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Borrowings
 3 Months Ended
Mar. 31, 2024
Debt Disclosure [Abstract]  
Borrowings

Note 4 – Borrowings

FHLB Borrowings

The Bank has a line of credit from the FHLB secured by pledged qualifying real estate loans and securities. At March 31, 2024 and December 31, 2023, based on pledged collateral, the line totaled $656.5 million and $455.6 million, respectively. The FHLB will lend up to 30% of the Bank’s total assets as of the prior quarter end, subject to certain eligibility requirements, including adequate collateral. The Bank had borrowings from the FHLB totaling $280.0 million and $210.0 million at March 31, 2024 and December 31, 2023, respectively. FHLB borrowings required the Bank to hold $15.6 million and $12.3 million of FHLB stock at March 31, 2024 and December 31, 2023, respectively, which is included in restricted equity investments on the consolidated balance sheets.

At March 31, 2024 and December 31, 2023, the Bank also had letters of credit outstanding with the FHLB in the amount of $111.2 million and $110.1 million, respectively, of which $110.0 million was for the purpose of collateral for public deposits with the Treasury Board of the Commonwealth of Virginia as of the same dates. Outstanding letters of credit reduce the available balance of the borrowing facility with the FHLB, which was $265.4 million and $135.5 million as of March 31, 2024 and December 31, 2023, respectively.

The following tables present information regarding FHLB advances outstanding as of the dates stated.

 

 

March 31, 2024

(Dollars in thousands)

 

Balance

 

 

Origination Date

 

Stated Interest Rate

 

 

Maturity Date

Daily Rate Credit

 

$

130,000

 

 

5/8/2023

 

 

5.58

%

 

5/8/2024

Fixed Rate Credit

 

 

50,000

 

 

3/15/2023

 

 

4.07

%

 

3/15/2027

Fixed Rate Credit

 

 

50,000

 

 

5/2/2023

 

 

3.87

%

 

5/3/2027

Fixed Rate Credit

 

 

50,000

 

 

5/4/2023

 

 

3.52

%

 

5/4/2028

Total FHLB borrowings

 

$

280,000

 

 

 

 

 

 

 

 

 

 

 

December 31, 2023

(Dollars in thousands)

 

Balance

 

 

Origination Date

 

Stated Interest Rate

 

 

Maturity Date

Daily Rate Credit

 

$

60,000

 

 

5/8/2023

 

 

5.57

%

 

5/8/2024

Fixed Rate Credit

 

 

50,000

 

 

3/15/2023

 

 

4.07

%

 

3/15/2027

Fixed Rate Credit

 

 

50,000

 

 

5/2/2023

 

 

3.87

%

 

5/3/2027

Fixed Rate Credit

 

 

50,000

 

 

5/4/2023

 

 

3.52

%

 

5/4/2028

Total FHLB borrowings

 

$

210,000

 

 

 

 

 

 

 

 

FRB Borrowings

The Company may obtain advances from the FRB through the FRB Discount Window. The Company had secured capacity through the FRB Discount Window of $101.8 million and $161.0 million, of which the Company had no outstanding advances as of March 31, 2024 and December 31, 2023, respectively. As of March 31, 2024, the Company had secured capacity under the BTFP of $69.0 million, of which the Company had drawn one advance for $65.0 million, maturing May 10, 2024, with a fixed interest rate of 4.74%. BTFP advances can be repaid at any time without penalty. On January 24, 2024, the Federal Reserve announced that the BTFP program would cease making new loans effective March 11, 2024.

Other Borrowings

The Company had an unsecured line of credit with a correspondent bank of $10.0 million as of both March 31, 2024 and December 31, 2023. This line bears interest at the prevailing rates for such loans and is cancelable any time by the correspondent bank. As of both March 31, 2024 and December 31, 2023, this line of credit was undrawn.

The Company had $39.8 million and $39.9 million of subordinated notes, net, outstanding as of March 31, 2024 and December 31, 2023, respectively. The Company's subordinated notes are comprised of an issuance in October 2019 maturing October 15, 2029 (the “2029 Notes”) and an issuance in May 2020 maturing June 1, 2030 (the “2030 Note”). As of March 31, 2024, the net carrying amount of the 2029 Notes was $25.1 million, inclusive of a $553 thousand purchase accounting adjustment (premium). For the three months ended March 31, 2024 and 2023, the effective interest rate on the 2029 Notes was 5.22% and 5.09%, respectively, inclusive of the amortization of the purchase accounting adjustment (premium). As of March 31, 2024, the net carrying amount of the 2030 Note, including capitalized, unamortized debt issuance costs, was $14.8 million. For the three months ended March 31, 2024 and 2023, the effective interest rate on the 2030 Note was 6.09% and 6.10%, respectively.