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Borrowings | 9 Months Ended
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Sep. 30, 2022
Borrowings |
Borrowings | ​ Note 7 – Borrowings ​ The following table is a summary of borrowings as of September 30, 2022, and December 31, 2021. Junior subordinated debentures are discussed in more detail in Note 8: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | September 30, 2022 |  | December 31, 2021 |
Securities sold under repurchase agreements | ​ | $ | 35,497 | ​ | $ | 50,337 | ​
Other short-term borrowings | ​ | ​ | 25,000 | ​ | ​ | - | ​
Junior subordinated debentures | ​ | ​ | 25,773 | ​ | ​ | 25,773 | ​
Subordinated debentures | ​ | ​ | 59,275 | ​ | ​ | 59,212 | ​
Senior notes | ​ | ​ | 44,559 | ​ | ​ | 44,480 | ​
Notes payable and other borrowings | ​ | ​ | 10,000 | ​ | ​ | 19,074 | ​
Total borrowings | ​ | $ | 200,104 | ​ | $ | 198,876 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ The Company enters into deposit sweep transactions where the transaction amounts are secured by pledged securities. These transactions consistently mature overnight from the transaction date and are governed by sweep repurchase agreements. All sweep repurchase agreements are treated as financings secured by U.S. government agencies and collateralized mortgage-backed securities and had a carrying amount of $35.5 million at September 30, 2022, and $50.3 million at December 31, 2021. The fair value of the pledged collateral was $72.4 million at September 30, 2022, and $113.0 million at December 31, 2021. At September 30, 2022, there were no customers with secured balances exceeding 10% of stockholders’ equity. ​ The Company’s borrowings at the FHLBC require the Bank to be a member and invest in the stock of the FHLBC. Total borrowings are generally limited to the lower of 35% of total assets or 60% of the book value of certain mortgage loans. As of September 30, 2022, the Bank had $25.0 million in short-term advances outstanding under the FHLBC. There were no short-term advances as of December 31, 2021. The Bank assumed $23.4 million of long-term FHLBC advances with our ABC Bank acquisition in 2018. The remaining balance of $5.9 million was paid off in full during the second quarter of 2022. FHLB stock held at September 30, 2022 was valued at $4.5 million, and any potential FHLBC advances were collateralized by loans with a principal balance of $861.1 million, which carried a FHLBC-calculated combined collateral value of $576.7 million. The Company had excess collateral of $536.7 million available to secure borrowings at September 30, 2022. ​ The Company also had $44.6 million and $44.5 million of senior notes outstanding, net of deferred issuance costs, as of September 30, 2022 and December 31, 2021, respectively. The senior notes were issued in December 2016 with a ten year maturity, and terms include interest payable semiannually at 5.75% for five years. Beginning December 31, 2021, the senior debt began to pay interest at a floating rate, with interest payable quarterly at three month LIBOR plus 385 basis points. The notes are redeemable, in whole or in part, at the option of the Company, beginning with the interest payment date on December 31, 2021, and on any floating rate interest payment date thereafter, at a redemption price equal to 100% of the principal amount of the notes plus accrued and unpaid interest. As of September 30, 2022, and December 31, 2021, unamortized debt issuance costs related to the senior notes were $441,000 and $520,000, respectively, and are included as a reduction of the balance of the senior notes on the Consolidated Balance Sheet. These deferred issuance costs will be amortized to interest expense over the ten year term of the notes and are included in the Consolidated Statements of Income. ​ On February 24, 2020, the Company originated a $20.0 million term note, of which $10.0 million is outstanding as of September 30, 2022, with a correspondent bank. The term note was issued for a three year term at one-month LIBOR plus 175 basis points, requires principal payments quarterly and interest payments monthly, and the balance of this note is included within Notes Payable and Other Borrowings on the Consolidated Balance Sheet. The Company also has an undrawn line of credit of $30.0 million with a correspondent bank to be used for short-term funding needs; advances under this line can be outstanding up to 360 days from the date of issuance. This line of credit has not been utilized since early 2019. ​ In the second quarter of 2021, we sold and issued $60.0 million in aggregate principal amount of our 3.50% Fixed-to-Floating Rate Subordinated Notes due April 15, 2031 (the “Notes”). The Notes were offered and sold to eligible purchasers in a private offering in reliance on the exemption from the registration requirements of Section 4(a)(2) of the Securities Act of 1933, as amended and the provisions of Regulation D promulgated thereunder. The Company intends to use the net proceeds from the offering for general corporate purposes, which may include, without limitation, the redemption of existing senior debt, common stock repurchases and strategic acquisitions. The Notes bear interest at a fixed annual rate of 3.50%, from and including the date of issuance to but excluding April 15, 2026, payable semi-annually in arrears. From and including April 15, 2026 to, but excluding the maturity date or early redemption date, the interest rate will reset quarterly to an interest rate per annum equal to Three-Month Term SOFR (as defined in the Note) plus 273 basis points, payable quarterly in arrears. As of September 30, 2022, we had $59.3 million of subordinated debentures outstanding, net of deferred issuance costs.

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