FHLB Advances and Other Borrowings

The Company’s funding sources include Federal Home Loan Bank advances, borrowings from other third party correspondent financial institutions, issuance and sale of subordinated debt and other capital securities, and repurchase agreements. Information regarding each of these types of borrowings or other indebtedness is as follows:



	December 31,
	2018		2017
Long-term Advances from Federal Home Loan Bank collateralized by qualifying mortgages, investment securities, and mortgage-backed securities	$	86,626	$	126,836
Term Loans	25,000		—
Junior Subordinated Debentures assumed from American Community Bancorp, Inc.	5,775		5,624
Junior Subordinated Debentures assumed from River Valley Bancorp, Inc.	5,712		5,607
Capital Lease Obligation	3,522		3,650
Long-term Borrowings	126,635		141,717

Overnight Variable Rate Advances from Federal Home Loan Bank collateralized by qualifying mortgages, investment securities, and mortgage-backed securities	$	195,000	$	92,000
Federal Funds Purchased	9,500		—
Repurchase Agreements	45,274		41,499
Short-term Borrowings	249,774		133,499

Total Borrowings	$	376,409	$	275,216

Repurchase agreements, which are classified as secured borrowings, generally mature within one day of the transaction date. Repurchase agreements are reflected at the amount of cash received in connection with the transaction. The Company may be required to provide additional collateral based on the value of the underlying securities.



	2018			2017
Average Daily Balance During the Year	$	38,454		$	40,476
Average Interest Rate During the Year	0.55		%	0.47		%
Maximum Month-end Balance During the Year	$	45,274		$	47,934
Weighted Average Interest Rate at Year-end	0.63		%	0.50		%

At December 31, 2018, interest rates on the fixed rate long-term FHLB advances ranged from 1.54% to 7.22% with a weighted average rate of 1.75%. At December 31, 2017 interest rates on the fixed rate long-term FHLB advances ranged from 1.36% to 7.22% with a weighted average rate of 1.84%. At December 31, 2018 and 2017, the Company had no advances containing options whereby the FHLB may convert a fixed rate advance to an adjustable rate advance.

The long-term borrowings shown above includes $25 million outstanding on a term loan owed by the parent company as of December 31, 2018. At December 31, 2018 interest on the term loan was based upon fixed rate of USB Cost of Funds, plus1.75%. The term loan matures September 30, 2021. At December 31, 2018, the parent company had a $15 million line of credit with no outstanding balance. The line of credit matures September 30, 2019. Interest on the line of credit is based upon 90-day LIBOR plus 1.75% and includes an unused commitment fee of 0.25%.

At December 31, 2018, scheduled principal payments on long-term borrowings, excluding the capitalized lease obligation and acquired subordinated debentures (which are discussed below) are as follows:



2019	$	31,075
2020	25,551
2021	30,000
2022	—
2023	—
Thereafter	25,000
Total	$	111,626

The Company assumed the obligations of junior subordinated debentures through the acquisitions of American Community Bancorp, Inc. and River Valley Bancorp. The junior subordinated debentures were issued to ACB Capital Trust I, ACB Capital Trust II and RIVR Statutory Trust I. The trusts are wholly owned by the Company. In accordance with accounting guidelines, the trusts are not consolidated with the Company's financials, but rather the subordinated debentures are shown as borrowings. The Company guarantees payment of distributions on the trust preferred securities issued by ACB Trust I, ACB Trust II and RIVR Statutory Trust I. Interest is payable on a quarterly basis. These securities qualify as Tier 1 capital (with certain limitations) for regulatory purposes. $11,311 of the junior subordinated debentures were treated as Tier 1 capital for regulatory capital purposes as of December 31, 2018. $11,060 of the junior subordinated debentures were treated as Tier 1 capital for regulatory capital purposes as of December 31, 2017. As a result of the acquisitions of American Community and River Valley these liabilities were recorded at fair value at the acquisition date with the discount amortizing into interest expense over the life of the liability, ultimately accreting to the issuance amount disclosed below.

The following table summarizes the terms of each issuance:



	Date of Issuance	Issuance Amount		Carrying Amount at December 31, 2018		Variable Rate	Rate as of December 31, 2018		Rate as of December 31, 2017		Maturity Date
ACB Trust I	5/6/2005	$	5,155	$	3,646	90 day LIBOR + 2.15%	4.95	%	3.84	%	May, 2035
ACB Trust II	7/15/2005	3,093		2,129		90 day LIBOR + 1.85%	4.50	%	3.30	%	July, 2035
RIVR Statutory Trust 1	3/26/2003	7,217		5,712		3-Month LIBOR + 3.15%	5.97	%	4.82	%	March, 2033

See also Note 5 regarding the capital lease obligation.