Derivative Instruments and Hedging Activities

9 Months Ended

Sep. 30, 2024

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments and Hedging Activities

NOTE 12 – Derivative Instruments and Hedging Activities

We manage the interest rate risk associated with our derivative transactions with customers by entering into offsetting positions with other derivative dealers, resulting in a substantially “matched book” portfolio. These interest rate contracts are not designated as hedging instruments for accounting purposes. Credit risk associated with its derivative transactions is managed through a variety of measures, including initial and ongoing periodic underwriting of its counterparties’ creditworthiness, establishment of customer credit limits, and collateral maintenance requirements for customer exposures that exceed certain preset thresholds.

Our policy is not to offset fair value amounts recognized for derivative instruments and fair value amounts recognized for the right to reclaim cash collateral or the obligation to return cash collateral arising from derivative instruments recognized at fair value executed with the same counterparty under master netting arrangements.

The following tables provide the notional values and fair values of our derivative instruments as of September 30, 2024 and December 31, 2023 (in thousands):

	September 30, 2024
	Derivative Assets		Derivative Liabilities		Notional value
Interest rate contracts	$	95,327	$	95,314	$	2,195,110

	December 31, 2023
	Derivative Assets		Derivative Liabilities		Notional value
Interest rate contracts	$	118,668	$	118,651	$	1,994,919

The scheduled maturities of our derivative instruments as of September 30, 2024, are as follows (in thousands):

Within one year	$	219,563
One to three years		780,905
Three to five years		456,562
Five to ten years		662,976
Ten to fifteen years		58,020
Fifteen years and thereafter		17,084
	$	2,195,110

The following table presents the distribution of customer interest rate derivative transactions, by derivative product, as of September 30, 2024 and December 31, 2023 (in thousands):

	September 30, 2024		December 31, 2023
Swaps	$	2,025,110	$	1,824,919
Written options		170,000		170,000
	$	2,195,110	$	1,994,919