10 unchanged sentences
The Corporation uses two complementary methods to measure and manage interest rate risk.
−Removed: They are simulation of net interest income and estimates of economic value of equity.
+Added: They are a simulation of net interest income and estimates of economic value of equity.
Using these measurements in tandem provides a reasonably comprehensive summary of the magnitude of the Corporation's interest rate risk, level of risk as time evolves, and exposure to changes in interest rates.
10 unchanged sentences
Actual results will differ from the model's simulated results due to timing, amount and frequency of interest rate changes as well as changes in market conditions and the application and timing of various management strategies.
+Added: The following table summarizes the expected impact of interest rate changes in rate-ramp scenarios over a 12-month period, that is, a gradual non-parallel shift, on net interest income as of December 31, 2024:
+Added: Rate Ramp (1)
+Added: Annual change
+Added: in net interest income % change in net interest income
+Added: +400 bp + $29.4 million +2.6%
+Added: +300 bp + $25.0 million +2.2%
+Added: +200 bp + $19.2 million +1.7%
+Added: +100 bp + $11.8 million +1.1%
+Added: –100 bp - $7.3 million -0.7%
+Added: –200 bp - $14.3 million -1.3%
+Added: –300 bp - $21.4 million -1.9%
+Added: –400 bp - $29.0 million -2.6%
+Added: (1) These results include the effect of implicit and explicit interest rate floors that limit further reduction in interest rates.
The following table summarizes the expected impact of abrupt interest rate changes, i.e.
22 unchanged sentences
The net result of these interest rate derivatives is that the customer pays a fixed rate of interest and the Corporation receives a floating rate.
−Removed: These interest rate derivatives are derivative financial instruments, and the gross fair values are recorded in other assets and liabilities on the consolidated balance sheets, with changes in fair value during the period recorded in other non-interest income on the consolidated statements of income.
+Added: These interest rate derivatives are derivative financial instruments, and the gross fair values are recorded in other assets and liabilities on the consolidated balance sheets.
Cash Flow Hedges
3 unchanged sentences
For derivatives designated and that qualify as cash flow hedges of interest rate risk, the unrealized gain or loss on the derivative is recorded in AOCI and subsequently reclassified into interest income or interest expense in the same period during which the hedged transaction affects earnings.
−Removed: Amounts reported in AOCI related to derivatives will be reclassified to interest income as interest payments are made on the Corporation's variable-rate liabilities.
+Added: Amounts reported in AOCI related to derivatives will be reclassified to interest income or interest expense as interest payments are made on the Corporation's loans or borrowings.
+Added: On October 10, 2024, the Corporation terminated interest rate derivatives designated as cash flow hedges with a combined notional amount of $250 million.
+Added: As the hedged transaction continues to be probable, the unrealized losses will be recorded in AOCI and will be recognized as an increase to interest expense when the previously forecasted hedged items affects earnings in future periods.
+Added: During the year ended December 31, 2024, $0.2 million of these unrealized losses have been reclassified as an increase to interest expense on borrowings, on the consolidated statements of income.
In January 2023, the Corporation terminated interest rate derivatives designated as cash flow hedges with a combined notional amount of $1.0 billion.
−Removed: As the hedged transaction continues to be probable, the unrealized losses that have been recorded in AOCI will be recognized as reduction to interest income when the previously forecasted hedged item affects earnings in future periods.
−Removed: During 2023, $22.1 million of these unrealized losses have been reclassified as a reduction of interest income on loans, including fees, on the consolidated statements of income.
+Added: As the hedged transaction continues to be probable, the unrealized losses that have been recorded in AOCI will be recognized as reduction to interest income, including fees, when the previously forecasted hedged item affects earnings in future periods.
+Added: During the years ended December 31, 2024 and 2023, $27.9 million and $22.1 million, respectively, of these unrealized losses have been reclassified as a reduction of interest income on loans, including fees, on the consolidated statements of income.
+Added: In the fourth quarter of 2024, the Corporation executed $900.0 million of receive fixed, pay floating interest rate derivatives that qualify as cash flow hedges of interest rate risk to manage the Corporation's exposure to interest rate movements.
The Corporation must maintain a sufficient level of liquid assets to meet the cash needs of its customers, who, as depositors, may want to withdraw funds or who, as borrowers, need credit availability.
8 unchanged sentences
Advances from the FHLB, when utilized, are secured by qualifying commercial real estate and residential mortgage loans, investments and other assets.
−Removed: As of December 31, 2023, the Corporation had aggregate federal funds lines borrowing capacity of $2.6 billion, with $0.2 billion of outstanding borrowings against that amount.
−Removed: As of December 31, 2023, the Corporation had $1.3 billion of
−Removed: collateralized borrowing capacity at the discount window and $1.9 billion of borrowing capacity at the Bank Term Funding Program facility with no amounts outstanding under these programs.
+Added: As of December 31, 2024, the Corporation had aggregate federal funds lines borrowing capacity of $2.6 billion with no amounts outstanding against that amount.
+Added: As of December 31, 2024, the Corporation had $3.1 billion of collateralized borrowing capacity at the FRB discount window with no amounts outstanding and had no borrowings drawn against the Bank Term Funding Program facility, which expired March 11, 2024.
A combination of commercial real estate loans, commercial loans, consumer loans and securities are pledged to the FRB of Philadelphia to provide access to FRB discount window borrowings.
9 unchanged sentences
The Corporation's operating activities during 2024 generated $416.6 million of cash, mainly due to net income of $288.7 million.
−Removed: Cash used in investing activities was $809.2 million, primarily due to $1.1 billion net increase in loans.
−Removed: Net cash provided by financing activities was $314.0 million, due largely to the increases in time and brokered deposits, partially offset by decreases in demand and savings deposits and other borrowings.
+Added: Cash provided in investing activities was $1.6 billion, primarily due to $1.0 billion of net cash received for acquisitions in the Republic First Transaction.
+Added: Net cash used by financing activities was $1.5 billion, due largely to $2.1 billion in repayment of borrowings.
The following table presents the expected maturities of government, state and municipal and corporate AFS investment securities, at estimated fair value, as of December 31, 2024 and the weighted average yields on such securities (calculated based on historical cost):
4 unchanged sentences
Available for sale (dollars in thousands)
−Removed: Government securities $ 42,161 2.40 % $ — — % $ — — % $ — — %
−Removed: Government-sponsored agency securities — — 1,010 3.10 — — — —
State and municipal (1)
20 unchanged sentences
The following table presents the contractual maturities of fixed rate loans and loan types subject to changes in interest rates as of December 31, 2024:
−Removed: Five Years More Than
−Removed: Five Years Total
+Added: or Less After One
+Added: Five Years After Five Through Fifteen Years After 15 Years Total
(dollars in thousands)
33 unchanged sentences
The Corporation's debt security investments consist primarily of U.S.
−Removed: government-sponsored agency issued residential mortgage-backed securities, commercial mortgage-backed securities and collateralized mortgage obligations;
−Removed: as well as, state and municipal securities and corporate debt securities.
−Removed: All of the Corporation's investments in residential mortgage-backed securities, commercial mortgage-backed securities and collateralized mortgage obligations have principal payments that are guaranteed by U.S.
+Added: government-sponsored agency issued mortgage-backed securities and collateralized mortgage obligations, state and municipal securities, and corporate debt securities.
+Added: All of the Corporation's investments in mortgage-backed securities and collateralized mortgage obligations have principal payments that are guaranteed by U.S.
government-sponsored agencies.
8 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.