Investment Securities

12 Months Ended

Dec. 31, 2021

Investments, Debt and Equity Securities [Abstract]

NOTE 3 – INVESTMENT SECURITIES

The following tables present the amortized cost and estimated fair values of investment securities, as of December 31:


	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
	(in thousands)
2021
Available for Sale
U.S. Government securities	$	127,831	$	—	$	(213)	$	127,618

State and municipal securities	1,139,187		50,161		(678)		1,188,670
Corporate debt securities	373,482		13,009		(358)		386,133
Collateralized mortgage obligations	206,532		3,581		(754)		209,359
Residential mortgage-backed securities	231,607		1,224		(3,036)		229,795
Commercial mortgage-backed securities	974,541		6,141		(9,534)		971,148
Auction rate securities	76,350		—		(1,683)		74,667
Total	$	3,129,530	$	74,116	$	(16,256)	$	3,187,390



Held to Maturity

Residential mortgage-backed securities	$	404,958	$	11,022	$	(7,067)	$	408,913
Commercial mortgage-backed securities	575,426		—		(18,472)		556,954
Total	$	980,384	$	11,022	$	(25,539)	$	965,867

2020
Available for Sale


State and municipal securities	$	891,327	$	61,286	$	—	$	952,613
Corporate debt securities	348,391		19,445		(691)		367,145
Collateralized mortgage obligations	491,321		12,560		(115)		503,766
Residential mortgage-backed securities	373,779		4,246		(27)		377,998
Commercial mortgage-backed securities	741,172		22,384		(1,141)		762,415
Auction rate securities	101,510		—		(3,304)		98,206


Total	$	2,947,500	$	119,921	$	(5,278)	$	3,062,143

Held to Maturity

Residential mortgage-backed securities	$	278,281	$	18,576	$	—	$	296,857

On July 1, 2019, the Corporation transferred state and municipal securities from the HTM classification to the AFS classification as permitted through the early adoption of ASU 2019-04, as disclosed in "Note 1 - Summary of Significant Accounting Policies." The amortized cost of the securities transferred was $158.9 million, and the estimated fair value was $168.5 million. The Corporation has the positive intent and ability to hold the remainder of the HTM portfolio, consisting of residential mortgage-backed securities, to maturity.

Securities carried at $2,502.1 million at December 31, 2021 and $520.5 million at December 31, 2020, were pledged as collateral to secure public and trust deposits.

The amortized cost and estimated fair values of debt securities as of December 31, 2021, by contractual maturity, are shown in the following table. 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.


	Available for Sale				Held to Maturity
	Amortized Cost		Estimated Fair Value		Amortized Cost		Estimated Fair Value
	(in thousands)
Due in one year or less	$	9,053	$	9,175	$	—	$	—
Due from one year to five years	163,249		163,924		—		—
Due from five years to ten years	391,040		405,782		—		—
Due after ten years	1,153,508		1,198,207		—		—
	1,716,850		1,777,088		—		—
Residential mortgage-backed securities (1)	231,607		229,795		404,958		408,913
Commercial mortgage-backed securities (1)	974,541		971,148		575,426		556,954
Collateralized mortgage obligations (1)	206,532		209,359		—		—
Total	$	3,129,530	$	3,187,390	$	980,384	$	965,867

(1) Maturities for mortgage-backed securities and collateralized mortgage obligations are dependent upon the interest rate environment and prepayments on the underlying loans.

The following table presents information related to gross gains and losses on the sales of securities:


	Gross Realized Gains		Gross Realized Losses		Net Gains
	(in thousands)
2021	$	35,593	$	(2,077)	$	33,516
2020	6,545		(3,492)		3,053
2019	11,554		(6,821)		4,733

During 2021, the Corporation completed a balance sheet restructuring that included a $34.0 million gain on the sale of Visa Shares, offset by net losses on other securities of $0.4 million, primarily in connection with the sale of $24.6 million of ARCs.

During 2020, the Corporation completed a balance sheet restructuring that included the sale of investment securities, with an amortized cost of $79.0 million and an estimated fair value of $82.0 million, resulting in net investment securities gains of $3.0 million. Offsetting these gains were $2.9 million of prepayment penalties recorded in non-interest expense for the redemption of FHLB advances.

The following tables present the gross unrealized losses and estimated fair values of investments, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, as of December 31:


	Less Than 12 months					12 Months or Longer					Total
	Number of Securities	Estimated Fair Value		Unrealized Losses		Number of Securities	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
2021	(dollars in thousands)
Available for Sale
U.S. Government securities	2	$	127,618	$	(213)	—	$	—	$	—	$	127,618	$	(213)

State and municipal securities	29	82,731		(678)		—	—		—		82,731		(678)
Corporate debt securities	6	43,068		(358)		—	—		—		43,068		(358)
Collateralized mortgage obligations	4	28,517		(754)		—	—		—		28,517		(754)
Residential mortgage-backed securities	7	123,687		(2,388)		1	16,669		(648)		140,356		(3,036)
Commercial mortgage-backed securities	41	512,312		(9,534)		—	—		—		512,312		(9,534)
Auction rate securities	—	—		—		118	74,667		(1,683)		74,667		(1,683)
Total available for sale	89	$	917,933	$	(13,925)	119	$	91,336	$	(2,331)	$	1,009,269	$	(16,256)

Held to Maturity

Residential mortgage-backed securities	14	$	205,969	$	(7,067)	—	$	—	$	—	$	205,969	$	(7,067)
Commercial mortgage-backed securities	36	556,954		(18,472)		—	—		—		556,954		(18,472)
Total	50	$	762,923	$	(25,539)	—	$	—	$	—	$	762,923	$	(25,539)


	Less Than 12 months						12 Months or Longer				Total
	Number of Securities	Estimated Fair Value		Unrealized Losses		Number of Securities	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
2020
Available for Sale


Corporate debt securities	9	$	44,528	$	(377)	1	$	6,871	$	(314)	$	51,399	$	(691)
Collateralized mortgage obligations	3	57,601		(115)		—	—		—		57,601		(115)
Residential mortgage-backed securities	1	20,124		(27)		—	—		—		20,124		(27)
Commercial mortgage-backed securities	9	144,383		(1,141)		—	—		—		144,383		(1,141)
Auction rate securities	—	—		—		162	98,206		(3,304)		98,206		(3,304)
Total available for sale	22	$	266,636	$	(1,660)	163	$	105,077	$	(3,618)	$	371,713	$	(5,278)

No held to maturity securities were in an unrealized loss position as of December 31, 2020.

The Corporation’s collateralized mortgage obligations and mortgage-backed securities have contractual terms that generally do not permit the issuer to settle the securities at a price less than the amortized cost of the investment. The change in fair value of these securities is attributable to changes in interest rates and not credit quality. The Corporation does not have the intent to sell and does not believe it will more likely than not be required to sell any of these securities prior to a recovery of their fair value to amortized cost. Therefore, the Corporation does not have an ACL for these investments as of December 31, 2021 and 2020.

As of December 31, 2021 and 2020, all ARCs and corporate debt securities were rated above investment grade. All of the loans underlying the ARCs have principal payments which are guaranteed by the federal government. Based on the payment status, rating and management’s evaluation of these securities, no ACL was required for ARCs or corporate debt securities as of December 31, 2021 and 2020.