v3.26.1
Fair Value Measurements
 3 Months Ended
Mar. 31, 2026
Fair Value Disclosures [Abstract]  
Fair Value Measurements [Text Block] Fair Value Measurements
Fair value is defined by applicable accounting guidance as the price to sell an asset or transfer a liability in an orderly transaction between market participants in the principal market for the given asset or liability at the measurement date based on market conditions at that date. An orderly transaction assumes exposure to the market for a customary period for marketing activities prior to the measurement date and not a forced liquidation or distressed sale. Certain assets and liabilities are recorded in the Company's financial statements at fair value. Some are recorded on a recurring basis and some on a non-recurring basis.

For some assets and liabilities, observable market transactions and market information might be available. For other assets and liabilities, observable market transactions and market information might not be available. A hierarchy for fair value has been established which categorizes into three levels the inputs to valuation techniques used to measure fair value. The three levels are as follows:

Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1) - Fair value is based on unadjusted quoted prices in active markets for identical assets or liabilities.

Significant Other Observable Inputs (Level 2) - Fair value is based on significant other observable inputs which are generally determined based on a single price for each financial instrument provided to us by an applicable third-party pricing service and is based on one or more of the following:

•Quoted prices for similar, but not identical, assets or liabilities in active markets;
•Quoted prices for identical or similar assets or liabilities in inactive markets;
•Inputs other than quoted prices that are observable, such as interest rate and yield curves, volatilities, prepayment speeds, loss severities, credit risks, and default rates;
•Other inputs derived from or corroborated by observable market inputs.

Significant Unobservable Inputs (Level 3) - Fair value is based upon model-based valuation techniques for which at least one significant assumption is not observable in the market.

Transfers between levels are recognized as of the end of the reporting period. There were no transfers in or out of quoted prices in active markets for identical instruments to significant other observable inputs or significant unobservable inputs during the three months ended March 31, 2026, and 2025, respectively. Transfers between significant other observable inputs and significant unobservable inputs during the three months ended March 31, 2026, and 2025 were immaterial.

The underlying methods used by the third-party pricing services are considered in determining the primary inputs used to determine fair values. Management has evaluated the methodologies employed by the third-party pricing services by comparing the price provided by the pricing service with other sources, including brokers' quotes, sales or purchases of similar instruments, and discounted cash flows to establish a basis for reliance on the pricing service values. Significant differences between the pricing service provided value and other sources are discussed with the pricing service to understand the basis for their values. Based on all observable inputs, management may adjust prices obtained from third-party pricing services to more appropriately reflect the prices that would be received to sell assets or paid to transfer liabilities in orderly transactions in the current market. No significant adjustments were made to prices provided by third-party pricing services at March 31, 2026, or December 31, 2025.
Assets and Liabilities Measured at Fair Value on a Recurring Basis

The fair value of financial assets and liabilities measured on a recurring basis was as follows as of March 31, 2026 (in thousands):
 TotalQuoted Prices in Active Markets for Identical Instruments (Level 1)Significant Other Observable Inputs (Level 2)Significant Unobservable Inputs
(Level 3)
Assets:    
Trading securities:
U.S. government securities$6,379 $— $6,379 $— 
Residential agency mortgage-backed securities5,513,068 — 5,513,068 — 
Municipal securities84,981 — 84,981 — 
Other trading securities47,734 — 47,734 — 
Total trading securities5,652,162 — 5,652,162 — 
Available-for-sale securities:
    
U.S. Treasury securities984 984 — — 
Municipal securities175,123 — 175,123 — 
Residential agency mortgage-backed securities9,631,722 — 9,631,722 — 
Residential non-agency mortgage-backed securities717,068 — 717,068 — 
Commercial agency mortgage-backed securities
3,014,195 — 3,014,195 — 
Other debt securities473 — — 473 
Total available-for-sale securities
13,539,565 984 13,538,108 473 
Fair value option securities:
Residential agency mortgage-backed securities165,706 — 165,706 — 
Commercial agency mortgage-backed securities12,392 — 12,392 — 
Total fair value option securities178,098 — 178,098 — 
Residential mortgage loans held for sale1
104,873 — 97,972 6,901 
Mortgage servicing rights, net2
333,381 — — 333,381 
Derivative contracts, net of cash margin3
782,985 1,474 781,511 — 
Liabilities: 
Derivative contracts, net of cash margin3
$282,590 $3,250 $279,340 $— 
1Residential mortgage loans held for sale measured at fair value on a recurring basis using significant unobservable inputs (Level 3) consist of residential mortgage loans intended for sale to U.S. government agencies that fail to meet conforming standards and are valued at 83.36% of the unpaid principal balance.
2A reconciliation of the beginning and ending fair value of mortgage servicing rights and disclosures of significant assumptions used to determine fair value are presented in Note 5, Mortgage Banking Activities.
3See Note 3 for detail of fair value of derivative contracts by contract type. Derivative contracts in asset and liability positions that were valued based on quoted prices in active markets for identical instruments (Level 1) are primarily exchange-traded interest rate derivative contracts held for trading and internal risk management purposes.
The fair value of financial assets and liabilities measured on a recurring basis was as follows as of December 31, 2025 (in thousands):
 TotalQuoted Prices in Active Markets for Identical Instruments (Level 1)Significant Other Observable Inputs (Level 2)Significant Unobservable Inputs
(Level 3)
Assets:    
Trading securities:
U.S. government securities$9,237 $— $9,237 $— 
Residential agency mortgage-backed securities5,307,849 — 5,307,849 — 
Municipal securities39,233 — 39,233 — 
Other trading securities36,426 — 36,426 — 
Total trading securities5,392,745 — 5,392,745 — 
Available-for-sale securities:
    
U.S. Treasury securities980 980 — — 
Municipal securities184,273 — 184,273 — 
Residential agency mortgage-backed securities9,598,627 — 9,598,627 — 
Residential non-agency mortgage-backed securities696,028 — 696,028 — 
Commercial agency mortgage-backed securities
3,126,244 — 3,126,244 — 
Other debt securities473 — — 473 
Total available-for-sale securities
13,606,625 980 13,605,172 473 
Fair value option securities — Residential agency mortgage-backed securities102,096 — 102,096 — 
Residential mortgage loans held for sale1
94,630 — 88,335 6,295 
Mortgage servicing rights, net2
322,724 — — 322,724 
Derivative contracts, net of cash margin3
300,775 1,022 299,753 — 
Liabilities:
Derivative contracts, net of cash margin3
$397,573 $12 $397,561 $— 
1Residential mortgage loans held for sale measured at fair value on a recurring basis using significant unobservable inputs (Level 3) consist of residential mortgage loans intended for sale to U.S. government agencies that fail to meet conforming standards and are valued at 82.84% of the unpaid principal balance.
2A reconciliation of the beginning and ending fair value of mortgage servicing rights and disclosures of significant assumptions used to determine fair value are presented in Note 5, Mortgage Banking Activities.
3See Note 3 for detail of fair value of derivative contracts by contract type. Derivative contracts in asset and liability positions that were valued based on quoted prices in active markets for identical instruments (Level 1) are primarily exchange-traded interest rate derivative contracts held for trading and internal risk management purposes.
Following is a description of the Company's valuation methodologies used for assets and liabilities measured on a recurring basis:
Securities

The fair values of trading, AFS, and fair value option securities are based on quoted prices for identical instruments in active markets, when available. If quoted prices for identical instruments are not available, fair values are based on significant other observable inputs such as quoted prices of comparable instruments or interest rates and credit spreads, yield curves, volatilities, prepayment speeds, and loss severities. The Company has elected to carry all residential mortgage-backed securities guaranteed by U.S. government agencies held as economic hedges against changes in the fair value of MSR at fair value with changes in the fair value recognized in earnings.

The fair value of certain AFS and held-to-maturity municipal and other debt securities may be based on significant unobservable inputs. These significant unobservable inputs include limited observed trades, projected cash flows, current credit rating of the issuers and, when applicable, the insurers of the debt and observed trades of similar debt. Discount rates are primarily based on reference to interest rate spreads on comparable securities of similar duration and credit rating as determined by the nationally-recognized rating agencies adjusted for a lack of trading volume. Significant unobservable inputs are developed by investment securities professionals involved in the active trading of similar securities. A summary of significant inputs used to value these securities follows. A management committee composed of senior members from the Company's Corporate Treasury, Risk Management, and Finance departments assesses the appropriateness of these inputs quarterly.

Derivatives

All derivative instruments are carried on the balance sheet at fair value. Fair values for exchange-traded contracts are based on quoted prices. Fair values for over-the-counter interest rate, commodity, and foreign exchange contracts are based on valuations provided either by third-party dealers in the contracts, quotes provided by independent pricing services, or a third-party provided pricing model that uses significant other observable market inputs.

Credit risk is considered in determining the fair value of derivative instruments. Management determines fair value adjustments based on various risk factors including, but not limited to, current fair value, probability of default, and loss given default.

We also consider our own credit risk in determining the fair value of derivative contracts. Changes in our credit rating would affect the fair value of our derivative liabilities. In the event of a credit downgrade, the fair value of our derivative liabilities Could increase.

Residential Mortgage Loans Held for Sale

Residential mortgage loans held for sale are carried on the balance sheet at fair value. The Company has elected to carry all residential mortgage loans originated for sale at fair value. Changes in the fair value of these financial instruments are recognized in earnings. The fair values of RMHFS are based upon quoted market prices of such loans sold in securitization transactions, including related unfunded loan commitments and forward sales contracts. The fair value of mortgage loans that were unable to be sold to U.S. government agencies were determined using quoted prices of loans that are sold in securitization transactions with a liquidity discount applied.
Fair Value of Assets and Liabilities Measured on a Non-Recurring Basis

Assets measured at fair value on a non-recurring basis include collateral for certain nonaccruing loans and real property and other assets acquired to satisfy loans, which are based primarily on comparisons to completed sales of similar assets.

There were no non-recurring fair value adjustments during the three months ended March 31, 2026 for which there was a carrying value at March 31, 2026.
The following represents the carrying value of assets measured at fair value on a non-recurring basis (and related losses) during the period. The carrying value represents only those assets with a balance at March 31, 2025, for which the fair value was adjusted during the three months ended March 31, 2025 (in thousands):
Fair Value Adjustments for the
 Carrying Value at March 31, 2025
Three Months Ended
Mar. 31, 2025
Recognized in:
 Quoted Prices
in Active Markets for Identical Instruments		Significant
Other
Observable
Inputs		Significant
Unobservable
Inputs		Gross charge-offs against allowance for loan lossesOther gains (losses), net
Real estate and other repossessed assets
$— $— $1,582 $— $(356)

The fair value of collateral-dependent nonaccruing loans secured by real estate and real estate and other repossessed assets and the related fair value adjustments are generally based on unadjusted third-party appraisals. Our appraisal review policies require appraised values to be supported by observed inputs derived principally from or corroborated by observable market data. Appraisals that are not based on observable inputs or that require significant adjustments or fair value measurements that are not based on third-party appraisals are considered to be based on significant unobservable inputs. Non-recurring fair value measurements of collateral-dependent nonaccruing loans and real estate and other repossessed assets based on significant unobservable inputs are generally due to estimates of current fair values between appraisal dates. Significant unobservable inputs include listing prices for the same or comparable assets, uncorroborated expert opinions, or management's knowledge of the collateral or industry. Non-recurring fair value measurements of collateral dependent loans secured by mineral rights are generally determined by our internal staff of engineers based on projected cash flows under current market conditions and are based on significant unobservable inputs. Projected cash flows are discounted according to risk characteristics of the underlying oil and gas properties. Assets are evaluated to demonstrate with reasonable certainty that crude oil, natural gas, and natural gas liquids can be recovered from known oil and gas reservoirs under existing economic and operating conditions at current prices with existing conventional equipment, operating methods, and costs. Significant unobservable inputs are developed by asset management and workout professionals and approved by senior Credit Administration executives.
A summary of quantitative information about Non-recurring Fair Value Measurements based on Significant Unobservable Inputs (Level 3) as of March 31, 2025 follows (dollars in thousands):

Fair ValueValuation Technique(s)Unobservable InputRange
(Weighted Average)
Real estate and other repossessed assets$1,582 Discounted cash flows
Marketability adjustments off appraised value1
82% - 82% (82%)
1    Marketability adjustments include consideration of estimated costs to sell which is approximately 10% of the fair value.
Fair Value of Financial Instruments

The following table presents the carrying values and estimated fair values of all financial instruments, including those financial assets and liabilities that are not measured and reported at fair value on a recurring basis or are measured at fair value on a non-recurring basis as of March 31, 2026 (in thousands):
Carrying
Value		Estimated
Fair
Value		Quoted Prices in Active Markets for Identical Instruments (Level 1)Significant Other Observable Inputs
(Level 2)		Significant Unobservable Inputs
(Level 3)
Cash and due from banks$905,614 $905,614 $905,614 $— $— 
Interest-bearing cash and cash equivalents506,793 506,793 506,793 — — 
Trading securities:
U.S. government securities6,379 6,379 — 6,379 — 
Residential agency mortgage-backed securities5,513,068 5,513,068 — 5,513,068 — 
Municipal securities84,981 84,981 — 84,981 — 
Other trading securities47,734 47,734 — 47,734 — 
Total trading securities5,652,162 5,652,162 — 5,652,162 — 
Investment securities:  
Municipal securities73,334 74,429 — 11,160 63,269 
Residential agency mortgage-backed securities1,613,987 1,479,984 — 1,479,984 — 
Commercial agency mortgage-backed securities16,588 16,190 — 16,190 — 
Other debt securities16,013 15,287 — 15,287 — 
Total investment securities1,719,922 1,585,890 — 1,522,621 63,269 
Allowance for credit losses(191)— — — — 
Investment securities, net of allowance1,719,731 1,585,890 — 1,522,621 63,269 
Available-for-sale securities:
  
U.S. Treasury securities984 984 984 — — 
Municipal securities175,123 175,123 — 175,123 — 
Residential agency mortgage-backed securities9,631,722 9,631,722 — 9,631,722 — 
Residential non-agency mortgage-backed securities717,068 717,068 — 717,068 — 
Commercial agency mortgage-backed securities
3,014,195 3,014,195 — 3,014,195 — 
Other debt securities473 473 — — 473 
Total available-for-sale securities
13,539,565 13,539,565 984 13,538,108 473 
Fair value option securities:
Residential agency mortgage-backed securities165,706 165,706 — 165,706 — 
Commercial agency mortgage-backed securities12,392 12,392 — 12,392 — 
Total fair value option securities178,098 178,098 — 178,098 — 
Residential mortgage loans held for sale104,873 104,873 — 97,972 6,901 
Loans:  
Commercial15,573,083 15,464,708 — — 15,464,708 
Commercial real estate5,884,679 5,795,154 — — 5,795,154 
Loans to individuals4,729,631 4,620,105 — — 4,620,105 
Total loans26,187,393 25,879,967 — — 25,879,967 
Allowance for loan losses(277,719)— — — — 
Loans, net of allowance25,909,674 25,879,967 — — 25,879,967 
Mortgage servicing rights333,381 333,381 — — 333,381 
Derivative instruments with positive fair value, net of cash margin782,985 782,985 1,474 781,511 — 
Deposits with no stated maturity34,950,239 34,950,239 — — 34,950,239 
Time deposits3,726,809 3,712,780 — — 3,712,780 
Other borrowed funds6,468,973 6,469,023 — — 6,469,023 
Subordinated debentures396,625 394,933 — 394,933 — 
Derivative instruments with negative fair value, net of cash margin282,590 282,590 3,250 279,340 — 
The following table presents the carrying values and estimated fair values of all financial instruments, including those financial assets and liabilities that are not measured and reported at fair value on a recurring basis or are measured at fair value on a non-recurring basis as of December 31, 2025 (in thousands):
Carrying
Value		Estimated
Fair
Value		Quoted Prices in Active Markets for Identical Instruments (Level 1)Significant Other Observable Inputs
(Level 2)		Significant Unobservable Inputs
(Level 3)
Cash and due from banks$1,001,107 $1,001,107 $1,001,107 $— $— 
Interest-bearing cash and cash equivalents656,995 656,995 656,995 — — 
Trading securities:
U.S. government securities9,237 9,237 — 9,237 — 
Residential agency mortgage-backed securities5,307,849 5,307,849 — 5,307,849 — 
Municipal securities39,233 39,233 — 39,233 — 
Other trading securities36,426 36,426 — 36,426 — 
Total trading securities5,392,745 5,392,745 — 5,392,745 — 
Investment securities:  
Municipal securities88,215 89,343 — 11,204 78,139 
Residential agency mortgage-backed securities1,664,175 1,541,608 — 1,541,608 — 
Commercial agency mortgage-backed securities16,516 16,186 — 16,186 — 
Other debt securities15,538 14,868 — 14,868 — 
Total investment securities1,784,444 1,662,005 — 1,583,866 78,139 
Allowance for credit losses(202)— — — — 
Investment securities, net of allowance1,784,242 1,662,005 — 1,583,866 78,139 
Available-for-sale securities:
  
U.S. Treasury securities980 980 980 — — 
Municipal securities184,273 184,273 — 184,273 — 
Residential agency mortgage-backed securities9,598,627 9,598,627 — 9,598,627 — 
Residential non-agency mortgage-backed securities696,028 696,028 — 696,028 — 
Commercial agency mortgage-backed securities
3,126,244 3,126,244 — 3,126,244 — 
Other debt securities473 473 — — 473 
Total available-for-sale securities
13,606,625 13,606,625 980 13,605,172 473 
Fair value option securities — Residential agency mortgage-backed securities102,096 102,096 — 102,096 — 
Residential mortgage loans held for sale94,630 94,630 — 88,335 6,295 
Loans:  
Commercial15,281,067 15,223,531 — — 15,223,531 
Commercial real estate5,672,006 5,597,767 — — 5,597,767 
Loans to individuals4,698,389 4,565,165 — — 4,565,165 
Total loans25,651,462 25,386,463 — — 25,386,463 
Allowance for loan losses(275,860)— — — — 
Loans, net of allowance25,375,602 25,386,463 — — 25,386,463 
Mortgage servicing rights322,724 322,724 — — 322,724 
Derivative instruments with positive fair value, net of cash margin300,775 300,775 1,022 299,753 — 
Deposits with no stated maturity35,795,923 35,795,923 — — 35,795,923 
Time deposits3,639,083 3,629,060 — — 3,629,060 
Other borrowed funds4,237,655 4,237,752 — — 4,237,752 
Subordinated debentures396,589 395,323 — 395,323 — 
Derivative instruments with negative fair value, net of cash margin397,573 397,573 12 397,561 — 

Because no market exists for certain of these financial instruments and management does not intend to sell these financial instruments, the fair values shown in the tables above may not represent values at which the respective financial instruments could be sold individually or in the aggregate at the given reporting date.