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Long-term Funding
12 Months Ended
Dec. 31, 2012
Long-term Funding [Abstract]  
Long-term Funding

NOTE 8  LONG-TERM FUNDING:

 

Long-term funding (funding with original contractual maturities greater than one year) at December 31 was as follows.

 

  20122011
  ($ in Thousands)
FHLB advances$400,375$500,476
Senior notes, at par 585,000 430,000
Subordinated debt, at par 25,821 25,821
Junior subordinated debentures, at par  - 211,340
Other borrowed funds and capitalized costs 4,150 9,434
 Total long-term funding$1,015,346$1,177,071

FHLB advances: Long-term advances from the FHLB had maturities through 2020 and had weighted-average interest rates of 1.79%, at both December 31, 2012 and 2011. These advances all had fixed contractual rates at both December 31, 2012, and 2011.

 

Senior notes: In March 2011, the Corporation issued $300 million of senior notes at a discount. In September 2011, the Corporation issued an additional $130 million of senior notes at a premium. The 2011 senior note issuances mature on March 28, 2016 and have a fixed coupon interest rate of 5.125%. In September 2012, the Corporation issued $155 million of senior notes at a discount. The 2012 senior note issuance matures on March 12, 2014 and has a fixed coupon interest rate of 1.875%

 

Subordinated debt: In September 2008, the Corporation issued $26 million of 10-year subordinated debt with a 5-year no-call provision. The subordinated debt was issued at a discount, and has a fixed coupon interest rate of 9.25%. Subordinated debt qualifies under the risk-based capital guidelines as Tier 2 supplementary capital for regulatory purposes, and is discounted in accordance with regulations when the debt has five years or less remaining to maturity.

 

Junior subordinated debentures: As of December 31, 2011, the Corporation owned 100% of the common securities of three trusts: ASBC Capital I, SFSC Capital I, and SFSC Capital II (the “Trusts”). The Trusts were formed for purposes of issuing trust preferred securities to third-party investors and investing the proceeds from the issuance of the trust preferred securities and common securities solely in junior subordinated debentures issued by the Corporation (or assumed by the Corporation in connection with an acquisition). The junior subordinated debentures are the sole assets of the Trusts. In the consolidated balance sheets, the junior subordinated debentures issued by the Corporation to the Trusts are reported as long-term funding and the common securities of the Trusts, all of which are owned by the Corporation, are included in other assets. The Corporation redeemed all outstanding junior subordinated debentures during 2012.

 

 

The table below summarizes the maturities of the Corporation’s long-term funding at December 31, 2012.
   
Year($ in Thousands)
2013$400,042
2014 154,987
2015 1,560
2016 432,832
2017 85
Thereafter 25,840
Total long-term funding$1,015,346

Under agreements with the Federal Home Loan Bank of Chicago, FHLB advances (short-term and long-term) are secured by qualifying mortgages of the subsidiary bank (such as residential mortgage, residential mortgage loans held for sale, home equity, and commercial real estate) and by specific investment securities for certain FHLB advances. At December 31, 2012, the Corporation had $3.2 billion of residential mortgage and home equity loans pledged as collateral to the FHLB, and approximately $600 million of residential mortgage and home equity loans remained available to pledge to the FHLB.