BORROWINGS

9 Months Ended

Sep. 30, 2024

Debt Disclosure [Abstract]

BORROWINGS

BORROWINGS

Short-term debt

There was no short-term debt outstanding at September 30, 2024 and December 31, 2023.

The following is a summary of additional information relating to Customers’ short-term debt:

(dollars in thousands)	September 30, 2024 (1)			December 31, 2023 (2)
FRB advances
Maximum outstanding at any month end	$	—		$	—
Average balance during the period	—			120,099
Weighted-average interest rate during the period	—		%	5.23		%
FHLB advances
Maximum outstanding at any month end	150,000			—
Average balance during the period	11,496			87,407
Weighted-average interest rate during the period	5.74		%	5.16		%
Federal funds purchased
Maximum outstanding at any month end	—			—
Average balance during the period	—			3,781
Weighted-average interest rate during the period	—		%	4.97		%

(1)    For the nine months ended September 30, 2024.

(2)    For the year ended December 31, 2023.

At September 30, 2024 and December 31, 2023, Customers Bank had aggregate availability under federal funds lines totaling $1.7 billion.

Long-term debt

FHLB and FRB advances

Long-term FHLB and FRB advances at September 30, 2024 and December 31, 2023 were as follows:

	September 30, 2024						December 31, 2023
(dollars in thousands)	Amount			Rate			Amount		Rate
FHLB advances (1)	$	1,117,229	(2)	4.24	%	(3)	$	1,203,207	3.91	%
Total long-term FHLB and FRB advances	$	1,117,229					$	1,203,207

(1)    Amounts reported in the above table include fixed rate long-term advances from FHLB of $950.0 million with maturities ranging from March 2025 to March 2028, and variable rate long-term advances from FHLB of $155.0 million with maturities ranging from March 2028 to June 2029 with a returnable option that can be repaid without penalty on certain predetermined dates at Customers Bank's option, at September 30, 2024.

(2)    Includes $12.2 million and $3.2 million of unamortized basis adjustments from interest rate swaps designated as fair value hedges of long-term advances from FHLB at September 30, 2024 and December 31, 2023, respectively. Refer to NOTE 14 — DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES for additional information.

(3)    Excludes the effect of interest rate swaps designated as fair value hedges of long-term advances from FHLB.

Maturities of long-term FHLB advances were as follows at September 30, 2024:

	September 30, 2024
(dollars in thousands)	Amount (1)		Rate
2024	$	—	—	%
2025	200,000		4.45	%
2026	200,000		4.32	%
2027	450,000		3.70	%
2028	180,000		4.75	%
Thereafter	75,000		5.55	%
Total long-term FHLB advances	$	1,105,000

(1)    Amounts reported in the above table include variable rate long-term advances from FHLB of $155.0 million with maturities ranging from March 2028 to June 2029 with a returnable option that can be repaid without penalty on certain predetermined dates at Customers Bank's option.

The maximum borrowing capacity with the FHLB and FRB at September 30, 2024 and December 31, 2023 was as follows:

(amounts in thousands)	September 30, 2024		December 31, 2023
Total maximum borrowing capacity with the FHLB	$	3,565,068	$	3,474,347
Total maximum borrowing capacity with the FRB	4,180,824		3,436,000
Qualifying loans and securities serving as collateral against FHLB and FRB advances	9,508,135		8,575,137

Senior and Subordinated Debt

Long-term senior notes and subordinated debt at September 30, 2024 and December 31, 2023 were as follows:

(dollars in thousands)		Carrying Amount
Issued by	Ranking	September 30, 2024		December 31, 2023		Rate		Issued Amount		Date Issued	Maturity	Price
Customers Bancorp	Senior (1)	$	99,033	$	98,928	2.875	%	$	100,000	August 2021	August 2031	100.000	%
Customers Bancorp	Senior	—		24,912		4.500	%	25,000		September 2019	September 2024	100.000	%
Total other borrowings		$	99,033	$	123,840
Customers Bancorp	Subordinated (2)(3)	$	72,902	$	72,766	5.375	%	$	74,750	December 2019	December 2034	100.000	%
Customers Bank	Subordinated (2)(4)	109,537		109,464		6.125	%	110,000		June 2014	June 2029	100.000	%
Total subordinated debt		$	182,439	$	182,230

(1)The senior notes will bear an annual fixed rate of 2.875% until August 15, 2026. From August 15, 2026 until maturity, the notes will bear an annual interest rate equal to a benchmark rate, which is expected to be the three-month term SOFR, plus 235 basis points. Customers Bancorp has the ability to call the senior notes, in whole, or in part, at a redemption price equal to 100% of the principal balance at certain times on or after August 15, 2026.

(2)The subordinated notes qualify as Tier 2 capital for regulatory capital purposes.

(3)Customers Bancorp has the ability to call the subordinated notes, in whole, or in part, at a redemption price equal to 100% of the principal balance at certain times on or after December 30, 2029.

(4)The subordinated notes had an annual fixed rate of 6.125% until June 26, 2024. From June 26, 2024 until maturity, the notes bear an annual interest rate equal to the three-month LIBOR plus 344.3 basis points. Pursuant to the Adjustable Interest Rate (LIBOR) Act enacted by Congress on March 15, 2022, Customers substituted three-month term SOFR plus a tenor spread adjustment of 26.161 basis points for three-month LIBOR as the benchmark reference rate in order to calculate the annual interest rate after June 26, 2024. Customers Bank has the ability to call the subordinated notes, in whole, or in part, at a redemption price equal to 100% of the principal balance at certain times on or after June 26, 2024.