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ADVANCES FROM FEDERAL HOME LOAN BANK, GUARANTEED JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES AND SUBORDINATED DEBT

12 Months Ended

Dec. 31, 2021

ADVANCES FROM FEDERAL HOME LOAN BANK, GUARANTEED JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES AND SUBORDINATED DEBT

ADVANCES FROM FEDERAL HOME LOAN BANK, GUARANTEED JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES AND SUBORDINATED DEBT

13. ADVANCES FROM FEDERAL HOME LOAN BANK, GUARANTEED JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES AND SUBORDINATED DEBT

Advances from the FHLB consist of the following:


	AT DECEMBER 31, 2021
	WEIGHTED
	AVERAGE YIELD		BALANCE

MATURING	(IN THOUSANDS, EXCEPT RATES)
2022	1.88	%	$	22,888
2023	1.59			15,568
2024	1.19			4,197
Total advances from FHLB	1.71		$	42,653


	AT DECEMBER 31, 2020
	WEIGHTED
	AVERAGE YIELD		BALANCE

MATURING	(IN THOUSANDS, EXCEPT RATES)
2021	1.00	%	$	24,336
2022	2.03			20,888
2023	1.59			15,568
2024	1.19			4,197
Total advances from FHLB	1.48		$	64,989

The Company’s subsidiary Bank is a member of the FHLB which provides this subsidiary with the opportunity to obtain short to longer-term advances based upon the Company’s investment in assets secured by one- to four-family residential real estate and certain types of commercial and commercial real estate loans. The rate on open repo plus advances, which are typically overnight borrowings, can change daily, while the rates on the advances are fixed until the maturity of the advance. All FHLB stock along with an interest in certain residential mortgage, commercial real estate, and commercial and industrial loans with an aggregate statutory value equal to the amount of the advances, are pledged as collateral to the FHLB of Pittsburgh to support these borrowings. At December 31, 2021, the Company had immediately available $365 million of overnight borrowing capability at the FHLB, $32 million of short-term borrowing availability at the Federal Reserve Bank and $35 million of unsecured federal funds lines with correspondent banks.

Guaranteed Junior Subordinated Deferrable Interest Debentures:

On April 28, 1998, the Company completed a $34.5 million public offering of 8.45% trust preferred securities, which represented undivided beneficial interests in the assets of a Delaware business trust, AmeriServ Financial Capital Trust I. The trust preferred securities would have matured on June 30, 2028, and were callable at par at the option of the

Company after June 30, 2003. Proceeds of the issue were invested by AmeriServ Financial Capital Trust I in junior subordinated debentures issued by the Company. The trust preferred securities were listed on NASDAQ under the symbol ASRVP. The Company used $22.5 million of proceeds from a private placement of common stock to redeem trust preferred securities in 2005 and 2004. In addition, the Company used approximately $12 million of proceeds from a private placement of subordinated notes to retire the remaining outstanding trust preferred securities on September 30, 2021.

Subordinated Debt:

On December 29, 2015, the Company completed a private placement of $7.65 million in aggregate principal amount of fixed rate subordinated notes to certain accredited investors. The subordinated notes would have matured December 31, 2025 and had a 6.50% fixed interest rate for the entire term. This subordinated debt had been structured to qualify as tier 2 capital under the Federal Reserve’s capital guidelines and was non-callable for five years. The Company used the proceeds from this private placement and other cash on hand to redeem all $21 million of its issued and outstanding SBLF preferred stock on January 27, 2016. The Company used approximately $7.7 million of proceeds from a private placement of subordinated notes to retire this subordinated debt on September 30, 2021.

On August 26, 2021, the Company completed a private placement of $27 million in fixed-to-floating rate subordinated notes to certain accredited investors. The notes mature September 1, 2031 and are non-callable for five years. The notes have a fixed annual interest rate of 3.75%, payable until September 1, 2026. From and including September 1, 2026, the interest rate will reset quarterly to the then-current three-month Secured Overnight Financing Rate (SOFR) plus 3.11%. This subordinated debt has been structured to qualify as tier 2 capital under the Federal Reserve’s capital guidelines. As previously disclosed, the Company used approximately $20 million of the net proceeds to retire its existing subordinated debt and trust preferred securities on September 30, 2021. The remainder of the proceeds are being utilized for general corporate purposes, including the downstream of $3.5 million as capital to the bank. The net balance of subordinated debt as of December 31, 2021 was $26.6 million. This compares to the net balance of guaranteed junior subordinated deferrable interest debentures (trust preferred securities) of $13.0 million and subordinated debt of $7.5 million as of December 31, 2020.