Derivatives and Hedging Activities (Tables)

3 Months Ended

Mar. 31, 2019

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Instruments in Statement of Financial Position

The following table presents the fair value of the Company’s derivative financial instruments as well as their classification on the consolidated balance sheets as of March 31, 2019 and December 31, 2018:

	March 31, 2019						December 31, 2018
	Asset derivatives			Liability derivatives			Asset derivatives			Liability derivatives
	Balance sheet location	Fair value (1)		Balance sheet location	Fair value (1)		Balance sheet location	Fair value (1)		Balance sheet location	Fair value (1)
	(In thousands)
Derivatives designated as hedging instruments:
Interest rate products	Other assets	$	205	Other liabilities	$	—	Other assets	$	553	Other liabilities	$	—
Derivatives not designated as hedging instruments:
Interest rate products	Other assets	23,609		Other liabilities	24,296		Other assets	21,889		Other liabilities	22,385
Risk participation agreements	Other assets	138		Other liabilities	184		Other assets	2		Other liabilities	152
Total		$	23,952		$	24,480		$	22,444		$	22,537

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(1)

For additional details, see Part I. Item 1. “Notes to Unaudited Consolidated Financial Statements - Note 5: Fair Value Measurements”.

Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance

The following table presents the effect of the Company’s derivative financial instruments on accumulated other comprehensive income for the three months ended March 31, 2019 and 2018:

Derivatives in cash flow hedging relationships	Amount of gain or (loss) recognized in OCI on derivatives (1)					Location of (gain) or loss reclassified from accumulated OCI into income	Amount of (gain) or loss reclassified from accumulated OCI into income
	Three months ended March 31,						Three months ended March 31,
	2019			2018			2019			2018
	(In thousands)						(In thousands)
Interest rate products	$	(38	)	$	836	Interest expense	$	(311	)	$	(21	)
Total	$	(38	)	$	836		$	(311	)	$	(21	)

____________________

(1)

The guidance in ASU 2017-12 requires that amounts in accumulated other comprehensive income that are included in the assessment of effectiveness should be reclassified into earnings in the same period in which the hedged forecasted transactions impact earnings. Transition guidance for this ASU further states that upon adoption, previously recorded cumulative ineffectiveness for cash flow hedges existing at the adoption date be eliminated by means of a cumulative-effect adjustment to accumulated other comprehensive income with a corresponding adjustment to the opening balance of retained earnings as of the initial application date. There was a $5 thousand reclassification related to the adoption of ASU 2017-12 effective January 1, 2018.

Schedule of Derivative Instruments, Effect on Other Comprehensive Income (Loss)

The following table presents the effect of the Company’s derivative financial instruments in the consolidated statements of operations for the three months ended March 31, 2019 and 2018:

	Location of (gain) or loss reclassified from accumulated OCI into income	Amount of (gain) or loss recognized in income on cash flow hedging relationships
		Three months ended March 31,
		2019			2018
		(In thousands)
Total amounts of (income) and expense line items presented in the statement of operations in which the effects of fair value or cash flow hedges are recorded	Interest expense	$	(311	)	$	(21	)
The effects of cash flow hedging:
(Gain) or loss on cash flow hedging relationships in ASC 815 Derivatives and Hedging, Subtopic 20 Hedging - general
Interest contracts - amount of (gain) or loss reclassified from accumulated other comprehensive income into income	Interest expense	$	(311	)	$	(21	)

Derivatives Not Designated as Hedging Instrument

The following table presents the effect of the Bank’s derivative financial instruments not designated as hedging instruments in the consolidated statement of operations for the three months ended March 31, 2019 and 2018.

		Amount of gain or (loss), net, recognized in income on derivatives
Derivatives not designated as hedging instruments	Location of gain or (loss) recognized in income on derivatives	Three months ended March 31,
		2019			2018
		(In thousands)
Interest rate products	Other income/ (expense)	$	(191	)	$	92
Risk participation agreements	Other income/ (expense)	104			166
Total		$	(87	)	$	258