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Derivatives Financial Instruments | 9 Months Ended
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Sep. 30, 2025
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Derivatives Financial Instruments | Note 10.Derivatives Financial Instruments Derivatives designated as fair value hedges: 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 derivative instruments that are designated and qualify as a fair value hedge, the gain or loss on the derivative net investment hedge instrument as well as the offsetting gain or loss 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 certain fixed rate securities designated as available-for-sale. The hedging strategy converts the fixed interest rates to SOFR-based variable interest rates. These derivatives are designated as partial term hedges covering specified periods of time prior to the maturity date of the hedged securities. The Company adopted ASU 2017-12, “Derivatives and Hedging (Topic 815) - Targeted Improvements to Accounting for Hedging Activities” in 2018, which allows such partial term hedge designations. ​ A summary of the Company’s fair value hedge relationships for the periods presented are as follows (dollars in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | ​ |  | Weighted |  | ​ |  | ​ |  | ​ | ​ |  | ​ |
​ | ​ | ​ | ​ | Average | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |
​ | ​ | Balance | ​ | Remaining | ​ | Weighted | ​ | ​ | ​ | ​ | ​ | ​ | ​ |
​ | ​ | Sheet | ​ | Maturity | ​ | Average | ​ | Receive | ​ | Notional | ​ | Estimated
Asset/Liability derivatives | ​ | Location | ​ | (In Years) | ​ | Pay Rate | ​ | Rate | ​ | Amount | ​ | Fair Value
September 30, 2025: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Interest rate swap agreements - securities | ​ | Other liabilities |  | 0.95 |  | 4.31 | % | SOFR | ​ | $ | 51,507 |  | $ | (373)
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |  | ​
December 31, 2024: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Interest rate swap agreements - securities |  | Other liabilities |  | 1.70 |  | 4.31 | % | SOFR | ​ | $ | 51,507 |  | $ | (224)
​ ​ The effects of the Company’s fair value hedge relationships reported in interest income on taxable securities on the consolidated income statement were as follows (in thousands): ​ ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended
​ | ​ | September 30, | ​ | September 30,
​ |  | 2025 | ​ | 2024 | ​ | 2025 | ​ | 2024
Interest income on taxable securities |  | $ | 4,872 | ​ | $ | 5,091 | ​ | $ | 14,492 | ​ | $ | 14,710
Effects of fair value hedge relationships | ​ |  | 4 | ​ |  | 142 | ​ |  | 7 | ​ |  | 391
Reported interest income on taxable securities | ​ | $ | 4,876 | ​ | $ | 5,233 | ​ | $ | 14,499 | ​ | $ | 15,101
​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended
​ | ​ | September 30, | ​ | September 30,
Gain (loss) on fair value hedging relationship |  | 2025 | ​ | 2024 | ​ | 2025 | ​ | 2024
Interest rate swap agreements - securities: |  |  |  | ​ | ​ |  | ​ |  |  | ​ | ​ |
Hedged items |  | $ | (22) | ​ | $ | (1,069) | ​ | $ | 148 | ​ | $ | (955)
Derivative designated as hedging instruments | ​ | ​ | 22 | ​ | ​ | 1,069 | ​ | ​ | (148) | ​ | ​ | 955
Carry amount of hedged assets - mortgage-backed securities | ​ | ​ | 49,328 | ​ | ​ | 48,886 | ​ | ​ | 49,328 | ​ | ​ | 48,886
​ ​ Derivatives Designated as Cash Flow Hedges: ​ The Company enters into interest rate derivative contracts on assets and liabilities that are designated as qualifying cash flow hedges. The Company hedges the exposure to variability in expected future cash flows attributable to changes in contractual specified interest rates. To qualify for hedge accounting, a formal assessment is prepared to determine whether the hedging relationship, both at inception and on an ongoing basis, is expected to be highly effective in offsetting cash flows attributable to the hedged risk. At inception, a statistical regression analysis is prepared to determine hedge effectiveness. At each reporting period thereafter, a statistical regression or qualitative analysis is performed. If it is determined that hedge effectiveness has not been or will not continue to be highly effective, then hedge accounting ceases and any gain or loss in accumulated other comprehensive income (“AOCI”) is recognized in earnings immediately. The cash flow hedges are recorded at fair value in other assets and liabilities on the consolidated balance sheets with changes in fair value recorded in AOCI, net of tax, see – Consolidated Statements of Comprehensive Income (Loss). Amounts recorded to AOCI are reclassified into earnings in the same period in which the hedged asset or liability affects earnings and are presented in the same income statement line item as the earnings effect of the hedged asset or liability, as future interest payments are made on the underlying assets. At September 30, 2025, the Company estimates that there will not be any reclassifications into interest income or interest expense over the next 12 months. ​ At September 30, 2025 and December 31, 2024, cash flow hedges are as follows (in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, 2025 | ​ | December 31, 2024
​ | ​ | Balance Sheet | ​ | Notional | ​ | Estimated | ​ | Balance Sheet | ​ | Notional | ​ | Estimated
​ | ​ | Location | ​ | Amount | ​ | Fair Value | ​ | Location | ​ | Amount | ​ | Fair Value
Cash flow hedges: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Assets | ​ | Other assets | ​ | $ | 100,000 | ​ | $ | 35 | ​ | Other assets | ​ | $ | - | ​ | $ | -
Assets | ​ | Other liabilities | ​ | ​ | - | ​ | ​ | - | ​ | Other liabilities | ​ | ​ | 100,000 | ​ | ​ | (559)
Liabilities | ​ | Other assets | ​ | ​ | - | ​ | ​ | - | ​ | Other assets | ​ | ​ | - | ​ | ​ | -
Liabilities | ​ | Other liabilities | ​ | ​ | - | ​ | ​ | - | ​ | Other liabilities | ​ | ​ | 150,000 | ​ | ​ | (280)
​ The following table presents the effect of fair value and cash flow hedge accounting on AOCI (in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Derivatives in cash flow hedging relationships: | ​ | ​ | Amount of Gain (Loss) Recognized on OCI on Derivative | ​ | Location of Gain or (Loss) Recognized from AOCI into Income | ​ | ​ | Amount of Gain or (Loss) Reclassified from AOCI into Income
Three Months Ended September 30, 2025 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Interest rate swaps - Assets | ​ | $ | (4) | ​ | Interest income | ​ | $ | —
Interest rate swaps - Liabilities | ​ | ​ | — | ​ | Interest expense | ​ | ​ | —
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Three Months Ended September 30, 2024 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Interest rate swaps - Assets | ​ | $ | 1,177 | ​ | Interest income | ​ | $ | (203)
Interest rate swaps - Liabilities | ​ | ​ | (943) | ​ | Interest expense | ​ | ​ | 227
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Nine Months Ended September 30, 2025 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Interest rate swaps - Assets | ​ | $ | 595 | ​ | Interest income | ​ | $ | (2)
Interest rate swaps - Liabilities | ​ | ​ | 280 | ​ | Interest expense | ​ | ​ | (237)
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Nine Months Ended September 30, 2024 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Interest rate swaps - Assets | ​ | $ | 532 | ​ | Interest income | ​ | $ | (610)
Interest rate swaps - Liabilities | ​ | ​ | 240 | ​ | Interest expense | ​ | ​ | 724
​ ​ The following table presents the effect of fair value and cash flow hedge accounting on the income statement (in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended
​ | ​ | September 30, | ​ | September 30,
​ |  | 2025 | ​ | 2024 | ​ | 2025 | ​ | 2024
Total interest income |  | $ | 74,518 | ​ | $ | 64,159 | ​ | $ | 210,350 | ​ | $ | 185,633
Effects of cash flow hedge relationships | ​ |  | — | ​ |  | (203) | ​ |  | (2) | ​ |  | (610)
Reported total interest income | ​ | $ | 74,518 | ​ | $ | 63,956 | ​ | $ | 210,348 | ​ | $ | 185,023
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total interest expense |  | $ | 32,088 | ​ | $ | 29,151 | ​ | $ | 89,100 | ​ | $ | 86,180
Effects of cash flow hedge relationships | ​ |  | — | ​ |  | (227) | ​ |  | 237 | ​ |  | (724)
Reported total interest expense | ​ | $ | 32,088 | ​ | $ | 28,924 | ​ | $ | 89,337 | ​ | $ | 85,456
​ Non-hedged derivatives: ​ The Company provides a loan hedging program to certain loan customers. Through this program, the Company originates a variable rate loan with the customer. The Company and the customer will then enter into a fixed interest rate swap. Lastly, an identical offsetting swap is entered into by the Company with a dealer bank. These “back-to-back” swap arrangements are intended to offset each other and allow the Company to book a variable rate loan, while providing the customer with a contract for fixed interest payments. In these arrangements, the Company’s net cash flow is equal to the interest income received from the variable rate loan originated with the customer. These customer swaps are not designated as hedging instruments and are recorded at fair value in other assets and other liabilities. Since the income statement impact of the offsetting positions is limited, any changes in fair value are recognized as other noninterest income in the current period. ​ At September 30, 2025, and December 31, 2024, interest rate swaps related to the Company’s loan hedging program that were outstanding are presented in the following table (in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | September 30, 2025 | ​ | December 31, 2024
​ | ​ | ​ | Notional | ​ | ​ | Estimated | ​ | ​ | Notional | ​ | ​ | Estimated
​ | ​ | ​ | Amount | ​ | ​ | Fair Value | ​ | ​ | Amount | ​ | ​ | Fair Value
Interest rate swap agreements: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Assets | ​ | $ | 511,076 | ​ | $ | 13,261 | ​ | $ | 393,268 | ​ | $ | 12,135
Liabilities | ​ | ​ | 511,076 | ​ | ​ | (13,261) | ​ | ​ | 393,268 | ​ | ​ | (12,135)
​ The Company establishes limits and monitors exposures for customer swap positions. Any fees received to enter the swap agreements at inception are recognized in earnings when received and is included in noninterest income. Such fees were as follows (in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended | ​ | Nine Months Ended
​ | ​ | September 30, | ​ | September 30,
​ |  | 2025 | ​ | 2024 | ​ | 2025 | ​ | 2024
Interest rate swap agreements |  | $ | 254 | ​ | $ | 1,103 | ​ | $ | 1,252 | ​ | $ | 1,378
​ Collateral requirements: ​ These derivative rate contracts have collateral requirements, both at inception of the trade and as the value of each derivative position changes. At September 30, 2025, and December 31, 2024, collateral totaling $150 thousand was pledged to the derivative counterparties to comply with collateral requirements.

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