Debt Securities

9 Months Ended

Sep. 30, 2019

Investments, Debt and Equity Securities [Abstract]

The following tables present the amortized cost, the gross unrealized gains and losses and the fair value of the Company’s debt securities:


	September 30, 2019
	Amortized Cost		Gross Unrealized					Fair Value
(Dollars in thousands)				Gains		Losses
Available-for-sale
U.S. government and federal agency	$	147,575	26		(167)		147,434
U.S. government sponsored enterprises	66,072		1,117		—		67,189
State and local governments	588,307		25,558		—		613,865
Corporate bonds	145,528		1,860		(5)		147,383
Residential mortgage-backed securities	762,415		5,662		(824)		767,253
Commercial mortgage-backed securities	684,720		31,375		(183)		715,912
Total available-for-sale	2,394,617		65,598		(1,179)		2,459,036
Held-to-maturity
State and local governments	234,992		10,567		—		245,559
Total held-to-maturity	234,992		10,567		—		245,559
Total debt securities	$	2,629,609	76,165		(1,179)		2,704,595


	December 31, 2018
	Amortized Cost		Gross Unrealized					Fair Value
(Dollars in thousands)				Gains		Losses
Available-for-sale
U.S. government and federal agency	$	23,757	54		(162)		23,649
U.S. government sponsored enterprises	120,670		52		(514)		120,208
State and local governments	844,636		18,936		(11,322)		852,250
Corporate bonds	292,052		378		(1,613)		290,817
Residential mortgage-backed securities	808,537		628		(16,250)		792,915
Commercial mortgage-backed securities	490,868		3,312		(2,356)		491,824
Total available-for-sale	2,580,520		23,360		(32,217)		2,571,663
Held-to-maturity
State and local governments	297,915		1,380		(11,039)		288,256
Total held-to-maturity	297,915		1,380		(11,039)		288,256
Total debt securities	$	2,878,435	24,740		(43,256)		2,859,919

The following table presents the amortized cost and fair value of available-for-sale and held-to-maturity debt securities by contractual maturity at September 30, 2019. Actual maturities may differ from expected or contractual maturities since issuers have the right to prepay obligations with or without prepayment penalties.


	September 30, 2019
	Available-for-Sale				Held-to-Maturity
(Dollars in thousands)	Amortized Cost		Fair Value	Amortized Cost	Fair Value
Due within one year	$	160,855	160,980	—	—
Due after one year through five years	209,725		213,094	10,204	10,580
Due after five years through ten years	215,297		224,814	75,545	79,647
Due after ten years	361,605		376,983	149,243	155,332
	947,482		975,871	234,992	245,559
Mortgage-backed securities ¹	1,447,135		1,483,165	—	—
Total	$	2,394,617	2,459,036	234,992	245,559

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¹ Mortgage-backed securities, which have prepayment provisions, are not assigned to maturity categories due to fluctuations in their prepayment speeds.

Proceeds from sales and calls of debt securities and the associated gains and losses that have been included in earnings are listed below:


	Three Months ended				Nine Months ended
(Dollars in thousands)	September 30, 2019		September 30, 2018	September 30, 2019	September 30, 2018
Available-for-sale
Proceeds from sales and calls of debt securities	$	401,701	12,135	878,072	245,581
Gross realized gains ¹	14,329		188	18,613	203
Gross realized losses ¹	(518)		(37)	(4,447)	(398)
Held-to-maturity
Proceeds from calls of debt securities	16,365		28,435	48,940	57,370
Gross realized gains ¹	—		12	2	76
Gross realized losses ¹	—		(530)	(10)	(637)

______________________________

¹ The gain or loss on the sale or call of each debt security is determined by the specific identification method.

Debt securities with an unrealized loss position are summarized as follows:


	September 30, 2019
	Less than 12 Months				12 Months or More			Total
(Dollars in thousands)	Fair Value		Unrealized Loss	Fair Value	Unrealized Loss	Fair Value	Unrealized Loss
Available-for-sale
U.S. government and federal agency	$	129,520	(89)	9,440	(78)	138,960	(167)


Corporate bonds	6,786		(5)	—	—	6,786	(5)
Residential mortgage-backed securities	144,444		(380)	36,324	(444)	180,768	(824)
Commercial mortgage-backed securities	9,925		(115)	7,754	(68)	17,679	(183)
Total available-for-sale	$	290,675	(589)	53,518	(590)	344,193	(1,179)


	December 31, 2018
	Less than 12 Months				12 Months or More			Total
(Dollars in thousands)	Fair Value		Unrealized Loss	Fair Value	Unrealized Loss	Fair Value	Unrealized Loss
Available-for-sale
U.S. government and federal agency	$	4,287	(27)	10,519	(135)	14,806	(162)
U.S. government sponsored enterprises	43,400		(103)	35,544	(411)	78,944	(514)
State and local governments	72,080		(922)	232,244	(10,400)	304,324	(11,322)
Corporate bonds	119,111		(937)	114,800	(676)	233,911	(1,613)
Residential mortgage-backed securities	132,405		(833)	537,202	(15,417)	669,607	(16,250)
Commercial mortgage-backed securities	73,118		(402)	86,504	(1,954)	159,622	(2,356)
Total available-for-sale	$	444,401	(3,224)	1,016,813	(28,993)	1,461,214	(32,217)
Held-to-maturity
State and local governments	$	87,392	(2,778)	126,226	(8,261)	213,618	(11,039)
Total held-to-maturity	$	87,392	(2,778)	126,226	(8,261)	213,618	(11,039)

Based on an analysis of its debt securities with unrealized losses as of September 30, 2019 and December 31, 2018, the Company determined that none of such securities had other-than-temporary impairment and the unrealized losses were primarily the result of interest rate changes and market spreads subsequent to acquisition. The fair value of the debt securities is expected to recover as payments are received and the securities approach maturity. At September 30, 2019, management determined that it did not intend to sell debt securities with unrealized losses, and there was no expected requirement to sell any of its debt securities with unrealized losses before recovery of their amortized cost.