Other Borrowings

3 Months Ended

Mar. 31, 2015

NOTE 9 – OTHER BORROWINGS

The Company has, from time to time, utilized certain borrowing arrangements with various financial institutions to fund growth in earning assets or provide additional liquidity when appropriate spreads can be realized. At March 31, 2015, December 31, 2014 and March 31, 2014, there were $43.9 million, $78.9 million and $59.7 million, respectively, outstanding borrowings with the Company’s correspondent banks.

Other borrowings consist of the following:


(Dollars in Thousands)	March 31, 2015		December 31, 2014		March 31, 2014
Daily Rate Credit from Federal Home Loan Bank with a fixed interest rate of 0.36%	$	—	$	35,000	$	25,000
Advances under revolving credit agreement with a regional bank with interest at 90-day LIBOR plus 3.50% (3.73% at March 31, 2015 and December 31, 2014) due in August 2016, secured by subsidiary bank stock		24,000		24,000		—
Advances under revolving credit agreement with a regional bank with interest at 90-day LIBOR plus 4.00% (4.24% at March 31, 2014) due in August 2016, secured by subsidiary bank stock		—		—		10,000
Advance from correspondent bank with a fixed interest rate of 4.50%, due November 27, 2017, secured by subsidiary bank loan receivable		4,851		4,881		4,963
Subordinated debt issued by Prosperity Bank due June 2016 with an interest rate of 90-day LIBOR plus 1.60% (1.84% at March 31, 2014)		—		—		5,000
Subordinated debt issued by The Prosperity Banking Company due September 2016 with an interest rate of 90-day LIBOR plus 1.75% (2.02% at March 31, 2015, 1.99% at December 31, 2014 and 1.98% at March 31, 2014)		15,000		15,000		14,714

Total	$	43,851	$	78,881	$	59,677

The advances from the Federal Home Loan Bank (“FHLB”) are collateralized by a blanket lien on all first mortgage loans and other specific loans in addition to FHLB stock. At March 31, 2015, $275.5 million was available for borrowing on lines with the FHLB.

As of March 31, 2015, the Company maintained credit arrangements with various financial institutions to purchase federal funds up to $50 million.

The Company also participates in the Federal Reserve discount window borrowings. At March 31, 2015, the Company had $581.8 million of loans pledged at the Federal Reserve discount window and had $409.7 million available for borrowing.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

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