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Subordinated Debentures
 9 Months Ended
Sep. 30, 2023
Debt Disclosure [Abstract]  
Subordinated Debentures Subordinated Debentures
As of September 30, 2023, the Company had three subordinated notes with an aggregate carrying value of $331.7 million and a weighted interest rate of 5.31%, compared to $331.2 million with a weighted interest rate of 5.32% at December 31, 2022. The increase of $478,000 was primarily due to amortization of debt issuance costs.

The following table summarizes our outstanding subordinated debentures as of the dates indicated:
 Carrying Value
(Dollars in thousands)Stated MaturityCurrent Interest RateCurrent Principal BalanceSeptember 30, 2023December 31, 2022
Subordinated notes
Subordinated notes due 2024, 5.75% per annum
September 3, 20245.75 %$60,000 $59,880 $59,791 
Subordinated notes due 2029, 4.875% per annum until May 15, 2024, 3-month term SOFR +2.762% thereafter
May 15, 20294.875 %125,000 123,577 123,386 
Subordinated notes due 2030, 5.375% per annum until June 15, 2025, 3-month term SOFR +5.170% thereafter
June 15, 20305.375 %150,000 148,225 148,027 
Total subordinated debentures$335,000 $331,682 $331,204 

Upon the cessation of LIBOR on June 30, 2023, the LIBOR-based benchmark rate after May 15, 2024 for our subordinated notes due 2029 transitioned to 3-month term SOFR as successor base rate plus the relevant spread adjustment.

In connection with the various issuances of subordinated notes, the Corporation obtained ratings from Kroll Bond Rating Agency (“KBRA”). KBRA assigned investment grade ratings of BBB+ and BBB for the Corporation’s senior unsecured debt and subordinated debt, respectively, and a deposit and senior unsecured debt rating of A- and subordinated debt of BBB+ for the Bank. The Corporation’s and Bank’s ratings were reaffirmed in June 2023 by KBRA.

For additional information on the Company’s subordinated debentures, see “Note 13 — Subordinated Debentures” to the consolidated financial statements in the Company’s 2022 Form 10-K. 

For regulatory capital purposes, subordinated notes qualify as Tier 2 capital, subject to limitations. Per applicable Federal Reserve rules and regulations, the amount of the subordinated notes qualifying as Tier 2 regulatory capital is phased out by 20 % of the original amount of the subordinated notes in each of the five years beginning on the fifth anniversary preceding the maturity date of the subordinated notes. The regulatory total capital ratios of the Company and the Bank continued to exceed regulatory minimums, inclusive of the fully phased-in capital conservation buffer.