Derivatives (Tables)

12 Months Ended

Dec. 31, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of notional and fair values of derivatives

The following table presents the total notional amounts and gross fair values of the Company’s derivatives, as well as the balance sheet netting adjustments on an aggregate basis as of December 31, 2020 and 2019. The derivative assets and liabilities are presented on a gross basis prior to the application of bilateral collateral and master netting agreements, but after the variation margin payments with central clearing organizations have been applied as settlement, as applicable. Total derivative assets and liabilities are adjusted to take into consideration the effects of legally enforceable master netting agreements and cash collateral received or paid as of December 31, 2020 and 2019. The resulting net derivative asset and liability fair values are included in Other assets and Accrued expenses and other liabilities, respectively, on the Consolidated Balance Sheet.

($ in thousands)	December 31, 2020							December 31, 2019
	Notional Amount			Fair Value				Notional Amount			Fair Value
				Derivative Assets		Derivative Liabilities					Derivative Assets		Derivative Liabilities
Derivatives designated as hedging instruments:
Fair value hedges:
Interest rate contracts	$	—		$	—	$	—	$	31,026		$	—	$	3,198
Cash flow hedges:
Interest rate contracts	275,000			—		1,864		—			—		—
Net investment hedges:
Foreign exchange contracts	84,269			—		235		86,167			—		1,586
Total derivatives designated as hedging instruments	$	359,269		$	—	$	2,099	$	117,193		$	—	$	4,784
Derivatives not designated as hedging instruments:
Interest rate contracts	$	18,155,678		$	489,132	$	315,834	$	15,489,692		$	192,883	$	124,119
Foreign exchange contracts	3,108,488			30,300		22,524		4,839,661			54,637		47,024
Credit contracts	76,992			13		206		210,678			2		84
Equity contracts	—		(1)	858		—		—		(1)	1,414		—
Commodity contracts	—		(2)	82,451		84,165		—		(2)	81,380		80,517
Total derivatives not designated as hedging instruments	$	21,341,158		$	602,754	$	422,729	$	20,540,031		$	330,316	$	251,744
Gross derivative assets/liabilities				$	602,754	$	424,828				$	330,316	$	256,528
Less: Master netting agreements				(93,063)		(93,063)					(121,561)		(121,561)
Less: Cash collateral received/paid				(8,449)		(91,634)					(3,758)		(38,238)
Net derivative assets/liabilities				$	501,242	$	240,131				$	204,997	$	96,729

(1)The Company held equity contracts in two public companies and 17 private companies as of December 31, 2020. In comparison, the Company held equity contracts in three public companies and 18 private companies as of December 31, 2019.

(2)The notional amount of the Company’s commodity contracts entered with its customers totaled 6,321 thousand barrels of crude oil and 109,635 thousand units of natural gas, measured in million British thermal units (“MMBTUs”) as of December 31, 2020. In comparison, the notional amount of the Company’s commodity contracts entered with its customers totaled 7,811 thousand barrels of crude oil and 63,773 thousand MMBTUs of natural gas as of December 31, 2019. The Company simultaneously entered into the offsetting commodity contracts with mirrored terms with third-party financial institutions.

The following tables present the notional amounts and the gross fair values of interest rate derivative contracts outstanding as of December 31, 2020 and 2019:

($ in thousands)	December 31, 2020
	Customer Counterparty						($ in thousands)	Financial Counterparty
	Notional Amount		Fair Value					Notional Amount		Fair Value
			Assets		Liabilities					Assets		Liabilities
Written options	$	957,393	$	—	$	115	Purchased options	$	957,393	$	101	$	15
Sold collars and corridors	518,477		7,673		—		Collars and corridors	518,477		—		7,717
Swaps	7,586,414		479,634		1,364		Swaps	7,617,524		1,724		306,623
Total	$	9,062,284	$	487,307	$	1,479	Total	$	9,093,394	$	1,825	$	314,355

($ in thousands)	December 31, 2019
	Customer Counterparty						($ in thousands)	Financial Counterparty
	Notional Amount		Fair Value					Notional Amount		Fair Value
			Assets		Liabilities					Assets		Liabilities
Written options	$	1,003,558	$	—	$	66	Purchased options	$	1,003,558	$	67	$	—
Sold collars and corridors	490,852		1,971		16		Collars and corridors	490,852		17		1,996
Swaps	6,247,667		187,294		6,237		Swaps	6,253,205		3,534		115,804
Total	$	7,742,077	$	189,265	$	6,319	Total	$	7,747,615	$	3,618	$	117,800

The following tables present the notional amounts and the gross fair values of foreign exchange derivative contracts outstanding as of December 31, 2020 and 2019:

($ in thousands)	December 31, 2020
	Customer Counterparty							Financial Counterparty
	Notional Amount		Fair Value					Notional Amount		Fair Value
			Assets		Liabilities		($ in thousands)			Assets		Liabilities
Forwards and spot	$	1,522,888	$	17,575	$	17,928	Forwards and spot	$	145,197	$	1,230	$	273
Swaps	13,590		872		91		Swaps	1,191,355		10,049		3,658
Written options	117,729		—		574		Purchased options	117,729		574		—
Total	$	1,654,207	$	18,447	$	18,593	Total	$	1,454,281	$	11,853	$	3,931

($ in thousands)	December 31, 2019
	Customer Counterparty							Financial Counterparty
	Notional Amount		Fair Value					Notional Amount		Fair Value
			Assets		Liabilities		($ in thousands)			Assets		Liabilities
Forwards and spot	$	3,581,036	$	45,911	$	40,591	Forwards and spot	$	207,492	$	1,400	$	507
Swaps	6,889		16		84		Swaps	702,391		6,156		4,712
Written options	87,036		127		—		Purchased options	87,036		—		127
Collars	2,244		—		14		Collars	165,537		1,027		989
Total	$	3,677,205	$	46,054	$	40,689	Total	$	1,162,456	$	8,583	$	6,335

The following table presents the notional amounts and the gross fair values of RPAs sold and purchased outstanding as of December 31, 2020 and 2019:

($ in thousands)	December 31, 2020						December 31, 2019
	Notional Amount		Fair Value				Notional Amount		Fair Value
			Assets		Liabilities				Assets		Liabilities
RPAs - protection sold	$	66,278	$	—	$	206	$	199,964	$	—	$	84
RPAs - protection purchased	10,714		13		—		10,714		2		—
Total RPAs	$	76,992	$	13	$	206	$	210,678	$	2	$	84

The following tables present the notional amounts and fair values of the commodity derivative positions outstanding as of December 31, 2020 and 2019.

($ and units in thousands)	December 31, 2020
	Customer Counterparty						($ and units in thousands)	Financial Counterparty
	Notional Unit		Fair Value					Notional Unit		Fair Value
			Assets		Liabilities					Assets		Liabilities
Crude oil:							Crude oil:
Collars	2,022	Barrels	$	2,344	$	2,193	Collars	2,022	Barrels	$	2,217	$	2,402
Swaps	4,299	Barrels	9,282		14,283		Swaps	4,299	Barrels	8,220		7,135
Total	6,321		$	11,626	$	16,476	Total	6,321		$	10,437	$	9,537
Natural gas:							Natural gas:
Written options	597	MMBTUs	$	—	$	59	Purchased options	597	MMBTUs	$	59	$	—
Collars	12,733	MMBTUs	1,063		205		Collars	16,293	MMBTUs	205		813
Swaps	96,305	MMBTUs	32,073		27,238		Swaps	103,973	MMBTUs	26,988		29,837
Total	109,635		$	33,136	$	27,502	Total	120,863		$	27,252	$	30,650
Total			$	44,762	$	43,978	Total			$	37,689	$	40,187

($ and units in thousands)	December 31, 2019
	Customer Counterparty						($ and units in thousands)	Financial Counterparty
	Notional Unit		Fair Value					Notional Unit		Fair Value
			Assets		Liabilities					Assets		Liabilities
Crude oil:							Crude oil:
Written options	36	Barrels	$	—	$	30	Purchased options	36	Barrels	$	29	$	—
Collars	3,174	Barrels	2,673		538		Collars	3,630	Barrels	677		2,815
Swaps	4,601	Barrels	6,949		5,531		Swaps	4,721	Barrels	4,516		5,215
Total	7,811		$	9,622	$	6,099	Total	8,387		$	5,222	$	8,030
Natural gas:							Natural gas:
Written options	540	MMBTUs	$	—	$	22	Purchased options	530	MMBTUs	$	21	$	—
Collars	14,277	MMBTUs	186		522		Collars	14,517	MMBTUs	471		150
Swaps	48,956	MMBTUs	30,257		35,497		Swaps	48,779	MMBTUs	35,601		30,197
Total	63,773		$	30,443	$	36,041	Total	63,826		$	36,093	$	30,347
Total			$	40,065	$	42,140	Total			$	41,315	$	38,377

Schedule of net gains (losses) recognized on the Consolidated Statements of Income related to derivatives designated as fair value hedge

The following table presents the net gains (losses) recognized on the Consolidated Statement of Income related to the derivatives designated as fair value hedges for the years ended December 31, 2020, 2019 and 2018:

($ in thousands)	Year Ended December 31,
	2020		2019		2018
Gains (losses) recorded in interest expense:
Recognized on interest rate swaps	$	3,146	$	2,655	$	(93)
Recognized on certificates of deposit	$	(1,605)	$	(2,536)	$	278

Schedule of the carrying amount and associated cumulative basis adjustment related to the application of fair value hedge accounting that is included in the carrying amount of the hedged certificates of deposit

The carrying amount and associated cumulative basis adjustment related to the application of fair value hedge accounting that is included in the carrying amount of the hedged certificates of deposit as of December 31, 2020 and 2019:

($ in thousands)	Carrying Value (1)				Cumulative Fair Value Adjustment (2)
	December 31,				December 31,
	2020		2019		2020		2019
Certificates of deposit	$	—	$	(29,080)	$	—	$	1,604

(1)Represents the full carrying amount of the hedged certificates of deposit.

(2)For liabilities, (increase) decrease to carrying value.

Schedule of pre-tax changes in AOCI from cash flows hedges

The following table presents the pre-tax changes in AOCI from cash flow hedges for the years ended December 31, 2020, 2019 and 2018. The after-tax impact of cash flow hedges on AOCI is shown in Note 14 — Accumulated Other Comprehensive Income (Loss) to the Consolidated Financial Statements in the Form-10-K.

($ in thousands)	Year Ended December 31,
	2020		2019		2018
Losses recognized in AOCI	$	(1,604)	$	—	$	—
Gains reclassified from AOCI to Interest expense	$	113	$	—	$	—

Schedule of gains (losses) related to net investment hedges on a pre-tax basis in accumulated other comprehensive income (loss) and Consolidated Statements of Income

The following table presents the after-tax (losses) gains recognized in AOCI on net investment hedges for the years ended December 31, 2020, 2019 and 2018:

($ in thousands)	Year Ended December 31,
	2020		2019		2018
(Losses) gains recognized in AOCI	$	(4,801)	$	(471)	$	6,072

Schedule of net gains (losses) recognized on the Consolidated Statements of Income related to derivatives not designated as hedging instruments

The following table presents the net gains (losses) recognized on the Company’s Consolidated Statement of Income related to derivatives not designated as hedging instruments for the years ended December 31, 2020, 2019 and 2018:

($ in thousands)	Classification on Consolidated Statement of Income	Year Ended December 31,
		2020		2019		2018
Derivatives not designated as hedging instruments:
Interest rate contracts	Interest rate contracts and other derivative income	$	(8,637)	$	(2,126)	$	280
Foreign exchange contracts	Foreign exchange income	23,215		22,264		16,784
Credit contracts	Interest rate contracts and other derivative income	(5)		59		(156)
Equity contracts	Lending fees	11,025		678		512
Commodity contracts	Interest rate contracts and other derivative income	(35)		(67)		(11)
Net gains		$	25,563	$	20,808	$	17,409

Schedule of gross derivative fair values, the balance sheet netting adjustments and net fair values on the Consolidated Balance Sheets, as well as the cash and non-cash collateral

The following tables present the gross derivative fair values, the balance sheet netting adjustments and the resulting net fair values recorded on the consolidated balance sheet, as well as the cash and noncash collateral associated with master netting arrangements. The gross amounts of derivative assets and liabilities are presented after the application of variation margin payments as settlements with central counterparties, where applicable. The collateral amounts in the following tables are limited to the outstanding balances of the related asset or liability, after the application of netting; therefore instances of overcollateralization are not shown:

($ in thousands)	As of December 31, 2020
	Gross Amounts Recognized (1)		Gross Amounts Offset on the Consolidated Balance Sheet				Net Amounts Presented on the Consolidated Balance Sheet		Gross Amounts Not Offset on the Consolidated Balance Sheet		Net Amount
			Master Netting Arrangements		Cash Collateral Received (3)				Security Collateral Received (5)
Derivative assets	$	602,754	$	(93,063)	$	(8,449)	$	501,242	$	(35)	$	501,207
	Gross Amounts Recognized (2)		Gross Amounts Offset on the Consolidated Balance Sheet				Net Amounts Presented on the Consolidated Balance Sheet		Gross Amounts Not Offset on the Consolidated Balance Sheet		Net Amount
			Master Netting Arrangements		Cash Collateral Pledged (4)				Security Collateral Pledged (5)
Derivative liabilities	$	424,828	$	(93,063)	$	(91,634)	$	240,131	$	(221,150)	$	18,981

($ in thousands)	As of December 31, 2019
	Gross Amounts Recognized (1)		Gross Amounts Offset on the Consolidated Balance Sheet				Net Amounts Presented on the Consolidated Balance Sheet		Gross Amounts Not Offset on the Consolidated Balance Sheet		Net Amount
			Master Netting Arrangements		Cash Collateral Received (3)				Security Collateral Received (5)
Derivative assets	$	330,316	$	(121,561)	$	(3,758)	$	204,997	$	—	$	204,997
	Gross Amounts Recognized (2)		Gross Amounts Offset on the Consolidated Balance Sheet				Net Amounts Presented on the Consolidated Balance Sheet		Gross Amounts Not Offset on the Consolidated Balance Sheet		Net Amount
			Master Netting Arrangements		Cash Collateral Pledged (4)				Security Collateral Pledged (5)
Derivative liabilities	$	256,528	$	(121,561)	$	(38,238)	$	96,729	$	(79,619)	$	17,110

(1)Included $1.1 million and $1.6 million of gross fair value assets with counterparties that were not subject to enforceable master netting arrangements or similar agreements as of December 31, 2020 and 2019, respectively.

(2)Included $220 thousand and $20 thousand of gross fair value liabilities with counterparties that were not subject to enforceable master netting arrangements or similar agreements as of December 31, 2020 and 2019, respectively.

(3)Gross cash collateral received under master netting arrangements or similar agreements were $15.8 million and $3.8 million, respectively, as of December 31, 2020 and 2019. Of the gross cash collateral received, $8.4 million and $3.8 million were used to offset against derivative assets, respectively, as of December 31, 2020 and 2019.

(4)Gross cash collateral pledged under master netting arrangements or similar agreements were $91.6 million and $43.0 million, respectively, as of December 31, 2020 and 2019. Of the gross cash collateral pledged, $91.6 million and $38.2 million were used to offset against derivative liabilities, respectively, as of December 31, 2020 and 2019.

(5)Represents the fair value of security collateral received and pledged limited to derivative assets and liabilities that are subject to enforceable master netting arrangements or similar agreements. GAAP does not permit the netting of noncash collateral on the consolidated balance sheet but requires disclosure of such amounts.