BORROWINGS |
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Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
BORROWINGS |
NOTE 11 – BORROWINGS Federal funds purchased and retail repurchase agreements Federal funds purchased and retail repurchase agreements included the following at December 31, 2019 and 2018.
Securities sold under agreements to repurchase (retail repurchase agreements) consist of obligations of the Company to other parties. The obligations are secured by residential mortgage-backed securities held by the Company with a fair value of $40,412 and $51,701 at December 31, 2019 and December 31, 2018. The agreements are on a day-to-day basis and can be terminated on demand. The following table presents the borrowing usage and interest rate information for federal funds purchased and retail repurchase agreements at and for the years ended December 31, 2019 and 2018.
Federal Home Loan Bank advances Federal Home Loan Bank advances as of December 31, 2019 and 2018 were as follows.
At December 31, 2019 and 2018, the Company had $311,223 and $368,770 drawn against its line of credit at a weighted average rate of 1.79% and 2.65%.
At December 31, 2019 and 2018, the Company had undisbursed advance commitments (letters of credit) with the Federal Home Loan Bank of $38,500 and $31,451. These letters of credit were obtained in lieu of pledging securities to secure public fund deposits that are over the FDIC insurance limit. The advances, Mortgage Partnership Finance credit enhancement obligations and letters of credit were collateralized by certain qualifying loans totaling $811,394 and $951,196 at December 31, 2019 and 2018. Based on this collateral and the Company’s holdings of Federal Home Loan Bank stock, the Company was eligible to borrow an additional $448,278 and $534,627 at December 31, 2019 and 2018. Future principal repayments of the December 31, 2019 outstanding balances are as follows.
Bank stock loan On March 13, 2017, the Company entered into an agreement with an unaffiliated financial institution that provided for a maximum borrowing facility of $30,000, secured by the Company’s stock in Equity Bank. The borrowing facility was renewed on March 12, 2018, amended March 11, 2019 to provide a maximum borrowing facility of $40,000 and matures May 15, 2020. Each draw of funds on the facility will create a separate note that is repayable over a term of five years. Each note will bear interest at a variable interest rate equal to the prime rate published in the “Money Rates” section of The Wall Street Journal (or any generally recognized successor), floating daily. Accrued interest and principal payments will be due quarterly with one final payment of unpaid principal and interest due at the end of the five-year term of each separate note. The Company is also required to pay an unused commitment fee in an amount equal to 20 basis points per annum on the unused portion of the maximum borrowing facility. Bank stock loan advances as of December 31, 2019 and 2018 are listed below.
Future principal repayments of the December 31, 2019 outstanding balances are as follows.
The terms of the borrowing facility require the Company and Equity Bank to maintain minimum capital ratios and other covenants. The Company believes it is in compliance with the terms of the borrowing facility and has not been otherwise notified of noncompliance. |