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Derivative Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2026

Derivative Financial Instruments

Schedule of changes in fair value of derivatives

Changes in the fair value of derivatives are presented in the following table (in thousands).


		Three Months Ended March 31,
		2026			2025
Increase (decrease) in fair value of derivatives during period:
PrimeLending		$	9,293		$	989
Hilltop Broker-Dealers			(7,950)			4,251
Bank			23			(23)

Schedule of derivative positions

Derivative positions are presented in the following table (in thousands).


		March 31, 2026						December 31, 2025
		Notional			Estimated			Notional			Estimated
		Amount			Fair Value			Amount			Fair Value
Derivative instruments (not designated as hedges):
IRLCs		$	629,457		$	7,163		$	456,734		$	5,997
Commitments to purchase MBSs			1,845,114			(3,903)			1,586,198			7,311
Commitments to sell MBSs			2,712,499			4,062			2,383,043			(6,344)
Interest rate swaps			43,000			1,143			53,470			(666)
Interest rate swaps back-to-back (asset) ⁽¹⁾			116,449			785			110,437			1,495
Interest rate swaps back-to-back (liability) ⁽¹⁾			116,449			(834)			110,437			(1,551)
U.S. Treasury bond futures and options ⁽²⁾			229,700			—			217,220			—
Interest rate and other futures ⁽²⁾			7,800			—			9,250			—
Credit default swaps			—			—			40,000			7

Derivative instruments (designated as hedges):
Interest rate swaps designated as cash flow hedges		$	135,000		$	1,331		$	137,000		$	1,291
Interest rate swaps designated as fair value hedges ⁽³⁾			317,170			24,443			317,335			23,858

(1)

Noted derivative instruments include both customer-facing derivatives as well as offsetting derivatives facing other dealer banks. The fair value of these derivatives include a net credit valuation adjustment that was nominal at March 31, 2026 and December 31, 2025, respectively, reducing the fair value of the liability.

(2)	Noted derivative instruments include contracts between the Hilltop Broker-Dealers and PrimeLending and their respective counterparties with changes in fair value of the contracts that are settled daily.

(3)

The Company designated $317.2 million and $347.3 million as the hedged amount (from a closed portfolio of prepayable available for sale securities and loans held for investment with a carrying value of $292.6 million and $323.4 million as of March 31, 2026 and December 31, 2025, respectively), of which, a subset of these hedges are in portfolio layer hedging relationships. The cumulative basis adjustment included in the carrying value of the hedged items totaled $24.6 million and $24.0 million as of March 31, 2026 and December 31, 2025, respectively.