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Borrowings

9 Months Ended

Sep. 30, 2020

Disclosure Text Block

Note 16 – Borrowings

Assets sold under agreements to repurchase amounted to $106 million at September 30, 2020 and $193 million December 31, 2019.

The Corporation’s repurchase transactions are overcollateralized with the securities detailed in the table below. The Corporation’s repurchase agreements have a right of set-off with the respective counterparty under the supplemental terms of the master repurchase agreements. In an event of default each party has a right of set-off against the other party for amounts owed in the related agreement and any other amount or obligation owed in respect of any other agreement or transaction between them. Pursuant to the Corporation’s accounting policy, the repurchase agreements are not offset with other repurchase agreements held with the same counterparty.

The following table presents information related to the Corporation’s repurchase transactions accounted for as secured borrowings that are collateralized with debt securities available-for-sale, other assets held-for-trading purposes or which have been obtained under agreements to resell. It is the Corporation’s policy to maintain effective control over assets sold under agreements to repurchase; accordingly, such securities continue to be carried on the Consolidated Statements of Financial Condition.

Repurchase agreements accounted for as secured borrowings

		September 30, 2020		December 31, 2019
			Repurchase		Repurchase
(In thousands)			liability		liability
U.S. Treasury securities
	Within 30 days	$	14,861	$	88,646
	After 30 to 90 days		14,636		78,061
	After 90 days		72,457		24,538
Total U.S. Treasury securities			101,954		191,245
Mortgage-backed securities
	Within 30 days		2,961		1,235
	After 90 days		287		-
Total mortgage-backed securities			3,248		1,235
Collateralized mortgage obligations
	Within 30 days		826		898
Total collateralized mortgage obligations			826		898
Total		$	106,028	$	193,378

Repurchase agreements in this portfolio are generally short-term, often overnight. As such our risk is very limited. We manage the liquidity risks arising from secured funding by sourcing funding globally from a diverse group of counterparties, providing a range of securities collateral and pursuing longer durations, when appropriate.

At September 30, 2020, other short-term borrowings consisted of $100 million in FHLB advances. There were no other short-term borrowings outstanding at December 31, 2019.

The following table presents the composition of notes payable at September 30, 2020 and December 31, 2019.

(In thousands)	September 30, 2020			December 31, 2019
Advances with the FHLB with maturities ranging from 2020 through 2029 paying interest at monthly fixed rates ranging from 0.39% to 4.19%	$	519,208		$	421,399
Advances with the FRB maturing on 2022 paying interest annually at a fixed rate of 0.35%		1,009			-
Unsecured senior debt securities maturing on 2023 paying interest semiannually at a fixed rate of 6.125%, net of debt issuance costs of $ 3,743		296,257			295,307
Junior subordinated deferrable interest debentures (related to trust preferred securities) with maturities ranging from 2033 to 2034 with fixed interest rates ranging from 6.125% to 6.7%, net of debt issuance costs of $375		384,922			384,902
Total notes payable	$	1,201,396		$	1,101,608
Note: Refer to the Corporation's 2019 Form 10-K for rates information at December 31, 2019.

A breakdown of borrowings by contractual maturities at September 30, 2020 is included in the table below.

		Assets sold under		Short-term
(In thousands)		agreements to repurchase		borrowings		Notes payable	Total
2020	$	33,284	$	100,000	$	11,931	$	145,215
2021		72,744		-		50,040		122,784
2022		-		-		104,156		104,156
2023		-		-		339,518		339,518
2024		-		-		91,943		91,943
Later years		-		-		603,808		603,808
Total borrowings	$	106,028	$	100,000	$	1,201,396	$	1,407,424

At September 30, 2020 and December 31, 2019, the Corporation had FHLB borrowing facilities whereby the Corporation could borrow up to $3.2 billion and $3.6 billion, respectively, of which $0.6 billion and $0.4 billion, respectively, were used. In addition, at September 30, 2020 and December 31, 2019, the Corporation had placed $0.9 billion of the available FHLB credit facility as collateral for a municipal letter of credit to secure deposits. The FHLB borrowing facilities are collateralized with loans held-in-portfolio, and do not have restrictive covenants or callable features.

Also, at September 30, 2020, the Corporation has a borrowing facility at the discount window of the Federal Reserve Bank of New York amounting to $1.4 billion (2019 - $1.1 billion), which remained unused at September 30, 2020 and December 31, 2019. The facility is a collateralized source of credit that is highly reliable even under difficult market conditions.