Company: BWFG
Filing Date: 2025-08-06
Form Type: 10-Q
Source: 0001505732-25-000126
Chunk: 60

Company: Bankwell Financial Group, Inc.
Filing Date: 2025-08-06
Form: 10-Q
Item: Part I, Item 1
Chunk 60
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 the selection of discount rates that may appropriately reflect market and credit risks. Changes in these judgments often have a material impact on the fair value estimates. In addition, since these estimates are as of a specific point in time they are susceptible to material near-term changes.

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Financial instruments measured at fair value on a recurring basisThe following table details the financial instruments carried at fair value on a recurring basis at June 30, 2025 and December 31, 2024, and indicates the fair value hierarchy of the valuation techniques utilized by the Company to determine the fair value. The Company had no transfers into or out of Levels 1, 2 or 3 during the six months ended June 30, 2025 and for the year ended December 31, 2024.Fair Value(In thousands)Level 1Level 2Level 3June 30, 2025:Marketable equity securities$2,188 $— $— Available for sale investment securities:U.S. Government and agency obligations64,223 26,486 — Corporate bonds— 13,221 — Derivative asset— 5,024 — Derivative liability— 3,411 — December 31, 2024:Marketable equity securities$2,118 $— $— Available for sale investment securities:U.S. Government and agency obligations63,557 28,025 — Corporate bonds— 15,846 — Derivative asset— 7,472 — Derivative liability— 4,472 — Marketable equity securities and available for sale investment securities: The fair value of the Company’s investment securities is estimated by using pricing models or quoted prices of securities with similar characteristics (i.e., matrix pricing) and is classified within Level 1 or Level 2 of the valuation hierarchy. The pricing is primarily sourced from third-party pricing services overseen by management.Derivative assets and liabilities: The Company’s derivative assets and liabilities consist of transactions as part of management’s strategy to manage interest rate risk. The valuation of the Company’s interest rate swaps is obtained from a third-party pricing service and is determined using a discounted cash flow analysis on the expected cash flows of each derivative. The pricing analysis is based on observable inputs for the contractual terms of the derivatives, including the period to maturity and interest rate curves. The Company has determined that the majority of the inputs used to value its interest rate derivatives fall within Level 2