Other Borrowed Money

9 Months Ended

Sep. 30, 2011

(12) Other Borrowed Money

Other borrowed money at September 30, 2011 and December 31, 2010 is summarized as follows:

	September 30, 2011		December 31, 2010
Secured Borrowings	$	--	$	4,076
Federal Home Loan Bank Advances		71,000		71,000
	$	71,000	$	75,076

Advances from the Federal Home Loan Bank (FHLB) have maturities ranging from 2012 to 2019 and interest rates ranging from 3.17 percent to 4.75 percent. Under the Blanket Agreement for Advances and Security Agreement with the FHLB, residential first mortgage loans and cash balances held by the FHLB are pledged as collateral for the FHLB advances outstanding. At September 30, 2011, the Company had available line of credit commitments totaling $179,150, of which $108,150 was available. Additional collateral may be required to be pledged in order to utilize the full amount of the remaining credit line.

Secured Borrowings represent the transfer of the guaranteed portion of SBA loans at a premium in which the Company is obligated by the SBA to refund the premium to the “purchaser” if the loan is repaid within 90 days of the transfer. Under Current Accounting Standards, this premium refund obligation is a form of recourse, which means that the transferred guaranteed portion of the loan does not meet the definition of a “participating interest” for the 90-day period that the premium refund obligation exists. As a result, the transfer must be accounted for as a secured borrowing during this period. Effective February 15, 2011, all loans submitted for secondary market sales eliminate the warranty or the 90-day recourse period and the premium may be recognized at the time of the sale.

The aggregate stated maturities of other borrowed money at September 30, 2011 are as follows:


Year	Amount
2011	$	--
2012		41,000
2013		--
2014 and Thereafter		30,000
	$	71,000

The Company also has available federal funds lines of credit with various financial institutions totaling $43,000, of which $0 was outstanding at September 30, 2011.