10-Q 1 brhc10037331_10q.htm 10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022

or

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to ________

Commission File Number:  000-26099

FARMERS & MERCHANTS BANCORP
(Exact name of registrant as specified in its charter)

Delaware
 
94-3327828
(State or other jurisdiction of incorporation or organization)
 
(I.R.S. Employer Identification No.)

111 W. Pine Street, Lodi, California
 
95240
(Address of principal executive offices)
 
(Zip Code)

Registrant’s telephone number, including area code (209) 367-2300

Securities registered pursuant to Section 12(b) of the Act:

Title of each class
Trading Symbol(s)
Name of each exchange on which registered
None
Not Applicable
Not Applicable

Securities registered pursuant to Section 12(g) of the Act:  Common Stock, $0.01 Par Value Per Share

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days Yes  No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes  No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer
Accelerated filer 
Non-accelerated filer
Smaller reporting company
Emerging growth company  

 If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes   No 

As of April 30, 2022, the registrant had 783,924 shares of common stock $0.01 par value per share, outstanding.



FARMERS & MERCHANTS BANCORP
FORM 10-Q

TABLE OF CONTENTS

PART I. - FINANCIAL INFORMATION
Page
       
 
Item 1 - Financial Statements
 
   
4
   
5
   
6
   
7
   
8
   
9
   
 
 
  33
   
34
   
39
   
44
   
 
 
 
59
   
 
 
  59
       
PART II. - OTHER INFORMATION
 
       
  59
  59
  59
  59
  59
  59
  60
  61

Special Note Regarding Forward-Looking Statements

Certain matters in this Quarterly Report on Form 10-Q contains various forward-looking statements, usually containing the words “estimate,” “project,” “expect,” “objective,” “goal,” or similar expressions and includes assumptions concerning Farmers & Merchants Bancorp’s (together with its subsidiaries, the “Company”, “FMCB”, or “we”) operations, future results, and prospects. These forward-looking statements are based upon current expectations and are subject to risks and uncertainties. In connection with the “safe-harbor” provisions of the Private Securities Litigation Reform Act of 1995, the Company provides the following cautionary statement identifying important factors which could cause the actual results of events to differ materially from those set forth in or implied by the forward-looking statements and related assumptions.

Such factors include, but are not limited to, the following: (1) economic conditions in the mid Central Valley or the East Bay region of San Francisco in California; (2) significant changes in interest rates and loan prepayment speeds; (3) credit risks of lending and investment activities; (4) changes in federal and state banking laws or regulations; (5) competitive pressure in the banking industry; (6) changes in governmental fiscal or monetary policies; (7) the possible adverse impacts on the banking industry and our business from a period of significant, prolonged inflation; (8) uncertainty regarding the economic outlook resulting from the continuing war on terrorism, as well as actions taken or to be taken by the U.S. or other governments as a result of further acts or threats of terrorism; (9) water management issues in California and the resulting impact on the Company’s agricultural and industrial customers; (10) expansion into new geographic markets and new lines of business; (11) the impact of COVID-19 (Coronavirus) on the Company and its customers (see COVID-19 Disclosure below); (12) the impact of changes in Federal and State taxation policies and rates; and (13) other factors discussed in “Item 1A. Risk Factors” on our Annual Report on Form 10-K filed with the SEC on March 15, 2022.

Readers are cautioned not to place undue reliance on these forward-looking statements which speak only as of the date hereof. The Company undertakes no obligation to update any forward-looking statements to reflect events or circumstances arising after the date on which they are made.

PART 1. FINANCIAL INFORMATION

Item 1.
Financial Statements

FARMERS & MERCHANTS BANCORP
UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(Dollars in thousands, except share and per share amounts)
 
March 31,
2022
   
December 31,
2021
 
ASSETS
           
Cash and due from banks
 
$
68,774
   
$
52,499
 
Interest bearing deposits with banks
   
772,312
     
662,961
 
Total cash and cash equivalents
   
841,086
     
715,460
 
Securities available for sale, at fair value
   
251,375
     
270,454
 
Securities held to maturity, at amortized cost
   
876,257
     
737,052
 
Total investment securities
   
1,127,632
     
1,007,506
 
Non-marketable securities
   
15,549
     
15,549
 
Loans and leases held for investment
   
3,237,619
     
3,237,177
 
Allowance for credit losses
   
(61,032
)
   
(61,007
)
Loans held for investment, net
   
3,176,587
     
3,176,170
 
Bank-owned life insurance
   
71,953
     
71,411
 
Premises and equipment, net
   
47,423
     
47,730
 
Deferred income tax assets
   
30,361
     
25,542
 
Accrued interest receivable
   
14,473
     
18,098
 
Goodwill
   
11,183
     
11,183
 
Other intangibles
   
3,254
     
3,402
 
Other real estate owned
   
873
     
873
 
Other assets
   
83,802
     
84,796
 
TOTAL ASSETS
 
$
5,424,176
   
$
5,177,720
 
                 
LIABILITIES AND SHAREHOLDERS’ EQUITY
               
Deposits:
               
Noninterest bearing
 
$
1,764,857
   
$
1,750,330
 
Interest bearing:
               
Demand
   
1,124,470
     
1,097,337
 
Savings and money market
   
1,557,332
     
1,400,000
 
Certificate of deposits
   
390,780
     
392,485
 
Total interest bearing
   
3,072,582
     
2,889,822
 
Total deposits
   
4,837,439
     
4,640,152
 
Subordinated debentures
   
10,310
     
10,310
 
Interest payable and other liabilities
   
111,714
     
64,122
 
TOTAL LIABILITIES
   
4,959,463
     
4,714,584
 
                 
SHAREHOLDERS’ EQUITY
               
Preferred shares, no par value, 1,000,000 shares authorized and, none issued or outstanding
   
-
     
-
 
Common shares, $0.01 par value, 7,500,000 authorized 785,146 and 789,646 outstanding at March 31, 2022 and December 31, 2021, respectively
   
8
     
8
 
Additional paid in capital
   
73,264
     
77,516
 
Retained earnings
   
404,389
     
387,331
 
Accumulated other comprehensive (loss), net of taxes
   
(12,948
)
   
(1,719
)
TOTAL SHAREHOLDERS’ EQUITY
   
464,713
     
463,136
 
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
 
$
5,424,176
   
$
5,177,720
 

FARMERS & MERCHANTS BANCORP
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME

   
Three Months Ended
March 31,
 
(Dollars in thousands, except share and per share amounts)
 
2022
   
2021
 
Interest income
           
Interest and fees on loans and leases
 
$
37,433
   
$
37,087
 
Interest and dividends on investments
   
5,295
     
4,417
 
Interest on deposits with others
   
366
     
103
 
Total interest income
   
43,094
     
41,607
 
                 
Interest expense
               
Deposits
   
803
     
1,237
 
Subordinated debentures
   
82
     
79
 
Total interest expense
   
885
     
1,316
 
Net interest income
   
42,209
     
40,291
 
Provision for credit losses
   
-
     
1,250
 
Net interest income after provision for credit losses
   
42,209
     
39,041
 
Noninterest income
               
Card processing
   
1,737
     
1,579
 
Service charges on deposit accounts
   
850
     
638
 
Increase in cash surrender value of BOLI
   
542
     
526
 
Gain on sale of investment securities
   
-
     
1,840
 
Net gain/(loss) on deferred compensation benefits
   
412
     
3,540
 
Other
   
771
     
1,412
 
Total noninterest income
   
4,312
     
9,535
 
Noninterest expense
               
Salaries and employee benefits
   
16,784
     
16,740
 
Net gain/(loss) on deferred compensation benefits
   
412
     
3,540
 
Occupancy
   
1,154
     
1,231
 
Data processing
   
1,215
     
1,224
 
FDIC insurance
   
349
     
287
 
Marketing
   
316
     
188
 
Legal
   
279
     
111
 
Other
   
3,279
     
3,042
 
Total noninterest expense
   
23,788
     
26,363
 
INCOME BEFORE INCOME TAXES
   
22,733
     
22,213
 
Income tax expense
   
5,675
     
5,500
 
NET INCOME
 
$
17,058
   
$
16,713
 
                 
Earnings per common share:
               
Basic
 
$
21.70
   
$
21.17
 
Diluted
 
$
21.70
   
$
21.17
 
                 
Weighted average number of common shares
               
Basic
   
786,096
     
789,646
 
Diluted
   
786,096
     
789,646
 

FARMERS & MERCHANTS BANCORP
UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

   
Three Months Ended
March 31,
 
(Dollars in thousands)
 
2022
   
2021
 
Net income
 
$
17,058
   
$
16,713
 
Other comprehensive income                
Unrealized holding (losses)/gains on securities available for sale
   
(15,865
)
   
(18,566
)
Reclassification adjustment for (gains)/losses on available for sale securities
   
-
     
(1,840
)
Amortization of unrealized loss on securities transferred to held to maturity
   
(77
)
   
(58
)
Net unrealized holding (losses)/gains on securities available for sale
   
(15,942
)
   
(20,464
)
Income tax benefit/(expense)
   
4,713
     
6,049
 
Other comprehensive (loss)/income, net of tax
   
(11,229
)
   
(14,415
)
Total comprehensive income
 
$
5,829
   
$
2,298
 

FARMERS & MERCHANTS BANCORP
UNAUDITED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

(Dollars in thousands, except share amounts)
 
Common
Shares
   
Amount
   
Additional
Paid In
Capital
   
Retained
Earnings
   
Accumulated
Other
Comprehensive
(Loss)
   
Total
 
Balance as of December 31, 2020
   
789,646
   
$
8
   
$
77,516
   
$
333,070
   
$
13,071
   
$
423,665
 
Net income
   
-
     
-
     
-
     
16,713
     
-
     
16,713
 
Other comprehensive (loss), net of tax
   
-
     
-
     
-
     
-
     
(14,415
)
   
(14,415
)
Cash dividends returned
   
-
     
-
     
-
     
7
     
-
     
7
 
Balance as of March 31, 2021
   
789,646
   
$
8
   
$
77,516
   
$
349,790
   
$
(1,344
)
 
$
425,970
 
                                                 
Balance as of December 31, 2021
   
789,646
   
$
8
   
$
77,516
   
$
387,331
   
$
(1,719
)
 
$
463,136
 
Net income
   
-
     
-
     
-
     
17,058
     
-
     
17,058
 
Other comprehensive (loss), net of tax
   
-
     
-
     
-
     
-
     
(11,229
)
   
(11,229
)
Repurchase of common stock
   
(4,500
)
   
-
     
(4,252
)
   
-
     
-
     
(4,252
)
Balance as of March 31, 2022
   
785,146
   
$
8
   
$
73,264
   
$
404,389
   
$
(12,948
)
 
$
464,713
 

FARMERS & MERCHANTS BANCORP
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

   
Three Months Ended
March 31,
 
(Dollars in thousands)
 
2022
   
2021
 
Cash flows from operating activities:
           
Net income
 
$
17,058
   
$
16,713
 
Adjustments to reconcile net income to net cash provided by operating activities:
               
Provision for credit losses
   
-
     
1,250
 
Depreciation and amortization
   
656
     
660
 
Net amortization of securities premiums and discounts
   
176
     
407
 
Increase in cash surrender value of BOLI
   
(542
)
   
(527
)
(Increase)/decrease in deferred income taxes, net
   
(113
)
   
4,714
 
Gains on sale of securities available for sale
   
-
     
(1,840
)
Net changes in:
               
Other assets
   
4,709
     
6,258
 
Other liabilities
   
6,966
     
1,386
 
Net cash provided by operating activities
   
28,910
     
29,021
 
Cash flows from investing activities:
               
Net change in loans held for investment
   
(374
)
   
(11,340
)
Purchase of available for sale securities
   
(10,067
)
   
(199,440
)
Purchase of held to maturity securities
   
(118,162
)
   
(3,211
)
Maturities/sales of available for sale securities
   
13,097
     
110,388
 
Maturities of held to maturity securities
   
19,516
     
3,930
 
Purchase of premises and equipment
   
(363
)
   
(100
)
Purchase of other investments
   
-
     
(632
)
Proceeds from sale of assets
   
34
     
-
 
Net cash used in investing activities
   
(96,319
)
   
(100,405
)
Cash flows from financing activities:
               
Net increase in deposits
   
197,287
     
180,947
 
Net cash used in share repurchase program
   
(4,252
)
   
-
 
Cash dividends returned
   
-
     
7
 
Net provided by financing activities
   
193,035
     
180,954
 
Net change in cash and cash equivalents
   
125,626
     
109,570
 
Cash and cash equivalents, beginning of period
   
715,460
     
383,837
 
Cash and cash equivalents, end of period
 
$
841,086
   
$
493,407
 
                 
Supplemental disclosures of cash flow information:
               
Cash paid for interest
 
$
951
   
$
1,943
 
                 
Supplemental disclosures of non-cash transactions:
               
Investment securities available for sale transferred to held to maturity
 
$
-
   
$
316,925
 
Security purchases settled in subsequent period
 
$
(40,626
)
 
$
-
 
Unrealized losses on securities available for sale
 
$
(15,865
)
 
$
(20,406
)

FARMERS & MERCHANTS BANCORP
NOTES TO UNAUDITED CONSOLIDATED STATEMENTS


Note 1—Basis of Presentation and Significant Accounting Policies

The accompanying unaudited consolidated financial statements include the accounts Farmers & Merchants Bancorp (“FMCB” or “Bancorp”), a bank holding company incorporated in the State of Delaware and its wholly owned subsidiary, Farmers & Merchants Bank of Central California (“FMB” or “Bank”) collectively (the “Company”).

These unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X as promulgated by the Securities and Exchange Commission (“SEC”). In preparing these financial statements, the Company has evaluated events and transactions subsequent to March 31, 2022 for potential recognition or disclosure. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of the financial position and results of operations for the periods presented have been included. Certain information and note disclosures have been condensed or omitted pursuant to the rules and regulations of the SEC and the accounting standards for interim financial statements. Certain reclassifications have been made to the 2021 Consolidated Financial Statements and/or schedules to conform to the 2022 presentation. All significant intercompany transactions and balances have been eliminated.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect amounts reported in the financial statements. Various elements of the Company’s accounting policies, by their nature, are inherently subject to estimation techniques, valuation assumptions and other subjective assessments. In particular, management has identified several accounting policies that, due to the judgments, estimates and assumptions inherent in those policies, are significant to an understanding of Bank’s financial statements. These policies relate to: (i) the methodology for the recognition of interest income; (ii) the determination of the provision and allowance for credit losses; (iii) the valuation of financial assets and liabilities recorded at fair value; (iv) the valuation of intangibles, such as goodwill and core deposit intangibles (“CDI”); (v) the valuation of other real estate owned (“OREO”); and (vi) the valuation or recognition of deferred tax assets and liabilities. These policies and judgments, estimates and assumptions are described in greater detail in subsequent notes to the Consolidated Financial Statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations, Summary of Critical Accounting Policies and Estimates, in our Annual Report on Form 10-K for the year ended December 31, 2021 filed with the SEC on March 15, 2022 and Item 2 - Management’s Discussion and Analysis of Financial Condition and Results of Operations Summary of Critical Accounting Policies and Estimates included in this Quarterly Report on Form 10-Q.

The information included in this Form 10-Q should be read in conjunction with our 2021 Form 10-K. Interim results are not necessarily indicative of results for a full year or any other interim period.

Impact of recent authoritative accounting guidance The Accounting Standards Codification™ (“ASC”) is the FASB officially recognized source of authoritative GAAP applicable to all public and non-public non-governmental entities.  Periodically, the FASB will issue Accounting Standard updates (“ASU”) to its ASC.  Rules and interpretive releases of the SEC under the authority of the federal securities laws are also sources of authoritative GAAP for the Company as an SEC registrant. All other accounting literature is non-authoritative.

9


FARMERS & MERCHANTS BANCORP
NOTES TO UNAUDITED CONSOLIDATED STATEMENTS (CONTINUED)
Note 1—Basis of Presentation and Significant Accounting Policies—Continued

On January 1, 2022, the Company adopted the Financial Accounting Standards Board (“FASB”) Accounting Standards Update (ASU) 2016-13, Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments, as amended, which replaces the incurred loss methodology that delays recognition until it is probable a loss has been incurred with an expected loss methodology that is referred to as CECL.


In adopting ASU 2016-13 (Topic 326) Management determined that the Weighted Average Remaining Maturity (“WARM”) method was most appropriate given the Company’s current size and complexity.



The implementation of the WARM method did not result in any material change in the calculation of the Company’s December 31, 2021 Allowance for Credit Losses, therefore, no adjustment to Shareholders’ Equity was made as of January 1, 2022.

The main objective of this ASU is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. The ASU affects loans, debt securities, trade receivables, net investments in leases, off-balance-sheet credit exposures, reinsurance receivables, and any other financial asset not excluded from the scope that have the contractual right to receive cash. The ASU replaces the incurred loss impairment methodology in previous GAAP with CECL, a methodology that reflects current expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. This ASU requires a financial asset (or group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial asset(s) to present the net carrying value at the amount expected to be collected on the financial asset. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. This ASU broadens the information that an entity must consider in developing its expected credit loss estimate for assets measured either collectively or individually. The use of forecasted information incorporates more timely information in the estimate of expected credit loss, which will be more decision useful to users of the financial statements.

The following table illustrates the pre-tax impact of the adoption of this ASU:

 
 
January-2022
 
 
 
Reported
   
Reported
   
Impact of
 
 
 
under
   
Pre-
   
ASC 326
 
(Dollars in thousands)
 
ASC 326
   
Adoption
   
Adoption
 
Allowance for credit losses:
                 
Real estate:
                 
Commercial
 
$
(17,379
)
 
$
(28,536
)
 
$
11,157
 
Agricultural
   
(14,580
)
   
(9,613
)
   
(4,967
)
Residential and home equity
   
(5,879
)
   
(2,847
)
   
(3,032
)
Construction
   
(3,311
)
   
(1,456
)
   
(1,855
)
Total real estate
   
(41,149
)
   
(42,452
)
   
1,303
 
Commercial & industrial
   
(11,417
)
   
(11,489
)
   
72
 
Agricultural
   
(6,363
)
   
(5,465
)
   
(898
)
Commercial leases
   
(1,567
)
   
(938
)
   
(629
)
Consumer and other
   
(511
)
   
(663
)
   
152
 
Total allowance for credit losses
 
$
(61,007
)
 
$
(61,007
)
 
$
-
 
 

10


FARMERS & MERCHANTS BANCORP
NOTES TO UNAUDITED CONSOLIDATED STATEMENTS (CONTINUED)
Note 1—Basis of Presentation and Significant Accounting Policies—Continued

Subsequent events  The Company has evaluated events occurring subsequent to March 31, 2022 for disclosure in the consolidated financial statements.


Note 2Risks and Uncertainties

The COVID-19 pandemic has affected the economy and businesses throughout the U.S., in California and in the markets served by the Company. Designated as an “essential business”, the Company’s subsidiary, Farmers & Merchants Bank of Central California, has kept all branches open and maintained regular business hours during the COVID-19 pandemic. Our staffing levels have remained stable during the COVID-19 pandemic.

Through the CARES Act and H.R. 133, as well as related federal and state regulatory actions, the federal government has taken extraordinary efforts to provide financial assistance to individuals and companies to help them move through these difficult times. However, there are no guarantees how long the COVID-19 virus may continue to impact our economy, and therefore, the Company.

While we expect the effects of COVID-19 could have an adverse future impact on our business, financial condition and results of operations, we are unable to predict the full extent or nature of these impacts at the current time.

11


FARMERS & MERCHANTS BANCORP
NOTES TO UNAUDITED CONSOLIDATED STATEMENTS (CONTINUED)

Note 3—Investment Securities

The amortized cost, fair values, and unrealized gains and losses of the securities available-for-sale are as follows:

Available-for-Sale Securities
 
     Gross Unrealized    
 
(Dollars in thousands)
 
Amortized
Cost
   
Gains
   
Losses
   
Fair
Value
 
As of March 31, 2022                                
U.S. Treasury notes
 
$
9,955
   
$
41
   
$
-
   
$
9,996
 
U.S. Government-sponsored securities
   
5,771
     
54
     
36
     
5,789
 
Mortgage-backed securities (1)
   
241,585
     
370
     
18,054
     
223,901
 
Collateralized mortgage obligations (1)
    1,549       -       5       1,544  
Corporate securities
   
10,051
     
-
     
216
     
9,835
 
Other
   
310
     
-
     
-
     
310
 
Total available-for-sale securities
 
$
269,221
   
$
465
   
$
18,311
   
$
251,375
 

(1) All mortgage-backed securities and collateralized mortgage obligations were issued by an agency or government sponsored entity of the U.S. Government.

Available-for-Sale Securities  

   
Gross Unrealized
   

 
(Dollars in thousands)
 
Amortized
Cost
   
Gains
   
Losses
   
Fair
Value
 
 
As of December 31, 2021
                               
U.S. Treasury notes
 
$
9,938
   
$
151
   
$
-
   
$
10,089
 
U.S. Government-sponsored securities
   
6,351
     
62
     
39
     
6,374
 
Mortgage-backed securities (1)
   
253,300
     
3,200
     
5,380
     
251,120
 
Collateralized mortgage obligations (1)
    2,412       24       -       2,436  
Other
   
435
     
-
     
-
     
435
 
Total available-for-sale securities
 
$
272,436
   
$
3,437
   
$
5,419
   
$
270,454
 

(1) All mortgage-backed securities and collateralized mortgage obligations were issued by an agency or government sponsored entity of the U.S. Government.

12


FARMERS & MERCHANTS BANCORP
NOTES TO UNAUDITED CONSOLIDATED STATEMENTS (CONTINUED)
Note 3—Investment Securities—Continued

The book values, estimated fair values and unrealized gains and losses of investments classified as held-to-maturity are as follows:

Held-to-Maturity Securities  

   
Gross Unrealized
   

 
(Dollars in thousands)
 
Amortized
Cost
   
Gains
   
Losses
   
Fair
Value
 
As of March 31, 2022                        
Municipal securities
 
$
63,581
   
$
162
   
$
65
   
$
63,678
 
Mortgage-backed securities (1)
   
695,249
     
-
     
60,650
     
634,599
 
Collateralized mortgage obligations (1)
    117,427       -       4,795       112,632  
Total held-to-maturity securities
 
$
876,257
   
$
162
   
$
65,510
   
$
810,909
 

(1) All mortgage-backed securities and collateralized mortgage obligations were issued by an agency or government sponsored entity of the U.S. Government.

Held-to-Maturity Securities
 

   
Gross Unrealized
   

 
(Dollars in thousands)
 
Amortized
Cost
   
Gains
   
Losses
   
Fair
Value
 
As of December 31, 2021                        
Municipal securities
 
$
66,496
   
$
701
   
$
-
   
$
67,197
 
Mortgage-backed securities (1)
    596,775