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DERIVATIVE FINANCIAL INSTRUMENTS (Tables)

3 Months Ended

Mar. 31, 2024

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of financial instruments owned and pledged as collateral

The principal balance of loans Busey has pledged as collateral to the FHLB and Federal Reserve Bank for liquidity as set forth in the table below (dollars in thousands):

			As of
			March 31, 2024						December 31, 2023
Pledged loans
FHLB			$	4,821,485					$	4,865,481
Federal Reserve Bank			724,971						722,914
Total pledged loans			$	5,546,456					$	5,588,395

To secure its obligations under derivative contracts, Busey pledged cash and held collateral as follows (dollars in thousands):

			As of
			March 31, 2024						December 31, 2023
Cash pledged to secure obligations under derivative contracts			$	34,210					$	34,210
Collateral held to secure obligations under derivative contracts			24,860						19,280

Summary of the interest-rate swaps designated as cash flow hedges

A summary of the interest-rate swaps designated as cash flow hedges is presented below (dollars in thousands):

									As of
			Location						March 31, 2024						December 31, 2023
Debt Swap
Notional amount									$	50,000					$	50,000
Weighted average fixed pay rates									1.79		%				1.79		%
Weighted average variable 3-month Fallback Rate (SOFR) receive rates									5.62		%				5.61		%
Weighted average maturity									0.46 years						0.71 years
Prime Loan Swap
Notional amount									$	300,000					$	300,000
Weighted average fixed receive rates									4.81		%				4.81		%
Weighted average variable Prime pay rates									8.50		%				8.50		%
Weighted average maturity									4.85 years						5.10 years
SOFR Loan Swap
Notional amount									$	100,000					$	—
Weighted average fixed receive rates									3.72		%				—
Weighted average maturity									4.93 years						—
Gross aggregate fair value of the swaps
Gross aggregate fair value of swap assets			Other assets						$	1,178					$	1,293
Gross aggregate fair value of swap liabilities			Other liabilities						30,303						25,411
Balances carried in AOCI
Unrealized gains (losses) on cash flow hedges, net of tax			AOCI						$	(20,272)					$	(16,694)

Reclassification of unrealized gains and losses from OCI

Busey expects to reclassify unrealized gains and losses from OCI to interest income and interest expense as shown in the following table, during the next 12 months (dollars in thousands). Amounts actually recognized could differ from these expectations due to changes in interest rates, hedge de-designations, and the addition of other hedges subsequent to March 31, 2024.

			As of March 31, 2024
Unrealized gains (losses) in OCI expected to be recognized in income
Unrealized losses expected to be reclassified from OCI to interest income			$	(952)
Unrealized gains expected to be reclassified from OCI to interest expense			483
Net unrealized gains (losses) in OCI expected to be recognized in net interest income			$	(469)

Schedule of interest income (expense) recorded on swap transactions

Interest expense recorded on these swap transactions was as follows for the periods presented (dollars in thousands):

									Three Months Ended March 31,
															2024						2023
Interest on swap transactions
Increase (decrease) in interest income on swap transactions															$	(2,796)					$	(2,192)
(Increase) decrease in interest expense on swap transactions															483						383
Net increase (decrease) in net interest income on swap transactions															$	(2,313)					$	(1,809)

Summary of Net gains (losses) relating to these derivative instruments

The following table reflects the net gains (losses) relating to cash flow derivative instruments that were recorded in AOCI and the Consolidated Statements of Income (Unaudited) during the periods presented (dollars in thousands):

									Three Months Ended March 31,
															2024						2023
Unrealized gains (losses) on cash flow hedges
Net gain (loss) recognized in OCI, net of tax															$	(5,232)					$	3,050
(Gain) loss reclassified from OCI to interest income, net of tax															1,999						1,567
(Gain) loss reclassified from OCI to interest expense, net of tax															(345)						(274)
Net change in unrealized gains (losses) on cash flow hedges, net of tax															$	(3,578)					$	4,343

Changes in fair value of these derivative assets and liabilities were recorded in noninterest expense in the Consolidated Statements of Income (Unaudited) and are summarized as follows (dollars in thousands):

															Three Months Ended March 31,
			Location																		2024						2023
Interest rate swaps
Pay floating, receive fixed			Noninterest expense																		$	5,480					$	(7,667)
Pay fixed, receive floating			Noninterest expense																		(5,480)						7,667
Net change in fair value of interest rate swaps																					$	—					$	—

Gains (losses) relating to these derivative instruments are summarized as follows for the periods presented (dollars in thousands):

															Three Months Ended March 31,
			Location																		2024						2023
Gains (losses)
Interest rate lock commitments			Mortgage revenue																		$	267					$	37
Forward sales commitments			Mortgage revenue																		9						(54)
Interest rate lock commitments			Other expense																		5						—
Forward sales commitments			Other expense																		51						—

Summary of fair values of derivative assets and liabilities recorded in consolidated balance sheet

Amounts and fair values of derivative assets and liabilities related to customer interest rate swaps recorded in the Consolidated Balance Sheets (Unaudited) are summarized as follows (dollars in thousands):

			As of March 31, 2024
			Derivative Asset												Derivative Liability
			Notional Amount						Fair Value						Notional Amount						Fair Value
Derivatives not designated as hedging instruments
Interest rate swaps – pay floating, receive fixed			$	71,472					$	868					$	606,862					$	33,552
Interest rate swaps – pay fixed, receive floating			606,862						33,552						71,472						868
Total derivatives not designated as hedging instruments			$	678,334					$	34,420					$	678,334					$	34,420

			As of December 31, 2023
			Derivative Asset												Derivative Liability
			Notional Amount						Fair Value						Notional Amount						Fair Value
Derivatives not designated as hedging instruments
Interest rate swaps – pay floating, receive fixed			$	177,883					$	2,375					$	485,253					$	26,289
Interest rate swaps – pay fixed, receive floating			485,253						26,289						177,883						2,375
Total derivatives not designated as hedging instruments			$	663,136					$	28,664					$	663,136					$	28,664

Amounts and fair values of mortgage banking derivatives included in the Consolidated Balance Sheets (Unaudited) are summarized as follows (dollars in thousands):

									As of March 31, 2024												As of December 31, 2023
			Location						Notional Amount						Fair Value						Notional Amount						Fair Value
Mortgage banking derivative assets
Interest rate lock commitments			Other assets						$	9,123					$	133					$	3,477					$	25
Forward sales commitments			Other assets						2,772						9						1,761						11
Mortgage banking derivative assets									$	11,895					$	142					$	5,238					$	36
Mortgage banking derivative liabilities
Interest rate lock commitments			Other liabilities						$	268					$	3					$	1,615					$	10
Forward sales commitments			Other liabilities						6,619						51						5,216						47
Mortgage banking derivative liabilities									$	6,887					$	54					$	6,831					$	57

Schedule of notional amount and fair value of risk participation agreement

The risk participation agreements mature between June 2024 and January 2029, and are summarized as follows (dollars in thousands):

			As of
			March 31, 2024						December 31, 2023
Risk participation agreements purchased
Number of risk participation agreements			4						3
Notional amount			$	35,097					$	34,251
Fair value			9						15
Risk participation agreements sold
Number of risk participation agreements			1						1
Notional amount			$	20,001					20,001
Fair value			—						—

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