Company: WBS-PG
Filing Date: 2025-08-11
Form Type: 10-Q
Source: 0000801337-25-000083
Chunk: 199

Company: WEBSTER FINANCIAL CORP
Filing Date: 2025-08-11
Form: 10-Q
Item: Part I, Item 2
Chunk 199
---
 equivalent to the dividends paid to holders of common stock. These unvested awards meet the definition of participating securities.Potential common shares from performance-based restricted stock that were not included in the computation of diluted earnings per common share because they were anti-dilutive under the treasury stock method were 147,168 and zero for the three and six months ended June 30, 2025, and respectively, and 80,115 and zero for the three and six months ended June 30, 2024, respectively. Additional information regarding stock awards under the Company’s stock incentive plan can be found within Note 20: Share-Based Plans in the Notes to Consolidated Financial Statements contained in Part II - Item 8. Financial Statements and Supplementary Data of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

69

Note 13: Derivative Financial Instruments

Derivative Positions and OffsettingDerivatives Designated in Hedge Relationships. Interest rate swaps allow the Company to change the fixed or variable nature of an interest rate without the exchange of the underlying notional amount. Certain pay fixed/receive variable interest rate swaps are designated as cash flow hedges to effectively convert variable-rate debt into fixed-rate debt, whereas certain receive fixed/pay variable interest rate swaps are designated as fair value hedges to effectively convert fixed-rate debt into variable-rate debt. Certain purchased options are also designated as cash flow hedges, allowing the Company to limit the potential adverse impact of variable interest rates by establishing a cap rate or floor rate in exchange for an upfront premium. The purchased options designated as cash flow hedges represent interest rate caps where payment is received from the counterparty if interest rates rise above the cap rate, and interest rate floors where payment is received from the counterparty when interest rates fall below the floor rate. The maximum length of time over which forecasted transactions are hedged is 2.4 years.Derivatives Not Designated in Hedge Relationships. The Company also enters into derivative transactions that are not designated in hedge relationships. The Company has a back-to-back swap program, whereby it enters into an interest rate swap with a qualified customer and simultaneously enters into an equal and opposite interest-rate swap with a swap counterparty, to hedge interest rate risk. Derivative assets and derivative liabilities with the same counterparty are presented on a net basis when master netting agreements are in place.The following tables present the notional amounts and fair values, including accrued interest, of derivative positions:June 30,