
	September 30, 2020
(Dollars in thousands)	Amortized Cost		Gross Unrealized Gains	Gross Unrealized Losses	Fair Value
Available-for-sale
U.S. government and federal agency	$	40,082	297	(239)	40,140
U.S. government sponsored enterprises	9,767		58	—	9,825
State and local governments	1,192,905		82,509	(38)	1,275,376
Corporate bonds	347,400		13,647	(23)	361,024
Residential mortgage-backed securities	1,255,016		21,551	(709)	1,275,858
Commercial mortgage-backed securities	1,104,252		59,075	(2)	1,163,325
Total available-for-sale	$	3,949,422	177,137	(1,011)	4,125,548
Held-to-maturity
State and local governments	$	193,509	13,068	—	206,577
Total held-to-maturity	$	193,509	13,068	—	206,577


	December 31, 2019
(Dollars in thousands)	Amortized Cost		Gross Unrealized Gains	Gross Unrealized Losses	Fair Value
Available-for-sale
U.S. government and federal agency	$	20,061	48	(65)	20,044
U.S. government sponsored enterprises	42,724		953	—	43,677
State and local governments	679,784		22,694	(80)	702,398
Corporate bonds	155,665		1,938	(1)	157,602
Residential mortgage-backed securities	731,766		7,507	(549)	738,724
Commercial mortgage-backed securities	891,374		22,825	(1,392)	912,807
Total available-for-sale	$	2,521,374	55,965	(2,087)	2,575,252
Held-to-maturity
State and local governments	$	224,611	9,785	—	234,396
Total held-to-maturity	$	224,611	9,785	—	234,396

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, 2020. Actual maturities may differ from expected or contractual maturities since some issuers have the right to prepay obligations with or without prepayment penalties.


	September 30, 2020
	Available-for-Sale			Held-to-Maturity
(Dollars in thousands)	Amortized Cost		Fair Value	Amortized Cost	Fair Value
Due within one year	$	119,874	121,303	—	—
Due after one year through five years	264,927		277,758	19,543	20,996
Due after five years through ten years	263,208		277,022	69,924	75,680
Due after ten years	942,145		1,010,282	104,042	109,901
	1,590,154		1,686,365	193,509	206,577
Mortgage-backed securities 1	2,359,268		2,439,183	—	—
Total	$	3,949,422	4,125,548	193,509	206,577


	Three Months ended			Nine Months ended
(Dollars in thousands)	September 30, 2020		September 30, 2019	September 30, 2020	September 30, 2019
Available-for-sale
Proceeds from sales and calls of debt securities	$	69,304	401,701	184,088	878,072
Gross realized gains 1	102		14,329	1,206	18,613
Gross realized losses 1	(78)		(518)	(192)	(4,447)
Held-to-maturity
Proceeds from calls of debt securities	9,280		16,365	29,530	48,940
Gross realized gains 1	—		—	1	2
Gross realized losses 1	—		—	—	(10)

In assessing whether a credit loss existed on available-for-sale debt securities with unrealized losses, the Company compared the present value of cash flows expected to be collected from the debt securities with the amortized cost basis of the debt securities. In addition, the following factors were evaluated individually and collectively in determining the existence of expected credit losses:

•the overall deal and payment structure of the debt securities, including the investor entity’s position within the structure, underlying obligors, financial condition and near-term prospects of the issuer, including specific events which may affect the issuer’s operations or future earnings, and credit support or enhancements; and

The following table summarizes available-for-sale debt securities that were in an unrealized loss position for which an ACL has not been recorded, based on the length of time the individual securities have been in an unrealized loss position. The number of available-for-sale debt securities in an unrealized position is also disclosed.


	September 30, 2020
	Number of Securities	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	19	$	13,656	(230)	663	(9)	14,319	(239)

State and local governments	11	5,383		(38)	—	—	5,383	(38)
Corporate bonds	6	11,029		(23)	—	—	11,029	(23)
Residential mortgage-backed securities	28	282,912		(709)	27	—	282,939	(709)
Commercial mortgage-backed securities	1	11,035		(2)	—	—	11,035	(2)
Total available-for-sale	65	$	324,015	(1,002)	690	(9)	324,705	(1,011)


	December 31, 2019
	Number of Securities	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	20	$	464	—	9,902	(65)	10,366	(65)

State and local governments	12	19,044		(80)	—	—	19,044	(80)
Corporate bonds	2	7,378		(1)	—	—	7,378	(1)
Residential mortgage-backed securities	35	85,562		(234)	29,038	(315)	114,600	(549)
Commercial mortgage-backed securities	19	177,051		(1,293)	7,697	(99)	184,748	(1,392)
Total available-for-sale	88	$	289,499	(1,608)	46,637	(479)	336,136	(2,087)

With respect to severity, the majority of available-for-sale debt securities with unrealized loss positions at September 30, 2020 have unrealized losses as a percentage of book value of less than five percent. A substantial portion of such securities were issued by Federal National Mortgage Association (“Fannie Mae”), Federal Home Loan Mortgage Corporation (“Freddie Mac”), Government National Mortgage Association (“Ginnie Mae”) and other agencies of the U.S. government or have credit ratings issued by one or more of the NRSRO entities in the four highest credit rating categories. All of the Company’s available-for-sale debt securities with unrealized loss positions at September 30, 2020 have been determined to be investment grade.

As of September 30, 2020, the Company did not have any available-for-sale debt securities past due. Accrued interest receivable on available-for-sale debt securities totaled $23,491,000 at September 30, 2020 and was excluded from the estimate of credit losses.

During the period ended September 30, 2020, the Company acquired available-for-sale debt securities from the secondary market and through the SBAZ acquisition. Such securities were evaluated and it was determined there were no PCD securities, so no allowance for credit losses was recorded.

Based on an analysis of its available-for-sale debt securities with unrealized losses as of September 30, 2020, the Company determined the decline in value was unrelated to credit loss and was primarily the result of changes in interest rates and market spreads subsequent to acquisition. The fair value of the debt securities is expected to recover as payments are received and the debt securities approach maturity. In addition, as of September 30, 2020, management determined it did not intend to sell available-for-sale debt securities with unrealized losses, and there was no expected requirement to sell such securities before recovery of their amortized cost. As a result, no ACL was recorded on available-for-sale debt securities at September 30, 2020. As part of this determination, the Company considered contractual obligations, regulatory constraints, liquidity, capital, asset/liability management and securities portfolio objectives and whether or not any of the Company’s investment securities were managed by third-party investment funds.

The Company measured expected credit losses on held-to-maturity debt securities on a collective basis by major security type and NRSRO credit ratings, which is the Company’s primary credit quality indicator for state and local government securities. The estimate of expected credit losses considered historical credit loss information that was adjusted for current conditions as well as reasonable and supportable forecasts. The following table summarizes the amortized cost of held-to-maturity debt securities aggregated by NRSRO credit rating:


(Dollars in thousands)	September 30, 2020		December 31, 2019
Held-to-maturity
S&P: AAA / Moody’s: Aaa	$	40,735	65,217
S&P: AA+, AA, AA- / Moody’s: Aa1, Aa2, Aa3	125,573		130,316
S&P: A+, A, A- / Moody’s: A1, A2, A3	27,201		28,689

Not rated by either entity	—		389

Total held-to-maturity	$	193,509	224,611

The Company’s held-to-maturity debt securities portfolio is primarily comprised of general obligation and revenue bonds with NRSRO ratings in the four highest credit rating categories. All of the Company’s held-to-maturity debt securities at September 30, 2020 have been determined to be investment grade.

As of September 30, 2020, the Company did not have any held-to-maturity debt securities past due. Accrued interest receivable on held-to-maturity debt securities totaled $2,079,000 at September 30, 2020 and was excluded from the estimate of credit losses.