Note 15. Debt

As of December 31, 2016 and December 31, 2015, the Bank had $35 million and $40 million of outstanding FHLB debt, respectively, consisting of five and seven advances, respectively. Three advances for $5.0 million each that matured in February 2016, April 2016 and September 2016 were repaid. The fixed rate advance that matured in October 2016 was replaced with a three month 0.49% fixed rate advance for $5.0 million. A new advance for $10.0 million was drawn in December 2016 with a two month 0.67% fixed rate maturing in February 2017. The $5.0 million advance that matured in January 2017 was replaced with an 11 month 0.995% fixed rate advance. The advance maturing in February 2017 was replaced with a three month 0.79% fixed rate advance. Two new fixed rate advances of $5.0 million each have been drawn thus far in 2017.

The five advances are shown in the following table.


					Current			Maturity
Description	Balance		Originated		Interest Rate			Date
Adjustable Rate Hybrid	$	10,000,000		4/12/2013		3.25750	%		4/13/2020
Fixed Rate Credit		10,000,000		12/30/2016		0.67000	%		2/28/2017
Fixed Rate Credit		5,000,000		10/20/2016		0.49000	%		1/20/2017
Fixed Rate Credit		5,000,000		12/21/2015		0.99000	%		6/15/2017
Fixed Rate Credit		5,000,000		12/22/2015		1.08000	%		9/15/2017

	$	35,000,000

Advances on the FHLB lines are secured by a blanket lien on qualified 1 to 4 family residential real estate loans. Immediate available credit, as of December 31, 2016, was $74.9 million against a total line of credit of $115.9 million.

As of December 31, 2016 and December 31, 2015, the Company had $35.0 million and $40.0 million, respectively, in FHLB debt outstanding with a weighted average interest rate of 1.49% and 1.17%, respectively.

Subordinated Debt

On May 28, 2015, the Company entered into a Purchase Agreement with 29 accredited investors under which the Company issued an aggregate of $7,000,000 of subordinated notes (the “Notes”) to the accredited investors. The Notes have a maturity date of May 28, 2025. The Notes bear interest, payable on the 1st of March and September of each year, commencing September 1, 2015, at a fixed interest rate of 6.50% per year. The Notes are not convertible into common stock or preferred stock, and are not callable by the holders. The Company has the right to redeem the Notes, in whole or in part, without premium or penalty, at any interest payment date on or after May 28, 2020 and prior to the maturity date, but in all cases in a principal amount with integral multiples of $1,000, plus interest accrued and unpaid through the date of redemption. If an event of default occurs, such as the bankruptcy of the Company, the holder of a Note may declare the principal amount of the Note to be due and immediately payable. The Notes are unsecured, subordinated obligations of the Company and will rank junior in right of payment to the Company’s existing and future senior indebtedness. The Notes qualify as Tier 2 capital for regulatory reporting.


(Dollars in thousands)	Balance as of			Balance as of
	December 31, 2016			December 31, 2015
6.5% Subordinated Debt	$	7,000		$	7,000
Less: Issuance costs		(140	)		(156	)

	$	6,860		$	6,844