Accumulated Other Comprehensive Loss ("AOCL")

9 Months Ended

Sep. 30, 2024

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Accumulated Other Comprehensive Loss ("AOCL")

Accumulated Other Comprehensive Loss (“AOCL”)

A summary of changes in AOCL follows:

	Unrealized Losses on Securities AFS		Unrealized Losses on Securities Transferred to Securities HTM (1)		Dispropor- tionate Tax Effects from Securities AFS		Unrealized Gains (Losses) on Derivative Instruments		Total
	(In thousands)
For the three months ended September 30,
2024
Balances at beginning of period	$	(49,482)	$	(14,084)	$	(5,798)	$	(1,464)	$	(70,828)
Other comprehensive income (loss) before reclassifications	9,340		646		—		2,168		12,154
Amounts reclassified from AOCL	114		—		—		308		422
Net current period other comprehensive income (loss)	9,454		646		—		2,476		12,576
Balances at end of period	$	(40,028)	$	(13,438)	$	(5,798)	$	1,012	$	(58,252)
2023
Balances at beginning of period	$	(57,695)	$	(16,811)	$	(5,798)	$	(206)	$	(80,510)
Other comprehensive income (loss) before reclassifications	(12,130)		696		—		(417)		(11,851)
Amounts reclassified from AOCL	—		—		—		57		57
Net current period other comprehensive income (loss)	(12,130)		696		—		(360)		(11,794)
Balances at end of period	$	(69,825)	$	(16,115)	$	(5,798)	$	(566)	$	(92,304)
For the nine months ended September 30,
2024
Balances at beginning of period	$	(51,113)	$	(15,408)	$	(5,798)	$	177	$	(72,142)
Other comprehensive income (loss) before reclassifications	10,758		1,970		—		41		12,769
Amounts reclassified from AOCL	327		—		—		794		1,121
Net current period other comprehensive income (loss)	11,085		1,970		—		835		13,890
Balances at end of period	$	(40,028)	$	(13,438)	$	(5,798)	$	1,012	$	(58,252)
2023
Balances at beginning of period	$	(68,742)	$	(18,223)	$	(5,798)	$	—	$	(92,763)
Other comprehensive income (loss) before reclassifications	(1,258)		2,108		—		(743)		107
Amounts reclassified from AOCL	175		—		—		177		352
Net current period other comprehensive income (loss)	(1,083)		2,108		—		(566)		459
Balances at end of period	$	(69,825)	$	(16,115)	$	(5,798)	$	(566)	$	(92,304)

(1)Represents the remaining unrealized loss to be accreted on securities that were transferred from AFS to HTM on April 1, 2022.

The disproportionate tax effects from securities AFS arose due to tax effects of other comprehensive income (“OCI”) in the presence of a valuation allowance against our deferred tax assets and a pretax loss from operations. Generally, the amount of income tax expense or benefit allocated to operations is determined without regard to the tax effects of other categories of income or loss, such as OCI. However, an exception to the general rule is provided when, in the presence of a valuation allowance against deferred tax assets, there is a pretax loss from operations and pretax income from other categories in the current period. In such instances, income from other categories must offset the current loss from operations, the tax benefit of such offset being reflected in operations. Release of material disproportionate tax effects from other comprehensive income to earnings is done by the portfolio method whereby the effects will remain in AOCL as long as we carry a more than inconsequential portfolio of securities AFS.

A summary of reclassifications out of each component of AOCL for the three months ended September 30 follows:

AOCL Component	Amount Reclassified From AOCL		Affected Line Item in Condensed Consolidated Statements of Operations
	(In thousands)
2024
Unrealized losses on securities available for sale
	$	(145)	Net losses on securities available for sale
	(31)		Income tax expense
	$	(114)	Reclassifications, net of tax
Unrealized gains (losses) on derivative instruments
	$	390	Interest income
	82		Income tax expense
	$	308	Reclassifications, net of tax
	$	(422)	Total reclassifications for the period, net of tax
2023
Unrealized losses on securities available for sale
	$	—	Net losses on securities available for sale
	—		Income tax expense
	$	—	Reclassifications, net of tax
Unrealized gains (losses) on derivative instruments
	$	72	Interest income
	15		Income tax expense
	$	57	Reclassifications, net of tax
	$	(57)	Total reclassifications for the period, net of tax

A summary of reclassifications out of each component of AOCL for the nine months ended September 30 follows:

AOCL Component	Amount Reclassified From AOCL		Affected Line Item in Condensed Consolidated Statements of Operations
	(In thousands)
2024
Unrealized losses on securities available for sale
	$	(414)	Net losses on securities available for sale
	(87)		Income tax expense
	$	(327)	Reclassifications, net of tax
Unrealized gains (losses) on derivative instruments
	$	1,005	Interest income
	211		Income tax expense
	$	794	Reclassifications, net of tax
	$	(1,121)	Total reclassifications for the period, net of tax
2023
Unrealized losses on securities available for sale
	$	(222)	Net losses on securities available for sale
	(47)		Income tax expense
	$	(175)	Reclassifications, net of tax
Unrealized gains (losses) on derivative instruments
	$	224	Interest income
	47		Income tax expense
	$	177	Reclassifications, net of tax
	$	(352)	Total reclassifications for the period, net of tax