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FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 6 Months Ended
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Jun. 30, 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:
| June 30, 2024 |
| Fair Value Measurements |
| Level 1 |  | Level 2 |  | Level 3 |  | Total |
| (In thousands) |
Recurring fair value measurements: |  |  |  |  |  |  |  |
Investment securities available-for-sale | $ | 200,658 |  |  | $ | 1,895,648 |  |  | $ | — |  |  | $ | 2,096,306 |  |
Trading securities | — |  |  | 16 |  |  | — |  |  | 16 |  |
Money market investments | 5,083 |  |  | — |  |  | — |  |  | 5,083 |  |
Servicing assets | — |  |  | — |  |  | 49,789 |  |  | 49,789 |  |
| $ | 205,741 |  |  | $ | 1,895,664 |  |  | $ | 49,789 |  |  | $ | 2,151,194 |  |
Non-recurring fair value measurements: |  |  |  |  |  |  |  |
Collateral dependent loans | $ | — |  |  | $ | — |  |  | $ | 13,772 |  |  | $ | 13,772 |  |
Foreclosed real estate | — |  |  | — |  |  | 6,526 |  |  | 6,526 |  |
Other repossessed assets | — |  |  | — |  |  | 5,713 |  |  | 5,713 |  |
Mortgage loans held for sale | — |  |  | — |  |  | 8,375 |  |  | 8,375 |  |
Other loans held for sale | — |  |  | — |  |  | 12,361 |  |  | 12,361 |  |
| $ | — |  |  | $ | — |  |  | $ | 46,747 |  |  | $ | 46,747 |  |
| 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 June 30, 2024 and 2023: Level 3 Instruments Only
|  | Quarter Ended June 30, |  |  |  |  |  |
|  | 2024 |  | 2023 |  |  |  |  |  |
|  | Servicing Assets |  |  | Other debt securities available for sale | Servicing Assets | Total |  |  |  |  |  |
|  | (In thousands) |  |  |  |  |  |
Balance at beginning period |  | $ | 49,553 |  |  |  | $ | 413 |  | $ | 49,345 |  | $ | 49,758 |  |  |  |  |  |  |
New instruments acquired |  | 303 |  |  |  | — |  | 791 |  | 791 |  |  |  |  |  |  |
Principal repayments and amortization |  | (732) |  |  |  | — |  | (1,085) |  | (1,085) |  |  |  |  |  |  |
Gains included in earnings |  | 665 |  |  |  | — |  | 915 |  | 915 |  |  |  |  |  |  |
Gains included in other comprehensive income |  | — |  |  |  | 7 |  | — |  | 7 |  |  |  |  |  |  |
Balance at end of period |  | $ | 49,789 |  |  |  | $ | 420 |  | $ | 49,966 |  | $ | 50,386 |  |  |  |  |  |  |
|  | Six-Month Period Ended June 30, |  |  |  |  |  |
|  | 2024 |  | 2023 |  |  |  |
|  | Servicing Assets |  |  | Other debt securities available for sale | Servicing Assets | Total |  |  |  |  |  |
|  | (In thousands) |  |  |
Balance at beginning of period |  | $ | 49,520 |  |  |  | $ | 406 |  | $ | 50,921 |  | $ | 51,327 |  |  |  |  |  |  |
New instruments acquired |  | 830 |  |  |  | — |  | 1,365 |  | 1,365 |  |  |  |  |  |  |
Principal repayments and amortization |  | (1,652) |  |  |  | — |  | (2,150) |  | (2,150) |  |  |  |  |  |  |
Gains included in earnings |  | 1,091 |  |  |  | — |  | (170) |  | (170) |  |  |  |  |  |  |
Gains included in other comprehensive income |  | — |  |  |  | 14 |  | — |  | 14 |  |  |  |  |  |  |
Balance at end of period |  | $ | 49,789 |  |  |  | $ | 420 |  | $ | 49,966 |  | $ | 50,386 |  |  |  |  |  |  |
Schedule of Qualitative Information for Assets and Liabilities | The table below presents quantitative information for all assets measured at fair value on a recurring and non-recurring basis using significant unobservable inputs (Level 3) at June 30, 2024 and December 31, 2023:
| June 30, 2024
| Fair Value |  | Valuation Technique |  | Unobservable Input |  | Range |  | Weighted Average
| (In thousands) |  |  |  |  |  |  |  |
Servicing assets | $ | 49,789 |  |  | Cash flow valuation |  | Constant prepayment rate |  | 1.49% - 11.45% |  | 6.07 | %
|  |  |  |  | Discount rate |  | 10.00% - 15.50% |  | 11.45 | %
Collateral dependent loans | $ | 13,772 |  |  | Fair value of property or collateral |  | Appraised value less disposition costs |  | 10.20% - 33.20% |  | 17.67 | %
Foreclosed real estate | $ | 6,526 |  |  | Fair value of property or collateral |  | Appraised value less disposition costs |  | 10.00% - 33.00% |  | 10.95 | %
Other repossessed assets | $ | 5,713 |  |  | Fair value of property or collateral |  | Estimated net realizable value less disposition costs |  | 36.00% - 71.00% |  | 55.48 | %
Mortgage loans held for sale | $ | 8,375 |  |  | Market prices |  | Pricing and execution whole loan |  | 92.89% - 101.33% |  | 98.25 | %
Other loans held for sale | $ | 12,361 |  |  | Bids or sales contract prices |  | Estimated market value |  | 100.00% - 104.47% |  | 100.48 | %
| 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 June 30, 2024 and December 31, 2023 was as follows:
| June 30, 2024 |  | December 31, 2023
| Fair Value |  | Carrying Value |  | Fair Value |  | Carrying Value |  |  |  |  |  |
| (In thousands) |  |  |  |  |  |
Financial Assets: |  |  |  |  |  |  |  |  |  |  |  |  |
Level 1 |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents | $ | 740,429 |  |  | $ | 740,429 |  |  | $ | 748,173 |  |  | $ | 748,173 |  |  |  |  |  |  |
Investment securities available-for-sale | $ | 200,658 |  |  | $ | 200,658 |  |  | $ | 296,799 |  |  | $ | 296,799 |  |  |  |  |  |  |
Level 2 |  |  |  |  |  |  |  |  |  |  |  |  |
Financial Assets: |  |  |  |  |  |  |  |  |  |  |  |  |
Trading securities | $ | 16 |  |  | $ | 16 |  |  | $ | 13 |  |  | $ | 13 |  |  |  |  |  |  |
Investment securities available-for-sale | $ | 1,895,648 |  |  | $ | 1,895,648 |  |  | $ | 1,802,465 |  |  | $ | 1,802,465 |  |  |  |  |  |  |
Investment securities held-to-maturity | $ | 244,365 |  |  | $ | 303,621 |  |  | $ | 455,709 |  |  | $ | 514,024 |  |  |  |  |  |  |
Federal Home Loan Bank (FHLB) stock | $ | 15,280 |  |  | $ | 15,280 |  |  | $ | 14,488 |  |  | $ | 14,488 |  |  |  |  |  |  |
Equity securities | $ | 25,794 |  |  | $ | 25,794 |  |  | $ | 23,981 |  |  | $ | 23,981 |  |  |  |  |  |  |
Level 3 |  |  |  |  |  |  |  |  |  |  |  |  |
Financial Assets: |  |  |  |  |  |  |  |  |  |  |  |  |
Investment securities held-to-maturity | $ | 35,072 |  |  | $ | 35,000 |  |  | $ | 35,055 |  |  | $ | 35,000 |  |  |  |  |  |  |
Total loans (including loans held-for-sale) | $ | 7,410,349 |  |  | $ | 7,503,142 |  |  | $ | 7,282,214 |  |  | $ | 7,401,618 |  |  |  |  |  |  |
Accrued interest receivable | $ | 72,969 |  |  | $ | 72,969 |  |  | $ | 71,400 |  |  | $ | 71,400 |  |  |  |  |  |  |
Servicing assets | $ | 49,789 |  |  | $ | 49,789 |  |  | $ | 49,520 |  |  | $ | 49,520 |  |  |  |  |  |  |
Accounts receivable and other assets | $ | 56,760 |  |  | $ | 56,760 |  |  | $ | 47,859 |  |  | $ | 47,589 |  |  |  |  |  |  |
Financial Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |
Deposits | $ | 9,622,547 |  |  | $ | 9,605,250 |  |  | $ | 9,767,068 |  |  | $ | 9,762,169 |  |  |  |  |  |  |
Advances from FHLB | $ | 198,937 |  |  | $ | 200,741 |  |  | $ | 199,184 |  |  | $ | 200,768 |  |  |  |  |  |  |
Other borrowings | $ | — |  |  | $ | — |  |  | $ | 2 |  |  | $ | 2 |  |  |  |  |  |  |
Accrued expenses and other liabilities | $ | 140,410 |  |  | $ | 140,410 |  |  | $ | 115,985 |  |  | $ | 115,985 |  |  |  |  |  |  |

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