Company: BWFG
Filing Date: 2025-05-07
Form Type: 10-Q
Source: 0001505732-25-000089
Chunk: 50

Company: Bankwell Financial Group, Inc.
Filing Date: 2025-05-07
Form: 10-Q
Item: Part I, Item 1
Chunk 50
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 the derivative hedging instrument with the changes in cash flows of the designated hedged item or transaction. The Company does not offset derivative assets and derivative liabilities for financial statement presentation purposes.The Company assesses the effectiveness of the fair value swap hedge with a regression analysis that compares the changes in forward curves to determine the value. The effective portion of changes in the fair value of derivatives designated as fair value hedges is recorded through interest income. The Company does not offset derivative assets and derivative liabilities for financial statement presentation purposes.Changes in the consolidated statements of comprehensive income (loss) related to interest rate derivatives designated as hedges of cash flows were as follows for the three months ended March 31, 2025 and March 31, 2024:Three Months Ended March 31,(In thousands)20252024Interest rate swaps designated as cash flow hedges:Unrealized (loss) gain recognized in accumulated other comprehensive income before reclassifications$(522)$1,382 Amounts reclassified from accumulated other comprehensive (loss) income(612)(1,257)Income tax benefit (expense) on items recognized in accumulated other comprehensive income268 (64)Other comprehensive (loss) income$(866)$61 

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The above unrealized gains and losses are reflective of market interest rates as of the respective balance sheet dates. Generally, a lower interest rate environment will result in a negative impact to comprehensive income whereas a higher interest rate environment will result in a positive impact to comprehensive income.The following table summarizes the effect of the fair value hedging relationship recognized in the consolidated statements of income for the three months ended March 31, 2025 and March 31, 2024:Three Months Ended             March 31,(In thousands)20252024Gain (loss) on fair value hedging relationship:Hedged asset$142 $(1,668)Fair value derivative designated as hedging instrument(98)840 Total gain (loss) recognized in the consolidated statements of income within interest and fees on loans$44 $(828)The following tables summarize gross and net information about derivative instruments that are offset in the Consolidated Balance Sheets at March 31, 2025 and December 31, 2024:March 31, 2025(In thousands)Gross Amounts Not Offset in the Consolidated Balance SheetsGross Amounts of Recognized Assets(1)Gross Amounts Offset in the Statement of Financial PositionNet Amounts of Assets presented in the Statement of Financial PositionFinancial InstrumentsCash Collateral