12.

Borrowings

The following table provides detail with respect to borrowings at the dates and for the periods indicated (dollars in thousands).


	At and for the years ended December 31,
	2011			2010			2009
Retail repurchase agreements
Amount outstanding at year-end	$	23,858		$	20,720		$	15,545
Average amount outstanding during year		24,403			22,809			23,227
Maximum amount outstanding at any month-end		24,798			26,106			29,461
Rate paid at year-end		0.01	%		0.25	%		0.25	%
Weighted average rate paid during the year		0.08			0.25			0.25

Commercial paper
Amount outstanding at year-end	$	—		$	—		$	19,061
Average amount outstanding during year		—			8,435			24,085
Maximum amount outstanding at any month-end		—			18,948			27,041
Rate paid at year-end		—	%		—	%		0.25	%
Weighted average rate paid during the year		—			0.25			0.25

Other short-term borrowings
Amount outstanding at year-end	$	—		$	—		$	—
Average amount outstanding during year		11			1			5,335
Maximum amount outstanding at any month-end		—			—			17,295
Rate paid at year-end		—	%		—	%		—	%
Weighted average rate paid during the year		—			—			0.62

FHLB borrowings
Amount outstanding at year-end	$	—		$	35,000		$	101,000
Average amount outstanding during year		2,027			95,231			78,166
Maximum amount outstanding at any month-end		5,000			101,000			170,000
Rate paid at year-end		—	%		2.99	%		2.01	%
Weighted average rate paid during the year		3.55			1.79			2.27

Retail Repurchase Agreements

Retail repurchase agreements represent overnight secured borrowing arrangements between the Bank and certain clients. Retail repurchase agreements are securities transactions, not insured deposits.

Commercial Paper

Through June 30, 2010 using a master note arrangement between the Company and the Bank, Palmetto Master Notes were issued as an alternative investment for commercial sweep accounts. These master notes were unsecured but backed by the full faith and credit of the Company. The commercial paper was issued only in conjunction with deposits in the Bank's automated sweep accounts. Effective July 1, 2010, the Company terminated the commercial paper program, and all commercial paper accounts were converted to a new money market sweep account.

Correspondent Bank Lines of Credit

At December 31, 2011, the Company had access to two secured and one unsecured line of credit from correspondent banks. The following table summarizes the Company's line of credit funding utilization and availability at the dates indicated (in thousands).


	December 31,
	2011		2010
Correspondent bank line of credit accomodations	$	35,000	$	5,000
Utilized correspondent bank line of credit accomodations		—		—

Available correspondent bank line of credit accomodations	$	35,000	$	5,000

In April 2011, the Company obtained an uncommitted overnight variable-rate line of credit from a correspondent bank totaling $25 million. If drawn upon, the Company will be required to pledge investment securities with a fair value equal to 110% of the amount borrowed. These correspondent bank lines of credit funding sources may be canceled at any time at the correspondent bank's discretion.

In October 2011, the Company obtained an additional $5 million secured line of credit from another correspondent bank.

FHLB Borrowings

As disclosed in Note 3, Investment Securities Available for Sale, and Note 4, Loans, the Company pledges investment securities and loans to collateralize FHLB advances and letters of credit. Additionally, the Company may pledge cash and cash equivalents. The amount that can be borrowed is based on the balance of the type of asset pledged as collateral multiplied by lendable collateral value percentages, as calculated by the FHLB. In June 2011, the Company was notified by the FHLB that its borrowing capacity had been increased from 10% of total assets to 15% of total assets.

The Company is a member of the FHLB of Atlanta, which is one of 12 regional FHLBs that administer home financing credit for depository institutions. As an FHLB member, and to be eligible to borrow, the Company is required to purchase and maintain stock in the FHLB. No ready market exists for FHLB stock, and this stock has no quoted market value. Purchases and redemptions are normally transacted each quarter to adjust the Company's investment to an amount based on the FHLB requirements, which are generally based on the amount of borrowings the Company has outstanding with the FHLB. Requests for redemptions of FHLB stock are met at the discretion of the FHLB. The carrying value of this stock was $3.5 million at December 31, 2011 and $6.8 million at December 31, 2010 and is included in Other assets in the Consolidated Balance Sheets. During 2011, the FHLB repurchased $3.3 million of the FHLB stock owned by the Company. The stock was repurchased at book value therefore no gain or loss was recognized.

The following table summarizes FHLB borrowed funds utilization and availability at the dates indicated (in thousands).


	December 31,
	2011		2010
Available lendable loan collateral value to serve against FHLB advances and letters of credit	$	66,690	$	92,464
Available lendable investment security collateral value to serve against FHLB advances and letters of credit		15,410		46,275
Advances and letters of credit
FHLB advances		—		(35,000	)
Letters of credit		—		(50,000	)
Excess		82,100		53,303

In September 2011, the Company's undrawn $50 million letter of credit with the FHLB matured and the Company chose not to renew it as a result of having sufficient excess pledgeable securities and related liquidity. At December 31, 2011, the Company had no outstanding advances or letters of credit from the FHLB.

Any FHLB advance with a fixed interest rate is subject to a prepayment fee in the event of full or partial repayment prior to maturity or the expiration of any interim interest rate period. In December 2010, January 2011 and May 2011, the Company prepaid $61.0 million, $30.0 million, and $5.0 million respectively, of FHLB advances resulting in prepayment penalties of $33 thousand, $136 thousand, and $276 thousand respectively.

Federal Reserve Discount Window

At both December 31, 2011 and December 31, 2010, $10.9 million of loans and securities were pledged as collateral to cover the various Federal Reserve System services that are available for use by the Company. Primary credit is available through the Discount Window to generally sound depository institutions on a very short-term basis, typically overnight, at a rate above the Federal Open Market Committee target rate for federal funds. The Company's maximum maturity for potential borrowings is overnight. Although the Company has not drawn on this availability since its establishment in 2009, any potential borrowings from the Federal Reserve Discount Window would be at the secondary credit rate and must be used as a backup source of funding on a very short-term basis or to facilitate an orderly resolution of operational issues, and the Federal Reserve has the discretion to deny approval of borrowing requests.

Convertible Debt

In March 2010, the Company issued unsecured convertible promissory notes in an aggregate principal amount of $380 thousand to members of the Board of Directors. The notes bore interest at 10% per year payable quarterly, had a stated maturity of March 31, 2015, were prepayable by the Company at any time at the discretion of the Board of Directors, and were mandatorily convertible into common stock of the Company at the same terms and conditions as other investors that participate in the Company's next stock offering. The proceeds from the issuance of the notes were contributed to the Bank as a capital contribution. Upon the consummation of the Private Placement on October 7, 2010, the convertible promissory notes were converted into shares of the Company's common stock at the same price per share as the common stock issued in the Private Placement, and the accrued interest was paid on October 7, 2010.