1ST SOURCE CORP [SRCE] Filings

10-Q 1 source-20240630.htm 10-Q 2ND QUARTER 2024 source-20240630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended June 30, 2024

☐ 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 0-6233

1st Source Corporation

(Exact name of registrant as specified in its charter)


Indiana						35-1068133
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)


100 North Michigan Street
South Bend,	IN	46601
(Address of principal executive offices)		(Zip Code)

(574) 235-2000

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

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

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock - without par value

SRCE

The NASDAQ Stock Market LLC

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. x Yes o 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). x Yes o 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 Section13(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 x No

Number of shares of common stock outstanding as of July 19, 2024 — 24,512,343 shares

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TABLE OF CONTENTS


		Page

PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements (Unaudited)
	Consolidated Statements of Financial Condition — June 30, 2024 and December 31, 2023	3
	Consolidated Statements of Income — three and six months ended June 30, 2024 and 2023	4
	Consolidated Statements of Comprehensive Income (Loss) — three and six months ended June 30, 2024 and 2023	5
	Consolidated Statements of Shareholders’ Equity — three and six months ended June 30, 2024 and 2023	6
	Consolidated Statements of Cash Flows — six months ended June 30, 2024 and 2023	7
	Notes to the Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	32
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	43
Item 4.	Controls and Procedures	43

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	43
Item 1A.	Risk Factors	43
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	44
Item 3.	Defaults Upon Senior Securities	44
Item 4.	Mine Safety Disclosures	44
Item 5.	Other Information	44
Item 6.	Exhibits	44

SIGNATURES		45

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1st SOURCE CORPORATION

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(Unaudited - Dollars in thousands)


	June 30, 2024		December 31, 2023
ASSETS
Cash and due from banks	$	89,592	$	77,474
Federal funds sold and interest bearing deposits with other banks	179,651		52,194
Investment securities available-for-sale, at fair value	1,523,548		1,622,600
Other investments	24,585		25,075

Mortgages held for sale	2,763		1,442
Loans and leases, net of unearned discount:
Commercial and agricultural	721,235		766,223
Renewable energy	459,441		399,708
Auto and light truck	1,009,967		966,912
Medium and heavy duty truck	315,157		311,947
Aircraft	1,058,591		1,078,172
Construction equipment	1,132,556		1,084,752
Commercial real estate	1,164,598		1,129,861
Residential real estate and home equity	654,357		637,973
Consumer	137,097		142,957
Total loans and leases	6,652,999		6,518,505
Allowance for loan and lease losses	(150,067)		(147,552)
Net loans and leases	6,502,932		6,370,953
Equipment owned under operating leases, net	13,886		20,366
Premises and equipment, net	48,201		46,159
Goodwill and intangible assets	83,907		83,916
Accrued income and other assets	408,938		427,779
Total assets	$	8,878,003	$	8,727,958
LIABILITIES
Deposits:
Noninterest-bearing demand	$	1,578,762	$	1,655,728
Interest-bearing deposits:
Interest-bearing demand	2,543,724		2,430,833
Savings	1,255,154		1,213,334
Time	1,818,284		1,738,686
Total interest-bearing deposits	5,617,162		5,382,853
Total deposits	7,195,924		7,038,581
Short-term borrowings:
Federal funds purchased and securities sold under agreements to repurchase	70,767		55,809
Other short-term borrowings	217,450		256,550
Total short-term borrowings	288,217		312,359
Long-term debt and mandatorily redeemable securities	39,136		47,911
Subordinated notes	58,764		58,764
Accrued expenses and other liabilities	181,107		202,080
Total liabilities	7,763,148		7,659,695
SHAREHOLDERS’ EQUITY
Preferred stock; no par value
Authorized 10,000,000 shares; none issued or outstanding	—		—
Common stock; no par value
Authorized 40,000,000 shares; issued 28,205,674 at June 30, 2024 and December 31, 2023	436,538		436,538
Retained earnings	841,790		789,842
Cost of common stock in treasury (3,698,651 shares at June 30, 2024 and 3,771,070 shares at December 31, 2023)	(129,248)		(130,489)
Accumulated other comprehensive loss	(105,565)		(106,323)
Total shareholders’ equity	1,043,515		989,568
Noncontrolling interests	71,340		78,695
Total equity	1,114,855		1,068,263
Total liabilities and equity	$	8,878,003	$	8,727,958

The accompanying notes are a part of the unaudited consolidated financial statements.

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1st SOURCE CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited - Dollars in thousands, except per share amounts)


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Interest income:
Loans and leases	$	113,101	$	93,300	$	222,303	$	179,989
Investment securities, taxable	5,900		5,946		11,979		12,594
Investment securities, tax-exempt	254		330		514		812
Other	1,914		978		2,841		1,615
Total interest income	121,169		100,554		237,637		195,010
Interest expense:
Deposits	43,095		28,870		82,839		50,133
Short-term borrowings	2,158		1,625		5,260		3,018
Subordinated notes	1,061		1,028		2,122		2,048
Long-term debt and mandatorily redeemable securities	805		515		1,451		1,730
Total interest expense	47,119		32,038		91,672		56,929
Net interest income	74,050		68,516		145,965		138,081
Provision for credit losses	56		47		6,651		3,096
Net interest income after provision for credit losses	73,994		68,469		139,314		134,985
Noninterest income:
Trust and wealth advisory	7,081		6,467		13,368		12,146
Service charges on deposit accounts	3,203		3,118		6,273		6,121
Debit card	4,562		4,701		8,763		9,208
Mortgage banking	1,280		926		2,230		1,728
Insurance commissions	1,611		1,641		3,387		3,670
Equipment rental	1,257		2,326		2,928		4,829
Losses on investment securities available-for-sale	—		—		—		(44)
Other	4,227		3,590		8,428		8,434
Total noninterest income	23,221		22,769		45,377		46,092
Noninterest expense:
Salaries and employee benefits	29,238		28,236		58,810		56,833
Net occupancy	2,908		2,676		5,904		5,298
Furniture and equipment	1,265		1,414		2,414		2,721
Data processing	6,712		6,268		13,212		12,425
Depreciation – leased equipment	999		1,876		2,287		3,898
Professional fees	1,713		1,704		3,058		2,386
FDIC and other insurance	1,627		1,344		3,284		2,704
Business development and marketing	2,026		1,649		3,770		3,621

Other	3,003		3,998		6,338		8,700
Total noninterest expense	49,491		49,165		99,077		98,586
Income before income taxes	47,724		42,073		85,614		82,491
Income tax expense	10,919		9,626		19,347		18,913
Net income	36,805		32,447		66,267		63,578
Net (income) loss attributable to noncontrolling interests	(12)		(12)		(19)		(19)
Net income available to common shareholders	$	36,793	$	32,435	$	66,248	$	63,559
Per common share:
Basic net income per common share	$	1.49	$	1.30	$	2.68	$	2.55
Diluted net income per common share	$	1.49	$	1.30	$	2.68	$	2.55

Basic weighted average common shares outstanding	24,495,495		24,686,435		24,477,292		24,686,760
Diluted weighted average common shares outstanding	24,495,495		24,686,435		24,477,292		24,686,760

The accompanying notes are a part of the unaudited consolidated financial statements.

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1st SOURCE CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited - Dollars in thousands)


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Net income	$	36,805	$	32,447	$	66,267	$	63,578
Other comprehensive income (loss):
Unrealized appreciation (depreciation) of available-for-sale securities	4,912		(15,813)		1,121		10,663
Reclassification adjustment for realized losses included in net income	—		—		—		44
Income tax effect	(1,202)		3,728		(363)		(2,567)
Other comprehensive income (loss), net of tax	3,710		(12,085)		758		8,140
Comprehensive income (loss)	40,515		20,362		67,025		71,718
Comprehensive (income) loss attributable to noncontrolling interests	(12)		(12)		(19)		(19)
Comprehensive income (loss) available to common shareholders	$	40,503	$	20,350	$	67,006	$	71,699

The accompanying notes are a part of the unaudited consolidated financial statements.

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1st SOURCE CORPORATION

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(Unaudited - Dollars in thousands, except per share amounts)



	Three Months Ended
	Preferred Stock		Common Stock		Retained Earnings		Cost of Common Stock in Treasury		Accumulated Other Comprehensive Income (Loss), Net		Total Shareholders’ Equity		Noncontrolling Interests		Total Equity
Balance at April 1, 2023	$	—	$	436,538	$	719,495	$	(119,409)	$	(127,465)	$	909,159	$	59,285	$	968,444
Net income	—		—		32,435		—		—		32,435		12		32,447
Other comprehensive loss	—		—		—		—		(12,085)		(12,085)		—		(12,085)
Issuance of 20,285 common shares under stock based compensation awards	—		—		448		410		—		858		—		858
Cost of 33,276 shares of common stock acquired for treasury	—		—		—		(1,411)		—		(1,411)		—		(1,411)
Common stock dividend ($0.32 per share)	—		—		(7,936)		—		—		(7,936)		—		(7,936)

Distributions to noncontrolling interests	—		—		—		—		—		—		(230)		(230)
Balance at June 30, 2023	$	—	$	436,538	$	744,442	$	(120,410)	$	(139,550)	$	921,020	$	59,067	$	980,087

Balance at April 1, 2024	$	—	$	436,538	$	812,413	$	(129,790)	$	(109,275)	$	1,009,886	$	71,663	$	1,081,549
Net income	—		—		36,793		—		—		36,793		12		36,805
Other comprehensive income	—		—		—		—		3,710		3,710		—		3,710
Issuance of 29,365 common shares under stock based compensation awards	—		—		924		542		—		1,466		—		1,466

Common stock dividend ($0.34 per share)	—		—		(8,340)		—		—		(8,340)		—		(8,340)


Distributions to noncontrolling interests	—		—		—		—		—		—		(335)		(335)
Balance at June 30, 2024	$	—	$	436,538	$	841,790	$	(129,248)	$	(105,565)	$	1,043,515	$	71,340	$	1,114,855


	Six Months Ended
	Preferred Stock		Common Stock		Retained Earnings		Cost of Common Stock in Treasury		Accumulated Other Comprehensive Income (Loss), Net		Total Shareholders’ Equity		Noncontrolling Interests		Total Equity
Balance at January 1, 2023	$	—	$	436,538	$	694,862	$	(119,642)	$	(147,690)	$	864,068	$	59,698	$	923,766


Net income	—		—		63,559		—		—		63,559		19		63,578
Other comprehensive income	—		—		—		—		8,140		8,140		—		8,140
Issuance of 69,910 common shares under stock based compensation awards	—		—		1,874		1,409		—		3,283		—		3,283
Cost of 49,635 shares of common stock acquired for treasury	—		—		—		(2,177)		—		(2,177)		—		(2,177)
Common stock dividend ($0.64 per share)	—		—		(15,853)		—		—		(15,853)		—		(15,853)

Distributions to noncontrolling interests	—		—		—		—		—		—		(650)		(650)
Balance at June 30, 2023	$	—	$	436,538	$	744,442	$	(120,410)	$	(139,550)	$	921,020	$	59,067	980,087

Balance at January 1, 2024	$	—	$	436,538	$	789,842	$	(130,489)	$	(106,323)	$	989,568	$	78,695	$	1,068,263


Net income	—		—		66,248		—		—		66,248		19		66,267
Other comprehensive income	—		—		—		—		758		758		—		758
Issuance of 72,419 common shares under stock based compensation awards	—		—		2,386		1,241		—		3,627		—		3,627

Common stock dividend ($0.68 per share)	—		—		(16,686)		—		—		(16,686)		—		(16,686)

Distributions to noncontrolling interests	—		—		—		—		—		—		(1,454)		(1,454)
Liquidation of noncontrolling interests	—		—		—		—		—		—		(5,920)		(5,920)
Balance at June 30, 2024	$	—	$	436,538	$	841,790	$	(129,248)	$	(105,565)	$	1,043,515	$	71,340	$	1,114,855

The accompanying notes are a part of the unaudited consolidated financial statements.

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1st SOURCE CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited - Dollars in thousands)


	Six Months Ended June 30,
	2024		2023
Operating activities:
Net income	$	66,267	$	63,578
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for credit losses	6,651		3,096
Depreciation of premises and equipment	2,100		2,307
Depreciation of equipment owned and leased to others	2,287		3,898
Stock-based compensation	2,525		2,240
Amortization of investment securities premiums and accretion of discounts, net	1,529		2,062
Amortization of mortgage servicing rights	369		435

Amortization of right of use assets	1,524		1,554
Deferred income taxes	201		(4,100)
Losses on investment securities available-for-sale	—		44
Originations of loans held for sale, net of principal collected	(29,233)		(19,345)
Proceeds from the sales of loans held for sale	28,989		21,571
Net gain on sale of loans held for sale	(1,077)		(633)
Net gain on sale of other real estate and repossessions	(108)		(103)


Change in interest receivable	(1,683)		(397)
Change in interest payable	6,457		14,216
Change in other assets	813		(1,078)
Change in other liabilities	4,816		2,899
Other	(481)		(617)
Net change in operating activities	91,946		91,627

Investing activities:
Proceeds from sales of investment securities available-for-sale	—		64,928
Proceeds from maturities and paydowns of investment securities available-for-sale	129,303		60,396
Purchases of investment securities available-for-sale	(30,659)		(3,000)
Net change in partnership investments	(16,117)		(18,770)
Net change in other investments	490		(27)
Loans sold or participated to others	71,900		36,385
Proceeds from principal payments on direct finance leases	34,071		28,659

Net change in loans and leases	(245,744)		(269,172)
Net change in equipment owned under operating leases	4,193		1,220
Purchases of premises and equipment	(4,155)		(1,625)
Proceeds from disposal of premises and equipment	13		3

Proceeds from sales of other real estate and repossessions	1,164		963
Net change in investing activities	(55,541)		(100,040)

Financing activities:
Net change in demand deposits and savings accounts	77,745		(374,462)
Net change in time deposits	79,598		422,715
Net change in short-term borrowings	(24,142)		(27,844)

Payments on long-term debt and mandatorily redeemable securities	(11,540)		(3,055)
Stock issued under stock purchase plans	153		77
Acquisition of treasury stock	—		(2,177)
Net (distributions to) contributions from noncontrolling interests	(1,454)		(650)
Cash dividends paid on common stock	(17,190)		(16,313)
Net change in financing activities	103,170		(1,709)


Net change in cash and cash equivalents	139,575		(10,122)
Cash and cash equivalents, beginning of year	129,668		122,797
Cash and cash equivalents, end of period	$	269,243	$	112,675
Supplemental Information:
Non-cash transactions:
Loans transferred to other real estate and repossessed assets	$	723	$	668
Common stock matching contribution to Employee Stock Ownership and Profit Sharing Plan	1,153		1,753
Right of use assets obtained in exchange for lease obligations	888		2,710
Liquidation of noncontrolling interests	5,920		—
Purchases of mandatorily redeemable securities with common stock	586		—

The accompanying notes are a part of the unaudited consolidated financial statements.

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1ST SOURCE CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1 — Accounting Policies

1st Source Corporation is a bank holding company headquartered in South Bend, Indiana that provides, through its subsidiaries (collectively referred to as “1st Source” or “the Company”), a broad array of financial products and services.

Basis of Presentation – The accompanying unaudited consolidated financial statements reflect all adjustments (all of which are normal and recurring in nature) which are, in the opinion of management, necessary for a fair presentation of the consolidated financial position, the results of operations, changes in comprehensive income (loss), changes in shareholders’ equity, and cash flows for the periods presented. These unaudited consolidated financial statements have been prepared according to the rules and regulations of the Securities and Exchange Commission (SEC) and, therefore, certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (GAAP) have been omitted.

The Notes to the Consolidated Financial Statements appearing in 1st Source Corporation’s Annual Report on Form 10-K (2023 Annual Report), which include descriptions of significant accounting policies, should be read in conjunction with these interim financial statements. The Consolidated Statement of Financial Condition at December 31, 2023, has been derived from the audited financial statements at that date, but does not include all of the information and footnotes required by GAAP for complete financial statements. Certain amounts in the prior period consolidated financial statements have been reclassified to conform to the current period presentation.

Use of Estimates in the Preparation of Financial Statements – Financial statements prepared in accordance with GAAP require the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expense during the reporting period. Actual results could differ from those estimates.

Loans and Leases – Loans are stated at the principal amount outstanding, net of unamortized deferred loan origination fees and costs and net of unearned income. Interest income is accrued as earned based on unpaid principal balances. Origination fees and direct loan and lease origination costs are deferred, and the net amount amortized to interest income over the estimated life of the related loan or lease. Loan commitment fees are deferred and amortized into other income over the commitment period.

Direct financing leases are carried at the aggregate of lease payments plus estimated residual value of the leased property, net of unamortized deferred lease origination fees and costs and unearned income. Only those costs incurred as a direct result of closing a lease transaction are capitalized and all other initial direct costs are expensed immediately. Interest income on direct financing leases is recognized over the term of the lease to achieve a constant periodic rate of return on the outstanding investment.

Accrued interest is included in Accrued Income and Other Assets on the Consolidated Statements of Financial Condition and is excluded from the calculation of the allowance for credit losses. The accrual of interest on loans and leases is discontinued when a loan or lease becomes contractually delinquent for 90 days, or when an individual analysis of a borrower’s credit worthiness indicates a credit should be placed on nonperforming status, except for residential mortgage loans and consumer loans that are well secured and in the process of collection. Residential mortgage loans are placed on nonaccrual at the time the loan is placed in foreclosure. When interest accruals are discontinued, interest credited to income in the current year is reversed and interest accrued in the prior year is charged to the allowance for loan and lease losses. However, in some cases, the Company may elect to continue the accrual of interest when the net realizable value of collateral is sufficient to cover the principal and accrued interest. When a loan or lease is classified as nonaccrual and the future collectability of the recorded loan or lease balance is doubtful, collections on interest and principal are applied as a reduction to principal outstanding. Loans are returned to accrual status when all principal and interest amounts contractually due are brought current and future payments are reasonably assured, which is typically evidenced by a sustained repayment performance of at least six months.

Occasionally, the Company modifies loans and leases to borrowers in financial distress (typically denoted by internal credit quality graded “substandard” or worse) by providing term extensions, other-than-insignificant payment delays, or interest rate reductions. In some cases, a combination of modifications are made to the same loan or lease. These modifications typically result from the Company’s loss mitigation activities. If the Company determines that the value of the modified loan is less than the recorded investment in the loan (net of previous charge-offs, deferred loan fees or costs and unamortized premium or discount), impairment is recognized through an allowance for loan and lease losses estimate or a charge-off to the allowance for loan and lease losses.

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Note 2 — Recent Accounting Pronouncements

Income Taxes: In December 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2023-09 “Income Taxes (Topic 740): Improvements to Income Tax Disclosures.” Among other things, these amendments require that public business entities on an annual basis (1) disclose specific categories in the rate reconciliation and (2) provide additional information for reconciling items that meet a quantitative threshold (if the effect of those reconciling items is equal to or greater than five percent of the amount computed by multiplying pretax income (loss) by the applicable statutory income tax rate.) The amendments also require that all entities disclose on an annual basis the following information about income taxes paid: (1) the amount of income taxes paid (net of refunds received) disaggregated by federal, state, and foreign taxes and (2) the amount of income taxes paid (net of refunds received) disaggregated by individual jurisdictions in which income taxes paid (net of refunds received) is equal to or greater than five percent of total income taxes paid (net of refunds received.) This guidance is effective for public business entities for annual periods beginning after December 15, 2024. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. The amendments should be applied on a prospective basis although retrospective application is permitted. The Company continues to assess ASU 2023-09 and its impact on its accounting and disclosures.

Segment Reporting: In November 2023, the FASB issued ASU 2023-07 “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures.” These amendments require, among other things, that a public entity that has a single reportable segment provide all the disclosures required by the amendments in this ASU and all existing segment disclosures in Topic 208. The ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. A public entity should apply the amendments retrospectively to all periods presented in the financial statements. The Company continues to assess ASU 2023-07 and its impact on its accounting and disclosures.

Note 3 — Investment Securities Available-For-Sale

The following table shows investment securities available-for-sale.


(Dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
June 30, 2024
U.S. Treasury and Federal agencies securities	$	917,679	$	18	$	(49,018)	$	868,679
U.S. States and political subdivisions securities	88,825		50		(5,498)		83,377
Mortgage-backed securities — Federal agencies	651,080		37		(84,210)		566,907
Corporate debt securities	4,000		—		(11)		3,989
Foreign government and other securities	600		—		(4)		596
Total debt securities available-for-sale	$	1,662,184	$	105	$	(138,741)	$	1,523,548

December 31, 2023
U.S. Treasury and Federal agencies securities	$	979,530	$	178	$	(56,842)	$	922,866
U.S. States and political subdivisions securities	97,522		508		(5,466)		92,564
Mortgage-backed securities — Federal agencies	676,257		476		(78,481)		598,252
Corporate debt securities	8,448		—		(119)		8,329
Foreign government and other securities	600		—		(11)		589
Total debt securities available-for-sale	$	1,762,357	$	1,162	$	(140,919)	$	1,622,600

Amortized cost excludes accrued interest receivable which is included in Accrued Income and Other Assets on the Consolidated Statements of Financial Condition. At June 30, 2024 and December 31, 2023, accrued interest receivable on investment securities available-for-sale was $4.29 million and $4.60 million, respectively.

At June 30, 2024 and December 31, 2023, the residential mortgage-backed securities held by the Company consisted primarily of GNMA, FNMA and FHLMC pass-through certificates which are guaranteed by those respective agencies of the United States government (Government Sponsored Enterprise, GSEs).

The following table shows the contractual maturities of investments in debt securities available-for-sale at June 30, 2024. Expected maturities will differ from contractual maturities, because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

Table of Contents


(Dollars in thousands)	Amortized Cost		Fair Value
Due in one year or less	$	298,255	$	292,355
Due after one year through five years	680,250		632,431
Due after five years through ten years	15,903		15,495
Due after ten years	16,696		16,360
Mortgage-backed securities	651,080		566,907
Total debt securities available-for-sale	$	1,662,184	$	1,523,548

The following table summarizes gross unrealized losses and fair value by investment category and age. At June 30, 2024, the Company’s available-for-sale securities portfolio consisted of 647 securities, 620 of which were in an unrealized loss position.


	Less than 12 Months				12 months or Longer				Total
(Dollars in thousands)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
June 30, 2024
U.S. Treasury and Federal agencies securities	$	19,048	$	(156)	$	844,708	$	(48,862)	$	863,756	$	(49,018)
U.S. States and political subdivisions securities	14,393		(276)		61,402		(5,222)		75,795		(5,498)
Mortgage-backed securities - Federal agencies	40,663		(167)		516,907		(84,043)		557,570		(84,210)
Corporate debt securities	—		—		3,989		(11)		3,989		(11)
Foreign government and other securities	—		—		596		(4)		596		(4)
Total debt securities available-for-sale	$	74,104	$	(599)	$	1,427,602	$	(138,142)	$	1,501,706	$	(138,741)

December 31, 2023
U.S. Treasury and Federal agencies securities	$	—	$	—	$	913,417	$	(56,842)	$	913,417	$	(56,842)
U.S. States and political subdivisions securities	1,251		(2)		69,747		(5,464)		70,998		(5,466)
Mortgage-backed securities - Federal agencies	8,553		(98)		550,748		(78,383)		559,301		(78,481)
Corporate debt securities	—		—		8,329		(119)		8,329		(119)