Note 9 - Borrowed Funds and Securities Sold Under Agreements to Repurchase

12 Months Ended

Dec. 31, 2014

Disclosure Text Block [Abstract]

Repurchase Agreements, Resale Agreements, Securities Borrowed, and Securities Loaned Disclosure [Text Block]

9. Borrowed Funds and Securities Sold Under Agreements to Repurchase

Borrowed funds and securities sold under agreements to repurchase are summarized as follows at December 31:

	2014					2013
	Amount		Weighted Average Rate			Amount		Weighted Average Rate
	(Dollars in thousands)
Repurchase agreements - fixed rate:
Due in 2014	$	-		-	%	$	9,300		1.27	%
Due in 2016		38,000		1.92			68,000		3.27
Due in 2017		38,000		4.16			38,000		4.16
Due in 2020		40,000		3.45			40,000		3.45
Total repurchase agreements - fixed rate		116,000		3.18			155,300		3.41
FHLB-NY advances - fixed rate:
Due in 2014		-		-			89,500		0.63
Due in 2015		185,551		0.80			166,732		1.21
Due in 2016		315,847		1.15			331,062		1.20
Due in 2017		305,525		2.12			174,160		2.79
Due in 2018		74,798		1.29			65,798		1.24
Due in 2019		30,000		1.83			-		-
Total FHLB-NY advances - fixed rate		911,721		1.44			827,252		1.48
Junior subordinated debentures - adjustable rate
Due in 2037		28,771		5.96			29,570		5.67
Total borrowings	$	1,056,492		1.75	%	$	1,012,122		1.90	%

During 2014, $66.9 million in long-term FHLB-NY advances at an average cost of 2.98% and $30.0 million in repurchase agreements at an average cost of 4.98% were prepaid while incurring a prepayment penalty totaling $5.2 million.

Borrowings which have call provisions are summarized as follows at December 31, 2014:

	Amount		Rate			Maturity Date	Call Date
	(Dollars in thousands)
FHLB-NY advances - fixed rate	$	20,000		4.43	%	10/10/2017	1/9/2015
FHLB-NY advances - fixed rate		30,000		4.60		10/10/2017	1/9/2015
FHLB-NY advances - fixed rate		10,000		4.13		9/18/2017	3/17/2015
FHLB-NY advances - fixed rate		10,000		4.32		9/18/2017	3/17/2015
FHLB-NY advances - fixed rate		10,000		4.15		9/18/2017	3/18/2015
Repurchase agreements - fixed rate		20,000		2.20		7/12/2016	1/12/2015
Repurchase agreements - fixed rate		18,000		4.28		10/18/2017	1/20/2015
Repurchase agreements - fixed rate		18,000		1.60		4/19/2016	1/20/2015
Repurchase agreements - fixed rate		20,000		4.05		9/19/2017	3/19/2015
Repurchase agreements - fixed rate		10,000		3.08		8/1/2020	2/1/2016
Repurchase agreements - fixed rate		10,000		3.19		2/1/2020	2/1/2016
Repurchase agreements - fixed rate		20,000		3.76		8/1/2020	2/1/2016

As part of the Company’s strategy to finance investment opportunities and manage its cost of funds, the Company enters into repurchase agreements with broker-dealers and the FHLB-NY.

These agreements are recorded as financing transactions and the obligations to repurchase are reflected as a liability in the consolidated financial statements. The securities underlying the agreements were delivered to the broker-dealers or the FHLB-NY who arranged the transaction. The securities remain registered in the name of the Company and are returned upon the maturity of the agreement. The Company retains the right of substitution of collateral throughout the terms of the agreements. All the repurchase agreements are collateralized by mortgage-backed securities. Information relating to these agreements at or for the years ended December 31 is as follows:

	2014			2013			2012
	(Dollars in thousands)
Book value of collateral	$	142,925		$	199,447		$	228,620
Estimated fair value of collateral		142,925			199,447			228,620
Average balance of outstanding agreements during the year		137,824			172,944			185,300
Maximum balance of outstanding agreements at a month end during the year		155,300			185,300			185,300
Average interest rate of outstanding agreements during the year (1)		5.37	%		3.42	%		3.62	%

1. As discussed above, during the year ended December 31, 2014, the Company prepaid $30.0 million in FHLB-NY repurchase agreements at an average cost of 4.98% while incurring a prepayment penalty totaling $2.7 million.  Excluding the prepayment penalty, the average interest rate of agreements during the year ended December 31, 2014 was 3.40%.

Pursuant to a blanket collateral agreement with the FHLB-NY, advances are secured by all of the Bank’s stock in the FHLB-NY and certain qualifying mortgage loans in an amount at least equal to 110% of the advances outstanding. The Bank may also pledge mortgage-backed and mortgage-related securities, and other securities not otherwise pledged.

The Holding Company has three trusts formed under the laws of the State of Delaware for the purpose of issuing capital and common securities, and investing the proceeds thereof in junior subordinated debentures of the Holding Company. Each of these trusts issued $20.6 million of securities which had a fixed-rate for the first five years, after which they reset quarterly based on a spread over 3-month LIBOR. The securities were first callable at par after five years, and pay cumulative dividends. The Holding Company has guaranteed the payment of these trusts’ obligations under their capital securities. The terms of the junior subordinated debentures are the same as those of the capital securities issued by the trusts. The junior subordinated debentures issued by the Holding Company are carried at fair value in the consolidated financial statements.

The table below shows the terms of the securities issued by the trusts.

	Flushing Financial Capital Trust II			Flushing Financial Capital Trust III			Flushing Financial Capital Trust IV
Issue Date	June 20, 2007			June 21, 2007			July 3, 2007
Initial Rate		7.14	%		6.89	%		6.85	%
First Reset Date	September 1, 2012			June 15, 2012			July 30,2012
Spread over 3-month LIBOR		1.41	%		1.44	%		1.42	%
Maturity Date	September 1, 2037			September 15, 2037			July 30, 2037

The consolidated financial statements do not include the securities issued by the trusts, but rather include the junior subordinated debentures of the Holding Company.