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FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)

3 Months Ended

Mar. 31, 2024

Fair Value Disclosures [Abstract]

Schedule of Assets and Liabilities on Recurring and Non-Recurring Basis

Assets and liabilities measured at fair value on a recurring and non-recurring basis are summarized below:

			March 31, 2024
			Fair Value Measurements
			Level 1						Level 2						Level 3						Total
			(In thousands)
Recurring fair value measurements:
Investment securities available-for-sale			$	150,915					$	1,746,792					$	—					$	1,897,707
Trading securities			—						14						—						14
Money market investments			4,674						—						—						4,674
Servicing assets			—						—						49,553						49,553
			$	155,589					$	1,746,806					$	49,553					$	1,951,948
Non-recurring fair value measurements:
Collateral dependent loans			$	—					$	—					$	7,862					$	7,862
Foreclosed real estate			—						—						10,850						10,850
Other repossessed assets			—						—						6,844						6,844
Mortgage loans held for sale			—						—						9,370						9,370
Other loans held for sale			—						—						18,904						18,904
			$	—					$	—					$	53,830					$	53,830

			December 31, 2023
			Fair Value Measurements
			Level 1						Level 2						Level 3						Total
			(In thousands)
Recurring fair value measurements:
Investment securities available-for-sale			$	296,799					$	1,802,465					$	—					$	2,099,264
Trading securities			—						13						—						13
Money market investments			4,623						—						—						4,623
Servicing assets			—						—						49,520						49,520
			$	301,422					$	1,802,478					$	49,520					$	2,153,420
Non-recurring fair value measurements:
Collateral dependent loans			$	—					$	—					$	8,027					$	8,027
Foreclosed real estate			—						—						10,780						10,780
Other repossessed assets			—						—						4,032						4,032
Other loans held for sale			$	—					$	—					$	28,345					28,345
			$	—					$	—					$	51,184					$	51,184

Schedule of Reconciliation of Assets and Liabilities Using Significant Unobservable Inputs (Level 3)

The tables below present a reconciliation of all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for March 31, 2024 and 2023:

Level 3 Instruments Only

						Quarter Ended March 31,
						2024						2023
						Servicing Assets									Other debt securities available for sale			Servicing Assets			Total
						(In thousands)
Balance at beginning period						$	49,520								$	406		$	50,921		$	51,327
New instruments acquired						527									—			575			575
Principal repayments and amortization						(920)									—			(1,065)			(1,065)
Gains included in earnings						426									—			(1,086)			(1,086)
Gains included in other comprehensive income						—									7			—			7
Balance at end of period						$	49,553								$	413		$	49,345		$	49,758

Schedule of Qualitative Information for Assets and Liabilities

The table below presents quantitative information for all assets and liabilities measured at fair value on a recurring and non-recurring basis using significant unobservable inputs (Level 3) at March 31, 2024 and December 31, 2023:

			March 31, 2024
			Fair Value						Valuation Technique						Unobservable Input						Range						Weighted Average
			(In thousands)
Servicing assets			$	49,553					Cash flow valuation						Constant prepayment rate						1.14% - 15.08%						6.18		%
															Discount rate						10.00% - 15.50%						11.46		%
Collateral dependent loans			$	7,862					Fair value of property or collateral						Appraised value less disposition costs						10.20% - 33.20%						16.99		%
Foreclosed real estate			$	10,850					Fair value of property or collateral						Appraised value less disposition costs						10.20% - 33.20%						12.53		%
Other repossessed assets			$	6,844					Fair value of property or collateral						Estimated net realizable value less disposition costs						31.00% - 77.00%						56.43		%
Mortgage loans held for sale			$	9,370					Market prices						Pricing and execution whole loan						96.04% - 101.24%						98.25		%
Other loans held for sale			$	18,904					Bids or sales contract prices						Estimated market value						98.41% - 147.96%						129.96		%

			December 31, 2023
			Fair Value						Valuation Technique						Unobservable Input						Range						Weighted Average
			(In thousands)
Servicing assets			$	49,520					Cash flow valuation						Constant prepayment rate						1.35% - 17.34%						6.12		%
															Discount rate						10.00% - 15.50%						11.45		%
Collateral dependent loans			$	8,027					Fair value of property or collateral						Appraised value less disposition costs						10.20% - 33.20%						17.00		%
Foreclosed real estate			$	10,780					Fair value of property or collateral						Appraised value less disposition costs						10.20% - 33.20%						12.67		%
Other repossessed assets			$	4,032					Fair value of property or collateral						Estimated net realizable value less disposition costs						31.00% - 77.00%						57.72		%
Other loans held for sale			$	28,345					Bids or sales contract prices						Estimated market value						52.00% - 103.20%						84.80%

Schedule of Estimated Fair Value and Carrying Value

The estimated fair value and carrying value of OFG’s financial instruments at March 31, 2024 and December 31, 2023 was as follows:

			March 31, 2024												December 31, 2023
			Fair Value						Carrying Value						Fair Value						Carrying Value
			(In thousands)
Financial Assets:
Level 1
Cash and cash equivalents			$	754,392					$	754,392					$	748,173					$	748,173
Investment securities available-for-sale			$	150,915					$	150,915					$	296,799					$	296,799
Level 2
Financial Assets:
Trading securities			$	14					$	14					$	13					$	13
Investment securities available-for-sale			$	1,746,792					$	1,746,792					$	1,802,465					$	1,802,465
Investment securities held-to-maturity			$	448,603					$	509,491					$	455,709					$	514,024
Federal Home Loan Bank (FHLB) stock			$	14,488					$	14,488					$	14,488					$	14,488
Equity securities			$	25,674					$	25,674					$	23,981					$	23,981
Level 3
Financial Assets:
Investment securities held-to-maturity			$	35,054					$	35,000					$	35,055					$	35,000
Total loans (including loans held-for-sale)			$	7,296,452					$	7,411,378					$	7,282,214					$	7,401,618
Accrued interest receivable			$	72,117					$	72,117					$	71,400					$	71,400
Servicing assets			$	49,553					$	49,553					$	49,520					$	49,520
Accounts receivable and other assets			$	49,334					$	49,334					$	47,859					$	47,589
Financial Liabilities:
Deposits			$	9,581,054					$	9,548,274					$	9,767,068					$	9,762,169
Advances from FHLB			$	198,755					$	200,766					$	199,184					$	200,768
Other borrowings			$	—					$	—					$	2					$	2
Accrued expenses and other liabilities			$	121,871					$	121,871					$	115,985					$	115,985

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- 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 input and valuation technique used to measure fair value and change in valuation approach and technique for each separate class of asset and liability measured on recurring and nonrecurring basis.

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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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Tabular disclosure of the fair value of financial instruments, including financial assets and financial liabilities, and the measurements of those instruments, assets, and liabilities.

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