Note 8 - Investment Securities

3 Months Ended

Mar. 31, 2023

Notes to Financial Statements

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

8. Investment Securities

The following tables set forth the amortized cost, gross unrealized gains, gross unrealized losses, and fair value of securities available-for-sale as of March 31, 2023, and December 31, 2022:

	March 31, 2023
			Gross		Gross
	Amortized		Unrealized		Unrealized
	Cost		Gains		Losses		Fair Value
	(In thousands)
Securities Available-for-Sale
U.S. treasury securities	$	270,165	$	34	$	501	$	269,698
U.S. government agency entities		59,734		324		127		59,931
U.S. government sponsored entities		40,000		14		—		40,014
Mortgage-backed securities .		969,966		401		113,065		857,302
Collateralized mortgage obligations		33,877		—		2,910		30,967
Corporate debt securities		298,698		265		15,625		283,338
Total	$	1,672,440	$	1,038	$	132,228	$	1,541,250

	December 31, 2022
			Gross		Gross
	Amortized		Unrealized		Unrealized
	Cost		Gains		Losses		Fair Value
	(In thousands)
Securities Available-for-Sale
U.S. treasury securities	$	241,611	$	—	$	1,111	$	240,500
U.S. government agency entities		63,347		384		121		63,610
U.S. government sponsored entities		30,000		—		—		30,000
Mortgage-backed securities .		993,883		194		126,983		867,094
Collateralized mortgage obligations		34,552		—		3,491		31,061
Corporate debt securities		258,780		112		17,809		241,083
Total	$	1,622,173	$	690	$	149,515	$	1,473,348

As of March 31, 2023, the amortized cost of AFS debt securities excluded accrued interest receivables of $5.9 million, which are included in “accrued interest receivable” on the Consolidated Balance Sheets. For the Company’s accounting policy related to AFS debt securities’ accrued interest receivable, see Note 1 - Summary of Significant Accounting Policies – Securities Available for Sale – Allowance for Credit Losses on Available for Sale Securities to the Consolidated Financial Statements in the Company’s 2022 Form 10-K.

The amortized cost and fair value of securities available-for-sale as of March 31, 2023, by contractual maturities, are set forth in the tables below. Actual maturities may differ from contractual maturities because borrowers may have the right to call or repay obligations with or without call or repayment penalties.  

	March 31, 2023
	Securities Available-For-Sale
	Amortized Cost		Fair Value
	(In thousands)
Due in one year or less	$	350,165	$	348,984
Due after one year through five years		256,256		241,910
Due after five years through ten years		169,294		160,169
Due after ten years		896,725		790,187
Total	$	1,672,440	$	1,541,250

Equity Securities - The Company recognized a net gain of $4.9 million for the three months ended March 31, 2023, due to an increase in fair value during the quarter of equity investments with readily determinable fair values compared to a net gain of $5.9 million for the three months ended March 31, 2022. Equity securities were $27.0 million and $22.2 million as of March 31, 2023, and December 31, 2022, respectively.

The following tables set forth the gross unrealized losses and related fair value of the Company’s investment portfolio, aggregated by investment category and the length of time that individual security has been in a continuous unrealized loss position, as of  March 31, 2023, and  December 31, 2022:

	March 31, 2023
	Less than 12 Months				12 Months or Longer				Total
			Gross				Gross				Gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Losses		Value		Losses		Value		Losses
	(In thousands)
Securities Available-for-Sale
U.S. treasury securities	$	172,306	$	501	$	—	$	—	$	172,306	$	501
U.S. government agency entities		6,617		3		1,676		124		8,293		127
Mortgage-backed securities.		127,422		4,819		709,405		108,246		836,827		113,065
Collateralized mortgage obligations		24,326		1,206		6,641		1,704		30,967		2,910
Corporate debt securities		98,411		1,589		114,663		14,036		213,074		15,625
Total	$	429,082	$	8,118	$	832,385	$	124,110	$	1,261,467	$	132,228

	December 31, 2022
	Less than 12 Months				12 Months or Longer				Total
			Gross				Gross				Gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Losses		Value		Losses		Value		Losses
	(In thousands)
Securities Available-for-Sale
U.S. treasury securities	$	240,500	$	1,111	$	—	$	—	$	240,500	$	1,111
U.S. government agency entities		—		—		1,806		121		1,806		121
Mortgage-backed securities .		394,123		33,042		452,739		93,941		846,862		126,983
Collateralized mortgage obligations		24,427		1,614		6,634		1,877		31,061		3,491
Corporate debt securities		109,995		3,256		100,977		14,553		210,972		17,809
Total	$	769,045	$	39,023	$	562,156	$	110,492	$	1,331,201	$	149,515

As of March 31, 2023, the Company had a total of 193 AFS debt securities in a gross unrealized loss position with no credit impairment, consisting primarily of 158 mortgage-backed securities, and 21 Corporate debt securities. In comparison, as of December 31, 2022, the Company has a total of 195 AFS debt securities in a gross unrealized loss position with no impairment, consisting primarily of 159 mortgage-backed securities, 22 Corporate debt securities, six U.S. treasury securities, five collateralized mortgage obligations and three U.S. government agency securities.

In March 2023, the Company recorded a $3.0 million write-off of its holdings of debt securities from the failed Signature Bank.

Allowance for Credit Losses

The securities that were in an unrealized loss position at March 31, 2023, were evaluated to determine whether the decline in fair value below the amortized cost basis resulted from a credit loss or other factors. For a discussion of the factors and criteria the Company uses in analyzing securities for impairment related to credit losses, see Note 1 - Summary of Significant Accounting Policies - Allowance for Credit Losses on Available for Sale Securities to the Consolidated Financial Statements in the Company’s 2022 Form 10-K.

The Company concluded the unrealized losses were primarily attributed to yield curve movement, together with widened liquidity spreads and credit spreads. The issuers have not, to the Company’s knowledge, established any cause for default on these securities. The Company expects to recover the amortized cost basis of its securities and has no present intent to sell and will not be required to sell available-for-sale securities that have declined below their cost before their anticipated recovery. Accordingly, no allowance for credit losses was recorded as of March 31, 2023, against these securities, and there was no provision for credit losses recognized for the three months ended March 31, 2023.

Securities available-for-sale having a carrying value of $144.0 million and $145.7 million as of March 31, 2023, and December 31, 2022, respectively, were pledged to secure public deposits and other borrowings.