SHORT-TERM BORROWINGS

12 Months Ended

Dec. 31, 2012

Short-Term Borrowings

SHORT-TERM BORROWINGS

6. Short-Term Borrowings

At December 31, 2012 and 2011, the Company had no outstanding federal funds purchased. In March 2012, the Company established a $6 million REPO Line with Raymond James (formally Morgan Keegan). There have been no borrowings under this arrangement. In addition the Company established a Borrower-In-Custody arrangement with the Federal Reserve. This arrangement permits the Company to retain possession of loans pledged as collateral to secure advances from the Federal Reserve Discount Window. Under this agreement the Company may borrow up to $62,567,407. The Company established this arrangement as an additional source of liquidity. There have been no borrowings under this arrangement.

At December 31, 2012 and 2011, the Bank had unused short-term lines of credit totaling approximately $19,000,000 and $21,000,000, respectively (which are withdrawable at the lender’s option).