Short-term Borrowings

9 Months Ended

Sep. 30, 2017

Short-term Borrowings

Short-term Borrowings

9. Short-term Borrowings

Short-term borrowings are summarized as follows (in thousands).

	September 30,		December 31,
	2017		2016
Federal funds purchased	$	72,000	$	87,125
Securities sold under agreements to repurchase		611,701		195,164
Federal Home Loan Bank		650,000		1,000,000
Short-term bank loans		143,500		135,000
	$	1,477,201	$	1,417,289

Federal funds purchased and securities sold under agreements to repurchase generally mature daily, on demand, or on some other short-term basis. The Bank and the Hilltop Broker-Dealers execute transactions to sell securities under agreements to repurchase with both customers and other broker-dealers. Securities involved in these transactions are held by the Bank, the Hilltop Broker-Dealers or a third-party dealer.

Information concerning federal funds purchased and securities sold under agreements to repurchase is shown in the following tables (dollars in thousands).

	Nine Months Ended September 30,
	2017			2016
Average balance during the period	$	549,425		$	351,430
Average interest rate during the period		0.98	%		0.55	%
	September 30,			December 31,
	2017			2016
Average interest rate at end of period		1.10	%		0.42	%
Securities underlying the agreements at end of period:
Carrying value	$	621,429		$	209,877
Estimated fair value	$	648,517		$	206,641

Federal Home Loan Bank (“FHLB”) short-term borrowings mature over terms not exceeding 365 days and are collateralized by FHLB Dallas stock, nonspecified real estate loans and certain specific commercial real estate loans.  Other information regarding FHLB short-term borrowings is shown in the following tables (dollars in thousands).

	Nine Months Ended September 30,
	2017			2016
Average balance during the period	$	435,531		$	303,011
Average interest rate during the period		1.05	%		0.45	%
		September 30,			December 31,
		2017			2016
Average interest rate at end of period		1.22	%		0.55	%

The Hilltop Broker-Dealers use short-term bank loans periodically to finance securities owned, margin loans to customers and correspondents, and underwriting activities. Interest on the borrowings varies with the federal funds rate. The weighted average interest rate on the borrowings at September 30, 2017 and December 31, 2016 was 2.08% and 1.59%, respectively.