XML 31 R16.htm IDEA: XBRL DOCUMENT
v3.25.1

Derivative and Hedging Activities | 3 Months Ended
--- | ---
Mar. 31, 2025
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Derivative Instruments and Hedging Activities Disclosure [Text Block] | Derivative and Hedging Activities The Corporation enters into derivative financial instruments to manage exposures that arise from business activities that result in the payment of future known and uncertain cash amounts, the value of which are determined by interest and currency rates as well as other economic conditions. At inception, the Corporation designates the derivative contract as either a fair value hedge (i.e., a hedge of the fair value of a recognized asset or liability), a cash flow hedge (i.e., a hedge of the variability of cash flows to be received or paid related to a recognized asset or liability), or a non-designated hedge. The hedge accounting methodologies applied for fair value, cash flow, and non-designated hedges are described in the Derivative and Hedging Activities note in the Corporation's 2024 Annual Report on Form 10-K. The contract or notional amount of a derivative is used to determine, along with the other terms of the derivative, the amounts to be exchanged between the counterparties. The Corporation is exposed to credit risk in the event of nonperformance by counterparties to financial instruments. To mitigate the counterparty risk, contracts generally contain language outlining collateral pledging requirements for each counterparty. For non-centrally cleared derivatives, collateral must be posted when the market value exceeds certain mutually agreed upon threshold limits. Securities and cash are often pledged as collateral. The Corporation pledged $80 million and $81 million of investment securities as collateral at March 31, 2025, and December 31, 2024, respectively. Cash is often pledged as collateral for derivatives that are not centrally cleared. The Corporation's required cash collateral was $9 million at March 31, 2025 and was approximately $250,000 at December 31, 2024. For fair value information and disclosures and for the Corporation's accounting policy for derivative and hedging activities, see the Fair Value Measurements and Summary of Significant Accounting Policies notes in the Corporation's 2024 Annual Report on Form 10-K. The following table presents the total notional amounts and gross fair values of the Corporation's derivatives, as well as the balance sheet netting adjustments:
|  | Mar 31, 2025 | Dec 31, 2024
|  | Asset | Liability | Asset | Liability
($ in thousands) |  | Notional Amount | Fair Value | Notional Amount | Fair Value | Notional Amount | Fair Value | Notional Amount | Fair Value
Designated as hedging instruments: |  |  |  |  |  |  |  |  |
Interest rate-related instruments(a) |  | $ | 2,750,000 |  | $ | 8,813 |  | $ | 250,000 |  | $ | 418 |  | $ | 1,950,000 |  | $ | 2,960 |  | $ | 1,150,000 |  | $ | 2,976 |
Foreign currency exchange forwards |  | 302,233 |  | 1,460 |  | 41,696 |  | 115 |  | 127,518 |  | 2,457 |  | 216,665 |  | 563 |
Total designated as hedging instruments |  | 10,273 |  |  | 533 |  |  | 5,418 |  |  | 3,539 |
Not designated as hedging instruments: |  |  |  |  |  |  |  |  |
Interest rate-related and other instruments |  | 4,040,636 |  | 81,446 |  | 6,835,672 |  | 136,453 |  | 3,858,867 |  | 88,541 |  | 6,992,894 |  | 170,928 |
Foreign currency exchange forwards |  | 105,979 |  | 2,085 |  | 39,418 |  | 1,846 |  | 68,028 |  | 4,315 |  | 74,199 |  | 4,106 |
Mortgage banking(b) |  | 55,617 |  | 988 |  | 100,500 |  | 583 |  | 28,580 |  | 580 |  | 85,000 |  | — |
Total not designated as hedging instruments |  | 84,518 |  |  | 138,883 |  |  | 93,436 |  |  | 175,034 |
Gross derivatives before netting |  |  | 94,791 |  |  | 139,416 |  |  | 98,854 |  |  | 178,573 |
Less: Legally enforceable master netting agreements | 14,744 |  |  | 14,744 |  |  | 12,667 |  |  | 12,667 |
Less: Cash collateral pledged/received | 19,389 |  |  | 140 |  |  | 35,190 |  |  | 250 |
Total derivative instruments, after netting | $ | 60,658 |  |  | $ | 124,532 |  |  | $ | 50,997 |  |  | $ | 165,656 |
(a) The notional amounts of the interest rate-related instruments designated as hedging instruments include forward starting interest rate swaps. As of March 31, 2025 such swaps with effective dates of November 1, 2025 had an asset notional amount and fair value of $150 million and $2 million, respectively. As of December 31, 2024 such swaps with effective dates ranging from February 1, 2025 to March 1, 2025 had an asset notional amount and fair value of $100 million and approximately $333,000, respectively, and a liability notional amount and fair value of $300 million and $1 million, respectively. (b) The notional amount of the mortgage derivative asset includes interest rate lock commitments, while the notional amount of the mortgage derivative liability includes forward commitments. As of March 31, 2025 the fair value amount of the mortgage derivative asset included interest rate lock commitments, while the fair value amount of the mortgage derivative liability included forward commitments. As of December 31, 2024 the fair value of the mortgage derivative asset included approximately $327,000 of interest rate lock commitments and approximately $254,000 of forward commitments. The following table presents amounts that were recorded on the consolidated balance sheets related to cumulative basis adjustments for fair value hedges:
| Line Item in the Consolidated Balance Sheets in Which the Hedged Item is Included
| Carrying Amount of the Hedged Assets/(Liabilities)(a) | Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets/(Liabilities) | Carrying Amount of the Hedged Assets/(Liabilities)(a) | Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets/(Liabilities)
($ in thousands) | Mar 31, 2025 | Dec 31, 2024
Other long-term funding | $ | (299,479) |  | $ | 521 |  | $ | (296,004) |  | $ | 3,996 |
FHLB advances | (595,778) |  | 4,222 |  | (592,256) |  | 7,744 |
Total | $ | (895,257) |  | $ | 4,743 |  | $ | (888,260) |  | $ | 11,740 |
(a) Excludes hedged items where only foreign currency risk is the designated hedged risk. At March 31, 2025 and December 31, 2024, the carrying amount excluded for foreign currency denominated loans was $344 million. The Corporation terminated its $500 million fair value hedge during the fourth quarter of 2019. At March 31, 2025, the amortized cost basis of the closed portfolios which had previously been used in the terminated hedging relationship was $212 million and is included in loans on the consolidated balance sheets. This amount includes approximately $807,000 of hedging adjustments on the discontinued hedging relationships, which are not presented in the table above. The tables below identify the effect of fair value and cash flow hedge accounting on the Corporation's consolidated statements of income:
| Location and Amount Recognized on the Consolidated Statements of Income in Fair Value and Cash Flow Hedging Relationships
| Three Months Ended Mar 31, |
| 2025 | 2024 |  |
($ in thousands) | Interest Income | Interest Expense | Interest Income | Interest Expense |  |  |  |
Total amounts of income/expense presented on the consolidated statements of income in which the effects of the fair value or cash flow hedges are recorded(a) | $ | (1,149) |  | $ | 2,219 |  | $ | (4,863) |  | $ | 5,322 |  |  |  |  |
The effects of fair value and cash flow hedging: Impact on fair value hedging relationships in Subtopic 815-20 |  |  |  |  |  |  |  |
Interest contracts: |  |  |  |  |  |  |  |
Hedged items | (32) |  | 6,997 |  | (40) |  | (10,210) |  |  |  |  |
Derivatives designated as hedging instruments(a) | (1,118) |  | (4,778) |  | (4,823) |  | 15,532 |  |  |  |  |
(a) Includes net settlements on the derivatives.
| Location and Amount Recognized on the Consolidated Statements of Income in Fair Value Hedging Relationships
| Three Months Ended Mar 31, |
| 2025 | 2024 |  |
($ in thousands) | Capital Markets, Net | Capital Markets, Net |  |
Total amounts of income/expense presented on the consolidated statements of income in which the effects of the fair value hedges are recorded | $ | 1 |  | $ | — |  |  |
The effects of fair value hedging: Impact on fair value hedging relationships in Subtopic 815-20 |  |  |  |
Foreign currency contracts: |  |  |  |
Hedged items | 553 |  | (9,070) |  |  |
Derivatives designated as hedging instruments | (551) |  | 9,070 |  |  |
The following table presents the effect of cash flow hedge accounting on accumulated other comprehensive income (loss):
| Three Months Ended Mar 31, |
($ in thousands) | 2025 | 2024 |  |
Interest rate-related instruments designated as cash flow hedging instruments |  |  |  |
Amount of income (loss) recognized in OCI on cash flow hedge derivatives(a) | $ | 7,268 |  | $ | (19,461) |  |  |
Amount of loss reclassified from accumulated other comprehensive income (loss) into interest income(a) | 1,118 |  | 4,823 |  |  |
(a) The entirety of gains (losses) recognized in OCI as well as the losses reclassified from accumulated other comprehensive income (loss) into interest income were included components in the assessment of hedge effectiveness. Amounts reported in accumulated other comprehensive income (loss) related to cash flow hedge derivatives are reclassified to interest income as interest payments are made on the hedged variable interest rate assets. The Corporation estimates that $1 million will be reclassified as an increase to interest income over the next 12 months. This amount could differ from amounts actually recognized due to changes in interest rates, hedge de-designations, or the addition of other hedges subsequent to March 31, 2025. The maximum length of time over which the Corporation is hedging its exposure to the variability in future cash flows is 33 months as of March 31, 2025. The table below identifies the effect of derivatives not designated as hedging instruments on the Corporation's consolidated statements of income:
| Consolidated Statements of Income Category of Gain / (Loss) Recognized in Income | Three Months Ended Mar 31, |
($ in thousands) | 2025 | 2024 |  |
Derivative instruments |  |  |  |  |
Interest rate-related and other instruments — customer and mirror, net | Capital markets, net | $ | (48) |  | $ | (71) |  |  |
Interest rate-related instruments — MSRs hedge | Mortgage banking, net | 1,466 |  | (2,937) |  |  |
Foreign currency exchange forwards | Capital markets, net | 500 |  | 746 |  |  |
Interest rate lock commitments (mortgage) | Mortgage banking, net | 661 |  | 227 |  |  |
Forward commitments (mortgage) | Mortgage banking, net | (837) |  | 451 |  |  |

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

X
- Definition The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 40 -Name Accounting Standards Codification -Section 50 -Paragraph 5 -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480237/815-40-50-5 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 5C -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480434/815-10-50-5C Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 815 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/815/tableOfContent + Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration