BORROWINGS

12 Months Ended

Dec. 31, 2018

NOTE 9

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BORROWINGS

For the years ending December 31, advances from the Federal Home Loan Bank were as follows:

(dollars in thousands)	2018	2017
Federal Home Loan Bank of Indianapolis Notes, 2.52%, Due January 7, 2019	$170,000	$0
Federal Home Loan Bank of Indianapolis Notes, 1.67%, Due June 27, 2018	0	80,000
Federal Home Loan Bank of Indianapolis Notes, 6.15%, Due January 16, 2018	0	30
Total	$170,000	$80,030

The outstanding FHLB advance at December 31, 2018 of $170.0 million is a fixed rate advance and may not be prepaid without penalty. All FHLB notes require monthly interest payments and are secured by residential real estate loans and securities with a carrying value of $412.9 million and $370.0 million at December 31, 2018 and 2017. At December 31, 2018, the Company owned $10.4 million of FHLB stock, which also secures debts owed to the FHLB. The Company is authorized by the Board to borrow up to $800.0 million at the FHLB, but availability is limited to $85.6 million based on collateral and outstanding borrowings. Federal Reserve Discount Window borrowings were secured by commercial loans with a carrying value of $381.5 million and $282.1 million as of December 31, 2018 and 2017. The Company had a borrowing capacity of $286.5 million at the Federal Reserve Bank at December 31, 2018. There were no borrowings outstanding at the Federal Reserve Bank at December 31, 2018 and 2017.

The Company had $325.0 million of availability in federal funds lines with twelve correspondent banks, none of which was drawn on as of December 31, 2018 and 2017. Additionally, during 2018 the Bank become a member of the American Financial Exchange (AFX) where overnight fed funds purchased can be obtained from other banks on the Exchange that have approved the Bank for an unsecured, overnight line. These funds are only available if the approving banks have an ‘offer’ out to sell that day. As of December 31, 2018, the total amount approved for the Bank via AFX banks was $119 million, none of which was drawn on as of December 31, 2018.

Securities sold under agreements to repurchase (“repo accounts”) represent collateralized borrowings with customers located primarily within the Company’s service area. All repos at December 31, 2018, 2017 and 2016 mature on demand. Repo accounts are not covered by federal deposit insurance and are secured by securities owned. The Company retains the right to substitute similar type securities and has the right to withdraw all excess collateral applicable to repo accounts whenever the collateral values are in excess of the related repurchase liabilities. However, as a means of mitigating market risk, the Company maintains excess collateral to cover normal changes in the repurchase liability by monitoring daily usage. At December 31, 2018, there were no material amounts of securities at risk with any one customer. The Company maintains control of these securities through the use of third-party safekeeping arrangements.

The following is a schedule, at the end of the year indicated, of statistical information relating to securities sold under agreement to repurchase secured by either U.S. government agency securities or mortgage-backed securities classified as other debt securities. There were no other categories of short-term borrowings for which the average balance outstanding during the period was 30 percent or more of stockholders' equity at the end of each period.

(dollars in thousands)	2018		2017		2016
Securities sold under agreements to repurchase
Outstanding at year end	$75,555		$70,652		$50,045
Approximate average interest rate at year end	0.74	%	0.46	%	0.29	%
Highest amount outstanding as of any month end
during the year	$106,239		$77,886		$60,198
Approximate average outstanding during the year	86,874		63,379		57,945
Approximate average interest rate during the year	0.58	%	0.39	%	0.25	%

Securities sold under agreements to repurchase are secured by mortgage-backed securities with a carrying amount of $100.7 million and $98.0 million at year-end for 2018 and 2017, respectively. Additional information concerning recognition of these liabilities is disclosed in Note 17.