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Securities

12 Months Ended

Dec. 31, 2023

Securities

Securities

Note 3: Securities

Available-for-Sale Securities

AFS securities are summarized as follows as of the dates indicated:


		December 31, 2023
					Gross			Gross
					Unrealized			Unrealized			Approximate
		Amortized Cost			Gains			Losses			Fair Value

		(Dollars in thousands)
Federal agency obligations		$	9,988		$	84		$	—		$	10,072
U.S. Treasury securities			4,965			3			—			4,968
Mortgage-backed - GSE residential			233,203			629			21,370			212,462
Collateralized mortgage obligations - GSE residential			50,125			493			674			49,944
State and political subdivisions			396,349			497			40,949			355,897
Small Business Administration loan pools			125,017			722			961			124,778
Corporate bonds			9,740			—			1,208			8,532
Total available-for-sale securities		$	829,387		$	2,428		$	65,162		$	766,653


		December 31, 2022
					Gross			Gross
					Unrealized			Unrealized			Approximate
		Amortized Cost			Gains			Losses			Fair Value

		(Dollars in thousands)
Mortgage-backed - GSE residential		$	197,243		$	232		$	25,166		$	172,309
Collateralized mortgage obligations - GSE residential			11,629			—			743			10,886
State and political subdivisions			551,007			929			57,440			494,496
Corporate bonds			9,762			—			552			9,210
Total available-for-sale securities		$	769,641		$	1,161		$	83,901		$	686,901

The carrying value of securities pledged as collateral was $40 million and $22 million at December 31, 2023 and 2022, respectively.

As of December 31, 2023 and 2022, the AFS securities had $7 million and $6 million, respectively, of accrued interest, excluded from the amortized cost basis, and presented in “interest receivable” on the consolidated statements of financial condition.

The following table summarizes the gross realized gains and losses from sales or maturities of AFS securities:


		For the Year Ended December 31, 2023

		Gross Realized Gains			Gross Realized Losses			Net Realized Loss

		(Dollars in thousands)
Available-for-sale securities		$	462		$	1,589		$	(1,127)


		For the Year Ended December 31, 2022

		Gross Realized Gains			Gross Realized Losses			Net Realized Gain

		(Dollars in thousands)
Available-for-sale securities		$	146		$	50		$	96

The following table summarizes AFS securities with gross unrealized losses, as of the dates shown, along with the length of time in an unrealized loss position:


		December 31, 2023
		Less than 12 Months								12 Months or More								Total
		Fair			Unrealized			Number of		Fair			Unrealized			Number of		Fair			Unrealized			Number of
		Value			Losses			Securities		Value			Losses			Securities		Value			Losses			Securities

		(Dollars in thousands)
Available-for-Sale Securities
Federal agency obligations		$	—		$	—		—		$	—		$	—		—		$	—		$	—		—
U.S. Treasury securities			—			—		—			—			—		—			—			—		—
Mortgage-backed - GSE residential			21,523			56		5			137,626			21,314		52			159,149			21,370		57
Collateralized mortgage obligations - GSE residential			17,707			135		4			8,469			539		17			26,176			674		21
State and political subdivisions			33,577			207		20			287,128			40,742		190			320,705			40,949		210
Small Business Administration loan pools			76,380			959		11			91			2		4			76,471			961		15
Corporate bonds			—			—		—			8,532			1,208		5			8,532			1,208		5
Total temporarily impaired AFS securities		$	149,187		$	1,357		40		$	441,846		$	63,805		268		$	591,033		$	65,162		308


		December 31, 2022
		Less than 12 Months								12 Months or More								Total
		Fair			Unrealized			Number of		Fair			Unrealized			Number of		Fair			Unrealized			Number of
		Value			Losses			Securities		Value			Losses			Securities		Value			Losses			Securities

		(Dollars in thousands)
Available-for-Sale Securities
Mortgage-backed - GSE residential		$	91,929		$	10,410		41		$	66,036		$	14,756		16		$	157,965		$	25,166		57
Collateralized mortgage obligations - GSE residential			10,636			733		18			251			10		1			10,887			743		19
State and political subdivisions			350,884			36,697		266			52,519			20,743		40			403,403			57,440		306
Corporate bonds			9,210			552		5			—			—		—			9,210			552		5
Total temporarily impaired AFS securities		$	462,659		$	48,392		330		$	118,806		$	35,509		57		$	581,465		$	83,901		387

Management evaluated all of the AFS securities in an unrealized loss position at December 31, 2023. The unrealized losses in the Company’s investment portfolio were caused by interest rate changes. The Company does not intend to sell the investments and it is not more likely than not the Company will be required to sell the investments before recovery of their amortized cost basis. The Company has not recorded any credit losses on AFS securities in 2023 or 2022.

The amortized cost, fair value, and weighted average yield of AFS securities by contractual maturity, are shown below:


		December 31, 2023
		Within			After One to			After Five to			After
		One Year			Five Years			Ten Years			Ten Years			Total

		(Dollars in thousands)
Available-for-sale securities
Federal agency obligations⁽¹⁾
Amortized cost		$	—		$	—		$	—		$	9,988		$	9,988
Estimated fair value		$	—		$	—		$	—		$	10,072		$	10,072
Weighted average yield⁽²⁾			—	%		—	%		—	%		6.41	%		6.41	%
U.S. Treasury securities
Amortized cost		$	4,965		$	—		$	—		$	—		$	4,965
Estimated fair value		$	4,968		$	—		$	—		$	—		$	4,968
Weighted average yield⁽²⁾			5.56	%		—	%		—	%		—	%		5.56	%
Mortgage-backed - GSE residential⁽¹⁾
Amortized cost		$	—		$	—		$	889		$	232,314		$	233,203
Estimated fair value		$	—		$	—		$	821		$	211,641		$	212,462
Weighted average yield⁽²⁾			—	%		—	%		2.24	%		3.16	%		3.15	%
Collateralized mortgage obligations - GSE residential⁽¹⁾
Amortized cost		$	—		$	2,237		$	—		$	47,888		$	50,125
Estimated fair value		$	—		$	2,153		$	—		$	47,791		$	49,944
Weighted average yield⁽²⁾			—	%		2.78	%		—	%		5.23	%		5.12	%
State and political subdivisions⁽¹⁾
Amortized cost		$	520		$	3,727		$	55,956		$	336,146		$	396,349
Estimated fair value		$	529		$	3,726		$	55,446		$	296,196		$	355,897
Weighted average yield⁽²⁾			4.22	%		4.31	%		2.85	%		2.54	%		2.61	%
Small Business Administration loan pools⁽¹⁾
Amortized cost		$	—		$	9		$	84		$	124,924		$	125,017
Estimated fair value		$	—		$	10		$	81		$	124,687		$	124,778
Weighted average yield⁽²⁾			—	%		4.90	%		4.10	%		4.87	%		4.87	%
Corporate bonds⁽¹⁾
Amortized cost		$	—		$	143		$	9,597		$	—		$	9,740
Estimated fair value		$	—		$	140		$	8,392		$	—		$	8,532
Weighted average yield⁽²⁾			—	%		4.15	%		5.70	%		—	%		5.68	%
Total available-for-sale securities
Amortized cost		$	5,485		$	6,116		$	66,526		$	751,260		$	829,387
Estimated fair value		$	5,497		$	6,029		$	64,740		$	690,387		$	766,653
Weighted average yield⁽²⁾			5.43	%		3.75	%		3.25	%		3.34	%		3.35	%

⁽¹⁾	Actual maturities may differ from contractual maturities because issuers may have the rights to call or prepay obligations with or without prepayment penalties.

⁽²⁾	Yields are calculated based on amortized cost using a 30/360 day basis. Tax-exempt securities are not tax effected.


		December 31, 2022

		Within			After One to			After Five to			After
		One Year			Five Years			Ten Years			Ten Years			Total

		(Dollars in thousands)
Available-for-sale securities
Mortgage-backed - GSE residential⁽¹⁾
Amortized cost		$	—		$	18		$	105		$	197,120		$	197,243
Estimated fair value		$	—		$	17		$	101		$	172,191		$	172,309
Weighted average yield⁽²⁾			—	%		4.77	%		4.05	%		2.39	%		2.39	%
Collateralized mortgage obligations - GSE residential⁽¹⁾
Amortized cost		$	—		$	—		$	2,344		$	9,285		$	11,629
Estimated fair value		$	—		$	—		$	2,229		$	8,657		$	10,886
Weighted average yield⁽²⁾			—	%		—	%		2.77	%		2.25	%		2.36	%
State and political subdivisions⁽¹⁾
Amortized cost		$	1,076		$	6,310		$	109,771		$	433,850		$	551,007
Estimated fair value		$	1,077		$	6,471		$	109,134		$	377,814		$	494,496
Weighted average yield⁽²⁾			3.54	%		4.60	%		3.08	%		2.70	%		2.80	%
Corporate bonds⁽¹⁾
Amortized cost		$	—		$	150		$	9,612		$	—		$	9,762
Estimated fair value		$	—		$	146		$	9,064		$	—		$	9,210
Weighted average yield⁽²⁾			—	%		5.43	%		5.70	%		—	%		5.70	%
Total available-for-sale securities
Amortized cost		$	1,076		$	6,478		$	121,832		$	640,255		$	769,641
Estimated fair value		$	1,077		$	6,634		$	120,528		$	558,662		$	686,901
Weighted average yield⁽²⁾			3.54	%		4.62	%		3.28	%		2.60	%		2.74	%

⁽¹⁾	Actual maturities may differ from contractual maturities because issuers may have the rights to call or prepay obligations with or without prepayment penalties.

⁽²⁾	Yields are calculated based on amortized cost using a 30/360 day basis. Tax-exempt securities are not tax effected.

Equity Securities

Equity securities consist of $5.8 million of private equity investments. Equity securities are included in other assets on the consolidated statements of financial condition.

During 2020, the Company acquired an $11 million privately-held security in partial satisfaction of debts previously contracted. During 2021, the Company sold the equity security for $5 million that resulted in a $6 million realized loss which is included in “other non-interest income” in the consolidated statement of operations.

The following is a summary of the recorded fair value and the unrealized and realized gains and losses recognized in net income on equity securities:


		For the Year Ended December 31,

		2023			2022			2021

		(Dollars in thousands)
Net gains (losses) recognized during the reporting period on equity securities		$	132		$	(181)		$	(6,325)
Less: net gains (losses) recognized during the period on equity securities sold during the period			93			(181)			(6,245)
Unrealized gain (loss) recognized during the reporting period on equity securities still held at the reporting date		$	39		$	—		$	(80)