Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2024 | Aug. 01, 2024 | |
Document Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2024 | |
Document Transition Report | false | |
Securities Act File Number | 001-38258 | |
Entity Registrant Name | MERCHANTS BANCORP | |
Entity Incorporation, State or Country Code | IN | |
Entity Tax Identification Number | 20-5747400 | |
Entity Address, Address Line One | 410 Monon Blvd | |
Entity Address, City or Town | Carmel | |
Entity Address, State or Province | IN | |
Entity Address, Postal Zip Code | 46032 | |
City Area Code | 317 | |
Local Phone Number | 569-7420 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 45,757,567 | |
Entity Central Index Key | 0001629019 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Common Class A [Member] | ||
Document Information | ||
Title of 12(b) Security | Common Stock, without par value | |
Trading Symbol | MBIN | |
Security Exchange Name | NASDAQ | |
Series B Preferred Stock [Member] | ||
Document Information | ||
Title of 12(b) Security | Depositary Shares, each representing a 1/40th interest in a share of Series B Preferred Stock, without par value | |
Trading Symbol | MBINO | |
Security Exchange Name | NASDAQ | |
Series C Preferred Stock [Member] | ||
Document Information | ||
Title of 12(b) Security | Depositary Shares, each representing a 1/40th interest in a share of Series C Preferred Stock, without par value | |
Trading Symbol | MBINN | |
Security Exchange Name | NASDAQ | |
Series D Preferred Stock [Member] | ||
Document Information | ||
Title of 12(b) Security | Depositary Shares, each representing a 1/40th interest in a share of Series D Preferred Stock, without par value | |
Trading Symbol | MBINM | |
Security Exchange Name | NASDAQ |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 | ||
Assets | ||||
Cash and due from banks | $ 10,242 | $ 15,592 | [1] | |
Interest-earning demand accounts | 530,640 | 568,830 | [1] | |
Cash and cash equivalents | 540,882 | 584,422 | [1] | |
Securities purchased under agreements to resell | 3,304 | 3,349 | [1] | |
Mortgage loans in process of securitization | 209,244 | 110,599 | [1] | |
Securities available for sale ($682,774 and $722,497 utilizing fair value option, respectively) | 1,017,019 | 1,113,687 | [1] | |
Securities held to maturity ($1,291,960 and $1,203,535 at fair value, respectively) | 1,291,110 | 1,204,217 | [1] | |
Federal Home Loan Bank (FHLB) stock | 67,499 | 48,578 | [1] | |
Loans held for sale (includes $102,873 and $86,663 at fair value, respectively) | 3,483,076 | 3,144,756 | [1] | |
Loans receivable, net of allowance for credit losses on loans of $81,028 and $71,752, respectively | 10,933,189 | 10,127,801 | [1] | |
Premises and equipment, net | 46,833 | 42,342 | [1] | |
Servicing rights | 178,776 | 158,457 | [1] | |
Interest receivable | 90,360 | 91,346 | [1] | |
Goodwill | 8,014 | 15,845 | [1] | |
Other assets and receivables | 343,116 | 307,117 | [1] | |
Total assets | 18,212,422 | 16,952,516 | [1] | |
Deposits | ||||
Noninterest-bearing | 383,260 | 520,070 | [1] | |
Interest-bearing | 14,533,807 | 13,541,390 | [1] | |
Total deposits | 14,917,067 | 14,061,460 | [1] | |
Borrowings | 1,159,206 | 964,127 | [1] | |
Deferred and current tax liabilities, net | 25,098 | 19,923 | [1] | |
Other liabilities | 222,904 | 205,922 | [1] | |
Total liabilities | 16,324,275 | 15,251,432 | [1] | |
Commitments and Contingencies | [1] | |||
Shareholders' Equity | ||||
Common stock, without par value Authorized - 75,000,000 shares Issued and outstanding - 45,757,567 shares at June 30, 2024 and 43,242,928 shares at December 31, 2023 | 238,492 | 140,365 | [1] | |
Retained earnings | 1,200,778 | 1,063,599 | [1] | |
Accumulated other comprehensive loss | (510) | (2,488) | [1] | |
Total shareholders' equity | 1,888,147 | 1,701,084 | [1] | |
Total liabilities and shareholders' equity | 18,212,422 | 16,952,516 | [1] | |
7% Series A Preferred Stock | ||||
Shareholders' Equity | ||||
Preferred stock | [1] | 50,221 | ||
6% Series B Preferred Stock | ||||
Shareholders' Equity | ||||
Preferred stock | 120,844 | 120,844 | [1] | |
6% Series C Preferred Stock | ||||
Shareholders' Equity | ||||
Preferred stock | 191,084 | 191,084 | [1] | |
8.25% Series D Preferred Stock | ||||
Shareholders' Equity | ||||
Preferred stock | $ 137,459 | $ 137,459 | [1] | |
[1] *Derived from audited consolidated financial statements |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2024 | Dec. 31, 2023 | |
Securities available for sale | $ 682,774 | $ 722,497 |
Securities held to maturity, fair value | 1,291,960 | 1,203,535 |
Loans held for sale at fair value | 102,873 | 86,663 |
Net of allowance for credit losses on loans | $ 81,028 | $ 71,752 |
Stockholders' Equity: | ||
Common stock, shares authorized | 75,000,000 | 75,000,000 |
Common stock, shares issued | 45,757,567 | 43,242,928 |
Common stock, shares outstanding | 45,757,567 | 43,242,928 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
7% Series A Preferred Stock | ||
Stockholders' Equity: | ||
Preferred stock, dividend rate (as a percent) | 7% | 7% |
Preferred stock liquidation preference (in dollars per share) | $ 25 | $ 25 |
Preferred stock, shares authorized | 0 | 3,500,000 |
Preferred stock, shares issued | 0 | 2,081,800 |
Preferred stock, shares outstanding | 0 | 2,081,800 |
6% Series B Preferred Stock | ||
Stockholders' Equity: | ||
Preferred stock, dividend rate (as a percent) | 6% | 6% |
Preferred stock liquidation preference (in dollars per share) | $ 1,000 | $ 1,000 |
Preferred stock, shares authorized | 125,000 | 125,000 |
Preferred stock, shares issued | 125,000 | 125,000 |
Preferred stock, shares outstanding | 125,000 | 125,000 |
Depositary shares | 5,000,000 | 5,000,000 |
6% Series C Preferred Stock | ||
Stockholders' Equity: | ||
Preferred stock, dividend rate (as a percent) | 6% | 6% |
Preferred stock liquidation preference (in dollars per share) | $ 1,000 | $ 1,000 |
Preferred stock, shares authorized | 200,000 | 200,000 |
Preferred stock, shares issued | 196,181 | 196,181 |
Preferred stock, shares outstanding | 196,181 | 196,181 |
Depositary shares | 7,847,233 | 7,847,233 |
8.25% Series D Preferred Stock | ||
Stockholders' Equity: | ||
Preferred stock, dividend rate (as a percent) | 8.25% | 8.25% |
Preferred stock liquidation preference (in dollars per share) | $ 1,000 | $ 1,000 |
Preferred stock, shares authorized | 300,000 | 300,000 |
Preferred stock, shares issued | 142,500 | 142,500 |
Preferred stock, shares outstanding | 142,500 | 142,500 |
Depositary shares | 5,700,000 | 5,700,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Interest Income | ||||
Loans | $ 284,421,000 | $ 228,732,000 | $ 556,419,000 | $ 418,182,000 |
Mortgage loans in process of securitization | 3,044,000 | 3,127,000 | 4,764,000 | 4,775,000 |
Investment securities: | ||||
Available for sale | 14,784,000 | 5,564,000 | 29,172,000 | 7,830,000 |
Held to maturity | 19,799,000 | 17,311,000 | 40,321,000 | 33,065,000 |
Federal Home Loan Bank stock | 1,277,000 | 471,000 | 2,121,000 | 898,000 |
Other | 4,948,000 | 2,864,000 | 9,649,000 | 4,613,000 |
Total interest income | 328,273,000 | 258,069,000 | 642,446,000 | 469,363,000 |
Interest Expense | ||||
Deposits | 179,651,000 | 137,801,000 | 350,673,000 | 242,243,000 |
Borrowed funds | 20,503,000 | 14,651,000 | 36,598,000 | 20,810,000 |
Total interest expense | 200,154,000 | 152,452,000 | 387,271,000 | 263,053,000 |
Net Interest Income | 128,119,000 | 105,617,000 | 255,175,000 | 206,310,000 |
Provision for credit losses | 9,965,000 | 22,603,000 | 14,691,000 | 29,470,000 |
Net Interest Income After Provision for Credit Losses | 118,154,000 | 83,014,000 | 240,484,000 | 176,840,000 |
Noninterest Income | ||||
Gain on sale of loans | 11,168,000 | 11,350,000 | 20,524,000 | 18,083,000 |
Loan servicing fees, net | 10,827,000 | 8,616,000 | 30,229,000 | 10,976,000 |
Mortgage warehouse fees | 1,524,000 | 2,865,000 | 2,506,000 | 3,893,000 |
Loss on sale of investments available for sale (includes $0, $0, $(108) and $0, respectively, related to accumulated other comprehensive loss reclassifications) | (108,000) | |||
Syndication and asset management fees | 3,233,000 | 3,896,000 | 8,536,000 | 5,108,000 |
Other income | 4,599,000 | 3,155,000 | 10,538,000 | 6,086,000 |
Total noninterest income | 31,351,000 | 29,882,000 | 72,225,000 | 44,146,000 |
Noninterest Expense | ||||
Salaries and employee benefits | 28,373,000 | 25,724,000 | 57,969,000 | 47,870,000 |
Loan expenses | 993,000 | 907,000 | 1,949,000 | 1,711,000 |
Occupancy and equipment | 2,239,000 | 2,456,000 | 4,476,000 | 4,688,000 |
Professional fees | 3,556,000 | 3,723,000 | 7,655,000 | 5,992,000 |
Deposit insurance expense | 5,579,000 | 3,806,000 | 10,704,000 | 5,984,000 |
Technology expense | 1,859,000 | 1,571,000 | 3,713,000 | 3,148,000 |
Other expense | 7,781,000 | 6,133,000 | 12,826,000 | 9,699,000 |
Total noninterest expense | 50,380,000 | 44,320,000 | 99,292,000 | 79,092,000 |
Income Before Income Taxes | 99,125,000 | 68,576,000 | 213,417,000 | 141,894,000 |
Provision for income taxes (includes $0, $0, $26 and $0, respectively, related to income tax benefit for reclassification items) | 22,732,000 | 3,274,000 | 49,970,000 | 21,637,000 |
Net Income | 76,393,000 | 65,302,000 | 163,447,000 | 120,257,000 |
Dividends on preferred stock | (7,757,000) | (8,668,000) | (16,424,000) | (17,335,000) |
Impact of preferred stock redemption | (1,823,000) | (1,823,000) | ||
Net Income Available to Common Shareholders | $ 66,813,000 | $ 56,634,000 | $ 145,200,000 | $ 102,922,000 |
Basic Earnings Per Share (in dollars per share) | $ 1.50 | $ 1.31 | $ 3.30 | $ 2.38 |
Diluted Earnings Per Share (in dollars per share) | $ 1.49 | $ 1.31 | $ 3.29 | $ 2.38 |
Weighted-Average Shares Outstanding | ||||
Basic (in shares) | 44,569,345 | 43,235,398 | 43,937,665 | 43,207,655 |
Diluted (in shares) | 44,698,324 | 43,309,393 | 44,082,485 | 43,300,240 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Income (Unaudited) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Condensed Consolidated Statements of Income (Unaudited) | ||||
Reclassifications included in gains on sale of investment available for sale | $ 0 | $ 0 | $ (108) | $ 0 |
Provision for income taxes related to income tax expense for reclassification items | $ 0 | $ 0 | $ 26 | $ 0 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Condensed Consolidated Statements of Comprehensive Income (Unaudited) | ||||
Net Income | $ 76,393 | $ 65,302 | $ 163,447 | $ 120,257 |
Other Comprehensive Income: | ||||
Net unrealized gain on investment securities available for sale, net of tax expense of $(209), $(402), $(593) and $(1,336), respectively | 663 | 693 | 1,896 | 3,485 |
Add: Reclassification adjustment for losses included in net income, net of tax benefit of $0, $0, $26 and $0, respectively | 82 | |||
Other comprehensive income for the period | 663 | 693 | 1,978 | 3,485 |
Comprehensive Income | $ 77,056 | $ 65,995 | $ 165,425 | $ 123,742 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Comprehensive Income (Unaudited) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Condensed Consolidated Statements of Comprehensive Income (Unaudited) | ||||
Net of tax (expense)/ benefits on net change in unrealized gains/(losses) on investment securities available for sale | $ (209) | $ (402) | $ (593) | $ (1,336) |
Net of tax expense on reclassification adjustment for gains include in net income | $ 0 | $ 0 | $ 26 | $ 0 |
Condensed Consolidated Statem_5
Condensed Consolidated Statement of Shareholders' Equity (Unaudited) - USD ($) $ in Thousands | Common stock | Preferred stock 7% Series A Preferred Stock | Preferred stock 6% Series B Preferred Stock | Preferred stock 6% Series C Preferred Stock | Preferred stock 8.25% Series D Preferred Stock | Retained Earnings | Accumulated Other Comprehensive Loss | Total | |
Balance beginning of period at Dec. 31, 2022 | $ 137,781 | $ 50,221 | $ 120,844 | $ 191,084 | $ 137,459 | $ 832,871 | $ (10,521) | ||
Balance beginning of period (in shares) at Dec. 31, 2022 | 43,113,127 | 2,081,800 | 125,000 | 196,181 | 142,500 | ||||
Consolidated Statements of Shareholders' Equity | |||||||||
Distribution to employee stock ownership plan | $ 810 | ||||||||
Distribution to employee stock ownership plan (in shares) | 33,293 | ||||||||
Shares issued for stock compensation plans, net of taxes withheld to satisfy tax obligations | $ 262 | ||||||||
Shares issued for stock compensation plans, net of taxes withheld to satisfy tax obligations (in shares) | 90,880 | ||||||||
Net Income | 120,257 | $ 120,257 | |||||||
Dividends on 7% Series A preferred stock, $1.75 per share, annually | (1,821) | ||||||||
Dividends on 6% Series B preferred stock, $60.00 per share, annually | (3,750) | ||||||||
Dividends on 6% Series C preferred stock, $60.00 per share, annually | (5,886) | ||||||||
Dividends on 8.25% Series D preferred stock, $82.50 per share, annually | (5,878) | ||||||||
Dividends on common stock, $0.36 per share, annually in 2024 and $0.32 per share, annually in 2023 | (6,918) | ||||||||
Other comprehensive income | 3,485 | 3,485 | |||||||
Balance end of period at Jun. 30, 2023 | $ 138,853 | $ 50,221 | $ 120,844 | $ 191,084 | $ 137,459 | 928,875 | (7,036) | 1,560,300 | |
Balance end of period (in shares) at Jun. 30, 2023 | 43,237,300 | 2,081,800 | 125,000 | 196,181 | 142,500 | ||||
Balance beginning of period at Mar. 31, 2023 | $ 138,105 | $ 50,221 | $ 120,844 | $ 191,084 | $ 137,459 | 875,700 | (7,729) | ||
Balance beginning of period (in shares) at Mar. 31, 2023 | 43,233,618 | 2,081,800 | 125,000 | 196,181 | 142,500 | ||||
Consolidated Statements of Shareholders' Equity | |||||||||
Shares issued for stock compensation plans, net of taxes withheld to satisfy tax obligations | $ 748 | ||||||||
Shares issued for stock compensation plans, net of taxes withheld to satisfy tax obligations (in shares) | 3,682 | ||||||||
Net Income | 65,302 | 65,302 | |||||||
Dividends on 7% Series A preferred stock, $1.75 per share, annually | (911) | ||||||||
Dividends on 6% Series B preferred stock, $60.00 per share, annually | (1,875) | ||||||||
Dividends on 6% Series C preferred stock, $60.00 per share, annually | (2,943) | ||||||||
Dividends on 8.25% Series D preferred stock, $82.50 per share, annually | (2,939) | ||||||||
Dividends on common stock, $0.36 per share, annually in 2024 and $0.32 per share, annually in 2023 | (3,459) | ||||||||
Other comprehensive income | 693 | 693 | |||||||
Balance end of period at Jun. 30, 2023 | $ 138,853 | $ 50,221 | $ 120,844 | $ 191,084 | $ 137,459 | 928,875 | (7,036) | 1,560,300 | |
Balance end of period (in shares) at Jun. 30, 2023 | 43,237,300 | 2,081,800 | 125,000 | 196,181 | 142,500 | ||||
Balance beginning of period at Dec. 31, 2023 | $ 140,365 | $ 50,221 | $ 120,844 | $ 191,084 | $ 137,459 | 1,063,599 | (2,488) | 1,701,084 | [1] |
Balance beginning of period (in shares) at Dec. 31, 2023 | 43,242,928 | 2,081,800 | 125,000 | 196,181 | 142,500 | ||||
Consolidated Statements of Shareholders' Equity | |||||||||
Distribution to employee stock ownership plan | $ 997 | ||||||||
Distribution to employee stock ownership plan (in shares) | 23,414 | ||||||||
Issuance of common stock, net of $5.5 million in offering expenses | $ 97,655 | ||||||||
Issuance of common stock, net of $5.5 million in offering expenses (in shares) | 2,400,000 | ||||||||
Shares issued for stock compensation plans, net of taxes withheld to satisfy tax obligations | $ (525) | ||||||||
Shares issued for stock compensation plans, net of taxes withheld to satisfy tax obligations (in shares) | 91,225 | ||||||||
Net Income | 163,447 | 163,447 | |||||||
Dividends on 7% Series A preferred stock, $1.75 per share, annually | (910) | ||||||||
Dividends on 6% Series B preferred stock, $60.00 per share, annually | (3,750) | ||||||||
Dividends on 6% Series C preferred stock, $60.00 per share, annually | (5,886) | ||||||||
Dividends on 8.25% Series D preferred stock, $82.50 per share, annually | (5,878) | ||||||||
Dividends on common stock, $0.36 per share, annually in 2024 and $0.32 per share, annually in 2023 | (8,021) | ||||||||
Other comprehensive income | 1,978 | 1,978 | |||||||
Redemption of 7% Series A preferred stock | $ (50,221) | (1,823) | |||||||
Redemption of 7% Series A preferred stock (in shares) | (2,081,800) | ||||||||
Balance end of period at Jun. 30, 2024 | $ 238,492 | $ 120,844 | $ 191,084 | $ 137,459 | 1,200,778 | (510) | 1,888,147 | ||
Balance end of period (in shares) at Jun. 30, 2024 | 45,757,567 | 125,000 | 196,181 | 142,500 | |||||
Balance beginning of period at Mar. 31, 2024 | $ 139,950 | $ 50,221 | $ 120,844 | $ 191,084 | $ 137,459 | 1,138,083 | (1,173) | ||
Balance beginning of period (in shares) at Mar. 31, 2024 | 43,354,718 | 2,081,800 | 125,000 | 196,181 | 142,500 | ||||
Consolidated Statements of Shareholders' Equity | |||||||||
Issuance of common stock, net of $5.5 million in offering expenses | $ 97,655 | ||||||||
Issuance of common stock, net of $5.5 million in offering expenses (in shares) | 2,400,000 | ||||||||
Shares issued for stock compensation plans, net of taxes withheld to satisfy tax obligations | $ 887 | ||||||||
Shares issued for stock compensation plans, net of taxes withheld to satisfy tax obligations (in shares) | 2,849 | ||||||||
Net Income | 76,393 | 76,393 | |||||||
Dividends on 6% Series B preferred stock, $60.00 per share, annually | (1,875) | ||||||||
Dividends on 6% Series C preferred stock, $60.00 per share, annually | (2,943) | ||||||||
Dividends on 8.25% Series D preferred stock, $82.50 per share, annually | (2,939) | ||||||||
Dividends on common stock, $0.36 per share, annually in 2024 and $0.32 per share, annually in 2023 | (4,118) | ||||||||
Other comprehensive income | 663 | 663 | |||||||
Redemption of 7% Series A preferred stock | $ (50,221) | (1,823) | |||||||
Redemption of 7% Series A preferred stock (in shares) | (2,081,800) | ||||||||
Balance end of period at Jun. 30, 2024 | $ 238,492 | $ 120,844 | $ 191,084 | $ 137,459 | $ 1,200,778 | $ (510) | $ 1,888,147 | ||
Balance end of period (in shares) at Jun. 30, 2024 | 45,757,567 | 125,000 | 196,181 | 142,500 | |||||
[1] *Derived from audited consolidated financial statements |
Condensed Consolidated Statem_6
Condensed Consolidated Statement of Shareholders' Equity (Unaudited) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Dividends on common stock per share | $ 0.36 | $ 0.32 | $ 0.36 | $ 0.32 |
Offering expenses | $ 5.5 | $ 5.5 | $ 5.5 | $ 5.5 |
7% Series A Preferred Stock | ||||
Preferred stock, dividend rate (as a percent) | 7% | |||
Dividends on preferred stock per share | $ 1.75 | $ 1.75 | $ 1.75 | $ 1.75 |
7% Series A Preferred Stock | Preferred stock | ||||
Preferred stock, dividend rate (as a percent) | 7% | 7% | 7% | 7% |
6% Series B Preferred Stock | ||||
Preferred stock, dividend rate (as a percent) | 6% | |||
Dividends on preferred stock per share | $ 60 | $ 60 | $ 60 | $ 60 |
6% Series B Preferred Stock | Preferred stock | ||||
Preferred stock, dividend rate (as a percent) | 6% | 6% | 6% | 6% |
6% Series C Preferred Stock | ||||
Preferred stock, dividend rate (as a percent) | 6% | |||
Dividends on preferred stock per share | $ 60 | $ 60 | $ 60 | $ 60 |
6% Series C Preferred Stock | Preferred stock | ||||
Preferred stock, dividend rate (as a percent) | 6% | 6% | 6% | 6% |
8.25% Series D Preferred Stock | ||||
Preferred stock, dividend rate (as a percent) | 8.25% | |||
Dividends on preferred stock per share | $ 82.50 | $ 82.50 | $ 82.50 | $ 82.50 |
8.25% Series D Preferred Stock | Preferred stock | ||||
Preferred stock, dividend rate (as a percent) | 8.25% | 8.25% | 8.25% | 8.25% |
Condensed Consolidated Statem_7
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | ||
Operating activities: | |||
Net income | $ 163,447,000 | $ 120,257,000 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation | 1,471,000 | 1,385,000 | |
Provision for credit losses | 14,691,000 | 29,470,000 | |
Loss on sale of securities | 108,000 | ||
Gain on sale of loans | (20,524,000) | (18,083,000) | |
Proceeds from sales of loans | 11,889,091,000 | 8,388,537,000 | |
Loans and participations originated and purchased for sale | (12,260,927,000) | (8,900,738,000) | |
Proceeds from sale of low-income housing tax credits | 27,564,000 | 19,804,000 | |
Purchases of low-income housing tax credits for sale | (32,106,000) | (30,117,000) | |
Change in servicing rights for paydowns and fair value adjustments | (14,392,000) | 3,257,000 | |
Net change in: | |||
Mortgage loans in process of securitization | (98,645,000) | (144,713,000) | |
Other assets and receivables | (8,493,000) | (37,233,000) | |
Other liabilities | 5,592,000 | 28,294,000 | |
Other | 470,000 | (3,140,000) | |
Net cash used in operating activities | (332,653,000) | (543,020,000) | |
Investing activities: | |||
Net change in securities purchased under agreements to resell | 45,000 | 52,000 | |
Purchases of securities available for sale | (302,783,000) | (513,520,000) | |
Purchases of securities held to maturity | (155,268,000) | (4,261,000) | |
Proceeds from the sale of securities available for sale | 9,983,000 | 132,000 | |
Proceeds from calls, maturities and paydowns of securities available for sale | 382,840,000 | 195,164,000 | |
Proceeds from calls, maturities and paydowns of securities held to maturity | 68,376,000 | 61,322,000 | |
Purchases of loans | (68,468,000) | (269,855,000) | |
Net change in loans receivable | (745,744,000) | (1,805,415,000) | |
Proceeds from loans held for sale previously classified as loans receivable | 1,600,000 | ||
Purchase of FHLB stock | (19,316,000) | ||
Proceeds from sale of FHLB stock | 395,000 | ||
Purchases of premises and equipment | (7,590,000) | (2,943,000) | |
Purchase of limited partnership interests | (10,488,000) | (71,001,000) | |
Proceeds from sale of limited partnership interests | 52,458,000 | ||
Net cash paid on sale of branches | (170,594,000) | ||
Other investing activities | 4,839,000 | 1,322,000 | |
Net cash used in investing activities | (1,012,173,000) | (2,356,545,000) | |
Financing activities: | |||
Net change in deposits | 1,085,442,000 | 2,988,519,000 | |
Proceeds from borrowings | 47,606,878,000 | 42,149,880,000 | |
Repayment of borrowings | (47,404,262,000) | (42,240,205,000) | |
Proceeds from notes payable | 3,592,000 | 26,000,000 | |
Proceeds from issuance of common stock | 97,655,000 | ||
Proceeds from credit linked notes | 153,546,000 | ||
Payment of credit linked notes | (11,529,000) | (2,980,000) | |
Repurchase of preferred stock | (52,045,000) | ||
Dividends | (24,445,000) | (24,253,000) | |
Other financing activities | 204,000 | ||
Net cash provided by financing activities | 1,301,286,000 | 3,050,711,000 | |
Net Change in Cash and Cash Equivalents | (43,540,000) | 151,146,000 | |
Cash and Cash Equivalents, Beginning of Period | 584,422,000 | [1] | 226,164,000 |
Cash and Cash Equivalents, End of Period | 540,882,000 | 377,310,000 | |
Supplemental Cash Flows Information: | |||
Interest paid | 371,467,000 | 238,521,000 | |
Income taxes paid, net of refunds | 46,043,000 | 29,813,000 | |
Change in ROU assets due to lease renegotiation | (1,063,000) | ||
Transfer of loans from loans held for sale to loans receivable | 47,850,000 | $ 377,460,000 | |
Transfer of loans from loans receivable to loans held for sale | $ 1,600,000 | ||
[1] *Derived from audited consolidated financial statements |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 30, 2024 | |
Basis of Presentation | |
Basis of Presentation | Note 1: Basis of Presentation The accompanying unaudited condensed consolidated financial statements include the accounts of Merchants Bancorp, a registered bank holding company (the “Company”) and its wholly owned subsidiaries, Merchants Bank of Indiana (“Merchants Bank”), Farmers-Merchants Bank of Illinois (“FMBI”) (whose branches were sold to unaffiliated third parties and its remaining charter collapsed into Merchants Bank on January 26, 2024), and Merchants Asset Management, LLC (“MAM”). Merchants Bank’s primary operating subsidiaries include Merchants Capital Corp. (‘MCC”), Merchants Capital Servicing, LLC (“MCS”), and Merchants Capital Investments, LLC (“MCI”). All direct and indirectly owned subsidiaries owned by Merchants Bancorp are collectively referred to as the “Company”. The accompanying unaudited condensed consolidated balance sheet of the Company as of December 31, 2023, which has been derived from audited financial statements, and unaudited condensed consolidated financial statements of the Company as of June 30, 2024 and for the three and six months ended June 30, 2024 and 2023, were prepared in accordance with the instructions for Form 10-Q and Article 10 of Regulation S-X and, therefore, do not include information or footnotes necessary for a complete presentation of financial position, results of operations and cash flows in conformity with accounting principles generally accepted in the United States of America. Accordingly, these unaudited condensed financial statements should be read in conjunction with the audited financial statements and notes thereto of the Company as of and for the year ended December 31, 2023 in its Annual Report on Form 10-K. Reference is made to the accounting policies of the Company described in the Notes to the Financial Statements contained in the Annual Report on Form 10-K. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) which are necessary for a fair presentation of the unaudited financial statements have been included to present fairly the financial position as of June 30, 2024 and the results of operations for the three and six months ended June 30, 2024 and 2023, and cash flows for the six months ended June 30, 2024 and 2023. All interim amounts have not been audited and the results of operations for the three and six months ended June 30, 2024, herein are not necessarily indicative of the results of operations to be expected for the entire year. Sale of Farmers-Merchants Bank of Illinois branches On September 7, 2023, the Company entered into an agreement with Bank of Pontiac to sell its Farmers-Merchants Bank of Illinois branch locations in Paxton, Melvin, and Piper City, Illinois, and into an agreement with CBI Bank & Trust, to sell its Farmers-Merchants Bank of Illinois branch located in Joy, Illinois. This transaction enhanced the Company’s ability to focus on its core business of single and multi-family mortgage lending and strategically aligned the branches with institutions that share a similar business model and allowed them to provide additional products to their customers. On January 26, 2024, the transaction was completed after having met customary closing conditions, including regulatory approval. In addition to the branches, Bank of Pontiac acquired approximately $164.8 million in deposits and $19.2 million in loans, and CBI Bank & Trust acquired approximately $65.1 million in deposits and $28.6 million in loans. Total assets and liabilities of approximately $60.8 million and $230.6 million, respectively, were sold. A net gain of $715,000 was recognized from the transactions, which includes a $10.1 million deposit premium and the extinguishment of $7.8 million in goodwill and $0.5 million in intangibles during the first quarter of 2024. Principles of Consolidation The unaudited condensed consolidated financial statements as of and for the period ended June 30, 2024 and 2023 include results from the Company, and its wholly owned subsidiaries, Merchants Bank, FMBI (until its branches were sold and its bank charter merged into Merchants Bank on January 26, 2024), and MAM. Also included are Merchants Bank’s primary operating subsidiaries, MCC, MCS, and MCI, as well as all direct and indirectly owned subsidiaries owned by Merchants Bancorp. During 2022, Merchants Foundation, Inc., a nonprofit corporation, was incorporated and its results are consolidated with the Company’s consolidated financial statements in all periods presented. In addition, when the Company makes an equity investment in or has a relationship with an entity for which it holds a variable interest, it is evaluated for consolidation requirements under Accounting Standards Update (“ASU”) Topic 810. Accordingly, the Company assesses the entities for potential consolidation as a variable interest entity (“VIE”) and would only consolidate those entities for which it is a primary beneficiary. A primary beneficiary is defined as the party that has both the power to direct the activities that most significantly impact the entity, and an interest that could be significant to the entity. To determine if an interest could be significant to the entity, both qualitative and quantitative factors regarding the nature, size and form of the Company’s involvement with the entity are evaluated. Alternatively, under the voting interest model, it would only consolidate those entities for which it has a controlling interest. In May 2023, the Company acquired a variable interest in an investment for which it is the primary beneficiary of, and its results have been consolidated since the date of acquisition. Additionally, the Company has certain variable interest investments that it was deemed not to be a primary beneficiary of as of June 30, 2024 and December 31, 2023. These VIEs are not consolidated and the equity or proportional method of accounting has been applied. The Company will analyze whether the primary beneficiary designation has changed through triggering events on a prospective basis. Changes in facts and circumstances occurring since the previous primary beneficiary determination will be considered as part of this ongoing assessment. See Note 5: Variable Interest Entities (VIEs) for additional information about VIEs. All significant intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for credit losses on loans and fair values of servicing rights and financial instruments. Significant Accounting Policies The significant accounting policies followed by the Company for interim financial reporting are consistent with the accounting policies followed for annual financial reporting. For additional information regarding significant accounting policies, see the Company’s 2023 Annual Report on Form 10–K . Restricted Cash Included in cash equivalents is an account restricted as collateral for the potential risk of loss on senior credit linked notes issued by the Company. The balance of the notes as of June 30, 2024 was $112.3 million. As of June 30, 2024, there was $37.0 million in restricted cash held in a separate account included in the total of interest-earning demand accounts on the Balance Sheet. Also see Note 11: Borrowings . |
Investment Securities
Investment Securities | 6 Months Ended |
Jun. 30, 2024 | |
Investment Securities | |
Investment Securities | Note 2: Investment Securities The amortized cost and approximate fair values, together with gross unrealized gains and losses, of securities available for sale and held to maturity were as follows: June 30, 2024 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value (In thousands) Securities available for sale: Treasury notes $ 109,067 $ 12 $ — $ 109,079 Federal agencies 220,000 1 683 219,318 Mortgage-backed - Government Agency ("Agency") (2) 5,848 — — 5,848 Mortgage-backed - Non-Agency residential - fair value option (1) 462,627 — — 462,627 Mortgage-backed - Agency - residential - fair value option (1) 220,147 — — 220,147 Total securities available for sale $ 1,017,689 $ 13 $ 683 $ 1,017,019 Securities held to maturity: Mortgage-backed - Non-Agency - multi-family $ 689,249 $ — $ 524 $ 688,725 Mortgage-backed - Non-Agency - residential 589,925 2,397 81 592,241 Mortgage-backed - Agency 11,936 — 942 10,994 Total securities held to maturity $ 1,291,110 $ 2,397 $ 1,547 $ 1,291,960 (1) Fair value option securities represent securities which the Company has elected to carry at fair value with changes in the fair value recognized in earnings as they occur. (2) Agency includes government sponsored agencies, such as Federal National Mortgage Association (“Fannie Mae”), Federal Home Loan Mortgage Corporation (“Freddie Mac”), and Government National Mortgage Association (“Ginnie Mae”). December 31, 2023 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value (In thousands) Securities available for sale: Treasury notes $ 129,261 $ 45 $ 338 $ 128,968 Federal agencies 250,731 — 2,976 247,755 Mortgage-backed - Government Agency ("Agency") (2) 14,465 5 3 14,467 Mortgage-backed - Non-Agency residential - fair value option (1) 485,500 — — 485,500 Mortgage-backed - Agency - residential - fair value option (1) 236,997 — — 236,997 Total securities available for sale $ 1,116,954 $ 50 $ 3,317 $ 1,113,687 Securities held to maturity: Mortgage-backed - Non-Agency - multi-family $ 719,662 $ — $ 415 $ 719,247 Mortgage-backed - Non-Agency - residential 472,539 973 418 473,094 Mortgage-backed - Agency 12,016 — 822 11,194 Total securities held to maturity $ 1,204,217 $ 973 $ 1,655 $ 1,203,535 (1) Fair value option securities represent securities which the Company has elected to carry at fair value with changes in the fair value recognized in earnings as they occur. (2) Agency includes government sponsored agencies, such as Fannie Mae, Freddie Mac, and Ginnie Mae. Accrued interest on securities available for sale totaled $5.9 million at June 30, 2024 and $6.7 million at December 31, 2023, respectively, and is excluded from the estimate of credit losses. Accrued interest on securities held to maturity totaled $6.2 million at June 30, 2024 and $5.8 million at December 31, 2023, respectively, and is excluded from the estimate of credit losses. The amortized cost and fair value of securities available for sale at June 30, 2024 and December 31, 2023, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date are shown separately. June 30, 2024 December 31, 2023 Amortized Fair Amortized Fair Cost Value Cost Value Securities available for sale: (In thousands) Within one year $ 189,067 $ 188,522 $ 308,474 $ 305,406 After one through five years 140,000 139,875 71,518 71,317 329,067 328,397 379,992 376,723 Mortgage-backed - Agency 5,848 5,848 14,465 14,467 Mortgage-backed - Non-Agency residential - fair value option 462,627 462,627 485,500 485,500 Mortgage-backed - Agency - residential - fair value option 220,147 220,147 236,997 236,997 $ 1,017,689 $ 1,017,019 $ 1,116,954 $ 1,113,687 Securities held to maturity: Mortgage-backed - Non-Agency - multi-family $ 689,249 $ 688,725 $ 719,662 $ 719,247 Mortgage-backed - Non-Agency - residential 589,925 592,241 472,539 473,094 Mortgage-backed - Agency 11,936 10,994 12,016 11,194 $ 1,291,110 $ 1,291,960 $ 1,204,217 $ 1,203,535 During the three months ended June 30, 2024, no securities available for sale were sold. During the six months ended June 30, 2024, the Company received proceeds of $10.0 million and recognized a net loss of $108,000 from sales of securities available for sale. The $108,000 net loss consisted of $10,000 in gains and $118,000 of losses. During the three and six months ended June 30, 2023, proceeds from sales of securities available for sale were and the net gain was inconsequential. The following tables show the Company’s gross unrealized losses and fair value of the Company’s investment securities with unrealized losses for which an allowance for credit losses (“ACL”) has not been recorded, aggregated by investment class and length of time that individual securities have been in a continuous unrealized loss position at June 30, 2024 and December 31, 2023: June 30, 2024 12 Months or Less than 12 Months Longer Total Gross Gross Gross Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses (In thousands) Securities available for sale: Federal agencies $ 114,874 $ 126 $ 79,443 $ 557 $ 194,317 $ 683 $ 114,874 $ 126 $ 79,443 $ 557 $ 194,317 $ 683 December 31, 2023 12 Months or Less than 12 Months Longer Total Gross Gross Gross Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses (In thousands) Securities available for sale: Treasury notes $ 3,052 $ 6 $ 32,080 $ 332 $ 35,132 $ 338 Federal agencies 60,541 189 167,213 2,787 227,754 2,976 Mortgage-backed - Agency 364 1 186 2 550 3 $ 63,957 $ 196 $ 199,479 $ 3,121 $ 263,436 $ 3,317 Allowance for Credit Losses For securities available for sale with an unrealized loss position, the Company evaluates the securities to determine whether the decline in the fair value below the amortized cost basis (impairment) is due to credit-related factors or noncredit related factors. Any impairment that is not credit-related is recognized in accumulated other comprehensive income (loss), net of tax. Credit-related impairment is recognized as an ACL for securities available for sale on the balance sheet, limited to the amount by which the amortized cost basis exceeds the fair value, with a corresponding adjustment to earnings. Accrued interest receivable is excluded from the estimate of credit losses. Both the ACL and the adjustment to net income may be reversed if conditions change. However, if the Company expects, or is required, to sell an impaired available for sale security before recovering its amortized cost basis, the entire impairment amount would be recognized in earnings with a corresponding adjustment to the security’s amortized cost basis. Because the security’s amortized cost basis is adjusted to fair value, there is no ACL in this situation. In evaluating securities available for sale in unrealized loss positions for impairment and the criteria regarding its intent or requirement to sell such securities, the Company considers the extent to which fair value is less than amortized cost, whether the securities are issued by the federal government or its agencies, whether downgrades by bond rating agencies have occurred, and the results of reviews of the issuers’ financial condition, among other factors. Unrealized losses on the Company’s investment securities portfolio have not been recognized as an expense because the securities are of high credit quality, and the decline in fair values is attributable to changes in the prevailing interest rate environment since the purchase date. Fair value is expected to recover as securities reach maturity and/or the interest rate environment returns to conditions similar to when these securities were purchased. There were no credit related factors underlying unrealized losses on available for sale debt securities at June 30, 2024 and December 31, 2023. Securities held to maturity are primarily comprised of non-agency mortgage-backed securities secured by multi-family or single-family properties, and agency mortgage-backed securities secured by multi-family properties. The agency securities held to maturity are Ginnie Mae mortgage-backed securities and backed by the full faith and credit of the U.S. government. Accordingly, no allowance for credit losses has been recorded for these securities. The non-agency securities were purchased under securitization arrangements where a credit loss component was purchased by third party investors. These securities were evaluated for credit losses over and above the credit loss percentage sold under the arrangements, and the Company does not anticipate any such losses. Additional qualitative factors are evaluated, including the timeliness of principal and interest payments under the contractual terms of the securities. Accordingly, no allowance for credit losses has been recorded for the non-agency securities. |
Mortgage Loans in Process of Se
Mortgage Loans in Process of Securitization | 6 Months Ended |
Jun. 30, 2024 | |
Mortgage Loans in Process of Securitization. | |
Mortgage Loans in Process of Securitization | Note 3: Mortgage Loans in Process of Securitization Mortgage loans in process of securitization are recorded at fair value with changes in fair value recorded in earnings. These include multi-family rental real estate loan originations to be sold as Ginnie Mae mortgage-backed securities and Fannie Mae and Freddie Mac participation certificates, all of which are pending settlement under firm investor commitments to purchase the securities, typically occurring within 30 days. The aggregate fair value adjustment recorded on mortgage loans in process of securitization was $0.5 million and $0.8 million as of June 30, 2024 and December 31, 2023, respectively. |
Loans and Allowance for Credit
Loans and Allowance for Credit Losses on Loans | 6 Months Ended |
Jun. 30, 2024 | |
Loans and Allowance for Credit Losses on Loans | |
Loans and Allowance for Credit Losses on Loans | Note 4: Loans and Allowance for Credit Losses on Loans Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are reported at their outstanding principal balances adjusted for unearned income, charge-offs, the ACL-Loans, any unamortized deferred fees or costs on originated loans and unamortized premiums or discounts on purchased loans. For loans at amortized cost, interest income is accrued based on the unpaid principal balance. The Company has made a policy election to exclude accrued interest from the amortized cost basis of loans and reports accrued interest separately from the related loan balance in the consolidated unaudited condensed balance sheets. Accrued interest on loans totaled $58.6 million and $60.4 million at June 30, 2024 and December 31, 2023, respectively. The Company also elected not to measure an allowance for credit losses for accrued interest receivables. The accrual of interest on loans is discontinued at the time the loan is 90 days past due unless the credit is well-secured and in process of collection. Past-due status is based on contractual terms of the loan. Loans may be placed on nonaccrual or charged-off at an earlier date if collection of principal or interest is considered doubtful. All interest accrued but not collected for loans that are placed on nonaccrual or charged-off is reversed against interest income. The interest collected on these loans is applied to the principal balance until the loan can be returned to an accrual status. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured. For all loan portfolio segments, the Company charges off loans, or portions thereof, when available information confirms that specific loans are uncollectable based on information that includes, but is not limited to, (1) the deteriorating financial condition of the borrower, (2) declining collateral values, and/or (3) legal action, including bankruptcy, that impairs the borrower’s ability to adequately meet its obligations. When cash payments for accrued interest are received on nonaccrual loans in each loan class, the Company records a reduction in loan principal. For loan modifications, interest income is recognized on an accrual basis at the renegotiated rate if the loan is in compliance with the modified terms. The Company offers mortgage warehouse repurchase agreements to third parties to fund mortgage loans held for sale from closing until sale to an investor. Under a warehousing arrangement, the Company funds a mortgage loan as secured financing. The warehousing arrangement is secured by the underlying mortgages and a combination of deposits, personal guarantees, and advance rates. The Company typically holds the collateral until it is sent under a bailee arrangement instructing the investor to send proceeds to the Company. Typical investors are large financial institutions or government agencies. Interest earned from the time of funding to the time of sale is recognized as interest income as accrued. Warehouse fees are accrued as noninterest income. Loan Portfolio Summary Loans receivable at June 30, 2024 and December 31, 2023 include: June 30, December 31, 2024 2023 (In thousands) Mortgage warehouse repurchase agreements $ 1,369,965 $ 752,468 Residential real estate 1,345,656 1,324,305 Multi-family financing 4,160,420 4,006,160 Healthcare financing 2,495,910 2,356,689 Commercial and commercial real estate 1,566,809 1,643,081 Agricultural production and real estate 70,244 103,150 Consumer and margin loans 5,213 13,700 11,014,217 10,199,553 Less: ACL-Loans 81,028 71,752 Loans Receivable $ 10,933,189 $ 10,127,801 (1) Includes $1.2 billion and $1.2 billion of All-in-One © first-lien home equity lines of credit at June 30, 2024 and December 31, 2023, respectively. (2) Includes $1.0 billion and $1.1 billion of revolving lines of credit collateralized primarily by mortgage servicing rights as of June 30, 2024 and December 31, 2023, respectively. (3) Includes only $6.8 million and $8.4 million of non-owner occupied commercial real estate as of June 30, 2024 and December 31, 2023, respectively. Risk characteristics applicable to each segment of the loan portfolio are described as follows. Mortgage Warehouse Repurchase Agreements (MTG WHRA): As a secured repurchase agreement, collateral pledged to the Company secures each individual mortgage until the mortgage company sells the loan in the secondary market. A traditional secured warehouse facility typically carries a base interest rate of the Federal Reserve’s Secured Overnight Financing Rate (“SOFR”), or mortgage note rate, and a margin. Risk is evident if there is a change in the fair value of mortgage loans originated by mortgage companies in warehouse, the sale of which is the expected source of repayment under a warehouse facility. However, the warehouse customers are required to hedge the change in value of these loans to mitigate the risk, typically through forward sales contracts. Residential Real Estate Loans (RES RE): Multi-Family Financing (MF FIN): The Company specializes in originating multi-family financing that can be market rate or affordable. The portfolio includes loans for construction, acquisition, refinance, or permanent financing. Loans are typically secured by real estate mortgages, assignment of Low-Income Housing Tax Credits (“LIHTC”), and/or equity interest in the underlying properties. All loans are assessed and reviewed at a minimum based on borrower strength/experience, historical property performance, market trends, projected financial performance with regards to intended strategy, and source of repayment. Independent third-party reports are used to ensure legal conformity and support valuations of the assets. Exit strategies and sources of repayment are provided through the secondary market via governmental programs, strategic refinances, LIHTC equity installments, and cashflow from the properties. Repayment of these loans depends on the successful operation of a business or property and the borrower’s cash flows. Credit risk in these loans may be impacted by the creditworthiness of a borrower, property values and the local economy in the related market area. These loans are well-collateralized and underwritten to agency guidelines. Loans included in this segment typically carry a base rate of 30-day SOFR, that adjusts on a monthly basis, and a margin. The Company strategically focuses on loan classes that are government backed or can be sold in the secondary market. Healthcare Financing (HC FIN): The healthcare financing portfolio includes customized loan products for independent living, assisted living, memory care and skilled nursing projects. A variety of loan products are available to accommodate rehabilitation, acquisition, and refinancing of healthcare properties. Credit risk in these loans are primarily driven by local demographics and the expertise of the operators of the facilities. Repayment of these loans may include permanent loans, sales of developed property or an interim loan commitment from the Company until permanent agency-eligible financing is obtained, as well as successful operation of a business or property and the borrower’s cash flows. These loans are well-collateralized and underwritten to agency guidelines. Loans included in this segment typically carry a base rate of 30-day SOFR, that adjusts on a monthly basis, and a margin. The Company strategically focuses on loan classes that are government backed or can be sold in the secondary market. Commercial Lending and Commercial Real Estate Loans (CML & CRE): The commercial lending and commercial real estate portfolio includes loans to commercial customers for use in financing working capital needs, equipment purchases and expansions, as well as loans to commercial customers to finance land and improvements. It also includes lines of credit collateralized by servicing rights that are assessed for fair value quarterly at the Company’s request. The loans in this category are repaid primarily from the cash flow of a borrower’s principal business operation. Credit risk in these loans is driven by creditworthiness of a borrower and the economic conditions that impact the cash flow stability from business operations. Small Business Administration (“SBA”) loans are included in this category. Less than Agricultural Production and Real Estate Loans (AG & AGRE): Agricultural production loans are generally comprised of seasonal operating lines of credit to grain farmers to plant and harvest corn and soybeans and term loans to fund the purchase of equipment. The Company also offers long-term financing to purchase agricultural real estate. Specific underwriting standards have been established for agricultural-related loans including the establishment of projections for each operating year based on industry-developed estimates of farm input costs and expected commodity yields and prices. Operating lines are typically written for one year and secured by the crop and other farm assets as considered necessary. The Company is approved to sell agricultural loans in the secondary market through the Federal Agricultural Mortgage Corporation and uses this relationship to manage interest rate risk within the portfolio. Agricultural real estate loans included in this segment are typically structured with a one-year adjustable rate mortgage (“ARM”), three-year ARM or five-year ARM CMT and a margin. Agriculture production, livestock, and equipment loans are structured with variable rates that are indexed to prime or fixed for terms not exceeding five years. Consumer and Margin Loans (CON & MAR): Consumer loans are those loans secured by household assets. Margin loans are those loans secured by marketable securities. The term and maximum amount for these loans are determined by considering the purpose of the loan, the margin (advance percentage against value) in all collateral, the primary source of repayment, and the borrower’s other related cash flow. ACL-Loans The ACL-Loans is the Company’s estimate of current expected credit losses. Loans receivable is presented net of the allowance to reflect the principal balance expected to be collected over the contractual term of the loans. This life of loan allowance is established through a provision for credit losses included in net interest income after provision for credit losses as loans are recorded in the financial statements. The provision for a reporting period also reflects increases or decreases in the allowance related to changes in credit loss expectations. Actual credit losses are charged against the allowance when management believes the uncollectability of a loan balance, or a portion thereof, is confirmed. Subsequent recoveries, if any, are credited to the allowance. The ACL-Loans is evaluated on a regular basis by management and is based upon management’s periodic review of the collectability of the loans considering relevant available information from internal and external sources, including historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral and prevailing economic conditions. The allowance also incorporates reasonable and supportable forecasts. This evaluation is inherently subjective, as it requires estimates that are susceptible to significant revision as more information becomes available. The level of the ACL-Loans is believed to be adequate to absorb innate expected future losses in the loan portfolio as of the measurement date. The ACL-Loans consists of individually evaluated loans and pooled loan components. The Company’s primary portfolio segmentation is by loans with similar risk characteristics. Loans risk graded substandard and worse are individually evaluated for expected credit losses. For individually evaluated loans that are collateral dependent, the Company may use the fair value of the collateral, less estimated costs to sell, as a practical expedient as of the reporting date to determine the carrying amount of an asset and the allowance for credit losses, as applicable. A loan is considered to be collateral dependent when repayment is expected to be provided substantially through the operation or the sale of the collateral when the borrower is experiencing financial difficulty as of the reporting date. To calculate the ACL-Loans, the portfolio is segmented by loans with similar risk characteristics. Loan Portfolio Segment ACL-Loans Methodology Mortgage warehouse repurchase agreements Remaining Life Method Residential real estate loans Discounted Cash Flow Multi-family financing Discounted Cash Flow Healthcare financing Discounted Cash Flow Commercial and commercial real estate Discounted Cash Flow Agricultural production and real estate Remaining Life Method Consumer and margin loans Remaining Life Method Loan characteristics used in determining the segmentation included the underlying collateral, type or purpose of the loan, and expected credit loss patterns. The initial estimation of expected credit losses for each segment is based on historical credit loss experience and management’s judgement. Given the Company’s modest historical credit loss experience, peer and industry data was incorporated into the measurement. Expected life of loan credit losses are quantified using discounted cash flows and remaining life methodologies. Model results are supplemented by qualitative adjustments for risk factors relevant in assessing the expected credit losses within the portfolio segments. These adjustments may increase or decrease the estimate of expected credit losses based upon the assessed level of risk for each qualitative factor. The models utilized and the applicable qualitative adjustments require assumptions and management judgement that can be subjective in nature. The above measurement approach is also used to estimate the expected credit losses associated with unfunded loan commitments, which also incorporates expected utilization rates. The following tables present, by loan portfolio segment, the activity in the ACL-Loans for the three and six months ended June 30, 2024 and 2023: For the Three Months Ended June 30, 2024 MTG WHRA RES RE MF FIN HC FIN CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) ACL-Loans Balance, beginning of period $ 3,022 $ 6,905 $ 28,664 $ 24,587 $ 11,990 $ 450 $ 94 $ 75,712 Provision for credit losses 594 (595) 9,097 (1,065) 702 39 (19) 8,753 Loans charged to the allowance — — (3,349) — (103) — — (3,452) Recoveries of loans previously charged-off — 13 — — 2 — — 15 Balance, end of period $ 3,616 $ 6,323 $ 34,412 $ 23,522 $ 12,591 $ 489 $ 75 $ 81,028 For the Three Months Ended June 30, 2023 MTG WHRA RES RE MF FIN HC FIN CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) ACL-Loans Balance, beginning of period $ 1,664 $ 7,378 $ 19,851 $ 11,753 $ 10,482 $ 543 $ 167 $ 51,838 Provision for credit losses 1,697 48 13,250 4,370 1,329 13 (29) 20,678 Loans charged to the allowance — (13) (8,400) — (1,118) — (1) (9,532) Recoveries of loans previously charged-off — — — — 2 — — 2 Balance, end of period $ 3,361 $ 7,413 $ 24,701 $ 16,123 $ 10,695 $ 556 $ 137 $ 62,986 The Company recorded a total provision for credit losses of $10.0 million for the three months ended June 30, 2024. The $10.0 million total provision for credit losses consisted of $8.8 million for the ACL-Loans as shown above and $1.2 million for the ACL-OBCE’s. The Company recorded a total provision for credit losses of $22.6 million for the three months ended June 30, 2023. The $22.6 million total provision for credit losses consisted of $20.7 million for the ACL-Loans as shown above and $1.9 million for the ACL-OBCE’s. For the Six Months Ended June 30, 2024 MTG WHRA RES RE MF FIN HC FIN CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) ACL-Loans Balance, beginning of period $ 2,070 $ 7,323 $ 26,874 $ 22,454 $ 12,243 $ 619 $ 169 $ 71,752 FMBI's ACL for loans sold — (55) (186) (2) (92) (246) (12) (593) Provision for credit losses 1,546 (958) 11,073 1,070 1,465 116 (82) 14,230 Loans charged to the allowance — — (3,349) — (1,028) — — (4,377) Recoveries of loans previously charged-off — 13 — — 3 — — 16 Balance, end of period $ 3,616 $ 6,323 $ 34,412 $ 23,522 $ 12,591 $ 489 $ 75 $ 81,028 For the Six Months Ended June 30, 2023 MTG WHRA RES RE MF FIN HC FIN CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) ACL-Loans Balance, beginning of period $ 1,249 $ 7,029 $ 16,781 $ 9,882 $ 8,326 $ 565 $ 182 $ 44,014 Provision for credit losses 2,112 397 16,320 6,241 3,478 (9) (44) 28,495 Loans charged to the allowance — (13) (8,400) — (1,118) — (1) (9,532) Recoveries of loans previously charged-off — — — — 9 — — 9 Balance, end of period $ 3,361 $ 7,413 $ 24,701 $ 16,123 $ 10,695 $ 556 $ 137 $ 62,986 The Company recorded a total provision for credit losses of $14.7 million for the six months ended June 30, 2024. The $14.7 million total provision for credit losses consisted of $13.6 million for the ACL-Loans, net of FMBI’s ACL, as shown above and $1.1 million for the ACL-OBCE’s. The Company recorded a total provision for credit losses of $29.5 million for the six months ended June 30, 2023. The $29.5 million total provision for credit losses consisted of $28.5 million for the ACL-Loans as shown above and $1.0 million for the ACL-OBCE’s. The following table presents, by loan portfolio segment, the activity in the ACL-Loans, for the year-ended December 31, 2023: For the Year Ended December 31, 2023 MTG WHRA RES RE MF FIN HC FIN CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) ACL-Loans Balance, beginning of period $ 1,249 $ 7,029 $ 16,781 $ 9,882 $ 8,326 $ 565 $ 182 $ 44,014 Provision for credit losses 821 328 18,493 12,572 5,232 54 (12) 37,488 Loans charged to the allowance — (34) (8,400) — (1,356) — (1) (9,791) Recoveries of loans previously charged-off — — — — 41 — — 41 Balance, end of period $ 2,070 $ 7,323 $ 26,874 $ 22,454 $ 12,243 $ 619 $ 169 $ 71,752 The below table presents the amortized cost basis and ACL-Loans allocated for collateral dependent loans, which are individually evaluated to determine expected credit losses as of June 30, 2024 and December 31, 2023: June 30, 2024 Real Estate Accounts Receivable / Equipment Other Total ACL-Loans Allocation (In thousands) RES RE $ 5,752 $ — $ — $ 5,752 $ 31 MF FIN 160,497 — 693 161,190 4,752 HC FIN 73,409 — — 73,409 5,798 CML & CRE 1,343 2,422 2,576 6,341 1,979 AG & AGRE 147 — — 147 1 Total collateral dependent loans $ 241,148 $ 2,422 $ 3,269 $ 246,839 $ 12,561 There have been no significant changes to the types of collateral securing the Company’s collateral dependent loans compared to December 31, 2023. December 31, 2023 Real Estate Accounts Receivable / Equipment Other Total ACL-Loans Allocation (In thousands) RES RE $ 1,557 $ — $ 3 $ 1,560 $ 21 MF FIN 46,575 — — 46,575 521 HC FIN 73,909 — — 73,909 6,289 CML & CRE 146 3,603 2,684 6,433 1,132 AG & AGRE 147 — — 147 1 CON & MAR — — 3 3 — Total collateral dependent loans $ 122,334 $ 3,603 $ 2,690 $ 128,627 $ 7,964 Internal Risk Categories The Company evaluates the loan risk grading system definitions and ACL-Loans methodology on an ongoing basis. As of December 31, 2023, the Company created a newly defined special mention risk rating category to be consistent with industry practices. Loans with a Watch classification are now included in the Pass risk rating category as of December 31, 2023. This updated policy was approved by the Company’s Management Committee, to be effective as of December 31, 2023 on a prospective basis. In adherence with policy, the Company uses the following internal risk grading categories and definitions for loans since December 31, 2023: Pass Special Mention – Loans classified as special mention have potential weaknesses that deserve management’s attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the asset or in the institution’s credit position at some future date. Special Mention loans are not adversely classified and do not warrant adverse classification. Loans with questions or concerns regarding collateral, adverse market conditions impacting future performance, and declining financial trends would be considered for Special Mention. Substandard Doubtful The following tables present the credit risk profile of the Company’s loan portfolio based on internal risk rating category and origination year as of June 30, 2024 and December 31, 2023: June 30, 2024 2024 2023 2022 2021 2020 Prior Revolving Loans TOTAL (In thousands) MTG WHRA Pass $ — $ — $ — $ — $ — $ — $ 1,369,965 $ 1,369,965 Total $ — $ — $ — $ — $ — $ — $ 1,369,965 $ 1,369,965 Charge-offs $ — $ — $ — $ — $ — $ — $ — $ — RES RE Pass $ 16,683 $ 33,162 $ 8,370 $ 5,921 $ 20,799 $ 7,063 $ 1,247,690 $ 1,339,688 Special Mention — — — — — 216 — 216 Substandard — — 22 — — — 5,730 5,752 Total $ 16,683 $ 33,162 $ 8,392 $ 5,921 $ 20,799 $ 7,279 $ 1,253,420 $ 1,345,656 Charge-offs $ — $ — $ — $ — $ — $ — $ — $ — MF FIN Pass $ 514,012 $ 800,439 $ 658,884 $ 115,723 $ 6,760 $ 34,139 $ 1,768,242 $ 3,898,199 Special Mention 29,010 16,869 29,853 — — 1,463 23,836 101,031 Substandard — 81,392 70,502 2,557 — — 6,739 161,190 Total $ 543,022 $ 898,700 $ 759,239 $ 118,280 $ 6,760 $ 35,602 $ 1,798,817 $ 4,160,420 Charge-offs $ — $ 870 $ 2,479 $ — $ — $ — $ — $ 3,349 HC FIN Pass $ 424,343 $ 456,170 $ 901,647 $ 75,333 $ — $ 14,356 $ 415,686 $ 2,287,535 Special Mention 24,585 67,000 24,844 — — — 18,537 134,966 Substandard — 36,650 — 28,458 — — 8,301 73,409 Total $ 448,928 $ 559,820 $ 926,491 $ 103,791 $ — $ 14,356 $ 442,524 $ 2,495,910 Charge-offs $ — $ — $ — $ — $ — $ — $ — $ — CML & CRE Pass $ 29,422 $ 48,441 $ 110,317 $ 62,237 $ 18,746 $ 24,177 $ 1,259,341 $ 1,552,681 Special Mention — 112 — 7,190 — 58 427 7,787 Substandard — — 269 1,953 822 57 3,240 6,341 Total $ 29,422 $ 48,553 $ 110,586 $ 71,380 $ 19,568 $ 24,292 $ 1,263,008 $ 1,566,809 Charge-offs $ — $ — $ 103 $ 925 $ — $ — $ — $ 1,028 AG & AGRE Pass $ 13,636 $ 7,246 $ 4,855 $ 2,601 $ 8,482 $ 14,688 $ 18,589 $ 70,097 Substandard — — — — — 147 — 147 Total $ 13,636 $ 7,246 $ 4,855 $ 2,601 $ 8,482 $ 14,835 $ 18,589 $ 70,244 Charge-offs $ — $ — $ — $ — $ — $ — $ — $ — CON & MAR Pass $ 174 $ 92 $ 25 $ 21 $ — $ 4,230 $ 671 $ 5,213 Total $ 174 $ 92 $ 25 $ 21 $ — $ 4,230 $ 671 $ 5,213 Charge-offs $ — $ — $ — $ — $ — $ — $ — $ — Total Pass $ 998,270 $ 1,345,550 $ 1,684,098 $ 261,836 $ 54,787 $ 98,653 $ 6,080,184 $ 10,523,378 Total Special Mention $ 53,595 $ 83,981 $ 54,697 $ 7,190 $ — $ 1,737 $ 42,800 $ 244,000 Total Substandard $ — $ 118,042 $ 70,793 $ 32,968 $ 822 $ 204 $ 24,010 $ 246,839 Total Doubtful $ — $ — $ — $ — $ — $ — $ — $ — Total Loans $ 1,051,865 $ 1,547,573 $ 1,809,588 $ 301,994 $ 55,609 $ 100,594 $ 6,146,994 $ 11,014,217 Total Charge-offs $ — $ 870 $ 2,582 $ 925 $ — $ — $ — $ 4,377 December 31, 2023 2023 2022 2021 2020 2019 Prior Revolving Loans TOTAL (In thousands) MTG WHRA Pass $ — $ — $ — $ — $ — $ — $ 752,468 $ 752,468 Total $ — $ — $ — $ — $ — $ — $ 752,468 $ 752,468 Charge-offs $ — $ — $ — $ — $ — $ — $ — $ — RES RE Pass $ 31,011 $ 10,086 $ 6,573 $ 22,725 $ 3,298 $ 9,340 $ 1,239,161 $ 1,322,194 Special Mention — — — — 59 492 — 551 Substandard — — — — — 288 1,272 1,560 Total $ 31,011 $ 10,086 $ 6,573 $ 22,725 $ 3,357 $ 10,120 $ 1,240,433 $ 1,324,305 Charge-offs $ — $ — $ — $ — $ — $ 21 $ 13 $ 34 MF FIN Pass $ 1,094,698 $ 762,448 $ 208,343 $ 77,340 $ 29,764 $ 8,455 $ 1,646,445 $ 3,827,493 Special Mention 94,973 3,189 8,400 — — 1,477 24,052 132,091 Substandard 11,682 28,360 6,534 — — — — 46,576 Total $ 1,201,353 $ 793,997 $ 223,277 $ 77,340 $ 29,764 $ 9,932 $ 1,670,497 $ 4,006,160 Charge-offs $ — $ 8,400 $ — $ — $ — $ — $ — $ 8,400 HC FIN Pass $ 752,591 $ 996,273 $ 110,197 $ — $ 14,563 $ — $ 351,110 $ 2,224,734 Special Mention 35,869 9,520 — — — — 12,658 58,047 Substandard 25,600 10,625 28,783 — — — 8,900 73,908 Total $ 814,060 $ 1,016,418 $ 138,980 $ — $ 14,563 $ — $ 372,668 $ 2,356,689 Charge-offs $ — $ — $ — $ — $ — $ — $ — $ — CML & CRE Pass $ 51,110 $ 119,386 $ 77,316 $ 21,154 $ 21,088 $ 17,066 $ 1,328,980 $ 1,636,100 Special Mention — — 292 172 — 84 — 548 Substandard — 70 1,701 878 62 — 3,672 6,383 Doubtful — — — — — 50 — 50 Total $ 51,110 $ 119,456 $ 79,309 $ 22,204 $ 21,150 $ 17,200 $ 1,332,652 $ 1,643,081 Charge-offs $ — $ 496 $ 274 $ 586 $ — $ — $ — $ 1,356 AG & AGRE Pass $ 16,850 $ 9,825 $ 6,490 $ 14,267 $ 5,237 $ 16,606 $ 33,728 $ 103,003 Special Mention — — — — — — — — Substandard — — — — — 147 — 147 Total $ 16,850 $ 9,825 $ 6,490 $ 14,267 $ 5,237 $ 16,753 $ 33,728 $ 103,150 Charge-offs $ — $ — $ — $ — $ — $ — $ — $ — CON & MAR Pass $ 748 $ 4,329 $ 247 $ 115 $ 27 $ 4,339 $ 3,862 $ 13,667 Special Mention — — — 15 15 — — 30 Substandard — — — — — 3 — 3 Total $ 748 $ 4,329 $ 247 $ 130 $ 42 $ 4,342 $ 3,862 $ 13,700 Charge-offs $ — $ — $ — $ — $ — $ 1 $ — $ 1 Total Pass $ 1,947,008 $ 1,902,347 $ 409,166 $ 135,601 $ 73,977 $ 55,806 $ 5,355,754 $ 9,879,659 Total Special Mention $ 130,842 $ 12,709 $ 8,692 $ 187 $ 74 $ 2,053 $ 36,710 $ 191,267 Total Substandard $ 37,282 $ 39,055 $ 37,018 $ 878 $ 62 $ 438 $ 13,844 $ 128,577 Total Doubtful $ — $ — $ — $ — $ — $ 50 $ — $ 50 Total Loans $ 2,115,132 $ 1,954,111 $ 454,876 $ 136,666 $ 74,113 $ 58,347 $ 5,406,308 $ 10,199,553 Total Charge-offs $ — $ 8,896 $ 274 $ 586 $ — $ 22 $ 13 $ 9,791 The Company did not have any material revolving loans converted to term loans at June 30, 2024 or December 31, 2023. Delinquent Loans The following tables present the Company’s loan portfolio aging analysis of the recorded investment in loans as of June 30, 2024 and December 31, 2023. June 30, 2024 30-59 Days 60-89 Days 90+ Days Total Total Past Due Past Due Past Due Past Due Current Loans (In thousands) MTG WHRA $ — $ — $ — $ — $ 1,369,965 $ 1,369,965 RES RE — 1,026 5,244 6,270 1,339,386 1,345,656 MF FIN 40,743 40,719 69,146 150,608 4,009,812 4,160,420 HC FIN — 25,601 47,809 73,410 2,422,500 2,495,910 CML & CRE — 445 3,959 4,404 1,562,405 1,566,809 AG & AGRE — — 156 156 70,088 70,244 CON & MAR — — — — 5,213 5,213 $ 40,743 $ 67,791 $ 126,314 $ 234,848 $ 10,779,369 $ 11,014,217 December 31, 2023 30-59 Days 60-89 Days 90+ Days Total Total Past Due Past Due Past Due Past Due Current Loans (In thousands) MTG WHRA $ — $ — $ — $ — $ 752,468 $ 752,468 RES RE 4,557 — 2,379 6,936 1,317,369 1,324,305 MF FIN 38,218 11,055 39,609 88,882 3,917,278 4,006,160 HC FIN — 47,275 35,999 83,274 2,273,415 2,356,689 CML & CRE 172 393 3,665 4,230 1,638,851 1,643,081 AG & AGRE 27 11 147 185 102,965 103,150 CON & MAR 1 3 18 22 13,678 13,700 $ 42,975 $ 58,737 $ 81,817 $ 183,529 $ 10,016,024 $ 10,199,553 There were no delinquent loans classified as held for sale at June 30, 2024. The above table does not include one multi-family loan, 30-59 days past due, classified as held for sale at December 31, 2023, totaling $16.5 million. Nonperforming Loans Nonaccrual loans, including modified loans to borrowers experiencing financial difficulty that have not met the six-month minimum performance criterion, are reported as nonperforming loans. For all loan classes, it is the Company’s policy to have any modified loans which are on nonaccrual status prior to being modified, remain on nonaccrual status until six months of satisfactory borrower performance, at which time management would consider its return to accrual status. A loan is generally classified as nonaccrual when the Company believes that receipt of principal and interest is doubtful under the terms of the loan agreement. Generally, this is at 90 days or more past due. The amount of interest income recognized on nonaccrual financial assets during the three and six months ended June 30, 2024 was $0.9 million, which was collected when a loan was paid off, and was immaterial for the three and six months ended June 30, 2023. The following table presents the Company’s nonaccrual loans and loans past due 90 days or more and still accruing at June 30, 2024 and December 31, 2023. June 30, December 31, 2024 2023 Total Loans > Total Loans > 90 Days & 90 Days & Nonaccrual Accruing Nonaccrual Accruing |
Variable Interest Entities (VIE
Variable Interest Entities (VIEs) | 6 Months Ended |
Jun. 30, 2024 | |
Variable Interest Entities (VIEs) | |
Variable Interest Entities (VIEs) | Note 5: Variable Interest Entities (VIEs) A VIE is a corporation, partnership, limited liability company, or any other legal structure used to conduct activities or hold assets generally that either: ● Does not have equity investors with voting rights that can directly or indirectly make decisions about the entity’s activities through those voting rights or similar rights; or ● Has equity investors that do not provide sufficient equity for the entity to finance its activities without additional subordinated financial support. The Company has invested in single-family, multi-family, and healthcare debt financing entities, as well as low-income housing syndicated funds that are deemed to be VIEs. The Company also has deemed as VIEs a REMIC trust that was established in conjunction with the September 2022 multi-family loan sale and securitization transaction, as well as additional REMIC trusts that were established in December 2023 and June 2024 with a related party in conjunction with securitizations. Accordingly, the entities were assessed for potential consolidation under the VIE model that requires primary beneficiaries to consolidate the entity’s results. A primary beneficiary is defined as the party that has both the power to direct the activities that most significantly impact the entity, and an interest that could be significant to the entity. To determine if an interest could be significant to the entity, both qualitative and quantitative factors regarding the nature, size and form of involvement with the entity are evaluated. At June 30, 2024 the Company determined it was not the primary beneficiary for most of its VIEs, primarily because the Company did not have the obligation to absorb losses or the rights to receive benefits from the VIE that could potentially be significant to the VIE. Evaluation and assessment of VIEs for consolidation is performed on an ongoing basis by management. Any changes in facts and circumstances occurring since the previous primary beneficiary determination will be considered as part of this ongoing assessment. The table below reflects the assets and liabilities of the VIEs as well as our maximum exposure to loss in connection with unconsolidated VIEs at June 30, 2024 and December 31, 2023. Investments Bridge loans Securities Maximum Liabilities Assets in VIEs to VIEs for VIEs Exposure to Loss for VIEs ($ in thousands) June 30, 2024 Low-income housing tax credit investments $ 107,402 $ 151,890 $ — $ 259,292 $ 28,035 Debt funds 31,180 35,855 — 67,035 2,752 Off-balance-sheet REMIC trusts — 19,790 1,279,174 1,298,964 — Total Unconsolidated VIEs $ 138,582 $ 207,535 $ 1,279,174 $ 1,625,291 $ 30,787 December 31, 2023 Low-income housing tax credit investments $ 118,741 $ 232,407 $ — $ 351,148 $ 35,099 Debt funds 33,221 86,416 — 119,637 2,752 Off-balance-sheet REMIC trusts — — 1,192,201 1,192,201 — Total Unconsolidated VIEs $ 151,962 $ 318,823 $ 1,192,201 $ 1,662,986 $ 37,851 |
Regulatory Matters
Regulatory Matters | 6 Months Ended |
Jun. 30, 2024 | |
Regulatory Matters | |
Regulatory Matters | Note 6: Regulatory Matters The Company, Merchants Bank and FMBI (prior to the January 26, 2024 sale of its branches and merger of its remaining charter into Merchants Bank) are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory, and possibly additional discretionary, actions by federal and state banking regulators that, if undertaken, could have a direct material effect on the Company’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and Merchants Bank must meet specific capital guidelines that involve quantitative measures of the Company’s and Merchants Bank’s assets, liabilities and certain off-balance-sheet items as calculated under regulatory accounting practices. The Company’s and Merchants Bank’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, and other factors. Furthermore, the Company’s and Merchants Bank’s regulators could require adjustments to regulatory capital not reflected in these financial statements. Quantitative measures established by regulation to ensure capital adequacy require the Company and Merchants Bank to maintain minimum amounts and ratios (set forth in the table below). Management believes, as of June 30, 2024 and December 31, 2023, that the Company and Merchants Bank met all capital adequacy requirements. For additional information regarding dividend restrictions, see the Company’s 2023 Annual Report on Form 10–K. As of June 30, 2024 and December 31, 2023, the most recent notifications from the Board of Governors of the Federal Reserve System (“Federal Reserve”) categorized the Company as well capitalized and most recent notifications from the Federal Deposit Insurance Corporation (“FDIC”) categorized Merchants Bank as well capitalized under the regulatory framework for prompt corrective action. There are no conditions or events since that notification that management believes have changed the Company’s or Merchants Bank’s category. FMBI was subject to these same requirements and guidelines prior to the sale of its branches and the merger of its remaining charter into Merchants Bank in January 2024. As of December 31, 2023, FMBI met all capital adequacy requirements (as set forth in the table below). The FDIC categorized FMBI as well capitalized at that time and there are no conditions or events since that notification that management believes would have changed that category. The Company’s, Merchants Bank’s, and FMBI’s actual capital amounts and ratios are presented in the following tables. Minimum Amount to be Well Minimum Amount Capitalized with To Be Well Actual Basel III Buffer (1) Capitalized (1) Amount Ratio Amount Ratio Amount Ratio (Dollars in thousands) June 30, 2024 Total capital (1) Company $ 1,977,729 12.0 % $ 1,726,065 10.5 % $ — N/A % Merchants Bank 1,971,631 12.0 % 1,725,481 10.5 % 1,643,316 10.0 Tier I capital (1) Company 1,879,605 11.4 % 1,397,291 8.5 % — N/A % Merchants Bank 1,873,508 11.4 % 1,396,818 8.5 % 1,314,653 8.0 Common Equity Tier I capital (1) Company 1,430,219 8.7 % 1,150,710 7.0 % — N/A % Merchants Bank 1,873,508 11.4 % 1,150,321 7.0 % 1,068,155 6.5 Tier I capital (1) Company 1,879,605 10.6 % 890,257 5.0 % — N/A % Merchants Bank 1,873,508 10.5 % 887,924 5.0 % 887,924 5.0 (1) As defined by regulatory agencies. Minimum Amount to be Well Minimum Amount Capitalized with To Be Well Amount Ratio Amount Ratio Amount Ratio (Dollars in thousands) December 31, 2023 Total capital (1) Company $ 1,772,195 11.6 % $ 1,598,260 10.5 % $ — N/A % Merchants Bank 1,724,505 11.5 % 1,577,434 10.5 % 1,502,318 10.0 % FMBI 40,613 21.1 % 20,209 10.5 % 19,247 10.0 % Tier I capital (1) Company 1,686,202 11.1 % 1,293,830 8.5 % — N/A % Merchants Bank 1,639,171 10.9 % 1,276,970 8.5 % 1,201,854 8.0 % FMBI 39,953 20.8 % 16,360 8.5 % 15,398 8.0 % Common Equity Tier I capital (1) Company 1,186,594 7.8 % 1,065,507 7.0 % — N/A % Merchants Bank 1,639,171 10.9 % 1,051,623 7.0 % 976,507 6.5 % FMBI 39,953 20.8 % 13,473 7.0 % 12,511 6.5 % Tier I capital (1) Company 1,686,202 10.1 % 832,706 5.0 % — N/A % Merchants Bank 1,639,171 10.1 % 815,191 5.0 % 815,191 5.0 % FMBI 39,953 11.5 % 17,391 5.0 % 17,391 5.0 % (1) A s defined by regulatory agencies. |
Derivative Financial Instrument
Derivative Financial Instruments | 6 Months Ended |
Jun. 30, 2024 | |
Derivative Financial Instruments | |
Derivative Financial Instruments | Note 7: Derivative Financial Instruments The Company uses non-hedging designated, derivative financial instruments to help manage exposure to interest rate risk and the effects that changes in interest rates may have on net income and the fair value of assets and liabilities. Internal Interest Rate Risk Management The Company enters into forward contracts for the future delivery of mortgage loans to third party investors and enters into interest rate lock commitments with potential borrowers to fund specific mortgage loans that will be sold into the secondary market. The forward contracts are entered into in order to economically hedge the effect of changes in interest rates resulting from the Company’s commitment to fund the loans. Interest rate swaps are also used by the Company to reduce the risk that significant increases in interest rates may have on the value of certain fixed rate loans held for sale and the respective loan payments received from borrowers. All changes in the fair market value of these interest rate swaps and associated loans held for sale have been included in gain on sale of loans. Any difference between the fixed and floating interest rate components of these transactions have been included in interest income. The Company entered into a contract containing put options and interest rate floors on securities it acquired from a warehouse customer. These provide protection and prevent losses in value of certain securities available for sale. The Company also entered into interest rate floor contracts with two warehouse loan customers to minimize interest rate risk. All changes in the fair market value of these options and floors have been included in other noninterest income. Credit Risk Management In March 2024, the Company entered into a contract as the buyer of credit protection through the credit derivative market. A credit default swap was purchased to manage credit risk associated with specific multifamily mortgage loans. Under the terms of the contract, the Company will be compensated for certain credit-related losses on a pool of multifamily mortgage loans. The protection seller has posted aggregate collateral of $76.1 million related to their obligations under the contract. Th collateral is not included in the Company’s balance sheet. There was no gain or loss associated with the credit default swap valuation as of June 30, 2024. Any future changes in the fair market value of this instrument will be included in other noninterest income. All of these items are considered derivatives, but are not designated as accounting hedges, and are recorded at fair value with changes in fair value reflected in noninterest income on the unaudited condensed consolidated statements of income. The fair value of derivative instruments with a positive fair value are reported in other assets in the unaudited condensed consolidated balance sheets while derivative instruments with a negative fair value are reported in other liabilities in the unaudited condensed consolidated balance sheets. The following table presents the notional amount and fair value of interest rate locks, forward contracts, interest rate swaps, put options and interest rate floors utilized by the Company at June 30, 2024 and December 31, 2023. This table excludes the fair market value adjustment on loans associated with these derivatives. Notional Fair Value Amount Balance Sheet Location Asset Liability June 30, 2024 (In thousands) (In thousands) Interest rate lock commitments $ 50,471 Other assets/liabilities $ 170 $ 127 Forward contracts 60,524 Other assets/liabilities 149 88 Interest rate swaps 57,513 Other assets/liabilities 4,232 — Put options 719,731 Other assets 36,957 — Interest rate floors 1,224,171 Other assets 9,124 — Credit derivatives 76,081 Other liabilities — — $ 50,632 $ 215 Notional Fair Value Amount Balance Sheet Location Asset Liability December 31, 2023 (In thousands) (In thousands) Interest rate lock commitments $ 16,526 Other assets/liabilities $ 140 $ 4 Forward contracts 25,500 Other assets/liabilities 4 391 Interest rate swaps 57,540 Other assets/liabilities 2,610 — Put options 748,374 Other assets 25,877 — Interest rate floors 748,374 Other assets 6,576 — $ 35,207 $ 395 The following table summarizes the periodic changes in the fair value of the derivative financial instruments on the condensed consolidated statements of income for the three and six months ended June 30, 2024 and 2023. Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 (In thousands) (In thousands) Derivative gain (loss) included in gain on sale of loans: Interest rate lock commitments $ (109) $ (188) $ (93) $ 21 Forward contracts (includes pair-off settlements) 285 376 379 280 Interest rates swaps 247 1,597 1,622 261 Net gain $ 423 $ 1,785 $ 1,908 $ 562 Derivative gain included in other income: Put options $ 3,467 $ — $ 11,080 $ — Interest rate floors 214 — 2,548 — Net gain $ 3,681 $ — $ 13,628 $ — Derivatives on Behalf of Customers The Company offers derivative contracts to some customers in connection with their risk management needs. These derivatives include interest rate swap, cap, and floor arrangements. The Company manages the risk associated with these contracts by entering into an equal and offsetting back-to-back derivative with a third-party dealer. These derivatives generally work together as an offsetting economic interest rate hedge, but the Company does not designate them for hedge accounting treatment. Consequently, changes in fair value of the corresponding derivative financial asset or liability were recorded as either a charge or credit to current earnings during the period in which the changes occurred, typically resulting in no material net earnings impact. The fair values of derivative assets and liabilities related to back-to-back derivatives on behalf of customers were recorded in the unaudited condensed consolidated balance sheets as follows: Notional Fair Value Amount Balance Sheet Location Asset Liability (In thousands) (In thousands) June 30, 2024 $ 637,876 Other assets/liabilities $ 9,888 $ 9,888 December 31, 2023 $ 607,169 Other assets/liabilities $ 12,426 $ 12,426 The gross gains and losses on these derivative assets and liabilities were recorded in other noninterest income and other noninterest expense in the unaudited condensed consolidated statements of income as follows: Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 (In thousands) (In thousands) Gross swap gains $ 5,371 $ 7,016 $ 2,538 $ 6,436 Gross swap losses 5,371 7,016 2,538 6,436 Net swap gains (losses) $ — $ — $ — $ — The Company pledged $0 in collateral to secure its obligations under swap contracts at both June 30, 2024 and December 31, 2023. |
Disclosures about Fair Value of
Disclosures about Fair Value of Assets and Liabilities | 6 Months Ended |
Jun. 30, 2024 | |
Disclosures about Fair Value of Assets and Liabilities | |
Disclosures about Fair Value of Assets and Liabilities | Note 8: Disclosures about Fair Value of Assets and Liabilities Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements must maximize the use of observable inputs and minimize the use of unobservable inputs. There is a hierarchy of three levels of inputs that may be used to measure fair value: Level 1 Level 2 Level 3 Recurring Measurements The following tables present the fair value measurements of assets and liabilities recognized in the accompanying unaudited condensed consolidated balance sheets measured at fair value on a recurring basis and the level within the fair value hierarchy in which the fair value measurements fall at June 30, 2024 and December 31, 2023: Fair Value Measurements Using Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Fair Assets Inputs Inputs Assets Value (Level 1) (Level 2) (Level 3) (In thousands) June 30, 2024 Mortgage loans in process of securitization $ 209,244 $ — $ 209,244 $ — Securities available for sale: Treasury notes 109,079 109,079 — — Federal agencies 219,318 — 219,318 — Mortgage-backed - Agency 5,848 — 5,848 — Mortgage-backed - Non-agency residential - fair value option 462,627 — — 462,627 Mortgage-backed - Agency - fair value option 220,147 — 220,147 — Loans held for sale 102,873 — 102,873 — Servicing rights 178,776 — — 178,776 Derivative assets: Interest rate lock commitments 170 — — 170 Forward contracts 149 — 149 — Interest rate swaps 4,232 — 4,232 — Interest rate swaps, caps and floors (back-to-back) 9,888 — 9,888 — Put options 36,957 — 12,300 24,657 Interest rate floors 9,124 — — 9,124 Derivative liabilities: Interest rate lock commitments 127 — — 127 Forward contracts 88 — 88 — Interest rate swaps, caps and floors (back-to-back) 9,888 — 9,888 — December 31, 2023 Mortgage loans in process of securitization $ 110,599 $ — $ 110,599 $ — Securities available for sale: Treasury notes 128,968 128,968 — — Federal agencies 247,755 — 247,755 — Mortgage-backed - Agency 14,467 — 14,467 — Mortgage-backed - Non-agency residential - fair value option 485,500 — — 485,500 Mortgage-backed - Agency - fair value option 236,997 — 236,997 — Loans held for sale 86,663 — 86,663 — Servicing rights 158,457 — — 158,457 Derivative assets: Interest rate lock commitments 140 — — 140 Forward contracts 4 — 4 — Interest rate swaps 2,610 — 2,610 — Interest rate swaps, caps and floors (back-to-back) 12,426 — 12,426 — Put options 25,877 — 7,223 18,654 Interest rate floors 6,576 — — 6,576 Derivative liabilities: Interest rate lock commitments 4 — — 4 Forward contracts 391 — 391 — Interest rate swaps, caps and floors (back-to-back) 12,426 — 12,426 — Following is a description of the valuation methodologies and inputs used for assets measured at fair value on a recurring basis and recognized in the accompanying unaudited condensed consolidated balance sheets, as well as the general classification of such assets pursuant to the valuation hierarchy. There have been no significant changes in the valuation techniques during the six months ended June 30, 2024 and the year ended December 31, 2023. For assets classified within Level 3 of the fair value hierarchy, the process used to develop the reported fair value is described below. Mortgage Loans in Process of Securitization, Securities Available for Sale, and Securities with a Fair Value Option Election Where quoted market prices are available in an active market, securities, such as U.S. Treasuries, are classified within Level 1 of the valuation hierarchy. If quoted market prices are not available, then fair values are estimated by using quoted prices of securities with similar characteristics or independent asset pricing services and pricing models, the inputs of which are market-based or independently sourced market parameters, including, but not limited to, yield curves, interest rates, volatilities, prepayments, defaults, cumulative loss projections and cash flows. Such securities are classified in Level 2 of the valuation hierarchy including federal agencies, mortgage-backed securities, municipal securities and Federal Housing Administration participation certificates. In certain cases where Level 1 or Level 2 inputs are not available, securities are classified within Level 3 of the hierarchy. Loans Held for Sale Certain loans held for sale at fair value are saleable into the secondary mortgage markets and their fair values are estimated using observable quoted market or contracted prices, or market price equivalents, which would be used by other market participants. These saleable loans are considered Level 2. Servicing Rights Servicing rights do not trade in an active, open market with readily observable prices. Accordingly, fair value is estimated using discounted cash flow models having significant inputs of discount rate, prepayment speed, cost of servicing, interest rates, and default rate. Due to the nature of the valuation inputs, servicing rights are classified within Level 3 of the hierarchy. The Chief Financial Officer’s (CFO) office contracts with an independent pricing specialist to generate fair value estimates on a quarterly basis. The CFO’s office challenges the reasonableness of the assumptions used and reviews the methodology to ensure the estimated fair value complies with accounting standards generally accepted in the United States. Derivative Financial Instruments Interest rate lock commitments - The Company estimates the fair value of interest rate lock commitments based on the value of the underlying mortgage loan, quoted mortgage-backed security prices, estimates of the fair value of the servicing rights, and an estimate of the probability that the mortgage loan will fund within the terms of the interest rate lock commitment, net of expenses. With respect to its interest rate lock commitments, management determined that a Level 3 classification was most appropriate based on the various significant unobservable inputs utilized in estimating the fair value of its interest rate lock commitments. Forward sales commitments - The Company estimates the fair value of forward sales commitments based on market quotes of mortgage-backed security prices for securities similar to the ones used, which are considered Level 2. Interest rate swaps, caps, and floors (back-to-back) – The Company estimates the fair value of these derivatives made in relation to specific contracts with customers based on prices that are obtained from a third party that uses observable market inputs, thereby supporting a Level 2 classification. Interest rate swaps – The Company estimates the fair value of certain interest rate swaps based on prices that are obtained from a third party that uses observable market inputs, thereby supporting a Level 2 classification. Put options - The fair value of put options are linked to securities available for sale that are accounted for using the fair value option and are classified as either Level 2 or Level 3 on the hierarchy. The put options are classified as Level 2 or Level 3 in the hierarchy, depending upon the magnitude of observable inputs in the valuation of the securities. These valuations are estimated by a third party. Interest rate floors - The fair value of certain interest rate floors is linked to securities available for sale that are accounted for using the fair value option. Other interest rate floors are linked to loans with warehouse customers. The value of the interest rate floors is based on estimated discounted cash flows that are based on inputs that are not readily observable and, thus, are classified as Level 3 on the hierarchy. These valuations are estimated by a third party. Credit Default Swap – The fair value of the credit default swap is linked to the value of its underlying mortgage loans. The Company estimates the fair value based on estimated discounted cash flows that are derived from inputs, including credit spreads that are not readily observable and, thus, are classified as Level 3 on the hierarchy. These valuations are estimated by a third party. Level 3 Reconciliation The following is a reconciliation of the beginning and ending balances of recurring fair value measurements recognized in the accompanying balance sheets using significant unobservable (Level 3) inputs: Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 (In thousands) (In thousands) Servicing rights Balance, beginning of period $ 172,200 $ 143,867 $ 158,457 $ 146,248 Additions Originated servicing 3,761 2,124 5,927 4,297 Subtractions Paydowns (2,252) (2,073) (4,639) (3,771) Changes in fair value 5,067 3,370 19,031 514 Balance, end of period $ 178,776 $ 147,288 $ 178,776 $ 147,288 Securities available for sale - Mortgage-backed - Non-Agency residential - fair value option Balance, beginning of period $ 472,192 $ — $ 485,500 $ — Paydowns (7,884) — (16,870) — Changes in fair value (1,681) — (6,003) — Balance, end of period $ 462,627 $ — $ 462,627 $ — Derivative assets - put options Balance, beginning of period $ 22,976 $ — $ 18,654 $ — Changes in fair value 1,681 — 6,003 — Balance, end of period $ 24,657 $ — $ 24,657 $ — Derivative assets - interest rate floors Balance, beginning of period $ 8,910 $ — $ 6,576 $ — Changes in fair value 214 — 2,548 — Balance, end of period $ 9,124 $ — $ 9,124 $ — Derivative assets - interest rate lock commitments Balance, beginning of period $ 174 $ 218 $ 140 $ 28 Changes in fair value (4) (124) 30 66 Balance, end of period $ 170 $ 94 $ 170 $ 94 Derivative liabilities - interest rate lock commitments Balance, beginning of period $ 22 $ 4 $ 4 $ 23 Changes in fair value 105 64 123 45 Balance, end of period $ 127 $ 68 $ 127 $ 68 Nonrecurring Measurements The following table presents the fair value measurement of assets measured at fair value on a nonrecurring basis and the level within the fair value hierarchy in which the fair value measurements fall at June 30, 2024 and December 31, 2023. Fair Value Measurements Using Quoted Prices in Significant Significant Active Markets for Other Observable Unobservable Fair Identical Assets Inputs Inputs Assets Value (Level 1) (Level 2) (Level 3) (In thousands) June 30, 2024 Collateral dependent loans $ 29,732 $ — $ — $ 29,732 December 31, 2023 Collateral dependent loans $ 47,026 $ — $ — $ 47,026 Following is a description of the valuation methodologies and inputs used for assets measured at fair value on a nonrecurring basis and recognized in the accompanying unaudited condensed consolidated balance sheets, as well as the general classification of such assets pursuant to the valuation hierarchy. For assets classified within Level 3 of the fair value hierarchy, the process used to develop the reported fair value is described below. Collateral Dependent Loans, Net of ACL-Loans The estimated fair value of collateral dependent loans is based on the appraised fair value of the collateral, less estimated cost to sell. Collateral dependent loans are classified within Level 3 of the fair value hierarchy. The Company considers the appraisal or evaluation as the starting point for determining fair value and then considers other factors and events in the environment that may affect the fair value. Appraisals of the collateral underlying collateral-dependent loans are obtained when the loan is determined to be classified as substandard, collateral-dependent and subsequently as deemed necessary by the Chief Credit Officer’s (“CCO)” office. Appraisals and evaluations are reviewed for accuracy and consistency by the CCO’s office. Appraisers are selected from the list of approved appraisers maintained by management. The appraised values are reduced by discounts to consider lack of marketability and estimated cost to sell if repayment or satisfaction of the loan is dependent on the sale of the collateral. These discounts and estimates are developed by the CCO’s office by comparison to historical results. Unobservable (Level 3) Inputs: The following table presents quantitative information about unobservable inputs used in recurring and nonrecurring Level 3 fair value measurements other than goodwill. Valuation Weighted Fair Value Technique Unobservable Inputs Range Average (In thousands) At June 30, 2024: Securities available for sale - Mortgage-backed - Non-Agency residential - fair value option $ 462,627 Discounted cash flow Market credit spread 3% 3% Collateral dependent loans $ 29,732 Market comparable properties Marketability discount 0% - 56% 4% Servicing rights - Multi-family $ 141,160 Discounted cash flow Discount rate 8% - 13% 9% Constant prepayment rate 0% - 62% 7% Servicing rights - Single-family $ 32,654 Discounted cash flow Discount rate 10% - 11% 10% Constant prepayment rate 6% - 15% 7% Servicing rights - SBA $ 4,962 Discounted cash flow Discount rate 16% 16% Constant prepayment rate 3% - 14% 9% Derivative assets: Interest rate lock commitments $ 170 Discounted cash flow Loan closing rates 57% - 99% 83% Put options $ 24,657 Intrinsic option value Market credit spread 3% 3% Interest rate floors $ 9,124 Discounted cash flow Discount rate 6%-9% 7% Derivative liabilities - interest rate lock commitments $ 127 Discounted cash flow Loan closing rates 57% - 99% 83% At December 31, 2023: Securities available for sale - Mortgage-backed - Non-Agency residential - fair value option $ 485,500 Discounted cash flow Market credit spread 2% 2% Collateral dependent loans $ 47,026 Market comparable properties Marketability discount 0% - 100% 2% Servicing rights - Multi-family $ 122,218 Discounted cash flow Discount rate 8% - 13% 9% Constant prepayment rate 0% - 50% 7% Servicing rights - Single-family $ 30,959 Discounted cash flow Discount rate 10% - 11% 10% Constant prepayment rate 6% - 16% 7% Servicing rights - SBA $ 5,280 Discounted cash flow Discount rate 16% 16% Constant prepayment rate 3% - 14% 9% Derivative assets: Interest rate lock commitments $ 140 Discounted cash flow Loan closing rates 45% - 99% 78% Put options $ 18,654 Intrinsic option value Market credit spread 2% 2% Interest rate floors $ 6,576 Discounted cash flow Discount rate 6%-7% 7% Derivative liabilities - interest rate lock commitments $ 4 Discounted cash flow Loan closing rates 45% - 99% 78% Sensitivity of Significant Unobservable Inputs The following is a discussion of the sensitivity of significant unobservable inputs, the interrelationships between those inputs and other unobservable inputs used in recurring fair value measurement, and of how those inputs might magnify or mitigate the effect of changes in the unobservable inputs on the fair value measurement. Securities Available for Sale with a Fair Value Option Election, Loans, and Related Derivative Financial Instruments The significant unobservable input used in the fair value measurement of certain securities available for sale and their related put options include market credit spreads that can be impacted by market conditions and drive a significant amount of a market participant’s valuation of the security and its related put option. The impact of changes to the unobservable inputs for the securities is mitigated by changes to the unobservable inputs for the put options, which are valued in opposite directions, so as to minimize the financial impact to the Company. The significant unobservable input used in the fair value measurement of interest rate floor derivatives associated with certain securities available for sale and loans include the discount rate that can have a significant impact on the value of the derivative. Another variable that affects the floor value is the forward interest curve, which is observable, but changes with market conditions as interest rates and future interest rate expectations change. Servicing Rights The significant unobservable inputs used in the fair value measurement of the Company’s servicing rights are discount rates and constant prepayment rates. These two inputs can drive a significant amount of a market participant’s valuation of servicing rights. Significant increases (decreases) in the discount rate or assumed constant prepayment rates used to value servicing rights would decrease (increase) the value derived. Fair Value of Financial Instruments The following table presents the carrying amount and estimated fair values of the Company’s financial instruments not carried at fair value and the level within the fair value hierarchy in which the fair value measurements fall at June 30, 2024 and December 31, 2023. Fair Value Measurements Using Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Carrying Fair Assets Inputs Inputs Assets Value Value (Level 1) (Level 2) (Level 3) (In thousands) June 30, 2024 Financial assets: Cash and cash equivalents $ 540,882 $ 540,882 $ 540,882 $ — $ — Securities purchased under agreements to resell 3,304 3,304 — 3,304 — Securities held to maturity 1,291,110 1,291,960 — 603,235 688,725 FHLB stock 67,499 67,499 — 67,499 — Loans held for sale 3,380,203 3,380,203 — 3,380,203 — Loans receivable, net 10,933,189 10,888,928 — — 10,888,928 Interest receivable 90,360 90,360 — 90,360 — Financial liabilities: Deposits 14,917,067 14,918,490 8,051,468 6,867,022 — Short-term subordinated debt 68,514 68,514 — 68,514 — FHLB advances 974,008 973,919 — 973,919 — Other borrowing 7,934 7,934 — 7,934 — Credit linked notes 108,750 108,748 — 108,748 — Interest payable 59,226 59,226 — 59,226 — December 31, 2023 Financial assets: Cash and cash equivalents $ 584,422 $ 584,422 $ 584,422 $ — $ — Securities purchased under agreements to resell 3,349 3,349 — 3,349 — Securities held to maturity 1,204,217 1,203,535 — 484,288 719,247 FHLB stock 48,578 48,578 — 48,578 — Loans held for sale 3,058,093 3,058,093 — 3,058,093 — Loans receivable, net 10,127,801 10,088,468 — — 10,088,468 Interest receivable 91,346 91,346 — 91,346 — Financial liabilities: Deposits 14,061,460 14,062,457 8,894,058 5,168,399 — Short-term subordinated debt 64,922 64,922 — 64,922 — FHLB advances 771,392 771,029 — 771,029 — Other borrowing 7,934 7,934 — 7,934 — Credit linked notes 119,879 119,878 — 119,878 — Interest payable 43,423 43,423 — 43,423 — |
Leases
Leases | 6 Months Ended |
Jun. 30, 2024 | |
Leases. | |
Leases | Note 9: Leases The Company has operating leases for various locations with terms ranging from one The Company has operating lease right-of-use assets of $8.0 million and $10.1 million as of June 30, 2024 and December 31, 2023, respectively, and operating lease right-of-use liabilities of $9.1 million and 2024 and December 31, 2023, respectively. Unaudited condensed consolidated balance sheet, income statement and cash flow detail regarding operating leases follows: June 30, 2024 December 31, 2023 Balance Sheet (In thousands) (In thousands) Operating lease right-of-of use asset (in other assets) $ 7,992 $ 10,060 Operating lease liability (in other liabilities) 9,098 11,251 Weighted average remaining lease term (years) 4.7 6.0 Weighted average discount rate 3.25% 2.89% Maturities of lease liabilities: One year or less $ 2,286 $ 2,441 Year two 2,101 2,064 Year three 2,019 2,100 Year four 1,731 2,046 Year five 1,051 1,438 Thereafter 623 2,128 Total future minimum lease payments 9,811 12,217 Less: imputed interest 713 966 Total $ 9,098 $ 11,251 Three Months Ended Three Months Ended June 30, 2024 June 30, 2023 Income Statement (In thousands) (In thousands) Components of lease expense: Operating lease cost (in occupancy and equipment expense) $ 765 $ 666 Six Months Ended Six Months Ended June 30, 2024 June 30, 2023 Income Statement (In thousands) (In thousands) Components of lease expense: Operating lease cost (in occupancy and equipment expense) $ 1,369 $ 1,249 Six Months Ended Six Months Ended June 30, 2024 June 30, 2023 Cash Flow Statement (In thousands) (In thousands) Supplemental cash flow information: Operating cash flows from operating leases $ 1,220 $ 886 |
Deposits
Deposits | 6 Months Ended |
Jun. 30, 2024 | |
Deposits. | |
Deposits | Note 10: Deposits Deposits were comprised of the following at June 30, 2024 and December 31, 2023: June 30, December 31, 2024 2023 (In thousands) Noninterest-bearing deposits Demand deposits $ 383,260 $ 520,070 Total noninterest-bearing deposits 383,260 520,070 Interest-bearing deposits Demand deposits $ 4,779,531 $ 5,381,067 Savings deposits 2,888,677 2,992,921 Certificates of deposit 6,865,599 5,167,402 Total interest-bearing deposits 14,533,807 13,541,390 Total deposits $ 14,917,067 $ 14,061,460 Maturities for certificates of deposit are as follows: June 30, 2024 (In thousands) Due within one year $ 6,760,482 Due in one year to two years 91,157 Due in two years to three years 13,960 Due in three years to four years — Due in four years to five years — Due in five years to six years — $ 6,865,599 Brokered deposit amounts at June 30, 2024 and December 31, 2023, were as follows: June 30, December 31, 2024 2023 (In thousands) Brokered certificates of deposit $ 6,119,391 $ 4,465,825 Brokered savings deposits 948 589 Brokered deposit on demand accounts — 1,504,230 $ 6,120,339 $ 5,970,644 |
Borrowings
Borrowings | 6 Months Ended |
Jun. 30, 2024 | |
Borrowings | |
Borrowings | Note 11: Borrowings Borrowings were comprised of the following at June 30, 2024 and December 31, 2023: June 30, December 31, 2024 2023 (In thousands) Short-term subordinated debt $ 68,514 $ 64,922 FHLB advances 974,008 771,392 Credit linked notes, net of debt discount 108,750 119,879 Other borrowings 7,934 7,934 Total borrowings $ 1,159,206 $ 964,127 On May 21, 2024, the Company entered into a new variable rate debt agreement with the FHLB for an advance that has put and call options attached to it. The balance of the advance was $500.0 million as of June 30, 2024, and matures on August 19, 2024. The variable interest rate is based on the Federal Funds effective rate, plus 15 basis points, which was 5.48% as of June 30, 2024. The FHLB has an option to cancel the agreement 60 days after the initial execution date and the Company has an option to cancel the agreement at any time, with one day ’s notice. |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Jun. 30, 2024 | |
Earnings Per Share | |
Earnings Per Share | Note 12: Earnings Per Share Earnings per share were computed as follows: Three Month Periods Ended June 30, 2024 2023 Weighted- Per Weighted- Per Net Average Share Net Average Share Income Shares Amount Income Shares Amount (In thousands, except share data) Net income $ 76,393 $ 65,302 Dividends on preferred stock (7,757) (8,668) Preferred stock redemption (1,823) — Net income available to common shareholders $ 66,813 $ 56,634 Basic earnings per share 44,569,345 $ 1.50 43,235,398 $ 1.31 Effect of dilutive securities-restricted stock awards 128,979 73,995 Diluted earnings per share 44,698,324 $ 1.49 43,309,393 $ 1.31 Six Month Periods Ended June 30, 2024 2023 Weighted- Per Weighted- Per Net Average Share Net Average Share Income Shares Amount Income Shares Amount (In thousands, except share data) Net income $ 163,447 $ 120,257 Dividends on preferred stock (16,424) (17,335) Preferred stock redemption (1,823) — Net income available to common shareholders $ 145,200 $ 102,922 Basic earnings per share 43,937,665 $ 3.30 43,207,655 $ 2.38 Effect of dilutive securities-restricted stock awards 144,820 92,585 Diluted earnings per share 44,082,485 $ 3.29 43,300,240 $ 2.38 |
Common Stock
Common Stock | 6 Months Ended |
Jun. 30, 2024 | |
Common Stock | |
Common Stock | Note 13: Common Stock Public Offerings of Common Stock: On May 13, 2024, the Company issued 2,400,000 shares of the Company’s common stock, without par value, at a public offering price of $43.00 per share in an underwritten public offering. The aggregate gross offering proceeds for the shares issued by the Company was $103.2 million, and after deducting underwriting discounts, commissions, and offering expenses of $5.5 million paid to third parties, the Company received total net proceeds of $97.7 million. |
Preferred Stock
Preferred Stock | 6 Months Ended |
Jun. 30, 2024 | |
Preferred Stock. | |
Preferred Stock | Note 14: Preferred Stock Public Offerings of Preferred Stock: Series A “Series A Preferred Stock”). The aggregate gross offering proceeds for the shares issued by the Company was $50.0 million, and after deducting underwriting discounts and commissions and offering expenses of approximately $1.7 million paid to third parties, the Company received total net proceeds of $48.3 million. On April 12, 2019, the Company issued an additional 81,800 shares of Series A Preferred Stock to the underwriters related to their exercise of an option to purchase additional shares under the associated underwriting agreement, resulting in an additional $2.0 million in net proceeds, after deducting $41,000 in underwriting discounts. The Company redeemed all outstanding shares of the Series A Preferred Stock on April 1, 2024 at a price equal to the liquidation preference of $25.00 per share, or $52 million, using cash on hand. Series B 1/40 th The Series B Preferred Stock have no voting rights with respect to matters that generally require the approval of common shareholders. Dividends on the Series B Preferred Stock, to the extent declared by the Company’s board, are payable quarterly. The Company may redeem the Series B Preferred Stock, in whole or in part, at its option, on any dividend payment date on or after October 1, 2024, subject to the approval of the appropriate federal banking agency, at the liquidation preference, plus any declared and unpaid dividends (without regard to any undeclared dividends) to, but excluding, the date of redemption. Series C 1/40th The Series C Preferred Stock have no voting rights with respect to matters that generally require the approval of common shareholders. Dividends on the Series C Preferred Stock, to the extent declared by the Company’s board, are payable quarterly. The Company may redeem the Series C Preferred Stock, in whole or in part, at its option, on any dividend payment date on or after April 1, 2026, subject to the approval of the appropriate federal banking agency, at the liquidation preference, plus any declared and unpaid dividends (without regard to any undeclared dividends) to, but excluding, the date of redemption. Series D 1/40 th The Series D Preferred Stock have no voting rights with respect to matters that generally require the approval of common shareholders. Dividends on the Series D Preferred Stock, to the extent declared by the Company’s board, are payable quarterly. The Company may redeem the Series D Preferred Stock, in whole or in part, at its option, on any dividend payment date on or after October 1, 2027, subject to the approval of the appropriate federal banking agency, at the liquidation preference, plus any declared and unpaid dividends (without regard to any undeclared dividends) to, but excluding, the date of redemption. |
Share-Based Payment Plans
Share-Based Payment Plans | 6 Months Ended |
Jun. 30, 2024 | |
Share-Based Payment Plans | |
Share-Based Payment Plans | Note 15: Share-Based Payment Plans Equity-based incentive awards for Company officers are currently issued pursuant to the 2017 Equity Incentive Plan (the “2017 Incentive Plan”). During the three months ended June 30, 2024 and 2023, the Company did no t issue any shares. During the six months ended June 30, 2024 and 2023, the Company issued During 2018, the Compensation Committee of the Board of Directors approved a plan for non-executive directors to receive a portion of their annual retainer fees in the form of shares of common stock. In November 2023, the Board of Directors amended the plan for nonexecutive directors to receive a portion of their annual fees, issued quarterly, in the form of restricted common stock equal to $70,000 per member, rounded up to the nearest whole share, to be effective as of January 1, 2024. Accordingly, there were 2024 and 2023, respectively. The Company established an employee stock ownership plan (“ESOP”) effective as of January 1, 2020 to provide certain benefits for all employees who meet certain requirements. There was no contribution to the ESOP during the three months ended June 30, 2024 and 2023. Expenses recognized for the contribution to the ESOP totaled $573,000 and $519,000 for the six months ended June 30, 2024 and 2023, respectively. The Company contributed 23,414 shares and 33,293 shares to the ESOP for the six months ended June 30, 2024 and 2023, respectively. |
Segment Information
Segment Information | 6 Months Ended |
Jun. 30, 2024 | |
Segment Information | |
Segment Information | Note 16: Segment Information The Company’s business segments are defined as Multi-family Mortgage Banking, Mortgage Warehousing, and Banking. The reportable business segments are consistent with the internal reporting and evaluation of the principal lines of business of the Company. The Multi-family Mortgage Banking segment originates and services government sponsored mortgages for multi-family and healthcare facilities. It is also a fully integrated syndicator of low-income housing tax credit and debt funds. The Mortgage Warehousing segment funds agency eligible residential loans from the date of origination or purchase, until the date of sale in the secondary market, as well as commercial loans to non-depository financial institutions. The Banking segment provides a wide range of financial products and services to consumers and businesses, including retail banking, commercial lending, agricultural lending, retail and correspondent residential mortgage banking, and Small Business Administration (“SBA”) lending. The Other segment includes general and administrative expenses that provide services to all segments; internal funds transfer pricing offsets resulting from allocations to/from the other segments, certain elimination entries and investments in qualified affordable housing limited partnerships or LLCs and certain debt funds. All operations are domestic. The tables below present selected business segment financial information for the three and six months ended June 30, 2024 and 2023. Multi-family Mortgage Mortgage Banking Warehousing Banking Other Total Three Months Ended June 30, 2024 (In thousands) Interest income $ 1,135 $ 101,164 $ 222,785 $ 3,189 $ 328,273 Interest expense 20 68,184 132,742 (792) 200,154 Net interest income 1,115 32,980 90,043 3,981 128,119 Provision for credit losses — 995 8,970 — 9,965 Net interest income after provision for credit losses 1,115 31,985 81,073 3,981 118,154 Noninterest income 31,983 1,746 1,194 (3,572) 31,351 Noninterest expense 20,651 4,674 14,985 10,070 50,380 Income (loss) before income taxes 12,447 29,057 67,282 (9,661) 99,125 Income taxes 3,410 6,787 14,904 (2,369) 22,732 Net income (loss) $ 9,037 $ 22,270 $ 52,378 $ (7,292) $ 76,393 Total assets $ 428,299 $ 5,626,055 $ 11,885,484 $ 272,584 $ 18,212,422 Multi-family Mortgage Mortgage Banking Warehousing Banking Other Total Three Months Ended June 30, 2023 (In thousands) Interest income $ 1,248 $ 64,267 $ 191,406 $ 1,148 $ 258,069 Interest expense 13 42,984 111,311 (1,856) 152,452 Net interest income 1,235 21,283 80,095 3,004 105,617 Provision for credit losses — 2,320 20,283 — 22,603 Net interest income after provision for credit losses 1,235 18,963 59,812 3,004 83,014 Noninterest income 30,325 2,872 (760) (2,555) 29,882 Noninterest expense 19,962 3,617 12,118 8,623 44,320 Income (loss) before income taxes 11,598 18,218 46,934 (8,174) 68,576 Income taxes 356 (378) 4,284 (988) 3,274 Net income (loss) $ 11,242 $ 18,596 $ 42,650 $ (7,186) $ 65,302 Total assets $ 373,680 $ 4,474,832 $ 10,784,596 $ 241,764 $ 15,874,872 Multi-family Mortgage Mortgage Banking Warehousing Banking Other Total (In thousands) Six Months Ended June 30, 2024 Interest income $ 2,881 $ 186,065 447,073 $ 6,427 $ 642,446 Interest expense 40 124,324 264,465 (1,558) 387,271 Net interest income 2,841 61,741 182,608 7,985 255,175 Provision for credit losses — 1,935 12,756 — 14,691 Net interest income after provision for credit losses 2,841 59,806 169,852 7,985 240,484 Noninterest income 72,450 5,063 1,623 (6,911) 72,225 Noninterest expense 40,222 9,472 30,563 19,035 99,292 Income (loss) before income taxes 35,069 55,397 140,912 (17,961) 213,417 Income taxes 9,423 12,937 32,109 (4,499) 49,970 Net income (loss) $ 25,646 $ 42,460 $ 108,803 $ (13,462) $ 163,447 Total assets $ 428,299 $ 5,626,055 $ 11,885,484 $ 272,584 $ 18,212,422 Multi-family Mortgage Mortgage Banking Warehousing Banking Other Total (In thousands) Six Months Ended June 30, 2023 Interest income $ 2,354 $ 106,585 $ 358,132 $ 2,292 $ 469,363 Interest expense 13 70,778 195,837 (3,575) 263,053 Net interest income 2,341 35,807 162,295 5,867 206,310 Provision for credit losses — 3,684 25,786 — 29,470 Net interest income after provision for credit losses 2,341 32,123 136,509 5,867 176,840 Noninterest income 46,922 3,905 (1,949) (4,732) 44,146 Noninterest expense 34,593 6,372 22,288 15,839 79,092 Income (loss) before income taxes 14,670 29,656 112,272 (14,704) 141,894 Income taxes 1,462 2,419 20,315 (2,559) 21,637 Net income (loss) $ 13,208 $ 27,237 $ 91,957 $ (12,145) $ 120,257 Total assets $ 373,680 $ 4,474,832 $ 10,784,596 $ 241,764 $ 15,874,872 |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 6 Months Ended |
Jun. 30, 2024 | |
Recent Accounting Pronouncements | |
Recent Accounting Pronouncements | Note 17: Recent Accounting Pronouncements The Company continually monitors potential accounting pronouncement and SEC release changes. The following pronouncements and releases have been deemed to have the most applicability to the Company’s financial statements: FASB ASU 2023-07 - Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures In November 2023, the FASB issued an ASU update that will require public entities’ disclosures, on an annual and interim basis, to include additional details on reportable segments so financial statement users may better understand an entity’s overall performance and assist in assessing potential future cash flows. The new guidance will require public entities to present information regarding significant segment expenses that are regularly provided to the chief operating decision maker (CODM) as well as details regarding segment’s profit and loss. The updates in ASU 2023-07 are effective for annual periods beginning after December 15, 2023 and interim periods for years beginning after December 15, 2024. An entity shall apply the ASU retrospectively to financial statements for periods beginning after the effective date. The Company is continuing to evaluate the impact of adopting this new guidance but does not expect it to have a material impact on the Company’s financial position or results of operations. FASB ASU 2023-09 - Income Taxes (Topic 740): Improvements to Income Tax Disclosures In December 2023, the FASB issued an ASU update that will require public business entity’s disclosures to include a tabular tax rate reconciliation. The update will also require all public entities disclose income tax expense and taxes paid broken down by federal, state, and foreign with a disaggregation for jurisdictions that exceed 5% of income for taxes paid. The updates in ASU 2023-09 are effective for annual periods beginning after December 15, 2024. An entity shall apply the ASU on a prospective basis to financial statements for annual periods beginning after the effective date. The Company is continuing to evaluate the impact of adopting this new guidance but does not expect it to have a material impact on the Company’s financial position or results of operations . |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2024 | |
Subsequent Events | |
Subsequent Events | Note 18: Subsequent Events No material events were noted. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Pay vs Performance Disclosure | ||||
Net Income (Loss) | $ 76,393 | $ 65,302 | $ 163,447 | $ 120,257 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Jun. 30, 2024 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 6 Months Ended |
Jun. 30, 2024 | |
Basis of Presentation | |
Sale of Farmers-Merchants Bank of Illinois branches | Sale of Farmers-Merchants Bank of Illinois branches On September 7, 2023, the Company entered into an agreement with Bank of Pontiac to sell its Farmers-Merchants Bank of Illinois branch locations in Paxton, Melvin, and Piper City, Illinois, and into an agreement with CBI Bank & Trust, to sell its Farmers-Merchants Bank of Illinois branch located in Joy, Illinois. This transaction enhanced the Company’s ability to focus on its core business of single and multi-family mortgage lending and strategically aligned the branches with institutions that share a similar business model and allowed them to provide additional products to their customers. On January 26, 2024, the transaction was completed after having met customary closing conditions, including regulatory approval. In addition to the branches, Bank of Pontiac acquired approximately $164.8 million in deposits and $19.2 million in loans, and CBI Bank & Trust acquired approximately $65.1 million in deposits and $28.6 million in loans. Total assets and liabilities of approximately $60.8 million and $230.6 million, respectively, were sold. A net gain of $715,000 was recognized from the transactions, which includes a $10.1 million deposit premium and the extinguishment of $7.8 million in goodwill and $0.5 million in intangibles during the first quarter of 2024. |
Principles of Consolidation | Principles of Consolidation The unaudited condensed consolidated financial statements as of and for the period ended June 30, 2024 and 2023 include results from the Company, and its wholly owned subsidiaries, Merchants Bank, FMBI (until its branches were sold and its bank charter merged into Merchants Bank on January 26, 2024), and MAM. Also included are Merchants Bank’s primary operating subsidiaries, MCC, MCS, and MCI, as well as all direct and indirectly owned subsidiaries owned by Merchants Bancorp. During 2022, Merchants Foundation, Inc., a nonprofit corporation, was incorporated and its results are consolidated with the Company’s consolidated financial statements in all periods presented. In addition, when the Company makes an equity investment in or has a relationship with an entity for which it holds a variable interest, it is evaluated for consolidation requirements under Accounting Standards Update (“ASU”) Topic 810. Accordingly, the Company assesses the entities for potential consolidation as a variable interest entity (“VIE”) and would only consolidate those entities for which it is a primary beneficiary. A primary beneficiary is defined as the party that has both the power to direct the activities that most significantly impact the entity, and an interest that could be significant to the entity. To determine if an interest could be significant to the entity, both qualitative and quantitative factors regarding the nature, size and form of the Company’s involvement with the entity are evaluated. Alternatively, under the voting interest model, it would only consolidate those entities for which it has a controlling interest. In May 2023, the Company acquired a variable interest in an investment for which it is the primary beneficiary of, and its results have been consolidated since the date of acquisition. Additionally, the Company has certain variable interest investments that it was deemed not to be a primary beneficiary of as of June 30, 2024 and December 31, 2023. These VIEs are not consolidated and the equity or proportional method of accounting has been applied. The Company will analyze whether the primary beneficiary designation has changed through triggering events on a prospective basis. Changes in facts and circumstances occurring since the previous primary beneficiary determination will be considered as part of this ongoing assessment. See Note 5: Variable Interest Entities (VIEs) for additional information about VIEs. All significant intercompany accounts and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for credit losses on loans and fair values of servicing rights and financial instruments. |
Significant Accounting Policies | Significant Accounting Policies The significant accounting policies followed by the Company for interim financial reporting are consistent with the accounting policies followed for annual financial reporting. For additional information regarding significant accounting policies, see the Company’s 2023 Annual Report on Form 10–K . |
Restricted Cash | Restricted Cash Included in cash equivalents is an account restricted as collateral for the potential risk of loss on senior credit linked notes issued by the Company. The balance of the notes as of June 30, 2024 was $112.3 million. As of June 30, 2024, there was $37.0 million in restricted cash held in a separate account included in the total of interest-earning demand accounts on the Balance Sheet. Also see Note 11: Borrowings . |
Investment Securities (Tables)
Investment Securities (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Investment Securities | |
Schedule of amortized cost and approximate fair values, together with gross unrealized gains and losses | June 30, 2024 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value (In thousands) Securities available for sale: Treasury notes $ 109,067 $ 12 $ — $ 109,079 Federal agencies 220,000 1 683 219,318 Mortgage-backed - Government Agency ("Agency") (2) 5,848 — — 5,848 Mortgage-backed - Non-Agency residential - fair value option (1) 462,627 — — 462,627 Mortgage-backed - Agency - residential - fair value option (1) 220,147 — — 220,147 Total securities available for sale $ 1,017,689 $ 13 $ 683 $ 1,017,019 Securities held to maturity: Mortgage-backed - Non-Agency - multi-family $ 689,249 $ — $ 524 $ 688,725 Mortgage-backed - Non-Agency - residential 589,925 2,397 81 592,241 Mortgage-backed - Agency 11,936 — 942 10,994 Total securities held to maturity $ 1,291,110 $ 2,397 $ 1,547 $ 1,291,960 (1) Fair value option securities represent securities which the Company has elected to carry at fair value with changes in the fair value recognized in earnings as they occur. (2) Agency includes government sponsored agencies, such as Federal National Mortgage Association (“Fannie Mae”), Federal Home Loan Mortgage Corporation (“Freddie Mac”), and Government National Mortgage Association (“Ginnie Mae”). December 31, 2023 Gross Gross Amortized Unrealized Unrealized Fair Cost Gains Losses Value (In thousands) Securities available for sale: Treasury notes $ 129,261 $ 45 $ 338 $ 128,968 Federal agencies 250,731 — 2,976 247,755 Mortgage-backed - Government Agency ("Agency") (2) 14,465 5 3 14,467 Mortgage-backed - Non-Agency residential - fair value option (1) 485,500 — — 485,500 Mortgage-backed - Agency - residential - fair value option (1) 236,997 — — 236,997 Total securities available for sale $ 1,116,954 $ 50 $ 3,317 $ 1,113,687 Securities held to maturity: Mortgage-backed - Non-Agency - multi-family $ 719,662 $ — $ 415 $ 719,247 Mortgage-backed - Non-Agency - residential 472,539 973 418 473,094 Mortgage-backed - Agency 12,016 — 822 11,194 Total securities held to maturity $ 1,204,217 $ 973 $ 1,655 $ 1,203,535 (1) Fair value option securities represent securities which the Company has elected to carry at fair value with changes in the fair value recognized in earnings as they occur. (2) Agency includes government sponsored agencies, such as Fannie Mae, Freddie Mac, and Ginnie Mae. |
Schedule of amortized cost and fair value of available-for-sale securities and held to maturity securities by contractual maturity | June 30, 2024 December 31, 2023 Amortized Fair Amortized Fair Cost Value Cost Value Securities available for sale: (In thousands) Within one year $ 189,067 $ 188,522 $ 308,474 $ 305,406 After one through five years 140,000 139,875 71,518 71,317 329,067 328,397 379,992 376,723 Mortgage-backed - Agency 5,848 5,848 14,465 14,467 Mortgage-backed - Non-Agency residential - fair value option 462,627 462,627 485,500 485,500 Mortgage-backed - Agency - residential - fair value option 220,147 220,147 236,997 236,997 $ 1,017,689 $ 1,017,019 $ 1,116,954 $ 1,113,687 Securities held to maturity: Mortgage-backed - Non-Agency - multi-family $ 689,249 $ 688,725 $ 719,662 $ 719,247 Mortgage-backed - Non-Agency - residential 589,925 592,241 472,539 473,094 Mortgage-backed - Agency 11,936 10,994 12,016 11,194 $ 1,291,110 $ 1,291,960 $ 1,204,217 $ 1,203,535 |
Schedule of gross unrealized losses and fair value of investments with unrealized losses have been in continuous | June 30, 2024 12 Months or Less than 12 Months Longer Total Gross Gross Gross Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses (In thousands) Securities available for sale: Federal agencies $ 114,874 $ 126 $ 79,443 $ 557 $ 194,317 $ 683 $ 114,874 $ 126 $ 79,443 $ 557 $ 194,317 $ 683 December 31, 2023 12 Months or Less than 12 Months Longer Total Gross Gross Gross Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses (In thousands) Securities available for sale: Treasury notes $ 3,052 $ 6 $ 32,080 $ 332 $ 35,132 $ 338 Federal agencies 60,541 189 167,213 2,787 227,754 2,976 Mortgage-backed - Agency 364 1 186 2 550 3 $ 63,957 $ 196 $ 199,479 $ 3,121 $ 263,436 $ 3,317 |
Loans and Allowance for Credi_2
Loans and Allowance for Credit Losses on Loans (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Loans and Allowance for Credit Losses on Loans | |
Schedule of loans | June 30, December 31, 2024 2023 (In thousands) Mortgage warehouse repurchase agreements $ 1,369,965 $ 752,468 Residential real estate 1,345,656 1,324,305 Multi-family financing 4,160,420 4,006,160 Healthcare financing 2,495,910 2,356,689 Commercial and commercial real estate 1,566,809 1,643,081 Agricultural production and real estate 70,244 103,150 Consumer and margin loans 5,213 13,700 11,014,217 10,199,553 Less: ACL-Loans 81,028 71,752 Loans Receivable $ 10,933,189 $ 10,127,801 (1) Includes $1.2 billion and $1.2 billion of All-in-One © first-lien home equity lines of credit at June 30, 2024 and December 31, 2023, respectively. (2) Includes $1.0 billion and $1.1 billion of revolving lines of credit collateralized primarily by mortgage servicing rights as of June 30, 2024 and December 31, 2023, respectively. (3) Includes only $6.8 million and $8.4 million of non-owner occupied commercial real estate as of June 30, 2024 and December 31, 2023, respectively. |
Schedule of allowance for credit loss on loan methodology by loan portfolio segment | Loan Portfolio Segment ACL-Loans Methodology Mortgage warehouse repurchase agreements Remaining Life Method Residential real estate loans Discounted Cash Flow Multi-family financing Discounted Cash Flow Healthcare financing Discounted Cash Flow Commercial and commercial real estate Discounted Cash Flow Agricultural production and real estate Remaining Life Method Consumer and margin loans Remaining Life Method |
Schedule of the activity in the ACL-Loans by portfolio segment | For the Three Months Ended June 30, 2024 MTG WHRA RES RE MF FIN HC FIN CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) ACL-Loans Balance, beginning of period $ 3,022 $ 6,905 $ 28,664 $ 24,587 $ 11,990 $ 450 $ 94 $ 75,712 Provision for credit losses 594 (595) 9,097 (1,065) 702 39 (19) 8,753 Loans charged to the allowance — — (3,349) — (103) — — (3,452) Recoveries of loans previously charged-off — 13 — — 2 — — 15 Balance, end of period $ 3,616 $ 6,323 $ 34,412 $ 23,522 $ 12,591 $ 489 $ 75 $ 81,028 For the Three Months Ended June 30, 2023 MTG WHRA RES RE MF FIN HC FIN CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) ACL-Loans Balance, beginning of period $ 1,664 $ 7,378 $ 19,851 $ 11,753 $ 10,482 $ 543 $ 167 $ 51,838 Provision for credit losses 1,697 48 13,250 4,370 1,329 13 (29) 20,678 Loans charged to the allowance — (13) (8,400) — (1,118) — (1) (9,532) Recoveries of loans previously charged-off — — — — 2 — — 2 Balance, end of period $ 3,361 $ 7,413 $ 24,701 $ 16,123 $ 10,695 $ 556 $ 137 $ 62,986 For the Six Months Ended June 30, 2024 MTG WHRA RES RE MF FIN HC FIN CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) ACL-Loans Balance, beginning of period $ 2,070 $ 7,323 $ 26,874 $ 22,454 $ 12,243 $ 619 $ 169 $ 71,752 FMBI's ACL for loans sold — (55) (186) (2) (92) (246) (12) (593) Provision for credit losses 1,546 (958) 11,073 1,070 1,465 116 (82) 14,230 Loans charged to the allowance — — (3,349) — (1,028) — — (4,377) Recoveries of loans previously charged-off — 13 — — 3 — — 16 Balance, end of period $ 3,616 $ 6,323 $ 34,412 $ 23,522 $ 12,591 $ 489 $ 75 $ 81,028 For the Six Months Ended June 30, 2023 MTG WHRA RES RE MF FIN HC FIN CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) ACL-Loans Balance, beginning of period $ 1,249 $ 7,029 $ 16,781 $ 9,882 $ 8,326 $ 565 $ 182 $ 44,014 Provision for credit losses 2,112 397 16,320 6,241 3,478 (9) (44) 28,495 Loans charged to the allowance — (13) (8,400) — (1,118) — (1) (9,532) Recoveries of loans previously charged-off — — — — 9 — — 9 Balance, end of period $ 3,361 $ 7,413 $ 24,701 $ 16,123 $ 10,695 $ 556 $ 137 $ 62,986 |
Schedule of activity in the allowance for loans losses by loan portfolio | For the Year Ended December 31, 2023 MTG WHRA RES RE MF FIN HC FIN CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) ACL-Loans Balance, beginning of period $ 1,249 $ 7,029 $ 16,781 $ 9,882 $ 8,326 $ 565 $ 182 $ 44,014 Provision for credit losses 821 328 18,493 12,572 5,232 54 (12) 37,488 Loans charged to the allowance — (34) (8,400) — (1,356) — (1) (9,791) Recoveries of loans previously charged-off — — — — 41 — — 41 Balance, end of period $ 2,070 $ 7,323 $ 26,874 $ 22,454 $ 12,243 $ 619 $ 169 $ 71,752 |
Schedule of allowance for credit loss allocated to collateral dependent loans | June 30, 2024 Real Estate Accounts Receivable / Equipment Other Total ACL-Loans Allocation (In thousands) RES RE $ 5,752 $ — $ — $ 5,752 $ 31 MF FIN 160,497 — 693 161,190 4,752 HC FIN 73,409 — — 73,409 5,798 CML & CRE 1,343 2,422 2,576 6,341 1,979 AG & AGRE 147 — — 147 1 Total collateral dependent loans $ 241,148 $ 2,422 $ 3,269 $ 246,839 $ 12,561 December 31, 2023 Real Estate Accounts Receivable / Equipment Other Total ACL-Loans Allocation (In thousands) RES RE $ 1,557 $ — $ 3 $ 1,560 $ 21 MF FIN 46,575 — — 46,575 521 HC FIN 73,909 — — 73,909 6,289 CML & CRE 146 3,603 2,684 6,433 1,132 AG & AGRE 147 — — 147 1 CON & MAR — — 3 3 — Total collateral dependent loans $ 122,334 $ 3,603 $ 2,690 $ 128,627 $ 7,964 |
Schedule of credit risk profile of loan portfolio | June 30, 2024 2024 2023 2022 2021 2020 Prior Revolving Loans TOTAL (In thousands) MTG WHRA Pass $ — $ — $ — $ — $ — $ — $ 1,369,965 $ 1,369,965 Total $ — $ — $ — $ — $ — $ — $ 1,369,965 $ 1,369,965 Charge-offs $ — $ — $ — $ — $ — $ — $ — $ — RES RE Pass $ 16,683 $ 33,162 $ 8,370 $ 5,921 $ 20,799 $ 7,063 $ 1,247,690 $ 1,339,688 Special Mention — — — — — 216 — 216 Substandard — — 22 — — — 5,730 5,752 Total $ 16,683 $ 33,162 $ 8,392 $ 5,921 $ 20,799 $ 7,279 $ 1,253,420 $ 1,345,656 Charge-offs $ — $ — $ — $ — $ — $ — $ — $ — MF FIN Pass $ 514,012 $ 800,439 $ 658,884 $ 115,723 $ 6,760 $ 34,139 $ 1,768,242 $ 3,898,199 Special Mention 29,010 16,869 29,853 — — 1,463 23,836 101,031 Substandard — 81,392 70,502 2,557 — — 6,739 161,190 Total $ 543,022 $ 898,700 $ 759,239 $ 118,280 $ 6,760 $ 35,602 $ 1,798,817 $ 4,160,420 Charge-offs $ — $ 870 $ 2,479 $ — $ — $ — $ — $ 3,349 HC FIN Pass $ 424,343 $ 456,170 $ 901,647 $ 75,333 $ — $ 14,356 $ 415,686 $ 2,287,535 Special Mention 24,585 67,000 24,844 — — — 18,537 134,966 Substandard — 36,650 — 28,458 — — 8,301 73,409 Total $ 448,928 $ 559,820 $ 926,491 $ 103,791 $ — $ 14,356 $ 442,524 $ 2,495,910 Charge-offs $ — $ — $ — $ — $ — $ — $ — $ — CML & CRE Pass $ 29,422 $ 48,441 $ 110,317 $ 62,237 $ 18,746 $ 24,177 $ 1,259,341 $ 1,552,681 Special Mention — 112 — 7,190 — 58 427 7,787 Substandard — — 269 1,953 822 57 3,240 6,341 Total $ 29,422 $ 48,553 $ 110,586 $ 71,380 $ 19,568 $ 24,292 $ 1,263,008 $ 1,566,809 Charge-offs $ — $ — $ 103 $ 925 $ — $ — $ — $ 1,028 AG & AGRE Pass $ 13,636 $ 7,246 $ 4,855 $ 2,601 $ 8,482 $ 14,688 $ 18,589 $ 70,097 Substandard — — — — — 147 — 147 Total $ 13,636 $ 7,246 $ 4,855 $ 2,601 $ 8,482 $ 14,835 $ 18,589 $ 70,244 Charge-offs $ — $ — $ — $ — $ — $ — $ — $ — CON & MAR Pass $ 174 $ 92 $ 25 $ 21 $ — $ 4,230 $ 671 $ 5,213 Total $ 174 $ 92 $ 25 $ 21 $ — $ 4,230 $ 671 $ 5,213 Charge-offs $ — $ — $ — $ — $ — $ — $ — $ — Total Pass $ 998,270 $ 1,345,550 $ 1,684,098 $ 261,836 $ 54,787 $ 98,653 $ 6,080,184 $ 10,523,378 Total Special Mention $ 53,595 $ 83,981 $ 54,697 $ 7,190 $ — $ 1,737 $ 42,800 $ 244,000 Total Substandard $ — $ 118,042 $ 70,793 $ 32,968 $ 822 $ 204 $ 24,010 $ 246,839 Total Doubtful $ — $ — $ — $ — $ — $ — $ — $ — Total Loans $ 1,051,865 $ 1,547,573 $ 1,809,588 $ 301,994 $ 55,609 $ 100,594 $ 6,146,994 $ 11,014,217 Total Charge-offs $ — $ 870 $ 2,582 $ 925 $ — $ — $ — $ 4,377 December 31, 2023 2023 2022 2021 2020 2019 Prior Revolving Loans TOTAL (In thousands) MTG WHRA Pass $ — $ — $ — $ — $ — $ — $ 752,468 $ 752,468 Total $ — $ — $ — $ — $ — $ — $ 752,468 $ 752,468 Charge-offs $ — $ — $ — $ — $ — $ — $ — $ — RES RE Pass $ 31,011 $ 10,086 $ 6,573 $ 22,725 $ 3,298 $ 9,340 $ 1,239,161 $ 1,322,194 Special Mention — — — — 59 492 — 551 Substandard — — — — — 288 1,272 1,560 Total $ 31,011 $ 10,086 $ 6,573 $ 22,725 $ 3,357 $ 10,120 $ 1,240,433 $ 1,324,305 Charge-offs $ — $ — $ — $ — $ — $ 21 $ 13 $ 34 MF FIN Pass $ 1,094,698 $ 762,448 $ 208,343 $ 77,340 $ 29,764 $ 8,455 $ 1,646,445 $ 3,827,493 Special Mention 94,973 3,189 8,400 — — 1,477 24,052 132,091 Substandard 11,682 28,360 6,534 — — — — 46,576 Total $ 1,201,353 $ 793,997 $ 223,277 $ 77,340 $ 29,764 $ 9,932 $ 1,670,497 $ 4,006,160 Charge-offs $ — $ 8,400 $ — $ — $ — $ — $ — $ 8,400 HC FIN Pass $ 752,591 $ 996,273 $ 110,197 $ — $ 14,563 $ — $ 351,110 $ 2,224,734 Special Mention 35,869 9,520 — — — — 12,658 58,047 Substandard 25,600 10,625 28,783 — — — 8,900 73,908 Total $ 814,060 $ 1,016,418 $ 138,980 $ — $ 14,563 $ — $ 372,668 $ 2,356,689 Charge-offs $ — $ — $ — $ — $ — $ — $ — $ — CML & CRE Pass $ 51,110 $ 119,386 $ 77,316 $ 21,154 $ 21,088 $ 17,066 $ 1,328,980 $ 1,636,100 Special Mention — — 292 172 — 84 — 548 Substandard — 70 1,701 878 62 — 3,672 6,383 Doubtful — — — — — 50 — 50 Total $ 51,110 $ 119,456 $ 79,309 $ 22,204 $ 21,150 $ 17,200 $ 1,332,652 $ 1,643,081 Charge-offs $ — $ 496 $ 274 $ 586 $ — $ — $ — $ 1,356 AG & AGRE Pass $ 16,850 $ 9,825 $ 6,490 $ 14,267 $ 5,237 $ 16,606 $ 33,728 $ 103,003 Special Mention — — — — — — — — Substandard — — — — — 147 — 147 Total $ 16,850 $ 9,825 $ 6,490 $ 14,267 $ 5,237 $ 16,753 $ 33,728 $ 103,150 Charge-offs $ — $ — $ — $ — $ — $ — $ — $ — CON & MAR Pass $ 748 $ 4,329 $ 247 $ 115 $ 27 $ 4,339 $ 3,862 $ 13,667 Special Mention — — — 15 15 — — 30 Substandard — — — — — 3 — 3 Total $ 748 $ 4,329 $ 247 $ 130 $ 42 $ 4,342 $ 3,862 $ 13,700 Charge-offs $ — $ — $ — $ — $ — $ 1 $ — $ 1 Total Pass $ 1,947,008 $ 1,902,347 $ 409,166 $ 135,601 $ 73,977 $ 55,806 $ 5,355,754 $ 9,879,659 Total Special Mention $ 130,842 $ 12,709 $ 8,692 $ 187 $ 74 $ 2,053 $ 36,710 $ 191,267 Total Substandard $ 37,282 $ 39,055 $ 37,018 $ 878 $ 62 $ 438 $ 13,844 $ 128,577 Total Doubtful $ — $ — $ — $ — $ — $ 50 $ — $ 50 Total Loans $ 2,115,132 $ 1,954,111 $ 454,876 $ 136,666 $ 74,113 $ 58,347 $ 5,406,308 $ 10,199,553 Total Charge-offs $ — $ 8,896 $ 274 $ 586 $ — $ 22 $ 13 $ 9,791 |
Schedule of aging analysis of the recorded investment in loans | June 30, 2024 30-59 Days 60-89 Days 90+ Days Total Total Past Due Past Due Past Due Past Due Current Loans (In thousands) MTG WHRA $ — $ — $ — $ — $ 1,369,965 $ 1,369,965 RES RE — 1,026 5,244 6,270 1,339,386 1,345,656 MF FIN 40,743 40,719 69,146 150,608 4,009,812 4,160,420 HC FIN — 25,601 47,809 73,410 2,422,500 2,495,910 CML & CRE — 445 3,959 4,404 1,562,405 1,566,809 AG & AGRE — — 156 156 70,088 70,244 CON & MAR — — — — 5,213 5,213 $ 40,743 $ 67,791 $ 126,314 $ 234,848 $ 10,779,369 $ 11,014,217 December 31, 2023 30-59 Days 60-89 Days 90+ Days Total Total Past Due Past Due Past Due Past Due Current Loans (In thousands) MTG WHRA $ — $ — $ — $ — $ 752,468 $ 752,468 RES RE 4,557 — 2,379 6,936 1,317,369 1,324,305 MF FIN 38,218 11,055 39,609 88,882 3,917,278 4,006,160 HC FIN — 47,275 35,999 83,274 2,273,415 2,356,689 CML & CRE 172 393 3,665 4,230 1,638,851 1,643,081 AG & AGRE 27 11 147 185 102,965 103,150 CON & MAR 1 3 18 22 13,678 13,700 $ 42,975 $ 58,737 $ 81,817 $ 183,529 $ 10,016,024 $ 10,199,553 |
Schedule of nonaccrual loans and loans past due 90 days or more and still accruing | June 30, December 31, 2024 2023 Total Loans > Total Loans > 90 Days & 90 Days & Nonaccrual Accruing Nonaccrual Accruing (In thousands) RES RE $ 5,244 $ — $ 1,486 $ 894 MF FIN 86,284 — 39,608 — HC FIN 47,809 — 28,783 7,216 CML & CRE 3,835 124 3,820 43 AG & AGRE 147 9 147 — CON & MAR — — 3 15 $ 143,319 $ 133 $ 73,847 $ 8,168 |
Schedule of company's modified loans | For the Three Months Ended June 30, 2024 For the Six Months Ended June 30, 2024 Payment Delay Term Extension Total Class of Financing Receivable % of Total Class of Financing Receivable Payment Delay Term Extension Total Class of Financing Receivable % of Total Class of Financing Receivable (In thousands) MF FIN $ 31,733 $ 126,208 $ 157,941 N/M % $ 31,733 $ 126,208 $ 157,941 N/M % HC FIN — 28,501 28,501 N/M — 28,501 28,501 N/M Total $ 31,733 $ 154,709 $ 186,442 N/M % $ 31,733 $ 154,709 $ 186,442 N/M % For the Three Months Ended June 30, 2024 - Term Extension Loan Type Financial Effect MF FIN Added a weighted average 20 months to the life of loans. HC FIN Added a weighted average 20 months to the life of loans. For the Three Months Ended June 30, 2024 - Payment Delay Loan Type Financial Effect MF FIN Forbearance average of 13 months . For the Six Months Ended June 30, 2024 - Term Extension Loan Type Financial Effect MF FIN Added a weighted average 20 months to the life of loans. HC FIN Added a weighted average 20 months to the life of loans. For the Six Months Ended June 30, 2024 - Payment Delay Loan Type Financial Effect MF FIN Forbearance average of 13 months . The Company closely monitors the performance of loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. The following table presents the performance of such loans that have been modified in the last twelve months as of June 30, 2024: 30 ‑ 89 Days 90+ Days Current Past Due Past Due MF FIN $ 126,208 $ — $ 31,733 HC FIN 28,501 — — Total $ 154,709 $ — $ 31,733 |
Variable Interest Entities (V_2
Variable Interest Entities (VIEs) (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Variable Interest Entities (VIEs) | |
Schedule of assets and liabilities of the VIEs as well as maximum exposure to loss in connection with VIEs | Investments Bridge loans Securities Maximum Liabilities Assets in VIEs to VIEs for VIEs Exposure to Loss for VIEs ($ in thousands) June 30, 2024 Low-income housing tax credit investments $ 107,402 $ 151,890 $ — $ 259,292 $ 28,035 Debt funds 31,180 35,855 — 67,035 2,752 Off-balance-sheet REMIC trusts — 19,790 1,279,174 1,298,964 — Total Unconsolidated VIEs $ 138,582 $ 207,535 $ 1,279,174 $ 1,625,291 $ 30,787 December 31, 2023 Low-income housing tax credit investments $ 118,741 $ 232,407 $ — $ 351,148 $ 35,099 Debt funds 33,221 86,416 — 119,637 2,752 Off-balance-sheet REMIC trusts — — 1,192,201 1,192,201 — Total Unconsolidated VIEs $ 151,962 $ 318,823 $ 1,192,201 $ 1,662,986 $ 37,851 |
Regulatory Matters (Tables)
Regulatory Matters (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Regulatory Matters | |
Summary of bank's actual capital amounts and ratios | Minimum Amount to be Well Minimum Amount Capitalized with To Be Well Actual Basel III Buffer (1) Capitalized (1) Amount Ratio Amount Ratio Amount Ratio (Dollars in thousands) June 30, 2024 Total capital (1) Company $ 1,977,729 12.0 % $ 1,726,065 10.5 % $ — N/A % Merchants Bank 1,971,631 12.0 % 1,725,481 10.5 % 1,643,316 10.0 Tier I capital (1) Company 1,879,605 11.4 % 1,397,291 8.5 % — N/A % Merchants Bank 1,873,508 11.4 % 1,396,818 8.5 % 1,314,653 8.0 Common Equity Tier I capital (1) Company 1,430,219 8.7 % 1,150,710 7.0 % — N/A % Merchants Bank 1,873,508 11.4 % 1,150,321 7.0 % 1,068,155 6.5 Tier I capital (1) Company 1,879,605 10.6 % 890,257 5.0 % — N/A % Merchants Bank 1,873,508 10.5 % 887,924 5.0 % 887,924 5.0 (1) As defined by regulatory agencies. Minimum Amount to be Well Minimum Amount Capitalized with To Be Well Amount Ratio Amount Ratio Amount Ratio (Dollars in thousands) December 31, 2023 Total capital (1) Company $ 1,772,195 11.6 % $ 1,598,260 10.5 % $ — N/A % Merchants Bank 1,724,505 11.5 % 1,577,434 10.5 % 1,502,318 10.0 % FMBI 40,613 21.1 % 20,209 10.5 % 19,247 10.0 % Tier I capital (1) Company 1,686,202 11.1 % 1,293,830 8.5 % — N/A % Merchants Bank 1,639,171 10.9 % 1,276,970 8.5 % 1,201,854 8.0 % FMBI 39,953 20.8 % 16,360 8.5 % 15,398 8.0 % Common Equity Tier I capital (1) Company 1,186,594 7.8 % 1,065,507 7.0 % — N/A % Merchants Bank 1,639,171 10.9 % 1,051,623 7.0 % 976,507 6.5 % FMBI 39,953 20.8 % 13,473 7.0 % 12,511 6.5 % Tier I capital (1) Company 1,686,202 10.1 % 832,706 5.0 % — N/A % Merchants Bank 1,639,171 10.1 % 815,191 5.0 % 815,191 5.0 % FMBI 39,953 11.5 % 17,391 5.0 % 17,391 5.0 % (1) A s defined by regulatory agencies. |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Derivative Financial Instruments | |
Summary of notional amount and fair value of derivative assets and liabilities | Notional Fair Value Amount Balance Sheet Location Asset Liability June 30, 2024 (In thousands) (In thousands) Interest rate lock commitments $ 50,471 Other assets/liabilities $ 170 $ 127 Forward contracts 60,524 Other assets/liabilities 149 88 Interest rate swaps 57,513 Other assets/liabilities 4,232 — Put options 719,731 Other assets 36,957 — Interest rate floors 1,224,171 Other assets 9,124 — Credit derivatives 76,081 Other liabilities — — $ 50,632 $ 215 Notional Fair Value Amount Balance Sheet Location Asset Liability December 31, 2023 (In thousands) (In thousands) Interest rate lock commitments $ 16,526 Other assets/liabilities $ 140 $ 4 Forward contracts 25,500 Other assets/liabilities 4 391 Interest rate swaps 57,540 Other assets/liabilities 2,610 — Put options 748,374 Other assets 25,877 — Interest rate floors 748,374 Other assets 6,576 — $ 35,207 $ 395 |
Summarizes the periodic changes in the fair value of the derivative financial instruments on the consolidated statements of income | Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 (In thousands) (In thousands) Derivative gain (loss) included in gain on sale of loans: Interest rate lock commitments $ (109) $ (188) $ (93) $ 21 Forward contracts (includes pair-off settlements) 285 376 379 280 Interest rates swaps 247 1,597 1,622 261 Net gain $ 423 $ 1,785 $ 1,908 $ 562 Derivative gain included in other income: Put options $ 3,467 $ — $ 11,080 $ — Interest rate floors 214 — 2,548 — Net gain $ 3,681 $ — $ 13,628 $ — |
Interest rate swaps | |
Derivative Financial Instruments | |
Summary of notional amount and fair value of derivative assets and liabilities | Notional Fair Value Amount Balance Sheet Location Asset Liability (In thousands) (In thousands) June 30, 2024 $ 637,876 Other assets/liabilities $ 9,888 $ 9,888 December 31, 2023 $ 607,169 Other assets/liabilities $ 12,426 $ 12,426 |
Summarizes the periodic changes in the fair value of the derivative financial instruments on the consolidated statements of income | Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 (In thousands) (In thousands) Gross swap gains $ 5,371 $ 7,016 $ 2,538 $ 6,436 Gross swap losses 5,371 7,016 2,538 6,436 Net swap gains (losses) $ — $ — $ — $ — |
Disclosures about Fair Value _2
Disclosures about Fair Value of Assets and Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Disclosures about Fair Value of Assets and Liabilities | |
Schedule of fair value measurement of assets measured at fair value on recurring basis | Fair Value Measurements Using Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Fair Assets Inputs Inputs Assets Value (Level 1) (Level 2) (Level 3) (In thousands) June 30, 2024 Mortgage loans in process of securitization $ 209,244 $ — $ 209,244 $ — Securities available for sale: Treasury notes 109,079 109,079 — — Federal agencies 219,318 — 219,318 — Mortgage-backed - Agency 5,848 — 5,848 — Mortgage-backed - Non-agency residential - fair value option 462,627 — — 462,627 Mortgage-backed - Agency - fair value option 220,147 — 220,147 — Loans held for sale 102,873 — 102,873 — Servicing rights 178,776 — — 178,776 Derivative assets: Interest rate lock commitments 170 — — 170 Forward contracts 149 — 149 — Interest rate swaps 4,232 — 4,232 — Interest rate swaps, caps and floors (back-to-back) 9,888 — 9,888 — Put options 36,957 — 12,300 24,657 Interest rate floors 9,124 — — 9,124 Derivative liabilities: Interest rate lock commitments 127 — — 127 Forward contracts 88 — 88 — Interest rate swaps, caps and floors (back-to-back) 9,888 — 9,888 — December 31, 2023 Mortgage loans in process of securitization $ 110,599 $ — $ 110,599 $ — Securities available for sale: Treasury notes 128,968 128,968 — — Federal agencies 247,755 — 247,755 — Mortgage-backed - Agency 14,467 — 14,467 — Mortgage-backed - Non-agency residential - fair value option 485,500 — — 485,500 Mortgage-backed - Agency - fair value option 236,997 — 236,997 — Loans held for sale 86,663 — 86,663 — Servicing rights 158,457 — — 158,457 Derivative assets: Interest rate lock commitments 140 — — 140 Forward contracts 4 — 4 — Interest rate swaps 2,610 — 2,610 — Interest rate swaps, caps and floors (back-to-back) 12,426 — 12,426 — Put options 25,877 — 7,223 18,654 Interest rate floors 6,576 — — 6,576 Derivative liabilities: Interest rate lock commitments 4 — — 4 Forward contracts 391 — 391 — Interest rate swaps, caps and floors (back-to-back) 12,426 — 12,426 — |
Schedule of Level 3 reconciliation of recurring fair value measurements | Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 (In thousands) (In thousands) Servicing rights Balance, beginning of period $ 172,200 $ 143,867 $ 158,457 $ 146,248 Additions Originated servicing 3,761 2,124 5,927 4,297 Subtractions Paydowns (2,252) (2,073) (4,639) (3,771) Changes in fair value 5,067 3,370 19,031 514 Balance, end of period $ 178,776 $ 147,288 $ 178,776 $ 147,288 Securities available for sale - Mortgage-backed - Non-Agency residential - fair value option Balance, beginning of period $ 472,192 $ — $ 485,500 $ — Paydowns (7,884) — (16,870) — Changes in fair value (1,681) — (6,003) — Balance, end of period $ 462,627 $ — $ 462,627 $ — Derivative assets - put options Balance, beginning of period $ 22,976 $ — $ 18,654 $ — Changes in fair value 1,681 — 6,003 — Balance, end of period $ 24,657 $ — $ 24,657 $ — Derivative assets - interest rate floors Balance, beginning of period $ 8,910 $ — $ 6,576 $ — Changes in fair value 214 — 2,548 — Balance, end of period $ 9,124 $ — $ 9,124 $ — Derivative assets - interest rate lock commitments Balance, beginning of period $ 174 $ 218 $ 140 $ 28 Changes in fair value (4) (124) 30 66 Balance, end of period $ 170 $ 94 $ 170 $ 94 Derivative liabilities - interest rate lock commitments Balance, beginning of period $ 22 $ 4 $ 4 $ 23 Changes in fair value 105 64 123 45 Balance, end of period $ 127 $ 68 $ 127 $ 68 |
Schedule of fair value measurement of assets and liabilities measured at fair value on nonrecurring basis | Fair Value Measurements Using Quoted Prices in Significant Significant Active Markets for Other Observable Unobservable Fair Identical Assets Inputs Inputs Assets Value (Level 1) (Level 2) (Level 3) (In thousands) June 30, 2024 Collateral dependent loans $ 29,732 $ — $ — $ 29,732 December 31, 2023 Collateral dependent loans $ 47,026 $ — $ — $ 47,026 |
Schedule of quantitative information about unobservable inputs used in recurring and nonrecurring Level 3 fair value measurements other than goodwill | Valuation Weighted Fair Value Technique Unobservable Inputs Range Average (In thousands) At June 30, 2024: Securities available for sale - Mortgage-backed - Non-Agency residential - fair value option $ 462,627 Discounted cash flow Market credit spread 3% 3% Collateral dependent loans $ 29,732 Market comparable properties Marketability discount 0% - 56% 4% Servicing rights - Multi-family $ 141,160 Discounted cash flow Discount rate 8% - 13% 9% Constant prepayment rate 0% - 62% 7% Servicing rights - Single-family $ 32,654 Discounted cash flow Discount rate 10% - 11% 10% Constant prepayment rate 6% - 15% 7% Servicing rights - SBA $ 4,962 Discounted cash flow Discount rate 16% 16% Constant prepayment rate 3% - 14% 9% Derivative assets: Interest rate lock commitments $ 170 Discounted cash flow Loan closing rates 57% - 99% 83% Put options $ 24,657 Intrinsic option value Market credit spread 3% 3% Interest rate floors $ 9,124 Discounted cash flow Discount rate 6%-9% 7% Derivative liabilities - interest rate lock commitments $ 127 Discounted cash flow Loan closing rates 57% - 99% 83% At December 31, 2023: Securities available for sale - Mortgage-backed - Non-Agency residential - fair value option $ 485,500 Discounted cash flow Market credit spread 2% 2% Collateral dependent loans $ 47,026 Market comparable properties Marketability discount 0% - 100% 2% Servicing rights - Multi-family $ 122,218 Discounted cash flow Discount rate 8% - 13% 9% Constant prepayment rate 0% - 50% 7% Servicing rights - Single-family $ 30,959 Discounted cash flow Discount rate 10% - 11% 10% Constant prepayment rate 6% - 16% 7% Servicing rights - SBA $ 5,280 Discounted cash flow Discount rate 16% 16% Constant prepayment rate 3% - 14% 9% Derivative assets: Interest rate lock commitments $ 140 Discounted cash flow Loan closing rates 45% - 99% 78% Put options $ 18,654 Intrinsic option value Market credit spread 2% 2% Interest rate floors $ 6,576 Discounted cash flow Discount rate 6%-7% 7% Derivative liabilities - interest rate lock commitments $ 4 Discounted cash flow Loan closing rates 45% - 99% 78% |
Schedule of carrying amount and estimated fair value of financial instruments | Fair Value Measurements Using Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Carrying Fair Assets Inputs Inputs Assets Value Value (Level 1) (Level 2) (Level 3) (In thousands) June 30, 2024 Financial assets: Cash and cash equivalents $ 540,882 $ 540,882 $ 540,882 $ — $ — Securities purchased under agreements to resell 3,304 3,304 — 3,304 — Securities held to maturity 1,291,110 1,291,960 — 603,235 688,725 FHLB stock 67,499 67,499 — 67,499 — Loans held for sale 3,380,203 3,380,203 — 3,380,203 — Loans receivable, net 10,933,189 10,888,928 — — 10,888,928 Interest receivable 90,360 90,360 — 90,360 — Financial liabilities: Deposits 14,917,067 14,918,490 8,051,468 6,867,022 — Short-term subordinated debt 68,514 68,514 — 68,514 — FHLB advances 974,008 973,919 — 973,919 — Other borrowing 7,934 7,934 — 7,934 — Credit linked notes 108,750 108,748 — 108,748 — Interest payable 59,226 59,226 — 59,226 — December 31, 2023 Financial assets: Cash and cash equivalents $ 584,422 $ 584,422 $ 584,422 $ — $ — Securities purchased under agreements to resell 3,349 3,349 — 3,349 — Securities held to maturity 1,204,217 1,203,535 — 484,288 719,247 FHLB stock 48,578 48,578 — 48,578 — Loans held for sale 3,058,093 3,058,093 — 3,058,093 — Loans receivable, net 10,127,801 10,088,468 — — 10,088,468 Interest receivable 91,346 91,346 — 91,346 — Financial liabilities: Deposits 14,061,460 14,062,457 8,894,058 5,168,399 — Short-term subordinated debt 64,922 64,922 — 64,922 — FHLB advances 771,392 771,029 — 771,029 — Other borrowing 7,934 7,934 — 7,934 — Credit linked notes 119,879 119,878 — 119,878 — Interest payable 43,423 43,423 — 43,423 — |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Leases. | |
Schedule of balance sheet, income statement and cash flow detail regarding operating leases | June 30, 2024 December 31, 2023 Balance Sheet (In thousands) (In thousands) Operating lease right-of-of use asset (in other assets) $ 7,992 $ 10,060 Operating lease liability (in other liabilities) 9,098 11,251 Weighted average remaining lease term (years) 4.7 6.0 Weighted average discount rate 3.25% 2.89% Maturities of lease liabilities: One year or less $ 2,286 $ 2,441 Year two 2,101 2,064 Year three 2,019 2,100 Year four 1,731 2,046 Year five 1,051 1,438 Thereafter 623 2,128 Total future minimum lease payments 9,811 12,217 Less: imputed interest 713 966 Total $ 9,098 $ 11,251 Three Months Ended Three Months Ended June 30, 2024 June 30, 2023 Income Statement (In thousands) (In thousands) Components of lease expense: Operating lease cost (in occupancy and equipment expense) $ 765 $ 666 Six Months Ended Six Months Ended June 30, 2024 June 30, 2023 Income Statement (In thousands) (In thousands) Components of lease expense: Operating lease cost (in occupancy and equipment expense) $ 1,369 $ 1,249 Six Months Ended Six Months Ended June 30, 2024 June 30, 2023 Cash Flow Statement (In thousands) (In thousands) Supplemental cash flow information: Operating cash flows from operating leases $ 1,220 $ 886 |
Deposits (Tables)
Deposits (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Deposits. | |
Schedule of deposits | June 30, December 31, 2024 2023 (In thousands) Noninterest-bearing deposits Demand deposits $ 383,260 $ 520,070 Total noninterest-bearing deposits 383,260 520,070 Interest-bearing deposits Demand deposits $ 4,779,531 $ 5,381,067 Savings deposits 2,888,677 2,992,921 Certificates of deposit 6,865,599 5,167,402 Total interest-bearing deposits 14,533,807 13,541,390 Total deposits $ 14,917,067 $ 14,061,460 |
Schedule of maturities for certificates of deposit | June 30, 2024 (In thousands) Due within one year $ 6,760,482 Due in one year to two years 91,157 Due in two years to three years 13,960 Due in three years to four years — Due in four years to five years — Due in five years to six years — $ 6,865,599 |
Schedule of brokered deposit amounts | June 30, December 31, 2024 2023 (In thousands) Brokered certificates of deposit $ 6,119,391 $ 4,465,825 Brokered savings deposits 948 589 Brokered deposit on demand accounts — 1,504,230 $ 6,120,339 $ 5,970,644 |
Borrowings (Tables)
Borrowings (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Borrowings | |
Schedule of borrowings | June 30, December 31, 2024 2023 (In thousands) Short-term subordinated debt $ 68,514 $ 64,922 FHLB advances 974,008 771,392 Credit linked notes, net of debt discount 108,750 119,879 Other borrowings 7,934 7,934 Total borrowings $ 1,159,206 $ 964,127 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Earnings Per Share | |
Schedule of computation of earnings per share | Three Month Periods Ended June 30, 2024 2023 Weighted- Per Weighted- Per Net Average Share Net Average Share Income Shares Amount Income Shares Amount (In thousands, except share data) Net income $ 76,393 $ 65,302 Dividends on preferred stock (7,757) (8,668) Preferred stock redemption (1,823) — Net income available to common shareholders $ 66,813 $ 56,634 Basic earnings per share 44,569,345 $ 1.50 43,235,398 $ 1.31 Effect of dilutive securities-restricted stock awards 128,979 73,995 Diluted earnings per share 44,698,324 $ 1.49 43,309,393 $ 1.31 Six Month Periods Ended June 30, 2024 2023 Weighted- Per Weighted- Per Net Average Share Net Average Share Income Shares Amount Income Shares Amount (In thousands, except share data) Net income $ 163,447 $ 120,257 Dividends on preferred stock (16,424) (17,335) Preferred stock redemption (1,823) — Net income available to common shareholders $ 145,200 $ 102,922 Basic earnings per share 43,937,665 $ 3.30 43,207,655 $ 2.38 Effect of dilutive securities-restricted stock awards 144,820 92,585 Diluted earnings per share 44,082,485 $ 3.29 43,300,240 $ 2.38 |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Segment Information | |
Schedule of business segment financial information | Multi-family Mortgage Mortgage Banking Warehousing Banking Other Total Three Months Ended June 30, 2024 (In thousands) Interest income $ 1,135 $ 101,164 $ 222,785 $ 3,189 $ 328,273 Interest expense 20 68,184 132,742 (792) 200,154 Net interest income 1,115 32,980 90,043 3,981 128,119 Provision for credit losses — 995 8,970 — 9,965 Net interest income after provision for credit losses 1,115 31,985 81,073 3,981 118,154 Noninterest income 31,983 1,746 1,194 (3,572) 31,351 Noninterest expense 20,651 4,674 14,985 10,070 50,380 Income (loss) before income taxes 12,447 29,057 67,282 (9,661) 99,125 Income taxes 3,410 6,787 14,904 (2,369) 22,732 Net income (loss) $ 9,037 $ 22,270 $ 52,378 $ (7,292) $ 76,393 Total assets $ 428,299 $ 5,626,055 $ 11,885,484 $ 272,584 $ 18,212,422 Multi-family Mortgage Mortgage Banking Warehousing Banking Other Total Three Months Ended June 30, 2023 (In thousands) Interest income $ 1,248 $ 64,267 $ 191,406 $ 1,148 $ 258,069 Interest expense 13 42,984 111,311 (1,856) 152,452 Net interest income 1,235 21,283 80,095 3,004 105,617 Provision for credit losses — 2,320 20,283 — 22,603 Net interest income after provision for credit losses 1,235 18,963 59,812 3,004 83,014 Noninterest income 30,325 2,872 (760) (2,555) 29,882 Noninterest expense 19,962 3,617 12,118 8,623 44,320 Income (loss) before income taxes 11,598 18,218 46,934 (8,174) 68,576 Income taxes 356 (378) 4,284 (988) 3,274 Net income (loss) $ 11,242 $ 18,596 $ 42,650 $ (7,186) $ 65,302 Total assets $ 373,680 $ 4,474,832 $ 10,784,596 $ 241,764 $ 15,874,872 Multi-family Mortgage Mortgage Banking Warehousing Banking Other Total (In thousands) Six Months Ended June 30, 2024 Interest income $ 2,881 $ 186,065 447,073 $ 6,427 $ 642,446 Interest expense 40 124,324 264,465 (1,558) 387,271 Net interest income 2,841 61,741 182,608 7,985 255,175 Provision for credit losses — 1,935 12,756 — 14,691 Net interest income after provision for credit losses 2,841 59,806 169,852 7,985 240,484 Noninterest income 72,450 5,063 1,623 (6,911) 72,225 Noninterest expense 40,222 9,472 30,563 19,035 99,292 Income (loss) before income taxes 35,069 55,397 140,912 (17,961) 213,417 Income taxes 9,423 12,937 32,109 (4,499) 49,970 Net income (loss) $ 25,646 $ 42,460 $ 108,803 $ (13,462) $ 163,447 Total assets $ 428,299 $ 5,626,055 $ 11,885,484 $ 272,584 $ 18,212,422 Multi-family Mortgage Mortgage Banking Warehousing Banking Other Total (In thousands) Six Months Ended June 30, 2023 Interest income $ 2,354 $ 106,585 $ 358,132 $ 2,292 $ 469,363 Interest expense 13 70,778 195,837 (3,575) 263,053 Net interest income 2,341 35,807 162,295 5,867 206,310 Provision for credit losses — 3,684 25,786 — 29,470 Net interest income after provision for credit losses 2,341 32,123 136,509 5,867 176,840 Noninterest income 46,922 3,905 (1,949) (4,732) 44,146 Noninterest expense 34,593 6,372 22,288 15,839 79,092 Income (loss) before income taxes 14,670 29,656 112,272 (14,704) 141,894 Income taxes 1,462 2,419 20,315 (2,559) 21,637 Net income (loss) $ 13,208 $ 27,237 $ 91,957 $ (12,145) $ 120,257 Total assets $ 373,680 $ 4,474,832 $ 10,784,596 $ 241,764 $ 15,874,872 |
Basis of Presentation (Details)
Basis of Presentation (Details) - USD ($) | 3 Months Ended | ||
Jan. 26, 2024 | Mar. 31, 2024 | Jun. 30, 2024 | |
Restricted cash | $ 37,000,000 | ||
Credit linked notes, net of debt discount | |||
Notes issued | $ 112,300,000 | ||
Farmers Merchants Bank Of Illinois Branches | Disposed by sale | |||
Assets | $ 60,800,000 | ||
Liabilities | 230,600,000 | ||
Net Gain | $ 715,000 | ||
Extinguishment Of Goodwill | 7,800,000 | ||
Extinguishment Of Intangibles | 500,000 | ||
Farmers-Merchants Bank of Illinois branch locations in Paxton, Melvin, and Piper City, Illinois | Bank of Pontiac | |||
Deposit premium | $ 10,100,000 | ||
Farmers-Merchants Bank of Illinois branch locations in Paxton, Melvin, and Piper City, Illinois | Disposed by sale | Bank of Pontiac | |||
Deposits | 164,800,000 | ||
Loans | 19,200,000 | ||
Farmers-Merchants Bank of Illinois branch located in Joy, Illinois | Disposed by sale | CBI Bank & Trust | |||
Deposits | 65,100,000 | ||
Loans | $ 28,600,000 |
Investment Securities - Amortiz
Investment Securities - Amortized Cost to Approximate Fair Value (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 | |
Available for sale securities: | |||
Amortized Cost | $ 1,017,689 | $ 1,116,954 | |
Gross Unrealized Gains | 13 | 50 | |
Gross Unrealized Losses | 683 | 3,317 | |
Fair Value | 1,017,019 | 1,113,687 | [1] |
Accrued interest on securities available for sale | 5,900 | 6,700 | |
Held to maturity securities: | |||
Amortized Cost | 1,291,110 | 1,204,217 | [1] |
Gross Unrealized Gains | 2,397 | 973 | |
Gross Unrealized Losses | 1,547 | 1,655 | |
Fair Value | 1,291,960 | 1,203,535 | |
Accrued interest on securities held to maturity | 6,200 | 5,800 | |
Treasury notes | |||
Available for sale securities: | |||
Amortized Cost | 109,067 | 129,261 | |
Gross Unrealized Gains | 12 | 45 | |
Gross Unrealized Losses | 338 | ||
Fair Value | 109,079 | 128,968 | |
Federal agencies | |||
Available for sale securities: | |||
Amortized Cost | 220,000 | 250,731 | |
Gross Unrealized Gains | 1 | ||
Gross Unrealized Losses | 683 | 2,976 | |
Fair Value | 219,318 | 247,755 | |
Mortgage-backed - Government Agency ("Agency") | |||
Available for sale securities: | |||
Amortized Cost | 5,848 | 14,465 | |
Gross Unrealized Gains | 5 | ||
Gross Unrealized Losses | 3 | ||
Fair Value | 5,848 | 14,467 | |
Mortgage-backed - Non-Agency residential | |||
Available for sale securities: | |||
Amortized Cost | 462,627 | 485,500 | |
Fair Value | 462,627 | 485,500 | |
Held to maturity securities: | |||
Amortized Cost | 589,925 | 472,539 | |
Gross Unrealized Gains | 2,397 | 973 | |
Gross Unrealized Losses | 81 | 418 | |
Fair Value | 592,241 | 473,094 | |
Mortgage-backed - Agency - fair value option | |||
Available for sale securities: | |||
Amortized Cost | 220,147 | 236,997 | |
Fair Value | 220,147 | 236,997 | |
Mortgage-backed - Non-Agency multi-family | |||
Held to maturity securities: | |||
Amortized Cost | 689,249 | 719,662 | |
Gross Unrealized Losses | 524 | 415 | |
Fair Value | 688,725 | 719,247 | |
Mortgage-backed - Agency | |||
Held to maturity securities: | |||
Amortized Cost | 11,936 | 12,016 | |
Gross Unrealized Losses | 942 | 822 | |
Fair Value | $ 10,994 | $ 11,194 | |
[1] *Derived from audited consolidated financial statements |
Investment Securities - Contrac
Investment Securities - Contractual Maturities (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 | |
Available for Sale Securities, Amortized Cost | |||
Within one year | $ 189,067 | $ 308,474 | |
After one through five years | 140,000 | 71,518 | |
Total, single maturity date | 329,067 | 379,992 | |
Total | 1,017,689 | 1,116,954 | |
Available for Sale Securities, Fair Value | |||
Within one year | 188,522 | 305,406 | |
After one through five years | 139,875 | 71,317 | |
Total, single maturity date | 328,397 | 376,723 | |
Total | 1,017,019 | 1,113,687 | [1] |
Held to Maturity Securities, Amortized Cost | |||
Amortized Cost | 1,291,110 | 1,204,217 | [1] |
Held to Maturity Securities, Fair Value | |||
Fair Value | 1,291,960 | 1,203,535 | |
Mortgage-backed - Agency | |||
Available for Sale Securities, Amortized Cost | |||
Without single maturity date | 5,848 | 14,465 | |
Available for Sale Securities, Fair Value | |||
Without single maturity date | 5,848 | 14,467 | |
Held to Maturity Securities, Amortized Cost | |||
Amortized Cost | 11,936 | 12,016 | |
Held to Maturity Securities, Fair Value | |||
Fair Value | 10,994 | 11,194 | |
Mortgage-backed - Government Agency ("Agency") | |||
Available for Sale Securities, Amortized Cost | |||
Total | 5,848 | 14,465 | |
Available for Sale Securities, Fair Value | |||
Total | 5,848 | 14,467 | |
Mortgage-backed - Agency - fair value option | |||
Available for Sale Securities, Amortized Cost | |||
Without single maturity date | 220,147 | 236,997 | |
Total | 220,147 | 236,997 | |
Available for Sale Securities, Fair Value | |||
Without single maturity date | 220,147 | 236,997 | |
Total | 220,147 | 236,997 | |
Mortgage-backed - Non-Agency multi-family | |||
Held to Maturity Securities, Amortized Cost | |||
Amortized Cost | 689,249 | 719,662 | |
Held to Maturity Securities, Fair Value | |||
Fair Value | 688,725 | 719,247 | |
Mortgage-backed - Non-Agency residential | |||
Available for Sale Securities, Amortized Cost | |||
Without single maturity date | 462,627 | 485,500 | |
Total | 462,627 | 485,500 | |
Available for Sale Securities, Fair Value | |||
Without single maturity date | 462,627 | 485,500 | |
Total | 462,627 | 485,500 | |
Held to Maturity Securities, Amortized Cost | |||
Amortized Cost | 589,925 | 472,539 | |
Held to Maturity Securities, Fair Value | |||
Fair Value | $ 592,241 | $ 473,094 | |
[1] *Derived from audited consolidated financial statements |
Investment Securities - Sale of
Investment Securities - Sale of securities (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Investment Securities | ||||
Proceeds from the sale of securities available for sale | $ 0 | $ 132,000 | $ 9,983,000 | $ 132,000 |
Net loss on sale of securities available for sale | 108,000 | |||
Losses on sale of securities available for sale | 10,000 | |||
Gain on sale of securities available for sale | $ 118,000 |
Investment Securities - Continu
Investment Securities - Continuous Unrealized Loss Position (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value | ||
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value, Less than 12 Months | $ 114,874 | $ 63,957 |
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value, 12 Months or Longer | 79,443 | 199,479 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value, Total | 194,317 | 263,436 |
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses | ||
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, Less than 12 Months | 126 | 196 |
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, 12 Months or Longer | 557 | 3,121 |
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, Total | 683 | 3,317 |
Treasury notes | ||
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value | ||
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value, Less than 12 Months | 3,052 | |
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value, 12 Months or Longer | 32,080 | |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value, Total | 35,132 | |
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses | ||
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, Less than 12 Months | 6 | |
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, 12 Months or Longer | 332 | |
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, Total | 338 | |
Federal agencies | ||
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value | ||
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value, Less than 12 Months | 114,874 | 60,541 |
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value, 12 Months or Longer | 79,443 | 167,213 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value, Total | 194,317 | 227,754 |
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses | ||
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, Less than 12 Months | 126 | 189 |
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, 12 Months or Longer | 557 | 2,787 |
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, Total | $ 683 | 2,976 |
Mortgage-backed - Agency | ||
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value | ||
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value, Less than 12 Months | 364 | |
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value, 12 Months or Longer | 186 | |
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value, Total | 550 | |
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses | ||
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, Less than 12 Months | 1 | |
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, 12 Months or Longer | 2 | |
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, Total | $ 3 |
Investment Securities - Allowan
Investment Securities - Allowance for Credit Losses (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Investment Securities | ||
Securities available for sale, allowance for credit losses | $ 0 | $ 0 |
Securities held to maturity, allowance for credit losses | $ 0 | $ 0 |
Mortgage Loans in Process of _2
Mortgage Loans in Process of Securitization (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2024 | Dec. 31, 2023 | |
Mortgage Loans in Process of Securitization | ||
Unrealized gains included in mortgage loans | $ 0.5 | $ 0.8 |
Loans and Allowance for Credi_3
Loans and Allowance for Credit Losses on Loans - Summary of Loans By Classification (Details) $ in Thousands | 6 Months Ended | ||||||
Jun. 30, 2024 USD ($) | Mar. 31, 2024 USD ($) | Dec. 31, 2023 USD ($) | Jun. 30, 2023 USD ($) | Mar. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | ||
Loans and Allowance for Credit Losses on Loans | |||||||
Accrued interest on loans, excluded from amortized cost of loans | $ 58,600 | $ 60,400 | |||||
Loans | 11,014,217 | 10,199,553 | |||||
ACL-Loans | 81,028 | $ 75,712 | 71,752 | $ 62,986 | $ 51,838 | $ 44,014 | |
Loans receivable | 10,933,189 | 10,127,801 | [1] | ||||
Mortgage warehouse repurchase agreements | |||||||
Loans and Allowance for Credit Losses on Loans | |||||||
Loans | 1,369,965 | 752,468 | |||||
ACL-Loans | 3,616 | 3,022 | 2,070 | 3,361 | 1,664 | 1,249 | |
Residential real estate | |||||||
Loans and Allowance for Credit Losses on Loans | |||||||
Loans | 1,345,656 | 1,324,305 | |||||
ACL-Loans | 6,323 | 6,905 | 7,323 | 7,413 | 7,378 | 7,029 | |
Residential real estate | Home equity line of credit | |||||||
Loans and Allowance for Credit Losses on Loans | |||||||
Loans | 1,200,000 | 1,200,000 | |||||
Multi-family financing | |||||||
Loans and Allowance for Credit Losses on Loans | |||||||
Loans | 4,160,420 | 4,006,160 | |||||
ACL-Loans | 34,412 | 28,664 | 26,874 | 24,701 | 19,851 | 16,781 | |
Healthcare financing | |||||||
Loans and Allowance for Credit Losses on Loans | |||||||
Loans | 2,495,910 | 2,356,689 | |||||
ACL-Loans | 23,522 | 24,587 | 22,454 | 16,123 | 11,753 | 9,882 | |
Commercial and commercial real estate | |||||||
Loans and Allowance for Credit Losses on Loans | |||||||
Loans | 1,566,809 | 1,643,081 | |||||
ACL-Loans | 12,591 | 11,990 | 12,243 | 10,695 | 10,482 | 8,326 | |
Revolving lines of credit collateralized primarily by mortgage servicing rights | 1,000,000 | 1,100,000 | |||||
Commercial and commercial real estate | Non - Owner occupied commercial real estate | |||||||
Loans and Allowance for Credit Losses on Loans | |||||||
Loans | $ 6,800 | 8,400 | |||||
Commercial and commercial real estate | Non - Owner occupied commercial real estate | Minimum | |||||||
Loans and Allowance for Credit Losses on Loans | |||||||
Percentage of loans to be forgiven | 1 | ||||||
Agricultural production and real estate | |||||||
Loans and Allowance for Credit Losses on Loans | |||||||
Loans | $ 70,244 | 103,150 | |||||
ACL-Loans | 489 | 450 | 619 | 556 | 543 | 565 | |
Consumer and margin loans | |||||||
Loans and Allowance for Credit Losses on Loans | |||||||
Loans | 5,213 | 13,700 | |||||
ACL-Loans | $ 75 | $ 94 | $ 169 | $ 137 | $ 167 | $ 182 | |
[1] *Derived from audited consolidated financial statements |
Loans and Allowance for Credi_4
Loans and Allowance for Credit Losses on Loans - Allowance For Credit-Loan Losses (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | |
Allowance for credit losses | |||||
Balance, beginning of period | $ 75,712 | $ 51,838 | $ 71,752 | $ 44,014 | $ 44,014 |
FMBI's ACL for loans sold | (593) | ||||
Provision for credit losses | 8,753 | 20,678 | 14,230 | 28,495 | 37,488 |
Loans charged to the allowance | (3,452) | (9,532) | (4,377) | (9,532) | (9,791) |
Recoveries of loans previously charged-off | 15 | 2 | 16 | 9 | 41 |
Balance, end of period | 81,028 | 62,986 | 81,028 | 62,986 | 71,752 |
ACL Loans | |||||
Provision for credit losses | 9,965 | 22,603 | 14,691 | 29,470 | |
Provision for credit losses, ACL Loans | 8,800 | 20,700 | 13,600 | 28,500 | |
Provision for credit losses, ACL-OBCE's | 1,200 | 1,900 | 1,100 | 1,000 | |
Mortgage warehouse repurchase agreements | |||||
Allowance for credit losses | |||||
Balance, beginning of period | 3,022 | 1,664 | 2,070 | 1,249 | 1,249 |
Provision for credit losses | 594 | 1,697 | 1,546 | 2,112 | 821 |
Balance, end of period | 3,616 | 3,361 | 3,616 | 3,361 | 2,070 |
Residential real estate | |||||
Allowance for credit losses | |||||
Balance, beginning of period | 6,905 | 7,378 | 7,323 | 7,029 | 7,029 |
FMBI's ACL for loans sold | (55) | ||||
Provision for credit losses | (595) | 48 | (958) | 397 | 328 |
Loans charged to the allowance | (13) | (13) | (34) | ||
Recoveries of loans previously charged-off | 13 | 13 | |||
Balance, end of period | 6,323 | 7,413 | 6,323 | 7,413 | 7,323 |
Multi-family financing | |||||
Allowance for credit losses | |||||
Balance, beginning of period | 28,664 | 19,851 | 26,874 | 16,781 | 16,781 |
FMBI's ACL for loans sold | (186) | ||||
Provision for credit losses | 9,097 | 13,250 | 11,073 | 16,320 | 18,493 |
Loans charged to the allowance | (3,349) | (8,400) | (3,349) | (8,400) | (8,400) |
Balance, end of period | 34,412 | 24,701 | 34,412 | 24,701 | 26,874 |
Healthcare financing | |||||
Allowance for credit losses | |||||
Balance, beginning of period | 24,587 | 11,753 | 22,454 | 9,882 | 9,882 |
FMBI's ACL for loans sold | (2) | ||||
Provision for credit losses | (1,065) | 4,370 | 1,070 | 6,241 | 12,572 |
Balance, end of period | 23,522 | 16,123 | 23,522 | 16,123 | 22,454 |
Commercial and commercial real estate | |||||
Allowance for credit losses | |||||
Balance, beginning of period | 11,990 | 10,482 | 12,243 | 8,326 | 8,326 |
FMBI's ACL for loans sold | (92) | ||||
Provision for credit losses | 702 | 1,329 | 1,465 | 3,478 | 5,232 |
Loans charged to the allowance | (103) | (1,118) | (1,028) | (1,118) | (1,356) |
Recoveries of loans previously charged-off | 2 | 2 | 3 | 9 | 41 |
Balance, end of period | 12,591 | 10,695 | 12,591 | 10,695 | 12,243 |
Agricultural production and real estate | |||||
Allowance for credit losses | |||||
Balance, beginning of period | 450 | 543 | 619 | 565 | 565 |
FMBI's ACL for loans sold | (246) | ||||
Provision for credit losses | 39 | 13 | 116 | (9) | 54 |
Balance, end of period | 489 | 556 | 489 | 556 | 619 |
Consumer and margin loans | |||||
Allowance for credit losses | |||||
Balance, beginning of period | 94 | 167 | 169 | 182 | 182 |
FMBI's ACL for loans sold | (12) | ||||
Provision for credit losses | (19) | (29) | (82) | (44) | (12) |
Loans charged to the allowance | (1) | (1) | (1) | ||
Balance, end of period | $ 75 | $ 137 | $ 75 | $ 137 | $ 169 |
Loans and Allowance for Credi_5
Loans and Allowance for Credit Losses on Loans - Amortized cost basis and ACL (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Mar. 31, 2024 | Dec. 31, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 |
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | $ 11,014,217 | $ 10,199,553 | ||||
ACL-Loans | 81,028 | $ 75,712 | 71,752 | $ 62,986 | $ 51,838 | $ 44,014 |
Real Estate | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 241,148 | 122,334 | ||||
Accounts Receivable or Equipment | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 2,422 | 3,603 | ||||
Other | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 3,269 | 2,690 | ||||
Collateral pledged | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 246,839 | 128,627 | ||||
ACL-Loans | 12,561 | 7,964 | ||||
Residential real estate | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 1,345,656 | 1,324,305 | ||||
ACL-Loans | 6,323 | 6,905 | 7,323 | 7,413 | 7,378 | 7,029 |
Residential real estate | Real Estate | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 5,752 | 1,557 | ||||
Residential real estate | Other | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 3 | |||||
Residential real estate | Collateral pledged | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 5,752 | 1,560 | ||||
ACL-Loans | 31 | 21 | ||||
Multi-family financing | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 4,160,420 | 4,006,160 | ||||
ACL-Loans | 34,412 | 28,664 | 26,874 | 24,701 | 19,851 | 16,781 |
Multi-family financing | Real Estate | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 160,497 | 46,575 | ||||
Multi-family financing | Other | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 693 | |||||
Multi-family financing | Collateral pledged | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 161,190 | 46,575 | ||||
ACL-Loans | 4,752 | 521 | ||||
Healthcare financing | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 2,495,910 | 2,356,689 | ||||
ACL-Loans | 23,522 | 24,587 | 22,454 | 16,123 | 11,753 | 9,882 |
Healthcare financing | Real Estate | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 73,409 | 73,909 | ||||
Healthcare financing | Collateral pledged | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 73,409 | 73,909 | ||||
ACL-Loans | 5,798 | 6,289 | ||||
Commercial and commercial real estate | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 1,566,809 | 1,643,081 | ||||
ACL-Loans | 12,591 | 11,990 | 12,243 | 10,695 | 10,482 | 8,326 |
Commercial and commercial real estate | Real Estate | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 1,343 | 146 | ||||
Commercial and commercial real estate | Accounts Receivable or Equipment | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 2,422 | 3,603 | ||||
Commercial and commercial real estate | Other | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 2,576 | 2,684 | ||||
Commercial and commercial real estate | Collateral pledged | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 6,341 | 6,433 | ||||
ACL-Loans | 1,979 | 1,132 | ||||
Agricultural production and real estate | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 70,244 | 103,150 | ||||
ACL-Loans | 489 | 450 | 619 | 556 | 543 | 565 |
Agricultural production and real estate | Real Estate | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 147 | 147 | ||||
Agricultural production and real estate | Collateral pledged | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 147 | 147 | ||||
ACL-Loans | 1 | 1 | ||||
Consumer and margin loans | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 5,213 | 13,700 | ||||
ACL-Loans | $ 75 | $ 94 | 169 | $ 137 | $ 167 | $ 182 |
Consumer and margin loans | Other | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | 3 | |||||
Consumer and margin loans | Collateral pledged | ||||||
Loans and Allowance for Credit Losses on Loans | ||||||
Amortized Cost Basis | $ 3 |
Loans and Allowance for Credi_6
Loans and Allowance for Credit Losses on Loans - Credit Risk Profile of Loan Portfolio (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | |
Credit risk profile of portfolio | |||||
2024/2023 | $ 1,051,865 | $ 1,051,865 | $ 2,115,132 | ||
2023/2022 | 1,547,573 | 1,547,573 | 1,954,111 | ||
2022/2021 | 1,809,588 | 1,809,588 | 454,876 | ||
2021/2020 | 301,994 | 301,994 | 136,666 | ||
2020/2019 | 55,609 | 55,609 | 74,113 | ||
Prior | 100,594 | 100,594 | 58,347 | ||
Revolving Loans | 6,146,994 | 6,146,994 | 5,406,308 | ||
Loans | 11,014,217 | 11,014,217 | 10,199,553 | ||
Net Charge-Offs | |||||
Charge-offs 2023/2022 | 870 | 8,896 | |||
Charge-offs 2022/2021 | 2,582 | 274 | |||
Charge-offs 2021/2020 | 925 | 586 | |||
Charge-offs Prior | 22 | ||||
Charge-offs Revolving Loans | 13 | ||||
Net Charge-Offs | 3,452 | $ 9,532 | 4,377 | $ 9,532 | 9,791 |
Pass | |||||
Credit risk profile of portfolio | |||||
2024/2023 | 998,270 | 998,270 | 1,947,008 | ||
2023/2022 | 1,345,550 | 1,345,550 | 1,902,347 | ||
2022/2021 | 1,684,098 | 1,684,098 | 409,166 | ||
2021/2020 | 261,836 | 261,836 | 135,601 | ||
2020/2019 | 54,787 | 54,787 | 73,977 | ||
Prior | 98,653 | 98,653 | 55,806 | ||
Revolving Loans | 6,080,184 | 6,080,184 | 5,355,754 | ||
Loans | 10,523,378 | 10,523,378 | 9,879,659 | ||
Special Mention | |||||
Credit risk profile of portfolio | |||||
2024/2023 | 53,595 | 53,595 | 130,842 | ||
2023/2022 | 83,981 | 83,981 | 12,709 | ||
2022/2021 | 54,697 | 54,697 | 8,692 | ||
2021/2020 | 7,190 | 7,190 | 187 | ||
2020/2019 | 74 | ||||
Prior | 1,737 | 1,737 | 2,053 | ||
Revolving Loans | 42,800 | 42,800 | 36,710 | ||
Loans | 244,000 | 244,000 | 191,267 | ||
Substandard | |||||
Credit risk profile of portfolio | |||||
2024/2023 | 37,282 | ||||
2023/2022 | 118,042 | 118,042 | 39,055 | ||
2022/2021 | 70,793 | 70,793 | 37,018 | ||
2021/2020 | 32,968 | 32,968 | 878 | ||
2020/2019 | 822 | 822 | 62 | ||
Prior | 204 | 204 | 438 | ||
Revolving Loans | 24,010 | 24,010 | 13,844 | ||
Loans | 246,839 | 246,839 | 128,577 | ||
Doubtful | |||||
Credit risk profile of portfolio | |||||
Prior | 50 | ||||
Loans | 50 | ||||
Mortgage warehouse lines of credit | |||||
Credit risk profile of portfolio | |||||
Revolving Loans | 1,369,965 | 1,369,965 | 752,468 | ||
Loans | 1,369,965 | 1,369,965 | 752,468 | ||
Mortgage warehouse lines of credit | Pass | |||||
Credit risk profile of portfolio | |||||
Revolving Loans | 1,369,965 | 1,369,965 | 752,468 | ||
Loans | 1,369,965 | 1,369,965 | 752,468 | ||
Residential real estate | |||||
Credit risk profile of portfolio | |||||
2024/2023 | 16,683 | 16,683 | 31,011 | ||
2023/2022 | 33,162 | 33,162 | 10,086 | ||
2022/2021 | 8,392 | 8,392 | 6,573 | ||
2021/2020 | 5,921 | 5,921 | 22,725 | ||
2020/2019 | 20,799 | 20,799 | 3,357 | ||
Prior | 7,279 | 7,279 | 10,120 | ||
Revolving Loans | 1,253,420 | 1,253,420 | 1,240,433 | ||
Loans | 1,345,656 | 1,345,656 | 1,324,305 | ||
Net Charge-Offs | |||||
Charge-offs Prior | 21 | ||||
Charge-offs Revolving Loans | 13 | ||||
Net Charge-Offs | 13 | 13 | 34 | ||
Residential real estate | Pass | |||||
Credit risk profile of portfolio | |||||
2024/2023 | 16,683 | 16,683 | 31,011 | ||
2023/2022 | 33,162 | 33,162 | 10,086 | ||
2022/2021 | 8,370 | 8,370 | 6,573 | ||
2021/2020 | 5,921 | 5,921 | 22,725 | ||
2020/2019 | 20,799 | 20,799 | 3,298 | ||
Prior | 7,063 | 7,063 | 9,340 | ||
Revolving Loans | 1,247,690 | 1,247,690 | 1,239,161 | ||
Loans | 1,339,688 | 1,339,688 | 1,322,194 | ||
Residential real estate | Special Mention | |||||
Credit risk profile of portfolio | |||||
2020/2019 | 59 | ||||
Prior | 216 | 216 | 492 | ||
Loans | 216 | 216 | 551 | ||
Residential real estate | Substandard | |||||
Credit risk profile of portfolio | |||||
2022/2021 | 22 | 22 | |||
Prior | 288 | ||||
Revolving Loans | 5,730 | 5,730 | 1,272 | ||
Loans | 5,752 | 5,752 | 1,560 | ||
Multi-family financing | |||||
Credit risk profile of portfolio | |||||
2024/2023 | 543,022 | 543,022 | 1,201,353 | ||
2023/2022 | 898,700 | 898,700 | 793,997 | ||
2022/2021 | 759,239 | 759,239 | 223,277 | ||
2021/2020 | 118,280 | 118,280 | 77,340 | ||
2020/2019 | 6,760 | 6,760 | 29,764 | ||
Prior | 35,602 | 35,602 | 9,932 | ||
Revolving Loans | 1,798,817 | 1,798,817 | 1,670,497 | ||
Loans | 4,160,420 | 4,160,420 | 4,006,160 | ||
Net Charge-Offs | |||||
Charge-offs 2023/2022 | 870 | 8,400 | |||
Charge-offs 2022/2021 | 2,479 | ||||
Net Charge-Offs | 3,349 | 8,400 | 3,349 | 8,400 | 8,400 |
Multi-family financing | Pass | |||||
Credit risk profile of portfolio | |||||
2024/2023 | 514,012 | 514,012 | 1,094,698 | ||
2023/2022 | 800,439 | 800,439 | 762,448 | ||
2022/2021 | 658,884 | 658,884 | 208,343 | ||
2021/2020 | 115,723 | 115,723 | 77,340 | ||
2020/2019 | 6,760 | 6,760 | 29,764 | ||
Prior | 34,139 | 34,139 | 8,455 | ||
Revolving Loans | 1,768,242 | 1,768,242 | 1,646,445 | ||
Loans | 3,898,199 | 3,898,199 | 3,827,493 | ||
Multi-family financing | Special Mention | |||||
Credit risk profile of portfolio | |||||
2024/2023 | 29,010 | 29,010 | 94,973 | ||
2023/2022 | 16,869 | 16,869 | 3,189 | ||
2022/2021 | 29,853 | 29,853 | 8,400 | ||
Prior | 1,463 | 1,463 | 1,477 | ||
Revolving Loans | 23,836 | 23,836 | 24,052 | ||
Loans | 101,031 | 101,031 | 132,091 | ||
Multi-family financing | Substandard | |||||
Credit risk profile of portfolio | |||||
2024/2023 | 11,682 | ||||
2023/2022 | 81,392 | 81,392 | 28,360 | ||
2022/2021 | 70,502 | 70,502 | 6,534 | ||
2021/2020 | 2,557 | 2,557 | |||
Revolving Loans | 6,739 | 6,739 | |||
Loans | 161,190 | 161,190 | 46,576 | ||
Healthcare financing | |||||
Credit risk profile of portfolio | |||||
2024/2023 | 448,928 | 448,928 | 814,060 | ||
2023/2022 | 559,820 | 559,820 | 1,016,418 | ||
2022/2021 | 926,491 | 926,491 | 138,980 | ||
2021/2020 | 103,791 | 103,791 | |||
2020/2019 | 14,563 | ||||
Prior | 14,356 | 14,356 | |||
Revolving Loans | 442,524 | 442,524 | 372,668 | ||
Loans | 2,495,910 | 2,495,910 | 2,356,689 | ||
Healthcare financing | Pass | |||||
Credit risk profile of portfolio | |||||
2024/2023 | 424,343 | 424,343 | 752,591 | ||
2023/2022 | 456,170 | 456,170 | 996,273 | ||
2022/2021 | 901,647 | 901,647 | 110,197 | ||
2021/2020 | 75,333 | 75,333 | |||
2020/2019 | 14,563 | ||||
Prior | 14,356 | 14,356 | |||
Revolving Loans | 415,686 | 415,686 | 351,110 | ||
Loans | 2,287,535 | 2,287,535 | 2,224,734 | ||
Healthcare financing | Special Mention | |||||
Credit risk profile of portfolio | |||||
2024/2023 | 24,585 | 24,585 | 35,869 | ||
2023/2022 | 67,000 | 67,000 | 9,520 | ||
2022/2021 | 24,844 | 24,844 | |||
Revolving Loans | 18,537 | 18,537 | 12,658 | ||
Loans | 134,966 | 134,966 | 58,047 | ||
Healthcare financing | Substandard | |||||
Credit risk profile of portfolio | |||||
2024/2023 | 25,600 | ||||
2023/2022 | 36,650 | 36,650 | 10,625 | ||
2022/2021 | 28,783 | ||||
2021/2020 | 28,458 | 28,458 | |||
Revolving Loans | 8,301 | 8,301 | 8,900 | ||
Loans | 73,409 | 73,409 | 73,908 | ||
Commercial and commercial real estate | |||||
Credit risk profile of portfolio | |||||
2024/2023 | 29,422 | 29,422 | 51,110 | ||
2023/2022 | 48,553 | 48,553 | 119,456 | ||
2022/2021 | 110,586 | 110,586 | 79,309 | ||
2021/2020 | 71,380 | 71,380 | 22,204 | ||
2020/2019 | 19,568 | 19,568 | 21,150 | ||
Prior | 24,292 | 24,292 | 17,200 | ||
Revolving Loans | 1,263,008 | 1,263,008 | 1,332,652 | ||
Loans | 1,566,809 | 1,566,809 | 1,643,081 | ||
Net Charge-Offs | |||||
Charge-offs 2023/2022 | 496 | ||||
Charge-offs 2022/2021 | 103 | 274 | |||
Charge-offs 2021/2020 | 925 | 586 | |||
Net Charge-Offs | 103 | 1,118 | 1,028 | 1,118 | 1,356 |
Commercial and commercial real estate | Pass | |||||
Credit risk profile of portfolio | |||||
2024/2023 | 29,422 | 29,422 | 51,110 | ||
2023/2022 | 48,441 | 48,441 | 119,386 | ||
2022/2021 | 110,317 | 110,317 | 77,316 | ||
2021/2020 | 62,237 | 62,237 | 21,154 | ||
2020/2019 | 18,746 | 18,746 | 21,088 | ||
Prior | 24,177 | 24,177 | 17,066 | ||
Revolving Loans | 1,259,341 | 1,259,341 | 1,328,980 | ||
Loans | 1,552,681 | 1,552,681 | 1,636,100 | ||
Commercial and commercial real estate | Special Mention | |||||
Credit risk profile of portfolio | |||||
2023/2022 | 112 | 112 | |||
2022/2021 | 292 | ||||
2021/2020 | 7,190 | 7,190 | 172 | ||
Prior | 58 | 58 | 84 | ||
Revolving Loans | 427 | 427 | |||
Loans | 7,787 | 7,787 | 548 | ||
Commercial and commercial real estate | Substandard | |||||
Credit risk profile of portfolio | |||||
2023/2022 | 70 | ||||
2022/2021 | 269 | 269 | 1,701 | ||
2021/2020 | 1,953 | 1,953 | 878 | ||
2020/2019 | 822 | 822 | 62 | ||
Prior | 57 | 57 | |||
Revolving Loans | 3,240 | 3,240 | 3,672 | ||
Loans | 6,341 | 6,341 | 6,383 | ||
Agricultural production and real estate | |||||
Credit risk profile of portfolio | |||||
2024/2023 | 13,636 | 13,636 | 16,850 | ||
2023/2022 | 7,246 | 7,246 | 9,825 | ||
2022/2021 | 4,855 | 4,855 | 6,490 | ||
2021/2020 | 2,601 | 2,601 | 14,267 | ||
2020/2019 | 8,482 | 8,482 | 5,237 | ||
Prior | 14,835 | 14,835 | 16,753 | ||
Revolving Loans | 18,589 | 18,589 | 33,728 | ||
Loans | 70,244 | 70,244 | 103,150 | ||
Agricultural production and real estate | Pass | |||||
Credit risk profile of portfolio | |||||
2024/2023 | 13,636 | 13,636 | 16,850 | ||
2023/2022 | 7,246 | 7,246 | 9,825 | ||
2022/2021 | 4,855 | 4,855 | 6,490 | ||
2021/2020 | 2,601 | 2,601 | 14,267 | ||
2020/2019 | 8,482 | 8,482 | 5,237 | ||
Prior | 14,688 | 14,688 | 16,606 | ||
Revolving Loans | 18,589 | 18,589 | 33,728 | ||
Loans | 70,097 | 70,097 | 103,003 | ||
Agricultural production and real estate | Substandard | |||||
Credit risk profile of portfolio | |||||
Prior | 147 | 147 | 147 | ||
Loans | 147 | 147 | 147 | ||
Consumer and margin loans | |||||
Credit risk profile of portfolio | |||||
2024/2023 | 174 | 174 | 748 | ||
2023/2022 | 92 | 92 | 4,329 | ||
2022/2021 | 25 | 25 | 247 | ||
2021/2020 | 21 | 21 | 130 | ||
2020/2019 | 42 | ||||
Prior | 4,230 | 4,230 | 4,342 | ||
Revolving Loans | 671 | 671 | 3,862 | ||
Loans | 5,213 | 5,213 | 13,700 | ||
Net Charge-Offs | |||||
Charge-offs Prior | 1 | ||||
Net Charge-Offs | $ 1 | $ 1 | 1 | ||
Consumer and margin loans | Pass | |||||
Credit risk profile of portfolio | |||||
2024/2023 | 174 | 174 | 748 | ||
2023/2022 | 92 | 92 | 4,329 | ||
2022/2021 | 25 | 25 | 247 | ||
2021/2020 | 21 | 21 | 115 | ||
2020/2019 | 27 | ||||
Prior | 4,230 | 4,230 | 4,339 | ||
Revolving Loans | 671 | 671 | 3,862 | ||
Loans | $ 5,213 | $ 5,213 | 13,667 | ||
Consumer and margin loans | Special Mention | |||||
Credit risk profile of portfolio | |||||
2021/2020 | 15 | ||||
2020/2019 | 15 | ||||
Loans | 30 | ||||
Consumer and margin loans | Substandard | |||||
Credit risk profile of portfolio | |||||
Prior | 3 | ||||
Loans | $ 3 |
Loans and Allowance for Credi_7
Loans and Allowance for Credit Losses on Loans - Aging Analysis Of The Recorded Investment In Loans (Details) | Jun. 30, 2024 USD ($) loan | Dec. 31, 2023 USD ($) |
Aging analysis of loan portfolio | ||
Loans | $ 11,014,217,000 | $ 10,199,553,000 |
Number of delinquent loans classified as held for sale | 0 | 1 |
Loan as held for sale | $ 16,500,000 | |
Total Past Due | ||
Aging analysis of loan portfolio | ||
Loans | $ 234,848,000 | 183,529,000 |
30-59 Days Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 40,743,000 | 42,975,000 |
60-89 Days Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 67,791,000 | 58,737,000 |
90+ Days Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 126,314,000 | 81,817,000 |
Current | ||
Aging analysis of loan portfolio | ||
Loans | 10,779,369,000 | 10,016,024,000 |
Mortgage warehouse lines of credit | ||
Aging analysis of loan portfolio | ||
Loans | 1,369,965,000 | 752,468,000 |
Mortgage warehouse lines of credit | Current | ||
Aging analysis of loan portfolio | ||
Loans | 1,369,965,000 | 752,468,000 |
Residential real estate | ||
Aging analysis of loan portfolio | ||
Loans | 1,345,656,000 | 1,324,305,000 |
Residential real estate | Total Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 6,270,000 | 6,936,000 |
Residential real estate | 30-59 Days Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 4,557,000 | |
Residential real estate | 60-89 Days Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 1,026,000 | |
Residential real estate | 90+ Days Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 5,244,000 | 2,379,000 |
Residential real estate | Current | ||
Aging analysis of loan portfolio | ||
Loans | 1,339,386,000 | 1,317,369,000 |
Healthcare financing | ||
Aging analysis of loan portfolio | ||
Loans | 2,495,910,000 | 2,356,689,000 |
Healthcare financing | Total Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 73,410,000 | 83,274,000 |
Healthcare financing | 60-89 Days Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 25,601,000 | 47,275,000 |
Healthcare financing | 90+ Days Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 47,809,000 | 35,999,000 |
Healthcare financing | Current | ||
Aging analysis of loan portfolio | ||
Loans | 2,422,500,000 | 2,273,415,000 |
Multi-family financing | ||
Aging analysis of loan portfolio | ||
Loans | 4,160,420,000 | 4,006,160,000 |
Multi-family financing | Total Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 150,608,000 | 88,882,000 |
Multi-family financing | 30-59 Days Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 40,743,000 | 38,218,000 |
Multi-family financing | 60-89 Days Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 40,719,000 | 11,055,000 |
Multi-family financing | 90+ Days Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 69,146,000 | 39,609,000 |
Multi-family financing | Current | ||
Aging analysis of loan portfolio | ||
Loans | 4,009,812,000 | 3,917,278,000 |
Commercial and commercial real estate | ||
Aging analysis of loan portfolio | ||
Loans | 1,566,809,000 | 1,643,081,000 |
Commercial and commercial real estate | Total Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 4,404,000 | 4,230,000 |
Commercial and commercial real estate | 30-59 Days Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 172,000 | |
Commercial and commercial real estate | 60-89 Days Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 445,000 | 393,000 |
Commercial and commercial real estate | 90+ Days Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 3,959,000 | 3,665,000 |
Commercial and commercial real estate | Current | ||
Aging analysis of loan portfolio | ||
Loans | 1,562,405,000 | 1,638,851,000 |
Agricultural production and real estate | ||
Aging analysis of loan portfolio | ||
Loans | 70,244,000 | 103,150,000 |
Agricultural production and real estate | Total Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 156,000 | 185,000 |
Agricultural production and real estate | 30-59 Days Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 27,000 | |
Agricultural production and real estate | 60-89 Days Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 11,000 | |
Agricultural production and real estate | 90+ Days Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 156,000 | 147,000 |
Agricultural production and real estate | Current | ||
Aging analysis of loan portfolio | ||
Loans | 70,088,000 | 102,965,000 |
Consumer and margin loans | ||
Aging analysis of loan portfolio | ||
Loans | 5,213,000 | 13,700,000 |
Consumer and margin loans | Total Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 22,000 | |
Consumer and margin loans | 30-59 Days Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 1,000 | |
Consumer and margin loans | 60-89 Days Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 3,000 | |
Consumer and margin loans | 90+ Days Past Due | ||
Aging analysis of loan portfolio | ||
Loans | 18,000 | |
Consumer and margin loans | Current | ||
Aging analysis of loan portfolio | ||
Loans | $ 5,213,000 | $ 13,678,000 |
Loans and Allowance for Credi_8
Loans and Allowance for Credit Losses on Loans - Non Accrual Loans and Loans Past Due 90 Days Or More and Still Accruing (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2024 | Jun. 30, 2024 | Dec. 31, 2023 | |
Loan portfolio past due loans | |||
Nonaccrual | $ 143,319 | $ 143,319 | $ 73,847 |
Total Loans Greater than 90 Days & Accruing | 133 | 133 | 8,168 |
Interest income recognized on nonaccrual financial assets | 900 | 900 | |
Specific reserves | 8,700 | 8,700 | 5,400 |
Nonaccrual loans | 46,400 | 46,400 | 20,700 |
Residential Portfolio Segment [Member] | |||
Loan portfolio past due loans | |||
Nonaccrual | 5,244 | 5,244 | 1,486 |
Total Loans Greater than 90 Days & Accruing | 894 | ||
Multi-family financing | |||
Loan portfolio past due loans | |||
Nonaccrual | 86,284 | 86,284 | 39,608 |
Healthcare financing | |||
Loan portfolio past due loans | |||
Nonaccrual | 47,809 | 47,809 | 28,783 |
Total Loans Greater than 90 Days & Accruing | 7,216 | ||
Commercial and commercial real estate | |||
Loan portfolio past due loans | |||
Nonaccrual | 3,835 | 3,835 | 3,820 |
Total Loans Greater than 90 Days & Accruing | 124 | 124 | 43 |
Agricultural production and real estate | |||
Loan portfolio past due loans | |||
Nonaccrual | 147 | 147 | 147 |
Total Loans Greater than 90 Days & Accruing | $ 9 | $ 9 | |
Consumer and margin loans | |||
Loan portfolio past due loans | |||
Nonaccrual | 3 | ||
Total Loans Greater than 90 Days & Accruing | $ 15 |
Loans and Allowance for Credi_9
Loans and Allowance for Credit Losses on Loans - Modified loans (Details) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2024 USD ($) item | Jun. 30, 2024 USD ($) item | |
Loan portfolio past due loans | ||
Modified loans | $ 186,442 | $ 186,442 |
Number of modified loans defaulted during the period | item | 0 | 0 |
Current | ||
Loan portfolio past due loans | ||
Modified loans | $ 154,709 | $ 154,709 |
90+ Days Past Due | ||
Loan portfolio past due loans | ||
Modified loans | 31,733 | 31,733 |
Payment Deferral | ||
Loan portfolio past due loans | ||
Modified loans | 31,733 | 31,733 |
Term Extension | ||
Loan portfolio past due loans | ||
Modified loans | 154,709 | 154,709 |
Multi-family financing | ||
Loan portfolio past due loans | ||
Modified loans | 157,941 | 157,941 |
Multi-family financing | Current | ||
Loan portfolio past due loans | ||
Modified loans | 126,208 | 126,208 |
Multi-family financing | 90+ Days Past Due | ||
Loan portfolio past due loans | ||
Modified loans | 31,733 | 31,733 |
Multi-family financing | Payment Deferral | ||
Loan portfolio past due loans | ||
Modified loans | $ 31,733 | $ 31,733 |
Forbearance average period | 13 months | 13 months |
Multi-family financing | Term Extension | ||
Loan portfolio past due loans | ||
Modified loans | $ 126,208 | $ 126,208 |
Weighted average term increase from modification | 20 months | 20 months |
Healthcare financing | ||
Loan portfolio past due loans | ||
Modified loans | $ 28,501 | $ 28,501 |
Healthcare financing | Current | ||
Loan portfolio past due loans | ||
Modified loans | 28,501 | 28,501 |
Healthcare financing | Term Extension | ||
Loan portfolio past due loans | ||
Modified loans | $ 28,501 | $ 28,501 |
Weighted average term increase from modification | 20 months | 20 months |
Loans and Allowance for Cred_10
Loans and Allowance for Credit Losses on Loans - Narrative (Details) $ in Thousands | 6 Months Ended | |||
Apr. 30, 2024 USD ($) loan | Jun. 30, 2024 USD ($) loan | Jun. 30, 2023 USD ($) | Dec. 31, 2023 loan | |
Loans and Allowance for Credit Losses on Loans | ||||
Purchase of loans | $ 68,468 | $ 269,855 | ||
Multi-family financing | Loan Sale and Freddie Mac Q Series Securitization | ||||
Loans and Allowance for Credit Losses on Loans | ||||
Amount of portfolio of loans sold in a securitization transaction | $ 324,600 | |||
Number of loans securitized | loan | 13 | |||
Gain on sale of loans | $ 1,400 | |||
Mortgage servicing right established | $ 1,300 | |||
Residential real estate | ||||
Loans and Allowance for Credit Losses on Loans | ||||
Number of loans in the process of foreclosure | loan | 0 | 0 |
Variable Interest Entities (V_3
Variable Interest Entities (VIEs) (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 | |
Variable Interest Entities | |||
Liabilities for VIEs | $ 16,324,275 | $ 15,251,432 | [1] |
Variable Interest Entity, Not Primary Beneficiary | |||
Variable Interest Entities | |||
Investments in VIEs | 138,582 | 151,962 | |
Bridge loans to VIEs | 207,535 | 318,823 | |
Securities for VIEs | 1,279,174 | 1,192,201 | |
Maximum Exposure to Loss | 1,625,291 | 1,662,986 | |
Liabilities for VIEs | 30,787 | 37,851 | |
Low-income housing tax credit investments | Variable Interest Entity, Not Primary Beneficiary | |||
Variable Interest Entities | |||
Investments in VIEs | 107,402 | 118,741 | |
Bridge loans to VIEs | 151,890 | 232,407 | |
Maximum Exposure to Loss | 259,292 | 351,148 | |
Liabilities for VIEs | 28,035 | 35,099 | |
Debt funds | Variable Interest Entity, Not Primary Beneficiary | |||
Variable Interest Entities | |||
Investments in VIEs | 31,180 | 33,221 | |
Bridge loans to VIEs | 35,855 | 86,416 | |
Maximum Exposure to Loss | 67,035 | 119,637 | |
Liabilities for VIEs | 2,752 | 2,752 | |
Off-balance-sheet REMIC trusts | Variable Interest Entity, Not Primary Beneficiary | |||
Variable Interest Entities | |||
Bridge loans to VIEs | 19,790 | ||
Securities for VIEs | 1,279,174 | 1,192,201 | |
Maximum Exposure to Loss | $ 1,298,964 | $ 1,192,201 | |
[1] *Derived from audited consolidated financial statements |
Regulatory Matters (Details)
Regulatory Matters (Details) $ in Thousands | Jun. 30, 2024 USD ($) | Dec. 31, 2023 USD ($) |
Company | ||
Total Capital (to risk-weighted assets) | ||
Total Capital (to risk-weighted assets), Actual, Amount | $ 1,977,729 | $ 1,772,195 |
Total Capital (to risk weighted assets), Actual, Ratio (as a percent) | 0.120 | 0.116 |
Total Capital (to risk weighted assets), Minimum Amount to be Well Capitalized with Basel III Buffer, Amount | $ 1,726,065 | $ 1,598,260 |
Total Capital (to risk weighted assets), Minimum Amount to be Well Capitalized with Basel III Buffer, Ratio (as a percent) | 0.105 | 0.105 |
Tier I Capital (to risk-weighted assets) | ||
Tier I Capital, (to risk-weighted assets), Actual, Amount | $ 1,879,605 | $ 1,686,202 |
Tier I Capital (to risk weighted assets), Actual, Ratio (as a percent) | 0.114 | 0.111 |
Tier I Capital (to risk weighted assets), Minimum Amount to be Well Capitalized with Basel III Buffer, Amount | $ 1,397,291 | $ 1,293,830 |
Tier I Capital (to risk weighted assets), Minimum Amount to be Well Capitalized with Basel III Buffer, Ratio (as a percent) | 0.085 | 0.085 |
Common Equity Tier I Capital (to risk-weighted assets) | ||
Common Equity Tier I Capital (to risk weighted assets), Actual, Amount | $ 1,430,219 | $ 1,186,594 |
Common Equity Tier I Capital (to risk weighted assets), Ratio (as a percent) | 0.087 | 0.078 |
Common Equity Tier I Capital (to risk weighted assets), Minimum Amount to be Well Capitalized with Basel III Buffer, Amount | $ 1,150,710 | $ 1,065,507 |
Common Equity Tier I Capital (to risk weighted assets, Minimum Amount Required to be Well Capitalized with Basel III Buffer, Ratio (as a percent) | 0.070 | 0.070 |
Tier 1 Capital (to average assets) | ||
Tier 1 Capital (to average assets), Actual, Amount | $ 1,879,605 | $ 1,686,202 |
Tier 1 Capital (to average assets), Actual, Ratio (as a percent) | 0.106 | 0.101 |
Tier 1 Capital (to average assets), Minimum Amount Required to be Well Capitalized with Basel III Buffer, Amount | $ 890,257 | $ 832,706 |
Tier 1 Capital (to average assets), Minimum Amount Required to be Well Capitalized with Basel III Buffer, Ratio (as a percent) | 0.050 | 0.050 |
Merchants Bank | ||
Total Capital (to risk-weighted assets) | ||
Total Capital (to risk-weighted assets), Actual, Amount | $ 1,971,631 | $ 1,724,505 |
Total Capital (to risk weighted assets), Actual, Ratio (as a percent) | 0.120 | 0.115 |
Total Capital (to risk weighted assets), Minimum Amount to be Well Capitalized with Basel III Buffer, Amount | $ 1,725,481 | $ 1,577,434 |
Total Capital (to risk weighted assets), Minimum Amount to be Well Capitalized with Basel III Buffer, Ratio (as a percent) | 0.105 | 0.105 |
Total Capital (to risk weighted assets), Minimum Amount To Be Well Capitalized, Amount | $ 1,643,316 | $ 1,502,318 |
Total Capital (to risk weighted assets), Minimum Amount To Be Well Capitalized, Ratio (as a percent) | 0.100 | 0.100 |
Tier I Capital (to risk-weighted assets) | ||
Tier I Capital, (to risk-weighted assets), Actual, Amount | $ 1,873,508 | $ 1,639,171 |
Tier I Capital (to risk weighted assets), Actual, Ratio (as a percent) | 0.114 | 0.109 |
Tier I Capital (to risk weighted assets), Minimum Amount to be Well Capitalized with Basel III Buffer, Amount | $ 1,396,818 | $ 1,276,970 |
Tier I Capital (to risk weighted assets), Minimum Amount to be Well Capitalized with Basel III Buffer, Ratio (as a percent) | 0.085 | 0.085 |
Tier I Capital (to risk weighted assets), Minimum Amount To Be Well Capitalized, Amount | $ 1,314,653 | $ 1,201,854 |
Tier I Capital (to risk weighted assets), Minimum Amount To Be Well Capitalized, Ratio (as a percent) | 0.080 | 0.080 |
Common Equity Tier I Capital (to risk-weighted assets) | ||
Common Equity Tier I Capital (to risk weighted assets), Actual, Amount | $ 1,873,508 | $ 1,639,171 |
Common Equity Tier I Capital (to risk weighted assets), Ratio (as a percent) | 0.114 | 0.109 |
Common Equity Tier I Capital (to risk weighted assets), Minimum Amount to be Well Capitalized with Basel III Buffer, Amount | $ 1,150,321 | $ 1,051,623 |
Common Equity Tier I Capital (to risk weighted assets, Minimum Amount Required to be Well Capitalized with Basel III Buffer, Ratio (as a percent) | 0.070 | 0.070 |
Common Equity Tier I Capital (to risk weighted assets), Minimum Amount To Be Well Capitalized, Amount | $ 1,068,155 | $ 976,507 |
Common Equity Tier I Capital (to risk weighted assets), Minimum Amount To Be Well Capitalized, Ratio (as a percent) | 0.065 | 0.065 |
Tier 1 Capital (to average assets) | ||
Tier 1 Capital (to average assets), Actual, Amount | $ 1,873,508 | $ 1,639,171 |
Tier 1 Capital (to average assets), Actual, Ratio (as a percent) | 0.105 | 0.101 |
Tier 1 Capital (to average assets), Minimum Amount Required to be Well Capitalized with Basel III Buffer, Amount | $ 887,924 | $ 815,191 |
Tier 1 Capital (to average assets), Minimum Amount Required to be Well Capitalized with Basel III Buffer, Ratio (as a percent) | 0.050 | 0.050 |
Tier 1 Capital (to average assets), Minimum Amount To Be Well Capitalized, Amount | $ 887,924 | $ 815,191 |
Tier 1 Capital (to average assets), Minimum Amount To Be Well Capitalized, Ratio (as a percent) | 0.050 | 0.050 |
FMBI | ||
Total Capital (to risk-weighted assets) | ||
Total Capital (to risk-weighted assets), Actual, Amount | $ 40,613 | |
Total Capital (to risk weighted assets), Actual, Ratio (as a percent) | 0.211 | |
Total Capital (to risk weighted assets), Minimum Amount to be Well Capitalized with Basel III Buffer, Amount | $ 20,209 | |
Total Capital (to risk weighted assets), Minimum Amount to be Well Capitalized with Basel III Buffer, Ratio (as a percent) | 0.105 | |
Total Capital (to risk weighted assets), Minimum Amount To Be Well Capitalized, Amount | $ 19,247 | |
Total Capital (to risk weighted assets), Minimum Amount To Be Well Capitalized, Ratio (as a percent) | 0.100 | |
Tier I Capital (to risk-weighted assets) | ||
Tier I Capital, (to risk-weighted assets), Actual, Amount | $ 39,953 | |
Tier I Capital (to risk weighted assets), Actual, Ratio (as a percent) | 0.208 | |
Tier I Capital (to risk weighted assets), Minimum Amount to be Well Capitalized with Basel III Buffer, Amount | $ 16,360 | |
Tier I Capital (to risk weighted assets), Minimum Amount to be Well Capitalized with Basel III Buffer, Ratio (as a percent) | 0.085 | |
Tier I Capital (to risk weighted assets), Minimum Amount To Be Well Capitalized, Amount | $ 15,398 | |
Tier I Capital (to risk weighted assets), Minimum Amount To Be Well Capitalized, Ratio (as a percent) | 0.080 | |
Common Equity Tier I Capital (to risk-weighted assets) | ||
Common Equity Tier I Capital (to risk weighted assets), Actual, Amount | $ 39,953 | |
Common Equity Tier I Capital (to risk weighted assets), Ratio (as a percent) | 0.208 | |
Common Equity Tier I Capital (to risk weighted assets), Minimum Amount to be Well Capitalized with Basel III Buffer, Amount | $ 13,473 | |
Common Equity Tier I Capital (to risk weighted assets, Minimum Amount Required to be Well Capitalized with Basel III Buffer, Ratio (as a percent) | 0.070 | |
Common Equity Tier I Capital (to risk weighted assets), Minimum Amount To Be Well Capitalized, Amount | $ 12,511 | |
Common Equity Tier I Capital (to risk weighted assets), Minimum Amount To Be Well Capitalized, Ratio (as a percent) | 0.065 | |
Tier 1 Capital (to average assets) | ||
Tier 1 Capital (to average assets), Actual, Amount | $ 39,953 | |
Tier 1 Capital (to average assets), Actual, Ratio (as a percent) | 0.115 | |
Tier 1 Capital (to average assets), Minimum Amount Required to be Well Capitalized with Basel III Buffer, Amount | $ 17,391 | |
Tier 1 Capital (to average assets), Minimum Amount Required to be Well Capitalized with Basel III Buffer, Ratio (as a percent) | 0.050 | |
Tier 1 Capital (to average assets), Minimum Amount To Be Well Capitalized, Amount | $ 17,391 | |
Tier 1 Capital (to average assets), Minimum Amount To Be Well Capitalized, Ratio (as a percent) | 0.050 |
Derivative Financial Instrume_3
Derivative Financial Instruments (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2024 USD ($) | Jun. 30, 2024 USD ($) customer | Jun. 30, 2023 USD ($) | Jun. 30, 2024 USD ($) customer | Jun. 30, 2023 USD ($) | Dec. 31, 2023 USD ($) | |
Derivative Financial Instruments | ||||||
Number of warehouse loan customers | customer | 2 | 2 | ||||
Derivative Asset, Statement of Financial Position [Extensible Enumeration] | Other Assets and Receivables | Other Assets and Receivables | Other Assets and Receivables | |||
Derivative Liability, Statement of Financial Position [Extensible Enumeration] | Other Liabilities | Other Liabilities | Other Liabilities | |||
The periodic changes in the fair value of the derivative financial instruments on the condensed consolidated statements of income | ||||||
Net swap gains (losses) | $ 3,681 | $ 13,628 | ||||
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Noninterest Income, Other | Noninterest Income, Other | Noninterest Income, Other | Noninterest Income, Other | ||
Pledged in collateral | $ 0 | $ 0 | $ 0 | |||
Derivative Financial Instruments, Assets [Member] | ||||||
Derivative Financial Instruments | ||||||
Derivative assets, fair value | 50,632 | 50,632 | 35,207 | |||
Derivative liabilities | ||||||
Derivative Financial Instruments | ||||||
Derivative liabilities, fair value | 215 | 215 | 395 | |||
Derivative | ||||||
The periodic changes in the fair value of the derivative financial instruments on the condensed consolidated statements of income | ||||||
Net swap gains (losses) | $ 423 | $ 1,785 | $ 1,908 | $ 562 | ||
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Gain (Loss) on Sales of Loans, Net | Gain (Loss) on Sales of Loans, Net | Gain (Loss) on Sales of Loans, Net | Gain (Loss) on Sales of Loans, Net | ||
Interest rate lock commitments | ||||||
Derivative Financial Instruments | ||||||
Notional amount | $ 50,471 | $ 50,471 | 16,526 | |||
The periodic changes in the fair value of the derivative financial instruments on the condensed consolidated statements of income | ||||||
Net swap gains (losses) | (109) | $ (188) | (93) | $ 21 | ||
Interest rate lock commitments | Derivative Financial Instruments, Assets [Member] | ||||||
Derivative Financial Instruments | ||||||
Derivative assets, fair value | 170 | 170 | 140 | |||
Interest rate lock commitments | Derivative liabilities | ||||||
Derivative Financial Instruments | ||||||
Derivative liabilities, fair value | 127 | 127 | 4 | |||
Forward contracts | ||||||
Derivative Financial Instruments | ||||||
Notional amount | 60,524 | 60,524 | 25,500 | |||
The periodic changes in the fair value of the derivative financial instruments on the condensed consolidated statements of income | ||||||
Net swap gains (losses) | 285 | 376 | 379 | 280 | ||
Forward contracts | Derivative Financial Instruments, Assets [Member] | ||||||
Derivative Financial Instruments | ||||||
Derivative assets, fair value | 149 | 149 | 4 | |||
Forward contracts | Derivative liabilities | ||||||
Derivative Financial Instruments | ||||||
Derivative liabilities, fair value | 88 | 88 | 391 | |||
Interest rate swaps | ||||||
Derivative Financial Instruments | ||||||
Notional amount | 57,513 | 57,513 | 57,540 | |||
The periodic changes in the fair value of the derivative financial instruments on the condensed consolidated statements of income | ||||||
Net swap gains (losses) | 247 | 1,597 | 1,622 | 261 | ||
Interest rate swaps | Derivative Financial Instruments, Assets [Member] | ||||||
Derivative Financial Instruments | ||||||
Derivative assets, fair value | 4,232 | 4,232 | 2,610 | |||
Interest rate swaps, caps and floors (back-to-back) | ||||||
Derivative Financial Instruments | ||||||
Notional amount | 637,876 | 637,876 | 607,169 | |||
The periodic changes in the fair value of the derivative financial instruments on the condensed consolidated statements of income | ||||||
Gross swap gains | 5,371 | 7,016 | 2,538 | 6,436 | ||
Gross swap losses | 5,371 | $ 7,016 | 2,538 | $ 6,436 | ||
Interest rate swaps, caps and floors (back-to-back) | Derivative Financial Instruments, Assets [Member] | ||||||
Derivative Financial Instruments | ||||||
Derivative assets, fair value | 9,888 | 9,888 | 12,426 | |||
Interest rate swaps, caps and floors (back-to-back) | Derivative liabilities | ||||||
Derivative Financial Instruments | ||||||
Derivative liabilities, fair value | 9,888 | 9,888 | 12,426 | |||
Put option | ||||||
Derivative Financial Instruments | ||||||
Notional amount | 719,731 | 719,731 | 748,374 | |||
The periodic changes in the fair value of the derivative financial instruments on the condensed consolidated statements of income | ||||||
Net swap gains (losses) | 3,467 | 11,080 | ||||
Put option | Derivative Financial Instruments, Assets [Member] | ||||||
Derivative Financial Instruments | ||||||
Derivative assets, fair value | 36,957 | 36,957 | 25,877 | |||
Interest rate floors | ||||||
Derivative Financial Instruments | ||||||
Notional amount | 1,224,171 | 1,224,171 | 748,374 | |||
The periodic changes in the fair value of the derivative financial instruments on the condensed consolidated statements of income | ||||||
Net swap gains (losses) | 214 | 2,548 | ||||
Interest rate floors | Derivative Financial Instruments, Assets [Member] | ||||||
Derivative Financial Instruments | ||||||
Derivative assets, fair value | 9,124 | 9,124 | $ 6,576 | |||
Credit derivatives | ||||||
Derivative Financial Instruments | ||||||
Notional amount | $ 76,081 | 76,081 | ||||
Credit Default Swap | ||||||
The periodic changes in the fair value of the derivative financial instruments on the condensed consolidated statements of income | ||||||
Net swap gains (losses) | $ 0 | |||||
Credit Default Swap | Multifamily mortgage loans | ||||||
Derivative Financial Instruments | ||||||
Aggregate collateral obligation | $ 76,100 |
Disclosures about Fair Value _3
Disclosures about Fair Value of Assets and Liabilities - Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 | |
Disclosures about Fair Value of Assets and Liabilities | |||
Mortgage loans in process of securitization | $ 209,244 | $ 110,599 | [1] |
Fair Value | 1,017,019 | 1,113,687 | [1] |
Loans held for sale | 102,873 | 86,663 | |
Servicing rights | 178,776 | 158,457 | [1] |
Recurring | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Mortgage loans in process of securitization | 209,244 | 110,599 | |
Loans held for sale | 102,873 | 86,663 | |
Servicing rights | 178,776 | 158,457 | |
Recurring | Interest rate lock commitments | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Derivative assets | 170 | 140 | |
Derivative liabilities | 127 | 4 | |
Recurring | Forward contracts | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Derivative assets | 149 | 4 | |
Derivative liabilities | 88 | 391 | |
Recurring | Interest rate swaps | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Derivative assets | 4,232 | 2,610 | |
Recurring | Interest rate swaps, caps and floors (back-to-back) | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Derivative assets | 9,888 | 12,426 | |
Derivative liabilities | 9,888 | 12,426 | |
Recurring | Put option | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Derivative assets | 36,957 | 25,877 | |
Recurring | Interest rate floors | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Derivative assets | 9,124 | 6,576 | |
Level 2 | Recurring | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Mortgage loans in process of securitization | 209,244 | 110,599 | |
Loans held for sale | 102,873 | 86,663 | |
Level 2 | Recurring | Forward contracts | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Derivative assets | 149 | 4 | |
Derivative liabilities | 88 | 391 | |
Level 2 | Recurring | Interest rate swaps | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Derivative assets | 4,232 | 2,610 | |
Level 2 | Recurring | Interest rate swaps, caps and floors (back-to-back) | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Derivative assets | 9,888 | 12,426 | |
Derivative liabilities | 9,888 | 12,426 | |
Level 2 | Recurring | Put option | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Derivative assets | 12,300 | 7,223 | |
Level 3 | Interest rate lock commitments | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Derivative assets | 170 | 140 | |
Derivative liabilities | 127 | 4 | |
Level 3 | Recurring | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Servicing rights | 178,776 | 158,457 | |
Level 3 | Recurring | Interest rate lock commitments | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Derivative assets | 170 | 140 | |
Derivative liabilities | 127 | 4 | |
Level 3 | Recurring | Put option | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Derivative assets | 24,657 | 18,654 | |
Level 3 | Recurring | Interest rate floors | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Derivative assets | 9,124 | 6,576 | |
Treasury notes | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Fair Value | 109,079 | 128,968 | |
Treasury notes | Recurring | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Fair Value | 109,079 | 128,968 | |
Treasury notes | Level 1 | Recurring | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Fair Value | 109,079 | 128,968 | |
Federal agencies | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Fair Value | 219,318 | 247,755 | |
Federal agencies | Recurring | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Fair Value | 219,318 | 247,755 | |
Federal agencies | Level 2 | Recurring | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Fair Value | 219,318 | 247,755 | |
Mortgage-backed - Government Agency ("Agency") | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Fair Value | 5,848 | 14,467 | |
Mortgage-backed - Government Agency ("Agency") | Recurring | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Fair Value | 5,848 | 14,467 | |
Mortgage-backed - Government Agency ("Agency") | Level 2 | Recurring | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Fair Value | 5,848 | 14,467 | |
Mortgage-backed - Non-Agency residential | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Fair Value | 462,627 | 485,500 | |
Mortgage-backed - Non-Agency residential | Recurring | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Fair Value | 462,627 | 485,500 | |
Mortgage-backed - Non-Agency residential | Level 3 | Recurring | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Fair Value | 462,627 | 485,500 | |
Mortgage-backed - Agency - fair value option | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Fair Value | 220,147 | 236,997 | |
Mortgage-backed - Agency - fair value option | Recurring | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Fair Value | 220,147 | 236,997 | |
Mortgage-backed - Agency - fair value option | Level 2 | Recurring | |||
Disclosures about Fair Value of Assets and Liabilities | |||
Fair Value | $ 220,147 | $ 236,997 | |
[1] *Derived from audited consolidated financial statements |
Disclosures about Fair Value _4
Disclosures about Fair Value of Assets and Liabilities - Reconciliation of Unobservable Inputs (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Put option | ||||
Reconciliation of significant unobservable inputs, assets: | ||||
Balance, beginning of period | $ 22,976 | $ 18,654 | ||
Subtractions | ||||
Changes in fair value | $ 1,681 | $ 6,003 | ||
Fair Value, Net Derivative Asset (Liability), Recurring Basis, Still Held, Unrealized Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Noninterest Expense, Noninterest Income | Noninterest Expense, Noninterest Income | Noninterest Expense, Noninterest Income | Noninterest Expense, Noninterest Income |
Balance, end of period | $ 24,657 | $ 24,657 | ||
Interest rate floors | ||||
Reconciliation of significant unobservable inputs, assets: | ||||
Balance, beginning of period | 8,910 | 6,576 | ||
Subtractions | ||||
Changes in fair value | 214 | 2,548 | ||
Balance, end of period | 9,124 | 9,124 | ||
Derivative liabilities | Interest rate lock commitments | ||||
Reconciliation of significant unobservable inputs, liabilities: | ||||
Balance, beginning of period | 22 | $ 4 | 4 | $ 23 |
Change in fair value | $ 105 | $ 64 | $ 123 | $ 45 |
Fair Value, Liability, Recurring Basis, Still Held, Unrealized Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Noninterest Expense, Noninterest Income | Noninterest Expense, Noninterest Income | Noninterest Expense, Noninterest Income | Noninterest Expense, Noninterest Income |
Balance, end of period | $ 127 | $ 68 | $ 127 | $ 68 |
Assets | ||||
Reconciliation of significant unobservable inputs, assets: | ||||
Balance, beginning of period | 172,200 | 143,867 | 158,457 | 146,248 |
Additions | ||||
Originated servicing | 3,761 | 2,124 | 5,927 | 4,297 |
Subtractions | ||||
Paydowns | (2,252) | (2,073) | (4,639) | (3,771) |
Changes in fair value | 5,067 | 3,370 | 19,031 | 514 |
Balance, end of period | 178,776 | 147,288 | 178,776 | 147,288 |
Available for sale securities | ||||
Reconciliation of significant unobservable inputs, assets: | ||||
Balance, beginning of period | 472,192 | 485,500 | ||
Subtractions | ||||
Paydowns | (7,884) | (16,870) | ||
Changes in fair value | (1,681) | (6,003) | ||
Balance, end of period | 462,627 | 462,627 | ||
Derivative assets | Interest rate lock commitments | ||||
Reconciliation of significant unobservable inputs, assets: | ||||
Balance, beginning of period | 174 | 218 | 140 | 28 |
Subtractions | ||||
Gains (losses) included in other noninterest income | $ 4 | $ 124 | $ (30) | $ (66) |
Fair Value, Net Derivative Asset (Liability), Recurring Basis, Still Held, Unrealized Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Noninterest Expense, Noninterest Income | Noninterest Expense, Noninterest Income | Noninterest Expense, Noninterest Income | Noninterest Expense, Noninterest Income |
Balance, end of period | $ 170 | $ 94 | $ 170 | $ 94 |
Disclosures about Fair Value _5
Disclosures about Fair Value of Assets and Liabilities - Assets and Liabilities Measured at Fair Value on Nonrecurring Basis (Details) - Nonrecurring - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Disclosures about Fair Value of Assets and Liabilities | ||
Collateral-dependent loans | $ 29,732 | $ 47,026 |
Level 3 | ||
Disclosures about Fair Value of Assets and Liabilities | ||
Collateral-dependent loans | $ 29,732 | $ 47,026 |
Disclosures about Fair Value _6
Disclosures about Fair Value of Assets and Liabilities - Quantitative Information about Unobservable Inputs (Details) | Jun. 30, 2024 USD ($) | Dec. 31, 2023 USD ($) | |
Quantitative information about unobservable inputs | |||
Servicing rights | $ 178,776,000 | $ 158,457,000 | [1] |
Level 3 | Servicing rights | SBA | |||
Quantitative information about unobservable inputs | |||
Servicing rights | $ 4,962,000 | $ 5,280,000 | |
Level 3 | Servicing rights | SBA | Measurement Input, Discount Rate | |||
Quantitative information about unobservable inputs | |||
Servicing asset, measurement input | 0.16 | 0.16 | |
Level 3 | Servicing rights | SBA | Measurement Input, Discount Rate | Weighted Average | |||
Quantitative information about unobservable inputs | |||
Servicing asset, measurement input | 0.16 | 0.16 | |
Level 3 | Servicing rights | SBA | Measurement Input, Constant Prepayment Rate | Minimum | |||
Quantitative information about unobservable inputs | |||
Servicing asset, measurement input | 0.03 | 0.03 | |
Level 3 | Servicing rights | SBA | Measurement Input, Constant Prepayment Rate | Maximum | |||
Quantitative information about unobservable inputs | |||
Servicing asset, measurement input | 0.14 | 0.14 | |
Level 3 | Servicing rights | SBA | Measurement Input, Constant Prepayment Rate | Weighted Average | |||
Quantitative information about unobservable inputs | |||
Servicing asset, measurement input | 0.09 | 0.09 | |
Level 3 | Servicing rights | Single family | |||
Quantitative information about unobservable inputs | |||
Servicing rights | $ 32,654,000 | $ 30,959,000 | |
Level 3 | Servicing rights | Single family | Measurement Input, Discount Rate | Minimum | |||
Quantitative information about unobservable inputs | |||
Servicing asset, measurement input | 0.10 | 0.10 | |
Level 3 | Servicing rights | Single family | Measurement Input, Discount Rate | Maximum | |||
Quantitative information about unobservable inputs | |||
Servicing asset, measurement input | 0.11 | 0.11 | |
Level 3 | Servicing rights | Single family | Measurement Input, Discount Rate | Weighted Average | |||
Quantitative information about unobservable inputs | |||
Servicing asset, measurement input | 0.10 | 0.10 | |
Level 3 | Servicing rights | Single family | Measurement Input, Constant Prepayment Rate | Minimum | |||
Quantitative information about unobservable inputs | |||
Servicing asset, measurement input | 0.06 | 0.06 | |
Level 3 | Servicing rights | Single family | Measurement Input, Constant Prepayment Rate | Maximum | |||
Quantitative information about unobservable inputs | |||
Servicing asset, measurement input | 0.15 | 0.16 | |
Level 3 | Servicing rights | Single family | Measurement Input, Constant Prepayment Rate | Weighted Average | |||
Quantitative information about unobservable inputs | |||
Servicing asset, measurement input | 0.07 | 0.07 | |
Level 3 | Servicing rights | Multi-family | |||
Quantitative information about unobservable inputs | |||
Servicing rights | $ 141,160,000 | $ 122,218,000 | |
Level 3 | Servicing rights | Multi-family | Measurement Input, Discount Rate | Minimum | |||
Quantitative information about unobservable inputs | |||
Servicing asset, measurement input | 0.08 | 0.08 | |
Level 3 | Servicing rights | Multi-family | Measurement Input, Discount Rate | Maximum | |||
Quantitative information about unobservable inputs | |||
Servicing asset, measurement input | 0.13 | 0.13 | |
Level 3 | Servicing rights | Multi-family | Measurement Input, Discount Rate | Weighted Average | |||
Quantitative information about unobservable inputs | |||
Servicing asset, measurement input | 0.09 | 0.09 | |
Level 3 | Servicing rights | Multi-family | Measurement Input, Constant Prepayment Rate | Minimum | |||
Quantitative information about unobservable inputs | |||
Servicing asset, measurement input | 0 | 0 | |
Level 3 | Servicing rights | Multi-family | Measurement Input, Constant Prepayment Rate | Maximum | |||
Quantitative information about unobservable inputs | |||
Servicing asset, measurement input | 0.62 | 0.50 | |
Level 3 | Servicing rights | Multi-family | Measurement Input, Constant Prepayment Rate | Weighted Average | |||
Quantitative information about unobservable inputs | |||
Servicing asset, measurement input | 0.07 | 0.07 | |
Level 3 | Collateral-dependent impaired loans | |||
Quantitative information about unobservable inputs | |||
Collateral-dependent loans | $ 29,732,000 | $ 47,026,000 | |
Level 3 | Collateral-dependent impaired loans | Minimum | |||
Quantitative information about unobservable inputs | |||
Marketability discount (as a percent) | 0 | 0 | |
Level 3 | Collateral-dependent impaired loans | Maximum | |||
Quantitative information about unobservable inputs | |||
Marketability discount (as a percent) | 0.56 | 1 | |
Level 3 | Collateral-dependent impaired loans | Weighted Average | |||
Quantitative information about unobservable inputs | |||
Marketability discount (as a percent) | 0.04 | 0.02 | |
Level 3 | Available for sale securities | Measurement Input, Credit Spread | |||
Quantitative information about unobservable inputs | |||
Mortgage-backed - Non-agency residential- fair value option | $ 462,627,000 | $ 485,500,000 | |
Mortgage-backed - Non-agency residential- fair value option (as a percent) | 0.03 | 0.02 | |
Level 3 | Available for sale securities | Measurement Input, Credit Spread | Weighted Average | |||
Quantitative information about unobservable inputs | |||
Mortgage-backed - Non-agency residential- fair value option (as a percent) | 0.03 | 0.02 | |
Level 3 | Interest rate lock commitments | |||
Quantitative information about unobservable inputs | |||
Derivative assets | $ 170,000 | $ 140,000 | |
Derivative liabilities | $ 127,000 | $ 4,000 | |
Level 3 | Interest rate lock commitments | Measurement Input, Maturity | Minimum | |||
Quantitative information about unobservable inputs | |||
Derivative assets, (as a percent) | 0.57 | 0.45 | |
Derivative liabilities (as a percent) | 0.57 | 0.45 | |
Level 3 | Interest rate lock commitments | Measurement Input, Maturity | Maximum | |||
Quantitative information about unobservable inputs | |||
Derivative assets, (as a percent) | 0.99 | 0.99 | |
Derivative liabilities (as a percent) | 0.99 | 0.99 | |
Level 3 | Interest rate lock commitments | Measurement Input, Maturity | Weighted Average | |||
Quantitative information about unobservable inputs | |||
Derivative assets, (as a percent) | 0.83 | 0.78 | |
Derivative liabilities (as a percent) | 0.83 | 0.78 | |
Level 3 | Put option | Measurement Input, Credit Spread | |||
Quantitative information about unobservable inputs | |||
Derivative assets | $ 24,657,000 | $ 18,654,000 | |
Derivative assets, (as a percent) | 0.03 | 0.02 | |
Level 3 | Put option | Measurement Input, Credit Spread | Weighted Average | |||
Quantitative information about unobservable inputs | |||
Derivative assets, (as a percent) | 0.03 | 0.02 | |
Level 3 | Interest rate floors | Measurement Input, Discount Rate | |||
Quantitative information about unobservable inputs | |||
Derivative assets | $ 9,124,000 | $ 6,576,000 | |
Level 3 | Interest rate floors | Measurement Input, Discount Rate | Minimum | |||
Quantitative information about unobservable inputs | |||
Derivative assets, (as a percent) | 0.06 | 0.06 | |
Level 3 | Interest rate floors | Measurement Input, Discount Rate | Maximum | |||
Quantitative information about unobservable inputs | |||
Derivative assets, (as a percent) | 0.09 | 0.07 | |
Level 3 | Interest rate floors | Measurement Input, Discount Rate | Weighted Average | |||
Quantitative information about unobservable inputs | |||
Derivative assets, (as a percent) | 0.07 | 0.07 | |
[1] *Derived from audited consolidated financial statements |
Disclosures about Fair Value _7
Disclosures about Fair Value of Assets and Liabilities - Carrying Value and Estimated Fair Value (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Financial assets: | ||
Securities held to maturity | $ 1,291,960 | $ 1,203,535 |
Loans held for sale | 102,873 | 86,663 |
Carrying value per balance sheet | ||
Financial assets: | ||
Cash and cash equivalents | 540,882 | 584,422 |
Securities purchased under agreements to resell | 3,304 | 3,349 |
Securities held to maturity | 1,291,110 | 1,204,217 |
FHLB stock | 67,499 | 48,578 |
Loans held for sale | 3,380,203 | 3,058,093 |
Loans receivable, net | 10,933,189 | 10,127,801 |
Interest receivable | 90,360 | 91,346 |
Financial liabilities: | ||
Deposits | 14,917,067 | 14,061,460 |
Short-term subordinated debt | 68,514 | 64,922 |
FHLB advances | 974,008 | 771,392 |
Other borrowing | 7,934 | 7,934 |
Credit linked notes | 108,750 | 119,879 |
Interest payable | 59,226 | 43,423 |
Estimated fair value | ||
Financial assets: | ||
Cash and cash equivalents | 540,882 | 584,422 |
Securities purchased under agreements to resell | 3,304 | 3,349 |
Securities held to maturity | 1,291,960 | 1,203,535 |
FHLB stock | 67,499 | 48,578 |
Loans held for sale | 3,380,203 | 3,058,093 |
Loans receivable, net | 10,888,928 | 10,088,468 |
Interest receivable | 90,360 | 91,346 |
Financial liabilities: | ||
Deposits | 14,918,490 | 14,062,457 |
Short-term subordinated debt | 68,514 | 64,922 |
FHLB advances | 973,919 | 771,029 |
Other borrowing | 7,934 | 7,934 |
Credit linked notes | 108,748 | 119,878 |
Interest payable | 59,226 | 43,423 |
Level 1 | Estimated fair value | ||
Financial assets: | ||
Cash and cash equivalents | 540,882 | 584,422 |
Financial liabilities: | ||
Deposits | 8,051,468 | 8,894,058 |
Level 2 | Estimated fair value | ||
Financial assets: | ||
Securities purchased under agreements to resell | 3,304 | 3,349 |
Securities held to maturity | 603,235 | 484,288 |
FHLB stock | 67,499 | 48,578 |
Loans held for sale | 3,380,203 | 3,058,093 |
Interest receivable | 90,360 | 91,346 |
Financial liabilities: | ||
Deposits | 6,867,022 | 5,168,399 |
Short-term subordinated debt | 68,514 | 64,922 |
FHLB advances | 973,919 | 771,029 |
Other borrowing | 7,934 | 7,934 |
Credit linked notes | 108,748 | 119,878 |
Interest payable | 59,226 | 43,423 |
Level 3 | Estimated fair value | ||
Financial assets: | ||
Securities held to maturity | 688,725 | 719,247 |
Loans receivable, net | $ 10,888,928 | $ 10,088,468 |
Leases - Other (Details)
Leases - Other (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Leases | ||
Operating lease right-of-use assets | $ 7,992 | $ 10,060 |
Operating lease liabilities | $ 9,098 | $ 11,251 |
Maximum | ||
Leases | ||
Lease period | 7 years | |
Minimum | ||
Leases | ||
Lease period | 1 year |
Leases - Balance sheet, Income
Leases - Balance sheet, Income Statement and Cash Flow Detail Regarding Operating Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | |
Leases. | |||||
Operating lease right-of-of use asset (in other assets) | $ 7,992 | $ 7,992 | $ 10,060 | ||
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Other Assets and Receivables | Other Assets and Receivables | Other Assets and Receivables | ||
Operating lease liability (in other liabilities) | $ 9,098 | $ 9,098 | $ 11,251 | ||
Operating Lease, Liability, Statement of Financial Position [Extensible Enumeration] | Other Liabilities | Other Liabilities | Other Liabilities | ||
Weighted average remaining lease term (years) | 4 years 8 months 12 days | 4 years 8 months 12 days | 6 years | ||
Weighted average discount rate | 3.25% | 3.25% | 2.89% | ||
Lessee, Operating Lease, Liability, to be Paid, Fiscal Year Maturity [Abstract] | |||||
One year or less | $ 2,286 | $ 2,286 | $ 2,441 | ||
Year two | 2,101 | 2,101 | 2,064 | ||
Year three | 2,019 | 2,019 | 2,100 | ||
Year four | 1,731 | 1,731 | 2,046 | ||
Year five | 1,051 | 1,051 | 1,438 | ||
Thereafter | 623 | 623 | 2,128 | ||
Total future minimum lease payments | 9,811 | 9,811 | 12,217 | ||
Less: imputed interest | 713 | 713 | 966 | ||
Total | 9,098 | 9,098 | $ 11,251 | ||
Lease, Cost [Abstract] | |||||
Operating lease cost (in occupancy and equipment expense) | $ 765 | $ 666 | 1,369 | $ 1,249 | |
Operating cash flows from operating leases | $ 1,220 | $ 886 |
Deposits - Components (Details)
Deposits - Components (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 | |
Noninterest-bearing deposits | |||
Total noninterest-bearing deposits | $ 383,260 | $ 520,070 | [1] |
Interest-bearing deposits | |||
Demand deposits | 4,779,531 | 5,381,067 | |
Savings deposits | 2,888,677 | 2,992,921 | |
Certificates of deposit | 6,865,599 | 5,167,402 | |
Total interest-bearing deposits | 14,533,807 | 13,541,390 | [1] |
Total deposits | $ 14,917,067 | $ 14,061,460 | [1] |
[1] *Derived from audited consolidated financial statements |
Deposits - Maturities of deposi
Deposits - Maturities of deposits (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Deposits. | ||
Due within one year | $ 6,760,482 | |
Due in one year to two years | 91,157 | |
Due in two years to three years | 13,960 | |
Total time deposits | $ 6,865,599 | $ 5,167,402 |
Deposits - Brokered deposits (D
Deposits - Brokered deposits (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Deposits. | ||
Brokered certificates of deposit | $ 6,119,391 | $ 4,465,825 |
Brokered savings deposits | 948 | 589 |
Brokered deposit on demand accounts | 1,504,230 | |
Total brokered deposits | $ 6,120,339 | $ 5,970,644 |
Borrowings - Components (Detail
Borrowings - Components (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 | |
Borrowings | |||
Other borrowings | $ 7,934 | $ 7,934 | |
Borrowings | 1,159,206 | 964,127 | [1] |
Short-term subordinated debt | |||
Borrowings | |||
Borrowings | 68,514 | 64,922 | |
FHLB advances | |||
Borrowings | |||
Borrowings | 974,008 | 771,392 | |
Credit linked notes, net of debt discount | |||
Borrowings | |||
Borrowings | $ 108,750 | $ 119,879 | |
[1] *Derived from audited consolidated financial statements |
Borrowings - Other (Details)
Borrowings - Other (Details) - FHLB advances - USD ($) $ in Millions | 6 Months Ended | |
May 21, 2024 | Jun. 30, 2024 | |
Borrowings | ||
Outstanding balance | $ 500 | |
Basis spread on variable rate (as a percent) | 15% | |
FHLB advances interest rate | 5.48% | |
FHLB has an option to cancel the agreement | 60 days | |
Number of days prior notice required for cancellation of debt agreement. | 1 day |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Net Income | ||||
Net Income (Loss) | $ 76,393 | $ 65,302 | $ 163,447 | $ 120,257 |
Dividends on preferred stock | (7,757) | (8,668) | (16,424) | (17,335) |
Preferred stock redemption | (1,823) | (1,823) | ||
Net Income Available to Common Shareholders | $ 66,813 | $ 56,634 | $ 145,200 | $ 102,922 |
Weighted-Average Shares | ||||
Weighted average shares - Basic | 44,569,345 | 43,235,398 | 43,937,665 | 43,207,655 |
Effect of dilutive securities-restricted stock awards | 128,979 | 73,995 | 144,820 | 92,585 |
Weighted average shares - diluted | 44,698,324 | 43,309,393 | 44,082,485 | 43,300,240 |
Per Share Amount | ||||
Basic earnings per share | $ 1.50 | $ 1.31 | $ 3.30 | $ 2.38 |
Diluted earnings per share | $ 1.49 | $ 1.31 | $ 3.29 | $ 2.38 |
Common Stock (Details)
Common Stock (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | |
May 13, 2024 | Jun. 30, 2024 | |
Initial Public Offering of Common Stock | ||
Proceeds from issuance of common stock, net | $ 97,655 | |
Public offering | ||
Initial Public Offering of Common Stock | ||
Issuance of common stock, net of $5.5 million in offering expenses (in shares) | 2,400,000 | |
Public offering price (in dollars per share) | $ 43 | |
Gross proceeds from issuance of common stock | $ 103,200 | |
Offering expenses on issuance of stock | 5,500 | |
Proceeds from issuance of common stock, net | $ 97,700 |
Preferred Stock (Details)
Preferred Stock (Details) | 6 Months Ended | 12 Months Ended | ||||||||
May 13, 2024 USD ($) shares | Sep. 30, 2022 USD ($) shares | Sep. 27, 2022 USD ($) $ / shares shares | Mar. 23, 2021 USD ($) $ / shares shares | Aug. 19, 2019 USD ($) $ / shares shares | Apr. 12, 2019 USD ($) shares | Mar. 28, 2019 USD ($) $ / shares shares | Jun. 30, 2024 $ / shares | Dec. 31, 2023 $ / shares | Apr. 01, 2024 USD ($) $ / shares | |
Public offering | ||||||||||
Public Offering of Preferred Stock | ||||||||||
Issuance of stock (in shares) | shares | 2,400,000 | |||||||||
Offering costs | $ 5,500,000 | |||||||||
7% Series A Preferred Stock | ||||||||||
Public Offering of Preferred Stock | ||||||||||
Preferred stock, dividend rate (as a percent) | 7% | 7% | ||||||||
Preferred stock liquidation preference (in dollars per share) | $ / shares | $ 25 | $ 25 | ||||||||
7% Series A Preferred Stock | Public offering | ||||||||||
Public Offering of Preferred Stock | ||||||||||
Issuance of stock (in shares) | shares | 81,800 | 2,000,000 | ||||||||
Preferred stock, dividend rate (as a percent) | 7% | |||||||||
Preferred stock liquidation preference (in dollars per share) | $ / shares | $ 25 | $ 25 | ||||||||
Preferred stock liquidation preference value | $ 52,000,000 | |||||||||
Aggregate gross offering proceeds for the shares issued | $ 50,000,000 | |||||||||
Net proceeds | $ 2,000,000 | 48,300,000 | ||||||||
Offering costs | $ 1,700,000 | |||||||||
Underwriting discounts | $ 41,000 | |||||||||
6% Series B Preferred Stock | ||||||||||
Public Offering of Preferred Stock | ||||||||||
Preferred stock, dividend rate (as a percent) | 6% | 6% | ||||||||
Preferred stock liquidation preference (in dollars per share) | $ / shares | $ 1,000 | $ 1,000 | ||||||||
6% Series B Preferred Stock | Public offering | ||||||||||
Public Offering of Preferred Stock | ||||||||||
Issuance of stock (in shares) | shares | 5,000,000 | |||||||||
Depositary shares equivalent preferred stock interest per share | 0.025 | |||||||||
Preferred stock, dividend rate (as a percent) | 6% | |||||||||
Preferred stock liquidation preference (in dollars per share) | $ / shares | $ 1,000 | |||||||||
Depositary share, preferred stock liquidation preference (in dollars per share) | $ / shares | $ 25 | |||||||||
Aggregate gross offering proceeds for the shares issued | $ 125,000,000 | |||||||||
Net proceeds | 120,800,000 | |||||||||
Underwriting discounts | $ 4,200,000 | |||||||||
6% Series C Preferred Stock | ||||||||||
Public Offering of Preferred Stock | ||||||||||
Preferred stock, dividend rate (as a percent) | 6% | 6% | ||||||||
Preferred stock liquidation preference (in dollars per share) | $ / shares | $ 1,000 | $ 1,000 | ||||||||
6% Series C Preferred Stock | Public offering | ||||||||||
Public Offering of Preferred Stock | ||||||||||
Issuance of stock (in shares) | shares | 6,000,000 | |||||||||
Depositary shares equivalent preferred stock interest per share | 0.025 | |||||||||
Preferred stock, dividend rate (as a percent) | 6% | |||||||||
Preferred stock liquidation preference (in dollars per share) | $ / shares | $ 1,000 | |||||||||
Depositary share, preferred stock liquidation preference (in dollars per share) | $ / shares | $ 25 | |||||||||
Aggregate gross offering proceeds for the shares issued | $ 150,000,000 | |||||||||
Net proceeds | 144,900,000 | |||||||||
Underwriting discounts | $ 5,100,000 | |||||||||
8.25% Series D Preferred Stock | ||||||||||
Public Offering of Preferred Stock | ||||||||||
Preferred stock, dividend rate (as a percent) | 8.25% | 8.25% | ||||||||
Preferred stock liquidation preference (in dollars per share) | $ / shares | $ 1,000 | $ 1,000 | ||||||||
8.25% Series D Preferred Stock | Public offering | ||||||||||
Public Offering of Preferred Stock | ||||||||||
Issuance of stock (in shares) | shares | 5,200,000 | |||||||||
Depositary shares equivalent preferred stock interest per share | 0.025 | |||||||||
Preferred stock, dividend rate (as a percent) | 8.25% | |||||||||
Preferred stock liquidation preference (in dollars per share) | $ / shares | $ 1,000 | |||||||||
Depositary share, preferred stock liquidation preference (in dollars per share) | $ / shares | $ 25 | |||||||||
Aggregate gross offering proceeds for the shares issued | $ 130,000,000 | |||||||||
Net proceeds | 125,400,000 | |||||||||
Underwriting discounts | $ 4,600,000 | |||||||||
Series D Preferred Stock | Public offering | ||||||||||
Public Offering of Preferred Stock | ||||||||||
Issuance of stock (in shares) | shares | 500,000 | |||||||||
Net proceeds | $ 12,100,000 | |||||||||
Underwriting discounts | $ 400,000 |
Share-Based Payment Plans - Inc
Share-Based Payment Plans - Incentive Plan (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||
Nov. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Non executive directors | |||||
Plan disclosures | |||||
Value of shares available for issuance for compensation related to annual fees | $ 70,000 | ||||
Shares issued | 2,849 | 3,682 | 6,013 | 6,545 | |
2017 Plan | |||||
Plan disclosures | |||||
Shares issued | 0 | 0 | 85,212 | 84,335 |
Share-Based Payment Plans - ESO
Share-Based Payment Plans - ESOP (Details) - ESOP - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Employee Stock Ownership Plan | ||||
Expense recognized for the contribution to the plan | $ 0 | $ 0 | $ 573,000 | $ 519,000 |
Shares contributed to the plan | 23,414 | 33,293 |
Segment Information (Details)
Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | [1] | |
Segment Information | ||||||
Interest income | $ 328,273 | $ 258,069 | $ 642,446 | $ 469,363 | ||
Interest expense | 200,154 | 152,452 | 387,271 | 263,053 | ||
Net Interest Income | 128,119 | 105,617 | 255,175 | 206,310 | ||
Provision for credit losses | 9,965 | 22,603 | 14,691 | 29,470 | ||
Net Interest Income After Provision for Credit Losses | 118,154 | 83,014 | 240,484 | 176,840 | ||
Noninterest income | 31,351 | 29,882 | 72,225 | 44,146 | ||
Noninterest expense | 50,380 | 44,320 | 99,292 | 79,092 | ||
Income Before Income Taxes | 99,125 | 68,576 | 213,417 | 141,894 | ||
Income taxes | 22,732 | 3,274 | 49,970 | 21,637 | ||
Net Income | 76,393 | 65,302 | 163,447 | 120,257 | ||
Total assets | 18,212,422 | 15,874,872 | 18,212,422 | 15,874,872 | $ 16,952,516 | |
Other | ||||||
Segment Information | ||||||
Interest income | 3,189 | 1,148 | 6,427 | 2,292 | ||
Interest expense | (792) | (1,856) | (1,558) | (3,575) | ||
Net Interest Income | 3,981 | 3,004 | 7,985 | 5,867 | ||
Net Interest Income After Provision for Credit Losses | 3,981 | 3,004 | 7,985 | 5,867 | ||
Noninterest income | (3,572) | (2,555) | (6,911) | (4,732) | ||
Noninterest expense | 10,070 | 8,623 | 19,035 | 15,839 | ||
Income Before Income Taxes | (9,661) | (8,174) | (17,961) | (14,704) | ||
Income taxes | (2,369) | (988) | (4,499) | (2,559) | ||
Net Income | (7,292) | (7,186) | (13,462) | (12,145) | ||
Total assets | 272,584 | 241,764 | 272,584 | 241,764 | ||
Multi-family Mortgage Banking | Operating Segments | ||||||
Segment Information | ||||||
Interest income | 1,135 | 1,248 | 2,881 | 2,354 | ||
Interest expense | 20 | 13 | 40 | 13 | ||
Net Interest Income | 1,115 | 1,235 | 2,841 | 2,341 | ||
Net Interest Income After Provision for Credit Losses | 1,115 | 1,235 | 2,841 | 2,341 | ||
Noninterest income | 31,983 | 30,325 | 72,450 | 46,922 | ||
Noninterest expense | 20,651 | 19,962 | 40,222 | 34,593 | ||
Income Before Income Taxes | 12,447 | 11,598 | 35,069 | 14,670 | ||
Income taxes | 3,410 | 356 | 9,423 | 1,462 | ||
Net Income | 9,037 | 11,242 | 25,646 | 13,208 | ||
Total assets | 428,299 | 373,680 | 428,299 | 373,680 | ||
Mortgage Warehousing | Operating Segments | ||||||
Segment Information | ||||||
Interest income | 101,164 | 64,267 | 186,065 | 106,585 | ||
Interest expense | 68,184 | 42,984 | 124,324 | 70,778 | ||
Net Interest Income | 32,980 | 21,283 | 61,741 | 35,807 | ||
Provision for credit losses | 995 | 2,320 | 1,935 | 3,684 | ||
Net Interest Income After Provision for Credit Losses | 31,985 | 18,963 | 59,806 | 32,123 | ||
Noninterest income | 1,746 | 2,872 | 5,063 | 3,905 | ||
Noninterest expense | 4,674 | 3,617 | 9,472 | 6,372 | ||
Income Before Income Taxes | 29,057 | 18,218 | 55,397 | 29,656 | ||
Income taxes | 6,787 | (378) | 12,937 | 2,419 | ||
Net Income | 22,270 | 18,596 | 42,460 | 27,237 | ||
Total assets | 5,626,055 | 4,474,832 | 5,626,055 | 4,474,832 | ||
Banking | Operating Segments | ||||||
Segment Information | ||||||
Interest income | 222,785 | 191,406 | 447,073 | 358,132 | ||
Interest expense | 132,742 | 111,311 | 264,465 | 195,837 | ||
Net Interest Income | 90,043 | 80,095 | 182,608 | 162,295 | ||
Provision for credit losses | 8,970 | 20,283 | 12,756 | 25,786 | ||
Net Interest Income After Provision for Credit Losses | 81,073 | 59,812 | 169,852 | 136,509 | ||
Noninterest income | 1,194 | (760) | 1,623 | (1,949) | ||
Noninterest expense | 14,985 | 12,118 | 30,563 | 22,288 | ||
Income Before Income Taxes | 67,282 | 46,934 | 140,912 | 112,272 | ||
Income taxes | 14,904 | 4,284 | 32,109 | 20,315 | ||
Net Income | 52,378 | 42,650 | 108,803 | 91,957 | ||
Total assets | $ 11,885,484 | $ 10,784,596 | $ 11,885,484 | $ 10,784,596 | ||
[1] *Derived from audited consolidated financial statements |