Note 11 - Borrowed Funds

9 Months Ended

Sep. 30, 2025

Notes to Financial Statements

Debt Disclosure [Text Block]

11. Borrowed Funds

Borrowed funds may consist of securities sold under repurchase agreements, which represent overnight or term borrowings from customers, advances from the Federal Home Loan Bank of Atlanta (“FHLB”), advances from the Federal Reserve Bank of Richmond (the “Reserve Bank”), term borrowings from a commercial bank, subordinated note issuances, and overnight borrowings from commercial banks.

Additional information is as follows:

	September 30,			December 31,
(Dollars in thousands)	2025			2024
Amount oustanding at period end:
Securities sold under repurchase agreements	$	2,458		$	5,564
Federal Home Loan Bank advances		50,200			5,000
Long-term debt (net of issuance costs)		12,024			11,329
Weighted average rate paid at period end:
Securites sold under repurchase agreements		1.25	%		1.25	%
Federal Home Loan Bank advances		3.88	%		1.00	%
Long-term debt		7.88	%		4.10	%

The Bank is approved to borrow 75% of eligible pledged single-family residential loans and 50% of eligible pledged commercial loans as well as investment securities, or approximately $22.2 million under a secured line of credit with the FHLB at September 30, 2025. The Bank also has a facility with the Reserve Bank, which has been in place for over 10 years and is collateralized by loans. Under this facility, the Bank can borrow approximately $30.2 million. Additionally, the Bank has $23.5 million ($14.5 million unsecured and $9.0 million secured) of overnight federal funds lines of credit available from commercial banks.

FHLB advances of $50.2 million and $5.0 million were outstanding as of September 30, 2025 and December 31, 2024, respectively. The Company borrowed $17.0 million to facilitate the Merger in 2020, of which $11.3 million was outstanding as of December 31, 2024. (The “Merger Loan”) was fully repaid on September 30, 2025. There were no borrowings from the Reserve Bank or our commercial bank lenders at September 30, 2025 or December 31, 2024.

On September 25, 2025, the Company entered into a Subordinated Note Purchase Agreements with certain qualified institutional buyers and institutional accredited investors pursuant to which the Company issued and sold $12.5 million in aggregate principal amount of its 7.875% Fixed to Floating Rate Subordinated Notes due September 25, 2035. The Company used a portion of the net proceeds from the offering to repay the outstanding balance of approximately $10.1 million that was due under the Merger Loan.