NOTE 11: LONG TERM DEBT

Long-term debt at December 31, 2011 and 2010 consisted of the following components:


		2011			2010
(In thousands)
Federal Home Loan Bank advances (A)	$	82,500		$	82,500
Less: Deferred prepayment penalty on modification of FHLB
advances		(1,654	)		(2,331	)
Net Federal Home Loan Bank advances		80,846			80,169
Subordinated Debentures – BVBC Capital Trust II (B)		7,732			7,732
Subordinated Debentures – BVBC Capital Trust III (C)		11,856			11,856

Total long-term debt	$	100,434		$	99,757

(A)	Due in 2013, 2014, 2015, 2016 and 2018; collateralized by various assets including mortgage-backed loans and available-for-sale securities totaling $159,011,000 at December 31, 2011. Advances, at interest rates from 0.31% to 4.26% are subject to restrictions or penalties in the event of prepayment. Federal Home Loan Bank advance availability is determined quarterly and at December 31, 2011, approximately $16,282,000 was available. Advances are made at the discretion of the Federal Home Loan Bank of Topeka.
	In the third quarter of 2010, the Company repaid $42,500,000 of FHLB advances by rolling the net present value of the advances being repaid into the funding cost of $42,500,000 of new advances. A $2,569,000 modification fee was associated with paying off the original FHLB advances which is amortized as an adjustment of interest expense over the remaining term of the new FHLB advances using the straight line method. The unamortized modification fee at December 31, 2011 was approximately $1,654,000. This transaction reduced the effective interest rate, as well as modified the maturity date on these borrowings.
(B)	Due in 2033; interest only at three month LIBOR + 3.25% (3.68% at December 31, 2011 and 3.54% at December 31, 2010) due quarterly; fully and unconditionally guaranteed by the Company on a subordinated basis to the extent that the funds are held by the Trust. BVBC Capital Trust II issued and sold $7,500,000 in Capital Securities to third parties and $232,000 of Common Securities to the Company. As of 2008, the Company may prepay the subordinated debentures, in whole or in part, at their face value plus accrued interest.
(C)	Due in 2035; interest only at three month LIBOR + 1.60% (2.18% at December 31, 2011 and 1.90% at December 31, 2010) due quarterly; fully and unconditionally guaranteed by the Company on a subordinated basis to the extent that the funds are held by the Trust. BVBC Capital Trust III issued and sold $11,500,000 in Preferred Securities to third parties and $356,000 in Common Securities to the Company. Subordinated to the trust preferred securities (B) due in 2033. As of 2010, the Company may prepay the subordinated debentures, in whole or in part, at their face value plus accrued interest.

At the request of the Federal Reserve Bank of Kansas City, quarterly payments are being deferred on the Company's outstanding trust preferred securities. Under the governing documents of the BVBC Capital Trust II and III, the quarterly payments since April 24, 2009 for BVBC Capital Trust II and March 31, 2009 for BVBC Capital Trust III were deferred. The Company has the right to declare such a deferral for up to 20 consecutive quarterly periods and deferral may only be declared as long as the Company is not then in default under the provisions of the Amended and Restated Trust Agreement. During the deferral period, interest on the indebtedness continues to accrue and the unpaid interest is compounded. For BVBC Capital Trust III, the Company must also accrue additional interest that is equal to the three month LIBOR rate plus 1.60% during the deferral period. All accrued interest and compounded interest must be paid at the end of the deferral period.

For both BVBC Capital Trust II and BVBC Capital Trust III, as long as the deferral period continues, the Company is prohibited from: (i) declaring or paying any dividend on any of its capital stock, which would include both its common stock and the outstanding preferred stock issued to the United States Department of Treasury (the "Treasury"), or (ii) making any payment on any debt security that is ranked pari passu with the debt securities issued by the respective trusts. Because the Preferred Shares issued under the U.S. Treasury's Capital Purchase Plan (the "CPP") are subordinate to the trust preferred securities, the Company will be restricted from paying dividends on these Preferred Shares until such time as all trust preferred dividends have been brought current. See Note 13, Regulatory Matters for additional information.

Aggregate annual maturities of long-term debt at December 31, 2011 are as follows:


(In thousands)
2012		$	-
2013			20,000
2014			7,500
2015			20,000
2016			10,000
Thereafter			44,588
			102,088
Less:	Deferred prepayment penalty on modification of
	FHLB advances		(1,654	)
		$	100,434