(22) Disclosure of Financial Instruments Not Reported at Fair Value

 

GAAP requires disclosure of the fair value of financial assets and liabilities, including those financial assets and financial liabilities that are not measured and reported at fair value on a recurring basis or nonrecurring basis. The estimated fair values of Bancorp’s financial instruments not measured at fair value on a recurring or non-recurring basis follows:

 

   

Carrying

           

Fair Value Measurements Using:

 

December 31, 2025 (in thousands)

 

amount

   

Fair value

   

Level 1

   

Level 2

   

Level 3

 
                                         

Assets

                                       

Cash and cash equivalents

  $ 886,376     $ 886,376     $ 886,376     $     $  

HTM debt securities

    198,946       181,203       1,982       179,221        

Federal Home Loan Bank stock

    20,717       20,717             20,717        

Loans, net

    6,949,443       6,872,537                   6,872,537  

Accrued interest receivable

    28,783       28,783       28,783              
                                         

Liabilities

                                       

Non-interest bearing deposits

  $ 1,435,846     $ 1,435,846     $ 1,435,846     $     $  

Transaction deposits

    4,618,757       4,618,757             4,618,757        

Time deposits

    1,736,534       1,740,161             1,740,161        

Securities sold under agreement to repurchase

    112,476       112,476             112,476        

Federal funds purchased

    7,289       7,289             7,289        

Subordinated debentures

    26,806       26,547             26,547        

FHLB advances

    300,000       297,101             297,101        

Accrued interest payable

    1,740       1,740       1,740              

 

   

Carrying

           

Fair Value Measurements Using:

 

December 31, 2024 (in thousands)

 

Amount

   

Fair Value

   

Level 1

   

Level 2

   

Level 3

 
                                         

Assets

                                       

Cash and cash equivalents

  $ 291,020     $ 291,020     $ 291,020     $     $  

HTM debt securities

    370,171       341,357       153,108       188,249        

Federal Home Loan Bank stock

    21,603       21,603             21,603        

Loans, net

    6,433,459       6,256,752                   6,256,752  

Accrued interest receivable

    27,697       27,697       27,697              
                                         

Liabilities

                                       

Non-interest bearing deposits

  $ 1,456,138     $ 1,456,138     $ 1,456,138     $     $  

Transaction deposits

    4,472,475       4,472,475             4,472,475        

Time deposits

    1,237,788       1,236,463             1,236,463        

Securities sold under agreement to repurchase

    162,967       162,967             162,967        

Federal funds purchased

    6,525       6,525             6,525        

Subordinated debentures

    26,806       26,346             26,346        

FHLB advances

    300,000       294,848             294,848        

Accrued interest payable

    1,912       1,912       1,912              

 

Fair value estimates are made at a specific point in time based on relevant market information and information about financial instruments. Because no market exists for a significant portion of Bancorp’s financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments and other factors. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Therefore, calculated fair value estimates in many instances cannot be substantiated by comparison to independent markets and, in many cases, may not be realizable in a current sale of the instrument. Changes in assumptions could significantly impact estimates.

 

Historical Timeline

Fiscal YearFiled
2025Feb 26, 2026Showing above
2024Feb 27, 2025
2023Feb 27, 2024
2022Feb 24, 2023
2021Feb 25, 2022
2020Feb 26, 2021
2019Feb 28, 2020
2018Feb 28, 2019
2017Mar 13, 2018
2016Mar 13, 2017
2015Mar 4, 2016

About Fair Value Disclosures

Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.

Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.