XML 58 R48.htm IDEA: XBRL DOCUMENT
v3.23.2

FAIR VALUE (Tables) | 6 Months Ended
--- | ---
Jun. 30, 2023
FAIR VALUE [Abstract] |
Assets and Liabilities Measured at Fair Value on Recurring Basis [Table Text Block] | Assets and liabilities measured at fair value on a recurring basis are summarized below as of June 30, 2023 and December 31, 2022: As of June 30, 2023 As of December 31, 2022 Fair Value Measurements Using Fair Value Measurements Using Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total (In thousands) Assets: Debt securities available for sale: U.S. Treasury securities $ 139,669 $ - $ - $ 139,669 $ 138,875 $ - $ - $ 138,875 Noncallable U.S. agencies debt securities - 475,295 - 475,295 - 389,787 - 389,787 Callable U.S. agencies debt securities - 1,900,133 - 1,900,133 - 1,963,566 - 1,963,566 MBS - 2,910,915 5,246 (1) 2,916,161 - 3,098,797 5,794 (1) 3,104,591 Puerto Rico government obligations - - 2,111 2,111 - - 2,201 2,201 Other investments - - - - - - 500 500 Equity securities 4,891 - - 4,891 4,861 - - 4,861 Derivative assets - 494 - 494 - 633 - 633 Liabilities: Derivative liabilities - 357 - 357 - 476 - 476 (1) Related to private label MBS.
Fair Value of Assets and Liabilities Measured on Recurring Basis [Table Text Block] | The table below presents a reconciliation of the beginning and ending balances of all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the quarters and six-month periods ended June 30, 2023 and 2022: Quarter Ended June 30, Six-Month Period Ended June 30, 2023 2022 2023 2022 Level 3 Instruments Only Securities Available for Sale (1) Securities Available for Sale (1) Securities Available for Sale (1) Securities Available for Sale (1) (In thousands) Beginning balance $ 7,605 $ 10,647 $ 8,495 $ 11,084 Total (losses)/gains: Included in other comprehensive loss (unrealized) (19) (106) (181) (393) Included in earnings (unrealized) (2) 16 35 25 423 Principal repayments and amortization (245) (396) (982) (3) (934) Ending balance $ 7,357 $ 10,180 $ 7,357 $ 10,180 ___________________ (1) Amounts mostly related to private label MBS. (2) Changes in unrealized gains included in earnings were recognized within provision for credit losses - expense (benefit) and relate to assets still held as of the reporting date. (3) Includes a $ 0.5 million repayment of a matured debt security.
Fair Value Measurement Inputs and Valuation Techniques [Table Text Block] | The tables below present quantitative information for significant assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) as of June 30, 2023 and December 31, 2022: June 30, 2023 Fair Value Valuation Technique Unobservable Input Range Weighted Average Minimum Maximum (Dollars in thousands) Available-for-sale debt securities: Private label MBS $ 5,246 Discounted cash flows Discount rate 16.7% 16.7% 16.7% Prepayment rate 1.2% 12.0% 8.9% Projected cumulative loss rate 0.2% 15.5% 5.6% Puerto Rico government obligations $ 2,111 Discounted cash flows Discount rate 13.4% 13.4% 13.4% Projected cumulative loss rate 18.5% 18.5% 18.5% December 31, 2022 Fair Value Valuation Technique Unobservable Input Range Weighted Average Minimum Maximum (Dollars in thousands) Available-for-sale debt securities: Private label MBS $ 5,794 Discounted cash flows Discount rate 16.2% 16.2% 16.2% Prepayment rate 1.5% 15.2% 11.8% Projected cumulative loss rate 0.3% 15.6% 5.6% Puerto Rico government obligations $ 2,201 Discounted cash flows Discount rate 12.9% 12.9% 12.9% Projected cumulative loss rate 19.3% 19.3% 19.3%
Impairment or Valuation Adjustments were Recorded for Assets Recognized at Fair Value [Table Text Block] | As of June 30, 2023, the Corporation recorded losses or valuation adjustments for assets recognized at fair value on a non-recurring basis and still held at June 30, 2023, as shown in the following table: Carrying value as of June 30, 2023 Related to (losses) gains recorded for the Quarter Ended June 30, 2023 Related to (losses) gains recorded for the Six- Month Period Ended June 30, 2023 (Losses) gains recorded for the Quarter Ended June 30, 2023 (Losses) gains recorded for the Six-Month Period Ended June 30, 2023 (In thousands) Level 3: Loans receivable (1) $ 8,011 $ 8,920 $ (6,515) $ (6,744) OREO (2) 1,471 2,038 45 12 Level 2: Loans held for sale (3) $ 14,295 $ 14,295 $ (73) $ (73) (1) Consists mainly of collateral dependent commercial and construction loans. The Corporation generally measured losses based on the fair value of the collateral. The Corporation derived the fair values from external appraisals that took into consideration prices in observed transactions involving similar assets in similar locations but adjusted for specific characteristics and assumptions of the collateral (e.g., absorption rates), which are not market observable. (2) The Corporation derived the fair values from appraisals that took into consideration prices in observed transactions involving similar assets in similar locations but adjusted for specific characteristics and assumptions of the properties (e.g., absorption rates and net operating income of income producing properties), which are not market observable. Losses were related to market valuation adjustments after the transfer of the loans to the OREO portfolio. (3) The Corporation derived the fair value of these loans based on secondary market prices of instruments with similar characteristics. As of June 30, 2022, the Corporation recorded losses or valuation adjustments for assets recognized at fair value on a non-recurring basis and still held at June 30, 2022, as shown in the following table: Carrying value as of June 30, 2022 Related to (losses) gains recorded for the Quarter Ended June 30, 2022 Related to losses recorded for the Six- Month Period Ended June 30, 2022 (Losses) gains recorded for the Quarter Ended June 30, 2022 Losses recorded for the Six-Month Period Ended June 30, 2022 (In thousands) Level 3: Loans receivable (1) $ 5,422 $ 29,967 $ (817) $ (3,848) OREO (2) 2,140 2,741 35 (38) Premises and equipment (3) - 1,242 - (218) (1) Consists mainly of collateral dependent commercial and construction loans. The Corporation generally measured losses based on the fair value of the collateral. The Corporation derived the fair values from external appraisals that took into consideration prices in observed transactions involving similar assets in similar locations but adjusted for specific characteristics and assumptions of the collateral (e.g., absorption rates), which are not market observable. (2) The Corporation derived the fair values from appraisals that took into consideration prices in observed transactions involving similar assets in similar locations but adjusted for specific characteristics and assumptions of the properties (e.g., absorption rates and net operating income of income producing properties), which are not market observable. Losses were related to market valuation adjustments after the transfer of the loans to the OREO portfolio. (3) Relates to a banking facility reclassified to held-for-sale and measured at the fair value of the collateral.
Estimated Fair Value and Carrying Value of Financial Instruments [Table Text Block] | The following tables present the carrying value, estimated fair value and estimated fair value level of the hierarchy of financial instruments as of June 30, 2023 and December 31, 2022: Total Carrying Amount in Statement of Financial Condition as of June 30, 2023 Fair Value Estimate as of June 30, 2023 Level 1 Level 2 Level 3 (In thousands) Assets: Cash and due from banks and money market investments (amortized cost) $ 1,047,534 $ 1,047,534 $ 1,047,534 $ - $ - Available-for-sale debt securities (fair value) 5,433,369 5,433,369 139,669 5,286,343 7,357 Held-to-maturity debt securities (amortized cost) 424,726 Less: ACL on held-to-maturity debt securities (8,401) Held-to-maturity debt securities, net of ACL $ 416,325 410,181 - 244,521 165,660 Equity securities (amortized cost) 43,210 43,210 - 43,210 (1) - Other equity securities (fair value) 4,891 4,891 4,891 - - Loans held for sale (lower of cost or market) 14,295 14,295 - 14,295 - Loans held for investment (amortized cost) 11,719,315 Less: ACL for loans and finance leases (267,058) Loans held for investment, net of ACL $ 11,452,257 11,256,830 - - 11,256,830 MSRs (amortized cost) 28,034 44,420 - - 44,420 Derivative assets (fair value) (2) 494 494 - 494 - Liabilities: Deposits (amortized cost) $ 16,819,692 $ 16,820,272 $ - $ 16,820,272 $ - Short-term securities sold under agreements to repurchase (amortized cost) 73,934 74,030 - 74,030 - Advances from the FHLB (amortized cost): Long-term 500,000 495,589 - 495,589 - Other long-term borrowings (amortized cost) 161,700 162,983 - - 162,983 Derivative liabilities (fair value) (2) 357 357 - 357 - (1) Includes FHLB stock with a carrying value of $ 34.7 million, which are considered restricted. (2) Includes interest rate swap agreements, interest rate caps, forward contracts, interest rate lock commitments, and forward loan sales commitments. Total Carrying Amount in Statement of Financial Condition as of December 31, 2022 Fair Value Estimate as of December 31, 2022 Level 1 Level 2 Level 3 (In thousands) Assets: Cash and due from banks and money market investments (amortized cost) $ 480,505 $ 480,505 $ 480,505 $ - $ - Available-for-sale debt securities (fair value) 5,599,520 5,599,520 138,875 5,452,150 8,495 Held-to-maturity debt securities (amortized cost) 437,537 Less: ACL on held-to-maturity debt securities (8,286) Held-to-maturity debt securities, net of ACL $ 429,251 427,115 - 260,106 167,009 Equity securities (amortized cost) 50,428 50,428 - 50,428 (1) - Other equity securities (fair value) 4,861 4,861 4,861 - - Loans held for sale (lower of cost or market) 12,306 12,306 - 12,306 - Loans held for investment (amortized cost) 11,552,825 Less: ACL for loans and finance leases (260,464) Loans held for investment, net of ACL $ 11,292,361 11,106,809 - - 11,106,809 MSRs (amortized cost) 29,037 44,710 - - 44,710 Derivative assets (fair value) (2) 633 633 - 633 - Liabilities: Deposits (amortized cost) $ 16,143,467 $ 16,139,937 $ - $ 16,139,937 $ - Short-term securities sold under agreements to repurchase (amortized cost) 75,133 75,230 - 75,230 - Advances from the FHLB (amortized cost) Short-term 475,000 474,731 - 474,731 - Long-term 200,000 199,865 - 199,865 - Other long-term borrowings (amortized cost) 183,762 187,246 - - 187,246 Derivative liabilities (fair value) (2) 476 476 - 476 - (1) Includes FHLB stock with a carrying value of $ 42.9 million, which are considered restricted. (2) Includes interest rate swap agreements, interest rate caps, forward contracts, interest rate lock commitments, and forward loan sales commitments.

X
- Definition Tabular disclosure of input and valuation technique used to measure fair value and change in valuation approach and technique for each separate class of asset and liability measured on recurring and nonrecurring basis. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (bbb) -SubTopic 10 -Topic 820 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482106/820-10-50-2 + Details
Name: | us-gaap_FairValueAssetsAndLiabilitiesMeasuredOnRecurringAndNonrecurringBasisValuationTechniquesTableTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition Tabular disclosure of assets and liabilities by class, including financial instruments measured at fair value that are classified in shareholders' equity, if any, that are measured at fair value on a nonrecurring basis in periods after initial recognition (for example, impaired assets). Disclosures may include, but are not limited to: (a) the fair value measurements recorded and the reasons for the measurements and (b) the level within the fair value hierarchy in which the fair value measurements are categorized in their entirety (levels 1, 2, 3). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (bbb) -SubTopic 10 -Topic 820 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482106/820-10-50-2 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482106/820-10-50-2 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482106/820-10-50-2 + Details
Name: | us-gaap_FairValueAssetsMeasuredOnNonrecurringBasisTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (c) -SubTopic 10 -Topic 820 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482106/820-10-50-2 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 3 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482106/820-10-50-3 + Details
Name: | us-gaap_FairValueAssetsMeasuredOnRecurringBasisUnobservableInputReconciliationTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition Tabular disclosure of the fair value of financial instruments, including financial assets and financial liabilities, and the measurements of those instruments, assets, and liabilities. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482106/820-10-50-2 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 11 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482907/825-10-50-11 + Details
Name: | us-gaap_FairValueByBalanceSheetGroupingTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

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 Tabular disclosure of assets and liabilities, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3). + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482106/820-10-50-2 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482106/820-10-50-2 + Details
Name: | us-gaap_ScheduleOfFairValueAssetsAndLiabilitiesMeasuredOnRecurringBasisTableTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration