Company: WTFCN
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0001015328-25-000207
Chunk: 60

Company: WINTRUST FINANCIAL CORP
Filing Date: 2025-11-06
Form: 10-Q
Item: Item 1
Chunk 60
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 identified risks but do not meet the strict hedge accounting requirements of ASC 815. Changes in the fair value of derivatives not designated in hedging relationships are recorded directly in earnings.  The Company has interest rate derivatives, including swaps and option products, resulting from a service the Company provides to certain qualified borrowers. The Company’s banking subsidiaries execute certain derivative products (typically interest rate swaps) directly with qualified commercial borrowers to facilitate their respective risk management strategies. For example, these arrangements allow the Company’s commercial borrowers to effectively convert a variable rate loan to a fixed rate. In order to minimize the Company’s exposure on these transactions, the Company simultaneously executes offsetting derivatives with third parties. In most cases, the offsetting derivatives have mirror-image terms, which result in the positions’ changes in fair value substantially offsetting through earnings each period. However, to the extent that the derivatives are not a mirror-image and because of differences in counterparty credit risk, changes in fair value will not completely offset resulting in some earnings impact each period. Changes in the fair value of these derivatives are included in other non-interest income. At September 30, 2025 and December 31, 2024, the Company had interest rate derivative transactions with an aggregate notional amount of approximately $14.8 billion and $13.3 billion, respectively, (all interest rate swaps and caps with customers and third parties) related to this program. At September 30, 2025 these interest rate derivatives had maturity dates ranging from October 2025 to August 2037.Mortgage Banking Derivatives—These derivatives include interest rate lock commitments provided to customers to fund certain mortgage loans to be sold into the secondary market and forward commitments for the future delivery of such loans. It is the Company’s practice to enter into forward commitments for the future delivery of a portion of its residential mortgage loan production when interest rate lock commitments are entered into in order to economically hedge the effect of future changes in interest rates on its commitments to fund the loans as well as on its portfolio of mortgage loans held-for-sale. The Company’s mortgage banking derivatives have not been designated as being in hedge relationships. At September 30, 2025 and December 31, 2024, the Company had interest rate lock commitments with an aggregate notional amount of approximately $379.1 million and $120.7 million, and forward commitments to sell mortgage loans with an aggregate notional amount of approximately $495.5 million and $377.5 million, respectively. The fair values of these derivatives