Investments in Qualified Affordable Housing Projects

6 Months Ended

Jun. 30, 2024

Investments in Qualified Affordable Housing Projects

Investments in Qualified Affordable Housing Projects

Note 22 — Investments in Qualified Affordable Housing Projects

The Company has investments in qualified affordable housing projects (“QAHPs”) that provide low-income housing tax credits (“LIHTC”) and operating loss benefits over an extended period. Effective January 1, 2024, the Company adopted ASU No. 2023-02 and began to apply the proportional amortization method of accounting for its QAHPs. Prior to the adoption of ASU No. 2023-02, the Company applied the equity method of accounting for its QAHPs. For the three and six months ended June 30, 2024, the Company recorded $3.8 million and $7.7 million, respectively, in tax credits and other tax benefits and $3.5 million and $6.9 million, respectively, of amortization attributable to the QAHPs within Provision for Income Taxes on its Consolidated Statement of Income. For the three and six months ended June 30, 2023, the Company recorded $3.6 million and $7.2 million, respectively, of tax credits and other tax benefits within Provision for Income Taxes and amortization of $2.1 million and $4.1 million, respectively, within Other Noninterest Expense on the Consolidated Statement of Income. At June 30, 2024, and December 31, 2023, the Company’s carrying value of QAHPs was $85.0 million and $101.8 million, respectively, recorded in Other Assets on the Consolidated Balance Sheet. The Company had $11.3 million and $12.5 million in remaining funding obligations related to these QAHPs recorded in Other Liabilities on the Consolidated Balance Sheets at June 30, 2024, and December 31, 2023, respectively. For the remaining funding obligations at June 30, 2024, approximately 91% are expected to be funded by 2026. For more information on the adoption of ASU 2023-02, refer to Recent Accounting and Regulatory Pronouncements under Note 3 — Recent Accounting and Regulatory Pronouncements.