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FAIR VALUE MEASURES
 6 Months Ended
Jun. 30, 2026
Fair Value Disclosures [Abstract]  
FAIR VALUE MEASURES
NOTE 7 – FAIR VALUE MEASURES

The fair value of an asset or liability is the current amount that would be exchanged between willing parties, other than in a forced liquidation. Fair value is best determined based upon quoted market prices. However, in many instances, there are no quoted market prices for the Company’s various assets and liabilities. In cases where quoted market prices are not available, fair value is based on discounted cash flows or other valuation techniques. These techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. Accordingly, the fair value estimates may not be realized in an immediate settlement of the asset or liability. The accounting standard for disclosures about the fair value measures excludes certain financial instruments and all nonfinancial instruments from its disclosure requirements. Accordingly, the aggregate fair value amounts presented may not necessarily represent the underlying fair value of the Company.

The Company's mortgage loans held for sale under the fair value option were $482.2 million and $623.2 million at June 30, 2026 and December 31, 2025, respectively.

The Company has elected to record mortgage loans held for sale at fair value in order to eliminate the complexities and inherent difficulties of achieving hedge accounting and to better align reported results with the underlying economic changes in value of the loans and related hedge instruments. This election impacts the timing and recognition of origination fees and costs, as well as servicing value, which are now recognized in earnings at the time of origination. Interest income on mortgage loans held for sale is recorded on an accrual basis in the consolidated statements of income and comprehensive income under the heading interest income – interest and fees on loans. The servicing value is included in the fair value of the interest rate lock commitments (“IRLCs”) with borrowers. The mark to market adjustments related to mortgage loans held for sale and the associated economic hedges are captured in mortgage banking activities.

Net gains of $2.7 million and $613,000 resulting from changes in the fair value of these mortgage loans were recorded in income during the three months ended June 30, 2026 and 2025, respectively. A net loss of $4.0 million and a net gain of $7.9 million resulting from changes in the fair value of these mortgage loans were recorded in income during the six months ended June 30, 2026 and 2025, respectively. Net losses of $7.7 million and $3.6 million resulting from changes in the fair value of the related derivative financial instruments used to hedge exposure to the market-related risks associated with these mortgage loans were recorded in income during the three months ended June 30, 2026 and 2025, respectively. Net gains of $2.2 million and net losses of $8.3 million resulting from changes in the fair value of the related derivative financial instruments used to hedge exposure to the market-related risks associated with these mortgage loans were recorded in income during the six months ended June 30, 2026 and 2025, respectively. The Company’s valuation of mortgage loans held for sale incorporates an assumption for credit risk; however, given the short-term period that the Company holds these loans, valuation adjustments attributable to instrument-specific credit risk is nominal.

The following table summarizes the difference between the fair value and the principal balance for mortgage loans held for sale measured at fair value as of June 30, 2026 and December 31, 2025:

(dollars in thousands) 
June 30, 2026December 31, 2025
Aggregate fair value of mortgage loans held for sale$482,220 $623,152 
Aggregate unpaid principal balance of mortgage loans held for sale475,079 611,984 
Past-due loans of 90 days or more583 996 
Nonaccrual loans583 996 
Unpaid principal balance of nonaccrual loans583 998 

The Company utilizes fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. Securities available-for-sale, loans held for sale under the fair value option and derivative financial instruments are recorded at fair value on a recurring basis. From time to time, the Company may be required to record at fair value other assets on a nonrecurring basis, such as collateral-dependent loans, loan servicing rights and OREO. Additionally, the Company is required to disclose, but not record, the fair value of other financial instruments.
The following table presents the fair value measurements of assets and liabilities measured at fair value on a recurring basis and the level within the fair value hierarchy in which the fair value measurements fall as of June 30, 2026 and December 31, 2025. There were no transfers between Level 1 and Level 2, nor any transfers in or out of Level 3 during the six months ended June 30, 2026 or the year ended December 31, 2025.

Recurring Basis
Fair Value Measurements
June 30, 2026
(dollars in thousands) 
Fair ValueLevel 1Level 2Level 3
Financial assets:
Debt securities available-for-sale:
U.S. Treasuries$583,447 $583,447 $— $— 
State, county and municipal securities17,463 — 17,463 — 
Corporate debt securities2,452 — 1,387 1,065 
SBA pool securities10,519 — 10,519 — 
Mortgage-backed securities1,846,742 — 1,846,742 — 
Loans held for sale482,220 — 482,220 — 
Derivative financial instruments7,309 — 7,309 — 
Mortgage banking derivative instruments3,253 — 3,253 — 
Total recurring assets at fair value$2,953,405 $583,447 $2,368,893 $1,065 
Financial liabilities:
Derivative financial instruments$7,442 $— $7,442 $— 
Risk participation agreement4 — 4 — 
Mortgage banking derivative instruments483 — 483 — 
Total recurring liabilities at fair value$7,929 $— $7,929 $— 

Recurring Basis
Fair Value Measurements
December 31, 2025
(dollars in thousands)Fair ValueLevel 1Level 2Level 3
Financial assets:
Debt securities available-for-sale:
U.S. Treasuries$660,625 $660,625 $— $— 
State, county and municipal securities19,061 — 19,061 — 
Corporate debt securities5,875 — 4,825 1,050 
SBA pool securities12,208 — 12,208 — 
Mortgage-backed securities1,509,404 — 1,509,404 — 
Loans held for sale623,152 — 623,152 — 
Derivative financial instruments7,401 — 7,401 — 
Mortgage banking derivative instruments3,365 — 3,365 — 
Total recurring assets at fair value$2,841,091 $660,625 $2,179,416 $1,050 
Financial liabilities:
Derivative financial instruments$7,642 $— $7,642 $— 
Risk participation agreement16 — 16 — 
Mortgage banking derivative instruments2,758 — 2,758 — 
Total recurring liabilities at fair value$10,416 $— $10,416 $— 

The following table presents the fair value measurements of assets measured at fair value on a non-recurring basis, as well as the general classification of such instruments pursuant to the valuation hierarchy as of June 30, 2026 and December 31, 2025.
These assets are not measured at fair value on an ongoing basis, though they are subject to fair value adjustments in certain circumstances, such as when there is evidence of impairment.

Nonrecurring Basis
Fair Value Measurements
(dollars in thousands)Fair ValueLevel 1Level 2Level 3
June 30, 2026
Collateral-dependent loans$35,726 $— $— $35,726 
Other real estate owned926 — — 926 
Total nonrecurring assets at fair value$36,652 $— $— $36,652 
December 31, 2025
Collateral-dependent loans$36,689 $— $— $36,689 
Other real estate owned201 — — 201 
Total nonrecurring assets at fair value$36,890 $— $— $36,890 

The inputs used to determine estimated fair value of collateral-dependent loans include market conditions, loan term, underlying collateral characteristics and discount rates. The inputs used to determine fair value of OREO include market conditions, estimated marketing period or holding period, underlying collateral characteristics and discount rates.

For the six months ended June 30, 2026 and the year ended December 31, 2025, there were no changes in the methods and significant assumptions used to estimate fair value.

The following table shows significant unobservable inputs used in the fair value measurement of Level 3 assets:

(dollars in thousands)Fair ValueValuation
Technique		Unobservable InputsRange of
Discounts		Weighted
Average
Discount
June 30, 2026
Recurring:
Debt securities available-for-sale$1,065 Discounted cash flowsProbability of Default9.5%9.5%
Loss Given Default48%48%
Nonrecurring:
Collateral-dependent loans$35,726 Third-party appraisals and discounted cash flowsCollateral discounts and
discount rates
18% - 78%
36%
Other real estate owned$926 Third-party appraisals and sales contractsCollateral discounts and estimated
costs to sell
15% - 18%
17%
December 31, 2025
Recurring:
Debt securities available-for-sale$1,050 Discounted cash flowsProbability of Default10.3%10.3%
Loss Given Default49%49%
Nonrecurring:
Collateral-dependent loans$36,689 Third-party appraisals and discounted cash flowsCollateral discounts and
discount rates
15% - 71%
35%
Other real estate owned$201 Third-party appraisals and sales contractsCollateral discounts and estimated
costs to sell
15%
15%
The carrying amount and estimated fair value of the Company’s financial instruments, not shown elsewhere in these financial statements, were as follows:
Fair Value Measurements
June 30, 2026
(dollars in thousands)Carrying
Amount		Level 1Level 2Level 3Total
Financial assets:
Cash and due from banks$237,431 $237,431 $— $— $237,431 
Interest-bearing deposits in banks959,682 959,682 — — 959,682 
Debt securities held-to-maturity208,155 — 192,993 — 192,993 
Loans, net21,782,626 — — 21,603,398 21,603,398 
Financial liabilities:
Deposits22,587,573 — 22,582,379 — 22,582,379 
Other borrowings1,250,049 342,000 906,218 — 1,248,218 
Subordinated deferrable interest debentures135,299 — 143,196 — 143,196 

Fair Value Measurements
December 31, 2025
(dollars in thousands)Carrying
Amount		Level 1Level 2Level 3Total
Financial assets:
Cash and due from banks$253,807 $253,807 $— $— $253,807 
Interest-bearing deposits in banks835,113 835,113 — — 835,113 
Debt securities held-to-maturity203,242 — 189,873 — 189,873 
Loans, net21,128,692 — — 20,957,101 20,957,101 
Financial liabilities:
Deposits22,375,995 — 22,370,800 — 22,370,800 
Other borrowings558,039 524,908 31,183 — 556,091 
Subordinated deferrable interest debentures134,302 — 142,340 — 142,340