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Borrowings
12 Months Ended
Dec. 31, 2012
Borrowings
11.   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,
 
     2012     2011     2010  

Retail repurchase agreements

      

Amount outstanding at year-end

   $ 15,357      $ 23,858      $ 20,720   

Average amount outstanding during year

     20,485        24,403        22,809   

Maximum amount outstanding at any month-end

     27,985        24,798        26,106   

Rate paid at year-end

     0.01     0.01     0.25

Weighted average rate paid during the year

     0.01        0.08        0.25   

Commercial paper

      

Amount outstanding at year-end

   $ —        $ —        $ —     

Average amount outstanding during year

     —          —          8,435   

Maximum amount outstanding at any month-end

     —          —          18,948   

Rate paid at year-end

     —       —       —  

Weighted average rate paid during the year

     —          —          0.25   

Other short-term borrowings

      

Amount outstanding at year-end

   $ —        $ —        $ —     

Average amount outstanding during year

     30        11        1   

Maximum amount outstanding at any month-end

     —          —          —     

Rate paid at year-end

     —       —       —  

Weighted average rate paid during the year

     —          —          —     

FHLB borrowings

      

Amount outstanding at year-end

   $ —        $ —        $ 35,000   

Average amount outstanding during year

     1        2,027        95,231   

Maximum amount outstanding at any month-end

     —          5,000        101,000   

Rate paid at year-end

     —       —       2.99

Weighted average rate paid during the year

     —          3.55        1.79   

 

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 money market sweep account.

 

Correspondent Bank Lines of Credit

 

At December 31, 2012, the Company had access to three secured and one unsecured lines of credit from three correspondent banks totaling $50 million. At December 31, 2011, the Company had access to two secured and one unsecured lines of credit from three correspondent banks totaling $35 million. None of the lines of credit were utilized as of either date. These correspondent bank funding sources may be canceled at any time at the correspondent bank’s discretion.

 

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. 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. The Company can borrow up to 15% of total assets from the FHLB.

 

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

 

     December 31,  
     2012      2011  

Available lendable loan collateral value pledged to serve against FHLB advances

   $ 79,922       $ 66,690   

Available lendable investment security collateral value pledged to serve against FHLB advances

     —           15,410   
  

 

 

    

 

 

 

Total lendable collateral value pledged to serve against FHLB advances

   $ 79,922       $ 82,100   
  

 

 

    

 

 

 

 

At both December 31, 2012 and 2011, the Company had no outstanding advances from the FHLB.

 

Federal Reserve Discount Window

 

At December 31, 2012 and 2011, $4.1 million and $10.9 million of loans and investment securities, respectively, were pledged as collateral to cover the various Federal Reserve services that are available for use by the Company. In May 2012, the Company was notified by the Federal Reserve that any future borrowings from the Discount Window would be reinstated at the primary credit rate. 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. From the first quarter 2010 through the second quarter 2012, the Company was able to borrow from the Discount Window at the secondary credit rate and such borrowings could only be used as a backup source of funding on a very short-term basis or to facilitate an orderly resolution of operational issues. The Company has not drawn on this availability since its initial establishment in 2009 other than to periodically test its ability to access the line. The Federal Reserve has the discretion to deny approval of borrowing requests.