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Securities
 6 Months Ended
Jun. 30, 2020
Debt Securities, Available-for-sale [Abstract]  
Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]
Securities
The following table summarizes the amortized cost, gross unrealized gains and losses, the allowance for credit losses and the resulting fair value of debt securities available for sale:
 
 
Amortized
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Allowance for Credit
Losses
 
Fair Value
June 30, 2020
 
(in thousands)
U.S. government agency and government-sponsored enterprise mortgage-backed securities and collateralized mortgage obligations
 
$
2,698,160

 
$
168,231

 
$
(1,361
)
 
$
—

 
$
2,865,030

Other asset-backed securities
 
215,620

 
8,729

 
(73
)
 
—

 
224,276

State and municipal securities
 
448,923

 
19,749

 
(57
)
 
—

 
468,615

U.S. government agency and government-sponsored enterprise securities
 
128,604

 
7,262

 
—

 
—

 
135,866

Total
 
$
3,491,307

 
$
203,971

 
$
(1,491
)
 
$
—

 
$
3,693,787

December 31, 2019
 
 
 
 
 
 
 
 
 
 
U.S. government agency and government-sponsored enterprise mortgage-backed securities and collateralized mortgage obligations
 
$
2,864,949

 
$
47,223

 
$
(19,222
)
 
$
—

 
$
2,892,950

Other asset-backed securities
 
194,563

 
2,476

 
(989
)
 
—

 
196,050

State and municipal securities
 
478,366

 
10,660

 
(224
)
 
—

 
488,802

U.S. government agency and government-sponsored enterprise securities
 
165,218

 
3,127

 
(5
)
 
—

 
168,340

Total
 
$
3,703,096

 
$
63,486

 
$
(20,440
)
 
$
—

 
$
3,746,142


A debt security is placed on nonaccrual status at the time any principal or interest payments become 90 days delinquent. Interest accrued but not received for a security placed on nonaccrual is reversed against interest income. There were no amounts of accrued interest reversed against interest income for the three and six months ended June 30, 2020 and 2019.
Accrued interest receivable for securities available for sale is included in “Interest receivable” on the Company’s Consolidated Balance Sheet and is not reflected in the balances in the table above. At June 30, 2020 and December 31, 2019, accrued interest receivable for securities was $12.6 million and $13.9 million, respectively. The Company does not measure an allowance for credit losses for accrued interest receivable.
The following table provides the proceeds and both gross realized gains and losses on sales of debt securities available for sale as well as other securities gains and losses for the periods indicated:
 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
 
2020
 
2019
 
2020
 
2019
 
 
(in thousands)
Proceeds from sales of debt securities available for sale
 
$
—

 
$
175,586

 
$
194,105

 
$
259,554

 
 
 
 
 
 
 
 
 
Gross realized gains from sales of debt securities available for sale
 
$
—

 
$
1,510

 
$
435

 
$
3,357

Gross realized losses from sales of debt securities available for sale
 
—

 
(1,225
)
 
(186
)
 
(1,225
)
Other securities gains (1)
 
16,425

 
—

 
16,425

 
—

Investment securities gains, net
 
$
16,425

 
$
285

 
$
16,674

 
$
2,132


__________
(1) Other securities gains includes gain from sale of Visa Class B restricted stock and subsequent write up to fair value of remaining Visa Class B shares. For additional information, please see Note 13 to the Consolidated Financial Statements in “Item 1. Financial Statements (unaudited)” of this report.
The following table provides the unrealized gains and losses on equity securities at the reporting date:
 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
 
2020
 
2019
 
2020
 
2019
 
 
(in thousands)
Gains recognized during the period on equity securities (1)
 
$
16,425

 
$
—

 
$
16,425

 
$
—

Less: Gains recognized during the period on equity securities sold during the period (1)
 
(3,000
)
 
—

 
(3,000
)
 
—

Unrealized gains recognized during the reporting period on equity securities still held at the reporting date (1)
 
$
13,425

 
$
—

 
$
13,425

 
$
—

__________
(1) Visa Class B restricted stock owned by the Company was previously carried at a zero-cost basis due to existing transfer restrictions and uncertainty of covered litigation. The sale of shares by the Company of Visa Class B restricted shares during the three months ended June 30, 2020 resulted in an observable market price. As a result, the Company adjusted the carrying value of its remaining shares of Visa Class B restricted shares upward to this observable market price.
The scheduled contractual maturities of debt securities available for sale at June 30, 2020 are presented as follows:
 
 
June 30, 2020
 
 
Amortized Cost
 
Fair Value
 
 
(in thousands)
Due within one year
 
$
53,099

 
$
53,800

Due after one year through five years
 
389,269

 
409,099

Due after five years through ten years
 
1,894,385

 
2,038,033

Due after ten years
 
1,154,554

 
1,192,855

Total debt securities available for sale
 
$
3,491,307

 
$
3,693,787


The following table summarizes the carrying value of securities pledged as collateral to secure public funds, borrowings and other purposes as permitted or required by law:
 
 
June 30, 2020
 
 
(in thousands)
To secure public funds
 
$
449,497

To secure borrowings
 
111,873

Other securities pledged
 
150,587

Total securities pledged as collateral
 
$
711,957


The following table shows the gross unrealized losses and fair value of the Company’s debt securities available for sale for which an allowance for credit losses has not been recorded, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at June 30, 2020 and December 31, 2019:
 
 
Less than 12 Months
 
12 Months or More
 
Total
 
 
Fair
Value
 
Unrealized
Losses
 
Fair
Value
 
Unrealized
Losses
 
Fair
Value
 
Unrealized
Losses
June 30, 2020
 
(in thousands)
U.S. government agency and government-sponsored enterprise mortgage-backed securities and collateralized mortgage obligations
 
$
49,116

 
$
(317
)
 
$
47,175

 
$
(1,044
)
 
$
96,291

 
$
(1,361
)
Other asset-backed securities
 
20,703

 
(73
)
 
95

 
—

 
20,798

 
(73
)
State and municipal securities
 
6,937

 
(57
)
 
—

 
—

 
6,937

 
(57
)
Total
 
$
76,756

 
$
(447
)
 
$
47,270

 
$
(1,044
)
 
$
124,026

 
$
(1,491
)
December 31, 2019
 
 
 
 
 
 
 
 
 
 
 
 
U.S. government agency and government-sponsored enterprise mortgage-backed securities and collateralized mortgage obligations
 
$
1,055,903

 
$
(12,424
)
 
$
491,539

 
$
(6,798
)
 
$
1,547,442

 
$
(19,222
)
Other asset-backed securities
 
89,508

 
(880
)
 
6,799

 
(109
)
 
96,307

 
(989
)
State and municipal securities
 
12,363

 
(142
)
 
12,587

 
(82
)
 
24,950

 
(224
)
U.S. government agency and government-sponsored enterprise securities
 
—

 
—

 
10,495

 
(5
)
 
10,495

 
(5
)
Total
 
$
1,157,774

 
$
(13,446
)
 
$
521,420

 
$
(6,994
)
 
$
1,679,194

 
$
(20,440
)

At June 30, 2020, there were 57 U.S. government agency and government-sponsored enterprise mortgage-backed securities and collateralized mortgage obligation securities in an unrealized loss position. The decline in fair value is attributable to changes in interest rates relative to where these investments fall within the yield curve and their individual characteristics. Because the Company does not intend to sell these securities nor does the Company consider it more likely than not that it will be required to sell these securities before the recovery of amortized cost basis, which may be upon maturity, the Company concluded an allowance for credit losses is unnecessary at June 30, 2020.
At June 30, 2020, there were two other asset-backed securities in an unrealized loss position. The decline in fair value is attributable to changes in interest rates relative to where these investments fall within the yield curve and their individual characteristics. Because the Company does not intend to sell these securities nor does the Company consider it more likely than not that it will be required to sell these securities before the recovery of amortized cost basis, which may be upon maturity, the Company concluded an allowance for credit losses is unnecessary at June 30, 2020.
At June 30, 2020, there were five state and municipal government securities in an unrealized loss position. The unrealized losses on state and municipal securities were caused by interest rate changes or widening of market spreads subsequent to the purchase of the individual securities. Management monitors published credit ratings of these securities for adverse changes. As of June 30, 2020, none of the rated obligations of state and local government entities held by the Company had a below investment grade credit rating. Because the credit quality of these securities are investment grade and the Company does not intend to sell these securities nor does the Company consider it more likely than not that it will be required to sell these securities before the recovery of amortized cost basis, which may be upon maturity, the Company concluded an allowance for credit losses is unnecessary at June 30, 2020.
Equity Securities without Readily Determinable Fair Values
Visa Class B Restricted Shares

In 2008, the Company received Visa Class B restricted shares as part of Visa’s initial public offering. These shares are transferable only under limited circumstances until they can be converted into publicly traded Visa Class A common shares. This conversion will not occur until the settlement of certain litigation which is indemnified by Visa members, including the Company. Visa funded an escrow account from its initial public offering to settle these litigation claims. Should this escrow account not be sufficient to cover these litigation claims, Visa is entitled to fund additional amounts to the escrow account by reducing each member bank’s Visa Class B conversion ratio to unrestricted Visa Class A shares.

During the three months ended June 30, 2020, the Company sold 17,360 shares of Visa Class B restricted stock for a gain of $3.0 million, which resulted in an observable market price. As a result, the Company adjusted the carrying value of its remaining Visa Class B restricted shares upward to this observable market price. At June 30, 2020, the Company owned 77,683 Visa Class B shares, which had a carrying value of $13.4 million.