Other Borrowings

3 Months Ended

Mar. 31, 2023

Debt Disclosure [Abstract]

Other Borrowings

10. Other Borrowings

The Company has a $5.0 million line of credit from an unrelated financial institution maturing on November 1, 2023, with an interest rate that adjusts daily based on the prime rate less 0.25%. This line of credit has covenants specific to capital and other financial ratios, which the Company was in compliance with at March 31, 2023 and December 31, 2022. As of March 31, 2023 and December 31, 2022, the Company did not have an outstanding balance on the line of credit.

On September 29, 2022, the Company borrowed $10.0 million from an unrelated financial institution at a fixed rate of 6.15%. This borrowing matures on September 1, 2027 and requires quarterly principal and interest payments. Early principal payments are allowed and the balance was $8.7 million and $9.0 million at March 31, 2023 and December 31, 2022, respectively.

The Company has overnight repurchase agreements with certain deposit customers whereby the Company uses investment securities as collateral for non-insured funds. These balances are accounted for as collateralized financing and included in other borrowings on the balance sheet.

Repurchase agreements are comprised of non-insured customer funds, totaling $20.1 million at March 31, 2023 and $29.4 million at December 31, 2022, which were secured by $30.8 million and $38.4 million of the Company’s investment portfolio at the same dates, respectively.

The following is a summary of the balances and collateral of the Company’s repurchase agreements:

	As of March 31, 2023
(dollars in thousands)	Overnight and						Greater
	Continuous		Up to 30 days		30-90 days		than 90 days		Total
Repurchase agreements:
U.S. federal treasury obligations	$	16,355	$	-	$	-	$	-	$	16,355
U.S. federal agency obligations		606		-		-		-		606
Agency mortgage-backed securities		3,122		-		-		-		3,122
Total	$	20,083	$	-	$	-	$	-	$	20,083

	As of December 31, 2022
(dollars in thousands)	Overnight and		Up to				Greater
	Continuous		30 days		30-90 days		than 90 days		Total
Repurchase agreements:
U.S. federal treasury obligations	$	25,973	$	-	$	-	$	-	$	25,973
U.S. federal agency obligations		1,236		-		-		-		1,236
Agency mortgage-backed securities		2,193		-		-		-		2,193
Total	$	29,402	$	-	$	-	$	-	$	29,402

The investment securities are held by a third party financial institution in the customer’s custodial account. The Company is required to maintain adequate collateral for each repurchase agreement. Changes in the fair value of the investment securities impact the amount of collateral required. If the Company were to default, the investment securities would be used to settle the repurchase agreement with the deposit customer.