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Securities
 12 Months Ended
Dec. 31, 2019
Investments Debt And Equity Securities [Abstract]  
Securities

NOTE 4. SECURITIES

The following table presents the fair value and amortized cost of available-for-sale and held-to-maturity debt securities:

 

 

December 31, 2019

 

 

December 31, 2018

 

(in thousands)

Amortized

Cost

 

Gross

Unrealized

Gains

 

Gross

Unrealized

Losses

 

Estimated

Fair Value

 

 

Amortized

Cost

 

Gross

Unrealized

Gains

 

Gross

Unrealized

Losses

 

Estimated

Fair Value

 

Available-for-sale debt securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury

$

32,790

 

$

47

 

$

(1

)

$

32,836

 

 

$

19,882

 

$

3

 

$

(7

)

$

19,878

 

U.S. Government sponsored entities and

   agencies

 

157,088

 

 

2,862

 

 

(322

)

 

159,628

 

 

 

142,852

 

 

556

 

 

(1,756

)

 

141,652

 

Residential mortgage-backed securities

   and collateralized mortgage obligations

   of government sponsored entities and

   agencies

 

1,803,268

 

 

18,850

 

 

(6,131

)

 

1,815,987

 

 

 

1,585,864

 

 

2,912

 

 

(27,521

)

 

1,561,255

 

Commercial mortgage-backed securities

   and collateralized mortgage obligations

   of government sponsored entities and

   agencies

 

187,268

 

 

3,270

 

 

(129

)

 

190,409

 

 

 

171,671

 

 

264

 

 

(2,963

)

 

168,972

 

Obligations of states and political

   subdivisions

 

140,357

 

 

5,253

 

 

(1

)

 

145,609

 

 

 

184,057

 

 

2,039

 

 

(982

)

 

185,114

 

Corporate debt securities

 

48,645

 

 

581

 

 

(137

)

 

49,089

 

 

 

37,730

 

 

87

 

 

(559

)

 

37,258

 

Total available-for-sale debt securities

$

2,369,416

 

$

30,863

 

$

(6,721

)

$

2,393,558

 

 

$

2,142,056

 

$

5,861

 

$

(33,788

)

$

2,114,129

 

Held-to-maturity debt securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Government sponsored entities and

   agencies

$

9,216

 

$

30

 

$

(116

)

$

9,130

 

 

$

10,823

 

$

6

 

$

(329

)

$

10,500

 

Residential mortgage-backed securities

   and collateralized mortgage obligations

   of government sponsored entities and

   agencies

 

122,937

 

 

1,031

 

 

(261

)

 

123,707

 

 

 

148,300

 

 

204

 

 

(4,170

)

 

144,334

 

Obligations of states and political

   subdivisions

 

686,376

 

 

20,475

 

 

(258

)

 

706,593

 

 

 

828,520

 

 

8,771

 

 

(4,012

)

 

833,279

 

Corporate debt securities

 

33,224

 

 

1,869

 

 

—

 

 

35,093

 

 

 

33,291

 

 

12

 

 

(673

)

 

32,630

 

Total held-to-maturity debt securities

$

851,753

 

$

23,405

 

$

(635

)

$

874,523

 

 

$

1,020,934

 

$

8,993

 

$

(9,184

)

$

1,020,743

 

Total debt securities

$

3,221,169

 

$

54,268

 

$

(7,356

)

$

3,268,081

 

 

$

3,162,990

 

$

14,854

 

$

(42,972

)

$

3,134,872

 

 

At December 31, 2019 and 2018 there were no holdings of any one issuer, other than U.S. government sponsored entities and its agencies, in an amount greater than 10% of Wesbanco’s shareholders’ equity.

Equity securities, of which $8.9 million consist of investments in various mutual funds held in grantor trusts formed in connection with the Company’s deferred compensation plan, are recorded at fair value and totaled $12.3 million and $11.7 million at December 31, 2019 and 2018, respectively.

Wesbanco adopted ASU 2017-12, “Targeted Improvements to Accounting for Hedging Activities” on January 1, 2019. Upon adoption, Wesbanco reclassified $67.3 million of callable held-to-maturity municipal debt securities to available-for-sale debt securities.

The following table presents the fair value of available-for-sale and held-to-maturity debt securities by contractual maturity at December 31, 2019. In some instances, the issuers may have the right to call or prepay obligations without penalty prior to the contractual maturity date.

 

(in thousands)

 

Amortized Cost

 

 

Fair Value

 

Available-for-sale debt securities

 

 

 

 

 

 

 

 

Less than one year

 

$

60,162

 

 

$

60,188

 

1-5 years

 

 

145,702

 

 

 

147,933

 

5-10 years

 

 

409,137

 

 

 

415,068

 

Over 10 years

 

 

1,754,415

 

 

 

1,770,369

 

Total available-for-sale debt securities

 

$

2,369,416

 

 

$

2,393,558

 

Held-to-maturity debt securities

 

 

 

 

 

 

 

 

Less than one year

 

$

20,968

 

 

$

21,040

 

1-5 years

 

 

124,311

 

 

 

128,105

 

5-10 years

 

 

316,440

 

 

 

325,593

 

Over 10 years

 

 

390,034

 

 

 

399,785

 

Total held-to-maturity debt securities

 

$

851,753

 

 

$

874,523

 

Total debt securities

 

$

3,221,169

 

 

$

3,268,081

 

 

Securities with aggregate fair values of $2.0 billion at December 31, 2019 and 2018, respectively, were pledged as security for public and trust funds, and securities sold under agreements to repurchase. Proceeds from the sale of available-for-sale securities were $125.8 million, $82.1 million and $7.8 million for the years ended December 31, 2019, 2018 and 2017, respectively. Net unrealized gains (losses) on available-for-sale securities included in accumulated other comprehensive income, net of tax, as December 31, 2019, 2018, and 2017 were $20.7 million, ($21.5) million and ($13.3) million, respectively.

The following table presents the gross realized gains and losses on sales and calls of available-for-sale and held-to-maturity debt securities, as well as gains and losses on equity securities from both sales and market adjustments resulting from the adoption of ASU 2016-01 effective January 1, 2018 for the years ended December 31, 2019, 2018 and 2017, respectively.

 

 

 

For the Years Ended December 31,

 

(in thousands)

 

2019

 

 

2018

 

 

2017

 

Debt securities:

 

 

 

 

 

 

 

 

 

 

 

 

Gross realized gains

 

$

1,497

 

 

$

128

 

 

$

675

 

Gross realized losses

 

 

(981

)

 

 

(46

)

 

 

(108

)

Net gains on debt securities

 

$

516

 

 

$

82

 

 

$

567

 

Equity securities:

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized gains (losses) recognized on securities still held

 

$

1,226

 

 

$

(986

)

 

$

-

 

Net realized gains recognized on securities sold

 

 

2,578

 

 

 

4

 

 

 

-

 

Net gains (losses) on equity securities

 

$

3,804

 

 

$

(982

)

 

$

-

 

Net securities gains (losses)

 

$

4,320

 

 

$

(900

)

 

$

567

 

 

The following tables provide information on unrealized losses on debt securities that have been in an unrealized loss position for less than twelve months and twelve months or more as December 31, 2019 and 2018:

 

 

 

December 31, 2019

 

 

 

Less than 12 months

 

 

12 months or more

 

 

Total

 

(dollars in thousands)

 

Fair

Value

 

 

Unrealized

Losses

 

 

# of

Securities

 

 

Fair

Value

 

 

Unrealized

Losses

 

 

# of

Securities

 

 

Fair

Value

 

 

Unrealized

Losses

 

 

# of

Securities

 

U.S. Treasury

 

$

1,499

 

 

$

(1

)

 

 

1

 

 

$

—

 

 

$

—

 

 

 

—

 

 

$

1,499

 

 

$

(1

)

 

 

1

 

U.S. Government sponsored

   entities and agencies

 

 

57,650

 

 

 

(274

)

 

 

25

 

 

 

6,593

 

 

 

(164

)

 

 

2

 

 

 

64,243

 

 

 

(438

)

 

 

27

 

Residential mortgage-backed

   securities and collateralized

   mortgage obligations of

   government sponsored entities

   and agencies

 

 

544,692

 

 

 

(3,725

)

 

 

116

 

 

 

272,884

 

 

 

(2,667

)

 

 

122

 

 

 

817,576

 

 

 

(6,392

)

 

 

238

 

Commercial mortgage-backed

   securities and collateralized

   mortgage obligations of

   government sponsored entities

   and agencies

 

 

43,123

 

 

 

(124

)

 

 

7

 

 

 

3,704

 

 

 

(5

)

 

 

2

 

 

 

46,827

 

 

 

(129

)

 

 

9

 

Obligations of states and political

   subdivisions

 

 

17,876

 

 

 

(122

)

 

 

22

 

 

 

4,413

 

 

 

(137

)

 

 

8

 

 

 

22,289

 

 

 

(259

)

 

 

30

 

Corporate debt securities

 

 

4,120

 

 

 

(44

)

 

 

1

 

 

 

4,926

 

 

 

(93

)

 

 

2

 

 

 

9,046

 

 

 

(137

)

 

 

3

 

Total temporarily impaired

   securities

 

$

668,960

 

 

$

(4,290

)

 

 

172

 

 

$

292,520

 

 

$

(3,066

)

 

 

136

 

 

$

961,480

 

 

$

(7,356

)

 

 

308

 

 

 

 

December 31, 2018

 

 

 

Less than 12 months

 

 

12 months or more

 

 

Total

 

(dollars in thousands)

 

Fair

Value

 

 

Unrealized

Losses

 

 

# of

Securities

 

 

Fair

Value

 

 

Unrealized

Losses

 

 

# of

Securities

 

 

Fair

Value

 

 

Unrealized

Losses

 

 

# of

Securities

 

U.S Treasury

 

$

9,972

 

 

$

(7

)

 

 

1

 

 

$

-

 

 

$

-

 

 

 

-

 

 

$

9,972

 

 

$

(7

)

 

 

1

 

U.S. Government sponsored

   entities and agencies

 

 

18,926

 

 

 

(148

)

 

 

8

 

 

 

76,385

 

 

 

(1,937

)

 

 

14

 

 

 

95,311

 

 

 

(2,085

)

 

 

22

 

Residential mortgage-backed

   securities and collateralized

   mortgage obligations of

   government sponsored entities

   and agencies

 

 

285,534

 

 

 

(1,862

)

 

 

44

 

 

 

922,698

 

 

 

(29,829

)

 

 

291

 

 

 

1,208,232

 

 

 

(31,691

)

 

 

335

 

Commercial mortgage-backed

   securities and collateralized

   mortgage obligations of

   government sponsored entities

   and agencies

 

 

9,186

 

 

 

(18

)

 

 

6

 

 

 

111,068

 

 

 

(2,945

)

 

 

14

 

 

 

120,254

 

 

 

(2,963

)

 

 

20

 

Obligations of states and political

   subdivisions

 

 

104,469

 

 

 

(439

)

 

 

207

 

 

 

303,681

 

 

 

(4,555

)

 

 

513

 

 

 

408,150

 

 

 

(4,994

)

 

 

720

 

Corporate debt securities

 

 

38,791

 

 

 

(898

)

 

 

18

 

 

 

11,452

 

 

 

(334

)

 

 

5

 

 

 

50,243

 

 

 

(1,232

)

 

 

23

 

Total temporarily impaired

   securities

 

$

466,878

 

 

$

(3,372

)

 

 

284

 

 

$

1,425,284

 

 

$

(39,600

)

 

 

837

 

 

$

1,892,162

 

 

$

(42,972

)

 

 

1,121

 

 

Unrealized losses on debt securities in the tables represent temporary fluctuations resulting from changes in market rates in relation to fixed yields. Unrealized losses in the available-for-sale portfolio are accounted for as an adjustment, net of taxes, to other comprehensive income in shareholders’ equity.

Wesbanco does not believe the securities presented above are impaired due to reasons of credit quality, as substantially all debt securities are rated above investment grade and all are paying principal and interest according to their contractual terms. Wesbanco does not intend to sell, nor is it more likely than not that it will be required to sell, loss position securities prior to recovery of their cost, and therefore, management believes the unrealized losses detailed above are temporary and no impairment loss relating to these securities has been recognized.

Securities that do not have readily determinable fair values and for which Wesbanco does not exercise significant influence are carried at cost. Cost method investments consist primarily of FHLB of Pittsburgh, Cincinnati and Indianapolis stock totaling $66.8 million and

$50.8  million at December 31, 2019 and 2018, respectively, and are included in other assets in the Consolidated Balance Sheets. Cost method investments are evaluated for impairment whenever events or circumstances suggest that their carrying value may not be recoverable.