Borrowings

12 Months Ended

Dec. 31, 2021

Borrowings [Abstract]

Borrowings

11. BORROWINGS

Short term borrowings, and the related maximum amounts outstanding at the end of any month in the years ended December 31, 2021 and 2020, are presented below.

(Dollars in thousands)					Maximum Outstanding at
	Years Ended December 31,				Any Month End
	2021		2020		2021		2020
Repurchase agreements	$	4,227	$	4,750	$	4,804	$	4,889
Short-term borrowings with FHLB:
Overnight advances		—		—		9,000		—
3-month advances		—		20,000		20,000		20,000
	$	4,227	$	24,750	$	33,804	$	24,889

The following table presents supplemental information related to short-term borrowings.

(Dollars in thousands)	Securities sold under
	agreements to repurchase						Short-term borrowings
	2021			2020			2021			2020
Amount outstanding as of December 31	$	4,227		$	4,750		$	—		$	20,000
Weighted average interest rate as of December 31		0.10	%		0.14	%		—	%		0.31	%
Average amount outstanding during the year		4,249			4,033			6,741			14,521
Weighted average interest rate during the year		0.10	%		0.17	%		0.38	%		0.42	%

The Bank has repurchase agreements with some of its depositors, under which customers’ funds are invested daily into an interest bearing account. These funds are carried by the Company as short-term debt. It is the Company’s policy to completely collateralize repurchase agreements with U.S. Government securities. As of December 31, 2021, the securities that serve as collateral for securities sold under agreements to repurchase had a fair value of $7,249,000. The interest rate paid on these funds is variable and subject to change daily.

The Company participated in the Federal Reserve Bank’s Paycheck Protection Program Liquidity Facility (“PPPLF”) in 2020 and received $31,298,000 in advances. The advances were collateralized by PPP loans granted by the Company. The maturity date of the PPPLF advances equaled the maturity date of the underlying PPP loans pledged to secure the extension of credit. The maturity date of the PPPLF’s extension of credit was accelerated to the extent of any loan forgiveness reimbursement received by the Company from the SBA. The interest rate on the advances was fixed at 0.35%. As of December 31, 2021, there were no outstanding PPPLF advances as the Company repaid the remaining amount in the first quarter of 2021. As of December 31, 2020, $27,955,000 PPPLF advances were outstanding.

Long-term debt is comprised only of FHLB advances with an original maturity of one year or more. Outstanding balances were $20,000,000 as of December 31, 2021 and $35,000,000 as of December 31, 2020.

The following table summarizes the scheduled maturities of long-term debt as of December 31, 2021.

(Dollars in thousands)	Scheduled		Weighted Average
Year	Maturities		Interest Rate
2022	$	—	—	%
2023		—	—
2024		15,000	2.29
2025		5,000	2.41
2026		—	—
Thereafter		—	—
	$	20,000	2.32	%

The Bank must maintain sufficient qualifying collateral with the FHLB to secure borrowings. Therefore, a Master Collateral Agreement has been entered into which pledges all mortgage related assets as collateral for future borrowings.

Mortgage related assets could include loans or investment securities. As of December 31, 2021, the amount of loans included in qualifying collateral was $253,763,000. As of December 31, 2020, the amount of loans included in qualifying collateral was $229,357,000. No investment securities were included in qualifying collateral as of December 31, 2021 or 2020.

The Bank’s maximum borrowing capacity with the FHLB was $182,573,000, with a balance of $20,724,000 outstanding as of December 31, 2021. The Bank’s maximum borrowing capacity with the FHLB was $166,178,000, with a balance of $55,830,000 outstanding as of December 31, 2020. To borrow additional amounts, the FHLB would require the Bank to purchase additional FHLB Stock. The FHLB is a source of both short-term and long-term funding. The Bank must maintain sufficient qualifying collateral to secure all outstanding advances. Qualifying collateral is defined by the FHLB and includes outstanding balances of the Company’s real estate loans, excluding loans with certain risk mitigants, including delinquencies and loans made to insiders, borrowers with low credit scores or loans with high loan-to-value ratios.