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Derivative Financial Instruments
 12 Months Ended
Dec. 31, 2025
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Financial Instruments Derivative Financial Instruments
Derivative Positions and Offsetting
Derivatives Designated in Hedge Relationships. Interest rate swaps allow the Company to change the fixed or variable nature of an interest rate without the exchange of the underlying notional amount. Certain pay fixed/receive variable interest rate swaps are designated as cash flow hedges to effectively convert variable-rate debt into fixed-rate debt, whereas certain receive fixed/pay variable interest rate swaps are designated as fair value hedges to effectively convert fixed-rate debt into variable-rate debt. Certain purchased options are also designated as cash flow hedges, allowing the Company to limit the potential adverse impact of variable interest rates by establishing a cap rate or floor rate in exchange for an upfront premium. The purchased options designated as cash flow hedges represent interest rate caps where payment is received from the counterparty if interest rates rise above the cap rate, and interest rate floors where payment is received from the counterparty when interest rates fall below the floor rate. The maximum length of time over which forecasted transactions are hedged is 2.1 years.
Derivatives Not Designated in Hedge Relationships. The Company also enters into derivative transactions that are not designated in hedge relationships. The Company has a back-to-back swap program, whereby it enters into an interest rate swap with a qualified customer and simultaneously enters into an equal and opposite interest-rate swap with a swap counterparty, to hedge interest rate risk. Derivative assets and derivative liabilities with the same counterparty are presented on a net basis when master netting agreements are in place.
The following tables present the notional amounts and fair values, including accrued interest, of derivative positions:
December 31, 2025
Asset DerivativesLiability Derivatives
(In thousands)Notional AmountsFair ValueNotional AmountsFair Value
Designated in hedge relationships:
Interest rate derivatives (1)
$4,500,000 $6,258 $500,000 $403 
Not designated in hedge relationships:
Interest rate derivatives (1)
9,989,160 223,685 9,989,160 222,794 
Mortgage banking derivatives4,032 67 — — 
Other (2)
412,075 191 1,014,621 517 
Total not designated as hedging instruments10,405,267 223,943 11,003,781 223,311 
Gross derivative instruments, before netting$14,905,267 230,201 $11,503,781 223,714 
Less: Master netting agreements65,063 65,063 
 Cash collateral pledged84,056 12,053 
Total derivative instruments, after netting$81,082 $146,598 
December 31, 2024
Asset DerivativesLiability Derivatives
(In thousands)Notional AmountsFair ValueNotional AmountsFair Value
Designated as hedging instruments:
Interest rate derivatives (1)
$750,000 $719 $4,250,000 $13,169 
Not designated in hedge relationships:
Interest rate derivatives (1)
8,693,493 300,120 8,728,767 298,296 
Mortgage banking derivatives 584 3 — — 
Other (2)
337,370 1,300 833,449 96 
Total not designated as hedging instruments9,031,447 301,423 9,562,216 298,392 
Gross derivative instruments, before netting$9,781,447 302,142 $13,812,216 311,561 
Less: Master netting agreements31,881 31,881 
 Cash collateral pledged251,212 80 
Total derivative instruments, after netting$19,049 $279,600 
(1)The notional amounts of interest rate swaps that were centrally-cleared through clearing housings was $65.3 million at December 31, 2025, and $71.1 million at December 31, 2024, for asset derivatives, and $126.5 million at December 31, 2025, and zero at December 31, 2024, for liability derivatives. Interest rate swaps that are centrally-cleared through clearing houses are “settled-to-market” and considered a single unit of account. In accordance with their rule books, clearing houses record the variation margin transferred for settled-to-market derivatives as a legal settlement of the derivative contract (i.e., the variation margin legally settles the outstanding exposure, but does not result in any other change or reset of the contractual terms of the derivative). The fair values of the Company’s settled-to-market interest rate swaps are presented net on the accompanying Consolidated Balance Sheets and approximated zero.
(2)Other derivatives not designated in hedge relationships included foreign currency forward contracts related to lending arrangements, a Visa equity swap transaction, and risk participation agreements. The notional amount of risk participation agreements was $370.1 million at December 31, 2025, and $294.5 million at December 31, 2024, for asset derivatives, and $965.4 million at December 31, 2025, and $796.6 million at December 31, 2024, for liability derivatives, all of which had immaterial related fair values.
The following tables represent the offsetting of derivative financial instruments that are subject to master netting agreements:
December 31, 2025
Gross Amounts of Recognized Assets/LiabilitiesGross Amounts Offset in the Statement of Financial PositionNet Amounts of Assets/Liabilities Presented in the Statement of Financial PositionGross Amounts Not Offset in the Statement of Financial position
(In thousands)Financial InstrumentsCash Collateral PledgedNet Amount
Asset derivatives$153,854 $65,063 $88,791 $— $84,056 $4,735 
Liability derivatives77,167 65,063 12,104 — 12,053 51 
December 31, 2024
Gross Amounts of Recognized Assets/LiabilitiesGross Amounts Offset in the Statement of Financial PositionNet Amounts of Assets/Liabilities Presented in the Statement of Financial PositionGross Amounts Not Offset in the Statement of Financial position
(In thousands)Financial InstrumentsCash Collateral PledgedNet Amount
Asset derivatives$283,185 $31,881 $251,304 $— $251,212 $92 
Liability derivatives32,218 31,881 337 — 80 257 
Derivative Activity
The following table summarizes the income statement effect of derivatives designated in hedge relationships:
Recognized InYears ended December 31,
(In thousands)Net Interest Income202520242023
Fair value hedges:
Interest rate derivativesDeposits interest expense$— $(1,320)$3,194 
Hedged itemDeposits interest expense— — (15)
Net recognized on fair value hedges (1)
$— $1,320 $(3,179)
Cash flow hedges:
Interest rate derivativesLong-term debt interest expense$— $34 $310 
Interest rate derivativesInterest and fees on loans and leases(10,207)(42,005)(14,628)
Net recognized on cash flow hedges (2)
$(10,207)$(42,039)$(14,938)
(1)The Company de-designated its fair value hedging relationship on $400.0 million of deposits, which pertained to a portion of Ametros’ member deposits, in 2023. The $1.3 million basis adjustment included in the carrying amount of deposits at December 31, 2023, was amortized into interest expense in January 2024 upon the acquisition of Ametros.
(2)Additional information regarding the amounts recognized in net income related to cash flow hedge activities can be found within Note 12: Accumulated Other Comprehensive (Loss), Net of Tax.
The following table summarizes the income statement effect of derivatives not designated in hedge relationships:
Recognized InYears ended December 31,
(In thousands)Non-interest Income202520242023
Interest rate derivativesOther income$8,664 $(1,480)$(6,159)
Mortgage banking derivativesOther income63 (34)5 
OtherOther income(5,526)4,246 (2,476)
Total not designated in hedge relationships$3,201 $2,732 $(8,630)
Derivative Exposure. At December 31, 2025, the Company had $84.5 million of cash collateral received and $13.8 million of cash collateral posted included in Cash and due from banks on the accompanying Consolidated Balance Sheets. In addition, the Company had $3.5 million in initial margin posted at clearing houses. The Company regularly evaluates the credit risk of its derivative customers, taking into account the likelihood of default, net exposures, and remaining contractual life, among other related factors. Credit risk exposure is mitigated as transactions with customers are generally secured by the same collateral of the underlying transactions. Current net credit exposure relating to derivatives with the Bank’s customers was $76.3 million at December 31, 2025. In addition, the Company monitors potential future exposure, representing its best estimate of exposure to remaining contractual maturity. The potential future exposure relating to derivatives with the Bank’s customers totaled $126.9 million at December 31, 2025. The Company has incorporated a credit valuation adjustment to reflect non-performance risk in the fair value measurement of its derivatives, which totaled $4.2 million at December 31, 2025, and $7.6 million at December 31, 2024. Various factors impact changes in the credit valuation adjustment over time, such as changes in the credit spreads of the contracted parties, and changes in market rates and volatilities, which affect the total expected exposure of the derivative instruments.