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Note 10 - Other Borrowings

12 Months Ended

Dec. 31, 2013

10.

OTHER BORROWINGS

Other borrowings consist of advances from the FHLB and subordinated debt as follows:

(Dollar amounts in thousands)	Maturity range		Weighted- average			Stated interest rate range
Description	from	to	interest rate			from			to				2013		2012
Fixed rate amortizing	03/01/14	10/01/28		4.02	%		2.78	%		4.48	%	$	3,361	$	4,722
Junior subordinated debt	12/21/37	12/21/37		1.97			1.91			1.98			8,248		8,248

Total												$	11,609	$	12,970

The scheduled maturities of other borrowings are as follows:

(Dollar amounts in thousands)
			Weighted-
Year Ending December 31,	Amount		Average Rate

2014	$	984		3.99	%
2015		685		4.01	%
2016		502		4.00	%
2017		373		4.00	%
2018		252		4.02	%
Beyond 2018		8,813		2.10	%

Total	$	11,609		2.52	%

The Company entered into a ten-year “Convertible Select” fixed commitment advance arrangement with the FHLB. Rates may be reset at the FHLB’s discretion on a quarterly basis based on the three-month LIBOR rate. At each rate change, the Company may exercise a put option and satisfy the obligation without penalty.

Fixed-rate amortizing advances from the FHLB require monthly principal and interest payments and an annual 20 percent paydown of outstanding principal. Monthly principal and interest payments are adjusted after each 20 percent paydown. Under the terms of a blanket agreement, FHLB borrowings are secured by certain qualifying assets of the Company which consist principally of first mortgage loans or mortgage-backed securities. Under this credit arrangement, the Company has a remaining borrowing capacity of approximately $85.3 million at December 31, 2013.

The Company formed a special purpose entity (“Entity”) to issue $8,000,000 of floating rate, obligated mandatorily redeemable securities, and $248,000 in common securities as part of a pooled offering. The rate adjusts quarterly, equal to LIBOR plus 1.67%. The Entity may redeem them, in whole or in part, at face value. The Company borrowed the proceeds of the issuance from the Entity in December 2006 in the form of an $8,248,000 note payable, which is included in the other borrowings on the Company’s Consolidated Balance Sheet.