Federal Home Loan Bank Advances

12 Months Ended

Dec. 31, 2012

Federal Home Loan Banks [Abstract]

Federal Home Loan Bank Advances

FEDERAL HOME LOAN BANK ADVANCES

A summary of Federal Home Loan Bank (FHLB) advances outstanding at December 31, 2012 and 2011 follows:

	December 31, 2012				December 31, 2011
	Ending Balance		Weighted Average Interest Rate At Year-End		Ending Balance		Weighted  Average Interest Rate At Year-End
	(Dollars in thousands)
Fixed-rate FHLB advances	$	34,289	2.69	%	$	43,057	2.55	%

FHLB advances are collateralized by a blanket lien on qualified one- to four-family residential mortgage loans. At December 31, 2012, the carrying value of these loans was $829 million. The Corporation acquired $35.9 million of FHLB advances in conjunction with the OAK acquisition, of which $9.3 million were outstanding at December 31, 2012. The Corporation's additional borrowing availability through the FHLB, subject to the FHLB's credit requirements and policies and based on the amount of FHLB stock owned by the Corporation, was $309 million at December 31, 2012.

Prepayments of fixed-rate advances are subject to prepayment penalties under the provisions and conditions of the credit policy of the FHLB. The Corporation did not incur any prepayment penalties in 2012, 2011 or 2010. However, on January 22, 2013, the Corporation paid off early all of its FHLB advances outstanding of $34.3 million, resulting in a prepayment penalty of $0.8 million.