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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables)

9 Months Ended

Sep. 30, 2025

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Assets at Fair Value

As of September 30, 2025 and December 31, 2024, the following amounts were recorded on the consolidated balance sheet related to cumulative basis adjustments for fair value hedges:

						Amortized Cost												Cumulative Amount of Fair Value Hedging Adjustment to Hedged Items
(amounts in thousands)						September 30, 2025						December 31, 2024						September 30, 2025						December 31, 2024
AFS debt securities						$	—					$	10,000					$	—					$	—
Deposits						1,697,282						1,794,923						22,495						(6,042)
FHLB advances						750,000						1,200,000						5,437						(1,648)

Fair Value of Derivative Financial Instruments

The following tables present the fair value of Customers’ derivative financial instruments as well as their presentation on the consolidated balance sheets as of September 30, 2025 and December 31, 2024:

September 30, 2025

Derivative Assets

Derivative Liabilities

(amounts in thousands)

Balance Sheet Location

Fair Value

Balance Sheet Location

Fair Value

Interest rate swaps, caps and collars (1)

Other assets

$

12,613

Other liabilities

$

17,300

December 31, 2024

Derivative Assets

Derivative Liabilities

(amounts in thousands)

Balance Sheet Location

Fair Value

Balance Sheet Location

Fair Value

Derivatives not designated as hedging instruments:

Interest rate swaps and caps (1)

Other assets

$

15,223

Other liabilities

$

22,567

(1)    Customers’ centrally cleared derivatives are legally settled through variation margin payments and these payments are reflected as a reduction of the related derivative asset or liability, including accrued interest, on the consolidated balance sheet.

Effect of Derivative Financial Instruments on Net Income and Comprehensive Income

The following table presents amounts included in the consolidated statements of income related to derivatives designated as fair value hedges and derivatives not designated as hedges for the three and nine months ended September 30, 2025 and 2024:

									Amount of Income (Loss) Recognized in Earnings
									Three Months Ended September 30,												Nine Months Ended September 30,
(amounts in thousands)			Income Statement Location						2025						2024						2025						2024
Derivatives designated as fair value hedges:
Recognized on interest rate swaps			Net interest income						$	(2,245)					$	42,717					$	(6,535)					$	54,453
Recognized on hedged AFS debt securities			Net interest income						—						(306)						—						(739)
Recognized on hedged deposits			Net interest income						1,452						(23,444)						4,188						(25,130)
Recognized on hedged FHLB advances			Net interest income						944						(18,967)						2,834						(28,584)
Total									$	151					$	—					$	487					$	—
Derivatives not designated as hedging instruments:
Interest rate swaps, caps and collars			Other non-interest income						$	340					$	374					$	(2,011)					$	1,109

Changes in Accumulated Other Comprehensive Income (Loss)

The following table presents the changes in accumulated other comprehensive income (loss) by component for the three and nine months ended September 30, 2025 and 2024. Amounts in parentheses indicate reductions to AOCI:

															Three Months Ended September 30, 2025
(amounts in thousands)															Unrealized Gains (Losses) on Available for Sale Securities (1)						Unrealized Gains (Losses) on Cash Flow Hedges (2)						Total
Balance at July 1															$	(71,325)					$	—					$	(71,325)
Unrealized gains (losses) arising during period, before tax															22,929						2,286						25,215
Income tax effect															(6,066)						(605)						(6,671)
Other comprehensive income (loss) before reclassifications															16,863						1,681						18,544
Reclassification adjustments for (gains) losses included in net income, before tax															(186)						1,412						1,226
Income tax effect															49						(373)						(324)
Amounts reclassified from accumulated other comprehensive income (loss) to net income															(137)						1,039						902
Amortization of unrealized loss on securities transferred from available for sale to held to maturity															1,074						—						1,074
Income tax effect															(284)						—						(284)
Amortization of unrealized loss on securities transferred from available for sale to held to maturity															790						—						790
Net current-period other comprehensive income (loss)															17,516						2,720						20,236
Balance at September 30															$	(53,809)					$	2,720					$	(51,089)

															Three Months Ended September 30, 2024
(amounts in thousands)															Unrealized Gains (Losses) on Available for Sale Securities (1)						Unrealized Gains (Losses) on Cash Flow Hedges (2)						Total
Balance at July 1															$	(131,358)					$	—					$	(131,358)
Unrealized gains (losses) arising during period, before tax															32,810						—						32,810
Income tax effect															(8,432)						—						(8,432)
Other comprehensive income (loss) before reclassifications															24,378						—						24,378
Reclassification adjustments for (gains) losses included in net income, before tax															—						—						—
Income tax effect															—						—						—
Amounts reclassified from accumulated other comprehensive income (loss) to net income															—						—						—
Amortization of unrealized loss on securities transferred from available for sale to held to maturity															1,209						—						1,209
Income tax effect															(311)						—						(311)
Amortization of unrealized loss on securities transferred from available for sale to held to maturity															898						—						898
Net current-period other comprehensive income (loss)															25,276						—						25,276
Balance at September 30															$	(106,082)					$	—					$	(106,082)

									Nine Months Ended September 30, 2025
(amounts in thousands)									Unrealized Gains (Losses) Available for Sale Securities (1)						Unrealized Gains (Losses) on Cash Flow Hedges (2)												Total
Balance at January 1									$	(96,560)					$	—											$	(96,560)
Unrealized gains (losses) arising during period, before tax									1,669						2,286												3,955
Income tax effect									(463)						(605)												(1,068)
Other comprehensive income (loss) before reclassifications									1,206						1,681												2,887
Reclassification adjustments for (gains) losses included in net income, before tax									52,930						1,412												54,342
Income tax effect									(13,923)						(373)												(14,296)
Amounts reclassified from accumulated other comprehensive income (loss) to net income									39,007						1,039												40,046
Amortization of unrealized loss on securities transferred from available for sale to held to maturity									3,449						—												3,449
Income tax effect									(911)						—												(911)
Amortization of unrealized loss on securities transferred from available for sale to held to maturity									2,538						—												2,538
Net current-period other comprehensive income (loss)									42,751						2,720												45,471
Balance at September 30									$	(53,809)					$	2,720											$	(51,089)

									Nine Months Ended September 30, 2024
(amounts in thousands)									Unrealized Gains (Losses) on Available for Sale Securities (1)						Unrealized Gains (Losses) on Cash Flow Hedges (2)						Total
Balance at January 1									$	(136,569)					$	—					$	(136,569)
Unrealized gains (losses) arising during period, before tax									36,439						—						36,439
Income tax effect									(9,351)						—						(9,351)
Other comprehensive income (loss) before reclassifications									27,088						—						27,088
Reclassification adjustments for (gains) losses included in net income, before tax									749						—						749
Income tax effect									(193)						—						(193)
Amounts reclassified from accumulated other comprehensive income (loss) to net income									556						—						556
Amortization of unrealized loss on securities transferred from available for sale to held to maturity									3,821						—						3,821
Income tax effect									(978)						—						(978)
Amortization of unrealized loss on securities transferred from available for sale to held to maturity									2,843						—						2,843
Net current-period other comprehensive income									30,487						—						30,487
Balance at September 30									$	(106,082)					$	—					$	(106,082)

(1)    Reclassification amounts for AFS debt securities are reported as net gain (loss) on sale of investment securities or impairment loss on debt securities, and amortization of unrealized losses on debt securities transferred from available-for-sale to held-to-maturity is reported within interest income on the consolidated statements of income.

(2)    Reclassification amounts for cash flow hedges are reported as interest income for the applicable hedged items on the consolidated statements of income.

The following table presents the effect of Customers’ derivative financial instruments on comprehensive income for the three and nine months ended September 30, 2025 and 2024:

			Amount of Gain (Loss) Recognized in OCI on Derivatives (1)												Location of Gain (Loss) Reclassified from Accumulated OCI into Income						Amount of Gain (Loss) Reclassified from Accumulated OCI into Income
			Three Months Ended September 30,																		Three Months Ended September 30,
(amounts in thousands)			2025						2024												2025						2024
Derivatives in cash flow hedging relationships:
Interest rate swaps			$	1,681					$	—					Interest income						$	(1,412)					$	—

															Amount of Gain (Loss) Recognized in OCI on Derivatives (1)												Location of Gain (Loss) Reclassified from Accumulated OCI into Income																		Amount of Gain (Loss) Reclassified from Accumulated OCI into Income
															Nine Months Ended September 30,																														Nine Months Ended September 30,
(amounts in thousands)															2025						2024																								2025						2024
Derivatives in cash flow hedging relationships:
Interest rate swaps															$	1,681					$	—					Interest income																		$	(1,412)					$	—

(1)    Amounts presented are net of taxes. Refer to NOTE 5 – CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) for the total effect on other comprehensive income (loss) from derivatives designated as cash flow hedges for the periods presented.

Summary of Offsetting of Financial Assets and Derivative Assets

The following tables present derivative instruments that are subject to enforceable master netting arrangements. Customers’ interest rate swaps and interest rate caps with institutional counterparties are subject to master netting arrangements and are included in the tables below. Interest rate swaps, caps and collars with commercial banking customers are not subject to master netting arrangements and are excluded from the tables below. Customers has not made a policy election to offset its derivative positions.

			Gross Amounts Recognized on the Consolidated Balance Sheet																		Gross Amounts Not Offset in the Consolidated Balance Sheet												Net Amount
(amounts in thousands)									Financial Instruments						Cash Collateral Received/Posted
September 30, 2025
Interest rate derivative assets with institutional counterparties			$	7,079																	$	(5,814)					$	(1,265)					$	—
Interest rate derivative liabilities with institutional counterparties			$	5,814																	$	(5,814)					$	—					$	—

			Gross Amounts Recognized on the Consolidated Balance Sheet																		Gross Amounts Not Offset in the Consolidated Balance Sheet												Net Amount
(amounts in thousands)									Financial Instruments						Cash Collateral Received/Posted
December 31, 2024
Interest rate derivative assets with institutional counterparties			$	14,782																	$	(577)					$	(14,205)					$	—
Interest rate derivative liabilities with institutional counterparties			$	577																	$	(577)					$	—					$	—

Summary of Offsetting of Financial Liabilities and Derivative Liabilities

The following tables present derivative instruments that are subject to enforceable master netting arrangements. Customers’ interest rate swaps and interest rate caps with institutional counterparties are subject to master netting arrangements and are included in the tables below. Interest rate swaps, caps and collars with commercial banking customers are not subject to master netting arrangements and are excluded from the tables below. Customers has not made a policy election to offset its derivative positions.

			Gross Amounts Recognized on the Consolidated Balance Sheet																		Gross Amounts Not Offset in the Consolidated Balance Sheet												Net Amount
(amounts in thousands)									Financial Instruments						Cash Collateral Received/Posted
September 30, 2025
Interest rate derivative assets with institutional counterparties			$	7,079																	$	(5,814)					$	(1,265)					$	—
Interest rate derivative liabilities with institutional counterparties			$	5,814																	$	(5,814)					$	—					$	—

			Gross Amounts Recognized on the Consolidated Balance Sheet																		Gross Amounts Not Offset in the Consolidated Balance Sheet												Net Amount
(amounts in thousands)									Financial Instruments						Cash Collateral Received/Posted
December 31, 2024
Interest rate derivative assets with institutional counterparties			$	14,782																	$	(577)					$	(14,205)					$	—
Interest rate derivative liabilities with institutional counterparties			$	577																	$	(577)					$	—					$	—

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