SECURITIES SOLD UNDER AGREEMENTS TO REPURCHASE

6 Months Ended

Jun. 30, 2015

SECURITIES SOLD UNDER AGREEMENTS TO REPURCHASE

SECURITIES SOLD UNDER AGREEMENTS TO REPURCHASE

9. SECURITIES SOLD UNDER AGREEMENTS TO REPURCHASE

At June 30, 2015, June 30, 2014 and December 31, 2014, securities sold under agreements to repurchase totaled $26.6 million, $11.4 million, and $36.3 million, respectively, and were secured by U.S. GSE, residential mortgage-backed securities and residential collateralized mortgage obligations with a carrying amount of $29.1 million, $15.4 million and $40.3 million, respectively.

Securities sold under agreements to repurchase are financing arrangements with $1.6 million maturing during the third quarter of 2015, and $25.0 million maturing during the fourth quarter of 2015. At maturity, the securities underlying the agreements are returned to the Company. Information concerning the securities sold under agreements to repurchase is summarized as follows:

	For the six months ended						For the year ended
(Dollars in thousands)	June 30, 2015			June 30, 2014			December 31, 2014
Average daily balance	$	29,213		$	11,594		$	14,185
Average interest rate		0.74	%		3.22	%		2.71	%
Maximum month-end balance	$	36,230		$	12,045		$	36,879
Weighted average interest rate		0.74	%		3.17	%		2.67	%

The primary risk associated with these secured borrowings is the requirement to pledge a market value based balance of collateral in excess of the borrowed amount. The excess collateral pledged represents an unsecured exposure to the lending counterparty. As the market value of the collateral changes, both through changes in discount rates and spreads as well as related cash flows, additional collateral may need to be pledged. In accordance with our policies, eligible counterparties are defined and monitored to minimize our exposure.