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Derivatives
 6 Months Ended
Jun. 30, 2024
Derivatives [Abstract]  
Derivatives DERIVATIVES
To a limited extent, the Company utilizes interest rate swaps contracts with clients and counterparty banks for the purpose of offsetting or hedging exposures arising out of lending and borrowing transactions. The Company offers borrowers interest rate swaps under a "back-to-back" loan hedging program and offsets these "pay floating/receive fixed" contracts with borrowers with "receive floating/pay fixed" swaps with counterparty banks. The total notional balance of these offsetting hedging contracts was $165.1 million at June 30, 2024. The Company has also hedged the interest rate risk and foreign currency risk on €25.8 million of subordinated debt utilizing a combined cross currency swap/interest rate swap, which has had the effect of hedging the foreign currency risk and fixing the Euribor-based floating rate instrument at a fixed rate of 2.76% through July 2025. The outputs from the Company's NII simulation analysis and EVE modeling reflect the impact of these interest rate/currency swaps, however, the impact is not material. Our derivatives are carried at fair value and recorded in "Other assets" or "Accrued interest payable and other liabilities," as appropriate, in the consolidated balance sheets. For derivatives not designated as hedging instruments, the changes in fair value of our derivatives and the related fees are recognized in "Noninterest income - other" in the condensed consolidated statements of earnings (loss). For the six months ended June 30, 2024, changes in fair value and fees recorded in noninterest income in the condensed consolidated statements of earnings (loss) were immaterial.
Included in the interest rate contracts in the table below are pay-fixed, receive-floating interest rate swap contracts classified as cash flow hedges with notional amounts aggregating $300.0 million, five year terms, and varying maturity dates throughout 2028. Also included in the interest rate contracts in the table below are pay-fixed, receive-floating interest rate swap contracts classified as cash flow hedges with notional amounts aggregating $355.0 million, with various forward-starting dates in 2024 and varying maturity dates throughout 2024 and 2025. All of these swap contracts were entered into with institutional counterparties to hedge against variability in cash flow attributable to interest rate risk on a portion of the Company's variable rate deposits and borrowings. The cash flow hedges were deemed highly effective at inception and thereafter. For derivatives designated as cash flow hedges, the portion of changes in fair value considered to be highly effective are reported as a component of "Accumulated other comprehensive loss, net" on the consolidated balance sheets until the related cash flows from the hedged items are recognized in earnings. As of June 30, 2024, the fair value of the cash flow hedges represented a net asset of $2.4 million, related to which a gain of $0.7 million (net of tax) was included in "Accumulated other comprehensive loss, net."
The following table presents the U.S. dollar notional amounts and fair values of our derivative instruments included in the condensed consolidated balance sheets as of the dates indicated:
June 30, 2024December 31, 2023
NotionalFairNotionalFair
AmountValueAmountValue
(In thousands)
Derivative Assets:
Interest rate contracts$820,127 $10,053 $168,850 $6,426 
Foreign exchange contracts47,646 674 45,742 1,883 
Interest rate and economic contracts867,773 10,727 214,592 8,309 
Equity warrant assets16,816 3,557 17,008 3,689 
Total$884,589 $14,284 $231,600 $11,998 
Derivative Liabilities:
Interest rate contracts$165,127 $7,510 $468,850 $10,421 
Foreign exchange contracts47,646 99 45,742 128 
Total$212,773 $7,609 $514,592 $10,549 
For further information regarding our derivatives, see Note 1. Nature of Operations and Summary of Significant Accounting Policies of the Notes to Consolidated Financial Statements contained in "Item 8. Financial Statements and Supplementary Data" of the Form 10-K.