36			—
Non-interest expense - as adjusted	$	130,891		$	123,097
Net interest income plus non-interest income	$	220,900		$	263,241
Plus non-GAAP adjustment:
Tax-equivalent income	1,976			1,858
Less non-GAAP adjustment:
Securities gains	—			46
Gain on disposal of assets	—			16,699
Net interest income plus non-interest income - as adjusted	$	222,876		$	248,354
Efficiency ratio (non-GAAP)	58.73		%	49.57		%

46

GAAP and Non-GAAP Performance Ratios

	Six Months Ended June 30,
(Dollars in thousands)	2023			2022
Core earnings (non-GAAP):
Net income	$	75,998		$	98,735
Plus/ (less) non-GAAP adjustments (net of tax):
Merger, acquisition and disposal expense	—			793
Amortization of intangible assets	1,919			2,211
Severance expense	1,445			—
Gain on disposal of assets	—			(12,417)
Investment securities gains	—			(34)
Contingent payment expense	27			—
Core earnings (non-GAAP)	$	79,389		$	89,288
Core earnings per common share (non-GAAP):
Weighted-average common shares outstanding - diluted (GAAP)	44,876,873			45,223,086
Earnings per diluted common share (GAAP)	$	1.69		$	2.17
Core earnings per diluted common share (non-GAAP)	$	1.77		$	1.97
Core return on average assets (non-GAAP):
Average assets (GAAP)	$	14,022,364		$	12,785,040
Return on average assets (GAAP)	1.09		%	1.56		%
Core return on average assets (non-GAAP)	1.14		%	1.41		%
Return/ Core return on average tangible common equity (non-GAAP):
Net Income (GAAP)	$	75,998		$	98,735
Plus: Amortization of intangible assets (net of tax)	1,919			2,211
Net income before amortization of intangible assets	$	77,917		$	100,946
Core return on average tangible common equity (non-GAAP):
Average assets (GAAP)	$	14,022,364		$	12,785,040
Average goodwill	(363,436)			(369,098)
Average other intangible assets, net	(18,724)			(24,580)
Average tangible assets (non-GAAP)	$	13,640,204		$	12,391,362
Average total stockholders' equity (GAAP)	$	1,513,817		$	1,487,170
Average goodwill	(363,436)			(369,098)
Average other intangible assets, net	(18,724)			(24,580)
Average tangible common equity (non-GAAP)	$	1,131,657		$	1,093,492
Return on average tangible common equity (non-GAAP)	13.88		%	18.62		%
Core return on average tangible common equity (non-GAAP)	14.15		%	16.47		%
Average tangible common equity to average tangible assets (non-GAAP)	8.30		%	8.82		%

47

Results of Operations

For the Three Months Ended June 30, 2023 Compared to the Three Months Ended June 30, 2022

Net income was $24.7 million ($0.55 per diluted common share) for the three months ended June 30, 2023 compared to $54.8 million ($1.21 per diluted common share) for the prior year quarter. Current quarter's core earnings were $27.1 million ($0.60 per diluted common share), compared to $44.2 million ($0.98 per diluted common share) for the quarter ended June 30, 2022. The year-over-year decline in quarterly net income was mainly attributable to a $16.7 million gain earned during the prior year quarter associated with the sale of the Company's insurance segment. Excluding this gain, the decrease in net income was due to lower net interest income and non-interest income along with higher non-interest expense. Net interest income was adversely affected by rising interest rates over the previous twelve months as interest income growth from loan production was more than offset by rising interest expense. Non-interest income decreased as a result of the combination of lower mortgage banking income, reduced wealth management income, the impact of the sale of our insurance business in the prior year which reduced commission income, and lower bankcard fees resulting from the implementation of applicable regulations. Non-interest expense increased 6% driven by compensation costs, FDIC insurance and professional fees in the current quarter compared to the prior year quarter.

Net Interest Income

Net interest income for the second quarter of 2023 decreased $15.5 million or 15% compared to the second quarter of 2022, driven by higher interest expense, a result of higher funding costs, which outpaced growth in interest income. During the past twelve months, loan growth coupled with the rising interest rate environment was primarily responsible for a $44.3 million increase in interest income. This growth in interest income was more than offset by the $59.7 million growth in interest expense as funding costs have also risen in response to the rising rate environment and significant competition for deposits. Interest income growth occurred in all categories of commercial loans and, to a lesser degree, in residential mortgage loans, consumer loans and investment securities. Interest expense grew primarily due to time and money market deposits, as well as the higher cost of borrowings in the current year period compared to the same period of the prior year.

The net interest margin was 2.73% for the second quarter of 2023 compared to 3.49% for the second quarter of 2022. The contraction of the net interest margin for the current quarter was due to the higher rate paid on interest-bearing liabilities, which outpaced the increase in the yield on interest-earning assets. The overall rate and yield increases were driven by the multiple federal funds rate increases that occurred over the preceding twelve months coupled with the competition for deposits in the market, and customer movement of excess funds out of noninterest-bearing accounts into higher yielding products. As compared to the prior year quarter, the yield on interest-earning assets increased 100 basis points, while the rate paid on interest-bearing liabilities rose 250 basis points resulting in the margin compression of 76 basis points. During the comparative period, average interest-earning assets increased by 9% and average interest-bearing liabilities grew by 25%.

At June 30, 2023 and 2022, average total loans comprised 85% of average interest-earning assets for each of the comparative quarters of with an average yield of 5.09% and 4.12%, respectively. In addition, the average yield on investment securities increased to 2.22% for the current quarter compared to 1.83% for the prior year quarter. These portfolio yield movements resulted in the rise in the overall average yield on interest-earning assets to 4.75% at June 30, 2023 from 3.75% at June 30, 2022.

The average rate paid on average interest-bearing liabilities grew by 250 basis points as the average rate paid increased from 0.43% for the second quarter of 2022 to 2.93% for the second quarter of 2023 driven by the 242 basis point increase in the average rate paid on interest-bearing deposits coupled with the 143 basis point increase in the average rate paid on borrowings. The increase in the average rate paid on interest-bearing deposits was driven by increases in rates paid in all deposit categories, while the rise in the average rate paid on borrowings reflects the impact of the use of advances from the FHLB and borrowings from the Federal Reserve Bank through the Bank Term Funding Program, which funded loan growth and provided liquidity over the previous twelve months. Average interest-bearing deposits increased 14% for the current quarter compared to the same period for the prior year, driven by a 92% increase in average time deposits, predominantly brokered time deposits. The percentage of average noninterest-bearing deposits to total average deposits decreased to 29% in the current quarter compared to 37% in the second quarter of 2022 due to the decline in commercial checking deposit balances.

48

Consolidated Average Balances, Yields and Rates
	Three Months Ended June 30,
	2023						2022
(Dollars in thousands and tax-equivalent)	Average Balances		Interest (1)		Annualized Average Yield/Rate		Average Balances		Interest (1)		Annualized Average Yield/Rate
Assets:
Commercial investor real estate loans	$	5,146,632	$	58,784	4.58	%	$	4,512,937	$	45,148	4.01	%
Commercial owner-occupied real estate loans	1,773,039		20,575		4.65		1,727,325		19,410		4.51
Commercial AD&C loans	1,057,205		20,663		7.84		1,096,369		11,727		4.29
Commercial business loans	1,441,489		22,715		6.32		1,334,350		15,820		4.76
Total commercial loans	9,418,365		122,737		5.23		8,670,981		92,105		4.26
Residential mortgage loans	1,353,809		11,957		3.53		1,070,836		8,878		3.32
Residential construction loans	211,590		1,808		3.43		221,031		1,710		3.10
Consumer loans	423,306		8,325		7.89		421,022		3,992		3.80
Total residential and consumer loans	1,988,705		22,090		4.45		1,712,889		14,580		3.41
Total loans (2)	11,407,070		144,827		5.09		10,383,870		106,685		4.12
Loans held for sale	17,480		307		7.04		12,744		145		4.56
Taxable securities	1,289,529		6,848		2.12		1,195,129		4,630		1.55
Tax-advantaged securities	349,795		2,248		2.57		491,052		3,082		2.51
Total investment securities (3)	1,639,324		9,096		2.22		1,686,181		7,712		1.83
Interest-bearing deposits with banks	359,093		4,922		5.50		200,560		358		0.72
Federal funds sold	622		4		2.87		479		1		0.81
Total interest-earning assets	13,423,589		159,156		4.75		12,283,834		114,901		3.75
Less: allowance for credit losses - loans	(117,587)						(112,656)
Cash and due from banks	96,487						84,931
Premises and equipment, net	70,691						62,422
Other assets	621,473						673,161
Total assets	$	14,094,653					$	12,991,692
Liabilities and Stockholders' Equity:
Interest-bearing demand deposits	$	1,439,418	$	3,606	1.00	%	$	1,488,034	$	414	0.11	%
Regular savings deposits	609,721		1,897		1.25		559,906		22		0.02
Money market savings deposits	3,041,652		22,516		2.97		3,376,742		1,497		0.18
Time deposits	2,699,276		23,306		3.46		1,402,777		1,862		0.53
Total interest-bearing deposits	7,790,067		51,325		2.64		6,827,459		3,795		0.22
Federal funds purchased and Federal Reserve Bank borrowings	320,661		4,007		5.01		53,055		166		1.26
Repurchase agreements	58,382		184		1.26		122,728		35		0.11
Advances from FHLB	718,132		8,216		4.59		3,809		17		1.74
Subordinated debentures	370,410		3,947		4.26		369,994		3,946		4.27
Total borrowings	1,467,585		16,354		4.47		549,586		4,164		3.04
Total interest-bearing liabilities	9,257,652		67,679		2.93		7,377,045		7,959		0.43
Noninterest-bearing demand deposits	3,137,971						4,001,762
Other liabilities	163,565						144,849
Stockholders' equity	1,535,465						1,468,036
Total liabilities and stockholders' equity	$	14,094,653					$	12,991,692
Tax-equivalent net interest income and spread			$	91,477	1.82	%			$	106,942	3.32	%
Less: tax-equivalent adjustment			1,006						992
Net interest income			$	90,471					$	105,950
Interest income/earning assets					4.75	%					3.75	%
Interest expense/earning assets					2.02						0.26
Net interest margin					2.73	%					3.49	%

(1)Tax-equivalent income has been adjusted using the combined marginal federal and state rate of 25.47% and 25.64% for 2023 and 2022, respectively. The annualized taxable-equivalent adjustments utilized in the above table to compute yields aggregated to $1.0 million and $1.0 million in 2023 and 2022, respectively.

(2)Non-accrual loans are included in the average balances.

(3)Investments available-for-sale are presented at amortized cost.

49

Interest Income

Total tax-equivalent interest income increased $44.3 million for the second quarter of 2023 compared to the prior year quarter as interest income increased in every major earning asset category led by the increase in commercial loan income growth of $30.6 million. During the comparative period, average interest-earning assets rose 9% over the prior year quarter as average total loans grew 10% and average investment securities declined 3%. Over the past twelve months, average total mortgage loans increased 21%, while average consumer loans stayed relatively unchanged.

The average yield on interest-earning assets improved to 4.75% for the current quarter compared to 3.75% for the same period of the prior year. Average yields on loans and investment securities for the current quarter increased by 97 and 39 basis points, respectively, compared to the prior year quarter, reflecting general market interest rates during the previous twelve months. The increase in the yield on investments was driven primarily by the increase in yields on taxable investments during the period.

Interest Expense

Interest expense increased $59.7 million in the second quarter of 2023 compared to the second quarter of 2022. The increase from period to period was driven by the increase in market interest rates coupled with the increase in average balances in interest-bearing deposits and borrowings. The impact of the rise in rates resulted in the average rate on interest-bearing liabilities for the current quarter rising to 2.93% from 0.43% for the prior year quarter. During this period, total average balance of time deposits grew significantly, a result of the increase in brokered time deposits to provide funding for loan growth and liquidity and, to a lesser degree, core time deposits, a result of the increase in rates offered on these products.

Non-interest Income

Non-interest income amounts and trends are presented in the following table for the periods indicated:

	Three Months Ended June 30,				2023/2022		2023/2022
(Dollars in thousands)	2023		2022		$ Change		% Change
Securities gains	$	—	$	38	$	(38)	N/M
Gain on disposal of assets	—		16,699		(16,699)		N/M
Service charges on deposit accounts	2,606		2,467		139		5.6
Mortgage banking activities	1,817		1,483		334		22.5
Wealth management income	9,031		9,098		(67)		(0.7)
Insurance agency commissions	—		812		(812)		N/M
Income from bank owned life insurance	1,251		703		548		78.0
Bank card fees	447		1,810		(1,363)		(75.3)
Other income	2,024		2,135		(111)		(5.2)
Total non-interest income	$	17,176	$	35,245	$	(18,069)	(51.3)

N/M - Not meaningful

Total non-interest income for the second quarter of 2023 declined by 51% or $18.1 million compared to the prior year quarter. The year-over-year decrease was primarily a result of a sale of the Company's insurance segment during the second quarter of 2022 and the associated $16.7 million gain on sale. Excluding this one-time gain on sale, non-interest income declined by 7% or $1.4 million from the prior year quarter due to the absence of insurance commissions income as a result of the aforementioned sale and lower bank card income due to regulatory restrictions on transaction fees. Those declines were partially offset by the increases in mortgage banking and BOLI income.

Further detail by category of non-interest income activity for the second quarter of 2023 versus the second quarter of 2022 is provided as follows:

•Service charges on deposit accounts increased 6% as commercial service charges increased 25%, partially offset by a decline in ATM and return check charges.

•Income from mortgage banking activities increased by $0.3 million or 23% reflecting increased gains realized on greater sales volumes in the current period.

•Wealth management income declined 1% in the second quarter of 2023 compared to the second quarter of 2022. Overall total assets under management increased to $5.7 billion at June 30, 2023 compared to $5.2 billion at June 30, 2022.

•Income from bank owned life insurance grew 78% as a result of mortality related income during the current quarter.

•Bank card income decreased 75% as a result of the impact of 2022 regulatory limitations on interchange fees effective for the Company at June 30, 2022.

50

Non-interest Expense

Non-interest expense amounts and trends are presented in the following table for the periods indicated:

	Three Months Ended June 30,				2023/2022		2023/2022
(Dollars in thousands)	2023		2022		$ Change		% Change
Salaries and employee benefits	$	40,931	$	39,550	$	1,381	3.5	%
Occupancy expense of premises	4,764		4,734		30		0.6
Equipment expense	3,760		3,559		201		5.6
Marketing	1,589		1,280		309		24.1
Outside data services	2,853		2,564		289		11.3
FDIC insurance	2,375		1,078		1,297		120.3
Amortization of intangible assets	1,269		1,466		(197)		(13.4)
Merger, acquisition and disposal expense	—		1,067		(1,067)		N/M
Professional fees and services	4,161		2,372		1,789		75.4
Other expenses	7,434		7,321		113		1.5
Total non-interest expense	$	69,136	$	64,991	$	4,145	6.4

N/M - Not meaningful

Total non-interest expense for the second quarter of 2023 increased $4.1 million or 6% compared to the second quarter of 2022. The quarterly increase in non-interest expense is mainly attributable to higher compensation and benefits costs associated with $1.9 million of severance expenses related to staffing adjustments made during the current quarter as a part of the broader cost control initiatives implemented by management during the current year. Higher non-interest expense for the current quarter, as compared to the prior year quarter, was also due to higher FDIC insurance expense, higher professional and service fees related to the Company's investments in technology projects, and higher marketing expense associated with targeted advertising campaigns aimed at growing deposit relationships.

Further detail by category of non-expense income activity for the second quarter of 2023 versus the second quarter of 2022 is provided as follows:

•Salaries and employee benefits, the largest component of non-interest expenses, increased $1.4 million or 3% as a result of severance expenses related to staffing adjustments made during the current quarter.

•Occupancy and equipment expenses for the quarter increased a combined 3% as a result of increased software amortization and related expenses.

•FDIC insurance expense increased $1.3 million as a result of a higher assessment rate imposed by the FDIC on all banks effective beginning the first quarter of 2023.

•Professional fees and services increased 75% primarily due to the increase in utilization of IT consulting services.

•Amortization of intangible assets decreased primarily as a result of the decline in the amortization expense for the core deposit intangible asset recognized from previous acquisitions.

•Other non-interest expense increased 2% primarily as a result of a variety of operating costs.

Income Taxes

Income tax expense was $8.7 million in the second quarter of 2023 compared to income tax expense of $18.4 million in the second quarter of 2022. The resulting effective tax rate was 26.0% for the second quarter of 2023 compared to an effective tax rate of 25.1% for the second quarter of 2022. The increase in the current year's effective tax rate is the result of pre-tax income containing a greater proportion of taxable income compared to the prior year period.

Non-GAAP Financial Measures

The GAAP efficiency ratio in the second quarter of 2023 was 64.22% compared to 46.03% for the second quarter of 2022. The non-GAAP efficiency ratio was 60.68% in the second quarter of 2023 compared to 49.79% in the second quarter of 2022. The increase in both the GAAP and non-GAAP efficiency ratios (reflecting a decrease in efficiency) in the current quarter compared to the first quarter of the prior year were the result of declines in net revenue from the prior periods coupled with the growth in non-interest expense. The GAAP and non-GAAP efficiency ratios are reconciled and provided in the following table.

Pre-tax pre-provision net income decreased 49% for the current quarter compared to the prior year quarter due to the combined impact of the declines in net revenues coupled with the increase in non-interest expense. A major contributor to the prior year

51

quarter's net revenues was the $16.7 million gain associated with the sale of our insurance segment. Excluding the gain, pre-tax pre-provision declined 35% in the current quarter compared to the prior year quarter.

Current quarter core earnings were $27.1 million ($0.60 per diluted common share), compared to $44.2 million ($0.98 per diluted common share) for the quarter ended June 30, 2022. Return on average assets for the quarter ended June 30, 2023 was 0.70% and return on average tangible common equity was 8.93% compared to 1.69% and 20.83%, respectively, for the second quarter of 2022. On a non-GAAP basis, the current quarter's core ROA was 0.77% and core ROTCE was 9.43% compared to core ROA of 1.37% and core ROTCE of 16.49% for the second quarter of 2022.

GAAP and Non-GAAP Efficiency Ratios and Measures

	Three Months Ended June 30,
(Dollars in thousands)	2023			2022
Pre-tax pre-provision net income:
Net income	$	24,745		$	54,800
Plus/ (less) non-GAAP adjustments:
Income tax expense	8,711			18,358
Provision/ (credit) for credit losses	5,055			3,046
Pre-tax pre-provision net income	$	38,511		$	76,204
Efficiency ratio (GAAP):
Non-interest expense	$	69,136		$	64,991
Net interest income plus non-interest income	$	107,647		$	141,195
Efficiency ratio (GAAP)	64.22		%	46.03		%
Efficiency ratio (non-GAAP):
Non-interest expense	$	69,136		$	64,991
Less/ (plus) non-GAAP adjustments:
Amortization of intangible assets	1,269			1,466
Merger, acquisition and disposal expense	—			1,067
Severance expense	1,939			—
Non-interest expense - as adjusted	$	65,928		$	62,458
Net interest income plus non-interest income	$	107,647		$	141,195
Plus non-GAAP adjustment:
Tax-equivalent income	1,006			992
Less non-GAAP adjustment:
Securities gains	—			38
Gain on disposal of assets	—			16,699
Net interest income plus non-interest income - as adjusted	$	108,653		$	125,450
Efficiency ratio (non-GAAP)	60.68		%	49.79		%

52

GAAP and Non-GAAP Performance Ratios

	Three Months Ended June 30,
(Dollars in thousands)	2023			2022
Core earnings (non-GAAP):
Net income (GAAP)	$	24,745		$	54,800
Plus/ (less) non-GAAP adjustments (net of tax):
Merger, acquisition and disposal expense	—			793
Amortization of intangible assets	946			1,090
Severance expense	1,445			—
Gain on disposal of assets	—			(12,417)
Investment securities gains	—			(28)
Core earnings (non-GAAP)	$	27,136		$	44,238
Core earnings per common share (non-GAAP):
Weighted-average common shares outstanding - diluted (GAAP)	44,888,759			45,111,693
Earnings per diluted common share (GAAP)	$	0.55		$	1.21
Core earnings per diluted common share (non-GAAP)	$	0.60		$	0.98
Core return on average assets (non-GAAP):
Average assets (GAAP)	$	14,094,653		$	12,991,692
Return on average assets (GAAP)	0.70		%	1.69		%
Core return on average assets (non-GAAP)	0.77		%	1.37		%
Return/ Core return on average tangible common equity (non-GAAP):
Net Income (GAAP)	$	24,745		$	54,800
Plus: Amortization of intangible assets (net of tax)	946			1,090
Net income before amortization of intangible assets	$	25,691		$	55,890
Core return on average tangible common equity (non-GAAP):
Average total stockholders' equity (GAAP)	$	1,535,465		$	1,468,036
Average goodwill	(363,436)			(367,986)
Average other intangible assets, net	(18,074)			(23,801)
Average tangible common equity (non-GAAP)	$	1,153,955		$	1,076,249
Return on average tangible common equity (non-GAAP)	8.93		%	20.83		%
Core return on average tangible common equity (non-GAAP)	9.43		%	16.49		%
Average tangible common equity to average tangible assets (non-GAAP)	8.41		%	8.54		%

53

FINANCIAL CONDITION

Total assets at June 30, 2023 increased 1% to $14.0 billion compared to $13.8 billion at December 31, 2022. Total loan and deposit balances remained relatively flat compared to year-end 2022. During the first six months of 2023, total loans remained relatively stable at $11.4 billion compared to December 31, 2022 as a result of reduced loan demand and lower payoff activity. Deposits remained level at $11.0 billion at June 30, 2023 compared to December 31, 2022. The availability of competitive high yields in savings and time products, in addition to short-term debt securities, led to noninterest-bearing deposits declining 16%. This run-off was compensated by offering higher yielding accounts along with growth in brokered time deposits resulting in an 8% increase in interest-bearing deposits. As part of the strategy for mitigating deposit outflows we provided access to reciprocal deposit arrangements, which provides FDIC deposit insurance for accounts that would otherwise exceed deposit insurance limits. These deposits increased $386.0 million or 82% during the first six months of 2023. The loan to deposit ratio declined to 103.7% at June 30, 2023 from 104.0% at December 31, 2022.

Analysis of Loans

A comparison of the loan portfolio at the dates indicated is presented in the following table:

	June 30, 2023				December 31, 2022				Period-to-Period Change
(Dollars in thousands)	Amount		%		Amount		%		Amount		%
Commercial real estate:
Commercial investor real estate	$	5,131,210	45.1	%	$	5,130,094	45.0	%	$	1,116	N/M
Commercial owner-occupied real estate	1,770,135		15.6		1,775,037		15.5		(4,902)		(0.3)
Commercial AD&C	1,045,742		9.2		1,090,028		9.6		(44,286)		(4.1)
Commercial business	1,423,614		12.5		1,455,885		12.8		(32,271)		(2.2)
Total commercial loans	9,370,701		82.4		9,451,044		82.9		(80,343)		(0.9)
Residential real estate:
Residential mortgage	1,385,743		12.2		1,287,933		11.3		97,810		7.6
Residential construction	190,690		1.7		224,772		2.0		(34,082)		(15.2)
Consumer	422,505		3.7		432,957		3.8		(10,452)		(2.4)
Total residential and consumer loans	1,998,938		17.6		1,945,662		17.1		53,276		2.7
Total loans	$	11,369,639	100.0	%	$	11,396,706	100.0	%	$	(27,067)	(0.2)

N/M - Not meaningful

Total loans remained flat at June 30, 2023 compared to December 31, 2022. The individual loan portfolios remained relatively stable during the period with most of the portfolios reflecting modest declines while residential mortgage portfolios experienced growth. Overall, the lack of loan demand combined with lower payoff activity during the first six months of 2023, as a result of the interest rate environment, resulted in the reduction of loan growth compared to the prior quarter.

54

Analysis of Investment Securities

The composition of investment securities at the periods indicated is presented in the following table:

	June 30, 2023				December 31, 2022				Period-to-Period Change
(Dollars in thousands)	Amount		%		Amount		%		Amount		%
Available-for-sale debt securities:
U.S. treasuries and government agencies	$	94,345	6.5	%	$	93,622	6.1	%	$	723	0.8	%
State and municipal	268,251		18.3		265,997		17.2		2,254		0.8
Mortgage-backed and asset-backed	781,092		53.4		854,919		55.4		(73,827)		(8.6)
Total available-for-sale debt securities	1,143,688		78.2		1,214,538		78.7		(70,850)		(5.8)
Held-to-maturity debt securities:
Mortgage-backed and asset-backed	247,814		16.9		259,452		16.8		(11,638)		(4.5)
Total held-to-maturity debt securities	247,814		16.9		259,452		16.8		(11,638)		(4.5)
Other investments:
Federal Reserve Bank stock	38,961		2.7		38,873		2.6		88		0.2
Federal Home Loan Bank of Atlanta stock	32,414		2.2		29,668		1.9		2,746		9.3
Other	677		—		677		—		—		—
Total other investments	72,052		4.9		69,218		4.5		2,834		4.1
Total securities	$	1,463,554	100.0	%	$	1,543,208	100.0	%	$	(79,654)	(5.2)

The investment portfolio consists primarily of U.S. Treasuries, U.S. Agency securities, U.S. Agency mortgage-backed securities, U.S. Agency collateralized mortgage obligations, asset-backed securities and state and municipal securities. The portfolio is monitored on a continuing basis with consideration given to interest rate trends and the structure of the yield curve and with a frequent assessment of economic projections and analysis. At June 30, 2023, 96% of the investment portfolio was invested in Aaa/AAA or Aa/AA-rated securities. The duration of the portfolio is monitored to ensure the adequacy and ability to meet liquidity demands. The duration of the portfolio decreased to 4.6 years at June 30, 2023 compared to 4.8 years at December 31, 2022. The portfolio possesses low credit risk and provides a source of liquidity necessary to meet loan and operational demands. Any unrealized losses in the U.S. treasuries and government agencies, state and municipal, mortgage-backed and asset-backed available-for-sale debt securities at June 30, 2023 are due to changes in interest rates and not credit-related events. As such, no allowance for credit losses is required at June 30, 2023. Unrealized losses on available-for-sale debt securities are expected to recover over time as these securities approach maturity. The Company does not intend to sell, nor is it more likely than not it will be required to sell, these securities and has sufficient liquidity to hold these securities for an adequate period of time, which may be maturity, to allow for any anticipated recovery in fair value.

Other Earning Assets

Residential mortgage loans held for sale increased to $21.5 million at June 30, 2023, compared to $11.7 million at December 31, 2022, as a result of the associated timing of origination and sales volume that has occurred during the period. We continue to sell a portion of our mortgage loan production in the secondary market. The aggregate of interest-bearing deposits with banks and federal funds sold increased by $229.6 million at June 30, 2023 compared to December 31, 2022, as management increased on-balance sheet liquidity.

55

Deposits

The composition of deposits for the periods indicated is presented in the following table:

	June 30, 2023				December 31, 2022				Period-to-Period Change
(Dollars in thousands)	Amount		%		Amount		%		Amount		%
Noninterest-bearing deposits	$	3,079,896	28.1	%	$	3,673,300	33.5	%	$	(593,404)	(16.2)	%
Interest-bearing deposits:
Demand	1,413,027		12.9		1,435,454		13.1		(22,427)		(1.6)
Money market savings	2,918,253		26.6		3,213,045		29.4		(294,792)		(9.2)
Regular savings	731,985		6.7		513,360		4.7		218,625		42.6
Time deposits of less than $250,000	2,293,858		20.9		1,644,645		15.0		649,213		39.5
Time deposits of $250,000 or more	521,903		4.8		473,617		4.3		48,286		10.2
Total interest-bearing deposits	7,879,026		71.9		7,280,121		66.5		598,905		8.2
Total deposits	$	10,958,922	100.0	%	$	10,953,421	100.0	%	$	5,501	0.1

Deposits and Borrowings

Deposits remained at $11.0 billion at June 30, 2023 compared to December 31, 2022. Core deposits, which exclude brokered relationships, represented 88% of total deposits at the end of the current quarter as compared to 92% at December 31, 2022, reflecting the stability of the core deposit base. At June 30, 2023, retail accounts represented 41% of core deposits while business accounts accounted for 59% of core deposits. No single commercial or retail client represented more than two percent of total deposits at the end of the current period. Total uninsured deposits, including pass-through insured deposits, represented approximately 30% of total deposits at June 30, 2023. Commercial accounts represented 77% of uninsured deposits, while retail accounts accounted for 23% of the uninsured deposit total. The commercial deposit mix continues to be well diversified with no significant concentration in one particular industry or single client.

The availability of high yields in savings products and short-term debt securities during the current quarter resulted in noninterest-bearing deposits declining 16%. Client deployment of noninterest-bearing deposits into higher yielding accounts, along with growth in brokered time deposits, drove an 8% increase in interest-bearing deposits. The Company established strategies to mitigate outflows of uninsured deposits by providing reciprocal deposit arrangements, which provide FDIC deposit insurance for accounts that would otherwise exceed deposit insurance limits. Excluding the increase in brokered time deposits during the current quarter, total deposits declined 4%.

Total borrowings in the current quarter increased by $102.8 million over amounts at December 31, 2022 as management bolstered on-balance sheet liquidity. During the period, the $260.0 million reduction in federal funds purchased was replaced by $300.0 million of borrowings through the Federal Reserve Bank's Bank Term Funding Program.

At June 30, 2023, contingent liquidity, which consists of available FHLB borrowings, available funds through the Federal Reserve Bank's discount window and the Bank Term Funding Program, as well as excess cash and unpledged investment securities totaled $4.4 billion or 132% of uninsured deposits. In addition, the Company also had $1.0 billion in available fed funds, which provided total coverage of 163% of uninsured deposits.

Capital Management

Management monitors historical and projected earnings, dividends, and asset growth, as well as risks associated with the various types of on and off-balance sheet assets and liabilities, in order to determine appropriate capital levels. Total stockholders' equity remained at $1.5 billion at June 30, 2023 compared to at December 31, 2022. During this period, stockholders' equity increased $55.3 million from net income net of dividends paid, coupled with a decline in the accumulated other comprehensive loss during the period of $6.3 million.

56

Risk-Based Capital Ratios

Bank holding companies and banks are required to maintain capital ratios in accordance with guidelines adopted by the federal bank regulators. These guidelines are commonly known as risk-based capital guidelines. The actual regulatory ratios and required ratios for capital adequacy are summarized for the Company in the following table.

	Ratios at		Minimum Regulatory Requirements
	June 30, 2023	December 31, 2022
Tier 1 leverage	9.42%	9.33%	4.00%
Common equity tier 1 capital to risk-weighted assets	10.65%	10.23%	4.50%
Tier 1 capital to risk-weighted assets	10.65%	10.23%	6.00%
Total capital to risk-weighted assets	14.60%	14.20%	8.00%

As of June 30, 2023, the most recent notification from our primary regulator categorized the Bank as a "well-capitalized" institution under the prompt corrective action rules of the Federal Deposit Insurance Act. Designation as a well-capitalized institution under these regulations is not a recommendation or endorsement of the Company or the Bank by federal bank regulators.

The minimum capital level requirements applicable to the Company and the Bank are: (1) a common equity Tier 1 capital ratio of 4.5%; (2) a Tier 1 capital ratio of 6%; (3) a total capital ratio of 8%; and (4) a Tier 1 leverage ratio of 4%. The rules also establish a “capital conservation buffer” of 2.5% above the regulatory minimum capital requirements, which must consist entirely of common equity Tier 1 capital. An institution would be subject to limitations on paying dividends, engaging in share repurchases, and paying discretionary bonuses to executive officers if its capital level falls below the buffer amount. These limitations establish a maximum percentage of eligible retained income that could be utilized for such actions.

Our total capital ratio increased at June 30, 2023 from December 31, 2022 as a result of an increase in Tier 1 capital from earnings while risk weighted assets decreased as loan balances remained flat from December 31, 2022. The Tier 1 ratios and the leverage ratio also improved due to the growth of Tier 1 capital. During 2020, the Company elected to apply the provisions of the CECL deferral transition in the determination of its risk-based capital ratios. At June 30, 2023, the impact of the application of this deferral transition provided an additional $5.8 million in Tier 1 capital and resulted in raising the common equity Tier 1 ratio by five basis points.

Tangible Common Equity

Tangible common equity, tangible assets, and tangible book value per share are non-GAAP financial measures calculated using GAAP amounts. Tangible common equity and tangible assets exclude the balances of goodwill and other intangible assets. Management believes that this non-GAAP financial measure provides information to investors that may be useful in understanding our financial condition. Because not all companies use the same calculation of tangible common equity and tangible assets, this presentation may not be comparable to other similarly titled measures calculated by other companies.

Tangible common equity increased to 8.51% of tangible assets at June 30, 2023, compared to 8.18% at December 31, 2022. This increase reflects the increase in retained earnings from net income net of dividends, and to a lesser degree, the impact from the $6.3 million decrease in the accumulated other comprehensive loss on common equity associated with the fair values in the available-for-sale investment portfolio, partially reduced due to the increase in total assets since December 31, 2022.

A reconciliation of total stockholders’ equity to tangible common equity and total assets to tangible assets along with tangible book value per share, book value per share and related non-GAAP tangible common equity ratio are provided in the following table:

57

Tangible Common Equity Ratio – Non-GAAP

(Dollars in thousands, except per share data)	June 30, 2023			December 31, 2022
Tangible common equity ratio:
Total stockholders' equity	$	1,539,032		$	1,483,768
Goodwill	(363,436)			(363,436)
Other intangible assets, net	(17,280)			(19,855)
Tangible common equity	$	1,158,316		$	1,100,477
Total assets	$	13,994,545		$	13,833,119
Goodwill	(363,436)			(363,436)
Other intangible assets, net	(17,280)			(19,855)
Tangible assets	$	13,613,829		$	13,449,828
Outstanding common shares	44,862,369			44,657,054
Tangible common equity ratio	8.51		%	8.18		%
Book value per common share	$	34.31		$	33.23
Tangible book value per common share	$	25.82		$	24.64

Credit Risk

Our fundamental lending business is based on understanding, measuring and controlling the credit risk inherent in the loan portfolio. Accordingly, our loan portfolio is subject to varying degrees of credit risk. Credit risk entails both general risks, which are inherent in the process of lending, and risk specific to individual borrowers. Our credit risk is mitigated through portfolio diversification, which limits exposure to any single customer, industry or collateral type. Typically, each consumer and residential lending product has a generally predictable level of credit losses based on historical loss experience. Residential mortgage and home equity loans and lines generally have the lowest credit loss experience. Loans secured by personal property, such as auto loans, generally experience medium credit losses. Unsecured loan products, such as personal revolving credit, have the highest credit loss experience and, for that reason, we have chosen not to engage in a significant amount of this type of lending. Credit risk in commercial lending can vary significantly, as losses as a percentage of outstanding loans can shift widely during economic cycles and are particularly sensitive to changing economic conditions. Generally, improving economic conditions result in improved operating results on the part of commercial customers, enhancing their ability to meet their particular debt service requirements. Improvements, if any, in operating cash flows can be offset by the impact of rising interest rates that may occur during improved economic times. Inconsistent economic conditions may have an adverse effect on the operating results of commercial customers, reducing their ability to meet debt service obligations.

To control and manage credit risk, management has a credit process in place to reasonably ensure that credit standards are maintained along with an in-house loan administration, accompanied by various oversight and review procedures. The primary purpose of loan underwriting is the evaluation of specific lending risks and involves the analysis of the borrower’s ability to service the debt as well as the assessment of the value of the underlying collateral. Oversight and review procedures include monitoring the credit quality of the portfolio, providing early identification of potential problem credits and proactive management of problem credits.

We recognize a lending relationship as non-performing when either the loan becomes 90 days delinquent or as a result of factors, such as bankruptcy, interruption of cash flows, etc., considered at the monthly credit committee meeting. Classification as a non-accrual loan is based on a determination that we may not collect all principal and/or interest payments according to contractual terms. When a loan is placed on non-accrual status all accrued but unpaid interest is reversed from interest income. Payments received on non-accrual loans are first applied to the remaining principal balance of the loans. Additional recoveries are credited to the allowance up to the amount of all previous charge-offs.

The level of non-performing loans to total loans increased to 0.44% at June 30, 2023 compared to 0.35% at December 31, 2022. Non-performing loans were $49.5 million at June 30, 2023 compared to $39.4 million at December 31, 2022. Loans placed on non-accrual during the current quarter amounted to $9.3 million compared to $19.7 million for the first quarter of 2023. Loans greater than 90 days or more were $0.7 million at June 30, 2023 compared to $1.0 million at December 31, 2022.

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While the diversification of the lending portfolio among different commercial, residential and consumer product lines along with different market conditions of the D.C. suburbs, Northern Virginia and Baltimore metropolitan area has mitigated some of the risks in the portfolio, local economic conditions and levels of non-performing loans may continue to be influenced by the conditions being experienced in various business sectors of the economy on both a regional and national level.

Our methodology for evaluating whether a loan shall be placed on non-accrual status begins with risk-rating credits on an individual basis and includes consideration of the borrower’s overall financial condition, payment record and available cash resources that may include the sufficiency of collateral value and, in a select few cases, verifiable support from financial guarantors. In measuring a specific allowance, we look primarily to the value of the collateral (adjusted for estimated costs to sell) or projected cash flows generated by the operation of the collateral as the primary sources of repayment of the loan. Consideration is given to the existence of guarantees and the financial strength and wherewithal of the guarantors involved in any loan relationship. Guarantees may be considered as a source of repayment based on the guarantor’s financial condition and payment capacity. Accordingly, absent a verifiable payment capacity, a guarantee alone would not be sufficient to avoid classifying the loan as non-accrual.

Management has established a credit process that dictates that structured procedures be performed to monitor these loans between the receipt of an original appraisal and the updated appraisal. These procedures include the following:

•An internal evaluation is updated periodically to include borrower financial statements and/or cash flow projections.

•The borrower may be contacted for a meeting to discuss an updated or revised action plan which may include a request for additional collateral.

•Re-verification of the documentation supporting our position with respect to the collateral securing the loan.

•At the monthly credit committee meeting the loan may be downgraded and a specific allowance may be decided upon in advance of the receipt of the appraisal.

•Upon receipt of the updated appraisal (or based on an updated internal financial evaluation) the loan balance is compared to the appraisal and a specific allowance is decided upon for the particular loan, typically for the amount of the difference between the appraised value (adjusted for estimated costs to sell) and the loan balance.

•Evaluation of whether adverse changes in the value of the collateral are expected over the remainder of the loan’s expected life.

•We individually assess the allowance for credit losses based on the fair value of the collateral for any collateral dependent loans where the borrower is experiencing financial difficulty or when we determine that the foreclosure is probable. As necessary, we will charge-off the excess of the loan amount over the fair value of the collateral adjusted for the estimated selling costs.

We may extend the maturity of a performing or current loan that may have some inherent weakness associated with the loan. However, we generally follows a policy of not extending maturities on non-performing loans under existing terms. Maturity date extensions only occur under revised terms that clearly place us in a position to increase the likelihood of or assure full collection of the loan under the contractual terms and/or terms at the time of the extension that may eliminate or mitigate the inherent weakness in the loan. These terms may incorporate, but are not limited to additional assignment of collateral, significant balance curtailments/liquidations and assignments of additional project cash flows. Guarantees may be a consideration in the extension of loan maturities. As a general matter, we do not view the extension of a loan to be a satisfactory approach to resolving non-performing credits. On an exception basis, certain performing loans that have displayed some inherent weakness in the underlying collateral values, an inability to comply with certain loan covenants which are not affecting the performance of the credit or other identified weakness may be extended.

We typically sell the majority of its fixed-rate residential mortgage originations in the secondary mortgage market. Concurrent with such sales, we are required to make customary representations and warranties to the purchasers about the mortgage loans and the manner in which they were originated. The related sale agreements grant the purchasers recourse back to us, which could require us to repurchase loans or to share in any losses incurred by the purchasers. This recourse exposure typically extends for a period of six to twelve months after the sale of the loan although the time frame for repurchase requests can extend for an indefinite period. Such transactions could be due to a number of causes including borrower fraud or early payment default. We have received a very limited number of repurchase and indemnity demands from purchasers for such events and routinely monitors its exposure in this regard. We maintain a liability of $0.5 million for probable losses due to repurchases.

Mortgage loan servicing rights are accounted for at amortized cost and are monitored for impairment on an ongoing basis. The amortized cost of our mortgage loan servicing rights was $0.3 million at June 30, 2023 compared to $0.4 million at December 31, 2022.

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Analysis of Credit Risk

The following table presents information with respect to non-performing assets and 90-day delinquencies as of the periods indicated:

(Dollars in thousands)	June 30, 2023			December 31, 2022
Non-accrual loans:
Commercial real estate:
Commercial investor real estate	$	20,381		$	9,943
Commercial owner-occupied real estate	4,846			5,019
Commercial AD&C	569			—
Commercial business	9,393			7,322
Residential real estate:
Residential mortgage	10,153			7,439
Residential construction	—			—
Consumer	3,396			5,059
Total non-accrual loans	48,738			34,782
Loans 90 days past due:
Commercial real estate:
Commercial investor real estate	—			—
Commercial owner-occupied real estate	—			—
Commercial AD&C	—			—
Commercial business	29			1,002
Residential real estate:
Residential mortgage	692			—
Residential construction	—			—
Consumer	—			—
Total 90 days past due loans	721			1,002
Restructured loans (accruing) (1)	—			3,575
Total non-performing loans	49,459			39,359
Other real estate owned, net	611			645
Total non-performing assets	$	50,070		$	40,004
Non-accrual loans to total loans	0.43		%	0.31		%
Non-performing loans to total loans	0.44		%	0.35		%
Non-performing assets to total assets	0.36		%	0.29		%
Allowance for credit losses to non-accrual loans	246.80		%	391.70		%
Allowance for credit losses to non-performing loans	243.21		%	346.15		%

(1) Effective January 1, 2023, the Company adopted ASU 2022-02, which eliminated the accounting and recognition of troubled debt restructurings ("TDRs").

Allowance for Credit Losses - Loans

The allowance for credit losses represents management’s estimate of the portion of our loans’ amortized cost basis not expected to be collected over the loans’ contractual life. As a part of the credit oversight and review process, we maintain an allowance for credit losses (the “allowance”). The following allowance section should be read in conjunction with “Allowance for Credit Losses” section in Note 1 – Significant Accounting Policies in the Notes to the Condensed Consolidated Financial Statements. We exclude accrued interest from the measurement of the allowance as the Company has a non-accrual policy to reverse any accrued, uncollected interest income when loans are placed on non-accrual status.

The appropriateness of the allowance is determined through ongoing evaluation of the credit portfolio, and involves consideration of a number of factors. Determination of the allowance is inherently subjective and requires significant estimates, including consideration of current conditions and future economic forecasts, which may be susceptible to significant volatility. The forecasted economic metrics with the greatest impact were the expected future unemployment rate, the expected level of business bankruptcies and, to a lesser degree, the house price index. In addition to these metrics, management has included the potential impact of recent recessionary pressures among the qualitative factors applied in the determination of the allowance.

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Expected losses can vary significantly from the amounts actually observed. Loans deemed uncollectible are charged off against the allowance, while recoveries are credited to the allowance when received. Management adjusts the level of the allowance through the provision for credit losses in the Condensed Consolidated Statement of Income.

For the six months ended June 30, 2023 our provision for credit losses was a credit of $16.5 million as compared to a charge of $4.7 million for the same period in 2022. The significant credit to the provision for the six months ended June 30, 2023 was a reflection of the improving regional forecast observed during the early part of the current year, coupled with the continued strong credit performance of the loan portfolio.

At June 30, 2023, the allowance for credit losses was $120.3 million as compared to $136.2 million at December 31, 2022. The allowance for credit losses as a percent of total loans was 1.06% and 1.20% at June 30, 2023 and December 31, 2022, respectively. The allowance for credit losses represented 243% of non-performing loans at June 30, 2023 as compared to 346% at December 31, 2022. The allowance attributable to the commercial portfolio represented 1.16% of total commercial loans while the portion attributable to total combined consumer and mortgage loans was 0.59%. With respect to the total commercial portion of the allowance, 26% of this portion is allocated to the commercial business loan portfolio, resulting in the ratio of the allowance for commercial business loans to total commercial business loans of 1.96%. The allowance coverage ratio for the investor real estate portfolio decreased to 1.19% at June 30, 2023 compared to 1.26% at December 31, 2022 as a result of the improved forecasted regional unemployment rate. The ratio of the allowance attributable to AD&C loans was 0.98% at the end of the current quarter, compared to 1.71% at December 31, 2022. This decline in the allowance ratio was predominantly the result of shorter weighted average remaining life of loans in this portfolio.

The current methodology for assessing the appropriate allowance includes: (1) a collective quantified reserve that reflects our historical default and loss experience adjusted for expected economic conditions over a reasonable and supportable forecast period and our prepayment and curtailment rates, (2) collective qualitative factors that consider concentrations of the loan portfolio, expected changes to the economic forecasts, large lending relationships, early delinquencies, and factors related to credit administration, including, among others, loan-to-value ratios, borrowers’ risk rating and credit score migrations, and (3) individual allowances on collateral-dependent loans where borrowers are experiencing financial difficulty or where we determined that foreclosure is probable. Under the current methodology, the impact of the utilization of the historical default and loss experience results in 48% of the total allowance being attributable to the historical performance of the portfolio while 52% of the allowance is attributable to the collective qualitative factors applied to determine the allowance.

The quantified collective portion of the allowance is determined by pooling loans into segments based on the similar risk characteristics of the underlying borrowers, in addition to consideration of collateral type, industry and business purpose of the loans. We selected two collective methodologies, the discounted cash flows and weighted average remaining life methodologies. Segments utilizing the discounted cash flow method are further sub-segmented based on the risk level (determined either by risk ratings or Beacon Scores). Collective calculation methodologies use our historical default and loss experience adjusted for future economic forecasts. The reasonable and supportable forecast period represents a two year economic outlook for the applicable economic variables. Following the end of the reasonable and supportable forecast period expected losses revert back to the historical mean over the next two years on a straight-line basis.

Economic variables which have the most significant impact on the allowance include:

•unemployment rate;

•number of business bankruptcies;

•house price index; and

•consideration of existing economic versus historical conditions.

The collective quantified component of the allowance is supplemented by a qualitative component to address various risk characteristics of our loan portfolio including:

•trends in early delinquencies;

•changes in the risk profile related to large loans in the portfolio;

•concentrations of loans to specific industry segments;

•changes in our credit administration and loan portfolio management processes; and

•the quality of our credit risk identification processes.

The individual reserve assessment is applied to collateral dependent loans where borrowers are experiencing financial difficulty or when we determined that foreclosure is probable. The determination of the fair value of the collateral depends on whether a repayment of the loan is expected to be from the sale or the operation of the collateral. When repayment is expected from the operation of the collateral, we use the present value of expected cash flows from the operation of the collateral as the fair value. When repayment of the loan is expected from the sale of the collateral the fair value of the collateral is based on an observable

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market price or the appraised value less estimated cost to sell. During the individual reserve assessment, management also considers the potential future changes in the value of the collateral over the remainder of the loan’s life. The balance of collateral-dependent loans individually assessed for the allowance was $63.5 million, with individual allowances of $16.2 million against those loans at June 30, 2023.

If an updated appraisal is received subsequent to the preliminary determination of an individual allowance or partial charge-off, and it is less than the initial appraisal used in the initial assessment, an additional individual allowance or charge-off is taken on the related credit. Partially charged-off loans are not written back up based on updated appraisals and always remain on non-accrual with any and all subsequent payments first applied to the remaining balance of the loan as principal reductions. No interest income is recognized on loans that have been partially charged-off.

A current appraisal on large loans is usually obtained if the appraisal on file is more than 12 months old and there has been a material change in market conditions, zoning, physical use or the adequacy of the collateral based on an internal evaluation. Our policy is to strictly adhere to regulatory appraisal standards. If an appraisal is ordered, no more than a 30 day turnaround is requested from the appraiser, who is selected by Credit Administration from an approved appraiser list. After receipt of the updated appraisal, the assigned credit officer will recommend to the Chief Credit Officer whether an individual allowance or a charge-off should be taken. The Chief Credit Officer has the authority to approve an individual allowance or charge-off between monthly credit committee meetings to ensure that there are no significant time lapses during this process. The Company's borrowers are concentrated in nine counties in Maryland, three counties in Virginia and in Washington D.C. Commercial and residential mortgages, including home equity loans and lines, represented 87% of total loans at both June 30, 2023 and at December 31, 2022, respectively. Certain loan terms may create concentrations of credit risk and increase our exposure to loss. These include terms that permit the deferral of principal payments or payments that are smaller than normal interest accruals (negative amortization); loans with high loan-to-value ratios; loans, such as option adjustable-rate mortgages, that may expose the borrower to future increases in repayments that are in excess of increases that would result solely from increases in market interest rates; and interest-only loans. We do not make loans that provide for negative amortization or option adjustable-rate mortgages.

The following table presents an allocation of the allowance for credit losses by portfolio as of each period end. The allowance is allocated in the following table to various loan categories based on the methodology used to estimate credit losses; however, the allocation does not restrict the usage of the allowance for any specific loan category.

(In thousands)	June 30, 2023				December 31, 2022
Commercial real estate:	Amount		% of loans to total loans		Amount		% of loans to total loans
Commercial investor real estate	$	61,087	45.1	%	$	64,737	45.0	%
Commercial owner-occupied real estate	9,230		15.6		11,646		15.5
Commercial AD&C	10,200		9.2		18,646		9.6
Commercial business	27,914		12.5		28,027		12.8
Total commercial	108,431		82.4		123,056		82.9
Residential real estate:
Residential mortgage	9,161		12.2		9,424		11.3
Residential construction	850		1.7		1,337		2.0
Consumer	1,845		3.7		2,425		3.8
Total residential and consumer	11,856		17.6		13,186		17.1
Total allowance for credit losses - loans	$	120,287	100.0	%	$	136,242	100.0	%

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Summary of Loan Credit Loss Experience

The following table presents the activity in the allowance for credit losses on loans for the periods indicated:

	Six Months Ended			Year Ended
(Dollars in thousands)	June 30, 2023			December 31, 2022
Balance, January 1	$	136,242		$	109,145
Provision/ (credit) for credit losses - loans	(14,491)			26,680
Loan charge-offs:
Commercial real estate:
Commercial investor real estate	—			—
Commercial owner-occupied real estate	—			—
Commercial AD&C	—			—
Commercial business	(423)			(716)
Residential real estate:
Residential mortgage	(160)			(155)
Residential construction	—			—
Consumer	(1,682)			(234)
Total charge-offs	(2,265)			(1,105)
Loan recoveries:
Commercial real estate:
Commercial investor real estate	19			320
Commercial owner-occupied real estate	53			49
Commercial AD&C	—			—
Commercial business	187			799
Residential real estate:
Residential mortgage	104			102
Residential construction	—			8
Consumer	438			244
Total recoveries	801			1,522
Net (charge-offs)/ recoveries	(1,464)			417
Balance, period end	$	120,287		$	136,242
Annualized net charge-offs/ (recoveries) to average loans	0.03		%	—		%
Allowance for credit losses on loans to loans	1.06		%	1.20		%

 

Market Risk Management

Our net income is largely dependent on its net interest income. Net interest income is susceptible to interest rate risk to the extent that interest-bearing liabilities mature or re-price on a different basis than interest-earning assets. When interest-bearing liabilities mature or re-price more quickly than interest-earning assets in a given period, a significant increase in market rates of interest could adversely affect net interest income. Similarly, when interest-earning assets mature or re-price more quickly than interest-bearing liabilities, falling interest rates could result in a decrease in net interest income. Net interest income is also affected by changes in the portion of interest-earning assets that are funded by interest-bearing liabilities rather than by other sources of funds, such as noninterest-bearing deposits and stockholders' equity.

Our interest rate risk management goals are (1) to increase net interest income at a growth rate consistent with the growth rate of total assets, and (2) to minimize fluctuations in net interest income as a percentage of interest-earning assets. Management attempts to achieve these goals by balancing, within policy limits, the volume of floating-rate liabilities with a similar volume of floating-rate assets; by keeping the average maturity of fixed-rate asset and liability contracts reasonably matched; by maintaining a pool of administered core deposits; and by adjusting pricing rates to market conditions on a continuing basis.

Our board of directors has established a comprehensive interest rate risk management policy, which is administered by management’s Asset Liability Management Committee (“ALCO”). The policy establishes limits on risk, which are quantitative measures of the percentage change in net interest income (a measure of net interest income or “NII” at risk) and the fair value of equity capital (a measure of economic value of equity or “EVE” at risk) resulting from a hypothetical change in U.S. Treasury interest rates for maturities from one day to thirty years. The Company measures the potential adverse impacts that changing interest rates may have on its short-term earnings, long-term value, and liquidity by employing simulation analysis through the

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use of computer modeling. The simulation model captures optionality factors such as call features and interest rate caps and floors embedded in investment and loan portfolio contracts. As with any method of gauging interest rate risk, there are certain shortcomings inherent in the interest rate modeling methodology used by us. When interest rates change, actual movements in different categories of interest-earning assets and interest-bearing liabilities, loan prepayments, and withdrawals of time and other deposits, may deviate significantly from assumptions used in the model. As an example, certain types of money market deposit accounts are assumed to reprice at 40 to 100% of the interest rate change in each of the up rate shock scenarios even though this is not a contractual requirement. As a practical matter, management would likely lag the impact of any upward movement in market rates on these accounts as a mechanism to manage our net interest margin. Finally, the methodology does not measure or reflect the impact that higher rates may have on adjustable-rate loan customers’ ability to service their debts, or the impact of rate changes on demand for loan and deposit products.

We prepare a current base case and multiple alternative simulations at least once per quarter and reports the analysis to the board of directors. In addition, more frequent forecasts are produced when interest rates are particularly uncertain or when other business conditions, such as periods of economic uncertainty or market liquidity concerns, so dictate.

Our statement of condition is subject to quarterly testing for eight alternative interest rate shock possibilities to indicate the inherent interest rate risk. Average interest rates are shocked by +/- 100, 200, 300, and 400 basis points (“bp”), although we may elect not to use particular scenarios that it determines are impractical in a current rate environment. It is management’s goal to structure the statement of condition so that net interest income at risk over a twelve-month period and the economic value of equity at risk do not exceed policy guidelines at the various interest rate shock levels.

We augment our quarterly interest rate shock analysis with alternative external interest rate scenarios on a monthly basis. These alternative interest rate scenarios may include non-parallel rate ramps and non-parallel yield curve twists. If a measure of risk produced by the alternative simulations of the entire statement of condition violates policy guidelines, ALCO is required to develop a plan to restore the measure of risk to a level that complies with policy limits within two quarters.

Measures of net interest income at risk produced by simulation analysis are indicators of an institution’s short-term performance in alternative rate environments. These measures are typically based upon a relatively brief period, usually one year. They do not necessarily indicate the long-term prospects or economic value of the institution.

Estimated Changes in Net Interest Income
Change in Interest Rates:	+ 400 bp	+ 300 bp	+ 200 bp	+ 100 bp	- 100 bp	- 200 bp	-300 bp	-400 bp
Policy Limit	23.50%	17.50%	15.00%	10.00%	10.00%	15.00%	17.50%	23.50%
June 30, 2023	7.37%	5.56%	3.77%	1.89%	(1.47%)	(3.04%)	(4.89%)	(6.35%)
December 31, 2022	1.87%	1.58%	1.29%	0.75%	(0.89%)	(1.75%)	(2.66%)	(4.17%)

As reflected in the table above, the measures of net interest income at risk at June 30, 2023 increased in all interest scenarios compared to December 31, 2022. The increases in net interest income at risk during the current year are the result of the lengthened maturities of FHLB Advances, brokered time deposits and the $300 million in borrowings under the fixed rate Bank Term Funding Program, coupled with the increase in loan interest income due to higher interest rates. The overall positive impact of these increases were partially offset by a large increase in deposit expense as rates rise.

The measures of equity value at risk indicate our ongoing economic value by considering the effects of changes in interest rates on all of our cash flows, and by discounting the cash flows to estimate the present value of assets and liabilities. The difference between these discounted values of the assets and liabilities is the economic value of equity, which, in theory, approximates the fair value of our net assets.

Estimated Changes in Economic Value of Equity
Change in Interest Rates:	+ 400 bp	+ 300 bp	+ 200 bp	+ 100 bp	- 100 bp	- 200 bp	-300 bp	-400 bp
Policy Limit	35.00%	25.00%	20.00%	10.00%	10.00%	20.00%	25.00%	35.00%
June 30, 2023	(17.59%)	(12.97%)	(8.42%)	(4.07%)	3.76%	6.32%	7.49%	6.03%
December 31, 2022	(20.78%)	(15.84%)	(10.62%)	(5.32%)	5.13%	10.48%	15.71%	18.74%

Overall, the measure of the economic value of equity ("EVE") at risk decreased in all rising rate and declining rate change scenarios from December 31, 2022 to June 30, 2023. This decrease in EVE in rising rate scenarios is a result of higher loan market values from the increase in the portfolio rates and shorter durations, combined with longer weighted average lives on

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deposits, a premium on longer term fixed rate FHLB Advances, and the addition of the fixed rate Bank Term Funding Program. The decrease of the risk in the rising rate scenarios was partially offset by the decline in DDA balances and higher deposit rates. While EVE at risk decreases in declining rate scenarios, its occurs to a lower extent compared to rising rate scenarios, as the causes noted in those scenarios result in an opposite effect on EVE.

Liquidity Management

Liquidity is measured by a financial institution's ability to raise funds through loan repayments, maturing investments, deposit growth, borrowed funds, capital and the sale of highly marketable assets such as investment securities and residential mortgage loans. In assessing liquidity, management considers operating requirements, the seasonality of deposit flows, investment, loan and deposit maturities and calls, expected funding of loans and deposit withdrawals, and the market values of available-for-sale investments, so that sufficient funds are available on a short notice to meet obligations as they arise and to ensure that the we are able to pursue new business opportunities. Accordingly, management evaluates these metrics on a monthly basis to ensure that policy parameters are adequately addressed. The Company performs liquidity stress testing at least quarterly which includes systemic and idiosyncratic scenarios. Testing at the end of the second quarter of 2023 indicated that the Company demonstrates sufficient liquidity in most severe scenarios. As a result of current year trends in the banking industry, management instituted a process to provide greater on-balance sheet liquidity by increasing its available borrowings. At June 30, 2023, our liquidity position, considering both internal and external sources available, exceeded anticipated short-term and long-term needs.

Liquidity is measured using an approach designed to take into account core deposits, in addition to factors already discussed above. Management considers core deposits, defined to include all deposits other than brokered and outsourced deposits, to be a relatively stable funding source. Core deposits equaled 88% of total deposits at June 30, 2023. At March 31, 2023, contingent liquidity amounted to $4.4 billion or 132% of the amount of uninsured deposits, with an additional $1.0 billion in available federal funds which provides total coverage of 163% of uninsured deposits. Although this amount of contingent liquidity does not include any consideration of the held-to-maturity or the available-for-sale investment portfolios, management also considers changes in the liquidity of the investment portfolio due to fluctuations in interest rates when considering total liquidity of the Company. Under this approach, implemented by the Funding and Liquidity Subcommittee of ALCO under formal policy guidelines, our liquidity position is measured weekly, looking forward at thirty day intervals from 30 to 360 days. The measurement is based upon the projection of funds sold or purchased position, along with ratios and trends developed to measure dependence on purchased funds and core growth. At June 30, 2023, our liquidity and funds availability provides it with the requisite flexibility in funding and other liquidity demands.

Our external sources of funds available that can be drawn upon when required are available lines of credit with the FHLB and the Federal Reserve Bank, in addition to the Bank Term Financing Program ("BTF Program"). At June 30, 2023, we had the ability to pledge collateral at prevailing market rates under a line of credit with the FHLB of $3.2 billion. FHLB availability based on pledged collateral at June 30, 2023 amounted to $2.6 billion, with $600.0 million outstanding against it. The secured lines of credit at the Federal Reserve Bank and correspondent banks totaled $760.8 million, all of which was available for borrowing based on pledged collateral, with no borrowings against it as of June 30, 2023. In addition, we have federal funds borrowing capacity under unsecured lines of credit with correspondent banks of $1.0 billion with no amount outstanding at June 30, 2023. The Company has provided $316.5 million in collateral under the BTF Program as a contingent funding source, with $300.0 million in borrowings against it at June 30, 2023. Based upon its liquidity analysis, including external sources of liquidity available, management believes the liquidity position was appropriate at June 30, 2023.

Bancorp is a separate legal entity from the Bank and must provide for its own liquidity. In addition to its operating expenses, Bancorp is responsible for paying any dividends declared to its common shareholders and interest and principal on outstanding debt. Bancorp’s primary source of income is dividends received from the Bank. The amount of dividends that the Bank may declare and pay to Bancorp in any calendar year, without the receipt of prior approval from the Federal Reserve Bank, cannot exceed net income for that year to date period plus retained net income (as defined) for the preceding two calendar years. Quarterly, management evaluates the capacity to pay dividends under various stress scenarios and provides that recommendation to the board of directors. Based on this requirement, as of June 30, 2023, the Bank could have declared a dividend of up to $117.5 million to Bancorp. At June 30, 2023, Bancorp had liquid assets of $83.6 million.

Arrangements to fund credit products or guarantee financing take the form of loan commitments (including lines of credit on revolving credit structures) and letters of credit. Approvals for these arrangements are obtained in the same manner as loans. Generally, cash flows, collateral value and risk assessment are considered when determining the amount and structure of credit arrangements.

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Commitments to extend credit in the form of consumer, commercial real estate and business at the dates indicated were as follows:

(In thousands)	June 30, 2023		December 31, 2022
Commercial real estate development and construction	$	728,839	$	887,154
Residential real estate-development and construction	687,972		798,607
Real estate-residential mortgage	32,090		21,118
Lines of credit, principally home equity and business lines	2,486,317		2,397,533
Standby letters of credit	74,333		77,424
Total commitments to extend credit and available credit lines	$	4,009,551	$	4,181,836

Commitments to extend credit are agreements to provide financing to a customer with the provision that there are no violations of any condition established in the agreement. Commitments generally have interest rates determined by current market rates, expiration dates or other termination clauses and may require payment of a fee. Lines of credit typically represent unused portions of lines of credit that were provided and remain available as long as customers comply with the requisite contractual conditions. Commitments to extend credit are evaluated, processed and/or renewed regularly on a case by case basis, as part of the credit management process. The total commitment amount or line of credit amounts do not necessarily represent future cash requirements, as it is highly unlikely that all customers would draw on their lines of credit in full at one time.

As of June 30, 2023, the total reserve for unfunded commitments was $6.0 million and is accounted for in other liabilities in the Condensed Consolidated Statements of Financial Condition. See Note 1 – Significant Accounting Policies in the Notes to the Condensed Consolidated Financial Statements for more information on the accounting policy for the allowance for unfunded commitments.

66

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

See “Financial Condition - Market Risk Management” in Management’s Discussion and Analysis of Financial Condition and Results of Operations, above, which is incorporated herein by reference.

Item 4. CONTROLS AND PROCEDURES

The Company’s management, under the supervision and with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, evaluated as of the last day of the period covered by this report, the effectiveness of the design and operation of the Company’s disclosure controls and procedures, as defined in Rule 13a-15 under the Securities Exchange Act of 1934. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective. There were no changes in the Company’s internal controls over financial reporting (as defined in Rule 13a-15 under the Securities Act of 1934) during the three months ended June 30, 2023 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

67

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

In the normal course of business, we become involved in litigation arising from the banking, financial and other activities it conducts. Management, after consultation with legal counsel, does not anticipate that the ultimate liability, if any, arising from these matters will have a material effect on our financial condition, operating results or liquidity.

Item 1A. Risk Factors

The most significant risk factors affecting our business include the factors discussed in our Annual Report on Form 10-K for the year ended December 31, 2022 and the Form 10-Q for the quarter ended March 31, 2023 under Item 1A, “Risk Factors” and the following additional risk factor:

Our FDIC deposit insurance premiums and assessments may increase, which would reduce our profitability.

On March 12, 2023, the Department of the Treasury, the Federal Reserve and the FDIC issued a joint statement relating to the resolution of Silicon Valley Bank and Signature Bank that stated that losses to support uninsured deposits of those banks would be recovered via a special assessment on banks. On May 22, 2023, a proposal for comment was issued that outlines the terms of that special assessment where banks with a total of uninsured deposits in excess of $5.0 billion reported as of December 31, 2022 would be subject to that special assessment. At December 31, 2022 the Company's total reported uninsured deposits were $4.4 billion. The effective date of the terms of the proposal would be January 1, 2024. The comment period with respect to this proposal ended July 17, 2023. The announced special assessment, as well as any future increases in assessment rates or required prepayments in FDIC insurance premiums, to the extent that they result in increased deposit insurance costs, would reduce our profitability.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

On March 30, 2022, our board of directors authorized a stock repurchase plan that permits the repurchase of up to $50.0 million of the Company's common stock. During 2022, the Company repurchased 625,710 shares of its common stock at an average price of $39.93 per share. The Company did not repurchase any shares of its common stock during the quarter ended June 30, 2023. Under the current authorization, common stock with a total value of up to $25.0 million remains available to be repurchased.

Item 3. Defaults Upon Senior Securities – None

Item 4. Mine Safety Disclosures – Not applicable

Item 5. Other Information

During the fiscal quarter ended June 30, 2023, none of our directors or officers informed us of the adoption or termination of a “Rule 10b5-1 trading arrangement or “non-Rule 10b5-1 trading arrangement,” as those terms are defined in Item 408 of Regulation S-K.

68

Item 6. Exhibits

  

Exhibit 31(a)	Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a)
Exhibit 31(b)	Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a)
Exhibit 32(a)	Certification of Chief Executive Officer pursuant to 18 U.S. Section 1350
Exhibit 32(b)	Certification of Chief Financial Officer pursuant to 18 U.S. Section 1350
Exhibit 101.SCH	XBRL Taxonomy Extension Schema Document
Exhibit 101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
Exhibit 101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
Exhibit 101.LAB	XBRL Taxonomy Extension Label Linkbase Document
Exhibit 101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document
Exhibit 104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

69

Signatures

Pursuant to the requirements of Section 13 of the Securities Exchange Act of 1934, the Registrant has duly caused this quarterly report to be signed on its behalf by the undersigned, thereunto duly authorized.

SANDY SPRING BANCORP, INC.

(Registrant)

By: /s/ Daniel J. Schrider

Daniel J. Schrider

President and Chief Executive Officer

Date: August 4, 2023

By: /s/ Philip J. Mantua

Philip J. Mantua

Executive Vice President and Chief Financial Officer

Date: August 4, 2023

70

EX-31.A

Exhibit 31 (a)

CERTIFICATION

Rule 13a-14(a) / 15d-14(a) Certifications

I, Daniel J. Schrider, Chief Executive Officer of Sandy Spring Bancorp, Inc. (“Bancorp”), certify that:

1.I have reviewed this quarterly report on Form 10-Q of Sandy Spring Bancorp, Inc.

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a    material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d--15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such  disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based upon such evaluation; and

d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 4, 2023	/s/ Daniel J. Schrider
	Daniel J. Schrider
	President and
	Chief Executive Officer

EX-31.B

Exhibit 31 (b)

CERTIFICATION

I, Philip J. Mantua, Executive Vice President and Chief Financial Officer of Sandy Spring Bancorp, Inc. (“Bancorp”), certify that:

1.I have reviewed this quarterly report on Form 10-Q of Sandy Spring Bancorp, Inc.

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a    material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d--15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such  disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based upon such evaluation; and

d.Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 4, 2023	/s/ Philip J. Mantua
	Philip J. Mantua
	Executive Vice President and
	Chief Financial Officer

EX-32.A

Exhibit 32 (a)

18 U.S.C. Section 1350 Certification

I hereby certify pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, to the best of my knowledge and belief, that the accompanying Form 10-Q of Sandy Spring Bancorp, Inc. (“Bancorp”) for the quarterly period ended June 30, 2023, fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and that the information contained in this Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Bancorp.

By:	/s/ Daniel J. Schrider
	Daniel J. Schrider
	President and Chief Executive Officer
	Date: August 4, 2023

EX-32.B

Exhibit 32 (b)

18 U.S.C. Section 1350 Certification

I hereby certify pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, to the best of my knowledge and belief, that the accompanying Form 10-Q of Sandy Spring Bancorp, Inc. (“Bancorp”) for the quarterly period ended June 30, 2023, fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and that the information contained in this Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Bancorp.

By:	/s/ Philip J. Mantua
	Philip J. Mantua
	Executive Vice President and Chief Financial Officer
	Date: August 4, 2023

XML

Cover - shares	6 Months Ended
	Jun. 30, 2023	Aug. 02, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2023
Document Transition Report	false
Entity File Number	0-19065
Entity Registrant Name	SANDY SPRING BANCORP, INC.
Entity Incorporation State Country Code	MD
Entity Tax Identification Number	52-1532952
Entity Address Address Line1	17801 Georgia Avenue
Entity Address City Or Town	Olney
Entity Address State Or Province	MD
Entity Address Postal Zip Code	20832
City Area Code	301
Local Phone Number	774-6400
Security 12b Title	Common Stock, par value $1.00 per share
Trading Symbol	SASR
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock Shares Outstanding (in shares)		44,862,369
Amendment Flag	false
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q2
Entity Central Index Key	0000824410
Current Fiscal Year End Date	--12-31

XML

CONDENSED CONSOLIDATED STATEMENTS OF CONDITION - UNAUDITED - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Assets:
Cash and due from banks	$ 96,482	$ 88,152
Federal funds sold	240	193
Interest-bearing deposits with banks	333,405	103,887
Cash and cash equivalents	430,127	192,232
Residential mortgage loans held for sale (at fair value)	21,476	11,706
Investments held-to-maturity, at cost (fair value of $208,662 and $220,123, respectively)	247,814	259,452
Investments available-for-sale (at fair value)	1,143,688	1,214,538
Other investments, at cost	72,052	69,218
Total loans	11,369,639	11,396,706
Less: allowance for credit losses - loans	(120,287)	(136,242)
Net loans	11,249,352	11,260,464
Premises and equipment, net	71,203	67,070
Other real estate owned	611	645
Accrued interest receivable	42,388	41,172
Goodwill	363,436	363,436
Other intangible assets, net	17,280	19,855
Other assets	335,118	333,331
Total assets	13,994,545	13,833,119
Liabilities:
Noninterest-bearing deposits	3,079,896	3,673,300
Interest-bearing deposits	7,879,026	7,280,121
Total deposits	10,958,922	10,953,421
Securities sold under retail repurchase agreements	74,510	61,967
Federal funds purchased	0	260,000
Federal Reserve Bank borrowings	300,000	0
Advances from FHLB	600,000	550,000
Subordinated debt	370,504	370,205
Total borrowings	1,345,014	1,242,172
Accrued interest payable and other liabilities	151,577	153,758
Total liabilities	12,455,513	12,349,351
Stockholders' equity:
Common stock	44,862	44,657
Additional paid in capital	737,740	734,273
Retained earnings	882,055	836,789
Accumulated other comprehensive loss	(125,625)	(131,951)
Total stockholders' equity	1,539,032	1,483,768
Total liabilities and stockholders' equity	$ 13,994,545	$ 13,833,119

XML

CONDENSED CONSOLIDATED STATEMENTS OF CONDITION - UNAUDITED - (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Statement of Financial Position [Abstract]
Held-to-maturity debt securities	$ 208,662	$ 220,123
Common stock, par value (in dollars per share)	$ 1.00	$ 1.00
Common stock, shares authorized (in shares)	100,000,000	100,000,000
Common stock, shares issued (in shares)	44,862,369	44,657,054
Common stock, shares outstanding (in shares)	44,862,369	44,657,054

XML

CONDENSED CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Interest income:
Interest and fees on loans	$ 144,274	$ 106,221	$ 284,001	$ 205,715
Interest on loans held for sale	307	145	459	343
Interest on deposits with banks	4,922	358	7,608	471
Interest and dividend income on investment securities:
Taxable	6,848	4,630	13,856	8,737
Tax-advantaged	1,795	2,554	3,565	4,678
Interest on federal funds sold	4	1	8	1
Total interest income	158,150	113,909	309,497	219,945
Interest expense:
Interest on deposits	51,325	3,795	92,113	6,088
Interest on retail repurchase agreements and federal funds purchased	4,191	201	6,295	255
Interest on advances from FHLB	8,216	17	15,423	17
Interest on subordinated debt	3,947	3,946	7,893	6,184
Total interest expense	67,679	7,959	121,724	12,544
Net interest income	90,471	105,950	187,773	207,401
Provision/ (credit) for credit losses	5,055	3,046	(16,481)	4,681
Net interest income after provision/ (credit) for credit losses	85,416	102,904	204,254	202,720
Non-interest income:
Investment securities gains	0	38	0	46
Gain on disposal of assets	0	16,699	0	16,699
Insurance agency commissions	0	812	0	2,927
Income from bank owned life insurance	1,251	703	2,158	1,498
Other income	2,024	2,135	4,025	4,183
Total non-interest income	17,176	35,245	33,127	55,840
Non-interest expense:
Salaries and employee benefits	40,931	39,550	79,857	78,923
Occupancy expense of premises	4,764	4,734	9,611	9,768
Equipment expense	3,760	3,559	7,877	7,095
Marketing	1,589	1,280	3,132	2,473
Outside data services	2,853	2,564	5,367	4,983
FDIC insurance	2,375	1,078	4,513	2,062
Amortization of intangible assets	1,269	1,466	2,575	2,974
Merger, acquisition and disposal expense	0	1,067	0	1,067
Professional fees and services	4,161	2,372	7,845	4,389
Other expenses	7,434	7,321	14,664	13,404
Total non-interest expense	69,136	64,991	135,441	127,138
Income before income tax expense	33,456	73,158	101,940	131,422
Income tax expense	8,711	18,358	25,942	32,687
Net income	$ 24,745	$ 54,800	$ 75,998	$ 98,735
Per share information:
Basic net income per common share (in dollars per share)	$ 0.55	$ 1.21	$ 1.69	$ 2.18
Diluted net income per common share (in dollars per share)	0.55	1.21	1.69	2.17
Dividends declared per share (in dollars per share)	$ 0.34	$ 0.34	$ 0.68	$ 0.68
Service charges on deposit accounts
Non-interest income:
Fees and commissions, mortgage banking and servicing	$ 2,606	$ 2,467	$ 4,994	$ 4,793
Mortgage banking activities
Non-interest income:
Fees and commissions, mortgage banking and servicing	1,817	1,483	3,062	3,781
Wealth management income
Non-interest income:
Fees and commissions, mortgage banking and servicing	9,031	9,098	18,023	18,435
Bank card fees
Non-interest income:
Fees and commissions, mortgage banking and servicing	$ 447	$ 1,810	$ 865	$ 3,478

XML

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - UNAUDITED - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Statement of Comprehensive Income [Abstract]
Net income	$ 24,745	$ 54,800	$ 75,998	$ 98,735
Investments available-for-sale:
Net change in unrealized gains/ (losses) on investments available-for-sale	(13,609)	(38,857)	7,175	(104,780)
Related income tax (expense)/ benefit	3,466	9,961	(1,828)	26,858
Net investment gains reclassified into earnings	0	(38)	0	(46)
Related income tax expense	0	10	0	12
Net effect on other comprehensive income/ (loss)	(10,143)	(28,924)	5,347	(77,956)
Investments held-to-maturity:
Net change in unrealized gains/ (losses)	458	802	863	(15,127)
Related income tax (expense)/ benefit	(117)	(205)	(220)	3,878
Net effect on other comprehensive income/ (loss)	341	597	643	(11,249)
Defined benefit pension plan:
Amortization of net loss	226	195	451	391
Related income tax benefit	(58)	(50)	(115)	(100)
Net effect on other comprehensive income/ (loss)	168	145	336	291
Total other comprehensive income/ (loss)	(9,634)	(28,182)	6,326	(88,914)
Comprehensive income	$ 15,111	$ 26,618	$ 82,324	$ 9,821

XML

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - UNAUDITED - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Retained Earnings	Accumulated Other Comprehensive Income/ (Loss)
Balance at beginning of period at Dec. 31, 2021	$ 1,519,679	$ 45,119	$ 751,072	$ 732,027	$ (8,539)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	98,735			98,735
Other comprehensive loss, net of tax	(88,914)				(88,914)
Comprehensive income	9,821
Common stock dividends	(31,055)			(31,055)
Stock compensation expense	4,650		4,650
Stock option plan	240	10	230
Employee stock purchase plan	930	22	908
Restricted stock vesting, net of tax withholding	(2,109)	104	(2,213)
Repurchase of common stock	(24,987)	(625)	(24,362)
Balance at end of period at Jun. 30, 2022	1,477,169	44,630	730,285	799,707	(97,453)
Balance at beginning of period at Mar. 31, 2022	1,488,910	45,163	752,671	760,347	(69,271)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	54,800			54,800
Other comprehensive loss, net of tax	(28,182)				(28,182)
Comprehensive income	26,618
Common stock dividends	(15,440)			(15,440)
Stock compensation expense	3,178		3,178
Stock option plan	45	1	44
Employee stock purchase plan	494	12	482
Restricted stock vesting, net of tax withholding	(1,649)	79	(1,728)
Repurchase of common stock	(24,987)	(625)	(24,362)
Balance at end of period at Jun. 30, 2022	1,477,169	44,630	730,285	799,707	(97,453)
Balance at beginning of period at Dec. 31, 2022	1,483,768	44,657	734,273	836,789	(131,951)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	75,998			75,998
Other comprehensive loss, net of tax	6,326				6,326
Comprehensive income	82,324
Common stock dividends	(30,732)			(30,732)
Stock compensation expense	3,972		3,972
Stock option plan	517	41	476
Employee stock purchase plan	844	31	813
Restricted stock vesting, net of tax withholding	(1,661)	133	(1,794)
Balance at end of period at Jun. 30, 2023	1,539,032	44,862	737,740	882,055	(125,625)
Balance at beginning of period at Mar. 31, 2023	1,536,865	44,712	735,509	872,635	(115,991)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	24,745			24,745
Other comprehensive loss, net of tax	(9,634)				(9,634)
Comprehensive income	15,111
Common stock dividends	(15,325)			(15,325)
Stock compensation expense	2,731		2,731
Stock option plan	366	34	332
Employee stock purchase plan	433	19	414
Restricted stock vesting, net of tax withholding	(1,149)	97	(1,246)
Balance at end of period at Jun. 30, 2023	$ 1,539,032	$ 44,862	$ 737,740	$ 882,055	$ (125,625)

XML

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - UNAUDITED (Parenthetical) - $ / shares	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Statement of Stockholders' Equity [Abstract]
Common stock dividends (in dollars per share)	$ 0.34	$ 0.34	$ 0.68	$ 0.68
Stock option plan (in shares)	33,391	1,464	40,921	10,361
Employee stock purchase plan (in shares)	19,718	12,624	31,539	22,205
Restricted stock (in shares)	96,763	78,411	132,855	103,911
Repurchase of common stock (in shares)		625,710		625,710

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Operating activities:
Net income	$ 75,998	$ 98,735
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	10,948	6,007
Provision/ (credit) for credit losses	(16,481)	4,681
Share based compensation expense	3,972	4,650
Gain on disposal of assets	0	(16,699)
Deferred income tax expense	7,806	972
Originations of loans held for sale	(194,320)	(200,986)
Proceeds from sales of loans held for sale	186,995	221,492
Gains on sales of loans held for sale	(2,445)	(4,707)
Losses on sale of other real estate owned	0	24
Investment securities gains	0	(46)
Tax (benefit)/ deficiency associated with share based compensation	305	(592)
Net (increase)/ decrease in accrued interest receivable	(1,216)	890
Net increase in other assets	(10,424)	(989)
Net decrease in accrued expenses and other liabilities	(6,656)	(9,425)
Other, net	(191)	(2,487)
Net cash provided by operating activities	54,291	101,520
Investing activities:
Purchases of other investments	(2,833)	(11,098)
Purchases of investments available-for-sale	0	(356,033)
Proceeds from sales of investment available-for-sale	0	1,261
Proceeds from maturities, calls and principal payments of investments available-for-sale	76,412	138,473
Proceeds from maturities, calls and principal payments of investments held-to-maturity	12,337	15,961
Net (increase)/ decrease in loans	27,075	(814,098)
Proceeds from the sales of other real estate owned	35	271
Proceeds from sale of business activity, net	0	23,936
Expenditures for premises and equipment	(7,334)	(7,612)
Net cash provided by/ (used in) investing activities	105,692	(1,008,939)
Financing activities:
Net increase in deposits	6,243	345,832
Net increase in retail repurchase agreements, federal funds purchased and Federal Reserve Bank borrowings	52,543	44,658
Proceeds from FHLB advances	2,030,000	346,625
Repayment of FHLB advances	(1,980,000)	(171,625)
Proceeds from issuance of subordinated debt	0	200,000
Proceeds from issuance of common stock	1,521	1,339
Stock tendered for payment of withholding taxes	(1,821)	(2,278)
Repurchase of common stock	0	(24,987)
Cash dividends paid	(30,574)	(30,886)
Net cash provided by financing activities	77,912	708,678
Net increase/ (decrease) in cash and cash equivalents	237,895	(198,741)
Cash and cash equivalents at beginning of period	192,232	420,020
Cash and cash equivalents at end of period	430,127	221,279
Supplemental disclosures:
Interest payments	120,491	13,859
Income tax payments, net of refunds of $0 and $966 in 2023 and 2022, respectively	$ 22,750	$ 25,059

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED (Parenthetical) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Statement of Cash Flows [Abstract]
Income tax refunds	$ 0	$ 966

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SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jun. 30, 2023

Accounting Policies [Abstract]

SIGNIFICANT ACCOUNTING POLICIES

SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations

Sandy Spring Bancorp, Inc. ("Bancorp" or, together with its subsidiaries, the "Company"), a Maryland corporation, is the bank holding company for Sandy Spring Bank (the “Bank”). Independent and community-oriented, the Bank offers a broad range of commercial banking, retail banking, mortgage services and trust services throughout central Maryland, Northern Virginia, and the greater Washington, D.C. market. The Bank also offers a comprehensive menu of wealth management services through its subsidiaries, West Financial Services, Inc. (“West Financial”) and SSB Wealth Management, Inc. (d/b/a Rembert Pendleton Jackson, "RPJ”).

Basis of Presentation

The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America (“GAAP”), prevailing practices within the financial services industry for interim financial information and Rule 10-01 of Regulation S-X. Accordingly, the interim financial statements do not include all of the information and notes required for complete financial statements. The following summary of significant accounting policies of the Company is presented to assist the reader in understanding the financial and other data presented in this report. Operating results for the six months ended June 30, 2023 are not necessarily indicative of the results that may be expected for any future periods or for the year ending December 31, 2023. In the opinion of management, all adjustments necessary for a fair presentation of the results of the interim periods have been included. The Company has evaluated subsequent events through the date of the issuance of its financial statements.

These statements should be read in conjunction with the financial statements and accompanying notes included in the Company’s 2022 Annual Report on Form 10-K as filed with the Securities and Exchange Commission (“SEC”) on February 21, 2023. There have been no significant changes to any of the Company’s accounting policies as disclosed in the 2022 Annual Report on Form 10-K.

Principles of Consolidation

The unaudited Condensed Consolidated Financial Statements include the accounts of the Company and its wholly-owned subsidiary, Sandy Spring Bank, and its subsidiaries. Consolidation has resulted in the elimination of all intercompany accounts and transactions.

Use of Estimates

The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements, in addition to affecting the reported amounts of revenues earned and expenses incurred during the reporting period. Actual results could differ from those estimates. Estimates that could change significantly relate to the provision for credit losses and the related allowance, potential impairment of goodwill or other intangible assets, valuation of investment securities and the determination of whether available-for-sale debt securities with fair values less than amortized costs are impaired and require an allowance for credit losses, valuation of other real estate owned, valuation of share based compensation, the assessment that a liability should be recognized with respect to any matters under litigation, the calculation of current and deferred income taxes, and the actuarial projections related to pension expense and the related liability.

Cash Flows

For purposes of reporting cash flows, cash and cash equivalents include cash and due from banks, federal funds sold and interest-bearing deposits with banks (items with stated original maturity of three months or less).

Revenue from Contracts with Customers

The Company’s revenue includes net interest income on financial instruments and non-interest income. Specific categories of revenue are presented in the Condensed Consolidated Statements of Income. Most of the Company’s revenue is not within the scope of Accounting Standard Codification (“ASC”) 606 – Revenue from Contracts with Customers. For revenue within the scope of ASC 606, the Company provides services to customers and has related performance obligations. The revenue from such services is recognized upon satisfaction of all contractual performance obligations. The following discusses key revenue streams within the scope of this revenue recognition guidance.

West Financial and RPJ provide comprehensive investment management and financial planning services. Wealth management income is comprised of income for providing trust, estate and investment management services. Trust services include acting as

a trustee for corporate or personal trusts. Investment management services include investment management, record-keeping and reporting of security portfolios. Fees for these services are recognized based on a contractually-agreed fixed percentage applied to net assets under management at the end of each reporting period. The Company does not charge/recognize any performance-based fees.

Prior to the sale of its assets in June 2022, Sandy Spring Insurance Corporation performed the function of an insurance intermediary by introducing the policyholder and insurer and was compensated by a commission fee for placement of an insurance policy. Sandy Spring Insurance did not provide any captive management services or any claim handling services. Commission fees were set as a percentage of the premium for the insurance policy for which Sandy Spring Insurance was a producer. Sandy Spring Insurance recognized revenue when the insurance policy was contractually agreed to by the insurer and policyholder (at transaction date).

Service charges on deposit accounts are earned on depository accounts for consumer and commercial account holders and include fees for account and overdraft services. Account services include fees for event-driven services and periodic account maintenance activities. An obligation for event-driven services is satisfied at the time of the event when service is delivered and revenue recognized as earned. Obligation for maintenance activities is satisfied over the course of each month and revenue is recognized at month end. The overdraft services obligation is satisfied at the time of the overdraft and revenue is recognized as earned.

Loan Financing Receivables

The Company’s financing receivables consist primarily of loans that are stated at their principal balance outstanding, net of any unearned income, acquisition fair value marks and deferred loan origination fees and costs. Interest income on loans is accrued at the contractual rate based on the principal balance outstanding. Loan origination fees, net of certain direct origination costs, are deferred and recognized as an adjustment of the related loan yield using the interest method.

Loans are considered past due or delinquent when the principal or interest due in accordance with the contractual terms of the loan agreement or any portion thereof remains unpaid after the due date of the scheduled payment. Immaterial shortfalls in payment amounts do not necessarily result in a loan being considered delinquent or past due. If any payments are past due and subsequent payments are resumed without payment of the delinquent amount, the loan shall continue to be considered past due. Whenever any loan is reported delinquent on a principal or interest payment or portion thereof, the amount reported as delinquent is the outstanding principal balance of the loan.

Loans, except for consumer installment loans, are placed into non-accrual status when any portion of the loan principal or interest becomes 90 days past due. Management may determine that certain circumstances warrant earlier discontinuance of interest accruals on specific loans if an evaluation of other relevant factors (such as bankruptcy, interruption of cash flows, etc.) indicates collection of amounts contractually due is unlikely. These loans are considered, collectively, to be non-performing loans. Consumer installment loans that are not secured by real estate are not placed on non-accrual, but are charged down to their net realizable value when they are four months past due. Loans designated as non-accrual have all previously accrued but unpaid interest reversed. Interest income is not recognized on non-accrual loans. All payments received on non-accrual loans are applied using a cost-recovery method to reduce the outstanding principal balance until the loan returns to accrual status. Loans may be returned to accrual status when all principal and interest amounts contractually due are brought current and future payments are reasonably assured.

On January 1, 2023, the Company adopted provisions of ASU 2022-02, "Financial Instruments - Credit Losses (Topic 326)", which eliminated accounting guidance for TDRs by creditors. Prior to the effective adoption date, the Company considered loans to be TDRs if their terms were restructured (e.g., interest rates, loan maturity date, payment and amortization period, etc.) in circumstances that provided a payment concession to a borrower experiencing financial difficulty. Loans could be removed from a TDR category if the borrower no longer experienced financial difficulty, a re-underwriting event took place, and the revised loan terms of the subsequent restructuring agreement were considered to be consistent with terms that could be obtained in the market for loans with comparable credit risk. Subsequent to the effective adoption date, the Company continues to offer modifications to certain borrowers experiencing financial difficulty, mainly in the form of interest rate concessions or term extensions, without classifying and accounting for them as TDRs.

Allowance for Credit Losses

The allowance for credit losses (“allowance” or “ACL”) represents an amount which, in management's judgment, reflects the lifetime expected losses that may be sustained on outstanding loans at the balance sheet date based on the evaluation of the size and current risk characteristics of the loan portfolio, past events, current conditions, reasonable and supportable forecasts of future economic conditions and prepayment experience. The allowance is measured and recorded upon the initial recognition of

a financial asset. The allowance is reduced by charge-offs, net of recoveries of previous losses, and is increased or decreased by a provision or credit for credit losses, which is recorded as a current period expense.

Determination of the appropriateness of the allowance is inherently complex and requires the use of significant and highly subjective estimates. The reasonableness of the allowance is reviewed periodically by the Risk Committee of the Board of Directors and formally approved quarterly by that same committee of the Board.

The Company’s methodology for estimating the allowance includes: (1) a collective quantified reserve that reflects the Company’s historical default and loss experience adjusted for expected economic conditions throughout a reasonable and supportable period and the Company’s prepayment and curtailment rates; (2) collective qualitative factors that consider the expected impact of certain factors not fully captured in the collective quantified reserve, including concentrations of the loan portfolio, expected changes to the economic forecasts, large relationships, early delinquencies, and factors related to credit administration, including, among others, loan-to-value ratios, borrowers’ risk rating and credit score migrations; and (3) individual allowances on collateral-dependent loans where borrowers are experiencing financial difficulty or when the Company determines that the foreclosure is probable. The Company excludes accrued interest from the measurement of the allowance as the Company has a non-accrual policy to reverse any accrued, uncollected interest income as loans are moved to non-accrual status.

Loans are pooled into segments based on the similar risk characteristics of the underlying borrowers, in addition to consideration of collateral type, industry and business purpose of the loans. Portfolio segments used to estimate the allowance are the same as portfolio segments used for general credit risk management purposes. Refer to Note 4 for more details on the Company’s portfolio segments.

The Company applies two calculation methodologies to estimate the collective quantified component of the allowance: discounted cash flows method and weighted average remaining life method. Allowance estimates on commercial acquisition, development and construction (“AD&C”) and residential construction segments are based on the weighted average remaining life method. Allowance estimates on all other portfolio segments are based on the discounted cash flows method. Segments utilizing the discounted cash flows method are further sub-segmented into risk level pools, determined either by risk rating for commercial loans or Beacon Scores ranges for residential and consumer loans. To better manage risk and reasonably determine the sufficiency of reserves, this segregation allows the Company to monitor the allowance component applicable to higher risk loans separate from the remainder of the portfolio. Collective calculation methodologies utilize the Company’s historical default and loss experience adjusted for future economic forecasts. The reasonable and supportable forecast period represents a two-year economic outlook for the applicable economic variables. Following the end of the reasonable and supportable forecast period expected losses revert back to the historical mean over the next two years on a straight-line basis. Economic variables that have the most significant impact on the allowance include: unemployment rate, house price index and business bankruptcies. Contractual loan level cash flows within the discounted cash flows methodology are adjusted for the Company’s historical prepayment and curtailment rate experience.

The individual reserve assessment is applied to collateral dependent loans where borrowers are experiencing financial difficulty or when the Company determines that a foreclosure is probable. The determination of the fair value of the collateral depends on whether a repayment of the loan is expected to be from the sale or the operation of the collateral. When a repayment is expected from the operation of the collateral, the Company uses the present value of expected cash flows from the operation of the collateral as the fair value. When the repayment of the loan is expected from the sale of the collateral the fair value of the collateral is based on an observable market price or the collateral’s appraised value, less estimated costs to sell. Third-party appraisals used in the individual reserve assessment are conducted at least annually with underlying assumptions that are reviewed by management. Third-party appraisals may be obtained on a more frequent basis if deemed necessary. Internal evaluations of collateral value are conducted quarterly to ensure any further deterioration of the collateral value is recognized on a timely basis. During the individual reserve assessment, management also considers the potential future changes in the value of the collateral over the remainder of the loan’s remaining life. The Company may receive updated appraisals which contradict the preliminary determination of fair value used to establish an individual allowance on a loan. In these instances the individual allowance is adjusted to reflect the Company’s evaluation of the updated appraised fair value. In the event a loss was previously confirmed and the loan was charged down to the estimated fair value based on a previous appraisal, the balance of partially charged-off loans are not subsequently increased, but could be further decreased depending on the direction of the change in fair value. Payments on fully or partially charged-off loans are accounted for under the cost-recovery method. Under this method, all payments received are applied on a cash basis to reduce the entire outstanding principal balance, then to recognize a recovery of all previously charged-off amounts before any interest income may be recognized. Based on the individual reserve assessment, if the Company determines that the fair value of the collateral is less than the amortized cost basis of the loan, an individual allowance will be established measured as the difference between the fair value of the collateral

(less costs to sell) and the amortized cost basis of the loan. Once a loss has been confirmed, the loan is charged-down to its estimated fair value.

Large groups of smaller non-accrual homogeneous loans are not individually evaluated for allowance and include residential permanent and construction mortgages and consumer installment loans. These portfolios are reserved for on a collective basis using historical loss rates of similar loans over the weighted average life of each pool.

Unfunded lending commitments are reviewed to determine if they are considered unconditionally cancellable. The Company establishes reserves for unfunded commitments that do not meet that criteria as a liability in the Condensed Consolidated Statements of Condition. Changes to the liability are recorded through the provision for credit losses in the Condensed Consolidated Statements of Income. The establishment of the reserves for unfunded commitments considers both the likelihood that the funding will occur and an estimate of the expected credit losses over the life of the respective commitments.

Management believes it uses relevant information available to make determinations about the allowance and reserve for unfunded commitments and that it has established the existing reserves in accordance with GAAP. However, the determination of the allowance requires significant judgment, and estimates of expected lifetime losses in the loan portfolio can vary significantly from the amounts actually observed. While management uses available information to recognize expected losses, future additions to the allowance may be necessary based on changes in the loans comprising the portfolio, changes in the current and forecasted economic conditions, changes to the interest rate environment which may directly impact prepayment and curtailment rate assumptions, and changes in the financial condition of borrowers.

Held-to-maturity debt securities

Debt securities that are purchased with the positive intent and ability to be held until their maturity are classified as held-to-maturity (“HTM”). HTM debt securities are recorded at cost adjusted for amortization of premiums and accretion of discounts. Transfers of debt securities from available-for-sale ("AFS") category to HTM category are made at fair value as of the transfer date. The unrealized gain or loss at the date of transfer continues to be reported in accumulated other comprehensive income and in the carrying amount of the HTM securities. Both amounts are amortized over the remaining life of the security as a yield adjustment in interest income and effectively offset each other.

Leases

The Company determines if an arrangement is a lease at inception. All of the Company’s leases are currently classified as operating leases and are included in other assets and other liabilities on the Company’s Condensed Consolidated Statements of Condition. Periodic operating lease costs are recorded in occupancy expenses of premises on the Company's Condensed Consolidated Statements of Income.

Right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease arrangements. Operating lease ROU assets and liabilities are recognized at the lease commencement date based on the present value of the expected future lease payments over the remaining lease term. In determining the present value of future lease payments, the Company uses its incremental borrowing rate based on the information available at the lease commencement date. The operating ROU assets are adjusted for any lease payments made at or before the lease commencement date, initial direct costs, any lease incentives received and, for acquired leases, any favorable or unfavorable fair value adjustments. The present value of the lease liability may include the impact of options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options provided in the lease terms. Lease expense is recognized on a straight-line basis over the expected lease term. Lease agreements that include lease and non-lease components, such as common area maintenance charges, are accounted for separately.

Adopted Accounting Pronouncements

In March 2022, the FASB issued ASU 2022-02, "Financial Instruments - Credit Losses (Topic 326)", which eliminated the accounting guidance on troubled debt restructurings (“TDR”) and amended the guidance on “vintage disclosures” to require disclosure of current period gross charge-offs by year of origination. The ASU also added enhanced disclosures for creditors with respect to loan refinancing and restructurings for borrowers experiencing financial difficulty. The objective of the disclosures was to provide information about the type and magnitude of modifications and the degree of their success in mitigating potential credit losses. The Company fully adopted this update effective January 1, 2023 on a prospective basis. The adoption of this pronouncement did not have a material impact on the Consolidated Financial Statements.

Pending Accounting Pronouncements

In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848)”. This ASU provided temporary, optional

guidance to ease the potential burden in accounting for, or recognizing the effects of, the transition away from the London Interbank Offered Rate ("LIBOR") or other reference rate expected to be discontinued on financial reporting. The standard was

elective and provided optional expedients and exceptions for applying GAAP to contracts, hedging relationships, or other transactions that reference LIBOR, or another reference rate expected to be discontinued. The amendments in the update were effective for all entities between March 12, 2020 and December 31, 2022. In January 2021, the FASB issued ASU 2021-01, “Reference Rate Reform (Topic 848): Scope”. This ASU refines the scope of Topic 848 and addresses questions about whether Topic 848 can be applied to derivative instruments that do not reference a rate that is expected to be discontinued, but that use an interest rate for margining, discounting or contract price alignment that is expected to be modified as a result of reference rate reform. ASU 2021-01 is effective upon issuance through December 31, 2024, and can be adopted at any time during this period. The Company has not offered LIBOR for any new contracts since 2021. The Company has identified all known LIBOR exposures, created a plan to address the exposures, and continues to communicate with all stakeholders in order to facilitate the transition to an alternative reference rate. The Company adopted ASU 2020-04 on January 1, 2022. The adoption did not have a material impact on the Company’s Consolidated Financial Statements. The Company continues to evaluate the adoption of ASU 2021-01 and does not expect it to have a material impact on the Company's Consolidated Financial Statements.

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INVESTMENTS

6 Months Ended

Jun. 30, 2023

Investments, Debt and Equity Securities [Abstract]

INVESTMENTS

INVESTMENTS

Investments available-for-sale and held-to-maturity

The amortized cost and estimated fair values of investments available-for-sale and held-to-maturity at the dates indicated are presented in the following table:

	June 30, 2023								December 31, 2022
(In thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Available-for-sale debt securities:
U.S. treasuries and government agencies	$	101,299	$	—	$	(6,954)	$	94,345	$	100,926	$	—	$	(7,304)	$	93,622
State and municipal	318,815		1		(50,565)		268,251		322,519		4		(56,526)		265,997
Mortgage-backed and asset-backed	868,704		40		(87,652)		781,092		943,398		73		(88,552)		854,919
Total available-for-sale debt securities	$	1,288,818	$	41	$	(145,171)	$	1,143,688	$	1,366,843	$	77	$	(152,382)	$	1,214,538
Held-to-maturity debt securities:
Mortgage-backed and asset-backed	247,814		—		(39,152)		208,662		259,452		—		(39,329)		220,123
Total held-to-maturity debt securities	$	247,814	$	—	$	(39,152)	$	208,662	$	259,452	$	—	$	(39,329)	$	220,123
Total debt securities	$	1,536,632	$	41	$	(184,323)	$	1,352,350	$	1,626,295	$	77	$	(191,711)	$	1,434,661

Any unrealized losses in the U.S. treasuries and government agencies, state and municipal, mortgage-backed and asset-backed available-for-sale debt securities at June 30, 2023 are due to changes in interest rates and not credit-related events. As such, no allowance for credit losses is required at June 30, 2023. Unrealized losses on available-for-sale debt securities are expected to recover over time as these securities approach maturity. The Company does not intend to sell, nor is it more likely than not it will be required to sell, these securities and has sufficient liquidity to hold these securities for an adequate period of time, which may be maturity, to allow for any anticipated recovery in fair value.

All held-to-maturity investments are either issued by a direct governmental entity or a government-sponsored entity and have no historical evidence supporting expected credit losses. Therefore, the Company has estimated these losses at zero and will monitor this assumption in the future for any economic or governmental policies that could affect this assumption.

The available-for-sale and held-to-maturity mortgage-backed securities portfolio at June 30, 2023 is composed entirely of either the most senior tranches of GNMA, FNMA or FHLMC collateralized mortgage obligations ($466.7 million), GNMA, FNMA or FHLMC mortgage-backed securities ($611.3 million) or SBA asset-backed securities ($38.5 million).

Gross unrealized losses and fair value by length of time that the individual available-for-sale debt securities have been in an unrealized loss position at the dates indicated are presented in the following tables:

	June 30, 2023
	Number of Securities	Less Than 12 Months				12 Months or More				Total
(Dollars in thousands)		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
U.S. treasuries and government agencies	10	$	—	$	—	$	94,345	$	6,954	$	94,345	$	6,954
State and municipal	127	17,222		488		249,495		50,077		266,717		50,565
Mortgage-backed and asset-backed	327	158,418		6,042		613,216		81,610		771,634		87,652
Total	464	$	175,640	$	6,530	$	957,056	$	138,641	$	1,132,696	$	145,171

	December 31, 2022
	Number of Securities	Less Than 12 Months				12 Months or More				Total
(Dollars in thousands)		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
U.S. treasuries and government agencies	10	$	53,139	$	3,653	$	40,483	$	3,651	$	93,622	$	7,304
State and municipal	130	200,439		30,803		62,482		25,723		262,921		56,526
Mortgage-backed and asset-backed	324	526,387		44,952		297,216		43,600		823,603		88,552
Total	464	$	779,965	$	79,408	$	400,181	$	72,974	$	1,180,146	$	152,382

The Company has allocated mortgage-backed securities into the four maturity groupings reflected in the following tables using the expected average life of the individual securities based on statistics provided by independent third-party industry sources. Expected maturities will differ from contractual maturities as borrowers may have the right to prepay obligations with or without prepayment penalties.

The estimated fair values and amortized costs of available-for-sale and held-to-maturity debt securities by contractual maturity are provided in the following tables.

	June 30, 2023				December 31, 2022
(In thousands)	Fair Value		Amortized Cost		Fair Value		Amortized Cost
Available-for-sale debt securities
U.S. treasuries and government agencies:
One year or less	$	14,580	$	14,984	$	—	$	—
One to five years	79,765		86,315		93,622		100,926
Five to ten years	—		—		—		—
After ten years	—		—		—		—
State and municipal:
One year or less	6,799		6,842		8,694		8,783
One to five years	53,557		55,926		51,576		53,948
Five to ten years	36,343		43,156		28,806		34,042
After ten years	171,552		212,891		176,921		225,746
Mortgage-backed and asset-backed:
One year or less	4,692		4,744		7,622		7,704
One to five years	47,004		48,742		45,366		46,802
Five to ten years	274,805		305,295		303,697		335,285
After ten years	454,591		509,923		498,234		553,607
Total available-for-sale debt securities	$	1,143,688	$	1,288,818	$	1,214,538	$	1,366,843

	June 30, 2023				December 31, 2022
(In thousands)	Fair Value		Amortized Cost		Fair Value		Amortized Cost
Held-to-maturity debt securities
Mortgage-backed and asset-backed:
One year or less	$	—	$	—	$	—	$	—
One to five years	—		—		—		—
Five to ten years	32,997		36,828		35,304		39,213
After ten years	175,665		210,986		184,819		220,239
Total held-to-maturity debt securities	$	208,662	$	247,814	$	220,123	$	259,452

At June 30, 2023 and December 31, 2022, available-for-sale and held-to-maturity debt securities with a book value of $776.8 million and $533.9 million, respectively, were pledged and designated as collateral for certain government deposits, public and trust funds, securities sold under repurchase agreements and other purposes as required or permitted by law. The outstanding balance of no single issuer, except for U.S. Agencies securities, exceeded ten percent of stockholders' equity at June 30, 2023 and December 31, 2022.

Other investments

Other investments are presented in the following table:

(In thousands)	June 30, 2023		December 31, 2022
Federal Reserve Bank stock, at cost	$	38,961	$	38,873
Federal Home Loan Bank of Atlanta stock, at cost	32,414		29,668
Other	677		677
Total other investments, at cost	$	72,052	$	69,218

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LOANS

6 Months Ended

Jun. 30, 2023

Receivables [Abstract]

LOANS

LOANS

Outstanding loan balances at June 30, 2023 and December 31, 2022 are net of unearned income, including net deferred loan fees of $9.3 million and $10.5 million, respectively, at the end of each period.

The loan portfolio segment balances at the dates indicated are presented in the following table:

(In thousands)	June 30, 2023		December 31, 2022
Commercial real estate:
Commercial investor real estate	$	5,131,210	$	5,130,094
Commercial owner-occupied real estate	1,770,135		1,775,037
Commercial AD&C	1,045,742		1,090,028
Commercial business	1,423,614		1,455,885
Total commercial loans	9,370,701		9,451,044
Residential real estate:
Residential mortgage	1,385,743		1,287,933
Residential construction	190,690		224,772
Consumer	422,505		432,957
Total residential and consumer loans	1,998,938		1,945,662
Total loans	$	11,369,639	$	11,396,706

Portfolio Segments

The Company currently manages its credit products and the respective exposure to credit losses (credit risk) by the following specific portfolio segments (classes) which are levels at which the Company develops and documents its systematic methodology to determine the allowance for credit losses attributable to each respective portfolio segment. These segments are:

•Commercial investor real estate loans - Commercial investor real estate loans consist of loans secured by nonowner-occupied properties where an established banking relationship exists and involves investment properties for warehouse, retail, and office space with a history of occupancy and cash flow. This commercial investor real estate category contains mortgage loans to the developers and owners of commercial real estate where the borrower intends to operate or sell the property at a profit and use the income stream or proceeds from the sale(s) to repay the loan.

•Commercial owner-occupied real estate loans - Commercial owner-occupied real estate loans consist of commercial mortgage loans secured by owner occupied properties where an established banking relationship exists and involves a variety of property types to conduct the borrower’s operations. The decision to extend a loan is based upon the borrower’s financial health and the ability of the borrower and the business to repay. The primary source of repayment for this type of loan is the cash flow from the operations of the business.

•Commercial acquisition, development and construction loans - Commercial acquisition, development and construction loans are intended to finance the construction of commercial properties and include loans for the acquisition and development of land. Construction loans represent a higher degree of risk than permanent real estate loans and may be affected by a variety of additional factors such as the borrower’s ability to control costs and adhere to time schedules and the risk that constructed units may not be absorbed by the market within the anticipated time frame or at the anticipated price. The loan commitment on these loans often includes an interest reserve that allows the lender to periodically advance loan funds to pay interest charges on the outstanding balance of the loan.

•Commercial business loans - Commercial loans are made to provide funds for equipment and general corporate needs. Repayment of a loan primarily comes from the funds obtained from the operation of the borrower’s business.

Commercial loans also include lines of credit that are utilized to finance a borrower’s short-term credit needs and/or to finance a percentage of eligible receivables and inventory. Loans issued under the PPP are also included in this category, a substantial portion of which are expected to be forgiven by the Small Business Administration pursuant to the CARES Act.

•Residential mortgage loans - The residential mortgage loans category contains permanent mortgage loans principally to consumers secured by residential real estate. Residential real estate loans are evaluated for the adequacy of repayment sources at the time of approval, based upon measures including credit scores, debt-to-income ratios, and collateral values. Loans may be either conforming or non-conforming.

•Residential construction loans - The Company makes residential construction loans generally to provide interim financing on residential property during the construction period. Borrowers are typically individuals who will ultimately occupy the single-family dwelling. Loan funds are disbursed periodically as pre-specified stages of completion are attained based upon site inspections.

•Consumer loans - This category of loans includes primarily home equity loans and lines, installment loans, personal lines of credit, and other loans. The home equity category consists mainly of revolving lines of credit to consumers which are secured by residential real estate. These loans are typically secured with second mortgages on the homes. Other consumer loans include installment loans used by customers to purchase automobiles, boats and recreational vehicles.

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CREDIT QUALITY ASSESSMENT

6 Months Ended

Jun. 30, 2023

Credit Loss [Abstract]

CREDIT QUALITY ASSESSMENT

CREDIT QUALITY ASSESSMENT

Allowance for Credit Losses

Summary information on the allowance for credit losses on loans for the period indicated is provided in the following table:

	Six Months Ended June 30,
(In thousands)	2023		2022
Balance at beginning of period	$	136,242	$	109,145
Provision/ (credit) for credit losses - loans (1)	(14,491)		4,681
Loan charge-offs	(2,265)		(762)
Loan recoveries	801		606
Net charge-offs	(1,464)		(156)
Balance at period end	$	120,287	$	113,670

 (1) Excludes the total credit to the provision on unfunded loan commitments for six months ended June 30, 2023 of $2.0 million.

The following table provides summary information regarding collateral dependent loans individually evaluated for credit loss at the dates indicated:

(In thousands)	June 30, 2023		December 31, 2022
Collateral dependent loans individually evaluated for credit loss with an allowance	$	48,878	$	9,743
Collateral dependent loans individually evaluated for credit loss without an allowance	14,652		16,454
Total individually evaluated collateral dependent loans	$	63,530	$	26,197
Allowance for credit losses related to loans evaluated individually	$	16,224	$	6,902
Allowance for credit losses related to loans evaluated collectively	104,063		129,340
Total allowance for credit losses - loans	$	120,287	$	136,242

The following tables provide information on the activity in the allowance for credit losses by the respective loan portfolio segment for the period indicated:

	For the Six Months Ended June 30, 2023
	Commercial Real Estate												Residential Real Estate
(Dollars in thousands)	Commercial Investor R/E			Commercial Owner- Occupied R/E			Commercial AD&C			Commercial Business			Residential Mortgage			Residential Construction			Consumer			Total
Balance at beginning of period	$	64,737		$	11,646		$	18,646		$	28,027		$	9,424		$	1,337		$	2,425		$	136,242
Provision/ (credit) for credit losses - loans	(3,669)			(2,469)			(8,446)			123			(207)			(487)			664			(14,491)
Charge-offs	—			—			—			(423)			(160)			—			(1,682)			(2,265)
Recoveries	19			53			—			187			104			—			438			801
Net (charge-offs)/ recoveries	19			53			—			(236)			(56)			—			(1,244)			(1,464)
Balance at end of period	$	61,087		$	9,230		$	10,200		$	27,914		$	9,161		$	850		$	1,845		$	120,287
Total loans	$	5,131,210		$	1,770,135		$	1,045,742		$	1,423,614		$	1,385,743		$	190,690		$	422,505		$	11,369,639
Allowance for credit losses on loans to total loans ratio	1.19		%	0.52		%	0.98		%	1.96		%	0.66		%	0.45		%	0.44		%	1.06		%
Average loans	$	5,141,447		$	1,771,369		$	1,069,927		$	1,443,030		$	1,330,912		$	217,419		$	423,711		$	11,397,815
Annualized net charge-offs/ (recoveries) to average loans	—		%	(0.01)		%	—		%	0.03		%	0.01		%	—		%	0.59		%	0.03		%
Balance of loans individually evaluated for credit loss	$	48,721		$	4,846		$	570		$	9,393		$	—		$	—		$	—		$	63,530
Allowance related to loans evaluated individually	$	7,908		$	1,226		$	102		$	6,988		$	—		$	—		$	—		$	16,224
Individual allowance to loans evaluated individually ratio	16.23		%	25.30		%	17.89		%	74.40		%	—		%	—		%	—		%	25.54		%
Contractual balance of individually evaluated loans	$	48,886		$	5,675		$	581		$	10,545		$	—		$	—		$	—		$	65,687
Balance of loans collectively evaluated for credit loss	$	5,082,489		$	1,765,289		$	1,045,172		$	1,414,221		$	1,385,743		$	190,690		$	422,505		$	11,306,109
Allowance related to loans evaluated collectively	$	53,179		$	8,004		$	10,098		$	20,926		$	9,161		$	850		$	1,845		$	104,063
Collective allowance to loans evaluated collectively ratio	1.05		%	0.45		%	0.97		%	1.48		%	0.66		%	0.45		%	0.44		%	0.92		%

	For the Year Ended December 31, 2022
	Commercial Real Estate												Residential Real Estate
(Dollars in thousands)	Commercial Investor R/E			Commercial Owner- Occupied R/E			Commercial AD&C			Commercial Business			Residential Mortgage			Residential Construction			Consumer			Total
Balance at beginning of period	$	45,289		$	11,687		$	20,322		$	23,170		$	5,384		$	1,048		$	2,245		$	109,145
Provision for credit losses - loans	19,128			(90)			(1,676)			4,774			4,093			281			170			26,680
Charge-offs	—			—			—			(716)			(155)			—			(234)			(1,105)
Recoveries	320			49			—			799			102			8			244			1,522
Net (charge-offs)/ recoveries	320			49			—			83			(53)			8			10			417
Balance at end of period	$	64,737		$	11,646		$	18,646		$	28,027		$	9,424		$	1,337		$	2,425		$	136,242
Total loans	$	5,130,094		$	1,775,037		$	1,090,028		$	1,455,885		$	1,287,933		$	224,772		$	432,957		$	11,396,706
Allowance for credit losses on loans to total loans ratio	1.26		%	0.66		%	1.71		%	1.93		%	0.73		%	0.59		%	0.56		%	1.20		%
Average loans	$	4,681,607		$	1,730,293		$	1,112,936		$	1,351,906		$	1,117,053		$	221,341		$	423,746		$	10,638,882
Net charge-offs/ (recoveries) to average loans	(0.01)		%	—		%	—		%	(0.01)		%	—		%	—		%	—		%	—		%
Balance of loans individually evaluated for credit loss	$	9,943		$	6,155		$	—		$	8,274		$	1,487		$	—		$	338		$	26,197
Allowance related to loans evaluated individually	$	134		$	1,261		$	—		$	5,507		$	—		$	—		$	—		$	6,902
Individual allowance to loans evaluated individually ratio	1.35		%	20.49		%	—		%	66.56		%	—		%	—		%	—		%	26.35		%
Contractual balance of individually evaluated loans	$	10,882		$	6,849		$	—		$	9,893		$	1,487		$	—		$	364		$	29,475
Balance of loans collectively evaluated for credit loss	$	5,120,151		$	1,768,882		$	1,090,028		$	1,447,611		$	1,286,446		$	224,772		$	432,619		$	11,370,509
Allowance related to loans evaluated collectively	$	64,603		$	10,385		$	18,646		$	22,520		$	9,424		$	1,337		$	2,425		$	129,340
Collective allowance to loans evaluated collectively ratio	1.26		%	0.59		%	1.71		%	1.56		%	0.73		%	0.59		%	0.56		%	1.14		%

Credit Quality

The following section provides information on the credit quality of the loan portfolio for the periods indicated below:

	For the Six Months Ended June 30, 2023
	Commercial Real Estate								Residential Real Estate
(In thousands)	Commercial Investor R/E		Commercial Owner- Occupied R/E		Commercial AD&C		Commercial Business		Residential Mortgage		Residential Construction		Consumer		Total
Analysis of non-accrual loan activity:
Balance at beginning of period	$	9,943	$	5,019	$	—	$	7,322	$	7,439	$	—	$	5,059	$	34,782
Loans placed on non-accrual	19,622		—		569		4,362		3,540		—		897		28,990
Non-accrual balances transferred to OREO	—		—		—		—		—		—		—		—
Non-accrual balances charged-off	—		—		—		(424)		(160)		—		(1,591)		(2,175)
Net payments or draws	(9,184)		(173)		—		(1,354)		(309)		—		(846)		(11,866)
Non-accrual loans brought current	—		—		—		(513)		(357)		—		(123)		(993)
Balance at end of period	$	20,381	$	4,846	$	569	$	9,393	$	10,153	$	—	$	3,396	$	48,738

	For the Year Ended December 31, 2022
	Commercial Real Estate								Residential Real Estate
(In thousands)	Commercial Investor R/E		Commercial Owner- Occupied R/E		Commercial AD&C		Commercial Business		Residential Mortgage		Residential Construction		Consumer		Total
Analysis of non-accrual loan activity:
Balance at beginning of period	$	12,489	$	9,306	$	650	$	8,420	$	8,441	$	55	$	6,725	$	46,086
Loans placed on non-accrual	4,761		2,370		—		1,591		2,593		—		815		12,130
Non-accrual balances transferred to OREO	—		—		—		—		—		—		—		—
Non-accrual balances charged-off	—		—		—		(677)		(151)		—		(32)		(860)
Net payments or draws	(7,307)		(4,366)		(650)		(2,012)		(2,615)		(55)		(2,060)		(19,065)
Non-accrual loans brought current	—		(2,291)		—		—		(829)		—		(389)		(3,509)
Balance at end of period	$	9,943	$	5,019	$	—	$	7,322	$	7,439	$	—	$	5,059	$	34,782

	June 30, 2023
	Commercial Real Estate								Residential Real Estate
(In thousands)	Commercial Investor R/E		Commercial Owner- Occupied R/E		Commercial AD&C		Commercial Business		Residential Mortgage		Residential Construction		Consumer		Total
Performing loans:
Current	$	5,108,614	$	1,763,223	$	1,044,320	$	1,413,058	$	1,366,644	$	190,690	$	416,799	$	11,303,348
30-59 days	2,215		2,066		—		747		5,464		—		1,849		12,341
60-89 days	—		—		853		387		2,790		—		461		4,491
Total performing loans	5,110,829		1,765,289		1,045,173		1,414,192		1,374,898		190,690		419,109		11,320,180
Non-performing loans:
Non-accrual loans	20,381		4,846		569		9,393		10,153		—		3,396		48,738
Loans greater than 90 days past due	—		—		—		29		692		—		—		721
Restructured loans (1)	—		—		—		—		—		—		—		—
Total non-performing loans	20,381		4,846		569		9,422		10,845		—		3,396		49,459
Total loans	$	5,131,210	$	1,770,135	$	1,045,742	$	1,423,614	$	1,385,743	$	190,690	$	422,505	$	11,369,639

(1) Effective January 1, 2023, the Company adopted ASU 2022-02, which eliminated the accounting and recognition of troubled debt restructurings ("TDRs").

	December 31, 2022
	Commercial Real Estate								Residential Real Estate
(In thousands)	Commercial Investor R/E		Commercial Owner- Occupied R/E		Commercial AD&C		Commercial Business		Residential Mortgage		Residential Construction		Consumer		Total
Performing loans:
Current	$	5,104,204	$	1,767,875	$	1,090,028	$	1,443,012	$	1,261,878	$	222,144	$	422,989	$	11,312,130
30-59 days	9,735		1,007		—		3,556		11,307		2,628		4,343		32,576
60-89 days	6,212		—		—		41		5,822		—		566		12,641
Total performing loans	5,120,151		1,768,882		1,090,028		1,446,609		1,279,007		224,772		427,898		11,357,347
Non-performing loans:
Non-accrual loans	9,943		5,019		—		7,322		7,439		—		5,059		34,782
Loans greater than 90 days past due	—		—		—		1,002		—		—		—		1,002
Restructured loans	—		1,136		—		952		1,487		—		—		3,575
Total non-performing loans	9,943		6,155		—		9,276		8,926		—		5,059		39,359
Total loans	$	5,130,094	$	1,775,037	$	1,090,028	$	1,455,885	$	1,287,933	$	224,772	$	432,957	$	11,396,706

The following tables present average principal balance of total non-accrual loans and contractual interest due on non-accrual loans for the periods indicated below:

	For the Six Months Ended June 30, 2023
	Commercial Real Estate								Residential Real Estate
(In thousands)	Commercial Investor R/E		Commercial Owner- Occupied R/E		Commercial AD&C		Commercial Business		Residential Mortgage		Residential Construction		Consumer		Total
Average non-accrual loans for the period	$	15,258	$	4,938	$	190	$	8,719	$	8,842	$	—	$	4,452	$	42,399
Contractual interest income due on non- accrual loans during the period	$	559	$	146	$	24	$	350	$	232	$	—	$	243	$	1,554

	For the Year Ended December 31, 2022
	Commercial Real Estate								Residential Real Estate
(In thousands)	Commercial Investor R/E		Commercial Owner- Occupied R/E		Commercial AD&C		Commercial Business		Residential Mortgage		Residential Construction		Consumer		Total
Average non-accrual loans for the period	$	11,892	$	7,314	$	617	$	7,768	$	7,769	$	21	$	5,811	$	41,192
Contractual interest income due on non- accrual loans during the period	$	713	$	106	$	30	$	491	$	319	$	1	$	349	$	2,009

There was no interest income recognized on non-accrual loans during the six months ended June 30, 2023. See Note 1 for additional information on the Company's policies for non-accrual loans. Loans designated as non-accrual have all previously accrued but unpaid interest reversed from interest income. During the six months ended June 30, 2023 new loans placed on non-accrual status totaled $29.0 million and the related amount of reversed uncollected accrued interest was $0.4 million.

The credit quality indicators for commercial loans are developed through review of individual borrowers on an ongoing basis. Each borrower is evaluated at least annually with more frequent evaluation of more severely criticized loans. The indicators represent the rating for loans as of the date presented is based on the most recent credit review performed. These credit quality indicators are defined as follows:

Pass - A pass rated credit is not adversely classified because it does not display any of the characteristics for adverse classification.

Special mention – A special mention credit has potential weaknesses that deserve management’s close attention. If uncorrected, such weaknesses may result in deterioration of the repayment prospects or collateral position at some future date. Special mention assets are not adversely classified and do not warrant adverse classification.

Substandard – A substandard loan is inadequately protected by the current net worth and payment capacity of the obligor or of the collateral pledged, if any. Loans classified as substandard generally have a well-defined weakness, or weaknesses, that jeopardize the liquidation of the debt. These loans are characterized by the distinct possibility of loss if the deficiencies are not corrected.

Doubtful – A loan that is classified as doubtful has all the weaknesses inherent in a loan classified as substandard with added characteristics that the weaknesses make collection or liquidation in full highly questionable and improbable, on the basis of currently existing facts, conditions and values.

Loss – Loans classified as a loss are considered uncollectible and of such little value that their continuing to be carried as a loan is not warranted. This classification is not necessarily equivalent to no potential for recovery or salvage value, but rather that it is not appropriate to defer a full write-off even though partial recovery may be effected in the future.

The following table provides information about credit quality indicators by the year of origination as of June 30, 2023:

	June 30, 2023
	Term Loans by Origination Year												Revolving
(In thousands)	2023		2022		2021		2020		2019		Prior		Loans		Total
Commercial Investor R/E:
Pass	$	221,130	$	1,401,988	$	1,210,529	$	689,275	$	552,876	$	958,510	$	24,855	$	5,059,163
Special Mention	6,297		10,298		30,536		—		93		2,880		—		50,104
Substandard	14,799		544		3,663		—		1,377		1,560		—		21,943
Doubtful	—		—		—		—		—		—		—		—
Total	$	242,226	$	1,412,830	$	1,244,728	$	689,275	$	554,346	$	962,950	$	24,855	$	5,131,210
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial Owner-Occupied R/E:
Pass	$	87,454	$	366,576	$	325,147	$	238,899	$	246,174	$	474,408	$	2,184	$	1,740,842
Special Mention	731		739		—		889		323		7,538		—		10,220
Substandard	3,296		3,753		815		351		5,988		4,870		—		19,073
Doubtful	—		—		—		—		—		—		—		—
Total	$	91,481	$	371,068	$	325,962	$	240,139	$	252,485	$	486,816	$	2,184	$	1,770,135
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial AD&C:
Pass	$	189,426	$	318,888	$	284,974	$	78,362	$	1,867	$	15,079	$	154,566	$	1,043,162
Special Mention	1,661		—		—		—		—		—		—		1,661
Substandard	350		569		—		—		—		—		—		919
Doubtful	—		—		—		—		—		—		—		—
Total	$	191,437	$	319,457	$	284,974	$	78,362	$	1,867	$	15,079	$	154,566	$	1,045,742
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial Business:
Pass	$	81,897	$	342,575	$	212,680	$	108,084	$	75,222	$	129,998	$	441,542	$	1,391,998
Special Mention	—		95		204		942		2,172		338		13,398		17,149
Substandard	1,255		2,231		1,766		994		2,581		1,818		3,822		14,467
Doubtful	—		—		—		—		—		—		—		—
Total	$	83,152	$	344,901	$	214,650	$	110,020	$	79,975	$	132,154	$	458,762	$	1,423,614
Current period gross charge-offs	$	—	$	—	$	324	$	—	$	—	$	99			$	423
Residential Mortgage:
Beacon score:
660-850	$	18,644	$	377,467	$	387,642	$	168,643	$	41,092	$	290,758	$	—	$	1,284,246
600-659	—		8,016		13,725		4,075		3,858		29,123		—		58,797
540-599	304		2,915		3,291		523		1,511		8,894		—		17,438
less than 540	—		363		3,006		3,448		3,008		15,437		—		25,262
Total	$	18,948	$	388,761	$	407,664	$	176,689	$	49,469	$	344,212	$	—	$	1,385,743
Current period gross charge-offs	$	—	$	—	$	43	$	—	$	10	$	107	$	—	$	160
Residential Construction:
Beacon score:
660-850	$	9,189	$	135,471	$	36,186	$	5,837	$	150	$	1,244	$	—	$	188,077
600-659	—		973		739		—		—		—		—		1,712
540-599	—		—		401		—		—		—		—		401
less than 540	500		—		—		—		—		—		—		500
Total	$	9,689	$	136,444	$	37,326	$	5,837	$	150	$	1,244	$	—	$	190,690
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Consumer:
Beacon score:
660-850	$	4,743	$	6,164	$	2,515	$	764	$	2,048	$	24,430	$	344,560	$	385,224
600-659	325		543		21		163		113		5,299		12,686		19,150
540-599	309		79		83		38		127		2,293		4,456		7,385
less than 540	224		178		248		291		486		2,750		6,569		10,746
Total	$	5,601	$	6,964	$	2,867	$	1,256	$	2,774	$	34,772	$	368,271	$	422,505
Current period gross charge-offs	$	—	$	1	$	—	$	—	$	—	$	1,594	$	87	$	1,682
Total loans	$	642,534	$	2,980,425	$	2,518,171	$	1,301,578	$	941,066	$	1,977,227	$	1,008,638	$	11,369,639

 The following table provides information about credit quality indicators by the year of origination as of December 31, 2022:

	December 31, 2022
	Term Loans by Origination Year												Revolving
(In thousands)	2022		2021		2020		2019		2018		Prior		Loans		Total
Commercial Investor R/E:
Pass	$	1,510,446	$	1,197,504	$	694,756	$	567,247	$	335,103	$	742,405	$	15,242	$	5,062,703
Special Mention	32,661		17,146		468		94		473		4,814		—		55,656
Substandard	557		1,896		—		—		8,239		1,043		—		11,735
Doubtful	—		—		—		—		—		—		—		—
Total	$	1,543,664	$	1,216,546	$	695,224	$	567,341	$	343,815	$	748,262	$	15,242	$	5,130,094
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial Owner-Occupied R/E:
Pass	$	391,340	$	328,657	$	240,738	$	260,114	$	140,841	$	381,386	$	1,167	$	1,744,243
Special Mention	4,567		—		1,301		1,740		2,066		7,323		—		16,997
Substandard	3,219		160		133		6,110		2,010		2,165		—		13,797
Doubtful	—		—		—		—		—		—		—		—
Total	$	399,126	$	328,817	$	242,172	$	267,964	$	144,917	$	390,874	$	1,167	$	1,775,037
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial AD&C:
Pass	$	366,096	$	439,468	$	113,713	$	34,340	$	14,816	$	—	$	119,727	$	1,088,160
Special Mention	1,073		—		—		—		—		—		795		1,868
Substandard	—		—		—		—		—		—		—		—
Doubtful	—		—		—		—		—		—		—		—
Total	$	367,169	$	439,468	$	113,713	$	34,340	$	14,816	$	—	$	120,522	$	1,090,028
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial Business:
Pass	$	330,598	$	223,245	$	95,787	$	105,922	$	77,891	$	78,009	$	508,839	$	1,420,291
Special Mention	127		458		1,107		7,787		498		322		13,225		23,524
Substandard	2,902		1,611		1,094		2,030		449		2,121		1,863		12,070
Doubtful	—		—		—		—		—		—		—		—
Total	$	333,627	$	225,314	$	97,988	$	115,739	$	78,838	$	80,452	$	523,927	$	1,455,885
Current period gross charge-offs	$	174	$	—	$	—	$	—	$	138	$	404	$	—	$	716
Residential Mortgage:
Beacon score:
660-850	$	330,109	$	344,062	$	171,330	$	41,883	$	51,651	$	262,570	$	—	$	1,201,605
600-659	4,571		6,196		1,173		3,925		6,041		24,006		—		45,912
540-599	369		4,013		1,439		1,256		1,931		6,945		—		15,953
less than 540	1,860		3,036		2,892		3,822		2,347		10,506		—		24,463
Total	$	336,909	$	357,307	$	176,834	$	50,886	$	61,970	$	304,027	$	—	$	1,287,933
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	24	$	131	$	—	$	155
Residential Construction:
Beacon score:
660-850	$	131,259	$	75,844	$	12,133	$	150	$	1,432	$	1,245	$	—	$	222,063
600-659	908		373		—		—		—		—		—		1,281
540-599	609		—		—		—		—		—		—		609
less than 540	—		819		—		—		—		—		—		819
Total	$	132,776	$	77,036	$	12,133	$	150	$	1,432	$	1,245	$	—	$	224,772
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Consumer:
Beacon score:
660-850	$	6,689	$	2,346	$	1,201	$	2,147	$	2,047	$	23,170	$	359,468	$	397,068
600-659	658		467		59		198		664		5,459		11,269		18,774
540-599	123		56		—		465		316		2,802		3,824		7,586
less than 540	156		57		40		133		209		2,918		6,016		9,529
Total	$	7,626	$	2,926	$	1,300	$	2,943	$	3,236	$	34,349	$	380,577	$	432,957
Current period gross charge-offs	$	—	$	5	$	15	$	—	$	13	$	20	$	181	$	234
Total loans	$	3,120,897	$	2,647,414	$	1,339,364	$	1,039,363	$	649,024	$	1,559,209	$	1,041,435	$	11,396,706

Other Real Estate Owned

Other real estate owned ("OREO") totaled $0.6 million at both June 30, 2023 and December 31, 2022, respectively. There were no consumer mortgage loans secured by residential real estate property for which formal foreclosure proceedings were in process as of June 30, 2023.

Modifications to Borrowers Experiencing Financial Difficulty

Effective January 1, 2023, the Company fully adopted provisions of ASU 2022-02 that eliminated accounting, classification and disclosures of loans modified into troubled debt restructurings.

As a part of our risk management practices, we may consider modifying a loan for a borrower experiencing a financial difficulty that provides a certain degree of a payment relief. Modification types primarily include a reduction in the interest rate or an extension of the existing term. We do not provide modifications that result in the reduction of the outstanding principal balance.

The following table presents the amounts at the end of the reporting period of the loans modified during the period to borrowers experiencing financial difficulty, disaggregated by the loan portfolio segment and type of modification granted:

	For the six months ended June 30, 2023
	Interest rate reduction				Term extension				Total
(in thousands)	Amount		% of total loan segment		Amount		% of total loan segment		Amount		% of total loan segment
Commercial Investor R/E	$	28,340	0.6	%	$	553	—	%	$	28,893	0.6	%
Commercial Owner-Occupied R/E	—		—	%	2,000		0.1	%	2,000		0.1	%
Commercial AD&C	—		—	%	350		—	%	350		—	%
Commercial Business	—		—	%	950		0.1	%	950		0.1	%
All Other loans	—		—	%	—		—	%	—		—	%
Total	$	28,340	0.2	%	$	3,853	—	%	$	32,193	0.3	%

Unfunded loan commitments on modifications for borrowers experiencing financial difficulty totaled $1.2 million at June 30, 2023. These commitments are not included in the table above.

The following table describes the financial effect of the modifications granted to borrowers experiencing financial difficulty during the six months ended June 30, 2023:

	Interest rate reduction	Term extension
Commercial Investor R/E	Reduced weighted average contractual interest rate from 8% to 5%	Added a weighted average of 5 months to the life of loans
Commercial Owner-Occupied R/E	—	Added a weighted average of 8 months to the life of loans
Commercial AD&C	—	Added a weighted average of 9 months to the life of loans
Commercial Business	—	Added a weighted average of 8 months to the life of loans

No loan modifications completed on or after January 1, 2023 for borrowers experiencing financial difficulty had a payment default during the six months ended June 30, 2023

The following table presents the performance of loans that have been modified during the six months ended June 30, 2023:

	For the six months ended June 30, 2023
(in thousands)	Current		30-89 days past due		90+ days past due		Non-accrual		Total
Commercial Investor R/E	$	28,680	$	213	$	—	$	—	$	28,893
Commercial Owner-Occupied R/E	2,000		—		—		—		2,000
Commercial AD&C	350		—		—		—		350
Commercial Business	950		—		—		—		950
All Other loans	—		—		—		—		—
Total	$	31,980	$	213	$	—	$	—	$	32,193

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GOODWILL AND OTHER INTANGIBLE ASSETS

6 Months Ended

Jun. 30, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND OTHER INTANGIBLE ASSETS

GOODWILL AND OTHER INTANGIBLE ASSETS

The amount of goodwill by reporting units is presented in the following table:

(In thousands)	Community Banking		Investment Management		Total
Balances at December 31, 2022	$	331,689	$	31,747	$	363,436
No activity	—		—		—
Balances at June 30, 2023	$	331,689	$	31,747	$	363,436

The gross carrying amounts and accumulated amortization of intangible assets and goodwill are presented at the dates indicated in the following table:

	June 30, 2023						Weighted Average Remaining Life	December 31, 2022						Weighted Average Remaining Life
(Dollars in thousands)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount			Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Amortizing intangible assets:
Core deposit intangibles	$	29,038	$	(18,486)	$	10,552	6.0 years	$	29,038	$	(16,694)	$	12,344	6.5 years
Other identifiable intangibles	13,906		(7,178)		6,728		8.2 years	13,906		(6,395)		7,511		8.8 years
Total amortizing intangible assets	$	42,944	$	(25,664)	$	17,280		$	42,944	$	(23,089)	$	19,855
Goodwill	$	363,436			$	363,436		$	363,436			$	363,436

The following table presents the estimated future amortization expense for amortizing intangible assets within the years ending December 31:

(In thousands)	Amount
Remaining 2023	$	2,465
2024	4,291
2025	3,530
2026	2,702
2027	1,945
Thereafter	2,347
Total amortizing intangible assets	$	17,280

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DEPOSITS

6 Months Ended

Jun. 30, 2023

Deposits [Abstract]

DEPOSITS

DEPOSITS

The following table presents the composition of deposits at the dates indicated:

(In thousands)	June 30, 2023		December 31, 2022
Noninterest-bearing deposits	$	3,079,896	$	3,673,300
Interest-bearing deposits:
Demand	1,413,027		1,435,454
Money market savings	2,918,253		3,213,045
Regular savings	731,985		513,360
Time deposits of less than $250,000	2,293,858		1,644,645
Time deposits of $250,000 or more	521,903		473,617
Total interest-bearing deposits	7,879,026		7,280,121
Total deposits	$	10,958,922	$	10,953,421

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BORROWINGS

6 Months Ended

Jun. 30, 2023

Debt Disclosure [Abstract]

BORROWINGS

BORROWINGS

Subordinated Debt

On March 15, 2022, the Company completed an offering of $200.0 million aggregate principal amount Fixed to Floating Rate Subordinated Notes due in 2032. The notes bear a fixed interest rate of 3.875% per year through March 29, 2027. Commencing on March 30, 2027, the notes will bear interest at a floating rate per annum equal to the benchmark rate (which is expected to be the three-month SOFR rate) plus a spread of 196.5 basis points, payable quarterly in arrears. The total amount of debt issuance costs incurred was $3.1 million, which are being amortized through the contractual life of the debt. The entire amount of the subordinated debt is considered Tier 2 capital under current regulatory guidelines.

On November 5, 2019, the Company completed an offering of $175.0 million aggregate principal amount Fixed to Floating Rate Subordinated Notes due in 2029. The notes bear a fixed interest rate of 4.25% per year through November 14, 2024. Beginning November 15, 2024, the interest rate will become a floating rate equal to three-month SOFR plus 262 basis points plus a spread adjustment of 0.26261 basis points through the remaining maturity or early redemption date of the notes. The interest will be paid in arrears semi-annually during the fixed rate period and quarterly during the floating rate period. The Company incurred $2.9 million of debt issuance costs which are being amortized through the contractual life of the debt. The entire amount of the subordinated debt is considered Tier 2 capital under current regulatory guidelines.

The following table provides information on subordinated debt as of the date indicated:

(In thousands)	June 30, 2023		December 31, 2022
Fixed to floating rate subordinated debt, 3.875%	$	200,000	$	200,000
Fixed to floating rate subordinated debt, 4.25%	175,000		175,000
Total subordinated debt	375,000		375,000
Less: Debt issuance costs	(4,496)		(4,795)
Long-term borrowings	$	370,504	$	370,205

Other Borrowings

At June 30, 2023 and December 31, 2022, the Company had $74.5 million and $62.0 million, respectively, of outstanding retail repurchase agreements.

The Company had no outstanding federal funds purchased at June 30, 2023 and $260.0 million at December 31, 2022. The available borrowing federal funds capacity under unsecured lines of credit with the correspondent banks was $1.0 billion and $1.6 billion at June 30, 2023 and December 31, 2022, respectively. At June 30, 2023, the Company also had $300.0 million outstanding borrowings through Federal Reserve's Bank Term Funding Program with additional available funds of $16.6 million.

At June 30, 2023, the Company had the ability to pledge collateral at prevailing market rates under a line of credit with the FHLB of $3.2 billion. FHLB availability based on pledged collateral at June 30, 2023, amounted to $2.6 billion, with $600.0 million outstanding. At December 31, 2022, the Company had the ability to pledge collateral at prevailing market rates under a line of credit with the FHLB of $3.2 billion. The availability of FHLB borrowings based on the collateral pledged at December 31, 2022 was $2.6 billion with $550.0 million outstanding.

Under a blanket lien, the Company has pledged qualifying residential mortgage loans amounting to $1.3 billion, commercial real estate loans amounting to $4.0 billion, home equity lines of credit (“HELOC”) amounting to $214.0 million, and multifamily loans amounting to $571.2 million at June 30, 2023, as collateral under the borrowing agreement with the FHLB. At December 31, 2022, the Company had pledged collateral of qualifying mortgage loans of $1.2 billion, commercial real estate loans of $3.6 billion, HELOC loans of $214.3 million, and multifamily loans of $514.8 million under the FHLB borrowing agreement.

The Company had secured lines of credit available from the Federal Reserve Bank and correspondent banks of $760.8 million and $718.6 million at June 30, 2023 and December 31, 2022, respectively, collateralized by loans, with no borrowings outstanding at the end of either period.

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STOCKHOLDERS' EQUITY	6 Months Ended
	Jun. 30, 2023
Stockholders' Equity Note [Abstract]
STOCKHOLDERS' EQUITY	STOCKHOLDERS' EQUITYOn March 30, 2022, the Company's board of directors authorized a stock repurchase plan that permits the repurchase of up to $50.0 million of the Company's common stock. During 2022, the Company repurchased and retired 625,710 common shares at an average price of $39.93 per share for the total cost of $25.0 million. The Company did not repurchase any shares of its common stock during the quarter ended June 30, 2023. Under the current authorization, common stock with a total value of up to $25.0 million remains available to be repurchased.

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SHARE BASED COMPENSATION

6 Months Ended

Jun. 30, 2023

Share-Based Payment Arrangement [Abstract]

SHARE BASED COMPENSATION

SHARE BASED COMPENSATION

The Company’s 2015 Omnibus Incentive Plan ("Omnibus Incentive Plan") was approved on May 6, 2015 and provides for the granting of incentive stock options, non-qualifying stock options, stock appreciation rights, restricted stock grants, restricted stock units and performance share units to selected directors and employees on a periodic basis at the discretion of the Company’s Board of Directors. The Omnibus Incentive Plan authorizes the issuance of up to 1,500,000 shares of common stock, of which 367,726 are available for issuance at June 30, 2023, has a term of 10 years, and is administered by a committee of at least three directors appointed by the Board of Directors. Options granted under the plan have an exercise price which may not be less than 100% of the fair market value of the common stock on the date of the grant and must be exercised within seven or 10 years from the date of grant depending on the terms of the grant agreement. The exercise price of stock options must be paid for in full in cash or shares of common stock, or a combination of both. The board committee has the discretion when making a grant of stock options to impose restrictions on the shares to be purchased upon the exercise of such options. The Company generally issues authorized but previously unissued shares to satisfy option exercises.

Compensation expense is recognized on a straight-line basis over the vesting period of the respective stock option, restricted stock, restricted stock unit grant or performance share units. The Company recognized compensation expense of $2.7 million and $3.2 million for the three months ended June 30, 2023 and 2022, respectively, and of $4.0 million and $4.7 million, for the six months ended June 30, 2023 and 2022, respectively, related to the awards of restricted stock award grants, restricted stock unit grants and performance share unit grants. There was no unrecognized compensation cost related to stock options as of June 30, 2023. The total of unrecognized compensation cost related to restricted stock awards, restricted stock unit grants, and performance share unit grants was approximately $9.5 million as of June 30, 2023. That cost is expected to be recognized over a weighted average period of approximately 2.04 years.

During the six months ended June 30, 2023, the Company granted 276,252 restricted stock units and performance share units, of which 62,124 units are subject to achievement of certain performance conditions measured over a three-year performance period and 214,128 restricted stock units are subject to a three year vesting schedule. The Company did not grant any stock options under the Omnibus Incentive Plan during the six months ended June 30, 2023.

A summary of the activity for the Company’s restricted stock, restricted stock units and performance share units for the period indicated is presented in the following table:

	Number of Common Shares/Units	Weighted Average Grant-Date Fair Value
Non-vested at January 1, 2023	389,475	$	37.44
Granted	276,252	$	27.06
Vested	(201,244)	$	33.40
Forfeited/ cancelled	(6,134)	$	33.97
Non-vested at June 30, 2023	458,349	$	32.99

A summary of share option activity for the period indicated is reflected in the following table:

	Number of Common Shares	Weighted Average Exercise Share Price		Weighted Average Contractual Remaining Life (Years)	Aggregate Intrinsic Value (in thousands)
Balance at January 1, 2023	144,047	$	16.61	1.6 years	$	2,633
Granted	—	$	—
Exercised	(40,921)	$	12.65		$	474
Forfeited	—	$	—
Expired	(3,338)	$	27.46
Balance at June 30, 2023	99,788	$	17.87	1.4 years	$	804
Exercisable at June 30, 2023	99,788	$	17.87	1.4 years	$	804

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PENSION PLAN

6 Months Ended

Jun. 30, 2023

Retirement Benefits [Abstract]

PENSION PLAN

PENSION PLAN

Defined Benefit Pension Plan

The Company has a qualified, noncontributory, defined benefit pension plan (the “Plan”). Benefits after January 1, 2005 are based on the benefit earned as of December 31, 2004, plus benefits earned in future years of service based on the employee’s compensation during each such year. All benefit accruals for employees were frozen as of December 31, 2007 based on past service and thus salary increases and additional years of service after such date no longer affect the defined benefit provided by the Plan, although additional vesting may continue to occur.

The Company's funding policy is to contribute amounts to the Plan sufficient to meet the minimum funding requirements of the Employee Retirement Income Security Act of 1974 (“ERISA”), as amended. In addition, the Company contributes additional amounts as it deems appropriate based on benefits attributed to service prior to the date of the Plan freeze. The Plan invests primarily in a diversified portfolio of managed fixed income and equity funds.

On March 30, 2022, the Board of Directors approved the termination of the Plan to be effective as of June 30, 2022. The Company has executed plan amendments regarding the Plan termination and has received a determination letter from the Internal Revenue Service (“IRS”) as to the tax-qualified status of the Plan at the time of termination. The Company has also filed appropriate notices and documents related to the Plan’s termination and wind-down with the Pension Benefit Guaranty Corporation (“PBGC”).

The Company will make an additional cash contribution, if necessary, in order to fully fund the Plan on a plan termination basis, followed by the purchase of annuity contracts to transfer its remaining liabilities under the Plan. The actual amount of this cash contribution, if any, will depend upon the nature and timing of participant settlements, as well as prevailing market conditions. In addition, the Company expects to recognize a non-cash pension settlement charge upon settlement of the obligations of the Plan.

All participants who are not already receiving annuities have been given the opportunity to elect a lump sum payout. Benefit obligations of participants who do not elect a lump sum or who are being paid in an annuity form will be transferred under an annuity contract from a highly-rated insurance company that will pay and administer future benefit payments. There will be no change in the benefit earned by Plan participants as a result of these actions. The Company anticipates distributing assets from the Plan in the third quarter of 2023.

The components of net periodic benefit cost for the periods indicated are presented in the following table:

	Three Months Ended June 30,				Six Months Ended June 30,
(In thousands)	2023		2022		2023		2022
Interest cost on projected benefit obligation	$	437	$	326	$	875	$	651
Expected return on plan assets	(373)		(352)		(746)		(705)
Recognized net actuarial loss	226		195		451		391
Net periodic benefit cost	$	290	$	169	$	580	$	337

The decision as to whether or not to make a plan contribution and the amount of any such contribution is dependent on a number of factors. Such factors include the investment performance of Plan assets in the current economy and, since the Plan is currently frozen, the remaining investment horizon of the Plan. The Company did not make any contribution to the Plan during the six months ended June 30, 2023.

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NET INCOME PER COMMON SHARE

6 Months Ended

Jun. 30, 2023

Earnings Per Share [Abstract]

NET INCOME PER COMMON SHARE

NET INCOME PER COMMON SHARE

The calculation of net income per common share for the periods indicated is presented in the following table:

	Three Months Ended June 30,				Six Months Ended June 30,
(Dollars and amounts in thousands, except per share data)	2023		2022		2023		2022
Net income	$	24,745	$	54,800	$	75,998	$	98,735
Distributed and undistributed earnings allocated to participating securities	(33)		(194)		(177)		(476)
Net income attributable to common shareholders	$	24,712	$	54,606	$	75,821	$	98,259
Total weighted average outstanding shares	44,894		45,184		44,860		45,303
Less: Weighted average participating securities	(61)		(160)		(104)		(221)
Basic weighted average common shares	44,833		45,024		44,756		45,082
Dilutive weighted average common stock equivalents	56		87		121		140
Diluted weighted average common shares	44,889		45,111		44,877		45,222
Basic net income per common share	$	0.55	$	1.21	$	1.69	$	2.18
Diluted net income per common share	$	0.55	$	1.21	$	1.69	$	2.17
Anti-dilutive shares	93		—		30		—

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ACCUMULATED OTHER COMPREHENSIVE LOSS

6 Months Ended

Jun. 30, 2023

Equity [Abstract]

ACCUMULATED OTHER COMPREHENSIVE LOSS

ACCUMULATED OTHER COMPREHENSIVE LOSS

Comprehensive income/ (loss) is defined as net income/ (loss) plus transactions and other occurrences that are the result of non-owner changes in equity. For Condensed Consolidated Financial Statements presented for the Company, non-owner changes in equity are comprised of unrealized gains or losses on investments available-for-sale and held-to-maturity, and any minimum pension liability adjustments.

The following table presents the activity in net accumulated other comprehensive income/ (loss) and the components of the activity for the periods indicated:

(In thousands)	Unrealized Gains/(Losses) on Debt Securities Available-for-Sale		Defined Benefit Pension Plan		Unrealized Losses on Debt Securities Transferred from Available-for-Sale to Held-to-Maturity		Total
Balance at January 1, 2023	$	(113,513)	$	(8,002)	$	(10,436)	$	(131,951)
Other comprehensive loss before reclassification from accumulated other comprehensive loss, net of tax	5,347		—		—		5,347
Reclassifications from accumulated other comprehensive loss to earnings, net of tax	—		336		643		979
Current period change in other comprehensive loss, net of tax	5,347		336		643		6,326
Balance at June 30, 2023	$	(108,166)	$	(7,666)	$	(9,793)	$	(125,625)

(In thousands)	Unrealized Gains/ (Losses) on Debt Securities Available-for-Sale		Defined Benefit Pension Plan		Unrealized Losses on Debt Securities Transferred from Available-for-Sale to Held-to-Maturity		Total
Balance at January 1, 2022	$	(336)	$	(8,203)	$	—	$	(8,539)
Other comprehensive income before reclassification, net of tax	(77,922)		—		(12,083)		(90,005)
Reclassifications from accumulated other comprehensive income, net of tax	(34)		291		834		1,091
Current period change in other comprehensive income, net of tax	(77,956)		291		(11,249)		(88,914)
Balance at June 30, 2022	$	(78,292)	$	(7,912)	$	(11,249)	$	(97,453)

The following table provides the information on the reclassification adjustments out of accumulated other comprehensive income/ (loss) for the periods indicated:

	Six Months Ended June 30,
(In thousands)	2023		2022
Unrealized gains on available-for-sale debt securities:
Affected line item in the Statements of Income:
Investment securities gains	$	—	$	46
Income before taxes	—		46
Tax expense	—		(12)
Net income	$	—	$	34
Amortization of unrealized losses on debt securities transferred from available-for-sale to held-to-maturity:
Affected line item in the Statements of Income:
Interest and dividends on investment securities (1)	$	(863)	$	(1,122)
Income before taxes	(863)		(1,122)
Tax benefit	220		288
Net loss	$	(643)	$	(834)
Amortization of defined benefit pension plan items:
Affected line item in the Statements of Income:
Recognized actuarial loss (2)	$	(451)	$	(391)
Income before taxes	(451)		(391)
Tax benefit	115		100
Net loss	$	(336)	$	(291)

(1)Amortization of unrealized losses on held-to-maturity debt securities is fully offset by accretion of a discount on held-to-maturity debt securities with no overall impact on net income and yield.

(2)This amount is included in the computation of net periodic benefit cost. See Note 10 for additional information on the pension plan.

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LEASES

6 Months Ended

Jun. 30, 2023

Leases [Abstract]

LEASES

LEASES

The Company leases real estate properties for its network of bank branches, financial centers and corporate offices. All of the Company’s leases are currently classified as operating. Most lease agreements include one or more options to renew, with renewal terms that can extend the original lease term from one to twenty years or more. The Company does not sublease any of its leased real estate properties.

The following table provides information regarding the Company's leases as of the dates indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Components of lease expense:
Operating lease cost (resulting from lease payments)	$	2,712	$	2,738	$	5,427	$	5,504
Supplemental cash flow information related to leases:
Operating cash flows from operating leases	$	2,861	$	2,893	$	5,749	$	5,832
ROU assets obtained in the exchange for lease liabilities due to:
New leases	$	—	$	—	$	703	$	—
Acquisitions	$	—	$	—	$	—	$	—
					June 30, 2023		December 31, 2022
Supplemental balance sheet information related to leases:
Operating lease ROU assets					$	50,397	$	48,910
Operating lease liabilities					$	58,568	$	57,402
Other information related to leases:
Weighted average remaining lease term of operating leases					8.3 years		8.6 years
Weighted average discount rate of operating leases					3.22%		3.02%

 

ROU assets and lease liabilities are recorded in other assets and other liabilities, respectively, in the Condensed Consolidated Statements of Condition.

At June 30, 2023, the maturities of the Company’s operating lease liabilities were as follows:

 

(In thousands)	Amount
Maturity:
Remaining 2023	$	5,740
2024	10,751
2025	9,068
2026	8,320
2027	6,922
Thereafter	26,824
Total undiscounted lease payments	67,625
Less: Present value discount	(9,057)
Lease liability	$	58,568

At June 30, 2023, the Company had one operating lease that has not yet commenced operations and is expected to commence operations during the second half of 2023. The total amount of ROU asset and lease liability at June 30, 2023 was $0.7 million. The Company does not have any lease arrangements with any of its related parties as of June 30, 2023.

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DERIVATIVES	6 Months Ended
	Jun. 30, 2023
Derivative Instruments and Hedging Activities Disclosure [Abstract]
DERIVATIVES	DERIVATIVESThe Company has entered into interest rate swaps (“swaps”) to facilitate customer transactions and meet their financing needs. These swaps qualify as derivatives, but are not designated as hedging instruments. Interest rate swap contracts involve the risk of dealing with counterparties and their ability to meet contractual terms. When the fair value of a derivative instrument contract is positive, this generally indicates that the counterparty or customer owes the Company and results in credit risk to the Company. When the fair value of a derivative instrument contract is negative, the Company owes the customer or counterparty and, therefore, has no credit risk. The notional value of the swaps outstanding was $334.5 million as of June 30, 2023 compared to $339.1 million as of December 31, 2022. The fair values of swap positions net to zero to minimize the potential impact on the Company’s Condensed Consolidated Financial Statements. Fair values of the swaps are carried as both gross assets and gross liabilities in other assets and other liabilities, respectively, in the Condensed Consolidated Statements of Condition. The associated net gains and losses on the swaps are recorded in Other income in the Condensed Consolidated Statements of Income.

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LITIGATION	6 Months Ended
	Jun. 30, 2023
Commitments and Contingencies Disclosure [Abstract]
LITIGATION	LITIGATIONIn the ordinary course of business, the Company and its subsidiaries are subject to various pending or threatened legal proceedings in which claims for monetary damages are asserted. After consultation with legal counsel, management does not anticipate that the ultimate liability, if any, arising out of these legal matters will have a material adverse effect on the Company's financial condition, operating results or liquidity.

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FAIR VALUE

6 Months Ended

Jun. 30, 2023

Fair Value Disclosures [Abstract]

FAIR VALUE

FAIR VALUE

GAAP provides entities the option to measure eligible financial assets, financial liabilities and commitments at fair value (i.e. the fair value option), on an instrument-by-instrument basis, that are otherwise not permitted to be accounted for at fair value under other accounting standards. The election to use the fair value option is available when an entity first recognizes a financial asset or financial liability or upon entering into a commitment. Subsequent changes in fair value must be recorded in earnings. The Company applies the fair value option on residential mortgage loans held for sale. The fair value option on residential mortgage loans held for sale allows the recognition of gains on the sale of mortgage loans to more accurately reflect the timing and economics of the transaction.

The standard for fair value measurement establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below.

Basis of Fair Value Measurement:

Level 1- Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2- Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability;

Level 3- Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e. supported by little or no market activity).

A financial instrument’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement.

Changes to interest rates may result in changes in the cash flows due to prepayments or extinguishments. Accordingly, changes to interest rates could result in higher or lower measurements of the fair values.

Assets and Liabilities

Residential mortgage loans held for sale

Residential mortgage loans held for sale are valued based on quotations from the secondary market for similar instruments and are classified as Level 2 in the fair value hierarchy.

Investment securities available-for-sale

U.S. treasuries and government agencies securities and mortgage-backed and asset-backed securities

Valuations are based on active market data and use of evaluated broker pricing models that vary based by asset class and includes available trade, bid, and other market information. Generally, the methodology includes broker quotes, proprietary models, descriptive terms, and databases coupled with extensive quality control programs. Quality control evaluation processes use available market, credit and deal level information to support the evaluation of the security. Additionally, proprietary models and pricing systems, mathematical tools, actual transacted prices, integration of market developments and experienced evaluators are used to determine the value of a security based on a hierarchy of market information regarding a security or securities with similar characteristics. The Company does not adjust the quoted price for such securities. Such instruments are classified within Level 2 in the fair value hierarchy.

State and municipal securities

The Company primarily uses prices obtained from third-party pricing services to determine the fair value of securities. The Company independently evaluates and corroborates the fair value received from pricing services through various methods and techniques, including references to dealer or other market quotes, by reviewing valuations of comparable instruments,

and by comparing the prices realized on the sale of similar securities. Such securities are classified within Level 2 in the fair value hierarchy.

Interest rate swap agreements

Interest rate swap agreements are measured by alternative pricing sources using a discounted cash flow method that incorporates current market interest rates. Based on the complex nature of interest rate swap agreements, the markets these instruments trade in are not as efficient and are less liquid than that of the more mature Level 1 markets. These characteristics classify interest rate swap agreements as Level 2 in the fair value hierarchy.

Assets Measured at Fair Value on a Recurring Basis

The following tables set forth the Company’s financial assets and liabilities at the dates indicated that were accounted for or disclosed at fair value. Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement:

	June 30, 2023
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
(In thousands)	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Residential mortgage loans held for sale (1)	$	—	$	21,476	$	—	$	21,476
Available-for-sale debt securities:
U.S. treasuries and government agencies	—		94,345		—		94,345
State and municipal	—		268,251		—		268,251
Mortgage-backed and asset-backed	—		781,092		—		781,092
Total available-for-sale debt securities	—		1,143,688		—		1,143,688
Interest rate swap agreements	—		18,286		—		18,286
Total assets	$	—	$	1,183,450	$	—	$	1,183,450
Liabilities:
Interest rate swap agreements	$	—	$	(18,286)	$	—	$	(18,286)
Total liabilities	$	—	$	(18,286)	$	—	$	(18,286)

 (1) The outstanding principal balance for residential loans held for sale as of June 30, 2023 was $21.7 million.

	December 31, 2022
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
(In thousands)	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Residential mortgage loans held for sale (1)	$	—	$	11,706	$	—	$	11,706
Investments available-for-sale:
U.S. treasuries and government agencies	—		93,622		—		93,622
State and municipal	—		265,997		—		265,997
Mortgage-backed and asset-backed	—		854,919		—		854,919
Total investments available-for-sale	—		1,214,538		—		1,214,538
Interest rate swap agreements	—		18,596		—		18,596
Total assets	$	—	$	1,244,840	$	—	$	1,244,840
Liabilities:
Interest rate swap agreements	$	—	$	(18,596)	$	—	$	(18,596)
Total liabilities	$	—	$	(18,596)	$	—	$	(18,596)

 (1) The outstanding principal balance for residential loans held for sale as of December 31, 2022 was $11.3 million.

Assets Measured at Fair Value on a Nonrecurring Basis

The following tables set forth the Company’s financial assets subject to fair value adjustments on a nonrecurring basis at the date indicated that are valued at the lower of cost or market. Assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement:

	June 30, 2023
(In thousands)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total		Total Losses
Loans	$	—	$	—	$	—	$	—	$	—
Other real estate owned	—		—		611		611		(104)
Total	$	—	$	—	$	611	$	611	$	(104)

	December 31, 2022
(In thousands)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total		Total Losses
Loans (1)	$	—	$	—	$	190	$	190	$	(384)
Other real estate owned	—		—		645		645		(105)
Total	$	—	$	—	$	835	$	835	$	(489)

(1) Amounts represent the fair value of collateral for collateral dependent non-accrual loans allocated to the allowance for credit losses. Fair values are determined using actual market prices (Level 2), independent third-party valuations and borrower records, discounted as appropriate (Level 3).

At June 30, 2023, non-accrual loans totaling $63.5 million had estimated fair value of $47.3 million as a result of individual credit loss allowances of $16.2 million based on the most recent value of the collateral. Collateral dependent loans totaling $26.2 million had an estimated fair value of $19.3 million at December 31, 2022 as a result of individual credit loss allowances of $6.9 million.

Fair value of the collateral dependent loans is measured based on the loan’s observable market price or the fair value of the collateral (less estimated selling costs). Collateral may be real estate and/or business assets such as equipment, inventory and/or accounts receivable. The value of business equipment, inventory and accounts receivable collateral is based on net book value on the business’ financial statements and, if necessary, discounted based on management’s review and analysis. Appraised and reported values may be discounted based on management’s historical experience, changes in market conditions from the time of valuation, and/or management’s expertise and knowledge of the client and client’s business. Collateral dependent loans are reviewed and evaluated on at least a quarterly basis for additional individual reserve and adjusted accordingly, based on the factors identified above.

OREO is adjusted to fair value upon acquisition of the real estate collateral. Subsequently, OREO is carried at the lower of carrying value or fair value. The estimated fair value for OREO included in Level 3 is determined by independent market based appraisals and other available market information, less costs to sell, that may be reduced further based on market expectations or an executed sales agreement. If the fair value of the collateral deteriorates subsequent to initial recognition, the Company records the OREO as a nonrecurring Level 3 adjustment. Valuation techniques are consistent with those techniques applied in prior periods.

Fair Value of Financial Instruments

The Company discloses fair value information, based on the exit price notion, of financial instruments that are not measured at fair value in the financial statements. Fair value is the amount at which a financial instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation, and is best evidenced by a quoted market price, if one exists.

Quoted market prices, where available, are shown as estimates of fair market values. Because no quoted market prices are available for a significant portion of the Company's financial instruments, the fair value of such instruments has been derived based on the amount and timing of future cash flows and estimated discount rates based on observable inputs (“Level 2”) or unobservable inputs (“Level 3”).

Present value techniques used in estimating the fair value of many of the Company's financial instruments are significantly affected by the assumptions used. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, could not be realized in immediate cash settlement of the instrument. Additionally, the accompanying estimates of fair values are only representative of the fair values of the individual financial assets and liabilities, and should not be considered an indication of the fair value of the Company. Management utilizes internal models used in asset liability management to determine the fair values disclosed below. Other investments include FRB and FHLB stock, whose carrying amounts approximate fair values based on the redemption provisions of each entity.

The carrying amounts and fair values of the Company’s financial instruments at the dates indicated are presented in the following tables:

					Fair Value Measurements
	June 30, 2023				Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
(In thousands)	Carrying Amount		Estimated Fair Value
Financial assets:
Cash and cash equivalents	$	430,127	$	430,127	$	430,127	$	—	$	—
Residential mortgage loans held for sale	21,476		21,476		—		21,476		—
Available-for-sale debt securities	1,143,688		1,143,688		—		1,143,688		—
Held-to-maturity debt securities	247,814		208,662		—		208,662		—
Other investments	72,052		72,052		—		72,052		—
Loans, net of allowance	11,249,352		10,467,917		—		—		10,467,917
Interest rate swap agreements	18,286		18,286		—		18,286		—
Accrued interest receivable	42,388		42,388		42,388		—		—
Bank owned life insurance	156,874		156,874		—		156,874		—
Financial liabilities:
Time deposits	$	2,815,761	$	2,786,157	$	—	$	2,786,157	$	—
Other deposits	8,143,161		8,143,161		8,143,161		—		—
Securities sold under retail repurchase agreements and
federal funds purchased	374,510		374,510		—		374,510		—
Advances from FHLB	600,000		591,850		—		591,850		—
Subordinated debt	370,504		336,107		—		—		336,107
Interest rate swap agreements	18,286		18,286		—		18,286		—
Accrued interest payable	24,436		24,436		24,436		—		—

					Fair Value Measurements
	December 31, 2022				Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
(In thousands)	Carrying Amount		Estimated Fair Value
Financial assets:
Cash and cash equivalents	$	192,232	$	192,232	$	192,232	$	—	$	—
Residential mortgage loans held for sale	11,706		11,706		—		11,706		—
Investments available-for-sale	1,214,538		1,214,538		—		1,214,538		—
Held-to-maturity debt securities	259,452		220,123		—		220,123		—
Other investments	69,218		69,218		—		69,218		—
Loans, net of allowance	11,260,464		11,020,992		—		—		11,020,992
Interest rate swap agreements	18,596		18,596		—		18,596		—
Accrued interest receivable	41,172		41,172		41,172		—		—
Bank owned life insurance	153,016		153,016		—		153,016		—
Financial liabilities:
Time deposits	$	2,118,262	$	2,082,319	$	—	$	2,082,319	$	—
Other deposits	8,835,159		8,835,159		8,835,159		—		—
Securities sold under retail repurchase agreements and
federal funds purchased	321,967		321,967		—		321,967		—
Advances from FHLB	550,000		549,530		—		549,530		—
Subordinated debt	370,205		332,470		—		—		332,470
Interest rate swap agreements	18,596		18,596		—		18,596		—
Accrued interest payable	10,867		10,867		10,867		—		—

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Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Pay vs Performance Disclosure
Net income	$ 24,745	$ 54,800	$ 75,998	$ 98,735

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Insider Trading Arrangements	3 Months Ended
	Jun. 30, 2023
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

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SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Jun. 30, 2023

Accounting Policies [Abstract]

Nature of Operations

Nature of Operations

Sandy Spring Bancorp, Inc. ("Bancorp" or, together with its subsidiaries, the "Company"), a Maryland corporation, is the bank holding company for Sandy Spring Bank (the “Bank”). Independent and community-oriented, the Bank offers a broad range of commercial banking, retail banking, mortgage services and trust services throughout central Maryland, Northern Virginia, and the greater Washington, D.C. market. The Bank also offers a comprehensive menu of wealth management services through its subsidiaries, West Financial Services, Inc. (“West Financial”) and SSB Wealth Management, Inc. (d/b/a Rembert Pendleton Jackson, "RPJ”).

Basis of Presentation

Basis of Presentation

The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America (“GAAP”), prevailing practices within the financial services industry for interim financial information and Rule 10-01 of Regulation S-X. Accordingly, the interim financial statements do not include all of the information and notes required for complete financial statements. The following summary of significant accounting policies of the Company is presented to assist the reader in understanding the financial and other data presented in this report. Operating results for the six months ended June 30, 2023 are not necessarily indicative of the results that may be expected for any future periods or for the year ending December 31, 2023. In the opinion of management, all adjustments necessary for a fair presentation of the results of the interim periods have been included. The Company has evaluated subsequent events through the date of the issuance of its financial statements.

These statements should be read in conjunction with the financial statements and accompanying notes included in the Company’s 2022 Annual Report on Form 10-K as filed with the Securities and Exchange Commission (“SEC”) on February 21, 2023. There have been no significant changes to any of the Company’s accounting policies as disclosed in the 2022 Annual Report on Form 10-K.

Principles of Consolidation

Principles of Consolidation

The unaudited Condensed Consolidated Financial Statements include the accounts of the Company and its wholly-owned subsidiary, Sandy Spring Bank, and its subsidiaries. Consolidation has resulted in the elimination of all intercompany accounts and transactions.

Use of Estimates

Use of Estimates

The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements, in addition to affecting the reported amounts of revenues earned and expenses incurred during the reporting period. Actual results could differ from those estimates. Estimates that could change significantly relate to the provision for credit losses and the related allowance, potential impairment of goodwill or other intangible assets, valuation of investment securities and the determination of whether available-for-sale debt securities with fair values less than amortized costs are impaired and require an allowance for credit losses, valuation of other real estate owned, valuation of share based compensation, the assessment that a liability should be recognized with respect to any matters under litigation, the calculation of current and deferred income taxes, and the actuarial projections related to pension expense and the related liability.

Cash Flows

Cash Flows

For purposes of reporting cash flows, cash and cash equivalents include cash and due from banks, federal funds sold and interest-bearing deposits with banks (items with stated original maturity of three months or less).

Revenue from Contracts with Customers

Revenue from Contracts with Customers

The Company’s revenue includes net interest income on financial instruments and non-interest income. Specific categories of revenue are presented in the Condensed Consolidated Statements of Income. Most of the Company’s revenue is not within the scope of Accounting Standard Codification (“ASC”) 606 – Revenue from Contracts with Customers. For revenue within the scope of ASC 606, the Company provides services to customers and has related performance obligations. The revenue from such services is recognized upon satisfaction of all contractual performance obligations. The following discusses key revenue streams within the scope of this revenue recognition guidance.

West Financial and RPJ provide comprehensive investment management and financial planning services. Wealth management income is comprised of income for providing trust, estate and investment management services. Trust services include acting as

a trustee for corporate or personal trusts. Investment management services include investment management, record-keeping and reporting of security portfolios. Fees for these services are recognized based on a contractually-agreed fixed percentage applied to net assets under management at the end of each reporting period. The Company does not charge/recognize any performance-based fees.

Prior to the sale of its assets in June 2022, Sandy Spring Insurance Corporation performed the function of an insurance intermediary by introducing the policyholder and insurer and was compensated by a commission fee for placement of an insurance policy. Sandy Spring Insurance did not provide any captive management services or any claim handling services. Commission fees were set as a percentage of the premium for the insurance policy for which Sandy Spring Insurance was a producer. Sandy Spring Insurance recognized revenue when the insurance policy was contractually agreed to by the insurer and policyholder (at transaction date).

Service charges on deposit accounts are earned on depository accounts for consumer and commercial account holders and include fees for account and overdraft services. Account services include fees for event-driven services and periodic account maintenance activities. An obligation for event-driven services is satisfied at the time of the event when service is delivered and revenue recognized as earned. Obligation for maintenance activities is satisfied over the course of each month and revenue is recognized at month end. The overdraft services obligation is satisfied at the time of the overdraft and revenue is recognized as earned.

Loan Financing Receivables

Loan Financing Receivables

The Company’s financing receivables consist primarily of loans that are stated at their principal balance outstanding, net of any unearned income, acquisition fair value marks and deferred loan origination fees and costs. Interest income on loans is accrued at the contractual rate based on the principal balance outstanding. Loan origination fees, net of certain direct origination costs, are deferred and recognized as an adjustment of the related loan yield using the interest method.

Loans are considered past due or delinquent when the principal or interest due in accordance with the contractual terms of the loan agreement or any portion thereof remains unpaid after the due date of the scheduled payment. Immaterial shortfalls in payment amounts do not necessarily result in a loan being considered delinquent or past due. If any payments are past due and subsequent payments are resumed without payment of the delinquent amount, the loan shall continue to be considered past due. Whenever any loan is reported delinquent on a principal or interest payment or portion thereof, the amount reported as delinquent is the outstanding principal balance of the loan.

Loans, except for consumer installment loans, are placed into non-accrual status when any portion of the loan principal or interest becomes 90 days past due. Management may determine that certain circumstances warrant earlier discontinuance of interest accruals on specific loans if an evaluation of other relevant factors (such as bankruptcy, interruption of cash flows, etc.) indicates collection of amounts contractually due is unlikely. These loans are considered, collectively, to be non-performing loans. Consumer installment loans that are not secured by real estate are not placed on non-accrual, but are charged down to their net realizable value when they are four months past due. Loans designated as non-accrual have all previously accrued but unpaid interest reversed. Interest income is not recognized on non-accrual loans. All payments received on non-accrual loans are applied using a cost-recovery method to reduce the outstanding principal balance until the loan returns to accrual status. Loans may be returned to accrual status when all principal and interest amounts contractually due are brought current and future payments are reasonably assured.

On January 1, 2023, the Company adopted provisions of ASU 2022-02, "Financial Instruments - Credit Losses (Topic 326)", which eliminated accounting guidance for TDRs by creditors. Prior to the effective adoption date, the Company considered loans to be TDRs if their terms were restructured (e.g., interest rates, loan maturity date, payment and amortization period, etc.) in circumstances that provided a payment concession to a borrower experiencing financial difficulty. Loans could be removed from a TDR category if the borrower no longer experienced financial difficulty, a re-underwriting event took place, and the revised loan terms of the subsequent restructuring agreement were considered to be consistent with terms that could be obtained in the market for loans with comparable credit risk. Subsequent to the effective adoption date, the Company continues to offer modifications to certain borrowers experiencing financial difficulty, mainly in the form of interest rate concessions or term extensions, without classifying and accounting for them as TDRs.

Allowance for Credit Losses

Allowance for Credit Losses

The allowance for credit losses (“allowance” or “ACL”) represents an amount which, in management's judgment, reflects the lifetime expected losses that may be sustained on outstanding loans at the balance sheet date based on the evaluation of the size and current risk characteristics of the loan portfolio, past events, current conditions, reasonable and supportable forecasts of future economic conditions and prepayment experience. The allowance is measured and recorded upon the initial recognition of

a financial asset. The allowance is reduced by charge-offs, net of recoveries of previous losses, and is increased or decreased by a provision or credit for credit losses, which is recorded as a current period expense.

Determination of the appropriateness of the allowance is inherently complex and requires the use of significant and highly subjective estimates. The reasonableness of the allowance is reviewed periodically by the Risk Committee of the Board of Directors and formally approved quarterly by that same committee of the Board.

The Company’s methodology for estimating the allowance includes: (1) a collective quantified reserve that reflects the Company’s historical default and loss experience adjusted for expected economic conditions throughout a reasonable and supportable period and the Company’s prepayment and curtailment rates; (2) collective qualitative factors that consider the expected impact of certain factors not fully captured in the collective quantified reserve, including concentrations of the loan portfolio, expected changes to the economic forecasts, large relationships, early delinquencies, and factors related to credit administration, including, among others, loan-to-value ratios, borrowers’ risk rating and credit score migrations; and (3) individual allowances on collateral-dependent loans where borrowers are experiencing financial difficulty or when the Company determines that the foreclosure is probable. The Company excludes accrued interest from the measurement of the allowance as the Company has a non-accrual policy to reverse any accrued, uncollected interest income as loans are moved to non-accrual status.

Loans are pooled into segments based on the similar risk characteristics of the underlying borrowers, in addition to consideration of collateral type, industry and business purpose of the loans. Portfolio segments used to estimate the allowance are the same as portfolio segments used for general credit risk management purposes. Refer to Note 4 for more details on the Company’s portfolio segments.

The Company applies two calculation methodologies to estimate the collective quantified component of the allowance: discounted cash flows method and weighted average remaining life method. Allowance estimates on commercial acquisition, development and construction (“AD&C”) and residential construction segments are based on the weighted average remaining life method. Allowance estimates on all other portfolio segments are based on the discounted cash flows method. Segments utilizing the discounted cash flows method are further sub-segmented into risk level pools, determined either by risk rating for commercial loans or Beacon Scores ranges for residential and consumer loans. To better manage risk and reasonably determine the sufficiency of reserves, this segregation allows the Company to monitor the allowance component applicable to higher risk loans separate from the remainder of the portfolio. Collective calculation methodologies utilize the Company’s historical default and loss experience adjusted for future economic forecasts. The reasonable and supportable forecast period represents a two-year economic outlook for the applicable economic variables. Following the end of the reasonable and supportable forecast period expected losses revert back to the historical mean over the next two years on a straight-line basis. Economic variables that have the most significant impact on the allowance include: unemployment rate, house price index and business bankruptcies. Contractual loan level cash flows within the discounted cash flows methodology are adjusted for the Company’s historical prepayment and curtailment rate experience.

The individual reserve assessment is applied to collateral dependent loans where borrowers are experiencing financial difficulty or when the Company determines that a foreclosure is probable. The determination of the fair value of the collateral depends on whether a repayment of the loan is expected to be from the sale or the operation of the collateral. When a repayment is expected from the operation of the collateral, the Company uses the present value of expected cash flows from the operation of the collateral as the fair value. When the repayment of the loan is expected from the sale of the collateral the fair value of the collateral is based on an observable market price or the collateral’s appraised value, less estimated costs to sell. Third-party appraisals used in the individual reserve assessment are conducted at least annually with underlying assumptions that are reviewed by management. Third-party appraisals may be obtained on a more frequent basis if deemed necessary. Internal evaluations of collateral value are conducted quarterly to ensure any further deterioration of the collateral value is recognized on a timely basis. During the individual reserve assessment, management also considers the potential future changes in the value of the collateral over the remainder of the loan’s remaining life. The Company may receive updated appraisals which contradict the preliminary determination of fair value used to establish an individual allowance on a loan. In these instances the individual allowance is adjusted to reflect the Company’s evaluation of the updated appraised fair value. In the event a loss was previously confirmed and the loan was charged down to the estimated fair value based on a previous appraisal, the balance of partially charged-off loans are not subsequently increased, but could be further decreased depending on the direction of the change in fair value. Payments on fully or partially charged-off loans are accounted for under the cost-recovery method. Under this method, all payments received are applied on a cash basis to reduce the entire outstanding principal balance, then to recognize a recovery of all previously charged-off amounts before any interest income may be recognized. Based on the individual reserve assessment, if the Company determines that the fair value of the collateral is less than the amortized cost basis of the loan, an individual allowance will be established measured as the difference between the fair value of the collateral

(less costs to sell) and the amortized cost basis of the loan. Once a loss has been confirmed, the loan is charged-down to its estimated fair value.

Large groups of smaller non-accrual homogeneous loans are not individually evaluated for allowance and include residential permanent and construction mortgages and consumer installment loans. These portfolios are reserved for on a collective basis using historical loss rates of similar loans over the weighted average life of each pool.

Unfunded lending commitments are reviewed to determine if they are considered unconditionally cancellable. The Company establishes reserves for unfunded commitments that do not meet that criteria as a liability in the Condensed Consolidated Statements of Condition. Changes to the liability are recorded through the provision for credit losses in the Condensed Consolidated Statements of Income. The establishment of the reserves for unfunded commitments considers both the likelihood that the funding will occur and an estimate of the expected credit losses over the life of the respective commitments.

Management believes it uses relevant information available to make determinations about the allowance and reserve for unfunded commitments and that it has established the existing reserves in accordance with GAAP. However, the determination of the allowance requires significant judgment, and estimates of expected lifetime losses in the loan portfolio can vary significantly from the amounts actually observed. While management uses available information to recognize expected losses, future additions to the allowance may be necessary based on changes in the loans comprising the portfolio, changes in the current and forecasted economic conditions, changes to the interest rate environment which may directly impact prepayment and curtailment rate assumptions, and changes in the financial condition of borrowers.

Held-to-maturity debt securities

Held-to-maturity debt securities

Debt securities that are purchased with the positive intent and ability to be held until their maturity are classified as held-to-maturity (“HTM”). HTM debt securities are recorded at cost adjusted for amortization of premiums and accretion of discounts. Transfers of debt securities from available-for-sale ("AFS") category to HTM category are made at fair value as of the transfer date. The unrealized gain or loss at the date of transfer continues to be reported in accumulated other comprehensive income and in the carrying amount of the HTM securities. Both amounts are amortized over the remaining life of the security as a yield adjustment in interest income and effectively offset each other.

Leases

Leases

The Company determines if an arrangement is a lease at inception. All of the Company’s leases are currently classified as operating leases and are included in other assets and other liabilities on the Company’s Condensed Consolidated Statements of Condition. Periodic operating lease costs are recorded in occupancy expenses of premises on the Company's Condensed Consolidated Statements of Income.

Right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease arrangements. Operating lease ROU assets and liabilities are recognized at the lease commencement date based on the present value of the expected future lease payments over the remaining lease term. In determining the present value of future lease payments, the Company uses its incremental borrowing rate based on the information available at the lease commencement date. The operating ROU assets are adjusted for any lease payments made at or before the lease commencement date, initial direct costs, any lease incentives received and, for acquired leases, any favorable or unfavorable fair value adjustments. The present value of the lease liability may include the impact of options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options provided in the lease terms. Lease expense is recognized on a straight-line basis over the expected lease term. Lease agreements that include lease and non-lease components, such as common area maintenance charges, are accounted for separately.

Adopted Accounting Pronouncements and Pending Accounting Pronouncements

Adopted Accounting Pronouncements

In March 2022, the FASB issued ASU 2022-02, "Financial Instruments - Credit Losses (Topic 326)", which eliminated the accounting guidance on troubled debt restructurings (“TDR”) and amended the guidance on “vintage disclosures” to require disclosure of current period gross charge-offs by year of origination. The ASU also added enhanced disclosures for creditors with respect to loan refinancing and restructurings for borrowers experiencing financial difficulty. The objective of the disclosures was to provide information about the type and magnitude of modifications and the degree of their success in mitigating potential credit losses. The Company fully adopted this update effective January 1, 2023 on a prospective basis. The adoption of this pronouncement did not have a material impact on the Consolidated Financial Statements.

Pending Accounting Pronouncements

In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848)”. This ASU provided temporary, optional

guidance to ease the potential burden in accounting for, or recognizing the effects of, the transition away from the London Interbank Offered Rate ("LIBOR") or other reference rate expected to be discontinued on financial reporting. The standard was

elective and provided optional expedients and exceptions for applying GAAP to contracts, hedging relationships, or other transactions that reference LIBOR, or another reference rate expected to be discontinued. The amendments in the update were effective for all entities between March 12, 2020 and December 31, 2022. In January 2021, the FASB issued ASU 2021-01, “Reference Rate Reform (Topic 848): Scope”. This ASU refines the scope of Topic 848 and addresses questions about whether Topic 848 can be applied to derivative instruments that do not reference a rate that is expected to be discontinued, but that use an interest rate for margining, discounting or contract price alignment that is expected to be modified as a result of reference rate reform. ASU 2021-01 is effective upon issuance through December 31, 2024, and can be adopted at any time during this period. The Company has not offered LIBOR for any new contracts since 2021. The Company has identified all known LIBOR exposures, created a plan to address the exposures, and continues to communicate with all stakeholders in order to facilitate the transition to an alternative reference rate. The Company adopted ASU 2020-04 on January 1, 2022. The adoption did not have a material impact on the Company’s Consolidated Financial Statements. The Company continues to evaluate the adoption of ASU 2021-01 and does not expect it to have a material impact on the Company's Consolidated Financial Statements.

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INVESTMENTS (Tables)

6 Months Ended

Jun. 30, 2023

Investments, Debt and Equity Securities [Abstract]

Schedule of Amortized Cost and Estimated Fair Values of Investments

The amortized cost and estimated fair values of investments available-for-sale and held-to-maturity at the dates indicated are presented in the following table:

	June 30, 2023								December 31, 2022
(In thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Available-for-sale debt securities:
U.S. treasuries and government agencies	$	101,299	$	—	$	(6,954)	$	94,345	$	100,926	$	—	$	(7,304)	$	93,622
State and municipal	318,815		1		(50,565)		268,251		322,519		4		(56,526)		265,997
Mortgage-backed and asset-backed	868,704		40		(87,652)		781,092		943,398		73		(88,552)		854,919
Total available-for-sale debt securities	$	1,288,818	$	41	$	(145,171)	$	1,143,688	$	1,366,843	$	77	$	(152,382)	$	1,214,538
Held-to-maturity debt securities:
Mortgage-backed and asset-backed	247,814		—		(39,152)		208,662		259,452		—		(39,329)		220,123
Total held-to-maturity debt securities	$	247,814	$	—	$	(39,152)	$	208,662	$	259,452	$	—	$	(39,329)	$	220,123
Total debt securities	$	1,536,632	$	41	$	(184,323)	$	1,352,350	$	1,626,295	$	77	$	(191,711)	$	1,434,661

Schedule of Gross Unrealized Losses and Fair Value by Length of Time in Unrealized Loss Position

Gross unrealized losses and fair value by length of time that the individual available-for-sale debt securities have been in an unrealized loss position at the dates indicated are presented in the following tables:

	June 30, 2023
	Number of Securities	Less Than 12 Months				12 Months or More				Total
(Dollars in thousands)		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
U.S. treasuries and government agencies	10	$	—	$	—	$	94,345	$	6,954	$	94,345	$	6,954
State and municipal	127	17,222		488		249,495		50,077		266,717		50,565
Mortgage-backed and asset-backed	327	158,418		6,042		613,216		81,610		771,634		87,652
Total	464	$	175,640	$	6,530	$	957,056	$	138,641	$	1,132,696	$	145,171

	December 31, 2022
	Number of Securities	Less Than 12 Months				12 Months or More				Total
(Dollars in thousands)		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
U.S. treasuries and government agencies	10	$	53,139	$	3,653	$	40,483	$	3,651	$	93,622	$	7,304
State and municipal	130	200,439		30,803		62,482		25,723		262,921		56,526
Mortgage-backed and asset-backed	324	526,387		44,952		297,216		43,600		823,603		88,552
Total	464	$	779,965	$	79,408	$	400,181	$	72,974	$	1,180,146	$	152,382

Estimated Fair Values of Debt Securities by Contractual Maturity

The estimated fair values and amortized costs of available-for-sale and held-to-maturity debt securities by contractual maturity are provided in the following tables.

	June 30, 2023				December 31, 2022
(In thousands)	Fair Value		Amortized Cost		Fair Value		Amortized Cost
Available-for-sale debt securities
U.S. treasuries and government agencies:
One year or less	$	14,580	$	14,984	$	—	$	—
One to five years	79,765		86,315		93,622		100,926
Five to ten years	—		—		—		—
After ten years	—		—		—		—
State and municipal:
One year or less	6,799		6,842		8,694		8,783
One to five years	53,557		55,926		51,576		53,948
Five to ten years	36,343		43,156		28,806		34,042
After ten years	171,552		212,891		176,921		225,746
Mortgage-backed and asset-backed:
One year or less	4,692		4,744		7,622		7,704
One to five years	47,004		48,742		45,366		46,802
Five to ten years	274,805		305,295		303,697		335,285
After ten years	454,591		509,923		498,234		553,607
Total available-for-sale debt securities	$	1,143,688	$	1,288,818	$	1,214,538	$	1,366,843

	June 30, 2023				December 31, 2022
(In thousands)	Fair Value		Amortized Cost		Fair Value		Amortized Cost
Held-to-maturity debt securities
Mortgage-backed and asset-backed:
One year or less	$	—	$	—	$	—	$	—
One to five years	—		—		—		—
Five to ten years	32,997		36,828		35,304		39,213
After ten years	175,665		210,986		184,819		220,239
Total held-to-maturity debt securities	$	208,662	$	247,814	$	220,123	$	259,452

Summary of Other Investments

Other investments are presented in the following table:

(In thousands)	June 30, 2023		December 31, 2022
Federal Reserve Bank stock, at cost	$	38,961	$	38,873
Federal Home Loan Bank of Atlanta stock, at cost	32,414		29,668
Other	677		677
Total other investments, at cost	$	72,052	$	69,218

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LOANS (Tables)

6 Months Ended

Jun. 30, 2023

Receivables [Abstract]

Loan Portfolio Segment Balances

The loan portfolio segment balances at the dates indicated are presented in the following table:

(In thousands)	June 30, 2023		December 31, 2022
Commercial real estate:
Commercial investor real estate	$	5,131,210	$	5,130,094
Commercial owner-occupied real estate	1,770,135		1,775,037
Commercial AD&C	1,045,742		1,090,028
Commercial business	1,423,614		1,455,885
Total commercial loans	9,370,701		9,451,044
Residential real estate:
Residential mortgage	1,385,743		1,287,933
Residential construction	190,690		224,772
Consumer	422,505		432,957
Total residential and consumer loans	1,998,938		1,945,662
Total loans	$	11,369,639	$	11,396,706

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CREDIT QUALITY ASSESSMENT (Tables)

6 Months Ended

Jun. 30, 2023

Credit Loss [Abstract]

Summary Information on the Allowance for Credit Loss Activity

Summary information on the allowance for credit losses on loans for the period indicated is provided in the following table:

	Six Months Ended June 30,
(In thousands)	2023		2022
Balance at beginning of period	$	136,242	$	109,145
Provision/ (credit) for credit losses - loans (1)	(14,491)		4,681
Loan charge-offs	(2,265)		(762)
Loan recoveries	801		606
Net charge-offs	(1,464)		(156)
Balance at period end	$	120,287	$	113,670

 (1) Excludes the total credit to the provision on unfunded loan commitments for six months ended June 30, 2023 of $2.0 million.

Schedule of Collateral Dependent Loans Individually Evaluated for Credit Loss

The following table provides summary information regarding collateral dependent loans individually evaluated for credit loss at the dates indicated:

(In thousands)	June 30, 2023		December 31, 2022
Collateral dependent loans individually evaluated for credit loss with an allowance	$	48,878	$	9,743
Collateral dependent loans individually evaluated for credit loss without an allowance	14,652		16,454
Total individually evaluated collateral dependent loans	$	63,530	$	26,197
Allowance for credit losses related to loans evaluated individually	$	16,224	$	6,902
Allowance for credit losses related to loans evaluated collectively	104,063		129,340
Total allowance for credit losses - loans	$	120,287	$	136,242

Activity in Allowance for Credit Losses or Loan and Lease Losses by Respective Loan Portfolio Segment

The following tables provide information on the activity in the allowance for credit losses by the respective loan portfolio segment for the period indicated:

	For the Six Months Ended June 30, 2023
	Commercial Real Estate												Residential Real Estate
(Dollars in thousands)	Commercial Investor R/E			Commercial Owner- Occupied R/E			Commercial AD&C			Commercial Business			Residential Mortgage			Residential Construction			Consumer			Total
Balance at beginning of period	$	64,737		$	11,646		$	18,646		$	28,027		$	9,424		$	1,337		$	2,425		$	136,242
Provision/ (credit) for credit losses - loans	(3,669)			(2,469)			(8,446)			123			(207)			(487)			664			(14,491)
Charge-offs	—			—			—			(423)			(160)			—			(1,682)			(2,265)
Recoveries	19			53			—			187			104			—			438			801
Net (charge-offs)/ recoveries	19			53			—			(236)			(56)			—			(1,244)			(1,464)
Balance at end of period	$	61,087		$	9,230		$	10,200		$	27,914		$	9,161		$	850		$	1,845		$	120,287
Total loans	$	5,131,210		$	1,770,135		$	1,045,742		$	1,423,614		$	1,385,743		$	190,690		$	422,505		$	11,369,639
Allowance for credit losses on loans to total loans ratio	1.19		%	0.52		%	0.98		%	1.96		%	0.66		%	0.45		%	0.44		%	1.06		%
Average loans	$	5,141,447		$	1,771,369		$	1,069,927		$	1,443,030		$	1,330,912		$	217,419		$	423,711		$	11,397,815
Annualized net charge-offs/ (recoveries) to average loans	—		%	(0.01)		%	—		%	0.03		%	0.01		%	—		%	0.59		%	0.03		%
Balance of loans individually evaluated for credit loss	$	48,721		$	4,846		$	570		$	9,393		$	—		$	—		$	—		$	63,530
Allowance related to loans evaluated individually	$	7,908		$	1,226		$	102		$	6,988		$	—		$	—		$	—		$	16,224
Individual allowance to loans evaluated individually ratio	16.23		%	25.30		%	17.89		%	74.40		%	—		%	—		%	—		%	25.54		%
Contractual balance of individually evaluated loans	$	48,886		$	5,675		$	581		$	10,545		$	—		$	—		$	—		$	65,687
Balance of loans collectively evaluated for credit loss	$	5,082,489		$	1,765,289		$	1,045,172		$	1,414,221		$	1,385,743		$	190,690		$	422,505		$	11,306,109
Allowance related to loans evaluated collectively	$	53,179		$	8,004		$	10,098		$	20,926		$	9,161		$	850		$	1,845		$	104,063
Collective allowance to loans evaluated collectively ratio	1.05		%	0.45		%	0.97		%	1.48		%	0.66		%	0.45		%	0.44		%	0.92		%

	For the Year Ended December 31, 2022
	Commercial Real Estate												Residential Real Estate
(Dollars in thousands)	Commercial Investor R/E			Commercial Owner- Occupied R/E			Commercial AD&C			Commercial Business			Residential Mortgage			Residential Construction			Consumer			Total
Balance at beginning of period	$	45,289		$	11,687		$	20,322		$	23,170		$	5,384		$	1,048		$	2,245		$	109,145
Provision for credit losses - loans	19,128			(90)			(1,676)			4,774			4,093			281			170			26,680
Charge-offs	—			—			—			(716)			(155)			—			(234)			(1,105)
Recoveries	320			49			—			799			102			8			244			1,522
Net (charge-offs)/ recoveries	320			49			—			83			(53)			8			10			417
Balance at end of period	$	64,737		$	11,646		$	18,646		$	28,027		$	9,424		$	1,337		$	2,425		$	136,242
Total loans	$	5,130,094		$	1,775,037		$	1,090,028		$	1,455,885		$	1,287,933		$	224,772		$	432,957		$	11,396,706
Allowance for credit losses on loans to total loans ratio	1.26		%	0.66		%	1.71		%	1.93		%	0.73		%	0.59		%	0.56		%	1.20		%
Average loans	$	4,681,607		$	1,730,293		$	1,112,936		$	1,351,906		$	1,117,053		$	221,341		$	423,746		$	10,638,882
Net charge-offs/ (recoveries) to average loans	(0.01)		%	—		%	—		%	(0.01)		%	—		%	—		%	—		%	—		%
Balance of loans individually evaluated for credit loss	$	9,943		$	6,155		$	—		$	8,274		$	1,487		$	—		$	338		$	26,197
Allowance related to loans evaluated individually	$	134		$	1,261		$	—		$	5,507		$	—		$	—		$	—		$	6,902
Individual allowance to loans evaluated individually ratio	1.35		%	20.49		%	—		%	66.56		%	—		%	—		%	—		%	26.35		%
Contractual balance of individually evaluated loans	$	10,882		$	6,849		$	—		$	9,893		$	1,487		$	—		$	364		$	29,475
Balance of loans collectively evaluated for credit loss	$	5,120,151		$	1,768,882		$	1,090,028		$	1,447,611		$	1,286,446		$	224,772		$	432,619		$	11,370,509
Allowance related to loans evaluated collectively	$	64,603		$	10,385		$	18,646		$	22,520		$	9,424		$	1,337		$	2,425		$	129,340
Collective allowance to loans evaluated collectively ratio	1.26		%	0.59		%	1.71		%	1.56		%	0.73		%	0.59		%	0.56		%	1.14		%

Schedule of Information on the Credit Quality of Loan Portfolio

The following section provides information on the credit quality of the loan portfolio for the periods indicated below:

	For the Six Months Ended June 30, 2023
	Commercial Real Estate								Residential Real Estate
(In thousands)	Commercial Investor R/E		Commercial Owner- Occupied R/E		Commercial AD&C		Commercial Business		Residential Mortgage		Residential Construction		Consumer		Total
Analysis of non-accrual loan activity:
Balance at beginning of period	$	9,943	$	5,019	$	—	$	7,322	$	7,439	$	—	$	5,059	$	34,782
Loans placed on non-accrual	19,622		—		569		4,362		3,540		—		897		28,990
Non-accrual balances transferred to OREO	—		—		—		—		—		—		—		—
Non-accrual balances charged-off	—		—		—		(424)		(160)		—		(1,591)		(2,175)
Net payments or draws	(9,184)		(173)		—		(1,354)		(309)		—		(846)		(11,866)
Non-accrual loans brought current	—		—		—		(513)		(357)		—		(123)		(993)
Balance at end of period	$	20,381	$	4,846	$	569	$	9,393	$	10,153	$	—	$	3,396	$	48,738

	For the Year Ended December 31, 2022
	Commercial Real Estate								Residential Real Estate
(In thousands)	Commercial Investor R/E		Commercial Owner- Occupied R/E		Commercial AD&C		Commercial Business		Residential Mortgage		Residential Construction		Consumer		Total
Analysis of non-accrual loan activity:
Balance at beginning of period	$	12,489	$	9,306	$	650	$	8,420	$	8,441	$	55	$	6,725	$	46,086
Loans placed on non-accrual	4,761		2,370		—		1,591		2,593		—		815		12,130
Non-accrual balances transferred to OREO	—		—		—		—		—		—		—		—
Non-accrual balances charged-off	—		—		—		(677)		(151)		—		(32)		(860)
Net payments or draws	(7,307)		(4,366)		(650)		(2,012)		(2,615)		(55)		(2,060)		(19,065)
Non-accrual loans brought current	—		(2,291)		—		—		(829)		—		(389)		(3,509)
Balance at end of period	$	9,943	$	5,019	$	—	$	7,322	$	7,439	$	—	$	5,059	$	34,782

Credit Quality of Loan Portfolio by Segment

	June 30, 2023
	Commercial Real Estate								Residential Real Estate
(In thousands)	Commercial Investor R/E		Commercial Owner- Occupied R/E		Commercial AD&C		Commercial Business		Residential Mortgage		Residential Construction		Consumer		Total
Performing loans:
Current	$	5,108,614	$	1,763,223	$	1,044,320	$	1,413,058	$	1,366,644	$	190,690	$	416,799	$	11,303,348
30-59 days	2,215		2,066		—		747		5,464		—		1,849		12,341
60-89 days	—		—		853		387		2,790		—		461		4,491
Total performing loans	5,110,829		1,765,289		1,045,173		1,414,192		1,374,898		190,690		419,109		11,320,180
Non-performing loans:
Non-accrual loans	20,381		4,846		569		9,393		10,153		—		3,396		48,738
Loans greater than 90 days past due	—		—		—		29		692		—		—		721
Restructured loans (1)	—		—		—		—		—		—		—		—
Total non-performing loans	20,381		4,846		569		9,422		10,845		—		3,396		49,459
Total loans	$	5,131,210	$	1,770,135	$	1,045,742	$	1,423,614	$	1,385,743	$	190,690	$	422,505	$	11,369,639

(1) Effective January 1, 2023, the Company adopted ASU 2022-02, which eliminated the accounting and recognition of troubled debt restructurings ("TDRs").

	December 31, 2022
	Commercial Real Estate								Residential Real Estate
(In thousands)	Commercial Investor R/E		Commercial Owner- Occupied R/E		Commercial AD&C		Commercial Business		Residential Mortgage		Residential Construction		Consumer		Total
Performing loans:
Current	$	5,104,204	$	1,767,875	$	1,090,028	$	1,443,012	$	1,261,878	$	222,144	$	422,989	$	11,312,130
30-59 days	9,735		1,007		—		3,556		11,307		2,628		4,343		32,576
60-89 days	6,212		—		—		41		5,822		—		566		12,641
Total performing loans	5,120,151		1,768,882		1,090,028		1,446,609		1,279,007		224,772		427,898		11,357,347
Non-performing loans:
Non-accrual loans	9,943		5,019		—		7,322		7,439		—		5,059		34,782
Loans greater than 90 days past due	—		—		—		1,002		—		—		—		1,002
Restructured loans	—		1,136		—		952		1,487		—		—		3,575
Total non-performing loans	9,943		6,155		—		9,276		8,926		—		5,059		39,359
Total loans	$	5,130,094	$	1,775,037	$	1,090,028	$	1,455,885	$	1,287,933	$	224,772	$	432,957	$	11,396,706

Table of Average Principal Balance of the Total Non-Accrual Loans and Contractual Interest Due

The following tables present average principal balance of total non-accrual loans and contractual interest due on non-accrual loans for the periods indicated below:

	For the Six Months Ended June 30, 2023
	Commercial Real Estate								Residential Real Estate
(In thousands)	Commercial Investor R/E		Commercial Owner- Occupied R/E		Commercial AD&C		Commercial Business		Residential Mortgage		Residential Construction		Consumer		Total
Average non-accrual loans for the period	$	15,258	$	4,938	$	190	$	8,719	$	8,842	$	—	$	4,452	$	42,399
Contractual interest income due on non- accrual loans during the period	$	559	$	146	$	24	$	350	$	232	$	—	$	243	$	1,554

	For the Year Ended December 31, 2022
	Commercial Real Estate								Residential Real Estate
(In thousands)	Commercial Investor R/E		Commercial Owner- Occupied R/E		Commercial AD&C		Commercial Business		Residential Mortgage		Residential Construction		Consumer		Total
Average non-accrual loans for the period	$	11,892	$	7,314	$	617	$	7,768	$	7,769	$	21	$	5,811	$	41,192
Contractual interest income due on non- accrual loans during the period	$	713	$	106	$	30	$	491	$	319	$	1	$	349	$	2,009

Information About Credit Quality Indicator by the Year Of Origination

The following table provides information about credit quality indicators by the year of origination as of June 30, 2023:

	June 30, 2023
	Term Loans by Origination Year												Revolving
(In thousands)	2023		2022		2021		2020		2019		Prior		Loans		Total
Commercial Investor R/E:
Pass	$	221,130	$	1,401,988	$	1,210,529	$	689,275	$	552,876	$	958,510	$	24,855	$	5,059,163
Special Mention	6,297		10,298		30,536		—		93		2,880		—		50,104
Substandard	14,799		544		3,663		—		1,377		1,560		—		21,943
Doubtful	—		—		—		—		—		—		—		—
Total	$	242,226	$	1,412,830	$	1,244,728	$	689,275	$	554,346	$	962,950	$	24,855	$	5,131,210
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial Owner-Occupied R/E:
Pass	$	87,454	$	366,576	$	325,147	$	238,899	$	246,174	$	474,408	$	2,184	$	1,740,842
Special Mention	731		739		—		889		323		7,538		—		10,220
Substandard	3,296		3,753		815		351		5,988		4,870		—		19,073
Doubtful	—		—		—		—		—		—		—		—
Total	$	91,481	$	371,068	$	325,962	$	240,139	$	252,485	$	486,816	$	2,184	$	1,770,135
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial AD&C:
Pass	$	189,426	$	318,888	$	284,974	$	78,362	$	1,867	$	15,079	$	154,566	$	1,043,162
Special Mention	1,661		—		—		—		—		—		—		1,661
Substandard	350		569		—		—		—		—		—		919
Doubtful	—		—		—		—		—		—		—		—
Total	$	191,437	$	319,457	$	284,974	$	78,362	$	1,867	$	15,079	$	154,566	$	1,045,742
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial Business:
Pass	$	81,897	$	342,575	$	212,680	$	108,084	$	75,222	$	129,998	$	441,542	$	1,391,998
Special Mention	—		95		204		942		2,172		338		13,398		17,149
Substandard	1,255		2,231		1,766		994		2,581		1,818		3,822		14,467
Doubtful	—		—		—		—		—		—		—		—
Total	$	83,152	$	344,901	$	214,650	$	110,020	$	79,975	$	132,154	$	458,762	$	1,423,614
Current period gross charge-offs	$	—	$	—	$	324	$	—	$	—	$	99			$	423
Residential Mortgage:
Beacon score:
660-850	$	18,644	$	377,467	$	387,642	$	168,643	$	41,092	$	290,758	$	—	$	1,284,246
600-659	—		8,016		13,725		4,075		3,858		29,123		—		58,797
540-599	304		2,915		3,291		523		1,511		8,894		—		17,438
less than 540	—		363		3,006		3,448		3,008		15,437		—		25,262
Total	$	18,948	$	388,761	$	407,664	$	176,689	$	49,469	$	344,212	$	—	$	1,385,743
Current period gross charge-offs	$	—	$	—	$	43	$	—	$	10	$	107	$	—	$	160
Residential Construction:
Beacon score:
660-850	$	9,189	$	135,471	$	36,186	$	5,837	$	150	$	1,244	$	—	$	188,077
600-659	—		973		739		—		—		—		—		1,712
540-599	—		—		401		—		—		—		—		401
less than 540	500		—		—		—		—		—		—		500
Total	$	9,689	$	136,444	$	37,326	$	5,837	$	150	$	1,244	$	—	$	190,690
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Consumer:
Beacon score:
660-850	$	4,743	$	6,164	$	2,515	$	764	$	2,048	$	24,430	$	344,560	$	385,224
600-659	325		543		21		163		113		5,299		12,686		19,150
540-599	309		79		83		38		127		2,293		4,456		7,385
less than 540	224		178		248		291		486		2,750		6,569		10,746
Total	$	5,601	$	6,964	$	2,867	$	1,256	$	2,774	$	34,772	$	368,271	$	422,505
Current period gross charge-offs	$	—	$	1	$	—	$	—	$	—	$	1,594	$	87	$	1,682
Total loans	$	642,534	$	2,980,425	$	2,518,171	$	1,301,578	$	941,066	$	1,977,227	$	1,008,638	$	11,369,639

 The following table provides information about credit quality indicators by the year of origination as of December 31, 2022:

	December 31, 2022
	Term Loans by Origination Year												Revolving
(In thousands)	2022		2021		2020		2019		2018		Prior		Loans		Total
Commercial Investor R/E:
Pass	$	1,510,446	$	1,197,504	$	694,756	$	567,247	$	335,103	$	742,405	$	15,242	$	5,062,703
Special Mention	32,661		17,146		468		94		473		4,814		—		55,656
Substandard	557		1,896		—		—		8,239		1,043		—		11,735
Doubtful	—		—		—		—		—		—		—		—
Total	$	1,543,664	$	1,216,546	$	695,224	$	567,341	$	343,815	$	748,262	$	15,242	$	5,130,094
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial Owner-Occupied R/E:
Pass	$	391,340	$	328,657	$	240,738	$	260,114	$	140,841	$	381,386	$	1,167	$	1,744,243
Special Mention	4,567		—		1,301		1,740		2,066		7,323		—		16,997
Substandard	3,219		160		133		6,110		2,010		2,165		—		13,797
Doubtful	—		—		—		—		—		—		—		—
Total	$	399,126	$	328,817	$	242,172	$	267,964	$	144,917	$	390,874	$	1,167	$	1,775,037
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial AD&C:
Pass	$	366,096	$	439,468	$	113,713	$	34,340	$	14,816	$	—	$	119,727	$	1,088,160
Special Mention	1,073		—		—		—		—		—		795		1,868
Substandard	—		—		—		—		—		—		—		—
Doubtful	—		—		—		—		—		—		—		—
Total	$	367,169	$	439,468	$	113,713	$	34,340	$	14,816	$	—	$	120,522	$	1,090,028
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial Business:
Pass	$	330,598	$	223,245	$	95,787	$	105,922	$	77,891	$	78,009	$	508,839	$	1,420,291
Special Mention	127		458		1,107		7,787		498		322		13,225		23,524
Substandard	2,902		1,611		1,094		2,030		449		2,121		1,863		12,070
Doubtful	—		—		—		—		—		—		—		—
Total	$	333,627	$	225,314	$	97,988	$	115,739	$	78,838	$	80,452	$	523,927	$	1,455,885
Current period gross charge-offs	$	174	$	—	$	—	$	—	$	138	$	404	$	—	$	716
Residential Mortgage:
Beacon score:
660-850	$	330,109	$	344,062	$	171,330	$	41,883	$	51,651	$	262,570	$	—	$	1,201,605
600-659	4,571		6,196		1,173		3,925		6,041		24,006		—		45,912
540-599	369		4,013		1,439		1,256		1,931		6,945		—		15,953
less than 540	1,860		3,036		2,892		3,822		2,347		10,506		—		24,463
Total	$	336,909	$	357,307	$	176,834	$	50,886	$	61,970	$	304,027	$	—	$	1,287,933
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	24	$	131	$	—	$	155
Residential Construction:
Beacon score:
660-850	$	131,259	$	75,844	$	12,133	$	150	$	1,432	$	1,245	$	—	$	222,063
600-659	908		373		—		—		—		—		—		1,281
540-599	609		—		—		—		—		—		—		609
less than 540	—		819		—		—		—		—		—		819
Total	$	132,776	$	77,036	$	12,133	$	150	$	1,432	$	1,245	$	—	$	224,772
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Consumer:
Beacon score:
660-850	$	6,689	$	2,346	$	1,201	$	2,147	$	2,047	$	23,170	$	359,468	$	397,068
600-659	658		467		59		198		664		5,459		11,269		18,774
540-599	123		56		—		465		316		2,802		3,824		7,586
less than 540	156		57		40		133		209		2,918		6,016		9,529
Total	$	7,626	$	2,926	$	1,300	$	2,943	$	3,236	$	34,349	$	380,577	$	432,957
Current period gross charge-offs	$	—	$	5	$	15	$	—	$	13	$	20	$	181	$	234
Total loans	$	3,120,897	$	2,647,414	$	1,339,364	$	1,039,363	$	649,024	$	1,559,209	$	1,041,435	$	11,396,706

Schedule of Loans Modified

The following table presents the amounts at the end of the reporting period of the loans modified during the period to borrowers experiencing financial difficulty, disaggregated by the loan portfolio segment and type of modification granted:

	For the six months ended June 30, 2023
	Interest rate reduction				Term extension				Total
(in thousands)	Amount		% of total loan segment		Amount		% of total loan segment		Amount		% of total loan segment
Commercial Investor R/E	$	28,340	0.6	%	$	553	—	%	$	28,893	0.6	%
Commercial Owner-Occupied R/E	—		—	%	2,000		0.1	%	2,000		0.1	%
Commercial AD&C	—		—	%	350		—	%	350		—	%
Commercial Business	—		—	%	950		0.1	%	950		0.1	%
All Other loans	—		—	%	—		—	%	—		—	%
Total	$	28,340	0.2	%	$	3,853	—	%	$	32,193	0.3	%

The following table describes the financial effect of the modifications granted to borrowers experiencing financial difficulty during the six months ended June 30, 2023:

	Interest rate reduction	Term extension
Commercial Investor R/E	Reduced weighted average contractual interest rate from 8% to 5%	Added a weighted average of 5 months to the life of loans
Commercial Owner-Occupied R/E	—	Added a weighted average of 8 months to the life of loans
Commercial AD&C	—	Added a weighted average of 9 months to the life of loans
Commercial Business	—	Added a weighted average of 8 months to the life of loans

The following table presents the performance of loans that have been modified during the six months ended June 30, 2023:

	For the six months ended June 30, 2023
(in thousands)	Current		30-89 days past due		90+ days past due		Non-accrual		Total
Commercial Investor R/E	$	28,680	$	213	$	—	$	—	$	28,893
Commercial Owner-Occupied R/E	2,000		—		—		—		2,000
Commercial AD&C	350		—		—		—		350
Commercial Business	950		—		—		—		950
All Other loans	—		—		—		—		—
Total	$	31,980	$	213	$	—	$	—	$	32,193

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GOODWILL AND OTHER INTANGIBLE ASSETS (Tables)

6 Months Ended

Jun. 30, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Amount of Goodwill by Reporting Units

The amount of goodwill by reporting units is presented in the following table:

(In thousands)	Community Banking		Investment Management		Total
Balances at December 31, 2022	$	331,689	$	31,747	$	363,436
No activity	—		—		—
Balances at June 30, 2023	$	331,689	$	31,747	$	363,436

Gross Carrying Amounts and Accumulated Amortization of Intangible Assets and Goodwill

The gross carrying amounts and accumulated amortization of intangible assets and goodwill are presented at the dates indicated in the following table:

	June 30, 2023						Weighted Average Remaining Life	December 31, 2022						Weighted Average Remaining Life
(Dollars in thousands)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount			Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Amortizing intangible assets:
Core deposit intangibles	$	29,038	$	(18,486)	$	10,552	6.0 years	$	29,038	$	(16,694)	$	12,344	6.5 years
Other identifiable intangibles	13,906		(7,178)		6,728		8.2 years	13,906		(6,395)		7,511		8.8 years
Total amortizing intangible assets	$	42,944	$	(25,664)	$	17,280		$	42,944	$	(23,089)	$	19,855
Goodwill	$	363,436			$	363,436		$	363,436			$	363,436

Estimated Future Amortization Expense for Amortizing Intangibles

The following table presents the estimated future amortization expense for amortizing intangible assets within the years ending December 31:

(In thousands)	Amount
Remaining 2023	$	2,465
2024	4,291
2025	3,530
2026	2,702
2027	1,945
Thereafter	2,347
Total amortizing intangible assets	$	17,280

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DEPOSITS (Tables)

6 Months Ended

Jun. 30, 2023

Deposits [Abstract]

Composition of Deposits

The following table presents the composition of deposits at the dates indicated:

(In thousands)	June 30, 2023		December 31, 2022
Noninterest-bearing deposits	$	3,079,896	$	3,673,300
Interest-bearing deposits:
Demand	1,413,027		1,435,454
Money market savings	2,918,253		3,213,045
Regular savings	731,985		513,360
Time deposits of less than $250,000	2,293,858		1,644,645
Time deposits of $250,000 or more	521,903		473,617
Total interest-bearing deposits	7,879,026		7,280,121
Total deposits	$	10,958,922	$	10,953,421

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BORROWINGS (Tables)

6 Months Ended

Jun. 30, 2023

Debt Disclosure [Abstract]

Schedule of Subordinated Debt

The following table provides information on subordinated debt as of the date indicated:

(In thousands)	June 30, 2023		December 31, 2022
Fixed to floating rate subordinated debt, 3.875%	$	200,000	$	200,000
Fixed to floating rate subordinated debt, 4.25%	175,000		175,000
Total subordinated debt	375,000		375,000
Less: Debt issuance costs	(4,496)		(4,795)
Long-term borrowings	$	370,504	$	370,205

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SHARE BASED COMPENSATION (Tables)

6 Months Ended

Jun. 30, 2023

Share-Based Payment Arrangement [Abstract]

Summary of Activity for Company's Restricted Stock

A summary of the activity for the Company’s restricted stock, restricted stock units and performance share units for the period indicated is presented in the following table:

	Number of Common Shares/Units	Weighted Average Grant-Date Fair Value
Non-vested at January 1, 2023	389,475	$	37.44
Granted	276,252	$	27.06
Vested	(201,244)	$	33.40
Forfeited/ cancelled	(6,134)	$	33.97
Non-vested at June 30, 2023	458,349	$	32.99

Summary of Share Option Activity

A summary of share option activity for the period indicated is reflected in the following table:

	Number of Common Shares	Weighted Average Exercise Share Price		Weighted Average Contractual Remaining Life (Years)	Aggregate Intrinsic Value (in thousands)
Balance at January 1, 2023	144,047	$	16.61	1.6 years	$	2,633
Granted	—	$	—
Exercised	(40,921)	$	12.65		$	474
Forfeited	—	$	—
Expired	(3,338)	$	27.46
Balance at June 30, 2023	99,788	$	17.87	1.4 years	$	804
Exercisable at June 30, 2023	99,788	$	17.87	1.4 years	$	804

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PENSION PLAN (Tables)

6 Months Ended

Jun. 30, 2023

Retirement Benefits [Abstract]

Net Periodic Benefit Cost

The components of net periodic benefit cost for the periods indicated are presented in the following table:

	Three Months Ended June 30,				Six Months Ended June 30,
(In thousands)	2023		2022		2023		2022
Interest cost on projected benefit obligation	$	437	$	326	$	875	$	651
Expected return on plan assets	(373)		(352)		(746)		(705)
Recognized net actuarial loss	226		195		451		391
Net periodic benefit cost	$	290	$	169	$	580	$	337

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NET INCOME PER COMMON SHARE (Tables)

6 Months Ended

Jun. 30, 2023

Earnings Per Share [Abstract]

Calculation of Net Income Per Common Share

The calculation of net income per common share for the periods indicated is presented in the following table:

	Three Months Ended June 30,				Six Months Ended June 30,
(Dollars and amounts in thousands, except per share data)	2023		2022		2023		2022
Net income	$	24,745	$	54,800	$	75,998	$	98,735
Distributed and undistributed earnings allocated to participating securities	(33)		(194)		(177)		(476)
Net income attributable to common shareholders	$	24,712	$	54,606	$	75,821	$	98,259
Total weighted average outstanding shares	44,894		45,184		44,860		45,303
Less: Weighted average participating securities	(61)		(160)		(104)		(221)
Basic weighted average common shares	44,833		45,024		44,756		45,082
Dilutive weighted average common stock equivalents	56		87		121		140
Diluted weighted average common shares	44,889		45,111		44,877		45,222
Basic net income per common share	$	0.55	$	1.21	$	1.69	$	2.18
Diluted net income per common share	$	0.55	$	1.21	$	1.69	$	2.17
Anti-dilutive shares	93		—		30		—

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ACCUMULATED OTHER COMPREHENSIVE LOSS (Tables)

6 Months Ended

Jun. 30, 2023

Equity [Abstract]

Activity in Net Accumulated Other Comprehensive Income (Loss) and the Components of the Activity

The following table presents the activity in net accumulated other comprehensive income/ (loss) and the components of the activity for the periods indicated:

(In thousands)	Unrealized Gains/(Losses) on Debt Securities Available-for-Sale		Defined Benefit Pension Plan		Unrealized Losses on Debt Securities Transferred from Available-for-Sale to Held-to-Maturity		Total
Balance at January 1, 2023	$	(113,513)	$	(8,002)	$	(10,436)	$	(131,951)
Other comprehensive loss before reclassification from accumulated other comprehensive loss, net of tax	5,347		—		—		5,347
Reclassifications from accumulated other comprehensive loss to earnings, net of tax	—		336		643		979
Current period change in other comprehensive loss, net of tax	5,347		336		643		6,326
Balance at June 30, 2023	$	(108,166)	$	(7,666)	$	(9,793)	$	(125,625)

(In thousands)	Unrealized Gains/ (Losses) on Debt Securities Available-for-Sale		Defined Benefit Pension Plan		Unrealized Losses on Debt Securities Transferred from Available-for-Sale to Held-to-Maturity		Total
Balance at January 1, 2022	$	(336)	$	(8,203)	$	—	$	(8,539)
Other comprehensive income before reclassification, net of tax	(77,922)		—		(12,083)		(90,005)
Reclassifications from accumulated other comprehensive income, net of tax	(34)		291		834		1,091
Current period change in other comprehensive income, net of tax	(77,956)		291		(11,249)		(88,914)
Balance at June 30, 2022	$	(78,292)	$	(7,912)	$	(11,249)	$	(97,453)

Schedule of Reclassification Adjustments Out of Accumulated Other Comprehensive Income (Loss)

The following table provides the information on the reclassification adjustments out of accumulated other comprehensive income/ (loss) for the periods indicated:

	Six Months Ended June 30,
(In thousands)	2023		2022
Unrealized gains on available-for-sale debt securities:
Affected line item in the Statements of Income:
Investment securities gains	$	—	$	46
Income before taxes	—		46
Tax expense	—		(12)
Net income	$	—	$	34
Amortization of unrealized losses on debt securities transferred from available-for-sale to held-to-maturity:
Affected line item in the Statements of Income:
Interest and dividends on investment securities (1)	$	(863)	$	(1,122)
Income before taxes	(863)		(1,122)
Tax benefit	220		288
Net loss	$	(643)	$	(834)
Amortization of defined benefit pension plan items:
Affected line item in the Statements of Income:
Recognized actuarial loss (2)	$	(451)	$	(391)
Income before taxes	(451)		(391)
Tax benefit	115		100
Net loss	$	(336)	$	(291)

(1)Amortization of unrealized losses on held-to-maturity debt securities is fully offset by accretion of a discount on held-to-maturity debt securities with no overall impact on net income and yield.

(2)This amount is included in the computation of net periodic benefit cost. See Note 10 for additional information on the pension plan.

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LEASES (Tables)

6 Months Ended

Jun. 30, 2023

Leases [Abstract]

Summary of Leases

The following table provides information regarding the Company's leases as of the dates indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Components of lease expense:
Operating lease cost (resulting from lease payments)	$	2,712	$	2,738	$	5,427	$	5,504
Supplemental cash flow information related to leases:
Operating cash flows from operating leases	$	2,861	$	2,893	$	5,749	$	5,832
ROU assets obtained in the exchange for lease liabilities due to:
New leases	$	—	$	—	$	703	$	—
Acquisitions	$	—	$	—	$	—	$	—
					June 30, 2023		December 31, 2022
Supplemental balance sheet information related to leases:
Operating lease ROU assets					$	50,397	$	48,910
Operating lease liabilities					$	58,568	$	57,402
Other information related to leases:
Weighted average remaining lease term of operating leases					8.3 years		8.6 years
Weighted average discount rate of operating leases					3.22%		3.02%

Maturities of Operating Lease Liabilities

At June 30, 2023, the maturities of the Company’s operating lease liabilities were as follows:

 

(In thousands)	Amount
Maturity:
Remaining 2023	$	5,740
2024	10,751
2025	9,068
2026	8,320
2027	6,922
Thereafter	26,824
Total undiscounted lease payments	67,625
Less: Present value discount	(9,057)
Lease liability	$	58,568

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FAIR VALUE (Tables)

6 Months Ended

Jun. 30, 2023

Fair Value Disclosures [Abstract]

Financial Assets and Liabilities at Dates Indicated that were Accounted for at Fair Value

The following tables set forth the Company’s financial assets and liabilities at the dates indicated that were accounted for or disclosed at fair value. Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement:

	June 30, 2023
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
(In thousands)	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Residential mortgage loans held for sale (1)	$	—	$	21,476	$	—	$	21,476
Available-for-sale debt securities:
U.S. treasuries and government agencies	—		94,345		—		94,345
State and municipal	—		268,251		—		268,251
Mortgage-backed and asset-backed	—		781,092		—		781,092
Total available-for-sale debt securities	—		1,143,688		—		1,143,688
Interest rate swap agreements	—		18,286		—		18,286
Total assets	$	—	$	1,183,450	$	—	$	1,183,450
Liabilities:
Interest rate swap agreements	$	—	$	(18,286)	$	—	$	(18,286)
Total liabilities	$	—	$	(18,286)	$	—	$	(18,286)

 (1) The outstanding principal balance for residential loans held for sale as of June 30, 2023 was $21.7 million.

	December 31, 2022
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
(In thousands)	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Residential mortgage loans held for sale (1)	$	—	$	11,706	$	—	$	11,706
Investments available-for-sale:
U.S. treasuries and government agencies	—		93,622		—		93,622
State and municipal	—		265,997		—		265,997
Mortgage-backed and asset-backed	—		854,919		—		854,919
Total investments available-for-sale	—		1,214,538		—		1,214,538
Interest rate swap agreements	—		18,596		—		18,596
Total assets	$	—	$	1,244,840	$	—	$	1,244,840
Liabilities:
Interest rate swap agreements	$	—	$	(18,596)	$	—	$	(18,596)
Total liabilities	$	—	$	(18,596)	$	—	$	(18,596)

 (1) The outstanding principal balance for residential loans held for sale as of December 31, 2022 was $11.3 million.

Assets Measured at Fair Value on Nonrecurring Basis

The following tables set forth the Company’s financial assets subject to fair value adjustments on a nonrecurring basis at the date indicated that are valued at the lower of cost or market. Assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement:

	June 30, 2023
(In thousands)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total		Total Losses
Loans	$	—	$	—	$	—	$	—	$	—
Other real estate owned	—		—		611		611		(104)
Total	$	—	$	—	$	611	$	611	$	(104)

	December 31, 2022
(In thousands)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total		Total Losses
Loans (1)	$	—	$	—	$	190	$	190	$	(384)
Other real estate owned	—		—		645		645		(105)
Total	$	—	$	—	$	835	$	835	$	(489)

(1) Amounts represent the fair value of collateral for collateral dependent non-accrual loans allocated to the allowance for credit losses. Fair values are determined using actual market prices (Level 2), independent third-party valuations and borrower records, discounted as appropriate (Level 3).

Carrying Amounts and Fair Values of Company's Financial Instruments

The carrying amounts and fair values of the Company’s financial instruments at the dates indicated are presented in the following tables:

					Fair Value Measurements
	June 30, 2023				Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
(In thousands)	Carrying Amount		Estimated Fair Value
Financial assets:
Cash and cash equivalents	$	430,127	$	430,127	$	430,127	$	—	$	—
Residential mortgage loans held for sale	21,476		21,476		—		21,476		—
Available-for-sale debt securities	1,143,688		1,143,688		—		1,143,688		—
Held-to-maturity debt securities	247,814		208,662		—		208,662		—
Other investments	72,052		72,052		—		72,052		—
Loans, net of allowance	11,249,352		10,467,917		—		—		10,467,917
Interest rate swap agreements	18,286		18,286		—		18,286		—
Accrued interest receivable	42,388		42,388		42,388		—		—
Bank owned life insurance	156,874		156,874		—		156,874		—
Financial liabilities:
Time deposits	$	2,815,761	$	2,786,157	$	—	$	2,786,157	$	—
Other deposits	8,143,161		8,143,161		8,143,161		—		—
Securities sold under retail repurchase agreements and
federal funds purchased	374,510		374,510		—		374,510		—
Advances from FHLB	600,000		591,850		—		591,850		—
Subordinated debt	370,504		336,107		—		—		336,107
Interest rate swap agreements	18,286		18,286		—		18,286		—
Accrued interest payable	24,436		24,436		24,436		—		—

					Fair Value Measurements
	December 31, 2022				Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
(In thousands)	Carrying Amount		Estimated Fair Value
Financial assets:
Cash and cash equivalents	$	192,232	$	192,232	$	192,232	$	—	$	—
Residential mortgage loans held for sale	11,706		11,706		—		11,706		—
Investments available-for-sale	1,214,538		1,214,538		—		1,214,538		—
Held-to-maturity debt securities	259,452		220,123		—		220,123		—
Other investments	69,218		69,218		—		69,218		—
Loans, net of allowance	11,260,464		11,020,992		—		—		11,020,992
Interest rate swap agreements	18,596		18,596		—		18,596		—
Accrued interest receivable	41,172		41,172		41,172		—		—
Bank owned life insurance	153,016		153,016		—		153,016		—
Financial liabilities:
Time deposits	$	2,118,262	$	2,082,319	$	—	$	2,082,319	$	—
Other deposits	8,835,159		8,835,159		8,835,159		—		—
Securities sold under retail repurchase agreements and
federal funds purchased	321,967		321,967		—		321,967		—
Advances from FHLB	550,000		549,530		—		549,530		—
Subordinated debt	370,205		332,470		—		—		332,470
Interest rate swap agreements	18,596		18,596		—		18,596		—
Accrued interest payable	10,867		10,867		10,867		—		—

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INVESTMENTS - Narrative (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Fair Value, Separate Account Investment [Line Items]
Book value of debt securities pledged as collateral	$ 1,536,632	$ 1,626,295
Asset pledged as collateral | Deposits
Fair Value, Separate Account Investment [Line Items]
Book value of debt securities pledged as collateral	776,800	$ 533,900
Government National Mortgage Association Certificates and Obligations Federal National Mortgage Association Certificates and Obligations and Federal Home Loan Mortgage Corporation Certificates and Obligations | Collateralized mortgage obligations
Fair Value, Separate Account Investment [Line Items]
Mortgage-backed securities	466,700
Government National Mortgage Association Certificates and Obligations Federal National Mortgage Association Certificates and Obligations and Federal Home Loan Mortgage Corporation Certificates and Obligations | Collateralized mortgage backed securities
Fair Value, Separate Account Investment [Line Items]
Mortgage-backed securities	611,300
Government National Mortgage Association Certificates and Obligations Federal National Mortgage Association Certificates and Obligations and Federal Home Loan Mortgage Corporation Certificates and Obligations | SBA asset backed securities
Fair Value, Separate Account Investment [Line Items]
Mortgage-backed securities	$ 38,500

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INVESTMENTS - Amortized Cost and Estimated Fair Values of Investments (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Available-for-sale debt securities:
Total available-for-sale debt securities	$ 1,288,818	$ 1,366,843
Gross Unrealized Gains	41	77
Gross Unrealized Losses	(145,171)	(152,382)
Investments available-for-sale	1,143,688	1,214,538
Held-to-maturity debt securities:
Total held-to-maturity debt securities	247,814	259,452
Gross Unrealized Gains	0	0
Gross Unrealized Losses	(39,152)	(39,329)
Total held-to-maturity debt securities	208,662	220,123
Total debt securities
Amortized Cost	1,536,632	1,626,295
Gross Unrealized Gains	41	77
Gross Unrealized Losses	(184,323)	(191,711)
Estimated Fair Value	1,352,350	1,434,661
U.S. treasuries and government agencies
Available-for-sale debt securities:
Total available-for-sale debt securities	101,299	100,926
Gross Unrealized Gains	0	0
Gross Unrealized Losses	(6,954)	(7,304)
Investments available-for-sale	94,345	93,622
State and municipal
Available-for-sale debt securities:
Total available-for-sale debt securities	318,815	322,519
Gross Unrealized Gains	1	4
Gross Unrealized Losses	(50,565)	(56,526)
Investments available-for-sale	268,251	265,997
Mortgage-backed and asset-backed
Available-for-sale debt securities:
Total available-for-sale debt securities	868,704	943,398
Gross Unrealized Gains	40	73
Gross Unrealized Losses	(87,652)	(88,552)
Investments available-for-sale	781,092	854,919
Held-to-maturity debt securities:
Total held-to-maturity debt securities	247,814	259,452
Gross Unrealized Gains	0	0
Gross Unrealized Losses	(39,152)	(39,329)
Total held-to-maturity debt securities	$ 208,662	$ 220,123

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INVESTMENTS - Gross Unrealized Losses and Fair Value by Length of Time in Unrealized Loss Position (Detail) $ in Thousands	Jun. 30, 2023 USD ($) security	Dec. 31, 2022 USD ($) security
Debt Securities, Available-for-sale [Line Items]
Number of Securities | security	464	464
Fair Value
Less Than 12 Months	$ 175,640	$ 779,965
12 Months or More	957,056	400,181
Total	1,132,696	1,180,146
Unrealized Losses
Less Than 12 Months	6,530	79,408
12 Months or More	138,641	72,974
Total	$ 145,171	$ 152,382
U.S. treasuries and government agencies
Debt Securities, Available-for-sale [Line Items]
Number of Securities | security	10	10
Fair Value
Less Than 12 Months	$ 0	$ 53,139
12 Months or More	94,345	40,483
Total	94,345	93,622
Unrealized Losses
Less Than 12 Months	0	3,653
12 Months or More	6,954	3,651
Total	$ 6,954	$ 7,304
State and municipal
Debt Securities, Available-for-sale [Line Items]
Number of Securities | security	127	130
Fair Value
Less Than 12 Months	$ 17,222	$ 200,439
12 Months or More	249,495	62,482
Total	266,717	262,921
Unrealized Losses
Less Than 12 Months	488	30,803
12 Months or More	50,077	25,723
Total	$ 50,565	$ 56,526
Mortgage-backed and asset-backed
Debt Securities, Available-for-sale [Line Items]
Number of Securities | security	327	324
Fair Value
Less Than 12 Months	$ 158,418	$ 526,387
12 Months or More	613,216	297,216
Total	771,634	823,603
Unrealized Losses
Less Than 12 Months	6,042	44,952
12 Months or More	81,610	43,600
Total	$ 87,652	$ 88,552

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INVESTMENTS - Estimated Fair Values of Debt Securities by Contractual Maturity (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Fair Value
Total available-for-sale debt securities	$ 1,143,688	$ 1,214,538
Amortized Cost
Total available-for-sale debt securities	1,288,818	1,366,843
Fair Value
Total held-to-maturity debt securities	208,662	220,123
Amortized Cost
Total held-to-maturity debt securities	247,814	259,452
U.S. treasuries and government agencies
Fair Value
One year or less	14,580	0
One to five years	79,765	93,622
Five to ten years	0	0
After ten years	0	0
Total available-for-sale debt securities	94,345	93,622
Amortized Cost
One year or less	14,984	0
One to five years	86,315	100,926
Five to ten years	0	0
After ten years	0	0
Total available-for-sale debt securities	101,299	100,926
State and municipal
Fair Value
One year or less	6,799	8,694
One to five years	53,557	51,576
Five to ten years	36,343	28,806
After ten years	171,552	176,921
Total available-for-sale debt securities	268,251	265,997
Amortized Cost
One year or less	6,842	8,783
One to five years	55,926	53,948
Five to ten years	43,156	34,042
After ten years	212,891	225,746
Total available-for-sale debt securities	318,815	322,519
Mortgage-backed and asset-backed
Fair Value
One year or less	4,692	7,622
One to five years	47,004	45,366
Five to ten years	274,805	303,697
After ten years	454,591	498,234
Total available-for-sale debt securities	781,092	854,919
Amortized Cost
One year or less	4,744	7,704
One to five years	48,742	46,802
Five to ten years	305,295	335,285
After ten years	509,923	553,607
Total available-for-sale debt securities	868,704	943,398
Fair Value
One year or less	0	0
One to five years	0	0
Five to ten years	32,997	35,304
After ten years	175,665	184,819
Total held-to-maturity debt securities	208,662	220,123
Amortized Cost
One year or less	0	0
One to five years	0	0
Five to ten years	36,828	39,213
After ten years	210,986	220,239
Total held-to-maturity debt securities	$ 247,814	$ 259,452

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INVESTMENTS - Other Investments (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Federal Home Loan Bank Stock and Federal Reserve Bank Stock [Abstract]
Federal Reserve Bank stock, at cost	$ 38,961	$ 38,873
Federal Home Loan Bank of Atlanta stock, at cost	32,414	29,668
Other	677	677
Total other investments, at cost	$ 72,052	$ 69,218

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LOANS - Narrative (Details) - USD ($) $ in Millions	Jun. 30, 2023	Dec. 31, 2022
Receivables [Abstract]
Net deferred loan fees	$ 9.3	$ 10.5

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LOANS - Loan Portfolio Segment Balances (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	$ 11,369,639	$ 11,396,706
Commercial investor real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	5,131,210	5,130,094
Commercial owner-occupied real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	1,770,135	1,775,037
Commercial AD&C
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	1,045,742	1,090,028
Residential mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	1,385,743	1,287,933
Residential construction
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	190,690	224,772
Commercial real estate: | Commercial investor real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	5,131,210	5,130,094
Commercial real estate: | Commercial owner-occupied real estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	1,770,135	1,775,037
Commercial real estate: | Commercial AD&C
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	1,045,742	1,090,028
Commercial business
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	9,370,701	9,451,044
Commercial business | Commercial business
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	1,423,614	1,455,885
Residential real estate: | Residential mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	1,385,743	1,287,933
Residential real estate: | Residential construction
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	190,690	224,772
Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	422,505	432,957
Total residential and consumer loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans	$ 1,998,938	$ 1,945,662

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CREDIT QUALITY ASSESSMENT - Allowance for Credit Loss Activity (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period			$ 136,242	$ 109,145	$ 109,145
Provision/ (credit) for credit losses - loans			(14,491)	4,681	26,680
Loan charge-offs			(2,265)	(762)	(1,105)
Loan recoveries			801	606	1,522
Net (charge-offs)/ recoveries			(1,464)	(156)	417
Balance at period end	$ 120,287	$ 113,670	120,287	113,670	$ 136,242
Provision/ (credit) for credit losses	$ 5,055	$ 3,046	(16,481)	$ 4,681
Unfunded commitments
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Provision/ (credit) for credit losses			$ (2,000)

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CREDIT QUALITY ASSESSMENT - Collateral Dependent Loans (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022	Jun. 30, 2022	Dec. 31, 2021
Credit Loss [Abstract]
Collateral dependent loans individually evaluated for credit loss with an allowance	$ 48,878	$ 9,743
Collateral dependent loans individually evaluated for credit loss without an allowance	14,652	16,454
Total individually evaluated collateral dependent loans	63,530	26,197
Allowance for credit losses related to loans evaluated individually	16,224	6,902
Allowance for credit losses related to loans evaluated collectively	104,063	129,340
Total allowance for credit losses - loans	$ 120,287	$ 136,242	$ 113,670	$ 109,145

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CREDIT QUALITY ASSESSMENT - Allowance for Credit or Loan Losses by Respective Loan Portfolio Segment (Details) - USD ($) $ in Thousands	6 Months Ended		12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	$ 136,242	$ 109,145	$ 109,145
Provision/ (credit) for credit losses - loans	(14,491)	4,681	26,680
Charge-offs	(2,265)	(762)	(1,105)
Recoveries	801	606	1,522
Net (charge-offs)/ recoveries	(1,464)	(156)	417
Balance at period end	120,287	113,670	136,242
Total loans	$ 11,369,639		$ 11,396,706
Allowance for credit losses on loans to total loans ratio	1.06%		1.20%
Average loans	$ 11,397,815		$ 10,638,882
Annualized net charge-offs/ (recoveries) to average loans	0.03%		0.00%
Balance of loans individually evaluated for credit loss	$ 63,530		$ 26,197
Allowance related to loans evaluated individually	$ 16,224		$ 6,902
Individual allowance to loans evaluated individually ratio	25.54%		26.35%
Contractual balance of individually evaluated loans	$ 65,687		$ 29,475
Balance of loans collectively evaluated for credit loss	11,306,109		11,370,509
Allowance related to loans evaluated collectively	$ 104,063		$ 129,340
Collective allowance to loans evaluated collectively ratio	0.92%		1.14%
Commercial investor real estate
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Charge-offs	$ 0		$ 0
Total loans	5,131,210		5,130,094
Commercial owner-occupied real estate
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Charge-offs	0		0
Total loans	1,770,135		1,775,037
Commercial AD&C
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Charge-offs	0		0
Total loans	1,045,742		1,090,028
Residential mortgage
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Charge-offs	(160)		(155)
Total loans	1,385,743		1,287,933
Residential construction
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Charge-offs	0		0
Total loans	190,690		224,772
Commercial real estate: | Commercial investor real estate
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	64,737	45,289	45,289
Provision/ (credit) for credit losses - loans	(3,669)		19,128
Charge-offs	0		0
Recoveries	19		320
Net (charge-offs)/ recoveries	19		320
Balance at period end	61,087		64,737
Total loans	$ 5,131,210		$ 5,130,094
Allowance for credit losses on loans to total loans ratio	1.19%		1.26%
Average loans	$ 5,141,447		$ 4,681,607
Annualized net charge-offs/ (recoveries) to average loans	0.00%		(0.01%)
Balance of loans individually evaluated for credit loss	$ 48,721		$ 9,943
Allowance related to loans evaluated individually	$ 7,908		$ 134
Individual allowance to loans evaluated individually ratio	16.23%		1.35%
Contractual balance of individually evaluated loans	$ 48,886		$ 10,882
Balance of loans collectively evaluated for credit loss	5,082,489		5,120,151
Allowance related to loans evaluated collectively	$ 53,179		$ 64,603
Collective allowance to loans evaluated collectively ratio	1.05%		1.26%
Commercial real estate: | Commercial owner-occupied real estate
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	$ 11,646	11,687	$ 11,687
Provision/ (credit) for credit losses - loans	(2,469)		(90)
Charge-offs	0		0
Recoveries	53		49
Net (charge-offs)/ recoveries	53		49
Balance at period end	9,230		11,646
Total loans	$ 1,770,135		$ 1,775,037
Allowance for credit losses on loans to total loans ratio	0.52%		0.66%
Average loans	$ 1,771,369		$ 1,730,293
Annualized net charge-offs/ (recoveries) to average loans	(0.01%)		0.00%
Balance of loans individually evaluated for credit loss	$ 4,846		$ 6,155
Allowance related to loans evaluated individually	$ 1,226		$ 1,261
Individual allowance to loans evaluated individually ratio	25.30%		20.49%
Contractual balance of individually evaluated loans	$ 5,675		$ 6,849
Balance of loans collectively evaluated for credit loss	1,765,289		1,768,882
Allowance related to loans evaluated collectively	$ 8,004		$ 10,385
Collective allowance to loans evaluated collectively ratio	0.45%		0.59%
Commercial real estate: | Commercial AD&C
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	$ 18,646	20,322	$ 20,322
Provision/ (credit) for credit losses - loans	(8,446)		(1,676)
Charge-offs	0		0
Recoveries	0		0
Net (charge-offs)/ recoveries	0		0
Balance at period end	10,200		18,646
Total loans	$ 1,045,742		$ 1,090,028
Allowance for credit losses on loans to total loans ratio	0.98%		1.71%
Average loans	$ 1,069,927		$ 1,112,936
Annualized net charge-offs/ (recoveries) to average loans	0.00%		0.00%
Balance of loans individually evaluated for credit loss	$ 570		$ 0
Allowance related to loans evaluated individually	$ 102		$ 0
Individual allowance to loans evaluated individually ratio	17.89%		0.00%
Contractual balance of individually evaluated loans	$ 581		$ 0
Balance of loans collectively evaluated for credit loss	1,045,172		1,090,028
Allowance related to loans evaluated collectively	$ 10,098		$ 18,646
Collective allowance to loans evaluated collectively ratio	0.97%		1.71%
Commercial Business
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Total loans	$ 9,370,701		$ 9,451,044
Commercial Business | Commercial business
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	28,027	23,170	23,170
Provision/ (credit) for credit losses - loans	123		4,774
Charge-offs	(423)		(716)
Recoveries	187		799
Net (charge-offs)/ recoveries	(236)		83
Balance at period end	27,914		28,027
Total loans	$ 1,423,614		$ 1,455,885
Allowance for credit losses on loans to total loans ratio	1.96%		1.93%
Average loans	$ 1,443,030		$ 1,351,906
Annualized net charge-offs/ (recoveries) to average loans	0.03%		(0.01%)
Balance of loans individually evaluated for credit loss	$ 9,393		$ 8,274
Allowance related to loans evaluated individually	$ 6,988		$ 5,507
Individual allowance to loans evaluated individually ratio	74.40%		66.56%
Contractual balance of individually evaluated loans	$ 10,545		$ 9,893
Balance of loans collectively evaluated for credit loss	1,414,221		1,447,611
Allowance related to loans evaluated collectively	$ 20,926		$ 22,520
Collective allowance to loans evaluated collectively ratio	1.48%		1.56%
Residential real estate: | Residential mortgage
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	$ 9,424	5,384	$ 5,384
Provision/ (credit) for credit losses - loans	(207)		4,093
Charge-offs	(160)		(155)
Recoveries	104		102
Net (charge-offs)/ recoveries	(56)		(53)
Balance at period end	9,161		9,424
Total loans	$ 1,385,743		$ 1,287,933
Allowance for credit losses on loans to total loans ratio	0.66%		0.73%
Average loans	$ 1,330,912		$ 1,117,053
Annualized net charge-offs/ (recoveries) to average loans	0.01%		0.00%
Balance of loans individually evaluated for credit loss	$ 0		$ 1,487
Allowance related to loans evaluated individually	$ 0		$ 0
Individual allowance to loans evaluated individually ratio	0.00%		0.00%
Contractual balance of individually evaluated loans	$ 0		$ 1,487
Balance of loans collectively evaluated for credit loss	1,385,743		1,286,446
Allowance related to loans evaluated collectively	$ 9,161		$ 9,424
Collective allowance to loans evaluated collectively ratio	0.66%		0.73%
Residential real estate: | Residential construction
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	$ 1,337	1,048	$ 1,048
Provision/ (credit) for credit losses - loans	(487)		281
Charge-offs	0		0
Recoveries	0		8
Net (charge-offs)/ recoveries	0		8
Balance at period end	850		1,337
Total loans	$ 190,690		$ 224,772
Allowance for credit losses on loans to total loans ratio	0.45%		0.59%
Average loans	$ 217,419		$ 221,341
Annualized net charge-offs/ (recoveries) to average loans	0.00%		0.00%
Balance of loans individually evaluated for credit loss	$ 0		$ 0
Allowance related to loans evaluated individually	$ 0		$ 0
Individual allowance to loans evaluated individually ratio	0.00%		0.00%
Contractual balance of individually evaluated loans	$ 0		$ 0
Balance of loans collectively evaluated for credit loss	190,690		224,772
Allowance related to loans evaluated collectively	$ 850		$ 1,337
Collective allowance to loans evaluated collectively ratio	0.45%		0.59%
Consumer
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	$ 2,425	$ 2,245	$ 2,245
Provision/ (credit) for credit losses - loans	664		170
Charge-offs	(1,682)		(234)
Recoveries	438		244
Net (charge-offs)/ recoveries	(1,244)		10
Balance at period end	1,845		2,425
Total loans	$ 422,505		$ 432,957
Allowance for credit losses on loans to total loans ratio	0.44%		0.56%
Average loans	$ 423,711		$ 423,746
Annualized net charge-offs/ (recoveries) to average loans	0.59%		0.00%
Balance of loans individually evaluated for credit loss	$ 0		$ 338
Allowance related to loans evaluated individually	$ 0		$ 0
Individual allowance to loans evaluated individually ratio	0.00%		0.00%
Contractual balance of individually evaluated loans	$ 0		$ 364
Balance of loans collectively evaluated for credit loss	422,505		432,619
Allowance related to loans evaluated collectively	$ 1,845		$ 2,425
Collective allowance to loans evaluated collectively ratio	0.44%		0.56%

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CREDIT QUALITY ASSESSMENT - Information on the Credit Quality of Loan Portfolio (Details) - Non-accrual status - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Accounts Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	$ 34,782	$ 46,086
Loans placed on non-accrual	28,990	12,130
Non-accrual balances transferred to OREO	0	0
Non-accrual balances charged-off	(2,175)	(860)
Net payments or draws	(11,866)	(19,065)
Non-accrual loans brought current	(993)	(3,509)
Balance at end of period	48,738	34,782
Commercial real estate: | Commercial investor real estate
Accounts Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	9,943	12,489
Loans placed on non-accrual	19,622	4,761
Non-accrual balances transferred to OREO	0	0
Non-accrual balances charged-off	0	0
Net payments or draws	(9,184)	(7,307)
Non-accrual loans brought current	0	0
Balance at end of period	20,381	9,943
Commercial real estate: | Commercial owner-occupied real estate
Accounts Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	5,019	9,306
Loans placed on non-accrual	0	2,370
Non-accrual balances transferred to OREO	0	0
Non-accrual balances charged-off	0	0
Net payments or draws	(173)	(4,366)
Non-accrual loans brought current	0	(2,291)
Balance at end of period	4,846	5,019
Commercial real estate: | Commercial AD&C
Accounts Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	0	650
Loans placed on non-accrual	569	0
Non-accrual balances transferred to OREO	0	0
Non-accrual balances charged-off	0	0
Net payments or draws	0	(650)
Non-accrual loans brought current	0	0
Balance at end of period	569	0
Commercial Business
Accounts Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	7,322	8,420
Loans placed on non-accrual	4,362	1,591
Non-accrual balances transferred to OREO	0	0
Non-accrual balances charged-off	(424)	(677)
Net payments or draws	(1,354)	(2,012)
Non-accrual loans brought current	(513)	0
Balance at end of period	9,393	7,322
Residential real estate: | Residential mortgage
Accounts Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	7,439	8,441
Loans placed on non-accrual	3,540	2,593
Non-accrual balances transferred to OREO	0	0
Non-accrual balances charged-off	(160)	(151)
Net payments or draws	(309)	(2,615)
Non-accrual loans brought current	(357)	(829)
Balance at end of period	10,153	7,439
Residential real estate: | Residential construction
Accounts Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	0	55
Loans placed on non-accrual	0	0
Non-accrual balances transferred to OREO	0	0
Non-accrual balances charged-off	0	0
Net payments or draws	0	(55)
Non-accrual loans brought current	0	0
Balance at end of period	0	0
Consumer
Accounts Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	5,059	6,725
Loans placed on non-accrual	897	815
Non-accrual balances transferred to OREO	0	0
Non-accrual balances charged-off	(1,591)	(32)
Net payments or draws	(846)	(2,060)
Non-accrual loans brought current	(123)	(389)
Balance at end of period	$ 3,396	$ 5,059

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CREDIT QUALITY ASSESSMENT - Credit Quality of Loan Portfolio, New (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Financing Receivable, Past Due [Line Items]
Total loans	$ 11,369,639	$ 11,396,706
Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	11,320,180	11,357,347
Non-performing loans:
Financing Receivable, Past Due [Line Items]
Non-accrual loans	48,738	34,782
Loans greater than 90 days past due	721	1,002
Restructured loans	0	3,575
Total loans	49,459	39,359
Current | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	11,303,348	11,312,130
30-59 days | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	12,341	32,576
60-89 days | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	4,491	12,641
Commercial investor real estate
Financing Receivable, Past Due [Line Items]
Total loans	5,131,210	5,130,094
Commercial owner-occupied real estate
Financing Receivable, Past Due [Line Items]
Total loans	1,770,135	1,775,037
Commercial AD&C
Financing Receivable, Past Due [Line Items]
Total loans	1,045,742	1,090,028
Residential mortgage
Financing Receivable, Past Due [Line Items]
Total loans	1,385,743	1,287,933
Residential construction
Financing Receivable, Past Due [Line Items]
Total loans	190,690	224,772
Commercial real estate: | Commercial investor real estate
Financing Receivable, Past Due [Line Items]
Total loans	5,131,210	5,130,094
Commercial real estate: | Commercial investor real estate | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	5,110,829	5,120,151
Commercial real estate: | Commercial investor real estate | Non-performing loans:
Financing Receivable, Past Due [Line Items]
Non-accrual loans	20,381	9,943
Loans greater than 90 days past due	0	0
Restructured loans	0	0
Total loans	20,381	9,943
Commercial real estate: | Commercial investor real estate | Current | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	5,108,614	5,104,204
Commercial real estate: | Commercial investor real estate | 30-59 days | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	2,215	9,735
Commercial real estate: | Commercial investor real estate | 60-89 days | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	0	6,212
Commercial real estate: | Commercial owner-occupied real estate
Financing Receivable, Past Due [Line Items]
Total loans	1,770,135	1,775,037
Commercial real estate: | Commercial owner-occupied real estate | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	1,765,289	1,768,882
Commercial real estate: | Commercial owner-occupied real estate | Non-performing loans:
Financing Receivable, Past Due [Line Items]
Non-accrual loans	4,846	5,019
Loans greater than 90 days past due	0	0
Restructured loans	0	1,136
Total loans	4,846	6,155
Commercial real estate: | Commercial owner-occupied real estate | Current | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	1,763,223	1,767,875
Commercial real estate: | Commercial owner-occupied real estate | 30-59 days | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	2,066	1,007
Commercial real estate: | Commercial owner-occupied real estate | 60-89 days | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Commercial real estate: | Commercial AD&C
Financing Receivable, Past Due [Line Items]
Total loans	1,045,742	1,090,028
Commercial real estate: | Commercial AD&C | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	1,045,173	1,090,028
Commercial real estate: | Commercial AD&C | Non-performing loans:
Financing Receivable, Past Due [Line Items]
Non-accrual loans	569	0
Loans greater than 90 days past due	0	0
Restructured loans	0	0
Total loans	569	0
Commercial real estate: | Commercial AD&C | Current | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	1,044,320	1,090,028
Commercial real estate: | Commercial AD&C | 30-59 days | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Commercial real estate: | Commercial AD&C | 60-89 days | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	853	0
Commercial Business
Financing Receivable, Past Due [Line Items]
Total loans	9,370,701	9,451,044
Commercial Business | Commercial business
Financing Receivable, Past Due [Line Items]
Total loans	1,423,614	1,455,885
Commercial Business | Commercial business | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	1,414,192	1,446,609
Commercial Business | Commercial business | Non-performing loans:
Financing Receivable, Past Due [Line Items]
Non-accrual loans	9,393	7,322
Loans greater than 90 days past due	29	1,002
Restructured loans	0	952
Total loans	9,422	9,276
Commercial Business | Commercial business | Current | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	1,413,058	1,443,012
Commercial Business | Commercial business | 30-59 days | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	747	3,556
Commercial Business | Commercial business | 60-89 days | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	387	41
Residential real estate: | Residential mortgage
Financing Receivable, Past Due [Line Items]
Total loans	1,385,743	1,287,933
Residential real estate: | Residential mortgage | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	1,374,898	1,279,007
Residential real estate: | Residential mortgage | Non-performing loans:
Financing Receivable, Past Due [Line Items]
Non-accrual loans	10,153	7,439
Loans greater than 90 days past due	692	0
Restructured loans	0	1,487
Total loans	10,845	8,926
Residential real estate: | Residential mortgage | Current | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	1,366,644	1,261,878
Residential real estate: | Residential mortgage | 30-59 days | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	5,464	11,307
Residential real estate: | Residential mortgage | 60-89 days | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	2,790	5,822
Residential real estate: | Residential construction
Financing Receivable, Past Due [Line Items]
Total loans	190,690	224,772
Residential real estate: | Residential construction | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	190,690	224,772
Residential real estate: | Residential construction | Non-performing loans:
Financing Receivable, Past Due [Line Items]
Non-accrual loans	0	0
Loans greater than 90 days past due	0	0
Restructured loans	0	0
Total loans	0	0
Residential real estate: | Residential construction | Current | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	190,690	222,144
Residential real estate: | Residential construction | 30-59 days | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	0	2,628
Residential real estate: | Residential construction | 60-89 days | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	0	0
Consumer
Financing Receivable, Past Due [Line Items]
Total loans	422,505	432,957
Consumer | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	419,109	427,898
Consumer | Non-performing loans:
Financing Receivable, Past Due [Line Items]
Non-accrual loans	3,396	5,059
Loans greater than 90 days past due	0	0
Restructured loans	0	0
Total loans	3,396	5,059
Consumer | Current | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	416,799	422,989
Consumer | 30-59 days | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	1,849	4,343
Consumer | 60-89 days | Performing loans:
Financing Receivable, Past Due [Line Items]
Total loans	$ 461	$ 566

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CREDIT QUALITY ASSESSMENT - Non-accrual Loans (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Financing Receivable, Nonaccrual [Line Items]
Average non-accrual loans for the period	$ 42,399	$ 41,192
Contractual interest income due on non- accrual loans during the period	1,554	2,009
Commercial real estate: | Commercial investor real estate
Financing Receivable, Nonaccrual [Line Items]
Average non-accrual loans for the period	15,258	11,892
Contractual interest income due on non- accrual loans during the period	559	713
Commercial real estate: | Commercial owner-occupied real estate
Financing Receivable, Nonaccrual [Line Items]
Average non-accrual loans for the period	4,938	7,314
Contractual interest income due on non- accrual loans during the period	146	106
Commercial real estate: | Commercial AD&C
Financing Receivable, Nonaccrual [Line Items]
Average non-accrual loans for the period	190	617
Contractual interest income due on non- accrual loans during the period	24	30
Commercial Business
Financing Receivable, Nonaccrual [Line Items]
Average non-accrual loans for the period	8,719	7,768
Contractual interest income due on non- accrual loans during the period	350	491
Residential real estate: | Residential mortgage
Financing Receivable, Nonaccrual [Line Items]
Average non-accrual loans for the period	8,842	7,769
Contractual interest income due on non- accrual loans during the period	232	319
Residential real estate: | Residential construction
Financing Receivable, Nonaccrual [Line Items]
Average non-accrual loans for the period	0	21
Contractual interest income due on non- accrual loans during the period	0	1
Consumer
Financing Receivable, Nonaccrual [Line Items]
Average non-accrual loans for the period	4,452	5,811
Contractual interest income due on non- accrual loans during the period	$ 243	$ 349

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CREDIT QUALITY ASSESSMENT - Narrative (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Accounts, Notes, Loans and Financing Receivable [Line Items]
Other real estate owned	$ 611	$ 645
Unfunded loan commitments for borrowers experiencing financial difficulty	1,200
Non-accrual status
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loans placed on non-accrual	28,990	12,130
Reversal of uncollected accrued interest	400
Restructured Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Other real estate owned	$ 600	$ 600

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CREDIT QUALITY ASSESSMENT - Information about Credit Quality Indicator by Year of Origination (Details) - USD ($) $ in Thousands	6 Months Ended		12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	$ 642,534		$ 3,120,897
Year one	2,980,425		2,647,414
Year two	2,518,171		1,339,364
Year three	1,301,578		1,039,363
Year four	941,066		649,024
Prior	1,977,227		1,559,209
Revolving Loans	1,008,638		1,041,435
Total loans	11,369,639		11,396,706
Current period gross charge-offs, Total	2,265	$ 762	1,105
Commercial investor real estate
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	242,226		1,543,664
Year one	1,412,830		1,216,546
Year two	1,244,728		695,224
Year three	689,275		567,341
Year four	554,346		343,815
Prior	962,950		748,262
Revolving Loans	24,855		15,242
Total loans	5,131,210		5,130,094
Current period gross charge-offs, current year	0		0
Current period gross charge-offs, year one	0		0
Current period gross charge-offs, year two	0		0
Current period gross charge-offs, year three	0		0
Current period gross charge-offs, year four	0		0
Current period gross charge-offs, prior	0		0
Current period gross charge-offs, revolving	0		0
Current period gross charge-offs, Total	0		0
Commercial investor real estate | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	221,130		1,510,446
Year one	1,401,988		1,197,504
Year two	1,210,529		694,756
Year three	689,275		567,247
Year four	552,876		335,103
Prior	958,510		742,405
Revolving Loans	24,855		15,242
Total loans	5,059,163		5,062,703
Commercial investor real estate | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	6,297		32,661
Year one	10,298		17,146
Year two	30,536		468
Year three	0		94
Year four	93		473
Prior	2,880		4,814
Revolving Loans	0		0
Total loans	50,104		55,656
Commercial investor real estate | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	14,799		557
Year one	544		1,896
Year two	3,663		0
Year three	0		0
Year four	1,377		8,239
Prior	1,560		1,043
Revolving Loans	0		0
Total loans	21,943		11,735
Commercial investor real estate | Doubtful
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	0		0
Year one	0		0
Year two	0		0
Year three	0		0
Year four	0		0
Prior	0		0
Revolving Loans	0		0
Total loans	0		0
Commercial owner-occupied real estate
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	91,481		399,126
Year one	371,068		328,817
Year two	325,962		242,172
Year three	240,139		267,964
Year four	252,485		144,917
Prior	486,816		390,874
Revolving Loans	2,184		1,167
Total loans	1,770,135		1,775,037
Current period gross charge-offs, current year	0		0
Current period gross charge-offs, year one	0		0
Current period gross charge-offs, year two	0		0
Current period gross charge-offs, year three	0		0
Current period gross charge-offs, year four	0		0
Current period gross charge-offs, prior	0		0
Current period gross charge-offs, revolving	0		0
Current period gross charge-offs, Total	0		0
Commercial owner-occupied real estate | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	87,454		391,340
Year one	366,576		328,657
Year two	325,147		240,738
Year three	238,899		260,114
Year four	246,174		140,841
Prior	474,408		381,386
Revolving Loans	2,184		1,167
Total loans	1,740,842		1,744,243
Commercial owner-occupied real estate | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	731		4,567
Year one	739		0
Year two	0		1,301
Year three	889		1,740
Year four	323		2,066
Prior	7,538		7,323
Revolving Loans	0		0
Total loans	10,220		16,997
Commercial owner-occupied real estate | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	3,296		3,219
Year one	3,753		160
Year two	815		133
Year three	351		6,110
Year four	5,988		2,010
Prior	4,870		2,165
Revolving Loans	0		0
Total loans	19,073		13,797
Commercial owner-occupied real estate | Doubtful
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	0		0
Year one	0		0
Year two	0		0
Year three	0		0
Year four	0		0
Prior	0		0
Revolving Loans	0		0
Total loans	0		0
Commercial AD&C
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	191,437		367,169
Year one	319,457		439,468
Year two	284,974		113,713
Year three	78,362		34,340
Year four	1,867		14,816
Prior	15,079		0
Revolving Loans	154,566		120,522
Total loans	1,045,742		1,090,028
Current period gross charge-offs, current year	0		0
Current period gross charge-offs, year one	0		0
Current period gross charge-offs, year two	0		0
Current period gross charge-offs, year three	0		0
Current period gross charge-offs, year four	0		0
Current period gross charge-offs, prior	0		0
Current period gross charge-offs, revolving	0		0
Current period gross charge-offs, Total	0		0
Commercial AD&C | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	189,426		366,096
Year one	318,888		439,468
Year two	284,974		113,713
Year three	78,362		34,340
Year four	1,867		14,816
Prior	15,079		0
Revolving Loans	154,566		119,727
Total loans	1,043,162		1,088,160
Commercial AD&C | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	1,661		1,073
Year one	0		0
Year two	0		0
Year three	0		0
Year four	0		0
Prior	0		0
Revolving Loans	0		795
Total loans	1,661		1,868
Commercial AD&C | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	350		0
Year one	569		0
Year two	0		0
Year three	0		0
Year four	0		0
Prior	0		0
Revolving Loans	0		0
Total loans	919		0
Commercial AD&C | Doubtful
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	0		0
Year one	0		0
Year two	0		0
Year three	0		0
Year four	0		0
Prior	0		0
Revolving Loans	0		0
Total loans	0		0
Residential mortgage
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	18,948		336,909
Year one	388,761		357,307
Year two	407,664		176,834
Year three	176,689		50,886
Year four	49,469		61,970
Prior	344,212		304,027
Revolving Loans	0		0
Total loans	1,385,743		1,287,933
Current period gross charge-offs, current year	0		0
Current period gross charge-offs, year one	0		0
Current period gross charge-offs, year two	43		0
Current period gross charge-offs, year three	0		0
Current period gross charge-offs, year four	10		24
Current period gross charge-offs, prior	107		131
Current period gross charge-offs, revolving	0		0
Current period gross charge-offs, Total	160		155
Residential mortgage | 660-850
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	18,644		330,109
Year one	377,467		344,062
Year two	387,642		171,330
Year three	168,643		41,883
Year four	41,092		51,651
Prior	290,758		262,570
Revolving Loans	0		0
Total loans	1,284,246		1,201,605
Residential mortgage | 600-659
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	0		4,571
Year one	8,016		6,196
Year two	13,725		1,173
Year three	4,075		3,925
Year four	3,858		6,041
Prior	29,123		24,006
Revolving Loans	0		0
Total loans	58,797		45,912
Residential mortgage | 540-599
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	304		369
Year one	2,915		4,013
Year two	3,291		1,439
Year three	523		1,256
Year four	1,511		1,931
Prior	8,894		6,945
Revolving Loans	0		0
Total loans	17,438		15,953
Residential mortgage | less than 540
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	0		1,860
Year one	363		3,036
Year two	3,006		2,892
Year three	3,448		3,822
Year four	3,008		2,347
Prior	15,437		10,506
Revolving Loans	0		0
Total loans	25,262		24,463
Residential construction
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	9,689		132,776
Year one	136,444		77,036
Year two	37,326		12,133
Year three	5,837		150
Year four	150		1,432
Prior	1,244		1,245
Revolving Loans	0		0
Total loans	190,690		224,772
Current period gross charge-offs, current year	0		0
Current period gross charge-offs, year one	0		0
Current period gross charge-offs, year two	0		0
Current period gross charge-offs, year three	0		0
Current period gross charge-offs, year four	0		0
Current period gross charge-offs, prior	0		0
Current period gross charge-offs, revolving	0		0
Current period gross charge-offs, Total	0		0
Residential construction | 660-850
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	9,189		131,259
Year one	135,471		75,844
Year two	36,186		12,133
Year three	5,837		150
Year four	150		1,432
Prior	1,244		1,245
Revolving Loans	0		0
Total loans	188,077		222,063
Residential construction | 600-659
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	0		908
Year one	973		373
Year two	739		0
Year three	0		0
Year four	0		0
Prior	0		0
Revolving Loans	0		0
Total loans	1,712		1,281
Residential construction | 540-599
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	0		609
Year one	0		0
Year two	401		0
Year three	0		0
Year four	0		0
Prior	0		0
Revolving Loans	0		0
Total loans	401		609
Residential construction | less than 540
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	500		0
Year one	0		819
Year two	0		0
Year three	0		0
Year four	0		0
Prior	0		0
Revolving Loans	0		0
Total loans	500		819
Commercial Business
Financing Receivable, Credit Quality Indicator [Line Items]
Total loans	9,370,701		9,451,044
Commercial Business | Commercial business
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	83,152		333,627
Year one	344,901		225,314
Year two	214,650		97,988
Year three	110,020		115,739
Year four	79,975		78,838
Prior	132,154		80,452
Revolving Loans	458,762		523,927
Total loans	1,423,614		1,455,885
Current period gross charge-offs, current year	0		174
Current period gross charge-offs, year one	0		0
Current period gross charge-offs, year two	324		0
Current period gross charge-offs, year three	0		0
Current period gross charge-offs, year four	0		138
Current period gross charge-offs, prior	99		404
Current period gross charge-offs, revolving			0
Current period gross charge-offs, Total	423		716
Commercial Business | Commercial business | Pass
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	81,897		330,598
Year one	342,575		223,245
Year two	212,680		95,787
Year three	108,084		105,922
Year four	75,222		77,891
Prior	129,998		78,009
Revolving Loans	441,542		508,839
Total loans	1,391,998		1,420,291
Commercial Business | Commercial business | Special Mention
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	0		127
Year one	95		458
Year two	204		1,107
Year three	942		7,787
Year four	2,172		498
Prior	338		322
Revolving Loans	13,398		13,225
Total loans	17,149		23,524
Commercial Business | Commercial business | Substandard
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	1,255		2,902
Year one	2,231		1,611
Year two	1,766		1,094
Year three	994		2,030
Year four	2,581		449
Prior	1,818		2,121
Revolving Loans	3,822		1,863
Total loans	14,467		12,070
Commercial Business | Commercial business | Doubtful
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	0		0
Year one	0		0
Year two	0		0
Year three	0		0
Year four	0		0
Prior	0		0
Revolving Loans	0		0
Total loans	0		0
Consumer
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	5,601		7,626
Year one	6,964		2,926
Year two	2,867		1,300
Year three	1,256		2,943
Year four	2,774		3,236
Prior	34,772		34,349
Revolving Loans	368,271		380,577
Total loans	422,505		432,957
Current period gross charge-offs, current year	0		0
Current period gross charge-offs, year one	1		5
Current period gross charge-offs, year two	0		15
Current period gross charge-offs, year three	0		0
Current period gross charge-offs, year four	0		13
Current period gross charge-offs, prior	1,594		20
Current period gross charge-offs, revolving	87		181
Current period gross charge-offs, Total	1,682		234
Consumer | 660-850
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	4,743		6,689
Year one	6,164		2,346
Year two	2,515		1,201
Year three	764		2,147
Year four	2,048		2,047
Prior	24,430		23,170
Revolving Loans	344,560		359,468
Total loans	385,224		397,068
Consumer | 600-659
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	325		658
Year one	543		467
Year two	21		59
Year three	163		198
Year four	113		664
Prior	5,299		5,459
Revolving Loans	12,686		11,269
Total loans	19,150		18,774
Consumer | 540-599
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	309		123
Year one	79		56
Year two	83		0
Year three	38		465
Year four	127		316
Prior	2,293		2,802
Revolving Loans	4,456		3,824
Total loans	7,385		7,586
Consumer | less than 540
Financing Receivable, Credit Quality Indicator [Line Items]
Current year	224		156
Year one	178		57
Year two	248		40
Year three	291		133
Year four	486		209
Prior	2,750		2,918
Revolving Loans	6,569		6,016
Total loans	$ 10,746		$ 9,529

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CREDIT QUALITY ASSESSMENT - Loans Modified (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2023 USD ($)
Financing Receivable, Troubled Debt Restructuring [Line Items]
Amount	$ 32,193
% of total loan segment	0.30%
Commercial real estate: | Commercial investor real estate
Financing Receivable, Troubled Debt Restructuring [Line Items]
Amount	$ 28,893
% of total loan segment	0.60%
Commercial real estate: | Commercial owner-occupied real estate
Financing Receivable, Troubled Debt Restructuring [Line Items]
Amount	$ 2,000
% of total loan segment	0.10%
Commercial real estate: | Commercial AD&C
Financing Receivable, Troubled Debt Restructuring [Line Items]
Amount	$ 350
% of total loan segment	0.00%
Commercial business
Financing Receivable, Troubled Debt Restructuring [Line Items]
Amount	$ 950
% of total loan segment	0.10%
All Other loans
Financing Receivable, Troubled Debt Restructuring [Line Items]
Amount	$ 0
% of total loan segment	0.00%
Interest rate reduction
Financing Receivable, Troubled Debt Restructuring [Line Items]
Amount	$ 28,340
% of total loan segment	0.20%
Interest rate reduction | Commercial real estate: | Commercial investor real estate
Financing Receivable, Troubled Debt Restructuring [Line Items]
Amount	$ 28,340
% of total loan segment	0.60%
Interest rate reduction | Commercial real estate: | Commercial owner-occupied real estate
Financing Receivable, Troubled Debt Restructuring [Line Items]
Amount	$ 0
% of total loan segment	0.00%
Interest rate reduction | Commercial real estate: | Commercial AD&C
Financing Receivable, Troubled Debt Restructuring [Line Items]
Amount	$ 0
% of total loan segment	0.00%
Interest rate reduction | Commercial business
Financing Receivable, Troubled Debt Restructuring [Line Items]
Amount	$ 0
% of total loan segment	0.00%
Interest rate reduction | All Other loans
Financing Receivable, Troubled Debt Restructuring [Line Items]
Amount	$ 0
% of total loan segment	0.00%
Term extension
Financing Receivable, Troubled Debt Restructuring [Line Items]
Amount	$ 3,853
% of total loan segment	0.00%
Term extension | Commercial real estate: | Commercial investor real estate
Financing Receivable, Troubled Debt Restructuring [Line Items]
Amount	$ 553
% of total loan segment	0.00%
Term extension | Commercial real estate: | Commercial owner-occupied real estate
Financing Receivable, Troubled Debt Restructuring [Line Items]
Amount	$ 2,000
% of total loan segment	0.10%
Term extension | Commercial real estate: | Commercial AD&C
Financing Receivable, Troubled Debt Restructuring [Line Items]
Amount	$ 350
% of total loan segment	0.00%
Term extension | Commercial business
Financing Receivable, Troubled Debt Restructuring [Line Items]
Amount	$ 950
% of total loan segment	0.10%
Term extension | All Other loans
Financing Receivable, Troubled Debt Restructuring [Line Items]
Amount	$ 0
% of total loan segment	0.00%

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CREDIT QUALITY ASSESSMENT - Financial Effect of Modifications (Details)	6 Months Ended
	Jun. 30, 2023
Commercial real estate: | Commercial investor real estate | Term extension
Financing Receivable, Troubled Debt Restructuring [Line Items]
Term extension	5 months
Commercial real estate: | Commercial owner-occupied real estate | Term extension
Financing Receivable, Troubled Debt Restructuring [Line Items]
Term extension	8 months
Commercial real estate: | Commercial AD&C | Term extension
Financing Receivable, Troubled Debt Restructuring [Line Items]
Term extension	9 months
Commercial business | Term extension
Financing Receivable, Troubled Debt Restructuring [Line Items]
Term extension	8 months
Maximum | Commercial real estate: | Commercial investor real estate | Interest rate reduction
Financing Receivable, Troubled Debt Restructuring [Line Items]
Interest rate reduction	8.00%
Minimum | Commercial real estate: | Commercial investor real estate | Interest rate reduction
Financing Receivable, Troubled Debt Restructuring [Line Items]
Interest rate reduction	5.00%

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CREDIT QUALITY ASSESSMENT - Performance of Modified Loans (Details) $ in Thousands	Jun. 30, 2023 USD ($)
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	$ 32,193
Current
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	31,980
30-89 days past due
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	213
90+ days past due
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	0
Non-accrual
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	0
Commercial real estate: | Commercial investor real estate
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	28,893
Commercial real estate: | Commercial investor real estate | Current
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	28,680
Commercial real estate: | Commercial investor real estate | 30-89 days past due
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	213
Commercial real estate: | Commercial investor real estate | 90+ days past due
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	0
Commercial real estate: | Commercial investor real estate | Non-accrual
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	0
Commercial real estate: | Commercial owner-occupied real estate
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	2,000
Commercial real estate: | Commercial owner-occupied real estate | Current
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	2,000
Commercial real estate: | Commercial owner-occupied real estate | 30-89 days past due
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	0
Commercial real estate: | Commercial owner-occupied real estate | 90+ days past due
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	0
Commercial real estate: | Commercial owner-occupied real estate | Non-accrual
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	0
Commercial real estate: | Commercial AD&C
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	350
Commercial real estate: | Commercial AD&C | Current
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	350
Commercial real estate: | Commercial AD&C | 30-89 days past due
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	0
Commercial real estate: | Commercial AD&C | 90+ days past due
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	0
Commercial real estate: | Commercial AD&C | Non-accrual
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	0
Commercial business
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	950
Commercial business | Current
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	950
Commercial business | 30-89 days past due
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	0
Commercial business | 90+ days past due
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	0
Commercial business | Non-accrual
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	0
All Other loans
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	0
All Other loans | Current
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	0
All Other loans | 30-89 days past due
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	0
All Other loans | 90+ days past due
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	0
All Other loans | Non-accrual
Financing Receivable, Troubled Debt Restructuring [Line Items]
Total	$ 0

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GOODWILL AND OTHER INTANGIBLE ASSETS - Amount of Goodwill by Reporting Units (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2023 USD ($)
Goodwill [Roll Forward]
Beginning balance	$ 363,436
No activity	0
Ending balance	363,436
Community Banking
Goodwill [Roll Forward]
Beginning balance	331,689
No activity	0
Ending balance	331,689
Investment Management
Goodwill [Roll Forward]
Beginning balance	31,747
No activity	0
Ending balance	$ 31,747

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GOODWILL AND OTHER INTANGIBLE ASSETS - Gross Carrying Amounts and Accumulated Amortization (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 42,944	$ 42,944
Accumulated Amortization	(25,664)	(23,089)
Net Carrying Amount	17,280	19,855
Goodwill	363,436	363,436
Goodwill	363,436	363,436
Core deposit intangibles
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	29,038	29,038
Accumulated Amortization	(18,486)	(16,694)
Net Carrying Amount	$ 10,552	$ 12,344
Core deposit intangibles | Weighted Average
Finite-Lived Intangible Assets [Line Items]
Weighted Average Remaining Life	6 years	6 years 6 months
Other identifiable intangibles
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 13,906	$ 13,906
Accumulated Amortization	(7,178)	(6,395)
Net Carrying Amount	$ 6,728	$ 7,511
Other identifiable intangibles | Weighted Average
Finite-Lived Intangible Assets [Line Items]
Weighted Average Remaining Life	8 years 2 months 12 days	8 years 9 months 18 days

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GOODWILL AND OTHER INTANGIBLE ASSETS - Estimated Future Amortization Expense for Amortizing Intangibles (Details) $ in Thousands	Jun. 30, 2023 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
Remaining 2023	$ 2,465
2024	4,291
2025	3,530
2026	2,702
2027	1,945
Thereafter	2,347
Total amortizing intangible assets	$ 17,280

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DEPOSITS - Composition of Deposits (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Deposits [Abstract]
Noninterest-bearing deposits	$ 3,079,896	$ 3,673,300
Interest-bearing deposits:
Demand	1,413,027	1,435,454
Money market savings	2,918,253	3,213,045
Regular savings	731,985	513,360
Time deposits of less than $250,000	2,293,858	1,644,645
Time deposits of $250,000 or more	521,903	473,617
Total interest-bearing deposits	7,879,026	7,280,121
Total deposits	$ 10,958,922	$ 10,953,421

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BORROWINGS - Narrative (Details) - USD ($)	Mar. 15, 2022	Nov. 05, 2019	Jun. 30, 2023	Dec. 31, 2022
Debt Instrument [Line Items]
Long-term borrowings			$ 370,504,000	$ 370,205,000
FHLB availability based on pledged collateral			2,600,000,000	2,600,000,000
FHLB advances			600,000,000	550,000,000
Unsecured lines of credit, correspondent banks
Debt Instrument [Line Items]
Maximum borrowing capacity			1,000,000,000	1,600,000,000
Federal Reserve Bank Term Funding Program
Debt Instrument [Line Items]
Maximum borrowing capacity			16,600,000
Line of credit			300,000,000
Federal Home Loan Bank Advances
Debt Instrument [Line Items]
Maximum borrowing capacity			3,200,000,000	3,200,000,000
Federal Home Loan Bank Advances | Residential mortgage | Asset pledged as collateral | Federal Home Loan Bank Advances
Debt Instrument [Line Items]
Maximum borrowing capacity			1,300,000,000	1,200,000,000
Federal Home Loan Bank Advances | Commercial real estate loans | Asset pledged as collateral | Federal Home Loan Bank Advances
Debt Instrument [Line Items]
Maximum borrowing capacity			4,000,000,000	3,600,000,000
Federal Home Loan Bank Advances | Home equity lines of credit | Asset pledged as collateral | Federal Home Loan Bank Advances
Debt Instrument [Line Items]
Maximum borrowing capacity			214,000,000	214,300,000
Federal Home Loan Bank Advances | Multifamily loans | Asset pledged as collateral | Federal Home Loan Bank Advances
Debt Instrument [Line Items]
Maximum borrowing capacity			571,200,000	514,800,000
Federal Reserve and correspondent banks
Debt Instrument [Line Items]
Maximum borrowing capacity			760,800,000	718,600,000
Line of credit			$ 0	0
Subordinated Debt | Fixed Floating Rate Subordinated Notes Due 2032
Debt Instrument [Line Items]
Aggregate principal amount	$ 200,000,000
Interest rate	3.875%		3.875%
Basis spread on variable rate	1.965%
Unamortized discount (premium) and debt issuance costs, net	$ 3,100,000
Subordinated Debt | Fixed Floating Rate Subordinated Notes Due 2029
Debt Instrument [Line Items]
Interest rate		4.25%	4.25%
Basis spread on variable rate		2.62%
Unamortized discount (premium) and debt issuance costs, net		$ 2,900,000
Long-term borrowings		$ 175,000,000
Subordinated Debt | Fixed Floating Rate Subordinated Notes Due 2029 | Spread Adjustment
Debt Instrument [Line Items]
Basis spread on variable rate		0.00263%
Retail Repurchase Agreements
Debt Instrument [Line Items]
Long-term debt			$ 74,500,000	62,000,000
Federal Funds Purchased
Debt Instrument [Line Items]
Long-term debt			$ 0	$ 260,000,000

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BORROWINGS - Schedule of Subordinated Debt (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022	Mar. 15, 2022	Nov. 05, 2019
Subordinated Borrowing [Line Items]
Long-term borrowings	$ 370,504	$ 370,205
Subordinated Debt
Subordinated Borrowing [Line Items]
Subordinated debt, gross	375,000	375,000
Less: Debt issuance costs	(4,496)	(4,795)
Subordinated Debt | Fixed Floating Rate Subordinated Notes Due 2032
Subordinated Borrowing [Line Items]
Subordinated debt, gross	$ 200,000	200,000
Interest rate	3.875%		3.875%
Subordinated Debt | Fixed Floating Rate Subordinated Notes Due 2029
Subordinated Borrowing [Line Items]
Subordinated debt, gross	$ 175,000	$ 175,000
Long-term borrowings				$ 175,000
Interest rate	4.25%			4.25%

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STOCKHOLDERS' EQUITY - Narrative (Details) - Repurchase Plan 2022 - Common Stock - USD ($) $ / shares in Units, $ in Millions	3 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022	Mar. 30, 2022
Equity [Line Items]
Value of stock authorized for repurchase			$ 50.0
Stock repurchased (in shares)	0	625,710
Common stock repurchased, average price (in dollars per share)		$ 39.93
Stock repurchased and retired		$ 25.0
Remaining value of stock authorized for repurchase	$ 25.0

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SHARE BASED COMPENSATION - Narrative (Details)	3 Months Ended		6 Months Ended
	Jun. 30, 2023 USD ($) director shares	Jun. 30, 2022 USD ($)	Jun. 30, 2023 USD ($) director shares	Jun. 30, 2022 USD ($)	May 06, 2015 shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of directors | director	3		3
2015 Omnibus Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares authorized (in shares)					1,500,000
Shares available for issuance (in shares)	367,726		367,726
Expiration period			10 years
2015 Omnibus Incentive Plan | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise period			7 years
2015 Omnibus Incentive Plan | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise period			10 years
2015 Omnibus Incentive Plan | Stock Options and Restricted Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Recognized compensation expense | $	$ 2,700,000	$ 3,200,000	$ 4,000,000	$ 4,700,000
2015 Omnibus Incentive Plan | Stock Option
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense | $	0		$ 0
2015 Omnibus Incentive Plan | Stock Option | Common Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)			0
2015 Omnibus Incentive Plan | Restricted shares, Restricted stock units and Performance share units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense | $	$ 9,500,000		$ 9,500,000
Expected cost recognition weighted average period			2 years 14 days
Shares issued (in shares)			276,252
2015 Omnibus Incentive Plan | Performance Shares | Tranche one
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares issued (in shares)			62,124
Performance period			3 years
2015 Omnibus Incentive Plan | Time Based Shares | Tranche two
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares issued (in shares)			214,128
Vesting period			3 years

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SHARE BASED COMPENSATION - Summary of Activity Restricted Stock (Details) - Restricted Stock	6 Months Ended
	Jun. 30, 2023 $ / shares shares
Number of Common Shares/Units
Nonvested beginning balance (in shares) | shares	389,475
Granted (in shares) | shares	276,252
Vested (in shares) | shares	(201,244)
Forfeited/ cancelled (in shares) | shares	(6,134)
Nonvested ending balance (in shares) | shares	458,349
Weighted Average Grant-Date Fair Value
Nonvested beginning balance (in dollars per share) | $ / shares	$ 37.44
Granted (in dollars per share) | $ / shares	27.06
Vested (in dollars per share) | $ / shares	33.40
Forfeited/ cancelled (in dollars per share) | $ / shares	33.97
Nonvested ending balance (in dollars per share) | $ / shares	$ 32.99

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SHARE BASED COMPENSATION - Summary of Share Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Number of Common Shares
Beginning balance (in shares)			144,047
Granted (in shares)			0
Exercised (in shares)	(33,391)	(1,464)	(40,921)	(10,361)
Forfeited (in shares)			0
Expired (in shares)			(3,338)
Ending balance (in shares)	99,788		99,788		144,047
Exercisable at end of period (in shares)	99,788		99,788
Weighted Average Exercise Share Price
Beginning balance (in dollars per share)			$ 16.61
Granted (in dollars per share)			0
Exercised (in dollars per share)			12.65
Forfeited (in dollars per share)			0
Expired (in dollars per share)			27.46
Ending balance (in dollars per share)	$ 17.87		17.87		$ 16.61
Exercisable at end of period (in dollars per share)	$ 17.87		$ 17.87
Weighted Average Contractual Remaining Life (Years)
Balance at end of period			1 year 4 months 24 days		1 year 7 months 6 days
Exercisable at end of period			1 year 4 months 24 days
Aggregate Intrinsic Value (in thousands)
Beginning balance			$ 2,633
Exercised			474
Ending balance	$ 804		804		$ 2,633
Exercisable at end of period	$ 804		$ 804

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PENSION PLAN - Net Periodic Benefit Cost (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Retirement Benefits [Abstract]
Interest cost on projected benefit obligation	$ 437	$ 326	$ 875	$ 651
Expected return on plan assets	(373)	(352)	(746)	(705)
Recognized net actuarial loss	226	195	451	391
Net periodic benefit cost	$ 290	$ 169	$ 580	$ 337

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PENSION PLAN - Narrative (Details)	6 Months Ended
	Jun. 30, 2023 USD ($)
Retirement Benefits [Abstract]
Contributions by employer	$ 0

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NET INCOME PER COMMON SHARE - Calculation of Net Income per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Earnings Per Share [Abstract]
Net income	$ 24,745	$ 54,800	$ 75,998	$ 98,735
Distributed and undistributed earnings allocated to participating securities	(33)	(194)	(177)	(476)
Net income attributable to common shareholders	$ 24,712	$ 54,606	$ 75,821	$ 98,259
Total weighted average outstanding shares (in shares)	44,894	45,184	44,860	45,303
Less: Weighted average participating securities (in shares)	(61)	(160)	(104)	(221)
Basic weighted average common shares (in shares)	44,833	45,024	44,756	45,082
Dilutive weighted average common stock equivalents (in shares)	56	87	121	140
Diluted weighted average common shares (in shares)	44,889	45,111	44,877	45,222
Basic net income per common share (in dollars per share)	$ 0.55	$ 1.21	$ 1.69	$ 2.18
Diluted net income per common share (in dollars per share)	$ 0.55	$ 1.21	$ 1.69	$ 2.17
Anti-dilutive shares (in shares)	93	0	30	0

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ACCUMULATED OTHER COMPREHENSIVE LOSS - Net Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance at beginning of period	$ 1,536,865	$ 1,488,910	$ 1,483,768	$ 1,519,679
Other comprehensive loss before reclassification from accumulated other comprehensive loss, net of tax			5,347
Reclassifications from accumulated other comprehensive loss to earnings, net of tax			979
Total other comprehensive income/ (loss)	(9,634)	(28,182)	6,326	(88,914)
Balance at end of period	1,539,032	1,477,169	1,539,032	1,477,169
Total
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance at beginning of period	(115,991)	(69,271)	(131,951)	(8,539)
Other comprehensive loss before reclassification from accumulated other comprehensive loss, net of tax				(90,005)
Reclassifications from accumulated other comprehensive loss to earnings, net of tax				1,091
Total other comprehensive income/ (loss)	(9,634)	(28,182)	6,326	(88,914)
Balance at end of period	(125,625)	(97,453)	(125,625)	(97,453)
Unrealized Gains/(Losses) on Debt Securities Available-for-Sale
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance at beginning of period			(113,513)	(336)
Other comprehensive loss before reclassification from accumulated other comprehensive loss, net of tax			5,347	(77,922)
Reclassifications from accumulated other comprehensive loss to earnings, net of tax			0	(34)
Total other comprehensive income/ (loss)			5,347	(77,956)
Balance at end of period	(108,166)	(78,292)	(108,166)	(78,292)
Defined Benefit Pension Plan
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance at beginning of period			(8,002)	(8,203)
Other comprehensive loss before reclassification from accumulated other comprehensive loss, net of tax			0	0
Reclassifications from accumulated other comprehensive loss to earnings, net of tax			336	291
Total other comprehensive income/ (loss)			336	291
Balance at end of period	(7,666)	(7,912)	(7,666)	(7,912)
Unrealized Losses on Debt Securities Transferred from Available-for-Sale to Held-to-Maturity
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance at beginning of period			(10,436)	0
Other comprehensive loss before reclassification from accumulated other comprehensive loss, net of tax			0	(12,083)
Reclassifications from accumulated other comprehensive loss to earnings, net of tax			643	834
Total other comprehensive income/ (loss)			643	(11,249)
Balance at end of period	$ (9,793)	$ (11,249)	$ (9,793)	$ (11,249)

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ACCUMULATED OTHER COMPREHENSIVE LOSS - Reclassification Adjustments Out of Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Accumulated Other Comprehensive Income (Loss) [Line Items]
Investment securities gains	$ 0	$ 38	$ 0	$ 46
Interest and dividends on investment securities	158,150	113,909	309,497	219,945
Recognized actuarial loss	226	195	451	391
Income (loss) before taxes	33,456	73,158	101,940	131,422
Tax expense (benefit)	(8,711)	(18,358)	(25,942)	(32,687)
Net income	$ 24,745	$ 54,800	75,998	98,735
Unrealized Gains/(Losses) on Debt Securities Available-for-Sale | Reclassification out of Accumulated Other Comprehensive Income
Accumulated Other Comprehensive Income (Loss) [Line Items]
Investment securities gains			0	46
Income (loss) before taxes			0	46
Tax expense (benefit)			0	(12)
Net income			0	34
Unrealized Losses on Debt Securities Transferred from Available-for-Sale to Held-to-Maturity | Reclassification out of Accumulated Other Comprehensive Income
Accumulated Other Comprehensive Income (Loss) [Line Items]
Interest and dividends on investment securities			(863)	(1,122)
Income (loss) before taxes			(863)	(1,122)
Tax expense (benefit)			220	288
Net income			(643)	(834)
Accumulated Defined Benefit Plans Adjustment, Net Gain (Loss) Attributable to Parent | Reclassification out of Accumulated Other Comprehensive Income
Accumulated Other Comprehensive Income (Loss) [Line Items]
Recognized actuarial loss			(451)	(391)
Defined Benefit Pension Plan | Reclassification out of Accumulated Other Comprehensive Income
Accumulated Other Comprehensive Income (Loss) [Line Items]
Income (loss) before taxes			(451)	(391)
Tax expense (benefit)			115	100
Net income			$ (336)	$ (291)

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LEASES - Narrative (Details) $ in Millions	Jun. 30, 2023 USD ($) lease
Lessee, Lease, Description [Line Items]
Number of operating leases not yet commenced | lease	1
Right-of-use asset related to lease not yet commenced	$ 0.7
Liability related to lease not yet commenced	$ 0.7
Minimum
Lessee, Lease, Description [Line Items]
Renewal term	1 year
Maximum
Lessee, Lease, Description [Line Items]
Renewal term	20 years

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LEASES - Summary of Leases (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Components of lease expense:
Operating lease cost (resulting from lease payments)	$ 2,712	$ 2,738	$ 5,427	$ 5,504
Supplemental cash flow information related to leases:
Operating cash flows from operating leases	2,861	2,893	5,749	5,832
ROU assets obtained in the exchange for lease liabilities due to new leases and acquisitions	0	0	703	0
Supplemental balance sheet information related to leases:
Operating lease ROU assets	50,397		50,397		$ 48,910
Operating lease liabilities	$ 58,568		$ 58,568		$ 57,402
Operating lease, right-of-use asset, statement of financial position	Other assets		Other assets		Other assets
Operating lease, liability, statement of financial position	Accrued interest payable and other liabilities		Accrued interest payable and other liabilities		Accrued interest payable and other liabilities
Other information related to leases:
Weighted average remaining lease term of operating leases	8 years 3 months 18 days		8 years 3 months 18 days		8 years 7 months 6 days
Weighted average discount rate of operating leases	3.22%		3.22%		3.02%
Revere Bank And RPJ
Supplemental cash flow information related to leases:
ROU assets obtained in the exchange for lease liabilities due to new leases and acquisitions	$ 0	$ 0	$ 0	$ 0

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LEASES - Maturities of Operating Lease Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Lessee, Operating Lease, Liability, Payment, Due [Abstract]
Remaining 2023	$ 5,740
2024	10,751
2025	9,068
2026	8,320
2027	6,922
Thereafter	26,824
Total undiscounted lease payments	67,625
Less: Present value discount	(9,057)
Lease liability	$ 58,568	$ 57,402

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DERIVATIVES - Narrative (Details) - USD ($) $ in Millions	Jun. 30, 2023	Dec. 31, 2022
Commercial Loan | Not Designated as Hedging Instrument | Interest rate swap agreements
Derivative [Line Items]
Notional amount	$ 334.5	$ 339.1

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FAIR VALUE - Financial Assets and Liabilities at Dates Indicated that were Accounted for at Fair Value (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments available-for-sale	$ 1,143,688	$ 1,214,538
Residential mortgage loans held for sale (at fair value)	21,476	11,706
Residential mortgage loans held for sale
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Residential mortgage loans held for sale (at fair value)	21,700	11,300
U.S. treasuries and government agencies
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments available-for-sale	94,345	93,622
State and municipal
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments available-for-sale	268,251	265,997
Mortgage-backed and asset-backed
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments available-for-sale	781,092	854,919
Fair Value, Recurring
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments available-for-sale	1,143,688	1,214,538
Total assets	1,183,450	1,244,840
Total liabilities	(18,286)	(18,596)
Fair Value, Recurring | Residential mortgage loans held for sale
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Residential mortgage loans held for sale	21,476	11,706
Fair Value, Recurring | U.S. treasuries and government agencies
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments available-for-sale	94,345	93,622
Fair Value, Recurring | State and municipal
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments available-for-sale	268,251	265,997
Fair Value, Recurring | Mortgage-backed and asset-backed
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments available-for-sale	781,092	854,919
Fair Value, Recurring | Interest rate swap agreements
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Interest rate swap agreements	18,286	18,596
Interest rate swap agreements	(18,286)	(18,596)
Fair Value, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments available-for-sale	0	0
Total assets	0	0
Total liabilities	0	0
Fair Value, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Residential mortgage loans held for sale
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Residential mortgage loans held for sale	0	0
Fair Value, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | U.S. treasuries and government agencies
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments available-for-sale	0	0
Fair Value, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | State and municipal
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments available-for-sale	0	0
Fair Value, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Mortgage-backed and asset-backed
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments available-for-sale	0	0
Fair Value, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Interest rate swap agreements
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Interest rate swap agreements	0	0
Interest rate swap agreements	0	0
Fair Value, Recurring | Significant Other Observable Inputs (Level 2)
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments available-for-sale	1,143,688	1,214,538
Total assets	1,183,450	1,244,840
Total liabilities	(18,286)	(18,596)
Fair Value, Recurring | Significant Other Observable Inputs (Level 2) | Residential mortgage loans held for sale
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Residential mortgage loans held for sale	21,476	11,706
Fair Value, Recurring | Significant Other Observable Inputs (Level 2) | U.S. treasuries and government agencies
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments available-for-sale	94,345	93,622
Fair Value, Recurring | Significant Other Observable Inputs (Level 2) | State and municipal
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments available-for-sale	268,251	265,997
Fair Value, Recurring | Significant Other Observable Inputs (Level 2) | Mortgage-backed and asset-backed
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments available-for-sale	781,092	854,919
Fair Value, Recurring | Significant Other Observable Inputs (Level 2) | Interest rate swap agreements
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Interest rate swap agreements	18,286	18,596
Interest rate swap agreements	(18,286)	(18,596)
Fair Value, Recurring | Significant Unobservable Inputs (Level 3)
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments available-for-sale	0	0
Total assets	0	0
Total liabilities	0	0
Fair Value, Recurring | Significant Unobservable Inputs (Level 3) | Residential mortgage loans held for sale
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Residential mortgage loans held for sale	0	0
Fair Value, Recurring | Significant Unobservable Inputs (Level 3) | U.S. treasuries and government agencies
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments available-for-sale	0	0
Fair Value, Recurring | Significant Unobservable Inputs (Level 3) | State and municipal
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments available-for-sale	0	0
Fair Value, Recurring | Significant Unobservable Inputs (Level 3) | Mortgage-backed and asset-backed
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Investments available-for-sale	0	0
Fair Value, Recurring | Significant Unobservable Inputs (Level 3) | Interest rate swap agreements
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Interest rate swap agreements	0	0
Interest rate swap agreements	$ 0	$ 0

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FAIR VALUE - Assets Measured at Fair Value on Nonrecurring Basis (Details) - Fair Value, Nonrecurring - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	$ 611	$ 835
Total Losses	(104)	(489)
Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	0	190
Total Losses	0	(384)
Other real estate owned
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	611	645
Total Losses	(104)	(105)
Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Other real estate owned
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	0	0
Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	0	0
Significant Other Observable Inputs (Level 2) | Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	0	0
Significant Other Observable Inputs (Level 2) | Other real estate owned
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	0	0
Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	611	835
Significant Unobservable Inputs (Level 3) | Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	0	190
Significant Unobservable Inputs (Level 3) | Other real estate owned
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	$ 611	$ 645

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FAIR VALUE - Narrative (Details) - USD ($) $ in Millions	Jun. 30, 2023	Dec. 31, 2022
Fair Value Disclosures [Abstract]
Balance of loans individually evaluated for credit loss	$ 63.5	$ 26.2
Loans receivable, fair value	47.3	19.3
Allowance related to loans evaluated individually	$ 16.2	$ 6.9

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FAIR VALUE - Carrying Amounts and Fair Values of Company's Financial Instruments (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Financial assets:
Residential mortgage loans held for sale	$ 21,476	$ 11,706
Investments available-for-sale	1,143,688	1,214,538
Held-to-maturity debt securities	208,662	220,123
Loans, net of allowance	11,249,352	11,260,464
Accrued interest receivable	42,388	41,172
Financial liabilities:
Other deposits	10,958,922	10,953,421
Advances from FHLB	600,000	550,000
Subordinated debt	370,504	370,205
Carrying Amount
Financial assets:
Cash and cash equivalents	430,127	192,232
Residential mortgage loans held for sale	21,476	11,706
Investments available-for-sale	1,143,688	1,214,538
Held-to-maturity debt securities	247,814	259,452
Other investments	72,052	69,218
Loans, net of allowance	11,249,352	11,260,464
Interest rate swap agreements	18,286	18,596
Accrued interest receivable	42,388	41,172
Bank owned life insurance	156,874	153,016
Financial liabilities:
Time deposits	2,815,761	2,118,262
Other deposits	8,143,161	8,835,159
Federal Funds Purchased and Securities Sold under Agreements to Repurchase	374,510	321,967
Advances from FHLB	600,000	550,000
Subordinated debt	370,504	370,205
Interest rate swap agreements	18,286	18,596
Accrued interest payable	24,436	10,867
Estimated Fair Value
Financial assets:
Cash and cash equivalents	430,127	192,232
Residential mortgage loans held for sale	21,476	11,706
Investments available-for-sale	1,143,688	1,214,538
Held-to-maturity debt securities	208,662	220,123
Other investments	72,052	69,218
Loans, net of allowance	10,467,917	11,020,992
Interest rate swap agreements	18,286	18,596
Accrued interest receivable	42,388	41,172
Bank owned life insurance	156,874	153,016
Financial liabilities:
Time deposits	2,786,157	2,082,319
Other deposits	8,143,161	8,835,159
Federal Funds Purchased and Securities Sold under Agreements to Repurchase	374,510	321,967
Advances from FHLB	591,850	549,530
Subordinated debt	336,107	332,470
Interest rate swap agreements	18,286	18,596
Accrued interest payable	24,436	10,867
Quoted Prices in Active Markets for Identical Assets (Level 1) | Estimated Fair Value
Financial assets:
Cash and cash equivalents	430,127	192,232
Residential mortgage loans held for sale	0	0
Investments available-for-sale	0	0
Held-to-maturity debt securities	0	0
Other investments	0	0
Loans, net of allowance	0	0
Interest rate swap agreements	0	0
Accrued interest receivable	42,388	41,172
Bank owned life insurance	0	0
Financial liabilities:
Time deposits	0	0
Other deposits	8,143,161	8,835,159
Federal Funds Purchased and Securities Sold under Agreements to Repurchase	0	0
Advances from FHLB	0	0
Subordinated debt	0	0
Interest rate swap agreements	0	0
Accrued interest payable	24,436	10,867
Significant Other Observable Inputs (Level 2) | Estimated Fair Value
Financial assets:
Cash and cash equivalents	0	0
Residential mortgage loans held for sale	21,476	11,706
Investments available-for-sale	1,143,688	1,214,538
Held-to-maturity debt securities	208,662	220,123
Other investments	72,052	69,218
Loans, net of allowance	0	0
Interest rate swap agreements	18,286	18,596
Accrued interest receivable	0	0
Bank owned life insurance	156,874	153,016
Financial liabilities:
Time deposits	2,786,157	2,082,319
Other deposits	0	0
Federal Funds Purchased and Securities Sold under Agreements to Repurchase	374,510	321,967
Advances from FHLB	591,850	549,530
Subordinated debt	0	0
Interest rate swap agreements	18,286	18,596
Accrued interest payable	0	0
Significant Unobservable Inputs (Level 3) | Estimated Fair Value
Financial assets:
Cash and cash equivalents	0	0
Residential mortgage loans held for sale	0	0
Investments available-for-sale	0	0
Held-to-maturity debt securities	0	0
Other investments	0	0
Loans, net of allowance	10,467,917	11,020,992
Interest rate swap agreements	0	0
Accrued interest receivable	0	0
Bank owned life insurance	0	0
Financial liabilities:
Time deposits	0	0
Other deposits	0	0
Federal Funds Purchased and Securities Sold under Agreements to Repurchase	0	0
Advances from FHLB	0	0
Subordinated debt	336,107	332,470
Interest rate swap agreements	0	0
Accrued interest payable	$ 0	$ 0