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FAIR VALUE MEASUREMENTS
 3 Months Ended
Mar. 31, 2026
Fair Value Disclosures [Abstract]  
FAIR VALUE MEASUREMENTS FAIR VALUE MEASUREMENTS
The term “fair value” is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability. The Company’s approach is to maximize the use of observable inputs and minimize the use of unobservable inputs when developing fair value measurements.
Fair Value Hierarchy
A three-level valuation hierarchy has been established under ASC 820 for disclosure of fair value measurements. The valuation hierarchy is based on the observability of inputs to the valuation of an asset or liability as of the measurement date. A financial instrument’s categorization within the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement. The levels are defined as follows:
•Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity can access at the measurement date. An active market for the asset or liability is a market in which transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis.
•Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. This includes quoted prices for similar assets and liabilities in active markets and inputs that are observable for the asset or liability for substantially the full term of the financial instrument.
•Level 3 – Unobservable inputs for the asset or liability. These inputs reflect the Company’s assumptions of what market participants would use in pricing the asset or liability.
The Company’s policy regarding transfers between levels of the fair value hierarchy is that all transfers are assumed to occur at the end of the reporting period.
Estimation of Fair Value
Fair value is based on quoted market prices, when available. In cases where a quoted price for an asset or liability is not available, the Company uses valuation models to estimate fair value. These models incorporate inputs such as forward yield curves, loan prepayment assumptions, expected loss assumptions, market volatilities and pricing spreads utilizing market-based inputs where readily available. The Company believes its valuation methods are appropriate and consistent with those that would be used by other market participants. However, imprecision in estimating unobservable inputs and other factors may result in these fair value measurements not reflecting the amount realized in an actual sale or transfer of the asset or liability in a current market exchange.
The following table summarizes the fair value measurement methodologies, including significant inputs and assumptions and classification of the Company’s assets and liabilities valued at fair value on a recurring basis.
Asset/Liability classValuation methodology, inputs and assumptionsClassification
Investment securities
U.S Treasury securities (Trading securities and Investment securities AFS)Fair Value is based on quoted prices in an active market.Level 1 recurring fair value measurement.
Investment securities AFS (level 2)Observable market prices of identical or similar securities are used where available.Level 2 recurring fair value measurement.
Investment securities AFS (level 3)
If market prices are not readily available, value is based on discounted cash flows using the following significant inputs:
•Expected prepayment speeds 
•Estimated credit losses 
•Market liquidity adjustments
Level 3 recurring fair value measurement.
LHFS
Single family loans
Fair value is based on observable market data, including:
•Quoted market prices, where available 
•Dealer quotes for similar loans 
•Forward sale commitments
Level 2 recurring fair value measurement.
Equity securitiesObservable market prices of identical or similar securities are used where available.Level 2 recurring fair value measurement.
Mortgage servicing rights
Single family MSRsFor information on how the Company measures the fair value of its single family MSRs, including key economic assumptions and the sensitivity of fair value to changes in those assumptions, see Note 9, “Mortgage Banking Operations.”Level 3 recurring fair value measurement.
Derivatives
Futures and OptionsFair value is based on closing exchange prices.Level 1 recurring fair value measurement.
Forward sale commitments and interest rate swaps
Fair value is based on quoted prices for identical or similar instruments, when available. When quoted prices are not available, fair value is based on internally developed modeling techniques, which require the use of multiple observable market inputs including:
•Forward interest rates 
•Interest rate volatilities
Level 2 recurring fair value measurement.
IRLC
The fair value considers several factors including:
•Fair value of the underlying loan based on quoted prices in the secondary market, when available. 
•Value of servicing
•Fall-out factor
Level 3 recurring fair value measurement.
The following tables present the levels of the fair value hierarchy for the Company’s assets and liabilities measured at fair value on a recurring basis:
March 31, 2026
(in thousands)Fair ValueLevel 1Level 2Level 3
Assets:
Trading securities - U.S. Treasury securities$49,463 $49,463 $— $— 
Securities available-for-sale:
Obligations of states and political subdivisions459,869 — 459,869 — 
Mortgage backed securities - residential2,807,719 — 2,806,170 1,549 
Mortgage backed securities - commercial357,981 — 357,981 — 
Collateralized loan obligations229,708 — 229,708 — 
Corporate bonds51,135 — 51,090 45 
U.S. Treasury securities20,536 20,536 — — 
Agency debentures6,757 — 6,757 — 
Total securities available-for-sale3,933,705 20,536 3,911,575 1,594 
Single family LHFS4,692 — 4,692 — 
Single family mortgage servicing rights57,630 — — 57,630 
Equity securities15,012 — 15,012 — 
Derivatives:
Forward loan sale commitments241 — 241 — 
Interest rate lock commitments130 — — 130 
Interest rate swaps8,927 — 8,927 — 
Futures2 2 — — 
Total assets$4,069,802 $70,001 $3,940,447 $59,354 
Liabilities:
Derivatives:
Forward loan sale commitments$482 $— $482 $— 
Interest rate lock commitments10 — — 10 
Interest rate swaps8,279 — 8,279 — 
Total liabilities$8,771 $— $8,761 $10 
December 31, 2025
(in thousands)Fair ValueLevel 1Level 2Level 3
Assets:
Trading securities - U.S. Treasury securities$49,518 $49,518 $— $— 
Securities available-for-sale:
Obligations of states and political subdivisions471,159 — 471,159 — 
Mortgage backed securities - residential2,884,289 — 2,882,704 1,585 
Mortgage backed securities - commercial371,806 — 371,806 — 
Collateralized loan obligations188,316 — 188,316 — 
Corporate bonds49,915 — 49,870 45 
U.S. Treasury securities20,669 20,669 — — 
Agency debentures7,231 — 7,231 — 
Total securities available-for-sale3,993,385 20,669 3,971,086 1,630 
Single family LHFS5,967 — 5,967 — 
Single family mortgage servicing rights58,095 — — 58,095 
Equity securities15,567 — 15,567 — 
Derivatives:
Forward loan sale commitments148 — 148 — 
Interest rate lock commitments75 — — 75 
Interest rate swaps9,406 — 9,406 — 
Total assets$4,132,161 $70,187 $4,002,174 $59,800 
Liabilities:
Derivatives:
Forward loan sale commitments$28 $— $28 $— 
Interest rate swaps8,543 — 8,543 — 
Futures2 2 — — 
Total liabilities $8,573 $2 $8,571 $— 
There were no transfers between levels of the fair value hierarchy for the quarter ended March 31, 2026 and 2025.
Level 3 Recurring Fair Value Measurements
The Company’s Level 3 recurring fair value measurements consist of investment securities AFS, single family MSRs, and interest rate lock commitments, which are accounted for as derivatives. For information regarding fair value changes and activity for single family MSRs for the quarter ended March 31, 2026, see Note 9, “Mortgage Banking Operations.”
The fair value of IRLCs considers several factors, including the fair value in the secondary market of the underlying loan resulting from the exercise of the commitment, the expected net future cash flows related to the associated servicing of the loan (referred to as the value of servicing) and the probability that the commitment will not be converted into a funded loan (referred to as a fall-out factor). The fair value of IRLCs on LHFS, while based on interest rates observable in the market, is highly dependent on the ultimate closing of the loans. The significance of the fall-out factor to the fair value measurement of an individual IRLC is generally highest at the time that the rate lock is initiated and declines as closing procedures are performed and the underlying loan gets closer to funding. The fall-out factor applied is based on historical experience. The value of servicing is impacted by a variety of factors, including prepayment assumptions, discount rates, delinquency rates, contractually specified servicing fees, servicing costs and underlying portfolio characteristics. Because these inputs are not observable in market trades, the fall-out factor and value of servicing are considered to be Level 3 inputs. The fair value of IRLCs decreases in value upon an increase in the fall-out factor and increases in value upon an increase in the value of servicing. Changes in the fall-out factor and value of servicing do not increase or decrease based on movements in other significant unobservable inputs.
The Company recognizes unrealized gains and losses from the time that an IRLC is initiated until the gain or loss is realized at the time the loan closes, which generally occurs within 30-90 days. For IRLCs that fall out, any unrealized gain or loss is reversed, which generally occurs at the end of the commitment period. The gains and losses recognized on IRLC
derivatives generally correlates to volume of single family interest rate lock commitments made during the reporting period (after adjusting for estimated fallout) while the amount of unrealized gains and losses realized at settlement generally correlates to the volume of single family closed loans during the reporting period.
The following information presents significant Level 3 unobservable inputs used to measure fair value of certain assets as of March 31, 2026 and December 31, 2025. Balances and activity from these Level 3 assets are reported beginning on the Merger date of September 2, 2025. Therefore, there were no balances or activity for the quarter ended March 31, 2025.
At March 31, 2026
(dollars in thousands)Fair ValueValuation
Technique		Significant Unobservable
Inputs		LowHighWeighted Average
March 31, 2026
Investment securities AFS$1,594 Income approachImplied spread to benchmark interest rate curve2.25%2.25%2.25%
Interest rate lock commitments, net120 Income approachFall-out factor1.10%20.60%11.94%
Value of servicing0.93%1.56%1.25%
December 31, 2025
Investment securities AFS$1,630 Income approachImplied spread to benchmark interest rate curve2.25%2.25%2.25%
Interest rate lock commitments, net75 Income approachFall-out factor0.60%20.65%10.11%
Value of servicing1.04%1.43%1.15%
The following table presents fair value changes and activity for Level 3 investment securities AFS:
Quarter Ended March 31,
(in thousands)20262025
Beginning balance$1,630 $— 
Additions— — 
Transfers — — 
Payoffs/sales6 — 
Change in mark to market(42)— 
Ending balance$1,594 $— 
The following table presents fair value changes and activity for Level 3 interest rate lock commitments:
Quarter Ended March 31,
(in thousands)20262025
Beginning balance, net$75 $— 
Total realized/unrealized gains433 — 
Settlements(388)— 
Ending balance, net$120 $— 
Assets and Liabilities Measured on a Nonrecurring Basis
Collateral Dependent Loan Receivables: The fair value of collateral dependent loan receivables with specific allocations of the allowance for credit losses based on collateral values is generally based on recent appraisals or evaluations. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are typically significant and result in a Level 3 classification of the inputs for determining fair value. Loss exposure for collateral dependent loans is typically determined by the “practical expedient” which allows these loans to be assessed using the fair value of collateral method, which compares the net realizable value of the collateral (fair value less costs of sale) to the amortized cost basis of the loan (carrying value).
The following tables present collateral dependent loans that were measured at fair value on a nonrecurring basis, and still held on the consolidated balance sheets, as well as the valuation methodology and unobservable inputs, and the net gains or losses resulting from those fair value adjustments for the periods indicated.
March 31, 2026
(in thousands)Fair ValueValuation TechniqueUnobservable InputInput or Range Weighted Average
Commercial and industrial loans$3,290 Third party appraisalDiscount for market conditions
10% - 20%
17%
Estimated selling costs
7% - 10%
10%
Third party evaluationEstimated selling costs7%7%
Commercial real estate loans$23,015 Third party appraisalDiscount for market conditions
10% - 52%
40%
Estimated selling costs
8% - 10%
10%
Income approachVacancy, collection loss, concessions15%15%
Capitalization rate7%7%
December 31, 2025
(in thousands)Fair ValueValuation TechniqueUnobservable InputInput or Range Weighted Average
Commercial and industrial loans$2,955 Third party appraisalDiscount for market conditions
10% - 20%
18%
Estimated selling costs10%10%
Third party evaluationEstimated selling costs7%7%
Commercial real estate loans$23,006 Third party appraisalDiscount for market conditions
6% - 36%
24%
Estimated selling costs
8% - 10%
10%
Income approachVacancy, collection loss, concessions15%15%
Capitalization rate6%6%
Quarter Ended March 31,
(in thousands)20262025
Net (gain) loss: (1)
Commercial and industrial loans$(79)$— 
Commercial real estate loans(77)— 
Total$(156)$— 
(1)The net (gain) loss represents re-measurements of collateral-dependent impaired loans with specific allowance for credit loss allocations.
Other real estate owned: Nonrecurring adjustments to certain commercial and residential real estate properties classified as other real estate owned are measured at the lower of the carrying amount or fair value, less costs to sell. Fair values are generally based on third party appraisals of the property or internal evaluations based on comparable sales, resulting in a Level 3 classification. Appraisals for both collateral-dependent impaired loans and real estate owned are performed by certified general appraisers (for commercial properties) or certified residential appraisers (for residential properties) whose qualifications and licenses have been reviewed and verified by the Company. Once received, a member of the Appraisal Department reviews the assumptions and approaches utilized in the appraisal as well as the overall resulting fair value in comparison with independent data sources such as recent market data or industry-wide statistics. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. In cases where the carrying amount exceeds the fair value, less cost to sell, an impairment loss is recognized. Management also considers inputs regarding market trends or other relevant factors and selling and commission costs.
Other real estate owned assets fall under a Level 3 fair value measurement methodology. The following tables present other real estate owned that were measured at fair value on a nonrecurring basis and still held on the consolidated balance sheets, as well as the valuation methodology, unobservable inputs and losses resulting from those fair value adjustments for the periods indicated.
March 31, 2026
(in thousands)Fair ValueValuation TechniqueUnobservable InputsInput or RangeWeighted Average
Other real estate owned-commercial real estate$3,535 Third party appraisalEstimated selling costs6%6%
Purchase and sale agreementEstimated selling costs7%7%
December 31, 2025
(in thousands)Fair ValueValuation TechniqueUnobservable InputsInputWeighted Average
Other real estate owned-commercial real estate$1,675 Income approachEstimated selling costs10%10%
Quarter Ended March 31,
(in thousands)20262025
Losses due to write downs:
Other real estate owned-commercial real estate (1)
$332 $— 
(1)Losses are included in other real estate owned related expense within noninterest expense on the consolidated income statements.
The following is a summary of the estimated fair value and carrying value of the Company’s financial instruments not recorded at fair value in the consolidated financial statements as of March 31, 2026 and December 31, 2025:
 March 31, 2026
Fair Value
(in thousands)Carrying
Value		TotalLevel 1Level 2Level 3
Assets:
Cash and cash equivalents$483,513 $483,513 $483,513 $— $— 
Securities held-to-maturity1,313,520 1,149,969 — 1,146,969 3,000 
Loan receivables, net13,695,413 13,193,078 — 13,193,078 
Mortgage servicing rights – multifamily and SBA26,370 27,282 — 27,282 — 
Liabilities:
Time deposits$2,144,670 $2,132,552 $— $2,132,552 $— 
Long-term debt128,815 140,594 — 140,594 — 
 December 31, 2025
Carrying
Value		Fair Value
(in thousands)TotalLevel 1Level 2Level 3
Assets:
Cash and cash equivalents$1,029,983 $1,029,983 $1,029,983 $— $— 
Securities held-to-maturity1,336,632 1,170,818 — 1,167,818 3,000 
Loan receivables, net14,023,617 13,665,520 — — 13,665,520 
Mortgage servicing rights – multifamily and SBA27,737 28,276 — 28,276 — 
Liabilities:
Time deposits$2,784,608 $2,768,873 $— $2,768,873 $— 
Long-term debt192,014 203,272 — 203,272 — 
Fair Value Option
Single family loans held for sale accounted under the fair value option are measured initially at fair value with subsequent changes in fair value recognized in earnings. Gains and losses from such changes in fair value are recognized in net gain on mortgage loan origination and sale activities within other noninterest income. The change in fair value of loans held for sale is primarily driven by changes in interest rates subsequent to loan funding and changes in fair value of the related servicing asset, resulting in revaluation adjustments to the recorded fair value. The use of the fair value option allows the change in the fair value of loans to more effectively offset the change in fair value of derivative instruments that are used as economic hedges of loans held for sale.
The following table presents the difference between the aggregate fair value and the aggregate unpaid principal balance of loans held for sale accounted for under the fair value option as of March 31, 2026 and December 31, 2025:
March 31, 2026December 31, 2025
(in thousands)Fair ValueAggregate Unpaid Principal BalanceFair Value Less Aggregated Unpaid Principal BalanceFair ValueAggregate Unpaid Principal BalanceFair Value Less Aggregated Unpaid Principal Balance
Single family LHFS$4,692 $4,648 $44 $5,967 $5,883 $84