XML 31 R19.htm IDEA: XBRL DOCUMENT
v3.10.0.1

Derivatives | 9 Months Ended
--- | ---
Sep. 30, 2018
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Derivatives | Derivatives Financial derivatives are reported at fair value in other assets or other liabilities. The accounting for changes in the fair value of a derivative depends on whether it has been designated and qualifies as part of a hedging relationship. For derivatives not designated as hedges, the gain or loss is recognized in current period earnings. Derivatives designated as fair value hedges For derivative instruments that are designated and qualify as a fair value hedge, the gain or loss on the derivative instrument as well as the offsetting loss or gain on the hedged asset or liability attributable to the hedged risk are recognized in current earnings. The gain or loss on the derivative instrument is presented on the same income statement line item as the earnings effect of the hedged item. The Company utilizes interest rate swaps designated as fair value hedges to mitigate the effect of changing interest rates on the fair values of fixed rate callable securities available-for-sale. The hedging strategy on securities converts the fixed interest rates to LIBOR-based variable interest rates. These derivatives are designated as partial term hedges of selected cash flows covering specified periods of time prior to the call dates of the hedged securities. The Company has elected early adoption of FASB ASU 2017-12, which allows such partial term hedge designations. On September 14, 2018, the Company entered into eight swap transactions with a notional amount of $25 million designated as fair value hedges. These derivatives are intended to protect against the effects of changing interest rates on the fair values of fixed rate securities. A summary of the Company's fair value hedge relationships as of September 30, 2018 are as follows (in thousands):
|  |  |  |  | September 30, 2018
| Balance Sheet Location | Weighted Average Remaining Maturity (In Years) | Weighted Average Pay Rate | Receive Rate | Notional Amount | Estimated Fair Value
Asset derivatives |  |  |  |  |  |
Interest rate swap agreements - securities | Other assets | 9.59 | 3.10% | 3 month LIBOR | $11,000 | $14
Liability derivatives |  |  |  |  |  |
Interest rate swap agreements - securities | Other assets | 9.63 | 3.13% | 3 month LIBOR | $14,000 | -$21
Note 11. Derivatives (continued): There were no fair value hedge relationships as of December 31, 2017. The effects of the Company's fair value hedge relationships on the income statement during the three and nine months ended September 30, 2018 were as follows (in thousands):
| Nine Months Ended September 30, 2018
| Interest Income
Total amount of income and expense line items presented in the consolidated statements of income | $65,439
Gain (loss) on fair value hedging relationship |
Interest rate swap agreements - securities: |
Hedged items | (7)
Derivative designated as hedging instruments | 7
| Three Months Ended September 30, 2018
| Interest Income
Total amount of income and expense line items presented in the consolidated statements of income | $23,068
Gain (loss) on fair value hedging relationship |
Interest rate swap agreements - securities: |
Hedged items | (7)
Derivative designated as hedging instruments | 7
The following amounts were recorded on the balance sheet related to cumulative basis adjustments for fair value hedges at September 30, 2018 which includes a $3 million security purchased but in the process of settling after September 30, 2018:
| Carrying Amount of the Hedged Assets (in thousands) | Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets
Line item on the balance sheet | September 30, 2018 | September 30, 2018
Securities available-for-sale | $27,639 | $7

X
- References No definition available. + Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -URI http://asc.fasb.org/topic&trid=2229140 + Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration