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Junior Subordinated Debentures | 3 Months Ended
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Mar. 31, 2022
Junior Subordinated Debenture Owed to Unconsolidated Subsidiary Trust [Abstract] |
Junior Subordinated Debentures | Junior Subordinated Debentures As of March 31, 2022, the Company owned 100% of the common securities of eleven trusts, Wintrust Capital Trust III, Wintrust Statutory Trust IV, Wintrust Statutory Trust V, Wintrust Capital Trust VII, Wintrust Capital Trust VIII, Wintrust Capital Trust IX, Northview Capital Trust I, Town Bankshares Capital Trust I, First Northwest Capital Trust I, Suburban Illinois Capital Trust II, and Community Financial Shares Statutory Trust II (the “Trusts”) set up to provide long-term financing. The Northview, Town, First Northwest, Suburban, and Community Financial Shares capital trusts were acquired as part of the acquisitions of Northview Financial Corporation, Town Bankshares, Ltd., First Northwest Bancorp, Inc., Suburban Illinois Bancorp, Inc. and Community Financial Shares, Inc., respectively. The Trusts were formed for purposes of issuing trust preferred securities to third-party investors and investing the proceeds from the issuance of the trust preferred securities and common securities solely in junior subordinated debentures issued by the Company (or assumed by the Company in connection with an acquisition), with the same maturities and interest rates as the trust preferred securities. The junior subordinated debentures are the sole assets of the Trusts. In each Trust, the common securities represent approximately 3% of the junior subordinated debentures and the trust preferred securities represent approximately 97% of the junior subordinated debentures. The Trusts are reported in the Company’s consolidated financial statements as unconsolidated subsidiaries. Accordingly, in the Consolidated Statements of Condition, the junior subordinated debentures issued by the Company to the Trusts are reported as liabilities and the common securities of the Trusts, all of which are owned by the Company, are included in investment securities. The following table provides a summary of the Company’s junior subordinated debentures as of March 31, 2022. The junior subordinated debentures represent the par value of the obligations owed to the Trusts.
(Dollars in thousands) | Common Securities |  | Trust Preferred Securities |  | Junior Subordinated Debentures |  | Rate Structure |  | Contractual Rate at 3/31/2022 |  | Issue Date |  | Maturity Date |  | Earliest Redemption Date
Wintrust Capital Trust III | $ | 774 |  |  | $ | 25,000 |  |  | $ | 25,774 |  |  | L+3.25 |  | 3.49 | % |  | 04/2003 |  | 04/2033 |  | 04/2008
Wintrust Statutory Trust IV | 619 |  |  | 20,000 |  |  | 20,619 |  |  | L+2.80 |  | 3.81 | % |  | 12/2003 |  | 12/2033 |  | 12/2008
Wintrust Statutory Trust V | 1,238 |  |  | 40,000 |  |  | 41,238 |  |  | L+2.60 |  | 3.61 | % |  | 05/2004 |  | 05/2034 |  | 06/2009
Wintrust Capital Trust VII | 1,550 |  |  | 50,000 |  |  | 51,550 |  |  | L+1.95 |  | 2.78 | % |  | 12/2004 |  | 03/2035 |  | 03/2010
Wintrust Capital Trust VIII | 1,238 |  |  | 25,000 |  |  | 26,238 |  |  | L+1.45 |  | 2.46 | % |  | 08/2005 |  | 09/2035 |  | 09/2010
Wintrust Capital Trust IX | 1,547 |  |  | 50,000 |  |  | 51,547 |  |  | L+1.63 |  | 2.46 | % |  | 09/2006 |  | 09/2036 |  | 09/2011
Northview Capital Trust I | 186 |  |  | 6,000 |  |  | 6,186 |  |  | L+3.00 |  | 3.32 | % |  | 08/2003 |  | 11/2033 |  | 08/2008
Town Bankshares Capital Trust I | 186 |  |  | 6,000 |  |  | 6,186 |  |  | L+3.00 |  | 3.32 | % |  | 08/2003 |  | 11/2033 |  | 08/2008
First Northwest Capital Trust I | 155 |  |  | 5,000 |  |  | 5,155 |  |  | L+3.00 |  | 4.01 | % |  | 05/2004 |  | 05/2034 |  | 05/2009
Suburban Illinois Capital Trust II | 464 |  |  | 15,000 |  |  | 15,464 |  |  | L+1.75 |  | 2.58 | % |  | 12/2006 |  | 12/2036 |  | 12/2011
Community Financial Shares Statutory Trust II | 109 |  |  | 3,500 |  |  | 3,609 |  |  | L+1.62 |  | 2.45 | % |  | 06/2007 |  | 09/2037 |  | 06/2012
Total |  |  |  |  | $ | 253,566 |  |  |  |  | 3.00 | % |  |  |  |  |  |
The junior subordinated debentures totaled $253.6 million at March 31, 2022, December 31, 2021 and March 31, 2021. The interest rates on the variable rate junior subordinated debentures are based on the three-month LIBOR rate and reset on a quarterly basis. At March 31, 2022, the weighted average contractual interest rate on the junior subordinated debentures was 3.00%. Prior to 2021, the Company entered into interest rate swaps with an aggregate notional value of $210.0 million to hedge the variable cash flows on certain junior subordinated debentures. Such interest rate swaps matured in 2021 and no separate hedging derivatives were outstanding at March 31, 2022. Distributions on the common and preferred securities issued by the Trusts are payable quarterly at a rate per annum equal to the interest rates being earned by the Trusts on the junior subordinated debentures. Interest expense on the junior subordinated debentures is deductible for income tax purposes. The Company has guaranteed the payment of distributions and payments upon liquidation or redemption of the trust preferred securities, in each case to the extent of funds held by the Trusts. The Company and the Trusts believe that, taken together, the obligations of the Company under the guarantees, the junior subordinated debentures, and other related agreements provide, in the aggregate, a full, irrevocable and unconditional guarantee, on a subordinated basis, of all of the obligations of the Trusts under the trust preferred securities. Subject to certain limitations, the Company has the right to defer the payment of interest on the junior subordinated debentures at any time, or from time to time, for a period not to exceed 20 consecutive quarters. The trust preferred securities are subject to mandatory redemption, in whole or in part, upon repayment of the junior subordinated debentures at maturity or their earlier redemption. The junior subordinated debentures are redeemable in whole or in part prior to maturity at any time after the earliest redemption dates shown in the table, and earlier at the discretion of the Company if certain conditions are met, and, in any event, only after the Company has obtained Federal Reserve Bank (“FRB”) approval, if then required under applicable guidelines or regulations. At March 31, 2022, the Company included $245.5 million of the junior subordinated debentures, net of common securities, in Tier 2 regulatory capital.

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