v3.25.2
INVESTMENT SECURITIES
 6 Months Ended
Jun. 30, 2025
Investments, Debt and Equity Securities [Abstract]  
INVESTMENT SECURITIES
INVESTMENT SECURITIES

The following tables summarize the amortized cost, gross unrealized gains and losses and approximate fair value of investment securities available for sale as of June 30, 2025 and December 31, 2024.

Amortized
Cost		Gross Unrealized
Gains		Gross Unrealized
Losses		Fair
Value
Available for sale at June 30, 2025    
U.S. Government-sponsored agency securities$91,585 $— $13,346 $78,239 
State and municipal992,236 41 152,264 840,013 
U.S. Government-sponsored mortgage-backed securities503,417 1,172 75,128 429,461 
Corporate obligations10,967 — 550 10,417 
Total available for sale$1,598,205 $1,213 $241,288 $1,358,130 
Amortized
Cost		Gross Unrealized
Gains		Gross Unrealized
Losses		Fair
Value
Available for sale at December 31, 2024
U.S. Government-sponsored agency securities$95,462 $— $16,081 $79,381 
State and municipal996,541 19 133,386 863,174 
U.S. Government-sponsored mortgage-backed securities519,943 403 88,724 431,622 
Corporate obligations12,960 — 662 12,298 
Total available for sale$1,624,906 $422 $238,853 $1,386,475 
The following tables summarize the amortized cost, gross unrealized gains and losses, approximate fair value and allowance for credit losses on investment securities held to maturity as of June 30, 2025 and December 31, 2024.

Amortized
Cost		Allowance for Credit LossesNet Carrying AmountGross Unrealized
Gains		Gross Unrealized
Losses		Fair
Value
Held to maturity at June 30, 2025
U.S. Government-sponsored agency securities$334,970 $— $334,970 $— $52,156 $282,814 
State and municipal1,076,773 245 1,076,528 259 201,668 875,364 
U.S. Government-sponsored mortgage-backed securities609,828 — 609,828 — 82,266 527,562 
Foreign investment1,500 — 1,500 — — 1,500 
Total held to maturity$2,023,071 $245 $2,022,826 $259 $336,090 $1,687,240 


Amortized
Cost		Allowance for Credit LossesNet Carrying AmountGross Unrealized
Gains		Gross Unrealized
Losses		Fair
Value
Held to maturity at December 31, 2024
U.S. Government-sponsored agency securities$345,531 $— $345,531 $— $63,112 $282,419 
State and municipal1,085,921 245 1,085,676 299 185,784 900,436 
U.S. Government-sponsored mortgage-backed securities641,513 — 641,513 — 102,343 539,170 
Foreign investment1,500 — 1,500 — 5 1,495 
Total held to maturity$2,074,465 $245 $2,074,220 $299 $351,244 $1,723,520 


Accrued interest on investment securities available for sale and held to maturity at June 30, 2025 and December 31, 2024 of $22.1 million and $22.5 million, respectively, are included in the Interest Receivable line on the Corporation's Consolidated Condensed Balance Sheets. The total amount of accrued interest is excluded from the amortized cost of available for sale and held to maturity securities presented above.

In determining the allowance for credit losses on investment securities available for sale that are in an unrealized loss position, the Corporation first assesses whether it intends to sell, or it is more likely than not that it will be required to sell the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value through the income statement. For investment securities available for sale that do not meet the aforementioned criteria, the Corporation evaluates whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, the Corporation considers the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency, and adverse conditions specifically related to the security, among other factors. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded for the credit loss, limited by the amount that the fair value is less than the amortized cost basis. Unrealized losses that have not been recorded through an allowance for credit losses are recognized in other comprehensive loss. Adjustments to the allowance are reported in the income statement as a component of the provision for credit losses. The Corporation has made the accounting policy election to exclude accrued interest receivable on investment securities available for sale from the estimate of credit losses. Investment securities available for sale are charged off against the allowance or, in the absence of any allowance, written down through the income statement when deemed uncollectible or when either of the aforementioned criteria regarding intent or requirement to sell is met. The Corporation did not record an allowance for credit losses on its investment securities available for sale as the unrealized losses were attributable to changes in interest rates, not credit quality.

The allowance for credit losses on investment securities held to maturity is a contra asset-valuation account that is deducted from the amortized cost basis of investment securities held to maturity to present the net amount expected to be collected. Investment securities held to maturity are charged off against the allowance when deemed uncollectible. Adjustments to the allowance are reported in the income statement as a component of the provision for credit losses. The Corporation measures expected credit losses on investment securities held to maturity on a collective basis by major security type with each type sharing similar risk characteristics, and considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts. The Corporation has made the accounting policy election to exclude accrued interest receivable on investment securities held to maturity from the estimate of credit losses. With regard to U.S. Government-sponsored agency and U.S. Government-sponsored mortgage-backed securities, all these securities are issued by a U.S. Government-sponsored entity and have an implicit or explicit government guarantee; therefore, no allowance for credit losses has been recorded for these securities. With regard to securities issued by states and municipalities and other investment securities held to maturity, management considers (1) issuer bond ratings, (2) historical loss rates for given bond ratings, (3) the financial condition of the issuer, and (4) whether issuers continue to make timely principal and interest payments under the contractual terms of the securities. Historical loss rates associated with securities having similar grades as those in the Corporation's portfolio have been insignificant. Furthermore, as of June 30, 2025, there were no past due
principal and interest payments associated with these securities. The balance of the allowance for credit losses on investment securities held to maturity remained unchanged at $245,000 as of June 30, 2025 and December 31, 2024 based on applying the long-term historical credit rate, as published by Moody's, for similar rated securities.
On a quarterly basis, the Corporation monitors the credit quality of investment securities held to maturity through the use of credit ratings. The following table summarizes the amortized cost of investment securities held to maturity at June 30, 2025 and December 31, 2024, aggregated by credit quality indicator.
June 30, 2025
U.S. Government-sponsored agency securities (1)
State and municipal
U.S. Government-sponsored mortgage-backed securities (1)
Foreign investmentTotal
Credit Rating:
Aaa$334,970 $96,739 $609,828 $— $1,041,537 
Aa1— 179,548 — — 179,548 
Aa2— 176,970 — — 176,970 
Aa3— 183,941 — — 183,941 
A1— 65,652 — — 65,652 
A2— 20,325 — — 20,325 
Non-rated— 353,598 — 1,500 355,098 
Total$334,970 $1,076,773 $609,828 $1,500 $2,023,071 

December 31, 2024
U.S. Government-sponsored agency securities (1)
State and municipal
U.S. Government-sponsored mortgage-backed securities (1)
Foreign investmentTotal
Credit Rating:
Aaa$345,531 $120,801 $641,513 $— $1,107,845 
Aa1— 148,923 — — 148,923 
Aa2— 184,341 — — 184,341 
Aa3— 185,166 — — 185,166 
A1— 65,665 — — 65,665 
A2— 20,317 — — 20,317 
Non-rated— 360,708 — 1,500 362,208 
Total$345,531 $1,085,921 $641,513 $1,500 $2,074,465 

(1) U.S. Government agency securities and U.S. Government mortgage-backed securities are included within the Aaa credit rating category due to their explicit or implicit government guarantees, which provide a high level of assurance regarding the timely collection of principal and interest payments.

The following tables summarize, as of June 30, 2025 and December 31, 2024, investment securities available for sale in an unrealized loss position for which an allowance for credit losses has not been recorded, aggregated by security type and length of time in a continuous unrealized loss position.
Less than 12 Months12 Months or LongerTotal
Fair
Value		Gross
Unrealized
Losses		Fair
Value		Gross
Unrealized
Losses		Fair
Value		Gross
Unrealized
Losses
Investment securities available for sale at June 30, 2025
U.S. Government-sponsored agency securities$— $— $78,239 $13,346 $78,239 $13,346 
State and municipal9,675 580 828,677 151,684 838,352 152,264 
U.S. Government-sponsored mortgage-backed securities43,049 512 315,870 74,616 358,919 75,128 
Corporate obligations— — 10,386 550 10,386 550 
Total investment securities available for sale$52,724 $1,092 $1,233,172 $240,196 $1,285,896 $241,288 
Less than 12 Months12 Months or LongerTotal
Fair
Value		Gross
Unrealized
Losses		Fair
Value		Gross
Unrealized
Losses		Fair
Value		Gross
Unrealized
Losses
Investment securities available for sale at December 31, 2024
U.S. Government-sponsored agency securities$— $— $79,381 $16,081 $79,381 $16,081 
State and municipal40,398 2,115 820,663 131,271 861,061 133,386 
U.S. Government-sponsored mortgage-backed securities82,724 1,660 318,310 87,064 401,034 88,724 
Corporate obligations— — 12,268 662 12,268 662 
Total investment securities available for sale$123,122 $3,775 $1,230,622 $235,078 $1,353,744 $238,853 
The following tables summarize investment securities available for sale in an unrealized loss position for which an allowance for credit losses has not been recorded, aggregated by security type and the number of securities in the portfolio as of the dates indicated.

Gross
Unrealized
Losses		Number of Securities
Investment securities available for sale at June 30, 2025
U.S. Government-sponsored agency securities$13,346 12
State and municipal152,264 609
U.S. Government-sponsored mortgage-backed securities75,128 110
Corporate obligations550 9
Total investment securities available for sale$241,288 740 
Gross
Unrealized
Losses		Number of Securities
Investment securities available for sale at December 31, 2024
U.S. Government-sponsored agency securities$16,081 12
State and municipal133,386 611
U.S. Government-sponsored mortgage-backed securities88,724 127
Corporate obligations662 10
Total investment securities available for sale$238,853 760 

The unrealized losses in the Corporation’s investment portfolio were the result of changes in interest rates and not credit quality. As a result, the Corporation expects to recover the amortized cost basis over the term of the securities. The Corporation does not intend to sell the investments and it is not more likely than not that the Corporation will be required to sell the investments before recovery of their amortized cost basis, which may be maturity.

Certain investment securities available for sale are reported in the financial statements at an amount less than their historical cost as indicated in the table below.
June 30, 2025December 31, 2024
Investments available for sale reported at less than historical cost:  
Historical cost$1,527,184 $1,592,597 
Fair value1,285,896 1,353,744 
Gross unrealized losses$241,288 $238,853 
Percentage of the Corporation's investment securities available for sale in an unrealized loss position94.7 %97.6 %

In determining the fair value of the investment securities portfolio, the Corporation utilizes a third party for portfolio accounting services, including market value input, for those securities classified as Level 1 and Level 2 in the fair value hierarchy.  The Corporation has obtained an understanding of what inputs are being used by the vendor in pricing the portfolio and how the vendor classified these securities based upon these inputs.  From these discussions, the Corporation’s management is comfortable that the classifications are proper.  The Corporation has gained trust in the data for two reasons:  (a) independent spot testing of the data is conducted by the Corporation through obtaining market quotes from various brokers on a periodic basis; and (b) actual gains or losses resulting from the sale of certain securities has proven the data to be accurate over time.  Fair value of securities classified as Level 3 in the valuation hierarchy was determined using a discounted cash flow model that incorporated market estimates of interest rates and volatility in markets that have not been active.

The amortized cost and fair value of investment securities available for sale and held to maturity at June 30, 2025 and December 31, 2024, by contractual maturity are shown below. Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity are shown separately.

Available for SaleHeld to Maturity
Amortized CostFair ValueAmortized CostFair Value
Maturity Distribution at June 30, 2025
Due in one year or less$— $— $4,878 $4,877 
Due after one through five years12,965 12,580 121,851 117,859 
Due after five through ten years205,079 185,363 196,082 175,327 
Due after ten years876,744 730,726 1,090,432 861,615 
 1,094,788 928,669 1,413,243 1,159,678 
U.S. Government-sponsored mortgage-backed securities503,417 429,461 609,828 527,562 
Total investment securities$1,598,205 $1,358,130 $2,023,071 $1,687,240 
Available for SaleHeld to Maturity
Amortized CostFair ValueAmortized CostFair Value
Maturity Distribution at December 31, 2024
Due in one year or less$1,800 $1,795 $5,268 $5,254 
Due after one through five years12,189 11,857 124,004 117,999 
Due after five through ten years168,338 151,467 174,533 154,533 
Due after ten years922,636 789,734 1,129,147 906,564 
 1,104,963 954,853 1,432,952 1,184,350 
U.S. Government-sponsored mortgage-backed securities519,943 431,622 641,513 539,170 
Total investment securities$1,624,906 $1,386,475 $2,074,465 $1,723,520 

Securities with a carrying value of approximately $3.3 billion were pledged at June 30, 2025 and December 31, 2024 to secure certain deposits and securities sold under repurchase agreements, and for other purposes as permitted or required by law.

The book value of securities pledged and available under agreements to repurchase amounted to $135.9 million at June 30, 2025 and $173.0 million at December 31, 2024.

Gross gains and losses on the sales of investment securities available for sale for the three and six months ended June 30, 2025 and 2024 are shown below.
Three Months Ended June 30,Six Months Ended June 30,
2025202420252024
Sales and redemptions of investment securities available for sale:  
Gross gains$— $— $— $— 
Gross losses(1)(49)(8)(51)
Net gains (losses) on sales and redemptions of investment securities available for sale$(1)$(49)$(8)$(51)