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Securities
 9 Months Ended
Sep. 30, 2021
Securities [Abstract]  
Securities
4.
Securities

The amortized cost, estimated fair value and unrealized gains (losses) of AFS securities are as follows:

(In thousands)
  
Amortized
Cost
    
Unrealized
Gains
    
Unrealized
Losses
    
Estimated
Fair Value
  
As of September 30, 2021
                        
Federal agency
  
$
248,462
    
$
-
    
$
5,496
    
$
242,966
  
State & municipal
    
84,636
      
138
      
753
      
84,021
  
Mortgage-backed:
                                
Government-sponsored enterprises
    
575,884
      
10,907
      
3,959
      
582,832
  
U.S. government agency securities
    
65,762
      
1,710
      
109
      
67,363
  
Collateralized mortgage obligations:
                                
Government-sponsored enterprises
    
438,255
      
5,002
      
2,004
      
441,253
  
U.S. government agency securities
    
115,873
      
1,774
      
189
      
117,458
  
Corporate
    
38,500
      
1,637
      
-
      
40,137
  
Total AFS securities
  
$
1,567,372
    
$
21,168
    
$
12,510
    
$
1,576,030
  
As of December 31, 2020
                                
Federal agency
  
$
245,590
    
$
59
    
$
2,052
    
$
243,597
  
State & municipal
    
42,550
      
630
      
-
      
43,180
  
Mortgage-backed:
                                
Government-sponsored enterprises
    
521,448
      
17,079
      
22
      
538,505
  
U.S. government agency securities
    
55,049
      
2,332
      
47
      
57,334
  
Collateralized mortgage obligations:
                                
Government-sponsored enterprises
    
311,710
      
7,549
      
58
      
319,201
  
U.S. government agency securities
    
114,864
      
3,739
      
-
      
118,603
  
Corporate
    
27,500
      
778
      
-
      
28,278
  
Total AFS securities
  
$
1,318,711
    
$
32,166
    
$
2,179
    
$
1,348,698
  

There was no allowance for credit losses on AFS securities as of September 30, 2021 and December 31, 2020.

During the three and nine months ended September 30, 2021 there were no gains or losses reclassified out of accumulated other comprehensive income (loss) (“AOCI”) and into earnings. During the three months ended September 30, 2020 there were no gains or losses reclassified out of AOCI and into earnings. During the nine months ended September 30, 2020, there were $3 thousand of gross realized gains reclassified out of AOCI and into earnings. Included in net realized gains (losses) on AFS securities, the Company recorded gains from calls of approximately $3 thousand for the nine months ended September 30, 2020.

The amortized cost, estimated fair value and unrealized gains (losses) of HTM securities are as follows:

(In thousands)
  
Amortized
Cost
    
Unrealized
Gains
    
Unrealized
Losses
    
Estimated
Fair Value
  
As of September 30, 2021
                        
Federal agency
  
$
100,000
    
$
-
    
$
3,821
    
$
96,179
  
Mortgage-backed:
                                
Government-sponsored enterprises
    
121,040
      
2,851
      
568
      
123,323
  
U.S. government agency securities
    
9,121
      
659
      
-
      
9,780
  
Collateralized mortgage obligations:
                                
Government-sponsored enterprises
    
75,852
      
3,050
      
-
      
78,902
  
U.S. government agency securities
    
54,587
      
679
      
341
      
54,925
  
State & municipal
    
322,503
      
5,021
      
1,504
      
326,020
  
Total HTM securities
  
$
683,103
    
$
12,260
    
$
6,234
    
$
689,129
  
As of December 31, 2020
                                
Federal agency
  
$
100,000
    
$
-
    
$
1,658
    
$
98,342
  
Mortgage-backed:
                                
Government-sponsored enterprises
    
107,914
      
4,583
      
-
      
112,497
  
U.S. government agency securities
    
11,533
      
979
      
-
      
12,512
  
Collateralized mortgage obligations:
                                
Government-sponsored enterprises
    
103,105
      
4,477
      
-
      
107,582
  
U.S. government agency securities
    
79,145
      
3,950
      
-
      
83,095
  
State & municipal
    
214,863
      
7,953
      
17
      
222,799
  
Total HTM securities
  
$
616,560
    
$
21,942
    
$
1,675
    
$
636,827
  

At September 30, 2021 and December 31, 2020, all of the mortgaged-backed HTM securities were comprised of U.S. government agency and Government-sponsored enterprises securities. There was no allowance for credit losses on HTM securities as of September 30, 2021 and December 31, 2020.

Included in net realized gains (losses), the Company recorded gains from calls on HTM securities of approximately $14 thousand for the three months ended September 30, 2021 and approximately $29 thousand for the nine months ended September 30, 2021. Included in net realized gains (losses), the Company recorded gains from calls on HTM securities of approximately $11 thousand for the three months ended September 30, 2020 and approximately $15 thousand for the nine months ended September 30, 2020.

There were no sales of HTM securities during the three and nine months ended September 30, 2021. During the nine months ended September 30, 2020, the Company sold HTM securities with an amortized cost of $1.0 million and resulted in a realized loss of $1 thousand. Due to significant deterioration in the creditworthiness of the issuer of the HTM securities, the circumstances caused the Company to change its intent to hold the HTM securities sold to maturity, which did not affect the Company’s intent to hold the remainder of the HTM portfolio to maturity.

AFS and HTM securities with amortized costs totaling $1.6 billion at September 30, 2021 and $1.4 billion at December 31, 2020 were pledged to secure public deposits and for other purposes required or permitted by law. Additionally, at September 30, 2021 and December 31, 2020, AFS and HTM securities with an amortized cost of $149.2 million and $305.2 million, respectively, were pledged as collateral for securities sold under repurchase agreements.

The following tables set forth information with regard to gains and (losses) on equity securities:

  
Three Months Ended
September 30,
  
(In thousands)
  
2021
    
2020
  
Net (losses) and gains recognized on equity securities
  
$
(114
)
  
$
73
  
Less: Net (losses) and gains recognized on equity securities sold during the period
    
-
      
-
  
Unrealized (losses) and gains recognized on equity securities still held
  
$
(114
)
  
$
73
  

 
Nine Months Ended
September 30,
  
(In thousands)
  
2021
    
2020
  
Net gains and (losses) recognized on equity securities
  
$
539
    
$
(565
)
Less: Net gains and (losses) recognized on equity securities sold during the period
    
-
      
-
  
Unrealized gains and (losses) recognized on equity securities still held
  
$
539
    
$
(565
)

As of September 30, 2021 and December 31, 2020, the carrying value of equity securities without readily determinable fair values was $1.0 million and $2.0 million, respectively. The Company performed a qualitative assessment to determine whether the investments were impaired and identified no areas of concern as of September 30, 2021 and 2020. There were no impairments, downward or upward adjustments recognized for equity securities without readily determinable fair values during the three and nine months ended September 30, 2021 and 2020.

The following table sets forth information with regard to contractual maturities of debt securities at September 30, 2021:

(In thousands)
  
Amortized
Cost
    
Estimated
Fair Value
  
AFS debt securities:
            
Within one year
  
$
1,258
    
$
1,262
  
From one to five years
    
56,017
      
56,596
  
From five to ten years
    
642,112
      
639,238
  
After ten years
    
867,985
      
878,934
  
Total AFS debt securities
  
$
1,567,372
    
$
1,576,030
  
HTM debt securities:
                
Within one year
  
$
97,203
    
$
97,239
  
From one to five years
    
56,120
      
57,485
  
From five to ten years
    
226,478
      
227,026
  
After ten years
    
303,302
      
307,379
  
Total HTM debt securities
  
$
683,103
    
$
689,129
  

Maturities of mortgage-backed, collateralized mortgage obligations and asset-backed securities are stated based on their estimated average lives. Actual maturities may differ from estimated average lives or contractual maturities because, in certain cases, borrowers have the right to call or prepay obligations with or without call or prepayment penalties.

Except for U.S. government securities and government-sponsored enterprises securities, there were no holdings, when taken in the aggregate, of any single issuer that exceeded 10% of consolidated stockholders’ equity at September 30, 2021 and December 31, 2020.

The following table sets forth information with regard to investment securities with unrealized losses, for which an allowance for credit losses has not been recorded at September 30, 2021, segregated according to the length of time the securities had been in a continuous unrealized loss position:

  
Less Than 12 Months
    
12 Months or Longer
    
Total
  
(In thousands)
  
Fair
Value
    
Unrealized
Losses
    
Number
of Positions
    
Fair
Value
    
Unrealized
Losses
    
Number
of Positions
    
Fair
Value
    
Unrealized
Losses
    
Number
of Positions
  
As of September 30, 2021
                                                      
AFS securities:
                                                      
Federal agency
  
$
101,674
    
$
(1,799
)
    
7
    
$
141,292
    
$
(3,697
)
    
9
    
$
242,966
    
$
(5,496
)
    
16
  
State & municipal
    
68,492
      
(753
)
    
45
      
-
      
-
      
-
      
68,492
      
(753
)
    
45
  
Mortgage-backed
    
239,779
      
(4,060
)
    
18
      
761
      
(8
)
    
4
      
240,540
      
(4,068
)
    
22
  
Collateralized mortgage obligations
    
247,618
      
(1,793
)
    
24
      
12,816
      
(400
)
    
2
      
260,434
      
(2,193
)
    
26
  
Total securities with unrealized losses
  
$
657,563
    
$
(8,405
)
    
94
    
$
154,869
    
$
(4,105
)
    
15
    
$
812,432
    
$
(12,510
)
    
109
  
                                                                         
HTM securities:
                                                                        
Federal agency
  
$
-
    
$
-
      
-
    
$
96,179
    
$
(3,821
)
    
4
    
$
96,179
    
$
(3,821
)
    
4
  
Mortgage-backed
    
56,996
      
(568
)
    
5
      
-
      
-
      
-
      
56,996
      
(568
)
    
5
  
Collateralized mortgage obligation
     31,809
       (341 )     5
       -
       -
       -
       31,809
       (341 )     5
  
State & municipal
    
67,806
      
(1,381
)
    
50
      
3,453
      
(123
)
    
4
      
71,259
      
(1,504
)
    
54
  
Total securities with unrealized losses
  
$
156,611
    
$
(2,290
)
    
60
    
$
99,632
    
$
(3,944
)
    
8
    
$
256,243
    
$
(6,234
)
    
68
  
                                                                         
As of December 31, 2020
                                                                        
AFS securities:
                                                                        
Federal agency
  
$
148,537
    
$
(2,052
)
    
10
    
$
-
    
$
-
      
-
    
$
148,537
    
$
(2,052
)
    
10
  
Mortgage-backed
    
47,269
      
(60
)
    
3
      
800
      
(9
)
    
4
      
48,069
      
(69
)
    
7
  
Collateralized mortgage obligations
    
17,837
      
(58
)
    
6
      
-
      
-
      
-
      
17,837
      
(58
)
    
6
  
Total securities with unrealized losses
  
$
213,643
    
$
(2,170
)
    
19
    
$
800
    
$
(9
)
    
4
    
$
214,443
    
$
(2,179
)
    
23
  
                                                                         
HTM securities:
                                                                        
Federal agency
  
$
98,342
    
$
(1,658
)
    
4
    
$
-
    
$
-
      
-
    
$
98,342
    
$
(1,658
)
    
4
  
State & municipal
    
4,805
      
(17
)
    
5
      
-
      
-
      
-
      
4,805
      
(17
)
    
5
  
Total securities with unrealized losses
  
$
103,147
    
$
(1,675
)
    
9
    
$
-
    
$
-
      
-
    
$
103,147
    
$
(1,675
)
    
9
  

The Company does not believe the AFS securities that were in an unrealized loss position as of September 30, 2021 and December 31, 2020, which consisted of 109 and 23 individual securities, respectively, represented a credit loss impairment. AFS debt securities in unrealized loss positions are evaluated for impairment related to credit losses at least quarterly. As of September 30, 2021 and December 31, 2020, the majority of the AFS securities in an unrealized loss position consisted of debt securities issued by U.S. government agencies or U.S. government-sponsored enterprises that carry the explicit and/or implicit guarantee of the U.S. government, which are widely recognized as “risk-free” and have a long history of zero credit losses. Total gross unrealized losses were primarily attributable to changes in interest rates, relative to when the investment securities were purchased, and not due to the credit quality of the investment securities. The Company does not intend to sell, nor is it more likely than not that the Company will be required to sell the security before recovery of its amortized cost basis, which may be at maturity. The Company elected to exclude accrued interest receivable (“AIR”) from the amortized cost basis of debt securities. AIR on AFS debt securities totaled $3.3 million at September 30, 2021 and December 31, 2020 and is excluded from the estimate of credit losses and reported in the financial statement line for other assets.

None of the bank’s HTM debt securities were past due or on non-accrual status as of September 30, 2021 and December 31, 2020. There was no accrued interest reversed against interest income for the three and nine months ended September 30, 2021 or the year-ended December 31, 2020 as all securities remained on accrual status. In addition, there were no collateral-dependent HTM debt securities as of September 30, 2021 and December 31, 2020. As of September 30, 2021 and December 31, 2020, 53% and 65%, respectively, of the Company’s HTM debt securities were issued by U.S. government agencies or U.S. government-sponsored enterprises. These securities carry the explicit and/or implicit guarantee of the U.S. government, are widely recognized as “risk free,” and have a long history of zero credit loss. Therefore, the Company did not record an allowance for credit losses for these securities as of September 30, 2021 and December 31, 2020. The remaining HTM debt securities at September 30, 2021 and December 31, 2020 were comprised of state and municipal obligations with bond ratings of A to AAA. Utilizing the Current Expected Credit Losses (“CECL”) approach, the Company determined that the expected credit loss on its HTM municipal bond portfolio was immaterial and therefore no allowance for credit loss was recorded as of September 30, 2021 and December 31, 2020. AIR on HTM debt securities totaled $2.6 million and $2.7 million at September 30, 2021 and December 31, 2020, respectively, and is excluded from the estimate of credit losses and reported in the other assets financial statement line.