NOTE 10 - SHORT-TERM BORROWINGS

The Bank has short-term advances from the FHLB that had maturity dates of less than one year at the time of the advance. All balances are due within one year and can be renewed at the time of maturity. FHLB advances are secured by pledgings described in the following Long-Term Borrowings footnote. Balances at year end were as follows:

	2016					2015
			Weighted					Weighted
			Average					Average
	Amount		Rate			Amount		Rate
Repurchase advance with a rate of .39% to .70% at December 31, 2016 and 2015	$	100,000		0.63	%	$	100,000		0.39	%
Cash management advance with rates from .39% to .59% at December 31, 2016 and 2015		20,000		0.59	%	$	50,000		0.39	%
Total advances	$	120,000		0.63	%	$	150,000		0.39	%

Securities sold under repurchase agreements are secured by the Bank’s holdings of debt securities issued by U.S. government sponsored entities and agencies with a carrying amount of $82.0 million and $79.3 million at year ended 2016 and 2015.

Repurchase agreements are financing arrangements that mature within 89 days and usually overnight. Under the agreements, customers agree to maintain funds on deposit with the Bank and in return acquire an interest in a pool of securities pledged as collateral against the funds. The securities are held in segregated safekeeping accounts at the Federal Reserve Bank and Trust. Information concerning securities sold under agreements to repurchase is summarized as follows:

	2016			2015			2014
Average balance during the year	$	84,368		$	71,779		$	71,573
Average interest rate during the year		0.07	%		0.07	%		0.04	%
Maximum month-end balance during the year	$	98,687		$	89,574		$	78,972
Weighted average year-end interest rate		0.08	%		0.06	%		0.06	%
Balance at year-end	$	78,110		$	75,482		$	58,786

The following table provides a disaggregation of the obligation by class of collateral pledged for short-term financing obtained through the sales of repurchase agreements:

	2016		2015
Overnight and continuous repurchase agreements
U.S. Treasury and U.S. government sponsored entities	$	6,555	$	5,276
State and political subdivisions		12,304		2,640
Mortgage-backed securities - residential		52,628		60,391
Collateralized mortgage obligations		6,623		7,175
Total borrowings	$	78,110	$	75,482

Management believes the risks associated with the agreements are minimal and in the case of collateral decline the Company has additional investment securities available to adequately pledge as guarantees for the repurchase agreements.

The Bank has access to lines of credit amounting to $25 million at two major domestic banks that are below prime rate. The lines and terms are periodically reviewed by the banks and are generally subject to withdrawal at their discretion. There were no borrowings under these lines at December 31, 2016 and 2015.

Farmers has two unsecured revolving lines of credit for $6.5 million. The lines can be renewed annually. The lines have interest rates of prime with floors of 3.5% and 4.5%. The outstanding balance on the two lines was $350 thousand at December 31, 2016 and 2015. The interest rate on the outstanding balance at December 31, 2016 and 2015 was 4.5%.