Investment Securities

12 Months Ended

Dec. 31, 2020

Investments, Debt and Equity Securities [Abstract]

The amortized cost and estimated fair values of investment securities classified as available for sale and held to maturity are summarized in the following tables:


	December 31, 2020
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
			(in thousands)
Debt Securities Available for Sale
Obligations of U.S. government agencies	$	795,555	$	17,710	$	(891)	$	812,374
Obligations of states and political subdivisions	123,347		5,748		—		129,095
Corporate bonds	2,459		85		—		2,544
Asset backed securities	473,720		1,682		(5,151)		470,251
Total debt securities available for sale	$	1,395,081	$	25,225	$	(6,042)	$	1,414,264
Debt Securities Held to Maturity
Obligations of U.S. government agencies	273,667		13,774		—		287,441
Obligations of states and political subdivisions	10,896		389		—		11,285
Total debt securities held to maturity	$	284,563	$	14,163	$	—	$	298,726

There was no allowance for credit losses recorded for the held to maturity debt portfolio as of or for the year ended December 31, 2020.


	December 31, 2019
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
			(in thousands)
Debt Securities Available for Sale
Obligations of U.S. government agencies	$	466,139	$	7,261	$	(420)	$	472,980
Obligations of states and political subdivisions	106,373		3,229		(1)		109,601
Corporate bonds	2,430		102		—		2,532
Asset backed securities	371,809		129		(6,913)		365,025
Total debt securities available for sale	$	946,751	$	10,721	$	(7,334)	$	950,138
Debt Securities Held to Maturity
Obligations of U.S. government agencies	$	361,785	$	6,072	$	(480)	$	367,377
Obligations of states and political subdivisions	13,821		327		—		14,148
Total debt securities held to maturity	$	375,606	$	6,399	$	(480)	$	381,525

During 2020, proceeds from sales of debt securities were $229,000, resulting in gross gains of $7,000. During 2019, proceeds from sales of debt securities were $127,066,000, resulting in a gross gains of $338,000 and gross losses of $228,000. During 2018, proceeds from sales of debt securities totaled $293,279,000, resulting in gross gains of $207,000. Investment securities with an aggregate carrying value of $429,049,000 and $466,321,000 at December 31, 2020 and 2019, respectively, were pledged as collateral for specific borrowings, lines of credit and local agency deposits.

The amortized cost and estimated fair value of debt securities at December 31, 2020 by contractual maturity are shown below. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. At December 31, 2020, obligations of U.S. government and agencies with an amortized cost basis totaling $828,047,000 consist almost entirely of residential real estate mortgage-backed securities whose contractual maturity, or principal repayment, will follow the repayment of the underlying mortgages. For purposes of the following table, the entire outstanding balance of these mortgage-backed securities issued by U.S. government corporations and agencies is categorized based on final maturity date. At December 31, 2020, the Company estimates the average remaining life of these mortgage-backed securities issued by U.S. government corporations and agencies to be approximately 3.06 years. Average remaining life is defined as the time span after which the principal balance has been reduced by half.


Debt Securities	Available for Sale				Held to Maturity
(In thousands)	Amortized Cost		Estimated Fair Value		Amortized Cost		Estimated Fair Value
Due in one year	$	20,000	$	19,994	$	—	$	—
Due after one year through five years	193,791		194,337		993		1,135
Due after five years through ten years	157,945		159,670		18,755		19,640
Due after ten years	1,023,345		1,040,263		264,815		277,951
Totals	$	1,395,081	$	1,414,264	$	284,563	$	298,726

Gross unrealized losses on investment securities and the fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, were as follows:


	Less than 12 months				12 months or more				Total
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
December 31, 2020	(in thousands)
Debt Securities Available for Sale
Obligations of U.S. government agencies	$	160,543	$	(891)	$	—	$	—	$	160,543	$	(891)

Asset backed securities	51,544		(441)		297,020		(4,710)		348,564		(5,151)
Total debt securities available for sale	$	212,087	$	(1,332)	$	297,020	$	(4,710)	$	509,107	$	(6,042)


	Less than 12 months				12 months or more				Total
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
December 31, 2019	(in thousands)
Debt Securities Available for Sale
Obligations of U.S. government agencies	$	36,709	$	(309)	$	23,852	$	(111)	$	60,561	$	(420)
Obligations of states and political subdivisions	778		(1)		—		—		778		(1)
Asset backed securities	237,463		(4,535)		99,981		(2,378)		337,444		(6,913)
Total securities available for sale	$	274,950	$	(4,845)	$	123,833	$	(2,489)	$	398,783	$	(7,334)
Debt Securities Held to Maturity
Obligations of U.S. government agencies	$	18,813	$	(142)	$	62,952	$	(338)	$	81,765	$	(480)

Obligations of U.S. government corporations and agencies: Unrealized losses on investments in obligations of U.S. government corporations and agencies are caused by interest rate increases. The contractual cash flows of these securities are guaranteed by U.S. Government Sponsored Entities (principally Fannie Mae and Freddie Mac). It is expected that the securities would not be settled at a price less than the amortized cost of the investment. Because the decline in fair value is attributable to changes in interest rates and not credit quality, and because the Company does not intend to sell and more likely than not will not be required to sell, these investments are not considered other-than-temporarily impaired. At December 31, 2020, 10 debt securities representing obligations of U.S. government corporations and agencies had unrealized losses with aggregate depreciation of 0.55% from the Company’s amortized cost basis.

Asset backed securities: The unrealized losses on investments in asset backed securities were caused by increases in required yields by investors in these types of securities. At the time of purchase, each of these securities were rated AA or AAA and through December 31, 2020 have not experienced any deterioration in credit rating. The Company continues to monitor these securities for changes in credit rating or other indications of credit deterioration. Because management believes the decline in fair value is attributable to changes in interest rates and not credit quality, and because the Company does not intend to sell and more likely than not will not be required to sell, these investments are not considered other-than-temporarily impaired. At December 31, 2020, 30 asset backed securities had unrealized losses with aggregate depreciation of 1.46% from the Company’s amortized cost basis.

Marketable equity securities: All unrealized gains recognized during the reporting period were for equity securities still held at December 31, 2020.