Company: SFNC
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0001628280-25-023690
Chunk: 224

Company: SIMMONS FIRST NATIONAL CORP
Filing Date: 2025-05-08
Form: 10-Q
Item: Part I, Item 8
Chunk 224
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 and market or liquidity risks. The fair value of these derivative instruments is recognized as either derivative assets or liabilities in the accompanying consolidated balance sheets. The Company has a limited number of swaps that are standalone without a similar agreement with the loan customer.The following table summarizes the fair values of loan derivative contracts recorded in the accompanying consolidated balance sheets.March 31, 2025December 31, 2024(In thousands)NotionalFair ValueNotionalFair ValueDerivative assets$921,587 $24,655 $748,752 $24,108 Derivative liabilities922,510 24,599 749,683 24,032 Risk Participation AgreementsThe Company has a limited number of Risk Participation Agreement swaps, that are associated with loan participations, where the Company is not the counterparty to the interest rate swaps that are associated with the risk participation sold. The interest rate swap mark to market only impacts the Company if the swap is in a liability position to the counterparty and the customer defaults on payments to the counterparty. The notional amount of these contingent agreements is $22.7 million as of March 31, 2025.Energy HedgingThe Company, from time-to-time, has provided energy derivative services to qualifying, high quality oil and gas borrowers for hedging purposes. The Company has served as an intermediary on energy derivative products between the Company’s borrowers and dealers. The Company will only enter into back-to-back trades, thus maintaining a balanced book between the dealer and the borrower. The energy hedging risk exposure to the Company’s customer would increase as energy prices for crude oil and natural gas rise. As prices decrease, exposure to the exchange would increase. These risks are mitigated by customer credit underwriting policies and establishing a predetermined hedge line for each borrower and by monitoring the exchange margin. The Company has no outstanding notional values related to energy hedge swap contracts as of March 31, 2025. Currently, the Company generally does not intend to offer hedging services to any remaining energy related customers.

45

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders, Board of Directors and Audit Committee

Simmons First National Corporation

Pine Bluff, Arkansas

Results of Review of Interim Financial Statements

We have reviewed the condensed consolidated balance sheet of Simmons First National Corporation (“the Company”) and subsidiaries as of March 31, 2025, and the related condensed consolidated statements of income, comprehensive income (loss), cash