Securities

9 Months Ended

Sep. 30, 2023

Investments, Debt and Equity Securities [Abstract]

The following table presents the fair values of our securities portfolio at the dates presented:


(dollars in thousands)	September 30, 2023		December 31, 2022
Debt securities	$	954,267	$	1,001,784
Equity securities	995		994
Total Securities Available for Sale	$	955,262	$	1,002,778

The following tables present the amortized cost and fair value of available-for-sale debt securities as of the dates presented:


	September 30, 2023												December 31, 2022
(dollars in thousands)	Amortized Cost			Gross Unrealized Gains			Gross Unrealized Losses			Fair Value			Amortized Cost			Gross Unrealized Gains			Gross Unrealized Losses			Fair Value
U.S. Treasury securities		$	144,575		$	—		$	(14,538)		$	130,037		$	145,416		$	—		$	(13,721)		$	131,695
Obligations of U.S. government corporations and agencies		43,377			—			(1,328)			42,049			43,479			—			(1,668)			41,811
Collateralized mortgage obligations of U.S. government corporations and agencies		493,359			—			(63,381)			429,978			482,039			203			(53,835)			428,407
Residential mortgage-backed securities of U.S. government corporations and agencies		45,802			—			(8,916)			36,886			49,418			3			(7,834)			41,587
Commercial mortgage-backed securities of U.S. government corporations and agencies		312,191			—			(26,084)			286,107			352,465			—			(25,152)			327,313
Corporate obligations		—			—			—			—			500			—			—			500
Obligations of states and political subdivisions		30,391			—			(1,181)			29,210			30,788			55			(372)			30,471
Total Available-for-Sale Debt Securities(1)		$	1,069,695		$	—		$	(115,428)		$	954,267		$	1,104,105		$	261		$	(102,582)		$	1,001,784

(1) Excludes interest receivable of $3.4 million at September 30, 2023 and $3.7 million at December 31, 2022. Interest receivable is included in other assets in the Consolidated Balance Sheets.

The following tables present the fair value and the age of gross unrealized losses on available-for-sale debt securities by investment category as of the dates presented:


	September 30, 2023
	Less Than 12 Months					12 Months or More					Total
(dollars in thousands)	Number of Securities	Fair Value		Unrealized Losses		Number of Securities	Fair Value		Unrealized Losses		Number of Securities	Fair Value		Unrealized Losses
U.S. Treasury securities	1	$	9,895	$	(203)	13	$	120,142	$	(14,335)	14	$	130,037	$	(14,538)
Obligations of U.S. government corporations and agencies	—	—		—		6	42,049		(1,328)		6	42,049		(1,328)
Collateralized mortgage obligations of U.S. government corporations and agencies	8	78,608		(2,402)		57	351,370		(60,979)		65	429,978		(63,381)
Residential mortgage-backed securities of U.S. government corporations and agencies	12	319		(7)		14	36,567		(8,909)		26	36,886		(8,916)
Commercial mortgage-backed securities of U.S. government corporations and agencies	2	18,525		(591)		31	267,582		(25,493)		33	286,107		(26,084)
Obligations of states and political subdivisions	5	29,210		(1,181)		—	—		—		5	29,210		(1,181)


Total	28	$	136,557	$	(4,384)	121	$	817,710	$	(111,044)	149	$	954,267	$	(115,428)


	December 31, 2022
	Less Than 12 Months					12 Months or More					Total
(dollars in thousands)	Number of Securities	Fair Value		Unrealized Losses		Number of Securities	Fair Value		Unrealized Losses		Number of Securities	Fair Value		Unrealized Losses
U.S. Treasury securities	6	$	57,057	$	(3,363)	8	$	74,638	$	(10,358)	14	$	131,695	$	(13,721)
Obligations of U.S. government corporations and agencies	6	41,811		(1,668)		—	—		—		6	41,811		(1,668)
Collateralized mortgage obligations of U.S. government corporations and agencies	47	296,509		(28,153)		13	112,902		(25,682)		60	409,411		(53,835)
Residential mortgage-backed securities of U.S. government corporations and agencies	25	7,143		(589)		3	34,223		(7,245)		28	41,366		(7,834)
Commercial mortgage-backed securities of U.S. government corporations and agencies	30	241,009		(11,975)		7	86,304		(13,177)		37	327,313		(25,152)
Obligations of states and political subdivisions	2	20,127		(372)		—	—		—		2	20,127		(372)


Total	116	$	663,656	$	(46,120)	31	$	308,067	$	(56,462)	147	$	971,723	$	(102,582)

We evaluate securities with unrealized losses quarterly to determine if the decline in fair value has resulted from credit impairment or other factors. We do not believe any individual unrealized loss as of September 30, 2023 represents a credit impairment. There were 149 debt securities in an unrealized loss position at September 30, 2023 and 147 debt securities in an unrealized loss position at December 31, 2022. The unrealized losses on debt securities were primarily attributable to changes in interest rates and not related to the credit quality of the issuers. All debt securities were determined to be investment grade and paying principal and interest according to the contractual terms of the security. We do not intend to sell, and it is more likely than not that we will not be required to sell, the securities in an unrealized loss position before recovery of their amortized cost.

The following table presents net unrealized gains and losses, net of tax, on available-for-sale debt securities included in accumulated other comprehensive income (loss), for the periods presented:


	September 30, 2023						December 31, 2022
(dollars in thousands)	Gross Unrealized Gains		Gross Unrealized Losses		Net Unrealized Losses		Gross Unrealized Gains		Gross Unrealized Losses		Net Unrealized Losses
Total unrealized gains (losses) on available-for-sale debt securities	$	—	$	(115,428)	$	(115,428)	$	261	$	(102,582)	$	(102,321)
Income tax (expense) benefit	—		24,567		24,567		(56)		21,915		21,859
Net Unrealized Gains (Losses), Net of Tax Included in Accumulated Other Comprehensive Income (Loss)	$	—	$	(90,861)	$	(90,861)	$	205	$	(80,667)	$	(80,462)

The amortized cost and fair value of available-for-sale debt securities at September 30, 2023 by contractual maturity are included in the table below. Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.


	September 30, 2023
(dollars in thousands)	Amortized Cost		Fair Value
Obligations of the U.S. Treasury, U.S. government corporations and agencies and obligations of states and political subdivisions
Due in one year or less	$	28,010	$	27,485
Due after one year through five years	162,599		147,194
Due after five years through ten years	16,357		15,835
Due after ten years	11,377		10,782
Available-for-Sale Debt Securities With Fixed Maturities	218,343		201,296
Debt Securities without a single maturity date
Collateralized mortgage obligations of U.S. government corporations and agencies	493,359		429,978
Residential mortgage-backed securities of U.S. government corporations and agencies	45,802		36,886
Commercial mortgage-backed securities of U.S. government corporations and agencies	312,191		286,107


Total Available-for-Sale Debt Securities	$	1,069,695	$	954,267

Debt securities are pledged in order to meet various regulatory and legal requirements. Restricted pledged securities had a carrying value of $18.3 million at September 30, 2023 and $17.9 million at December 31, 2022. Unrestricted pledged securities had a carrying value of $213.2 million at September 30, 2023 and $251.5 million at December 31, 2022. Any changes to restricted pledged securities require approval of the pledge beneficiary. Approval is not required for unrestricted pledged securities.