v3.26.1
Investment Securities
 6 Months Ended
Jun. 30, 2026
Investments, Debt and Equity Securities [Abstract]  
INVESTMENT SECURITIES INVESTMENT SECURITIES     
During the second quarter, the Company transferred its entire HTM securities portfolio, with an aggregate amortized cost basis of $2.3 billion, to AFS securities as part of the strategic balance sheet actions. Most of the transferred securities were subsequently sold during the quarter, resulting in a pre-tax loss of $251.3 million. As of June 30, 2026, the Company had reinvested $1.7 billion of the sale proceeds into higher-yielding, lower-duration AFS securities.
Securities Available-for-Sale
The following tables present amortized cost, gross unrealized gains and losses, and fair values of AFS securities as of the dates indicated:
June 30, 2026
AllowanceGrossGross
Amortizedfor CreditNet CarryingUnrealizedUnrealizedFair
Security TypeCostLossesAmountGainsLossesValue
(In thousands)
Agency residential MBS$928,717 $— $928,717 $— $(140,077)$788,640 
U.S. Treasury securities223,509 — 223,509 65 (99)223,475 
Agency commercial MBS151,059 — 151,059 — (1,487)149,572 
Agency residential CMOs2,625,289 — 2,625,289 1,891 (27,968)2,599,212 
Corporate debt securities254,753 (3,250)251,503 802 (14,441)237,864 
Private label residential CMOs289,337 — 289,337 46 (27,355)262,028 
Collateralized loan obligations200,307 — 200,307 213 (20)200,500 
Private label commercial MBS7,946 — 7,946 — (435)7,511 
Asset-backed securities12,114 — 12,114 67 — 12,181 
SBA securities3,220 — 3,220 — (182)3,038 
Total (1)
$4,696,251 $(3,250)$4,693,001 $3,084 $(212,064)$4,484,021 
_________________________
(1)    Excludes accrued interest receivable of $19.4 million at June 30, 2026 which is recorded in "Other assets" on the consolidated balance sheets.
December 31, 2025
AllowanceGrossGross
Amortizedfor CreditNet CarryingUnrealizedUnrealizedFair
Security TypeCostLossesAmountGainsLossesValue
(In thousands)
Agency residential MBS$972,161 $— $972,161 $— $(138,076)$834,085 
Agency commercial MBS52,022 — 52,022 44 (1,100)50,966 
Agency residential CMOs883,067 — 883,067 3,857 (15,300)871,624 
Corporate debt securities257,236 (775)256,461 576 (15,441)241,596 
Private label residential CMOs254,787 — 254,787 522 (26,334)228,975 
Collateralized loan obligations200,519 — 200,519 303 — 200,822 
Private label commercial MBS9,746 — 9,746 — (467)9,279 
Asset-backed securities13,242 — 13,242 7 — 13,249 
SBA securities3,634 — 3,634 — (172)3,462 
Total (1)
$2,646,414 $(775)$2,645,639 $5,309 $(196,890)$2,454,058 
_________________________
(1)    Excludes accrued interest receivable of $11.4 million at December 31, 2025 which is recorded in "Other assets" on the consolidated balance sheets.
See "Note 11. Fair Value Measurements and Fair Value of Financial Instruments" for information on fair value measurements and methodology.
As of June 30, 2026, AFS securities with a fair value of $694.9 million were pledged as collateral for deposits, letters of credit, and secured borrowing facilities.
Realized Gains and Losses on Securities Available-for-Sale
The following table presents the amortized cost of AFS securities sold with related gross realized gains, gross realized losses, and net realized (losses) gains for the periods indicated:
Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
(In thousands)
Amortized cost of securities sold$2,294,702 $— $2,294,702 $— 
Gross realized gains$1,893 $— $1,893 $— 
Gross realized losses(253,193)— (253,193)— 
Net loss on sale of securities(251,300)— (251,300)— 
Unrealized Losses on Securities Available-for-Sale
The following tables present the gross unrealized losses and fair values of AFS securities that were in unrealized loss positions as of the dates indicated:
June 30, 2026
Less Than 12 Months12 Months or MoreTotal
GrossGrossGross
FairUnrealizedFairUnrealizedFairUnrealized
Security TypeValueLossesValueLossesValueLosses
(In thousands)
Agency residential MBS$— $— $788,640 $(140,077)$788,640 $(140,077)
U.S. Treasury securities124,513 (99)— — 124,513 (99)
Agency commercial MBS117,322 (794)32,250 (693)149,572 (1,487)
Agency residential CMOs1,757,288 (12,802)86,876 (15,166)1,844,164 (27,968)
Corporate debt securities35,659 (5,841)173,652 (8,600)209,311 (14,441)
Private label residential CMOs99,584 (598)121,078 (26,757)220,662 (27,355)
Collateralized loan obligations17,880 (20)— — 17,880 (20)
Private label commercial MBS— — 7,511 (435)7,511 (435)
SBA securities— — 3,038 (182)3,038 (182)
Total$2,152,246 $(20,154)$1,213,045 $(191,910)$3,365,291 $(212,064)

December 31, 2025
Less Than 12 Months12 Months or MoreTotal
GrossGrossGross
FairUnrealizedFairUnrealizedFairUnrealized
Security TypeValueLossesValueLossesValueLosses
(In thousands)
Agency residential MBS$— $— $834,085 $(138,076)$834,085 $(138,076)
Agency commercial MBS4,994 (6)32,006 (1,094)37,000 (1,100)
Agency residential CMOs70,270 (117)101,501 (15,183)171,771 (15,300)
Corporate debt securities— — 188,545 (15,441)188,545 (15,441)
Private label residential CMOs19,672 (8)127,020 (26,326)146,692 (26,334)
Private label commercial MBS— — 9,279 (467)9,279 (467)
SBA securities— — 3,462 (172)3,462 (172)
Total$94,936 $(131)$1,295,898 $(196,759)$1,390,834 $(196,890)
At June 30, 2026, the Company evaluated all securities in an unrealized loss position to determine whether any portion of the unrealized losses were attributable to credit related factors. As a result of this assessment, an ACL of $3.3 million was recorded on one corporate debt security classified as AFS.
As of June 30, 2026, two securities that were transferred to AFS as part of the securities repositioning remained unsold. Given the Company's intent to sell these securities, unrealized losses of $5.4 million were recorded in loss on securities AFS.
For all other securities in unrealized loss positions, the loss was attributable to changes in market interest rates and other market conditions, rather than credit deterioration of the underlying issuers. In making this determination, we considered several factors, including credit ratings and financial condition of the issuers, the seniority of the tranches, and any U.S. government agency guarantees. For these remaining securities in an unrealized loss position, the Company does not intend to sell them, and it is not more likely than not that the Company will be required to sell them before recovery of their amortized cost basis. Except for the credit losses and two positions recognized at fair value, the remaining unrealized losses continue to be recorded in accumulated other comprehensive loss within stockholders' equity.
Contractual Maturities of Securities Available-for-Sale
The following tables present the contractual maturities of our AFS securities portfolio based on amortized cost and fair value as of the dates indicated:
June 30, 2026
Due WithinDue after One YearDue After Five YearsDue After
Security TypeOne YearThrough Five YearsThrough Ten YearsTen YearsTotal
(In thousands)
Amortized Cost:
Agency residential MBS$— $— $— $928,717 $928,717 
U.S. Treasury securities— 223,509 — — 223,509 
Agency commercial MBS— 40,179 — 110,880 151,059 
Agency residential CMOs— — 13,028 2,612,261 2,625,289 
Corporate debt securities— 130,139 124,614 — 254,753 
Private label residential CMOs— — — 289,337 289,337 
Collateralized loan obligations— — 93,763 106,544 200,307 
Private label commercial MBS— — 4,870 3,076 7,946 
Asset-backed securities— — — 12,114 12,114 
SBA securities— — 3,220 — 3,220 
Total amortized cost$— $393,827 $239,495 $4,062,929 $4,696,251 
Fair Value:
Agency residential MBS$— $— $— $788,640 $788,640 
U.S. Treasury securities— 223,475 — — 223,475 
Agency commercial MBS— 40,031 — 109,541 149,572 
Agency residential CMOs— — 13,207 2,586,005 2,599,212 
Corporate debt securities— 123,070 114,794 — 237,864 
Private label residential CMOs— — — 262,028 262,028 
Collateralized loan obligations— — 93,775 106,725 200,500 
Private label commercial MBS— — 4,573 2,938 7,511 
Asset-backed securities— — — 12,181 12,181 
SBA securities— — 3,038 — 3,038 
Total fair value$— $386,576 $229,387 $3,868,058 $4,484,021 
CMBS, CMOs, and MBS have contractual maturity dates, but require periodic payments based upon scheduled amortization terms. Actual principal collections on these securities usually occur more rapidly than the scheduled amortization terms because of prepayments made by obligors of the underlying loan collateral.
Securities Held-to-Maturity
As a result of the securities repositioning, the Company did not hold any securities classified as HTM as of June 30, 2026. The amortized cost, ACL, gross unrealized gains and losses, and fair values of HTM securities as of December 31, 2025 are as follows:
December 31, 2025
AmortizedAllowance forNet CarryingGross UnrealizedGross UnrealizedFair
Security TypeCostCredit LossesAmountGainsLossesValue
(In thousands)
Municipal securities $1,237,792 $(20)$1,237,772 $2,052 $(20,713)$1,219,111 
Agency commercial MBS447,283 — 447,283 — (19,645)427,638 
Private label commercial MBS360,382 — 360,382 — (9,606)350,776 
U.S. Treasury securities193,022 — 193,022 — (7,934)185,088 
Corporate debt securities70,852 (675)70,177 — (6,264)63,913 
Total (1)
$2,309,331 $(695)$2,308,636 $2,052 $(64,162)$2,246,526 
__________________________
(1)    Excludes accrued interest receivable of $13.4 million at December 31, 2025 which is recorded in "Other assets" on the consolidated balance sheets.
Allowance for Credit Losses on Securities Held-to-Maturity
Credit losses on HTM securities are recorded at the time of purchase, acquisition, or when the Company designates securities as HTM. The ACL on HTM securities represents CECL that may be incurred over the life of the investment. Accrued interest receivable on HTM securities, which is included in "Other assets" on the consolidated balance sheets, is excluded from the estimate of expected credit losses. HTM U.S. Treasury securities and agency-backed MBS securities are considered to have no risk of loss as they are either explicitly or implicitly guaranteed by the U.S. government. The change in fair value in the HTM private label CMBS portfolio is solely driven by changes in interest rates. The Company has no knowledge of any underlying credit issues and the cash flows underlying the debt securities have not changed and are not expected to be impacted by changes in interest rates and, thus, there is no related ACL for this portfolio. The underlying bonds in the Company’s HTM municipal securities and HTM corporate debt securities portfolios are evaluated for credit losses in conjunction with management’s estimate of the ACL based primarily on credit ratings. As of December 31, 2025, the company recorded an ACL on HTM securities of $0.7 million.
Securities Held-to-Maturity by Credit Quality Indicator
The Company uses Standard & Poor's, Moody's, Fitch, Kroll, and Egan Jones ratings as the credit quality indicators for its HTM securities. The following tables present our HTM securities portfolio by the lowest available credit rating as of December 31, 2025:
December 31, 2025
Security TypeAAAAA+AAAA-BBBNRTotal
(In thousands)
Amortized Cost:
Municipal securities$567,140 $363,823 $220,823 $84,302 $1,704 $— $1,237,792 
Agency commercial MBS— 447,283 — — — — 447,283 
Private label commercial MBS360,382 — — — — — 360,382 
U.S. Treasury securities— 193,022 — — — — 193,022 
Corporate debt securities— — — — 44,646 26,206 70,852 
Total$927,522 $1,004,128 $220,823 $84,302 $46,350 $26,206 $2,309,331 
Interest Income on Investment Securities
The following table presents the composition of our interest income on investment securities for the periods indicated:
Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
(In thousands)
Taxable interest$35,858 $30,766 $69,826 $62,213 
Non-taxable interest3,527 4,547 7,890 9,064 
Dividend income3,022 2,303 6,564 4,201 
Total interest income on investment securities$42,407 $37,616 $84,280 $75,478