Long-Term Debt and FHLB Stock

12 Months Ended

Dec. 31, 2021

Long-Term Debt and FHLB Stock

Long-Term Debt and FHLB Stock

8.    Long-Term Debt and FHLB Stock

FHLB Borrowings and Stock

The Company is a member of the FHLB. At December 31, 2021 and 2020, the Company had access to a preapproved secured line of credit with the FHLB of $640,500 and $564,330, respectively. Borrowings under this line require collateralization through the pledge of specific loans and securities. At December 31, 2021 and 2020, the Company had pledged assets of $170,385 and $175,011, respectively. The Company had no outstanding overnight line of credit balances with the FHLB at either December 31, 2021 or 2020. These borrowings would mature the following business day. At December 31, 2021, the Company had structured borrowings in the amount of $18,041. The outstanding principal amounts and the related terms and rates at December 31, 2021 were as follows:

Term	Principal		Maturity	Rate		Due in one year		Long term
3 year amortizing	$	1,719	May 16, 2022	2.49	%	$	1,719		—
3 year bullet		10,000	May 16, 2022	2.44	%		10,000		—
3 year amortizing		6,322	February 28, 2023	1.32	%		5,049		1,273
Total	$	18,041	Weighted Average Rate	2.05	%	$	16,768	$	1,273

The Company is required to maintain an investment in capital stock of the FHLB, as collateral, in an amount equal to a certain percentage of its outstanding debt. FHLB stock is considered restricted stock and is carried at cost. The Company evaluates for impairment based on the ultimate recovery ability of the cost. No impairment was recognized at either December 31, 2021 or 2020.

Federal Reserve Bank Borrowings

In April 2020, the Bank became a participant in the Federal Reserve’s Payroll Protection Program Lending Facility, which allowed it to present PPP loans as collateral for 100% principal credit at the Federal Reserve’s discount window. The term of these loans mirrored the actual maturity of the underlying collateral and had a fixed interest rate of 0.35%. In April 2020, the Bank borrowed $70,100, which was repaid in full on July 2, 2020.  

Subordinated Debt

In addition to the Bank, the Company has one other wholly-owned subsidiary, RSB Capital Trust I (the “Trust”). In 2005, the Trust issued $5,000 of pooled trust preferred securities in a private placement and issued 155 shares of common stock at $1 par value per share, now owned by the Company. The Trust, which has no independent assets or operations, was formed in 2005 for the sole purpose of issuing trust preferred securities and investing the proceeds thereof in an equivalent amount of junior subordinated debentures. The proceeds from the issuance of the trust preferred securities were down-streamed to the Bank and are currently considered Tier 1 capital for purposes of determining the Bank’s capital ratios. The duration of the Trust is 30 years.

The subordinated debt securities of $5,155 are unsecured obligations of the Company and are subordinate and junior in right of payment to all present and future senior indebtedness of the Company. The Company has entered into a guarantee, which together with its obligations under the subordinated debt securities and the declaration of trust governing the Trust, including its obligations to pay costs, expenses, debts and liabilities, other than trust securities, provides a full and unconditional guarantee of amounts on the capital securities. The subordinated debentures, which bear interest at 3-month LIBOR plus 2.00% (2.16% at December 31, 2021 and 2.21% at December 31, 2020) mature on May 23, 2035.

Other Borrowings

The Company has an unsecured, uncommitted $10,000 line of credit with Zions Bank. There were no advances outstanding under this line of credit at December 31, 2021 and 2020.

The Company also has an unsecured, uncommitted $5,000 line of credit with Atlantic Community Bankers Bank. There were no advances outstanding under this line of credit at December 31, 2021 and 2020. This line of credit will be terminated on March 4, 2022.

On October 1, 2021, the Company entered into an agreement with Pacific Community Bankers Bank, for a $50,000 line of credit. There was no advance outstanding under this line of credit at December 31, 2021.