XML 48 R32.htm IDEA: XBRL DOCUMENT v3.25.0.1
Investments in Tax Credit Structures
 12 Months Ended
Dec. 31, 2024
Equity Method Investments and Joint Ventures [Abstract]  
Investments in Tax Credit Structures INVESTMENTS IN TAX CREDIT STRUCTURES
The Company invests in the equity of certain limited partnerships or limited liability companies that typically are associated with affordable housing partnerships and renewable solar energy projects that generate LIHTC and other income tax benefits for the Company.
The Company typically accounts for tax equity investments using the proportional amortization method (“PAM”), if certain criteria are met. The election to account for tax equity investments using the proportional amortization method is done on a tax-credit-program by tax-credit-program basis. Under the proportional amortization method, the Company amortizes the initial cost of the investment, which is inclusive of any commitments to make future equity contributions, in proportion to the income tax credits and other income tax benefits that are allocated to the Company over the period of the investment. The net benefits of these investments, which are comprised of income tax credits and operating loss income tax benefits, net of investment amortization, are recognized in the Consolidated Statements of Income as a component of income tax provision.
The Company records its investments in qualifying affordable housing partnerships, net, using the equity investment method. Following the adoption of ASU 2023-02 in 2024, the Company elects to account for its tax credit investments using PAM on a program-by-program basis if certain conditions are met. For the Company’s accounting policies on PAM, see Note 1 “Summary of Significant Accounting Policies”. In 2024, the Company’s investment in a solar tax credit was accounted under PAM and was recorded under other assets and its commitment to fund investments in tax credit structures in other liabilities in the Consolidated Statements of Financial Condition.
The following table presents the investments and unfunded commitment of the Company’s investments in tax credit structures at December 31, 2024 and 2023:
December 31, 2024December 31, 2023
AssetsUnfunded CommitmentsAssetsUnfunded Commitments
(Dollars in thousands)
PAM:
Investments in solar tax credit$3,425 $2,758 $— $— 
Equity method:
Investments in affordable housing partnerships32,354 11,283 54,474 21,017 
Total$35,779 $14,041 $54,474 $21,017 
The following table presents additional information related to tax credit and benefits and amortization recorded for the years ended December 31, 2024, 2023, and 2022.
Year Ended December 31,
202420232022
(Dollars in thousands)
Tax credits and benefits:
PAM
Investments in solar tax credit$18,211 $— $— 
Equity method
Investments in affordable housing partnerships11,067 11,271 11,197 
Total$29,278 $11,271 $11,197 
Amortization:
PAM
Investments in solar tax credit$16,575 $— $— 
Equity method
Investments in affordable housing partnerships9,051 8,195 8,742 
Total$25,626 $8,195 $8,742