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FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 9 Months Ended
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Sep. 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:
| September 30, 2024 |
| Fair Value Measurements |
| Level 1 |  | Level 2 |  | Level 3 |  | Total |
| (In thousands) |
Recurring fair value measurements: |  |  |  |  |  |  |  |
Investment securities available-for-sale | $ | 1,136 |  |  | $ | 2,228,966 |  |  | $ | — |  |  | $ | 2,230,102 |  |
Trading securities | — |  |  | 18 |  |  | — |  |  | 18 |  |
Money market investments | 5,885 |  |  | — |  |  | — |  |  | 5,885 |  |
Servicing assets | — |  |  | — |  |  | 68,512 |  |  | 68,512 |  |
| $ | 7,021 |  |  | $ | 2,228,984 |  |  | $ | 68,512 |  |  | $ | 2,304,517 |  |
Non-recurring fair value measurements: |  |  |  |  |  |  |  |
Collateral dependent loans | $ | — |  |  | $ | — |  |  | $ | 8,583 |  |  | $ | 8,583 |  |
Foreclosed real estate | — |  |  | — |  |  | 4,419 |  |  | 4,419 |  |
Other repossessed assets | — |  |  | — |  |  | 6,969 |  |  | 6,969 |  |
Mortgage loans held for sale | — |  |  | — |  |  | 10,908 |  |  | 10,908 |  |
Other loans held for sale | — |  |  | — |  |  | 4,716 |  |  | 4,716 |  |
| $ | — |  |  | $ | — |  |  | $ | 35,595 |  |  | $ | 35,595 |  |
| 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 the quarters and nine-month periods ended September 30, 2024 and 2023: Level 3 Instruments Only
|  | Quarter Ended September 30, |  |  |  |  |  |
|  | 2024 |  | 2023 |  |  |  |  |  |
|  | Servicing Assets |  |  | Other debt securities available for sale | Servicing Assets | Total |  |  |  |  |  |
|  | (In thousands) |  |  |  |  |  |
Balance at beginning period |  | $ | 49,789 |  |  |  | $ | 413 |  | $ | 49,966 |  | $ | 50,379 |  |  |  |  |  |  |
New instruments acquired |  | 21,923 |  |  |  | — |  | 453 |  | 453 |  |  |  |  |  |  |
Principal repayments and amortization |  | (1,108) |  |  |  | — |  | (1,060) |  | (1,060) |  |  |  |  |  |  |
Instrument converted to equity security |  | — |  |  |  | (413) |  | — |  | (413) |  |  |  |  |  |  |
Gains (losses) included in earnings |  | (2,092) |  |  |  | — |  | 1,242 |  | 1,242 |  |  |  |  |  |  |
Balance at end of period |  | $ | 68,512 |  |  |  | $ | — |  | $ | 50,601 |  | $ | 50,601 |  |  |  |  |  |  |
|  | Nine-Month Period Ended September 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 |  | 22,753 |  |  |  | — |  | 1,818 |  | 1,818 |  |  |  |  |  |  |
Principal repayments and amortization |  | (2,759) |  |  |  | — |  | (3,210) |  | (3,210) |  |  |  |  |  |  |
Instrument converted to equity security |  | — |  |  |  | (406) |  | — |  | (406) |  |  |  |  |  |  |
Gains (losses) included in earnings |  | (1,002) |  |  |  | — |  | 1,072 |  | 1,072 |  |  |  |  |  |  |
Balance at end of period |  | $ | 68,512 |  |  |  | $ | — |  | $ | 50,601 |  | $ | 50,601 |  |  |  |  |  |  |
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 September 30, 2024 and December 31, 2023:
| September 30, 2024
| Fair Value |  | Valuation Technique |  | Unobservable Input |  | Range |  | Weighted Average
| (In thousands) |  |  |  |  |  |  |  |
Servicing assets | $ | 68,512 |  |  | Cash flow valuation |  | Constant prepayment rate |  | 0.85% - 13.30% |  | 6.25 | %
|  |  |  |  | Discount rate |  | 10.00% - 15.50% |  | 11.61 | %
Collateral dependent loans | $ | 8,583 |  |  | Fair value of property or collateral |  | Appraised value less disposition costs |  | 10.20% - 33.20% |  | 17.04 | %
Foreclosed real estate | $ | 4,419 |  |  | Fair value of property or collateral |  | Appraised value less disposition costs |  | 10.00% - 33.00% |  | 11.10 | %
Other repossessed assets | $ | 6,969 |  |  | Fair value of property or collateral |  | Estimated net realizable value less disposition costs |  | 37.00% - 71.00% |  | 56.32 | %
Mortgage loans held for sale | $ | 10,908 |  |  | Market prices |  | Pricing and execution whole loan |  | 94.06% - 102.10% |  | 98.56 | %
Other loans held for sale | $ | 4,716 |  |  | Bids or sales contract prices |  | Estimated market value |  | 99.75% - 101.21% |  | 101.12 | %
| 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 September 30, 2024 and December 31, 2023 was as follows:
| September 30, 2024 |  | December 31, 2023
| Fair Value |  | Carrying Value |  | Fair Value |  | Carrying Value |  |  |  |  |  |
| (In thousands) |  |  |  |  |  |
Financial Assets: |  |  |  |  |  |  |  |  |  |  |  |  |
Level 1 |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents | $ | 680,587 |  |  | $ | 680,587 |  |  | $ | 748,173 |  |  | $ | 748,173 |  |  |  |  |  |  |
Investment securities available-for-sale | $ | 1,136 |  |  | $ | 1,136 |  |  | $ | 296,799 |  |  | $ | 296,799 |  |  |  |  |  |  |
Level 2 |  |  |  |  |  |  |  |  |  |  |  |  |
Financial Assets: |  |  |  |  |  |  |  |  |  |  |  |  |
Trading securities | $ | 18 |  |  | $ | 18 |  |  | $ | 13 |  |  | $ | 13 |  |  |  |  |  |  |
Investment securities available-for-sale | $ | 2,228,966 |  |  | $ | 2,228,966 |  |  | $ | 1,802,465 |  |  | $ | 1,802,465 |  |  |  |  |  |  |
Investment securities held-to-maturity | $ | 249,198 |  |  | $ | 297,713 |  |  | $ | 455,709 |  |  | $ | 514,024 |  |  |  |  |  |  |
Federal Home Loan Bank (FHLB) stock | $ | 18,430 |  |  | $ | 18,430 |  |  | $ | 14,488 |  |  | $ | 14,488 |  |  |  |  |  |  |
Equity securities | $ | 27,262 |  |  | $ | 27,262 |  |  | $ | 23,981 |  |  | $ | 23,981 |  |  |  |  |  |  |
Level 3 |  |  |  |  |  |  |  |  |  |  |  |  |
Financial Assets: |  |  |  |  |  |  |  |  |  |  |  |  |
Investment securities held-to-maturity | $ | 35,051 |  |  | $ | 35,000 |  |  | $ | 35,055 |  |  | $ | 35,000 |  |  |  |  |  |  |
Total loans (including loans held-for-sale) | $ | 7,516,112 |  |  | $ | 7,604,700 |  |  | $ | 7,282,214 |  |  | $ | 7,401,618 |  |  |  |  |  |  |
Accrued interest receivable | $ | 70,367 |  |  | $ | 70,367 |  |  | $ | 71,400 |  |  | $ | 71,400 |  |  |  |  |  |  |
Servicing assets | $ | 68,512 |  |  | $ | 68,512 |  |  | $ | 49,520 |  |  | $ | 49,520 |  |  |  |  |  |  |
Accounts receivable and other assets | $ | 62,052 |  |  | $ | 62,052 |  |  | $ | 47,859 |  |  | $ | 47,589 |  |  |  |  |  |  |
Financial Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |
Deposits | $ | 9,651,703 |  |  | $ | 9,608,652 |  |  | $ | 9,767,068 |  |  | $ | 9,762,169 |  |  |  |  |  |  |
Advances from FHLB | $ | 270,045 |  |  | $ | 270,827 |  |  | $ | 199,184 |  |  | $ | 200,768 |  |  |  |  |  |  |
Other borrowings | $ | — |  |  | $ | — |  |  | $ | 2 |  |  | $ | 2 |  |  |  |  |  |  |
Accrued expenses and other liabilities | $ | 157,609 |  |  | $ | 157,609 |  |  | $ | 115,985 |  |  | $ | 115,985 |  |  |  |  |  |  |

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