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Investment Securities
 6 Months Ended
Jun. 30, 2022
Investments, Debt and Equity Securities [Abstract]  
Investment Securities INVESTMENT SECURITIES     
Transfer of Securities Available-for-Sale to Held-to Maturity
Effective June 1, 2022, the Company transferred $2.3 billion in fair value of municipal securities, agency commercial MBS, private label commercial MBS, U.S. Treasury securities, and corporate debt securities from available-for-sale to held-to-maturity. At the time of transfer, $218.3 million of unrealized losses, net of tax, was retained in "Accumulated other comprehensive income (loss)" on the condensed consolidated balance sheets.
Securities Available-for-Sale
The following table presents amortized cost, gross unrealized gains and losses, and fair values of securities available-for-sale as of the dates indicated:
 June 30, 2022December 31, 2021
GrossGrossGrossGross
AmortizedUnrealizedUnrealizedFairAmortizedUnrealizedUnrealizedFair
Security TypeCostGainsLossesValueCostGainsLossesValue
 (In thousands)
Agency residential MBS$2,898,484 $901 $(321,670)$2,577,715 $2,921,993 $8,866 $(32,649)$2,898,210 
Agency commercial MBS1,020,083 849 (44,711)976,221 1,660,516 37,664 (9,213)1,688,967 
Agency residential CMOs844,508 109 (41,308)803,309 1,021,716 22,288 (5,870)1,038,134 
Municipal securities 742,845 3,219 (45,459)700,605 2,248,749 75,192 (7,973)2,315,968 
U.S. Treasury securities771,019 — (74,965)696,054 973,555 1,641 (8,298)966,898 
Corporate debt securities388,466 75 (19,080)369,461 514,077 13,774 (757)527,094 
Collateralized loan obligations365,354 — (13,064)352,290 385,410 396 (444)385,362 
Private label residential CMOs248,155 — (32,052)216,103 265,851 1,857 (3,291)264,417 
Asset-backed securities33,354 4 (711)32,647 129,387 484 (324)129,547 
Private label commercial MBS34,411 — (1,895)32,516 453,314 147 (3,244)450,217 
SBA securities24,322 — (595)23,727 28,950 726 (32)29,644 
Total$7,371,001 $5,157 $(595,510)$6,780,648 $10,603,518 $163,035 $(72,095)$10,694,458 
As of June 30, 2022, the Company had not recorded an allowance for credit losses on securities available-for-sale. The Company does not consider unrealized losses on such securities to be attributable to credit-related factors, as the unrealized losses have occurred as a result of changes in non-credit related factors such as interest rates, market spreads, and market conditions subsequent to purchase.
As of June 30, 2022, securities available-for-sale with a fair value of $2.2 billion were pledged as collateral for public deposits and other purposes as required by various statutes and agreements.
Realized Gains and Losses on Securities Available-for-Sale
The following table presents the amortized cost of securities sold with related gross realized gains, gross realized losses, and net realized (losses) gains for the years indicated:
Three Months EndedSix Months Ended
June 30,June 30,
Sales of Securities Available-for-Sale2022202120222021
(In thousands)
Amortized cost of securities sold $393,432 $— $599,520 $44,551 
Gross realized gains$1,544 $— $2,734 $101 
Gross realized losses(2,753)— (3,839)— 
Net realized (losses) gains $(1,209)$— $(1,105)$101 
Unrealized Losses on Securities Available-for-Sale
The following tables present the gross unrealized losses and fair values of securities available-for-sale that were in unrealized loss positions as of the dates indicated:
June 30, 2022
 Less Than 12 Months12 Months or MoreTotal
GrossGrossGross
FairUnrealizedFairUnrealizedFairUnrealized
Security TypeValueLossesValueLossesValueLosses
 (In thousands)
Agency residential MBS$2,232,774 $(288,563)$262,847 $(33,107)$2,495,621 $(321,670)
Agency commercial MBS851,935 (39,376)41,199 (5,335)893,134 (44,711)
Agency residential CMOs707,516 (29,892)88,546 (11,416)796,062 (41,308)
Municipal securities 463,945 (45,459)— — 463,945 (45,459)
U.S. Treasury securities696,054 (74,965)— — 696,054 (74,965)
Corporate debt securities355,637 (19,080)— — 355,637 (19,080)
Collateralized loan obligations269,865 (9,256)82,425 (3,808)352,290 (13,064)
Private label residential CMOs216,103 (32,052)— — 216,103 (32,052)
Asset-backed securities31,261 (711)— — 31,261 (711)
Private label commercial MBS23,206 (1,177)9,311 (718)32,517 (1,895)
SBA securities21,946 (521)1,781 (74)23,727 (595)
Total$5,870,242 $(541,052)$486,109 $(54,458)$6,356,351 $(595,510)
December 31, 2021
 Less Than 12 Months12 Months or MoreTotal
GrossGrossGross
FairUnrealizedFairUnrealizedFairUnrealized
Security TypeValueLossesValueLossesValueLosses
 (In thousands)
Agency residential MBS$2,502,536 $(31,670)$57,329 $(979)$2,559,865 $(32,649)
Agency commercial MBS440,938 (5,066)106,745 (4,147)547,683 (9,213)
Agency residential CMOs216,445 (3,757)67,340 (2,113)283,785 (5,870)
Municipal securities 505,080 (6,965)29,726 (1,008)534,806 (7,973)
U.S. Treasury securities628,767 (8,298)— — 628,767 (8,298)
Corporate debt securities32,761 (757)— — 32,761 (757)
Collateralized loan obligations137,619 (374)43,730 (70)181,349 (444)
Private label residential CMOs201,988 (3,291)— — 201,988 (3,291)
Asset-backed securities38,742 (137)15,762 (187)54,504 (324)
Private label commercial MBS397,619 (3,244)— — 397,619 (3,244)
SBA securities— — 1,864 (32)1,864 (32)
Total$5,102,495 $(63,559)$322,496 $(8,536)$5,424,991 $(72,095)
The securities that were in an unrealized loss position at June 30, 2022, were considered impaired and required further review to determine if the unrealized losses were credit-related. We concluded the unrealized losses were a result of the level of market interest rates relative to the types of securities and pricing changes caused by shifting supply and demand dynamics and not a result of downgraded credit ratings or other indicators of deterioration of the underlying issuers' ability to repay. We also considered the seniority of the tranches and U.S. government agency guarantees, if any, to assess whether an unrealized loss was credit-related. Accordingly, we determined the unrealized losses were not credit-related and recognized the unrealized losses in "other comprehensive income (loss)" in stockholders' equity. Although we periodically sell securities for portfolio management purposes, we do not foresee having to sell any impaired securities strictly for liquidity needs and believe that it is more likely than not we would not be required to sell any impaired securities before recovery of their amortized cost.
Contractual Maturities of Securities Available-for-Sale
The following table presents the contractual maturities of our securities available-for-sale portfolio based on amortized cost and carrying value as of the date indicated:
June 30, 2022
Due AfterDue After
Due One Year Five YearsDue
WithinThroughThroughAfter
Security TypeOne YearFive YearsTen YearsTen YearsTotal
(In thousands)
Amortized Cost:
Agency residential MBS$28 $6,756 $4,625 $2,887,075 $2,898,484 
Agency commercial MBS6,847 529,921 452,921 30,394 1,020,083 
Agency residential CMOs— 1,487 206,723 636,298 844,508 
Municipal securities17,625 85,139 394,484 245,597 742,845 
U.S. Treasury securities4,996 — 766,023 — 771,019 
Corporate debt securities— 22,500 365,966 — 388,466 
Collateralized loan obligations— — 101,154 264,200 365,354 
Private label residential CMOs— — — 248,155 248,155 
Asset-backed securities— — 1,382 31,972 33,354 
Private label commercial MBS4,004 — — 30,407 34,411 
SBA securities1,855 6,007 — 16,460 24,322 
Total$35,355 $651,810 $2,293,278 $4,390,558 $7,371,001 
Fair Value:
Agency residential MBS$29 $6,794 $4,692 $2,566,200 $2,577,715 
Agency commercial MBS6,847 517,077 422,320 29,977 976,221 
Agency residential CMOs— 1,486 191,837 609,986 803,309 
Municipal securities17,639 84,751 355,007 243,208 700,605 
U.S. Treasury securities4,995 — 691,059 — 696,054 
Corporate debt securities— 22,050 347,411 — 369,461 
Collateralized loan obligations— — 98,461 253,829 352,290 
Private label residential CMOs— — — 216,103 216,103 
Asset-backed securities— — 1,386 31,261 32,647 
Private label commercial MBS3,890 — — 28,626 32,516 
SBA securities1,781 5,862 — 16,084 23,727 
Total$35,181 $638,020 $2,112,173 $3,995,274 $6,780,648 
CMBS, CMOs, and MBS have contractual maturity dates, but require periodic payments based upon scheduled amortization terms. Actual principal collections on these securities usually occur more rapidly than the scheduled amortization terms because of prepayments made by obligors of the underlying loan collateral.
Securities Held-to-Maturity
The following table presents amortized cost, allowance for credit losses, gross unrealized gains and losses, and fair values of securities held-to-maturity as of the date indicated:
 June 30, 2022
Allowance
forNetGrossGross
AmortizedCreditCarryingUnrealizedUnrealizedFair
Security TypeCostLossesAmountGainsLossesValue
 (In thousands)
Municipal securities $1,241,664 $(140)$1,241,524 $554 $(36,762)$1,205,316 
Agency commercial MBS424,274 — 424,274 — (4,626)419,648 
Private label commercial MBS343,545 — 343,545 — (5,663)337,882 
U.S. Treasury securities182,751 — 182,751 — (1,855)180,896 
Corporate debt securities69,633 (1,360)68,273 — (2,256)66,017 
Total (1)
$2,261,867 $(1,500)$2,260,367 $554 $(51,162)$2,209,759 
__________________________
(1)    Excludes accrued interest receivable of $13.7 million at June 30, 2022 which is recorded in "Other assets" on the condensed consolidated balance sheets.
As of June 30, 2022, securities held-to-maturity with a fair value of $619.4 million were pledged as collateral for public deposits and other purposes as required by various statutes and agreements.
Allowance for Credit Losses on Securities Held-to-Maturity
The following table presents the changes by major security type in our allowance for credit losses on securities held-to-maturity for the periods indicated:
Allowance forProvision Allowance for
Credit Losses,for Credit Losses,
Beginning Credit End of
Security Typeof PeriodLossesCharge-offsRecoveriesPeriod
(In thousands)
Three Months Ended June 30, 2022
Municipal securities$— $140 $— $— $140 
Corporate debt securities— 1,360 — — 1,360 
Total$— $1,500 $— $— $1,500 
Six Months Ended June 30, 2022
Municipal securities$— $140 $— $— $140 
Corporate debt securities— 1,360 — — 1,360 
Total$— $1,500 $— $— $1,500 
Credit losses on HTM securities are recorded at the time of purchase, acquisition, or when the Company designates securities as held-to-maturity. Credit losses on HTM securities are representative of current expected credit losses that may be incurred over the life of the investment. Accrued interest receivable on HTM securities, which is included in other assets on the condensed consolidated balance sheets, is excluded from the estimate of expected credit losses. HTM U.S. treasury securities and agency-backed MBS securities are considered to have no risk of loss as they are either explicitly or implicitly guaranteed by the U.S. government. The change in fair value in the HTM private label CMBS portfolio is solely driven by changes in interest rates. The Company has no knowledge of any underlying credit issues and the cash flows underlying the debt securities have not changed and are not expected to be impacted by changes in interest rates and, thus, there is no related ACL for this portfolio. The underlying bonds in the Company’s HTM municipal securities and HTM corporate debt securities portfolios are evaluated for credit losses in conjunction with management’s estimate of the allowance for credit losses based primarily on credit ratings.
Securities Held-to-Maturity by Credit Quality Indicator
The Company uses S&P, Moody's, Fitch, Kroll, and Egan Jones ratings as the credit quality indicators for its held-to-maturity securities. The following table presents our securities held-to-maturity portfolio by the lowest available credit rating as of the date indicated:
June 30, 2022
Security TypeAAAAA+AAAA-AA-BBBNRTotal
(In thousands)
Amortized Cost:
Municipal securities$585,084 $363,461 $178,341 $89,655 $1,997 $— $— $23,126 $1,241,664 
Agency commercial MBS— 424,274 — — — — — — 424,274 
Private label commercial
MBS343,545 — — — — — — — 343,545 
U.S. Treasury securities— 182,751 — — — — — — 182,751 
Corporate debt securities— — — — — 23,196 20,985 25,452 69,633 
Total$928,629 $970,486 $178,341 $89,655 $1,997 $23,196 $20,985 $48,578 $2,261,867 
Contractual Maturities of Securities Held-to-Maturity
The following table presents the contractual maturities of our securities held-to-maturity portfolio based on amortized cost and carrying value as of the date indicated:
June 30, 2022
Due AfterDue After
Due One Year Five YearsDue
WithinThroughThroughAfter
Security TypeOne YearFive YearsTen YearsTen YearsTotal
(In thousands)
Amortized Cost:
Municipal securities$— $— $286,105 $955,559 $1,241,664 
Agency commercial MBS— — 400,499 23,775 424,274 
Private label commercial MBS— — 35,780 307,765 343,545 
U.S. Treasury securities— — 182,751 — 182,751 
Corporate debt securities— — — 69,633 69,633 
Total$— $— $905,135 $1,356,732 $2,261,867 
Fair Value:
Municipal securities$— $— $283,530 $921,786 $1,205,316 
Agency commercial MBS— — 396,316 23,332 419,648 
Private label commercial MBS— — 35,209 302,673 337,882 
U.S. Treasury securities— — 180,896 — 180,896 
Corporate debt securities— — — 66,017 66,017 
Total$— $— $895,951 $1,313,808 $2,209,759 
CMBS have contractual maturity dates, but require periodic payments based upon scheduled amortization terms. Actual principal collections on these securities usually occur more rapidly than the scheduled amortization terms because of prepayments made by obligors of the underlying loan collateral.
Interest Income on Investment Securities
The following table presents the composition of our interest income on investment securities, including available-for-sale and held-to-maturity, for the periods indicated:
Three Months EndedSix Months Ended
June 30,June 30,
2022202120222021
(In thousands)
Taxable interest$44,467 $25,206 $89,109 $47,176 
Non-taxable interest8,180 8,493 16,699 16,571 
Dividend income255 255 516 472 
Total interest income on investment securities$52,902 $33,954 $106,324 $64,219