Company: WTFCN
Filing Date: 2025-05-05
Form Type: 10-Q
Source: 0001015328-25-000130
Chunk: 50

Company: WINTRUST FINANCIAL CORP
Filing Date: 2025-05-05
Form: 10-Q
Item: Item 1
Chunk 50
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 that are designated as fair value hedges for the respective period:(In thousands)Derivatives in Fair Value Hedging RelationshipsLocation of (Loss)/Gain Recognized in Income on DerivativeThree Months EndedMarch 31, 2025Interest rate swapsInterest and fees on loans$(3)Interest income - investment securities— Non-Designated HedgesThe Company does not use derivatives for speculative purposes. Derivatives not designated as accounting hedges are used to manage the Company’s economic exposure to interest rate movements and other identified risks but do not meet the strict 

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hedge accounting requirements of ASC 815. Changes in the fair value of derivatives not designated in hedging relationships are recorded directly in earnings.Interest Rate Derivatives—Periodically, the Company may purchase interest rate cap derivatives designed to act as an economic hedge of the risk of the negative impact on its fixed-rate loan portfolios from rising interest rates. As of March 31, 2025, there were no interest rate caps outstanding that were designed to act as an economic hedge. Additionally, 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 March 31, 2025 and December 31, 2024, the Company had interest rate derivative transactions with an aggregate notional amount of approximately $13.1 billion and $13.3 billion, respectively, (all interest rate swaps and caps with customers and third parties) related to this program. At March 31, 2025 these interest rate derivatives had maturity dates ranging from April 2025 to January 2037.Mortgage Banking Derivatives—These derivatives include interest rate lock commitments provided to customers to