Transfers of Financial Assets

3 Months Ended

Mar. 31, 2018

6. Transfers of Financial Assets

The Company’s transfers of financial assets with continuing interest may include pledges of collateral to secure public deposits and repurchase agreements, FHLB and FRB borrowing capacity, automated clearing house (“ACH”) transactions and interest rate swaps.

For public deposits and repurchase agreements, the Company enters into bilateral agreements with the entity to pledge investment securities as collateral in the event of default. The right of setoff for a repurchase agreement resembles a secured borrowing, whereby the collateral pledged by the Company would be used to settle the fair value of the repurchase agreement should the Company be in default. The counterparty has the right to sell or repledge the investment securities. The Company is required by the counterparty to maintain adequate collateral levels. In the event the collateral fair value falls below stipulated levels, the Company will pledge additional investment securities. For transfers of assets with the FHLB and the FRB, the Company enters into bilateral agreements to pledge loans and investment securities as collateral to secure borrowing capacity. For ACH transactions, the Company enters into bilateral agreements to collateralize possible daylight overdrafts. For interest rate swaps, the Company enters into bilateral agreements to pledge collateral when either party is in a negative fair value position to mitigate counterparty credit risk. Counterparties to ACH transactions, certain interest rate swaps, the FHLB and the FRB do not have the right to sell or repledge the collateral.

The carrying amounts of the assets pledged as collateral to secure public deposits, borrowing arrangements and other transactions as of March 31, 2018 and December 31, 2017 were as follows:


(dollars in thousands)	March 31, 2018		December 31, 2017
Public deposits	$	2,486,067	$	2,800,690
Federal Home Loan Bank		2,475,887		2,388,702
Federal Reserve Bank		914,177		914,454
ACH transactions		151,462		151,526
Interest rate swaps		30,657		27,502
Total	$	6,058,250	$	6,282,874

As the Company did not enter into reverse repurchase agreements, no collateral was accepted as of March 31, 2018 and December 31, 2017. In addition, no debt was extinguished by in-substance defeasance. At March 31, 2018, the Company had $1.5 billion and $676.8 million of lines of credit available from the FHLB and the FRB, respectively. None of the lines available were drawn upon as of March 31, 2018.

The Company did not have any repurchase agreements as of March 31, 2018 and December 31, 2017.