XML 61 R17.htm IDEA: XBRL DOCUMENT v3.25.3
DERIVATIVES AND HEDGING ACTIVITIES
 12 Months Ended
Sep. 30, 2025
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
DERIVATIVES AND HEDGING ACTIVITIES DERIVATIVES AND HEDGING ACTIVITIES
 The following tables present the fair value, notional amount and balance sheet classification of derivative assets and liabilities at
September 30, 2025 and September 30, 2024.
September 30, 2025
Derivative Assets
Derivative Liabilities
Interest rate contract purpose
Balance Sheet
Location
Notional
Fair Value
Balance Sheet
Location
Notional
Fair Value
(In thousands)
(In thousands)
Client swap program hedges
Other assets
$977,017
$37,347
Other liabilities
$977,017
$37,818
Commercial loan fair value hedges
Other assets
34,341
1,611
Other liabilities
—
—
Mortgage loan fair value hedges
Other assets
470,000
13,082
Other liabilities
1,100,000
20,426
Mortgage backed securities fair value hedges
Other assets
—
—
Other liabilities
610,000
15,086
Borrowings cash flow hedges
Other assets
900,000
99,231
Other liabilities
—
—
$2,381,358
$151,271
$2,687,017
$73,330
September 30, 2024
Derivative Assets
Derivative Liabilities
Interest rate contract purpose
Balance Sheet
Location
Notional
Fair Value
Balance Sheet
Location
Notional
Fair Value
(In thousands)
(In thousands)
Client swap program hedges
Other assets
$1,044,512
$46,758
Other liabilities
$1,044,512
$47,388
Commercial loan fair value hedges
Other assets
37,042
1,595
Other liabilities
—
—
Mortgage loan fair value hedges
Other assets
—
—
Other liabilities
2,570,000
667
Borrowings cash flow hedges
Other assets
900,000
117,271
Other liabilities
—
—
$1,981,554
$165,624
$3,614,512
$48,055
The Company enters into interest rate swaps to hedge interest rate risk. These arrangements include hedges of individual fixed rate
commercial loans and also hedges of a specified portion of pools of prepayable fixed rate mortgage loans under the "last of layer"
method. These relationships qualify as fair value hedges under FASB ASC 815, Derivatives and Hedging ("ASC 815"), which
provides for offsetting of the recognition of gains and losses of the respective interest rate swap and the hedged items. Gains and
losses on interest rate swaps designated in these hedge relationships, along with the offsetting gains and losses on the hedged items
attributable to the hedged risk, are recognized in current earnings within the same income statement line item. 
Upon electing to apply ASC 815 fair value hedge accounting, the carrying value of the hedged items are adjusted to reflect the
cumulative impact of changes in fair value attributable to the hedged risk. The hedge basis adjustment remains with each hedged
item until the hedged item is de-recognized from the balance sheet. The following tables present the impact of fair value hedge
accounting on the carrying value of the hedged items at September 30, 2025 and September 30, 2024.
(In thousands)
September 30, 2025
Balance sheet line item in which hedged item is recorded
Carrying value of hedged
items
Cumulative gain (loss) fair
value hedge adjustment
included in carrying amount of
hedged items
Loans receivable (1) (2)
$5,426,086
$6,794
Available-for-sale Securities (3)
940,110
15,452
$6,366,196
$22,246
(1) Includes the amortized cost basis of the closed mortgage loan portfolios used to designate the hedging relationships in
which the hedged items are the last layer expected to be remaining at the end of the hedging relationships. At September
30, 2025, the amortized cost basis of the closed loan portfolios used in the hedging relationships was $5,393,257,000, the
cumulative basis adjustment associated with the hedging relationships was $8,262,000, and the amount of the designated
hedged items was $1,570,000,000.  During the year, hedge accounting was discontinued on a $1,600,000,000 last of
layer hedge. A basis adjustment of $4,016,668 associated with the terminated portion of the hedge was deferred and is
being amortized over the remaining life of the associated pool of loans.
(2) Includes the amortized cost basis of commercial loans designated in fair value hedging relationships. At September
30, 2025, the amortized cost basis of the hedged commercial loans was $32,829,000 and the cumulative basis adjustment
associated with the hedging relationships was $(1,468,000).
(3) Includes the fair value basis of mortgage backed securities designated in fair value hedging relationships. At
September 30, 2025, the fair value of the hedged mortgage based securities was $940,110,000, the cumulative basis
adjustment associated with the hedging relationships was $15,452,000, and the amount of the designated hedged items
was $610,000,000. 
(In thousands)
September 30, 2024
Balance sheet line item in which hedged item is recorded
Carrying value of hedged
items
Cumulative gain (loss) fair
value hedge adjustment
included in carrying amount of
hedged items
Loans receivable (1) (2)
$7,287,540
$20,005
$7,287,540
$20,005
(1) Includes the amortized cost basis of the closed mortgage loan portfolios used to designate the hedging relationships in
which the hedged items are the last layer expected to be remaining at the end of the hedging relationships. At September
30, 2024, the amortized cost basis of the closed loan portfolios used in the hedging relationships was $7,252,017,000, the
cumulative basis adjustment associated with the hedging relationships was $21,476,000, and the amount of the
designated hedged items was $2,570,000,000. During the year, hedge accounting was discontinued on a $300,000,000
last of layer hedge. A basis adjustment of $1,232,211 associated with the terminated portion of the hedge was deferred
and is being accreted over the remaining life of the associated pool of loans.
(2) Includes the amortized cost basis of commercial loans designated in fair value hedging relationships. At September
30, 2024, the amortized cost basis of the hedged commercial loans was $35,523,000 and the cumulative basis adjustment
associated with the hedging relationships was $(1,471,000).
The Company has entered into interest rate swaps to convert certain short-term borrowings to fixed rate payments. The primary
purpose of these hedges is to mitigate the risk of changes in future cash flows resulting from increasing interest rates. For qualifying
cash flow hedges under ASC 815, gains and losses on the interest rate swaps are recorded in accumulated other comprehensive
income ("AOCI") and then reclassified into earnings in the same period the hedged cash flows affect earnings and within the same
income statement line item as the hedged cash flows. As of September 30, 2025, the maturities for hedges of adjustable rate
borrowings ranged from less than one year to five years, with the weighted average being 4.1 years.       
The following table presents the impact of derivative instruments (cash flow hedges on borrowings) on AOCI for the periods
presented.
(In thousands)
Twelve Months Ended September 30,
Amount of gain/(loss) recognized in AOCI on derivatives in cash flow hedging
relationships
2025
2024
Interest rate contracts:
Pay fixed/receive floating swaps on cash flow hedges of borrowings
$(18,040)
$(67,102)
Total pre-tax gain/(loss) recognized in AOCI
$(18,040)
$(67,102)
The following table presents the gains/(losses) on derivative instruments in fair value and cash flow accounting hedging
relationships under ASC 815 for the period presented.
Twelve Months Ended September 30, 2025
Twelve Months Ended September 30, 2024
Interest
income on
loans
receivable
Interest on
mortgage-
backed
securities
Interest
expense on
FHLB
advances
Interest
income on
loans
receivable
Interest on
mortgage-
backed
securities
Interest
expense on
FHLB
advances
(In thousands)
(In thousands)
Interest income/(expense), including the effects
of fair value and cash flow hedges
$1,119,937
$103,071
$(80,507)
$1,165,849
$59,782
$(178,444)
Gain/(loss) on fair value hedging relationships:
Interest rate contracts
Amounts related to interest settlements on
derivatives
$20,641
$962
$39,223
$—
Recognized on derivatives
2,222
(15,086)
(67,785)
—
Recognized on hedged items
(9,194)
15,452
67,639
—
Net income/(expense) recognized on fair
value hedges
$13,669
$1,328
$39,077
$—
Gain/(loss) on cash flow hedging relationships:
Interest rate contracts
Amounts related to interest settlements on
derivatives
$35,474
$46,645
Amount of derivative gain/(loss) reclassified
from AOCI into interest income/expense
—
—
Net income/(expense) recognized on cash
flow hedges
$35,474
$46,645
The Company periodically enters into certain interest rate swap agreements in order to provide commercial loan customers the
ability to convert from variable to fixed interest rate payments, while the Company retains a variable rate loan. Under these
agreements, the Company enters into a variable rate loan agreement and a swap agreement with the client. The swap agreement
effectively converts the client’s variable rate loan into a fixed rate. The Company enters into a corresponding swap agreement with a
third party in order to offset its exposure on the variable and fixed components of the client's swap agreement. The interest rate
swaps are derivatives under ASC 815, with changes in fair value recorded in earnings. The net impact to the statement of operations
for the year ended September 30, 2025 was an increase in other income of $159,000.  The net impact for the year ended September
30, 2024 was an increase in other income of $241,000. As of September 30, 2025, none of the outstanding notional balance is
associated with related party loans.
The following table presents the impact of derivative instruments (client swap program) that are not designated in accounting
hedges under ASC 815 for the periods presented.
(In thousands)
Twelve Months Ended September 30,
Derivative instruments
Classification of gain/(loss) recognized in
income on derivative instrument
2025
2024
Interest rate contracts:
Pay fixed/receive floating swap
Other noninterest income
$(2,836)
$(45,960)
Receive fixed/pay floating swap
Other noninterest income
2,995
46,201
$159
$241