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Borrowings
 9 Months Ended
Sep. 30, 2024
Debt Disclosure [Abstract]  
Borrowings

Note 4 – Borrowings

FHLB Borrowings

The Bank has a line of credit from the FHLB secured by pledged qualifying commercial and residential mortgage loans and securities. At September 30, 2024 and December 31, 2023, the line totaled $680.1 million and $455.6 million, respectively, based on pledged collateral. 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 $190.0 million and $210.0 million at September 30, 2024 and December 31, 2023, respectively. The FHLB borrowings required the Bank to hold $11.3 million and $12.3 million of FHLB stock at September 30, 2024 and December 31, 2023, respectively, which is included in restricted equity investments on the consolidated balance sheets.

At September 30, 2024 and December 31, 2023, the Bank also had letters of credit outstanding with the FHLB in the amount of $81.2 million and $110.1 million, respectively, of which $80.0 million and $110.0 million were 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. Available balances on the FHLB credit facility were $408.9 million and $135.5 million as of September 30, 2024 and December 31, 2023, respectively.

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

 

 

September 30, 2024

(Dollars in thousands)

 

Balance

 

 

Origination Date

 

Stated Interest Rate

 

 

Maturity Date

Fixed rate credit (1)

 

$

40,000

 

 

7/29/2024

 

4.75% - 4.89%

 

 

7/29/2025 - 11/18/2025

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

 

$

190,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Consists of four $10 million advances.

 

 

 

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 $69.6 million and $161.0 million as of September 30, 2024 and December 31, 2023, respectively, of which the Company had no outstanding advances as of both dates. The $65.0 million advance obtained through the BTFP was repaid at its maturity in the second quarter of 2024.

Other Borrowings

The Company had an unsecured line of credit with a correspondent bank of $10.0 million as of both September 30, 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 September 30, 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 September 30, 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 September 30, 2024, the net carrying amount of the 2029 Notes was $25.0 million, inclusive of a $503 thousand purchase accounting adjustment (premium). For both the three months ended September 30, 2024 and 2023, the effective interest rate on the 2029 Notes was 5.3%, inclusive of the amortization of the purchase accounting

adjustment (premium). For the nine months ended September 30, 2024 and 2023, the effective interest rate on the 2029 Notes was 5.2% and 5.1%, respectively, inclusive of the amortization of the purchase accounting adjustment (premium). As of September 30, 2024, the net carrying amount of the 2030 Note, including capitalized, unamortized debt issuance costs, was $14.8 million. For the three and nine months ended September 30, 2024 and 2023, the effective interest rate on the 2030 Note was 6.08% and 6.10%, respectively.