Interest Rate Swaps

9 Months Ended

Sep. 30, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Interest Rate Swaps

Interest Rate Swaps

In June 2019, Global Wells entered into a ten years floating-to-fixed interest-rate swap, with an effective date of June 13, 2019, that is based on the prime rate versus a 5.05% fixed rate. The notional value was $21,580,000 as of June 30, 2019. The payment dates are the fifth day of the month beginning July 5, 2019 to the termination date of May 4, 2029. As of September 30, 2021 and December 31, 2020, the fair value of the interest rate swap was $1,549,000 and $2,604,000, respectively, which is reported as other liabilities in the accompanying condensed consolidated balance sheets. For the three months ended September 30, 2021 and 2020, Global Wells recognized approximately $155,000 and $222,000 as interest income, respectively, related to change in fair value of this interest rate swap. For the nine months ended September 30, 2021 and 2020, Global Wells recognized approximately $1,055,000 as interest income and $1,875,000 as interest expense, respectively, related to change in fair value of this interest rate swap.

In June 2019, the Company also entered into a five years floating-to-fixed interest-rate swap, with an effective date of June 3, 2019, that is based on the prime rate versus 5.19% fixed rate. The notional was $10,000,000 as of June 30, 2019. The payment dates are the fifth day of the month beginning July 5, 2019 to the termination date of May 31, 2024. As of September 30, 2021 and December 31, 2020, the fair value of the interest rate swap was $0 and $243,000, respectively, which is reported as other liabilities in the accompanying condensed consolidated balance sheets. For the three months ended September 30, 2021 and 2020, the Company recognized approximately $0 and $48,000 as interest expense, respectively, related to change in fair value of this interest rate swap. For the nine months ended September 30, 2021 and 2020, the Company recognized approximately $47,000 as interest income and $153,000 as interest expense, respectively, related to change in fair value of this interest rate swap. In April 2021, the Company terminated the interest rate swap with a notional amount of $10,000,000, recognizing $196,200 in swap termination fee, which was included in the net interest income recognized in the condensed consolidated statements of income for the nine months ended September 30, 2021.