XML 33 R19.htm IDEA: XBRL DOCUMENT
v3.24.0.1

Borrowings and Subordinated Notes | 12 Months Ended
--- | ---
Dec. 31, 2023
Debt Disclosure [Abstract] |
Borrowings and Subordinated Notes | Note 10 – Borrowings and Subordinated Notes Short Term Debt Due to the funding requirement for the acquisition of PFSB to be provided from the holding company, the Company secured borrowings from a correspondent bank. Two loans were secured, the first a $30 million 12-month term note and the second a 12-month line of credit for $10 million. Both loans were advanced on October 1, 2021. Interest on both loans was due quarterly and accrued at a rate of 2.50% per annum with reporting and capital covenants included. The structure of the acquisition required all accounting of the transaction to be recorded at the Bank level as Perpetual did not have a holding company. The Company advanced funds from the Bank to the Company to facilitate payoff of the term note and line of credit balance after regulatory approval was granted in the second quarter of 2022. The line of credit remained open for future liquidity needs. On September 29, 2022, the line of credit was advanced for $10 million for the acquisition of PFSL. Interest on the line of credit was due quarterly and accrued at a rate of 5.50% per annum with reporting and capital covenants included. The $10 million line of credit was paid off in the first quarter of 2023 and not renewed at maturity on September 30, 2023. The Company has established a $15 million variable line of credit tied to prime with a correspondent bank that matures on September 27, 2024. As of December 31, 2023, there were no outstanding borrowings on the line of credit. Long Term Debt Federal Home Loan Bank Advances Long term debt consists of various loans from the Federal Home Loan Banks. Repayment structures vary, ranging from monthly installments, annual payments or upon maturity. Interest payments are due monthly. Total borrowings were $265.8 million excluding an amortizing $23 thousand for fair value related to the acquisitions for December 31, 2023 compared to $127.4 million excluding an accretive $47 thousand for fair value for December 31, 2022. With the acquisition of Peoples Federal Savings and Loan Association, the Bank undertook $965 thousand in advances with varying maturity dates from 2022 through 2028. With the acquisition of Perpetual Federal Savings Bank, the Bank undertook $6 million in advances due in 2024. The advances were secured by a pledge of $223.0 and $232.9 million of 1-4 family real estate and HELOC loans as of December 31, 2023 and 2022, respectively under a blanket collateral agreement. During 2023, the Bank began pledging eligible commercial real estate loans of $158.9 million to the FHLB as of December 31, 2023. The advances are subject to pre-payment penalties and the provisions and conditions of the credit policy of the Federal Home Loan Bank. The Bank had access to $128.0 and $73.0 million unsecured borrowings through correspondent banks as of December 31, 2023 and December 31, 2022, respectively. The Bank had a borrowing capacity under the Federal Reserve's BTFP of $69.9 million at December 31, 2023. The Bank also had access to $150.1 million and $130.4 million through a Cash Management Advance with the Federal Home Loan Bank as of December 31, 2023 and December 31, 2022 respectively. The Bank had unpledged securities, which could be sold or used as collateral, of $97.3 million and $249.6 million at the end of the same time periods, respectively. An additional $42.5 million at December 31, 2023, and $2.0 million at December 31, 2022, were available from the Federal Home Loan Bank based on current pledging. The table below shows the maturities of the borrowings exclusive of the fair value adjustment.
|  | (In Thousands) |
2024 |  | $ | 32,500 |
2025 |  |  | 56,500 |
2026 |  |  | 50,000 |
2027 |  |  | 52,149 |
2028 |  |  | 74,624 |
Thereafter |  |  | - |
Total |  | $ | 265,773 |
Subordinated Notes On July 30, 2021, the Company announced the completion of a private placement of $35 million aggregate principal amount of its 3.25% fixed-to-floating rate subordinated notes due July 30, 2031 (the “Notes”) to various accredited investors (the “Offering”). The price for the Notes was 100% of the principal amount of the Notes. The Notes are qualify as Tier 2 capital for regulatory purposes in proportionate amounts until July 30, 2026. The Company used the net proceeds from the Offering for general corporate purposes, including financing acquisitions and organic growth. Interest on the Notes accrues at a rate equal to (i) 3.25% per annum from the original issue date to, but excluding, the five-year anniversary, payable semi-annually in arrears, and (ii) a floating rate per annum equal to a benchmark rate, which is expected to be the Three-Month Term SOFR (as defined in the Notes), plus a spread of 263 basis points from and including the five-year anniversary until maturity, payable quarterly in arrears. Beginning on or after the fifth anniversary of the issue date through maturity, the Notes may be redeemed, at the Company’s option, on any scheduled interest payment date. Any redemption will be at a redemption price equal to 100% of the principal amount of Notes being redeemed, plus accrued and unpaid interest.
|  | December 31, 2023 |  |  | December 31, 2022 |
(In Thousands) |  | Principal |  |  | Unamortized Note Issuance Costs |  |  | Principal |  |  | Unamortized Note Issuance Costs |
Subordinated Notes |  | $ | 35,000 |  |  | $ | (298 | ) |  | $ | 35,000 |  |  | $ | (414 | )

X
- References No definition available. + Details
Name: | us-gaap_DebtDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for borrowings under subordinated debt agreements that qualify as available in computing net capital under SEC's uniform net capital rule, including restrictive covenants, collateral, interest rates and due dates, amounts due by date and amount owed in total. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 942 -SubTopic 470 -Name Accounting Standards Codification -Section 45 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480876/942-470-45-1 + Details
Name: | us-gaap_SubordinatedBorrowingsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration