XML 43 R31.htm IDEA: XBRL DOCUMENT v3.23.1
Fair Value of Financial Instruments (Tables)
3 Months Ended
Mar. 31, 2023
Fair Value Disclosures [Abstract]  
Schedule of Company's Financial Instruments Measured at Fair Value on a Recurring Basis
The following fair value hierarchy table presents information about the Company’s financial assets and liabilities measured at fair value on a recurring basis at the dates indicated:
March 31, 2023
 Fair Value Measurement Using Total Fair Value
(Dollars in thousands)Level 1Level 2Level 3
Financial assets
AFS investment securities:    
U.S. Treasury$— $13,355 $— $13,355 
Agency— 417,731 — 417,731 
Corporate— 508,189 — 508,189 
Collateralized mortgage obligations— 372,632 — 372,632 
Mortgage-backed securities— 800,945 — 800,945 
Total AFS investment securities$— $2,112,852 $— $2,112,852 
Equity securities$962 $— $— $962 
Derivative assets:
Foreign exchange contracts$37 $— $— $37 
Interest rate swaps (1)
— 5,630 — 5,630 
Equity warrants— — 412 412 
Total derivative assets$37 $5,630 $412 $6,079 
Financial liabilities
Derivative liabilities:
Foreign exchange$$— $— $
Interest rate swaps— 10,569 — 10,569 
Total derivative liabilities$$10,569 $— $10,577 
______________________________
(1) Represents amounts after the application of variation margin payments as settlements with central counterparties, where applicable. See Note 11 – Derivative Instruments for additional information.
December 31, 2022
 Fair Value Measurement UsingTotal Fair Value
(Dollars in thousands)Level 1Level 2Level 3
Financial assets
AFS investment securities:    
U.S. Treasury$— $47,017 $— $47,017 
Agency— 431,438 — 431,438 
Corporate— 542,548 — 542,548 
Collateralized mortgage obligations— 764,229 — 764,229 
Mortgage-backed securities— 815,781 — 815,781 
Total AFS investment securities$— $2,601,013 $— $2,601,013 
Equity securities (1)
$925 $— $— $13,526 
Derivative assets:
Foreign exchange contracts$$— $— $
Interest rate swaps (2)
— 7,053 — 7,053 
Equity warrants— — 1,894 1,894 
Total derivative assets$$7,053 $1,894 $8,948 
Financial liabilities
Derivative liabilities:
Foreign exchange$$— $— $
Interest rate swaps— 12,530 — 12,530 
Total derivative liabilities$$12,530 $— $12,531 
(1) Includes equity securities that are measured at net asset value per share (or its equivalent) as a practical expedient of $12.6 million at December 31, 2022 and are excluded from the fair value hierarchy.
(2) Represents amounts after the application of variation margin payments as settlements with central counterparties, where applicable. See Note 11 – Derivative Instruments for additional information.
Schedule of Reconciliation of Fair Value of Equity Warrants
The following table is a reconciliation of the fair value of the equity warrants that are classified as Level 3 and measured on a recurring basis as of:
Three Months Ended
March 31,March 31,
(Dollars in thousands)20232022
Beginning balance$1,894 $1,889 
Change in fair value (1)
(20)19 
Net exercise(1,462)— 
Ending balance$412 $1,908 
______________________________
(1) The changes in fair value are included in other income on the consolidated statement of income.
Schedule of Quantitative Information for Level 3 Fair Value Measurements
The following table presents quantitative information about Level 3 fair value measurements for assets measured at fair value on a recurring basis at the dates indicated.
 March 31, 2023
   Range
(Dollars in thousands)Fair ValueValuation Technique(s)Unobservable Input(s)MinMaxWeighted Average
Equity warrants$412 Black-Scholes
option pricing
model
Volatility
Risk free interest rate
Marketability discount
35.00%
3.94%
5.50%
35.00%
3.94%
5.50%
35.00%
3.94%
5.50%
 December 31, 2022
   Range
(Dollars in thousands)Fair ValueValuation Technique(s)Unobservable Input(s)MinMaxWeighted Average
Equity warrants$1,894 Black-Scholes
option pricing
model
Volatility
Risk free interest rate
Marketability discount
30.00%
4.32%
6.00%
35.00%
4.41%
16.00%
31.14%
4.39%
13.60%
The following table presents quantitative information about Level 3 fair value measurements for assets measured at fair value on a nonrecurring basis at the dates indicated.
 March 31, 2023
   Range
(Dollars in thousands)Fair ValueValuation Technique(s)Unobservable Input(s)MinMaxWeighted Average
Investor loans secured by real estate
Multifamily$985 Fair value of collateralCost to sell7.00%7.00%7.00%
Total individually evaluated loans$985 
Other real estate owned5,499 Fair value of propertyCost to sell6.00%6.00%6.00%
Total assets$6,484 
 December 31, 2022
   Range
(Dollars in thousands)Fair ValueValuation Technique(s)Unobservable Input(s)MinMaxWeighted Average
Commercial loans
Commercial and industrial3,180 Fair value of collateralCollateral discount and cost to sell6.00%6.00%6.00%
Total individually evaluated loans$3,180 
______________________________
(1) SBA loans that are collateralized by hotel/motel real property.
Schedule of Company's Financial Instruments Measured at Fair Value on a Nonrecurring Basis
The following table presents our assets measured at fair value on a nonrecurring basis at the dates indicated.
 March 31, 2023
Fair Value Measurement UsingTotal
Fair Value
(Dollars in thousands)Level 1Level 2Level 3
Financial assets   
Collateral dependent loans$— $— $985 $985 
Other real estate owned— — 5,499 5,499 
Total assets$— $— $6,484 $6,484 
 December 31, 2022
Fair Value Measurement UsingTotal
Fair Value
(Dollars in thousands)Level 1Level 2Level 3
Financial assets    
Collateral dependent loans$— $— $3,180 $3,180 
Schedule of Carrying Amount and Estimated Fair Value of Financial Instruments
The fair value estimates presented herein are based on pertinent information available to management as of the dates indicated, representing an exit price.
 At March 31, 2023
(Dollars in thousands)Carrying
Amount
Level 1Level 2Level 3Estimated
Fair Value
Assets     
Cash and cash equivalents$1,424,896 $1,424,896 $— $— $1,424,896 
Interest-bearing time deposits with financial institutions1,734 1,734 — — 1,734 
HTM investment securities1,749,030 — 1,496,494 — 1,496,494 
AFS investment securities2,112,852 — 2,112,852 — 2,112,852 
Equity securities962 962 — — 962 
Loans held for sale1,247 — 1,296 — 1,296 
Loans held for investment, net14,171,784 — — 13,412,607 13,412,607 
Derivative assets (1)
6,079 37 5,630 412 6,079 
Accrued interest receivable69,660 — 69,660 — 69,660 
Liabilities     
Deposit accounts$17,207,810 $— $17,204,363 $— $17,204,363 
FHLB advances800,000 — 788,132 — 788,132 
Subordinated debentures331,364 — 325,170 — 325,170 
Derivative liabilities10,577 10,569 — 10,577 
Accrued interest payable23,261 — 23,261 — 23,261 
______________________________
(1) Represents amounts after the application of variation margin payments as settlements with central counterparties, where applicable. See Note 11 – Derivative Instruments for additional information.
 At December 31, 2022
(Dollars in thousands)Carrying
Amount
Level 1Level 2Level 3Estimated
Fair Value
Assets     
Cash and cash equivalents$1,101,249 $1,101,249 $— $— $1,101,249 
Interest-bearing time deposits with financial institutions1,734 1,734 — — 1,734 
HTM investment securities1,388,103 — 1,097,096 — 1,097,096 
AFS investment securities2,601,013 — 2,601,013 — 2,601,013 
Equity securities (1)
13,526 925 — — 13,526 
Loans held for sale2,643 — 2,755 — 2,755 
Loans held for investment, net14,676,298 — — 13,846,403 13,846,403 
Derivative assets (2)
8,948 7,053 1,894 8,948 
Accrued interest receivable73,784 — 73,784 — 73,784 
Liabilities     
Deposit accounts$17,352,401 $— $17,334,219 $— $17,334,219 
FHLB advances1,000,000 — 982,695 — 982,695 
Subordinated debentures331,204 — 327,609 — 327,609 
Derivative liabilities12,531 12,530 — 12,531 
Accrued interest payable14,661 — 14,661 — 14,661 
______________________________
(1) Includes equity securities that are measured at net asset value per share (or its equivalent) as a practical expedient of $12.6 million at December 31, 2022 and are excluded from the fair value hierarchy.
(2) Represents amounts after the application of variation margin payments as settlements with central counterparties, where applicable. See Note 11 – Derivative Instruments for additional information.