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Long-Term Debt and FHLB Stock
9 Months Ended
Sep. 30, 2023
Long-Term Debt and FHLB Stock  
Long-Term Debt and FHLB Stock

6.    Long-Term Debt and FHLB Stock

FHLB Borrowings and Stock

The Bank is a member of the FHLB. At September 30, 2023 and December 31, 2022, the Bank had access to a preapproved secured line of credit with the FHLB of $657,633 and $667,905, respectively. Borrowings under this line require collateralization through the pledge of specific loans and securities. At September 30, 2023 and December 31, 2022, the Bank had pledged assets of $208,911 and $195,455, respectively. The Company had no outstanding overnight line of credit balances with the FHLB at either September 30, 2023 or December 31, 2022. These borrowings would mature the following business day.

The outstanding principal amounts and the related terms and rates at September 30, 2023 were as follows:

Term

    

Principal

    

Maturity

    

Rate

    

Due in one year

    

Long term

Fixed short-term

$

10,000

October 23, 2023

5.23

%  

$

10,000

$

Fixed short-term

10,000

December 21, 2023

5.24

%  

10,000

Fixed medium-term

20,000

March 21, 2024

5.18

%  

20,000

Fixed medium-term

20,000

March 20, 2025

4.47

%  

20,000

Fixed medium-term

722

October 31, 2025

4.87

%  

722

Fixed medium-term

5,000

November 3, 2025

4.87

%  

5,000

Fixed medium-term

728

December 5, 2025

4.34

%  

728

Fixed medium-term

1,233

September 21, 2026

5.20

%

1,233

Fixed medium-term

20,000

May 2, 2028

3.88

%

20,000

Total

$

87,683

Weighted Average Rate

 

4.71

%  

$

40,000

$

47,683

The Bank is required to maintain an investment in capital stock of the FHLB, as collateral, in an amount equal to a certain percentage of its outstanding debt. FHLB stock is considered restricted stock and is carried at cost. The Bank evaluates FHLB stock for impairment based on the ultimate recovery ability of the cost. No impairment was recognized at either September 30, 2023 or December 31, 2022.

Subordinated Debt

In addition to the Bank, the Company has one other wholly-owned subsidiary, RSB Capital Trust I (the “Trust”). In 2005, the Trust issued $5,000 of pooled trust preferred securities in a private placement and issued 155 shares of common stock at $1 par value per share, to the Company. The Trust, which has no independent assets or operations, was formed in 2005 for the sole purpose of issuing trust preferred securities and investing the proceeds thereof in an equivalent amount of junior subordinated debentures. The proceeds from the issuance of the trust preferred securities were down-streamed to the Bank and are currently considered Tier 1 capital for purposes of determining the Bank’s capital ratios. The duration of the Trust is 30 years.

The subordinated debt securities of $5,155 are unsecured obligations of the Company and are subordinate and junior in right of payment to all present and future senior indebtedness of the Company. The Company has entered into a guarantee, which together with its obligations under the subordinated debt securities and the declaration of trust governing the Trust, including its obligations to pay costs, expenses, debts and liabilities, provides a full and unconditional guarantee of amounts on the capital securities. The subordinated debentures, which bear interest at three month CME term Secured Overnight Financing Rate (“SOFR”) plus 2% and a relative spread adjustment of 0.26% was 7.64% at September 30, 2023. The rate at December 31, 2022 was 6.69% and was based on the three month LIBOR plus 2.00%.  The subordinated debentures mature on May 23, 2035.

Other Borrowings

The Bank has an unsecured, uncommitted $10,000 line of credit with Zions Bank. There were no advances outstanding under this line of credit at either September 30, 2023 or December 31, 2022.

The Bank also has an unsecured, uncommitted $50,000 line of credit with Pacific Coast Bankers Bank. There were no advances outstanding under this line of credit at either September 30, 2023 or December 31, 2022.