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Borrowings and Borrowing Capacity | 12 Months Ended
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Dec. 31, 2018
Debt Disclosure [Abstract] |
Borrowings And Borrowing Capacity | NOTE 10 — BORROWINGS AND BORROWING CAPACITY Customer Repurchase Agreements Customer repurchase agreements are overnight customer sweep arrangements. Information concerning customer repurchase agreements is summarized as follows:
|  | December 31, |  |  | December 31, |
(Dollars in thousands) |  | 2018 |  |  | 2017 |
Amount outstanding at end of the year |  | $ | 4,485 |  |  | $ | 11,488 |
Weighted average interest rate at end of the year |  |  | 0.01 | % |  |  | 0.02 | %
Average daily balance during the year |  | $ | 8,648 |  |  | $ | 12,906 |
Weighted average interest rate during the year |  |  | 0.02 | % |  |  | 0.02 | %
Maximum month-end balance during the year |  | $ | 13,844 |  |  | $ | 21,041 |
Customer repurchase agreements are secured by pledged securities with carrying amounts as follows:
|  | December 31, |  |  | December 31, |
(Dollars in thousands) |  | 2018 |  |  | 2017 |
U.S. Government agency obligations |  | $ | 5,916 |  |  | $ | 13,460 |
FHLB Advances FHLB advances are collateralized by assets, including a blanket pledge of certain loans. FHLB advances and weighted average interest rates at end of period by contractual maturity are summarized as follows:
|  | Fixed Rate |  |  | Variable Rate |
(Dollars in thousands) |  | Balance Outstanding |  |  | Weighted Average Interest Rate |  |  | Balance Outstanding |  |  | Weighted Average Interest Rate |
2019 |  | $ | 300,000 |  |  |  | 2.52 | % |  | $ | — |  |  |  | — |
2027 |  |  | — |  |  |  | — |  |  |  | 30,000 |  |  |  | 2.55 | %
|  | $ | 300,000 |  |  |  | 2.52 | % |  | $ | 30,000 |  |  |  | 2.55 | %
Information concerning FHLB advances is summarized as follows:
|  | December 31, |  |  | December 31, |
(Dollars in thousands) |  | 2018 |  |  | 2017 |
Amount outstanding at end of the year |  | $ | 330,000 |  |  | $ | 365,000 |
Weighted average interest rate at end of the year |  |  | 2.52 | % |  |  | 1.39 | %
Average daily balance during the year |  | $ | 345,388 |  |  | $ | 300,451 |
Weighted average interest rate during the year |  |  | 1.96 | % |  |  | 1.05 | %
Maximum month-end balance during the year |  | $ | 455,000 |  |  | $ | 385,000 |
The Company’s unused borrowing capacity with the FHLB is as follows:
|  | December 31, |  |  | December 31, |
(Dollars in thousands) |  | 2018 |  |  | 2017 |
Borrowing capacity |  | $ | 846,427 |  |  | $ | 596,230 |
Borrowings outstanding |  |  | 330,000 |  |  |  | 365,000 |
Unused borrowing capacity |  | $ | 516,427 |  |  | $ | 231,230 |
Federal Funds Purchased The Company had no federal funds purchased at December 31, 2018 or 2017. However, as of December 31, 2018 the Company had unsecured federal funds lines of credit with seven unaffiliated banks totaling $137,500,000. Subordinated Notes On September 30, 2016, the Company issued $50,000,000 of Fixed-to-Floating Rate Subordinated Notes due 2026 (the “Notes”). The Notes initially bear interest at 6.50% per annum, payable semi-annually in arrears, to, but excluding, September 30, 2021, and, thereafter and to, but excluding, the maturity date or earlier redemption, interest shall be payable quarterly in arrears, at an annual floating rate equal to three-month LIBOR as determined for the applicable quarterly period, plus 5.345%. The Company may, at its option, beginning on September 30, 2021 and on any scheduled interest payment date thereafter, redeem the Notes, in whole or in part, at a redemption price equal to the outstanding principal amount of the Notes to be redeemed plus accrued and unpaid interest to, but excluding, the date of redemption. The Notes are subordinated in right of payment to the Company’s existing and future senior indebtedness and are structurally subordinated to the Company’s subsidiaries’ existing and future indebtedness and other obligations. The Notes are included on the consolidated balance sheets as liabilities at their carrying values of $48,929,000 and $48,828,000 at December 31, 2018 and 2017, respectively; however, for regulatory purposes, the carrying value of these obligations were eligible for inclusion in Tier 2 regulatory capital. Issuance costs related to the Notes totaled $1,324,000, including an underwriting discount of 1.5%, or $750,000, and have been netted against the subordinated notes liability on the balance sheet. The underwriting discount and other debt issuance costs are being amortized using the effective interest method through maturity and recognized as a component of interest expense. Junior Subordinated Debentures The following provides a summary of the Company’s junior subordinated debentures:
|  |  |  |  |  |  |  |  |  |  |  | Variable |  | Interest Rate At |
(Dollars in thousands) |  | Face Value |  |  | Carrying Value |  |  | Maturity Date |  | Interest Rate |  | December 31, 2018 |
National Bancshares Capital Trust II |  | $ | 15,464 |  |  | $ | 12,975 |  |  | September 2033 |  | LIBOR + 3.00% |  | 5.79% |
National Bancshares Capital Trust III |  |  | 17,526 |  |  |  | 12,576 |  |  | July 2036 |  | LIBOR + 1.64% |  | 4.08% |
ColoEast Capital Trust I |  |  | 5,155 |  |  |  | 3,478 |  |  | September 2035 |  | LIBOR + 1.60% |  | 4.40% |
ColoEast Capital Trust II |  |  | 6,700 |  |  |  | 4,554 |  |  | March 2037 |  | LIBOR + 1.79% |  | 4.59% |
Valley Bancorp Statutory Trust I |  |  | 3,093 |  |  |  | 2,855 |  |  | September 2032 |  | LIBOR + 3.40% |  | 6.22% |
Valley Bancorp Statutory Trust II |  |  | 3,093 |  |  |  | 2,645 |  |  | July 2034 |  | LIBOR + 2.75% |  | 5.54% |
|  | $ | 51,031 |  |  | $ | 39,083 |  |  |  |  |  |  |  |  |
These debentures are unsecured obligations due to trusts that are unconsolidated subsidiaries. The debentures were issued in conjunction with the trusts’ issuances of obligated capital securities. The trusts used the proceeds from the issuances of their capital securities to buy floating rate junior subordinated deferrable interest debentures that bear the same interest rate and terms as the capital securities. These debentures are the trusts’ only assets and the interest payments from the debentures finance the distributions paid on the capital securities. These debentures rank junior and are subordinate in the right of payment to all other debt of the Company. As part of the purchase accounting adjustments made with the National Bancshares, Inc. acquisition on October 15, 2013, the ColoEast acquisition on August 1, 2016, and the Valley acquisition on December 9, 2017, the Company adjusted the carrying value of the junior subordinated debentures to fair value as of the respective acquisition dates. The discount on the debentures will continue to be amortized through maturity and recognized as a component of interest expense. The debentures may be called by the Company at par plus any accrued but unpaid interest. Interest on the debentures is calculated quarterly. The distribution rate payable on the capital securities is cumulative and payable quarterly in arrears. The Company has the right to defer payments on interest on the debentures at any time by extending the interest payment period for a period not exceeding 20 consecutive quarters with respect to each deferral period, provided that no extension period may extend beyond the redemption or maturity date of the debentures. The debentures are included on the consolidated balance sheet as liabilities; however, for regulatory purposes, the carrying value of these obligations are eligible for inclusion in Tier I regulatory capital, subject to certain limitations. All of the carrying value of $39,083,000 and $38,623,000 was allowed in the calculation of Tier I regulatory capital as of December 31, 2018 and 2017, respectively.

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI http://asc.fasb.org/topic&trid=2208564 + Details
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