v3.26.1
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables)
 6 Months Ended
Jun. 30, 2026
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Schedule of Derivative Assets at Fair Value
As of June 30, 2026 and December 31, 2025, the following amounts were recorded on the consolidated balance sheet related to cumulative basis adjustments for fair value hedges:
Amortized CostCumulative Amount of Fair Value Hedging Adjustment to Hedged Items
(amounts in thousands)June 30, 2026December 31, 2025June 30, 2026December 31, 2025
Deposits$1,586,085 $1,697,282 $(2,876)$20,232 
FHLB advances650,000 750,000 (837)5,068 
Fair Value of Derivative Financial Instruments
The following tables present the fair value of Customers’ derivative financial instruments as well as their presentation on the consolidated balance sheets as of June 30, 2026 and December 31, 2025:
June 30, 2026
Derivative AssetsDerivative Liabilities
(amounts in thousands)Balance Sheet LocationFair ValueBalance Sheet LocationFair Value
Derivatives not designated as hedging instruments:
Interest rate swaps, caps and collars (1)
Other assets$9,533 Other liabilities$14,376 
December 31, 2025
Derivative AssetsDerivative Liabilities
(amounts in thousands)Balance Sheet LocationFair ValueBalance Sheet LocationFair Value
Derivatives not designated as hedging instruments:
Interest rate swaps, caps and collars (1)
Other assets$11,325 Other liabilities$15,700 
(1)    Customers’ centrally cleared derivatives are legally settled through variation margin payments and these payments are reflected as a reduction of the related derivative asset or liability, including accrued interest, on the consolidated balance sheet.
Effect of Derivative Financial Instruments on Net Income and Comprehensive Income
The following table presents amounts included in the consolidated statements of income related to derivatives designated as fair value hedges and derivatives not designated as hedges for the three and six months ended June 30, 2026 and 2025:
Amount of Income (Loss) Recognized in Earnings
Three Months Ended June 30,Six Months Ended June 30,
(amounts in thousands)Income Statement Location2026202520262025
Derivatives designated as fair value hedges:
Recognized on interest rate swapsNet interest income$1,161 $(2,322)$2,790 $(4,290)
Recognized on hedged depositsNet interest income(846)1,563 (2,132)2,736 
Recognized on hedged FHLB advancesNet interest income(116)996 (365)1,890 
Total$199 $237 $293 $336 
Derivatives not designated as hedging instruments:
Interest rate swaps, caps and collars
Other non-interest income$603 $892 $619 $1,671 
Changes in Accumulated Other Comprehensive Income (Loss)
The following table presents the changes in accumulated other comprehensive income (loss) by component for the three and six months ended June 30, 2026 and 2025. Amounts in parentheses indicate reductions to AOCI:
Three Months Ended June 30, 2026
(amounts in thousands)
Unrealized Gains (Losses) on Available for Sale Securities (1)
Unrealized Gains (Losses) on Cash Flow Hedges (2)
Total
Balance at April 1$(52,858)$(1,799)$(54,657)
Unrealized gains (losses) arising during period, before tax1,360 (7,563)(6,203)
Income tax effect(360)2,004 1,644 
Other comprehensive income (loss) before reclassifications1,000 (5,559)(4,559)
Reclassification adjustments for (gains) losses included in net income, before tax(154)386 232 
Income tax effect41 (102)(61)
Amounts reclassified from accumulated other comprehensive income (loss) to net income
(113)284 171 
Amortization of unrealized loss on securities transferred from available for sale to held to maturity952 — 952 
Income tax effect(253)— (253)
Amortization of unrealized loss on securities transferred from available for sale to held to maturity699 — 699 
Net current-period other comprehensive income (loss)1,586 (5,275)(3,689)
Balance at June 30$(51,272)$(7,074)$(58,346)
Three Months Ended June 30, 2025
(amounts in thousands)
Unrealized Gains (Losses) on Available for Sale Securities (1)
Unrealized Gains (Losses) on Cash Flow Hedges (2)
Total
Balance at April 1$(67,641)$— $(67,641)
Unrealized gains (losses) arising during period, before tax(8,011)— (8,011)
Income tax effect2,119 — 2,119 
Other comprehensive income (loss) before reclassifications(5,892)— (5,892)
Reclassification adjustments for (gains) losses included in net income, before tax1,797 — 1,797 
Income tax effect(475)— (475)
Amounts reclassified from accumulated other comprehensive income (loss) to net income
1,322 — 1,322 
Amortization of unrealized loss on securities transferred from available for sale to held to maturity1,206 — 1,206 
Income tax effect(320)— (320)
Amortization of unrealized loss on securities transferred from available for sale to held to maturity886 — 886 
Net current-period other comprehensive income (loss)(3,684)— (3,684)
Balance at June 30$(71,325)$— $(71,325)
Six Months Ended June 30, 2026
(amounts in thousands)
Unrealized Gains (Losses) Available for Sale Securities (1)
Unrealized Gains (Losses) on Cash Flow Hedges (2)
Total
Balance at January 1
$(57,012)$2,962 $(54,050)
Unrealized gains (losses) arising during period, before tax6,480 (14,507)(8,027)
Income tax effect(1,716)3,844 2,128 
Other comprehensive income (loss) before reclassifications4,764 (10,663)(5,899)
Reclassification adjustments for (gains) losses included in net income, before tax(509)853 344 
Income tax effect135 (226)(91)
Amounts reclassified from accumulated other comprehensive income (loss) to net income
(374)627 253 
Amortization of unrealized loss on securities transferred from available for sale to held to maturity1,839 — 1,839 
Income tax effect(489)— (489)
Amortization of unrealized loss on securities transferred from available for sale to held to maturity1,350 — 1,350 
Net current-period other comprehensive income (loss)5,740 (10,036)(4,296)
Balance at June 30$(51,272)$(7,074)$(58,346)

Six Months Ended June 30, 2025
(amounts in thousands)
Unrealized Gains (Losses) on Available for Sale Securities (1)
Unrealized
Gains (Losses) on Cash Flow Hedges (2)
Total
Balance at January 1
$(96,560)$— $(96,560)
Unrealized gains (losses) arising during period, before tax(21,260)— (21,260)
Income tax effect5,603 — 5,603 
Other comprehensive income (loss) before reclassifications(15,657)— (15,657)
Reclassification adjustments for (gains) losses included in net income, before tax53,116 — 53,116 
Income tax effect(13,972)— (13,972)
Amounts reclassified from accumulated other comprehensive income (loss) to net income
39,144 — 39,144 
Amortization of unrealized loss on securities transferred from available for sale to held to maturity2,375 — 2,375 
Income tax effect(627)— (627)
Amortization of unrealized loss on securities transferred from available for sale to held to maturity1,748 — 1,748 
Net current-period other comprehensive income 25,235 — 25,235 
Balance at June 30$(71,325)$— $(71,325)
(1)    Reclassification amounts for AFS debt securities are reported as net gain (loss) on sale of investment securities or impairment loss on debt securities, and amortization of unrealized losses on debt securities transferred from available-for-sale to held-to-maturity is reported within interest income on the consolidated statements of income.
(2)    Reclassification amounts for cash flow hedges are reported as interest income for the applicable hedged items on the consolidated statements of income.
The following tables present the effect of Customers’ derivative financial instruments on comprehensive income for the three and six months ended June 30, 2026 and 2025:
Amount of Gain (Loss) Recognized in OCI on Derivatives (1)
Location of Gain (Loss) Reclassified from AOCI into Income 
Amount of Gain (Loss) Reclassified from AOCI into Income
Three Months Ended June 30,Three Months Ended June 30,
(amounts in thousands)2026202520262025
Derivatives in cash flow hedging relationships:
Interest rate swaps$(5,559)$— 
Interest income
$(386)$— 

Amount of Gain (Loss) Recognized in OCI on Derivatives (1)
Location of Gain (Loss) Reclassified from AOCI into Income Amount of Gain (Loss) Reclassified from AOCI into Income
Six Months Ended June 30,Six Months Ended June 30,
(amounts in thousands)2026202520262025
Derivatives in cash flow hedging relationships:
Interest rate swaps$(10,663)$— 
Interest income
$(853)$— 
(1)    Amounts presented are net of taxes. Refer to NOTE 4 – CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) for the total effect on other comprehensive income (loss) from derivatives designated as cash flow hedges for the periods presented.
Summary of Offsetting of Financial Assets and Derivative Assets
The following tables present derivative instruments that are subject to enforceable master netting arrangements. Customers’ interest rate swaps, caps and collars with institutional counterparties are subject to master netting arrangements and are included in the tables below. Interest rate swaps, caps and collars with commercial banking customers are not subject to master netting arrangements and are excluded from the tables below. Customers has not made a policy election to offset its derivative positions.
Gross Amounts Recognized on the Consolidated Balance SheetGross Amounts Not Offset in the Consolidated Balance SheetNet Amount
(amounts in thousands)Financial InstrumentsCash Collateral Received/Posted
June 30, 2026
Interest rate derivative assets with institutional counterparties$7,272 $(1,118)$(5,891)$263 
Interest rate derivative liabilities with institutional counterparties$2,490 $(1,118)$(1,372)$— 
Gross Amounts Recognized on the Consolidated Balance SheetGross Amounts Not Offset in the Consolidated Balance SheetNet Amount
(amounts in thousands)Financial InstrumentsCash Collateral Received/Posted
December 31, 2025
Interest rate derivative assets with institutional counterparties$6,294 $(5,219)$(1,075)$— 
Interest rate derivative liabilities with institutional counterparties$5,219 $(5,219)$— $— 
Summary of Offsetting of Financial Liabilities and Derivative Liabilities
The following tables present derivative instruments that are subject to enforceable master netting arrangements. Customers’ interest rate swaps, caps and collars with institutional counterparties are subject to master netting arrangements and are included in the tables below. Interest rate swaps, caps and collars with commercial banking customers are not subject to master netting arrangements and are excluded from the tables below. Customers has not made a policy election to offset its derivative positions.
Gross Amounts Recognized on the Consolidated Balance SheetGross Amounts Not Offset in the Consolidated Balance SheetNet Amount
(amounts in thousands)Financial InstrumentsCash Collateral Received/Posted
June 30, 2026
Interest rate derivative assets with institutional counterparties$7,272 $(1,118)$(5,891)$263 
Interest rate derivative liabilities with institutional counterparties$2,490 $(1,118)$(1,372)$— 
Gross Amounts Recognized on the Consolidated Balance SheetGross Amounts Not Offset in the Consolidated Balance SheetNet Amount
(amounts in thousands)Financial InstrumentsCash Collateral Received/Posted
December 31, 2025
Interest rate derivative assets with institutional counterparties$6,294 $(5,219)$(1,075)$— 
Interest rate derivative liabilities with institutional counterparties$5,219 $(5,219)$— $—