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DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 6 Months Ended
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Jun. 30, 2023
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Schedule of Interest Rate Swap Agreements and Non-Hedging Derivative Assets and Liabilities | Information about derivative assets and liabilities at June 30, 2023, follows:
|  |  | Weighted |  | Weighted Average Rate |  | Estimated
| Notional |  | Average |  |  |  | Contract |  | Fair Value
| Amount |  | Maturity |  | Received |  | pay rate |  | Asset (Liability)
| (In thousands) |  | (In years) |  |  |  |  |  | (In thousands)
Cash flow hedges: |  |  |  |  |  |  |  |  |
Interest rate swaps on commercial loans (1) | $ | 600,000 |  |  | 2.4 |  | 5.07 | % |  | 3.64 | % |  | $ | 714 |
Interest rate collars on commercial loans | 200,000 |  |  | 3.0 |  |  |  |  |  | 781 |
Total cash flow hedges | 800,000 |  |  |  |  |  |  |  |  | 1,495 |
Economic hedges: |  |  |  |  |  |  |  |  |
Interest rate swap on tax advantaged economic development bond | $ | 6,637 |  |  | 6.4 |  | 4.55 | % |  | 5.09 | % |  | $ | (118) |
Interest rate swaps on loans with commercial loan customers | 1,683,400 |  |  | 5.3 |  | 4.16 | % |  | 6.28 | % |  | (92,320) |
Offsetting interest rate swaps on loans with commercial loan customers (1) | 1,683,400 |  |  | 5.3 |  | 6.28 | % |  | 4.16 | % |  | 49,004 |
Risk participation agreements with dealer banks | 348,136 |  |  | 4.1 |  |  |  |  |  | (81) |
Forward sale commitments | 8,876 |  |  | 0.2 |  |  |  |  |  | 63 |
Total economic hedges | 3,730,449 |  |  |  |  |  |  |  |  | (43,452) |
Non-hedging derivatives: |  |  |  |  |  |  |  |  |
Commitments to lend | 9,369 |  |  | 0.2 |  |  |  |  |  | 37 |
Total non-hedging derivatives | 9,369 |  |  |  |  |  |  |  |  | 37 |
Total | $ | 4,539,818 |  |  |  |  |  |  |  |  | $ | (41,920) |
(1) Fair value estimates include the impact of $31.0 million settled to market contract agreements. Information about derivative assets and liabilities at December 31, 2022, follows:
|  |  | Weighted |  | Weighted Average Rate |  | Estimated
| Notional |  | Average |  |  |  | Contract |  | Fair Value
| Amount |  | Maturity |  | Received |  | pay rate |  | Asset (Liability)
| (In thousands) |  | (In years) |  |  |  |  |  | (In thousands)
Cash flow hedges: |  |  |  |  |  |  |  |  |
Interest rate swaps on commercial loans | $ | 400,000 |  |  | 2.7 |  | 4.09 | % |  | 3.51 | % |  | $ | — |
Forward-starting interest rate swaps on commercial loans | 200,000 |  |  | 3.3 |  | — | % |  | 3.90 | % |  | — |
Interest rate collars on commercial loans | 200,000 |  |  | 3.5 |  |  |  |  |  | 1,937 |
| 800,000 |  |  |  |  |  |  |  |  | 1,937 |
Economic hedges: |  |  |  |  |  |  |  |  |
Interest rate swap on tax advantaged economic development bond | $ | 7,062 |  |  | 6.9 |  | 4.49 | % |  | 5.09 | % |  | $ | (193) |
Interest rate swaps on loans with commercial loan customers | 1,685,263 |  |  | 5.7 |  | 4.11 | % |  | 5.55 | % |  | (95,114) |
Offsetting interest rate swaps on loans with commercial loan customers (1) | 1,685,263 |  |  | 5.7 |  | 5.55 | % |  | 4.11 | % |  | 50,267 |
Risk participation agreements with dealer banks | 341,885 |  |  | 6.6 |  |  |  |  |  | (89) |
Forward sale commitments | 927 |  |  | 0.2 |  |  |  |  |  | 8 |
Total economic hedges | 3,720,400 |  |  |  |  |  |  |  |  | (45,121) |
Non-hedging derivatives: |  |  |  |  |  |  |  |  |
Commitments to lend | 4,114 |  |  | 0.2 |  |  |  |  |  | 17 |
Total non-hedging derivatives | 4,114 |  |  |  |  |  |  |  |  | 17 |
Total | $ | 4,524,514 |  |  |  |  |  |  |  |  | $ | (43,167) |
(1) Fair value estimates include the impact of $38.3 million settled to market contract agreements.
Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) | Amounts included in the Consolidated Statements of Income and in the other comprehensive income section of the Consolidated Statements of Comprehensive Income (related to interest rate derivatives designated as hedges of cash flows), were as follows:
| Three Months Ended June 30, |  | Six Months Ended June 30,
(In thousands) | 2023 |  | 2022 |  | 2023 |  | 2022
Interest rate swaps on commercial loans: |  |  |  |  |  |  |
Unrealized (loss) recognized in accumulated other comprehensive loss | $ | (11,753) |  |  | $ | — |  |  | $ | (5,798) |  |  | $ | — |
Less: Reclassification of unrealized (loss) from accumulated other comprehensive loss to interest expense | (157) |  |  | — |  |  | (314) |  |  | — |
Net tax benefit on items recognized in accumulated other comprehensive income | 3,197 |  |  | — |  |  | 1,641 |  |  | — |
Other comprehensive loss recorded in accumulated other comprehensive income, net of reclassification adjustments and tax effects | $ | (8,713) |  |  | $ | — |  |  | $ | (4,471) |  |  | $ | — |
Net interest expense recognized on hedged commercial loans | $ | 2,034 |  |  | $ | — |  |  | $ | 3,327 |  |  | $ | — |
Schedule of Amounts Included in the Consolidated Statements of Income Related to Economic Hedges and Non-Hedging Derivatives | Amounts included in the Consolidated Statements of Income related to economic hedges and non-hedging derivatives were as follows:
| Three Months Ended June 30, |  | Six Months Ended June 30,
(In thousands) | 2023 |  | 2022 |  | 2023 |  | 2022
Economic hedges |  |  |  |  |  |  |
Interest rate swap on industrial revenue bond: |  |  |  |  |  |  |
Unrealized gain recognized in other non-interest income | $ | 142 |  |  | $ | 217 |  |  | $ | 75 |  |  | $ | 649 |
Interest rate swaps on loans with commercial loan customers: |  |  |  |  |  |  |
Unrealized (loss)/gain recognized in other non-interest income | (24,230) |  |  | (44,927) |  |  | 2,794 |  |  | (123,625) |
Favorable change in credit valuation adjustment recognized in other non-interest income | — |  |  | — |  |  | — |  |  | 1,809 |
Offsetting interest rate swaps on loans with commercial loan customers: |  |  |  |  |  |  |
Unrealized gain/(loss) recognized in other non-interest income | 24,230 |  |  | 44,927 |  |  | (2,794) |  |  | 123,625 |
Risk participation agreements: |  |  |  |  |  |  |
Unrealized gain/(loss) recognized in other non-interest income | 25 |  |  | (292) |  |  | 8 |  |  | (400) |
Forward commitments: |  |  |  |  |  |  |
Unrealized gain/(loss) recognized in other non-interest income | 48 |  |  | 11 |  |  | 55 |  |  | (116) |
Non-hedging derivatives |  |  |  |  |  |  |
Commitments to lend |  |  |  |  |  |  |
Unrealized gain/(loss) recognized in other non-interest income | $ | 11 |  |  | $ | 8 |  |  | $ | 20 |  |  | $ | (98) |
Realized gain in other non-interest income | 54 |  |  | 90 |  |  | 94 |  |  | 342 |
Schedule of Assets Subject to an Enforceable Master Netting Arrangement | Offsetting of Financial Assets and Derivative Assets
|  | Gross Amounts of |  | Gross Amounts Offset in the |  | Net Amounts of Assets Presented in the |  | Gross Amounts Not Offset in the Statements of Condition |  |
|  | Recognized |  | Statements of |  | Statements of |  | Financial |  | Cash |  |
(In thousands) |  | Assets |  | Condition |  | Condition |  | Instruments |  | Collateral Received |  | Net Amount
June 30, 2023 |  |  |  |  |  |  |  |  |  |  |  |
Interest Rate Swap Agreements: |  |  |  |  |  |  |  |  |  |  |  |
Institutional counterparties |  | $ | 93,842 |  |  | $ | (43,336) |  |  | $ | 50,506 |  |  | $ | — |  |  | $ | — |  |  | $ | 50,506 |
Commercial counterparties |  | 2,250 |  |  | — |  |  | 2,250 |  |  | — |  |  | — |  |  | 2,250 |
Total |  | $ | 96,092 |  |  | $ | (43,336) |  |  | $ | 52,756 |  |  | $ | — |  |  | $ | — |  |  | $ | 52,756 |
Offsetting of Financial Assets and Derivative Assets
|  | Gross Amounts of |  | Gross Amounts Offset in the |  | Net Amounts of Assets Presented in the |  | Gross Amounts Not Offset in the Statements of Condition |  |
|  | Recognized |  | Statements of |  | Statements of |  | Financial |  | Cash |  |
(In thousands) |  | Assets |  | Condition |  | Condition |  | Instruments |  | Collateral Received |  | Net Amount
December 31, 2022 |  |  |  |  |  |  |  |  |  |  |  |
Interest Rate Swap Agreements: |  |  |  |  |  |  |  |  |  |  |  |
Institutional counterparties |  | $ | 96,295 |  |  | $ | (45,046) |  |  | $ | 51,249 |  |  | $ | — |  |  | $ | — |  |  | $ | 51,249 |
Commercial counterparties |  | 975 |  |  | — |  |  | 975 |  |  | — |  |  | — |  |  | 975 |
Total |  | $ | 97,270 |  |  | $ | (45,046) |  |  | $ | 52,224 |  |  | $ | — |  |  | $ | — |  |  | $ | 52,224 |
Schedule of Liabilities Subject to an Enforceable Master Netting Arrangement | Offsetting of Financial Liabilities and Derivative Liabilities
|  | Gross Amounts of |  | Gross Amounts Offset in the |  | Net Amounts of Liabilities Presented in the |  | Gross Amounts Not Offset in the Statements of Condition |  |
|  | Recognized |  | Statements of |  | Statements of |  | Financial |  | Cash |  |
(In thousands) |  | Liabilities |  | Condition |  | Condition |  | Instruments |  | Collateral Pledged |  | Net Amount
June 30, 2023 |  |  |  |  |  |  |  |  |  |  |  |
Interest Rate Swap Agreements: |  |  |  |  |  |  |  |  |  |  |  |
Institutional counterparties |  | $ | (1,600) |  |  | $ | 5 |  |  | $ | (1,595) |  |  | $ | 9,918 |  |  | $ | — |  |  | $ | 8,323 |
Commercial counterparties |  | (105,357) |  |  | 12,294 |  |  | (93,063) |  |  | — |  |  | — |  |  | (93,063) |
Total |  | $ | (106,957) |  |  | $ | 12,299 |  |  | $ | (94,658) |  |  | $ | 9,918 |  |  | $ | — |  |  | $ | (84,740) |
Offsetting of Financial Liabilities and Derivative Liabilities
|  | Gross Amounts of |  | Gross Amounts Offset in the |  | Net Amounts of Liabilities Presented in the |  | Gross Amounts Not Offset in the Statements of Condition |  |
|  | Recognized |  | Statements of |  | Statements of |  | Financial |  | Cash |  |
(In thousands) |  | Liabilities |  | Condition |  | Condition |  | Instruments |  | Collateral Pledged |  | Net Amount
December 31, 2022 |  |  |  |  |  |  |  |  |  |  |  |
Interest Rate Swap Agreements: |  |  |  |  |  |  |  |  |  |  |  |
Institutional counterparties |  | $ | (1,271) |  |  | $ | 36 |  |  | $ | (1,235) |  |  | $ | 11,973 |  |  | $ | — |  |  | $ | 10,738 |
Commercial counterparties |  | (102,595) |  |  | 6,507 |  |  | (96,088) |  |  | — |  |  | — |  |  | (96,088) |
Total |  | $ | (103,866) |  |  | $ | 6,543 |  |  | $ | (97,323) |  |  | $ | 11,973 |  |  | $ | — |  |  | $ | (85,350) |

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