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DERIVATIVE FINANCIAL INSTRUMENTS | 9 Months Ended
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Sep. 30, 2025
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
DERIVATIVE FINANCIAL INSTRUMENTS | DERIVATIVE FINANCIAL INSTRUMENTS Non-designated Hedges Derivatives not designated as hedges are not used for speculative purposes. Instead, they arise from services provided to commercial banking customers as part of their risk management strategies. The Corporation executes interest rate swaps with commercial banking customers to facilitate their respective risk management strategies. Those interest rate swaps are simultaneously hedged by offsetting interest rate swaps that the Corporation executes with a third party, such that the Corporation minimizes its net risk exposure resulting from such transactions. As the interest rate swaps associated with this program do not meet the strict hedge accounting requirements, changes in the fair value of both the customer swaps and the offsetting swaps are recognized directly in earnings. Interest rate lock commitments related to mortgage loans and forward sale commitments to third-party investors are also considered derivatives. It is the Corporation's practice to enter into forward commitments for the future delivery of residential mortgage loans when interest rate lock commitments are entered into in order to economically hedge the effect of changes in interest rates resulting from its commitments to fund the loans. These mortgage banking derivatives are not designated in hedge relationships. Fair values were estimated using observable market inputs, primarily changes in mortgage interest rates, from the date of the commitment to the reporting date. Changes in the fair value of these mortgage banking derivatives are included in net gains and fees on sales of loans. The table below presents the fair value of the Corporation’s non-designated hedges, as well as their classification on the Consolidated Condensed Balance Sheets, as of September 30, 2025 and December 31, 2024.
| September 30, 2025 |  | December 31, 2024
| Notional Amount |  | Fair Value |  | Notional Amount |  | Fair Value
Included in other assets: |  |  |  |  |  |  |
Interest rate swaps | $ | 1,456,442 |  |  | $ | 49,673 |  |  | $ | 1,386,757 |  |  | $ | 76,528 |
Forward contracts related to mortgage loans to be delivered for sale | 50,872 |  | 800 |  | 39,142 |  | 465
Interest rate lock commitments | 36,909 |  | 249 |  | 15,000 |  | 140
Included in other assets | $ | 1,544,223 |  |  | $ | 50,722 |  |  | $ | 1,440,899 |  |  | $ | 77,133 |
Included in other liabilities: |  |  |  |  |  |  |
Interest rate swaps | $ | 1,583,830 |  |  | $ | 49,719 |  |  | $ | 1,486,764 |  |  | $ | 76,450 |
Forward contracts related to mortgage loans to be delivered for sale | 28,559 |  | 87 |  | 13,020 |  | 18
Interest rate lock commitments | 7,220 |  | 57 |  | 14,457 |  | 100
Included in other liabilities | $ | 1,619,609 |  |  | $ | 49,863 |  |  | $ | 1,514,241 |  |  | $ | 76,568 |
In the normal course of business, the Corporation may decide to settle a forward contract rather than fulfill the contract. Cash received or paid in this settlement manner is included in "Net gains and fees on sales of loans" in the Consolidated Condensed Statements of Income and is considered a cost of executing a forward contract. The amount of gain (loss) recognized into income related to non-designated hedging instruments is included in the table below for the periods indicated.
Derivatives Not Designated as Hedging Instruments under FASB ASC 815-10 |  | Location of Gain (Loss) Recognized Income on Derivative |  | Amount of Gain (Loss) Recognized into Income on Derivatives
|  | Three Months Ended September 30, 2025 |  | Three Months Ended September 30, 2024
Forward contracts related to mortgage loans to be delivered for sale |  | Net gains and fees on sales of loans |  | $ | (616) |  |  | $ | (966) |
Interest rate lock commitments |  | Net gains and fees on sales of loans |  | (68) |  |  | 30 |
Total net gain (loss) recognized in income |  |  |  | $ | (684) |  |  | $ | (936) |
Derivatives Not Designated as Hedging Instruments under FASB ASC 815-10 |  | Location of Gain (Loss) Recognized Income on Derivative |  | Amount of Gain (Loss) Recognized into Income on Derivatives
|  | Nine Months Ended September 30, 2025 |  | Nine Months Ended September 30, 2024
Forward contracts related to mortgage loans to be delivered for sale |  | Net gains and fees on sales of loans |  | $ | (542) |  |  | $ | (573) |
Interest rate lock commitments |  | Net gains and fees on sales of loans |  | 151 |  |  | (15) |
Total net gain (loss) recognized in income |  |  |  | $ | (391) |  |  | $ | (588) |
The Corporation’s exposure to credit risk occurs because of nonperformance by its counterparties. The counterparties approved by the Corporation are usually financial institutions, which are well capitalized and have credit ratings through Moody’s and/or Standard & Poor’s at or above investment grade. The Corporation’s mitigation of such risk is through quarterly financial reviews, comparing mark-to-market values with policy limitations, credit ratings and collateral pledging. Credit-risk-related Contingent Features The Corporation has agreements with certain of its derivative counterparties that contain a provision where if the Corporation fails to maintain its status as a well or adequately capitalized institution, then the Corporation could be required to terminate or fully collateralize all outstanding derivative contracts. Additionally, the Corporation has agreements with certain of its derivative counterparties that contain a provision where if the Corporation defaults on any of its indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, then the Corporation could also be declared in default on its derivative obligations. As of September 30, 2025, the termination value of derivatives in a net liability position related to these agreements was $10.1 million, which resulted in $1.1 million of collateral pledged to counterparties as of September 30, 2025. While the Corporation did not breach any of these provisions as of September 30, 2025, if it had, the Corporation could have been required to settle its obligations under the agreements at their termination value.

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