XML 53 R33.htm IDEA: XBRL DOCUMENT
v3.25.1

Fair value measurement | 3 Months Ended
--- | ---
Mar. 31, 2025
Fair Value Disclosures |
Fair Value Measurement | Note 23 – Fair value measurement ASC Subtopic 820-10 “Fair Value Measurements and Disclosures” establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels in order to increase consistency and comparability in fair value measurements and disclosures. The hierarchy is broken down into three levels based on the reliability of inputs as follows: ● Level 1 - Unadjusted quoted prices in active markets for identical assets or liabilities that the Corporation has the ability to access at the measurement date. Valuation on these instruments does not necessitate a significant degree of judgment since valuations are based on quoted prices that are readily available in an active market. ● Level 2 - Quoted prices other than those included in Level 1 that are observable either directly or indirectly. Level 2 inputs include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or that can be corroborated by observable market data for substantially the full term of the financial instrument. ● Level 3 - Inputs are unobservable and significant to the fair value measurement. Unobservable inputs reflect the Corporation’s own judgements about assumptions that market participants would use in pricing the asset or liability. The Corporation maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the observable inputs be used when available. Fair value is based upon quoted market prices when available. If listed prices or quotes are not available, the Corporation employs internally-developed models that primarily use market-based inputs including yield curves, interest rates, volatilities, and credit curves, among others. Valuation adjustments are limited to those necessary to ensure that the financial instrument’s fair value is adequately representative of the price that would be received or paid in the marketplace. These adjustments include amounts that reflect counterparty credit quality, the Corporation’s credit standing, constraints on liquidity and unobservable parameters that are applied consistently. There have been no changes in the Corporation’s methodologies used to estimate the fair value of assets and liabilities from those disclosed in the 2024 Form 10-K. The estimated fair value may be subjective in nature and may involve uncertainties and matters of significant judgment for certain financial instruments. Changes in the underlying assumptions used in calculating fair value could significantly affect the results. Fair Value on a Recurring and Nonrecurring Basis The following fair value hierarchy tables present information about the Corporation’s assets and liabilities measured at fair value on a recurring basis at March 31, 2025 and December 31, 2024: At March 31, 2025 (In thousands) Level 1 Level 2 Level 3 Measured at NAV Total RECURRING FAIR VALUE MEASUREMENTS Assets Debt securities available-for-sale: U.S. Treasury securities $ 8,601,447 $ 5,672,521 $ - $ - $ 14,273,968 Collateralized mortgage obligations - federal agencies - 115,859 - - 115,859 Mortgage-backed securities - 5,102,146 457 - 5,102,603 Other - - 750 - 750 Total debt securities available-for-sale $ 8,601,447 $ 10,890,526 $ 1,207 $ - $ 19,493,180 Trading account debt securities, excluding derivatives: U.S. Treasury securities $ 8,524 $ 10 $ - $ - $ 8,534 Obligations of Puerto Rico, States and political subdivisions - 53 - - 53 Collateralized mortgage obligations - 636 - - 636 Mortgage-backed securities - 19,043 84 - 19,127 Other - - 127 - 127 Total trading account debt securities, excluding derivatives $ 8,524 $ 19,742 $ 211 $ - $ 28,477 Equity securities $ - $ 45,129 $ - $ 407 $ 45,536 Mortgage servicing rights - - 104,743 - 104,743 Loans held-for-sale - 5,077 - - 5,077 Derivatives - 20,828 - - 20,828 Total assets measured at fair value on a recurring basis $ 8,609,971 $ 10,981,302 $ 106,161 $ 407 $ 19,697,841 Liabilities Derivatives $ - $ (19,523) $ - $ - $ (19,523) Total liabilities measured at fair value on a recurring basis $ - $ (19,523) $ - $ - $ (19,523) At December 31, 2024 (In thousands) Level 1 Level 2 Level 3 Measured at NAV Total RECURRING FAIR VALUE MEASUREMENTS Assets Debt securities available-for-sale: U.S. Treasury securities $ 7,512,171 $ 5,482,939 $ - $ - $ 12,995,110 Collateralized mortgage obligations - federal agencies - 120,284 - - 120,284 Mortgage-backed securities - 5,127,775 484 - 5,128,259 Other - - 2,250 - 2,250 Total debt securities available-for-sale $ 7,512,171 $ 10,730,998 $ 2,734 $ - $ 18,245,903 Trading account debt securities, excluding derivatives: U.S. Treasury securities $ 2,814 $ 10 $ - $ - $ 2,824 Obligations of Puerto Rico, States and political subdivisions - 55 - - 55 Collateralized mortgage obligations - 655 - - 655 Mortgage-backed securities - 29,032 84 - 29,116 Other - - 133 - 133 Total trading account debt securities, excluding derivatives $ 2,814 $ 29,752 $ 217 $ - $ 32,783 Equity securities $ - $ 45,664 $ - $ 381 $ 46,045 Mortgage servicing rights - - 108,103 - 108,103 Loans held-for-sale - 5,423 - - 5,423 Derivatives - 26,023 - - 26,023 Total assets measured at fair value on a recurring basis $ 7,514,985 $ 10,837,860 $ 111,054 $ 381 $ 18,464,280 Liabilities Derivatives $ - $ (22,832) $ - $ - $ (22,832) Total liabilities measured at fair value on a recurring basis $ - $ (22,832) $ - $ - $ (22,832) Loans held-for-sale measured at fair value Loans held-for-sale measured at fair value were priced based on secondary market prices. These loans are classified as Level 2. The following tables summarize the difference between the aggregate fair value and the aggregate unpaid principal balance for mortgage loans originated as held-for-sale measured at fair value as of March 31, 2025 and December 31, 2024. (In thousands) March 31, 2025 Aggregate Unpaid Fair Value Principal Balance Difference Loans held for sale $ 5,077 $ 4,938 $ 139 (In thousands) December 31, 2024 Aggregate Unpaid Fair Value Principal Balance Difference Loans held for sale $ 5,423 $ 5,436 $ (13) No loans held-for-sale were 90 or more days past due or on nonaccrual status as of March 31, 2025 and December 31, 2024. The fair value information included in the following tables is not as of period end, but as of the date that the fair value measurement was recorded during the quarters ended March 31, 2025 and 2024 and excludes nonrecurring fair value measurements of assets no longer outstanding as of the reporting date. Quarter ended March 31, 2025 (In thousands) Level 1 Level 2 Level 3 Total NONRECURRING FAIR VALUE MEASUREMENTS Assets Write-downs Loans [1] $ - $ - $ 4,167 $ 4,167 $ (362) Other real estate owned [2] - - 2,018 2,018 (485) Other foreclosed assets [2] - - 133 133 (76) Total assets measured at fair value on a nonrecurring basis $ - $ - $ 6,318 $ 6,318 $ (923) [1] Relates mainly to certain impaired collateral dependent loans. The impairment was measured based on the fair value of the collateral, which is derived from appraisals that take into consideration prices in observed transactions involving similar assets in similar locations. Costs to sell are excluded from the reported fair value amount. [2] Represents the fair value of foreclosed real estate and other collateral owned that were written down to their fair value. Costs to sell are excluded from the reported fair value amount. Quarter ended March 31, 2024 (In thousands) Level 1 Level 2 Level 3 Total NONRECURRING FAIR VALUE MEASUREMENTS Assets Write-downs Loans [1] $ - $ - $ 110 $ 110 $ (2,172) Other real estate owned [2] - - 1,416 1,416 (224) Other foreclosed assets [2] - - 105 105 (41) Total assets measured at fair value on a nonrecurring basis $ - $ - $ 1,631 $ 1,631 $ (2,437) [1] Relates mainly to certain impaired collateral dependent loans. The impairment was measured based on the fair value of the collateral, which is derived from appraisals that take into consideration prices in observed transactions involving similar assets in similar locations. Costs to sell are excluded from the reported fair value amount. [2] Represents the fair value of foreclosed real estate and other collateral owned that were written down to their fair value. Costs to sell are excluded from the reported fair value amount. Quarter ended March 31, 2025 MBS Other MBS Other classified securities classified securities as debt classified as as trading classified securities debt securities account as trading Mortgage available- available- debt account debt servicing Total (In thousands) for-sale for-sale securities securities rights assets Balance at December 31, 2024 $ 484 $ 2,250 $ 84 $ 133 $ 108,103 $ 111,054 Gains (losses) included in earnings - - - (6) (3,570) (3,576) Gains (losses) included in OCI (2) - - - - (2) Additions - - - - 210 210 Settlements (25) - - - - (25) Transfers out of Level 3 - (1,500) - - - (1,500) Balance at March 31, 2025 $ 457 $ 750 $ 84 $ 127 $ 104,743 $ 106,161 Changes in unrealized gains (losses) included in earnings relating to assets still held at March 31, 2025 $ - $ - $ - $ 9 $ (1,325) $ (1,316) Quarter ended March 31, 2024 MBS Other Other classified securities CMOs MBS securities as debt classified as classified classified classified securities debt securities as trading as trading as trading Mortgage available- available- account debt account debt account debt servicing Total (In thousands) for-sale for-sale securities securities securities rights assets Balance at December 31, 2023 $ 606 $ 2,500 $ 5 $ 112 $ 167 $ 118,109 $ 121,499 Gains (losses) included in earnings - (500) - - (1) (3,439) (3,940) Gains (losses) included in OCI 1 - - - - - 1 Additions - - - - - 294 294 Settlements - - (5) (28) - - (33) Balance at March 31, 2024 $ 607 $ 2,000 $ - $ 84 $ 166 $ 114,964 $ 117,821 Changes in unrealized gains (losses) included in earnings relating to assets still held at March 31, 2024 $ - $ (500) $ - $ - $ 2 $ (1,202) $ (1,700) Gains and losses (realized and unrealized) included in earnings for the quarters ended March 31, 2025 and 2024 for Level 3 assets and liabilities included in the previous tables are reported in the consolidated statements of operations as follows: Quarter ended March 31, 2025 Quarter ended March 31, 2024 Changes in unrealized Changes in unrealized Total gains gains (losses) relating to Total gains gains (losses) relating to (losses) included assets still held at (losses) included assets still held at (In thousands) in earnings reporting date in earnings reporting date Mortgage banking activities $ (3,570) $ (1,325) $ (3,439) $ (1,202) Trading account (loss) profit (6) 9 (1) 2 Provision for credit losses - - (500) (500) Total $ (3,576) $ (1,316) $ (3,940) $ (1,700) The following tables include quantitative information about significant unobservable inputs used to derive the fair value of Level 3 instruments, excluding those instruments for which the unobservable inputs were not developed by the Corporation such as prices of prior transactions and/or unadjusted third-party pricing sources at March 31, 2025 and 2024. Fair value at March 31, (In thousands) 2025 Valuation technique Unobservable inputs Weighted average (range) [1] Other - trading $ 127 Discounted cash flow model Weighted average life 2 years Yield 12 .0% Prepayment speed 10.8 % Loans held-in-portfolio $ 4,167 [2] External appraisal Haircut applied on external appraisals 7.5 % ( 5.0 % - 10.0 %) [1] Weighted average of significant unobservable inputs used to develop Level 3 fair value measurements were calculated by relative fair value. [2] Loans held-in-portfolio in which haircuts were not applied to external appraisals were excluded from this table. Fair value at March 31, (In thousands) 2024 Valuation technique Unobservable inputs Weighted average (range) [1] Other - trading $ 166 Discounted cash flow model Weighted average life 2.3 years Yield 12 .0% Prepayment speed 10.8 % Loans held-in-portfolio $ 110 [2] External appraisal Haircut applied on external appraisals 10 .0% [1] Weighted average of significant unobservable inputs used to develop Level 3 fair value measurements were calculated by relative fair value. [2] Loans held-in-portfolio in which haircuts were not applied to external appraisals were excluded from this table.

X
- References No definition available. + Details
Name: | us-gaap_FairValueDisclosuresAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 107 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-107 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 100 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-100 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (c)(3) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2E -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2E Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (g) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 940 -SubTopic 820 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147478119/940-820-50-1 + Details
Name: | us-gaap_FairValueDisclosuresTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration