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SHORT-TERM BORROWINGS AND LONG-TERM DEBT
 3 Months Ended
Mar. 31, 2013
SHORT-TERM BORROWINGS AND LONG-TERM DEBT  
SHORT-TERM BORROWINGS AND LONG-TERM DEBT

10.  SHORT-TERM BORROWINGS AND LONG-TERM DEBT

 

At March 31, 2013 and December 31, 2012, we had no short-term borrowings.

 

At March 31, 2013, our bank maintained a $20.9 million line of credit with the Federal Reserve discount window, of which there were no advances outstanding. As of March 31, 2013, certain commercial and commercial real estate loans totaling $34.8 million have been pledged as collateral on our line of credit with the Federal Reserve discount window. The Federal Reserve does not have the right to sell or repledge these loans.

 

The bank is a member of and maintained an $862.4 million line of credit with the Federal Home Loan Bank of Seattle (the “FHLB”) as of March 31, 2013. Long-term borrowings under this arrangement totaled $27,000 at March 31, 2013, compared to $32,000 at December 31, 2012. There were no short-term borrowings under this arrangement at March 31, 2013 and December 31, 2012. At March 31, 2013 the bank’s pledged assets to the FHLB included investment securities with a fair value of $97.7 million and certain real estate loans totaling $1.2 billion.

 

On August 20, 2009, we began deferring regularly scheduled interest payments on our outstanding junior subordinated debentures relating to our trust preferred securities. The terms of the junior subordinated debentures and the trust documents allow us to defer payments of interest for up to 20 consecutive quarterly periods without default or penalty. During the deferral period, the respective trusts suspended the declaration and payment of dividends on the trust preferred securities. Also during the deferral period, we may not, among other things and with limited exceptions, pay cash dividends on or repurchase our common stock or make any payment on outstanding debt obligations that rank equally with or junior to the junior subordinated debentures. During the deferral period, we continued to accrue, and reflect in our consolidated financial statements, the deferred interest payments on our junior subordinated debentures. In March 2013, the Company elected to pay all deferred interest on its subordinated debentures and related dividend payments on its trust preferred securities and resume quarterly payments for each outstanding trust. As a result, the deferred accrued interest in the amount of $13.0 million was paid in full.