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FHLB Advances, Other Borrowings and Subordinated Notes
 9 Months Ended
Sep. 30, 2022
Debt Disclosure [Abstract]  
FHLB Advances, Other Borrowings and Subordinated Notes FHLB Advances, Other Borrowings and Subordinated Notes
The following table is a summary of FHLB advances, other borrowings and subordinated notes as of the dates shown:
(In thousands)September 30,
2022		December 31,
2021		September 30,
2021
FHLB advances$2,316,071 $1,241,071 $1,241,071 
Other borrowings:
Notes payable64,268 80,319 85,668 
Short-term borrowings9,212 9,198 14,051 
Secured borrowings311,958 341,327 341,038 
Other61,777 63,292 63,770 
Total other borrowings447,215 494,136 504,527 
Subordinated notes437,260 436,938 436,811 
Total FHLB advances, other borrowings and subordinated notes$3,200,546 $2,172,145 $2,182,409 

FHLB Advances

FHLB advances consist of obligations of the banks and are collateralized by qualifying commercial and residential real estate and home equity loans and certain securities. FHLB advances are stated at par value of the debt adjusted for unamortized prepayment fees paid at the time of prior restructurings of FHLB advances, unamortized fair value adjustments recorded in connection with advances acquired through acquisitions and debt issuance costs.

Notes Payable

On September 18, 2018, the Company established a term facility (“Term Facility”), which is part of a loan agreement (“Credit Agreement”) with unaffiliated banks. The Credit Agreement consists of the Term Facility with an original outstanding balance
of $150.0 million and a $100.0 million revolving credit facility (“Revolving Credit Facility”). The Term Facility is stated at par of the current outstanding balance of the debt adjusted for unamortized costs paid by the Company in relation to the debt issuance. Unamortized costs paid by the Company in relation to the issuance of the Revolving Credit Facility are classified in other assets on the Consolidated Statements of Condition. The Company was contractually required to borrow the entire amount of the Term Facility on September 18, 2018 and all such borrowings must be repaid by September 18, 2023. The Company is required to make quarterly payments of principal plus interest on the Term Facility. At September 30, 2022, the Company had a notes payable balance of $64.3 million under the Term Facility. At September 30, 2022, the Company had no outstanding balance under the Revolving Credit Facility.

An additional amendment to the Credit Agreement was executed and effective as of September 13, 2022. The amendment provided for, among other things, increases in the applicable rate with respect to each Term SOFR Loan (in the case of a borrowing under the Revolving Credit Facility) from 1.45% to 1.55% and with respect to each Base Rate Loan (in the case of a borrowing under the Revolving Credit Facility) from 0.60% to 0.70%. The amendment also extended the maturity date under the Revolving Credit Facility to September 12, 2023.

Borrowings under the amended Credit Agreement that are considered “Base Rate Loans” bear interest at a rate equal to the sum of (1) 70 basis points (in the case of a borrowing under the Revolving Credit Facility) or 75 basis points (in the case of a borrowing under the Term Facility) plus (2) the highest of (a) the lenders prime rate, (b) the federal funds rate plus 50 basis points, and (c) Term SOFR for a one-month tenor in effect on such day plus 110 basis points (in the case of a borrowing under the Revolving Credit Facility) or the Eurodollar Rate (as defined below) that would be applicable for an interest period of one month plus 100 basis points (in the case of a borrowing under the Term Facility). Borrowings under the agreement that are considered “Term SOFR Loans” bear interest at a rate equal to the sum of (1) 155 basis points (in the case of a borrowing under the Revolving Credit Facility) or 125 basis points if considered “Eurodollar Rate Loans” (in the case of a borrowing under the Term Facility) plus (2) the SOFR rate for the applicable period, as adjusted for statutory reserve requirements for eurocurrency liabilities (the “Eurodollar Rate”). A commitment fee is payable quarterly equal to 0.30% of the actual daily amount by which the lenders’ commitment under the Revolving Credit Facility exceeded the amount outstanding under such facility.

Borrowings under the amended Credit Agreement are secured by pledges of and first priority perfected security interests in the Company’s equity interest in its bank subsidiaries and contain several restrictive covenants, including the maintenance of various capital adequacy levels, asset quality and profitability ratios, and certain restrictions on dividends and other indebtedness. At September 30, 2022, the Company was in compliance with all such covenants. The Revolving Credit Facility and the Term Facility are available to be utilized, as needed, to provide capital to fund continued growth at the Company’s banks and to serve as an interim source of funds for acquisitions, common stock repurchases or other general corporate purposes.

Short-term Borrowings

Short-term borrowings include securities sold under repurchase agreements of customer sweep accounts in connection with master repurchase agreements at the banks. These borrowings totaled $9.2 million at September 30, 2022 compared to $9.2 million at December 31, 2021 and $14.1 million at September 30, 2021. The Company records securities sold under repurchase agreements at their gross value and does not offset positions on the Consolidated Statements of Condition. As of September 30, 2022, the Company had pledged securities related to its customer balances in sweep accounts of $18.1 million. Securities pledged for customer balances in sweep accounts and short-term borrowings from brokers are maintained under the Company’s control and consist of mortgage-backed securities and U.S. government agencies. These securities are included in the available-for-sale portfolio as reflected on the Company’s Consolidated Statements of Condition.
The following is a summary of these securities pledged as of September 30, 2022 disaggregated by investment category and maturity of the related customer sweep account, and reconciled to the outstanding balance of securities sold under repurchase agreements:
(In thousands)Overnight Sweep Collateral
Available-for-sale securities pledged
U.S. government agencies$9,122 
Mortgage-backed securities8,972 
Total collateral pledged18,094 
Excess collateral8,882 
Securities sold under repurchase agreements$9,212 

Secured Borrowings

Secured borrowings at September 30, 2022 primarily represent transactions to sell an undivided co-ownership interest in all receivables owed to the Company’s subsidiary, First Insurance Funding of Canada (“FIFC Canada”). In December 2014, FIFC Canada sold such interest to an unrelated third party in exchange for a cash payment of approximately C$150 million pursuant to a receivables purchase agreement (“Receivables Purchase Agreement”). Amendments to the Receivables Purchase Agreement since issuance increased the total payments to C$420 million and extended the maturity date to December 15, 2023. These transactions were not considered sales of receivables and, as such, related proceeds received are reflected on the Company’s Consolidated Statements of Condition as a secured borrowing owed to the unrelated third party, net of unamortized debt issuance costs, and translated to the Company’s reporting currency as of the respective date. At September 30, 2022, the translated balance of the secured borrowing totaled $303.5 million compared to $332.2 million at December 31, 2021 and $331.0 million at September 30, 2021. The interest rate under the Receivables Purchase Agreement is the Canadian Commercial Paper Rate plus 78 basis points.

The remaining $8.4 million within secured borrowings at September 30, 2022 represents other sold interests in certain loans by the Company that were not considered sales and, as such, related proceeds received are reflected on the Company’s Consolidated Statements of Condition as a secured borrowing owed to the various unrelated third parties.

Other Borrowings

Other borrowings at September 30, 2022 represent a fixed-rate promissory note (“Fixed-Rate Promissory Note”) issued by the Company in June 2017. Amendments to the Fixed-Rate Promissory Note since issuance increased the principal amount to $66.4 million, reduced the interest rate to 1.70% and extended the maturity date to March 31, 2025. The Fixed-Rate Promissory Note relates to and is secured by three office buildings owned by the Company. At September 30, 2022, the Fixed-Rate Promissory Note had a balance of $61.8 million compared to $63.3 million at December 31, 2021 and $63.8 million at September 30, 2021. Under the Fixed-Rate Promissory Note, during the nine months ended September 30, 2022, the Company made monthly principal and interest payments. The Fixed-Rate Promissory Note contains several restrictive covenants, including the maintenance of various capital adequacy levels, asset quality and profitability ratios, and certain restrictions on dividends and indebtedness. At September 30, 2022, the Company was in compliance with all such covenants.

Subordinated Notes

At September 30, 2022, the Company had outstanding subordinated notes totaling $437.3 million compared to $436.9 million and $436.8 million outstanding at December 31, 2021 and September 30, 2021, respectively. In 2019, the Company issued $300.0 million of subordinated notes, receiving $296.7 million in net proceeds. The subordinated notes have a stated interest rate of 4.85% and mature in June 2029. In 2014, the Company issued $140.0 million of subordinated notes receiving $139.1 million in net proceeds. The subordinated notes have a stated interest rate of 5.00% and mature in June 2024. Subordinated notes are stated at par adjusted for unamortized issuance costs paid related to such debt.