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Deposits and Borrowings

9 Months Ended

Sep. 30, 2024

Note 6— Deposits and Borrowings

The following tables show the components of the Company’s funding sources.


(Dollars in thousands)	September 30, 2024		December 31, 2023
Deposits:
Non-interest bearing demand deposits⁽¹⁾	$	472,422	$	411,374
Interest-bearing demand deposits⁽¹⁾		685,385		607,971
Savings deposits		43,779		52,061
Time deposits⁽²⁾		734,564		835,194
Total Deposits	$	1,936,150	$	1,906,600

(1)

Overdraft demand deposits reclassified to loans totaled $1 thousand at September 30, 2024 and $1 thousand at December 31, 2023.

(2)

The aggregate amount of certificates of deposit with a minimum denomination of $250,000 was $335.1 million and $359.3 million at September 30, 2024 and December 31, 2023, respectively.

The Company obtains certain deposits through the efforts of third-party brokers. Brokered deposits totaled $276.1 million and $320.6 million at September 30, 2024 and December 31, 2023, respectively, and were included primarily in time deposits on the Company’s Consolidated Balance Sheets. At September 30, 2024, there were no depositors that represented 5% or more of the Company’s total deposits.


						September 30, 2024		December 31, 2023
(Dollars in thousands)	Stated Interest Rate Range		Weighted-Average Interest Rate			Carrying Value		Carrying Value
Short-term Debt:
Federal Reserve Bank borrowings	4.76	%		4.76	%	$	—	$	54,000
Total Short-term Debt						$	—	$	54,000
Long-term Debt:
FHLB advances	3.92% - 4.15	%		4.01	%		56,000		—
Subordinated debt	5.25	%		5.25	%	$	24,770	$	24,708
Total Long-term Debt						$	80,770	$	24,708

The Company completed a private placement of a $25.0 million fixed-to-floating subordinated note on June 15, 2022. Subject to limited exceptions permitting earlier redemption, the note is callable, in whole or in part, commencing July 1, 2027. Unless redeemed earlier, the note will mature on July 1, 2032. The note bears interest at a fixed rate of 5.25% to but excluding July 1, 2027, and will bear interest at a floating rate equal to the three-month Secured Overnight Financing Rate plus 245 basis points thereafter. The note is carried at its principal amount, less unamortized issuance costs.

The Company, from time to time, uses FHLB advances as a source of funding and to manage interest rate risk. FHLB advances are secured by a blanket floating lien on all real estate mortgage loans secured by 1-to-4 family residential, multi-family and commercial real estate properties. On September 3, 2024, the Company took out three fixed interest rate advances with terms of 18, 24, and 36 months. The interest rates on the advances range from 3.92% to 4.15%. At September 30, 2024, these three outstanding FHLB advances totaled $56.0 million. Available borrowing capacity based on collateral value amounted to approximately $373.2 million as of September 30, 2024.

The Company also has the capacity to borrow up to $101.6 million at the Federal Reserve discount window of which $0 had been drawn upon at September 30, 2024. The Bank had loans pledged at the Federal Reserve discount window totaling $147.6 million as of September 30, 2024.

On March 12, 2023, the Federal Reserve Bank of Richmond (“Reserve Bank”) made available the Bank Term Funding Program (“BTFP”), which enhances the ability of banks to borrow against the par value of certain high-quality, unencumbered investments. In January 2024, the Company refinanced its $54.0 million advance and secured an additional $23.0 million from the BTFP. On September 3, 2024, the Company paid off the BTFP advance.

The Company also has federal funds lines of credit with correspondent banks available for overnight borrowing of $110.0 million, of which $0 had been drawn upon at September 30, 2024.

The following table shows the carrying amount of the Company’s time deposits by contractual maturity as of September 30, 2024.


(Dollars in thousands)	September 30, 2024
2024	$	157,862
2025		411,226
2026		104,949
2027		59,094
2028		553
Thereafter		880
Total	$	734,564