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Derivatives | 9 Months Ended
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Sep. 30, 2021
Derivative Instruments And Hedging Activities Disclosure [Abstract] |
Derivatives | (14) Derivatives To accommodate customer need and to support the Company’s asset/liability positioning, on occasion we enter into interest rate swaps with a customer and a bank counterparty. The interest rate swaps are free-standing derivatives and are recorded at fair value. The Company enters into a floating rate loan and a fixed rate swap with our customer. Simultaneously, the Company enters into an offsetting fixed rate swap with a bank counterparty. In connection with each swap transaction, the Company agrees to pay interest to the customer on a notional amount at a variable interest rate and receive interest from the customer on the same notional amount at a fixed interest rate. At the same time, the Company agrees to pay a bank counterparty the same fixed interest rate on the same notional amount and receive the same variable interest rate on the same notional amount. These transactions allow the Company’s customer to effectively convert variable rate loans to fixed rate loans. Since the Company acts as an intermediary for its customer, changes in the fair value of the underlying derivative contracts offset each other and do not significantly impact the Company’s results of operations. None of the Company’s derivatives are designated as hedging instruments. The following table summarizes the Company’s interest rate swap positions as of September 30, 2021.
|  | Classification on the Consolidated Balance Sheet |  | Notional Amount |  |  | Fair Value |
Derivative Assets |  | Swap assets |  | $ | 239,230 |  |  | $ | 12,858 |
Derivative Liabilities |  | Swap liabilities |  |  | (239,230 | ) |  |  | (12,858 | )
Net Exposure |  |  |  | $ | — |  |  | $ | — |
The following table summarizes the Company’s interest rate swap positions as of December 31, 2020.
|  | Classification on the Consolidated Balance Sheet |  | Notional Amount |  |  | Fair Value |
Derivative Assets |  | Swap assets |  | $ | 244,748 |  |  | $ | 21,700 |
Derivative Liabilities |  | Swap liabilities |  |  | (244,748 | ) |  |  | (21,764 | )
Net Exposure |  |  |  | $ | — |  |  | $ | (64 | )
The Company monitors and controls all derivative products with a comprehensive Board of Director approved commercial loan swap policy. All interest rate swap transactions must be approved in advance by the Lenders Loan Committee or the Directors Loan Committee of the Board of Directors. The Company classifies changes in fair value of derivatives with “Other” in the Consolidated Statements of Operation. At September 30, 2021, the Company had cash and securities with a fair value of $7,000 and $7,035, respectively, pledged for collateral on its interest rate swaps with third party financial institutions. At December 31, 2020, the Company had cash and securities with a fair value of $11,300 and $11,705, respectively, pledged as collateral. Cash pledged for collateral on interest rate swaps is classified as restricted cash on the Consolidated Balance Sheet.

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- 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 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 40 -Section 50 -Paragraph 5 -Subparagraph (f) -URI http://asc.fasb.org/extlink&oid=123477628&loc=d3e90205-114008 + Details
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