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Investments in Tax Credits Structures
12 Months Ended
Dec. 31, 2024
Equity Method Investments and Joint Ventures [Abstract]  
Investments in Tax Credits Structures Investments in Tax Credits Structures
The Company's tax credit investments include LIHTC investments and a Solar Tax Credit investment. LIHTC investments promote qualified affordable housing projects, some of which also support the Company’s regulatory compliance with the Community Reinvestment Act. The Company’s investments in these entities generate a return primarily through the realization of federal income tax credits and other tax benefits, such as tax deductions from operating losses of the investments, over specified time periods. These tax credits and deductions are recognized as a reduction to income tax expense.
LIHTC Investments
The carrying values of investments in unconsolidated LIHTCs were $187.2 million and $207.3 million as of December 31, 2024 and 2023, respectively, as a component of prepaid expense and other assets in the Consolidated Statements of Financial Condition. LIHTCs are accounted for using the proportional amortization method. During the years ended December 31, 2024, 2023 and 2022 the Company recognized proportional amortization of $20.0 million, $16.5 million and $10.9 million, respectively as a component of income tax in the Consolidated Statements of Income.
Total unfunded contingent commitments related to the Company’s LIHTC investments totaled $81.2 million and $107.9 million at December 31, 2024 and 2023, respectively, as a component of accrued expenses and other liabilities in the Consolidated Statements of Financial Condition. The Company expects to fund LIHTC commitments totaling $65.3 million during the year ending December 31, 2025 and $5.5 million during the year ending December 31, 2026, with the remaining commitments of $10.4 million to be funded by December 31, 2041.
There were no impairment losses on the Company’s LIHTC investments during the years ended December 31, 2024, 2023 and 2022.
Solar Tax Credit Investment
The Solar Tax Credit investment is accounted for using the equity method. During the years ended December 31, 2024 and 2023, respectively, the Company recognized amortization expense of $101 and $21, respectively, which was included within other expense in the Consolidated Statements of Income.