| Investment Securities |
Investment Securities The following tables are a summary of the investment securities portfolios as of the dates shown: | | | | | | | | | | | | | | | | | | | | | | | | | June 30, 2024 | | (In thousands) | Amortized
Cost | | Gross
Unrealized
Gains | | Gross
Unrealized
Losses | | Fair
Value | | Available-for-sale securities | | | | | | | | | U.S. Treasury | $ | 102,721 | | | $ | 5 | | | $ | (14) | | | $ | 102,712 | | | U.S. government agencies | 50,000 | | | — | | | (4,808) | | | 45,192 | | | Municipal | 151,347 | | | 390 | | | (5,129) | | | 146,608 | | | Corporate notes: | | | | | | | | | Financial issuers | 83,996 | | | — | | | (7,011) | | | 76,985 | | | Other | 1,000 | | | — | | | (10) | | | 990 | | Mortgage-backed: (1) | | | | | | | | | Residential mortgage-backed securities | 4,320,215 | | | 361 | | | (541,742) | | | 3,778,834 | | | Commercial (multi-family) mortgage-backed securities | 18,096 | | | 8 | | | (626) | | | 17,478 | | | Collateralized mortgage obligations | 179,315 | | | 629 | | | (18,786) | | | 161,158 | | | Total available-for-sale securities | $ | 4,906,690 | | | $ | 1,393 | | | $ | (578,126) | | | $ | 4,329,957 | | | Held-to-maturity securities | | | | | | | | | U.S. government agencies | $ | 336,458 | | | $ | — | | | $ | (70,928) | | | $ | 265,530 | | | Municipal | 166,400 | | | 155 | | | (6,789) | | | 159,766 | | Mortgage-backed: (1) | | | | | | | | | Residential mortgage-backed securities | 2,962,721 | | | — | | | (591,601) | | | 2,371,120 | | | Commercial (multi-family) mortgage-backed securities | 6,390 | | | — | | | (300) | | | 6,090 | | | Collateralized mortgage obligations | 227,247 | | | 362 | | | (23,636) | | | 203,973 | | | Corporate notes | 57,199 | | | — | | | (3,211) | | | 53,988 | | | Total held-to-maturity securities | $ | 3,756,415 | | | $ | 517 | | | $ | (696,465) | | | $ | 3,060,467 | | | Less: Allowance for credit losses | (491) | | | | | | | | | Held-to-maturity securities, net of allowance for credit losses | $ | 3,755,924 | | | | | | | | | Equity securities with readily determinable fair value | $ | 117,674 | | | $ | 2,882 | | | $ | (8,383) | | | $ | 112,173 | |
(1)None of our mortgage-backed securities are subprime. | | | | | | | | | | | | | | | | | | | | | | | | | December 31, 2023 | | Amortized
Cost | | Gross
Unrealized
Gains | | Gross
Unrealized
Losses | | Fair
Value | | (In thousands) | | | | | Available-for-sale securities | | | | | | | | | U.S. Treasury | $ | 6,960 | | | $ | 8 | | | $ | — | | | $ | 6,968 | | | U.S. government agencies | 50,000 | | | — | | | (4,876) | | | 45,124 | | | Municipal | 144,299 | | | 657 | | | (3,998) | | | 140,958 | | | Corporate notes: | | | | | | | | | Financial issuers | 83,996 | | | — | | | (8,456) | | | 75,540 | | | Other | 1,000 | | | — | | | (9) | | | 991 | | Mortgage-backed: (1) | | | | | | | | | Residential Mortgage-backed securities | 3,505,012 | | | 1,392 | | | (446,784) | | | 3,059,620 | | | Commercial (multi-family) mortgage-backed securities | 13,201 | | | 68 | | | (289) | | | 12,980 | | | Collateralized mortgage obligations | 175,346 | | | 1,400 | | | (16,012) | | | 160,734 | | | Total available-for-sale securities | $ | 3,979,814 | | | $ | 3,525 | | | $ | (480,424) | | | $ | 3,502,915 | | | Held-to-maturity securities | | | | | | | | | U.S. government agencies | $ | 336,468 | | | $ | — | | | $ | (67,058) | | | $ | 269,410 | | | Municipal | 172,933 | | | 565 | | | (3,778) | | | 169,720 | | Mortgage-backed: (1) | | | | | | | | | Residential Mortgage-backed securities | 3,042,828 | | | 1,922 | | | (549,265) | | | 2,495,485 | | | Commercial (multi-family) mortgage-backed securities | 6,415 | | | — | | | (184) | | | 6,231 | | | Collateralized mortgage obligations | 241,075 | | | 978 | | | (21,502) | | | 220,551 | | | Corporate notes | 57,544 | | | 7 | | | (3,480) | | | 54,071 | | | Total held-to-maturity securities | $ | 3,857,263 | | | $ | 3,472 | | | $ | (645,267) | | | $ | 3,215,468 | | | Less: Allowance for credit losses | (347) | | | | | | | | | Held-to-maturity securities, net of allowance for credit losses | $ | 3,856,916 | | | | | | | | | Equity securities with readily determinable fair value | $ | 143,312 | | | $ | 3,500 | | | $ | (7,544) | | | $ | 139,268 | |
(1)None of our mortgage-backed securities are subprime. | | | | | | | | | | | | | | | | | | | | | | | | | June 30, 2023 | | Amortized
Cost | | Gross
Unrealized
Gains | | Gross
Unrealized
Losses | | Fair
Value | | (In thousands) | | | | | Available-for-sale securities | | | | | | | | | U.S. Treasury | $ | — | | | $ | — | | | $ | — | | | $ | — | | | U.S. government agencies | 80,000 | | | — | | | (5,725) | | | 74,275 | | | Municipal | 173,540 | | | 102 | | | (6,231) | | | 167,411 | | | Corporate notes: | | | | | | | | | Financial issuers | 83,995 | | | — | | | (12,920) | | | 71,075 | | | Other | 1,000 | | | — | | | (15) | | | 985 | | Mortgage-backed: (1) | | | | | | | | | Mortgage-backed securities | 3,585,943 | | | — | | | (483,659) | | | 3,102,284 | | | Collateralized mortgage obligations | 94,373 | | | — | | | (17,922) | | | 76,451 | | | Total available-for-sale securities | $ | 4,018,851 | | | $ | 102 | | | $ | (526,472) | | | $ | 3,492,481 | | | Held-to-maturity securities | | | | | | | | | U.S. government agencies | $ | 339,604 | | | $ | — | | | $ | (71,022) | | | $ | 268,582 | | | Municipal | 176,128 | | | 362 | | | (4,502) | | | 171,988 | | Mortgage-backed: (1) | | | | | | | | | Mortgage-backed securities | 2,832,138 | | | — | | | (574,114) | | | 2,258,024 | | | Collateralized mortgage obligations | 159,120 | | | — | | | (23,014) | | | 136,106 | | | Corporate notes | 57,889 | | | 35 | | | (4,733) | | | 53,191 | | | Total held-to-maturity securities | $ | 3,564,879 | | | $ | 397 | | | $ | (677,385) | | | $ | 2,887,891 | | | Less: Allowance for credit losses | (406) | | | | | | | | | Held-to-maturity securities, net of allowance for credit losses | $ | 3,564,473 | | | | | | | | | Equity securities with readily determinable fair value | $ | 120,629 | | | $ | 3,711 | | | $ | (8,065) | | | $ | 116,275 | |
(1)Consisting entirely of residential mortgage-backed securities, none of which are subprime.
Equity securities without readily determinable fair values totaled $62.7 million as of June 30, 2024. Equity securities without readily determinable fair values are included as part of accrued interest receivable and other assets in the Company’s Consolidated Statements of Condition. The Company monitors its equity investments without readily determinable fair values to identify potential transactions that may indicate an observable price change in orderly transactions for the identical or a similar investment of the same issuer, requiring adjustment to its carrying amount. During the three and six months ended June 30, 2024 and June 30, 2023, the Company recorded no upward or downward adjustments related to such observable price changes. The Company conducts a quarterly assessment of its equity securities without readily determinable fair values to determine whether impairment exists in such securities, considering, among other factors, the nature of the securities, financial condition of the issuer and expected future cash flows. During the three and six months ended June 30, 2024, the Company recorded $3.7 million of impairment of equity securities without readily determinable fair values. During the three and six months ended June 30, 2023, the Company recorded no impairment of equity securities without readily determinable fair values. The following table presents the portion of the Company’s available-for-sale investment securities portfolios that have gross unrealized losses, reflecting the length of time that individual securities have been in a continuous unrealized loss position at June 30, 2024: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Continuous unrealized
losses existing for
less than 12 months | | Continuous unrealized
losses existing for
greater than 12 months | | Total | | (In thousands) | Fair Value | | Unrealized Losses | | Fair Value | | Unrealized Losses | | Fair Value | | Unrealized Losses | | Available-for-sale securities | | | | | | | | | | | | | U.S. Treasury | $ | 90,735 | | | $ | (14) | | | $ | — | | | $ | — | | | $ | 90,735 | | | $ | (14) | | | U.S. government agencies | — | | | — | | | 45,192 | | | (4,808) | | | 45,192 | | | (4,808) | | | Municipal | 42,560 | | | (333) | | | 78,578 | | | (4,796) | | | 121,138 | | | (5,129) | | | Corporate notes: | | | | | | | | | | | | | Financial issuers | — | | | — | | | 76,985 | | | (7,011) | | | 76,985 | | | (7,011) | | | Other | — | | | — | | | 990 | | | (10) | | | 990 | | | (10) | | Mortgage-backed: (1) | | | | | | | | | | | | | Residential mortgage-backed securities | 1,226,130 | | | (19,491) | | | 2,537,424 | | | (522,251) | | | 3,763,554 | | | (541,742) | | | Commercial (multi-family) mortgage-backed securities | 14,505 | | | (626) | | | — | | | — | | | 14,505 | | | (626) | | | Collateralized mortgage obligations | 16,384 | | | (81) | | | 69,273 | | | (18,705) | | | 85,657 | | | (18,786) | | | Total available-for-sale securities | $ | 1,390,314 | | | $ | (20,545) | | | $ | 2,808,442 | | | $ | (557,581) | | | $ | 4,198,756 | | | $ | (578,126) | |
(1)None of our mortgage-backed securities are subprime.
The Company conducts a regular assessment of its investment securities to determine whether securities are experiencing credit losses. Factors for consideration include the nature of the securities, credit ratings or financial condition of the issuer, the extent of the unrealized loss, expected cash flows, market conditions and the Company’s ability to hold the securities through the anticipated recovery period.
The Company does not consider available-for-sale securities with unrealized losses at June 30, 2024 to be experiencing credit losses and recognized no resulting allowance for credit losses for such individually assessed credit losses. The Company does not intend to sell these investments and it is more likely than not that the Company will not be required to sell these investments before recovery of the amortized cost bases, which may be the maturity dates of the securities. The unrealized losses within each category have occurred as a result of changes in interest rates, market spreads and market conditions subsequent to purchase. Available-for-sale securities with continuous unrealized losses existing for more than twelve months at June 30, 2024 were primarily mortgage-backed securities with unrealized losses due to increased market rates during such period.
See Note (7) “Allowance for Credit Losses” in Item 1 of this report for further discussion regarding any credit losses associated with held-to-maturity securities at June 30, 2024.
The following table provides information as to the amount of gross gains and losses, adjustments and impairment on investment securities recognized in earnings and proceeds received through the sale or call of investment securities: | | | | | | | | | | | | | | | | | | | | | | | | | Three months ended June 30, | | Six months ended June 30, | | (In thousands) | 2024 | | 2023 | | 2024 | | 2023 | | Realized gains on investment securities | $ | 1,325 | | | $ | 6 | | | $ | 2,360 | | | $ | 611 | | | Realized losses on investment securities | (21) | | | (6) | | | (129) | | | (51) | | | Net realized gains on investment securities | 1,304 | | | 0 | | | 2,231 | | | 560 | | | Unrealized gains on equity securities with readily determinable fair value | 74 | | | 684 | | | 1,108 | | | 2,974 | | | Unrealized losses on equity securities with readily determinable fair value | (1,931) | | | (684) | | | (2,564) | | | (2,136) | | | Net unrealized (losses) gains on equity securities with readily determinable fair value | (1,857) | | | 0 | | | (1,456) | | | 838 | | | | | | | | | | | | | | | | | | | Impairment of equity securities without readily determinable fair values | (3,729) | | | — | | | (3,731) | | | — | | | | | | | | | | | (Losses) gains on investment securities, net | $ | (4,282) | | | $ | 0 | | | $ | (2,956) | | | $ | 1,398 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
The amortized cost and fair value of available-for-sale and held-to-maturity investment securities as of June 30, 2024, December 31, 2023 and June 30, 2023, by contractual maturity, are shown in the following table. Contractual maturities may differ from actual maturities as borrowers may have the right to call or repay obligations with or without call or prepayment penalties. Mortgage-backed securities are not included in the maturity categories in the following maturity summary as actual maturities may differ from contractual maturities because the underlying mortgages may be called or prepaid without penalties: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | June 30, 2024 | | December 31, 2023 | | June 30, 2023 | | (In thousands) | Amortized Cost | | Fair Value | | Amortized Cost | | Fair Value | | Amortized Cost | | Fair Value | | Available-for-sale securities | | | | | | | | | | | | | Due in one year or less | $ | 145,856 | | | $ | 145,599 | | | $ | 53,162 | | | $ | 52,945 | | | $ | 93,724 | | | $ | 93,137 | | | Due in one to five years | 139,409 | | | 131,506 | | | 132,348 | | | 123,985 | | | 138,704 | | | 126,776 | | | Due in five to ten years | 84,756 | | | 79,216 | | | 82,040 | | | 76,869 | | | 41,655 | | | 36,315 | | | Due after ten years | 19,043 | | | 16,166 | | | 18,705 | | | 15,782 | | | 64,452 | | | 57,518 | | | Mortgage-backed | 4,517,626 | | | 3,957,470 | | | 3,693,559 | | | 3,233,334 | | | 3,680,316 | | | 3,178,735 | | | Total available-for-sale securities | $ | 4,906,690 | | | $ | 4,329,957 | | | $ | 3,979,814 | | | $ | 3,502,915 | | | $ | 4,018,851 | | | $ | 3,492,481 | | | Held-to-maturity securities | | | | | | | | | | | | | Due in one year or less | $ | 8,356 | | | $ | 8,213 | | | $ | 5,169 | | | $ | 5,142 | | | $ | 2,479 | | | $ | 2,475 | | | Due in one to five years | 114,457 | | | 109,845 | | | 109,602 | | | 105,835 | | | 102,182 | | | 96,806 | | | Due in five to ten years | 85,507 | | | 82,499 | | | 99,700 | | | 98,718 | | | 106,708 | | | 105,054 | | | Due after ten years | 351,737 | | | 278,727 | | | 352,474 | | | 283,506 | | | 362,252 | | | 289,426 | | | Mortgage-backed | 3,196,358 | | | 2,581,183 | | | 3,290,318 | | | 2,722,267 | | | 2,991,258 | | | 2,394,130 | | | Total held-to-maturity securities | $ | 3,756,415 | | | $ | 3,060,467 | | | $ | 3,857,263 | | | $ | 3,215,468 | | | $ | 3,564,879 | | | $ | 2,887,891 | | | Less: Allowance for credit losses | (491) | | | | | (347) | | | | | (406) | | | | | Held-to-maturity securities, net of allowance for credit losses | $ | 3,755,924 | | | | | $ | 3,856,916 | | | | | $ | 3,564,473 | | | | | | | | | | | | | | | |
Securities having a carrying value of $7.6 billion at June 30, 2024 as well as securities having a carrying value of $6.9 billion and $6.4 billion at December 31, 2023 and June 30, 2023, respectively, were pledged as collateral for public deposits, trust deposits, Federal Home Loan Bank (“FHLB”) advances and available lines of credit, securities sold under repurchase agreements and derivatives. At June 30, 2024, there were no securities of a single issuer, other than U.S. government-sponsored agency securities, which exceeded 10% of shareholders’ equity.
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