Short and Long-Term Funding

3 Months Ended

Mar. 31, 2021

Debt Disclosure [Abstract]

Short and Long-Term Funding

Short and Long-Term Funding

The following table presents the components of short-term funding (funding with original contractual maturities of one year or less) and long-term funding (funding with original contractual maturities greater than one year):

($ in Thousands)	March 31, 2021		December 31, 2020
Short-Term Funding
Federal funds purchased	$	7,450	$	7,070
Securities sold under agreements to repurchase	131,057		185,901
Federal funds purchased and securities sold under agreements to repurchase	138,507		192,971
Commercial paper	51,171		59,346
Total short-term funding	$	189,678	$	252,317
Long-Term Funding
Bank senior notes, at par, due 2021	$	300,000	$	300,000
Corporation subordinated notes, at par, due 2025	250,000		250,000
Finance leases	1,091		1,128
Capitalized costs	(1,362)		(1,663)
FHLB advances	1,629,966		$	1,632,723
Total long-term funding	2,179,694		2,182,188
Total short and long-term funding	$	2,369,372	$	2,434,505

Securities Sold Under Agreements to Repurchase

The Corporation enters into agreements under which it sells securities subject to an obligation to repurchase the same or similar securities. Under these arrangements, the Corporation may transfer legal control over the assets but still retain effective control through an agreement that both entitles and obligates the Corporation to repurchase the assets. The obligation to repurchase the securities is reflected as a liability on the Corporation’s consolidated balance sheets, while the securities underlying the repurchase agreements remain in the respective investment securities asset accounts (i.e., there is no offsetting or netting of the investment securities assets with the repurchase agreement liabilities). See Note 11 for additional disclosures on balance sheet offsetting.

The Corporation utilizes securities sold under agreements to repurchase to facilitate the needs of its customers. As of March 31, 2021, the Corporation pledged agency mortgage-related securities with a fair value of $192 million as collateral for the repurchase agreements. Securities pledged as collateral under repurchase agreements are maintained with the Corporation's safekeeping agents and are monitored on a daily basis due to the market risk of fair value changes in the underlying securities. The Corporation generally pledges excess securities to ensure there is sufficient collateral to satisfy short-term fluctuations in both the repurchase agreement balances and the fair value of the underlying securities.

The remaining contractual maturity of the securities sold under agreements to repurchase on the consolidated balance sheets as of March 31, 2021 and December 31, 2020 are presented in the following table:

	Remaining Contractual Maturity of the Agreements
($ in Thousands)	Overnight and Continuous		Up to 30 days		30-90 days		Greater than 90 days		Total
March 31, 2021
Repurchase agreements
Agency mortgage-related securities	$	131,057	$	—	$	—	$	—	$	131,057
Total	$	131,057	$	—	$	—	$	—	$	131,057
December 31, 2020
Repurchase agreements
Agency mortgage-related securities	$	185,901	$	—	$	—	$	—	$	185,901
Total	$	185,901	$	—	$	—	$	—	$	185,901

Long-Term Funding

Senior Notes 

In August 2018, the Bank issued $300 million of senior notes, due August 2021, and callable July 2021. The senior notes have a fixed coupon interest rate of 3.50% and were issued at a discount.

Subordinated Notes 

In November 2014, the Corporation issued $250 million of 10-year subordinated notes, due January 2025, and callable October 2024. The subordinated notes have a fixed coupon interest rate of 4.25% and were issued at a discount.

Finance Leases

In connection with the construction of new branches in Oshkosh and Eau Claire, Wisconsin, the Corporation entered into land leases with options to purchase the underlying land for a fixed price, which the Corporation now expects to exercise. The finance leases have fixed interest rates of approximately 1.00%. See Note 18 for additional disclosure regarding the Corporation’s leases.