NOTE 8 – OTHER BORROWINGS

There were no outstanding borrowings with the Federal Reserve Bank (the FRB) at September 30, 2012 or at December 31, 2011.

Assets pledged as collateral with the FRB were as follows:


	September 30, 2012		December 31, 2011
Commercial loans	$	5,122	$	6,559
Commercial real estate loans		16,379		21,007

	$	21,501	$	27,566

Based on the collateral pledged, CFBank was eligible to borrow up to $12,979 from the FRB at September 30, 2012. In April 2011, CFBank was notified by the FRB that, due to regulatory considerations, it was no longer eligible for borrowings under the FRB’s Primary Credit Program, but was only eligible to borrow under the FRB’s Secondary Credit Program. Under the FRB’s Primary Credit Program, CFBank had access to short-term funds at any time, for any reason based on the collateral pledged. Under the Secondary Credit Program, which involves a higher level of administration, each borrowing request must be individually underwritten and approved by the FRB, CFBank’s collateral is automatically reduced by 10% and the cost of borrowings is 50 basis points higher.

CFBank had a $1.0 million line of credit with a commercial bank at both September 30, 2012 and at December 31, 2011. There was no outstanding balance on this line of credit at September 30, 2012 or December 31, 2011. Interest on this line accrues daily and is variable based on the commercial bank’s cost of funds and current market returns.