FAIR VALUE (Tables)

3 Months Ended

Mar. 31, 2024

Fair Value Disclosures [Abstract]

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

The table below presents HTLF's assets and liabilities that are measured at fair value on a recurring basis as of March 31, 2024, and December 31, 2023, in thousands, aggregated by the level in the fair value hierarchy within which those measurements fall:

	Total Fair Value		Level 1		Level 2		Level 3
March 31, 2024
Assets
Securities available for sale
U.S. treasuries	$	32,222	$	32,222	$	—	$	—
U.S. agencies	13,892		—		13,892		—
Obligations of states and political subdivisions	727,491		—		727,491		—
Mortgage-backed securities - agency	1,359,541		—		1,359,541		—
Mortgage-backed securities - non-agency	1,457,798		—		1,457,798		—
Commercial mortgage-backed securities - agency	64,074		—		64,074		—
Commercial mortgage-backed securities - non-agency	426,094		—		426,094		—
Asset-backed securities	197,108		—		197,108		—
Corporate bonds	118,701		—		118,701		—
Equity securities with a readily determinable fair value	21,301		—		21,301		—
Derivative financial instruments(1)	120,460		—		120,460		—
Total assets at fair value	$	4,538,682	$	32,222	$	4,506,460	$	—
Liabilities
Derivative financial instruments(2)	$	69,533	$	—	$	69,533	$	—
Total liabilities at fair value	$	69,533	$	—	$	69,533	$	—
December 31, 2023
Assets
Securities available for sale
U.S. treasuries	$	32,118	$	32,118	$	—	$	—
U.S. agencies	14,530		—		14,530		—
Obligations of states and political subdivisions	741,245		—		741,245		—
Mortgage-backed securities - agency	1,393,629		—		1,393,629		—
Mortgage-backed securities - non-agency	1,529,128		—		1,529,128		—
Commercial mortgage-backed securities - agency	64,788		—		64,788		—
Commercial mortgage-backed securities - non-agency	514,858		—		514,858		—
Asset-backed securities	217,370		—		217,370		—
Corporate bonds	118,169		—		118,169		—
Equity securities with a readily determinable fair value	21,056		—		21,056		—
Derivative financial instruments(1)	84,904		—		84,904		—
Total assets at fair value	$	4,731,795	$	32,118	$	4,699,677	$	—
Liabilities
Derivative financial instruments(2)	$	84,249	$	—	$	84,249	$	—
Total liabilities at fair value	$	84,249	$	—	$	84,249	$	—
(1) Includes interest rate swaps, fair value hedges, embedded derivatives and back-to-back loan swaps.
(2) Includes fair value hedges, back-to-back loan swaps and free standing derivatives.

Fair Value Measurements, Nonrecurring

The tables below present HTLF's assets that are measured at fair value on a nonrecurring basis as of March 31, 2024, and December 31, 2023, in thousands:

	Fair Value Measurements at March 31, 2024
	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)		Year-to- Date (Gains) Losses
Collateral dependent individually assessed loans:
Commercial and industrial	$	22,292	$	—	$	—	$	22,292	$	—
Owner occupied commercial real estate	30,089		—		—		30,089		—
Non-owner occupied commercial real estate	—		—		—		—		—
Real estate construction	642		—		—		642		—
Agricultural and agricultural real estate	4,664		—		—		4,664		—
Residential real estate	727		—		—		727		—
Total collateral dependent individually assessed loans	$	58,414	$	—	$	—	$	58,414	$	—
Loans held for sale	$	352,744	$	—	$	352,744	$	—	$	—
Other real estate owned	2,590		—		—		2,590		539
Premises, furniture and equipment held for sale	16,064		—		—		16,064		7

	Fair Value Measurements at December 31, 2023
	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)		Year-to- Date (Gains) Losses
Collateral dependent individually assessed loans:
Commercial and industrial	$	23,422	$	—	$	—	$	23,422	$	554
Owner occupied commercial real estate	30,400		—		—		30,400		—
Non-owner occupied commercial real estate	—		—		—		—		—
Real estate construction	642		—		—		642		—
Agricultural and agricultural real estate	4,768		—		—		4,768		5,309
Residential real estate	741		—		—		741		—
Total collateral dependent individually assessed loans	$	59,973	$	—	$	—	$	59,973	$	5,863
Loans held for sale	$	5,071	$	—	$	5,071	$	—	$	—
Other real estate owned	12,548		—		—		12,548		2,967
Premises, furniture and equipment held for sale	4,069		—		—		4,069		2,786

Fair Value Inputs, Assets, Quantitative Information

The following tables present additional quantitative information about assets measured at fair value on a recurring and nonrecurring basis and for which HTLF has utilized Level 3 inputs to determine fair value, in thousands:

	Fair Value at 3/31/2024	Valuation Technique	Unobservable Input	Range (Weighted Average)
Other real estate owned	2,590	Modified appraised value	Third party appraisal	(1)
			Appraisal discount	0-10%(2)
Premises, furniture and equipment held for sale	16,064	Modified appraised value	Third party appraisal	(1)
			Appraisal discount	0-10%(2)
Collateral dependent individually assessed loans:
Commercial	22,292	Modified appraised value	Third party appraisal	(1)
			Appraisal discount	0-12%(2)
Owner occupied commercial real estate	30,089	Modified appraised value	Third party appraisal	(1)
			Appraisal discount	0-20%(2)
Non-owner occupied commercial real estate	—	Modified appraised value	Third party appraisal	(1)
			Appraisal discount	0-10%(2)
Real estate construction	642	Modified appraised value	Third party appraisal	(1)
			Appraisal discount	0-10%(2)
Agricultural and agricultural real estate	4,664	Modified appraised value	Third party appraisal	(1)
			Appraisal discount	0-10%(2)
Residential real estate	727	Modified appraised value	Third party appraisal	(1)
			Appraisal discount	0-10%(2)
(1) Third party appraisals are obtained and updated at least annually to establish the value of the underlying asset, but the disclosure of the unobservable inputs used by the appraisers would not be meaningful because the range will vary widely from appraisal to appraisal.
(2) Discounts applied to the appraised values primarily include estimated sales costs, but also consider the age of the appraisal, changes in local market conditions and changes in the current condition of the collateral.

	Fair Value at 12/31/2023	Valuation Technique	Unobservable Input	Range (Weighted Average)
Other real estate owned	2,590	Modified appraised value	Third party appraisal	(1)
			Appraisal discount	0-10%(2)
Premises, furniture and equipment held for sale	16,064	Modified appraised value	Third party appraisal	(1)
			Appraisal discount	0-10%(2)
Collateral dependent individually assessed loans:
Commercial and industrial	23,422	Modified appraised value	Third party appraisal	(1)
			Appraisal discount	0-12%(2)
Owner occupied commercial real estate	30,400	Modified appraised value	Third party appraisal	(1)
			Appraisal discount	0-20%(2)
Non-owner occupied commercial real estate	—	Modified appraised value	Third party appraisal	(1)
			Appraisal discount	0-10%(2)
Real estate construction	642	Modified appraised value	Third party appraisal	(1)
			Appraisal discount	0-10%(2)
Agricultural and agricultural real estate	4,768	Modified appraised value	Third party appraisal	(1)
			Appraisal discount	0-15%(2)
Residential real estate	741	Modified appraised value	Third party appraisal	(1)
			Appraisal discount	0-10%(2)
(1) Third-party appraisals are obtained and updated at least annually to establish the value of the underlying asset, but the disclosure of the unobservable inputs used by the appraisers would not be meaningful because the range will vary widely from appraisal to appraisal.
(2) Discounts applied to the appraised values primarily include estimated sales costs, but also consider the age of the appraisal, changes in local market conditions and changes in the current condition of the collateral.

Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation

Fair Value, by Balance Sheet Grouping

The table below is a summary of the estimated fair value of HTLF's financial instruments (as defined by ASC 825) as of March 31, 2024, and December 31, 2023, in thousands. The carrying amounts in the following tables are recorded in the consolidated balance sheets under the indicated captions. In accordance with ASC 825, the assets and liabilities that are not financial instruments are not included in the disclosure, including the value of premises, furniture and equipment, premises, furniture and equipment held for sale, OREO, goodwill, and other intangibles and other liabilities.

HTLF does not believe that the estimated information presented herein is representative of the earnings power or value of HTLF. The following analysis, which is inherently limited in depicting fair value, also does not consider any value associated with either existing customer relationships or the ability of HTLF to create value through loan origination, deposit gathering or fee generating activities. Many of the estimates presented herein are based upon the use of highly subjective information and assumptions and, accordingly, the results may not be precise. Management believes that fair value estimates may not be comparable between financial institutions due to the wide range of permitted valuation techniques and numerous estimates which must be made. Furthermore, because the disclosed fair value amounts were estimated as of the balance sheet date, the amounts actually realized or paid upon maturity or settlement of the various financial instruments could be significantly different.

					Fair Value Measurements at March 31, 2024
	Carrying Amount		Estimated Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)
Financial assets:
Cash and cash equivalents	$	444,366	$	444,366	$	444,366	$	—	$	—
Time deposits in other financial institutions	1,240		1,240		1,240		—		—
Securities:
Carried at fair value	4,418,222		4,418,222		32,222		4,386,000		—
Held to maturity	841,055		813,752		—		813,752		—
Other investments	68,524		68,524		—		68,524		—
Loans held for sale	352,744		352,744		—		352,744		—
Loans, net:
Commercial and industrial	3,503,946		3,301,416		—		3,279,124		22,292
PPP	2,172		2,172		—		2,172		—
Owner occupied commercial real estate	2,530,638		2,356,849		—		2,326,760		30,089
Non-owner occupied commercial real estate	2,479,298		2,350,454		—		2,350,454		—
Real estate construction	1,006,658		1,002,602		—		1,001,960		642
Agricultural and agricultural real estate	804,768		734,698		—		730,034		4,664
Residential real estate	750,866		654,298		—		653,571		727
Consumer	442,361		424,618		—		424,618		—
Total Loans, net	11,520,707		10,827,107		—		10,768,693		58,414
Cash surrender value on life insurance	197,671		197,671		—		197,671		—
Derivative financial instruments(1)	120,460		120,460		—		120,460		—
Financial liabilities:
Deposits
Demand deposits	4,264,390		4,264,390		—		4,264,390		—
Savings deposits	8,669,221		8,669,221		—		8,669,221		—
Time deposits	2,368,555		2,368,555		—		2,368,555		—
Deposits held for sale	596,328		631,274		—		631,274		—
Borrowings	650,033		650,033		—		650,033		—
Term Debt	372,652		374,240		—		374,240		—
Derivative financial instruments(2)	69,533		69,533		—		69,533		—
(1) Includes interest rate swaps, fair value hedges, embedded derivatives and back-to-back loan swaps.
(2) Includes fair value hedges, back-to-back loan swaps and undesignated interest rate swaps.

					Fair Value Measurements at December 31, 2023
	Carrying Amount		Estimated Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)
Financial assets:
Cash and cash equivalents	$	323,013	$	323,013	$	323,013	$	—	$	—
Time deposits in other financial institutions	1,240		1,240		1,240		—		—
Securities:
Carried at fair value	4,646,891		4,646,891		32,118		4,614,773		—
Held to maturity	838,241		816,399		—		816,399		—
Other investments	91,277		91,277		—		91,277		—
Loans held for sale	5,071		5,071		—		5,071		—
Loans, net:
Commercial and industrial	3,611,368		3,396,628		—		3,373,206		23,422
PPP	2,777		2,777		—		2,777		—
Owner occupied commercial real estate	2,621,019		2,444,540		—		2,414,140		30,400
Non-owner occupied commercial real estate	2,536,462		2,393,931		—		2,393,931		—
Real estate construction	982,943		979,105		—		978,463		642
Agricultural and agricultural real estate	914,892		839,572		—		834,804		4,768
Residential real estate	791,984		687,428		—		686,687		741
Consumer	484,634		465,686		—		465,686		—
Total Loans, net	11,946,079		11,209,667		—		11,149,694		59,973
Cash surrender value on life insurance	197,085		197,085		—		197,085		—
Derivative financial instruments(1)	84,904		84,904		—		84,904		—
Financial liabilities:
Deposits
Demand deposits	4,500,304		4,500,304		—		4,500,304		—
Savings deposits	8,805,597		8,805,597		—		8,805,597		—
Time deposits	2,895,813		2,895,813		—		2,895,813		—
Borrowings	622,255		622,255		—		622,255		—
Term Debt	372,396		374,017		—		374,017		—
Derivative financial instruments(2)	84,249		84,249		—		84,249		—
(1) Includes interest rate swaps, fair value hedges, embedded derivatives and back-to-back loan swaps.
(2) Includes fair value hedges, back-to-back loan swaps and undesignated interest rate swaps.