ADVANCES FROM THE FEDERAL HOME LOAN BANK (FHLB)

12 Months Ended

Dec. 31, 2020

Federal Home Loan Bank, Advances, Fixed Rate [Abstract]

ADVANCES FROM THE FEDERAL HOME LOAN BANK (FHLB) [Text Block]

NOTE 19 – ADVANCES FROM THE FEDERAL HOME LOAN BANK (FHLB)

The following is a summary of the advances from the FHLB as of the indicated dates:
		December 31,		December 31,
		2020		2019
	(In thousands)
	Short-term Fixed-rate advances from FHLB (1)	$	-	$	35,000
	Long-term Fixed-rate advances from FHLB (2)		440,000		535,000
		$	440,000	$	570,000

Interest rate of 1.83% as of December 31, 2019.Weighted-average interest rate of 2.26% and 2.21% as of December 31, 2020 and 2019, respectively.

Advances from FHLB mature as follows as of the indicated date:
		December 31, 2020
	(In thousands)
	Over three to six months	$	120,000
	Over six months to one year		120,000
	Over one to three years		200,000
	Total	$	440,000

The Corporation receives advances from the FHLB under an Advances, Collateral Pledge, and Security Agreement (the “Collateral Agreement”). The Collateral Agreement requires the Corporation to maintain a minimum amount of qualifying mortgage collateral with a market value of generally 125% or higher than the outstanding advances. As of December 31, 2020 and 2019, the estimated value of specific mortgage loans pledged as collateral amounted to $1.6 billion and $1.3 billion, respectively, as computed by the FHLB for collateral purposes. The carrying value of such loans as of December 31, 2020 amounted to $2.2 billion (2019 - $1.6 billion). As of December 31, 2020, the Corporation had additional capacity of approximately $1.2 billion on this credit facility based on collateral pledged at the FHLB, including a haircut reflecting the perceived risk associated with the collateral. Haircut refers to the percentage by which an asset’s market value is reduced for the purpose of collateral levels. Advances may be repaid prior to maturity, in whole or in part, at the option of the borrower upon payment of any applicable fee specified in the contract governing such advance. In calculating the fee, due consideration is given to (i) all relevant factors, including, but not limited to, any and all applicable costs of repurchasing and/or prepaying any associated liabilities and/or hedges entered into with respect to the applicable advance; (ii) the financial characteristics, in their entirety, of the advance being prepaid; and (iii), in the case of adjustable-rate advances, the expected future earnings of the replacement borrowing as long as the replacement borrowing is at least equal to the original advance’s par value and the replacement borrowing’s tenor is at least equal to the remaining maturity of the prepaid advance.