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Disclosures About Fair Value of Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2023

Fair Value Disclosures [Abstract]

Estimated Fair Values of Financial Instruments

The estimated fair values of Customers' financial instruments at June 30, 2023 and December 31, 2022 were as follows:

															Fair Value Measurements at June 30, 2023
(amounts in thousands)			Carrying Amount						Estimated Fair Value						Quoted Prices in Active Markets for Identical Assets (Level 1)						Significant Other Observable Inputs (Level 2)						Significant Unobservable Inputs (Level 3)
Assets:
Cash and cash equivalents			$	3,155,224					$	3,155,224					$	3,155,224					$	—					$	—
Debt securities, available for sale			2,797,940						2,797,940						—						2,746,115						51,825
Debt securities, held to maturity			1,258,560						1,212,248						—						497,814						714,434
Loans held for sale			78,108						78,108						—						1,234						76,874
Total loans and leases receivable, net of allowance for credit losses on loans and leases			13,693,143						13,298,144						—						1,006,268						12,291,876
FHLB, Federal Reserve Bank, and other restricted stock			126,240						126,240						—						126,240						—
Derivatives			26,003						26,003						—						25,937						66
Liabilities:
Deposits			$	17,950,431					$	17,923,322					$	13,093,728					$	4,829,594					$	—
FHLB advances			2,046,142						2,029,664						—						2,029,664						—
Other borrowings			123,710						100,666						—						100,666						—
Subordinated debt			182,091						148,371						—						148,371						—
Derivatives			37,662						37,662						—						37,662						—

															Fair Value Measurements at December 31, 2022
(amounts in thousands)			Carrying Amount						Estimated Fair Value						Quoted Prices in Active Markets for Identical Assets (Level 1)						Significant Other Observable Inputs (Level 2)						Significant Unobservable Inputs (Level 3)
Assets:
Cash and cash equivalents			$	455,806					$	455,806					$	455,806					$	—					$	—
Debt securities, available for sale			2,961,015						2,961,015						—						2,887,749						73,266
Debt securities, held to maturity			840,259						793,813						—						437,680						356,133
Loans held for sale			328,312						328,312						—						322						327,990
Total loans and leases receivable, net of allowance for credit losses on loans and leases			15,335,435						14,890,823						—						1,323,312						13,567,511
FHLB, Federal Reserve Bank, and other restricted stock			74,196						74,196						—						74,196						—
Derivatives			44,435						44,435						—						44,380						55
Liabilities:
Deposits			$	18,156,953					$	18,127,338					$	13,907,087					$	4,220,251					$	—
FHLB advances			800,000						781,113						—						781,113						—
Other borrowings			123,580						108,081						—						108,081						—
Subordinated debt			181,952						168,441						—						168,441						—
Derivatives			42,106						42,106						—						42,106						—

Summary of Financial Assets and Liabilities Measured at Fair Value on a Recurring and Nonrecurring Basis

For financial assets and liabilities measured at fair value on a recurring and nonrecurring basis, the fair value measurements by level within the fair value hierarchy used at June 30, 2023 and December 31, 2022 were as follows:

			June 30, 2023
			Fair Value Measurements at the End of the Reporting Period Using
(amounts in thousands)			Quoted Prices in Active Markets for Identical Assets (Level 1)						Significant Other Observable Inputs (Level 2)						Significant Unobservable Inputs (Level 3)						Total
Measured at Fair Value on a Recurring Basis:
Assets
Available for sale debt securities:
Asset-backed securities			$	—					$	74,712					$	51,825					$	126,537
Agency-guaranteed residential collateralized mortgage obligations			—						125,308						—						125,308
Collateralized loan obligations			—						831,253						—						831,253
Commercial mortgage-backed securities			—						132,474						—						132,474
Corporate notes			—						579,751						—						579,751
Private label collateralized mortgage obligations			—						1,002,617						—						1,002,617
Derivatives			—						25,937						66						26,003
Loans held for sale – fair value option			—						1,234						—						1,234
Loans receivable, mortgage warehouse – fair value option			—						1,006,268						—						1,006,268
Total assets – recurring fair value measurements			$	—					$	3,779,554					$	51,891					$	3,831,445
Liabilities
Derivatives			$	—					$	37,662					$	—					$	37,662
Measured at Fair Value on a Nonrecurring Basis:
Assets
Collateral-dependent loans			$	—					$	—					$	2,375					$	2,375
Total assets – nonrecurring fair value measurements			$	—					$	—					$	2,375					$	2,375

			December 31, 2022
			Fair Value Measurements at the End of the Reporting Period Using
(amounts in thousands)			Quoted Prices in Active Markets for Identical Assets (Level 1)						Significant Other Observable Inputs (Level 2)						Significant Unobservable Inputs (Level 3)						Total
Measured at Fair Value on a Recurring Basis:
Assets
Available for sale debt securities:
Asset-backed securities			$	—					$	87,276					$	73,266					$	160,542
Agency-guaranteed residential collateralized mortgage obligations			—						133,864						—						133,864
Collateralized loan obligations			—						872,738						—						872,738
Commercial mortgage-backed securities			—						136,357						—						136,357
Corporate notes			—						595,253						—						595,253
Private label collateralized mortgage obligations			—						1,062,261						—						1,062,261
Derivatives			—						44,380						55						44,435
Loans held for sale – fair value option			—						322						—						322
Loans receivable, mortgage warehouse – fair value option			—						1,323,312						—						1,323,312
Total assets – recurring fair value measurements			$	—					$	4,255,763					$	73,321					$	4,329,084
Liabilities
Derivatives			$	—					$	42,106					$	—					$	42,106
Measured at Fair Value on a Nonrecurring Basis:
Assets
Collateral-dependent loans			$	—					$	—					$	4,819					$	4,819
Total assets – nonrecurring fair value measurements			$	—					$	—					$	4,819					$	4,819

Statement of Changes in Level 3 Assets Measured at Fair Value on a Recurring Basis

The changes in asset-backed securities (Level 3 assets) measured at fair value on a recurring basis for the three and six months ended June 30, 2023 and 2022 are summarized in the table below.

			Asset-backed securities
(amounts in thousands)			Three Months Ended June 30,
			2023						2022
Balance at April 1			$	63,376					$	121,853
Principal payments and premium amortization			(10,444)						(18,147)
Increase in allowance for credit losses			(773)						—
Decrease in allowance for credit losses			—						317
Change in fair value recognized in OCI			(334)						2,896
Balance at June 30			$	51,825					$	106,919

			Asset-backed securities
(amounts in thousands)			Six Months Ended June 30,
			2023						2022
Balance at January 1			$	73,266					$	142,885
Principal payments and premium amortization			(21,660)						(34,496)
Increase in allowance for credit losses			(1,046)						(411)
Decrease in allowance for credit losses			61						—
Change in fair value recognized in OCI			1,204						(1,059)
Balance at June 30			$	51,825					$	106,919

Summary of Financial Assets and Financial Liabilities Measured at Fair Value on Recurring and Nonrecurring Basis

The following tables summarize financial assets and financial liabilities measured at fair value as of June 30, 2023 and December 31, 2022 on a recurring and nonrecurring basis for which Customers utilized Level 3 inputs to measure fair value. The unobservable Level 3 inputs noted below contain a level of uncertainty that may differ from what is realized in an immediate settlement of the assets. Therefore, Customers may realize a value higher or lower than the current estimated fair value of the assets.

Quantitative Information about Level 3 Fair Value Measurements

(dollars in thousands)

Fair Value Estimate

Valuation Technique

Unobservable Input

Range  (Weighted Average)

June 30, 2023

Asset-backed securities

$

51,825

Discounted cash flow

Discount rate Annualized loss rate Constant prepayment rate

9% - 10% (10%) 3% - 6% (5%) 15% - 28% (25%)

Quantitative Information about Level 3 Fair Value Measurements

(dollars in thousands)

Fair Value Estimate

Valuation Technique

Unobservable Input

Range  (Weighted Average)

December 31, 2022

Asset-backed securities

$

73,266

Discounted cash flow

Discount rate Annualized loss rate Constant prepayment rate

9% - 9% (9%) 4% - 5% (5%) 19% - 25% (23%)

X

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

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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.

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