The Company issues certain financial instruments to meet customer financing needs, including loan commitments, credit lines and letters of credit. The agreements associated with these type of unfunded loan commitments provide credit or support the credit of others, as long as conditions established in the contract are met, and usually have expiration dates.

The same credit and underwriting policies the Company uses to evaluate and underwrite loans are also used to originate unfunded loan commitments, including obtaining collateral at exercise of the commitment. These unfunded loan commitments are only recorded in the consolidated financial statements when drawn upon and many expire without being used. The Company’s maximum off-balance sheet exposure to credit loss from these unfunded loan commitments is represented by the contractual amount of these instruments.


	March 31,		December 31,

	2025		2024
Commitments to extend credit, excluding interest rate lock commitments	$	2,795,637	$	2,770,105
Letters of credit	64,459		69,855
Balance at end of period	$	2,860,096	$	2,839,960

As of March 31, 2025 and December 31, 2024, unfunded loan commitments included above with floating interest rates totaled $2,631,883 and $2,573,218, respectively.

As part of the credit loss process, the Company estimates expected credit losses on its unfunded loan commitments under the CECL methodology. When applying this methodology, the Company considers the likelihood that funding will occur, the contractual period of exposure to credit loss, the risk of loss, historical loss experience, and current conditions along with expectations of future economic conditions.

The table below presents activity within the allowance for credit losses on unfunded loan commitments included in accrued expenses and other liabilities on the Company’s consolidated balance sheets:


	Three Months Ended March 31,
		2025		2024
Balance at beginning of period		$	6,107	$	8,770


Provision for (reversal of) credit losses on unfunded commitments		386		(1,070)
Balance at end of period		$	6,493	$	7,700

In connection with the sale of mortgage loans to third-party private investors or government sponsored agencies, the Company makes representations and warranties as to the propriety of its origination activities, which are typical and customary to these types of transactions. Occasionally, investors require the Company to repurchase loans sold to them

or otherwise indemnify the investor against certain losses under the terms of the warranties. When the Company is required to repurchase the loans, the loans are recorded at fair value in loans HFI. The total principal amount of loans repurchased (or indemnified for) was $1,233 and $2,078 for the three months ended March 31, 2025 and 2024, respectively.

The Company maintains a reserve associated with potential losses on loans previously sold included in accrued expenses and other liabilities on the Company's consolidated balance sheets. The following table summarizes this activity:


	Three Months Ended March 31,
		2025		2024
Balance at beginning of period		$	697	$	899
Provision for loan repurchases or indemnifications		18		50

Losses on loans repurchased or indemnified		(56)		(19)
Balance at end of period		$	659	$	930

Various legal claims arise from time to time in the normal course of business, which, in the opinion of management, will not have a material effect on the Company’s consolidated financial statements.