Long-Term Debt and FHLB Stock

9 Months Ended

Sep. 30, 2024

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, 2024 and December 31, 2023, the Bank had access to a preapproved secured line of credit with the FHLB of $633,017 and $656,516, respectively. Borrowings under this line require collateralization through the pledge of specific loans and securities. At September 30, 2024 and December 31, 2023, the Bank had pledged assets of $275,857 and $228,172, respectively. At September 30, 2024 and December 31, 2023, the Company had outstanding overnight line of credit balances with the FHLB of $10,000 and $0, respectively. The interest rate was 5.06% at September 30, 2024. These borrowings mature the following business day. The Company also had structured borrowings of $49,773. The outstanding principal amounts and the related terms and rates at September 30, 2024 were as follows:

Term	Principal		Maturity	Rate		Due in one year		Long term
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		381	November 9, 2026	5.04	%		—		381
Fixed medium-term		969	May 3, 2027	4.99	%		—		969
Fixed medium-term		740	June 21, 2027	4.73	%		—		740
Fixed medium-term		20,000	May 2, 2028	3.88	%		—		20,000
Total	$	49,773	Weighted Average Rate	4.31	%	$	20,000	$	29,773

The Bank is required to maintain an investment in FHLB capital stock, 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, 2024 or December 31, 2023.

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 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 rate on the subordinated debentures, which bear interest at the three-month term Secured Overnight Financing Rate (“SOFR”) plus 2% and a relative spread adjustment of 0.26%, was 7.36% and 7.64% at September 30, 2024 and December 31, 2023, respectively. 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, 2024 or December 31, 2023.

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, 2024 or December 31, 2023.